Business Executives Say Gov’t Regulations to Blame for Thousands of Job Losses

Regs threaten the existence of small businesses, crippling them with higher costs

unemployment
A veteran talks with an outreach representative about employment opportunities at a job fair / AP

Business executives told lawmakers that government regulations are to blame for thousands of job losses and may threaten the existence of small businesses during a House Judiciary Committee hearing on Wednesday.

Ryan Murray, vice president of operations at Murray Energy Corporation, testified in the hearing that the Stream Protection Rule proposed by the Office of Surface Mining, Reclamation, and Enforcement of the Department of Interior has destroyed jobs, operations, and suppliers within the company.

Murray Energy, which is the nation’s largest underground coal mining company, employed more than 8,000 individuals at its peak of employment in May 2015. Since then, 2,000 employees have been out of work. The company currently employs 6,000 Americans in six states.

Murray says that the rule is the "single greatest threat" to the jobs and livelihoods of their employees that they have ever witnessed. While the rule was originally designed to keep surface mining operations from mining through streams, Murray says that it has been manipulated behind closed doors and now will ultimately end all longwall mining in the United States.

"Due to the destructive and illegal actions of the Obama administration, our industry is under attack," Murray said. "America’s coal miners and their families, suppliers, and entire communities are indisputably being destroyed. Now, with the proposed Stream Protection Rule, our industry will be eliminated for no environmental benefit whatsoever."

While the agency maintains that there would be minimal job impacts from the rule, Murray says that some estimates show that the rule would cost 112,757 to 280,809 jobs throughout the United States.

Janet Kaboth is president and CEO of Whitacre Greer Company, which manufactures clay products such as firebrick for the inside of masonry fireplaces, and has been in operation since 1916. Kaboth told lawmakers that two regulations from the Environmental Protection Agency and the Occupational Safety and Health Administration, are having a crippling impact on the brick industry.

The brick MACT rule proposed by the EPA would require Kaboth’s company to purchase $4 million for equipment that would eliminate mercury. Kaboth says that this cost represents 23 percent of the company’s net worth and would only eliminate four pounds of mercury. The Occupational Safety and Health Administration regulation would require an installation of equipment that would detect silica, which is estimated to cost her company $906,530.

"Compliance with both these regulations would require me to obtain a loan for $5,000,000 to add equipment that would not reduce our costs, improve our product or increase our sales," Kaboth said. "If these two regulations would save lives—the lives of our workers or our neighbors—it would be worth it. However, for both these rules, the agencies themselves have data that show that the benefit of these regulations is minimal or non-existent for the brick industry.

Kaboth said her company employs 80 workers and pays more than $4 million in wages. The regulations would harm employees who would have difficulty finding other employment and those who don’t have a high level of education. "Compliance with these regulations threatens the continued existence of many small companies in our industry."

"These two rules, and their crippling impact on the U.S. brick industry," said Kaboth, "illustrate how workers and local communities can be devastated by new regulations even when jobs are being created at the national level and the overall unemployment rate is low."