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Impact of Rising Regulations on Chemical Manufacturing & American Priorities

ACC Member Survey

The Impact of Rising Regulations on Chemical Manufacturing & American Priorities report provides valuable insight into the impact of the tremendous rise in chemical regulations and how they adversely impact national priorities and American manufacturing. The findings are the result of a survey of ACC member companies doing business in the U.S.

Chris Jahn, President & CEO | American Chemistry Council
U.S. chemical manufacturers continue to face challenges from persistent inflation, competition overseas, and a dramatic increase in regulations at home. Unless policymakers take a different approach to how they develop and apply regulations, critical chemistries will suffer along with the important products supported by chemistry.
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Chemistry Contributes to Supporting National Priorities

Chemical manufacturers also contribute important products to support National Defense and Transportation.
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Growing Regulatory Burden

Most chemical manufacturers report that overall regulatory burden has increased across all levels of government. And they expect the number of regulations to continue to increase over the next year.

Regulatory Burden Now
Regulatory Burden Future
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Impact of Regulations on National Priorities

Many of the chemical manufacturers that produce chemical inputs to products/industries prioritized by the Administration reported that the current and/or forthcoming regulatory burden negatively impacts their ability to competitively produce the chemical input(s) in the U.S. Across chemical manufacturers participating in the survey, this was found to be the case for:


Impact of Regulations on Manufacturing

Over the past year, about 2/3 of chemical manufacturers reported having been adversely affected due to government delay in making a regulatory decision and/or taking a regulatory action on a permit, license, or product approval in the United States.

Companies said new regulatory policies:
  • 43% Impacted ability to obtain permits
  • 12% Led company not to expand U.S. operations
  • 9% Led company to move operations out of the U.S.

Asked to consider a scenario where existing regulatory compliance costs were suddenly and permanently increased significantly, manufacturers report they would:

Impact of Regulations on Manufacturing
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Regulatory Challenges and Issues

Chemical manufacturers reported that the most challenging regulations to comply with are due to:

Regulatory Challenges and Issues

And companies mentioned other reasons, including decision timelines that are inconsistent or delayed; slow responses to regulatory permits; new substance PMN is expensive and takes too long to approve; regulations and reporting burdens that do not reflect the risk to human health and the environment; and regulations based on improper or inadequate science.

Big Return on Fixing Regulations

Asked to consider a scenario where existing regulatory compliance costs were suddenly and permanently reduced significantly, chemical manufacturers said saved resources would be diverted towards:

  • Investment in R&D, new technologies, and new products
  • Capital replacement (operational efficiency)
  • Increased hiring, expanding operations / capacity, sustainability initiatives

 


Methodology

In September of 2023, the American Chemistry Council (ACC) conducted a survey of member companies doing business in the U.S. to better understand how they are being impacted by regulations. 58 companies participated in the survey. 38% of the companies surveyed are “small businesses” employing 550 or less full-time equivalents (FTEs). 

Every effort has been made in the preparation of this publication to provide the best available information. However, neither the American Chemistry Council, nor any of its employees, agents, or other assigns, makes any warranty, expressed or implied, or assumes any liability or responsibility for any use, or the results of such use, of any information or data disclosed in this material.

This report was prepared by ACC’s Economics and Statistics Department.

Questions about the survey and findings may be directed to:

Emily Sanchez | Director, Economics & Data Analytics