By Loren Furman and Steve Swinney

Every day in Colorado, business owners are faced with decisions most people never see, shaped by rising costs and a regulatory environment that has grown more complex over time. Those choices eventually reveal themselves across our local communities when longstanding businesses close, housing projects stall, or job opportunities become harder to find. For years, employers across the state have been raising these concerns, and the data shows they’re right.

Last year, the Colorado Chamber released a study that became one of the most talked about reports of the 2025 state legislature. It found Colorado is the sixth-most regulated state in the nation, with wide-reaching effects on jobs, socioeconomic conditions and our broader economy. The chamber recently released an annual update to track whether things have improved year-over-year. The good news is our ranking did not get worse — but unfortunately, it didn’t get better either. Colorado remains in the No. 6 spot, still among the most heavily regulated states in the country.

Colorado businesses operate under hundreds of thousands of state-level rules, with even more layered on at the local and federal level. These regulations apply to the smallest of operations — like the local coffee shop on your neighborhood corner — to the biggest employers and Fortune 500 companies that call Colorado home. Keeping up with that many regulations often means waiting longer for permits, responding to overlapping (and often contradictory) requirements from multiple agencies, and paying more for legal and administrative support just to stay compliant.

Over time, those demands shape how businesses grow. Business owners may delay opening new locations because approvals take too long, and expansion plans are put on hold when compliance costs come in higher than expected. Hiring decisions get pushed back, and wage increases become harder to sustain. These are everyday choices employers are forced to make, and taken together, they shape the job market and the pace of economic growth in communities across the state.

We see these effects play out across industries and regions in Colorado, including in our own work.

At Kodiak Building Partners, a leading acquisition firm in the building materials industry, we see firsthand how excessive regulations slow productivity and delay housing and infrastructure projects communities depend on. Building and construction is a cornerstone of Colorado’s economy, but housing demand continues to far outpace supply, partly because the rules and regulations to build add substitutionally to the cost of a home. This is a major contributor to the lack of affordable housing in Colorado, where we’re now one of the most expensive places to live in the country.

Other industries face similar challenges. A chamber member in the assisted-living sector recently shared how regulations in that field have doubled over the last several years. The rules now cover everything from employee meal times to how mop water must be handled. One regulation requires a dining area that can comfortably accommodate all residents, yet the rules never explain what “comfortable” actually means. For small facilities like that, keeping up with vague and constantly changing rules across local, state and federal levels feels like chasing a finish line that keeps moving.

As regulations continue to add up, unintended consequences become more common. Businesses have to shift focus toward managing requirements and away from growth, hiring and long-term planning. Cost pressures on business lead to higher prices in a state where the cost of living is already high and continues to rise faster than wages for many workers. Employers want to pay competitive salaries, and employees need paychecks that stretch far enough to cover basic necessities like housing, food, child care and transportation. Businesses struggle to keep up, and hardworking Coloradans feel the strain.

This regulatory pressure also has wide-ranging effects on our state’s overall competitiveness. In recent Colorado Chamber business polls, companies are becoming less and less likely to want to invest and grow here due to our cost of doing business. They’re increasingly looking to other states for corporate expansions, workforce investment and new facilities. Restaurants and retailers are among the hardest hit; we continue to see troubling headlines on beloved local Colorado establishments shutting down operations at alarming rates. When businesses that have served their communities for years close and storefronts go dark, our cities and towns lose a core part of their identity.

It affects whether jobs are created, whether housing projects move forward, whether local businesses can stay open and whether communities have room to grow. Over time, regulations shape overall affordability and the strength of local economies in ways people feel, even if they never see the rules themselves.

That is why regulatory reform is a priority for the Colorado Chamber. Though it might not be the most exciting political topic in the news these days, it matters to everyday life in Colorado. We’ve found this issue is also uniquely bipartisan, bringing together members of both parties at a time when political tensions are high.

Last year marked the beginning of progress, and that work will continue in 2026 with the next phase of the Chamber’s regulatory relief package coming soon. Our focus is simple: more transparency and a better, comprehensive review of existing regulations to find out what’s working and what’s not.

We believe better processes lead to better outcomes. Regular review of regulations helps catch problems early and provides clarity for businesses and workers alike. It allows Colorado to maintain important standards while reducing unintended consequences.

Getting our regulatory system right matters for the future of our communities, helping ensure our state remains a place where Coloradans can build careers, run businesses and seize opportunities.

Loren Furman is president and chief executive of the Colorado Chamber of Commerce. Steve Swinney is chief executive of Kodiak Building Partners and a member of the Colorado Chamber’s Board of Directors.