by Becki Gray
Former Senior Vice President, John Locke Foundation
Occupational licensing restrictions, essentially a tax on jobs are clearly a problem in NC as regular readers of this blog have learned here and here and here. Although NC has some of the most restrictions impacting jobs, the problem is pervasive across the country and now for the first time the federal government is stepping in, as this NY Times piece explains:
Over the years, states across the country have added licensing requirements for a bewildering variety of jobs, requiring months or years of expensive education, along with assessing costly fees.
Today, nearly 30 percent of the American work force needs a license to work, up from about 10 percent in the 1970s, according to Morris Kleiner, a professor of public affairs at the University of Minnesota, who has studied the issue.
The Obama administration and the conservative political network financed by the Koch brothers don’t agree on much, but the belief that the zeal among states for licensing all sorts of occupations has spiraled out of control is one of them. In recent months, they have collaborated with an array of like-minded organizations and political leaders in a bid to roll back licensing rules.
On Friday, the White House announced that it would provide $7.5 million in grants to organizations interested in working with states to reduce overly burdensome licensing and make it easier for licensed practitioners to work across state lines, an issue of particular importance to military families.
“This grant is the first time the federal government has directly gotten involved to help states that want to reform their licensing practices,” Jason Furman, chairman of the White House Council of Economic Advisers, said in an interview. “It was something a Democratic president proposed and a Republican Congress passed.”
Economists on both the left and the right argue that excessive licensing raises prices for consumers without improving services; it can also deter potential workers from moving across state lines, dragging down employment growth.
“There is no labor economist who thinks it is good for the economy,” said Lee U. McGrath, legislative counsel in Minnesota for the Institute for Justice, a libertarian organization whose lawyers are representing Ms. Granatelli in a lawsuit against the Arizona veterinary board.
In Tennessee, a license is required to shampoo hair; in Florida, to sell a yacht. In Montana, you need the state’s approval to be an egg candler; in Utah, to repair upholstery; in Louisiana, to be a florist.
No one disputes that health and safety concerns make licenses indispensable in certain demanding professions, like nursing or flying a commercial airplane, and they are sometimes helpful in improving standards and providing quality assurance to consumers.
But the current mishmash of requirements is too often “inconsistent, inefficient, and arbitrary,” a White House report concluded last year. Many of them, the report said, have little purpose other than to protect those already in the field from further competition.
Requirements for the same job often have whiplash-level variation. South Dakota requires 2,100 hours of education and a cosmetology license to braid hair — a popular entry point into the labor force for African-American women. South Carolina demands only a six-hour course.