Occupational licensing limits access to middle class jobs

“Our occupational licensing laws are out of control. We need to fix them.”

So said blogger Andy Koenig in a wonderful essay entitled “It Takes 890 Days to become a barber in Nevada,” about the ridiculously onerous prerequisites for jobs that required none a few decades ago. www.politico.com/agenda/story/occupational-licensing-laws-states-000035

Koenig cited a White House Report that surveyed the occupational licensing landscape and did a good job pinpointing some of its abuses.

There are many benefits to licensing:

It sets minimum competency standards for a profession or occupation;

• It provides a roadmap for ongoing training and professional development;
• In certain occupations, it is a way of providing consumers with a greater assurance of safety and health.

All that being said, there are severe detriments to licensing, particularly at the state and local level:

It creates needless entry barriers for employable individuals who have mid-level skills and levels of education;

• Because it artificially shrinks the supply of providers, it raises prices for consumers;
• It severely inhibits movement of people across state lines, especially spouses of military personnel or what are called "trailing spouses," that is, spouses of someone in a business position who is transferred frequently. My wife and I were attorneys who had to retake the bar exam in New York State in 1982, even though we had been admitted to the Illinois bar. My wife also had been admitted to the bar in Pennsylvania. There were two parts to the bar exam: the New York essays and the Multistate Exam. We could understand the need to demonstrate competency in New York law, but we did not understand why we had to retake the standardized Multistate Exam; and
• It often excludes people with criminal records, no matter how unrelated to the requirements of the job and no matter how many years before the individual had been convicted of a crime.

If we want to create middle class jobs for more Americans, the best path to do so would be for President Obama or his successor to convene a summit at the White House and to make a strong effort to get the least defensible of these licensing requirements reduced or eliminated. The states are the expiermental laboratories for what could be a rational and relatively non-exlusionary licensing and certification system that works everywhere to maximize middle class job opportunities, while providing sufficient protection for public health and safety.

My uncle learned to cut hair in the military and opened a barbershop after World War II. He supported a family as a barber and part-time bartender. Today, if he were in Nevada, it would take him 2 ½ years of training and preparation to do what he had no trouble doing without such training 70 years ago. These kinds of requirements fall hardest on the most vulnerable Americans. We know that many requirements are designed primarily to protect incumbents from runaway competition.

The sad fact is that some of the licensing requirements are not even well matched to the purposes they are designed to achieve. For example, in Connecticut, livery drivers (that is, those who drive taxis, limousines, and vans) are required to get an annual physical examination and to undergo a drug test. This is designed to make sure that they are not impaired when they are driving others for a living. The problem with a once-a-year physical examination is that a great deal can happen during the course of a year that would impair someone’s ability to function. Moreover, fatigue can impair someone’s capabilities, and it is not addressed in this process. Moreover, there are many medical conditions not readily detectible in annual physical examinations that can result in an impairment.

The other problem with many certificate and licensing programs is that they are too narrowly focused on a single path to determine competency. There should be more online learning and the ability to take exams, the way the GED tests can substitute for a high school diploma, to enable those working full-time to upgrade their skills and to qualify for higher-level jobs. Today, we essentially require too many people to become full-time students and take classroom-based courses to receive a certificate that enables them to qualify for a profession.

We need to reduce the financial entry barriers to professions, and recognize that people have more limited blocks of time available to pursue alternative careers, especially single parents who are already working one or two other jobs. If they are going to acquire the skills required to compete in the global economy, we need to bring the training and development to them, rather than forcing them to make more challenging efforts to learn skills.

There are also wonderful simulation programs and techniques that will help qualify someone to do a job and to learn what is most useful in doing that job. There are an infinite variety of new learning techniques and systems that we should be employing in making as many Americans as possible to compete in the global economy.