License Overload? Lawmakers are questioning whether we've gone too far with occupational and professional licensing.

• Author: Downs, Albert
• Position: LABOR AND EMPLOYMENT

Nurses and athletic trainers need one, so do barbers and cosmetologists. Even home inspectors need one. An occupational or professional license can require hours of instruction, intense testing and, in some cases, high fees. It's all worth it, many say, if it protects public health and safety and ensures a minimum level of quality in products and services.

The number of jobs requiring a license has grown steadily, from about 5 percent of all occupations in the 1950s to more than 25 percent of the American workforce today. The share of licensed workers, however, varies by state, ranging from a low of 12 percent in South Carolina to a high of 33 percent in Iowa.

Licensing is a state responsibility, and each has developed its own regulations, usually with decision-making authority falling to quasi-governmental boards made up of people overseeing occupations most of them are employed in. Education and training standards vary widely, along with the fees and the limitations on who may apply for a license. (Some states bar those with immigrant status or a criminal history, for example.)

Michigan requires three years of education and training to become a licensed security guard, for example, while most other states require 11 days or fewer. And while all 50 states license cosmetologists and emergency medical technicians, the education requirements vary greatly. Iowa, Nebraska and South Dakota require cosmetologists to study at least 233 days; Massachusetts and New York double that time. But the length of training time required of entry-level EMTs averages just 33 days nationwide.

Proponents say licensing is the best tool lawmakers have to protect workers and the public. Populating boards with the people who have the expertise necessary to address the profession's specific issues is key. "Doing so increases the effectiveness of the administrative system that is designed to provide consumers with an assurance of the qualifications of licensees along with a means of enforcement for the benefit of the public," says Dale Atkinson, executive director of the Federation of Associations of Regulatory Boards. Supporters also point out that the increase in licensing has enjoyed bipartisan, nationwide support.

Critics Cite Studies

Critics, who also come from across the ideological and partisan spectrum, cite studies that show no evidence licensing improves safety. One such study was conducted by labor economist and licensing expert Morris Kleiner. He studied the effects of occupational regulations on one of the fastest growing segments of the U.S. labor market--the online, on-demand economy that includes ride-sharing networks.

In 2017, Kleiner compared data on the safety and quality of trips driven by licensed Uber drivers with those driven by new, unlicensed drivers in Houston, New York and New Jersey. He "found that occupational licensing frequently had no effect on safety and quality." Even when there was a positive effect, Kleiner says "the magnitude of the effect was small."

Other studies back Kleiner's conclusion. According to a 2015 review done by the Department of the Treasury Office of Economic Policy, the Council of Economic Advisers and the Department of Labor, 85 percent of the research on licensing concluded there was little evidence it improved the quality or safety of products and services.

Findings like these have prompted law-makers to re-examine the design and impact of their licensing...