Finding balance in occupational licensing

Recently, the Institute for Justice (Institute) determined state licensing barriers for lower-income workers and aspiring entrepreneurs not only hurts people trying to establish themselves in a profession, but annually drives consumer prices up by $203 billion.

Washington requires people in 77 jobs, including driving school bus, well drilling and operating cranes, to be licensed. That means applicants must successfully complete education and training, pass their exams, and pay licensing fees.

Just as technology changes, so do licensing requirements and fees. The key is finding that balance which is appropriate for each occupation, especially for workers in low-income jobs.

The Institute, which was founded in 1991, studied 102 occupations nationwide. While it found Washington and Louisiana have the most licensing requirements for lower-income occupations, Hawaii’s prerequisites are the most grueling and California’s licensing system is just out of whack.

The Wall Street Journal (Journal), in a recent editorial, argued: “California has the most dysfunctional regime. Across professions, it has established ‘a nearly impenetrable thicket of bureaucracy’ where ‘no one could’ provide a ‘list of all the licensed occupations,’ as one state oversight agency admitted last year.

“California’s door repairmen, carpenters and landscapers must first rack up 1,460 days of supervised on-the-job experience, then pay more than $500 for the license, before they can work as a contractor.”

No state wants that label. California’s tarnished reputation hurts workers, consumers and employers.

The good news is the Institute found that our state’s licensing laws are less burdensome than most, ranking 48th in the nation. On average, they require $209 in fees, 163 days of education and experience, and, in most instances, one exam.

However, there have been exceptions.

One was hair braiding.

In 2005, African hair braider Benta Diaw sued Washington’s Department of Licensing over the state’s effort to require her and other braiders to obtain cosmetology licenses.

To become a cosmetologist in Washington, a hair braider would have to spend 1,500 hours in a cosmetology school, pass two exams and pay $230. But, the course did not cover hair braiding.

The Institute’s attorneys in the Bellevue office claimed that is more than 10 times the number of hours required to become an animal control officer, emergency medical technician and security guard combined.

In 2005, the Department announced that braiding did not, and would not, require a cosmetology license, but nine years later the Institute filed a lawsuit to get a binding order preventing the state from requiring a cosmetology license.

Kent-based braider Salamata Sylla, who emigrated from Senegal in 1999, was plaintiff Salmata, a single mom, learned to braid as a child by practicing on her family and friends. Since her exclusively practice was African hair braiding, the court sided with her.

The licensing requirements for hair braiders also hurt consumers by restricting access to goods and services.

The Journal reported Louisiana has around 400,000 more black residents than neighboring Mississippi. But in 2012, Mississippi had 1,200 licensed African-style hair braiders. Louisiana, which requires 500 hours of training, had just 32.

Not all licensing issues are as straightforward. State licensing requirements also impact competition.

For example, in Louisiana monks at Saint Joseph Abbey, a century-old Benedictine monastery in Covington, attempted to sell their handmade wooden caskets directly to the public. A state board ruled under Louisiana law, it is a crime for anyone but a licensed funeral director to sell “funeral merchandise,” which includes caskets.

The precedent-setting constitutional question for the U.S. Supreme Court: Can the government suppress economic liberty?

The Institute report serves a useful purpose. It should cause state lawmakers and agency regulators to revisit occupational licensing which hopefully will benefit everyone.