Thursday, September 10, 2015

Occupational licensing fees are a permanent money source for states

“Licensing is done by the states, and requirements vary widely from state to state. There are 1,100 different professions licensed in America, but only 60 are licensed by every state. Requirements also vary. Michigan requires security guards to have thee years of education, while no other state requires more than eight months.

Who is hurt by burdensome licensing requirements? Military spouses have to move frequently from state to state and licenses aren’t easily transferred. Immigrants find licensing boards produce impenetrable requirements. People with any criminal conviction may find themselves perpetually barred from a licensed profession, even if the license has nothing to do with the crime. Ex-prisoners also have to wait up to a year for a decision from a licensing board, forcing them to be idle even as they struggle to re-enter the labor force.

But the primary victims of licenses are the poor. One study found that dental visits cost 9-11 percent higher in states with tight requirements for licensing hygienists than states with looser requirements. A 2012 report from the state of New York found that 95 percent of the people in court for eviction notices or consumer debt cases weren’t represented by lawyers because they couldn’t afford them. New York State bars lower-cost paralegals from representing the poor in these routine cases.”

Occupational licensing, also called occupational licensure, is a form of government regulation requiring a license to pursue a particular profession or vocation for compensation. Professions that can have a large negative impact on individuals, like physicians and lawyers, require occupational licenses in most developed countries, but many jurisdictions also require licenses for professions without that possibility, like plumbers, taxi drivers, and electricians. Licensing creates a regulatory barrier to entry into licensed occupations, and this results in higher income for those with licenses and usually higher costs for consumers.

“Licensing advocates argue that it protects the public interest by keeping incompetent and unscrupulous individuals from working with the public. However there is little evidence that it has an impact on the overall quality of services provided to customers by members of the regulated occupation.” Wikipedia, from

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