OPINION:
In his Inaugural Address, President Biden called unity “the most elusive of all things in a democracy.” He was right. And if he really wants to unite this country, which has been fractured for so long by so many deep and bitter partisan conflicts, he needs to begin his presidency by pursuing policies that both parties can support.
One thing he can do at once is to continue his efforts for reform of licensing laws.
Occupational licenses are laws that keep people from working. In the 1950s, only about five percent of the nation’s workers were required to be licensed. Today, it’s about 25 percent. Depending on which state you’re in, you may need a license to be a florist, handyman, makeup artist, auctioneer, barber, dance instructor, tour guide, manicurist, fireworks operator, hair stylist, taxidermist, tattoo artist, interior designer or any one of a host of other occupations.
Obtaining a license may require hundreds of hours of instruction, one or more qualifying examinations, and hundreds of dollars in fees. Often, the credentialing process is excessive and serves only to the limit the number of entrants into a given job market. That not only penalizes the most vulnerable people who want to work, such as women and minorities, it means less competition and higher prices for consumers.
Military spouses are another group who are particularly affected. Approximately one-third of military spouses work in occupations that require licenses. Since these spouses move on an average of every two to three years, they will frequently find themselves in a state that doesn’t recognize their previous state’s credentials. To take another example, ex-convicts are frequently barred from certain occupations, no matter how long ago their crime may have been committed or whether it is related to the job they are seeking to perform.
The total cost of licensing laws is considerable. A recent study by the National Bureau of Economic Research calculated that occupational licensing results in up to 2.85 million fewer jobs nationwide, and costs consumers more than $200 billion.
A study conducted by the Obama administration in 2015 found that licensing requirements “raise the price of goods and services, restrict employment opportunities, and make it more difficult for workers to take their skills across state lines.”
President Biden, who was then vice president, supported reform of licensing laws. This was one of the few Obama policy initiatives carried forward by Donald Trump when he became president. Ivanka Trump urged states to end the practice of excessive licensure, and Karen Pence, wife of Vice President Pence, took up the cause of military spouses who were encumbered by state licensing laws.
Mr. Biden continued his push for licensing reform during his campaign for president. In a speech to a union audience in Pittsburgh in 2019 he asked, “Why should someone who braids hair have to get 600 hours of training? It makes no sense. They’re making it harder and harder in a whole range of professions, all to keep competition down.”
Here, Mr. Biden was referring to the particularly notorious case of an African-American woman who was prevented from doing African-style hair braiding. State authorities told her that she needed a cosmetology license. Obtaining the license would have required her to complete hundreds of hours of training, pass two exams, and spend thousands of dollars to attend a cosmetology school that didn’t even teach hair braiding.
Such extreme cases illustrate the unfairness and counterproductive effects of licensing laws. They also illustrate why reform is attracting broad bipartisan support at both the federal and state levels. Over the past couple of years Arizona, Florida, Ohio and Pennsylvania have enacted sweeping licensing reform bills.
Since licensing laws are state laws, there are limits to what the federal government can do to promote reforms, although the feds have helped nudge the process along by promoting interstate reciprocity in licensing. The COVID-19 epidemic has given further impetus to interstate reciprocity, particularly in the field of health care professionals.
As president, Mr. Biden can use the “bully pulpit” to advance this policy goal. Reform of licensing laws will multiply job opportunities — especially for those who need them most — spur the post-pandemic recovery and help restore public confidence in our political system. If Democrats and Republicans can work together on what, after all, ought to be a matter of common sense, then there is hope that they can work together on more complex and divisive issues in the future.
• Thomas C. Stewart is a retired New York investment banker and former naval officer.
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