A new report is out from the White House Council of Economic Advisers, Treasury, and the Department of Labor. Since the 1950s, licensed occupations have increased five-fold. The report notes that this "creates substantial costs, and often the requirements for obtaining a license are not in sync with the skills needed for the job."
The story continues: (bolding mine)
Imagine the impact on our economy of several million additional jobs and one hundred billion dollars in additional discretionary spending.
And a few additional bullet points from the article:
Do you agree with the White House Council of Economic Advisers? Are we an over-licensed society?
Extra Credit: What about replacing many of these licenses with certifications, and allowing other groups to offer certifications in competition with government agencies?
The story continues: (bolding mine)
Libertarians have been objecting to occupational licensing on these grounds for decades, of course; the free-market friendly Institute for Justice has even been systematically suing to bring about their demise. But it's rare to see federal agencies recommend against more economic regulation, so let's all just savor this small victory a moment. The scathing report paints occupational licensing as a regulatory scheme that serves almost no one any good—raising consumer costs while failing to deliver improved quality; reducing employment opportunities, especially among the most economically vulnerable; and hampering state-to-state mobility and market innovation.
"By one estimate, licensing restrictions cost millions of jobs nationwide and raise consumer expenses by over one hundred billion dollars," the report authors write.
"Consumers are likely most familiar with licensing requirements for professionals like dentists, lawyers, and physicians," they point out, "but today licensing requirements extend to a very broad set of workers," including auctioneers, scrap metal recyclers, barbers, manicurists, eyebrow threaders, and tour guides. This means that an ever-growing share of jobs "are only accessible to those with the time and means to complete what are often lengthy"—not to mention expensive—licensing requirements, while the penalties for working without a license can include job loss, fines, and even incarceration.
Yet stringent occupational licensing seldom delivers improved services or safety to consumers. In 10 out of the 12 empirical studies reviewed by the report authors, stricter licensing was not associated with quality improvements.
Imagine the impact on our economy of several million additional jobs and one hundred billion dollars in additional discretionary spending.
And a few additional bullet points from the article:
- Occupational licensing laws raise consumer prices.
- Nearly one third of U.S. workforce is subject to occupational licensing.
- Requirements vary widely by state.
- They hit some populations especially hard, including immigrants, people with criminal convictions, military spouses, and people who default on student loans.
- Entrenched interests benefit most.
Do you agree with the White House Council of Economic Advisers? Are we an over-licensed society?
Extra Credit: What about replacing many of these licenses with certifications, and allowing other groups to offer certifications in competition with government agencies?
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