News: Quick Takes

N.C. in the middle among states in regard to occupational licensing, study finds

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A report from the Wisconsin Institute for Law and Liberty rates North Carolina just average when it comes to occupational licensing.

North Carolina ranked 26th on the group’s Red Tape Index.

Will Flanders, research director, and Collin Roth, a research fellow, looked into the effects of occupational licensing on a variety of low- to middle-income jobs. These jobs include aestheticians, athletic trainers, cosmetologists, manicurists, veterinary technicians, emergency medical technicians, private detectives, pest-control workers, locksmiths, and massage therapists in all 50 states.

WILL determined that states with less burdensome occupational licensing requirements had higher employment rates in the 10 professions. Hawaii, Massachusetts, Connecticut, Rhode Island, and Utah have the least burdensome requirements. Tennessee, Alabama, Nevada, Florida, and Wisconsin put the most burdens on the 10 professions.

Using the data they collected, Flanders and Roth created the Red Tape Index, which measures the impact of requirements such as fees, exams, number of hours for training, and the minimum age required for the 10 professions.

If the state rolled back licensing requirements, the researchers found, employment rates for the 10 professions could increase by 5.2 percent.

“Flanders and Roth found that the higher an occupation’s licensing scores on the Red Tape Index, the greater its negative effects on employment,” Jon Sanders, director of regulatory studies at the John Locke Foundation, wrote in a blog post. “This makes intuitive sense. Making something more costly results in fewer people availing themselves of it.”

Occupational licensing reform is a bipartisan issue, and Arizona and Mississippi, for example, have already taken steps to lessen licensing requirements. Sanders argues North Carolina should follow suit.

“We could have faster job growth by eliminating unnecessary licenses. We could also see more employment by trimming back undue licensing requirements,” Sanders wrote. “Good things happen when North Carolinians are allowed greater freedom to enjoy the ‘fruits of their own labor.’”