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EDITORIAL: Occupational licensing regulations stifle job creation

How long do you think it takes to train to become a licensed barber in Nevada? A month? Six months? Maybe a year?

Nope. Try 2½ years.

In a recent piece for Politico, Andy Koenig points out that barbers are among dozens of entry- and mid-level professions harmed by out-of-control occupational licensing regulations. Mr. Koenig, a senior policy adviser at Freedom Partners Chamber of Commerce, noted that in some states, the number of professions that require occupational licenses tops 70 — and that’s on top of countless other professions that are licensed at the local government level.

The current requirements for obtaining various occupational licenses not only limit job opportunities for low- and middle-income professionals, but also hinder job creation.

As Mr. Koenig points out, occupational licenses once only applied to professions such as doctors, pilots and lawyers. In the 1950s, for example, 5 percent of jobs were licensed at the state level. Now, that number is 25 percent. With local licensing requirements, more than 1,000 professions are now affected. Not only has the amount of occupational licensing become out of control, but the varying licensing guidelines across various professions are out of whack, as well.

Take emergency medical technicians, for example. EMTs respond to medical emergencies and often save lives. According to a 2012 estimate by the Institute for Justice, the typical EMT license costs $85 and requires 33 days of education and training.

On the flip side, cosmetologists — who provide a valuable but not life-saving service — must be licensed in all 50 states at an average cost of $142, and after more than a year of education and training, including two exams. Commercial carpenters and cabinet makers, who also provide a similarly valuable-yet-optional service, are licensed in 29 states and the District of Columbia, and have to shell out about $300 and spend roughly 450 days in school. As outrageous as those numbers are, however, they pale in comparison to the 890 days it takes barbers to become licensed to cut hair in Nevada.

The time and money involved in getting an occupational license might seem like nothing more than a bureaucratic nuisance, but the hoops that lower-income job seekers have to jump through can actually keep them from pursuing new opportunities. Not only can it be a challenge for them to come up with the money for their license, but they would also have to quit their current jobs to train for the next one — giving up a paycheck to do it. Not surprisingly, one study from 2011 showed that such regulatory red tape prevented the creation of 2.85 million new jobs.

These overreaching regulations and countless others seemingly exist for no reason other than to put state regulators to work. While the Nevada Legislature deserves credit for passing Assembly Bill 409 last year, which dialed back regulations on makeup artists, Nevada and all states must go much further with occupational licensing reform to encourage employment and bolster the economy.

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