One of the biggest hurdles to interstate movement is the fact that states often don’t recognize occupational licenses issued by other states. So many people have to get a new license each time they move from state to state. When a person with a professional license moves to another state, she may have to spend hundreds or thousands of dollars in application fees and take hundreds of hours of mandatory training just to get a new license to keep doing the same job she already did for years in another state.
So licensing requirements make it harder to move to a state with lower living costs or better paying jobs.
Governor Jenniffer González Colón has the opportunity to sign into law a licensing reciprocity bill—almost identical to ones adopted by at least 26 states over roughly the past decade—that would allow anyone with a license in the continental US to apply for the same occupational license if they move to the island. That would allow them to skip duplicative training and avoid retaking the same exams they’ve already passed. This bill applies to over 30 occupations, covering the gamut from physicians and nurses to electricians and cosmetologists….
Puerto Rico has been suffering an amazingly high population loss—a nearly 12 percent reduction since 2010. For an island trying to right the ship after the debt-driven bankruptcy of the government and the devastation of Hurricane Maria, a start to lowering the licensing barriers is a small but important step toward future economic and population growth.
Housing costs in Puerto Rico are usually lower than in the continental United States. That could be a reason to move there. But people will be reluctant to move to a place where they can’t work and thus can’t find a job that pays the rent — especially a place like Puerto Rico that has a higher unemployment rate and a higher homicide rate than most of the United States.
Back in the 1950s, just 4 percent of Americans needed a license to work in 1950. Now, 30 percent of Americans need a occupational license to work. Licensing requirements have spread like kudzu.
The harm from excessive occupational licensing regulations is so obvious that it has been noted by the administrations of Donald Trump, Kamala Harris, Barack Obama, and Joe Biden, all of which recognized the need to cut back on occupational-licensing restrictions. “During the Obama administration, the Department of Labor and the White House Council of Economic Advisers published a lengthy report on licensing laws, and called for states to take action to remove unnecessary barriers to work. ‘Licensing restrictions cost millions of jobs nationwide and raise consumer expenses by over one hundred billion dollars,’ it concluded.”
Organizations like the Institute for Justice note that some licensing requirements violate freedom of speech, by requiring licenses for jobs that are purely expressive (such as tour guides and professional counselors), even when the licensing requirement just drives up costs to consumers and does little or nothing to increase the quality of services provided.
Three states mandate useless “inclusivity” training for cosmetologists, making it more costly to be a cosmetologist while teaching them useless DEI buzzwords.
The Wall Street Journal reviewed a fascinating and disturbing book about occupational licensing, Rebecca Haw Allensworth’s The Licensing Racket:
Most people will concede that licensing for hair braiders and interior decorators is excessive while licensing for doctors, nurses and lawyers is essential. Hair braiders pose little to no threat to public safety, but subpar doctors, nurses and lawyers can ruin lives….Governments enact occupational-licensing laws but rarely handle regulation directly—there’s no Bureau of Hair Braiding. Instead, interpretation and enforcement are delegated to licensing boards, typically dominated by members of the profession…The outcome is predictable: Driven by self-interest, professional identity and culture, these boards consistently favor their own members over consumers…
At the Tennessee board of alarm-system contractors, most of the complaints come from consumers who report the sort of issues that licensing is meant to prevent: poor installation, code violations, high-pressure sales tactics and exploitation of the elderly. But the board dismisses most of these complaints against its own members, and is far more aggressive in disciplining unlicensed handymen who occasionally install alarm systems….“the board was ten times more likely to take action in a case alleging unlicensed practice than one complaining about service quality or safety.”…similar patterns [exist] among boards that regulate auctioneers, cosmetologists and barbers. Enforcement efforts tend to protect turf more than consumers. Consumers care about bad service, not about who is licensed, so take a guess who complains about unlicensed practitioners? Licensed practitioners….it was these competitor-initiated cases, “not consumer complaints alleging fraud, predatory sales tactics, and graft,” where boards gave the stiffest penalties.
You might hope that boards that oversee nurses and doctors would prioritize patient safety, but Ms. Allensworth’s findings show otherwise. She documents a disturbing pattern of boards that have ignored or forgiven egregious misconduct, including nurses and physicians extorting sex for prescriptions, running pill mills, assaulting patients under anesthesia and operating while intoxicated.
