To let entrepreneurs flourish, policymakers should overhaul burdensome licensing laws.
Once limited to vocations like medicine and dentistry, occupational licensing has skyrocketed in recent years. Today, nearly one in three Louisiana workers needs either a license or certification before they can legally work. But in the 1950s, that figure was one in 20.
Many harmless trades are licensed in Baton Rouge. Auctioneers and arborists both need a government permission slip to work. Contractors who install or repair fences must have at least one year of experience for their licenses. And anyone who wants to build or install swimming pools first needs three years of “active experience in the field.” By comparison, emergency medical technicians — who quite literally hold others’ lives in their hands — need only 41 days of experience.
Licensing red tape ensnares even more workers on the state level. Take Lata Jagtiani, who runs an eyebrow threading salon in Metairie. Even though threading eyebrows isn’t taught in many cosmetology schools, the Louisiana Board of Cosmetology fined her small business nearly $5,000 for employing threaders who didn’t have an esthetician license. That license requires at least 750 hours of training. Lata now think it’s easier for her to open a business in her native India than in Louisiana. To vindicate her rights, she and the Institute for Justice sued the Board in August; their lawsuit is still pending.
Other licenses in the Pelican State border on the absurd. Louisiana is the only state to licenses florists and just one of three states that forces interior designers to be licensed. Even monks aren’t safe: It took five years and a federal lawsuit before a Benedictine monastery in Covington won the right to sell simple, hand-carved wooden caskets without a funeral director’s license.
All in all, Louisiana is the eighth “most extensively and onerously licensed state,” according to a 2012 report by the Institute for Justice. Those regulations jack up prices: The Heritage Foundation found that occupational licensing costs the average Louisiana household $940 each year. By eliminating licenses or reducing their burdens, lawmakers can let workers and consumers prosper.
All too often, what the government does goes unquestioned. When confronted by a policy that cripples growth or just doesn’t make much sense, citizens and policymakers alike should ask, “Why? Why is the government doing this?” A simple change in mindset, from “we should regulate this” to “why are we regulating this?” can have an enormous impact for economic opportunity.
Institute for Justice