Maine is in desperate need of occupational licensing reform
Every American citizen should have the right to earn a living and the freedom to pursue the profession of his or her choice. However, an individual’s ability to work and provide for their family is often thwarted by government interference in the form of arbitrary and cumbersome occupational licensing laws.
Occupational licensing exists as a mechanism for government to promote public health and safety by requiring workers to meet specific requirements before practicing in professions that pose legitimate threats to public safety. These requirements include, but are not limited to, attaining a specific level of educational achievement, amassing experience hours within the profession, or paying fees, all for the purpose of obtaining a government-issued license to work and earn a living.
In the early years of occupational licensing, the majority of licensed professions were in the medical field, where the costs related to poor quality service are high and truly endanger public welfare. Over the years, however, these laws have grown to encompass dozens of occupations that pose no legitimate health and safety risk to the general public. By doing so, government has locked millions of American citizens out of primary employment opportunities that could lift them out of poverty and place them on the path to prosperity.
There are a number of economic consequences that come as a result of frivolous occupational licensing laws. The licensing of these occupations establishes a government protected quasi-monopoly where licensed practitioners can charge more for their goods and services without the fear of losing business, as no real competition exists within the marketplace.
This means consumers bear the burden of licensing, as the cost of licensing is passed on to consumers through the inflated cost of goods and services. This is particularly burdensome for low- to moderate-income populations, as licensing forces these consumers to pay for a stay at the Ritz-Carlton when they can only afford the Motel 6.
Licensing also affects rates of entrepreneurship among professionals when imposed on low- to moderate-income occupations that should not require a license. A study by the Goldwater Institute found that “occupational fields that contain the most likely entrepreneurial opportunities for low-income workers are among the most heavily regulated in terms of state-required licensing and experience or degree requirements.”
In 2012, the Institute for Justice found that these licensed low- to moderate-income professions are “often well-suited for individuals just entering or re-entering the economy.” These government barriers prevent self-made entrepreneurs from taking control of their own economic futures.
The state of Maine licenses well over 200 individual occupations, a number of which do not pose any measurable threat to the health and safety of Maine citizens or are rarely licensed in other states. For example, Maine licenses arborists, animal control officers, log scalers and packagers, all of which are licensed in seven or fewer states. Maine also licenses auctioneers, boxers, dietitians, geologists, interior designers and nursing home administrators, however, it remains unclear how the nature of any of these occupations puts the safety and well-being of Maine citizens at risk.
Further, Emergency Medical Technicians (whose work undoubtedly impacts the health and safety of Maine citizens) must attain only 26 days of experience to obtain a license to work, however, log scalers (who estimate the value of logs) must acquire 730 days of experience to practice in their profession. The imbalance within existing occupational licensing laws in Maine, which extends far beyond just EMTs and log scalers, must be rectified in order to give Maine workers a fighting chance.
In early January, The Maine Heritage Policy Center will be releasing its newest white paper, Let Us Work: Resurrecting Entrepreneurship by Removing Barriers to Economic Opportunity, a report that examines the broad economic effects of occupational licensing and explores the impact these laws have on Maine workers and consumers.
To reverse the economic damage that has been done by occupational licensing, Maine and other states should consider The Right to Earn a Living Act, a law that restores an individual’s right to enter the profession of their choice by eliminating licensing requirements that were not carefully tailored to fulfill legitimate health and safety objectives. By removing unnecessary occupational licensing regimes, Maine can reduce the cost of goods and services, unleash the full potential of its workforce and foster an economic climate that gives every Maine citizen a fair shot at achieving prosperity.