Interstate compacts aren’t the right way to fix occupational licensing laws

This week, special interests all over the country received a belated Christmas present from the Trump administration. In a joint op-ed, Secretary of Labor Alexander Acosta and Republican South Dakota Governor Dennis Daugaard outlined their plan to push for interstate compacts that allow holders of an occupational license in one state to receive a temporary license for that occupation when moving to another state within the compact.

While offering any ideas to decrease the burden of occupational licensing is laudable, the effect of such policies could actually serve to set back desperately needed reform efforts for years to come.

Acosta and Daugaard correctly pointed out that state occupational licensing requirements — laws requiring would-be market participants to obtain a license from the government before they can engage in certain occupations — have gotten out of control. In 1950, only one out of every 20 American workers required a license to do their job. Today, that number has ballooned to more than one in four occupations, including those such as interior designers and florists. Typically implemented under the banner of “public health and safety,” more than 1,100 different occupations require a license in at least one state.

Sadly, most occupational licenses have become little more than a mechanism for those already practicing an occupation to shape government regulations to raise the barriers to entry for those seeking to enter their field. This results in higher prices for consumers, fewer employment opportunities, and less innovation.

Continue reading at The Hill.