An Oklahoma Department of Labor task force studying the effects of occupational licensing will send its final report to Gov. Mary Fallin in December, after receiving advice from the public and policy experts.
Fallin established the Occupational Licensing Task Force in the Oklahoma Department of Labor (DOL) in December 2016 to study and make recommendations on reforming government restrictions on who may and may not enter jobs in the state.
The Task Force, headed by DOL Commissioner Melissa Houston, held public hearings in August 2017, requesting input from the public and other stakeholders on how occupational licensing affects Oklahomans.
On October 22, Norman (Oklahoma) Transcript editor Caleb Slinkard interviewed Houston about the Task Force’s work. The Task Force’s December report will recommend creating a database tracking occupational licensing standards and a set of guidelines for lawmakers evaluating licensing standards.
“The final report is due in December, and we’ll have a series of recommendations, but I see two [significant things] taking shape,” Houston told Slinkard. “The first is the creation of a database of occupational licenses.… We’ve spent time collecting information and we’re going to create a public database of all of the licenses, who issues the license, how much revenue it generates, the training level required, the statute, and the five year cost. The second is a blueprint, which is currently available on our website, that policymakers can use to determine whether or not we need a license.”
Keeping Competition Out
Trent England, executive vice president of the Oklahoma Council of Public Affairs, says occupational licensing benefits established players.
“Like most regulations, licensing benefits those already in business, because it makes it harder for upstarts to come along and compete with them,” England said. “It can make it harder to do the same work in a new way, benefiting those who are less creative by burdening those who are forward-thinking and more entrepreneurial.”
Consumers Affected, Too
Occupational licensing harms consumers as well as job-seekers, England says.
“It’s important to recognize that licensing laws can hurt consumers as well as help protect them,” England said. “When government limits who can provide a good or service, this can prevent consumers from getting better-quality goods or having access to new innovations. It stifles competition, the very force that pushes prices down, quality up, and innovation forward.
“Not only can a freer market better protect consumers than restrictive licensing regulations, it can save consumers from the harmful effects those regulations often have,” England said.
Reducing Economic Mobility
Timothy Terrell, an economics professor at Wofford College, says occupational licensing rules can reduce individuals’ geographic mobility and the economic competition it would otherwise create.
“One of the problems that licensure has created is a reduction of mobility for people in licensed professions,” Terrell said. “We have one-fourth of Americans that have to have some kind of government permission to do their jobs. When you tell them they’re certified in one state but have to jump through a lot of hoops to get licensed in another state, that restricts their mobility. If you look at the statistics on worker mobility in the United States, it’s pretty low. There’s not much movement across state lines. This might be part of the reason for that.”
Consumers Know Best
Consumers are better at determining service providers’ qualifications than government boards and commissions, Terrell says.
“Consumers are pretty good judges of the competency of the provider,” Terrell said. “And yet the state is standing in the way of entrepreneurs who want to get into that profession, for no other purpose than just to protect the incomes of those who are already there.”