Jestina Clayton grew up in Sierra Leone, a poor country in which the average income is a mere $875 a year. As a child, she learned the hair-braiding traditions of her culture. When she turned 18, she moved to Centerville, Utah with hopes of a brighter future. She eventually found a niche that suited her talents, for while many parents in Utah had adopted African children, few knew traditional hair-braiding styles. Her story seemed to have a happy ending.
That is, until the day when Clayton received a threatening email from someone who had seen an advertisement for her services on a local website. As was reported in The New York Times, an individual cannot braid hair in Utah without two years of formal cosmetology schooling, which costs about $16,000. Furthermore, this mandatory schooling mainly focusses on subjects other than hair-braiding, which is only taught for a couple of months at most, and it does not teach African hair-braiding at all. And even if Clayton completed this schooling, her license would only be valid within the state of Utah if she wanted to braid hair in another state, she would have to go back to cosmetology school and buy another license.
Clayton's situation is not an isolated incident. Sixty years ago, less than five percent of all working Americans were required to have licenses to practice their trade. Today, nearly a third of all workers are employed in fields that require licensing. As a result, many face the same situation as Clayton. In Midway, Ga., three girls had their lemonade stand shut down by the police because of "safety" concerns the police said it was not obvious where the lemonade had been made or what it could contain, NBC reported. Furthermore, even though the girls were operating the stand from their home, they were still legally required to pay for a local permit, which costs $50 per day.
There are two significant problems with the vast expansion of occupational licensing over the past few decades. First, whenever overzealous licensing requirements are enacted, the burden of proof usually falls on the entrepreneurs who are hamstrung by the new requirements, rather than the industry lobbyists who argued for the enactment of these regulations. In Utah, an exaggerated story about hair lice succeeded in convincing the state legislature that all hair-braiders needed to be licensed, even if it cost $16,000 per braider. In order to resolve the problems faced by people like Clayton, the discussion needs to be refocused so that the lobbyists are required to prove not only that a threat is real and significant, but also that the proposed regulations would substantially diminish that risk.
The second problem with the expansion of occupational licensing is regulatory capture. Even when Clayton turned to a well-meaning state representative, who subsequently proposed a bill nullifying the requirement for African-style hair braiding, the only people who came to the hearings were cosmetology professionals and industry lobbyists. Because no one outside the profession even showed up or attempted to provide input, the cosmetology lobbyists' influence easily overpowered Clayton's. Thus, entrepreneurs are forced to either obey the senseless regulations and pay the exorbitant licensing fees or simply leave the market. Regulations made in the name of protecting the public in fact hurt job creation, discourage entrepreneurs and prevent potential customers from receiving goods or services.
Discussions of government regulations seem to inevitably end with liberals defending government attempts to regulate economic activity and conservatives defending the free market. But the issue of occupational licensing necessitates a more fine-tuned approach. If and when a particular regulation is proved useless or counterproductive, it should be repealed. The consequences of a lemonade stand or a hair-braider not having a license are not steep. If, in fact, a particular braider does spread lice, that braider will naturally lose business.
Obviously, there are many professions for which there are strong justifications for occupational licensing. An incompetent airline pilot could easily jeopardize the lives of many. But senseless regulations have proliferated in numerous industries as a result of businesses driven to block newcomers from entering the market and less as a result of the much-touted narrative of public safety. In many cases, occupational licensing regulations do far more harm than good and should be repealed.
