Show-Me Institute researchers have been vocal proponents of reducing government barriers to workers, including hair braiders, park photographers, and many others, and have written on licensing issues for over a decade. We were also supporters of the recent adoption of an interstate licensing regime, which allows individuals who have had an license in a different state for at least one year to have applicable licensing requirements waived in Missouri. While this was a good start, it allows for an excessively long wait time (up to six months) between when an applicant requests a waiver exempting them from a licensing requirement and when the relevant oversight body must either grant or deny the request. Many applicants simply can’t afford to wait six months before beginning work in their chosen field.
A bill introduced in the Missouri Legislature, Senate Bill 88, would build on improving past successes in the occupational licensing sphere. It would strengthen prior licensing reciprocity legislation by reducing the maximum wait time for oversight bodies to waive requirements from six months to 45 days. This bill would also make it possible for Missouri licensing requirements to be waived for workers in states without such requirements provided they have at least three-years of applicable experience.
Ness Sandoval, a professor from St. Louis University, has written that Missouri is in a demographic winter—more people are dying in Missouri than are being born. Pair this finding with declining student enrollment in the state, one can see the need for Missouri to attract workers from out of state rather than put barriers in their path.
Against the substantial cost of licensing requirements we need to weigh the potential benefits to the quality and safety of products/services, but evidence of such benefits is underwhelming. The Mercatus Center at George Mason University conducted a meta-analysis of 19 different studies in Florida directly related to licensing and product quality. In 16% of these studies, researchers observed positive relationships between licensing and product quality, in 21% they observed a negative relationship, and in 63% they observed no relationship.
The Institute for Justice has identified nine occupations that Missouri licenses but are not licensed by at least 15 states throughout the country. For example, Missouri is one of 22 states that require a license to work as a sign-language interpreter—which entails $442 in fees, 60 credit hours of education, and two exams. Under current statute, if a sign-language interpreter with three years of experience from Kansas, Tennessee, Texas, Oklahoma, Florida, or Ohio wanted to move to Missouri, they would have to spend the time and money to acquire a license before they could work here. The same would be true for an experienced veterinary technician from one of the 15 states that don’t require a license.
Occupational licensing increases costs to consumers, limits competition, and by its nature involves government in the free market. In some cases (e.g., physicians), such costs may be justified in order to ensure the safety of the public. But policymakers should look for ways to limit the burden of licensing to cases in which it is absolutely necessary. Embracing the policies embodied in Senate Bill 88 would be a step in this direction,
