Jackson: North Dakota's occupational licensing needs improvement
In many ways, North Dakota was and continues to be a beacon for the American Dream. That is, the belief that people can work hard to achieve upward social mobility and prosperity from humble roots. Unfortunately, for much of the country, includin...
In many ways, North Dakota was and continues to be a beacon for the American Dream. That is, the belief that people can work hard to achieve upward social mobility and prosperity from humble roots. Unfortunately, for much of the country, including North Dakota, burdensome occupational licensing has created a barrier to the American Dream.
The Institute for Justice released a recent report, "License to Work," which analyzed the burden of occupational licensing on workers in all 50 states and the District of Columbia. They reviewed 102 lower-income occupations and found that North Dakota licenses 65 of them. This is considerably more than the national average (54) and the number of occupations licensed by our neighboring states-Minnesota (34), South Dakota and Montana (32) and Wyoming (26).
The good news is that even though North Dakota licenses a lot of occupations, the average burden of its requirements is relatively low - ranking 49th out of 51. The burden is calculated by combining data on the fees required to obtain a licensure, the number of exams that must be passed and education and experience requirements.
Taking into account both the quantity of licensed occupations and the burden of the requirements, North Dakota ranks as the 23rd worst state for licensing on low-income occupations. This leaves plenty of room for improvement.
Proponents of occupational licensing have argued that strict requirements increase public welfare. However, only 10 of the 102 occupations are licensed everywhere (bus drivers being one such example), and 79 occupations are licensed in fewer than 40 states.
One such example are shampooers-people who "shampoo and rinse customers' hair." This job is licensed in 37 states, including North Dakota. How the residents of Minnesota survive without licensing this occupation is a mystery. Here in North Dakota, we can rest peacefully knowing that our shampooers face $185 in fees and 420 calendar days of lost labor due to education and experience requirements.
Shampooers are just one of many occupations overburdened by licensing requirements. The workers who face the highest burden are sign language interpreters. North Dakota requires more than four years of education and $675 in exam fees, while 30 other states have no licensing requirements.
Compare that to the paltry $80 in fees and 35 calendar days of education and experience required to become a licensed EMT in North Dakota. EMT's hold lives in their hands, and yet it is more onerous to become a shampooer or sign language interpreter than an EMT.
These unnecessary and arbitrary conditions place a financial burden on anyone pursuing low-income occupations. Instead, the state should repeal its restrictive regulations, or-when government regulation is necessary-replace them with less restrictive alternatives such as inspections or voluntary certification. This would promote growth and opportunity for people willing to work for a better life. It could also increase access to services as more people in rural areas consider pursuing these occupations.
North Dakotans have long-embraced a strong work ethic and spirit of entrepreneurship. It's time for the state to stop putting roadblocks on the path of the American Dream.
Jackson is the director of the NDSU Center for the Study of Public Choice and Private Enterprise