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Does Requiring Professional Licensing Stifle Entrepreneurship? Does Requiring Professional Licensing Stifle Entrepreneurship?

Does Requiring Professional Licensing Stifle Entrepreneurship?

by Liz Dwyer

February 9, 2011


Do too many professions require state-level licensing, or should there be less regulation of certain trades? Some lawmakers say that making people take classes and pay fees to get into certain professions stifles economic growth and simply adds more bureaucratic red tape. On the other hand, a growing number of people employed in specialized fields want more education and licensing requirements. What's an aspiring cat groomer—or locksmith—to do? 

According to the Wall Street Journal, people working in service industry fields say that increasing the amount of education required to get into, for example, personal training or tattoo artistry, will, "boost the prestige of their professions, provide oversight and protect consumers from shoddy work."

Concerns about safety and sanitation in certain occupations are real. New York City recently saw the arrest of a woman charged with giving illegal silicone breast and buttock injections.  And, no one should be getting tattoos done by someone who hasn't been properly trained in the dangers of HIV or hepatitis transmission due to dirty needles.

On the other hand, some education and licensing requirements do sound a bit ridiculous. For example, Texas 

...requires hair-salon "shampoo specialists" to take 150 hours of classes, 100 of them on the "theory and practice" of shampooing, before they can sit for a licensing exam. That consists of a written test and a 45-minute demonstration of skills such as draping the client with a clean cape and evenly distributing conditioner.

Texas' regulators justify the education requirements by saying shampoo specialists need training in neck anatomy and regulating water temperature. But, does someone really need 150 hours of classes to learn how to position someone's head on a shampoo bowl and not run scalding hot water over their head?

The expense of licensing could be a barrier to entry, particularly if you come from a low-income background. For example, in California, the education and licensing fees to become a barber will set you back around $12,000. That's a lot of money for someone who has skills but not the cash to get started in the profession. And because some new licensing requirements only apply to newcomers in a field, there are accusations that they're designed to stifle competition.

Of course, the cost of all those education classes and licensing fees are passed on to consumers, and while the licensed salon may know all the proper shampooing techniques, that doesn't mean you'll always get the highest quality work. Who hasn't walked out of a professional salon with a nightmare haircut? Meanwhile, a visit to an unlicensed acquaintance's kitchen salon can have you looking fly at half the price.

What do you think? Should your neighbor who's really good at clipping your cat's nails be able to become a cat groomer simply by declaring that he is one? Or does it stifle the entrepreneurial spirit of America for him to have to go to school and get certified?

photo (cc) by Brian Teutsch via Wikimedia Commons

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