A missed chance for bipartisanship on licensure reform

Gov. Evers vetoes bill that would've helped aspiring certified nursing aides and eased shortage in Wisconsin

By CONOR NORRIS and ED TIMMONS | December 11, 2019

Occupational licensing has increased dramatically since the 1950s, rising from 5% of the workforce to more than 20%. Today in Wisconsin, to work in more than 240 occupations, aspiring professionals are first required to obtain a license from the state. Overly strict occupational licensing regulations can harm consumers, workers, military spouses and former inmates.

That’s why it’s disappointing that Gov. Tony Evers recently vetoed a bipartisan bill that would have streamlined the licensing process for aspiring certified nursing aides (CNAs) in Wisconsin. The legislation would have brought Wisconsin’s clinical training and experience requirements in line with federal standards, helping to address the state’s CNA shortage, especially in rural counties.

Backed by both Republicans and Democrats in the Legislature, the bill represents a nationwide trend that hasn’t always been apparent in Wisconsin: Occupational licensing reform is a bipartisan issue.

In our home state of Pennsylvania, Democratic Gov. Tom Wolf has been leading the charge to remove burdensome regulations that prevent low-skilled Pennsylvanians from earning a living. Former Vice President Joe Biden has been a vocal opponent of occupational licensing on the campaign trail for the Democratic presidential primary.

This should come as no surprise; the Obama White House conducted a study on occupational licensing in 2015, and the Department of Labor under both President Barack Obama and President Donald Trump has given grants to states to explore possible reform. The 2015 study indicated that occupational licensing has little to no impact on the quality of services provided to consumers. This is quite surprising since the protection of consumers is the purported primary purpose of licensing.

Unfortunately, the stated purpose often differs from the actual purpose. It’s rarely consumers or consumer protection groups that lobby for licensing requirements. Licensing campaigns are almost always led by professional associations made up of practitioners who recognize that licensing increases their wages and stifles competition. These same associations call for increasing education requirements while allowing current professionals to bypass the new licensing requirements.

It’s hard to disagree that workers earning more pay is a good thing, but that isn’t the case when we artificially increase one group’s wages at the expense of others. While licensing increases the wages of professionals who are able to obtain their license, it blocks others from pursuing the profession, forcing them to take lower-paying jobs or face unemployment. In fact, research confirms that occupational licensing reduces labor supply by 17% to 27% — as evidenced by the CNA shortage in Wisconsin.

Acquiring a license can be a significant burden for low-skilled workers who lack the time and money to take courses and pay fees to secure a license. CNAs in Wisconsin, for instance, must complete 120 training hours, compared with the federal requirement of 75 hours. Neighboring states also require fewer training hours for CNAs than Wisconsin.

The price increases that result from licensing hit the poor the hardest and can keep essential services out of their reach.

Because licensing laws are passed at the state level, they also reduce worker mobility. Reapplying and meeting new licensing requirements can be a serious hardship for someone moving to a new state. Practicing, licensed CNAs in Minnesota, for instance, would require at least another 45 hours of training if they moved to Wisconsin. Licensure also disproportionately affects military spouses, who move more frequently and work in licensed occupations at a greater rate than the overall population.

Licensing reform is not a partisan issue. The costs of occupational licensing are real, and the residents of Wisconsin would be better served by alternatives that lower barriers and foster healthy competition.

Conor Norris is a research analyst with the Knee Center for the Study of Occupational Regulation at Saint Francis University, where Dr. Ed Timmons is director. Timmons is also a visiting fellow with the Badger Institute.

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