Ohio’s occupational licensing requirements are burdensome and cost state residents hundreds of dollars each year, members of a Senate panel were told Wednesday.
Proponents testified in favor of a measure, SB 255, to establish sunset provisions for occupational licenses and provide alternatives to licensing.
Micah Derry, state director of the Ohio chapter of Americans for Prosperity, told members of the Senate Government Oversight & Reform Committee that Ohio licenses 40 lower-income occupations and has the 20th most burdensome licensing laws in the country.
On average, according to Mr. Derry, the licensing process entails 350 days of training and $188 in fees.
“Often times these requirements do not come about due to consumers complaining to lawmakers about poor or unsafe service. Rather they are lobbied for by the very industry that wants to be licensed,” he said. “This is so those practicing in the occupation can restrict competition by restricting new entrants into the occupation and as a result, raise prices on consumers. Additionally, trade schools and the associations representing the industries advocate for these licenses because the legislation mandates training and continuing education which guarantees a revenue stream.”
Mr. Derry said licensing requirements cost Ohio households an additional $775 per year.
Under the measure, all licensing boards would be sunset every five years unless reauthorized by lawmakers. Mr. Derry said that provision will create more transparency and accountability.
“The time for opaque and unaccountable license boards has gone on for too long. It is time for this legislature to reassert its authority over occupational licensing in this state and work to grant workers more opportunity while also protecting consumers,” he said, adding the bill will be scored as a key vote.
Greg Lawson, research fellow at The Buckeye Institute, said Ohioans should not have to ask the state for permission to earn a living.
“No one denies that state licensing requirements are needed in some cases and industries to ensure public safety,” he said. “Requiring appropriate education and training for physicians, healthcare providers, pilots, and truck drivers, for example, helps safeguard the general public in our hospitals and on our roads and runways. But these concerns fade quickly when applied to auctioneers, travel guides, and hairdressers – all of whom are subject to Ohio’s byzantine licensing requirements.”
To emphasize his point, Mr. Lawson pointed to the case of Jennifer McClellan, a licensed massage therapist who tried to move back to Ohio to be closer to her family but was denied a license to practice because she was 10 days short of the state’s training requirements.
“Every licensing requirement raises a new red-taped obstacle for workers to clear before earning a living or starting a new career,” he said. “Every hour of unpaid training needed to satisfy bureaucratic requirements is an hour not spent earning tips, impressing a boss, serving a customer, or opening a business. Those are hours of lost productivity, hours of opportunity that young, low-income workers sorely need, but that the state continues to take for itself.”
Sen. Matt Huffman, (R-Lima) requested that Mr. Lawson develop a list of occupational licenses that are not necessary. Chairman Sen. Bill Coley (R-Liberty Twp.) said that effort is already underway.
In written proponent testimony, Brandon Ogden of Small Business Consultants of Ohio said licensing laws disproportionately impact small businesses.
“Given that small businesses are the most fragile and vulnerable employers in the state, it is important that their regulators be assessed and evaluated periodically,” he wrote.