Licensing laws a license to hold back workers

by Keli'i Akina, Ph.D. President / CEO Grassroot Institute of Hawaii

Braiding someone’s hair shouldn’t make you an outlaw. But that’s exactly what can happen under Hawaii’s restrictive licensing laws.

I bring this up because I noticed the Institute for Justice, based in Arlington, Virginia, just released the third edition of its “License to Work” study, which looked at state regulations nationwide and concluded that occupational licensing laws are a barrier to entry, so to speak, for many people trying to find work, especially lower-income workers.

The new edition identified more than 2,700 different occupational licenses across the country and found that the average license requires a year of experience, $295 in fees and an exam — on top of hidden costs such as tuition fees for schooling.

Hawaii performed especially poorly in the nationwide comparison, with licenses being required in 64 of 102 lower-income occupations, versus the national average of about 53. It also had the highest level of qualifying burdens, leaving the state ranked fourth-worst overall for its occupational licensing scheme. 

For example, to qualify for a license in Hawaii, the average number of days lost to someone trying to obtain the required education and experience is a whopping 972, compared to the national average of 350. The average fees associated with Hawaii licensing total $506, versus the national average of $284.

Knowing these facts, we can understand why occupational licensing disproportionately affects lower-income workers and small businesses — because it requires them to jump through numerous regulatory hoops before being able to practice their trade.

For people who are barely making ends meet, the prospect of spending hundreds of dollars and a year or more just to get permission to work can be an insurmountable hurdle.

Which brings us back to hair braiders, for which there is a niche market in Hawaii.

The usual rationale for onerous licensing restrictions is that they are necessary to protect public health and safety. That seems reasonable for occupations such as physicians and nurses. It becomes less convincing when the license involves applying makeup or shampooing hair.

When it comes to natural hair braiding — a skill that can be self-taught, is often passed down as part of a cultural tradition and is given little attention in traditional cosmetology schools — the state’s requirement that braiders spend 1,250 hours in school (at their own cost) seems absurd.

The punishment for not having a license seems equally absurd: An unlicensed hair braider, makeup artist or shampooer in Hawaii could be fined up to $100 a day or even jailed. 

In Thursday's Honolulu Star-Advertiser, attorney Jessica Poitras and writer Daryl James of the Institute for Justice explained that there is no data or experience showing that the licensing of niche beauty services protects public health or safety.

Hawaii's state auditor has studied beauty industry licensing five times since 1980, each time concluding that the license is unnecessary. California and Texas have licensing exemptions for hair braiders, and there has been a nationwide trend toward delicensing shampooers and makeup artists. 

“Overall, braiders may practice without a license in 32 states, makeup artists in 14 states, and shampooers in 18 states,” wrote Poitras and James. “Salon visitors remain safe in all of these jurisdictions. During the first 10 years after Mississippi delicensed braiders, for example, the state received zero complaints related to health or safety.”

Over and over, we hear Hawaii policymakers talk about the need to grow the economy and encourage small businesses. Yet, regulations such as occupational licensing only make it harder to succeed. 

Instead, our lawmakers should look for ways to reduce barriers to employment and entrepreneurship. They could start by getting rid of license requirements for beauty services such as hair braiding, makeup application and shampooing.

For some occupations, a less restrictive form of oversight than a license — a simple exam or certification, for example — could be sufficient to ensure public safety.

In general, if we really want to help people get back to work, we need to reduce the time and money it takes to enter a profession. Or, to put it more simply, we need to just get out of the way.