What if Mothers Needed Licenses?
Do American mothers face labor market discrimination? The answer is yes, but not in the way most people think. With all the political theater surrounding the misleadingly-titled Paycheck Fairness Act, one area where women face real discrimination is often overlooked—occupational licensing.
Lindsey McBride and Grant Patty of Utah State University decided to explore the gender bias of occupational licensing requirements—laws that require people to obtain the government’s permission to work. Their research was presented at the Association for Private Enterprise Education’s 2014 Annual Conference.
McBride and Patty used microeconomic data from Utah for their study. After aggregating all the occupations which require a state license, they selected those that had median yearly earnings below $40,000 (Utah’s average). The reason they choose occupations with earnings under the state’s average is to exclude doctors, lawyers, financial professionals, accountants, and other specialized professions that are universally licensed. The authors then determined the primary gender of those who worked in the thirteen occupations that fell in this category.
Their results are clear—women are most adversely affected by occupational licensing laws in Utah. Approximately 70 percent of the people who needed licenses to work in these professions were women. Of the 13 occupations examined, 9 licensed more women than men and 6 were over 80 percent female. These occupations included dietitians (98 percent female), court reporters (80 percent), cosmetologists (94 percent), and estheticians (96 percent), to name a few.
While their results only evaluated Utah, the national picture is similar.
The Institute for Justice, a public interest law firm that fights against expansive occupational licensing requirements, ranked each state according to its licensing requirements. Utah was found to have the 12th most oppressive policies.
Some of IJ’s most prominent cases are in the defense of women from over-zealous state regulators. In 1999, Dr. JoAnne Cornwell, a San Diego woman who practiced African hair braiding, was in danger of losing her hairstyling business, Sisterlocks. California required cosmetologists to spend 9 months in training and over $5,000 to get the state’s approval to work. Cornwell could not afford the large time and financial costs necessary to receive a license, and doing so would not benefit her work at all.
California’s compulsory training and fees were especially pointless for African hair braiders since they naturally braid hair by hand—there are no chemicals or dangerous instruments that could pose threats to the public. The classes students would be forced to take did not teach hair braiding, and the techniques taught were damaging to African hair. IJ successfully challenged California’s licensing law in 1999, but the fight against labor market discrimination is far from over.
My mother is an interior designer in Illinois. Thankfully, she did not try to enter the profession in Nevada, Louisiana, Florida, or the District of Colombia, as she would have needed a license to do so. IJ ranked interior designers as having the most onerous licensing requirements out of all the low- and moderate-skill professions. The average fee required to work in these four jurisdictions is $364. This may seem high, but the real cost is in the average of six years of required experience. Since occupational licensing’s main justification is protecting public safety, one is left wondering why these burdens are so high. I, for one, have never heard of anyone being injured by mismatched pillows or ugly rugs.
The second most heavily licensed occupation is preschool teachers. According to the Bureau of Labor statistics, 97 percent of early education teachers are women. The discrimination against women continues.
Despite proponents’ claims, the real motivation behind most occupational licenses is not protecting public safety—it is the protection of entrenched interests’ profits. When the barriers to entering an industry are unreasonably high, the number of practicing professionals is constrained. This leads to an artificially small supply of talent, and those lucky enough to be grandfathered in can charge much higher prices. Both consumers and would-be practitioners are harmed for the special protection of a select few.
As those in politics and the media continue to push the flawed statistic that women earn 77 cents on every man’s dollar, it is important to see where the real “war on women” is taking place. Government economic policies that limit opportunities to work have a disproportionate negative effect on women.
Overcoming entrenched interests is difficult, but this is no excuse for inaction. States need to focus on rolling back occupational licensing in order to create equal opportunity for our nation’s working mothers trying to support their families. On Mother’s Day, in the year 2014, there is no reason for any level of government to systematically discriminate against women.
Jared Meyer is a policy analyst at Economics21 at the Manhattan Institute for Policy Research. You can follow him on Twitter here.
Interested in real economic insights? Want to stay ahead of the competition? Each weekday morning, e21 delivers a short email that includes e21 exclusive commentaries and the latest market news and updates from Washington. Sign up for the e21 Morning eBrief.