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Deregulation should last post-COVID

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It may seem counterintuitive that any government action within the past two months would be a model policy for promoting economic recovery. The surge in deficit spending and expansion of government authority has been unprecedented. But amid the swell of government was a silver lining: Hundreds of laws and regulations were suspended in response to COVID-19.

In anticipation of worker shortages, states loosened licensing restrictions and requirements that limit out-of-state medical professionals from working in- state. These government barriers make it expensive and time-consuming for medical workers to practice anywhere other than the state in which they obtained their license. They are ostensibly designed to protect public health.

But when laws need to be suspended so that their purported purpose can be accomplished, one thing is clear: It’s time for reform.

Prior to COVID-19, occupational licensing reform was largely an academic exercise. To be sure, the damage caused by sweeping licensing restrictions was real, resulting in fewer job opportunities and higher costs to consumers. But the policy debate was still weighted down with guesswork. How could a policymaker be sure an occupational licensing law wasn’t achieving its shapeless goal of protecting the public health, especially when the in-state practitioner claims the law is necessary to ensure consumer safety? Out-of-state licensing restrictions couldn’t withstand reality, and that seems like a fair metric to evaluate policy.

While it was laudable for states to temporarily lift these restrictions for medical professionals, the question remains—why do these restrictions still apply to any occupation in 2020?

Occupational licensing makes sense among medical professions, but it doesn’t follow that every medical law and regulation makes sense. The same principle applies beyond the medical field.

The inability to move between states has real-world consequences—regardless of profession. Changing jobs and pursuing better opportunities is fundamental to moving up the economic ladder. But because licensing requirements are hardly uniform, moving presents a more difficult barrier in certain occupations.

Consider this: More than 1,000 occupations require a license in at least one state, but fewer than 60 are licensed in every state. Moreover, licensing requirements vary between states, despite little to no evidence that these differences have an effect on safety. Regardless of expertise, professionals with out-of-state credentials may effectively be shut out of a job if they can’t afford to invest the time and money in another costly license.

These restrictions aren’t just affecting medical professionals. These government permission slips—and the associated fees and lengthy education requirements—are needed by cosmetologists, construction workers, tattoo artists, and countless others whose livelihoods have already been affected by the government-mandated shutdowns.

Reform is needed more than ever, as millions find themselves unemployed and turning to the government. The temporary lifts on licensing restrictions from the past two months should be built out and made permanent so that more people can work, innovate and support themselves. Removing burdensome restrictions to work will help ensure that people find jobs, not long-term dependency. States like Arizona and Utah have been leading the way on occupational licensing reform, and Missouri will soon follow suit.

The path to economic recovery begins with less government. As states reopen and task forces convene, policymakers should take advantage of the template they have in front of them to restore economic liberty and let people work.

Haley Holik is a senior fellow at the Foundation for Government Accountability.

Tags Coronavirus COVID-19 Occupational Licensing

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