Do you want to be a fortune teller in Maryland? Your future better include a license from the state. How about being a hair braider in Mississippi? You'll need 300 to 1,500 hours of training and government permission. Want to sell flowers in Louisiana? Only licensed florists can do that. And almost every state requires certification if you want to move furniture and hang art while calling yourself an interior designer.

We all know some jobs require a license from the state, but most people don't realize how many jobs require them and how sometimes the requirements to get a license are onerous and ridiculous. We'd like to think such licenses exist to protect consumers, but too often, they have slipped into limiting competition. That licensing requirements don’t always exist to protect consumers is most obvious when you consider how arbitrary requirements are from state to state.  Doesn’t it make sense that consumer would require similar protections in neighboring states?  But California has 177 job categories licensed, while if you take one step across the state line into Arizona just 72 careers are licensed. In North Carolina you need a license to do 107 jobs. Next door in South Carolina, only 60 jobs require certification.

Indeed, states like California, Connecticut, Maine and New Hampshire all require job seekers to obtain a license before performing two or three times as many jobs as in states like Missouri, Washington, and Kansas.  Does anyone think, therefore, that consumers are victimized twice as often in Connecticut as Washington?

No, the broad difference in licensing requirements has more to do with successful lobbying by existing business to keep out competition, which winds up restricting consumer choice, destroying entrepreneurship, driving up prices, and reducing job opportunities.  And since many of these jobs--hair stylist, florist, interior decorator, for example--require talent and passion but not formal training, they are great opportunities for those without the benefit of wealth or higher education to start their own business.  Occupational licensing requirements for formal training or high fees raise a formidable barrier to this important channel of upward mobility.

My colleague Adam Summers has done a full analysis of what occupations the 50 states license (see the table below) and discusses the unfortunate effects that often occur. Read it all here.

Ranking the States on Occupational Licensing
States (Number of jobs requiring a license)