By Donald C. Fry
While business climate surveys almost always rank Maryland highly for its workforce, our state’s generally less-than-stellar rankings for regulatory environment won’t be improved by a new report on occupational licensing.
Maryland has the 10th “most-burdensome” occupational licensing laws in the nation and is the 14th “most extensively and onerously licensed state,” according to a national study, “License to Work,” that was published in May by the Institute for Justice, an Arlington, Virginia-based civil liberties organization.
The study examined how states license 102 moderate-income occupations throughout the United States. For 42 such occupations, Maryland requires licenses costing between $5 and $775. Twenty of the moderate-income occupations that are required to be licensed in Maryland are subject to license requirements in fewer than half of the other states, according to the report.
“If you want to work in one of the 42 occupations licensed in Maryland, you may need to meet a minimum age requirement, demonstrate a certain level of often irrelevant experience and training, pass an exam that may have little to do with your job, and pay a licensing fee,” writes Ronald Fraser in a May 31 Baltimore Sun commentary that summarizes the report.
Admittedly, the study’s publisher, Institute for Justice, is not what most would describe as a moderate or mainstream organization in today’s socio-political environment. It’s a government-bashing, civil liberties law firm that columnist George F. Will once described as “a merry band of libertarian litigators,” according to its web site.
Nevertheless, some compelling points are made in the institute’s 203-page report.
It noted significant inconsistencies and irrationalities among Maryland’s licensing requirements.
For example, Maryland mandates licenses for 15 moderate-income occupations that 39 or more other states do not require to be licensed — including upholsterer, packager, tree trimmer, farm labor contractor, social and human services assistant, and 10 occupations relating to home repair.
“Onerous burdens for home repair and improvement trades account for much of Maryland’s poor showing in the rankings,” the report states.
Only 10 or fewer states even license residential contracting work. Maryland requires two years experience and a licensing fee of $379 for each of the following occupations: painting contractor, mason contractor, insulation contractor, drywall installation contractor, cement finishing contractor, terrazzo contractor, sheet metal contractor, carpenter/cabinet maker and floor sander contractor, according to the report.
The report does concede that licensing some occupations, such as emergency medical technicians, that relate directly to public health and safety is sensible. However, in addition to EMTs, only seven other moderate-income occupations for which Maryland requires licenses – cosmetologist, pest control applicator, school bus driver, city bus driver, and vegetation pesticide handler – are also regulated by all other states, the report notes.
Meanwhile, many Maryland requirements and fees for various licenses appear to defy logic. The most expensive license among our state’s moderate-income regulated occupations is born by massage therapists, who must pay $775 and accumulate two years education and/or experience to obtain a license – the “harshest” such requirement of the 39 states that license the occupation, according to the report.
Conversely, 12 moderate-income occupations require license fees of $75 or less in Maryland including EMT, barber, skin care specialist, child care worker, travel guide, security guard, and milk sampler, the report states.
The amount of education or experience required to obtain occupational licenses in Maryland varies widely. While occupations such as preschool teacher and social and human services assistant require four years of education or experience, the occupation of earth driller requires five years, and tree trimmers require three years. All of the residential contractor licenses require at least two years of education or experience – the equivalent of an AA degree. Pest control operator and vegetarian pesticide handlers require a year of education or experience to be licensed.
Ten occupational licenses require no experience and no exam, including security alarm installer, travel guide, fisher, security guard, and animal trainer.
Maryland’s moderate-income occupational licensing system appears to be a hodge-podge of disjointed requirements.
This is a business climate issue worth examining. The Institute for Justice ranks only one mid-Atlantic state – Virginia – as having more burdensome requirements than Maryland. Two states bordering Maryland – Pennsylvania and Delaware – rank among the 10 least burdensome states for occupational licenses, according to the institute’s report.
Promulgating licensing requirements for moderate-income level occupations that are directly related to public health and safety are reasonable to protect the public good. But putting up unreasonable or artificial barriers to viable occupations does not constitute a regulatory policy that is streamlined, reasonable and relevant – a key core pillar of a competitive environment for economic growth and job creation that was developed by state business leaders and economic developers and compiled by the Greater Baltimore Committee in its report, “Gaining the Competitive Edge.”
In addition to artificially thwarting potential job creation, such policies misdirect, to unneeded licensing review, valuable personnel and resources within fiscally-strapped state agencies that could be applied to other occupational oversight relating more directly to public safety and health.
The Institute for Justice’s report suggests a three-way test for identifying occupational licensing policy in need of reform:
• Is an occupation unlicensed in other states?
• Are the licensure burdens for an occupation high compared to other states?
• Are licensure burdens high compared to other occupations with greater safety risks?
Finding a job or creating a new job “should not require a permission slip from the government” for occupations where public safety or health is clearly not at risk, contends the institute’s report.
For many occupations, viable options to government licensing could include certification through widely-recognized professional associations or validation by third-party consumer organizations such as the Better Business Bureau that help consumers sort through service providers, the report suggests.
Governor O’Malley’s web site proclaims “creating and saving jobs” as the Number One priority of his administration. This is absolutely the right focus for our state’s government. It recognizes that it is the private sector that will drive Maryland’s economic growth.
Toward that end, it’s incumbent on lawmakers and state agencies to ensure that Maryland policies and regulations embody a commitment to a competitive business environment that fosters job creation.
In March, Governor O’Malley submitted 131 state regulations he proposes to repeal, revise or streamline to the General Assembly’s Administrative, Executive and Legislative Review Committee.
The review by state agencies that produced the list, however, did not touch on regulations regarding occupational licensing. The findings of the Institute for Justice suggest that this, too, may be fertile territory in Maryland for thorough and conscientious scrutiny.
Donald C. Fry is president and CEO of the Greater Baltimore Committee. He is a regular contributor to Center Maryland.
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