Licensing reform bills cut red tape, aid CT economy

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If there were a proposed policy that would create more jobs in our state, would you support it? If you could cut taxes and regulations on small businesses and entrepreneurs, would you do it? If you could help ex-offenders stay in a job and out of prison, would you help them?

Thankfully, the General Assembly is considering two licensing reform bills that would accomplish these goals by cutting red tape.

State-mandated occupational licensure has been linked to lower rates of entrepreneurship among low-income individuals, high prisoner recidivism rates, and sluggish job growth. Reforming licensure to reduce burdens on people who just want to work is not only fair for individual workers, but good for the state.

As a state suffering a dearth of jobs, Connecticut should eliminate barriers to work, such as unnecessary licensing requirements. The Federal Trade Commission’s new Economic Liberty Task Force recently commented on occupational licensing, saying “Even modest licensing requirements can and do deter people from entering fields they might otherwise wish to pursue. In effect, excessive licensing acts as a state-created barrier for people seeking work.”

Many of Connecticut’s state-imposed license requirements are merely job taxes. There are often no training, education, or testing requirements, just a fee. If someone merely pays a fee they can become licensed, whether or not they can do the job. This begs the question: are all occupational licenses necessary for consumer protection?

Remember that the purpose of government is not only to protect public health and safety, but also to preserve and protect liberty. Therefore, the state’s policy should be to always employ mechanisms that are the least restrictive to individual liberty and economy. Too often, however, a license is the most restrictive means of accomplishing that end, not the least.

Senate Bill 191, which swiftly passed the Senate and awaits a vote in the House, would repeal six obsolete and unnecessary occupational licenses, an excellent first step in cutting some of the red tape tangling up entrepreneurs and people starting their careers.

House Bill 5764 will make it easier for ex-offenders to become barbers or hairdressers in the state by reforming the state’s licensure process relative to criminal history. This bill does not make any imposition on employers, merely preventing the state from disqualifying applicants solely because of their past.

The state is in desperate need of pro-growth reforms to boost the economy. Unfortunately, thanks to the ever-growing state budget crisis, the fundamental tax reform so desperately needed will have to wait until the state can tackle structural spending and budget process reform.

These licensing reform bills will boost employment, particularly for segments of the population that suffer disproportionately high levels of unemployment and poverty. Just as important, both bills were scored by the state’s Office of Fiscal Analysis as saving the state money. It is a chance to do something good for the people of Connecticut without asking for more of their hard-earned money.

With so little time left in session, now is the time to support bills that will help get people back to work in Connecticut. With two small, revenue-positive bills, the state can accomplish a lot of good. All it will take is a vote.

Joe Horvath (@JAndrewHorvath) is the Assistant Policy Director of the Yankee Institute, Connecticut’s free-market think tank. His work has appeared in National Review Online, Bloomberg BNA, and Tax Notes.

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