FTC Sets Its Sights On Occupational Licensing

The Federal Trade Commission recently announced the rollout of an Economic Liberty Task Force. This major policy initiative’s first focus is on occupational licensing. Given the growing consensus that occupational licensing makes it more difficult for Americans to find work — especially those with low-incomes — this move by the FTC has the potential to increase economic opportunity .

In what follows, Acting Chairman Maureen Ohlhausen explains why the FTC is focusing on occupational licensing reform and what it is doing to promote competition in general.

Jared Meyer: About 1,100 occupations are licensed in the United States. However, only 60 occupations require a license in all 50 states . What can this statistic tell us about occupational licensing?

Maureen Ohlhausen: It means that there is a lot of unnecessary government red tape that isn’t making consumers safer. There are a few occupations out there that most people agree should be licensed. But there are far more occupations — more than 1,000 — where at least one state has decided that a license isn’t necessary to protect consumers. Yet we don’t hear stories about how “if only the state had licensed X,” the public would have been protected from some calamity.

Furthermore, even when multiple states each license the same occupation, those states often impose very different licensing requirements such as the number of months of training required. This uneven licensing of the same occupation and different requirements for the same license across states strongly suggests that many occupational licenses do not advance public health, safety, or other legitimate public protections.