Talk to anyone in state government and they’ll confirm Mississippi is in a high-stakes competition to attract jobs and talent. A strength of our federal system of government is that it encourages states to compete with — and learn from — each other. We can’t stop innovating and improving or we will fall behind. One of the lessons of the last few years is labor freedom matters. For many decades, Mississippi has encouraged labor freedom by supporting the right to work.
We have lost that edge. Today, we are one of the most regulated states in terms of labor. This is not because of unions, but because so many occupations in Mississippi require a person to be licensed before they can work. Obtaining such a license can be a time-consuming, complicated, expensive process.
Often when people use the phrase “right to work,” they mean employees cannot be forced to join or pay for a union. Mississippi guaranteed the “right to work” in 1954, becoming the 15th state to do so. Today, there are 28 right-to-work states. Right to work is a great policy for recruiting companies to Mississippi. But as more states reject forced unionization, we need a new tool to stand out from the pack. We need a new tool to revitalize homegrown entrepreneurship and prosperity.
Only 56 percent of Mississippi adults are working — the second-lowest labor participation rate in the country. Could occupational licensing be playing a role in discouraging work? According to the Institute for Justice, we license 55 of 102 low-to-middle-income occupations — fifth most in the country. Consider that Mississippi is one of only nine states to license residential drywall installers and a host of other construction-related professions, ranging from terrazzo contractors to landscape workers. Economists estimate licensing requirements increase prices by as much as 18 percent. On a $100,000 home that translates into $18,000 in additional costs.
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Nationwide, the burden of occupational licensing has exploded from covering 5 percent of the work force in the 1950s to nearly 30 percent today, according to a 2015 report from the Obama administration. In many ways, we have replaced unions with occupational licensing boards. These boards determine who can work in a chosen field and require workers to pay a licensing fee so they can work. Imagine, in a state where there are not enough jobs and not enough people working, we require individuals in numerous professions to pay a fee for the “privilege” to work.
The opportunity to work is not a privilege, it is a right. This basic principle explains a recent Supreme Court decision, NC Dental Board v. FTC, which ruled occupational licensing boards that “restrain trade” can be sued under antitrust law. Until that ruling, these boards were protected from lawsuits by the doctrine of sovereign immunity.
The rationale for occupational licensing is to protect consumer safety. But all too often, observed the Court, licensing protects monopolies — whether it be dentists who want to dominate the teeth-whitening trade or cosmetologists who want to control hair braiding.
HB 1425, a bill pending in the state Legislature, would require some two dozen of the state’s occupational licensing boards to use “the least restrictive regulation necessary to protect consumers from present, significant and substantiated harms that threaten public health and safety.” These boards are stacked with what the Supreme Court calls “active market participants,” and so no longer enjoy state antitrust legal immunity. The remedy, says the Court, is to place the boards under the “active supervision” of the state. HB 1425 does this by authorizing elected officials to actively supervise the boards.
The right to work is not a legal construct or a marketing gimmick. Productive work aimed at sharing one’s gifts with others — whether it be making cabinets or repairing doors or installing drywall (trades licensed in Mississippi but not in some other states) — is a fundamental human activity that helps us become who we were made to be. Mississippi lawmakers should side with the Supreme Court in letting people work in their chosen professions without having to get the permission of their competitors.
Jameson Taylor Ph.D. is vice president for policy at the Mississippi Center for Public Policy.