The Chairman of the President’s Council of Economic Advisors testified February 2 on occupational licensing before a United States Senate Subcommittee. The White House’s chief economist Jason Furman noted, “The share of the U.S. workforce covered by State licensing laws grew from less than 5 percent in the early 1950s to 25 percent by 2008.” Furman warned that the growth of licensing restricts opportunities. The chairman’s timely testimony is especially relevant for the state of Ohio, given that its state senate will vote February 9 on this issue.

The Buckeye Institute reported on the excessive regulations and requirements that were attached to gaining cosmetology licensure in Ohio. Tom Lampman found that the state mandates a hefty 1,500 hours of training, which has an estimated cost of anywhere from $6,500 to $10,000. That is to say, if one were interested in getting paid to braid hair or paint nails in the Buckeye State, but didn’t have the upfront costs lying around, they might as well sell their car to make up the difference.

Furman focused on the distinction between practices that threaten the livelihood of consumers and those that don’t. The chairman juxtaposed the idea of consumers preferring their physician to be certified, but not caring if their cosmetologist was, as there is no threat to their health in the case of the latter. This too was a point made by Lampman when he brought the cosmetology requirements of two other prominent states to the forefront. “New York and Massachusetts license cosmetologists with 500 fewer hours of training than Ohio, and neither state seems to be suffering from many hair-dye-related injuries,” wrote Lampman. Both Furman and Lampman identified this as bad policy.

Why does all of this matter, though? It comes down to this: Ohio’s current policy is creating an inefficient market that is bad for Buckeye business and worse for employees. Furman summed it up as follows, “Licensing requirements can create benefits for licensed practitioners at the expense of excluded workers and consumers—increasing inefficiency and inequality…they can also reduce employment opportunities and depress wages for excluded workers.” These upfront licensing costs are chasing off the entrepreneurs of Ohio that would like to braid hair or paint nails without having to pay thousands of dollars in upfront, unnecessary expenses. Those who cannot afford these costs simply don’t open up for business or cannot get a job promotion. This results in higher costs for consumers, as it stifles competition in the market. Getting rid of Ohio’s cosmetology manager’s license is an opportunity for Ohio to take one small step to reducing the growth of licensing laws that worry Chairman Furman.