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Licensing contributes to wage gender gap

BY CATHY REISENWITZ
Published:   |   Updated: May 16, 2014 at 11:11 AM

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Two researchers at Utah State University have discovered a factor that may be silently impacting the much-discussed but poorly understood gender wage gap. Lindsey McBride and Grant Patty examined the gender bias of occupational licensing requirements. What they found is that — at least at the lower end of the socioeconomic ladder — women are far more likely than men to need to obtain government permission to work.

The researchers focused on jobs in Utah with median yearly earnings below $40,000, the state’s average, so as to exclude doctors, lawyers, financial professionals, accountants and other specialized professions that are universally licensed. As Economics 21 explains:

“The authors then determined the primary gender of those who worked in the 13 occupations that fell in this category. Their results are clear — in Utah. Approximately 70 percent of the people who needed licenses to work in these professions were women. Of the 13 occupations examined, 9 licensed more women than men and 6 were over 80 percent female. These occupations included dietitians (98 percent female), court reporters (80 percent), cosmetologists (94 percent), and estheticians (96 percent), to name a few.”

Similar results can be seen in public interest law firm Institute for Justice’s state-by-state rankings of licensing requirements. The firm regularly fights on behalf of women whose livelihoods are endangered by regulators. For example, even though African hair braiding involves zero dangerous chemicals or implements, JoAnne Cornwell faced losing her business, Sisterlocks, which provides hair care for African-American women, because she hadn’t spent thousands of dollars and hundreds of hours learning irrelevant, outdated techniques. The truth is Cornwell had developed a new method of braiding that threatened existing businesses.

According to the Institute for Justice, the profession with the most onerous licensing requirements out of all the low- and moderate-skill professions is interior design, an overwhelmingly female field. To design interiors in Florida, Nevada, Louisiana or the District of Columbia costs $364 and requires an average of six years of experience. But it’s hard to understand how ugly rooms threaten public safety.

Right now the Institute for Justice is fighting for Trisha Eck’s right to allow her customers to use her teeth whitener in her office, though a board of Georgia dentists wants to shut her business down. And in Arizona, Celeste Kelly and the Institute for Justice are fighting for her right to operate her animal massage business.

There’s abundant evidence that attempts to mandate equal pay can actually hurt women. Legislation always carries with it unintended consequences, no matter how well-intentioned.

The truth is neither side has it right. The left says the gender wage gap results from discrimination. The evidence for this is shaky at best. The right says the gender wage gap can be chalked up to women’s choices. But this doesn’t take into account government-mandated barriers.

Who knows what choices women might make if they were allowed to work without needing permission slips from, essentially, their competitors? There can be no doubt that up-front costs of thousands of dollars and hundreds of hours to even get started in a profession effectively thwarts many women’s career hopes and dreams. By ignoring the problem of women’s underutilization in the work force, or trying to fix it with overbroad, blunt legislation, we miss opportunities to fight to simply get government out of the way so women can succeed.

Cathy Reisenwitz is a Washington, D.C.-based writer, political commentator and Center for a Stateless Society contributing author.

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