Baylor hosts business Free Enterprise Forum

Dr. Morris Kleiner speaks to students and faculty about occupational licensing. Photo credit: Liesje Powers

Megan Rule | Staff Writer

Dr. Morris Kleiner spoke Thursday evening at Paul L. Foster Campus for Business and Innovation about his recent book, “Guild-Ridden Labor Markets: The Curious Case of Occupational Licensing” and the issues with occupational licensing, a form of government regulation that impacts more than unions or the minimum wage. Kleiner’s speech was a part of Baylor’s Free Enterprise Forum.

“Why should you care? Well, it’s important for the economy because it’s a much bigger part of the U.S. labor force,” said Kleiner, professor at the Humphrey School of Public Affairs at the University of Minnesota and the AFL-CIO chair in labor policy. “Licensing is between 25 and 30 percent of the U.S. work force that require permission from the government to work.”

Kleiner’s speech, the first in a series of forums through the department of economics and the department of political science, explored where licensing has reached its bounds and where it has overstepped its bounds. Kleiner said that in the past, health and safety have been an argument for licensing, but studies have shown this isn’t necessarily true.

“Dr. Kleiner is one of the top academics looking at the issue of occupational industry licensing,” Dr. Steve Bradley, faculty director of free enterprise for the John F. Baugh Center for Entrepreneurship, said. “He is a well-known thinker in this area.”

Kleiner said a major issue with U.S. licensing is that not only is licensing a barrier to get into an occupation, but licensing is hard to transfer across state lines. He gave a background on the evolution of occupational licensing and then brought it back to where it is today, also relating it to his work with Uber.

“What we’re looking at is what happens when ride-sharing workers are required to have a taxi license, what happens to the composition of the workforce,” Kleiner said. “It reduces the number of part-time workers because less college students can serve as Uber drivers, less retired people serve as Uber drivers and there are just a lot less people that can perform those services.”

Grandfathering is a concept that plays a role with occupational licensing, Kleiner said. After an occupation becomes licensed, people become grandfathered in, meaning they don’t have to go through the process of getting licensed if they already have the job, and they get a wage bump. Studies have shown that wages of those who are licensed go up significantly more than those of people who have never been licensed.

“Unfortunately, political companies use licenses to keep competitors out and limit choices and competitors,” Bradley said. “Occupational licenses are the hidden things people don’t see that impact business.”

The speech attracted business students and a few professors, as well. Although Kleiner joked about people falling asleep, the audience stayed attentive, interacting with Kleiner and asking questions.

“I’m a master’s student in the economic program, and I’m taking a seminar course in which I have to go to five seminars,” Irvine, Calif., master’s candidate Aaron Liu said. “I couldn’t make the one tomorrow, so I chose this one because it is more industrial-oriented, and I’m considering going into the industrial program, so this will help me find a job.”

Kleiner has received many teaching awards for classes in public affairs, business and economics. Kleiner has previously served as an expert on labor issues for government, labor, nonprofits and business.