In a recent Notes from the Editor titled "Ode to Licensing," Locksmith Ledger Editor-in-Chief Gale Johnson laments the fact that more states have not passed locksmith licensing legislation. In 20 years, he says, only 15 states have passed such legislation. He states, “This record is nothing to be proud of.” He’s right. In 20 years years and 15 states, none of these licensing schemes can be shown to provide the promised benefits to the locksmith industry or the general public. On the contrary, licensing is a proven failure.
Licensing has usually been promoted within the industry as a way to eliminate “scammers.” It is interesting to note that Johnson’s letter never uses that term – perhaps because scammers continue to operate as freely in the states that have adopted licensing as those that have not. He did say that proponents claimed that “licensing would keep out handymen and part-timers,” while simultaneously claiming that licensing “should not be seen as protection against competition.” I’ll leave the reader to try and resolve that bit of twisted reasoning.
Licensing is, and always has been, a form of protectionism. As stated by the Institute for Justice:
All Americans deserve the opportunity to earn an honest living. Yet occupational licenses, which are essentially permission slips from the government, routinely stand in the way of honest enterprise. Without these licenses, workers can face stiff fines or even risk jail time. The requirements for licensure, though, can be an enormous burden and often force entrepreneurs to waste their valuable time and money to become licensed. Additionally, these burdens too often have no connection at all to public health or safety. Instead, they are imposed simply to protect established businesses from economic competition.
The costs of licensing provide no demonstrable benefits for the consumer and can also lead to unintended negative consequences for both the consumer and members of the licensed industry. Johnson says that the expansion of the big-box stores have hurt the industry during the same twenty-year period. He might want to consider that several studies have shown that increased costs due to governmental restrictions and regulations may be exactly what drives the consumer to the big-box stores, with another unintended consequence of actually reducing consumer security and safety. In an article from the Library of Economics and Liberty, author S. David Young writes:
These higher costs might be acceptable if it could be shown that licensing enhances service quality. Most of the evidence on this issue, however, suggests that licensing has, at best, a neutral effect on quality and may even harm consumers. By making entry more costly, licensing increases the price of services rendered in the occupations and decreases the number of people employed in them. The result is a "Cadillac effect," in which consumers either purchase the services of high-quality practitioners at a high price or purchase no services at all. Some consumers, therefore, resort to do-it-yourself methods, which in some occupations has led to lower overall quality and less safety than if there were no licensing. The incidence of rabies is higher, for example, where there are strict limits on veterinary practice, and as Sidney Carroll and Robert Gaston documented, rates of electrocution are higher in states with the most restrictive licensing laws for electricians. Apparently, consumers often do their own electrical work in highly restrictive states rather than pay artificially high rates for professionals, with predictably tragic results. Carroll and Gaston also found, using data on retail sales of plumbing equipment, that plumbing restrictions increase the extent of do-it-yourself work.
“Think of the value to our industry if every one of those big box key cutters had to be a licensed locksmith,” Johnson writes. I would contend that the value of our industry is enhanced because the big-box store employees lack the competency of a professional locksmith. Would you rather be a locksmith or a Home Depot employee? If they hold the same license as you, why would a consumer choose you? His statement makes as much sense to me as requiring McDonald’s employees to receive culinary school certification. Think that wouldn't drive up the cost of your Quarter Pounder? Think that wouldn't lead you to flip your own burgers at home? This reminds me of another ludicrous result of licensing in Tennessee (which is one of the more recent states to adopt locksmith licensing).
“The most recent target of state protectionism comes from Tennessee, where local licensing boards are threatening two entrepreneurial women for massaging performance horses, without first obtaining a veterinary license legally allowing them to do so.”
The Society of Professional Locksmiths has repeatedly asked licensing proponents to show where licensing has improved the state of the industry in any location that has adopted licensing. Proponents evade the question because licensing has failed to live up to its promised benefits. They also ignore the fact that SOPL Founder Tom Lynch unveiled, years ago, that one of the earlier scammer incarnations - Run Local – had a license in the states that required it. How many states need adopt licensing before its proponents admit that it is an abject failure? I would suggest that fifteen is more than enough and that it is more important for the industry to increase its own professionalism by setting high standards, not minimums.
Licensing is more about others trying to impose "rules" to protect themselves because of their unwillingness to adapt to change, evolve or do what is needed to compete in the marketplace.
Source: Are you a Professional