A recent article on Forbes.com notes a dramatic rise in the demand for occupational license requirements. Doctors and lawyers have always been subject to governmental licensure, but Forbes points out that mortgage brokers, interior designers, funeral directors, building contractors, hairdressers, and others are now asking governments to impose or stiffen occupational entry requirements. Forbes refers to this as a new “union” movement:

As the economy has switched from manufacturing to services, some 28% of U.S. workers--or 43 million people--now belong to a licensed profession, according to a Princeton University/Gallup survey last year. That's up from 4.5% 50 years ago. Over the same period union membership has fallen from 35% to 12%.

Forbes argues that “[t]hese modern-day guilds have replaced organized labor as the main vehicle for workers seeking to shield themselves from competition.” This may or may not be a fair attack on unions, whose primary function is to bargain with an employer over terms and conditions of employment. But restricting labor competition is clearly bad policy – and not just for businesses:

But tough rules protect consumers, don't they? Not necessarily. A 1981 study in the Southern Economic Journal found that in states that make it toughest to become an electrician--keeping the numbers low and the fees high--accidental electrocutions happened more often because customers are tempted to do the work themselves. Strict rules in some states on the types of work that can be done only by doctors--protecting them from competition from nurse practitioners, for instance--help slow the spread of chains of low-cost medical clinics. . . .

Licensing laws hit the poor particularly hard. They're often shut out of jobs that would hoist them onto the first rungs of the economic ladder--shampoo assistant, pipe layer's helper, home health aide--because they lack the time and money to take the classes and serve the apprenticeships to pass the exam. All consumers miss out on the creativity and added quality that entrepreneurs and other innovators would bring to many lines of work, says Mellor.