Yesterday, Senate Bill 348 passed the Kansas House by a 110-10 margin. The bill, which, changed slightly from when it passed the Senate to the version just passed in the House and has yet to be enacted, exempts hair threaders from cosmetology licensing conditions, including 1,000 hours of training that can run to over $15,000. These regulations make it harder for people to become licensed and for threading businesses to find employees. Kansas Justice Institute is also currently representing Jigisha Modi and her threading business against burdensome regulations.
This bill is a bipartisan regulatory reform and is an example of a way to create more economic opportunity for people by enshrining their right to work. What widespread regulatory reform in the Sunflower State would look like is detailed in KPI’s Streamlining State Regulations report released earlier this year.
Kansas’ regulatory book would take the average person 180 consecutive hours of reading to gloss over. Stack up a million other federal regulations and varying amounts of local regulations and citizens have a wall of limitations of what they can and can’t do. The basic fact is that reducing regulations reduces costs on businesses and the consumers ultimately paying the final bill. The average small business start-up sees first-year regulatory costs of $83,019. Reducing that number by even a little could give the business the opportunity to hire more employees or pay employees more, purchase more products, upgrade equipment, or keep prices low.
The widespread economic cost of regulations shouldn’t be ignored either. An estimated 29,409 jobs have been lost from Kansas due to occupational licensing restrictions – but one type of regulatory burden addressed via SB 348. In total, this means a $197.5 million loss from the state’s economy annually. Occupations with state-specific licensing exam procedures had 36% less migration when compared to other states.
Many of the economic consequences of regulations fall on people of color, people with disabilities, and other historically marginalized groups. Complexity can be described as a subsidy and too often can often be abused by existing firms to act as barriers to entry for new competition, especially from historically marginalized groups and start-ups. For instance, licensing reduces the probability of a Black individual working as a barber by 17.3%. Everyone, no matter their background, deserves the right to work how they choose.
Regulatory reform lowers costs and creates a more cohesive economy. In my personal experience starting a business in college, navigating opaque rules and administrative bodies could deter potential entrepreneurs (which is why I put together a brief guide of entrepreneurship resources for Kansas). According to a study of Wichita businesses by KPI and Wichita State University’s Hugo Wall School of Business, companies appreciated an end-goal-focused approach to regulations but often got frustrated when regulations felt arbitrary.
Ideas for regulatory reform are endless: occupational licensing reform, zoning reform, regulatory sandboxes, Right to Earn a Living legislation, bipartisan regulatory review committees, more opportunities for oversight, etc. SB 348 is but the first of many changes that need to happen and should attract bipartisan support.
