Walking a dog for pay in New York City? You better have a license for that.
Entrepreneurs and teens earning extra pay this summer may find themselves on the wrong side of the law if they lack a license. The city is enforcing unnecessary and antiquated work licensure requirements, to the harm of those who need work opportunities most. These are roadblocks to work that aren't keeping up with how technology is delivering opportunities to earn honest livings and need to be kicked to the curb.
New York City's Health Department has warned a pet-sitting app that if users who list their services don't have a license, they are breaking the law. The Health Department issued a similar warning last year to another website and reportedly at least two residents were given violations. Fines start at $1,000.
Technology platforms in the sharing economy have created new marketplaces for regular people to sell their time, skills, and resources to others who are willing to pay for the convenience and help. Nearly one in four Americans (24 percent) earn money from digital platforms according to Pew Research, with nearly one in 10 Americans performing a task or job such as pet sitting. For about four out of 10 workers, the income is extra money that can be saved for a vacation or to repay debt. However, for a majority of sharing economy workers (56 percent), this income is "essential," meaning that they rely on it for their mortgage or rent.
The sharing economy is uplifting Americans that need opportunity: young people, low-income households, and Black and Latinos workers. Of sharing economy workers who say this income is essential, more than half of them (57 percent) make less than $30,000 per year.
Blacks and Latino communities are particularly impacted by the opportunities of the sharing economy and the challenges of occupational licensure. While the national unemployment rate has fallen dramatically from its double-digit recession highs, the unemployment rates for Blacks and Hispanics still hover above or almost double the national average. Meanwhile, they make up half of workers in the service industry, where many occupations require licensure.
Technology is offering easy entry points to work, but occupational licenses are a stumbling block on the path out of unemployment, out of poverty, and toward upward mobility for Americans.
Occupational licenses are government permission slips that allow people to work in a vocation or occupation. Massage therapists, yoga instructors, truck drivers, security guards, makeup artists, crane operators, cosmetologists, shampooers, and interior designers all require licenses in different states. More than one-quarter of U.S. workers require a license to do their jobs ? a five-fold increase since the 1950s.
Without licenses workers face steep penalties or even risk jail time. To procure a license, the Institute for Justice finds that, on average, an aspiring worker must spend nine months in education or training, pass one exam, and pay more than $200 in fees.
The licenses are purportedly meant to deliver quality services to consumers and ensure health and safety standards are met. Instead they go too far, driving up the costs for consumers, and locking people out of work.
Reforming licensure is a cause that unites conservatives and libertarians with some on the Left. The Obama administration acknowledged the hardship occupational licenses placed on workers and tried to make federal efforts at reform.
New York City has good cause to ensure that animals are treated humanely and safely. Should these regulations extend to a person just walking dogs in Central Park or pet-sitting for their Brooklyn neighbors who are away on vacation? According to the city permit website, that could include providing proof of compensation and disability insurance and proof that they will collect sales taxes or risk getting slapped with a pricey fine. Enforcement and crackdowns could lead to a chilling effect on pet sitting and dog walking.
What started with regulations on ride-hailing platforms is migrating to other sharing economy platforms as they grow in popularity. As lawmakers pursue revenue and control over working activities, they should be careful that they risk hurting those in their communities who need work opportunities most.
Patrice Lee Onwuka is a senior policy analyst at Independent Women's Forum.
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