ARLINGTON, Va.—A new report reveals for the first time the shocking amount of debt Utah beauty school students take on only to end up in jobs that rarely pay off in terms of earnings. The examination of federal data on cosmetology schools nationwide shows that state-mandated education often fails aspiring beauty workers. Specifically, the new Institute for Justice (IJ) study finds:

• Utah cosmetology students, who are typically lower-income, on average borrow more than $5,400 in federal student loans to complete the education required for cosmetology licensure. The average cosmetology program costs more than $14,400 and takes about a year.
• On average, just over half of students graduate on time. No school in the state graduated all of its students on time during the period studied.
• Those who graduate and get licensed can expect to earn just $26,570 per year on average, less than restaurant cooks or concierges, neither of whom must invest—by law—in costly education to work. With those wages, many may find it difficult to repay their student debt.

Tellingly, “Beauty School Debt and Drop-Outs: How Utah Cosmetology Licensing Fails Aspiring Beauty Workers” shows that most cosmetology programs exactly match state licensing mandates. When Utah reduced cosmetology licensing hours in 2013, over 90% of schools in the state shortened their programs to match. The study demonstrates that state cosmetology licensing doesn’t help students or the public—only cosmetology schools.

“Cosmetology students take on student debt hoping that their education will lead to greater economic opportunity, but our report reveals that beauty school is often a raw deal,” said IJ Senior Research Analyst Michael Bednarczuk, Ph.D., one of the study’s co-authors. “Utah’s licensing requirements funnel students into private, for-profit schools that receive millions of dollars in federal grants and student loans. Yet these schools often fail students and leave them with debt they cannot afford to repay. There are better ways than licensing to protect the public and state lawmakers should consider alternatives.”

Forcing aspiring beauty workers into costly and lengthy schooling might make sense if it were essential for public safety, but there are good reasons to think it is not. According to a recent legal analysis, nationwide, only about 25% of the material states require cosmetology schools to teach directly addresses health and safety. In fact, cosmetologists face steeper licensing requirements than workers in fields more directly linked to health and safety. For example, in Utah, cosmetologists must complete 13 times as much training as entry-level emergency medical technicians.

Lawmakers should refocus regulation on what is important: ensuring safe, sanitary practices at salons through inspections. For instance, restaurant workers are not required to complete burdensome state-mandated education to do their jobs. Instead, frequent inspections ensure that restaurants are clean and that workers are properly informed about health and safety hazards.

Despite increasing political polarization, decreasing occupational licensing burdens has been a bipartisan effort in recent years. Both the Obama and Trump administrations encouraged states to reduce licensing barriers. Just recently, President Biden called on the Federal Trade Commission to promote competition in the American economy, noting that “some overly restrictive occupational licensing requirements can impede workers’ ability to find jobs and to move between States.”

According to a 2020 nationwide poll conducted by Public Opinion Strategies, a majority of Americans—Republicans, Democrats and Independents—support efforts to reform occupational licensing. In addition, respondents ranked government-issued licenses as the least important factor in choosing a service provider. And when asked which criteria make a person qualified in an occupation, respondents put having a license last.

The Institute for Justice’s strategic research program produces social science and policy research to inform public policy debates on issues central to IJ’s mission. Past IJ strategic research reports on occupational licensing include a nationwide study of the burdens of licensing and a study on the costs of licensing in the states and nationwide. Another recent IJ report studied licensing barriers for ex-offenders.