Introduction

Until recently, Connecticut held a unique, although little-known, distinction among the 50 states: For nearly 40 years, it allowed manicurists—also known as nail technicians—to work without an occupational license. 

For many years, Connecticut did require manicurists to obtain a government permission slip to work. ¹ However, the state repealed its manicurist license in 1980 after a government review concluded the license was unnecessary. ² Then things changed again in 2019 when the legislature voted to relicense the occupation. ³

Advocates argued nail tech licensing was necessary to protect workers and consumers and ensure safe, quality service. ⁴ Opponents, meanwhile, argued the costs of licensing would outweigh any benefits. ⁵

One opponent of relicensing was Tara Swagger, who owns a salon in Putnam and has two decades of industry experience. ⁶ In public testimony, Swagger argued the cost of licensing would add a significant burden to her and other salon owners’ operations. ⁷

Swagger, who estimates she has served more than a thousand clients over her career, also pointed out that licensing is no guarantee of customer safety or satisfaction: “Licensed trades have plenty of lousy technicians and improper work resulting in bad experiences. Many people have stories for just about any industry and beauty is no exception.” ⁸ She said that in her experience, bad experiences at nail salons are an issue “not . . . of untrained or unlicensed technicians but [of] simple mistakes or unforeseen reactions or allergies that are part of the risk in this business.” ⁹

Swagger also noted that the state already had mechanisms in place to protect customers. “The health department is already in charge of regulating these businesses for the purpose of public health.” ¹⁰ She pointed out that the state’s salon inspection format already checked for proper sanitation. ¹¹

The debate over nail tech licensing in Connecticut is, in many ways, representative of the ongoing national debate over occupational licensing, which now affects about 1 in 4 American workers compared to 1 in 20 in the 1950s. ¹²

On one side of the debate are those who argue licensing protects the public and keeps service quality high. It does this, the argument goes, by shutting out service providers who have not met certain minimum standards and who are therefore likely to provide low-quality service. ¹³ On the other side are those who argue licensing comes at too high a cost—to workers, to consumers, and to society and the economy at large. ¹⁴ Critics say that licensing burdens often appear arbitrary and that other, less onerous, regulations—and often just ordinary market competition—can protect the public and keep quality high without licensing’s costs. ¹⁵

But which side is right? Does licensing, in fact, promote safe, quality service?

We are not, of course, the first to ask this question, but our research is unique in that we examine occupations that others have not. Specifically, we explore differences in service quality—as measured by average consumer Yelp ratings of businesses—for six occupations. For four of the occupations—interior designer, locksmith, manicurist and tree trimmer—we compare quality in an unlicensed state with that in a bordering licensed one. For example, we compare manicurists in Connecticut before they were licensed with those in neighboring states that have long required licenses. For the other two occupations—barber and cosmetologist—we compare quality in a licensed state with that in a bordering one with stricter licensing requirements. If licensing produces better, safer service in these occupations, we would expect to see higher Yelp ratings in licensed states or in states with more stringent licensing requirements.

Our results cast doubt on the notion that licensing increases quality. Licensing is not associated with greater service quality in any of the occupations or states we studied. In all but two of our comparisons, state licensing—and progressively stricter forms of it—fails to produce statistically significant differences in quality. And in the two comparisons where we do see a significant difference, the state with lighter licensing burdens has higher consumer ratings than the neighboring states with steeper burdens. These results suggest policymakers and the public should be skeptical of the argument that licensing is necessary to ensure service quality.