Another contributing factor is that, in an accounting sense, licensing and licensing boards are generally expected to (and usually do) pay for themselves. Some may even create small yearly surpluses in their operations. Especially in times of fiscal stress on state budgets, legislatures may be understandably reluctant to eliminate a revenue-producing agency. As noted earlier, over the past several decades, sunset laws have been passed in several states—about 36 since the 1970s. These laws require the periodic review of certain programs and agencies (such as occupational licensing and licensing boards). The periodic reviews are commonly called performance audits or legislative audits, and they result in a recommendation to either continue or discontinue the licensing of the occupation under review.76 How effective have these laws been? About half the states that had passed sunset laws later repealed or suspended them, while many others have limited the frequency of the audits. Moreover, in theory, a legislature’s decision to terminate or continue licensing is based on the sunset review panel’s recommendation. But in fact, these reviews rarely recommend de-licensing. Rather, from our study of performance audits across the states, they U.S. BUREAU OF LABOR STATISTICS 14 MONTHLY LABOR REVIEW usually recommend that the licensing of the occupation be continued. In those rare instances when a performance audit does recommend de-licensing, we have found that the legislature usually ignores the recommendation and votes to continue to license the occupation. Hawaii is an example. On at least three occasions since the 1980s, the Hawaii Legislative Auditor Office has recommended the complete deregulation of the barbering and beauty worker occupations. However, the Hawaii legislature voted each time to continue licensing the two occupations. Other occupations in Hawaii that have been recommended for de-licensing include mechanics, bail bond agents, dispensing opticians, and sanitarians (also known as public health inspectors), but again, in each case, the audit committee’s recommendations were not implemented.77 The experiences in other states have been similar to that of Hawaii. For example, DORA of Colorado released a sunset report in 1999 recommending the complete deregulation of manicurists and cosmeticians (aestheticians), but the legislature did not act on the recommendation.78 And in 2004, DORA suggested sunsetting the regulation of respiratory therapists, but the legislature did not act on the recommendation. Maryland is another state with a history of sunset reviews that recommended de-licensing only to have the legislature not act on the recommendations. The occupations in question were foresters (with reviews recommending terminating forester licensing made in 1982, 1992, and 2012), interior designers (2003), and environmental sanitarians (2011).79 These examples of failed sunset reviews are further evidence of the lobbying power and legislative influence that many licensed groups possess through their licensing boards or their professional associations. Sunset reviews are also time-consuming and costly. As a result, many of these laws and the sunset review committees that were created have been subsequently limited, suspended, or repealed. A major reason is that the process demands much time of legislators and review committees. Economist William White has recognized that licensing can bring with it “ratchet” effects that may make it more difficult to eliminate than to introduce in the first place.80Ratchet effects can occur because of grandfather clauses, which exempt existing practitioners from newly legislated licensing requirements. The result is that wages may not rise immediately with the onset of licensing requirements, since the supply of workers will not fall until those who are grandfathered leave the occupation. The reverse is not true, however. Should de-licensing occur, wages may be expected to fall immediately with the inflow of new workers with lower qualifications into the occupation. The net result is that the immediate losses to practitioners from de-licensing are likely to be greater than the gains from licensing. Hence, the resistance to de-licensing is likely to be greater as well. Finally, as we have seen, a number of recent attempts have occurred at the state level—nine as of 2014—to delicense collectively certain groups of occupations. Although these attempts were unsuccessful, the occupational groups proposed for deregulation share some common characteristics. They usually number about one or two dozen, they generally are occupations that require relatively low levels of education, and their deregulation is not likely to sacrifice public health or safety. In most cases, hair workers (barbers, cosmetologists, and hair braiders) are among the occupations proposed for de-licensing. One reason often given is that excessive government regulation, such as occupational licensing, hinders job creation and growth, especially for those with lower levels of education and incomes. Nevertheless, these de-licensing bills have generally been met with stiff opposition and have consequently been withdrawn, defeated, or sent back to committee. Conclusion U.S. BUREAU OF LABOR STATISTICS 15 MONTHLY