Last Friday, President Joe Biden signed a new Executive Order aimed at addressing competition in the American economy. At its core, the order shares a fundamental goal with America’s New Business Plan: bringing balance to a playing field currently skewed toward big corporations.
The status quo hurts nearly all involved. Wages stagnate in an uncompetitive market, while barriers to entry stifle innovation. The domino impact on the economy at large, particularly when entrepreneurship is hampered, is well documented. Curbing big business influence and primacy isn’t simply good policy for “the little guy,” — it’s essential policy for the good of the American economy.
The Executive Order includes two recommendations directly from ANBP — reforming noncompete agreements and reining in occupational licensing. Both of these recommendations have seen recent bipartisan momentum at the state level, and now have the strength of the federal government behind them, too.
In remarks, President Biden discussed the reality many Americans face regarding occupational licenses.
“It can’t be a significant burden to get a new license in a new home state,” he said. “It takes time, and it takes money. It takes a toll on families’ income while you’re waiting. We should remove that barrier, providing more mobility, more opportunity, higher wages for families on the move.”
He specifically cites the undue burden on cosmetologists — something we’ve covered in the context of the Institute for Justice’s recent efforts around hair stylists licensing in Arkansas. That instance is reflective of what many face nationwide, across industries: unnecessary licenses for “simple and harmless services.”
So too does noncompete reform represent a more common-sense approach to regulation. As President Biden noted, “a recent study found one in five workers without a college education is subject to non-compete agreements. They’re construction workers, hotel workers — disproportionately women and women of color.”
For years, these overly restrictive barriers have existed because big, powerful, and established businesses have won the war of influence, using teams of consultants, attorneys, and lobbyists against which entrepreneurs can’t compete.
But the Executive Order — just the latest in a line of similar policy actions — signals a new age of competition may be on the horizon.
As members of the Start Us Up coalition — like the Institute for Local Self-Reliance, Economic Innovation Group, and Access to Markets — continue to lead, we’re confident more and more policymakers will listen and engage.
- America’s New Business Plan: Rein in Occupational Licensing
- Institute for Justice: Recommendations for Reform