The Impact of State Licensing Regulations on Low-Skilled Immigrants: The Case of Vietnamese Manicurists

The number of people living in the United States who cannot speak English, or cannot speak it well, more than doubled from 1980 to 2000. This is a visible—actually, audible—effect of the recent surge in immigration, which increased the fraction of foreign born from 6 percent in 1980 to 11 percent in 2000. Less noticeable is that recent immigrants are less skilled than earlier waves of immigrants, with fewer high-school graduates relative to natives of the same age. Low-skilled immigrants are often drawn to jobs in the service sector and sometimes choose to migrate to areas with shortages of low-skilled labor. The dispersion of immigrants across occupations and geography may be impeded, however, by state licensing regulations, which specify the minimum qualifications for a range of low-skilled occupations, such as manicurists, beauticians, nurse’s aides, and taxicab drivers. We estimate the effects of state regulations on the entry of Vietnamese into manicuring and their dispersion across the country. Vietnamese entered manicuring in large numbers in the 1990s beginning in areas with large enclaves, such as California, and spreading throughout much of the country. By 2000, 41 percent of manicurists were Vietnamese and 5 percent of all Vietnamese workers were manicurists, compared to only 0.04 percent of non-Vietnamese workers. Vietnamese immigrants share many of the characteristics that set immigrants apart from natives: 30 percent report speaking English poorly or not at all and 38 percent of adult Vietnamese immigrants have not graduated from high school. Also, almost all adult Vietnamese (94 percent) are immigrants. While all states require manicurists to be licensed, the requirements vary widely, especially from the vantage point of low-skilled Vietnamese immigrants. Thirty-five states do not require manicurists to know much (if any) English: Florida has no exam; California, Texas, and Washington offer exams in Vietnamese; 15 states allow the use of interpreters or dictionaries; and in 16 states applicants can bypass the English-only exam by transferring their licenses from another state. In contrast, 16 states require some level of English proficiency, either indirectly by requiring manicurists transferring a license to pass a separate exam on state laws, or directly by requiring applicants to pass an English test or restricting reciprocity to only those who took licensing exams given in English. The required amount of training also varies considerably, ranging from 100 to 600 hours at state-approved cosmetology schools. Finally, many states require manicurists to be either high-school graduates or to have completed a minimum of seven to ten years of schooling. Previous studies have estimated the impact of licensing laws on high-skilled immigrants (Adriana D. Kugler and Robert M. Sauer, 2005), minorities (Stuart Dorsey, 1980), barbers (Robert J. Thornton and Andrew R. Weintraub, 1979), and workers with different amounts of education (M. Morris Kleiner, 2000). Also, Madeline Zavodny (2000) examines whether declaring English to be the official state language affects the earnings of limited-English proficient workers. This is the first study, * Federman: Department of Economics, Pitzer College, 1050 North Mills Avenue, Claremont, CA 91711 (e-mail: Maya_Federman@pitzer.edu); Harrington: Department of Economics, Kenyon College, Gambier, OH 43022 (e-mail: Harrington@kenyon.edu); Krynski: Department of Economics, Kenyon College, Gambier, OH 43022 (e-mail: Krynski@kenyon.edu). We thank Todd D. Kendall, Gerald Oettinger, Robert F. Tamura, and seminar participants at Claremont McKenna College, Clemson University, and the W.E. Upjohn Institute for Employment Research for helpful comments. We appreciate the financial support provided by Pitzer College and the J. and Paul G. Himmelright Chair in Economics at Kenyon College. 1 Directly: District of Columbia, Illinois, Mississippi, Nebraska, South Carolina, Tennessee, Utah, and West Virginia. Indirectly: Idaho, Iowa, Kansas, Minnesota, Missouri, North Dakota, Ohio, and Vermont.