It puts some students at a severe disadvantage for hiring because they get screened out because they chose a field that publishes 50 page papers instead of 2 page papers.
So if person from neuro discipline A and neuro discipline B are applying for the same job in data science, discipline A could get screened out because they spent years training a monkey to do a brain machine interface task while person B published five fMRI papers in three years. Neither candidate is going to use their specific neuro expertise, but rather their general data science skill set. One will be at a huge disadvantage unless she is hired directly by people who know her field.
You could find UNC Chapel Hill's School of Public Health, one of the best in the country. They require a paper to be submitted.
This is not a national requirement however. I bet you could find a PhD granting institution in the US that doesn't require publication.
Moreover, there's spillover effects from requiring this; I'm told in China that medical journals are facing a dire problem of research fraud, due to research publications being tied to promotions in the medical community (https://www.thelancet.com/journals/lancet/article/PIIS0140-6...). It seems reasonable to assume incentivizing publications will reduce the quality of publications, whether the incentive is a promotion or a degree.
The question I have though, is what harm there is in reverting to a socially enforced standard. It's pretty easy to screen out PhD applicants without a publication, and I don't know of anyone who's too busy churning through PhDs to give their scholarly output at least a brief glance. If the screening device is available cheaply, who is harmed by this legislation?