Occupational Licensing

chapter from the publication Guide to the Issues 2022

Overview

An “occupational license” is, put simply, government permission to work in a particular field. To earn the license, an aspiring worker must clear various hurdles, such as earning a certain amount of education or training or passing an exam.

Occupational licensing laws can pose substantial barriers for those seeking work, particularly those aspiring to these professions. Moreover, since many currently licensed occupations offer the possibility of entrepreneurship, these laws hinder both job attainment and creation.

In the 1950s, about one in 20 U.S. workers needed the government’s permission to pursue their chosen occupation. Today, that figure stands at about one in four. Research to date – on occupations as diverse as school teachers, interior designers, mortgage brokers, dentists, physicians and others – provides little evidence that government licenses protect public health and safety or improve the quality of products or services.

Citizens have a right to pursue a legal occupation, and the burden should fall on the government to justify any restrictions to that right.  Restrictions on economic liberty should be targeted at protecting health and safety, and policymakers should demand proof that there is a clear, likely and well-established danger to the public. The government should use the least restrictive means to address any danger to the public.

Recommendations

Create protections for economic opportunity

Protect economic opportunity by creating a statutory right to an occupation; requiring proof of a clear, likely and well-established danger to the public, and ensuring that less restrictive means have been tried before resorting to professional licensing.

Reduce, convert and repeal

Examine existing occupational license requirements for opportunities to reduce qualifications for licensure such as the hours of training and “continuing education” required to obtain and retain certain licenses; convert license requirements to a less restrictive form of regulations such as inspections, bonding or voluntary certification; or repeal regulatory requirements.

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