The Best and Worst States for Occupational Licensure; You May Be Surprised
Occupational licensing is an issue ripe for reform, especially considering the formidable amount of bipartisan support in the reform column.
Many types of jobs require "government permission" before a person can go to work in those industries, and for a large number of them, obtaining a license to practice requires a long period of training, even for lower skilled work like hair braiding. That means delayed productivity and possibly student loan debt.
These excessive training requirements to receive an occupational license are holding back a large number of people from obtaining work.
License-seekers may need to pay hundreds or thousands of dollars in fees, pass multiple exams, and/or gain months to years of experience before receiving a license. The Institute for Justice (IJ), a nonprofit law firm, has exhaustively catalogued licensing requirements for over a hundred low- and middle-income occupations across the fifty states plus the District of Columbia.
One particularly common requirement for occupational licenses is education. These requirements range from daylong courses to certificates or degrees that may take many years to attain. Longer education requirements are particularly burdensome because they carry multiple costs: aspiring workers must not only find a way to finance their education, but may also forego the opportunity to earn income while they are in school. Taking on student debt becomes necessary for many license-seekers.
Nearly one-third of all workers require some form of licensing to get a job. The requirements vary by state, with some states having only a few jobs with license requirements, and others with many.
Based on data from the Institute for Justice, this chart below shows the number of jobs that have licensing requirements in each state, and how long the education period is for those jobs.
Education researcher Preston Cooper says this is a drain on productivity.
The disparities in educational requirements across states suggest that many of these requirements do not justify their costs. Less than half a year of education is required to become a licensed massage therapist in most states, but Maryland requires over a year of training for this occupation. Fire alarm installers need no education in most states, but need two years in Tennessee.
These requirements put employment out of reach for many Americans, especially those who cannot afford the fees and school costs. In response, Cooper advocates trimming the cost and education requirements for these positions. Especially in states like Virginia, reform is needed if opportunities to work are going to be opened up for more citizens.
Were you surprised by your state's licensing requirements?