Everyone loves the party game/icebreaker “two truths and a lie.” 

As some states have begun to address occupational licensing reform, test your knowledge on occupational licenses. Can you identify which of the following is NOT true about occupational licensing? 

  1. Occupational licenses make it difficult for many people to start a new career.

  2. Occupational licensing requirements are uniquely tailored to the responsibilities of each specific licensed profession.

  3. Occupational licenses are often not necessary to protect the health and safety of Americans.

 

A. TRUE

Many people who are looking to begin careers in licensed occupations face great barriers because of the expensive, time-consuming, and unnecessary training that many states require.  There are dozens of examples across the country where individuals, seeking to improve their lives and financial stability, are punished and shut down by state boards for their hard work and innovation. 

Additionally, many occupational licenses restrict those with criminal backgrounds from obtaining a license. Because a large proportion of these occupations use skill sets that are taught in prison rehabilitation programs, having a set rejection of anyone with a criminal record, regardless of any other details or qualifications, greatly reduces career opportunities for former prisoners and without a job, their chances of a successful new start in life are severely diminished.

 

B. FALSE

Occupational licensing requirements vary widely between states.  While one state may require 200+ hours of training to obtain a license, another state may not even require a license for that occupation. This makes it difficult to move between states and limits entrepreneurial opportunities. 

Instead of being tailored to each profession, occupational licensing requirements often reflect the efforts of those who already hold an occupational license in that state to limit the competition. By restricting the free market through arbitrary licensing requirements, competition is reduced and innovation is stifled. Reducing the number of arbitrary occupational licenses would both provide new opportunities for many individuals while driving down prices and improving service for the American public as a result of the free market competition. 

 

C. TRUE

While some licensing is important for some occupations, such as those in the medical professions, most occupations do not require licensing to protect either the public or even the professionals themselves. Occupational licenses are required for a broad variety of occupations, many of which clearly pose no risk to health or safety. These range from florists to shoeshing, music therapists, and more. 

Some states have made progress in occupational licensing reform, primarily through enabling universal license recognition.  This allows states to recognize the occupational licenses that individuals hold in other states, without requiring them to undergo further and unnecessary training and education. But the large majority of states continue to create barriers for economic improvement and entrepreneurial innovation. Broad occupational licensing reform is needed to remove arbitrary licensing requirements and allow universal recognition of licenses between states.