Gov. Herbert recently celebrated the Utah Legislature’s modest reforms of occupational licensing laws, highlighting an update from the Institute for Justice showing that the state decreased some of the barriers imposed on workers. As organizations that have engaged in removing such barriers for years, it’s great to have a prominent voice on board with the positive changes we’ve long been working toward.
As with most rankings, though, being less bad than everyone else doesn’t mean there isn’t still significant work to be done. The reality of Utah’s place in the rankings of most burdensome licensing laws is that, when you account for the actual number of professions for which our state requires a license, and the average burden of classroom hours and fees associated with acquiring one of those licenses, Utah is still the 24th most burdensome state in the country.
We believe that a state that holds itself out as being free-market friendly and good for business can — and should — do much better.
Utah’s recent improvement in the rankings has more to do with the study’s weighted preference for the construction industry, for which the Utah Legislature reduced licensing requirements in 2017. Most professions remain unchanged, however, and industry lobbyists inevitably seek more license requirements every year.
Though Utah may be slightly less burdensome than it used to be, the reality is that over 200,000 Utahns are still required to obtain a permission slip to engage in their desired profession. The costs associated with these laws are far reaching. The Institute for Justice’s analysis concludes that Utah’s licensing laws result in 20,000 fewer jobs in our state than would otherwise exist — jobs that could provide vital income and career opportunities for low income families and ex-offenders.
Additionally, with fewer people engaged in a profession due to burdensome barriers to entry, those already working in those jobs are able to charge more due to decreased competition. These costs ripple throughout the state’s economy, costing Utahns an estimated $88 million per year.
The often forgotten aspect of burdensome licensing requirements is that the costs are not merely economic. We can’t forget priority criminal justice issues that the Utah legislature addresses year after year, such as high recidivism rates and breaking the chain of intergenerational poverty, are intertwined with access to employment.
A study by Stephen Slivinski of Arizona State University takes a healthy dive into the relationship between recidivism rates and burdensome occupational licensing laws, and concludes that access to lasting employment is essential to ensuring former inmates don’t return to prison. In fact, states with high burdens and barriers to entry due to licensing laws saw an increase of 9 percent in their recidivism rates over a 10-year span. On the other hand, states with low occupational licensing burdens saw a decrease of 2.5 percent in their recidivism rates over the same 10 year period.
Unfortunately, not only do our licensing requirements present a high burden for those with criminal histories to overcome, but the laws also preclude many people simply because of their criminal past, regardless of whether or not their underlying crime had anything to do with the profession for which they need a permission slip.
While we should celebrate the incremental reforms that Utah lawmakers have implemented, they can do much more. We hope that the governor’s support will extend to ensuring that the licensing agency he oversees also supports more reforms to position Utah as a leader among states on this issue — and not merely in the middle of the pack.
We propose several ideas to accomplish this goal:
- Fund an ongoing review of all current government licensing requirements, upholding licenses only where significant public health, safety, and financial well-being concerns are identified and are not effectively handled by alternatives to government licensure.
- Improve access for consumers and provide momentum for reducing Utah’s internal licensing barriers by recognizing licenses issued in other states for those who relocate to Utah, rather than making them jump through more hoops to prove knowledge and experience they have already satisfactorily demonstrated.
- Prevent a person’s criminal history from being taken into consideration for licensure after five years, and require that when a criminal history is taken into consideration for licensure that the crime must be tied directly to the core functions of the profession.
- Reduce and/or repeal continuing education requirements that typically lead professionals to jump over irrelevant hurdles to maintain their license in good standing.
A combination of these reforms will help propel Utah to the top of the national rankings, making the Beehive State an attractive home for professionals who want to build a better life. Modest reforms in recent years have been good steps, but it’s time to lengthen our stride and support hard-working Utahns who shouldn’t have to jump through unnecessary hoops to earn a living for their family.