California commission recommends major occupational licensing reform

Earlier this month California’s Little Hoover Commission released its report (Jobs for Californians: Strategies to Ease Occupational Licensing Barriers) on occupational licensing in the state. Noting that licensing is often sold as a means to protect consumers while actually serving other interests—namely, economic protectionism for current practitioners—the report makes eight recommendations to California lawmakers to overhaul licensing schemes:

  1. Mandate the collection of demographic information of all license applicants in order to measure the impact of licensing on various demographic groups.
  2. Comprehensively review all California licenses to determine whether the goal of protecting consumers is sufficiently advanced by preventing some from working in occupations.
  3. As a default, require license reciprocity for all professions licensed in other states.
  4. Provide sufficient resources for sunrise and sunset review of newly proposed and existing licenses.
  5. Implement steps to make it easier for former offenders to obtain licenses.
  6. Review legislation to make sure veterans and military spouses are able to easily obtain licenses with their training and experience.
  7. Rather than require license applicants to undergo full retraining, create training programs to help them quickly fill gaps in their training received outside of California.
  8. Create apprenticeships and interim work opportunities to allow people to work while undergoing the licensing process.

While many of these recommendations make a lot of practical sense and would benefit numerous workers, the Legislature should take up the Commission’s second recommendation posthaste. During the study process, numerous witnesses pointed out to the Commission that all too often licensing is pushed by industries themselves—not consumers—as a way to limit competition and collect higher wages. As a result, the focus of reform should not be on making it easier to obtain licenses, but on removing as many licenses as possible.

Those concerned about consumer protections need not fear. There are numerous ways to protect consumers without mandating licensure of professionals. From letting the free market work, to registration, to voluntary certification, professionals possess a multitude of ways to obtain necessary training and credentials. As a result, consumers can trust that they will maintain multiple measures to distinguish between qualified and unqualified professionals. These other measures also avoid the significant costs of lessened employment opportunities and more expensive services associated with licensing.

Hopefully California lawmakers will use the next legislative session to take this report and recommendations seriously and get to work on substantial reforms. Californians can’t afford to wait.