According to a new state-by-state study by the Institute for Justice Alabama ranks among the most burdensome states in the country when it comes to occupational licensing.
In the new report, License to Work: A National Study of Burdens from Occupational Licensing, Alabama ranked as the 47th most burdensome state. The state licenses more lower-income occupations than average—63 of the 102 occupations included in the study require licensing. In fact, the state requires workers in over 140 fields to have licenses to practice. From doctors and beauticians to bartenders and locksmiths.
What’s an occupational license?
Simply put, an “occupational license” is express industry board/government permission to work in a chosen field. To earn the necessary license, an aspiring worker may have to anything from simply registering with the state board, all the way to examinations, or even hundreds of hours of classroom or practical experience.
Nominally, the licenses exist to protect consumers from any harm that could be caused by an unqualified worker.
“Licensing laws force people to spend a lot of time and money earning a license instead of earning a living,” said Dick Carpenter, an Institute for Justice director of strategic research and co-author of the report. “They create roadblocks for workers hoping to break into new occupations, change careers or build new businesses.”
According to the report, these roadblocks are rife with inconsistencies and irrationalities that often undermine the case for licensing. For example, most of the 102 occupations are unlicensed somewhere, suggesting they can be safely practiced without a state license. And licensing barriers often make little sense: In most states, it takes 12 times longer to get a license to cut hair as a cosmetologist than to get a license to administer life-saving care as an emergency medical technician.
“Research provides scant evidence that licensing does what it is supposed to do—raise the quality of services and protect consumers,” said Lisa Knepper, an Institute for Justice director of strategic research and co-author of the report. “Instead, it limits competition, leading to higher prices and reduced access to jobs.”
How Alabama compares to the rest of the country
Many of the required license requirements in Alabama don’t add up. For example, the state imposes burdens on some occupations that seem excessive compared to those for other occupations that may present greater risks to the public.
Take an auctioneer in Alabama. The profession requires $500 in licensing fees and 385 days of education and experience (comprising an 85-hour course and a one-year apprenticeship). Meanwhile, an EMT needs only pay $90 and complete approximately 42 days (180 hours) of education to become licensed.
According to the report:
- Alabama licenses 63 of the 102 lower-income occupations studied.
- On average, breaking into these occupations takes $329 in fees, 142 days of education and experience, and about one exam, making Alabama’s licensing laws the 47th most burdensome out of all 50 states and the District of Columbia.
- Considering both the number of licensed occupations and the difficulty of their requirements, Alabama ranks as the 25th most widely and onerously licensed state.
What Alabama could do to improve its ranking
“To expand opportunity for workers in the state, Alabama should reduce or repeal irrational licensing burdens, or—if government regulation is necessary—replace them with less restrictive regulatory alternatives,” said the Institute for Justice in the report released Tuesday.