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Report: Alabama’s occupational licensing requirements cost the state jobs, hurt economy

A newly published report found that Alabama’s occupational licensing laws — requirements that members of certain professions be certified by the government — cost the state almost 21,000 jobs and an estimated $56 million per year.

The report, titled “Not-So Sweet Home Alabama,” was written by a pair of economists and is a joint project of the Archbridge Institute and the Alabama Policy Institute (API). Both Archbridge and API are non-partisan entities that generally favor free markets and less government regulation.

“In the COVID-19 economy, Alabamans simply do not need onerous government mandates interfering with upward mobility and threatening the American Dream,” said Gonzalo Schwarz, president and CEO of Archbridge, in summary of the report.

According to the report, Alabama added licensing requirements for 36 professions between 1993 and 2012. The state now has 36 professions that require a government license, which is above the national average of 31.

The writers of the report point to athletic trainers, manicurists and massage therapists as examples of low-income professions where the cost of getting a license is especially burdensome.

The report was composed by Edward Timmons and Conor Norris. Timmons has a Ph.D. in Economics and is a professor at Saint Francis University. Norris has an MA in economics and currently serves as a research analyst at Saint Francis.

Timmons and Norris cite a study from the libertarian-leaning group Institute for Justice as evidence of their claim that occupational licenses cost Alabama’s economy $56 million per year and 21,000 jobs.

Defenders of occupational licensing laws say that they provide consumer safety and protect the public from scams.

State decision-makers are urged in the Archbridge report to consider laws that would put all licensing requirements under recurring review to determine their necessity every few years.

It also encourages “universal recognition” legislation that would give licensed professionals from other states the ability to practice in Alabama without any additional barriers.

“Professionals and consumers both benefit from this legislation. It gives professionals the flexibility to relocate to a new state, encouraging interstate mobility. Workers can move to Alabama and begin practicing immediately, rather than wasting time and money retraining, reeducating, and retesting,” argue the authors.

States such as Mississippi, Iowa, Missouri and Arizona have enacted meaningful occupational licensing reform and reaped benefits from doing so, per the report.

“What Alabamians need is for the state government to make it easier to work and secure economic prosperity, as they climb out of the pandemic-induced recession,” concluded Schwarz. “Reforming occupational licensing rules would empower working Alabamans to make the best financial decisions for themselves, taking the state economy to new heights.”

Henry Thornton is a staff writer for Yellowhammer News. You can contact him by email: henry@new-yhn.local or on Twitter @HenryThornton95.