Summary of Occupational Licensing and the American Worker

Brookings Institution,

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Occupational Licensing and the American Worker summary
Licensing requirements have both benefits and drawbacks for American workers and the economy.


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The US Bureau of Labor Statistics reports that almost 25% of employed Americans in 2015 required licenses to work in their chosen occupations, up from 5% in the 1950s. In this fresh look at the US labor market, economist Ryan Nunn reports on the scope and impacts of licensing, a requirement with both negative and positive implications for individuals and the overall economy. getAbstract suggests this instructive article to employers, employees, and those looking to understand how licensing shapes the US workplace and the economy.

In this summary, you will learn

  • Why licensing is necessary for some occupations,
  • How licensing shapes the labor market and
  • What licensing alternatives can make labor markets more efficient.


In the United States, workers need to hold a license to engage in many types of employment. Occupational licenses – which governments, usually at the state level, issue – confer “legal permission” to work in a particular field. Requirements for job licensing are rising in industries as disparate as ...
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About the Author

Ryan Nunn is a policy director with the Hamilton Project at the Brookings Institution.

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