Universal Recognition on its Way to Becoming All-American?
Times are stressful for American working families. The second and third largest bank failures in American history just occurred, interest rates might be increasing even higher, and inflation remains persistently high. These factors put intense pressure on working families to make careful financial and economic decisions.
For some families, this means moving to a state with more opportunity and a better economic outlook. However, occupational licensing laws can act as barriers in states that do not recognize out-of-state licenses. By requiring workers to redo expensive and time-consuming qualifications to practice the same occupation they already practice elsewhere, these states disincentivize experienced and skilled workers from moving there.
Luckily, more states are taking steps to reduce these barriers. As this map indicates, 2023 began with 19 states having already passed laws to recognize out-of-state occupational licenses to varying degrees, and the year could end with close to half of all states having passed such reforms.
Two weeks ago, Virginia became the 20th “universal recognition state” as Gov. Youngkin signed into law identical and unanimously supported bills, HB 2180 and SB 1213. The bills require Virginia’s Department of Professional and Occupational Regulation to recognize the licenses of workers from other states if the occupation had a similar “scope of practice” and the worker practiced the occupation for three years. Only a few occupations are excluded. Importantly, the bills also allow recognition of work experience as a substitute for licensing if a) the worker came from a state that does not license a certain occupation, b) worked in the occupation for three years, and c) passes any required Virginia licensing exam. There is also no residency requirement.
ALEC’s Commerce, Insurance, and Economic Development Task Force’s Model Interstate-Mobility and Universal-Recognition Occupational Licensing Act similarly has no residency requirements and would allow workers to receive a license for a job with a similar scope of practice without needing to redo qualifications. To be issued a license, a worker would need a) an existing occupational license and 1 year of experience, b) a professional certification and 2 years of experience, or c) 3 years of experience in the occupation.
The model policy—one of ALEC’s Essential Policy Solutions for 2023—likewise allows licensing boards to require workers to “pass a jurisprudential examination specific to relevant state laws that regulate the occupation.” These exams can provide important safeguards for consumers to ensure they are receiving accurate state-specific service and guidance from professionals like architects, who must understand and comply with a state’s unique regulations.
Four additional states are considering similar reforms, led by ALEC and free-market champions like Georgia Senator John Albers, Georgia Representative Chuck Martin, Arkansas Representative Austin McCollum, Florida Senator Jay Collins, Florida Representative Traci Koster, and New Hampshire Governor Chris Sununu.
Of these, Georgia might be the next state to fully pass a major licensing reform bill. HB 155 passed both Georgia legislative chambers unanimously and would require state licensing boards to “issue an expedited license by endorsement to” transitioning service members, service members’ spouses, and workers who are licensed in other states. While licensing through endorsement is slightly different than full recognition and while the Georgia bill does use the less preferable “substantially similar” language to establish equivalency, the legislation would still allow most new Georgia residents with out-of-state licenses to practice their profession in the Peach State.
Arkansas’s universal recognition bill, SB 90, likewise has passed both chambers, though the language needs to be reapproved due to amendments. It also has a residency requirement, but unlike Georgia’s bill, the Arkansas version would establish automatic license recognition. Similar to Virginia’s reform, Arkansas’ bill would recognize the licenses of workers who a) have held a license in good standing for one year in another state or b) have 3 years of work experience in an occupation with a “similar scope of practice” in a state that does not license the occupation.
Florida’s SB 1364 and HB 1333 are slightly more expansive than Arkansas’ bill. In addition to the other two methods of proving work competency, the bills would allow workers with two years of work experience and a private certification to receive a license for an occupation with a similar scope of practice. The Florida bills include a couple provisions that allow stricter competency requirements for key occupations, including for a “general contractor, building contractor, residential contractor, [and] roofing contractor.”
Finally, New Hampshire is not limiting itself to just universal recognition, but it is taking an even more comprehensive look at occupational licensing reform. In his February budget address, Governor Sununu stated that the “budget includes landmark legislation to grant universal license recognition for the professions in New Hampshire that require a license.” It also includes sections that would remove 34 licenses, which would eliminate “14 underutilized regulatory boards and almost 700 unnecessary statutory provisions” in the state.
As Governor Youngkin acknowledged at the bill signing in Richmond, the effort behind good universal recognition reform is about bringing together organized labor, employers, and workers, —and making difficult transitions between states that much easier by removing barriers for those who want to work from Day One. With reforms like Virginia’s that create an easy recognition process for professionals while protecting consumers from unqualified workers, states hang up the “welcome” sign to skilled and experienced workers looking for a new state to call home.