Free Market

How Occupational Licensing Might Boost Utah’s GDP and Employment Outcomes

In 2019, Arizona became the first state to require that state licensing agencies recognize an equivalent license issued by another state and issue a reciprocal license to practice in Arizona. Since this law went into effect, over 5,000 individuals have utilized this legislation and applied for licensure. This is positive as this law has the intended effect of undoing licensing regulations that keep people out of the workforce.

Further positive effects of this legislation are also being highlighted by a Common Sense Institute Arizona study. This study found that the previously discussed legislation is projected to “increase employment in Arizona by nearly 16,000 workers, boost state GDP by $1.5 billion, and increase the state’s population of working-age adults.” 

So what does this legislation and subsequent study in Arizona have to do with Utah? The answer is everything!

During Utah’s 2021 legislative session, Senator Curtis Bramble sponsored and worked to pass Senate Bill 43. This legislation is very similar to that passed in Arizona.

Senate Bill 43 allows the Utah Division of Occupational and Professional Licensing to issue an occupational license to a person who has come to Utah internationally or from a different state. Issuing a license to these persons will occur if they have at least one year of experience practicing the occupation they are seeking licensing for, it has been determined that their education experience and skills demonstrate competency, or if their previous jurisdictions licensing requirements were substantively similar to those in Utah when their previous license was issued.

Additionally, this legislation creates a licensure pathway for a person who has started licensure steps outside of Utah, but did not previously hold an occupational license. A person in this scenario could become licensed if it is determined that their education and experience are substantively similar to what is needed for that professional license in Utah.

With this sister legislation passed in Utah, it is entirely reasonable to believe that Utah can experience the same positive impacts that Arizona is currently experiencing. Thanks to increased license portability, Utah’s economy may soon see its labor shortages reduced and its GDP increase.