PRESS RELEASE from the
ILLINOIS POLICY INSTITUTE

CONTACT: Melanie Krakauer (312) 607-4977

Burdensome licensing of work costs Illinois 135,000 lost jobs and $15B in lost economic activity
New report finds occupational licensing reform would improve state economy while empowering poor and minority families

CHICAGO (Oct. 16, 2024) – Illinois’ overregulation of occupational licensing is creating a less equitable state dynamic.

According to a new report from the Illinois Policy Institute’s Center for Poverty Solutions, nearly 25% of Illinois’ workforce requires a license to work – or about 1.6 million people needing to expend time and money to get government approval to work.  The institute found this amount of licensing and government regulation has led to 135,000 lost jobs and $15 billion in lost economic value, while also worsening racial and income inequality in the state.

State and local lawmakers can reduce inequalities by making it easier to get certain jobs. Black and Latino people are 5 and 11 percentage points, respectively, less likely to be licensed than white people. Women are also more likely to work in licensed careers than men.

Regulated licenses include cosmetology, makeup artist, hair braiding, community association management, locksmithing, fire alarm installation, bill collection, cemetery customer service and more. It costs Illinoisans an average of 234 days to fulfill licensing education and experience requirements, the report found.

“Some Illinoisans can afford the tens of thousands of dollars and hundreds of hours to take education programs and licensing exams, but often poor and minority workers cannot,” said Josh Bandoch, head of policy at the Illinois Policy Institute. “Burdensome regulations can rob people without the luxury of time and money the chance to pursue their dream, have a career they want or provide for themselves and their family.”

Other consequences of excessive licensing include reduced interstate migration and a stifled unemployment rate, which is already the second highest in the nation.

Five common-sense strategies for reforming occupational licenses:

• Implement effective sunset reviews: Regularly review state licensing regulations to ensure they are not overly burdensome, are necessary to protect public health and safety and provide return on investment. The state of Illinois began this effort in 2019 but has not made any recommendations for licenses to reduce or remove.
• Remove unnecessary licenses: Eliminate licenses for occupations that are safely practiced in at least 10 other states without requiring a license. Examples of such occupations in Illinois include hypnotist and sanitarian in training. Similarly, Illinois could reduce licensing requirements for certain occupations, bringing them in line with other states.
• Establish alternate pathways to licensing: Create apprenticeship programs, high school programming and other routes to licensure, enabling individuals to gain experience directly in the trade and receive a license upon completion, without attending expensive educational institutions.
• Allow online, asynchronous educational options: Enable online training and education programs for any non-hands-on requirements to make licensing requirements more accessible to people who cannot attend in-person classes. Illinois already allows online options for renewal and continuing education requirements.
• Adopt universal licensing recognition: Allow individuals with licenses in good standing without criminal complaints from other states to work in Illinois without having to requalify, making it easier for workers to move to Illinois and continue their careers. 26 states have enacted some form of universal license recognition and Illinois introduced a bill last legislative session to recognize licenses from other states that could be revived.

To read more about occupational licensing, visit illin.is/licensing.

For interviews or interviews, contact media@illinoispolicy.org or (312) 607-4977.