Natural State News

Arkansas Gov. Asa Hutchinson recently signed Arkansas House Bill 1460 into law, which aims to increase occupational freedom by reducing regulations and obstacles.

The legislation, called the Workforce Freedom Act of 2021, will only require licensing for jobs that pose a clear risk to customers' safety.

"When a state imposes licensing rules on an occupation, workers cannot legally practice that trade without fulfilling a set of requirements," according to a report by the Mercatus Institute. "Occupational licensing is presumably intended to protect the public from unsafe and low-quality service. But a broad and growing consensus among economists suggests that these rules primarily serve to protect incumbent providers from competition at the cost of higher consumer prices and excessive barriers for new entrants in the field."

Arkansas ranked higher than the national average of states, according to the Mercatus Institute, which found that 52 of the 102 occupations surveyed in the state previously required some sort of occupational license.

The Mercatus Institute's study also found that "in assessing the burdens the state imposes on licensees—including fees, exams, age requirements, grade requirements and training and experience requirements—the report ranked Arkansas' licensing regime the second most burdensome in the nation."

According to the Reason Foundation's report on the strictest occupational license standards by state, Arkansas came in fifth place, with California ranking first.

"The most regulated state in the nation is California, which requires licenses for 177 job categories, nearly double the average. It is followed by Connecticut, Maine, New Hampshire and Arkansas," the Reason Foundation report states. "With the striking exception of California, western states tend to be less regulated than midwestern and eastern states."

The Reason Foundation study also indicates that occupational licensing laws are highly subjective, as shown by differences in which professions are licensed and how burdensome licensing requirements are from one state to the next.

Furthermore, the report by the Reason Foundation asserts that while occupational licensing laws are billed under the guise of defending the public from negligent or inadequate practitioners, they are a means of incorporating state regulation to serve narrow economic interests.

According to a previous report by Natural State News, occupational licensing is a major obstacle for individuals trying to make ends meet. The report also indicated that overbearing licensing requirements make it extremely difficult to "climb the economic ladder" and disproportionately apply to low-wage jobs.