Analyzing the Extent and Influence of Occupational Licensing on the Labor Market

Abstract

This study examines occupational licensing in the United States using a specially designed national labor force survey. Estimates from the survey indicated that 35% of employees were either licensed or certified by the government and that 29% were licensed. Another 3% stated that all who worked in their job would eventually be required to be certified or licensed, bringing the total that are or eventually must be licensed or certified by government to 38%. We find that licensing is associated with about 18% higher wages but that the effect of governmental certification on pay is much smaller.