Occupational Licensing Reforms Tackle Workforce Barriers

Lawmakers are reviewing proposed occupational licensing reforms designed to streamline regulations that compound Connecticut’s worker shortage crisis.

The General Law Committee held a public hearing Feb 7. on a pair of measures that make much-needed changes to the state’s occupational licensing requirements.

CBIA testified in support of SB 135, which sets a maximum fee of $100 for occupational licenses, and HB 5433, which allows military service to satisfy licensing requirements.

As of February, 2023, Connecticut has 100,000 job openings, a 46% increase since February 2020, while the labor force has declined by more than 53,000 people over the same period.

Connecticut has recovered just 89% of the historic 292,400 jobs lost in March and April of 2020 due to pandemic shutdowns and restrictions.

Even if every unemployed person was hired, employers would still be faced with over 20,000 unfilled positions.

Regulatory Burden

A November 2022 Institute for Justice study of 102 lower-income occupations revealed that Connecticut required 64% of those to have a license, exceeding the national average by 53%.  

The average fee for an occupational license in Connecticut is $290, again exceeding the national average.

Those fees range from $1,010 for a public preschool teacher to $0 for a number of occupations, including animal trainer and landscape contractor.

Those fees include charges for application review and license issuance, exams, background checks, credit reports, and fingerprinting. 

Applicants also bear significant costs for the thousands of educational hours required to apply for a state license.

Connecticut was ranked the most 15th burdensome state for occupational licensing, faring worse than Massachusetts and New York.

Economic Cost

The Institute for Justice study showed that licensing requirements cost Connecticut approximately 48,000 full-time jobs, while shrinking the economy by $400 million. 

CBIA’s Ashley Zane told the committee licensing costs were a barrier to entry for many individuals, especially those looking to raise themselves out of poverty.

“SB 135 lowers the cost of doing business in the state for approximately a quarter of the state’s workforce.”

CBIA’s Ashley Zane

“While many employers cover the costs for licensing of their employees, many individuals are still required to cover the cost on their own while saddled with student loan and training program debt,” she said.

“SB 135 lowers the cost of doing business in the state for approximately a quarter of the state’s workforce and makes Connecticut a more attractive place to work through high paying and in-demand careers.”

The Greater New Haven and Quinnipiac Chambers of Commerce and the Home Builders and Remodelers Association of Connecticut were among the groups that testified in support of the bill.

Veterans

Zane also testified in support of HB 5433, telling the committee that allowing military service to satisfy licensing requirements was “a positive step in removing barriers to entry for qualified individuals.”

“In many instances, military training requires a significant combination of classroom instruction and physical aptitude to qualify for certain positions,” she said.

“For example, in order to become an interior electrician in the Army, an individual must pass the Armed Services Vocational Aptitude Battery Test, complete 10 weeks of basic training, seven weeks of advanced individual training, and meet various other requirements.”

She noted that veterans are highly valued by employers because of their in-demand skills.

Allowing military service to satisfy licensing requirements was “a positive step in removing barriers to entry for qualified individuals.”

Zane

“The average term of service is between four to eight years,” she said. “Veterans are trained and then employed in their field gaining critical skills and experience, many times in high-stress situations.”

While the bill was supported by GNHCC, HBRAC, and a number of employers, it was opposed by the state Department of Labor and unions.

Labor Commissioner Dante Bartolomeo testified that state law allows veterans, within two years of discharge from service, to apply to the DOL apprentice training program for evaluation.

However, if the commissioner approves the applicant, they must then be reviewed by the appropriate examining board, followed by an an additional evaluation from the Department of Consumer Protection.

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For more information, contact CBIA’s Ashley Zane (860.244.1169) | @AshleyZane9.