Arizona now recognizes out-of-state occupational licenses

Arizona has become the first in the country to recognize occupational licenses from other states, ending a redundant recertification process that labor analysts have critiqued as a drag on lower-income workers and local economies.

Lawmakers in Florida, a state that competes directly with Arizona for occupational workers, are considering similar legislation.

Arizona Gov. Doug Ducey, a Republican, signed House Bill 2569 into law on Wednesday. The legislation removes barriers for employment in the rapidly growing state by providing universal recognition of occupational licenses for anyone becoming an Arizona resident who held a similar license for at least a year in another state.

Analysts estimate that the law will affect workers in hundreds of occupations, such as funeral directors and hairdressers.

“Too often, our government has acted as an adversary, not an ally, for people who want to work. Well today, those days are over,” Mr. Ducey said during a bill signing at the state Capitol, which included a ceremonial red-tape cutting.

Democrats expressed outrage last week when the state’s Republican-controlled House passed the bill. Some argued that Arizona’s standards for occupational licenses could be weakened if the state accepts workers who have undergone less-stringent certification processes for credentials.

“Why should we dumb down our standards?” Rep. Pamela Powers Hannley, Tucson Democrat, told Reason TV, the broadcast arm of the libertarian Reason Foundation. “I see this as sort of deregulation for the sake of deregulation.”

According to the Bureau of Labor Statistics, licensing has expanded across the country. Roughly 25% of U.S. workers were required to have some sort of license in 2015, up from 5% in 1950.

Libertarian economists have long viewed Arizona, the nation’s fourth fastest growing state, as inhospitable for new arrivals seeking to set up small businesses that often require certification.

A study by the nonprofit libertarian Institute for Justice found that Arizona required licenses for workers in 68 of 102 low-income occupations, such as barbers, cosmetologists and dog groomers. Workers in those jobs were required to log hundreds of hours of practice and take exams to obtain their licenses, which cost an average of $612.

The institute concluded that Arizona’s occupational licensing regulations were America’s fourth most “burdensome,” behind Hawaii, Nevada and Colorado.

Mr. Ducey, a second-term governor and former CEO of ice cream vendor Cold Stone Creamery, has made slashing the notorious red tape a centerpiece of his administration. He calls the efforts common sense.

“We have licensing for yoga instructors. I think that’s insane,” the governor said in support of a deregulation bill during his first term in office.

According to The Arizona Republic, yoga instructors widely supported Mr. Ducey.

“These burdens hit low-income workers the hardest: over 65 percent of low-income occupations in Arizona require a license, and those jobs have some of the heaviest financial and training-based requirements when compared to other states,” Stephen Slivinski, a senior research fellow at the Center for the Study of Economic Liberty at Arizona State University, wrote Tuesday in the school’s Arizona Impact blog.

Licensing regulations are traditionally heralded as safeguards for consumers, but studies have found “no significant difference in public health and safety outcomes” among states with varying rules, Mr. Slivinski said.

Meanwhile, Florida lawmakers last week advanced from a committee a 120-page bill aimed at loosening or eliminating occupational license requirements for roughly 30% of the state’s workforce.

Gov. Ron DeSantis, a Republican, has called deregulation of licenses “a top priority of my administration.”