The Problem
Thanks to the dramatic growth in both mass incarceration and occupational licensing, millions of Americans with criminal records are barred from following the career path of their choice.
A 2017 study estimated that more than 19 million Americans, or 8% of all adults, had a felony conviction in 2010. That figure represents a tenfold increase from 1950 and has likely risen since. The study further estimated that roughly one in seven men and a staggering one in three African American men had been convicted of a felony. But those numbers are limited to felonies. Once misdemeanor convictions and arrest records are added in, the number of Americans with a criminal record of some kind soars to well over 70 million.
Meanwhile, nearly one in five Americans needs a license to work today—a fourfold increase from the 1950s. No longer limited to trades like law and medicine, many licenses require hundreds of hours of training or experience. One study by the Institute for Justice found that the average license for lower-income occupations requires completing nearly a year of education and experience, passing an exam, and paying $267 in fees. Moreover, many licensing burdens seem disproportionate to an occupation’s public safety risk. For instance, cosmetologists face more stringent requirements for their licenses than emergency medical technicians do for theirs.
These licensing restrictions and other economic collateral consequences come with a heavy price. One study by the Center for Economic and Policy Research estimated that in 2014, employment barriers for the incarcerated and those with felony convictions cost the nation’s economy up to $87 billion in annual gross domestic product. That was “the equivalent to the loss of 1.7 to 1.9 million workers.” Drops in the employment rate were particularly acute for black and Hispanic men and for men with less than a high school education.
As multiple studies have shown, steady employment is a key way to prevent re-offending. So it should come as no surprise that onerous licensing may worsen recidivism. A report from the Center for the Study of Economic Liberty at Arizona State University found that states with more burdensome licensing laws saw their average recidivism rates jump by 9%. By comparison, states with fewer licensing restrictions and no “good character” provisions had recidivism rates decline by 2.5%, on average. Notably, licensing burdens were second only to the overall labor market climate when it came to influencing recidivism rates.
Far too many licensing restrictions needlessly lock workers with criminal records out of their chosen careers. This report drives home the pressing need for reform.