The gold rush of the mid-19th century brought 300,000 people to California. But few promises await new arrivals in 2024.
Those looking for economic opportunity today will discover why more than half a million people have abandoned the Golden State since 2020. High taxes and a stifling cost of living. Excessive regulations cast a shadow over the business climate, and an ever-increasing minimum wage prevents many young workers from gaining valuable work experience.
Newcomers will also find that California is hostile to workers with professional licenses from other states. Sacramento could help reverse the trend of population loss if lawmakers pass reforms recognizing out-of-state professional licenses.
Nearly 25% of jobs in the United States require some form of government sanction. This includes not just doctors, engineers and teachers, but also lesser-known examples like milk samplers, hair braiders and massage therapists. Currently, California allows 153 different occupations, while Kansas requires the fewest licensed occupations at 133.
Nearby Nevada, Arizona, and Colorado regularly welcome Californians – not only with lower taxes and a lower cost of living, but also by recognizing their out-of-state work permits. This means licensed professionals can quickly start working upon arrival, rather than spending time and money getting re-licensed in their new home state.
The COVID-19 pandemic highlighted the problem of barriers to professional licensing across states as additional health care workers were needed in states hardest hit by the virus. New York, for example, issued temporary executive orders recognizing licenses for out-of-state health care workers to meet growing demand for critical care.
While it is important that healthcare workers be able to work freely across states during emergencies, demand for workers from other states exists outside of pandemics and across all sectors. Building on the success of these temporary measures, states can make these reforms permanent and make it easier for all workers in all occupations to move and work across state lines.
Today, 22 states have professional licensing recognition policies. As the American Legislative Exchange Council’s new report, “Labor Policy Report: 50 State Factsheets,” explains, recognition laws assert that “if you have held a professional license for more than one year, states should grant you a state license.”
This means that a seasoned, licensed California paving contractor could almost easily move to Arizona and continue working, provided they pass a jurisprudential exam. In the opposite scenario, the paving contractor moving to California faces significant job uncertainty and may have to pass three exams and gain additional years of experience to meet California requirements before being allowed to perform the same job in the state.
Why move to a state that will require you to go back to school for a job you’ve been doing successfully for years? This can be even more burdensome for military families, as their spouses have little choice in where they live or work.
While California’s incredibly strict licensing laws create an economic barrier, many state legislators across the country have realized that licensing recognition is an effective way to attract experienced workers and enable qualified professionals to transmit their expertise across state borders.
If Sacramento leaders are serious about reversing the California exodus, this expansion of worker freedom is worth pursuing.
Gretchen Baldau is senior director of the American Legislative Exchange Council (ALEC) Trade, Insurance, and Economic Development Working Group.
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