James Madison Institute: Bridging the Divide: Licensing and Recidivism
High state occupational licensing barriers are associated with prisoners re-offending
An analysis of data from 30 states tested whether occupational licensing laws had a significant impact on recidivism. After controlling for the state economy, labor force participation rates, the degree of urbanization, and education levels, states that more stringently regulated entry into occupations most suited to lower-and middle-income occupations had higher re-arrest rates for former prisoners.
In other words, a one percent reduction in the number of licensed occupations could reduce re-arrest rates by one percent. The effects are even stronger for reductions in the average number of training days required to obtain a license. Overall, lowering barriers to entry by de-regulating occupational licensing laws could have a one-for-one impact on reducing recidivism.
Applying these results to Florida revealed that the positive impacts on re-arrest rates were even more important. A 10 percent reduction in the number of average training days would lead (statistically) to a 16 percent reduction in Florida’s re-arrest rate. Reducing the average number of training days to the national average (based on the 30 state sample) could cut the re-arrest rate by more than half.