Another Step for Improving Missouri’s Licensing Regime

In occupational licensing, Missouri has been ahead of the curve. In 2020, the state established a universal licensing reciprocity regime, allowing licensed professionals from other states to have Missouri requirements waived when they locate here. Last session, Senate Bill (SB) 150 strengthened that regime by removing the “compact exception,” which allowed certain interstate compacts to supersede Missouri’s reciprocity framework.

Senate Bill 895 would continue to strengthen Missouri’s occupational licensing laws. The bill mirrors SB 61 from last session (which nearly reached the governor’s desk), and would establish a form of licensing reciprocity for professionals who were not required to hold a license in their previous state but must obtain one when moving to Missouri.

The Mechanisms and Potential Intent of SB 895

There’s been a recent push in Missouri to join interstate compacts for various professions. While those may make things easier for Missouri’s licensing boards, they primarily help people leaving Missouri to work in other states. This bill focuses on making it easier for people to come here.

Specifically, SB 895 would allow professionals who have been working for three years in states that do not require a license to receive a two-year, nonrenewable, temporary license in that same field when they move to work in Missouri.

Oversight bodies can still charge fees and require that applicants take license-related exams. The goal of this bill does not appear to be reducing licensing requirements, but to allow people who move to Missouri to work during the process of acquiring a license. This is evidenced by a provision that requires the individual to complete Missouri requirements and apply for a permanent license once their temporary license expires.

Currently, unlicensed professionals would need to apply for a permanent license if they were to relocate to Missouri, so SB 895 would certainly improve the status quo. But it also forces us to consider why Missouri requires a license in certain occupations when other states do not.

Considering What Missouri Licenses

With every single occupational license, there are real costs: higher prices for consumers, higher barriers to entry for workers (resulting in fewer providers), reduced innovation, and loss of time and money for licensees. The central question in occupational licensing is whether these costs

are justified by clear and demonstrable benefits to public safety or product quality.

It is not unprecedented for Missouri to require unnecessary and burdensome licenses. For example, our state recently reformed licensing requirements for hair braiders.

Over the past few years, our annual Blueprint has included a section outlining the need for a review of Missouri’s existing occupational licenses. Many licenses are created and then exist for years without scrutiny. Licenses that are found to do more harm than good ought to be eliminated.

SB 895 would be another step toward improving Missouri’s existing licensing regime. However, if individuals are permitted to work in other states without a license, Missouri should carefully evaluate whether a permanent license is truly necessary here. Our state has been a leader in occupational licensing reform, and we should continue that trend.