Occupational licensing due for an overhaul?

Overhauling occupational licensing in Australia and letting homeowners, renters and social-housing tenants move more easily for work could deliver tens of billions of dollars in productivity gains. That is the claim of a submission to the federal government’s employment white paper, developed by the Committee for Economic Development of Australia (CEDA).

In the submission, CEDA notes that occupational licensing is widespread in Australia, with around one in five people in jobs with registration requirements.

According to CEDA, the OECD’s indicator of occupational entry regulations shows that the level of licensing on personal services in New South Wales and Queensland is among the top five most restrictive of 21 OECD nations including the US, the UK, Canada and Europe. CEDA estimates that Australia could gain up to $5 billion each year from reform to match the best-performing countries in this area.

CEDA makes three recommendations to streamline occupational licensing:

1. Extend the automatic mutual recognition of occupational registration scheme introduced in 2021 to all states. Reduce exclusions and take steps to remove requirements in occupations not subject to restrictions in other states.
2. Review licensing regulations considering whether they meet stated objectives, international experience and recent technological developments such as online reviews that allow consumers to assess quality more easily.
3. Reduce licensing and shift regulation where necessary towards quality standards for goods and services within consumer law.

More information about the submission is available at the CEDA website.