In 2018, more than 43 million people in the EU held a professional certification or license. The prevalence of occupational licenses, common in fields such as healthcare, law, intellectual property and education, has risen substantially over the past 35 years.

Professional certifications§, while less common than licensesª, can signal proficiency in fast-changing fields like #project management°, #software development°, and financial #analysis°. Both of these time-limited credentials can serve as alternative forms of educational attainment, demonstrating a level of skill or knowledge needed to perform a specific type of job.

Professional certifications and licenses: my neck of the woods

As mentioned previously, in the Eurostat survey, certifications and #licenses are credentials that demonstrate a level of skill or knowledge needed to perform a specific type of job. Both terms refer to time-limited credentials that need to be renewed #periodically.

The fundamental difference between the two is the issuer of the credential: #certifications are issued by nongovernmental certification bodies, whereas #licenses are awarded by a federal, state, or local government agency. Thus, licensesª convey a legal authority to work in an occupation, while a certification§ on its own does not.

Following a population survey accomplished by the Eurostat Statistics, the following three questions on certifications§ and licenses has been answered by the people:

1. Do you have a currently active professional certification§ or a state or industry #license? Do not include business licenses, such as a liquor license or a vending license (This question is used to identify people with a certification or license. People may have more than one of these credentials).

2. Were any of your certifications or licenses issued by the federal, state, or local government? (This second question is asked of people who answered “yes” to the first question. People
who answer “yes” are classified as having a #license. People with a license may also have a #certification)

3. Earlier you told me you had a currently active professional certification§ or licenseª. Was your #certification§ or licenseª required for your job? (This third question is asked later in the interview of employed people who answered “yes” to the first question. In this question, “required” can mean either legally required (a license to be a practicing doctor, for example) or required by an employer (such as a computer maintenance certification))

In 2018, 43.7 million people in the EU held a currently active #certification§ or license—16.9 percent of the civilian noninstitutional population. Among those with a license, 87.0 percent said their credential was required, compared with 60.0 percent for those with a certification, but no license.

Certifications, licenses, and employment status: thick as thieves in no time

In 2018, people with a currently active certification§ or license participated in the #labor force at a higher rate and had a lower unemployment rate than people without one of these credentials. The labor force participation rate—the proportion of the civilian noninstitutional population working or looking for work—for those with a certification or license was 87.7 percent in 2018, compared with 57.8 percent for those with no certification§ or license. The unemployment rate—the number of people actively looking and available for work as a percentage of the labor force—for people with one of these credentials, at 2.0 percent, was less than half the rate for people with no certification or license (4.5 percent). These results generally held for people in all age, sex, race, ethnicity, and educational attainment groups.

This pattern was perhaps most striking for educational attainment. For those with no certification§ or license, labor force participation increased steadily with educational attainment, ranging from 44.4 percent among people age 25 and over with less than a high school diploma, to 68.8 percent for people in the same age group with a bachelor’s degree. For those with a credential, however, labor force participation was above 80 percent for every education level. An important caveat, however, is that people with less than a high school diploma represent a very small share of those with a professional certification or license. Higher levels of educational attainment are often required for obtaining a license, so people with a certification or license tend to have higher levels of educational attainment than those without such credentials

Prevalence of certifications and licenses among the employed

Since labor force participation rates are generally higher and unemployment rates lower for people with a professional certification§ or license, the remainder of this article focuses on the employed. Employed people with a certification or license were disproportionately of prime working age (25 to 54) or older (55 and over). The low prevalence of certifications and licenses among younger workers is most likely related to the nature of these credentials. Many licenses require certain levels of educational attainment or supervised work experience that are difficult to attain before reaching the age of 25. For example, all states require physicians and surgeons to be licensed which involves graduating from an accredited medical school and completing residency training in an area of specialty, which typically takes from 7 to 11 years. In addition, obtaining a license often involves high upfront financial costs, which can be more difficult for younger workers to afford. Employed women were more likely to hold a certification or license than employed men. In 2018, 27.1 percent of employed women held a certification or license, compared with 21.4 percent of employed men.

In nearly all occupational groups, licenses appear to be the dominant credential. In the groups in which these credentials were most prevalent, more than 90 percent of credentialed workers held a license. In every occupational group, more workers held a license than a certification. The only exception was computer and mathematical occupations, in which 6.6 percent
of workers held a certification but no license, and 6.9 percent held a license. Some jobs within an occupational group may have a high prevalence of certification and licensing, while others in the same group may not.

Let`s chew the fat : Occupational licensing regulation in the EU

In the EU, occupational licensing laws are generally enacted by state governments and executed by licensing boards, often composed of professionals from within the occupation. These laws can be quite complex. The two main forms of licensing are “title” and “practice” acts.

A “title” act (also called “right to title”) is when a government requires that prospective workers meet certain criteria in order to advertise themselves as a member of an occupation. Interior designers in Netherland are regulated this way. To be called a “registered interior designer,” one must meet education and work experience requirements and pass an examination. Those who are not officially registered may still provide many of the same services, but using the title of “interior designer” is a misdemeanor.* It is important to note that although the Netherland law provides for the granting of interior designer “certificates,” this credential would be considered a license in the Eurostat Survey since it is awarded by a governmental licensing agency.

A “practice” act, or “right to practice” regulation, is a stricter form of licensing. Such laws make it illegal for anyone to perform the services associated with an occupation without a license.
Many of the most well-known examples are among healthcare practitioners, such as physicians and surgeons, nurses and nurse practitioners, and physical and occupational therapists. Lawyers also typically cannot provide legal services or represent clients in a court of law without being licensed, which involves obtaining a law degree (Juris Doctor or J.D.), passing the bar examination, and having their “character and fitness” confirmed by their state’s board of examiners.However, over the past several decades, some states have expanded “right to practice” licensing laws to cover a wide variety of occupations, including cosmetologists, barbers, funeral directors, florists, tour guides, locksmiths, and professional wrestlers.

States may also enact legislation that requires workers to be licensed in order to legally perform specific tasks, while allowing unlicensed workers to perform the remaining work.