Three essays on immigration and occupational licensing in the United States

In 2018, more than 43 million people, or 16.9 percent of the population in the United States, held a professional certification or license. Licensing regulations cover nearly 30 percent of occupations and have become a central labor market policy that shapes employment opportunities for many workers. Because of the enormous benefits, such as licensing wage premium and positive signals in the labor market, acquiring licenses has been extremely popular among workers over the last 60 years. In 2019, 44.9 million immigrants born in other countries and from different cultures resided within the United States. They work in numerous occupations and contribute to our economy and society. However, after migration, immigrants face vast barriers in finding matched occupations, applying for licenses, developing their careers, and improving their social status. These barriers, such as language ability and lack of citizenship and residency, further deteriorate their vulnerable situation. This dissertation investigates several social and economic issues in occupational licensing and immigration. We examine: 1) Licensing behavior and the changes in labor market outcomes through licensing in immigrants and their cohorts, 2) The labor market effects of granting occupational licenses to the Deferred Action for Childhood Arrivals (DACA) program recipients in states, and 3) The dynamic impacts of granting licenses to DACA recipients on their labor market outcomes using the synthetic control approach. To address the first question, this dissertation examines the likelihood of immigrants in different cohorts getting occupational licenses and the impacts of licensing on the labor market outcomes using two datasets: The Current Population Survey (CPS) and Survey of Income and Program Participation (SIPP). We found that immigrants, especially new and high-skilled immigrants, are less likely to get licenses than similar natives. However, the longer immigrants stay in the U.S. after migration, the higher the possibility of getting a license. In addition, immigrants gain significantly lower wages than similar natives in all cohorts, but the cohort of new immigrants performs relatively better in the labor market mainly because they are more educated and highly skilled. Overall, licensing reduces the wage gap between natives and immigrants. However, recent immigrants receive the lowest licensing wage premium among all cohorts, and somehow licensing expands rather than closes this wage gap in younger cohorts. We find that compared to native workers, only immigrants able to be licensed from English-speaking areas do relatively well, but immigrants from developing countries seem to do worse, even after acquiring a license. Moreover, the ability of an immigrant to speak English provides higher wages, but this positive effect gradually disappears during more years in the host country since migration. Finally, acquiring certain licenses, such as cosmetology, is not a successful labor investment for immigrants. Moreover, this dissertation further explores the relationship between the policy changes in occupational licensing and undocumented immigrants, specifically DACA recipients, using Difference-in-Difference estimators and a more advanced approach, Synthetic Control Method. The results prove that granting licenses raises recipients' wages by at least 12 percent. In addition, male recipients or recipients older than 24 are more positively affected by this policy change. However, all these positive impacts are only short-term and dissipate over time. Together these findings suggest that access to public benefits, including licensing, yields meaningful benefits for DACA recipients, but we are still questioning how effective this policy change is in the long term.