Naples, FL – A new report released by the Foundation for Government Accountability (FGA) highlights the need to remove state statutes that punish workers that fall on tough financial times by rescinding their license to work.
Thirty percent of U.S. workers are required to have an occupational license to work, but in 15 states, these licenses can be removed or suspended for falling behind on student loan payments. With the number of workers facing the burden of student loan debt on the rise, this practice punishes those who fall on tough financial times. In practice, revoking licenses for workers who default on student loan prevents them from working, putting them deeper into debt and putting them at risk for falling into government dependency.
According to the report, at least 8,700 individuals have been affected by these laws, with the real impact likely being much higher. Instead of taking away access to a job for those who face financial burdens, FGA’s Keep Americans Working reform would repeal these burdensome laws, enabling workers to keep their licenses and job access while they work to pay off their debts.
“These laws act as a debtor’s prison—there’s no way to pay off student loan debt without an income,” said Victoria Eardley, FGA research fellow and author of the report. “Individuals shouldn’t have to worry about losing their access to work and their livelihoods if they fall behind on payments. States have an opportunity to empower these workers to regain control of their finances and pay off their debts by continuing to work and find independence.”
The full report can be found here.
The Foundation for Government Accountability is a non–profit, multi–state think tank that specializes in health care, welfare, and work reform. To learn more, visit TheFGA.org.