Effects of Occupational Licensing on DACA Recipients: A Synthetic Control Approach

Abstract

Since 2014, 17 states have allowed DACA recipients to acquire occupational or professional licenses. This policy change benefits DACA recipients, eases the labor shortage, and boosts the economy. This paper evaluates the impacts of this policy change on labor market outcomes of DACA recipients, using the generalized synthetic control method to create counterfactuals for treated units using control group information. Our results suggested that granting licensing increases the wages of DACA recipients. Moreover, granting licensing seems to raise education attainment, such as more DACA recipients finishing associate degrees. However, these positive effects are only shown in the short term (the first two to three years after the policy change). Then, gradually, we find no differences in the labor market outcomes of DACA recipients in the treated group relative to its control. In conclusion, even though access to licenses does improve labor market outcomes for DACA recipients, we are still questioning how effective this policy change is.