Do Certificate-of-Need (CON) laws help or hurt healthcare workers? This research examines the impact of Certificate-of-Need (CON) laws—which require healthcare providers to prove economic necessity before opening or expanding—on the healthcare labor market in the U.S. CON laws, present in thirty-five states, have been previously evaluated for their impact on hospitals and consumers; however, their effect on health care workers remained unexplored. This study fills that gap by assessing the impact of CON on employment and wages of healthcare workers. The methodology employs an empirical analysis of CON laws using data from the Current Population Survey spanning 1979-2019. The authors argue that the theoretical impact of CON on wages and employment is ambiguous, necessitating empirical investigation. Variables include wages, employment, and the presence of CON laws, controlling for state and time-fixed effects. The findings reveal that CON laws do not have a significant effect on either employment or wages of healthcare workers. This challenges assumptions regarding the potential benefits or drawbacks of CON laws on the labor market for health professionals. Further research could explore the nuanced effects of CON laws on specific healthcare occupations or in different geographic regions.
As a contribution to the Southern Economic Journal, this article on Certificate-of-Need laws and the healthcare labor market aligns with the journal's interest in applied economics and public policy. By examining the impact of CON regulations on employment and wages, the study offers an empirical analysis relevant to debates concerning healthcare market structure and labor dynamics.