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CSLB study finds roughly 70,000 potentially unlicensed contractors; board weighs outreach and budget request
Summary
An internal CSLB staff study presented Aug. 4 estimates roughly 70,000 potentially unlicensed contractors in California and recommends targeted outreach, data sharing with cities and a possible budget change proposal to expand enforcement and public‑education resources.
Registrar David Folk told the joint enforcement and public affairs committees that staff analysis of complaint data, business‑registration lists and local business licenses shows a large underground contractor population. "What the study will show is that we have approximately 70,000 unlicensed operators," he said during the Aug. 4 meeting.
The presentation described two analytic approaches: (1) cross‑matching Data Axle commercial listings and local business license records against the CSLB master license portal to identify businesses that appear to operate without a CSLB license, and (2) applying complaint‑rate extrapolation (using the licensed contractors' complaint rate to estimate unlicensed contractor counts). Staff reported a range of estimates produced by the combined methods, including a median around 70,000 and a separate computation that identified more than 17,000 potential active operators via data‑matching. Don Wynn, manager of the test development unit, said staff cleaned and deduplicated multiple data sources before analysis.
Committee members and staff emphasized that the numbers signal both consumer‑protection risk and an opportunity. Enforcement chief Steve Grove said enforcement resources are already stretched and that the board should consider a budget change proposal to expand investigator capacity and IT support. Carol Gagnon, licensing chief, noted that even if a modest share of the estimated unlicensed operators applied for licenses, application fees could yield meaningful revenue: "If 10% of those 70,000 contractors apply to get a license, that's about $3,000,000 in revenue," she said. Committee chairs suggested pilot outreach to the 36 sampled cities and working with the League of California Cities to improve business‑license data collection.
What happens next: staff said a final report will be distributed publicly at the CSLB quarterly board meeting on Sept. 2 and committee members were asked for input on which findings and recommendations to prioritize, including whether to propose a BCP to fund additional enforcement, public affairs and IT work.
