This post was contributed by Donna Klein, Executive Chair and CEO of Corporate Voices for Working Families.
When he goes before Congress on Thursday night to lay out his latest agenda for job growth, President Obama will face an audience at least partially hostile to his proposals. Maybe worse, he’ll face a relentlessly hostile economic environment. As reported Friday, the economy created virtually no net jobs in August—its poorest monthly showing in a year. Unemployment remained stuck at 9.1 percent. And the president’s own budget office, in its midyear review, has just forecast that the jobless rate will persist at 9 percent next year, when Obama faces reelection.
Sparking an economic revival and creating new jobs has no higher national priority. Yet as a business membership organization representing companies who employ millions of Americans, Corporate Voices for Working Families grapples with a related and urgent imperative: A widespread “skills gap,” which leaves many employers struggling to fill job openings even as millions of Americans search for work. We regard this skills gap as one of the most pressing issues facing business competitiveness and the economic security of working families today.
In Across the Great Divide, a report Corporate Voices published this year in partnership with Civic Enterprises and others, 53 percent of business leaders surveyed said their companies face a “very or fairly major” challenge recruiting employees with the skills, education and training their business needs. Those at smaller companies, who were responsible for more than half of new jobs created in recent years, felt the skills gap most acutely: Fully 67 percent said it was difficult to find and hire the right employees.
As federal leaders tackle the jobs crisis, we urge them to consider policies that address the deficient skills of the American workforce in equal measure. From the perspective of the diverse national employers associated with Corporate Voices, we urge the president and Congress to follow a few broad principals in their deliberations over our national spending priorities.
First, we must use our sharply constrained public resources in the smartest way possible. With millions of Americans out of work and historic national debt, we need to make sure every dollar invested in education and workforce training is targeted at the right jobs with the right skills. The Obama administration and Congress should focus on job training programs that have a proven record of success, producing positive outcomes for employers and American workers alike. Over time, dollars invested today in job training for low-skilled young adults in particular may have the greatest long-term payoff. One such program is Year Up—an intensive, one-year training program that gives urban young adults a unique blend of technical and professional skills, college credits, an educational stipend and a corporate internship. There are other model “enterprising pathway” training programs, of course, and many are well known to federal lawmakers. They should guide any decisions about new investments.
Second, we believe that federal tax incentives could help many employers large and small overcome their anxiety about expanding payrolls in this uncertain environment. We are pleased that the president is expected to endorse new tax credits for employers who hire unemployed Americans. Moreover, lawmakers would encourage private companies to hire—and to invest in education and training for those new employees—with a series of carefully targeted tax credits. Specifically, President Obama should call for tax incentives to employers who offer internship and apprenticeships programs, as well as other proven methods of work-based learning. In our experience, such programs offer one of the most effective ways to address the skills gap, and even a small financial reward could help employers expand these important efforts.
Finally, any effort to spur job growth and economic opportunity must surely focus as well on expanded access to higher education. The case is unequivocal: Of the 47 million jobs projected to be created in the U.S. by 2018, perhaps 30 million will require at least some postsecondary education. Those jobs will simply be out of reach for too many young Americans unless they are able to negotiate the demands of school and work.
Corporate Voices’ partner companies recognize that employers can and must be active partners in preparing the talent pool of skilled employees. Another important way to do so is to invest in their continuing education and training through Learn and Earn initiatives—programs offering workers the opportunity to pursue higher education and postsecondary credentials while they earn a living. Our Learn and Earn initiative identifies, promotes and encourages innovative partnerships between employers and community colleges that help people manage this balancing act—and earn postsecondary credentials. By documenting programs that work in a growing series of case studies, Corporate Voices hopes to interest other employers in proven efforts to cultivate a better-skilled workforce.
Undoubtedly, our national leaders must find a way to restore confidence, renew economic growth, and help the private sector create millions of new jobs. In our view, addressing this other crisis—the skills gap that limits the opportunities and dreams of too many Americans—is a necessary condition of success. We sincerely hope that reality is reflected in President Obama’s remarks Thursday night and in the policies favored by lawmakers in the important debate ahead.