Tax Incentives Needed To Close Workplace Skills Gap


The need to increase the workplace skills of the American workforce has become more urgent as the economy grows at a 4% annual clip.

Companies are hiring, but can’t find enough workers to fill available positions.

The most recent job numbers from the U.S. Bureau of Labor Statistics tell the story: there are nearly 6.7 million available, unfilled jobs — a number that exceeds the number of unemployed Americans (at just under 6.3 million) by 400,000.

Traditionally “blue collar” jobs, long seen as evaporating, are among the subset of unfilled positions. For example, there are nearly 500,000 manufacturing jobs available, but no one filling them; and more than 260,000 unfilled construction jobs — all of which require some degree of skills lacking among too many Americans.

Congress and the Trump administration have taken some steps to address this “skills gap” in the workforce, most recently by the congressional reauthorization last month of the Carl D. Perkins Career and Technical Education Act signed by the president. President Donald Trump also issued an executive order last year to expand the number of apprenticeships in the country.

More can be done. More needs to be done.

U.S. Representative Lloyd Smucker of Pennsylvania, who previously ran his family-owned commercial construction firm, introduced legislation earlier this year titled the USA Workforce Tax Credit Act to provide a credit against personal and corporate income taxes for investing in workforce development programs, apprenticeships and K-12 scholarship funds.

The bill (H.R. 5153) would provide a maximum $250,000 federal tax credit to spur individuals and companies to invest in improving the skills of workers and improving the educational opportunities of children to attend a better school. The legislation now has about three dozen co-sponsors.

This bill constitutes a new approach to addressing a real economic and human need, and would supplement existing federal and state efforts at job training and funding CTE programs by getting private interests to step up efforts to develop more workers to meet their needs.

Support for this legislation is far and wide, with a coalition of nearly 300 organizations ranging from labor, business, religious and not-for-profit entities from throughout the country.

Representatives from various trade organizations have weighed in strongly in favor of Rep. Smucker’s bill.

Workplace Skills: Upgrade Needed

Lois O’Connor, executive director of the Ammonia Refrigeration Association, recently stated “If you are an individual business owner and you have this tax credit, you can put it back into education, into trades and skills training.” Businesses can also “work with school systems to establish programs” to equip students with workplace skills.

Tom Weisenbach, Director of Business Development at the National Transportation Center based in Indianapolis, remarked that this bill “would be critical for us because the funds that would be generated from the tax credit would get to go to nonprofits that provide training for careers.”

One recurring theme among these and other leaders in industry and trade groups is the need to step up contact among businesses and educators, both for recruitment efforts, information flow and curriculum development, among other needs. Providing tax incentives to increase these and other activities and partnerships is vital to increasing the skills and qualifications of more workers, especially young people beginning their careers.

Congress and the administration have a plethora of issues to address in the remaining session, including passing appropriation bills for the 2019 fiscal year, and passing additional tax legislation. The USA Workforce Tax Credit Act is timely and urgent. It should be among the measures adopted before the year concludes.

Murphy is vice president of the Invest in Education Coalition.

501 (c)(3) Workforce Development Organization

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