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Bill aims to spur job growth for the unemployed

In a rare show of bipartisanship, U.S. Sens. Cory Booker, D-N.J., and Tim Scott, R-S.C., have teamed up in an effort to spur job growth by introducing a bill to increase the number of registered apprenticeships in the U.S. As an incentive, the bill will also offer a tax credit to employers.

The senators are touting the Leveraging and Energizing America's Apprenticeship Programs (LEAP) Act as a private sector-driven piece of legislation that targets young people and aims to motivate employers to invest in the workforce.

An apprentice works on a whaleboat under the supervision of a boat builder.
Stetson Freeman | The Christian Science Monitor | Getty Images
An apprentice works on a whaleboat under the supervision of a boat builder.

"This is where, in many ways, government gets out of the way and gives tax breaks frankly for people who would do what the private sector would do," said Sen. Booker. "This is letting industry lead to fill a need that industry has."

By 2020 the U.S. is expected to experience a shortage of 5 million workers with the necessary training and education, according to a study by researchers at Georgetown University.

It's hard to understand how this is possible when 10 million people are unemployed in the U.S. About 16 percent of 16- to 24-year-olds are also unemployed, according to the Bureau of Labor Statistics. The figure is even higher among young minorities and those without college degrees.

But many employers complain that they can't fill jobs because many individuals lack necessary training, a problem some experts blame on a skills mismatch between employers and job seekers, according to the Senators offices.

The senators said their bill would help create 400,000 apprenticeships across the nation and fill a portion of the 4 million jobs they believe remain vacant because employers can't find workers with the necessary skills. It could also potentially attract more women into traditionally male-dominated industries.

This month the Bureau of Labor Statistics released its Job Openings and Labor Turnover Survey which revealed job openings by industry.

"These are structured programs—programs that are attenuated towards different industries. Industries ranging from information technology, energy, telecommunications, manufacturing, construction and the whole," Booker said.

The bill comes at a time when the role of apprenticeships in the nation is expected to grow beyond the traditional trades to high-growth, high-demand jobs. Data from the Department of Labor shows that there will be opportunities to expand the number of apprenticeship sponsors and training programs over the next decade.

Additionally, job demand in traditional trades, like building and construction—where most apprenticeships are offered—are expected to remain strong, and some of the newer apprenticeship occupations are expected to grow. Many high-growth technical operations, especially in the medical services industry, for example, are already recognized as having strong apprenticeship programs.

Finding common ground

Sens. Booker and Scott are an odd couple of sorts, due to the bipartisan nature of their initiative, something rarely found in Congress these days.

"The fact of the matter is, neither one of us has had to compromise in order to find common ground," Sen. Scott said.

They're also the only two African-American senators serving in the upper house of Congress, which they both joined last year. The senators said high rates of minority unemployment was part of the motivation behind the proposed legislation.

Currently, the unemployment rate for African Americans is more than 12 percent—double the national unemployment rate, according to the Bureau of Labor Statistics. Hispanic unemployment is nearly 8 percent.

And although the bill specifically targets young people, Booker and Scott said it could also help the long-term unemployed, many of whom are older Americans.

"Those folks who have been persistently and consistently unemployed will have an opportunity to get back into the workforce, because when you provide the tax credit as an incentive, employers will once again spend more time on the job training the individual, because they have the incentive to offset their risk," Sen. Scott said.

The tax credit stipulated in the bill is $1,500 for apprentices under age 25 and $1,000 for apprentices over 25.

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A global trend

Several European nations have highly successful apprenticeship programs supported by their respective governments, including England, Switzerland and Germany.

In Germany nearly half of all young people are involved in apprenticeship programs. And a study by the Global Talent Competitiveness index, which was developed by global graduate business school INSEAD and released last year, ranks Switzerland as the No. 1 country in the world for workforce talent out of 103 countries surveyed, highlighted the Swiss' "thriving apprenticeship program."

Researchers at the Center for American Progress found that those who complete apprenticeships earn an additional $240,000 throughout their careers than those who don't.

However, only 0.2 percent, or 358,000 of the nation's workforce, are in the 21,000 registered apprenticeship programs in the U.S., according to data from the senators' offices.

Robert I. Lerman, American University professor, fellow at the Urban Institute and founder of the Institute for Innovative Apprenticeship, has studied the impact of apprenticeships extensively.

He believes the senators' initiative could help tackle unemployment, but it will need the support of state and federal government agencies.

"It's extremely important for federal or state to back it up … with extensive marketing to show companies why it's good in their own interests to develop apprenticeships," said Lerman. "This would take care of at least some of the education costs that are always a part of apprenticeships."

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The Obama administration has also emphasized the need for job training in recent months. President Obama addressed the issue in his 2014 State of the Union address, and Vice President Joe Biden announced on April 7 the creation of a new apprenticeship partnership between community colleges, businesses, labor unions and industry organizations.

But the legislation introduced by Sens. Booker and Scott, if successful, could provide a workable model of collaboration between the private and public sectors.

Booker and Scott said their bill is modeled after South Carolina's apprenticeship program, which includes public and private partnerships for students, as well as a tax credit for job creators. Senator Scott said the state program has seen much success.

"I am pleased to work with Sen. Booker on this important piece of legislation, because the LEAP Act will build on South Carolina's already successful model at the federal level," Sen. Scott said.

Booker and Scott met at Facebook's Washington, D.C., headquarters on April 10 to participate in a live question-and-answer session online, discussing the LEAP act.

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