Solving the jobs skills shortage

Rob Portman
By Rob Portman

Unemployment in the United States is 8.1 percent, hovering above 8 percent for the 43rd consecutive month. Nearly 21 million Americans are struggling to find full-time work. Economists and politicians talk a lot about these and other numbers. But for families struggling to pay the electric bill, fill the gas tank, or buy groceries, it is more than just numbers – it’s personal. Jobs don’t seem to be available, except in positions that require certain skills workers don’t have.

As I’ve met with workers, businesses, and community colleges across Ohio, I have heard a frustrating and recurring story: Washington’s worker retraining programs are falling short.

The latest figures from the federal government’s Bureau of Labor Statistics show that employers in the United States are seeking to fill 3.7 million open positions. Many of these are well-paid jobs that could turn into long-term careers. In fact, one recent study found that job postings for skilled workers were up to 208,887 last month. Many of these openings were in Ohio, which came behind only California and Texas for skilled factory job openings. Also, a recent study by the Manufacturing Institute concluded that 74 percent of manufacturers are experiencing workforce shortages or skill deficiencies that are having a significant negative impact on their ability to expand operations and improve productivity.

Why do so many people remain out of work when employers have so many open positions?

Part of the problem is that the federal government’s job training programs are inefficient and sometimes duplicative. A 2011 report by the Government Accountability Office (GAO), Washington’s own investigative watchdog, showed that in 2009, nine federal agencies spent approximately $18 billion to administer 47 different federal employment and training programs. They found that 44 of the 47 federal employment and training programs studied “overlap with at least one other program.”

With billions of dollars of taxpayer money being spent every year, the job training system should be able to demonstrate that it is putting the unemployed back to work. But GAO found that “little is known about the effectiveness of most programs.”

We can do more to retrain the unemployed. We can do more to make the system accountable. And we can certainly do more to leverage taxpayer dollars.

That is why I have introduced the bipartisan CAREER Act alongside my colleague Senator Michael Bennet (D-CO). Our legislation makes job training more responsive to the needs of employers by requiring state and local workforce areas to give priority consideration in the distribution of job training dollars to programs that equip participants with credentials in-demand by industry. This provision delivers on a recommendation of the President’s Jobs Council to “align the training needs of workers and skills demanded by employers with education and workforce training programs.”

Next, our bill establishes economic incentives for accountability. With the billions of dollars the federal government invests in job training every year, it is imperative to quantify the return on taxpayer investment. The CAREER Act sets up an innovative “pay-for-performance” pilot program for job training services for states that voluntarily opt-in. Job training providers in these participating states would only be reimbursed for their services if they successfully place a worker in a good-paying job. This model builds a monetary incentive into the process so that job training services keep track of their outcomes.

As GAO discovered when it found overlap among 44 of 47 training programs, reorganization of the whole system must be a priority. Our bill requires the White House to submit to Congress a plan to increase the efficiency of the job training system by decreasing the number of job training programs without decreasing the quality of service delivered to the unemployed. Given all our economic problems, it is time for Washington to reorganize the massive network of programs into a streamlined and efficient resource for American workers.

With the commonsense, bipartisan reforms in the CAREER Act, we can take an important step forward with Washington’s job training programs. Now is the time to act to help Ohio’s businesses fill jobs. Now is the time to act to help put unemployed Ohioans back to work.

Rob Portman is a United States Senator from Ohio.