Providing workers with equitable access to job training opportunities is critical to expanding economic opportunity and bolstering economic growth. Last month, Senator Kamala Harris (D-CA) released the 21st Century Skills Act, a proposal to fund new job training benefits for workers interested in apprenticeships, certificate programs, or other training opportunities. The proposal would provide people with up to $8,000 in funds, with benefits scaling down for workers as their earnings increase. Beneficiaries would be able to use the funds for both the direct costs of a training program as well as for defraying non-tuition costs incurred while participating in a program. The proposal is notable for its scale, scope, and quality controls, and brings new energy to the debate around how to address workforce development challenges.
Measures to Address Scale and Quality
First, the proposal removes barriers currently in place around accessing workforce dollars, such as the requirement in the Trade Adjustment Assistance program that one must have recently lost work due to trade, or the myriad of eligibility limitations on Workforce Innovation and Opportunity Act (WIOA) dollars. But it also provides a significant dollar benefit to workers to use for tuition and other costs like transportation, books, or even rent and food while they are studying. In doing so, it covers the financial need for a wider swath of the population who may need to go back to school as skill needs shift over time, a change which some, but certainly not all, economists project may happen at a faster rate than before. The lack of consensus underscores the difficulty of predicting the speed and direction of job growth and skills needs. The 21st Century Skills Act would take a big step toward a nimbler “job training guarantee” model, building systems and a far larger funding stream than we currently have to respond as job market changes play out.
The proposal is also notable for its quality expectations: states are required to set quality standards, such as post-training wages and employment outcomes, and training providers must meet those standards. This requirement for both states and training providers goes beyond the minimal performance standards in WIOA—though assigning to states the difficult job of creating higher quality standards may result in varying measures of effectiveness. The proposal also anticipates the possibility that low-quality, high-cost for-profit providers may flood the market when new dollars are injected into federal aid for training workers—a challenge already facing higher education aid programs, where certificate programs that have a negative return on investment can still implement recruitment strategies to capture federal aid money. Harris’ proposal does not match the short-term Pell proposal’s restriction of excluding for-profits entirely from accessing dollars for short-term, non-credit-bearing courses (though the Pell proposal, in turn, does not include the wage outcome requirements like those mandated by the 21st Century Skills Act). Instead, the new proposal requires providers to cap tuition at just above community college levels, limiting the amount of federal aid profit-driven training providers can capture. These types of quality control elements that protect workers (and taxpayers) are critical to creating a successful universal job training benefit.
Capping tuition also asks employers to do more. The participating training provider can only charge significantly more than a community college if an employer agrees to pay the difference themselves. Data on the topic is limited, but from what we know, employers do less today than they once did to provide training opportunities for their employees, and are more likely to provide those opportunities to high-wage workers. The 21st Century Skills Act incentivizes employers to reverse this trend and participate as an invested partner in building training programs, as we’ve seen in some successful models. In the future, one could see a federal proposal taking this one step further, implementing a federal version of a measure recently passed in Washington State, where large employers are now required to pay into the training system through a tax.
The proposal should spur desperately needed debate about scale and quality in job training, giving new ideas to state policymakers who are in the midst of building and running their own job training programs, as well as to federal legislators debating the reauthorization of either the Higher Education Act or WIOA.