Training workers for tomorrow: business, labor, and government must work together to plug the skills gap and keep America competitive - includes list of workplace training publications, seminars and organization - Cover Story

Nation's Business, March, 1993 by Joan C. Szabo

* Encouraging the creation of good jobs that are good not only because they pay well but also because they provide a good work environment.

Displaced workers also will be high on the list for retraining efforts. According to one estimate, approximately 2 million displaced workers lose their jobs each year because of shifts in technology, trade, and conditions of competition.

For those who will enter tomorrow's work force, the administration is expected to establish a nationwide youth apprenticeship program. When he was governor of Arkansas, Bill Clinton set up a state youth-apprenticeship program. A number of other states, including Oregon, Pennsylvania, and Maine, also have apprenticeship programs. (For details on Germany's apprenticeship program, see Page 30.)

Although a U.S. youth apprenticeship system is still in the early stages of development, the traditional apprenticeship programs administered by labor unions have existed since the 1800s. Most of these apprenticeship training programs--mainly in the building trades--have been negotiated between employers and unions in collective-bargaining agreements. The main purpose has been to train workers in the various skills required by the building trades.

Besides establishing a national apprenticeship system and initiating other training reforms, the administration may push for change in the way business and labor, as well as the federal government, spend their training funds. Labor Secretary Reich, for example, told the Senate Labor Committee that while U.S. firms spend an impressive $30 billion a year training their workers, "the problem is that $20 billion of that $30 billion goes to workers who already have university degrees, not to those who need it most. So we have to figure out how to concentrate those resources, both public and private, on the workers who need that continuous training and upgrading."

Among the key policy questions to be answered: How will federal training and retraining efforts be financed? In the past, Clinton suggested requiring businesses with more than 50 employees to spend a minimum of 1.5 percent of payroll on continuing education and training for all workers.

But in recent months, the president appears to have backed away from that idea in the face of opposition that includes small businesses concerned about the impact of yet another cost mandate from the federal government. Instead of a training tax, the Chamber proposes a tax incentive to encourage business to upgrade its workers' skills. The Chamber's proposed "human-capital initiative" would provide business with a tax credit similar to the tax credit recommended for businesses that invest in facilities and equipment.

"The country needs a proproductivity set of incentives--an investment credit--that leaves enormous flexibility and choice to private firms on the type of training that is offered," says Pat Choate, a consultant and author of The High-Flex Society, a book that identifies problems facing industrial America and suggests a program of feasible solutions.