By L. Michael Hager - 01/24/12 01:15 AM EST
Unemployment has become a major constraint to growth and a contributor to our growing inequality of income. It represents a loss of tax revenues on the one hand and a cost of unemployment benefits on the other. Even more significant is the human toil: As breadwinners lose their job skills over time, they tend toward discouragement and depression, putting family stability at risk.
What can be done to get the unemployed back to work? Here are three ideas for the administration and Congress to consider in this new year.
1. Heal the economy. Getting us back on a growth track is the best way to create new jobs. While our bloated deficit must be reduced over the medium and long term through a combination of budget cuts and revenue increases, right now we need to encourage U.S. businesses to resume hiring. That will only happen when consumers resume spending — not through the corporate tax breaks and deregulation that some are proposing. History has shown that government stimulus can really work if it is targeted on job creation, especially in the public services (e.g., teachers and first-
responders) and construction sectors.
2. Fill existing jobs. The U.S. now has 3.2 million unfilled job openings. According to a recent study by McKinsey & Company, many business executives say they have difficulty filling certain positions. For most of these jobs, the problem is mismatch. The unemployed lack the specific qualifications or experience.
Two recent nonprofit models link employers to job candidates via training. They are worth citing for their relevance to the Job Corps provisions of the Workforce Investment Act (WIA) of 1998.
The Education For Employment Foundation (EFE) promotes youth employment in the Middle East and North Africa, a region with the world’s highest youth employment rate. EFE has convinced employers that they can obtain a better workforce by pre-committing jobs to graduates who are specially trained for those jobs.
Year Up focuses on jobs in the financial services and information technology fields and provides intensive, yearlong education and training geared to internships with major U.S. employers.
In both these initiatives the employers commit jobs from the outset and pick up most of the costs.
While Job Corps centers around the country offer education and training like Year Up and EFE, they rely on post-training marketing to place the graduates. If the WIA were amended to require Job Corps contractors to secure employer participation from the outset, through both job pre-commitments and the financing of fellowships, more of the graduates would get jobs and the private sector would share program costs.
3. Create a new CCC/WPA. To get even larger numbers of the jobless (especially young people) back to work, legislators should take a cue from two successful programs of the Great Depression: the Civilian Conservation Corps and the Works Progress Administration. These two government initiatives of the 1930s provided jobs and job skills to some 12 million Americans at a time of acute national need, much like today. The CCC placed young men from unemployed families in countryside camps where they were paid to do outdoor construction work. In the larger WPA, open to anyone who needed a job, participants built many public buildings and roads and operated arts and literacy projects.
Last year Rep. Marcy Kaptur (D-Ohio) introduced a bill (H.R. 494) called the “21st Century Civilian Conservation Corps Act.” It would authorize the president to reestablish the CCC “as a means of providing gainful employment … through the performance of useful public work.” Unfortunately, the bill has languished for the past 12 months in the House Committee on Education and the Workforce.
How much longer can we tolerate near double-digit unemployment? Shouldn’t 2012 be a year for major action on all job fronts?
Hager is the former president of Education For Employment Foundation, a nonprofit organization based in Washington, D.C.