Tax credits could be provided for employees looking to better their skills.
Rep. Erik Paulsen (R-Eden Prairie) sponsors HF2779 that would create a Lifelong Learning Account program within the Department of Labor and Industry.
The bill would provide a 50 percent refundable tax credit for individual and business contributions to accounts used for worker education and training expenses. The maximum credit would be $1,000 for individuals and $500 for businesses.
Like 401(k) retirement accounts, employees would contribute to the account and employers would match their contributions on a dollar-for-dollar basis up to an annual cap.
Approved Feb. 28 by the House Higher Education and Work Force Development Policy and Finance Division, the bill awaits action by the House Finance Committee. It has no Senate companion.
“There are skill levels that are gained in initial education and training environments that are sometimes not enough to meet the needs and demands for advanced skills and opportunities,” Paulsen said. “The Hudson Institute has reported that about 60 percent of future jobs will require training that only 20 percent of the present workforce actually possesses.”
Similar programs have been successfully targeted toward low-income individuals.
Randall K. Johnson, state policy director for the Council of Adult and Experiential Learning, a national nonprofit organization, said a seven-year, multi-sector demonstration in Chicago, northeast Indiana and San Francisco showed the average monthly participation of participants was $33.82, and combined with employer contributions totaled an average $783.72 annually.
“We found that 70 percent of all participants across all sites used their account for goals related to their current job, to get a promotion with the same employer or related work with the same employer, or in the same industry,” he said.
Valerie Pace, IBM manager of corporate citizenship, said the company has announced a matching learning-account program beginning in July for its employees based on this model.
“This is particularly important for adult learners who don’t traditionally qualify under the rules of financial aid,” she said. “As an employer and as a state, the opportunity to recruit and retain talent, and to continue developing skills of our workforce, is key for our long-term future success.”