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American Workforce Act Would Provide Job Training Vouchers

The American Workforce Act, would provide high school graduates with a 9,000-dollar workforce training voucher, used to participate in education programs designed by employers for jobs in their industry.

Vouchers would be paid for in part by taxing wealthy private college endowments. Bill text is here.

“For decades, the federal government has spent billions propping up bloated colleges that serve—often poorly—a minority of our citizens. Meanwhile, the majority of Americans, who don’t go to college, are left behind. In fact, the federal government spends eight times more on college for the few than it does on job training for the many. My bill will right that wrong by investing heavily in a new workforce education strategy to help working Americans get ahead,” said the bill’s author Senator Tom Cotton-R Arkansas.

Click here to view a bill summary—a brief overview is below.

Background:

  • For decades, policymakers have largely ignored non-college workforce education. Meanwhile, college completion rates have stagnated while average college costs have grown to a staggering $35,331 per student with the collective student debt burden nearing $2 trillion.
  • The mounting cost of tuition has been matched by an ever more bloated higher education bureaucracy, which has increased 616% from 1976 to 2018, compared to only a 78% increase in student enrollment.
  • There are alternatives to college education, but the federal government’s approach to non-collegiate workforce education is outdated and government-led.
  • A new model for vocational education must not only focus on funding, but also put the employer at the center of workforce training, keep requirements flexible and simple, and ensure that spending follows the workers to maximize their choices.

The bill would:

  • Create a $9,000 federal voucher available to prospective “trainees,” defined as any citizen with a high school degree/GED, but without a bachelor’s degree or higher.
  • Offer an additional $1,000 bonus to employers for each trainee that is hired after completion of the workforce training program.
  • Require participating employers to provide training for positions paid at least 80% of the local median household income.
  • Allow the voucher to subsidize employer-led workforce training that offers a full time, paid position combining on-the-job experience and skilled workforce training.
  • Give employers wide flexibility to build their own training programs or delegate the training to a valid third-party entity, such as a trade association, community college, high school, non-profit, or union.
  • Require e-verify at participating employers.
  • Levy a one-percent tax on the fair market value of endowments held by private colleges that 1) have more than 500 full-time enrolled students, 2) have endowments worth more than $2.5 billion and $500,000 per full-time enrolled student, 3) do not have a religious mission.