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Crow Holds Hearing to Examine Skills Gap Facing Small Businesses

Washington, June 5, 2019

Washington, D.C.— Yesterday, Rep. Jason Crow (D-CO) Chairman of the Small Business Subcommittee on Innovation and Workforce Development gathered business owners, labor experts, and industry representatives to discuss ways private industry and the government can collaborate to ensure that the labor force has the training necessary to meet the skill demands of the economy now and in the future.

“This problem is not unique to one sector of the economy,” said Chairman Crow. “From the lack of tower climbers to build out telecommunications networks in the most rural parts of our country to the void of specialized custodians to clean biomedical waste at healthcare facilities and the lack of specialized labor in the construction trades, all industries are feeling the strain of inadequate pathways to employment.”

As the number of skilled applicants lags behind employer demand, small firms are struggling to hire qualified workers. For over a year, more jobs have been available than people actively seeking employment. This problem represents a threat to economic growth, as firms cannot expand without the ability to fill job vacancies with qualified individuals. Many of these openings call for applicants that have some post-secondary training, like vocational and community college programs, but not a four-year degree. These “middle skill jobs” now account for more than 50% of all job openings. As the workforce struggles to keep up with the skill demands of the economy, apprenticeship programs, federal job training, and emphasis on technical and vocational education have been proposed as possible solutions. 

Because of the inability to hire talented workers, entrepreneurs are often forced to pick up the slack. Small business owners are now working almost double the hours of the average American worker. Up to 14 hours compared to the average of 7.8 hours per day.

The panel gave the Subcommittee the chance to examine the challenges employers experience hiring skilled workers, review current workforce development programs, and consider policy options moving forward. 

“In a tight labor market with low unemployment, most companies struggle to hire at the speed of Tilson,” said Joshua Broder, CEO of Tilson Technology Management. “Instead of quantity, Tilson’s hiring challenges are related to candidate quality and basic knowledge about current and emerging technologies, project management, leadership experience and cultural fit.”

“Even given the large number of opportunities, there is a lack of potential employees searching for careers in the HVACR industry,” said Talbot Gee, CEO of HARDI (Heating, Air-conditioning and Refrigeration Distributors International). “In a survey of HVACR instructors and administrators, 56 percent reported their programs were under-enrolled while only 10 percent reported their programs were over-enrolled. This reported lack of demand stems in part from the lack of information about the industry shared with students by the industry, trade schools, parents, and guidance counselors.”

“The apprenticeship model has been and can continue to be a viable, alternative means of affording access to educational and skills training that leads to employment, this is especially true for individuals for whom higher education is neither a necessary nor a viable path to the labor market,” said Ronald Marlow, Vice President for Workforce Development at the National Urban League. “The fact that both the Obama and Trump administrations have embraced apprenticeship as an effective strategy to meet industries’ needs is proof of apprenticeships’ continuing viability.”

“As of April 2019, the unemployment rate for IT occupations stood at 2.4 percent, nearly a full percentage point below the national unemployment rate,” said Tim Herbert, Senior Vice President of Research and Market Intelligence at CompTIA. “This means employer demand in many regions of the country and for many skills routinely outpaces the supply of workers. For small businesses seeking to keep up, competing for scarce tech talent can be incredibly trying. The bottom line, there is much work to be done on multiple fronts to ensure a healthy, vibrant, and sustainable tech workforce.”

“Apprenticeship programs and technical training create pathways to economic empowerment for small firms and their potential employees,” said Chairman Crow. “Skilled workers will lay the foundation for technological advancement and fuel the growth and development of small employers and the future of America’s workforce. The public and private sector must continue to work together to solve this pervasive issue.”

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