[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
SKILL, UPSKILL, AND RESKILL: ANALYZING NEW
INVESTMENTS IN WORKFORCE DEVELOPMENT
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON INNOVATION,
ENTREPRENEURSHIP, AND WORKFORCE DEVELOPMENT
OF THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
HEARING HELD
MARCH 31, 2022
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 117-049
Available via the GPO Website: www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
46-948 WASHINGTON : 2022
-----------------------------------------------------------------------------------
HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELAZQUEZ, New York, Chairwoman
JARED GOLDEN, Maine
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
KWEISI MFUME, Maryland
DEAN PHILLIPS, Minnesota
MARIE NEWMAN, Illinois
CAROLYN BOURDEAUX, Georgia
TROY CARTER, Louisiana
JUDY CHU, California
DWIGHT EVANS, Pennsylvania
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
BLAINE LUETKEMEYER, Missouri, Ranking Member
ROGER WILLIAMS, Texas
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
CLAUDIA TENNEY, New York
ANDREW GARBARINO, New York
YOUNG KIM, California
BETH VAN DUYNE, Texas
BYRON DONALDS, Florida
MARIA SALAZAR, Florida
SCOTT FITZGERALD, Wisconsin
Melissa Jung, Majority Staff Director
Ellen Harrington, Majority Deputy Staff Director
David Planning, Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Jason Crow.................................................. 1
Hon. Young Kim................................................... 2
WITNESSES
Mr. Gerald Lee Arnold, Business Manager & Financial Secretary
Treasurer, Denver Pipefitters Local #208, Denver, CO,
testifying on behalf of the Denver Pipefitters Joint
Apprenticeship Training Committee.............................. 5
Dr. Mordecai Ian Brownlee, Ed.D., President, Community College of
Aurora, Aurora, CO............................................. 7
Mr. Joseph W. Kane, Fellow, The Brookings Institution,
Washington, DC................................................. 9
Ms. Diane Benck, General Operations Manager and Owner, West Side
Tractor Sales Co., Lisle, IL, testifying on behalf of the
Associated Equipment Distributors.............................. 11
APPENDIX
Prepared Statements:
Mr. Gerald Lee Arnold, Business Manager & Financial Secretary
Treasurer, Denver Pipefitters Local #208, Denver, CO,
testifying on behalf of the Denver Pipefitters Joint
Apprenticeship Training Committee.......................... 29
Dr. Mordecai Ian Brownlee, Ed.D., President, Community
College of Aurora, Aurora, CO.............................. 33
Mr. Joseph W. Kane, Fellow, The Brookings Institution,
Washington, DC............................................. 38
Ms. Diane Benck, General Operations Manager and Owner, West
Side Tractor Sales Co., Lisle, IL, testifying on behalf of
the Associated Equipment Distributors...................... 45
Questions for the Record:
None.
Answers for the Record:
Mathematica Policy Research.................................. 48
Additional Material for the Record:
None.
SKILL, UPSKILL, AND RESKILL: ANALYZING NEW INVESTMENTS IN WORKFORCE
DEVELOPMENT
----------
THURSDAY, MARCH 31, 2022
House of Representatives,
Committee on Small Business,
Subcommittee on Innovation, Entrepreneurship,
and Workforce Development,
Washington, DC.
The Subcommittee met, pursuant to call, at 10:04 a.m., in
Room 2360, Rayburn House Office Building, Hon. Jason Crow
[chairman of the Subcommittee] presiding.
Present: Representatives Crow, Davids, Houlahan, Phillips,
Young Kim, Williams, Tenney, and Garbarino.
Chairman CROW. Good morning. I call this hearing to order.
Without objection, the Chair is authorized to declare a
recess at any time.
I would like to begin by noting some important
requirements. Standing House and Committee rules and practice
will continue to apply during hybrid proceedings. All Members
are reminded that they are expected to adhere to these rules,
including decorum.
House regulations require Members to be visible through a
video connection throughout the proceeding, so please keep your
cameras on. Also, please remember to remain muted until you are
recognized to minimize background noise.
In the event a Member encounters technical issues that
prevent them from being recognized for their questioning, I
will move to the next available Member of the same party and I
will recognize that Member at the next appropriate time slot
provided they have returned to the proceeding.
The onset of the COVID-19 pandemic created one of the most
significant upheavals in the history of the American labor
force. Between February and April of 2020, the U.S. economy
shut 22 million jobs and the unemployment rate skyrocketed from
3.5 percent to 14.8 percent. Congress stepped in to pass the
CARES Act, stopped the economy's freefall and provided support
throughout the pandemic. This quick action, combined with the
American Rescue Plan, paved the way for one of the fastest
recoveries from a recession in our nation's history.
In 2021, the U.S. economy added 6.6 million jobs, the most
on record. Considering the deep wounds of the pandemic, this is
a monumental achievement. While we have recovered most of the
jobs lost during the pandemic, our country is in the middle of
an ongoing labor shortage. This shortage is complex in its
origin and we cannot attribute it to any one factor. The
pandemic upended life as we know it. It slowed legal
immigration, caused a wave of early retirements, and forced
many to exit the job market out of concerns for their health or
family obligations. All of these factors have contributed to
the shortage we are seeing today.
The labor shortage impacts all businesses, but it
particularly concerns our nation's entrepreneurs. But there is
more to this than appear lack of workers. For many small firms,
a general lack of applicants is not the problem. Instead, they
are not finding qualified candidates, workers with the proper
skills to do the job and do it well.
Guaranteeing an adequate number of skilled workers in the
labor force could be the first step to smoothing out this rough
labor market. Fortunately, we have many established tools at
our disposal to accomplish this goal. For example, initiatives
like workforce boards, apprenticeships, community college, and
career and technical education can help us upskill the American
labor force.
But as it stands, these initiatives are not getting the
funding they need. Over the past decade alone, the workforce
system has seen a nearly 20 percent decline in federal funding
when adjusted for inflation. I think we are seeing the impacts
of this underinvestment in today's economy.
Fortunately, the Biden administration has made a commitment
to reversing this trend. Workforce development expansion,
improvement in funding are prominent features of the bipartisan
Infrastructure Investment and Jobs Act. The infrastructure law
allows states to obligate funds from programs like the National
Highway Performance Program toward workforce development
activities. The law provides grants for programs that train and
certify workers on the installation of energy-efficient
technologies in partnership with labor unions and employers.
The law also includes the Digital Equity Act of 2021, which
creates two new grant programs that provide funds that develop
digital equity plans and help get people the requisite skills
to compete in today's economy.
Lastly, the overwhelming majority of funds in IIJA are
subject to Davis-Bacon requirements to ensure workers are paid
a fair wage. These are excellent developments but we must find
more ways to modernize the American labor force.
So today, I hope we can take a close look at existing
programs and discuss new initiatives to expand our country's
pool of skilled workers. By investing in workforce development,
we can help ease our current labor shortage and position
American workers to thrive in the future.
I would now like yield to the Ranking Member, Ms. Young
Kim, for her opening statement.
Ms. YOUNG KIM. Thank you, Chairman Crow. I want to thank
you for holding this very important topical hearing, and I want
to thank all of our witnesses joining us virtually today and
testifying before us.
Our entrepreneurs are our nation's job creators. Their
innovative products and services fuel our economies and
communities. They take risks. They train employees. And they
provide two-thirds of all jobs. The new jobs.
As a small business owner, I know the adversities and
obstacles that small businesses must overcome to succeed. The
hurdles small businesses are facing right now are high.
Inflation is soaring, supply chains are in chaos, and
regulations are mounting. Small businesses are also facing
historic job openings and labor shortages. Recent job numbers
show positive growth as we reopen from the pandemic and
mandates come to an end. However, the current job market
contains 1.14 million less employed workers than prior to the
pandemic. And main street still struggles to find employees.
The most recent job openings and labor turnover summary
reported 11.3 million job openings and recent surveys report
over half of all small business owners are having trouble
finding qualified people to hire compared to a year ago.
NFIB surveys also indicate historically large numbers of
small businesses are struggling to increase their workforce
despite almost half of all employers raising wages.
Furthermore, 22 percent of small business owners reported labor
costs as the top business problem, just two points below
December's 48-year record high. These staffing shortages have a
direct impact on our economy. Seventy-seven percent of small
business owners reported that staffing shortages are resulting
in significant to mild lost sales opportunities. Small
businesses do not just need to fill open positions but they
also need qualified and skilled workers. In February, 61
percent of small businesses reported hiring or trying to hire
employees, and an astounding 93 percent of those small
employers hiring or trying to hire reported few or no qualified
applicants for those open positions. Inaction is not an option
as small business place Help Wanted signs on their doors and
innovation is stifled due to a lack of workers.
The Small Business Entrepreneurship Council found that just
5 percent of small business owners agree that Congress's
policies are helping the economy and small business. Only 5
percent. We must change that and enact pro-growth policies that
support small businesses in meeting their workforce needs and
consumer demand.
Republican Members on this Committee have solutions. I am
proud to have introduced the bipartisan H.R. 6450, the SCORE
for Small Business Act of 2022. The SCORE program provides
mentorship, education, and training opportunities for small
businesses. Recently, SCORE has hosted webinars for small
business owners on adapting to the trends transforming the
workforce. By authorizing and modernizing this important
program, we can ensure that SBA's resource partners are
prepared to help entrepreneurs meet their business needs,
including labor and workforce development.
Additionally, my colleague, Vice Ranking Member Williams,
has bipartisan legislation to utilize the Small Business
Development Centers and Women's Business Centers to assist
small businesses in hiring career and technical education
graduates.
There is no ``one size fits all'' solution to meet the
diverse demands of our unique small business communities.
However, I am confident that we can work together to empower
small businesses with resources to address the skills gap,
promote career and technical education opportunities, encourage
apprenticeships, and restore the small business economy so our
job creators can prosper.
I look forward to hearing from our witnesses today and I
hope to work with my colleagues to find real solutions to
support our small businesses in finding labor and closing the
skills gap.
Thank you, Chairman. I yield back.
Chairman CROW. Thank you, Ms. Young Kim. The gentlelady
yields back.
I would like to take a moment to explain how this hearing
will proceed. Each witness will have 5 minutes to provide a
statement and each Committee Member will have 5 minutes for
questions. Please ensure that your microphone is on when you
begin speaking and that you return to mute when finished.
With that, I would like to introduce our first witness.
Our first witness is Mr. Gerald Arnold. As the business
manager since 2017 and a Member of the Joint Apprenticeship
Training Committee since 2008, he has worked to enhance
recruitment, training, and retention of union pipefitters. His
leadership of educational efforts in the trade has earned him
several appointments by state and city leaders, including a 3-
year appointment by the governor of Colorado in 2019 to the
Business Experiential Learning Commission in which he guides
development of a youth apprenticeship program. Thank you, Mr.
Arnold. I look forward to your testimony.
Our next witness is Dr. Mordecai Brownlee, the sixth
president of the Community College of Aurora in my district.
During his tenure, he has focused on creating initiatives that
lift up lower-income members of our community and prepare them
for careers. In 2020, Dr. Brownlee was featured by EdTech
Magazine as one of the 30 Most Interesting Voices in Higher
Education who are shaping the conversation around educational
technology and information technology. In 2022, he was featured
by Diverse Issues in Higher Education Magazine as a new school
leader representing the next generation of college presidents.
Thank you, Dr. Brownlee for being here today.
Our third witness is Mr. Joseph Kane, a fellow at the
Brookings Institution. His work focuses on a wide array of
infrastructure issues, including transportation and water
infrastructure. Recently, his work has explored transportation
and placemaking, climate investment and the challenges and
opportunities facing the country's infrastructure workforce and
its essential workforce more broadly. Prior to Brookings, Mr.
Kane was an economist at the U.S. Bureau of Labor Statistics.
Thank you, Mr. Kane. I look forward to your testimony.
And I will now yield to the Ranking Member to introduce our
final witness.
Ms. YOUNG KIM. Thank you, Chairman.
Our fourth witness is Ms. Diane Benck, general operations
manager and owner of West Side Tractor Sales Company who is
testifying today on behalf of the Associated Equipment
Distributors. West Side Tractor Sales Company, a John Deere
construction equipment dealer, has been in business for an
impressive 58 years and has 11 locations across Illinois and
Indiana. West Side Tractor Sales Company is also a family-owned
business. While Ms. Bank and her two brothers are the second
generation of the family in the business, the third generation
is already involved in the company. I understand Ms. Benck
takes pride in coaching and training the next generation to
have the same success and growth as her and her brothers. She
is also very active in a variety of industry-related
associations. She served two terms on the Associated Equipment
Distributors Board of Directors before becoming the first
female volunteer leader of the association in 2018 when she was
inaugurated as Chairwoman. She is currently on the AED
Foundation's Board of Directors, which focuses on workforce
development and attracting skilled workers to the industry. Ms.
Benck has also twice served as president of the John Deere
Construction Dealer Association. I know Ms. Benck's experience
as a small business owner and vast knowledge on workforce
development issues will be extremely beneficial to our hearing
today.
So, Ms. Benck, I thank you for the time to join us today
and for taking the time to testify. I yield back.
Chairman CROW. Thank you, Ms. Young Kim.
And I will remind the witness to keep to the 5 minutes. Ms.
Young Kim and I run a tight ship on the Small Business
Committee and we ask that people stay within their time. There
is a clock on the screen to help you with that effort to
prevent you from being gaveled out. So, with that I thank all
the witness for being here today. And Mr. Arnold, you are
recognized for 5 minutes.
STATEMENTS OF GERALD LEE ARNOLD, BUSINESS MANAGER & FINANCIAL
SECRETARY TREASURER, DENVER PIPEFITTERS LOCAL #208; MORDECAI
IAN BROWNLEE, ED.D., PRESIDENT, COMMUNITY COLLEGE OF AURORA;
JOSEPH W. KANE, FELLOW, THE BROOKINGS INSTITUTION; DIANE BENCK,
GENERAL OPERATIONS MANAGER AND OWNER, WEST SIDE TRACTOR SALES
CO.
STATEMENT OF GERALD LEE ARNOLD
Mr. ARNOLD. Thank you, Chairman Crow, Ranking Member Young
Kim, and Members of the Subcommittee. I appreciate the
opportunity to testify in front of you this morning to talk
about registered apprenticeship programs, and specifically our
program that we operate here in Denver, Colorado.
During the introduction, it was noted that I currently
serve as the business manager at Denver Pipefitters Local 208.
I also have the pleasure of recently being elected as the
district vice president for our International Union, the United
Association of Pipefitters, Plumbers, HVAC Service Technicians,
Sprinkler Fitters, and Pipeliners.
My experience has been one as an actual apprentice. So, I
served my apprenticeship from 2003 until 2008 working for a
contractor called Murphy Company during that entire 5 years and
really just enjoyed every single second of the opportunity. I
was extremely thankful for getting the chance to learn how to
become a professional pipefitter and I wanted to give back as
soon as I completed my apprenticeship program. I had the
opportunity to become an instructor here in our program
teaching mostly welding classes to 3rd, 4th, and 5th year
apprentices. So, I basically took the summer off after I
completed my apprenticeship program and came back the following
school year. Instead of being a student, I became an instructor
and really enjoyed the 7 years getting a chance to teach our
apprentices.
After that, I had the opportunity to be hired and took the
position of training director in charge of the day-to-day
operations of our registered apprentice program, continuing
education and certification programs that we do here as part of
the training department.
In 2017, I was elected by our membership to serve as their
business manager and continued to play an integral role as the
secretary of our Joint Apprentice Training Committee that
oversees and guides the overall operations of the training
program here at Local 208. We are excited because we have 230-
plus apprentices currently in our program somewhere along the
5-year program and we continue to see those numbers increase.
Apprentice programs, I think, are the most effective way for
training construction professionals, specifically my experience
being with pipefitters on both the construction and HVAC
service side. And the reasons for that is being able to partner
the on-the-job training with related instruction given in the
classroom this allows those apprentices to have the full
experience. We try to duplicate what they will encounter on a
jobsite and out here in the classroom provide a safe space for
apprentices to make mistakes. Most people learn much more from
their mistakes than they do from their successes.
Unfortunately, you cannot allow that to happen when you are on
a customer's property as we are building their equipment or
safety is a concern. So, we want to have properly-trained,
qualified journeypersons overseeing that on-the-job portion but
allow that safe space down here in the classroom to have folks
make mistakes and learn from it. No matter how much you try,
you cannot duplicate every possible scenario a construction
pipefitter or an HVAC service technician would run into on a
jobsite because not every building is the same. Each system is
designed for that particular building the way it was
engineered, the way the architecture was completed to make that
kind of a special system. And while systems have similar faults
and need similar types of repairs, having that on-the-job
component partnered with the classroom training really does
prepare them for any possible scenario they could run into as a
qualified journeyperson as they continue their career.
The tremendous benefit that I think our model provides
specifically to small businesses is our contractors of all
sizes have the same access to the great training program and it
is based off of an hourly training contribution. While we
utilize the multi-employer, it is an 80 cents per manhour
contribution into our ERISA-governed training trust fund. And
so, while we have contractors that have hundreds of employees,
the vast majority of our employers have 30 or less employees.
They are small shops, and there is no way they would have the
resources and the capital needed to undertake a large training
effort like we have at our apprenticeship program here at Local
208.
So, I looked at our list. I actually printed out a report
this morning, and I am pleased to say that we have 80 percent
of our contractors, like I said, have less than 30 employees.
So, Air Tech Mechanical for one was at the top of my report
because it goes alphabetical order. They have 12 members
working for them. And out of those 12 members, two of them are
apprentices and one of them is a pipe tradesman that is an
entry level position really to get some experience and decide
whether or not they want to pursue the whole career and apply
for the apprenticeship program.
And so, we enjoy about a $1.8 million annual operating
budget for the training program, and those contractors, like I
said, have the same access that our large contractors with 400-
plus members may be working for them right now.
Because it is directly related to the amount of employees
they have and the amount of work that they are performing, it
makes it an equitable access for not only our employers but
also our apprentices. The apprentices do not have to face any
kind of personal financial burden. They get compensated for on-
the-job training----
Chairman CROW. Mr. Arnold, Mr. Arnold, you are over the 5
minute time so I am going to have to stop you here but we can
finish up during the question and answer period as we dive into
it with the members. Thank you very much.
Dr. Brownlee, you are now recognized for 5 minutes.
STATEMENT OF MORDECAI IAN BROWNLEE
Mr. BROWNLEE. Good morning. And thank you for this
opportunity, Chairman Crow, Ranking Member Young Kim, and
Members of the Subcommittee, my name is Mordecai Brownlee, and
I am the proud president of the Community College of Aurora.
CCA is part of the Colorado Community College System and
serves over 10,000 students annually. At the onset of the
pandemic, our enrollment dropped 12 percent. However, I am
proud to share that our college has rallied hard for our
students, and to date have recaptured 7 percent of that loss
and we won't stop until all students have been accounted for.
Uniquely, our institution serves in the most diverse region
of the state and student demographics represent that reality
accordingly. As a federally designated Hispanic Serving
Institution and Minority Serving Institution, 64 percent of our
students identify as students of color, 51 percent of our
students are Pell grant eligible, and 50 percent of our
students are first-generation college students. With five
continents and over 90 countries represented at our
institution, we are proud to serve a rich and diverse student
body that includes the state's largest immigrant population.
It is also important to note that our small business owners
within our area represent this rich diversity as well.
Community colleges, like ours, stand on the front lines and in
service to the most disadvantaged students and those hardest
impacted due to the pandemic through our mission of open-
access, affordable, high-quality postsecondary education, and
workforce training. Through partnerships with community
organizations, such as our Aurora Chamber of Commerce, Aurora
Economic Development Council, Arapahoe/Douglas County Workforce
Development Council, and the BuildStrong Academy, CCA is
utilizing data and feedback provided by small businesses and
large industries to re-envision and transform our student
learning experiences. Intended to train displaced workers,
nontraditional adult students, and first-time-in-college
students, these efforts seek to upskill or reskill to obtain
industry-recognized credentials that align in-demand, high-wage
occupations. Currently, we are designing new programs in
healthcare, renewable energy, and construction management, and
offer hybrid, online, and in-person instruction outside the
typical working hours to accommodate our students' varied
schedules.
Our students are directly impacted by the various
socioeconomic challenges that face other metropolitan
communities around the nation. Lack of reliable transportation,
childcare, broadband access, and a supportive network have
historically created barriers to a quality education and the
obtainment of their dreams. Listening to the voice of our
students, CCA has worked in hand with our student body to
eliminate barriers and provide resources to promote equitable
access and opportunities for our students.
Take, for example, Victoria Browning. Prior to attending
CCA, Victoria held a full-time job earning $14 an hour to
support her two young children, while struggling to address
thousands of dollars in student debt. Thanks to a grant created
by the U.S. Department of Labor, the Strengthening Working
Families Initiative at CCA offered students like Victoria
childcare, college counseling, and career support. Or, take for
example our Asegurando Learning Program. To address the equity
gap in student achievement between students of color and their
white peers, CCA was awarded a Title V grant from the U.S.
Department of Education. From there, our Asegurando Learning
Community was born. Recently, CCA established a new division
within the college to focus strategically on the placement of
students into career mentorships, internships, externships, and
apprenticeships to level the playing field among those who have
access to supportive networks and those who are not as
privileged.
Supports at the federal level are critical for our
continued success. Pell Grant financing for very short-term
programs, and fund increases for TRIO, Minority Serving
Institutions and the nation's Hispanic-Serving Institutions
could dramatically transform institutions. Such transformation
would provide the resources to create and sustain efforts aimed
to retool and upskill the workforce necessary to power small
businesses and industries while helping our most struggling
students finance college.
Additionally, our workforce programs, while innovative and
responsive, are expensive to operate. For example, programs in
healthcare and advanced manufacturing are in great demand; but
are also among the most expensive programs to offer. To
maintain our roles as leading providers of workforce training
and maintain affordability for students, it is critical that we
make meaningful investments in career and technical education
infrastructure at community colleges. Dedicated community
college job-training programs, like those originally included
in the Build Back Better Act, would fund these critical
efforts.
In conclusion, in today's culture where the call for
innovation and increased efficiencies are abundant, community
colleges cannot afford to be viewed as inefficient and
nonresponsive. Our community small businesses and industry
partners are depending on us to be responsive to their needs.
Our students are depending on us to create an environment where
equitable student success is fostered and every barrier towards
the fulfillment of that success is removed. The Community
College of Aurora stands ready to meet these needs for years to
come.
Thank you and I look forward to answering any questions you
may have.
Chairman CROW. Thank you, Dr. Brownlee.
Mr. Kane, you are recognized for 5 minutes.
STATEMENT OF JOSEPH W. KANE
Mr. KANE. Good morning, Members of the Committee. Thank you
for this opportunity. My name is Joseph Kane, and I am a fellow
at the Brookings Institution. The purpose of my remarks today
is to frame specific challenges and opportunities facing the
country's infrastructure workforce, includingthe potential to
expand career pathways.
As you know, workers have faced an increasingly polarized
labor market during the pandemic and over the last few decades.
Middle-skill jobs, which typically require more than a high
school diploma but less than a 4-year college degree have grown
slowly. At the same time, the country's infrastructure,
including transportation, water, energy, and broadband has
increasingly faced gaps in investment. That is not only true
when it comes to physical upgrades but also when it comes to
preparing a skilled workforce to construct, operate, and
maintain all these systems.
However, the Infrastructure Investment and Jobs Act offers
an unprecedented opportunity to address these gaps and
accelerate momentum around careers that pay higher wages,
require shorter term credentials, and need a new generation of
talent. To maximize this opportunity, federal, state, and local
leaders cannot just create short-term jobs, mainly construction
jobs, for the same people. They need to be ready to harness
funding in ways that expand opportunities to more workers--
women and men, the unemployed and underemployed, and younger
students and adult learners across a broad range of positions
in the skilled trades and other in-demand fields. They need to
focus on creating an infrastructure talent pipeline that can
offer more sustained opportunity to workers and provide greater
certainty to employers, including small businesses.
The country's infrastructure workforce challenges primarily
center around a lack of visibility and flexibility. Addressing
these challenges begins with acknowledging the variety of
infrastructure career pathways nationally. In 2019, before the
pandemic hit, more than 17 million workers, or nearly 1 out of
every 10 workers were employed in infrastructure across 91
different occupations. A basic challenge facing infrastructure
employers, including utilities, transportation agencies, and
engineering firms, is a lack of awareness among Americans that
these careers even exist. This obscurity continues even as
infrastructure jobs offer more competitive, equitable wages
paying 30 percent more to workers at lower ends of the wage
spectrum, in other words, workers with the least amount of
experience who are just starting their careers.
Prospective workers may also lack awareness of and easy
access to the training needed for these careers, which tend to
emphasize work-based learning opportunities. As a result, there
are training and retention gaps. Nearly a quarter of all
infrastructure workers will need to be replaced over the next
decade. But some occupations are expected to see 10 percent or
more of their workers leave each year on average. That is
especially the case for infrastructure jobs with older workers
near retirement or they have the continued struggles reaching
younger students, women, people of color, and other
individuals.
Addressing these challenges hinges on proactive federal
leadership to ensure greater visibility and flexibility. That
does not mean filling one type of job in one place, but rather
having multiple entry points available for more people in more
places. This flexibility matters because many unemployed and
low-wage workers in hospitality, retail, and other industries
following the pandemic need to transition to better jobs, which
will require many branching pathways.
Expanded financial and technical capacity around regional
planning and employer engagement is a must, as is an expanded
focus on future-looking skills development and flexible
training opportunities.
For example, employers can partner directly with community
colleges and other educational institutions to help students
gain the necessary skills and qualifications to be hired.
Federal leaders could support such collaborations and sector
partnerships through expanded funding and technical assistance
as part of competitive grants in the infrastructure law.
Apprentice and pre-apprenticeship programs offer another earn
and learn opportunity. Beyond additional federal funding for
apprenticeships, expanding the Work Opportunity Tax Credit
could further incentivize employers to test new approaches.
Above all, the ultimate reach and impact of any new federal
funding must ensure there are flexible training opportunities.
Programs focused on younger workers, particularly those out
of school, out of work, and facing other social and economic
disadvantages, can grow the infrastructure workforce. Service-
based learning opportunities and expanded Pell grant
eligibility for short-term job training are two ways that
federal leaders could address these youth workforce needs. Of
course, many other nontraditional and underrepresented workers,
including women, people of color, and middle-aged workers can
realize greater opportunity in this sector. Enhancing existing
federal efforts, such as the women in apprenticeship and
nontraditional occupations grant program could help community-
based organizations provide more accessible on ramps.
Members of the Committee, I believe there are enormous
challenges facing our infrastructure workforce, but also
enormous opportunities. Admittedly, the issues that I described
today only scratch the surface of the issue. But as
conversations evolve in the coming months, I want to emphasize
the opportunity you and other leaders have to further refine
and test potential applications of any new funding. To not
simply reinforce existing and inequitable workforce gaps, but
to create stronger pathways for all prospective workers. Thank
you.
Chairman CROW. Thank you, Mr. Kane.
Ms. Benck, you are now recognized for 5 minutes.
STATEMENT OF DIANE BENCK
Ms. BENCK. Chairman Crow, Ranking Member Young Kim, and
distinguished Members of the Subcommittee, my name is Diane
Benck and it is my pleasure to appear before you today as a
small business owner directly impacted by the skilled workforce
shortage and on behalf of Associated Equipment Dealers (AED),
the international trade association representing companies that
sell, rent, service, manufacture construction, agricultural
farm, mining, energy, material handling, and industrial
equipment.
I am the general operations manager and co-owner of West
Side Tractor, a full-service John Deere construction and
forestry equipment dealer.
You know, I would like to say that my family story is
really the story of the American dream. My father, who grew up
with nothing, joined the Air Force during the Korean War. The
Air Force gave him technical skills and education so that when
his service was done, he went to work as a technician for a
John Deere dealership. My parents dreamed of having their own
business, so when a territory for John Deere opened, they put
every penny they had and created something of their own.
If we fast-forward 60 years to today, we have 11 locations,
approximately 35 employees, and my brothers and myself are
working towards passing the business now to the third
generation of family members.
As a small family-owned, capital-intensive business, we
have a lot of challenges right now, from supply chain issues,
inflation, and ever-changing regulatory and tax environment.
But the greatest need is right where my father started his
career in the technical trades. And whether you are Wagner
Equipment in Aurora, Colorado, or BJF Corporation in Placentia,
California, you cannot find skilled workers, particularly to
serve as diesel service techs.
According to the A.D. Foundation Commission study, the
equipment industry foregoes at least $2.4 billion in lost
revenue annually due to the inability to find skilled service
technicians. That is money that could be used to further expand
our businesses and create more jobs and economic activity.
It is also important to understand that if equipment
dealers do not have the skilled workforce needed to repair and
maintain heavy equipment, construction projects are delayed
costing our customers in lost time and money. It truly creates
inefficiencies up and down the supply chain.
Most service technicians attend a 2-year technical college
degree program that focuses on heavy equipment technology.
Traditionally, the occupation was stereotyped as dirty.
However, with recent innovations, today's heavy equipment is on
the cutting edge of technology requiring technicians to work
with computers to diagnose and fix problems.
In fact, when you include technical education with our
manufacturer mandated and in-house training, a typical service
technician logs similar classroom hours to someone with a
bachelor's degree from a university without crippling student
loan debt.
These are very well paid positions that are truly careers.
At West Side Tractor, our apprentices start at more than $22 an
hour and quickly escalate to $45 an hour within 4 years, not
include comprehensive benefits and other incentives. We could
easily increase our technician workforce by 20 percent if we
could find qualified workers. A.D. is doing exceptional work
accrediting heavy machinery technology programs at high schools
and colleges, as well as educating parents, teachers, students,
and guidance counselors about the well-paying, rewarding
careers in the equipment industry. Yet, we continue to push our
kids to pursue 4-year degrees when there are millions upon
millions of jobs in the skilled trades open which require
taking on minimal debt and an opportunity to work towards that
American dream that has worked so well for my family.
The problem is not unique to equipment dealers. Our
manufacturers do not have the workers to build the equipment
and our customers do not have the skilled workforce to operate
the equipment. Meanwhile, infrastructure projects await,
particularly after passage of the bipartisan infrastructure
bill.
To address this issue, the country must provide increased
funding to career and technical education programs to build the
pipeline of skilled workers and incentivize students to pursue
alternatives to 4-year degrees. The skilled workforce shortage
continues to be the equipment industry's greatest challenge. It
hinders growth and economic opportunity, creates
inefficiencies, and impacts the country's competitiveness. As a
nation, it is imperative that we steer the next generation to
careers in the skilled trades and align public policy and
investments to growing this important workforce for our future.
Thank you for the honor for appearing before you today and
I look forward to any questions you may have.
Chairman CROW. Thank you, Ms. Benck. I appreciate your
testimony.
Thank you to all the witness for being here today.
I will begin by recognizing myself for 5 minutes.
Starting with Mr. Arnold, Mr. Arnold, I had a chance to
recently visit with you all at Pipefitters Local 208 in Denver
and we had a discussion about the United Associations of
Veterans and Piping Program. I have been a long-time veterans
advocate and one of the issues we have always struggled with is
that gap between when someone takes off the uniform to when
their veterans benefits start to flow and how we often lose so
many veterans who fall through the cracks during that gap
period. But your VIP program is extremely innovative in that it
closes that gap and it starts the training while they are still
in uniform so it is a seamless transition.
So, could you just tell a little bit about that program,
what you have learned about it and how effective it has been in
helping our veterans and helping the trades and the workforce?
Mr. ARNOLD. Thank you, Chairman Crow.
Yes, I ran out of time there but I do appreciate the
question. Our Veterans in Piping Program really works well for
everybody involved. So, the United Association started that
program years ago. It is now operating on eight different bases
across the country. And what it allows is while military
personnel are still active duty, they are allowed to take 18
weeks of accelerated training in either welding, HVAC service,
or sprinkler fitting. And the nice part is because that
training takes place while they are still active duty, they are
still receiving their pay and benefits from their time in the
service, and then they complete that training prior to
mustering out of the service. And towards the end of the
training, they are allowed to pick the location of their
choice. And so whatever apprenticeship program that they want
to enter in the United Association, they get to go back to the
area of the country that they would like to live along with
starting their career and they get what we call direct entry
into the program of their choice. And so, because that is
seamlessly happening, we are allowed to tell them exactly what
the wage is going to be, provide employment verification
letters so they have the documentation they need to apply for
mortgages or if they are going to rent an apartment or a house,
their family has some idea of what they are going to be looking
at doing. They know they have full health insurance benefits.
And so, it really makes it a nice transition. They receive 1
year's credit for the 18 weeks of accelerated training they
received during their time in the military and then they are
automatically qualified to start receiving their GI Bill
benefits due to being accepted into the registered
apprenticeship program. So those GI Bill benefits work based
off their on-the-job training hours and they receive the
highest amount at the very beginning where they are learning
the lowest wage as a first-year apprentice obviously makes a
percentage of a qualified journeyperson. And then that pay
increases as their skill and knowledge increases. So, it really
makes it a nice transition for the individual and it also helps
us as an industry. The skillsets that they bring, their sense
of responsibility and accountability. Everything really our
employers are looking for. And so, it has been a great
partnership.
Chairman CROW. Thank you, Mr. Arnold. Just an example of
frankly how our labor unions are really leading the way. You
know, it is a brotherhood and sisterhood, not just an
organization, and I think that culture translates really well
for a lot of our veterans and your ability to do that. And I
would like to see these programs expand. I think the other
trade unions are uniquely qualified to actually expand these
into the service and help our veterans transition. And I
appreciate your leadership in that regard.
Dr. Brownlee, in the minute that I have left I would like
you to comment briefly on your community college's work with
local business development centers and how we can expand those
relationships and how they are doing.
Mr. BROWNLEE. Thank you so much for that question there,
Chairman Crow. And what I would just say is, again, as you
heard me talk about our various Chamber of Commerce, Arapahoe/
Douglas Workforce Council, the work that we are doing with the
various entities here, in our service area of the Community
College of Aurora is just critical conversations that we are
having to ensure that the workforce meets the various shortages
that are being experienced. We certainly all heard about the
great resignation or the great recalibration. Essentially, we
are just having conversations about how to retool and upskill
our community individuals, our adult learners, as well as our
traditional age students to create new opportunities, new
career pathways to ensure the growth and sustainability of our
communities. I am excited about the conversations that we have
been having with our industry partners to create new pipelines
of training, on job training and opportunities, and it just
creates, again, as we think social and economic mobility, it
certainly excites us here at the Community College of Aurora to
be a part of this advancement of our communities. Thank you,
sir.
Chairman CROW. Thank you so much, Dr. Brownlee.
My time has expired.
The Ranking Member, Ms. Young Kim, is now recognized for 5
minutes.
Ms. YOUNG KIM. Thank you, Chairman.
Ms. Benck, I am pleasantly delighted to hear that your
father served in the Korean War. And so, please, offer my
deepest appreciation for his service. As an immigrant from
South Korea, obviously, I have a very soft spot when it comes
to thanking, especially all the veterans, but especially Korean
War veterans. So, my hat is off to you, your father. And your
father has founded this family-owned business which you are now
taking over and your family and your children are also taking
over. So, it is really important because all of our witnesses
are job creators in our nation. But most importantly,
supporting our veteran-owned, women-owned, and also minority-
owned businesses are something that Chairman Crow and I and
Members of this Committee are passionately supportive of.
Ms. Benck, your testimony references the many challenges of
being a small business owner, including inflation, supply
chains, and ever-changing tax and regulatory environment. So,
could you talk about how your business is managing with all of
this economic headwinds?
Ms. BENCK. Well, I have to say that, you know, I have been
in this business for 35 years and this has definitely been one
of the most challenging in a good way. We have never produced
more sales and our bottom line has never looked better. And it
has never been more frustrating or difficult because we cannot
price tractors next year. We do not know when we are going to
get availability. So, I mean, I have never seen the supply
chain as disrupted as it is. I mean, I hope as a country we can
get this fixed. I know all the construction equipment
manufacturers are working hard but it is super challenging to
do business right now.
From a tax environment, you know, we always carry very
large rental fleets so we always have changing rules on
depreciation or like-kind exchange. And so, 1 minute, you know,
we have these hundreds of millions of dollars of rental fleets
and then the tax rules change and then we have to kind of
regroup. The 100 percent depreciation did sort of negate the
like-kind exchange program going away but, you know, we
certainly have challenges for the next couple of years as those
depreciation amounts start to phase out. But really, the
biggest problem we have right now is this labor shortage as I
have discussed. You know, our capacity to serve our customers
is diminished because of not being able to hire anyone. And
technicians are number one on the list. But we also have had a
lot more struggles just hiring administrative people and
salesmen. And we have had very low turnover rates compared to
some of the other numbers that I have been reading about
through this whole great resignation. But it is definite more
challenges right now than I have ever seen in our history.
Ms. YOUNG KIM. I know I heard that from your testimony,
too. I mean, the shortage of having the qualified technician
workforce is critically the biggest challenge in your industry
and as is in all industries because you mentioned the capacity
to serve your customers is deeply affected because you do not
have the qualified technicians. So, you testified that you
could easily increase your technician workforce by 20 percent
if only you could find qualified workers. So, talk more about
how the current labor shortages have impacted your business
operation and revenue, as well as those members of AED. I am
sure you hear more and talk about this every single day.
Ms. BENCK. You look at we are putting up growth and sales
numbers of 15-20 percent and our labor sales were only up 6
percent. That would have easily been up 15 percent if we had
the number of people that we needed to have. And, you know, you
hear stories around the country of you call for a service call
and it is 2 weeks before a technician can get there. In the
meantime, that tractor is sitting. And we are about ready to
flood the entire industry with more money through the new
infrastructure bill. So, you know, these challenges just become
greater and greater and greater. And for us, we believe we
really need to reach down into the high school level because we
all have worked with all the technical programs that are out
there but we need to get more kids interested in coming into
the industry. And somehow, we have to get down to a lower
level, whether it is junior high or high school and get the
school administrators to really be focusing on letting students
and parents know about the great careers that are available.
As I said, a lot of my very skilled technicians make six
figures in the Chicago area. That is a really good wage for no
college debt. And we are just not getting that message across
in that lower levels of education to let people pursue those
kind of careers.
We have a great recruiting for the military as well, kind
of similar to what was just described. I think we have hired
three or four technicians where they work for us for free and
get skills and then they have been fantastic but there are not
enough people coming out of the military to fuel our true
needs. And it is not just construction equipment. It is
automobile technicians, truck technicians and all the other
skilled trades that are out there.
Ms. YOUNG KIM. Well, thank you so much.
My time is up. I yield back. Thank you.
Chairman CROW. Thank you. The gentlelady yields back.
The gentlelady from Kansas, Ms. Davids, who is the
Chairwoman of the Subcommittee on Economic Growth, Tax, and
Capital Access is now recognized for 5 minutes.
Ms. DAVIDS. Thank you, Chairman Crow and Ranking Member
Young Kim for holding this hearing today.
As we have heard in this hearing today and for the last few
years, our small businesses are facing serious challenges,
including workforce challenges that have been brought on by
this pandemic and, you know, what we are doing here is trying
to focus on how we can help folks enter or re-enter the
workforce and get these good-paying jobs we are hearing about.
Community colleges are, of course, a major player in helping
individuals skill and upskill and reskill, especially as it
comes to these highly technical and long-lasting careers. In
fact, in the Kansas 3rd, where I represent, I like to say that
we are kind of a hidden gem of a thriving community college
environment. I mean, I am a little bit biased. I might be
saying that because I am the product and proud alum of Johnson
County Community College. And I have had the chance to work a
lot with the Kansas City, Kansas Community College to secure
funding for an automated robotics lab and program that they
have so that students can train with like real life automation
equipment that is currently being used in the industry. And I
think this is especially relevant given the conversation that
we have been having today.
I am curious, Dr. Brownlee, if you could share a bit about
what successes or maybe even concerns, I am not sure, you have
seen in developing some of the kind of custom curriculum for
specific trades or jobs. And then also, if there is like, what
the mix of the students that are looking at those various
career choices or reskilling. I am just curious about that.
Mr. BROWNLEE. Thank you for the question, Representative
Davids. And I will tell you, we are excited that you are a
proud product of community colleges, especially as we enter
April, Community College Month. That is a great excitement to
us.
But to your question, as we think about essentially in our
service area, our industry partners have been very responsive
in wanting to be at the table. We include industry partners
through advisory councils that help us to shape what are
essentially the learning outcomes that are associated with
these jobs. As you heard one of our fellow, the individuals
giving the testimony talked about how there are technicians
that are needed in these various industries. And so, we work
with our partners to identify what are those learning outcomes.
A bit of the challenge really becomes those very short-term
programs. As we think about funding those programs is where the
true to concern to your question of the challenge comes in is
funding because depending upon the nature and the length of
that academic program or that workforce-related program, we are
talking about social and economic mobility, workforce-driven
programs. So, 3, 4 week, 5 week programs, 9 week programs, this
individual can now take on a new career and pathway and be able
to provide for them and their families in a manner in which
they would not have been able to do previously. However, the
funding becomes a challenge. Based on the length of it, it may
not be funded and carried by the Pell grant, and so that is
where we really need the help and the challenge.
In terms of those that we are seeing engage with these
trainings, everything from the traditional age--I think about
the work that we are doing out of Cherry Creek Schools, the
great work they are doing out of the Cherry Creek Innovation
Center where they are directly tying students into high-wage,
in-demand pathways to work over here at Aurora Public Schools.
So, there are strong partnerships with the traditional age.
The adult working populations are noncredit programs is
where we continue to have opportunity, and to be very honest
with you, it comes down to funding. We need to be able to fund
the very short-term programs. Otherwise, these individuals are
coming out of pocket and they may have the means or may not
have the means. And so hopefully, the conversations that now we
are having and we are seeing some return on, and that is our
industry partner saying, listen, let's sponsor some of these
individuals, especially these adult working learners to be able
to fund them in their education. Creative partnerships.
However, we have to think about sustainability and the
implications if we cannot find a sustainable result.
Ms. DAVIDS. Yeah. Thank you, Dr. Brownlee.
And also, just thank you to our other witnesses for your
testimony.
Mr. Arnold, I am excited and impressed about the training
program that you all have. And Ms. Benck, I really appreciated
your comments about us looking into the younger populations.
Chairman, I will yield back now. Thank you.
Chairman CROW. Thank you. The gentlelady yields back.
I will now recognize the gentleman from Texas, Mr.
Williams, also the Vice Ranking Member of the Committee.
Mr. WILLIAMS. Thank you, Mr. Chairman. And thank you,
Ranking Member Young Kim. And I just want to say in full
disclosure, and especially to Ms. Benck, I am an automobile
dealer. I have been in the automobile business, Chevrolet,
Dodge, Chrysler, Jeep, Ram for 51 years. My family is in it and
my grandchildren are now in it. So, I really enjoyed your
statements. And also, was glad that you mentioned about some of
the Trump tax cuts that we had in 2016--they are still in
force--that have helped make our business pretty good.
You talked about inventory. I normally have 800 units on
the ground. This morning in my car dealerships I have 22. So,
we know about what it has done to our industry. But thank you
for bringing up about the importance of cutting taxes.
With all that being said, the Biden administration
continues to show their lack of understanding for the real
issues American small businesses are facing. Instead of
creating opportunities for all businesses, President Biden is
pushing government mandates that favor big labor and are both
unfair and extremely costly to taxpayers. They just mean more
money. And last month, Biden signed an executive officer
mandating project labor agreements on federal construction
contracts exceeding $35 million, which funnels these critical
government contracts to unions and cuts out other private
companies from being competitive.
A recent report by the Association of Builders and
Contractors stated that 87.3 percent of the U.S. construction
workforce does not--I repeat, does not belong to a union. These
businesses should not be excluded from applying for government
projects because they are not unionized with burdensome fees
and failing pension plans. We should push back on the efforts
to impose restrictive labor requirements on taxpayer funded
construction projects and ensure open, fair, and competitive
bidding for all Americans. And it saves us money by doing that.
So, my question to you, Ms. Benck, you represent the
construction industry. I represent the car industry. Can you
elaborate on how President Biden's executive order will affect
your member companies?
Ms. BENCK. Well, honestly, I work in a very heavily
unionized area. So, the Chicago area, you cannot function
without being in a labor union. So, I do not know if it has
much impact in Illinois. But I think in other parts of the
country, just your 80 percent are not in labor unions, I think
that there is--I do not know if that is the exact number, but I
would not be surprised at that. So, I do think the important
thing here that we get our infrastructure rebuilt and not focus
so much on whether it goes through labor unions. And I am a
supporter of labor unions. Like I said, I have two I am
signatory to here in Chicago. It is just a reality of doing
business up here. But to do things, to make that a requirement
seems to kind of sabotage what we are trying to accomplish in
terms of rebuilding this country's infrastructure for our
future.
Mr. WILLIAMS. I agree with. Picking winners and losers is
not good. Even competition does work.
I have been in the car business for over 50 years as I have
stated and I know firsthand that we are always looking for more
mechanics. We have talked about that. More mechanics, more
technicians and other skilled workers. Our country is facing a
growing skills gap from younger generations that are not
joining the vocational workforce at high enough rates. So,
business owners in all sectors of the economy are in critical
need of workers, especially skilled workers. One way that we
can work to address the skills gap is by informing and
encouraging students to join career technical education
programs. A traditional 4-year college degree is not for
everyone and we found that to be true in this day and time. We
need to ensure students know that there are other high-demand
opportunities that will provide them with a good-paying job and
successful career.
So again, Ms. Benck, you even stated that in your testimony
that a service technician at an equipment dealership can easily
make up to 6 figures, and that is true with my car dealerships.
Providing that vocational program sets students up to learn a
skill which they can master over the years and then hopefully
turn into their own small business like your sone day. The
return on investment for skilled workers is undeniable and it
is critical that we continue to expand and encourage CTE
opportunities.
So quickly, Mr. Arnold, given your background in apprentice
programs, how can we better educate high schoolers who might be
on the fence about paying for a 4-year degree that there are
other opportunities out there and not as costly, and what are
the best practices to recruit more students to put a vocational
option for them in the future?
Mr. ARNOLD. Thank you for the question, Representative.
Very quickly, I think we just need to do a better job of
explaining the benefits to both parents and students so
everybody involved understands about the excellent
opportunities. A lot of times, you know, folks were told they
had to go the traditional career or traditional education path
to be successful and I do not think we did a good enough job
explaining the benefits, explaining the financial burdens. Best
practices, what we have seen starting to work better, is
actually utilizing our current apprentices. The folks in our
program that can relate to the younger populations better than
say myself or folks that have been in the industry for 30 or 40
years. Getting their peers and letting them know exactly what
they are experiencing right now as existing apprentices has
seemed to make a big difference.
Mr. WILLIAMS. Thank you very much.
And Mr. Chairman, I yield my time back.
Chairman CROW. Thank you. The gentleman yields back.
I will now recognize the gentleman from Minnesota, Mr.
Phillips, the Chairman of the Committee on Oversight,
Investigations, and Regulations for 5 minutes.
Mr. PHILLIPS. Thank you, Mr. Chairman, and to all the
witnesses today. I am grateful for your testimony.
Ms. Benck, I want to thank you for your wonderful remarks
about your business and unions. I think that one can be both
pro-business and pro-worker. And I think your remarks are
wonderful and I encourage every business in this country to
follow suit.
When I am back in the district, I have been doing a program
called At Work with Dean where I spend about 3 hours, do a 3-
hour shift at various small businesses in my district. And
without exception, all are saying that business is improving,
very strong in most cases. And all are also saying that the
attraction and retention of employees is terribly difficult.
So, I think we are all in agreement on that.
Starting with you, Ms. Benck, we hear a lot of reasons why
people have left the workforce. I would love to hear from each
of our witnesses about why you think that is the case. Starting
with you, Ms. Benck. What is keeping people out of the
workforce based on your experience?
Ms. BENCK. Well, I think maybe we are a little bit
different than--first of all, we were essential workers so we
never stopped working. We have had may be little higher
attrition rates but not compared to other businesses. And part
of it is because we are high paying wages here. We are not, you
know, hospitality or people, you know, making $10-12 an hour
where I think you are getting a lot more turnover. And I would
say I think that what I have seen in our people is that they
are just a little bit more sole searching. Do I really want to
do this the rest of my life? Do I really want to be a
technician? Do I want to live somewhere else in the country?
Illinois has a lot of issues and we have had just two
technicians resign in the last couple of weeks who want to move
down to more southern states with lower tax rates. And lower
real estate taxes. So, like I said, I do not think our
resignation rates have been as significant as other industries
but it is still certainly an issue for us.
Mr. PHILLIPS. And do you have any belief that perhaps
childcare or immigration reform could provide a boost to the
labor force?
Ms. BENCK. Oh, absolutely. I think we need more
immigration, and if we could get young people who are coming
into this country and start to get them trained as technicians,
they do a great job. I know of some dealers who have flown to
the Philippines and brought a whole plane full of technicians
back. That was in Canada. I do not think we have that policy
here in the United States to allow that to happen. But that is
what this country is, is a whole bunch of immigrants. And I
certainly would hope that we can bring more people in that
would help with the skills gap problem that we are having.
Mr. PHILLIPS. Thank you. I wholeheartedly agree.
Dr. Brownlee, any thoughts from your perspective about what
is keeping people out of the workforce and how we might rectify
it?
Mr. BROWNLEE. Thank you so much for that question,
Representative Phillips. What I would say is that as we think
about, again, the apprenticeships, the internships of small
business owners, really looking to revolutionize what we have
looked at in terms of opportunities previously and asking the
question what brings about relevance and messaging and
opportunity now for our students? And so, I think the creation
of new opportunities. We were talking with industry partners
just a few weeks ago. Relooking at these job descriptions. What
can we do to create some transferrable skill opportunities
where we can retool and upskill and create more? Certainly,
there are challenges with transportation, childcare. You
mentioned it, Representative, and thank you for acknowledging
that. And just what have been challenges of the low
socioeconomic communities continue. But we are committed, and
we are grateful for the funding that we have been able to
receive through the various grants, Department of Education,
you name it. Even here in the State of Colorado through our CoC
programs to create more opportunity and close gaps. What has
been a challenge for folks in terms of funding their higher
education.
Mr. PHILLIPS. Thank you, sir. I appreciate it.
Mr. Kane, your thoughts on what is keeping folks out of the
workforce and what we might do to rectify it.
Mr. KANE. Thank you, Representative. Look, I think the
challenge is some of these are new issues at play but also
enduring issues. And so, there are significant replacement
needs across, in particular, the infrastructure sector. There
is a silver tsunami hitting a lot of these positions. That has
been true for a very, very long time. And the sector is very
traditional in good ways and bad where there is an overemphasis
on service provision, and often an underemphasis on who are
going to be those future workers that are going to take on
these roles? Even in the capital planning process for these
different agencies. You know, workers are kind of a second
concern I would argue compared to some of the physical
upgrades. And so, understanding that there needs to be more
flexibility and visibility as I said before, and particularly
for younger workers, younger students. I appreciate what was
reflected in some of the other testimony on that. But there
need to be mentorships, knowledge transfer as this older
generation transitions out, that the younger generation
actually can take on and understand what the nature of the work
is and not just a simple credential in isolation but actually a
pathway where they can grow and learn.
Mr. PHILLIPS. I see we are out of time, Mr. Kane. I was
hoping to get to you, Mr. Arnold, but perhaps next time.
I yield back. Thanks.
Chairman CROW. The gentleman yields back.
I will now recognize the gentleman from Mr. New York, Mr.
Garbarino, for 5 minutes.
Mr. GARBARINO. Thank you, Chairman. And thank you to the
Ranking Member for hosting this hearing.
I have a question. I will start with Ms. Benck and maybe
Mr. Arnold can add in to it. Ms. Benck, you run your own
business. And something I heard from my electrical contractors,
I had a meeting with them yesterday, and they talked about a
lot of the women and minority-owned businesses. And they said
that right now under the SBA--the federal government under the
SBA size standards set forth in their regulations that they
used a gross revenue standard when determining whether a woman
or minority-owned business can participate in these SBA
programs. And since it is gross, are you concerned that using
that current standard and not updating it based on increased
cost of goods, increased cost of doing business that certain
businesses like yours or others might get knocked out of the
program prematurely just because of the way inflation is?
Ms. BENCK. I do not know exactly what the SBA standards
are. I certainly am very familiar with like the State of
Illinois and City of Chicago, State of Indiana standards. I
would think that they run pretty similar. But I think one of
the really big problems of those programs is that you graduate
too quickly. The reality is there is still a lack of MB, WB
businesses out there to do construction work. And all the
states are putting in higher and higher percentages that that
work needs to be subcontracted. And there is just not enough
skilled people out there. I would much prefer to see some more
criteria put in as far as the number of minorities or women in
the workforce working on a particular job to me would raise it
better than selecting one specific customer or owner of a
company would be more effective. And also, what we have seen
over and over again is you get a very qualified minority
contractor and then everybody floods to them because they do a
good job. They get too big. They graduate out of the program.
Mr. GARBARINO. They hit a certain revenue standard and they
get graduated out?
Ms. BENCK. Yep.
Mr. GARBARINO. And then you are all stuck in the same
position as you just were.
Ms. BENCK. Yeah. And I know there has been discussion in
the State of Illinois of even taking those standards completely
off. Where that is right now I do not know but definitely for
construction jobs I think, you know, a lot of times it is
around $30 million is pretty darn small. I mean, it costs a lot
to do any kind of road construction or trucking or whatever it
is. That is pretty small.
Mr. GARBARINO. No, absolutely. I know the same thing in my
state of New York. A lot of projects cost that much.
Mr. Arnold, I am not sure, have you heard anything similar
in Colorado with some of your contractors? I know you probably
work very closely with them since you have the program that you
currently run.
Mr. ARNOLD. Thank you, Representative. My experience really
has been more that the city and county of Denver has similar
program requirements and there is a lot of work going on at
Denver International Airport. It is a concern because it is
based off gross revenue. The cost of materials has gone up
significantly and I think labor costs will follow suit as you
try to backfill the labor needs. And so, I think it is worth
taking a hard look at it. It makes sense on the surface. You
know, your gross revenue should be a reflect of what type of
profit margin that you make at the end of the project. With the
increase on the goods, if you look at a Chiller or whatever
piece of equipment that you are buying, materials, because they
have increased so much and we still want to serve our
customers, I think the contractors are sharpening up the
pencils. And so that might mean that those profit margins are a
little bit thinner than they were in the past just to make sure
that the project goes forward, everything stays on budget. And
so, it is more of an examination and making sure that we are
not graduating those women and minority-owned contractors too
quickly because they need that support to really flourish long
term.
Mr. GARBARINO. You touched a point that I was going to get
to next. Can you talk about how much materials have gone up and
what that is doing to the contractors that you work with?
Mr. ARNOLD. So right now we have not seen an effect on it
as far as projects being delayed or canceled but the material
costs have increased significantly. I attended strategic
planning sessions with our contractors actually this week,
Monday and Tuesday, and that was a large topic of discussion
and whether or not they were seeing actual projects delayed or
canceled. Things are long lead items right now and we have just
seen huge increases on just the raw materials that it takes to
build these kinds of projects out. I had a contractor tell me
that they are looking at 60 weeks lead on some of the equipment
that they need for projects. So, it is going to be a challenge
I think coming up here in the near future.
Mr. GARBARINO. I appreciate the answer.
I am out of time so I yield back. Thank you, Mr. Chairman.
Chairman CROW. Thank you. The gentleman yields back.
I now recognize the gentlelady from New York, Ms. Tenney,
for 5 minutes.
Ms. TENNEY. Thank you, Chairman Crow and Ranking Member
Young Kim, for holding this hearing today.
We hear a lot about the labor shortage facing our economy.
Businesses of all sizes, including my business which is less
than 100 employees. But we have been around for 76 years and we
are experiencing a real problem with getting workers. We are
trying to advertise. We are doing extra incentives that we have
not had to do in the past in order to deal with the labor
shortage that we have. We are offering higher wages, expanded
incentives as I said. And this is happening not in just the
southern tier and Central New York, but it really happening all
over our state as well. And probably all over the country.
As we know, this is a tight labor market. So, as the demand
for goods and services increases, so does the price. And so now
we are seeing higher prices and the cost of wages is rising.
Americans are receiving more money for their work which is a
good thing, but this creates this tension between the employers
who obviously we like to see a labor market where we can get
more employees at a lower rate, but at the same time, we love
to pay our employees more because if we can charge more for our
services, but with inflation affecting us this has been a
problem.
But I think government can respond to this. And I think one
of the things that we are seeing, and this is particularly
true, is some de-industrialized areas, we are seeing just an
influx of supply of a cheap foreign labor that are often,
especially in the tech industry, and they are getting some of
the benefits here that a lot of our American companies are not.
And I think this creates a disincentive for employers to really
invest in their workers and invest in the technologies and the
processes in the long-term growth that we need to bring
American workers back into the workforce. And so, we have seen
a lot of American workers kind of pushed to the sidelines, many
of them with skills that could be trailed but moving
unfortunately, maybe the lower skilled jobs are even choosing,
unfortunately, not to do some of the jobs that we need them to
do or we could train them to do if we had a focus on the
American labor market. And also, on dealing with this issue.
And I think it is really important on the Small Business
Committee that we are fighting for our small business
community. And especially, the employees of the small business
community because they are the heart of our businesses. They
are the people that make us grow. And in my business they are
part of our family. I mean, it is almost every year that we
give out a 50-year pin to someone who has worked in our
business way back when my grandfather hired them.
But to that, one of the things that I think has been really
helpful for us, and this is why I want to direct a question to
Ms. Benck and also to Mr. Brownlee from Aurora, we have
wonderful community colleges in Upstate New York and they have
been providing us with an opportunity to train a lot of our
workforce. And this has been a great situation. But in terms of
job training, increased wages and benefits and really focusing
on a renewed commitment to America workers and our communities,
I think that is what we need to start looking at.
And I wanted to again address my first question to Ms.
Benck. You raised the unfortunate issue of stigmas against
skilled trade in our country and this has been a barrier to
entry particularly for young people into stable, well-paying,
long-term jobs. How, in your opinion, does the frequent lack of
career and technical training in America's secondary schools
contribute to this phenomenon? If you could just give us a
brief, kind of restating what you have said in the past.
Ms. BENCK. Well, I think it is a huge source of the
problem. I mean, it used to be when I was in high school, you
know, there was always a shop class; right? And those are gone
out of most high schools. So that is where AEDs putting their
efforts now into reaching back into those high schools that are
still focusing on technical trades and we are out there
certifying them and organizing all the dealers in that specific
area to get involved and active so that we get those young
people interested in our profession. And I think the high
schools need to do a much better job. And it is not really just
even the educational process. It is really the parents that are
a big problem. We have this view in this country that everybody
has got to go to college and if you do not send your kids to
college you are doing them a disservice. And unfortunately, I
think that has led to all of these very sometimes much higher
paying jobs with no debt.
We have a little graph that we use at AED. It is based on
averages. But it is literally like over $300,000 for the first
4 years of a young person's life difference in cost of going to
college and going into debt versus going into one of our
technician programs where you get paid going along the way and
you get out 2 years earlier earning in a job. Three hundred
thousand dollars in the first 4 years of someone's life is
absolutely enormous in terms of their total economic future.
Ms. TENNEY. We could do a month on school loans and debt. I
hear about it a lot from students. But I urge them, as you
said, you have got a lot of trucks in the background in your
screen there and we are having a struggle getting a lot of
people to become truckers which is a great, well-paying job
that is so necessary. And we have had to employ some of our own
people.
I just want to say, what do you think Congress----
Chairman CROW. The gentlelady's time has expired.
Ms. TENNEY. That went quick. Thanks so much. I appreciate
it. I will catch up with you in the next round.
Chairman CROW. Thank you.
So, we will start, while we are waiting on Ms. Houlahan
from Pennsylvania who is on her way to the hearing, I wanted to
do a follow up with Mr. Brownlee, Dr. Brownlee.
A little bit more on the students that you serve in Aurora,
some of those or many of those are underserved students. Can
you touch briefly on the impacts of transportation challenges
and childcare challenges that those students face when they are
pursuing training, vocational, technical training at the
Community College of Aurora?
Mr. BROWNLEE. Absolutely, Chair. Thank you, Chairman Crow
for the opportunity.
So, yes, as I shared earlier, 51 percent of our students
are Pell grant eligible and so as we think about low
socioeconomic communities, over 90 countries represented here
at the Community College of Aurora so as we think about
childcare, just as, for example, 60 percent of our students are
female, so we think about the amount of working mothers that we
have here at the Community College of Aurora, it tends to be a
bit of a challenge and a barrier for childcare, just available
childcare. As we think about our service area and the various
challenges there are in some cases a 1 to 2 year waiting list
just for individuals to be able to secure childcare for
themselves. And then that certainly becomes a barrier.
And so, as we think about transportation, broadband access,
as we have been working through the pandemic, it is one thing
to hand a student a laptop. It is a whole another thing to make
an assumption that that student has a home to plug that laptop
into, let alone has access, Internet access in their own
private homes to do the work of online education. And so, we
are seeking and have continued to find ways to have gap
closures as we think about the digital divide and providing Wi-
Fi access. We certainly increased our infrastructure here at
the college at our locations. I have created Wi-Fi accessible
parking lots to create more access opportunities for our
students. But certainly, certainly, certainly it has been a
challenge in our community to be able to meet the needs, create
workforce opportunities, and you are having to deal with just
basic food insecurities, housing insecurities, and the various
challenges that come about with low socioeconomic communities.
I say that to all say, we also are grateful though for all
the opportunities that have been provided from us from the U.S.
Department of Education and the U.S. Department of Labor, and
certainly here in the State of Colorado, to help us address
these various challenges for our students.
Chairman CROW. Thank you, Dr. Brownlee.
I will now recognize the Ranking Member, Ms. Young Kim, for
5 minutes.
Ms. YOUNG KIM. Sure. Thank you, Chairman.
And to our witnesses, as we continue to discuss the
shortage in skilled workforce and the need to bring in more
qualified individuals to work, could you, specifically Mr.
Arnold and Ms. Benck in your respective industries that you are
in, can you talk about some of the technical skills and
qualifications you are looking for in an employee and whether
or not you anticipate those skills will be changing in the next
5 to 10 years?
Ms. BENCK. Well, I guess I will go first. Oh, my God, the
skill levels that we are going to need in the future is a
little bit frightening when we look out 5 years from today. I
mean, we are on the verge of autonomous tractors. We have all
the new fuel technologies that are coming, electrification,
hydrogen, all kinds of things that the manufacturers are
working on today. So, the skill level, like I said, right now
our technicians really have a bachelor's degree in terms of the
time that is put into their training, whether it be from that
2-year technical program, and then what we do as a dealership.
But the skill levels and the different skills that are going to
be needed in the future are a little bit frightening and will
create a whole bunch of other challenges as we move into the
future.
Ms. YOUNG KIM. Mr. Arnold? Mr. Arnold?
Mr. ARNOLD. Thank you, Ranking Member Young Kim.
The nice part I think right now is for somebody just
looking to enter into the apprenticeship program, all we really
need is somebody that has the good enough soft skills. A
willingness to show up to work, to be there on time, to work
throughout their entire shift, be productive, and learn from
their mistakes. The training program really is designed and
engineered to make sure that at the completion of the 5-year
program obtain all the certifications required to be successful
in the career. So, during that program they are going to obtain
welding certifications. Up front it is a big focus on safety,
so they are going to need OSHA 30-hour Safe Handling
Refrigerants. And then all the various certifications that go
along that is needed by the industry, by our employers that
communicate that to us at our monthly JATC meetings.
I would agree with Ms. Benck that the future is going to
involve some changes and we are going to need to train folks on
newer technologies. Right now, we are focusing on making sure
our members are trained on variable refrigerant flow, variable
refrigerant volume systems which just were not all that common
in the past. Typically, you saw large scale hydronic systems
with traditional boilers and chillers. And so, some of that
technology is already starting to show itself and we have
already engaged in that training. But where does hydrogen lead
for building heat and in-home heating? Geothermal is another
viable technology that I could see used in the future. And so,
what we want to do is continue to maintain that constant
communication with our employers so they can communicate
exactly what our customers are looking for. What do building
owners want in their new buildings? And that way we can adjust
and be flexible to meet the industry needs.
Ms. YOUNG KIM. Thank you. It looks like Ms. Houlahan showed
up so I will yield my time.
Chairman CROW. Thank you. The gentlelady yields back.
I will now recognize the gentlelady from Pennsylvania, Ms.
Houlahan, for 5 minutes.
Ms. HOULAHAN. Thank you. And apologies for being so late.
I appreciate the time of all of you all, and I appreciate
all of your testimonies today. And my questions are focusing on
two areas. One is on workforce development in the STEM area.
And I want to thank you as I mentioned for each of your
testimonies in this area. We need to very much swiftly address
the workforce issues that we are having, particularly in STEM
and STEAM. I am an engineer and so, of course, particularly
interested in these issues. And in specifically addressing the
lack of gender diversity in these fields.
So, one particularly important consideration is that which
women experience, and they experience significant challenges in
returning to the workforce after major life events. So, one in
four women tend to take a break in their career which is four
times as many women as men, and many of those women drop out of
the workforce as a result of that break in their career.
So, to Mr. Kane, in your testimony you emphasizer the need
for federal leadership to ensure greater flexibility to fill
careers. Would you be able to please elaborate on how providing
funding for flexible workforce development opportunities, such
as returnships that would be created by the STEM Restart Act
would help address the workforce development and diversity
challenges that our country faces?
Mr. KANE. Yeah, Representative. You know, look, I think the
reality we are facing is startling where I think Mr. Brownlee
said that 60 percent of the candidates I think in his program,
are about 60 percent women. In our research, under 15 percent
of infrastructure workers are women. And so, there are huge
gaps here even for individuals who may get some of the
credentials to actually holding on to and filling these
positions over time. And so, to the extent that there is direct
employer engagement, supportive services as has already been
talked about in terms of childcare, travel assistance and so
on, that is very important for women I would argue in
particular here. But I think flexibility also to the
understanding as it relates to the skills conversation, you
know, we cannot just be looking at filling one type of job or
one position but really revealing I think the pathways that can
be quite nimble for prospective workers, whether you are a
woman, a person of color, or so on. We need the 100 to 200
level skills here, too, that workers, particularly as it
relates to STEM, we found in our past research that STEM skills
are crucial, whether you are a water treatment operator,
whether you are a technician, whether you are an electrician.
These are common skills across so many of these different
occupations. And yet, the employers often are planning an
isolation; right? They are often competing against each other.
And from the worker's standpoint, they do not know, at least
from the research I have done, they do not know where to turn
other than that they are told to kind of train for one
particular job with one employer. And that is just not the
reality that is facing a lot of workers now. And so,
understanding how more and different types of women, including
women, can achieve those 100 to 200 level skills is crucial. We
have seen some innovative efforts across the country that have
tried to do this. The Infrastructure Academy concept is one
idea that has emerged in D.C. and also in Los Angeles on this
issue of creating a one-stop destination for workers,
prospective workers, for the younger workers, to actually
understand what the opportunities are and the skillsets that
are needed, not just the individual credentials to fill these
positions.
Ms. HOULAHAN. Thank you. And I look forward to following up
with you on Infrastructure Academy. The Infrastructure Academy
conversation because my follow-on question was going to be what
can we be doing to be more helpful, and what can the SBA be
doing as well?
With what remains of my time, I want to transition over to
stakeholder capitalism. I Co-Chair the Stakeholder Capitalism
Caucus with my friend and Representative Dean Phillips. And we
are trying to understand how businesses can better impact
policies to foster inclusion and generate longer lasting growth
that benefits all stakeholders rather than just exclusively the
shareholders. We believe that smarter business practices, such
as providing workforce development and career advancement, will
be able to grow businesses as well as grow people.
So, to all of you with the 47 seconds I have left, can any
of you speak to the importance of providing workforce
development opportunities not only for the benefits of the
individual but for the benefit of the businesses at large?
Perhaps Mr. Brownlee.
Mr. BROWNLEE. Thank you very much, Representative.
I would say that stackable credentials now more than ever
are critical as we think about the advancements in workforce
development and training, we want to create very short-term
programs that can meet the needs of small businesses as quickly
as possible and create what can be a career growth trajectory
for those individuals towards increased opportunities for
economic mobility for them and their families. So, I would say
stackable credentials, very short-term credentials, and
including very dynamic programs that infuse industry
experiences working with the likes of Mr. Arnold and Ms. Benck
to create these real-life experiences for students in the
classroom is critical.
Ms. HOULAHAN. I appreciate you all. It appears as though I
have run out of time and I yield back.
Chairman CROW. Thank you. The gentlelady yields back.
I want to thank all of our witnesses again for being here
today. The current labor shortage is a top concern for American
small businesses. A business cannot thrive without properly
skilled workers. A drag on small businesses hinders our entire
economy. Workforce development can expand the pool of qualified
candidates, helping small firms fill their openings and grow
their businesses. In turn, we can supply workers with the tools
they need to get good paying jobs and help them support their
families. So, by prioritizing workforce development, we can
bolster small businesses, help American workers, and support
communities.
And I also just wanted to make an additional comment on the
discussion that we had with Dr. Brownlee and the impact of
affordable quality childcare on our workforce. One of the
largest periods of economic expansion in our nation's history
was after World War II is large numbers of new workers entered
our workforce. They were largely women. Right now, we have
millions of American workers who cannot enter the workforce or
cannot enter the workforce at the right level because they
cannot afford to or they just cannot because they do not have
childcare for their children. And the bottom line is this
actually disproportionately impacts women. That is what the
data show.
So, if we want to unleash vast swaths of economic activity
and grow our economy and help our businesses we will pass
legislation that will provide quality, affordable childcare to
American families. That is good for our economy. It is good for
our families.
So, without objection, Members have 5 legislative days to
submit statements and supporting materials for the record.
And if there is no further business to come before the
Committee, without objection, we are adjourned.
[Whereupon, at 11:29 a.m., the subcommittee was adjourned.]
A P P E N D I X
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
[all]