Viewpoint: Corbett's proposed budget offers good start for discussion

by Edward J. McCann Jr.

The summary accompanying Gov. Tom Corbett?s 2012 budget message described his broad-based collection of initiatives under the title JOBSFirst PA as ?a comprehensive road map to economic recovery in PA.?

Let?s see where the road map points.

JOBSFirst PA calls for the creation of a Governor?s Advisory Council on Privatization and Innovation to infuse state government with a culture more like the private sector. JOBSFirst also would create an Interagency Coordination Advisory Group to focus on ?big picture, cross-agency? issues affecting economic development. It also would create the Liberty Financing Authority, envisioned as a one-stop shop for business financing that would integrate current Department of Community and Economic Development loan programs and potentially streamline processes for applicants and create more flexible financing tools.

JOBSFirst also offers tax relief and incentives, such as the continuing phaseout of the Capital Stock and Franchise Tax and tax credits for research and development, film production and job creation.

The budget also promises development of critical transportation infrastructure, although as a separate item, and enhanced support of entrepreneurship and innovation.

All this is combined with two principal work-force development strategies: a comprehensive job-matching system and the Keystone Works initiative to encourage commonwealth employers to match unemployment compensation support with on-the-job training for unemployed workers.

Pennsylvania?s CareerLinks, the state?s brand-name one-stop work-force centers, have had a technology-based job-matching system, known as the Commonwealth Workforce Development System, or CWDS, for some time. It was developed, at considerable cost, during the Rendell administration. The new proposal would improve the system through additional technology support and better management of information. The anticipated benefits would be greater understanding of the skills and competencies of unemployed workers and the ability to better match skills with employers need. Details of the plan are not available yet, but work-force development practitioners are generally supportive of the effort, given the expertise of Department of Labor & Industry?s Center for Workforce Information and Analysis, which would have more responsibility for implementation.

Those familiar with the current CWDS system concede that it is less user-friendly than commercial job boards, mainly because it must simultaneously provide both the labor exchange function and the complex accountability and demographic reporting requirements of federal and state funding sources, a burden private systems don?t bear. The extent to which the new system could compensate for that burden remains to be seen.

The Keystone Works program also could be promising. It would allow unemployment compensation claimants to collect benefits while participating in on-the-job training by employers, with the companies receiving up to $1,500 in state incentive payments over the course of training. This would be a different approach to traditional U. S. Department of Labor job-training programs, which work on a ?hire first? basis and pay a wage during training instead of unemployment benefits.

The budget message is the beginning of the conversation, not the end. Both the business and economic-development communities would welcome the continuing phaseout of the Capital Stock and Franchise Tax (see ?Cover Story,? page 10) and any real streamlining of DCED?s loan programs. As details emerge on the work-force development system changes, we?ll have a better picture of whether job matching is improved or employers embrace the training incentives.

Infrastructure investment may well be the No. 1 action the commonwealth can take to spur economic competitiveness and job creation, but finding agreement on how to pay for it may still be difficult.

On balance, however, Gov. Corbett?s message is a good starting point.

Edward J. McCann Jr. is chief operating officer of the Berks County Workforce Investment Board.

Source: http://businessweekly.readingeagle.com/?p=2186&utm_source=rss&utm_medium=rss&utm_campaign=viewpoint-corbett%25e2%2580%2599s-proposed-budget-offers-good-start-for-discussion

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