Richmond Times-Dispatch: Mayor Kenneth Cooper Alexander: Commentary: Let education savings plans follow the demand – for skilled labor

RICHMOND TIMES-DISPATCH, MAYOR KENNETH COOPER ALEXANDER

eefing up our nation’s capacity to produce certified skilled employees is vital for so many career fields, as well as for our economy and for the safety of consumers. It is also a matter of equity for future and current workers who seek career training but do not enroll in traditional colleges and universities.

That’s why Congress must pass the bipartisan Freedom to Invest in Tomorrow’s Workforce Act, cosponsored by two Virginians, U.S. Reps. Abigail Spanberger, D-7th, and Rob Wittman, R-1st. The bill has been assigned to the House Ways and Means Committee.

The Freedom to Invest in Tomorrow’s Workforce Act would bring greater flexibility in how tax-advantaged education savings plans, known as 529 accounts, can help students and adult career-changers. Under current law, people can save money in 529 accounts and withdraw their funds tax-free for certain educational expenses. The catch is that the money must be spent on universities and other traditional institutions of higher education; state-supported community colleges; vocational, private or religious K-12 schools; and registered apprenticeship programs.

This restriction is unfair to people who want to prepare themselves for good-paying, high-demand jobs that do not require a university education or further training to change careers.

Making 529 education savings plans more flexible would also help the many industries and career fields that increasingly need certified workers with 21st-century technology skills, who can obtain the necessary licenses and credentials and will be entrusted with the safety and health of consumers.

What types of jobs?

Examples include aviation maintenance technicians, welders, certified nursing assistants, medical coders, pharmacy technicians, jobs in the trucking industry, many occupations in information technology along with technicians skilled in installing and servicing heating, ventilation and air-conditioning systems.

in many ways, these and other mid-skill workers make up an important underpinning of our economy. Think about this: Every aircraft must be serviced and prepared for flight by certified aircraft and power plant aviation-maintenance technicians. In addition, the Boeing company forecasts that 610,000 new technicians will be needed to maintain the global commercial fleet over the next 20 years.

Meeting the demand for these skilled workers will require collaboration between public and private entities, greater investment in training and recruitment, innovations and adaptions in career education, and flexibility in tax laws, including for 529 savings plans.

But failure to keep up with projected demand for certified skilled aviation maintenance technicians may mean significant disruption to the international transportation network and negative consequences for our economy.

There are similar concerns in other skilled career fields. For instance, 450,000 welders will be needed by 2029, according to the U.S. Bureau of Labor Statistics, while the U.S. Department of Health and Human Services projects demand for more than 3.6 million registered nurses by 2030.

Labor shortages are already a problem for our economy, especially when it comes to skilled trades. There are 9.93 million job openings in the United States, including 321,000 in Virginia.

Private career and trade schools are instrumental in keeping the pipeline of skilled employees flowing into high-demand jobs — but they can do more if students can tap into tax-advantaged 529 education savings plans.

Preparing skilled employees for essential jobs in the 21st century is only part of the story. These workers also help maintain middle-income and community stability at the local and regional level. That’s because trade schools are based in communities, and their graduates often stay in their hometowns.

So, as a skilled graduate obtains a good-paying job, he or she develops a more solid footing in the local economy, spending money at local businesses, becoming a potential homeowner and gaining the financial security to participate in civic affairs. In effect, they help renew the middle-class backbone that our nation has relied upon for generations.

Adding more flexibility to 529 education savings plans helps us build and sustain the middle class without requiring everyone to get a four-year college degree. So, it is imperative to align more financial resources, including 529 education savings plans, with the critical demand for a skilled workforce.

The Freedom to Invest in Tomorrow’s Workforce Act makes for good commonsense public policy in so many ways. Let’s work to make sure it becomes law.

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