Unemployed Ohioans in need of job training and industry certifications would be eligible for state loans under a bill being introduced in the state Senate.
Dayton-area Sen. Bill Beagle, who is leading the effort, said a new, revolving loan program would lend money to people enrolling in training programs or work-specific courses at a community college or university. Loan program participants would have a grace period from repayments for a few months to allow time to find a job.
Senate President Keith Faber, R-Celina, said the job training proposal is a priority in the Senate, and one of its top 10 bills for 2013.
Beagle, R-Tipp City, said eligible programs and courses would be decided by what jobs are in demand in Ohio, noting that some training programs can take several months to complete.
“The idea is the training is funded when we know there’s a demand for the skill,” Beagle said.
If the bill passes, the state would fund the initial seed money and loan repayments would fund additional loans. Beagle said details of the plan still need to be worked out, such as which agency runs the program and how the loans are repaid.
Beagle said he doesn’t want the program to be a burden on recipients.
“We know student loans are an issue and we don’t want to add to that problem,” Beagle said.
Scott Koorndyk of the Dayton Development Coalition said Miami Valley companies have a need for programs that target the unemployed.
“Some workers can very quickly transfer knowledge and skills through a training program,” Koorndyk said.
Koorndyk said workers laid off during the recent recession often acquired most of their skills on the job. He hopes new programs include industry certifications, which unemployed or current workers already have the knowledge to easily complete.
“When a person who’s been in a position for a number of years loses a job, they’ve got skills but they got those skills as a part of learning their job,” Koorndyk said.
Companies could pitch in for part of the repayment as part of a job offer, Beagle suggested, adding a private partnership similar to the Ohio Incumbent Workforce Training Voucher Program. The program targets high-growth industries and reimburses companies for half the cost (up to $4,000) to train a current employee in a new skill. The rest must be paid with private funds.
The money can be used for a variety of options approved by the employer, for example:
* completion of an industry-recognized certificate;
* upgrading computer skills
* training provided for a new piece of equipment.
Beagle said the loan and voucher programs could work hand-in-hand: Companies who move up workers trained with voucher money could hire a loan recipient for the entry level position vacated by the promoted worker.
“I can see this being attractive to manufacturers as they expand, get busier and use new equipment,” Beagle said.
In a 2011 Manufacturing Institute survey, 74 percent of manufacturing companies indicated shortages or skills deficiencies in production jobs hurt their ability to expand or improve productivity.
The need for higher skills training became clear last week, when more than 450 companies applied for state vouchers to train more than 28,000 employees.
Applications are funded on a first-come, first-served basis and there’s not enough money to fund every one. Gov. John Kasich set aside $20 million for the 2012 fiscal year and $30 million for 2013 for the program from casino fees, which only became available at the end of 2012.
Beagle said the loan program could be funded at the same level with casino fee money.
Individual loans are one idea to improve Ohio’s workforce, Beagle said, and might be part of a larger workforce development bill. Legislation would be vetted by the newly created Senate workforce and economic development committee that Beagle chairs.
Kasich established a workforce development board composed of business and education leaders across the state. Senate President Faber said the Senate committee will work in tandem with Kasich’s group to develop workforce programs that train the next generation for jobs in Ohio.
“Most programs are targeting the unemployed,” Faber said. “There are fewer programs that train the underemployed.”