1. Worker Training Tax Credit: Promoting Employer Investments in the Workforce
- Author:
- Alastair Fitzpayne and Ethan Pollack
- Publication Date:
- 08-2018
- Content Type:
- Working Paper
- Institution:
- Aspen Institute
- Abstract:
- Rapid advances in technology, including artificial intelligence and automation, are transforming industries and reshaping the skills necessary to secure and keep a job. In response, U.S. workers will need to acquire skills that are not easily automated or that complement ever-changing technology. Yet, data suggest an alarming trend: there is a steady decline in the amount employers are investing in their workforce.[1] Federal and state policymakers should consider using tax incentives to encourage additional workforce training investments. To accomplish this, in May 2017 the Future of Work Initiative proposed the Worker Training Tax Credit. Modeled on the popular Research and Development (R&D) Tax Credit, this new tax credit could be used by small and large businesses to invest in training for their low- and middle-income workers. Based on economic modeling recently conducted by District Economics Group, the Worker Training Tax Credit would cost roughly $146.5 million over ten years, and lead businesses to increase training investments by 8.5 percent. Because the tax credit excludes training provided to high-income workers, these induced training investments would provide greater opportunity to low- and middle-income workers.
- Topic:
- Science and Technology, Employment, Tax Systems, Artificial Intelligence, and Skilled Labor
- Political Geography:
- North America and United States of America