New Report Details Massive Federal Funding Gap For Workforce Prep Compared To Degree Programs Despite Persistent Labor Needs

Eighty Percent of Federal Postsecondary Education Funds Go to Degree Programs that Only 38 Percent of Americans Complete, While Construction and other In-Demand Sectors Struggle to Find Qualified Workers

Only one-fifth of federal investments in postsecondary education support workforce development for fields like construction and manufacturing, while the rest of the money goes to “traditional” degree programs according to a new report on federal workforce funding levels released today. The report, which was produced by the Progressive Policy Institute, the Associated General Contractors of America and Procore, notes that this funding gap is making it hard for many employers to find qualified workers to hire.

“If the U.S. does not act now to ensure the nation’s workforce is prepared for open job opportunities, more Americans will be unqualified for work and employers will continue to struggle to find talent and remain competitive,” the report notes. “Yet policymakers continue to undervalue the importance of workforce development and instead prioritize investments in degree programs that often aren’t needed to get a good job.”

The report, titled Building a Stronger Workforce: Federal Spending on Postsecondary Education and Training, notes that of the $139.5 billion the federal government spends annually on postsecondary education, only $28.2 billion goes to workforce education and training programs. The other $111.3 billion supports “traditional” degree programs that only 38 percent of Americans complete.

The funding gap is making it hard for employers in fields like construction and manufacturing, which typically require specific training not offered by traditional degree programs, to find enough qualified workers to keep pace with demand. The report notes that the Bureau of Labor Statistics shows the construction industry alone has over 407,000 unfilled position and that figure is expected to continue growing. Meanwhile, 88 percent of construction firms report having a hard time finding workers to hire.

Included in the new report are recommendations on how federal policy makers can help address workforce shortages for in-demand industries. Those recommendations include increasing federal investments in workforce development, including doubling the amount of money for Perkins and other career and technical programs.

The report also recommends new investments in faster and more flexible training programs like Virginia’s FastForward program. The report urges new incentives to encourage employer-centered workforce education and training partnerships. And it cites several promising state-based workforce development programs, including the Virginia one, as well as programs in Indiana, Pennsylvania, and Colorado.

The groups released the report during an event this morning at the U.S. Capitol complex that featured comments from congressional officials, the report’s authors, a construction general contractor and a community college administrator. The panelists talked about the challenges posed by the current federal funding levels and urged policy makers to help. The report is available here.