La. training program looks to fast-track labor force

The Louisiana Department of Labor is hoping that a new program will help to combat the labor shortage currently afflicting Louisiana business and industry.

Beginning Aug. 15, the department will use 10 percent of its annual Incumbent Worker Training Program appropriations to fund a pre-employment training program.

The state labor department uses the IWTP to pay for businesses in the state to enhance their existing employees’ work skills, and to train workers for other employment within the company.

Businesses contract with a training provider to supply the employee training. Through the IWTP, the state reimburses businesses for the cost of the training.

The pre-employment training program was formerly administered within the Louisiana Department of Economic Development, but the shortage of workers in the state prompted its placement within the Department of Labor.

Instead of existing workers, the pre-employment training program focuses on a business’ potential hires. Like the IWTP, companies contract with a training provider to work with a likely employee.

However, the pre-employment training program differs from the IWTP in that companies match 50 percent of the money the state pays for the training.

Also, businesses are expected to hire a fixed proportion of the workers they train through the pre-employment training program, though the Department of Labor has not yet established the ratio.

The department moved the pre-employment training program into the IWTP because many Louisianans “don’t have basic fundamental skills to start a job,” said IWTP Director Michael Harris. “Employers” asked us to “just get them in the door,” he said. “The goal is to get them a job.”

Workers train for 60 to 120 days in the pre-employment training program.

The labor department funds the IWTP through Unemployment Insurance taxes businesses in Louisiana pay to the state.

The IWTP has $4.7 million available in pre-employment training funds.

Speaking at a Thibodaux Chamber of Commerce luncheon in June, state Labor Secretary John Warner Smith said that small businesses in Louisiana are not adequately taking advantage of IWTP funding.

Harris said, “We’re reaching out to … small businesses in the state so they’ll have access to the dollars.”

He said that some tax statements issued by the state contain a blurb touting the IWTP.

The program has a fund balance of $17 million. The Department of Labor has spent $169 million on incumbent worker training since the IWTP’s inception in1998. The program has trained 184,000 employees since 1998, with 125,000 of those workers joining the program during Gov. Kathleen Blanco’s administration, Harris said.

Small companies (those with 50 or fewer employees) make up 95 percent of the businesses in Louisiana, he said.

Of the 101,000 businesses in Louisiana, 80,000 pay Unemployment Insurance taxes to the state, and are therefore eligible for IWTP funds. Of those businesses, 75,000 are small, Harris said.

To qualify for IWTP funding, companies need to have been located in Louisiana for at least three years, and have 15 employees to be trained, in addition to paying unemployment insurance taxes. Businesses can partner with other companies to meet the 15-employee quota.

Harris believes that the pre-employment training program will not be fully implemented until January 2008.

“We need feedback from interested parties” to see “how this rascal will work,” he said.

Businesses can call toll free 1-866-725-IWTP (4987) to get more information about the program.