Jobs Act would help unemployed veterans, but states could do more

The American Jobs Act of 2011 includes both a tax credit and a programmatic directive intended to alleviate higher-than-average unemployment rates for veterans. There is no question that policymakers should take decisive and direct action to alleviate the high rate of unemployment among veterans. In September, unemployment among veterans of Iraq and Afghanistan was higher (11.1 percent) than the rate for non-veterans (8.6 percent).  Additionally, 21 percent of veterans of Iraq and Afghanistan report having a service-connected disabilityalmost twice the rate of reported service-connected disabilities for living veterans across all eras, both war and peacetime. While the effectiveness of the enhanced existing tax credit for hiring unemployed veterans is doubtful, the Act’s programmatic directive to assist veterans with job training and placement is promising. However, independent of the federal actions proposed in the Jobs Act, it is entirely possible for states to legislate civilian recognition of veterans’ military training and expertise in the form of professional credentials and certifications, with the result of leveling the playing field for skilled veterans competing for employment in the civilian labor market.

Unfortunately for North Carolina’s nearly 6,000 veterans of Afghanistan and Iraq, the enhanced tax incentive for hiring recent veterans is guilty of the “Field of Dreams” fallacy, in which author W.P. Kinsella’s Iowa farmer receives inspiration to build a ballpark in the middle of his cornfield from an unknown voice telling him that “if you build it, they will come.” In this case, the ballpark is an extension of the existing Work Opportunity Tax Credit (WOTC), a historically under-utilized federal tax incentive program for businesses, to recent veterans, and “they” are employers nationwide whom the Jobs Act assumes will step up their hiring of unemployed veterans in order to claim the credit.

Furthermore, research on expansion of the WOTC to veterans by the Tax Policy Center noted that “many businesses will not have sufficient tax liability to claim the credit,” in any one given year, absent the option to carry the credit back one year and forward for twenty years. On the other hand, businesses that are profitable and do owe tax could potentially receive this benefit for hiring qualified workers they would have employed regardless of their veteran status.

By and large, unemployment statistics for veterans reflect the employment challenges of enlisted personnel and non-commissioned officers, who comprise roughly 9 out of 10 of all active and separated military personnel. For veterans who have served in the time period on or after 9/11, roughly one in three served in combat arms whereby their “job” within the military centered on participation in direct tactical land combat. While many of these individuals possess extensive specialized formal military training as well as demonstrable leadership and management experience, civilian private-sector employers often fail to understand or recognize the value these veterans can bring to their firms.

The programmatic requirement for the Department of Veterans Affairs to develop a job-training program for veterans is vague, but more promising than the tax credit for hiring. Even more meaningful would be a concerted effort by states to legislate recognition for military certifications and job skills with equivalent civilian certifications and credentials so that recently separated war veterans with applicable training and skill sets can compete on equal footing with qualified civilian applicants for jobs. An October 3, 2011, article in the Fayetteville Observer offered a compelling portrait of this phenomenon about a highly decorated Army medic who cannot find civilian employment as a first responder because there is no formal recognition for his skills, training, and experience outside the military. Similar efforts on behalf of reciprocity for military spouses holding civilian professional credentials has made strong progress in several states – though not yet North Carolina – and similar action by state legislatures across the U.S. would be a truly meaningful step towards fulfilling unmet promises of a dignified and productive life to all those who have honorably served and sacrificed.

One Comment

  1. Eunice

    October 20, 2011 at 7:37 am

    Retraining and hiring of veterans should be an ongoing program funded with regular appropriations, and not a gimmicky part of some one-shot stimulus program that is here one minute and gone the next.