Many people talk about the lack of available IT workers. Arizona has decided to do something about it.
Arizona Governor Jane Hull signed into law the Technology Training Tax Credit, which provides 100 per cent tax credits of up to $1,500 per year per person towards the costs of training for IT skills.
“The IT training tax credit bill is a major step forward by the state in establishing policies supporting active development and attraction of New Economy companies in and to Arizona,” Barry Wong, the Arizona representative who introduced the original bill, said in a statement. “The new law will result in a rapid ramp-up of a highly qualified IT workforce. Arizona is poised to become a major New Economy hub.”
The Technology Workforce Coalition (TWC), a national group of over a dozen IT trade associations and 100 IT corporations based in Arlington, Va., has been advocating both federal and IT training tax credits for the past two years.
According to Grant Mydland, director of the TWC, the bill has been passed in Maryland as well.
“We hope to have it in 10 states in 2001. We have the bills introduced,” Mydland said. “Our interest is to provide fundamental information. Here’s what the concept is, and you modify that based on the circumstances in your region.”
Mydland said that in the US, they are looking at a free-market incentive.
“Sort of a public-private partnership to do this tax credit so we can have a process where there’s a shared responsibility in developing the skilled workforce.”
According to Mydland, the current legislation has 50 co-sponsors.
“That’s both in the Senate and in the House. The current federal bill is 20 per cent of $6,000. What we like about the Arizona model is that it really helps the entry-level employee the most, which is what we’re trying to encourage the most,” Mydland said. “Get as many people into the IT worker pipeline as possible. If you look at…the training that’s done by employers, the key is to get them to bring in as many new employees or dislocated workers and get them into the IT training career.”
News and updates can be found on the TWC Web site at www.techcoalition.org.
The Arizona Software and Internet Association (AZSOFT.net) and the Information Technology Association of Southern Arizona spearheaded the effort.
AZSOFT.net president Ed Denison said the IT Tax Credits Bill sends a message to the workforce that will help bring skills up to their needed standards.
“It sends a message to workers nationally that Arizona wants to be a home to the new economy and is willing to invest in workers so they will locate there,” Denison said.
Denison noted there are approximately 850,000 IT jobs open today.
“The realization is that our workers have to reinvent themselves every 18 months with their skill sets. Their skills become outdated with the way that technology is moving so quickly.”
Denison explained that companies figure out their tax liability to the state, then per employee they can deduct $1,500 a year off of their tax liability.
“It’s like a bottom line tax credit.”
Canada a little slower
Former national CIPS president Ken Chapman said this type of program is definitely helpful for the IT sector.
“The IT sector in Canada of course is certainly an opportunity for future economic well being for the country,” Chapman said.
Canada has a similar program, initiated by the Software Human Resource Council, that is a cash subsidy to companies hiring IT workers.
“Up to $6,000 of salary supplement is paid to the company that employs a new IT worker to assist with the initial job training and orientation that it takes to get somebody moved over into the IT sector,” Chapman said.
Chapman stated that in Canada, “we’re not sitting still.
“We’re doing some things but we should do more. It’s a very competitive market out there. Each of the major states and provinces…are aware of that.”
Gary Ford, president of Compusmart in Edmonton and board member of CompTIA Canada said Canada has the same problems as the U.S.
“We are an industry that wants people that have skills and there’s not enough of those people. Finding ways to help organizations that would otherwise hire people with the training to get people and get them trained would make a big difference in terms of our ability to move people into this industry.”
Ford said the United States has been more alert to the IT industry.
“There tends to be a greater awareness that it’s a significant part of the economy in looking for ways to facilitate that industry through legislation.”
CompTIA’s director of public policy, Bruce Hahn, said the solution is to create a greater pool of workers as quickly as possible.
“It would really make sense for all the countries to have a common approach to the issue so that the benefits for training in the U.S., Canada, and other countries were relatively the same.”