I’m Goldie Blumenstyk, a senior writer at The Chronicle of Higher Education covering innovation in and around academe. For more than two years, I’ve been curating this weekly Re:Learning newsletter. Now I’ll be using it to share my observations on the people and ideas reshaping the higher-education landscape. Here’s what’s on my mind this week:
Topic A for the new DEW
So we may be getting a new Department of Education and the Workforce. Or maybe not. Either way, an idea for a new government-matched education-savings program that I heard about last week seems like a perfect fit for the new department. (At the very least, it speaks to the sentiment driving the proposed agency merger.)
The proposed Lifelong Learning and Training Accounts are a response to the changing nature of work. The number of people reliant on freelance work for their livelihood continues to grow; so do predictions that robots and artificial intelligence will take away jobs. It’s an environment in which “upskilling” and “re-skilling” seem to matter more than ever before.
To help people do that, Alastair Fitzpayne and Ethan Pollack of the Aspen Institute’s Future of Work Initiative propose the creation of savings accounts to which low- and middle-income workers could each contribute up to $2,000 a year on a pretax basis, as with an IRA.
Employers could also contribute, and they would get a tax break too. But the individuals would control the accounts, not their bosses. Account holders could use the money not just for those trendy coding schools but also for training in growing fields like health care and advanced manufacturing.
This concept isn’t new. Other countries have done it. I even highlighted a previous U.S.-based experiment in “The Adult Student,” a report I wrote earlier this year. That trial was conducted in the early 2000s by the Council for Adult and Experiential Learning.
Still, there’s a lot that’s appealing in the latest proposal. For one, unlike many educational tax credits, it’s targeted at people who don’t earn much. It would direct the biggest federal-dollar matches to people at the lowest income levels.
It would also limit the tax benefits to accounts with $10,000 or less. The idea behind that cap is to encourage people to tap into the accounts when they need new training and then replenish them for use later in their careers. The ideal beneficiary, Fitzpayne told me, is 25 to 65 years old, “when it’s much harder to go back to school, and they need explicit programs.” As Fitzpayne and Pollack see it, education leading to degrees, certificates, or industry-recognized credentials would all qualify for the accounts.
I’ve got plenty of questions about this idea. Will employers be any more likely to kick in for this when many already seem to be cutting back on training? At an estimated cost of $2.5 billion a year, could the tax deduction get through Congress? (For the sake of comparison, the federal government spends $180 billion per year on educational grants and tax credits now.) And perhaps most crucially, can accreditation or another accountability system make sure the money goes to legit training?