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94–136 PDF 2004

HEARING ON CAREERS FOR THE 21st CENTURY:

THE IMPORTANCE OF EDUCATION AND WORKER TRAINING FOR SMALL BUSINESS

HEARING

BEFORE THE

COMMITTEE ON SMALL BUSINESS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED EIGHTH CONGRESS

SECOND SESSION

WASHINGTON, DC, JUNE 2, 2004

Serial No. 108–68

Printed for the use of the Committee on Small Business

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house

COMMITTEE ON SMALL BUSINESS 

DONALD A. MANZULLO, Illinois, Chairman 

ROSCOE BARTLETT, Maryland, Vice 

Chairman 

SUE KELLY, New York 

STEVE CHABOT, Ohio 

PATRICK J. TOOMEY, Pennsylvania 

JIM DEMINT, South Carolina 

SAM GRAVES, Missouri 

EDWARD SCHROCK, Virginia 

TODD AKIN, Missouri 

SHELLEY MOORE CAPITO, West Virginia 

BILL SHUSTER, Pennsylvania 

MARILYN MUSGRAVE, Colorado 

TRENT FRANKS, Arizona 

JIM GERLACH, Pennsylvania 

JEB BRADLEY, New Hampshire 

BOB BEAUPREZ, Colorado 

CHRIS CHOCOLA, Indiana 

STEVE KING, Iowa 

THADDEUS MCCOTTER, Michigan 

NYDIA VELA ́ ZQUEZ, New York 

JUANITA MILLENDER-MCDONALD, 

California 

TOM UDALL, New Mexico 

FRANK BALLANCE, North Carolina 

ENI FALEOMAVAEGA, American Samoa 

DONNA CHRISTENSEN, Virgin Islands 

DANNY DAVIS, Illinois 

GRACE NAPOLITANO, California 

ANI ́BAL ACEVEDO-VILA ́ , Puerto Rico 

ED CASE, Hawaii 

MADELEINE BORDALLO, Guam 

DENISE MAJETTE, Georgia 

JIM MARSHALL, Georgia 

MICHAEL MICHAUD, Maine 

LINDA SA ́ NCHEZ, California 

BRAD MILLER, North Carolina 

[VACANCY] 

J. MATTHEW SZYMANSKI, Chief of Staff 

PHIL ESKELAND, Policy Director 

MICHAEL DAY, Minority Staff Director

(II) 

C O N T E N T S 

WITNESSES

Page 

DeRocco, Hon. Emily Stover, Assistant Secretary of Labor, Employment and 

Training Administration ...................................................................................... 4

Lewis, Hon. Edward G., Chairman, Board of Directors, National Veterans 

Business Development Corporation .................................................................... 6

Buehlmann, Dr. Beth B., Ph.D., V.P. and Executive Director, U.S. Chamber 

of Commerce ......................................................................................................... 21

McCarthy, Mr. Brian, Chief Operating Officer, Computer Technology Industry 

Association ............................................................................................................ 23

Joyce, Mr. Roger, V.P. of Engineering, National Association of Manufacturing 25

Volgenau, Dr. Ernst, Chairman and CEO, SRA International ............................ 28

Coffey, Mr. Matthew B., President and Chief Operating Officer, National 

Tooling and Machining Association .................................................................... 30

Peers, Mr. Randolph, V.P. for Economic Development, Brooklyn Chamber 

of Commerce ......................................................................................................... 31

Caslin, Mr. Michael, Executive Director and CEO, National Foundation for 

Teaching Entrepreneurship ................................................................................. 34

APPENDIX

Opening statements: 

Manzullo, Hon. Donald A. ................................................................................ 52

Velazquez, Hon. Nydia ..................................................................................... 54

Prepared statements: 

DeRocco, Hon. Emily Stover, Assistant Secretary of Labor, Employment 

and Training Administration ....................................................................... 56

Lewis, Hon. Edward G., Chairman, Board of Directors, National Veterans 

Business Development Corporation ............................................................. 67

Buehlmann, Dr. Beth B., Ph.D., V.P. and Executive Director, U.S. Chamber of Commerce ........................................................................................... 84

McCarthy, Mr. Brian, Chief Operating Officer, Computer Technology Industry Association ......................................................................................... 95

Joyce, Mr. Roger, V.P. of Engineering, National Association of Manufacturing ............................................................................................................. 107

Volgenau, Dr. Ernst, Chairman and CEO, SRA International ..................... 113

Coffey, Mr. Matthew B., President and Chief Operating Officer, National 

Tooling and Machining Association ............................................................. 131

Peers, Mr. Randolph, V.P. for Economic Development, Brooklyn Chamber 

of Commerce .................................................................................................. 146

Caslin, Mr. Michael, Executive Director and CEO, National Foundation 

for Teaching Entrepreneurship .................................................................... 153

(III) 

(1)

HEARING ON CAREERS FOR THE 21st CENTURY: THE IMPORTANCE OF EDUCATION 

AND WORKER TRAINING FOR SMALL BUSINESS 

WEDNESDAY, JUNE 2, 2004

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON SMALL BUSINESS

Washington, D.C. 

The Committee met, pursuant to call, at 2:08 p.m. in Room 2172, 

Rayburn House Office Building, Hon. Donald A. Manzullo presiding. 

Present: Representatives Manzullo, Velazquez, Bartlett, Franks, 

Beauprez, King, Udall, Sanchez 

Chairman MANZULLO. Good afternoon and welcome to this hearing of the Committee on Small Business. A special welcome to 

those who have come some distance to participate and to attend 

the hearing. 

Our nation is now in a global economy, and businesses both big 

and small must compete in regional markets within the U.S. as 

well as those in distant corners of the globe. The competition for 

ideas and innovation is as expansive as the markets themselves. 

The U.S. economy is still the strongest in the world. Jobs and 

manufacturing are recovering slowly, but the recovery is broad 

based, just what we want. 

Those who come to Washington for assistance in providing training, however, must be committed to providing jobs to those trained 

and to providing and retaining jobs in the United States. 

However, to maintain this country’s competitiveness, we as a nation cannot dwell on past successes. Instead, we must accept the 

challenge of the future and build and preserve a foundation for continued success. 

To continue this country’s competitiveness in world markets requires a workforce constantly trained and available in those skills 

needed in an increasingly technology-centered and computer-based 

environment. Equally important to playing a leadership role in the 

world economy is the education and foresight of those who manage 

and direct U.S. businesses. In order to foster and sustain both this 

nation’s worldwide competitiveness and domestic job growth, requires making life-long career training and education a national 

priority. 

My friend and colleague, Congressman Jerry Weller of Illinois, 

has introduced legislation, H.R. 4392, that will assist employers 

2

and employees to get those technical skills necessary to keep this 

nation’s workforce and industries on the cutting edge of science and 

technology. H.R. 4392, the ‘‘Technology Retraining and Investment 

Now Act of 2004,’’ addresses the critical problem of providing a 

high-tech workforce capable of mastering the ever-changing advances in the design and manufacture of increasingly sophisticated 

products, especially those connected with computers and information technology. 

I strongly support job training and retraining. It is a key element 

in this country’s maintaining its competitiveness in world markets. 

Again, we thank you for coming to this hearing. 

I now yield for an opening statement by my good friend and colleague, the Ranking Member, Ms. Velazquez of New York. 

[Chairman Manzullo’s statement may be found in the appendix.] 

Ms. VELAZQUEZ. Thank you, Mr. Chairman. 

As our nation experiences a rising tech industry and a recovering 

manufacturing sector, we also see the increased need for skilled 

workers. This growing demand for skilled labor is an increasing 

trend in this country. As our nation struggles to sustain an economic recovery, we cannot afford to have a shortage of qualified 

trained workers within some of our most prominent industries. 

Sixty percent of all jobs are classified as skilled while only 20 percent are classified as nonskilled. 

Our country’s failure to meet the demand for these trained workers poses a serious threat to our competitiveness in the global market and to our ability to sustain an economic recovery. Much of this 

has to do with the fact that the manufacturing sector has been hit 

hardest by the shortage. A recent report stated that more than 80 

percent of manufacturers claim to have difficulty finding qualified 

employees and that 60 percent of manufacturers typically reject 50 

percent of all applicants because of a lack of skills. 

At a time when technology is causing manufacturing jobs to become increasingly skilled, a high premium has been put on employee skills. Jobs continue to move overseas, and the Bush administration’s policies are doing little, if anything, to help this nation’s 

manufacturing sector. 

Sadly, the pool of skilled labor is not ready to meet our nation’s 

demand, especially within the manufacturing sector. Foreign countries are providing the training that unskilled employees need, 

shifting even more American jobs overseas. Our nation’s small 

businesses and manufacturers do not have the funding to offer 

these vital training programs. 

In today’s hearing, we will examine the eight-week-long Republican agenda, Hire Workers Initiative. This week’s focus is on lifetime learning, and once again, there are no new solutions being offered by the Republican leadership aside from the personal reemployment accounts, which are nothing more than risky schemes. Instead, the Republicans choose to go back to legislation that has already passed and already failed, and I think that it is too soon for 

summer reruns. 

The Bush administration’s new job training dynamics are not 

conducive to meeting the needs of our nation’s industries. President 

Bush proposed commitment to hiring workers does not match up 

with his actions. Despite the fact that our nation has lost over 2.8 

3

million jobs in the manufacturing sector since the start of 2001, the 

Bush administration makes cuts to vital employment and training 

programs that benefit this industry. 

President Bush’s request for funding for the Manufacturing Extension program is more than $66 million less than the program’s 

funding level in 2003. The Manufacturing Extension program aids 

small- and medium-sized manufacturers with technical and business solutions and has made it possible for over 150,000 of our 

country’s small businesses to tap into the expertise of knowledgeable manufacturing and business specialists all over the United 

States. 

Another vital program that has been underfunded by the Bush 

administration is the Trade Adjustment Assistance program. This 

program offers retraining to displaced workers. But most of these 

dislocated manufacturing employees receive no help from TAA. 

At a time when training programs are crucial for displaced employees, President Bush cut funding for the program. These come 

at a time when the number of people benefitting from TAA is on 

the rise, and this funding will not meet the increasing demand for 

the program. Cutting funding for employment and training initiatives such as these is not the way to help the manufacturing sector 

sustain an economic recovery while they are already experiencing 

a shortage of skilled workers. These cuts also hurt our small businesses which create 75 percent of all new jobs and face greater 

workforce-development barriers than their corporate counterparts. 

If President Bush truly cared out about nation’s workforce, then 

he would start adequately funding employment and training programs that promote skilled employees. The livelihood of our nation’s small manufacturers and small businesses depends on it. 

Thank you, Mr. Chairman. 

Chairman MANZULLO. Thank you. 

[Ranking Member Velazquez’s statement may be found in the appendix.] 

Our first witness is Emily Stover DeRocco, assistant secretary of 

labor for employment and training. We are going to set the clock 

for about five minutes, but before we do that, if you could just take 

a minute, Secretary DeRocco, to give us an idea what your background is. 

Ms. DEROCCO. Certainly. 

Chairman MANZULLO. And then if you could pull that mike closer 

to you. There you are. A little bit closer. Then as soon as you tell 

us what your background is, after a minute or so, then we will 

start the clock. Is that fair enough? 

Ms. DEROCCO. Absolutely. 

Chairman MANZULLO. It will be the same for you, Secretary 

Lewis. Please. 

Ms. DEROCCO. I was appointed to this position by President 

Bush in June of 2001 and confirmed in August of that year. Prior 

to that, I served for about 10 years as executive director of the national organization that represented the gubernatorial appointees 

across the country responsible for the full array of employment and 

training workforce-development programs within their states. I had 

previous appointments in both the administrations of Presidents 

Reagan and Bush I. 

4

Chairman MANZULLO. Okay. Now we will start the clock. Thank 

you. 

STATEMENT OF EMILY STOVER DeROCCO, EMPLOYMENT AND 

TRAINING ADMINISTRATION, DEPARTMENT OF LABOR 

Ms. DEROCCO. Thank you so much, Mr. Chairman and Congresswoman and members of the Committee. I am very pleased to have 

the opportunity to testify today to discuss workforce issues to maintain the nation’s leadership in world markets, with a particular 

emphasis on our manufacturing sector, including how we train and 

retrain our workers so that they are competitive in the world economy. I will summarize my written testimony quickly. 

In my capacity as assistant secretary of labor for employment 

and training, I am responsible for overseeing the nation’s public 

workforce investment system, which provides a vast array of employment and training services to prepare youth, adults, and workers transitioning between jobs for employment in the 21st century. 

Most of these services are available through a network of almost 

2,000 comprehensive, one-stop career centers and another 1,600 affiliate one-stop centers network. Through this network system, 

workers have the advantage of access to a broad range of employment and training services, including those available through the 

one stop that are provided by our partner programs, some 17 additional federal programs. 

Through our programs and some initiatives that I will describe 

in a moment, the Department is building a demand-driven system 

to provide America’s economic engine, businesses, with the highestquality workers possible and to link the two together for their mutual benefit. This relationship allows businesses to be more competitive in the global economy and allows workers to live more productive and prosperous lives. 

Earlier this year, the administration submitted to the Congress 

a report on manufacturing in America that outlined a comprehensive strategy to address the challenges facing our manufacturers. 

Soon, the Department of Labor will be submitting its own report 

highlighting trends in manufacturing employment. 

Several themes emerge from these reports. The first concerns the 

importance of the manufacturing sector, on which we can all agree. 

The United States is the world’s leading producer of manufactured 

goods and, standing alone, the U.S. manufacturing sector would 

represent the world’s fifth-largest economy. Manufacturing remains 

a powerful engine of economic growth in this country and is vital 

to the technology boom, and our manufacturing base generates 

enormous economic activity in other industry sectors. 

A second theme concerns the transformation of the manufacturing sector caused by long-term structural forces, such as the 

shift from low-tech manufacturing to advanced manufacturing, the 

greater integration of technology and production, and the 

globalization of production. To help ensure solid and sustainable 

expansion in coming years, we must recognize that some current 

and prospective workers have insufficient skills for the higher 

skilled job openings that do exist and will become more numerous 

in the future. 

5

When I co-chaired the Department of Commerce Manufacturing 

Roundtable of workforce issues, I heard directly from industry executives about skill shortages. One of the most protracted problems 

that employers face is the lack of skilled workers to operate their 

high-tech manufacturing plants. Even during the recession, as the 

Congresswoman cited, 80 percent of manufacturers said they had 

a moderate-to-serious shortage of high-quality production applicants, not just of engineers. 

The more pervasive problem is now the need for production 

workers, machinists, and craft workers skilled enough to work in 

the manufacturing jobs of the 21st century, and the demographics 

of the workforce are likely to exacerbate the shortage of skilled 

workers in the coming years. American manufacturers could have 

a difficult time finding workers to run tomorrow’s factories and offices. 

We recognize that skills and education are now a dominant, if 

not decisive, factor in our ability to compete in the global economy. 

We must have the best-skilled workforce possible to maintain 

America’s competitive advantage and for our continued economic 

growth. That is where the Department of Labor has an important 

role to play. Our task is not to cultivate a workforce trained for 

jobs listed in last week’s want ads but rather to ensure that people 

are moving through an education and training pipeline to be prepared for the new jobs that are being created, in many cases by 

brand-new companies in brand-new industry sectors. 

We must cultivate skill sets that connect to real-world needs and 

real-world opportunities, and as we strive to be competitive in the 

global economy, we also recognize that some industries and workers will be impacted by business decisions and competitive pressures, and inevitably some workers will need to retool and retrain 

from the skills no longer required by declining industries to skills 

demanded in emerging sectors of the economy. The Department 

provides a vast array of services to assist workers who are 

transitioning between jobs, and these are outlined in detail in my 

prepared statement. 

The president has asked the Department of Labor to target those 

industries generating the most new jobs where the greatest skill 

shortages exist and focus on the talent base to fill those jobs. American manufacturing is among those sectors. 

As we increase our understanding of these workforce challenges, 

we also must improve the responsiveness of the publicly funded 

workforce investment system, and we are committed to doing that. 

First, through the reauthorization of the Workforce Investment 

Act, we have proposed increased flexibility and effectiveness of our 

training programs. 

Second, in his 2005 budget, the president has requested an additional $250 million to strengthen the role of community and technical colleges in training workers for these jobs. 

Third, personal reemployment accounts would offer additional 

funds for a different type of service delivery geared to an individual’s needs to reattach to the employment market. 

And, finally, in April, President Bush announced his proposal to 

further reform job-training programs to provide more dollars for 

6

America’s workers so they could access better training for better 

jobs. 

Taken together, our current programs and proposed initiatives 

will provide important tools to help address the structural changes 

in the manufacturing industry and will also help provide the 

skilled workforce needed in the manufacturing industry of the 21st 

century. I would be pleased to answer any questions you or other 

Committee members may have after the conclusion of my———. 

[Hon. DeRocco’s statement may be found in the appendix.] 

Chairman MANZULLO. Thank you very much. 

Our next witness is Honorable Edward G. Lewis, chairman of the 

board, National Veterans Business Development Corporation, also 

known as ‘‘The Veterans Corporation.’’ Mr. Lewis, we look forward 

to your testimony, but before we start the clock, just give us a 

minute, take a minute, and tell us about your background. 

Mr. LEWIS. Thank you, Mr. Chairman. I have been on the board 

of directors of the Veterans Corporation since October 2001, having 

been appointed by President Bush, and was elected as chairman in 

December. Currently, I founded and run an international management and technology consulting company from the great State of 

Colorado. I am also heavily involved in teaching graduate and undergraduate courses at the University of Denver and the University of Colorado and have been doing both of these activities over 

the past 12 years. 

Prior to that, I was assistant secretary for information resources 

management and the first chief information officer in the new Department of Veterans Affairs between 1989 and 1991. Prior to that, 

I served in the United States Marine Corps for just under 21 years. 

Chairman MANZULLO. Okay. We look forward to your testimony. 

Mr. LEWIS. Thank you very much. 

Chairman MANZULLO. Do you see how that brings things into 

perspective, knowing that you are a Marine for 21 years and on the 

veterans board, you know. Very significant. 

Mr. LEWIS. Thank you, sir. 

Chairman MANZULLO. Now we will start the clock. Thank you. 

STATEMENT OF EDWARD G. LEWIS, NATIONAL VETERANS 

BUSINESS DEVELOPMENT CORPORATION 

Mr. LEWIS. Good afternoon, Mr. Chairman and distinguished 

members of the Committee. Thank you very much for your invitation to testify today. This is my first appearance before your Committee, and I am deeply honored to have this opportunity, particularly since your Committee is one of the congressional authorization committees for the National Veterans Business Development 

Corporation. 

As chairman of the board, as a private citizen, and as an entrepreneur, and as a longtime educator, I commend the leadership 

role that this Committee is providing and strongly support your efforts to bring focus on these critical education and training issues. 

Today, my comments on education and training are primarily focused on one group of individuals in this country, our veterans, including service-disabled veterans, but more specifically, on those 

veterans who are involved in entrepreneurial endeavors and small 

business enterprises. 

7

Let me focus on five issues from my written testimony. First, in 

my view, entrepreneurship is alive and well in this country. The 

self-employed, home-based businesses and small business enterprises are, in fact, the backbone of this nature’s economic infrastructure, vitality, and strength. Many people in this country, including veterans, own small businesses and contribute significantly 

to domestic job growth, the overall productivity of this nation, and 

its competitive posture in the global marketplace. To be successful 

entrepreneurs, veterans must gain in-depth knowledge needed to 

succeed in both the start-up and growth phases of small business 

entrepreneurial activities. This knowledge can be gained through 

effective entrepreneurial education, mentoring, and counseling, not 

on a one-time basis but on a learning continuum throughout the 

life of the entrepreneurial activity. 

Second, there is no question that future technology innovation 

and information technologies are extremely important for organizations to remain competitive in the world’s markets to help support 

job creation and growth and to meet our future challenges. To leverage the strategic value of information technologies within our 

organizations, we need to ‘‘informate’’ our organizations, not automate them. 

To evolve an Information Age society requires more effective education and training, including entrepreneurial education throughout our society. This education and training must begin at an early 

age and become a significant part of lifelong learning for all individuals as well as for and within organizations. It must become all 

encompassing to be effective. 

Third, congressional intent was and is clear within Public Law 

106–50 passed in August 1999. Entrepreneurial, veteran-owned, 

small business enterprises are critical to this nation and to our national economic viability. We must and should, as a nation, support 

veterans in their entrepreneurial endeavors to provide them the 

necessary resources and capabilities to help them grow and build 

their small business enterprises. To be successful in supporting veteran entrepreneurship, the Veterans Corporation, established 

under Public Law 106–50, must facilitate and coordinate public 

and private resources in a dynamic collaborative effort across this 

country in order to provide veterans with the necessary resources 

and capabilities to build and grow their small business enterprises, 

including entrepreneurial education, mentoring, and counseling. 

Fourth, we are currently working with the Association of Small 

Business Development Centers and the VA Center for Veteran Entrepreneurship to help facilitate implementation of the provisions 

of the recently passed Public Law 108–183 that can provide service 

members and veterans who have Montgomery GI Bill benefits with 

funding to pay for entrepreneurial education courses. I also want 

to recognize and fully support the recent Veterans Earn and Learn 

Act to help modernize on-the-job training and apprenticeship programs reflecting today’s marketplace. 

Fifth, and finally, the Veterans Corporation is currently in the 

initial stage of developing and evaluating a concept referred to as 

the National Veterans Entrepreneurial Education Initiative. The 

overall goal is to provide high-quality entrepreneurial education in 

the most cost-efficient and effective manner possible to as many 

8

veterans as possible, including Reserve and Guard personnel. The 

intent of this national initiative is to develop and provide a strategic vision and strategic leadership at the national level, building 

a coalition of private and public organizations for effective implementation of this initiative at the local level. The strategic initiative would include an all-encompassing, comprehensive, lifelong entrepreneurial learning continuum to include a wide range of formal 

and informal entrepreneurial education, training, mentoring, and 

counseling, and assistance for veterans in full support of their entrepreneurial endeavors and small business activities. 

In summary, we in the Veterans Corporation are proud of our efforts over the past 20 months in providing effective entrepreneurial 

education to veterans, including service-disabled veterans. Many of 

us also realize that for the Veterans Corporation to be truly successful in helping entrepreneurial veterans over the long term, we 

must be able to develop and deliver effective programs and services, including collaborative, cooperative partnerships that are 

unique and that directly support veteran entrepreneurship, including a dynamic, all-encompassing, lifelong-learning approach to entrepreneurial education, mentoring, and counseling. In this way, 

the Veterans Corporation can effectively support the goals of this 

Committee. 

Again, thank you very much, Mr. Chairman and distinguished 

members of the Committee, for this opportunity to express my 

views. I now would be pleased to answer any of your questions. 

[Hon. Lewis’ statement may be found in the appendix.] 

Chairman MANZULLO. Thank you. I appreciate the testimony. 

We have a unique situation in Rockford, Illinois. Our unemployment just fell below 10 percent for the first time in probably two 

years, and we are excited about that. No new manufacturing jobs 

have been added, but we continue to lose them. Illinois is one of 

four states that continues to lose manufacturing jobs at a lower 

pace than before. At the same time, we have a unique situation 

where people involved in manufacturing have placed ads in the 

newspaper advertising for machinists. 

Secretary DeRocco, you have a smile on your face that you have 

heard that situation before. Tell us what is going on. Can you take 

a guess at it? I have got an idea, but I would like to hear your 

ideas. 

Ms. DEROCCO. The dynamics of each local labor market are so 

different, but there is a certain skill requirement in the machinist’s 

trade that is not necessarily available in the manufacturing workforce as we have known it in the past. That is why it is so critical 

for this public workforce system to get smart by talking first with 

businesses and those who are creating jobs and have jobs available 

to understand what skills workers need so that we are investing 

this vast amount of public resources in training to those skills so 

that the workers can make transitions to jobs that are available as 

quickly and effectively as possible. 

We also, through reauthorization of the Workforce Investment 

Act, have encouraged Congress to make available more of the resources for incumbent worker training so that if there is a shift in 

a production process or in skill sets needed by a workforce before 

they are laid off, these resources can be brought to bear on behalf 

9

of those workers while they are still employed, and we do not experience more periods of unemployment. 

It is a skills mismatch and job availability that this system, acting as a smart intermediary that brings business and workers together effectively with the educational institutions, that can provide the training most effectively, and would make this a wise investment of public resources and a much more important system 

to local economies. 

Chairman MANZULLO. That is good analysis. Just a couple of 

things I want to throw out, and either you want to comment on 

them or not touch them; that will be up to you. 

Maybe 50 years ago, 40 or 50 years ago, a bunch of people involved in education in this country sat down decided that there was 

something intrinsically wrong with people who work in shops and 

that machine oil was not good, that to be a successful person, you 

had to go to a four-year college and get a degree, and that has resulted in what I consider in this country to be an anti-manufacturing culture, that people like my father, who was a skilled machinist before he became a skilled butcher, skilled carpenter, and 

a skilled restaurateur, back in those days, they all worked with 

their hands. I looked upon the fruit of his hands with great pride. 

And then the technical schools and the high schools decided to 

scale back the classes—we called them machine shops and woodworking and automotive repairs—because the demand went down. 

Kids got it in their head that perhaps there was something more 

to life than working with your hands. And then the technical 

schools became centralized so the people that were going to go to 

college stayed at their high school, and those that were going to go 

into manufacturing or the ‘‘industrial arts,’’ as it was called, were 

bussed to a central location. Thus, you had a segregation and a division in this country. Would either of you like to comment on that? 

Ms. DEROCCO. I would love to. 

Chairman MANZULLO. I think that Mr. Lewis has a thought on 

that, too. I saw him nodding his head. Go ahead. 

Ms. DEROCCO. Okay. We will both comment. It is true that we 

have experienced something of a college culture in the United 

States, and both the Department of Education and the Department 

of Labor recognize that as we look at the jobs that are being created and available. Believing that all young people and 

transitioning workers need a strong academic foundation to succeed in almost any field of endeavor and supporting education fully 

for that reason, we also have launched an initiative we call ‘‘Skills 

To Build America’s Future’’ that we hope will re-lift the attention 

to and the respect for the skilled crafts and trades that are prominent in so many of our growth sectors, starting with construction 

and moving into manufacturing. 

Many of the skills that are being developed or that need to be 

developed to support occupations and careers in these fields have 

long career pathways and lifelong education and training opportunities, and certainly we in the public workforce system need to support those better. We think we need to do it in partnership with 

the educational system with a new vision of what vocational education in this country and career opportunities are all about. We 

10

have begun that effort, and I would be eager to share more information about that with you. 

Chairman MANZULLO. Mr. Lewis? 

Mr. LEWIS. I have several points that I would like to make. One, 

with reference to whether or not it takes a college education to succeed out there, I think Bill Gates, Michael Dell, and Tiger Woods 

are examples where it does not, not to demean the college education. It has its proper place as does all sorts of different training 

opportunities, and we should not dismiss any of these. 

Second, with regard to the classroom environment, two things I 

would like to point out, at least in my experience, and I think I 

have a fair amount in terms of teaching, in business schools, across 

the board in this country, there is not an emphasis on manufacturing in the business schools. There is maybe a course here and 

there but certainly not a dedicated emphasis which we have general courses, and I think that certainly is something that should be 

considered. How can we evolve that type of environment in order 

to effectively support people moving into the manufacturing environment? 

Third, I also want to emphasize that one of the keys to success 

in our organizations, including manufacturing, is clearly the role of 

information technologies. However, in terms of the educational 

process, I think in many cases we sometimes do a disservice in 

terms of educating people in information technologies by focusing 

just on the technologies themselves and not in terms of the strategic value they provide to organizations. 

This is an issue that needs to be emphasized within all aspects 

of education and particularly in the university environment. Regardless of course, whether it is accounting, whether it is operations management, whether it is finance, the role of information 

technology is extremely important as students then take that 

knowledge to the private sector in terms of their jobs, whether it 

is in service or manufacturing. In order to be effective, though, in 

those jobs, they need to better understand the role of information 

technology. 

Chairman MANZULLO. Thank you. Congresswoman Velazquez? 

Ms. VELAZQUEZ. Thank you, Mr. Chairman. 

Ms. DeRocco, you mentioned that the president increased funding for the workforce development programs, but, in fact, the administration Fiscal Year 2005 budget reduces funding for such programs as Perkins, Manufacturing Enterprise program, ATP, to 

name a few. I have here a chart prepared by CRS with all of the 

programs, and when you add them up, the total cut is $125 million. 

So how are we going to close the skill gap to address the training 

needs of our workforce when you are not supplying the resources 

that we need? 

Ms. DEROCCO. I am not familiar with the chart you have in front 

of you. Our budget reflects that our 2005 request for training and 

employment services under the Workforce Investment Act is, in 

fact, an increase from the 2004 level of appropriations, so I would 

be interested in comparing those numbers with you. 

Ms. VELAZQUEZ. I guess that the administration has a conflict between your numbers and the ones that are supplied by CRS. That 

is the congressional research office. 

11

Ms. DEROCCO. Our training and employment services budget for 

the Employment and Training Administration, which leads the 

workforce investment system, is $3.279 billion for adults in 2005, 

compared to a $3.129 billion appropriation in 2004. 

I would also mention that, in terms of funding for the Trade Adjustment Assistance program, which you mentioned, we are providing $220 million, which is the statutory cap for training, in that 

program. As you know, it is a capped entitlement, so the amount 

available is what Congress makes available, which is $220 million———. 

Ms. VELAZQUEZ. You are not adding in your numbers those cut 

by the Department of Education within the Department of Education. That is why you get those numbers. 

Ms. DEROCCO. In terms of the first question, you mentioned Perkins, which is at the Department of Education, and the Manufacturing Extension Partnerships, which are at the Department of 

Commerce, I did want to mention to you, as it relates to the Manufacturing Extension Partnerships, that we are working very closely 

with the MEPs in the president’s high-growth, job-training initiative in advance manufacturing because in many communities they 

are a partner in new projects that bring together business, education, and the public workforce system and are receiving funding 

through the Department of Labor in addition to their appropriated 

level. So I just wanted you to be aware of those projects that we 

are working on because MEPs can be very important components 

of a community’s economic-development plan when there continues 

to be a strong manufacturing presence. 

Ms. VELAZQUEZ. May I? 

Ms. DEROCCO. Absolutely. 

Ms. VELAZQUEZ. Yes. Here you are telling me that you are working with all of the MEPs, but when we look at the budget, the 

president zeroed out the budget for that. 

Ms. DEROCCO. Again, I am not familiar with the Department of 

Commerce budget specifically. I did not believe that they were zeroed out. I just wanted you to know that there are additional crossagency partnerships and funding opportunities that the 

MEPs———. 

Ms. VELAZQUEZ. Can we talk for a second about the Jobs for the 

21st Century Initiative——

Ms. DEROCCO. Certainly. 

Ms. VELAZQUEZ [CONTINUING] That represents the hallmark of 

the administration in terms of job training? An editorial in the 

Minneapolis Star Tribune found that funding for the Labor Department’s key worker training programs have fallen by 10 percent 

since the president took office. Could you please explain how the 

president’s plan will compensate for these cuts? 

Ms. DEROCCO. Well, again, I cannot hold the Minneapolis Tribune up as an expert on the federal budget. According to our budgets, there has not been a 10 percent cut in terms of any of the 

funding for the workforce investment programs at the Department 

of Labor. I will say the president has added $250 million for a community college initiative that will add training opportunities for 

workers. He has also requested authorization for a $50 million additional investment in personnel reemployment accounts, which is 

12

not a cut in any other program but is, instead, an opportunity to 

add a new service-delivery option in the one-stop career center system. 

Ms. VELAZQUEZ. When it comes to numbers, coming from the administration—I do not know if you recall the debate on Medicare 

prescription drugs, numbers that were sent to us, and then after 

we passed the legislation and we voted on, we discovered that the 

White House was telling us that the numbers were not the numbers that they submitted to us. When it comes to the numbers, I 

really believe what CRS is sending us, and what it shows is that 

there is a cut in those workforce training programs within the federal government at a time when we need to provide resources because if we are saying that small businesses are the job creators, 

and I think that is what the president tell us when he goes around 

and visits small manufacturing business people, well, you know, we 

need to provide the resources to help them, and we are not. We are 

cutting them, according to the CRS. 

Ms. DEROCCO. Again, I would also like to draw your attention 

and would like to share with you another set of numbers that we 

feel very strongly about, the strong investment in the workforce investment system and continue that investment. As you know, more 

than 80 percent of the dollars through the Workforce Investment 

Act are sent by formula down to the states and subsequently to 

local areas. Virtually every state of the union has carried over resources from one year to the next, resources that they have not 

been able to spend yet, and as long as that continues to be part 

of this system’s financial-management picture, in tight budget situations, both the Congress and the administration seek to balance 

the availability of funds for programs. 

Ms. VELAZQUEZ. Let us talk about the states for a second. Can 

you please explain the Department of Labor’s rule change which 

ended the practice of states bundling small groups of laid-off workers to reach the threshold of 50 employees needed to access national emergency grant funds? 

Ms. DEROCCO. That actually was an incorrect press article as 

well that has appeared in several newspapers. This is in relation 

to the national emergency grants, which is a small proportion of 

the dislocated worker funds———. 

Ms. VELAZQUEZ. A lot of newspapers across the nation got the 

wrong information. 

Ms. DEROCCO. The newspapers often get information wrong. It 

is, in fact, still the policy of the Department of Labor that there can 

be bundling, as I believe you called it, where there is a communitywide impact by layoffs within an industry sector or across industries, and the policy of the Department is clear. I would be glad to 

share with you the guidance that was issued. 

Ms. VELAZQUEZ. Will that apply to everybody or just rural? 

Ms. DEROCCO. I am sorry. Just whom? 

Ms. VELAZQUEZ. Rural, rural communities. 

Ms. DEROCCO. Just rural communities. The ability to go crossindustry is specifically attributable to rural areas. 

Ms. VELAZQUEZ. So what about nonrural communities? 

Ms. DEROCCO. Again, the formula dislocated worker program dollars are available in every local community through their local 

13

workforce investment boards to provide exactly the same services 

for workers who are impacted in very small numbers throughout 

country, and there continue to be formula dislocated worker funds 

available to serve those workers. National emergency grants are an 

additional, supplemental source of funds for the larger dislocations, 

and in the case of rural communities, for a larger number of people 

when across industries or across sectors there is a layoff impact. 

Chairman MANZULLO. Congressman Beauprez? 

Mr. BEAUPREZ. Thank you, Mr. Chairman, and I would like to 

thank both of our witnesses. 

Secretary DeRocco, I would like to comment on something you 

brought up. The Community College Initiative and the personal reemployment accounts, I think, are very good solutions. The community college network out my way is doing a tremendous amount of 

good work. 

We did not rehearse this, but I want to go down the avenue that 

was started by the chairman. I think many times when we talk 

about reemploying or retraining a workforce, we are talking about 

solving a problem that has already been created, to a degree, and 

I would like to see if we cannot lessen the number of problems out 

there. 

The avenue that the chairman started down, I reflect often on 

the school when I went there, and we did have industrial arts, and 

we did have some practical training classes available. I am all for 

higher ed. Four of my kids have taken advantage of it. I took advantage of it, and I want to get as many doctors and professionals 

out there as we can possibly get, but I think the place that we are 

really falling down as a society are the many, many, many people 

that do not feel that that is where they are headed. And as a result, I have talked to a lot of school principals right in my district—

I think of Jose Martinez at Jefferson High School there in 

Edgewater, and he put it very well. He said, I have got to find a 

way, a purpose, for these young boys and girls, these young men 

and women, to stay in school, and he said, I am struggling to give 

them that reason. What is the goal? What is the objective? And too 

often, they are out on the street because they see that as their path 

to the future. 

He started a nurse-certification program in his school. He is 

thinking of bringing industrial arts back. 

Now, the Community College Initiative, the personal reemployment accounts, if you will allow me, I see that as incentivizing a 

change in behavior, maybe to coin a phrase. Is there a better way 

we, as a society, use the Department of Labor? You, Mr. Lewis, I 

think one of the benefits of being a veteran is you learn how to do 

things while you are in service to the country. Is there a better way 

we ought to be incentivizing or providing the tools earlier in life for 

a broader perspective education? My dad got to eighth grade, but 

he was never out of work a day in his life because he used these. 

That is a pretty noble progression. If you work with your hands, 

it still works for me. Do either of you have ideas you would share 

with this Committee? 

Ms. DEROCCO. Clearly, my colleagues at the Department of Education, clearly, both of us believe, the Department of Labor and the 

Department of Education, that there needs to be far better career 

14

information available to young people and to transitioning workers, 

knowledge about what is becoming available in the 21st century 

economy. There are career opportunities, jobs that we did not think 

of when we were in school and had never heard of, and they are 

being created every day. 

There is some responsibility on the part of the Department of 

Education and the Department of Labor to connect the world of 

work, the realities of education and the various pathways that are 

available in a post-secondary- education world. The post-secondary 

alternative should be expanded to create additional pathways to 

the full array of careers and occupations that are growing and 

available to our young people and workers, and I think my first 

recommendation would be that we take a much stronger role together in connecting the world of education and the world of work 

through good career information and leading to the kinds of guidance that will allow individuals to choose their own pathways and 

access these resources that are available to them to help them 

along those pathways. 

Mr. LEWIS. I think this is a very, very important issue, and I 

think it is in a broader context, a broader issue that goes much beyond the educational environment. On one hand, when we talk 

about hands, I would put it in a different perspective and say that 

the mind is a wonderful thing if we properly evolve our capabilities 

to assess issues and be able to use our mind properly. What I mean 

by that is, all too often in my experience in education, we seem to 

just be going through the motions. 

I have a very personal view, for example, in terms of what a 

trend is in this country, for example, in distance learning, online 

education. Having taught, as I said, over 350 courses, I take a very 

personal view in establishing a very personal bond with each of my 

students, and I think education is all about that because that emanates from your home, it emanates from your family, and that is 

where it all begins. And so when I look at the educational models 

that we have out there, I become very concerned that we are 

distancing our teachers from our students. 

On one hand, I think that to be successful, to be able to reach 

out, to be able to work with the individual students to cultivate 

them, to imbue them, because I can only relate to my experiences 

growing up as a young man, that it is those teachers that took the 

time to work with me, to encourage me, not through a computer, 

not through, you know, go enter into some classroom, and you become a part of a group of people, but to truly work with me as an 

individual. That is where I think that our educational models have 

gone wrong. I think that our education, we should go back to the 

focus that it is a relationship that exists or that develops between 

the mentor, the teacher, as well as that student. 

Chairman MANZULLO. Mr. Udall? 

Mr. UDALL. Thank you, Mr. Chairman, and I thank the panel for 

being here today. 

I think you will agree with me that the real creators of jobs are 

small businesses. I do not think there is any doubt about that. And 

so, knowing that, we should want to get these programs that deal 

with the issues you are testifying about—education, worker training—to small businesses, and that is very important. And there is 

15

kind of a disturbing trend here, it looks to me, and my question, 

I guess, is going to the Department of Labor and to the assistant 

secretary, but you may have an additional comment on this. 

The SBA’s Office of Advocacy conducted two studies that looked 

at workforce development in small business in 1992 and 2001. The 

studies found that among firms with less than 25 employees the 

percentage who had heard of government training programs was 

cut in half, from 49.8 percent to 24.2 percent from 1992 to 2001. 

What I would like to know from the assistant secretary is what initiatives has the Department of Labor undertaken to correct this 

problem and increase outreach to small businesses. Can you tell us 

specifically what resources have been used to address this shortcoming? 

Ms. DEROCCO. That is a very important shortcoming you have 

identified, congressman, and I would agree with you that the public 

workforce system and its resources should be known by small businesses and should be accessed by small businesses. As you know, 

this is a system that has devolved so that local workforce investment boards really oversee the service delivery system in communities, the one-stop career centers, and those local workforce boards 

are appointed by mayors or county officials, and it is through those 

boards that there should be broader outreach into the community 

and marketing of the services that are available. We really do not 

have as much of a direct federal role other than to encourage 

the———. 

Mr. UDALL. So your answer would be the Department of Labor 

itself has not dedicated any resources to this kind of outreach that 

I am talking about. 

Ms. DEROCCO. I guess that is not correct. We do have a partnership with the Small Business Administration specifically to work in 

communities and have dedicated some demonstration resources 

from our national activities programs to reach into communities 

and create small business opportunities, entrepreneurial training, 

and the kind of business training that many small businesses need 

initially. 

We also have a national business engagement consortium that is 

a number of states that we fund to create marketing materials to 

be used nationally by the one-stop career centers and the local 

boards for both small and large businesses. Washington State 

chairs that national business consortium. And we have full partnerships through which we also have financial support with the 

U.S. Chamber of Commerce and the National Association of Manufacturers to reach out to the small businesses within their memberships to better connect those small businesses with the public 

workforce system in communities around the country. I could tally 

the resources attributed to this and get that to you later, if you 

would like. 

Mr. UDALL. And do you believe that you have dedicated the kind 

of resources to turn this around? I mean, this is a pretty dramatic 

drop in a ten-year period, from 49 percent to 24 percent. 

Ms. DEROCCO. I am not familiar with that particular survey, but 

I would say nationally we have a minimal amount of resources that 

are held nationally in this workforce investment system. The majority of the resources are at the state and local level. This cerVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
16

tainly is an area that we work closely with our state and local partners to ensure—have we done enough? Probably not. 

Mr. UDALL. Okay. Well, I certainly think the Committee would 

be interested in the dollar amounts and the specifics of what you 

have dedicated. 

The same study also found that the percentage of small businesses that have ever used government training programs dropped 

from 15.9 percent to 4.5 over the same period. I am running out 

of time here, but if you could also try to let us know what the resources were that were dedicated to turning that around. 

Ms. DEROCCO. Absolutely. 

Mr. UDALL. Thank you. 

Chairman MANZULLO. Congressman Bartlett? 

Mr. BARTLETT. Thank you. I am sorry I could not have been here 

for your testimony. In a former life, I spent 24 years teaching in 

technical areas. I also worked in the business world. I worked eight 

years for IBM. 

We face two problems in our country that I do not know the answer to, and maybe you can help. When I was with IBM, we were 

concerned that we at IBM and we as a country were at high risk 

of losing our superiority in computers to Japan. I left there in ’75, 

to give you some context for the time. For a very simple reason, 

we noted that every year Japan turned out more, and at least as 

good, scientists, mathematicians, and engineers as we did in this 

country, and we at IBM understood that if that trend continued, 

we were not going to maintain our superiority in computers. 

For the short term, our inability to attract bright young people 

to these pursuits is a risk to our superiority in economics. For the 

longer term, it puts us at risk for our military superiority. It will 

not continue to have the world’s best military unless we turn out 

scientists, mathematicians, and engineers in large enough numbers. If you go to our technical schools today, you will notice that 

probably a majority of the young people who are there studying are 

not citizens of this country. 

A second problem we have is attracting people to go into skilled 

areas where they do things with their hands, and today you have 

to be pretty bright to go along with that also. We now are importing these kinds of skilled people because we cannot produce them 

through our education system. One of the problems is that you get 

what you appreciate, and I notice that the White House is not inviting academic scholars and appreciating them the way they invite 

athletic figures and appreciate them. And I am wondering what 

your suggestions are as to what we can do as a society to attract 

more of our bright young people to go into science, math, and engineering. 

By the way, today, they are increasingly going into what I consider potentially destructive pursuits. Now, we need a few of each 

of these, but more and more our best and brightest young people 

are going into careers in law and political science. Now, we need 

a few lawyers, and we need a few political scientists, and we have 

got more than a few of each of those. What is your suggestion as 

to how we might capture the imagination of our population and inspire our young people to go into these technical careers? I think 

17

this is what really puts us at risk in our competition with the rest 

of the world. 

Ms. DEROCCO. We both have ideas. It is a little outside probably 

both our bailiwicks in terms of direct jurisdiction over programs, 

but, again, I would emphasize that in our work through the High 

Growth Job Training Initiative, in all sectors, from aerospace and 

advanced manufacturing to information technology and the emerging sectors of biotechnology and geospacial technology, without exception in these forums, executives and educators have pointed to 

exactly the issues you have pointed to. Number one, we need to excite the young people, which I think we do, first and foremost, by 

providing information about the careers and the opportunities for 

growth and prosperity in those careers. We do not do enough of 

that as a nation, and we have joined together at the Department 

of Education and the Department of Labor to do that. I think that 

is critically important. 

Interestingly, one of the recommendations that came from one of 

the forums in which the president’s science adviser, John 

Marberger, participated was precisely your recommendation to 

have a very specific recognition program, recognition of excellence, 

for individuals in the engineering, math, and sciences fields to elevate once again, as we have in the past through the space program, 

the creativity and the ingenuity of our people to choose their own 

paths into these fields of endeavor that are so needed in every sector of our economy. 

Government should not choose pathways for young people or 

transitioning workers; that is an individual choice. We do have a 

responsibility to provide good information, to get that information 

in the hands of those who can make their own decisions about their 

pathways, and I think that is something that the Department of 

Education and the Department of Labor are now doing. 

Mr. LEWIS. I think there are some very interesting issues here 

with regard to how do we motivate people to want to spend a career in these types of, as you refer to, doing things with your 

hands, but more specifically, with scientists and engineers. I was 

first educated as an aerospace engineer. 

Part of the problem, I think, as a society as a whole, in the past, 

let us say, since the 1996 time frame with the dot com boom and 

the focus that we have seen in this country where everybody thinks 

they can get rich quick by doing certain things that tends to take 

away from that type of emphasis on what I would call those really 

substantive types of areas in terms of education for science and engineering. 

But I think, on the other hand, when you look at the educational 

environment, and when we talk about mentoring and we talk about 

counseling, I think, both in our educational systems, secondary systems, but also at the university level, and then even more important, out in businesses, one of the things that I have seen that we 

have lost, and that is the whole concept—I will put it this way—

that businesses, companies, working with their individual employees in terms of career development,—there are exceptions out 

there, but because of layoffs, because of downsizing, because of 

those types of issues and the factors that have put so much pressure on companies to not focus on their people, I think, has been 

18

a detriment in terms of this educational focus, and I would argue 

that we need a return to that. We need to have a more personal 

touch in working with our people and helping them to develop and 

focus on their careers. 

Chairman MANZULLO. Congressman Franks? 

Mr. FRANKS. Thank you, Mr. Chairman, and thank you to the 

panel here. 

Secretary DeRocco, I know that a lot of times government’s approach is to find the need, to find the desired outcome, and to try 

to put our heads together and come up with the best strategies in 

the planning and training that we can to precipitate that outcome. 

I am remembering some experiences in state government, and one 

of the things was it seemed that we were basically reverse oriented 

at times, and by that, I mean that we studied the problem rather 

than the successes. 

And I am just wondering if there are any models that you are 

working on that, whatever the job necessities are, if you go and 

find the young people or the people that are successfully making 

transitions from another career or from, say, the loss of a job, to 

that new job, and they do everything that can possibly be done to 

not only amplify their success but to try to replicate their success 

and other people’s circumstances. Because it seems to me that with 

the economy, even as complex as it is, and with human behavior, 

as much more complex as that is, there is almost a genetic code 

to crack here. Certain behavior is kind of inborn and innate, and 

we would do far better spending time to try to cooperate with that 

and to try assist that, and I am just wondering, are there models 

to try to study successes, whether it is young people or whether it 

is veterans, or whoever that are successfully going into these new 

career opportunities and trying to replicate their successes? 

I was the Director of the Governor’s office for children in Arizona, and when we began to think that way, we had a great deal 

more success. We studied successful kids, and we found some very 

basic commonalities, and when we tried to cooperate and incent 

those qualities in others, we had a lot more success, and I am just 

wondering if that has any bearing here. 

Ms. DEROCCO. Hugely, and it is exactly what we are doing 

through the president’s High Growth Job Training Initiative. We 

are building on successes in communities where a partnership 

among employers with jobs and knowledge of what skill standards 

are needed for workers to be successful in those jobs partner with 

the educational institutions so that we can create the capacity to 

enlarge the training available to more workers in those partnerships with our public workforce investment system, which is the 

source of the human capital. 

We look for those partnerships. We are providing incentives 

through additional funds to grow those partnerships and to replicate them in other communities across the nation. We are also 

going to highly publicize, through a Web site for the workforce system for all educational institutions and for businesses across America, exactly how these partnerships are put together so that the investment of taxpayer dollars that is devolved through our state and 

local workforce investment partners can replicate these successes. 

19

So you are absolutely on point. This is the way we make sure 

that our system responds to success and does not get bogged down 

in failure. 

The other point I wanted to make is that the small amount of 

national dollars available to the Department of Labor in this devolved system for models and demonstrations nationally are specifically used to model successes in other areas of the country, and we 

have partnered workforce boards, which are the oversight bodies 

for our entire service delivery system, in areas where they are successful and meeting high employment retention and earnings gains 

goals, with workforce boards that have not quite gotten there yet, 

and this peer-to-peer sharing of successes that is now occurring is 

very exciting and having great results in building the capacity of 

the system, raising the bar for the whole system, and its contribution to making more happen for more workers and more businesses 

across America. 

Mr. LEWIS. If I may for the next 30 seconds, we, the Veterans 

Corporation, in the programs that we are starting in terms of 

training, entrepreneurial education, we are definitely looking at 

success models, both in terms of Robert Morris University in Pittsburgh and what we are trying to accomplish in Colorado as well 

as South Florida, and, in addition, a new concept called ‘‘community-based organizations,’’ where we have pilot tests going on in St. 

Louis as well as Pittsburgh. Both of those efforts, in terms of entrepreneurial education and community-based organizations, are 

going to provide us the successful templates to carry this throughout the country. 

Mr. FRANKS. Thank you, folks, and thank you, Mr. Chairman. 

Chairman MANZULLO. Mr. King? 

Mr. KING. Thank you, Mr. Chairman. I regret I was not here to 

hear the bulk of your testimony. However, I would reference in 

your written testimony, at least, Ms. DeRocco, you make reference 

to an increasing number of non-English speakers and that language skill is becoming a greater and greater problem. 

I am curious about this in a number of different ways, but one 

of them would be things that are brought to my attention, that we 

are having American citizens that are maybe second generation 

that are not picking up the language skills. Would you have any 

experience with that or any insight into that? 

Ms. DEROCCO. I know that that is true, and this is an area 

where we are building a strong partnership with the Department 

of Education and the Adult Education program because a significant percentage of individuals who are accessing the adult education programs around the country are second-generation Americans who still have language and literacy issues, and that is impacting their ability to access employment and career ladders. So 

we need a much stronger connection and much more effective programs. 

Mr. KING. Could you explain that phenomenon, how a person can 

be born in the United States and reach working age and not have 

English language skills to the point where it is difficult in the manufacturing process to communicate with someone who is a secondgeneration American? 

20

Ms. DEROCCO. I wish I could explain the phenomenon. You 

would think that our public education system, if the young people 

are moving through it, would have attained a level of language and 

literacy skills———. 

Chairman MANZULLO. Secretary, could you pull the mike a little 

bit closer? 

Ms. DEROCCO. Certainly. Absolutely. I am sorry. 

Chairman MANZULLO. Thank you. 

Ms. DEROCCO. This is an area where our educational system 

needs to focus far more dramatically. 

We also are making the Workforce Investment Act resources 

available for additional language and literacy training as opposed 

to vocational training because there is clearly a need in many sectors of the economy. 

Mr. KING. But I understand that with regard to people who come 

here without language skills. I am just going to say, I believe it is 

something far deeper in second-generation people who do not attain 

those skills. I am seeing Mr. Lewis with a little bit of animation 

on this, so I would like to hear from you, Mr. Lewis, on that. 

Mr. LEWIS. I have a very specific comment. I am the recipient of 

what comes from the secondary school system in my teaching in 

universities, and my comment overall is, frankly, I am appalled at 

the level of grammar and writing skills that I see in my classes. 

I emphasize a considerable amount of writing, and I just cannot 

use the word anymore than it is atrocious. 

We need to place more emphasis on going back to the basics of 

reading and writing and arithmetic. I hate to say that, but the ability to communicate, orally and written, is extremely important, and 

they have got to learn it at the beginning of their educational process because it is extremely important as you go all the way through 

the universities, through any types of training programs, and ultimately in business, and if you are going to be successful in business, you have got to be able to talk and write. 

Mr. KING. Would there be anything about the multicultural programs that we have in this country that you could identify that encourages development of English language skills? 

Ms. DEROCCO. Encourages development of. Actually, I was thinking, as my colleague was talking, that the emphasis in the past 

perhaps on English as a second language rather than English as 

a primary language is a problem that might have at least aggravated the situation that you have identified. I am not familiar with 

research on that topic. I would be glad to look into it. 

Mr. KING. Mr. Lewis? Does multiculturalism encourage English 

language skills or the development of those skills? 

Mr. LEWIS. Does it encourage it? From my experience in the educational environment, frankly, from a multicultural perspective, 

particularly for those students, and someone mentioned earlier in 

terms of that we are seeing a lot more students from other countries in our colleges and universities, and I have certainly experienced that in my areas, but, frankly, these students are some of 

the best, and, if anything, they add to the quality of education and 

the educational environment for what I will call our traditional 

U.S. students. So both in terms of the desire to learn, the desire 

to put the level of effort in to learning, yes, they may have, in 

21

terms of actual English skills, there may be some lacking there, 

but these people add tremendous value to that educational environment. 

Mr. KING. And, Mr. Lewis, I agree with that statement. My focus 

was more on the programs of multiculturalism themselves rather 

than the reaction of the students, and my sense of it is that as we 

roll out a multiculturalist agenda, we forget to promote the essential communications skills that make these people that come from 

all over the world successful in this country, and so I appreciate 

your insight into that point, and I thank the chairman. 

Chairman MANZULLO. Mr. King, thank you. I want to get on to 

the second panel. We could pick up the sociological aspects perhaps 

at a different time. 

I want to thank you for coming, and then we will impanel the 

second panel as soon as possible. Thank you. 

Mr. KING. Thank you, Mr. Chairman. 

[Pause.] 

Mr. BARTLETT. [Presiding] I believe our second panel is in place. 

Thank you all very much for coming. Dr. Beth Buehlmann, vice 

president and executive director of the U.S. Chamber of Commerce; 

Brian McCarthy, chief operating officer, Computer Technology Industry; Roger Joyce, vice president of engineering, National Association of Manufacturers; Dr. Ernst Volgenau, chairman and CEO, 

SRA International; Matthew Coffey, president and chief operating 

officer, National Tooling and Machining Association; Randolph 

Peers, vice president for economic development, Brooklyn Chamber 

of Commerce; and Michael Caslin, executive director and CEO, National Foundation for Teaching Entrepreneurship. 

You can proceed with your testimony in that order. All of your 

written testimony, without objection, will be made a part of the 

record. We would encourage you, if you can, to limit your remarks 

to five minutes. Rest assured that there will be more than ample 

time during the question period to amplify issues of particular interest to either you or members of Congress. Thank you very much 

for coming, and Dr. Buehlmann. 

STATEMENT OF BETH B. BUEHLMANN, U.S. CHAMBER OF 

COMMERCE 

Ms. BUEHLMANN. Good afternoon, Mr. Chairman, Congresswoman Velazquez, and members of the Committee. I am the vice 

president and executive director for the Center for Workforce Preparation, a nonprofit affiliate of the U.S. Chamber of Commerce, the 

world’s largest business federation, representing more than three 

million businesses and organizations. 

CWP is on the forefront of helping businesses, especially smalland medium-size businesses, in partnership with chambers across 

the country, find, use, and build resources to develop a skilled 

workforce and support productive workplaces. We are addressing a 

key employer concern, and that is finding, retaining, and advancing 

qualified workers. Over 90 percent of the businesses that are members of chambers are small and medium size, where the majority 

of job growth occurs and where you have asked me to focus the emphasis of my statement. 

22

My statement covers three points. First, in CWP surveys of 

small- and medium-size businesses conducted over the past three 

years, employers have reported difficulty in finding qualified workers due to lack of skills. In these same surveys, employers state 

that to remain competitive, they need qualified workers who can 

perform the job today and adapt to the demands of tomorrow, yet 

30 percent of these employers are concerned that the skills of their 

workforce are not going to keep pace. 

Consider that, in 1950, 80 percent of jobs were classified as unskilled and that now an estimated 85 percent of all jobs are classified as skilled. Most jobs now require some post-secondary education, but the growth in the number of workers with education beyond high school will only be one-seventh of what it grew between 

1980 and 2000. Many of tomorrow’s jobs do not exist today, but we 

know that they are going to require even greater skills and education. 

Second, we know that a significant number of entry-level workers 

are not equipped with the key skills they need to succeed in an increasingly complex and technological work environment. GAO and 

other researchers say that training and retraining programs are 

most successful when they prepare individuals for a specific, existing job. CWP, with state and local chambers, fosters collaborations 

between post-secondary institutions, employers, and the publicly 

funded workforce system. Many small- and medium-size businesses, however, do not have the human resources infrastructure 

to train their workers in- house. They are very dependent on resources in their communities. 

Chambers can connect small- and medium-size businesses to 

these resources and can aggregate the demand of local employers 

to leverage those resources. They bridge the gap between employers and workforce development providers and services, connecting 

businesses with the best programs to meet their needs. For smalland medium-size companies, this means that chambers can make 

the connections with training programs and services that these 

businesses find difficult to make on their own, in other words, serving as a strong, employer-led, workforce intermediary. 

Third, as we look ahead, employers and workers are going to 

place even greater reliance on levels of education to address the 

ever-increasing skill demands of a competitive American economy. 

Lifelong learning for working adults, K–12, and post-secondary 

education all play a specific role in preparing the present and next 

generation of workers for the challenges of the 21st century labor 

market. Knowledge is being outdated at rates that are escalating 

faster than ever before. For example, a bachelor’s degree in business now has a shelf life of just about five years. Clearly, providing 

continuing education opportunities for employees is no longer an 

option; it is a necessity to staying competitive. 

So what are some of the implications that can be drawn from 

what I have said? With 73 percent of all post-secondary education 

students being nontraditional students, in other words, working 

adults who are seeking additional education and training to return 

to the workforce, trying to remain current in their field, looking to 

increase their potential earnings, pursuing another job or even considering a career change in today’s demanding economy, the poliVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00026 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
23

cies that we have in place need to be examined in light of this 

growing need. 

We can no longer focus only on traditional students as we think 

about how employers and workers will learn, gain skills, and remain competitive. And with only 60 percent of ninth graders graduating, we need to strengthen our K–12 education pipeline, reduce 

dropout rates, require a rigorous and relevant high school curriculum, and align high school coursework with what is demanded 

of our students to enter college and the workforce. I tend to call 

this the ‘‘I don’t know/I don’t care phenomenon,’’ and I mention 

that in my testimony. Many of our graduates are prepared for neither college or the workforce. 

CWP, in partnership with local chambers, other workforce-development organizations, and our funders, has been instrumental in 

defining and demonstrating the unique role of local chambers in 

workforce development and education. My written testimony mentions a few examples of our work with partners such as the American Association of Community Colleges, Job Corps, the National 

Association of Manufacturers, and the Annie E. Casey Foundation. 

In conclusion, any meaningful strategy to combat the nation’s 

workforce challenges must be met with a comprehensive education 

and workforce development system. We are already attempting to 

improve our K–12 system. We must expand our services in the 

post-secondary education system to accommodate adult working 

students. In today’s and tomorrow’s global economy, lifetime learning has become mandatory and should be accessible, flexible, and 

convenient to help maintain America’s competitive workforce. 

I thank the Committee, and I look forward to your questions. 

[Ms. Buehlmann’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you. Mr. McCarthy? 

STATEMENT OF BRIAN A. McCARTHY, COMPUTER 

TECHNOLOGY INDUSTRY ASSOCIATION 

Mr. MCCARTHY. Mr. Chairman, members of the Committee, good 

afternoon and thank you for the opportunity to appear before you 

today. I am Brian McCarthy, the chief operating officer of the Computing Technology Industry Association, based in Oakbrook, Illinois. 

CompTIA represents more than 19,000 member companies in the 

IT industry, the majority of which are small-to-medium-sized enterprises. CompTIA is committed to fostering the growth of the IT industry by promoting industry standards, and growing professional 

IT expertise through training and certification, and developing relevant business solutions. CompTIA believes that we must promote 

public and private sector efforts to provide Americans with the 

tools they need to compete and succeed. Key among those tools is 

the acquisition of current and evolving IT skills, skills that are increasingly demanded in order to be successful in today’s economy. 

The changes wrought by IT on society are transforming the fundamental nature of the workforce. As global competition intensifies, 

the dependency on fluent and flexible IT skills will only grow. Not 

surprisingly, much of the demand for these skills will be for small 

businesses. According to the Department of Labor, around 92 perVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
24

cent of all IT professional workers are in non-IT companies, and 80 

percent of those professionals are working for small companies. 

We recently surveyed some of CompTIA’s small business partners to assess the challenges they face in training their workforce. 

We found that it is increasingly important for small IT businesses 

to equip employees with essential technical training in order to 

support their clients’ complex business systems. Small businesses 

are leaner and thus require highly skilled employees to perform 

multispecialized IT functions efficiently. Underlying this challenge 

is the cost of training. 

As a result, small businesses are forced to evaluate alternative 

means of training. To this end, CompTIA has developed specialized 

initiatives and public/private partnerships dedicated to IT training 

and certification across industry sectors. I would like to highlight 

some of these important training initiatives currently underway, 

the first of which is the National IT Apprenticeship System, or 

NIAS, jointly developed in partnership with the Department of 

Labor. 

The program places new workers under the direction of experienced IT professionals and provides a structured program for measuring practical skills and achievements, identifying weaknesses in 

skill gaps, and applying classroom and on-the-job training to addressing those gaps. Research studies performed by the Department of Labor and by CompTIA indicate that on-the-job training is 

much more effective when combined with classroom instruction 

than when delivered on its own. 

Key to the success of this program is partnering with community 

colleges, other educational institutions, and ultimately employers. 

CompTIA is also currently administering advanced technical skills 

training programs aimed at closing the skills gap in our nation’s 

IT workforce. Under these programs, nearly 2,700 American technology workers in 12 states will receive advanced IT job training 

in the coming months in programs administered by CompTIA. Each 

of these states shares a key characteristic in common: a projected 

long-term demand for IT professionals in high-skill, high-level positions. 

Policy initiatives and public/private partnerships such as these 

can be designed to buttress the underlying training and reskilling 

framework needed for U.S. IT-skilled workers today, but getting 

Americans primed for emerging job opportunities must be a central 

goal of U.S. policymakers as well as the private sector. While many 

of these jobs will require a four-year degree, an increasing number 

of these positions can be filled by graduates of vocational schools 

and community colleges, as well as through the apprenticeship programs. In this regard, professional certification becomes an ongoing 

validation across all of these programs. It provides credibility, recognition of achievement, validation of technical expertise, and quality assurance. 

Tremendous possibilities abound for Congress to help American 

IT workers to adapt to broader, IC-centric changes moving through 

the global economy. For example, programs provided through the 

Workforce Investment Act and the Perkins Act are extremely valuable. Additionally, early education programs which nurture a 

child’s interest and achievement in math and science are essential 

25

to filling future demands for America’s tech workers and should be 

fully funded. Promoting capital investment in R&D are also key 

elements of a growth agenda. Just last week, H.R. 4392, the Technology Retraining and Investment Now Act, or TRAIN, was introduced, which provided a tax credit for IT training. Policies such as 

these will be especially helpful to small businesses, many of whom 

are faced with substantial hurdles to remain competitive. 

America must have a fluid and flexible work force. That is the 

end goal here. When this can happen, workers can have the tools 

to remain employed and employable, and companies have the 

human resources to meet global consumer demand and creating 

jobs here at home. 

Mr. Chairman, I would like to than you for the opportunity to 

testify today, and we at CompTIA, our members and staff, stand 

ready to help Congress understand further the dynamics at play in 

the U.S. and global economy, especially as they relate to the maintenance and upgrade of IT skills in the U.S. workforce. Thank you. 

[Mr. McCarthy’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you very much. Mr. Joyce? 

STATEMENT OF ROGER JOYCE, NATIONAL ASSOCIATION OF 

MANUFACTURERS 

Mr. JOYCE. Thank you, Mr. Vice Chairman. I am Roger Joyce. I 

am vice president of engineering at the Bilco Company, a small 

family business started in 1926 by my grandfather, George W. 

Lyons, Sr. 

We are manufacturers of architectural-access products, with 200 

employees in facilities in West Haven, Connecticut; Truman, Arkansas; and Santa Teresa, New Mexico. We are a member of the 

National Association of Manufacturers, the nation’s oldest and 

largest industrial trade association, representing 14,000 member 

companies and 350 member associations serving manufacturers 

and employees in every industrial sector in all 50 states. Approximately 10,000 of NAM’s members are small- and medium-sized 

manufacturers, of which we are one. I am also vice chair of CBIA, 

the Connecticut Business and Industry Association, one of NAM’s 

statewide affiliate members. 

I thank you for this opportunity to discuss the importance of a 

strong manufacturing workforce to our country and the workforce 

challenges that today threaten our competitive leadership in manufacturing. 

A year ago, manufacturers were struggling through one of the 

toughest business climates in recent memory. In order to stay competitive, they tightened their belts on things like capital equipment 

spending, expansion plans, and hiring and training employees. Interestingly, this may sound somewhat counterintuitive. Oftentimes, 

the slow periods are the best times to up-skill workers. When facilities do not have to operate 24/7, it is much easier and more cost 

effective to take people off the line for training. And yet there are 

still skill shortages in manufacturing, the recent downsizing of two 

million manufacturing jobs notwithstanding. 

Skill shortages remain, and here is why. First, consider the unavoidable demographics of the labor force. The boomer generation, 

in every field, from teachers to machinists, are starting to retire. 

26

According to one major corporate vice president, the average age of 

their firm’s highly skilled, highly paid machinists is 58 years’ old, 

and there is no pipeline of replacements. 

Second, the march of advanced technology is infusing old industrial sectors, like mine, while creating new ones, raising skills requirements throughout the economy and creating serious skill gaps 

in the labor force. 

Third, firms already struggling with these two challenges confront a continuously globalizing economy where competition is intensifying on capabilities as well as cost. 

Fourth, young people today do not see manufacturing as a viable 

career opportunity. Changing the perception of manufacturing will 

require aggressive marketing of manufacturing opportunities to potential new entrants to the workforce who must have the requisite 

math, science, and literacy skills needed in today’s manufacturing 

environment. 

The recent upturn in the economy changes none of this. In fact, 

as conditions improve, more job opportunities requiring higher skill 

levels will be created. 

All four of these conditions center on the skills of the labor force, 

which needs systematic upgrading and expansion. This argues for 

a new policy approach to workforce development, especially during 

a recession when hundreds of thousands are idled, many of whose 

basic education and skills are inadequate or at risk in modern 

manufacturing. 

One approach is to turn downtime into training time, something 

some of our European colleagues have done for decades. In our 

business, we use this time to train our employees in the principles 

of lean manufacturing. As a result, even though business activity 

will rise and fall, we become a stronger competitor. 

Until now, human resource policymakers have seen recessions as 

storms to be weathered. The labor force policy response was mainly 

income and benefit maintenance and maybe some relocation assistance. That has been the status quo, and we cannot afford to maintain the status quo. This is not about just fixing the unemployment 

system. The issues at stake will lead to a declining economy if we 

constrict ourselves with antiquated systems. We need to ratchet up 

our skills base now. 

We need to make the public workforce system more employer 

friendly. Supporting the 1998 Workforce Investment Act will help 

us more effectively match labor market demands with labor market 

supply. The current administration has made great strides in creating a ‘‘dual-customer’’ system, but we need to sharpen the focus 

because too few employers know the system even exists, or when 

they do, it falls short of meeting their needs for skilled and jobready workers. As effective as the Workforce Investment Act has 

been, we are disappointed that funding has been reduced 10 percent and urge review of this critical area. 

One strategy NAM and the U.S. Chamber have successfully employed, in partnership with foundations and the U.S. Department 

of Labor, has been to work through their employer-intermediary organizations. In particular, business and trade associations are 

highly effective organizations for small business, allowing our 

voices to be heard and providing opportunities for us to participate 

27

in the employment and training system that often are only available to large corporations. 

One example of this is the three-year, $2.2 million, U.S. DOL 

demonstration grant for incumbent and dislocated workers, which 

CBIA received in 2002 to assist manufacturers with job training. 

Despite the recession and loss of manufacturing jobs in Connecticut, CBIA, working with both community colleges and private 

contractors, was able to provide training assistance to 23 companies, train over a thousand employees who took 126 courses in 60 

different training areas. Courses in lean manufacturing, Six Sigma, 

supervisory training, teamwork, blueprint reading, CNC machining, and laser and fuel cell technology, as well as English as a second language, were made available to employees through this federal grant program. Participants in this program were better prepared for their current jobs and able to move more effectively into 

higher level positions. 

Unfortunately, it is my understanding that this demonstration 

grant program has been eliminated. As a result, after June 30, 

when this grant is completed, CBIA will no longer be able to assist 

manufacturers in a way that works so effectively for us. We feel 

that such programs should be restored and, indeed, expanded. 

We need to support our community college system. The president 

has made it clear that he does. Community colleges are the backbone of the worker education and training system, and we need to 

increase our investment in our communities by supporting their 

growth and connection to their local employers. Gateway Community College serves the greater New Haven business community by 

developing programs that address our specific requirements, even 

employer by employer, if necessary. 

We also need to ensure that our citizens have the financial aid 

they need to get access to post-secondary education that will give 

them good jobs and family-supporting wages. We need action on 

the Higher Education Act to ensure that access to funds is streamlined and available when needed, and we certainly need to 

strengthen the ties between higher education and the workforce 

needs of business. 

The Bilco Company is a small manufacturer, but we compete in 

the world marketplace. Ten years ago, we sold our products in five 

countries. Today, we sell in 65 countries. Our workforce must be 

at least as skilled as our competitors’ in other countries, but we are 

losing this battle. The Department of Labor estimates that the skill 

shortage I have described will affect 10 million workers by the year 

2010. 

A new program in Connecticut is starting to make a difference. 

We actively support the Connecticut State Scholars pilot program 

in New Haven. This program connects the school district with business to encourage eighth graders to choose a more rigorous curriculum in high school. Upon completion of this program, they are 

in a much better position to enter the workforce, the military, or 

pursue higher education opportunities. This means they are better 

able to compete with their peers around the world. 

I encourage the Committee to support the initiatives I have presented so that manufacturers like myself are in a position to compete, to grow, and to create new jobs. I thank you. 

28

[Mr. Joyce’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you. Mr. Joyce, does your company make 

the outside-access door for basements? 

Mr. JOYCE. Yes, we do. That is the world-famous, Bilco basement 

door. 

Mr. BARTLETT. It is, indeed. I would just like to note that when 

I was growing up that more people referred to the refrigerator as 

the ‘‘Frigidaire’’ because the Frigidaire had so dominated that market, and when you were going to buy an outside, basement-access 

door, you were going to buy a Bilco door, no matter who made it, 

because you have so dominated the market in quality and recognition. 

Mr. JOYCE. Yes. Thank you, Mr. Chairman. My grandfather invented that product in the backyard shop, and it really was the 

genesis of our company, and it is a model of ingenuity, of entrepreneurship, that we still follow today. Thank you. 

Mr. BARTLETT. And you are selling it in 65 countries today. Congratulations. Thank you. Thank you. 

Mr. Volgenau? 

STATEMENT OF ERNST VOLGENAU, SRA INTERNATIONAL 

Mr. VOLGENAU. Mr. Chairman and members of the Committee, 

my name is Ernst Volgenau. I am chairman and CEO of SRA 

International, and I am representing the Information Technology 

Association of America, where I am chairman of the Workforce 

Education Committee. 

The Information Technology Association of America is a leading 

trade association for the information technology industry. ITAA has 

380 members, and SRA International is one of them. ITAA member 

companies represent a broad spectrum of industry sectors: computer software and services, e-commerce, enterprise systems, 

broadband communications, and other areas. ITAA represents companies of all sizes, from large, multibillion-dollar enterprises to 

small, entrepreneurial firms. 

I appreciate the Committee’s interest in small business. I know 

what it is like to be part of a small company. I started SRA International in the basement of my home in 1978. Today, SRA International is an information technology consulting and system-integration company having revenue of about $600 million and about 

3,300 employees. We have been on the Fortune magazine list of 

best places to work in America for five years in a row. Last year, 

SRA devoted about 65 percent of its subcontracting dollars to small 

businesses, and we try to treat each with fairness and respect. 

We very much appreciate this Committee’s support for worker 

training, which is essential to the economic health and vitality of 

our country. The increasing emphasis on information technology 

has produced fundamental changes in the skills and work performed by the average American. As the U.S. shifted from a domestic, industrial economy to a global information economy, our workforce has changed, too. Many workers are concerned about how 

global sourcing, sometimes referred to as ‘‘offshore outsourcing,’’ 

will affect their jobs. A recent study by ITAA and Global Insight 

shows that offshore outsourcing causes the entire U.S. economy to 

29

perform at a higher level and actually produces a net gain in jobs 

and wages over time. 

Regardless of global sourcing, the American IT industry is still 

the world’s leader, and that is not going to change anytime soon. 

However, the global marketplace for IT is becoming more competitive. Americans must recognize this and adapt to a changing economic environment through education, training, and retraining. 

Small businesses play a key role in ensuring our high-technology 

strength. They provide technology innovation, entrepreneurial vitality, and entry points for many seeking IT jobs. Small businesses 

generally hire workers from local communities and so have a major 

stake in ensuring that these individuals are adequately educated 

and trained. Education and training of American workers are essential in this increasingly competitive world. U.S. high-tech leadership is significantly aided by the nation’s robust education and 

training infrastructure, institutions of higher learning, community 

colleges, private technical colleges, e-learning certification programs. All of these make contributions. 

In view of this, ITAA has four basic recommendations or observations. First, industry and the federal government should strengthen partnerships and better identify local training needs. For example, local workforce investment boards are building partnerships 

involving employers, community colleges, and other community organizations. Community technology centers in economically disadvantaged communities give people hands-on access to technology. 

These centers should be considered for use as a possible model to 

disseminate entry-level training. 

Second, companies must be aware of training resources available 

through various workforce-development programs. Businesses, particularly small businesses, should participate more actively through 

state and local workforce boards and government one-stop centers 

so that the communication loop is closed between those who provide training and those who need appropriately trained employees. 

Third, the American Society for Training and Development, 

ASTD, is a leading association of workplace learning professionals. 

ASTD notes, in their state-of-the industry report, that the technology sector spends more on IT training than any other sector surveyed. IT companies have developed innovative approaches to the 

use of e-learning and delivering workforce training. 

Fourth, the government should revise its education and training 

policy to help build the competitive advantage of small businesses. 

Now, ITAA has a number of recommendations here ranging from 

the H1-B training fund to No Child Left Behind, but in the interest 

of time, I am going to just refer you to the written testimony and 

say, in conclusion, that America’s future clearly depends on the 

availability of an educated and trained IT workforce. Government, 

industry, academia, and individual workers share a common purpose and must work together to produce a high-tech workforce that 

meets the demands of the new century. Thank you. 

[Mr. Volgenau’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you. Mr. Coffey? 

30

STATEMENT OF MATTHEW B. COFFEY, NATIONAL TOOLING 

AND MACHINING ASSOCIATION 

Mr. COFFEY. Thank you, Mr. Vice Chairman. Ladies and gentle- men, as the eighth witness on this single subject, my challenge is 

not a problem of knowing what to say; it is how to make it interesting to you. You have my written statement, and what I would 

like to do really, then, is just reflect on some of the fundamentals, 

as I see them. 

As you know, I represent the tool, die, precision machining, spe- cial machine-building industry in the United States, a trade association that has been around for 61 years, focused on education and 

training as its principal purpose. We have been dealing with the 

federal system of training and education for that entire period of 

time, and there is a certain point at which you say, when you look 

across the spectrum of federal programs and see 175 or 178 programs in this area, never has so much money and effort gone into 

produce so little result because we do not really see a major improvement in the quality of the applicants showing up at the door 

of the company. Human resources, of course, in any manufacturing company rep- resent the competitive advantage, and in the present manufacturing environment, of course, the biggest single thing that you 

need to have is pricing power, and that is only available to you in 

this kind of a market where you have innovation, and innovation 

only comes from highly educated people thinking about the solution 

of customers’ problems. 

We, at the same time, are experiencing a tremendous demand for continuing education, for continual learning on the part of the incumbent workforce while most federal programs are focused on 

entry level or focused on creating new entrants into the industry 

as opposed to upgrading the skills of those presently in the industry. 

Now, small, high-tech companies carry a heavy training expense 

burden. There is no question about it, and they have been doing 

it for years. Their competitors around the world do not have that 

same burden. They wind up having educational systems that make 

skills training mandatory from kindergarten through college and 

do not give students the option of one track or the other. I think, 

fundamentally, in education policy, we made a mistake when we 

divided those two, and in dividing them, we created a problem 

which we are living with at this point in time. 

The federal government, until 1993, when it got into the block 

grant programs, supported industry-specific training, but once it 

went into block grant programs, sent the money to the states under 

formulas, the states wound up using that training money to attract 

foreign investment instead of training incumbent workforce or 

training people at the entry level. 

So we have got a system that has not worked too well and that 

is designed for academic achievement, not mechanical skill, and as 

a result, as you heard earlier, more than 50 percent of applicants 

show up deficient in one way or the other, not knowing math, not 

knowing science, not knowing some of the skills that we need in 

our particular manufacturing industry. And the one truth that I 

think most people will come to is that technology is only as good 

31

as the user. You can have a very sophisticated computer sitting in 

front of you or a very sophisticated machine tool. If you do not 

know how to use it, then, you have wasted your money on the technology. So software and hardware technology are changing all the 

time, and workers need to be changing with them, need to be learning, need to be upgrading their skills. 

I really think it is time to change the federal approach, and I 

think we are working very hard as an organization to try to do 

that. I think we do need to think about once again having national 

training programs that are industry specific, picking those industries where we see the opportunity for continuing innovation and 

development and having specific national programs that lead in 

that direction. 

We have been talking for years about tax credits for small- and 

medium-sized businesses to ensure that they will invest in training. We have been unable to get very much support for that at any 

level of government here at all, but it is a real necessity. 

Third, I think we need to support changing the training infrastructure. We need to use the technology available to us to deliver 

material to people where they are, when they need it, what they 

need. That says that we need to use distance learning, we need to 

use it effectively, and we need to break away from the patterns of 

the old system, the old structure. 

And, finally, I think we need to have better federal program coordination. We have all of these programs. We have no one coordinating the efforts and the activities, and whether you are talking 

about the DOL or the DOC or the DOE or the TAA program or the 

MEP program or any of the programs that were talked about earlier, they are all little, narrow smokestacks that do not work together, that do not effectively deliver a product to the manufacturing company, and that is the great frustration. 

So I think we have a lot of work cut out for us. I appreciate the 

interest of the Committee in this subject. It is a subject I have been 

working on for 25 years of my career and one in which I would 

hope that we can start a process that does start to solve some of 

the problems that we face in manufacturing. Thank you. 

[Mr. Coffey’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you very much. Mr. Peers? 

STATEMENT OF RANDOLPH PEERS, BROOKLYN CHAMBER OF 

COMMERCE 

Mr. PEERS. Good afternoon. My name is Randolph Peers, and I 

am the vice president for economic development at the Brooklyn 

Chamber of Commerce, and that is Brooklyn, New York. I want to 

thank the chairman, Congresswoman Velazquez, and the rest of 

the Committee for having me here testifying today. 

Just a little background on Brooklyn. Brooklyn is the most populous of New York City’s five boroughs, with a population of two and 

a half million people and over 36,000 businesses. The majority of 

these businesses, some 67 percent, employ between one and four 

workers, making Brooklyn home to a true small business economy. 

In my testimony today, I would like to share with you the small 

business perspective as it relates to issues of education, training, 

and workforce development based on the Brooklyn chamber’s seven 

32

years of direct involvement in providing workforce services to its 

membership. 

In May of 2004, the Brooklyn Chamber of Commerce released the 

results of a comprehensive, labor market review it conducted with 

support from the U.S. Chamber of Commerce’s Center for Workforce Preparation. While I will not bore you with industry specifics 

about Brooklyn, I do want to touch upon the statistics with respect 

to recruitment and training by small businesses. 

Forty-two percent of Brooklyn businesses indicated a willingness 

to hire additional workers this year, up from 20 percent that actually did hire last year. That is a good thing. Of those businesses 

that did hire additional workers in 2003, 32 percent indicated that 

they had a significant problem recruiting skilled or professional 

employees. Of those organizations planning to hire, small businesses struggled the most with recruiting skilled and professional 

labor, including supervisory employees. 

While 82 percent of businesses overall indicated that they provide some sort of worker training, the majority, 66 percent, identified the training as informal and on the job. The number of small 

businesses indicating that they provide informal, on-the-job training jumped to 82 percent. 

Brooklyn businesses were evenly split over the importance of a 

college degree, with 49 percent indicating that a degree was important or very important. Small businesses seemed to value the degree least, with only 38 percent indicating a degree was important. 

And, finally, only a small minority of businesses of all classifications turned to the publicly funded workforce-development system 

for either recruitment or training assistance. Predictably, small 

businesses were least likely to utilize the system. 

The statistics contained in this labor market review give us a 

snapshot of a predominantly small business economy in transition. 

On the positive side, there were signs of emerging new sectors in 

the economy in finance, insurance, real estate, construction, and 

tourism. These jobs will require higher skills while offering more 

career-ladder opportunities for residents. 

By contrast, however, many of the existing businesses are experiencing several obstacles to recruitment and training, especially 

amongst the skilled professions. Additionally, a majority of these 

same businesses are small- and mid-sized companies, representing 

a myriad of obstacles that prevent them from taking advantage of 

the public workforce system and its resources. 

In many cases, an absence of a formal human resources department or a basic lack of capacity to deal with workforce issues represents the most significant challenge. Small businesses tend to 

focus more on immediate, bottom-line issues, not recognizing the 

impact of staffing, training, or employee-retention issues and the 

effects that they can have over the long haul. In other cases, it was 

simply a lack of awareness that prevents businesses from taking 

advantage of the public workforce-development system. 

Lastly, many small businesses have ambivalence towards working with what they perceive as a government-run program that appears too bureaucratic or too social services oriented. 

Since 1998, the Brooklyn Chamber of Commerce has operated a 

successful staffing service for small business. This program, called 

33

Good Help, has been at the forefront of providing various workforce-development services to the small business community by acting as an intermediary between such companies and the public 

workforce system and acting as a partner in the public workforce 

system. For small businesses, the advantage in such a service can 

be many. For many businesses that lack a human resource capacity, the chamber can provide the expertise to fill the void. 

In addition, these businesses are already working with the chamber of commerce in other ways, and the comfort of working with an 

established relationship increases the likelihood that the smaller 

employer will see the benefit in such programs and, over time, will 

access other publicly funded, workforce-development services. 

But while it is clear that business intermediaries can play an effective role in any workforce system, we must also acknowledge the 

need to create better synergy between economic development and 

workforce development. It is my belief that without greater integration, the success of any workforce-development initiative, including 

training initiatives, will be limited. 

To a certain degree, through industry-specific training initiatives, 

many cities are beginning to create this coordination, but we must 

be mindful that such large-scale training initiatives tend to benefit 

larger businesses that bring many jobs to the table. It is also important to recognize that small businesses, even in similar industries, have differing needs as opposed to larger companies when it 

comes to worker training. 

Whereas larger companies may be looking for higher-tech training as a means to increase worker proficiency in a particular field 

or on a particular piece of machinery, small companies tend to have 

more elementary training needs. Adult basic education, English 

language skills, critical thinking abilities, and soft skills proficiency 

are more likely to be cited by a small business as a training need. 

We also would like to point out that small businesses are more 

likely to hire lesser-skilled workers because they cannot compete 

with larger businesses with respect to wages and benefits. Therefore, the need for incumbent worker training that leads to careerladder opportunities geared towards basic skills is critical for the 

long-term success of both the employer and the employee. 

Also, smaller businesses in well-established industries need a 

more generic basket of services that includes basic business assistance not directly related to workforce development. Such services 

include help with financing issues, basic business planning, access 

to information on nonworkforce-related incentive programs, marketing and promotion assistance, access to procurement opportunities, guidance on technology issues, and basic technical assistance 

related to compliance matters. It is through this type of basic development support that smaller companies become mid-sized companies and ultimately employ more workers. In these cases, the 

road to increased WIA outcomes is long and winding. 

On a system-wide level, more cities and states are examining 

ways to create better synergy between workforce development and 

economic development. In New York City, for example, last year, 

the Department of Employment was merged into the Department 

of Small Business Services. In Idaho, Governor Dirk Kempthorne 

34

recently announced the state’s intention to merge its labor department and its department of commerce. 

In conclusion, government should play a powerful role in helping 

to foster greater integration between economic and workforce development beyond what is promoted through existing WIA legislation. 

Such integration will, in the long run, help not only large businesses, but will also empower smaller businesses to grow and become more competitive. In this process, small businesses will take 

advantage of workforce development and training services. Increased awareness and participation by small businesses in the 

workforce-development system will help to make the system more 

responsive to business needs and more in step with industry 

trends. 

Some suggestions for promoting a business-driven system that is 

more responsive to small businesses include: number one, encouraging policies that foster greater collaboration between business, 

education, workforce training providers, and the public workforcedevelopment system; two, encourage policies that integrate workforce and economic development; three, create ways to promote and 

encourage the inclusion of intermediaries like chambers of commerce and trade associations in the marketing and delivery of 

workforce services as partners in the system; four, through WIA, 

mandate specific business services outcomes, not just job-seeker 

outcomes, in an effort to make the system more accountable; number five, expand opportunities and lift restrictions on incumbent 

worker training programs to allow for a wider range of training options; number six, allow WIA funds to be used for limited economicdevelopment activities, create new tax incentives and wage-subsidy 

programs that promote new job creation as well as job retention 

during economic recessions; and, finally, support efforts to increase 

local labor market information designed to predict industry and 

business trends. Thank you. 

[Mr. Peers’ statement may be found in the appendix.] 

Mr. BARTLETT. Thank you very much. Mr. Caslin? 

STATEMENT OF MICHAEL J. CASLIN, NATIONAL FOUNDATION 

FOR TEACHING ENTREPRENEURSHIP 

Mr. CASLIN. Thank you. The title of my presentation is ‘‘Where 

Will Our Next Generation of Entrepreneurs, Our Next Generation 

of National Wealth Creators and Manufacturers Come From: A 

Call to Action for the Development of an Entrepreneurial Culture 

for All Americans.’’

I have been CEO of NFTE, the National Foundation for Teaching 

Entrepreneurship, for 16 years. NFTE is a New York City-based, 

globally focused, entrepreneurship education foundation. The testimony I have submitted is 34 pages, which reflects our thinking 

over the past 16 years of working in the most impoverished communities in the world, with multigeneration, unemployed families, 

and how to improve their plight. 

I am touched by Chairman Manzullo’s approach to getting to 

know the people who testify here today. I wanted to share with you 

my background. I am a grandson of a Gaelic-speaking, immigrant 

farmer who escaped poverty from Ireland, who came to the United 

States, and the one job he could get was as a mucker for the New 

35

York City police force stables. He died digging by hand the 34th 

Street tunnel of New York City. 

My grandmother and mother survived on widow’s assistance and 

welfare and family support, and my mother worked throughout 

high school to support her mom and herself, and even at the young 

age of 75 years today, works every day. 

I am a son of a proud union steamfitter and photo engraver. I 

am a first-generation entrepreneur, a first-generation college graduate, with two sons currently enrolled in college, each of whom 

have their own business, and a teen daughter who is college bound, 

and she also has her own business. Growing up, when I went to 

school, it was be good, do good in school, and someone will give you 

a job. No one said you could create your own job. While I worked 

17 jobs from the time I was nine, I did not know I was a microentrepreneur. I knew I had to work to earn money. 

My children and NFTE children know the difference between a 

job and creating a job and being an entrepreneur. For the last 16 

years, NFTE has championed entrepreneurship education for 

America’s low-income teens and young adults, especially for African-American and Latino youth. We have seen firsthand in programs in Brooklyn, New York City, Baltimore, Chicago, Arizona, 

New Mexico, First Nations, Toledo, Ohio, tremendous entrepreneurial potential. The issue is not only to attract bright and young 

people to this economy that is changing but also to unleash the talent of many young people who are turned off to life right now. 

If you go into many schools across the country, and you mention 

IT opportunity, you will have blank stares. Very few of them are 

aware of what ‘‘IT’’ means, and very few of them are enabled to 

pursue opportunity in the IT field in any way, shape, or form. We 

have found that over 60 to 70 percent of our students have never 

been inside a bank, so their knowledge of financial literacy and formal banking processes is very limited. Eighty percent of our students who form their own businesses are first-generation entrepreneurs, and I ask the Committee to consider that the motivation, 

why are we engaged, why we should learn this, is something that 

must be looked at in addition to the skills that are needed. 

We have seen all across the world the demand for the NFTE program, and that demand is really in the form of American business 

English and American entrepreneurship as a second language. 

There is a tremendous motivation to understand the code and the 

culture of entrepreneurship. 

As a lecturer at Harvard Business School and Stanford Graduate 

School of Business, Dartmouth—School, Duke, and an adjunct professor at Manhattanville College and also Babson on entrepreneurship and philanthropy, I can tell you firsthand that the code of 

wealth creation is not getting out. The understanding of how to 

participate in this economy is not getting out. 

We have seen, over time, young people, ages 11 to 18, become 

more economically productive members by learning the entrepreneurial process. Our strategy is to partner with schools, universities, and unleash experiential curricula, train and support youth 

workers. 

N.F.T.E. started as a ‘dropout‘-prevention program, and we are 

now positioned as a turn-on program in school districts across the 

36

country, as well as in partnership with a number of communitybased organizations, and it is our opinion that ownership and ownership attitude and ownership perspective is also one of the most 

ultimate technologies that could be promoted. 

The state of being literate in entrepreneurship really brings with 

it a joy and a value and a creativity and understanding of the 

wealth-creation process. Young people can begin to see how they fit 

in the macro and micro-economic production structure, the value 

chain, where they can contribute, and how they can help the nation. We can and must promote this awareness for all Americans, 

especially our youth, especially those living in poverty today. 

I am honored to represent NFTE today because this is the month 

where we will have graduated our one-hundred-thousandth young 

entrepreneur. It is a very special time for us. We started, again, in 

a single site in Fort Apache in the south Bronx as a dropout-prevention program. 

How did we do it? We did it with the private sector help. We 

have had a coalition of over 500 private sector sponsors, including 

Goldman Sachs and Microsoft. Microsoft helped NFTE create the 

first entrepreneurship learning system in the world on the Internet 

for teens and young adults. The Shelby Davis Foundation, 

NASDAQ, the Sandberg Foundation, Weinberg and Atlantic Philanthropies. Atlantic Philanthropies’ Charles Feehey, the founder of 

Duty Free Shops, has taken an idea, created $3 billion in value, 

and is now giving it back to help disadvantaged youth in Ireland, 

the U.S., and South Africa. 

In addition, the U.S. SBA, the U.S. Department of Education, 

and cabinet-level members—Secretary Evans, Secretary Paige, and 

Secretary Chao—have all been to see NFTE in action. 

One of our leverages is to use university partners. We partner 

with Babson College, Carnegie Mellon, Georgetown, Northwestern, 

Stanford, Yale, and Columbia. We do that in order to get their code 

of wealth creation. We have identified, in working with them, 1,400 

key concepts, behaviors, and practices of entrepreneurship that 

most adults and most young people are never exposed to. 

Our mission as a charity is to bring that code of the 

businesshood, the code of wealth creation, out so that young people 

can get turned on. We are experiencing this not only in the United 

States, where we have teachers now certified in 46 states, but we 

are also active in the U.K., Holland, Belgium, Germany, and Ireland, India, Argentina, countries in Africa, Latin America, and 

China. It seems that globally entrepreneurship is one of the fastest-growing languages in demand. 

Our long-term objective is to enable each low-income American 

worker and first-generation business owner to be sparked with the 

powerful knowledge of entrepreneurship and to help ignite what 

Policy Analyst Mike Novak refers to as ‘‘the fire of invention,’’ get 

people turned on. 

We have hope here at NFTE. We see dropouts every day. We 

know that they are heading for a state of despair, not to a career. 

Why are they giving up the American dream? We spend many, 

many hours with them trying to understand that. Oftentimes, it is 

because no one is showing them how to dream it and how to 

achieve it, and many do not believe it exists. Even within miles of 

37

this hearing room, we have programs in Anacostia High School 

where many young people just do not believe the American dream 

exists for them. 

What can we do? Well, we have to work together through more 

effective public policy, more innovative education curriculum, higher demands of our citizens. We have hope because we have conducted seven major research evaluations on the impact of teaching 

entrepreneurship to young people. We work with Harvard, Brandeis, Columbia, and Babson College Center for Entrepreneurship. 

We have been able to show that occupational aspirations have increased because of viewing the world as an entrepreneur. We have 

been able to show that independent reading, self-motivated reading, occurs once a student gets turned on to the possibilities of entrepreneurship. We have also been able to show that Latino youth 

become more engaged and stay more engaged in school as they 

learn how to not only earn money for their families as well as see 

the value of school and why they are there. 

We had a comment from Dr. Andrew Hahn of Brandeis University: ‘‘NFTE succeeds in teaching the skills and knowledge that are 

important to helping prepare young Americans for careers in business ownership.’’ We have been able to prove the entrepreneurship 

knowledge increases by 20 times. Actual business activity rates increase by 30 times the amount, and in our conversations today, we 

are able to make sure that our young people understand that there 

are four types of business in the economy today: wholesale, retail, 

service, and manufacturing. Being able to understand just that one 

element and how you can fit and how you can flow between those 

four areas is mission critical. 

While we have grown from a single school in the south Bronx 

near Yankee Stadium to truly a global movement, we also know 

that to be competitive in our world economy in the future, we must 

create it today over the next decade. Manufacturing is a key part, 

and young people can pursue careers as entrepreneurs in all types 

of businesses. 

It is our founding premise as a nation that the essence of a 

democratic capitalistic society lies squarely on the shoulders of 

each generation of productive, responsible, and business-competent 

Americans. We can never take this for granted. We can work together. We can create a greater strength and a greater competitive 

position for our country, and we will see it in the face of our children. Greatness can exist again in many cities where it is fading. 

We look forward to working with the members of Congress here to 

assure that, and we are ready to stand with you. Thank you very 

much. 

[Mr. Caslin’s statement may be found in the appendix.] 

Mr. BARTLETT. Thank you and thank you all very much for your 

testimony. Ms. Velazquez? 

Ms. VELAZQUEZ. Thank you for your testimony. This has really 

been quite helpful to us, and we know that we need to do better 

in terms of putting a comprehensive approach in the area of training, retraining, and helping small businesses. 

Mr. Coffey, you mentioned that there are so many training programs throughout the federal government, and we all know that 

they exist in the books, but one thing is the number of 140; the 

38

other thing is that some, more than one third, have either been flat 

funded or their funds have been cut. We have an example here of 

a pilot grant program in Connecticut that has been working beautifully, and yet at the end of your grant, that program is going to 

be zeroed out. 

So what we need to do is really if we want to continue to be competitive and create the meaningful jobs that we need, we have to 

identify those programs that really can help provide the tools and 

the training that will enable small businesses to be able not only 

to hire but to keep those workers. 

Another area is how can we help small businesses in the area of 

training and retaining those workers? We work together FREA, 

and I worked with Chairman Talent, who passed that legislation 

that will provide tax credits to small businesses for workers’ retraining and training, and yet nothing happened. Has there been 

any discussion in terms of that legislation? 

Mr. COFFEY. The latest discussions I have had have been with 

Senator Collins on the Senate side, who did attempt to put a tax 

credit type of provision into the Foreign Sales Corporation 

extraterritorial income bill, and she has now been joined by Senator Reed from Rhode Island as well in trying to put a bill together 

that would possibly be introduced in this session. Obviously, we 

have not introduced anything on this side, and we have gotten no 

response out of the administration to this idea. 

The nice thing about it is that what you are asking for is an incentive to get employers to engage in the expenditure necessary to 

train people. You are not asking for the federal government to pay 

for the whole thing; you are asking for them to give them a tax 

credit that is probably a tenth to a third of the cost of what they 

would actually expend in the training. I look forward, if we can 

start to build some momentum, to work with you again to try to 

get this legislation moving. 

Ms. VELAZQUEZ. The other thing is the Trade Adjustment Assistance program and the Manufacturing Extension program, both of 

which you mentioned in your testimony, that really are an example 

of programs that can get training and education to places where we 

need it the most, and they have proven to be effective, yet on this 

budget, Fiscal Year 2005, they are slated to be cut. 

So it seems to me that there is a disconnect between what is 

going on in this country in terms of our economy and small businesses as job creators and the tools that we need to provide, and 

there is a role for the federal government to play in helping small 

businesses. 

I would like to ask Mr. Peers and Mr. Caslin and Mr. Joyce, I 

know that in your program you provide English as a second language. In your experience, Mr. Caslin, do you feel that Latino 

youth, they are not willing, or they resist integrating, learning 

English as a second language? 

Mr. CASLIN. No. I think that they want to see a way to pace 

themselves in to get connected, some type of process. We see the 

motivation there, and there is also an engagement strategy that 

once the students start to understand some of the concepts, the motivation to possibly read more increases without question. 

39

Ms. VELAZQUEZ. We just called New York City, the department 

of education, and we asked for the number of applicants that are 

on a waiting list, and they are telling us 90 percent of all applicants are on a waiting list in New York. So the problem is not that 

people do not want to learn the language; the problem is the services and resources that are available. 

Mr. Peers, you mentioned a variety of specific initiatives 

throughout the country in places as diverse as Idaho, Florida, and 

New York. What is the advantage of those local initiatives? By 

what means are they encouraged, and how are the lessons learned 

shared throughout the workforce-development community? 

Mr. PEERS. I think that the biggest advantage is communication. 

Quite often, economic-development initiatives are going on over 

here, workforce initiatives are going on here, and as many of my 

colleagues here on the panel have already said, you know, we need 

to refocus our training efforts and make sure that they correspond 

to industry trends and to jobs of the future. That cannot happen 

if the two worlds are not talking and coming together. 

So first off, it is communication, and then, secondly, I think, once 

that communication occurs, they start to realize that there are very 

similar goals, that you cannot have effective economic development 

without a good workforce, and you cannot have a good workforce 

without having the jobs available to meet those worker needs and 

to grow your economy. And then you start to see more and more 

the leveraging of resources in creative ways, in ways that allow a 

maximization of efforts on both fronts. So those are the two key 

benefits of bringing those two together. 

Ms. VELAZQUEZ. Thank you, Mr. Chairman. 

Mr. BARTLETT. Thank you. I was born in 1926, and so, through 

my life, I have seen a lot of technology changes. We still plowed 

the fields with horses when I was a little boy. 

Some feel that some of these technology improvements have had 

a dark side as well as a bright side. One of those is air conditioning. Many people would argue that our country really started 

downhill when they air conditioned Washington so that Congress 

could stay here through the summer. I think it was Will Rogers 

who noted that anytime the legislature is in session, the Republic 

is at risk, and I think that we had a kinder, gentler, less-intrusive 

government before we had air conditioning, and we could stay here, 

focused on mischief through all of the hot summer. 

A second technology improvement which I think, arguably, has 

had some very negative effects is television. I note that the more 

people watch television, the lower our SAT scores were in our 

schools. So through all of those years when television was becoming 

more and more important in the home, why, the SAT scores were 

dropping lower and lower in our schools. 

Our higher education institutions are a marvel of the world and 

the envy of the world, and to know that all you have to do is to 

go there to see who the students are, and most of them are not students from this country because students from all over the world 

come there. 

A little bit ago, there was a survey done of the graduates of our 

secondary schools in 21 countries, and we were thankful for CyVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00043 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
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press and Sri Lanka because of the 21 countries they were the only 

two whose young people scored lower than our young people scored. 

All of you have been talking about education and training, and 

Mr. Lewis from the previous panel noted that if he was going to 

choose one word to denote the quality of the young people who 

came out of our K-through–12 system, it was atrocious in terms of 

their preparation in education. Clearly, how could we have, far and 

away, the best education system in the world in our graduate 

schools and one that is not far from the basement? Of all of the 

industrialized, civilized world, I think we rank at the bottom. How 

did we get there? Why are we doing such a tremendous job in our 

graduate schools and such a lousy job in our K-through–12? To 

what do you attribute that? Let us just go through the panel and 

tell me what you think. How did we get there, and what do we 

need to do to get out of the basement? 

Ms. BUEHLMANN. I think one of the distinctions that you have to 

make is you have a universal K–12 system, and if you are going 

to make it relevant to students, it is getting back to understanding 

why they are there, the context for their learning, what relevance 

it has to what they are going to do next, and seeing a path for 

them to be able to get there. 

I think this is also true for our teachers. I think we have to create a system where people understand that the skills that are 

needed to go into the workplace or into higher education are very 

similar and that we should get away from the notion of a lockstep 

education system and instead create significant on ramps and off 

ramps so that individuals can participate in education, understand 

the relevance of it, apply it, and be able to use it to advance themselves, both in post-secondary education and in the workplace. We 

also need to do the same in terms of our college students when 

many of them are graduating from college and going back to community colleges in order to get skills that are relevant to the workplace. We have to better understand that the skills of the workplace, in fact, are many times more difficult and more complex 

than our going to our institutions of post-secondary education. 

And, finally, I would suggest that we encourage people to learn 

throughout their lives, understand that they can get certificates 

and advance through those certificates, accumulate those certificates towards degrees, if they choose to, but that it is not necessarily a lockstep situation, and that parents need to understand 

that going into the workplace and being able to go back into education has as much relevance as continuing on and getting through 

it in one fell swoop. 

So I would say it is relevance, and it is connection to the path 

that we are pursuing. 

Mr. BARTLETT. I think most of our people understand the need 

for lifetime education because the technology is changing so rapidly. But we have graduated, I think, more than a million people 

from our high schools who, quite literally, could not read their diploma. Shame on a society that permits that to happen. I think you 

were addressing that in your lockstep, that you cannot just———

. Ms. BUEHLMANN. I think we also give up. There are many people 

who believe that if a child cannot read by the fourth grade, they 

41

are never going to be able to read, and we have programs now that 

indicate that in high school we have inventions we can use to teach 

literacy, to encourage students to see the relevance and be able to 

read again and connect with the world. If they are shut off at a 

very early age, and we give up on them, we are going to have a 

group of people that are not going to be encouraged to learn. 

Years ago, there was a book written called Pygmalion in the 

Classroom, and basically if we set our expectations for students not 

to achieve, they are not going to achieve. And so I think we have 

to turn ourselves around and understand that at every step of the 

way if we engage the student, we believe in them, we are their advocates, they will achieve, and I think we have lost that in terms 

of our schools today, and I think we need to regain that. 

I would also say that if you want to talk about some things that 

would encourage English as a second language and perhaps even 

adult basic education, to look at such tax incentives as Section 127, 

which is only allowable right now for college degree credit. Why not 

allow some of that to also be used for English-as-a-second-language 

training and adult basic education so we can expand the opportunities of those individuals that do not have those basic skills but 

need them to invest in the workplace? 

Mr. BARTLETT. Bill Bennett, who was President Reagan’s secretary of education, tells a very interesting story. After they decided that they were not going to be able to shut down what they 

thought was an unconstitutional federal Department of Education, 

they set about trying to determine what worked and what did not 

work in education, and they found two schools. I think they were 

both in Illinois. One of them spent twice as much money per child 

as the other one, but the poor school, the school that spent only 

half as much per child, year after year, had higher achievement 

scores on the tests. 

And so Bill Bennett went to visit these two high schools in Illinois to see what was going on there, why the school that had only 

half as much money for their kids every year scored higher on the 

achievement tests. And when he arrived at the school and met the 

principal, he said, How is it going? The principal said, We have got 

it tough here. We do not have much money. About all we can do 

is teach the three R’s. And if you will think about what we do with 

additional money when we give it to our schools, almost always 

they commit it to something that competes with the three R’s. 

The teachers do not want to teach any more hours in a day, parents do not want their kids going to school any more days in a 

year, and so when we give more money to education, think about 

what happens to the additional money you give. Very frequently, 

doesn’t it support programs that compete with the three R’s? I 

think that it was no accident that this school that had little money 

had kids that scored better because, as the principal said, About 

all we can do here is teach the three R’s. 

In a former life, I was privileged to teach for 24 years. In this 

world, by the way, that is the closest you can come to immortality 

because you live on in your students, and I value those 24 years. 

And I noticed something that is more and more lacking in our 

schools today. I think where there is no discipline, there is no 

learning, and I think there is not substitute for an inspired and inVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
42

spiring teacher. And for all of the years I taught, the most important person in the whole school system to me was the janitor. He 

had the school open, and it was warm, and he had some chalk on 

the chalkboard, and that is all I needed. The rest of administration, 

they could have been gone to some foreign country for a year’s vacation; it would not have mattered to me. 

I think we need to get back to a real respect for education. If you 

are going to respect education, you have got to have discipline in 

the classroom. Where there is no discipline, I do not think there 

is any learning, and I have real trouble seeing discipline in many 

of our classrooms today. 

Mr. McCarthy? 

Mr. MCCARTHY. I think the key issue we are also missing is the 

sense of community, the sense of community between education 

and business. When you think of what happens with workforce investment boards, those that are successful, there is a direct tie to 

the skills that are being taught in the school to those being sought 

by employers. 

There seems to be the channelization of education and employment rather than at the K-through–12 level because the preparation is towards the next level of education, not necessarily towards 

the next level of education and other opportunities, whether they 

be trade and technical schools, careers immediately without any 

additional formal education. 

The community engagement and support, specifically the business community’s support and its recognition by junior colleges, Kthrough–12 institutions, is going to be critical to reestablishing 

what I think will be the appropriate cause and effect associated 

with education. Absent that, we will continue along separate paths 

where, to your point, literally, the connection starts again at the 

graduate school, and by then, it is maybe too late at times. 

Mr. BARTLETT. Don’t you think that you get from your children 

and your society what you appreciate? I think our society is a long 

way from appreciating academic achievement. 

When I was younger, a good academic achiever was known as a 

‘‘square,’’ and he had trouble dating the pretty girls. Pretty girls 

now play dumb so that they can get a date, and the bright guys 

are known as ‘‘geeks’’ and ‘‘nerds.’’ Is that the current terminology 

for bright guys? And they have trouble dating pretty girls. 

Don’t you think that we I have some better success in our schools 

if we told our society we really appreciate what you are doing, and 

if we invited academic achievers to the White House about as often 

as we invite athletic achievers there and appreciate them? I just 

think that we do not appreciate education in this country. We appreciate the results of education, the entrepreneur, the guy who is 

developing all of the new things, but he got there because he educated himself very frequently in spite of an education system which 

continues to turn out people that, in the words of Mr. Lewis, their 

preparation was atrocious, was the best word he could use. 

Mr. Joyce, was your grandfather’s last name Bilco, or how did he 

get the Bilco name for the door? 

Mr. JOYCE. His last name was Lyons, and his first company was 

Builders Iron Company, so he took the B-I from that and the L 

from the family name. 

43

Mr. BARTLETT. Okay. That is how he got. For those of you who 

do not know the Bilco door, it is the standard, and if you are going 

to put an outside-access door to your basement in a house when 

you are building it,—in another life, I built homes for about a 

dozen years, too—so you are going to buy a Bilco door even though 

somebody else manufactured it. It was still a Bilco door because 

your name was the characteristic name for any door that served 

that function. 

What do we need to do so that the product of our K through 12 

comes somewhere near the product of our graduate schools, which 

is clearly the best in the world? 

Mr. JOYCE. I have spent a lot of time in the classroom encouraging students to consider careers in manufacturing. Most are surprised that today’s manufacturing environment is clean, it is high 

tech, it is interesting. People work in clusters and teams. They 

enjoy all of that. When they walk through our plant, it is not anything like they have imagined. And when we talk to eighth graders, as an example, about this Connecticut State Scholars program 

and encouraging them to enroll in a more rigorous curriculum so 

they can get the better job, they have more opportunities after high 

school, we asked them a simple question right up front: Where do 

you think, worldwide, the United States stands in terms of math 

and science achievement? And always the answer is one, two, or 

three in the world. Well, we are actually 18th and 19th, respectively, in the world, and they are shocked. How can that be? 

Mr. BARTLETT. Who is number one in the world? 

Mr. JOYCE. Five of the top six are Asian countries. I do not know 

which is the first, but five of the top six are Asians. One reason 

is that the culture in Asia regarding education is far different than 

ours. They mostly attend school six days a week, and it is another 

question I asked the students: Who is the student athlete here? 

Okay, Jim. How often do you practice your basketball? Well, every 

day, sir. Maybe not Sunday, but six days a week. I said, Okay. 

Well, that is how the students learn in Japan. They go to school 

six days a week. 

So you do not do that. You only go five days; sometimes you go 

four, and as every week passes, you fall behind a Japanese student, 

week after week after week. So what happens after four years of 

high school? Where do you think they are compared to us? They 

are number one. We are number 18. It stands to reason. 

So you need to practice more, and to get there, we need to challenge our students, we need to set our standards higher and our 

expectations higher, and there is no question in my mind that we 

can achieve those standards. 

Mr. BARTLETT. You mentioned the Orient and their achievement. 

Several years ago, I was the commencement speaker at our two 

high schools in Garrett County,—there are only two—Southern 

High and Northern High, and Southern High had 200 graduates, 

and there was only one minority, and that was an Indian girl, an 

Asian-Indian girl, and she was the valedictorian. So in the afternoon, I went up to Northern High, and there was only one minority 

student there, and that was little Chinese girl, and she was carrying around a little manilla folder. I said to my wife, I wonder can 

it be true that she is the valedictorian? And sure enough, she was 

44

the valedictorian. Now, there were two minority students, both oriental, out of 335 kids, and they were the two top achievers. I 

thought, gee, maybe there is a lesson there. 

Mr. Volgenau? 

Mr. VOLGENAU. My company for years has supported inner-city 

learning centers where poor kids can come after school lets out and 

receive both academic and ethical education, and we have found, 

through that program, that there are several things that make a 

difference. One is parental involvement. I am thinking of our work 

particularly with the Darrell Green Youth Life Foundation. Their 

parents have to be involved. They have a very high success rate 

with their kids, and their parents must be involved. 

The other is role models, and ITAA studies again and again have 

pointed out that particularly for women and minority members, 

they need role models in the area of information technology, and 

that makes a difference. As long as our role models from a society 

standpoint are rock stars and super athletes—I love athletics. I am 

still involved at my age in athletics. I have always loved athletics, 

but the NCAA announcement, they are proud to say, is 95 percent 

of our athletes are going pro in a profession other than sports, and 

that type of thing is important. 

There is one other point, and that is I have got a Ph.D. in computers and automation and engineering, and one thing that has 

surprised me again and again and again about information technology is it is never too late. Time and again, I have seen people 

who have been only high school graduates who have had the courage to get involved and just the perseverance and study information technology, and they have become very, very good at it, and 

I have seen many people who have graduated in the liberal arts 

and have adapted themselves to leadership roles in the area of information technology. So it is never too late. 

We talk about communications. One of the problems with IT is 

the lack of information or, correspondingly, the data glut. There are 

a lot of government programs underway,—somebody mentioned the 

smokestacks—but a lot of businesses just do not know about them. 

And so ITAA for years has worked on community partnerships 

which involve small businesses and community colleges and the 

local community to try to get the information out about these training programs that already are being funded. There may not be 

enough nationwide, but there are plenty of them, and there is plenty of infrastructure for training in the area of IT. 

One final point. We think of information technology as being a 

bunch of PCs on desktops. That is just a very small part of it. For 

each one of those types of computers that is made, there is a hundred other computers that are embedded within other machines to 

make them operate better. 

So when we talk about mechanics and fixing cars, for example, 

those folks, too, have to have some knowledge of what happens 

when a computer fails, when the software fails. Thank you. 

Mr. BARTLETT. You mentioned the involvement of parents. Several years ago, I had the opportunity to visit with Steve Forbes a 

small, black school in Baltimore. They would not admit a child to 

the school until the family made a commitment to the child’s education. I was the commencement speaker at a graduation. It was 

45

not a graduation; it was a celebration. The diploma was given to 

the family, and then the family, the caregiver, the family then gave 

the diploma to the graduate, recognizing the contribution that the 

family made. 

Another interesting thing about those graduates: Every one went 

on to college because the principal said that they were not ready 

to graduate until they had been accepted in at least three colleges 

and had a scholarship to at least one college, and they were not 

ready to graduate until they had reached that. 

So the involvement of the family is really, really very important, 

and you see that. 

Our district has the highest number of young people admitted to 

our military academies, and in almost every case, and these are 

really the best of the best because we have more than 10 times as 

many apply as who are accepted in these academies, and one year 

we had 33, so we have a great district, but almost invariably they 

come from a family that gives great family support, and so your 

emphasizing that and education is one of the keys, I think. 

Mr. VOLGENAU. I have just one comment. Please send them to 

the Naval Academy. 

Mr. BARTLETT. We sent 17 that year to the Naval Academy. 

Mr. VOLGENAU. Thank you. 

Mr. BARTLETT. It is in our district. It is in Maryland. I represent 

a district just 50 miles north of here, and, of course, our school is 

a Maryland school. That year, 17 out of 33, just a bit over half of 

the kids, went. You nominate 10 for each slot. Ordinarily, you have 

one slot. That year we had two slots in the Naval Academy. We 

nominated 20, and they accepted 17 that year, really quite a phenomenal record. 

My colleague from New Jersey, Rodney Frelinghuysen, did an oped piece saying that his district had the most young people admitted to our military academies. He had fewer than we, so I, with 

some confidence, can say that we probably have the most. But the 

involvement of the family, I noticed, just visiting those young people and their families and going to the awards. It is great to go to 

the awards where other kids are getting a $500 and a $1,000 scholarship, and I announce that they have been living with a star who 

is qualified for a $250,000 scholarship. They always get the most 

applause—it is kind of fun—at that ceremony. 

Mr. Coffey? 

Mr. COFFEY. Well, I would just go to your point about what made 

the four-year college and graduate curriculum work in the United 

States, and I think there are two significant federal policies that 

did that, the first being the Land Grant College Act during the 

Civil War, which basically formed a bridge between the agricultural industry in the United States and the educational system to 

create a system that built support for the small farm community 

in the United States and encouraged states to have major educational institutions, and I think that was the first major, significant, federal contribution to graduate education. 

The second major federal contribution, I think, was the GI Bill 

of Rights after World War II in which you basically opened higher 

education to a much broader potential audience than it ever would 

have had before. And I think, with those two acts, there was sigVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00049 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
46

nificant change in the educational system that encouraged the 

growth of a really first-class, excellent educational system at that 

level. 

We have heaped great praise on both of those acts for hundreds 

of years now, and they are held up, I think, as examples of where 

federal intervention did, in fact, change America rather dramatically. I do not feel we have had anything like that in elementary 

and secondary education. 

Mr. BARTLETT. Some of the best courses I took at the University 

of Maryland were in the department of agriculture. It is a landgrant college, and my best endocrinology course was reproduction 

in poultry, so I am appreciative of the contribution of land-grant 

colleges. 

Before we get comments from our last two panel members, Ms. 

Velazquez has a couple of questions she would like to ask. 

Ms. VELAZQUEZ. No. 

Mr. BARTLETT. Okay. After you. Okay. Mr. Peers? 

Mr. PEERS. Yes. I want to hone in on the ability to connect young 

adults to what they are actually going to experience in the workplace. Each of my colleagues here has talked about that. So I would 

say is how do we increase opportunities for experiential learning, 

and how do we start that early enough so that students, young 

adults, get exposed to different careers and opportunities? Encourage co-op programs and so forth. Encourage opportunities to work 

part time and go to school part time even in high school. I was fortunate enough to start working at a very early age, and it exposed 

me to a lot of different opportunities. 

Another thing I would do—we try and get more and more businesses, at least in our broker role at the chamber, to come into the 

schools and to be part of what is happening. You know, you mentioned, Mr. Chairman, about teaching, and with all due respect, I 

submit you might have done this backwards, that someone of your 

experience and knowledge, after you have done all of these things 

that you have done, including served in Congress, would have a lot 

to offer now as a teacher. 

Mr. BARTLETT. Well, I am only 78. I may go back. 

Mr. PEERS. There you go. And I really believe that a lot of people 

go into education, and that is their only field. So teachers and guidance counselors are not exposed to what most students are going 

to face in the real world of work. 

So how do we bring people who have already experienced the 

world of work in many different capacities, in many different ways, 

and how do we bring them into the schools so that they could share 

this knowledge, share this wisdom, share this expertise in a way 

that exposes more and more of our young adults to what they are 

going to face? So I think we could look at that. 

And then, just lastly, I think we need to stop thinking it is an 

either/or, the either/or being you go on to graduate school or you 

do nothing. There are plenty of occupations that are not going to 

require advanced degrees. There are plenty of occupations that are 

going to require a very good, solid, vocational education, and to 

what degree do we concentrate on core competencies that are going 

to lend themselves to those types of occupations? If you want to be 

a mechanic, you do need such things as critical thinking skills, creVerDate 0ct 09 2002 18:54 Oct 21, 2004 Jkt 000000 PO 00000 Frm 00050 Fmt 6633 Sfmt 6633 G:\HEARINGS\94136.TXT MIKEA
47

ative problem-solving skills, and that needs to be part of your curriculum when you are working with these young adults, and you 

have to encourage them that there are other opportunities other 

than just going to college. 

Mr. BARTLETT. I appreciate you mentioning these job opportunities. We are now having to import those skills because there are 

far too few people with these skills available in our country, and 

it is because, again, we do not appreciate that. 

I built homes for 12 years. At the end of the day, if I had done 

it right, it is going to be there a hundred years from now. Most of 

the laws we pass in Congress, I hope, are not here a hundred years 

from now. It is really a lot of satisfaction in those trades, and we 

just are not appreciating them and not incenting our young people 

to go into them. 

Mr. Caslin? 

Mr. CASLIN. Thank you. A couple of things on universities. How 

do they measure quality? I have had a number of conversations 

with leaders across the country of universities, and they measure 

it in endowment dollar per student. That is one key measure, and 

what that means is resources to the student. 

M.F.T.E. works with a number of universities who have no 

bridge to the community, that even though they have billions of 

dollars in endowment and resources for their faculty and their students, the communities that surround them are in great need, and 

there is no bridge. 

In fact, I would like to quote one of our students who grew up 

in west Philadelphia, and because of the NFTE program and the 

University of Pennsylvania Wharton Business School, he, as a junior in high school, learned how to start his own business. He then 

became turned on to finance. He went to Morehouse College, majored in finance. He was recruited by Morgan Stanley, went to Morgan Stanley in New York, worked there. He was recruited by Goldman Sachs, moved to London, worked for Goldman Sachs, and then 

at the ripe old age of 26, moved back to Brooklyn in Clinton Hill 

and basically now employs 20 people in the largest supper club, 

soul food supper club, in Brooklyn. It is called the Five Spot Soul 

Food Takeout and Supper Club. And Malik Armstead said, ‘Knowledge is key; knowledge is power.‘

‘I think you raised the issue, as did Daniel Webster years ago: 

Knowledge is the true sun of the universe, for on it life and power 

dance in every beam.‘

We have found, through Gallup polls, 80 percent of students in 

America want to learn how to be entrepreneurs, want to control 

their destiny, want to get in the marketplace, and very few have 

access to it. That is why NFTE started. We started because teachers could hardly get the resources they needed just to do their core, 

and we went out and raised $180,000 our first year and now have 

raised nearly $70 million from the private sector over 16 years to 

bring entrepreneurship literacy to young people to turn them on to 

life. 

We are in India because of job riots. Imagine in northern India 

where the education system is working, where you have 10,000 

young adults turning out with the equivalent of 1,500 on their 

SATs showing up for 300 or 400 jobs and people being killed in the 

48

stampede on a job riot. Two people from that community, Jaipur, 

came to NFTE. They had retired from the business world here in 

the States, and they said, We cannot sit by and retire, retirement 

in New Jersey, and see our homeland and a superior education system have this type of stress and conflict. Why can’t we promote 

more entrepreneurship in northern India? 

N.F.T.E. is replicating in Germany, which has a very rigid, very 

strong math and science achievement because there are over 

200,000 20-year-olds who are unemployed and without a certificate. 

What we are seeing in many of the accomplished systems with 

high achievement, there is really no entrepreneurial thinking, 

there is no marketplace penetration and embrace, and even in the 

U.K., if you do not test well at the age of 10, you are put onto a 

track fairly to oblivion. We have seen that in South Africa in Tanzania where, again, education systems have certain criteria and 

certain filter systems at a very young age which do not give young 

people the chance to recover or even tap their potential. 

So there is a flexibility to the U.S. education system which gives 

late bloomers a chance, and I think that is positive. There is a rigidity in some of the more formal systems across the world. The 

British education system, de facto, influences 60 countries through 

the commonwealth. It is fascinating to see that. That is why we 

started in London to understand how this education system works 

and how we can bring entrepreneurship education, and we have 

seen that there is one department of education and labor that coordinates the whole country, the whole United Kingdom, and so 

our ability to promote an idea is actually more effective and efficient in that way, whereas in the United States, the ability to promote and develop NFTE over 16 years, we have had to navigate 

the U.S. federal departments, the state departments of education, 

and then the local districts’ education, superintendents, schoolbased management with principals. So you have 16,000 school districts that are starting to come to somewhat of the same page, but 

they are very, very, very decentralized. 

So it is an interesting struggle, and I think the biggest aspect 

goes back to what is the end game, and for NFTE, we see the end 

game as the number of productive and responsible, self-governing 

people per capita in a community. The more you can build that up, 

the more you have a chance for a safe and prosperous and just 

community. The more those numbers decline, the more you have 

people imprisoned by the tyranny of the few. 

Mr. BARTLETT. You mentioned entrepreneurship and its importance. We are one person out of 22 in the world in America, and 

we have a fourth of all of the good things in the world. We use a 

fourth of the world’s energy. We represent a fourth of the world’s 

economy, and I think that entrepreneurship has largely been responsible for that. 

I think the reason that entrepreneurship has flourished here is 

because of our enormous respect for the rights of the individual. 

Implicit in our Constitution and very explicit in the first 10 amendments, which is why our founding fathers in 1791 felt compelled to 

make explicit what was clearly implicit in the Constitution. And as 

government gets bigger, and we have more of us, and we need 

more regulations, that respect for the rights of the individual is at 

49

risk, and I think that to the extent that that is at risk, our society 

is at risk. 

What you need to go along with that entrepreneurship, which we 

are fantastic at, is an education so that you can do something with 

that entrepreneurial spirit, and that is what we have been talking 

about in today’s hearing, our failure, not in the graduate schools,—

we are doing fantastic there—but at the lower levels to educate. 

Ms. Velazquez, and then I have one final question to ask before 

we thank you for your testimony. 

Ms. VELAZQUEZ. Thank you, Mr. Chairman. 

Ms. Buehlmann, I want to go back to the Federal Workforce Development programs, and maybe you recall the question that was 

posed by Mr. Udall to Ms. DeRocco mentioning the study that was 

conducted by the Office of Advocacy, SBA Advocacy, that shows 

that small businesses really do not participate in those programs 

that are available for them. Why do you think that Federal Workforce Development programs have such a hard time getting small 

businesses to participate? 

Ms. BUEHLMANN. I believe we provided to each of you a copy of 

our ‘‘Rising to the Challenge Survey,’’ and the thing that we found 

most prevalent in terms of answering that question is lack of 

awareness. So one of the things we are trying to do through our 

work is really generate awareness through chambers across this 

country to the resources that are available in communities to help 

small- and medium-sized businesses with their workforce-development concerns, issues, and requirements. It is the number one 

issue that they raise consistently, is how do we create a workforce 

system that works so that we can participate and get the skilled 

and quality workers that we need? 

Ms. VELAZQUEZ. But given the fact that we do have some programs that some of them have been either zeroed out, flat funded, 

but there are some that still have been funded———. 

Ms. BUEHLMANN. We have found, over time, that there is greater 

awareness. It has gone from 5 percent to 40 percent in terms of the 

surveys that we have done. We have also found that those who use 

it, and that is about half of the 40 percent have used it with any 

regularity, are very satisfied with the services they receive. So I go 

back to, even the National Association of Manufacturers and Jobs 

to the Future, a Boston-based firm that we coordinate with in one 

of our particular efforts—all of them found it is this issue of lack 

of awareness. 

Ms. VELAZQUEZ. Does that mean that the federal government, 

the Department of Labor and other agencies need to do a better job 

in terms of outreach? 

Ms. BUEHLMANN. From our perspective, that is very important, 

that there needs to be greater communication about the benefits of 

using the publicly funded workforce system and other resources in 

communities, that we need a better understanding and put a different face to those. Randy Peers mentioned, for example, that they 

view them as a social service. Another thing that came out in this 

survey is that more and more of them are viewing it as an economic-development concern and issue, and connecting it to economic development is really a way to better engage business. 

50

We also believe that if you put a business face to it, you create 

a communication mechanism by which you present the business 

case, which ultimately gets the workers they need but also gets the 

jobs that individuals need with family-sustaining wages, that it is 

a win-win for everybody in the community. 

So we believe that creating awareness, creating different kinds 

of outreach, putting the business case to it, which we can do, and 

talking about it is a way not only to hire individuals but to retain 

them, to advance them, and allow them to gain greater skills and 

connection to the workplace is really the way that we need to go. 

Ms. VELAZQUEZ. Did you share that survey with the Department 

of Labor? 

Ms. BUEHLMANN. Yes, and, in fact, part of what Ms. DeRocco was 

talking about funded this particular survey, in fact, 3,700 smalland medium-sized businesses through 70 communities throughout 

the country. 

Ms. VELAZQUEZ. Thank you. Thank you, Mr. Chairman. 

Mr. BARTLETT. Thank you. Rather than ask you to respond, I just 

want to make a couple of comments and ask if you might respond 

for the record because what I want to spend just a moment or two 

on is a conundrum that I have been concerned with for quite a 

while now. We have been losing our manufacturing jobs for a long 

while now, and we are moving to a service-based economy. We are 

still doing pretty well as far as quality of life is concerned, but if 

you push this to an absurdity, clearly, it cannot go on forever. If 

all we do is take in each other’s laundry and cut each other’s hair, 

obviously, that is not a prescription for a viable economy, is it? 

I understand that wealth is created in only three kinds of activities in our society, in any society. It is created by farming, it is created by mining, and it is created by manufacturing. We have been 

talking an awful lot today about IT, information technology, and 

that involves largely computers and moving little electrons around, 

and I note that you cannot eat them, you cannot wear them, you 

cannot ride on them. They will not keep the rain off your head. 

Clearly, IT is a support technology, and unless that IT is used for 

agriculture, for mining, or for manufacturing, ultimately it really 

is not creating wealth, is it? 

And I note that our trade deficit last year was $489 billion. Our 

debt went up last year in this country $700 billion. They will tell 

you the deficit was $500 billion, but the debt went up $700 billion, 

and I think that if the debt went up $700 billion, there was a $700 

billion deficit. The other 200, by the way, is the monies we take 

from the trust fund, and we pretend that they are not debt. It is 

the most significant we owe because we owe it to our kids and our 

grand kids, and shame on us because that debt is getting bigger 

and bigger, and we are living quite well today at their expense because when it comes their turn, not only will they have to run government on current revenues; they will have to pay back all of the 

money that we have borrowed from their generation. 

I promised, 12 years ago, when I was running that I would conduct myself so my kids and grand kids would not come and spit 

on my grave because of what I had done to their country. I am still 

trying to keep that pledge. 

51

Well, if it is true that wealth only comes from farming and from 

manufacturing and from mining, how did we get from where we 

are, with this enormous obsession with moving electrons around, to 

a society which is really producing wealth? I would like you to comment on it, if you would, for the record because we have imposed 

on your time more than we really should have. 

I want to thank you all very much for a very interesting session, 

and we stand in adjournment. 

[Whereupon, at 5:00 p.m., the Committee was adjourned.]

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