STEP FORWARD - Shriver Center

By Brian Clappier, Community Investment Specialist

Tough times often bring out the best of people, but, with the latest surge of economic gloom, optimism can be difficult. Today’s cutthroat, globalized economy is undoubtedly challenging to American workers, but it has also compelled a novel partnership between employers and employees that addresses the need for new skills and knowledge. The Shriver Center supports and promotes Lifelong Learning Accounts (LiLAs) as a step to help the nation’s workforce keep pace with an evolving job market. This innovative program creates portable, universal, voluntary, employer-matched, employee-owned individual educational accounts used for training and educational purposes.

How It All Began

Originally developed by the Council for Adult and Experiential Learning (CAEL) in a three-city, five-year, multisector demonstration, federal legislation has now been introduced to create LiLAs in a ten-city demonstration for up to 200,000 workers. LiLAs have also been proposed in twelve states as a 401(k)-like plan to be offered by employers as part of a benefits package, and members of the Shriver Center’s Community Investment Unit are working with CAEL-LiLA State Policy Director Randall Johnson to coordinate efforts in Illinois.

Unlike previous, publicly financed workforce development programs such as Career Advancement Accounts (CAAs) and Individual Training Accounts (ITAs), LiLAs leverage private and personal funds for a wide range of educational investments. By making this a basic component of employee-compensation packages, LiLA policies would enhance learning opportunities for all working adults. In addition to the principal contributions from the employer and employee, third-party funds may come from philanthropic organizations and federal or state tax credits.

Private Sector Shows Initiative

This year IBM made “Learning Accounts” (similar in structure to LiLAs) available to employees, and Shriver Center Attorney Dory Rand recently met with IBM’s Robert Reid to discuss lessons learned. Through this program, workers can invest up to $1,000 per year for education not necessarily related to their current job responsibilities, and the company will match 50 cents for every dollar. The money is then held in an interest-bearing account, and, if they do not use that money, employees may take the account with them when they leave the company. IBM Chief Executive Samuel J. Palmisano notes that the program helps recruit talented workers and build social compacts. His bottom line: The LiLA-like program makes his company, his employees, and the American economy more competitive. By bridging and balancing private- and public-sector interests, the Shriver Center seeks to help implement LiLAs on a large scale throughout the country.

Tags: Asset Building

This entry was posted on Wednesday, July 2nd, 2008 at 9:21 am and is filed under Community Investment. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.