‘Working for Alabama’ bills aim to improve state’s workforce participation rate

Alabama Gov. Kay Ivey speaks at an event announcing the "Working for Alabama" legislative package on March 21, 2024 at the Alabama State Capitol. The bills in the package aim to raise the state's low workforce participation rate. (Brian Lyman/Alabama Reflector)

Gov. Kay Ivey and Alabama lawmakers Thursday unveiled a a package of bills aimed at improving the state’s low workforce participation rates. 

The package, named “Working for Alabama,” will attempt to address a host of issues, including education, child care and housing.

“While we have record low unemployment, our labor force participation rate is one of the lowest in the country, and, y’all, that’s not low in a good way,” said Ivey. 

Alabama’s unemployment rate in January was 2.9%, compared to 3.7% in the rest of the country.  But its workforce participation rate has trailed the nation’s for decades. Alabama’s rate in January was 57.1%, according to the St. Louis Federal Reserve, compared to a national rate of 62.5%, according to the Bureau of Labor Statistics. The state’s participation rates have trailed the nation’s for at least 48 years. 

Experts told the Reflector in August that the state’s older-than-average population could play a role. Experts who spoke in October to a state commission studying the issue also said a lack of affordable child care; a lack of transportation in some areas and a lack of workforce training  prevent people from working. 

The bills in the package include: 

• SB 252, and HB 372, sponsored by Senate President Pro Tempore Greg Reed, R-Jasper, and Rep. Randall Shedd, R-Fairview, creates the Alabama Growth Alliance, a public corporation that will provide input and support on economic development, such as increasing private investment in the state and promoting opportunities for minority-owned businesses.

• SB 247, and HB 344, sponsored by Senate Majority Leader Steve Livingston, R-Scottsboro, and Rep. Danny Garrett, R-Trussville, rename the Secretary of Labor and Department of Labor the Secretary of Workforce and Department of Workforce and expand duties to include oversight of all current workforce development programs.

• SB 253, and HB 373, sponsored by Sen. Donnie Chesteen, R-Geneva, and Rep. Kelvin Lawrence, D-Hayneville, create an alternative diploma program focused on career and technical education.

• HB 358, sponsored by House Minority Leader Anthony Daniels, D-Huntsville, and Sen. Garlan Gudger, R-Cullman, creates child care tax credits.

• HB 346, and SB 25o, sponsored by Sen. Chris Elliott, R-Daphne, and Rep. Cynthia Almond, R-Tuscaloosa is referred to as a Housing Tax Credit. The texts of the bills were not immediately available online Thursday.

• SB 242, and HB 349, sponsored by Senate Minority Leader Bobby Singleton, D-Greensboro, and Rep. James Lomax, R-Huntsville, create “innovation districts” as public corporations for certain activities and acquiring property. The bill does not define what an innovation district is.

• SB 243, and HB 368, sponsored by Sen. Dan Roberts, R-Mountain Brook, and Rep. Neil Rafferty, D-Birmingham, are constitutional amendments that would give local governments (with the approval of the Legislature) the ability to create “innovation districts.”

Alabama House Speaker Speaker Nathaniel Ledbetter, R-Rainsville, told reporters after the event that the package would have around a $30 million impact on the Education Trust Fund.

“Not only will we see that come back, we’ll see that money come back, probably sevenfold,” he said.

Leaders of both parties in the Senate said in separate interviews Thursday that they were not worried about the impact of the bills on the Education Trust Fund.

“Now there are always going to be ideas on how do we balance appropriately, the amount of tax breaks that are offered to incentivize more growth and to not give away the store, if you will, to make sure that we don’t put ourselves in a place to where we’ve incentivized to the point that he has hurt us fiscally and our budgets,” said Reed. “I think we’re right on target of where we need to be.“

“The more people we can put back into workforce, the more people are now paying taxes that goes back into the ETF, so it’s a cycle it feeds off itself, so it doesn’t bother me,” said Senate Minority Leader Bobby Singleton, D-Greensboro.

Senate Finance and Taxation Education Chair Arthur Orr, R-Decatur, said he was not familiar with the package. 

House Ways and Means Education Chair Danny Garrett, R-Trussville, said that it was important for them to look closely at any credit proposal and said that credits could cause the education budget to grow, which is the goal.

“But we have to be careful that we don’t over commit or implement credits that will not accomplish that purpose,” he said.

State Superintendent Eric Mackey said in an email Thursday that he has “scanned” SB 253, and his team is working on a full analysis, but he was excited that “Alabama’s high school students included in this visionary group of bills designed to usher Alabama’s workforce into a prosperous future.”

“Today’s students are both the key to, and the ultimate beneficiaries of, the economic opportunities of the 2030s and beyond,” he wrote. “Making sure that every child’s path to a good job has been a top priority for us since day one. We talk about: every child, every chance, every day; and we want to make sure every child is well served by our schools and all the opportunities they offer.”

Story was updated at 4:52 p.m. with comment from Garrett.

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