Committee Meeting

of

ASSEMBLY LABOR COMMITTEE

"Testimony on the changing demographic make-up of New Jerseyís workforce"

LOCATION:

Committee Room 9 
State House Annex
Trenton, New Jersey

 

DATE:

March 6, 2003
10:00 a.m.
MEMBERS OF COMMITTEE PRESENT:

Assemblywoman Arline M. Friscia, Chairwoman

Assemblyman Paul A. Sarlo, Vice-Chair

Asemblyman Neil M. Cohen

Assemblyman Robert J. Smith II

Assemblyman Guy R. Gregg

Assemblyman George F. Geist
 

ALSO PRESENT:    
Gregory L. Williams Beth Schroeder Victoria R. Brogan
Office of Legislative Services Assembly Majority Assembly Republican
Committee Aide Committee Aide Committee Aide
     


                                                     

Meeting Recorded and Transcribed by
T
he Office of Legislative Services, Public Information Office,
Hearing Unit, State House Annex, PO 068, Trenton, New Jersey

 

 

 

 

 

ASSEMBLYWOMAN ARLINE M. FRISCIA (Chairwoman):

Good morning, and a special good morning to all you brave souls who made it

here from North Jersey.

We got on the Turnpike, and it was sleeting like crazy. The speed

limit was down to 45 by the time I hit exit 10 interchange. So we had to take

it easy, this morning, getting here. So Iím sorry Iím a little late.

We have a very important and interesting topic today on the

changing demographics of New Jerseyís workforce. And a lot of different sectors

are very interested in this question. And Iím very anxious, as Iím sure the entire

Committee is anxious today, to hear this from the people who have come.

So with that, I will ask Greg to do a roll call, and then we will begin

our hearing.

Welcome, Assemblyman Gregg.

MR. WILLIAMS (Committee Aide): Assemblyman Gregg, roll call.

ASSEMBLYMAN GREGG: Here.

MR. WILLIAMS: Assemblyman Geist.

ASSEMBLYMAN GEIST: Good morning, everyone. I am here.

MR. WILLIAMS: Assemblyman Smith.

ASSEMBLYMAN SMITH: Here.

MR. WILLIAMS: Assemblyman Egan is not here. Assemblyman

Cohen is not here.

Vice-Chairman Sarlo.

ASSEMBLYMAN SARLO: Yes.

MR. WILLIAMS: And Chairwoman Friscia.

ASSEMBLYWOMAN FRISCIA: Here.

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Before we start, we have a great deal of testimony today, so Iím

going to ask you if you have written testimony, please donít read it to us.

Submit it, and if you want, you can give us a synopsis of what it is you have

submitted. Otherwise, we will be here through dinner time.

Iíd like to start off with Gale Tenen Spak, from University Heights

NJIT in Newark.

Gale.

G A L E T E N E N S P A K, Ph.D.: Since Iím the first--

ASSEMBLYWOMAN FRISCIA: Push the red button on your

microphone, Gale.

DR. TENEN SPAK: Now it is red.

Good morning, everyone. I have submitted written testimony, so

I will not read it all, but I will give you the gist of it.

I really am pleased to provide a higher education perspective on the

three requested subjects.

The first subject was where New Jerseyís growth areas and skill

demands are. Basically, Iím going to refer you to a new publication that, Iím

sure, each of you will be getting, which will be coming out on Saint Patrickís

Day, and it is our new Presidentís annual report. I think you can tell from itís

title, which is, "New Jerseyís Catalyst for Prosperity NJIT," that it is filled with

the information that is germane to the subject of growth areas and skill

demands.

So just culling, very briefly, from that report to answer this -- to give

my testimony on this subject -- I picked four different areas that NJIT believes,

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from the higher education and technological perspective, will be critical growth

for our State.

The first is biomedicine, which is the integration of medicine and

biology for engineering, computing, and mathematics, for the purpose of

bringing about advances in the diagnosis and treatment of disease. I think you

all know what it is, but Iíd like to list the names of the current job titles in

which the skills to do this work in this area currently reside. They are

epidemiologists, bio-statisticians, bio-mathematicians, computational scientists,

environmental scientists, and bioMEMS experts.

Another area of growth that we have identified is defense and

homeland security technologies. We all know why we need to have

advancements, unfortunately, in that area. But the occupations -- the

professions today where strides will be made, from a technological point of

view, reside, for example, in physicists, chemical computing, transportation

engineers, biometricians, etc.

Another area is MEMs fabrication and nanotechnology. I wonít go

into detail what those are, but let me tell you the job titles and the skills, and

theyíre not going to be surprising. They are, of course, the electrical, chemical,

mechanical, and computer engineers and physicists. And these are the ones that

will make the new products that will drive important industries to New Jersey,

such as pharmaceuticals, food, agriculture, ceramics, electronics, specialty

chemicals.

And finally, Iíd like to add, as an example of what would be a

growth area for our State, innovative learning systems. And this is very germane

to the topic today, as well.

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The development of innovative learning systems depends on the

skills of computer engineers, computer scientists, information scientists,

constructional designers, educators, and psychologists, because these are the jobs

that will be developing approaches to educating both our youth and our current

workforce so that each, in their own ways, can rapidly and broadly and fully

comprehend the knowledge necessary to advance the growth industries.

So thatís a smattering of what we consider to be the growth areas.

Your second question -- Iíll be briefer on that -- how to match the

stakeholders in these growth areas with opportunities for excellent careers. First

of all, from a higher education perspective, we believe that it is absolutely

crucial that all educational entities make sure that their educational programs

are sound. Thereís a whole definition of sound, but I think you know what that

means -- that they continue to serve a diverse population, because we -- unless

we enfranchise certain populations in our State, they will not be able to enter

this workforce. So we must make our -- serve a diverse population in every level

of education. And, finally, that these educational programs be available in

appropriate formats throughout an individualís lifetime, with the emphasis on

lifetime.

Another suggestion here -- how to make and advance people into

careers that lead to good employment and excellent results for our State-- Iíd

like to put on the table that suggestion to foster the development of community

informatic systems. These are also known as virtual communities. And this is

a wonderful way of matching the interest of people rapidly and completely.

Thatís now getting into a very popular use.

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Already, we have some Web sites in the State that are trying to

address this. Iím thinking of Workforce New Jersey and the State Employment

and Training Commission. But these are good examples of beginning industryspecific

-- the kinds of industries that Iíve just spoken about -- portals to things

like search methods, rťsumť posting, jobs that are available, resources, all to

connect the doers, the aspirants to these careers.

And a short bit on your third question, how our, in this case, higher

education system can work with all stakeholders to help prepare students to take

advantage of career opportunities.

In this short testimony, the written part, I mention 17 discrete

professions just in these brief words. To ensure that the current occupants of

people in these professions can acquire the new skills to move these industries

forward, higher education must teach these skills, this knowledge, in formats

which involve face-to-face and online learning that these professionals will find

convenient, meaningful, and responsive. This is a job that higher education and

other educational entities have to be more responsive to.

To ensure that the future occupants of these professions, who are

our students today, are ready to take their place in these industries, higher

education must involve employers in the curriculum-building process. Things

change so fast, and we need to change, too.

And we must involve the community and labor unions in the

process of helping their members understand the importance of continuous

learning, giving their members the wherewithal and commitment to prevail in

these higher education challenges, in face of the myriad of other commitments

and the ups and downs of just normal life in living in New Jersey.

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These are my suggestions. I thank you for the opportunity to

present them to you.

ASSEMBLYWOMAN FRISCIA: Thank you very much, Gale. It

sounds like NJIT is heading in the right direction.

DR. TENEN SPAK: We are trying.

ASSEMBLYWOMAN FRISCIA: Does anyone on the Committee

have a question or a comment?

ASSEMBLYMAN SMITH: Do you feel that, in New Jersey, the

primary and secondary educational levels -- the curriculum properly prepares the

students to go into NJIT?

DR. TENEN SPAK: No, absolutely not.

ASSEMBLYMAN SMITH: Okay. I guess my question would be,

if you had a magic wand, how would you change the current curriculum

structure in primary and secondary education to accommodate the needs of

NJIT, who, in turn, is going to produce the workers of the future? And Iím not

just talking about the low-level jobs, but Iím talking about very good jobs,

advanced degrees. If you could just--

DR. TENEN SPAK: I would be happy to comment on that. First

of all, there is legislation proposed to integrate the technology as a core

curriculum requirement, and this is key to answer your question.

But in addition to that, there are enormous opportunities to bring

to the attention of the youngest children in our state -- what it means to be an

engineer, what it means to be a computer scientist. What is nanotechnology?

We donít even know in this room. Iím sure I wasnít the only one, alone, who

didnít know it until I was exposed to it.

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And there are enormous opportunities to let our children have

experience, with hands-on acquaintance, with the industries that are doing this,

with the feel of accomplishment, with motivation to do it. The hands-on part--

Thereís also enormous opportunity to permit our children in the K-12 world to

do, what turns out later to be, research kinds of activities, questioning,

experimentation, experimental -- experiential learning. And these parts are not

in the curriculum. Thereís no room for that at times, and Iím sure youíre quite

aware of that aspect of it.

In addition, there are tools of technology, that I was referring to in

this brief testimony -- that would help our young children learn deeper, fuller,

more imaginatively -- that are not being tapped. Iím talking about, what use is

being put, in the classroom, of the worldís experts, that are available at a touch

of a keyboard, that can come in through streaming video into a classroom to

inspire kids to get them to really understand the possibilities out there? So I

would like to see more integration of the tools of technology into the everyday

learning, which means teaching the teachers and helping the kids understand

this, as well.

ASSEMBLYMAN SMITH: Can I just have one quick follow-up?

ASSEMBLYWOMAN FRISCIA: Sure.

ASSEMBLYMAN SMITH: There are a couple schools of thought

about primary and secondary education. And Iím certainly not an education

expert, but what Iíve found in talking to people is, a lot of people that teach

college level have some concerns about high school students graduating and not

having the basics that theyíve learned over the years, whether it be reading,

writing, math. And it seems like a lot of the schools -- maybe not to the extent

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that youíd like or the format that you would like -- are specializing, and when

you specialize, whether it be in foreign languages or any other subject area,

thereís less time being spent teaching basic education.

For example, when I was at Rutgers College, my roommates were

economics majors and engineering majors. But I found that they had a very

difficult time composing a simple, lucid paragraph, when it comes to writing. So,

I mean, how do you balance between the essential basics and the specialty path

that you speak of, because thereís so much out there to learn? Thereís so many

different areas, unlike 20, 25 years ago, when I was in school.

DR. TENEN SPAK: Itís a difficult question, but I would also

suggest that some of the new tools of learning could help make it possible for

people to acquire information from different subjects faster. Our brains are the

same, but there are -- we learn -- each of us learn differently, and some of the

tools that are being developed now actually speak to the various ways that

people learn. And if you are presenting information in a way that resonates with

an individualís personalized way of learning, theyíll learn faster. So it is the

tools that are being developed that, sort of, push information on English, if

youíre going to go into science, in a way that clicks. Iím talking about learning

clicking. So if it clicks faster, because we got the information in an appropriate

way to a personís way of learning, then they can learn more, because the bottom

line is, in todayís world, thereís more to learn. And that is what youíre speaking

to. Now, not only is there more to learn, it changes every few years, how much

more you have to learn. And thatís the continuous learning piece.

So I would say, further work in some of these growth industries, the

innovative learning systems, will help with this issue. I donít have any other

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easy answer, because you put your finger on it in how you cover everything that

needs to be covered. I say you can do it with some innovations that are out

there now.

ASSEMBLYWOMAN FRISCIA: Assemblyman Sarlo.

ASSEMBLYMAN SARLO: Just a quick comment.

Actually, Iím a graduate of NJIT -- proud graduate -- engineering

graduate of NJIT, and Iím glad to see what NJIT has done over the years,

because I remember-- Not that I was there that long ago, but when I was in

school there, both for my Bachelorís and Masterís, there was a lot more theory,

lot more formula and rationale, how to get to the problem.

But I just went back recently and spoke to a class about a specific

project, and I see, in my time that I spent there, theyíre dealing with not only

the formula and theory, but theyíre actually putting hands-on experience,

whether itís out in the field or on the board or on a computer, theyíre actually

seeing, "If I become a civil engineer, this is what I actually will physically be

doing," not just knowing the theories behind how-- And I think thatís

important.

And from the time I was there to today, Iím glad to see NJIT has

really made that transition of combining the theory and the rationale to the

actual hands-on experience. I commend NJIT on this.

DR. TENEN SPAK: And thatís an example of what I was trying

to say before. That helps. Thatís a style of learning thatís been advanced by

psychologists that says this helps the learning to happen faster, deeper, more,

and it could be done at the K-12 world, as well.

ASSEMBLYWOMAN FRISCIA: Anyone else? (no response)

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Well, thank you very much for coming, Gale. It was a pleasure to

have you here.

DR. TENEN SPAK: My pleasure.

ASSEMBLYWOMAN FRISCIA: Next, Iíd like Barrie Peterson,

from Seton Hall Institute on Work.

Welcome, Barrie.

And you have Burt--

Welcome, Burt.

Barrie, itís good to have you here.

B A R R I E P E T E R S O N: Thank you.

The Institute on Work was started in 1997 under the direction of

Ray Bramucci, a person Iím sure many of you know. We are oriented towards

ethics in the workplace, and creating opportunity and progression and economic

vitality for everyone. We are nonpartisan, and balance research with technical

assistance to, especially, local nonprofit and faith-based groups.

Our current projects include helping nonprofits create improved

temp-to-perm placement services. And weíre now currently, with the Prudential

grant, working with the Institute for Social Justice and the Regional Business

Partnership to conduct a survey of Newark employers -- an on-the-ground

survey to see what they need, how they access their talent, and are the current

employees residents of Newark, or of what area. So we hope to have that

completed in a month or two.

That, incidentally, is something I wish more of our workforce

investment boards were able to do, to particularize the employersí demand for

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talent in each locale. The BLS statistics are fine, but theyíre generally too

aggregated and too distant.

Our third project, at present, is to work with a health care union

and some hospitals, and Seton Hall Universityís nursing graduate program, to

come up with some solutions for the nursing shortage. And we have some very

creative collaborations starting there.

For your consideration today, the two most significant trends that

we see are in terms of ethnic change of our workforce and in terms of age

change. And related to this is the shift to contingent, nonbenefited employment.

The increase of immigration, whether documented or not, continues

to be felt. In fact, our population would be decreasing in New Jersey if it wasnít

for immigration. Thatís real clear from the new census figures.

This has several implications. We need increased need for ESL and

literacy, especially delivered in creative, forceful, community-based or faithbased

settings, with everyone welcomed at little or no expense. I think we ought

to have that as a goal. If weíre going to welcome immigrants and bring them

into our society to become productive, we need to equip them.

Secondly, many immigrants come with strong family ties,

outstanding skills, and a great desire to succeed. Thus, their self-employment

and entrepreneurial skills should be honored, and the public policies and the

nonprofit and faith-based groups continue to aid them in expressing this positive

energy.

An example is the work of Burt Sutker of Edison, who is

accompanying me today and will say a few words, who has aided hundreds of

people from many counties -- countries with microenterprise development via

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the Jewish Family and Vocational Services, Elijahís Promise in New Brunswick,

and the International Institute of Jersey City, and the Princeton Library.

So, Burt, do you want to just say a couple of words about how

youíre able to help new immigrants become self-employed?

B U R T S U T K E R: Thank you for allowing me to be here. If I appear just

a tad nervous, this is the first time Iíve had the opportunity of speaking in front

of a legislative committee.

ASSEMBLYMAN GEIST: Press your button. (referring to PA

microphone)

MR. SUTKER: Excuse me?

ASSEMBLYMAN GEIST: Press your button.

MR. SUTKER: I need to press my button.

ASSEMBLYMAN GEIST: Thank you.

MR. SUTKER: Iím Burt Sutker, as Barrie has said, and Iím here

with Barrie.

For the last four or five years, Iíve been involved with

microenterprise and self-employment as an alternate pathway to independence

for the refugee, for the asylee, for the inner city individual. Iíve worked with

groups of people from Liberia, Vietnam, various Hispanic countries, Russians,

Haitians, Bangladeshis. And in working with these individuals, you find that

theyíre absolutely wonderful people who only want an opportunity to their own

little piece of the American dream.

They come with all sorts of baggage. They come with different

economic and cultural systems. They come with no knowledge of how business

is conducted, according to law in New Jersey and in the country. They come

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with very limited levels of English competency, but theyíre wonderful people.

They are vocationally disadvantaged, not unlike many of the individuals in our

inner cities.

And over the last four or five years, Iíve helped these individuals

start hair salons, glazing businesses, import businesses, restaurant and food

service businesses, ethnic clothing, crafts and toys. Iíve even worked with a

street corner perfumer, helped people develop aroma therapy candle business,

carpentry businesses, cleaning businesses, lawn care, interior decorating,

bookkeeping, package delivery, and alike. These people do have a desire to

succeed, and all theyíre looking for is a little bit of help.

Prior to doing this, I spent 40 years with New Jersey companies. Iím

technically trained. I even spent a year and a half at the New Jersey

Manufacturing Extension program at NJIT, but I think I found my passion in

helping those who need help achieve their little piece of the American dream

through microenterprise and self-employment.

MR. PETERSON: Thank you.

Weíre engaging Burt to work with us and the small business

development centers around the state where Seton Hall and the SBDCs will be

providing nonprofits and faith-based and public groups with a, kind of,

mechanism to find out which of the people coming to them are good candidates

for self-employment. A lot of people have dreams, but youíve got to have the

right character set and resources to move ahead. So weíre going to try to put

together a service between Seton Hall and the SBDCs to discern who ought to

move in that direction. And then if they are that person -- with the resources for

them.

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We also, of course, work with the Entrepreneurial Training Institute

of the New Jersey EDA to help nonprofits get through business plan writing, and

weíve had about 30 folks start and about 20 graduate. And several of them

have multi-hundred thousand dollar loans to finance their start-up businesses

around the state. And about half of those are secular, and half of them are

nonprofit or faith-based. So weíre happy to be partners. And we see that as our

role at Seton Hall -- is to bring together different groups for the common good

and to try to break down some of these turf issues.

Moving on, the other immigrants, besides the ones that Burt is

talking about, are, however, being exploited horribly in many of our supposedly

finer communities as day laborers, or by bottom-feeding temp agencies in urban

areas.

Comfortable New Jerseyans-- We comfortable New Jerseyans need

to acknowledge that there are restaurant meals, landscaping, home improvement

expenses, convenience store and gas prices, nanny costs, and building cleaning

services -- are all cheaper, based on the backs of several hundred thousand

undocumented workers in this state. If we cannot look at this reality -- that

weíre all benefiting from their hard work and low pay -- then, really, weíre

saying that we want something for nothing.

If you public officials take no action on this situation, weíre really

saying that weíre going to worship the Darwinian jungle economy, and weíre

abdicating our moral, let alone legislative, responsibilities.

New York, for example, has stepped up penalties for an employer

for not paying minimum wages or taxes. Why canít New Jersey? Shouldnít we

be trying to enhance revenue to have the employers, who are supposed to be

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paying taxes, actually pay those taxes? This is not a matter of tax increase, this

is a matter of having a level playing field.

Further, these newcomer neighbors pay taxes exceeding their limited

use of services. Indeed, since half of the undocumented workers in the state

seem to be on the books, we are saving Social Security for the rest of us by their

contributions for which they cannot benefit.

Finally, we harass these essential workers, who are crowded into

small, unsafe apartments and forced to wait on the street for someone in a

pickup truck to come by, someone who, often, wonít give their name or phone

or address. So thereís little recourse for unpaid wages. Have we no shame?

Does the famous inscription on the Statue of Liberty mean nothing?

In Bergen County weíve begun, again, an effort to understand these

problems and create win-win-win solutions. In Rockland County, New York,

just north of us, the prosecutors have busted some of these exploiters for not

paying taxes. They claim they have no employees. Well, they do, and theyíre

having to be responsible now.

Can our Attorney General inspire similar actions here in New

Jersey? Can this Committee act on the bill that Assemblyman Geist introduced

a couple of years ago, which I think is now AB 3262, to address some of the

abuses uncovered by the State Commission of Investigation three years ago?

Itís time for action. Enough talk. Or is it okay in New Jersey for certain

employers not to pay taxes or wages? If I ran a legitimate construction business

or restaurant, Iíd be hopping mad that some low-life down the street was

undercutting me with impunity.

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Then there are the abuses of certain temp agencies, also cited by the

SCI report. For example, requiring a worker to report at 6 a.m., but not starting

the clock until 10 a.m., after paying the $5 for a ride in an uninspected, coyote

driven van to the job site and paying $5 to rent a safety helmet--

In California, there was a several-hundred million dollar classaction

suit against Labor Ready for all these unpaid wages between 6 a.m. and

10 a.m. Also, several states have found this firm guilty of fraud in miscoding

the jobs, claiming theyíre all secretaries, not asbestos removers, so therefore, you

get a lower workersí comp tax. So several states have found Labor Ready in

contempt and have recouped millions of dollars of unpaid workersí comp and

fines.

Has New Jersey investigated this corporate practice in the two

dozen offices this outfit has here, or is Labor Ready still refusing to show the

books -- last report I got?

The Arizona attorney general and laws of Texas, Florida, Georgia

ban Labor Readyís on-site check-cashing machines, another abusive practice.

There are other areas where the extension of the temp industry

beyond their legitimate purpose is cutting into our employment relations. The

Asbury Park Press has many stringers. They all work full-time, Iím told.

However, theyíre called independent contractors. Merrill Lynch has a large

mailing site in Piscataway -- largest mailing site in the country. Bus loads of

Dominican women come in from the Bronx every night, and there are charges

that there are very nasty things happening to these women late at night.

McCarter & English in Newark -- I had a report a year or two ago -- has many

full-time legal aides who are called independent contractors or who are temps

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there for a long time. These all represent possible revenue losses for the State

of New Jersey.

The California legislature, moving into another industry, has passed

a law banning temp agencies from the whole construction field, for neither the

agencies nor the contractor would take responsibility for OSHA, and therefore

OSHA is inoperable when you have an intermediary. The temp industry crowed

afterwards about successfully lobbying the governor to veto the bill. Rhode

Island mandates inspections of vans carrying temps, and prohibits fees for a

temp to get to the job site. Too bad Maine hadnít passed that law before that

van crashed into the water last summer and killed 15 temp workers.

Maybe if our Consumer Affairs Division had more resources to

oversee temp agencies, to educate both the workers and the employers of the

problems in the law, things could start improving. This, the Geist bill, begins

to address. Also, how can our Consumer Affairs Office continue to register

agencies whose main practice, now, has nothing to do with temporary work, but

happily supplies the big pharmaceuticals with perma-temps who are there for

years?

I have a proposal to fund this upgrade of service, for the Consumer

Affairs Office, and bring in revenues for our stricken State. How about a 5

percent excise tax on temp industry payrolls, which is about $2.5 billion a year,

annually, in this state? This puts a mild retardation on further growth of an

industry, which has mushroomed by helping employers "externalize their costs."

Thatís the way the business school folks talk about it. The employers are

externalizing costs onto us. For example, the $300 million, I believe it is, that

we steal from the Unemployment Insurance Trust Fund annually to bail out the

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uncompensated health-care costs of hospitals, which is driven higher every year

by the stripping out of health insurance for more workers. Only 7 percent of

temps, according the BLS, receive health insurance. This means that 3 million

temps in this country make up a chunk of the 41 million Americans who have

no health insurance.

The Institute on Work is a part of a Ford and Rockefeller-supported

national network, which is close to a partnership with a large national high-road

temp agency. We hope to secure foundation support for a pilot project to redo

the business model of the industry to put health insurance back into the picture.

Hopefully, as legislators, you will be supportive and not wait,

hoping Washington will fix this growing national health-care crisis. Iím not

talking about solutions looking for a problem here. Iíll give a specific example

of how this health insurance theft goes, right here.

Smithkline Beecham has 1,100 employees who are suing for the

health and pension benefits from the day they started working there as "temps,"

often several years before they were converted to direct Smithkline Beecham

employees. The expert opinion that Professor Paula Alexander, of the Seton

Hall Business School, and I offered last month, after reviewing about a two-inch

pile of documents, concluded that Smithkline was the common-law employer

and used various agencies as payroll vehicles. Itís no secret, many other New

Jersey firms, some considered gold chip ones, have similar practices, though

some have started, like Smithkline, to clean it up.

It is schemes like this -- the first oppressing the bottom of the labor

market, whether immigrants or modestly situated natives; and the second,

creating a shell game in corporate America -- which have largely eliminated the

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internal labor market. This made it possible, at one point, for somebody to

start out in the mail room and literally, with loyalty and hard work, work their

way up the Horatio Alger myth -- or dream. Now, itís a myth, because there is

hardly any internal labor market in the employers any more. There are rings of

contingent workers, which are barriers to getting into the real jobs of benefits.

We must focus on the quality of jobs, not the sheer number of jobs.

The New Jersey Department of Labor should, therefore, include a selfsufficiency

standard in its practices, giving employers with decent jobs help,

instead of trying to fit everyone into a job, any job. An indication of how the

growth of contingent work has harmed us all is seen in Princeton University

economist Alan Kruegerís study. He shows a direct correlation between high

penetration of the temp industry in the state to declining pay for everyone in

that state.

Letís see-- We have rung our hands for over 15 years here in New

Jersey about the loss of New Jerseyís manufacturing jobs. Those jobs with easy

access, regardless of your education level or even language, good pay, benefits,

often unionized, and stable jobs. Those good jobs that paid $16, $18, $20 an

hour and had a future, and you could build a life on, and, as my mentor Ray

Bramucci says, become a citizen based on that kind of job, and contribute.

Weíve rung our hands, because those jobs have gone away. But

have they really gone away? Several national studies show that half of the

apparent loss of manufacturing jobs really didnít go away. They were degraded

into temp jobs, or as the agencies call it, light industrial. Another reason to slow

the illegitimate growth of the temp industry, a growth which leeches off the

public workers sucked into it, and undermines public policy.

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Now I want to move to talking about the age factor of changing

demographics. One observation: the labor market participation rate for those

of us over 55 is zooming, while other age segments see fewer people working.

Yes, better health is a factor, but recently, economic necessity shouts out. The

corporate crime wave has, after all, trashed the retirement assets of so many of

these victims, that they are postponing retirement, while others are returning to

work, retiring from retirement. And when this happens, we have some real

crunches that occur.

I was at the Bergen One-Stop holiday party in December, and I was

confronted with a scary sight. The senior employment expert, Bob Higgins --

some of you may know him -- a mild-mannered gentlemen -- Iíve known him

for 10 years -- had smoke coming out of his ears. He was so upset. He wasnít

even at the party. He was in his office, where I found him. He was fuming,

because he, the day before, had been trying in vain to implement the WARN

Act. This is a Federal law, which says an employer must give notice and give

access to employment officials when there are layoffs of 50 or more. He was

trying to implement that law the day before and was not having success.

He had been trying to talk with Verizon, and Verizon blocked him

at every turn. "No," the company claimed, "We donít really have 50 being laid

off. We have 49 over here, 48 over here, 47 over there." So the WARN Act

didnít apply. I said, "Did you get Al Kroll on the phone to talk sense into

them?" He said, "Yes, but to no avail."

It gets worse. Verizon wouldnít even let the Department of Labor

officials on their grounds to try to get information to the workers on their last

day. Finally, the IBEW union worked it out for Bob to talk with some of the

21

workers at their union hall. Even from a business model, I canít understand

why youíd do this. I mean, this is a way to demoralize the surviving workers.

Iím switching my phone service in protest, incidentally. Hopefully,

Commissioner Kroll has gotten some response since this deplorable incident.

This affects, largely, older people, so the way we lay off people needs to be

looked at, and our responsibilities intensified.

At Seton Hall, weíre planning some extra services to help this new

demographic of older workers having to work longer. And with the Lily

Endowment grant, weíre stepping up our services for our alums.

One thought: Cross-cultural skills are needed, because the younger

workers tend to be people of color, different language, different style. So us

older workers are going to need to learn how to work with them if weíre going

to stay in longer.

One final comment. On January 16, several hundred of the leading

workforce experts from business, State, and county government, labor nonprofits,

and academia gathered at Rutgers. We were at the Douglas -- there.

The Governor and four commissioners and corporate leaders, plus Rutgers and

AFL-CIO leaders spoke a common mantra: training and skill development.

Many of you were there, remember. That was the theme for the day. It was

said that these would not only raise a personís pay, but attract or keep

employers in the state --- more training, more skill development.

First, I question this take. Many highly trained people are stuck in

pay and stripped in benefits due to some of the employersí schemes that I have

described. More training is not going to help those folks stuck in permatemping.

Also, New Jersey has about the most educated workforce in the

22

country to serve employers. So are we going to get an advantage by having an

even more educated workers so the companies will stay in New Jersey?

The biggest disconnect, however, is that even if we accept the

Governorís claim that higher skills mean more pay and more employers in New

Jersey -- even if we accept that claim, we still have no consumer report card on

training providers, after nearly five years since the Workforce Investment Act

mandated this.

So weíre going to stress training, but, yet, we donít know whether

the training providers -- what they do and the quality of their outcome. It seems

to me there is a disconnect here.

Now, I donít have a doctorate in economics or public policy from

Rutgers, but I do have some common sense. I do know that Henry Plotkin and

the Heldrich Center have a tough job here in producing this consumer report

card. And he says they hope to have it out by July. I would support anything

that we can do to help get that in place.

As we are learning, it was easy for the conservatives in Washington

to insist on choice, with the vouchers, to supposedly pick the best training

school -- and that market would, somehow, make for better products. That was

easy to mandate, choice. But to generate the information, upon which efficient

consumer choice must be made, as we have found here in New Jersey, is much

harder. And until that is completed, choice remains an ideological sham.

Thank you.

Any questions?

ASSEMBLYWOMAN FRISCIA: Thank you, Barrie.

Any questions? (no response)

23

You touched on something that we have had a discussion on in the

past, and thatís the temp agencies. And hopefully, at some point in the future,

we can zero in on that. Weíll be in touch.

Thank you, Barrie and Burt, for coming.

MR. PETERSON: Thank you.

ASSEMBLYWOMAN FRISCIA: Jeff Stoller and Libby Vinson

from NJBIA.

J E F F R E Y S T O L L E R: Thank you very much, Madam Chair, for this

opportunity to come in and speak to you.

Libby Vinson is our Assistant Vice President for Education Issues.

And I, of course, work with the labor and employment side, and we have a lot

that overlap on this topic.

I just wanted to thank you and the Committee for calling attention

to the skills training issue. Itís something that, I know, Labor Commissioner

Kroll has been working on to really stress as one of his top priorities. And itís

great to see the Legislature stepping up, as well, to call attention to this

situation, which we do regard as a crisis.

We know itís hard to believe, in this kind of economic slowdown,

that there could be vacancies with employers that are going unfilled, but the

reality that we are reminded of, week in and week out, is that -- while, when a

vacancy becomes available, itís usually quite easy for employers in New Jersey

to generate applications and calls and rťsumťs -- that there still can often be a

problem finding people who are coming in with the appropriate skills to do that

job and be able to get that employment.

24

And one of the things that has certainly been a trend, that is clear

to us, is that even what we used to think of, even just a few years ago, as the

entry-level jobs or even the "unskilled jobs" now require higher levels of skill --

in terms of computer knowledge, of literacy in general -- technical skills that you

wouldnít have imagined, even a brief time ago.

One of the bits of information that we get each year is that -- we

survey our full membership, which is now 19,000 companies, and we have a

percentage responding each year to our business outlook survey-- One of the

questions we ask year in and year out is, what are your biggest business

problems? And just two years ago, in 2001, difficulty finding skilled labor came

in third behind health-care costs and property taxes, which means it was a huge,

huge issue. Seventy-three percent of our employers, at that time, were having

trouble finding skilled labor, and 62 percent were having trouble finding

professional and technical skilled workers.

And the thing that struck us is, even a year later, in this most recent

survey that we released at the end of December of 2002, showed that even with

the continuing slowdown, 67 percent of our employers continue to report having

trouble finding skilled labor. And it really seems to us that this is something

that we all need to continue working on, because when we look at the big

picture, what we consider New Jerseyís key economic competitive advantage,

versus other states, is our workforce. You can find other places where you can

have cheaper housing, you can find other places in the country with lower energy

rates or things like that, but the thing that has always trumped those concerns,

in our minds, is the fact that New Jersey really has an unprecedented

concentration of skilled workers at all levels -- skilled trades, skilled preparation,

25

great educational resources -- as you know, Madam Chair. And weíre afraid that

if we lose that, if we continue to see this gap growing between what New Jersey

employers can find, in terms of filling those vacancies, we are losing not just key

workers and key opportunities, we really are missing the boat on one of the key

economic development tools that we have for New Jersey, one of our main

advantages.

And I think one of the things that we are concerned about is -- as

we reach out to the schools, the parents, the community -- I think both the

business community and organized labor have a message to convey, which is

that, just as we heard, thereís going to be opportunities through NJIT for some

of the high school areas. But many of our employers believe there are great

opportunities that are being missed, in terms of a wide variety of areas that,

maybe, require something less than a four-year college degree, but can lead to

the high-skilled jobs, the high-wage jobs, the good-benefit jobs that weíre all

trying to create and move people into.

Even manufacturing, for all of its tough times, we find one of the

latest surveys showed that average salaries in manufacturing still are 22 percent

above other sectors. Thereís really a reason to look at the fact that employers

are saying, "Weíre not able to fill some of these technical jobs." And I believe,

if we will be hearing later from AFL-CIO-- I think one of the things they report

is apprenticeships for very promising, high-skilled, lucrative professions are also

having a hard time getting the new blood in and getting people to fill those

opportunities. So, clearly, this is a situation we want to respond to.

And just briefly, two of the things that we have been involved in as

an Association, in reaching out in partnership, as Libby will discuss in a minute,

26

with other groups-- We are thinking that thereís two things we really must do.

One is to have a clear strategy, in terms of addressing the skills gap, and looking

ahead to where the growth is going to happen.

We are working with the State Employment and Training

Commission. I know Dana Egreczky, whoís here from the New Jersey

Chamber, is also working with Henry Plotkin and that group. And very much,

as we heard from NJIT, there are clearly identifiable industries that we believe

represent the best bets for the future, whether itís finance, logistics,

infrastructure, the needs that are going to continue to grow in health care, and,

yes, even manufacturing and pharmaceuticals.

The thing thatís interesting about the project that SETC is

undertaking is, while they are certainly looking at those high-level, high-skilled

technical and scientific jobs, the engineering jobs and so forth, they are realizing

that, for each of those growth industries, there are going to be opportunities at

all levels of skills. And thereís going to be important need for entry-level skills,

for mid-level skills in support roles for any of those industries. So I think it

would be misleading to think that the only people in New Jersey who will have

opportunities in the future are people with a doctorate in a technical degree --

in a technical area, rather.

So, again, I think we can learn from the experience that other states,

and even over in Europe, have found out: That if we can identify the kind of

key skill clusters that are going to be in demand, that even as specific job

opportunities change back and forth, we will be much more responsive, much

more able to move our students and our experienced workers to where the new

27

opportunities are unfolding. And the pace of those opportunities is moving in

a very rapid clip, as you know.

And the second and final point Iíd make is the importance of

restoring the funding that we have put forward, as employers and employees

here in New Jersey, for the workforce development partnership, specifically the

customized training program. It was just 10 years ago -- and the OLS staff

knows well, and other members of the Committee, because they were there in

1992. Both NJBIA and the AFL-CIO worked together to expand the customized

training program that was then a $2 million program, and voluntarily agreed to

set aside some of the money that would traditionally have gone to the

Unemployment Insurance Fund, and dedicate those moneys to customized

training. And they were targeted specifically for higher-wage salaries, to make

sure that we were training people for jobs that would be in demand, that would

have very close to 100 percent placement. You would be training people for

jobs that would be there, ready to start.

And in the years that have gone by, it has not just been to provide

matching grants that help us prepare workers to stay on the job and deal with

new technology, but also it has been expanded to address some of the areas that

you just heard, from Barrie Peterson, are increasingly important -- funds to

provide English as a Second Language training, and the like.

So we believe this has been a great program. Weíve retrained

hundreds of thousands of New Jersey workers. Weíve leveraged millions and

millions of dollars in matching grants from employers who put their own money

on the table to make sure that these programs operate.

28

But the threat -- and you can see it from the information I just

received this morning, about the pending transfers from these related programs --

is really quite disheartening, because we believe this money would get good bang

for our buck. These moneys really are helping people move into the growth

areas. And if we continue to divert that money for various purposes, no matter

how worthwhile, I think weíre really undercutting a great source of revenue from

the private sector, from the employees that have put money -- where the State

hadnít put money -- back in 1992.

To that extent, we have partnered with the New Jersey Council of

Colleges. We have created, at our own expense, a brochure promoting the

customized training program, directing people to the resources in each county

where they can plug into that great program.

And I would simply end by asking that the Committee keep an eye

on that program as we go ahead into the budget session, because those are

dollars that really are helping people move towards those growth industries, into

those new jobs that we are creating. And we think it would be a tragedy to

undermine that movement with money that the public has provided on its own,

essentially.

With that, I just wanted to briefly hand it over to Libby, to talk to

you about that final point of the focus of this hearing, which is, how do we

reach out in partnership to the community and make sure things are moving in

that direction.

E L I Z A B E T H V I N S O N: Thanks, Jeff.

29

It is a critical component to look at, also, primary and secondary

education, as how they prepare students for the workforce, whether they go

directly to workforce or to a community college or on to higher ed.

And as Jeff had mentioned, the demand for technical skills, on all

job levels, is escalating. But despite these numbers that Jeff had mentioned, and

Iíll also refer to a few, research is showing that students are opting out of math

and science and technology courses early on in high school. Luckily, the

Legislature and also the Department of Education is focused on a technology

education and computer literacy standards.

I just want to note, and thank, Assemblyman Geist for all of his

work in this area. He was the sponsor of a piece of legislation that would enact

technology education standards.

And why this is so important is, technology is not just computers,

itís essential to sparking interest in math and science careers by showing how

those are applied in the real world. Itís an applied science, really. And it shows

that if students arenít engaged early on, they will not be majoring or looking at

those fields later on in college. And we had heard from NJIT, and that seems

to be the case.

One of the things that we now need to do is look at certification for

teachers, ensuring that the teachers are trained in this area. And New Jersey,

since 1985, has been giving technology educators an industrial arts certificate,

even though theyíre no longer trained in industrial arts. Thatís certainly

something that we need to deal with here in the State. It keeps, sort of,

technology where -- at a lower level than it should be, and it puts us out of line

30

with our neighboring states. So Iím hopeful that that will move forward, as we

have been successful in moving forward with the tech ed standards.

Another concern for us is looking at advanced degrees in engineering

here in New Jersey. In New Jersey, we have about 2 percent of the engineering

graduates. Thatís what we contribute here in New Jersey. And at the national

level, fewer than 9 percent of Ph.D.s were awarded to engineering graduates, and

most of those were to foreign nationals that came here to study and left -- also

looking at the need to bring in H1B Visas to bring people here shows that we

need to do a better job of training those people here.

One of the problems is New Jersey also suffers from an outmigration

of brain-drain. Part of itís, obviously, geography. Weíre a small

state. A student wants to go to college -- two hours, youíre out of the state. But

what some of our neighboring states have done is provided incentives to

students -- to stay here in New Jersey and go to school. Now, certainly, under

the current budget constraints, thatís probably not an option. But Iíll just make

you aware that there is a bill, that Assemblymen Doria and DiGaetano have

introduced, that would create a loan redemption program for students that

would major in math, science, technology fields, granted that they stay here and

seek employment in the state.

Research shows that if you go to a school, you tend to stay and

work in the area in which you go to college, so we should look -- try to keep the

best and the brightest here in New Jersey.

Internships are another great way to train and attract future

employees. And weíre very pleased that the Governorís announced the senior

option program, which would allow seniors that have passed the high school

31

graduation requirements to take a senior option, working either in a community

center or an internship with employers. And weíre going to be working with our

membership to get partnered with our local school districts. Itís a terrific way to

expose students to the world of work.

And, also, what we hope is that, on the teacher training side, that

there -- more professional development is in this area, so they understand what

happens in the place of -- the workplace and the trends and the growth areas.

Itís just as important for them to understand, as it is for the students, or even

more so.

And, finally, literacy. The Governor, of course-- This is one of his

main issues and near and dear to his heart. Currently, in New Jersey, there are

1.4 million adults in New Jersey that are functionally illiterate. And the U.S.

Department of Labor shows that these costs cause -- these illiteracy costs -- U.S.

businesses about $225 billion a year in lost productivity.

The National Association of Manufacturers, in 2001, did a study

on this issue, and 32 percent of their members noted poor reading and writing

skills as a serious problem. And nearly half reported serious shortfalls in basic

written language and comprehension skills.

So we look at advanced math and science, and promoting that. Itís

also very important that we look at the basic skills. And the Governor, of

course, has put this at the top of his agenda. But BIA is working with the New

Jersey Reading Association to help create literacy benchmarks, enhance teacher

training in this area, professional development, so on and so forth. This is a key

element.

32

And, really, forums such as this, getting businesses and colleges and

the labor unions together to talk about this, really, will move us in the right

direction. I think the Department and the Legislature has been more receptive

to bringing the business community into discussions such as this -- as education.

A lot of times, itís been fiefdoms. And I think now that weíre coming together,

weíre seeing how we can move the state forward and how important this issue

is.

So I thank you very much for providing this forum.

ASSEMBLYWOMAN FRISCIA: Thank you both for your

testimony today.

Are there any questions from the Committee?

Assemblyman Geist.

ASSEMBLYMAN GEIST: Thank you, Chairwoman.

First of all, thank you for your testimony. Thank you for the

reference to the bill. Thank you for helping to put it on the Governorís desk.

On todayís topic, you reference a bill -- and I just learned from

Assemblyman Ahearn, who I believe has a companion bill -- that today, in the

Committee, is the legislation to eliminate the industrial arts endorsement

certification requirement.

MS. VINSON: Right. That bill, actually, I heard, probably will

not be heard today. The State Board has been dealing with this issue for some

time. So I think there are some issues that need to be worked, and I heard that

it is not going to be heard today.

But itís something that, certainly, needs to be addressed, because,

like I said, since 1985, New Jersey colleges and universities have not been

33

training industrial arts teachers. Yet theyíll go through the technology education

program, and they keep -- they receive the industrial arts--

ASSEMBLYMAN GEIST: I agree. We have moved from the

industrial revolution to the technological revolution.

I thank you.

Chairwoman, Jeffrey Stoller, as always, enlightens this Committee

and references the Governorís proposed budget.

And, Jeff, I think that those in attendance and those on this

Committee have the right to know more about, what you reference as some

concerns about, diversions seem inconsistent with the objectives of the

Chairwomanís forum today. Am I correct there are some diversions within the

budget?

MR. STOLLER: Well, I must say I just saw this when I first arrived

at the Committee. I was able to get, from the OLS staff, a summary of what

appear to be major transfers of money that would be affecting everything from

the unemployment fund, but more specifically, the Workforce Development

Partnership Fund, to the tune of $62 million. Again, this is the first Iím seeing

these numbers. But I would just highlight them, because they do tie in.

This is money that, we believe, originally became available back in

í92, during -- í91, í92, during that recession, because the State came to the

private sector and to organized labor and said, "Weíve got a great program. You

know we donít have the resources." And thatís when we made this, really,

revolutionary step of saying, "This program is so good. Our employers and our

unions feel so strongly that this customized training program, at the $2 million

level, has such value that we will agree to have some of that money put

34

forward." And it just is sad to see that that money, over the past 10 years, in

smaller amounts, has often been diverted. And, again, I canít vouch for the

final figures here, but if itís $62 million, I donít know that the program itself is

generating much more than that.

Again, I would think itís a shame, because Iím sure there are other

worthy, urgent priorities for the State. But Iím just saying, when you take the

money out of the customized training area, youíre talking about dollars that just

have tremendous impact, because, again, a customized training situation, most

frequently -- especially the employer-based training that weíre talking about --

you are training the worker whoís there, or a new person coming in, or a

displaced worker. Youíre training them for a specific opportunity, in most cases.

There are very few other programs I can think of where you can get 100 percent

placement for your training dollar.

So, again, weíre just saying we understand everyoneís sacrificing

across the board. We would just say this is a program that generates money

from the State. It doesnít cost money from the State. And if we divert this off

for other purposes, I just think weíre going to have a net loss, in terms of the real

impact on workers.

ASSEMBLYMAN GEIST: Through the Chair, this month you

begin your forums. I think you have one March 28, where BIA goes throughout

the State. Could you, through the Chair and to this Committee, provide your

synopsis relative to these proposed -- and reallocations of resources?

Today, I see the Unemployment Compensation Fund, Workforce

Development Partnership Fund, State Disabilities Benefits Fund, Stock

Workersí Compensation Security Fund, Second Injury Fund -- these are funds

35

that may be impacted by the proposed budget. And through the Chair, if you

could let us know your thoughts sooner than later so we can, perhaps, be

advocates.

MR. STOLLER: Weíll certainly take this back this morning.

ASSEMBLYMAN GEIST: Chairwoman, I worked on, as you

know, workforce development legislation. And, through the Chair, if that may

be appropriate, if the Committee could learn more about these--

And I thank the Chairwoman.

ASSEMBLYWOMAN FRISCIA: Thank you.

Thank you, both.

Any other questions? (no response)

Thanks.

MR. STOLLER: Thank you, Madam Chair.

ASSEMBLYMAN GEIST: Thanks, Jeff.

ASSEMBLYWOMAN FRISCIA: Mike Egenton and Dana

Egreczky, from New Jersey State Chamber of Commerce.

Welcome.

M I C H A E L E G E N T O N: Thank you, Madam Chairwoman,

Committee members. I appreciate the time.

I thought I would, actually, just introduce Dana here. I know

many of you are familiar with my day-to-day activities. And I thought instead

of listening to my wisdom, I thought I would bring the Chamberís resident

expert, in-house, on workforce development and give you folks an update on the

great stuff that Dana Egreczky and the Business Coalition for Educational

Excellence is working on.

36

So with that, Dana.

D A N A E G R E C Z K Y: Thanks, Mike.

Good morning.

This morning, Iím going to direct my comments to the beginning of

the pipeline in workforce development, the K-12 school system, because thatís

where a lot of our work is centered. And youíll notice that my testimony comes

with a lot of pictures, because I was a teacher for 16 years, and I know pictures

help. So Iíll walk you through a few of the things that the pictures tell you.

As Michael mentioned, we do do an awful lot of work in K-12

education and other workforce issues. Our K-12 efforts are done under the

banner of the Business Coalition for Educational Excellence, so youíll see that

throughout the testimony.

About 15 months ago, we convened a series of focus groups, and

we asked businesses what entry level workers were missing, and we came out

with a number of key findings. We had 100 business people attend our focus

groups, and Iíd like to share the findings with you. But Iíd also like to share

with you what weíre doing about it, what the Chamber has decided to do about

it.

Key Finding One: Without fail, the business people told us that no

matter how well-prepared the schools thought the students were, no matter how

smart the students thought they were, they could not apply their knowledge.

The application of knowledge to stuff in the real world was just not happening.

And youíve all probably run into this. The fast food server who canít make

change of a dollar, things like that. And the business community feels that the

inability to apply learning to the real world was a significant deficit.

37

What weíve decided to do, and we worked very hard to convince

the Department of Education -- and we worked with all the leading business and

education associations to make this happen-- We are integrating, into the

Stateís K-12 assessment system, a performance-based component. That is, not

only will students be taking the standardized tests in science and math and in

language arts, they will also be required to actually stand up and deliver a

speech, solve a hands-on mathematics problem, and perform a science

experiment.

The Business Coalition and the Chamber has actually put a

significant amount of money behind this effort to make sure that it happens and

it happens correctly. And we will be actually announcing the nine pilot districts

that will be starting this project within April -- some time in April.

Key Finding Two: The business community believes that there is

an unequivocal, rank order of importance in content-matter areas. More than

any other area, literacy is number one. And, in fact, the business people said

over and over again, if schools were to do nothing else, they need to teach kids

how to read, write, and speak. That was their unambiguous message.

Second in order of importance was mathematical skills, the

foundational skills needed to be adults in this society. And third was science.

And they werenít even sure about science, which actually breaks my heart,

because I used to be a science teacher. But they finally admitted that science

was important, only because -- if only because New Jersey has so many sciencebased

companies, and we need the workers for that.

But they were absolutely adamant about the fact that schools need

to assess children, in terms of their performance in these areas, and that all

38

schools and the State need to be held accountable when every child does not

come out of the schools fluent in language, ready to go in math and in science.

So what did the business community decide to do? Well, the

Chamber members decided that the first thing to do was to hold schools

accountable. And, of course, youíre, Iím sure, familiar with No Child Left

Behind. And, of course, that includes an awful lot of accountability measures

in it.

But we believe that the current accountability system in the State

is not fair, itís not relevant, and it does not promote continuous improvement.

When you look at the School Report Card, when it is released annually, what

you see is a rank order of schools. And are we surprised that Princeton beats

Newark every time? No, weíre not surprised. So the Newark isnít happy, the

Princetons arenít really judged against their peers, nothing really works well.

So Iíd like to point your attention to the third page, because we

intend to change the way schools look at the data on student performance. You

see on Page 3, a little bar graph. We have convinced the Department of

Education to send us the school data. And itís all public information.

Itís now in Texas, and itís being mounted on a Web site called Just

For the Kids. The Just for the Kids Web site reorganizes student performance

data on State tests in ways that are easy to understand, in simple bar graphs and

simple line graphs, so that you can track the schoolís performance, not only over

time, but in any given year, on any given test.

The red and blue bar graphs you see on Page 3 will be what you will

be able to see for every school in New Jersey, for every test the Department

39

offers. This happens to be the Goodman Elementary School in the Arlington

School District.

You can see there are three bars there, and let me quickly explain

what those are. The first bar is the scores of the students who took the tests that

day, the ones who were not absent -- rather, the ones who were absent and who

are not special needs, are not-- I mean, these are just the non-special needs kids.

So the first bar shows you, then, in the Goodman School, about 70 percent of

their kids did okay in the blue area. Another 20 or so did okay in the red area.

Actually, thatís passed proficient. But about 18 percent of their kids, the white

area left above the bar graph -- 18 percent of the kids failed, did not pass, were

not proficient.

Look at the second bar. The second bar reorganizes the same data,

such that only kids who have been with that school district for one year or more

are included in that thing -- because in all honesty, it is not fair to hold districts

accountable for kids who, sometimes, walk in the door, and take the test, two

days before the test is given. And we acknowledge that -- that we cannot hold

schools accountable unless you give them time to work with the kids.

The second bar is the bar that represents that work that school has

done with the kids who have been there more than one year. So you can see this

school does a lot better with the kids who are stable than with the kids who are

mobile.

But the final, the third bar, is the most critical bar, because this

database does something that has never been seen before. When you ask this

database to pull up a single school, it automatically also pulls up 10 schools

who have identical student populations, kids who are as difficult, equally as

40

difficult, equally hard to educate, in terms of English as a Second Language and

socioeconomic factors. And you then can see the third bar represents the 10

comparable schools, that is 10 schools that have identical types of kids. Look

how much better those schools are doing with those kinds of kids.

So if I am a school district -- a school in Newark, I can see Bar 3,

and I can say, "Oh, my. I havenít done half as well as I thought I was doing,

because, look, the schools here and there and everywhere, who have the same

kinds of kids I do, are doing better." I call up that school, and I find out what

theyíre doing.

In Texas, schools who use this information -- the schools who use

this to make the educational decisions are increasing student achievement by an

annual rate of 3 to 8 percent over schools not using the data on this Web site.

So we have great hopes for this in New Jersey, and we will be

launching this project next month. But the site will be password protected until

October or September, at which point we will open it to the public. And every

parent, every policy maker, everybody, every teacher can access every school in

this kind of a comparative analysis situation. We believe that this will promote

continuous improvement, and that all schools will achieve better results.

Finding Three: Our business people were telling us that, in addition

to language, science, and math, what kids were coming to them having no clue

about was the work ethic. And if I have heard this once, Iíve heard this 155

times. These kids donít know what it means to come here and to be on time.

And, of course, Iím talking about the greater majority of employers who hire

part-time kids during high school and those who graduate and go into entry-level

jobs.

41

So we established a program called School Counts! I donít know

if youíve heard of it, but we are going to be pushing this very hard in the next

year. School Counts! is a program -- you can see the credential down below. It

awards a credential to a student who achieves the four criteria next to the

picture.

Students must achieve a C or better in every class, must maintain

a 95 percent attendance and punctuality rate, must complete high school in

eight consecutive semesters, and must take more than the minimum number of

credits required for graduation. If they do all of that in every year, they get a

different colored certificate.

Employers can then say to the kids, "Show me your School Counts!

certificate." And if a kid doesnít have that certificate, it tells the employer that

he wasnít on time, she wasnít there, she was absent regularly, she didnít try very

hard. So the employer, then, gets a better sense of the child he is about to hire.

In states where employers use these kinds of student performance

records on a regular basis, not only do they find that their incoming workers

need less remediation, they find that in the localities where these kids are being

pushed to do more and to do better, enrollment in advanced math classes

doubles. So we believe that a program like School Counts! will not only affect

the employer community, but also positively impact education.

You can see that we have -- on Page 4-- We are moving on. One

of the things that we do is, of course, inform the kids that this is coming. You

canít make the kid change unless he or she knows that an employer is going to

say to them at the end of the road, "Show me your school performance record."

So you can see, we have full color posters that we slap up on the

42

walls of high schools. We have window decals both for the schools and the

employer. And, in fact, right now, you can see our School Counts! window

decals on the doorways of businesses like McDonalds, Wawas, ShopRites, and

many others, banks. We have 900 companies in the state who have already

said to us, "We will ask kids for the School Counts! credential."

In fact, in Cumberland County, this project has been so successful

that the county college stepped up and said, "You know what? We think this

is such an important effort that we will offer a full, two-year scholarship to any

student who has achieved the School Counts! credential every one of their four

high school years. We believe it will be better for our college population,

because we will need to remediate them less."

So right now, any student in a Cumberland County high school,

who achieves those four simple criteria -- and notice, theyíre not valedictorian

criteria -- will get a full county college scholarship. What an excellent incentive

to drive kids to doing it right the first time, to being in school every day, to

learning what they need to learn every day.

We think that is such an absolutely wonderful incentive that weíd

like to see it spread across the state. And weíd like to thank Assemblymen

Nicholas Asselta and Joseph Malone for introducing Assembly Bill 2932, which

calls for the establishment of a School Counts! scholarship.

Budgetary issues aside, some day we believe that when this bill goes

through, it will drive the workforce and students to perform in ways that they

havenít done before. The bill provides up to $500,000 per county, if the county

raises a match on a dollar-for-dollar basis. And given that Cumberland County

has already raised $1.6 million for School Counts! scholarships, in Cumberland

43

County we suspect that the private sector will really step up to the plate and

support this initiative.

But our statewide advertising campaign is just starting. You will see

our PSA commercials very shortly on NJN and on various cable stations, but

Iíve also included, for you, a copy of our full-page newspaper ad -- our black

and white newspaper ad, which says to employers, "How much do things like

absenteeism cost your company? Start today to change tomorrow. Become a

School Counts! employer." So thatís how we were addressing that issue.

Key Finding Four: For the first time in our surveys, even sole

proprietorships, bed and breakfast companies, are saying that technology is

critical. So, four years ago, the Chamber approached the Department of

Education and started to discuss with them the possibility of elevating the level

of rigor in what was then the workforce Readiness Standards. We felt that the

computer literacy standards were weak and not rigorous enough, and we felt that

there was no focus given to pre-engineering. And as you heard Libby Vinson

mention, pre-engineering is very critical, and weíve been working with a number

of business associations, among them BIA and the Tech Council of New Jersey,

and all of the education groups, including the NJEA, PSA -- the Principal

Supervisors Association. Weíve all agreed to support technology education and

computer literacy standards, because no one can survive without them.

But the Chamberís decided to go further than that, because

standards without assessment -- thatís basically meaningless. You put a

standard in place, how do you know that someone meets it? So weíve devised

an assessment, an online performance-based assessment, that we will be using

with the Department of Education, called the Technology Challenge, to assess

44

seniors before they graduate from high school. Do they know word processing,

database, spreadsheets, etc.?

This is a performance-based test, which asks very unexpected

questions. For example, it does not say to someone, "Whatís a gigabyte?" We

donít care whether or not people know vocabulary. What it asks is, "Attached

is a document that lists 500 of the most commonly used baby names in America

in 1999. Put them in alphabetical order and tell us which one is number 299th

on the list." That is a performance-based skill. You have to know how to select

the text, sort alphabetically, number, and find an answer. So the technology

challenge will be one of the possible mechanisms for students to prove

proficiency in computer technology.

Finally, Key Finding Five: The business community unanimously

agreed that it is absolutely impossible for teachers who have never experienced

the workplace to be able to deliver workforce skills to K-12 students. But we

admit that at this point in time, thatís a goal that weíre not even going to strive

for. Instead, we have decided to strive for just increasing the quality of the

teacher population as a whole.

When we looked around to see how we might do that, we noticed

that there was a program out there called the National Board for Professional

Teaching Standards. The National Board credential is the equivalent of some

of the credentials that are available in business. For example, if you were to hire

a bookkeeper, it would be better if you hired a CPA. CPAs take an extra exam,

pass more -- a higher bar to be a CPA than a bookkeeper would. An engineer --

you can hire an engineer or you can hire a professional engineer, a higher

45

ranking, more tests, more things involved. The same thing is true of the

National Board for teaching.

Teachers who pass the National Board must, first, take a written

test in subject matter. Thatís a concept that teachers who teach science would

have to prove that they know science. Teachers who teach math would actually

have to prove that they know the math. Then they are evaluated by specially

trained peers to make sure that they know how to teach it. Knowing it isnít

enough. You have to know how to teach it. Thatís the good news. We are

supporting the National Board process here in New Jersey.

The bad news is that we have 98,000 teachers in this state. Only

50 of them, 50, have passed the National Board. Other states have thousands.

For example, in North Carolina alone, 3,600 teachers hold the National Board

certification, and 2,000 more applied for it in 2002.

Our rate for the National Board process is, literally, abysmal. And

Iím not saying that there arenít great teachers out there, but the teachers who go

for the National Board process put it on the line and say, "Iím going to prove

that Iím a great teacher."

And as you can see from the final page, thatís our ad, our

recruitment ad, towards the National Board process. Weíre asking that

teachers, before they demand more of their students, they demand more of

themselves.

So, as you can see, at the Chamber, we have not only assessed what

businesses seem to need and want in the incoming workers, but weíre also

responding very actively and in very many ways that we believe will change lots

of things going on in the K-12 system.

46

So thank you for your attention.

ASSEMBLYMAN SMITH: Madam Chair.

ASSEMBLYWOMAN FRISCIA: Thank you, Dana.

Assemblyman Smith.

ASSEMBLYMAN SMITH: Sure.

What is the cost of the national certification, the hours generally

involved, and how important is it to New Jersey administrators to have that

certification?

MS. EGRECZKY: The cost of the National Board process is

$2,300. Itís an application fee of $2,300, half of which is already supported by

Federal grants. So the average teacher, for about $1,150, can go ahead with this

process.

The number of hours involved is quite extensive. In fact, itís the

equivalent of about half of a Masterís degree, in terms of hours. The teacher

does an awful lot of work: does a 12-page analytical review of his or her own

classroom practice; has to do three, 20-minute videos featuring themselves

teaching in a classroom. But every teacher who has gone through it says it has

opened their eyes.

So if you want to equate value and impact, the National Board is

the best bargain for the dollar, especially when you consider the research that

indicates that there is absolutely no connection between obtaining a Masterís

degree and effective teaching. And yet, this State supports millions of dollars,

in terms of paying for teachersí Masterís work in Masterís programs.

ASSEMBLYMAN SMITH: Thank you.

ASSEMBLYWOMAN FRISCIA: Anyone else? (no response)

47

Thank you, both.

MS. EGRECZKY: Thank you.

ASSEMBLYWOMAN FRISCIA: Barry Semple, from New Jersey

State Council for Adult Literacy.

B A R R Y S E M P L E: Good morning, and thank you.

ASSEMBLYWOMAN FRISCIA: Good morning. Welcome.

MR. SEMPLE: Iím on the State Council for Adult Literacy, which

is the Council reporting to the State Employment and Training Commission.

We helped work on their White Paper: New Jersey in Transition, the Crisis of

the Workforce, as Iím sure all of you are aware of. Itís number one priority is

a reorganization of the basic skills, moneys that go out in this State from 24

sources in five departments. And that paper talks about the need for

streamlining and reorganizing those resources.

My second reason -- and Iím paraphrasing quickly -- and I only

gave you a page and a half to start with -- Iím paraphrasing quickly. Certainly,

Iím here first to support that concept, and I hope this Committee is fully aware

of that White Paperís 24 aid sources in five departments, with little relationship

to each other -- Education, Human Services, etc., etc. And the Governor and

the SETC have supported that idea.

Secondly, Iím here to underscore the problem of resources in the

area of adult literacy. And youíve heard several speakers talk about

immigration. Youíve heard them speak about the problems of English as a

second language. And a couple of them gave some statistics. Forty percent of

New Jerseyís adults function at a level of literacy beneath that required by the

48

labor market, 40 percent. Thatís by the National Adult Literacy Study that was

done by ETS and updated in 1998 -- 40 percent.

Five to 8 percent of that population are in programs each year -- 5

to 8 percent. Approximately 80 percent of those who receive Food Stamps or

Temporary and Needy are at those levels of literacy. Seventeen thousand

students, at least, drop out from our schools each year. In the urban areas, 40

to 60 percent of those kids read below the ninth grade level and find it very

difficult to succeed on a job.

The American Management Association reported -- and someone,

I think, gave that statistic -- somewhere near 38 percent of job applicants tested

by companies in í99 lacked the skills in reading, writing, and math necessary for

jobs.

The Governor has given us a top priority, the Department of Labor

has given us a top priority for the last five years. Funding for basic skills, GED,

have not had a penny of State money since 1986. The adult high school -- and

I hope Assemblyman Geist will make note of this, because he asked that

question-- One of the funding sources being transferred by the Governor right

now is the adult high school. There are 50-some of these, enrolling somewhere

between 12,000 and 15,000 adults, to get a regular high school diploma, not a

GED. That aid source was about 28,000. Itís been there, at least, 20 or 30

years. The Governorís recommending that be knocked down to 10,000 and put

into a lump sum.

Iíve got a letter here from a Toms River adult high school principal

telling me that his superintendent has already said -- and under that situation,

49

they will wipe out the adult high school that had 400 and some enrollees, right

now, and hopes to graduate over 100 people.

If adult literacy and English as a Second Language are a top priority

of this State, from the Governor on down, from commissioner to commissioner

-- if there hasnít been an increase in adult literacy funding, GED funding, since

1986--

I was State Director of Adult Education with the Department of

Education for 12 years, way back when. You can tell by the white hair. I know

the budget situation is critical. I know that little help is coming from the

Federal government. I know weíre really up against an incredible crunch. And

Iím glad Iím not sitting in your seat or the Governorís seat, because I donít

know what I would do.

The only thing I want to raise today is that budgeting is, really, the

bottom line of priorities. And if we keep saying that basic skills -- and a large

number of our people cannot read or speak English -- is vital to our economy,

to our workforce, and to our democracy, then I beg of you to give some thought

to that consideration.

Thank you.

ASSEMBLYWOMAN FRISCIA: Thank you very much for coming,

Barry.

Any questions from the Committee? (no response)

Eric Richard, AFL-CIO, and Christian Estevez.

E R I C R I C H A R D: Chairwoman Friscia, members of the Committee,

good morning.

50

My name is Eric Richard. Iím testifying with you this morning with

Christian Estevez, who is -- works with workforce development issues on a daily

basis within our office at the AFL-CIO. So, much like the Chamber of

Commerce before us, heís a lot more knowledgeable than I am on some of these

issues. So weíve brought him in specially to give some details on the particular

programs that organized labor is interested in.

However, before that, Iíd, of course, like to take the opportunity

to try to tie this in a little bit, legislatively, since that is my job, and say that itís

invigorating to see a lot of different groups come before you today and talk

about how much -- how important it is to treat workers properly, how important

it is to invest in training, etc.

With that being said, we ask those groups -- whether itís our friends

at Seton Hall University and others -- to come forward and support us on

various initiatives such as anti-privatization, anti-subcontracting, and living

wage ordinances, which, basically, will accomplish many of the objectives that

they specified in their testimony.

With that being said, Iíd just like to turn the remaining portion of

it over to my colleague, Christian Estevez.

C H R I S T I A N E S T E V E Z: Thank you.

Members of the Committee, good morning.

My name is Christian Estevez, and I am the Education and

Training Coordinator for the New Jersey AFL-CIO.

Thank you, Chairwoman Friscia, for the opportunity to testify

before this Committee to express our views regarding the changing demographic

makeup of New Jerseyís workforce.

51

Iíd like to start off by talking about what unions do to improve the

quality of life and the standard of living for all workers. Organized labor

protects working families in our stateís workforce through various activities,

including education and training. By pursuing internal initiatives, and also

through high-road partnerships with business and government, labor is

committed to strengthening our economy and our Stateís infrastructure in

ensuring that New Jersey remains a desirable place -- state for -- in which to

work and to raise our families.

Iíd like to speak briefly about the demographic changes, in terms

of sectors of employment. The task of meeting New Jerseyís workforce needs

has become especially challenging in the face of rapidly changing conditions

over the past two decades. While New Jerseyís workforce has increased by

nearly 1 million workers overall during this period, the State has experienced a

dramatic decrease in manufacturing, as many have mentioned here before. At

the same time, there have been remarkable increases in the service sector and in

construction industry.

According to the New Jersey Department of Labor, Division of

Labor Market and Demographic Research, manufacturing decreased by 42

percent between 1981 and 2001. In 1981, manufacturers employed roughly 29

percent of New Jerseyís workforce, and by 2001, only 11 percent of New Jerseyís

workforce was employed in the manufacturing sector. This follows a national

trend that has its roots in flawed trade policies and unfair trade practices that

put U.S. manufacturers at a competitive disadvantage, drive up the trade deficit,

and encourage American firms to move factories and jobs offshore. The

Economic Policy Institute estimates that the growth in U.S. trade deficits with

52

our NAFTA partners has resulted in a net loss of more than 750,000 American

jobs. This race to the bottom also forces workers remaining in New Jersey to

accept lower wages and decreased benefits as a way of reducing costs and

increasing profits for corporations.

During this same period that Iíve mentioned, construction

employment increased from 108,700 workers in 1981 to 161,000 workers in

2001. The private service sector experienced the most dramatic increase from

1.6 million workers in 1981 to 2.8 million workers in 2001. In 1981, service

workers already represented a little over one-half of New Jerseyís workforce. By

2001, service workers represented over two-thirds of the Stateís total workforce.

Itís quite clear that New Jerseyís made a tremendous shift from a

manufacturing-based economy to a service-based economy. And itís also

evident that construction trades continue to be demand occupations.

I would like to, now, talk a little bit about the demographic

changes, in terms of the minority workforce. Further changes occurred regarding

New Jerseyís minority workforce during the í80s and í90s. During this period,

women increased their participation in the New Jersey workforce by 27 percent

as compared to men, whose workforce participation only increased by 7.2

percent. When looking at increased workforce participation by race and

ethnicity, Latinos increased their total workforce participation by 160 percent

over 18 years. African-Americans come in second with a 64 percent increase

over the same time period. The increase for Caucasian workforce participation

was relatively low, at 5.4 percent.

The shifts in New Jerseyís economy away from manufacturing to

service-producing industries, as well as of the minority workforce, present special

53

challenges to our workforce development system. The huge increase in

workforce participation by Latinos, who have become the largest minority group

in the nation, has created a high demand for basic skills training, especially

English as a Second Language. Currently, many new immigrants remain

underemployed due to language barriers. The expansion of training programs

through the Supplemental Workforce Fund for Basic Skills can help many

workers move up in the job ladder to high-skilled careers that provide living

wages and good benefits.

In 2001, the New Jersey AFL-CIO lobbied aggressively in support

of A-3774, in which Assemblyman Geist and Assemblywoman Friscia were

prime sponsors. Governor DiFrancesco signed this legislation, and the New

Jersey State AFL-CIO continues to work with the Department of Labor to

implement this program. In fact, the New Jersey State AFL-CIO has staff who

are working to expand accessibility to such training by helping unions develop

and implement workforce literacy programs. These programs also provide

training in computer literacy, a skill that is becoming necessary in all aspects of

workersí lives.

The New Jersey State AFL-CIO also partners with the State in its

efforts to expand apprenticeship opportunities. As a member of the New Jersey

Apprenticeship Policy Committee, we have contributed to the development of

programs that have made apprenticeship opportunities available to more of the

Stateís workforce. The Youth Transition to Work Program has been successful

at exposing many high school seniors to the benefits of union apprenticeship

programs.

54

Unions have been especially successful in attracting more minority

students to apprenticeship through the YTTW Program. In their visits to high

school students, representatives from union apprenticeship programs have been

able to communicate how union membership raises workersí pay and narrows

the income gap that disadvantages minorities and women. Union workers earn

26 percent more than nonunion workers, according to the U.S. Department of

Laborís Bureau of Labor Statistics. Their median weekly earnings for full-time

wage and salary work were $740 in 2002, compared with $587 for their

nonunion counterparts.

The union wage benefit is even greater for minorities and women.

Union women earn 30 percent more than nonunion women; African-American

union members earn 29 percent more than their nonunion counterparts; and for

Latino workers, the union advantage totals 53 percent. Also, union workers are

more likely than their nonunion counterparts to receive health-care benefits and

pension benefits, according to the Bureau of Labor Statistics. In 1999, 73

percent of union workers in private industry participated in medical-care

benefits, compared with only 51 percent of nonunion workers. Union workers

also are more likely to have retirement and short-term disability benefits.

Most important, YTTW has helped dispel the myth that students

only have two choices, college or McDonaldís. Apprenticeship has been able

to be exposed to them as an alternate route to higher education.

While YTTW programs have done an excellent job in raising the

awareness of the benefits of apprenticeship in our public schools, the New Jersey

State AFL-CIO continues to support targeted efforts to make apprenticeship

opportunities available to women and minorities in the Stateís poorest urban

55

districts. Organized labor is participating with local community stakeholders in

the 30 Abbott school districts in developing the Construction Trades Training

Program for women and minorities, a program funded by the New Jersey

Department of Labor, through the New Jersey School Construction Initiative.

Working in consortiums with local school districts, community-based

organizations and faith-based organizations, unions help to identify and prepare

qualified women and minorities in urban communities for entry into registered

apprenticeship programs.

These feeder programs are essential in meeting the need for skilled

workers in high-demand occupations such as construction and

telecommunications. Additional efforts are necessary as we continue to expand

apprenticeship into new occupations, such as culinary arts and marine diesel

mechanics. Apprenticeship is spreading to new occupations, because itís a

training model that works. The challenge of matching public and private

employers and workers in high-demand sectors with the greatest opportunities

for careers with high levels of skill and earning power requires an increased

investment in programs that work.

Finally, I would like to briefly discuss this yearís proposed budget

regarding workforce development. The New Jersey State AFL-CIO is concerned

with the proposed cuts to the Workforce Development Partnership Fund that

finances programs such as those previously mentioned. Currently, the budget

calls for a $62 million cut to the overall WDP Fund. These programs contribute

greatly to the Governorís goal of developing a highly skilled workforce that will

help retain quality employers, as well as attract new employers to the State of

New Jersey.

56

While we are prepared to share in the pain of the budget cuts before

us, we want to work with the Governor in the future to ensure these important

programs continue, so that New Jersey can continue to move in the right

direction in developing the skills of our Stateís workforce.

Thank you, again, Chairwoman Friscia and members of the

Committee. The New Jersey State AFL-CIO appreciate the opportunity to

testify on such an important issue.

ASSEMBLYWOMAN FRISCIA: Thank you.

Any questions? (no response)

Thank you, both.

MR. RICHARD: Thank you.

MR. ESTEVEZ: Thank you.

ASSEMBLYWOMAN FRISCIA: Richard Santoro, from New Jersey

Retail Merchants.

And we have one more after this.

R I C H A R D S A N T O R O: Good afternoon, Madam Chair and

members of the Committee.

Iím Richard Santoro, from the New Jersey Retail Merchants

Association, and Iíd like to thank you for this opportunity to just give a brief

overview of the retail community and some of the steps weíre taking to establish

skill standards and training.

The retail industry plays an integral part in the Stateís economic

viability, as two-thirds of all economic activity is consumer spending. The retail

industry is the second largest employer of our Stateís citizens, with retail

compensation amounting to $13 billion a year. The industry employs almost

57

600,000 people. There are over 50,000 retail establishments in the State of

New Jersey, that generate over $80 billion in retail sales. With all these sales,

of course, retailers produce $7.9 billion in sales tax for the State, which is the

second highest form of State revenues behind income tax.

Retailing is a growing industry, as youíve heard, to switch from a

manufacturing sector to a service sector. This is occurring both in New Jersey

and in the United States. According to the U.S. Bureau of Labor Statistics, the

retail industry will grow from the 18 million jobs it produces now to a projected

25 million jobs by the year 2008. And based on the annual average growth rate

of 1.4 percent, which is higher than the growth rate for transportation,

communication, utilities, manufacturing, finance, insurance, or real estate--

With this incredible growth of the industry here in New Jersey, retailers certainly

have many jobs to fill, both in the stores and at the corporate level.

Retailing provides career opportunities for many special

populations, such as immigrants, minorities, and seniors, and helps them

become contributing members of the workforce. Retailers provide over 40

percent of students with their first jobs, have placed thousands of welfare

transitioners, and are developing targeted career options for the disabled, non-

English speakers, and senior citizens. In addition, retailers provide jobs for

people who are looking for flexibility in their work schedule during various

stages of their lives. As a matter of fact, I work part-time at a retail store on the

weekend. So it does fit my schedule, as well.

Something thatís always brought up with retail is wages. What do

wages look like at the entry-level? Well, certainly, there are some minimum

wage jobs out there. Increasingly, they are limited to small businesses. And

58

surprisingly, hourly earnings of non-supervisory retail workers averaged over $9

in 2001. Thatís the most recent figure I have.

One of the large retailers in New Jersey has reported to us that instore

salaries range from $48,000 to $150,000. Again, that $150,000 end is the

managerial store manager type of position. And the best part about this, I

think, is that a college degree is, typically, not required for these types of

positions. Over the years, with experience and with a lot of hard work, you can

definitely reach these positions.

I have a member on one of our committees who started working for

a retailer as a -- I guess he called himself a buggy boy. He used to go out in the

lot and collect the carriages when he was in high school. And now he is a

regional loss-prevention manager for a very large chain retailer. And thatís how

he started, pushing the carts around. Now he has a very solid job that pays him

well and that heís proud to do.

In addition to-- While these salaries are very competitive with other

industries -- and actually, the retail industry leads some of areas of the service

industry. And advancement opportunities and a variety of career options exist

in retail, as well. There are clear paths to the careers that are traditionally

associated with advancement in the retail industry, such as the system managers,

store managers, buyers, director of store operations, and so on.

As I said, with only a few years of experience, the store manager can

supervise over a hundred employees, oversee thousands of square feet of a

facility, and manage a budget of over a quarter of a million dollars.

There are many opportunities in retail, and I think itís, certainly,

one of the industries that is a gateway to employment. A lot of people start out

59

in retail. And within retail, the career paths lead to some opportunities that are

not as -- obviously in the store level -- but that still provide a lucrative career

track such as human resources, information technology, E-commerce, real estate,

and telecommunications, and the list goes on and on beyond the typical retail

employement.

One of the possible career paths that will begin with the position of

a sales clerk -- and thatís the typical entry level position in almost all types of

retailing. And with hard work and a commitment to the store team, it is

possible to be promoted from a sales clerk to one of the many retail options that

I just mentioned.

Overall, there are many areas or departments in retailing which

utilize entry-level employees, and they offer significant opportunity for

advancement. And you really would start off with a similar apprenticeship

program, as was mentioned earlier, except youíd be a retail management trainee,

where youíd learn a lot of the store operations and finance and marketing. And

from there, you can move up to being a buyer or a manager -- district manager,

and so on.

Of course, to be eligible for some of these opportunities, you have

to have basic skills. And as Assemblyman Smith had talked about earlier, the

retailer -- some of the retailers are finding that some employees do not come to

them with some of those basic skills, and therefore, they have taken that

obligation on themselves.

And in New Jersey, many young adults receive a basic education,

but I think as many as 11 percent donít graduate from high school. A large

number of these students have reading and math skills that are below the eighth

60

grade level. And without such basic skills, many of these people have difficulty

training for a job and have been categorically called unemployable. Yet, the

unemployable workforce, in an age where employees, especially retailers, are

having a hard time finding skilled employees, is a good labor source that they

can utilize.

And, therefore, retailers have taken it upon themselves to address

some of these discrepancies, and as the economyís leading creator of entry-level

jobs, in conjunction with the U.S. Department of Labor, has begun the

development of national skills standards for retail sales positions. Itís intended

to help students, job applicants, and employers by formalizing the requirements

for all retail sales positions, and these standards clearly specify the abilities,

knowledge, and skills that are necessary for success. Companies recognize the

need for a highly skilled workforce to compete in a good economy -- a global

economy, excuse me -- and will use the skill standards to evaluate and measure

performance.

And perhaps one of the best ways that we can see this working in

New Jersey is through the Retail Skills Center. The Retail Skills Center serves

as a one-stop career center linked to community-based organizations, job

training and placement agencies, area schools and colleges, and employers. Itís

a state-of-the-art education and training facility, which combines self-paced

computerized instruction with workshops, placement services, and on-going job

counseling and skill development.

Thus far, the skills centers have been phenomenal in preparing

workers for the retail industry. They provide training related to the skill

standards, encourage employer participation in mentoring and advancing jobs,

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and provide the counseling and logistical support to help people succeed in their

jobs. The Retail Skills Center up at Jersey Gardens, in Elizabeth, in one year,

brought over 7,000 people to job fairs and placed 2,500 workers within a few

weeks of the mallís opening. I think thatís definitely a strong sign of its success

right off the bat.

Therefore, in conclusion, the retail community in New Jersey, I

think, represents a model for empowering a diversified workforce to the retail

skills standards, through the Retail Skills Centers and training.

NJRMA aspires to play a valuable role in assisting a return to fiscal

responsibility and increasing disposable income through the application of the

retail industryís workforce model for the State of New Jersey. NJRMA possesses

particular success and expertise that follows the lead of Governor McGreeveyís

vision of building a world-class workforce, which is key to keeping New Jerseyís

economy on track.

Thank you for this opportunity today.

ASSEMBLYWOMAN FRISCIA: Thank you, Richard. A lot of

work went into that. Thank you for the stats at the end of your testimony.

Any questions? (no response)

Okay. Thank you for coming.

Barbara Tofani, from New Jersey Hospital Association.

B A R B A R A T O F A N I: I think Iím the first one that gets to say good

afternoon. (laughter)

Thank you for allowing me to come. Iím Barbara Tofani, and Iím

the Director of the Center for Nursing and Health Careers at the New Jersey

Hospital Association. Itís probably--

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Am I the last of everyone?

ASSEMBLYWOMAN FRISCIA: No, thereís one more.

MS. TOFANI: One more. Okay. Well, I think itís pretty

appropriate that health care is last, or close to last, because we actually combine

everything that youíve heard from the testimony this morning. We are certainly

a service industry that focuses a lot on technology and has significant issues with

the academic preparation of our entry-level employees, and also of our

professional employees, in terms of their verbal and written communication

skills and their math and science backgrounds. So I think all thatís been said,

certainly, can apply to health care. And anything that can help to better prepare

students will, certainly, help the health-care industry in the long run.

The health-care industry is facing a workforce crisis unlike any

other, in terms of the varied complexities and causes, and Iíll talk about them

in a minute. Professional staff are aging. There are more nurses, pharmacists,

respiratory therapists, medical laboratory technicians, radiology technicians

leaving for a lot of reasons, including retirement. Thereís more leaving than are

entering into the health-care field.

Social attitudes about working in health care have changed

dramatically, and young men and women are having a lot more opportunities

to work in a variety of fields, as youíve heard already this morning, and theyíre

not that interested in coming into health care. And Iíll talk about that very

briefly in a minute.

But as the supply of workers dwindles, the need based on an aging

population-- In New Jersey, in the past 40 years, our senior citizen population

has doubled. And remember that the seniors are the high-end users of health-

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care services. So as that population ages, and also as medicine has had great

accomplishments, in terms of the advances in medicine and the services that we

can provide, thereís a major disconnect between what we have, in terms of the

workforce, and what we need.

What I have done to make it easy on everyone is, I have given all

of you not only a summary of my comments, but a PowerPoint presentation

with statistics that talk to you about the demographics of the shortage, why

weíre in the position that weíre in.

In health care, we define a critical shortage as anything greater than

10 percent. And in nursing, radiology, many other categories within health care,

we are facing critical shortages of health-care professionals.

The other issue is that the pipeline is drying up, or has dried up. So

there are schools in the State of New Jersey that are either decreasing their

enrollment because they cannot get faculty, or theyíve closed their doors because

they havenít had the student enrollment to support the programs. Health care

programs are extraordinarily expensive to fund in the colleges and universities.

And if there arenít enough students interested in going into the careers, itís very

difficult to maintain and sustain those programs. We need to help to develop

an interest and an appreciation of health care at a much earlier age.

It was very interesting to hear from -- the presentation from the

Chamber of Commerce, that the business leaders could truly identify the need

for technology and the need for math in business, but they really couldnít put

a handle -- get a handle on why science was important, but they knew it was

important. Science represents the health and wellness of our community. I

mean, thatís probably the core of what we need in our community, because if

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we donít keep our community healthy -- and healthy communities come through

good science -- learning diseases, understanding disease process, learning how

to treat them and how to prevent them, especially. So it was interesting that we

couldnít place a finger on it. And I think that thatís one of the reasons why

weíre seeing a lack of interest in health care, because thereís not a real value

placed to health care right now.

The Hospital Association is working very hard to change that, and

we are doing quite a few things to get into the schools, especially into the

elementary and middle schools, so that children can be exposed to these careers.

We can try and overcome some of the stereotypes, especially with men and

health care.

And if I could just tell you a very quick story-- I was in a sixth

grade classroom a couple of weeks ago, and I asked the boys, specifically,

"Would any of you be interested in becoming a nurse?" And about half raised

their hands. And they gave me a lot of reasons. The pay sounds very good, it

sounds very flexible, it sounds like thereís great opportunity. They like the idea

of the technology and also of helping people. But one little boy tapped me on

the arm and said, "But letís face it, thatís where the girls are." (laughter) At this

point, anything we can do to change the perception at that grade level is terrific.

ASSEMBLYMAN GREGG: If it works, it works, right?

MS. TOFANI: But just getting the kids open to the idea that,

perhaps, this is a possibility for them.

So anything that we can do in the grade schools--

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Iíve also heard some testimony that talks about bringing technology

into the classroom and raising awareness with students about all careers through

technology. And there are experts. It was said before, thereís experts all over.

And one of the things that weíd like to do is bring the expertise of

the existing health-care community into the students, into the classrooms, and

perhaps try and establish some real time interactions with these kids, perhaps

broadcast surgical procedures right out of the operating room, real time, and let

these kids be hardwired through their classrooms to have conversations with the

surgical team to ask, "Whatís going on? Why are you doing that?" It not only

gives students an actual idea of what goes on in a surgical suite, which I call

little people area. Itís like a little people bus and a little people store. You go

through those operating room doors, and you have no idea what goes on. So

it takes some of the mystery away, but it also is a great opportunity to teach

kids about wellness, about taking care of yourselves, especially depending on the

cases that you select. If you select something with -- I am an oncology nurse by

background -- a patient whoís having some kind of a procedure for cancer, 85

percent of all cancers are caused by environmental issues, something that weíve

done, or our environment, or society has done. Talking to the kids about

substance abuse and tying those together--

Not everyone will be a health-care worker, and we recognize that.

But everyone will be a health-care consumer at some point in their lives, and

hopefully many will become health-care workers. Weíre looking to try and,

number one, establish an interest, not only in the students, but weíre also

looking to establish an interest in second-career seekers, people who might be

downsized from their jobs, people who might not have had an opportunity when

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they were younger to go on to college or continue their education -- and try and

provide some opportunities for them to work in an industry, again, that not only

is a service industry that really meets the needs of our community, but also uses

technology, math, science, and communication skills to really help them to

achieve what they, maybe, ultimately wanted to achieve in their life.

We are partnering with the chambers of commerce, we are

partnering with the workforce investment boards, we are partnering with service

and education to try and help the transition from the higher education programs

into the workforce environment. And we are doing a lot, but a lot more needs

to be done, not only today, but we need to sustain the effort. We need to

continue it into the future.

In health care -- and I donít know if this is similar in other

industries -- but in health care, the workforce shortage is cyclic. And any of you

who have been around for a while have heard about a nursing shortage in the

í90s, and in the í80s, and in the í70s, and in the í60s. This shortage is a little

bit different for a lot of reasons, mainly because of the demographics. There are

just more older people who are the high-end users than there are people coming

up, and because students have many, many, many more interests and

opportunities than ever before.

So what we have to do is take the people who are interested, or

might be interested, and to really make the most out of them and be able to

maximize those resources that we have. But weíve got to stimulate an interest

for these students, and thatís the only way health care is going to survive.

I just want to reiterate some of the skills that are needed in health

care, and itís been said before. But anyone, whether itís a student coming from

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high school or itís someone as a second career seeker looking for another

opportunity, needs to have a good math and science base. Do they need to be

brilliant in math and science? Absolutely not. But do they need to have a good

math and science base? Sure. And they need to go beyond those basic math

and science courses.

They also need to be technologically confident. They need to have

good computer skills, because everything in health care is moving towards

computerization. And so they do need to have great technology skills.

They also need to be self-motivated. They need to be critical

thinkers. They need those -- I think it was called -- the work ethicsí skills

training that the chambers of commerce talked about. They need to learn how

to come to work, how to come dressed appropriately, how to come on time and

stay until the work is done, and how to communicate with patients and

colleagues at all levels.

We are working with guidance counselors, teachers, recruiters,

human resource experts to try and help them steer those kinds of people, those

kinds of candidates into careers in health care.

Our efforts through the Center for Nursing and Health Careers at

the New Jersey Hospital Association have been very collaborative, have been

very comprehensive. But as I said, we need to do more. We have reached out

to 700 schools in New Jersey, and weíve already reached about 1,200 students

in elementary, middle school, and grade school, but there are tens of thousands

more students that still need to be reached.

I applaud your efforts to address these issues, and I welcome the

chance to work with you in the future to create some effective, sustainable plans

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to evaluate and connect these high demand sectors with confident, well-trained

employees.

Again, in your handout is a PowerPoint presentation. I think it

gives you a lot of statistics that might help as you move forward with your plans

to come up with a strategy. And I thank you for the opportunity to speak to

you.

ASSEMBLYWOMAN FRISCIA: Thank you for coming today,

Barbara. Itís a good presentation. We appreciate it.

MS. TOFANI: Thank you.

ASSEMBLYMAN GEIST: Thank you.

ASSEMBLYWOMAN FRISCIA: We have one other person who

didnít sign up, Harvey Steinberg.

Harvey, could you come up and give us a synopsis of your written

testimony, please?

H A R V E Y S T E I N B E R G: Yes, surely. My written testimony is already

a synopsis of many more pages, which I wrote up last night.

If youíll turn to the second page--

Let me just say, first, that -- for Assemblyman Geist, whoís going

out -- Iíve spent 12 years in the labor movement as a national vice president of

an industry union. I was a -- for Assemblyman Sarlo -- I was a professor at

NJIT for 12 years teaching management at all levels -- and a great deal of other

diverse background, especially in the field of human resources. I only say that,

because it will sound peculiar, in terms of what Iím about -- if I donít say that --

in terms of what Iím about to present.

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If youíll turn to the -- itís the second page Iíll start with. And Iím

going to do this anecdotally. Anecdotes are the stuff of which statistics are

made, so letís -- itís a little more personable, also. Iíll just read it out.

I know a boy who, since age 8, has shown a remarkable talent for

envisioning, assembling, and inventing mechanical devices. But he has hardly

anywhere to grow these talents.

In the old days, such children might have fixed their fatherís car

hands-on. And I want to support all those people who talked about hands-on,

because thatís where kids are at, thatís where growth comes from. Today, car

fixing, and almost all other opportunities for early learning of engineering, in all

its branches, is hands-off. And there are virtually no labs where such children

can indulge those talents, especially after school, and acquire a foundation for

natural exponential growth as they get into their high school years.

I went to Stuyvesant High School, by the way, in New York, which

was a premiere science high school in the country, probably together with the

Bronx High School of Science.

A basic message is that young children have tremendous

capabilities, which adults do not take into account. Give them junk work to do,

theyíll turn out the junk sought. Set them higher objectives and let them go to

work at it, theyíll love not only fulfilling the objectives, but will produce to their

fullest. In fact, theyíll produce amazing results.

Iíve seen it, for example, in the visual arts, in writing, in engineering,

and science. To anticipate an argument, doing so does nothing to diminish the

childrenís many other enjoyments of young life. Those kids are not nerds.

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Itís hard to get passed the wall of convention and habit to think

outside the box, but we must. The best of American industry was built by

providing opportunities for the unstandard.

What can New Jersey do about this, legislatively? In general,

develop the strategies for programs which will challenge children in hands-on

disciplines vital to our societyís future. Get the programs implanted into the

community through the school systems, but especially within appropriate

community nonprofits, where there is greater freedom for experimentation and

having fun while doing that. Iíve done a lot of that myself, and it works. Work

with labor organizations for their members to mentor these kids.

Iíll just leave that topic with that. Thatís on your third point of

excellence -- human excellence in the workplace.

Turning to the first page, and this I can, I think, shrink down a little

bit.

Again, an anecdote. This has to do with growth areas and skill

demands. Another story of a wholly different sort. I was the economic

development of the Hoboken -- Director of Hoboken, as well as his Deputy

Director of the model cities program for a number of years, which really took

the most dilapidated city in New Jersey and made it what it is today. And this --

I know what Iím talking about, when we think about the other item that I dealt

with.

Several years ago, I did a study on a pro bono basis through the

good offices of one of the Stateís major cities. That city desperately needed a

fuller measure of job opportunities for its large population of low- and semiskilled.

A small spark of creativity that I applied to a dry body of data lit up the

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possibility for the city to seek to proactively encourage the manufacturer of a

particular major product. In this case, of the component parts of pre-fab

housing--

The industry was, for example, a very substantial one in

Pennsylvania. There were no such facilities as I remember -- or almost none in

New Jersey -- even though New Jersey was one of the primary customers for

those homes. My study inevitably took me a bit beyond the dry data, all of

which firmed up a reasonably good prognosis for success. So far, so good.

It would have sat well with me if the cityís administration had

conscientiously reviewed the concept and, finding it wanting based on the facts,

had scotched it. But the city dismissed it without even a side glance at its

possibility. This happens a lot. It was no skin off my nose. Today itís a

growth industry elsewhere.

Elevating experience like this, multiplied by others, into a couple of

generalities -- and Iíve dealt with cities a fair amount, as I say, and intensively

in some cases-- In the smaller business sector, employment growth and skills to

support that growth are inseparable from governmental attention to the

entrepreneurial outlook -- and I say that coming from, basically, the labor

movement and my training in it. Which means, municipal administration ought

to put the relevant staffs to work proactively discovering, reaching out to

encourage -- encouraging and materially fostering niche industries realistically

and tenaciously -- and that word is important, tenaciously -- instead of waiting

for manna to fall from heaven. "Hereís money. Weíre giving it to you. Hereís

our industry. We want to come into your town." Well, what about going out

and looking for it where itís proper to do so?

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What can the State of New Jersey do about this, legislatively?

What can I say? I donít want to be abusive here, but wake up, city hall. And

Iíve been in politics, and I understand what they might say about that. But itís

really aside from politics that these things can get done.

Iím done.

ASSEMBLYWOMAN FRISCIA: Thank you, Harvey.

We appreciate your coming down. As I said, I didnít know you

were going to testify because you didnít fill out the form. But we thank you.

MR. STEINBERG: Well, Greg wasnít here at the moment.

Thank you very much.

ASSEMBLYWOMAN FRISCIA: Okay.

Motion to adjourn. Weíre done.

(MEETING CONCLUDED)