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Remarks prepared for
U.S. Secretary of Labor Elaine L. Chao
American Hospitals Association 2007 Annual Meeting
Washington, D.C.
Monday, May 7, 2007
Thank you, Rich. It's great to be here with you. Thanks for inviting me.
This morning, I'd like to talk with you a bit about the strength of the economy and what the Department of Labor is doing to increase the competitiveness of America's workforce and prepare more workers to the growing opportunities in the health care sector. And then, I would like to update you on pending legislation that has significant implications on workers' rights.
Today, America's economy is healthy and resilient. Despite rising energy prices and a slowdown in the housing market, the fundamentals of our economy remain positive. Job growth is healthy and wages are rising.
Our country's unemployment rate remains low at 4.5 percent. That's more than a full percentage point lower than the average 5.7 percent unemployment rate of the 1990s. You can contrast this with Europe. Let's just pick two countries. Let's say, France and Germany. These two nations have unemployment rates double that of ours. And their long-term unemployment is three times higher than the United States.
Our economy has created 7.9 million net new jobs since August 2003. That's more jobs than Eurozone countries and Japan combined have created.
America's workers are among the most productive of any major industrialized economy. And productivity growth in recent years is translating into higher wages and a higher standard of living. By most any measure, people today have more money in their pockets. Real per capita disposable income since January 2001 has risen 10.4 percent. And earnings for workers grew 3.7 percent over the 12 months ending in March. This translates into an extra $2,179 for a typical family of four with two wage earners.
But challenges loom. Our economy is evolving into a knowledge based-economy. Reflecting this transformation, two-thirds of all the new jobs being created require post-secondary education. These jobs require more creativity and critical thinking. And workers with more knowledge, skills, and creativity are in much greater demand. And, so their wages are rising much more quickly than those of less skilled workers.
Over the next decade, our country will need 3.4 million healthcare professionals, including physicians, therapists, and over 1.2 million registered nurses. We also need workers in other high growth industries including nanotechnology, geospatial technology, and the life sciences.
You know this better than most, since the American Hospital Association reported in 2006 that there were 118,000 RN vacancies alone. Not enough young people are entering nursing. But lack of capacity at nursing schools is also an issue. It has been reported that 150,000 qualified applicants for nursing school in 2005 were turned away because of a lack of training capacity. That number was up 18 percent over the previous year. As a result, the average age of Registered Nurses climbed to 46.8 years in 2004, up from 45.2 years in 2000.
The Labor Department understands very well the need for skilled workers in our economy. It administers about $9.5 billion of your tax dollars each year to help fund training programs. And the private sector spends much, much more. Everyone recognizes that training is a must if our nation's workforce is to remain competitive in the growing, worldwide economy.
Since 2004, the Department has helped increase health care-oriented training through a variety of initiatives. They include President Bush's High Growth Job Training Initiative, which promotes training for high growth sectors including health care.
And the President's Community-Based Job Training program helps community colleges increase their capacity to train workers for the high growth jobs of the future, including the ones that your industry provides.
Because employers cite a skilled workforce as a major concern, education and training are emphasized in the Department's Workforce Innovation in Regional Economic Development (WIRED) initiative. This program encourages regional economies to come together to collaborate in creating a common vision and strategy to foster regional job growth through the development of human talent. The Department has selected 26 regions to participate so far, and is currently vetting proposals for a third round of grants.
All told, the Department has provided more than $161.8 million since 2004 to boost training for the healthcare professions. Participants in these grants include state governments, municipalities, colleges, entrepreneurs, community organizations and healthcare providers. Many of these institutions have added seed capital and other resources including $182.6 million in cash and in-kind contribution to these grants. So it is a real partnership.
Some of these grants help lower-wage hospital workers upgrade their skills. Some encourage young people from underserved communities to enter the healthcare field. Others expand the capacity of community colleges and other institutions to train more qualified nurses and technicians. And this program is also helping rural areas address the shortage of healthcare workers.
The Department is doing all it can to help workers develop their skills and talents so they can met the needs of the 21st Century economy and compete.
As we talk about what's good for our workforce, let me also mention an important bill that's pending before the U.S. Senate that will take away work rights. It is called by its proponents the "Employee Free Choice Act," but is otherwise known as "card check." The House passed H.R. 800 on March 12, 2007, and as mentioned, it is now pending in the U.S. Senate.
Although this title sounds empowering, the Employee Free Choice Act does just the opposite. It takes away a worker's right and freedom to vote in a private ballot election.
Under current law, the most frequent form of union organizing is a private ballot election certified by the National Labor Relations Board. It is a federal independent regulatory agency.
This official process was initiated 60 years ago in response to the intimidation and harassment of workers.
The formality of this process ensures election integrity — that each person's vote counts. It allows each worker to choose what's right for him or her without that choice having to be made public.
Under this legislation, a union would automatically be certified if union organizers are able to gather the signatures of a simple majority of workers on cards.
Signatures on the cards could be solicited anywhere — at the workplace, at a worker's home — all in plain sight of other people. Workers would not have the right to a private ballot election.
Now interestingly enough, decertification of a union can only take place by a private ballot election.
There are other provisions in the bill that are equally troubling. One of them is mandatory binding arbitration. Under this mandatory binding arbitration provision, if a labor contract is not agreed to within a government dictated, 120-day deadline, the federal government could force a two-year labor contract on workers and employers. Workers would then be deprived of the ability to ratify, or not ratify, the contract.
They also cannot decertify the union, even if they want to, for the 2-year duration of that contract.
The other troubling part of this bill is that it would levy extensive penalties on employers, but not unions.
We believe that the right of a worker to a private ballot election is an intrinsic right in our democracy that should not be legislated away at the behest of special interest groups.
The Administration has taken the unusual step of issuing an early veto threat to signal serious concern with this bill. Should the Congress pass the Employee Free Choice Act, the bill will be vetoed to protect the right of workers to a private ballot election.
The Administration's position on Card Check is consistent with its philosophy that the best way to help workers is to empower them. That's the concept behind the President's ownership society, which proposes to give workers more control over their skills, training, education, pensions and health care, so they can face the future with confidence.
So thank you for everything you are doing to meet a critical need in our society, delivering quality health care to so many and creating jobs. Our health care system is the envy of many in the world. And working together, we can continue to ensure that there is a pipeline of skilled talent to answer the call to service in the healing arts.
Thank you!
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