Federal tax credits, training programs help vets find careers

Federal tax credits, training programs help vets find careers
BUSINESS JOURNAL | Karen Ducey ON THE JOB: Dustin Eberle, an Iraq war veteran, works as an apprentice technician for VECA Electric & Technologies in Seattle. He credits a program called Veterans In Construction Electrical (VICE) with helping him find work. “Let’s face it, I’ve never made a resume,” he said.
After leaving the U.S. Air Force in 2005, Ed Gorman struggled for six years to find and keep a job.

"Everything was low-paid, dead end," the veteran said. "I was 26, with two kids, trying to compete with 18-year-olds for basically a step up from McDonald's."

Unable to hold onto a steady job, Gorman, now 31, joined the many thousands of unemployed veterans in Washington state, a group that could easily grow as soldiers return from the Middle East.

As a major hub for military bases, Washington is especially vulnerable to the economic burden of having a large influx of young veterans seeking public assistance instead of earning a wage. Veterans make up 8.5 percent of the state's work force but recently accounted for nearly 12 percent of unemployment claims.

With veterans from Joint Base Lewis-McChord, several Navy bases and smaller outposts throughout the state returning from the war in Afghanistan, thousands will be looking for job opportunities at a time when the economy is still rebounding. Though the state's unemployment rate has been falling in recent months, this influx of new job seekers could put a strain on a fragile economic recovery. That, along with an ongoing debate about whether the country has done right by its military personnel, has led politicians and business leaders to seek ways to help find work for those returning from war.

Now, as Americans get ready to celebrate the 12th Independence Day since the country invaded Afghanistan, Gorman and many other veterans are benefiting from a nearly two-year-old federal law that gives employers bigger tax credits when they hire veterans. Lawmakers view the "VOW to Hire Heroes Act" as a precursor to more legislation to help vets.

U.S. Sen. Patty Murray (D-WA) drafted the bill, designed to help returning military personnel transition to the civilian world.

"They get out of the military and they've come from a very structured environment where they're told what to wear, what to do and when to show up," said Chip Kormas, the veterans program manager for the state Employment Security Department. "They now come into the civilian world, and they don't know how to connect with a business. It's difficult to stand in front of a recruiter who doesn't understand that."

The veterans who struggle the most are typically those in their 20s or early 30s who joined the military right out of high school. They're competing with peers who went to college instead of fighting a war, and their skills don't always translate well in the civilian world.

"The reality is (employers) treat you no different from somebody who basically couldn't get out of high school," said Gorman, who worked as an inventory clerk, a telemarketer and a security guard, among other odd jobs. "It was not the warm welcome I was expecting."

His search came to an end in September when Continuant Inc., a Fife-based telecom company, hired him based on the strength of his military career:
"They looked at my history: what I did, what my potential can be, my character."

Continuant is one of many Washington employers taking steps to recruit and train veterans - and, in the process, taking advantage of a newly expanded federal tax credit.

The tax credit, which rewards employers who hire veterans, bases benefits on several criteria, including a veteran's circumstances. The credit was expanded at the end of 2011 to cover veterans who have been unemployed for more than six months - significantly increasing the volume of candidates who qualify and who can make a business eligible for tax credits.

The value of the credit also was doubled. Now, depending on the veteran's circumstances, employers get a tax credit of $2,400 to $9,600 for every veteran they hire. The credit works like the child-care tax credit works for parents: Companies get the full and immediate savings on their tax bills.
"It's good icing on the cake" for business owners who already want to hire from the legions of veterans who are part of this region's significant military presence, said Bill Tarrow, communications director at the state Employment Security Department.

Veterans make up 8.5 percent of the state's work force, according to 2011 Census data, the most recent available. That's about 283,000 working vets out of the state's total work force of 3.3 million.

The changes in the federal tax credit program have pumped about $30,000 back into Continuant. In exchange for that money, the government gets a private sector commitment to train Continuant's employees for a specific, applicable trade.

"I would hire veterans anyway, even if it wasn't profitable," said Continuant CEO Doug Graham. "But the fact of the matter is, it is profitable."

The company hired nine veterans in 2012, which is consistent with its hiring trends for the past seven years. Of its 243 employees, 40 are veterans.
It's still unclear how much of an impact the changes in the federal tax credit have had in Washington, because 2012 data won't be available until August. But anecdotally, officials are seeing results, Tarrow said.

In a separate state effort, Washington in 2011 made it legal to give hiring preference to veterans - and to advertise that preference.

"We want to see veterans above all else," said Eric Hahn, vice president at Tacoma-based manufacturer General Plastics. "Veterans are proven (workers) … They have strong basic skills, they are dependable ... they tend to be very dedicated."

Employers like Hahn have a number of resources they can use to find and hire veterans.

Helmets to Hardhats is a nonprofit that works with industry unions and associations to get veterans into construction. It runs a program called Veterans In Construction Electrical (VICE), which trains veterans and helps connect them with potential employers.

The 14-week VICE program set Dustin Eberle on the path to becoming an electrician. It also helped him with the process of applying for jobs - something he found particularly useful.

"Let's face it, I've never made a resume," the 30-year-old said.

He credits the VICE program with helping him land a job earning $32 an hour as an apprentice electrician at Seattle-based VECA Electric & Technologies, an electrical contracting company.

"It's not just a job, it's a career," Eberle said. "It's a future; it's retirement and benefits for your family."

Getting people like Eberle into careers is good for taxpayers and the economy, too.

In June, one week of records included about 102,000 unemployment insurance claims. Of that, 12,077 - nearly 12 percent - were for military veterans, and of those, 3,485 had recently separated from the military, according to the Employment Security Department.

"If they're trying to defend our country and give us the life that we have, then I think it's a good thing to give back to those people," said Brian Westerlund, president of VECA. "And they turn out to be pretty darn good workers. They're disciplined."

VECA was founded right after World War II by two veterans as the "Veterans Electrical Contractors Association," and maintains its identity as a place where veterans can find work. About 10 percent of the company's 550 employees are veterans, and VECA has received more than $50,000 in tax credits, Westerlund said.

Another program, Military to Manufacturing Career Pathways (M2M), was created by the Center for Advanced Manufacturing Puget Sound (CAMPS) to offer three-day training in manufacturing, along with factory tours.

"If we can get them before they get out, their chance of employment is higher," said Tom McGlaughlin, the executive director of CAMPS.

When veterans go through a series of low-income, low-seniority jobs, it starts to make their work history look "shaky," McGlaughlin said.

"They get a little disillusioned," he said. "They served their country; they should be able to find work. When they can't, they get frustrated."

Employers said they haven't seen many downsides to hiring veterans, although nationally post-traumatic stress disorder and other disabilities have been raised as potential challenges.

One issue locally is that some veterans remain in the Army reserves or National Guard and can be recalled for duty.

"We have a great employee who is a helicopter mechanic who just got called back to active duty," said Jon McQuiston, president of Auburn-based OmniFAB. "But he's been with us for a year. We're invested in him."

OmniFAB, a metal manufacturing company, got involved in the M2M program less than a year ago and already has hired four veterans. The company has 60 employees, and like many small manufacturers it faces tough competition for talent.

"The M2M program allows us to take people who are a little more mature," McQuiston said, "who know how to show up to work each morning, are able to take direction and are eager to learn a new trade or skill."

For policy makers, there's still work to be done.

Sen. Murray's staff cited two key pieces of legislation coming before Congress later this year. One would provide rehabilitation and job assistance to disabled vets who have used up their state unemployment benefits.

Another would require the head of every federal agency to make a plan for recruiting veterans.

"Getting our veterans into education programs, into good jobs, or starting small businesses doesn't benefit just the veteran - it helps us grow our economy and the middle class," Murray said in a statement. "Though important progress has been made, developing a seamless transition (for veterans) is a challenge that (agencies) continue to face."

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