Legislative committee to study at Alabama’s low workforce participation rate

A commission formed to study Alabama’s relatively low workforce participation rate met for the first time Thursday, with much of the discussion focused on keeping young people in the state.

But to Rep. Reed Ingram, R-Pike Road, the chair of the committee, there are plenty of other factors to consider. 

“It may be the work environment, it maybe something (to do with) safety, it may be childcare, it could be early retirement and not getting back into it,” he said. “It could be mental health, it could be addiction, it could be receiving more benefits than what we’re used to seeing in the past and maybe that’s what something that COVID gave to us. It could be, you know, harassment. It could be discrimination. It could be safety, it could be crime, it could be lack of skills, it could be housing.”

Despite record low unemployment rates in the state, Alabama has some of the lowest workforce participation numbers in the nation. Alabama’s labor force participation rate in August was 57%, significantly below the national rate of 62.6% last month.

Alabama’s “prime-age participation rate” – measuring labor force participation for those aged 25 to 54 – was 77.8%. But the national rate was 83.1%, according to the St. Louis Federal Reserve website.

Experts told the Reflector in August that the rate could reflect an older population or potentially discouraged workers.

Ingram said after the meeting that the commission wants to look into everything.

“It is a huge issue that we’ve got to tackle as soon as we can,” he said.

Members of the committee, attending in person and over Zoom, shared observations about the issue. 

“I was going to brag that we were well ahead of Tennessee, but I don’t and Mississippi but, you know, we’re not,” said House Minority Leader Rep. Anthony Daniels, D-Huntsville.

Several members talked about access to child care. 

Rep. Danny Garrett, R-Trussville, the chair of the House Ways and Means Education committee, said that he and Sen. Arthur Orr, R-Decatur and chair of the Senate Finance and Taxation Education committee, had discussed ways to provide child care funding in the past. He said that, last session, the pair did not like the credit model because it would have been a perk for people who already have child care.

“What we want to do is a child care credit that addresses the needs of those people who are at home because they can’t have childcare, so how do we benefit them?” Garrett said. Orr confirmed the conversation Thursday afternoon.

Daniels, a business owner,  said the ability to offer flexible hours “helped me retain employees.”

Daniels also said that flexibility in hours is more difficult for places like medical businesses, as you would need a full-time person to cover those hours.

“But at the end of the day, it’s all about the bottom line to me and being able to make certain the business can sustain this type of flexibility long term is very difficult,” he said.

Lawmakers also discussed the need to keep young people in the state, especially after college. Ingram said that they were providing funds for students to learn and train in-state, and they would end up going to places like Nashville, with more attractions.

“We spend that money on our budget to invest in them, and then they leave,” he said.

A legislature-funded initiative, Retain Alabama, had looked into why young people, specifically those with bachelor’s degrees, were leaving the state. Jim Purcell, executive director of the Alabama Commission on Higher Education, said in 2022 that places like Birmingham or Huntsville, could serve as “Emerald Cities” to retain graduates.

The initiative also showed that many of Alabama’s social policies, or at least graduates’ beliefs about Alabama’s social climate, spurred many to leave.

“We’re not going to leave any stone unturned but our young kids or our young graduates are our future of the state,” Ingram said to reporters afterwards.