On May 11, 2021, Congresswoman Kelly, Senator Durbin, and Senator Duckworth introduced two bills to Congress that would increase and expand employment opportunities for youth. The HERO Act (Helping to Encourage Real Opportunity) and the Creating Pathways for Youth Employment Act would increase federal resources for communities seeking to create or grow employment programs and provide tax incentives to businesses and employers to hire and retain youth from economically distressed areas.
These bills address the 10.3 million 16-24 year olds that were both out of work and school as a result of COVID-19. The premise of the bill is that employment barriers at a young age can have devastating long term effects, such as: disconnected youth, lower lifetime earnings and higher rates of incarceration and opioid addiction.
If passed, the HERO Act would:
- Encourage employers to hire underserved youth who reside in communities with high rates of poverty
- Provide a tax credit of up to $2,400 for employers that hire and train youth ages 16-24 who are out of school and out of work
- Provide a tax credit of up to $2,400 for employers that hire and train youth ages 16-21 that are currently in foster care or have aged out of the system
- Expand the summer youth program under the Work Opportunity Tax Credit (WOTC) by doubling the amount of the credit to $2,400 and expanding the program to include year-round employment.
If passed, the Creating Pathways for Youth Employment Act would:
- Make it easier for local governments and community organizations to apply directly for federal funding to create and expand summer and year-round employment programs for young people.
- Establish a five-year, $1.5 billion competitive grant program for youth summer employment and a five-year, $2 billion competitive grant program for youth year-round employment that will provide financial support for communities seeking to create, improve, or grow summer and year-round employment opportunities for youth ages 14-24.
- Reserve fifty percent of funds for programs serving in-school youth, and fifty percent would be reserved for programs serving out-of-school youth.
Both grant programs would provide planning grants of up to $200,000 for 12 months or implementation grants of up to $5 million over 3 years.
We will follow these bills closely and keep you informed of any new or additional credits that can be earned as this moves through Congress.