Top 5 Issues for 2015 Expanded: Workforce Development

Most states are seeing evidence of economic growth with an increase in job creation and overall decrease in unemployment.  However, too many individuals remain unemployed, the skills gap dividing workers’ technical skills and those capabilities needed by business and industry continues to grow, and the lack of opportunities to advance exists for numerous employees.  Training workers with the skills and competencies needed to sustain employment will help provide for their family and will assist American businesses grow the economy.   In 2015 state policymakers and executive branch officials will focus on job-driven training, reducing the skills gap, aligning systems and targeting the hard-to-employ.  

Experts agree the United States will not have enough adequately trained workers for the jobs of the future without action at the federal, state and local levels to increase entry into postsecondary education, provide community-based training of adults and increase implementation of job-driven training strategies. A recent prediction noted a loss of $1.7 trillion by 2030 if improvements are not made in postsecondary education to bridge the skills gap.  Young people and adults must obtain the skills needed to ensure they can become successful citizens which ultimately will lead to increased state prosperity. 

Less than 40 years ago, nearly 75 percent of the jobs in the United States could be filled by workers with no more than a high school diploma. Manufacturing, farming, and construction jobs, among many others, typically required no formal education beyond 12th grade. However, as technology has advanced and critical problem-solving skills have become inextricably linked with most occupations, so too has the level of education required for most jobs that were once classified as ‘unskilled.’

In a recent survey by the Manufacturing Institute, 67 percent of respondents reported a moderate to severe shortage of available, qualified workers, and 56 percent anticipate the shortage to grow in the next three to five years.  Additionally, the survey showed that on any given day, 600,000 manufacturing jobs are unfilled due to a lack of qualified candidates. In fact, a recent McKinsey survey of more than 2,800 employers worldwide shows four out of 10 employers say they cannot fill entry-level positions.  More than one-third of respondents stated that their businesses are suffering economically because of a lack of appropriate skills in the labor market. 

These results underscore the worsening talent shortage that threatens the future effectiveness of the U.S. manufacturing sector.  A 2012 survey by Deloitte Development notes that the American public views the U.S. manufacturing sector as fragile and unstable and note their lack of confidence in policymakers’ ability to fix the situation and build a competitive economy.

A report from the Georgetown University Center on Education and the Workforce noted the old middle-wage jobs that paved an entire generation’s way to the middle class - jobs like manufacturing, transportation, construction and mining - are largely gone. But middle jobs remain almost one third of the job openings across the United States.  The report also notes that, by 2022, the United States will lack 11 million workers with postsecondary degrees, certificates or credentials necessary to meet the job demand. That number includes 6.8 million employees with a bachelor’s degree, and 4.3 million workers with an associate degree, vocational certificate or some college experience. 

President Barack Obama in July signed into law the Workforce Innovation and Opportunity Act (WIOA), which is designed to help individuals seeking employment access the education, training and support services needed to be successful in the labor market. Additionally, the Act will help match business and industry with the skilled workers needed to compete in the global economy.  WIOA may help spur states in the direction of looking at education, labor and workforce development in one broad stroke, such as with successful regional partnerships in place today. States will be required to develop and submit a four-year unified strategy that identifies skills gaps with employers and how the state is going to close those gaps. The new Act is a significant chance for states to improve how they educate and train their workforce. 

In the 2014 report “Ready to Work:  Job-Driven Training and American Opportunity,” utilizing the various roles in regional partnerships can provide a network of employment, training and related services that assist individuals to overcome barriers to becoming and staying employed and serve many vulnerable populations that should be incorporated into job-driven training programs.   The authors note that, using an expansive definition, federal employment and training programs are funded at just over $17 billion in the FY 2014 federal budget. By way of comparison, in 2013, U.S. employers are estimated to have spent more than $450 billion on training, overwhelmingly for their own employees.  This amounts to 25 times more than the federal government spends on job training. 

Job-Driven Training
Job training and education programs play a critical role in closing the gap between the skills businesses need in today’s workforce and the skills current job seekers bring to the table. Not only do job seekers build on existing competencies through job-driven training programs, but they also learn new skills and bring home a paycheck. Policymakers are looking at ways to ensure all stakeholders include best practice elements of job-driven training, including working with employers to determine hiring needs, offering on-the-job training, internships and apprenticeships, utilizing data to drive accountability, promoting seamless transitions between educational entities and creating regional partnerships among American Job Centers, education institutions, labor and nonprofit organizations. 

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Reduce the Skills Gap with Career Pathways
One strategy to reduce the gap between the skills employers want and the skills potential employees have is to implement a system of career pathways to support and enhance workers’ transitions from an educational institution into the workforce.  These pathways include cross-agency partnerships built around alignment of K-12 and postsecondary education, workforce development programs, employers and community services. Components include education curricula and instructional strategies that provide real world application, awarding academic credit for knowledge and past experiences, offering multiple entry and exit points so workers can advance in a particular field, and offering industry-recognized credentials and high quality certificates. Policymakers also will be exploring ways to engage business and education to determine skill requirements for jobs, the potential for stackable credentials so job seekers can obtain a degree in line with labor demands, and ways to provide community-based counseling and support services so workers create individual career plans and have support to pursue them.

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Alignment of K-12, Postsecondary Education and Workforce Development Systems
To create a well-educated, skilled workforce, all stakeholder groups must work collaboratively. The first step to developing an aligned system is to have all constituents unite to create shared goals and outcomes followed by an analysis of existing policies, programs and resources. Some policies and programs may need revision to ensure they are working toward the same purpose. Because data and information are critical to the implementation of education and training programs, states can examine their longitudinal data systems to ensure they track students from entry into education through postsecondary education and into the workforce. Policymakers also may want to encourage business leaders to become more involved in education outcomes for all students to ensure college- and-career-readiness. 

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Community Services for Hard-to-Employ
Adults facing a broad range of potential barriers to employment have been identified as “hard-to-employ” and need community support to help them overcome obstacles to sustainable employment. Many face challenges such as a criminal background, lack of a high school diploma, illiteracy, poor technology skills, poor English or mental and physical health conditions.  For many, the cost to enter postsecondary education is prohibitive or they may have family responsibilities that stop them from obtaining training and a credential. Policymakers can work to develop community-based services so these people can successfully complete training, get hired and stay in jobs. States need to develop specialized screenings, assessments and interventions to identify the hard-to-employ and assist in the transition to work.  Communities can then work to provide alcohol, drug and mental health treatment, services for the disabled, adult education programs and a network of wraparound services to meet needs.

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Employment of Veterans
Some veterans experience difficulties with the transition to civilian life. Veterans and separating service members may need support to learn about employment resources and expertise or to protect their employment rights. Policies such as awarding credit for training and experience, career exploration and job skills for unemployed veterans and training veterans to fill high-demand jobs will be priorities for some states in 2015.  Business leaders should be involved to assist with on-the-job training, apprenticeships and work-study programs to build on veterans’ unique skills sets. Higher education also needs to develop an institutional understanding of the mental, physical and behavioral health needs of veterans, as well as to address barriers to success as veterans return to obtain credentials, certificates or a degree leading to employment.

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