The modern era of “workforce development” can trace its roots back to the Manpower Development and Training Act (MDTA) of the 1960s and the Comprehensive Employment and Training Act (CETA) of the 1970s. Notable legislative milestones that followed included the Job Training Partnership Act (JTPA) of the 1980s that established a stronger role for employers via “private industry councils”, and then the Workforce Investment Act in the 1990s that emphasized service/funding coordination via “one stop centers.” It seems apparent that we are desperately in need of another transition as the Workforce Investment Act (WIA), passed in 1998 as a 5-year law continues to operate on year-to-year extensions combined with funding reductions. This session will discuss the needs and demands of the current workforce system and future policy course.

1. Convergence of Workforce
Development, Economic
Development & Education
1
ROY VANDERFORD
CENTER OF WORKFORCE INNOVATIONS
RVANDERFORD@INNOVATIVEWORKFORCE.COM

2. The World Wants a Good Job
2
 Gallup organization has studied human nature &
behavior for over 70 years
 Jim Clifton, CEO of Gallup, author of The Coming
Jobs War, cites the “10 demands” that America must
master to win the jobs war
 Conclusions based on literally trillions of
combinations of data & opinions worldwide
 Job creation is the new currency of all world leaders
 The will of the world is first and foremost to
have a good job

3. Gallup‟s 10 Demands
3
1. The biggest problem facing the world is an
inadequate supply of good jobs.
2. Jobs creation can only be accomplished in cities.
3. There are 3 key energy sources of job creation in
America: our top 100 cities, our top 100
universities, & our 10,000 local “tribal leaders.”
4. Entrepreneurship is more important than
innovation.
5. America cannot outrun its healthcare costs.

4. Gallup‟s 10 Demands (cont.)
4
6. We must fix the dropout rate – 1/3 of public school
students drop out – ½ of minorities.
7. We must double our number of engaged employees
– only 28% of U.S. workforce meets standard.
8. Jobs occur where customers appear – we must
understand global customers better than anyone
else.
9. Every economy rides on the backs of small &
medium-sized businesses.
10. So go exports, so goes the coming jobs war.

5. Do We Need More Jobs or More Skills?
5
 Nature of the “skills gap” is hot topic at the
moment
 Peter Cappelli, Wharton School, & author of Why
Good People Can’t Get Jobs, says “If you can‟t get the
right person for the job, chances are you‟re a bad
manager and maybe a little cheap”
 Martin Scaglione, President of ACT Workforce
Development Division, states “there is not enough
talent coming through the system to meet the
demand for jobs at the middle-skill level, and there is
an over-abundance of low-skilled workers”

6. Workforce Development & Education Convergence
of Interests
6
 Skills certification – the common language for
communicating with each other, and with employers
 Remediation – contextualized with occupational skills
 Transferability & stack-ability of credits – industry
certifications, dual credit, prior learning assessments
 STEM – core “polytech” base for employers, with
additional education & training provided by employer
 Self-employment & entrepreneurship – not
enough jobs for laid-off workers
 12th to 13th year transitions – assumption that all
students need post-secondary education in some form

7. Attention-Getting Statistics
7
 70+% of all high school grads pursue some form of
additional education within 2 years of graduation –
most fail to obtain credentials
 83% of companies report moderate to serious
shortages of skilled workers – 69% expect shortage
to grow in next 3-5 years
 86% of Americans view the “trades” as essential for
our prosperity –but only 1 in 3 parents would
encourage child to pursue a trade
 19.5% unemployment rate for bachelors degree in
clinical psychology – 16% for high school dropout

8. A Few Thoughts on Solutions
8
 Focus on hard-wiring the high school grad to a 13th
year of education & call it college
 If an applicant for a 4-year school doesn‟t meet
entry standards, don’t let them in (yet)
 Sell students on social status of technical &
“middle skill” jobs – not just the economics
 Differentiate ROI for types of degrees – not just
advise to get a college degree

9. More Thoughts
9
 Student spending own money can purchase
anything (even Russian Literature) – if spending
public money, career plan should be required
 Employers need to be more specific about skills
they need – many require college degrees for jobs
that don’t require them
 Don‟t approve large student/parent loans for those
who don‟t have the ability to pay off the loan – we
are moving down same path as housing market

10. Thank You
10
Questions/Answers

11. Long-Term Unemployment and
Workforce Development
Findings from a Federal Reserve Initiative
11
Kim Zeuli
Federal Reserve Bank of Richmond
October 23, 2012

12. Disclaimer
12
The views expressed in this presentation
are the views of the speaker and do not
necessarily reflect the views of the Federal
Reserve Bank of Richmond or the Federal
Reserve System.

13. Initiative Goals
13
 Gather information that complements or enhances
employment data.
 Develop a deeper understanding of factors that
create long-term unemployment.
 Identify promising workforce development solutions.

14. Initiative Overview
14
 Information collected through forums held
throughout the country.
 Small focus groups and listening sessions.
 Larger sessions with formal agendas focusing on a particular
demographic or employment sector.
 Participants included local employers and
organizations providing workforce development
services.

16. Employment Outlook:
A Disaggregated View
16

17. Source: Bureau of Labor Statistics 17

18. 18
This recession is Unemployment Rate in the
different. United States
We have not
experienced a
significant drop in
unemployment
during recovery as
we have had in
previous recessions.

19. 19
Not all age groups Unemployment Rate by Age Groups
have felt the recession
equally. 30.00
Younger groups have
noticeably higher 25.00
unemployment rate
unemployment rates
than older groups. 20.00
16-19 yrs
One in every four 20-24 yrs
young adults has been 15.00
25-34 yrs
unemployed in recent
years. 10.00 35-44 yrs
45-54 yrs
5.00 55 and over
0.00
Source: Bureau of Labor Statistics

20. 20
We heard a lot about Unemployment Rate by Gender
men vs. women (so-
called „man-cession‟).
12.0
Jobs in fields where
men are 10.0
disproportionately
represented have been
8.0
hit harder.
The gap has started to 6.0
converge as the urate-m
unemployment rate 4.0 urate-w
has started to decline
in recent months.
2.0
0.0
2005
2004
2008
2007
2006
2009
2011
2003
2001
2002
2010
Source: Bureau of Labor Statistics

21. 21
Recovery by
Gender
Women, who fared
better than men in the
recession, have not
done as well in the
recovery.

22. 22
Unemployment Rate by Race
The unemployment rate 18.00
has almost doubled for
every race since the 16.00
beginning of the recession.
Unemployment rate
14.00
For all races other than
black, the unemployment
12.00
rate has begun to decline. 10.00 white
8.00 black
6.00 asian
hispanic
4.00
2.00
0.00
2001
2011
2002
2005
2008
2010
2007
2003
2004
2006
2009
Source: Bureau of Labor Statistics

23. 23
Recovery by
Race and
Ethnicity
Steady but uneven
gains in employment
for all groups of
workers.
Hispanics and Asians
are experiencing a
faster rate of growth in
jobs than other groups.

24. 24
Unemployment Rate by Educational
The unemployment rate
for those with a Attainment
bachelor‟s degree or
greater currently stands 16
unemployment rate
around 4%. 14
12
Unemployment rate for
10
those who have not
completed high school is 8
over 14%. 6
4
The unemployment rate
2
for each level of
educational attainment 0
has stabilized or started
to go down recently.
less than highschool diploma
high school graduate, no college
less than bachelor's degree
college graduates
Source: Bureau of Labor Statistics

25. Labor Force Participation
Survey and Interviews:
Summary of Results
25

26. 26
Labor Force Participation Survey
and Interviews
Overview
 What did we do?
 Interviews (10) and survey (143 respondents) of
To better understand employment/training and social service providers in all
formal and informal states of the 6th District.
labor force
participation of low-  What were we looking for?
education/ low-wage  Employment barriers for individuals with a high school
individuals in the diploma or less who would typically fill low wage jobs.
Southeast.  Approximately one-third of the U.S. workforce has a high
school diploma or less.
 Low-education occupations largely fall into the following
categories: Construction and Extraction;
Installation, Maintenance, and Repair; Food Services;
Production; Transportation and Material Moving.
 Low wage job = $39,821 or less annual household income
for a family of four (about $3,300 per month).

27. 27
No jobs available in the area where 64%
Main barriers to the applicants live or where
6%
28%
applicants can access with…
finding Existing job vacancies require 77%
employment experience, skills, and/or
certification that individuals do… 2%
21%
Individuals do not have the social
• Skills mismatch/lack skills, appearance, and/or attitude 35%
55%
of skills. required by employers. 8%
• No jobs available. Submitting job applications require 36%
technological skills or access to 52%
• Lack of soft skills. technology that individuals do not… 12%
33%
Individuals can‟t pass a drug test. 44%
Drug tests and 14%
background checks Individuals can‟t pass a background 39%
check (such as driving record or 46%
were considered credit check). 10%
relatively minor
Wages for potential jobs are not as 24%
barriers. good as unemployment benefits.
38%
33%
Significant
Unemployment compensation is 19% Barrier
providing sufficient support to 34%
continue looking for more… 35% Minor
Some aspect of the available jobs is Barrier
23%
undesirable, such as 34% Insignificant
shifts, weekends, overtime, travel,… 29%
Barrier

28. 28
Potential earnings cannot 57%
Main reasons cover costs of child care or 31%
for dropping out elder care. 8%
of job search
Receive unemployment 32%
Potential earnings not compensation that is
• 35%
sufficient to cover their
able to pay for child financial needs. 22%
and elderly care.
• Discouragement. Looking for a long time but 51%
could not find the right job 28%
and gave up. 13% Very
Returning to school important
and seeking training reason
were not as important 17% Somewhat
Currently pursuing college or
35% important
to this group. technical school degree.
41% reason
Not an
17% important
Currently pursuing training
40% reason
or certification.
35%
0% 20% 40% 60%

29. 29
“Mainstreaming” earnings are too 11%
low and there is no incentive to file 31%
Turning to the or report income. 33%
informal sector Individuals have worked in the
underground economy for a long
4%
40%
time (culture, language, networks). 35%
52% agree that the
underground economy 32%
increased during the recession Reporting income is too 30%
complicated or difficult to do.
and recovery. 14%
Main reasons: Individuals prefer to receive cash 6%
31%
payments (no bank accounts). 44%
o Fewer barriers to entry
(no job
10%
application, interview, e Fewer barriers to entry (no job 23%
tc.). application, interview, etc.). 48%
o Preference for cash
payments. Retired from “mainstream” 28%
o Individuals have worked workforce, but seeking more 32%
in this sector for a long flexible employment. 11%
time 3%
(culture, language, netw Other. Please explain. 8%
ork). 35%
Not an important reason Somewhat important reason Very important reason

30. Round Tables:
What We Heard
30

31. Labor Force Supply Chain Issues:
Fragmentation of Workforce System
31
 Lack of coordination between array of workforce
training programs and funding.
 Providers of government-funded employment and training
services are hampered by the fact that there are more than 40
separate federal programs with separate funding streams and
eligibility criteria (New Jersey).
 Lack of alignment between K-12 education, technical
and community colleges, workforce
agencies, employers, and social services networks.
 “Systems disconnect” between educational and workforce
programs (Baltimore, MD).

32. Labor Force Supply Chain Issues:
Disconnect Between Education and Labor Market
32
 Grade school curriculums typically focus on higher
education and not job skills.
 While employers must take responsibility for communicating their
labor needs, educators must be responsible for designing systems
nimble enough to respond to workforce demands (San Antonio, TX).
 Communities have seen cutbacks in vocational training
and a push toward making all students “college ready.”
 People perceive a lack of respect in the community for jobs such as
plumbers and electricians. As a result, many secondary schools have
subordinated vocational training to college preparatory tracks
(Dyersburg, TN).

33. Employment Barriers: Job Skills
33
 Applicants lack hard skills required to fill vacant
positions in growing sectors.
 Shortage of local candidates with critical thinking and problem-
solving skills to fill the jobs in the digital media sector (New
Orleans, LA).
 Applicants lack the hard skills required to fill healthcare
positions, particularly the computer knowledge to work with health
care systems (Elkins, WV).
 The healthcare sector will likely be demanding the greatest numbers
of workers over the next ten years but clearly there is no sufficient
supply of trained workers to fulfill these jobs (Birmingham, AL).
 Applicants also often lack soft skills such as professional
conduct.

34. Employment Barriers: Transportation
34
 Logistics are a major hurdle for the chronically
unemployed, the urban poor, and individuals with disabilities.
 Public transportation schedules heavily targeted to rush hours do not
work for swing or night shifts workers, or workers who may have early
report times (Baltimore MD).
 Transportation is also a significant obstacle to employment
for residents of rural communities and small towns.
 Long travel times lead to significant expenditures on support networks
such as babysitters (Elkins, WV).
 Delays lead people to miss work or spend more time than can
be justified to commute to their jobs.

35. Employment Barriers: Employer Risks
35
 Long-term unemployment in itself decreases an
individual‟s likelihood of landing a job.
 Employers perceive risks in hiring those who have been
unemployed for a long time and are therefore less willing to
hire them (Kansas City, MO).
 Participants differentiated between individuals who
had lost a job due to layoffs during the recession and
those hard to employ because of life situations (e.g.
criminal history).
 People with criminal backgrounds face hiring practices that
are inconsistent across industries (Baltimore, MD).

36. Employment Barriers: Disincentives
36
 The unemployed face trade-offs between public
assistance and low wage jobs.
 “Cliff effect” – an increase in wages leads to a sharp reduction
in income-tested public benefits, especially childcare subsidies
(Omaha, NE).
 Public assistance create disincentives for people to fill entry-
level positions. Employees even request a part-time schedule
or reduced hours in order to retain government benefits
(Elkins, WV).

37. Sector-Specific Issues: Manufacturing
37
 “Broken supply chain”
 Community‟s workforce development pipeline is not equipped to meet
demand for specific skilled labor, such as welders and technicians
(Mobile, AL).
 Cities that experienced significant and widespread
manufacturing layoffs continue to suffer from high rates of
persistent unemployment.
 Workers have had difficulty adjusting and retooling after the decline of
their traditional industry – textiles (Eden, NC).
 Community and technical colleges cannot always keep up with
labor demand.
 Difficult to get retrained after a layoff as many educators have trouble
accommodating student demand (Eden, NC).

38. Sector-Specific Issues: Healthcare
38
 Major growth industry; experienced robust growth throughout the last three
recessions.
 Yet, positions are going unfilled.
 Workers lack requisite hard and soft skills. For example, employers have trouble with employees
disobeying company policies and protocols that are essential in a healthcare environment
(Elkins, WV).
 Training is inadequate or inappropriate.
 Despite a high demand for nurses, there is a lack of available nursing educators to meet the need
(Memphis, TN).
 Credentials are not standardized, leading to difficulties placing workers with the “wrong” skills.
There is a steady stream of individuals being certified as Licensed Practical Nurses (LPNs);
however, the local healthcare sector places a higher value on trained nursing certifications other
than the LPN (Baltimore, MD).
 Rural healthcare facilities have a particularly difficult challenge in filling vacancies.
 Rural communities compete with each other on a regular basis for nurses and technicians
(Elkins, WV).

39. Thank You!