Sector-based Workforce Intermediaries in the United States

1. Flexwork Research Conference • October 24-25, 2013Amsterdam Sector-based Workforce Intermediaries in the United States THE ASPEN INSTITUTE THE ANNIE E. CASEY FOUNDATION Maureen Conway Robert Giloth

2. U.S. Labor Market Intermediary Landscape This presentation focuses on these Workforce Intermediaries. • A new class of sector-based intermediaries has emerged that goes beyond job matching and outsourcing functions to focus on career advancement for low-skilled workers in the context of employer demand, skill gaps and improving job quality

3. Overall U.S. Labor Market Trends Source: Osterman, Paul (Forthcoming in 2014). The Labor Market Context for Employment and Training Policy. In M. Conway and R. Giloth, Workforce Intermediaries and Sector Strategies in an Uncertain Economy: A Decade of Research and Practice.

4. Job Opportunities Even Without a Four-Year Degree There are 29 million jobs that pay good wages and do not require a four-year degree. All Jobs (Jobs in millions) Source: Anthony Carnevale analysis in Career and Technical Education: Five Ways that Pay Along the Way to the B.A.

5. Problems with Labor Market Integration • Supply and demand in dynamic and flexible economies • Organizing similar groups of employers and workers • Generating and sharing market information • Navigating fragmented institutional and financing landscape • Multiple definitions of workforce problems, solutions and measures of success

6. What is Sector-based Workforce Development?* *Clark, Peggy and Steven Dawson. 1995. Sector Strategies for Low-Income Workers: Lessons from the Field. Washington, DC: The Aspen Institute, November. Creates, Over Time, Systemic Change with that Occupation’s Labor Market

7. What are Workforce Intermediaries? • Workforce Intermediaries are . . . the organizational dimension of sector, industry approaches • Workforce Intermediaries are . . . entrepreneurial partnerships of employers, training institutions, unions, community organizations – built upon many platforms • Workforce Intermediaries serve . . . groups of employers and workers for the purposes of filling skill gaps and promoting career advancement Question: How did U.S. go about growing Workforce Intermediaries and can it be sustained?

8. Traditional Workforce Development vs. Workforce Intermediaries • Traditional • Workforce Intermediaries • Focuses on increasing worker skills and job placement • Focuses on solving problems faced by workers and businesses • Transactional • Relational • Works within existing funding systems and business practices • Works to change funding systems and business practices to enable full array of solutions • Sharp boundaries around fixed organizational roles and practices • Flexible partnerships to solve problems and enhance value • Short-term focus • Long-term orientation

9. Characteristics of Workforce Intermediaries* • Entrepreneurial “dual customer” partnerships • Interpreters, bridges and buffers between employers and employees • Brokers, integrators, and learners for information, credentials, career pathways and financing • Solve problems and “make markets,” not just reactors • Adaptive learners/flexible investors * Giloth, Robert P (2004). Workforce Intermediaries for the Twenty-first Century.Philadelphia, Pennsylvania: Temple University Press.

10. Launched in 1992 Participants Served: 3,000+ Sponsored by 28 public, private and philanthropic investors. Sector Workforce Intermediaries Wisconsin Regional Training Partnership: Milwaukee (WRTP/BIG Step) Programs • Pre-employment training certificate programs • Academic tutoring for apprenticeship programs Results • Average starting wage per hour for participants in 2012 = $17.80 • Racial minorities accounted for 63% of placements, women accounted for 7% of placements • Randomize trail: $6,255 over 24 months

11. Sector Workforce Intermediaries Project QUEST: San Antonio Programs • Academic preparation training • College-based occupational training • Case management services Results • Average starting wage per hour for participants in 2012 = $19.65 • 11% of participants are African American; 73% are Hispanic; 80% are Women • Randomized trial study underway • Launched 1992 • Participants Served: 5,000+ • Sponsored by 29 public, private and philanthropic investors

12. Scaling Challenges for Workforce Intermediaries • Workforce Intermediaries evolved more as exceptions or workarounds than from concerted policy or from labor/management • A challenging dimension of workforce intermediaries are the costs of organizing, filling gaps, and career advancement • Organizing employers and partners is not a part of most U.S. public workforce policies • Scaling strategies must address these costs

13. Boston’s SkillWorks: 10 Year Snapshot (2003-2013) participants gained wages participants attained credentials participants earned promotions 1,300 80 employers engaged in 10 workforce intermediaries/ partnerships total funding partners participants 800 27 4,500 425

14. Pennsylvania Industry Partnership Program (2005-2011) 75+ workforce partnerships 6,300+ employers involved 100,000+ workers trained 11% higher wages starting out

15. National Fund for Workforce Solutions The National Fund for Workforce Solutions is a Philanthropic Workforce Development Initiative Focused on Expanding the Number of High-Quality Workforce Partnerships

16. The National Fund Model and Goals

17. National Fund for Workforce Solutions The Fund is Paying Off for Participants • 42,299 unemployed/underemployed received skill training • 28,614 degrees, certificates and credentials awarded • Two-thirds of 11,694 job seekers placed in jobs • Of those placed in jobs, one out of four earned more than $15/hour • 100 Workforce Intermediaries/ Partnerships: Now in 32 sites with 383 funders /nonprofits and 4,064 employers participating • Significant co-investment: Leveraged $41 million from national funders with $192 million in matching funds from local funders • Building evidence: Early data on efficacy of the model indicates people are getting hired, earning credentials and advancing

18. The Sector Employment Impact Study Random assignment occurred after intake and baseline information collected Both treatments and controls were interviewed at baseline and after 24 month follow-up period Began in 2003: Three skills training programs were selected to participate: • JVS – Boston • Per Scholas – New York • WRTP – Milwaukee 1285 were enrolled in the study Source: Maguire, Sheila, Joshua Freely, Carol Clymer, and Maureen Conway (2009). Job Training That Works; Findings from the Sectoral Employment Impact Study. Philadelphia, PA: P/PV.

19. Sector Employment Impact StudyEarnings Controlling for Employment Source: Maguire, Sheila, Joshua Freely, Carol Clymer, and Maureen Conway (2009). Job Training That Works; Findings from the Sectoral Employment Impact Study. Philadelphia, PA: P/PV.

20. How Does Sectoral Employment Development… …Improve, Retain and Expand A Qualified Workforce? Employer Workbook Turnover, retention, yield, diversity …Improve The Quality Of The Company’s Product Or Service? Employee satisfaction; Scrap, rework and on-time delivery rate Attempt to capture all reasonable training costs ...Affect Productivity? Over What Time Period? Absenteeism; efficiency …Improve The Soft Skills Of The Work-force? Employer Surveys Tardiness, discipline, grievances, initiative, flexibility, problem-solving, teamwork, communication, confidence, loyalty …What Are Direct Costs To Employers Participating In The Programs?

21. Sector Workforce: Lessons from Implementation Studies Source: King, Christopher (Forthcoming in 2014). SectoralWorkfroce and Related Strategies: What We Know…and What We Need to Know. In M. Conway and R. Giloth, Workforce Intermediaries and Sector Strategies in an Uncertain Economy: A Decade of Research and Practice.

22. Workforce Intermediary Policies • Various pieces of federal workforce legislation and funding have promoted the sector approach and provided some money for intermediaries • Five to seven states have passed modest to ambitious policies to support workforce and industry partnerships • At the same time, federal workforce resources are declining and several states have dismantled sector programs and policies

23. Financing Challenges for Workforce Intermediaries • The National Fund started with the assumption that showing compelling evidence and the ability to replicate would unlock business and public sector funding. • Neither has proven the case, especially in light of recent recession. • Now there is more attention to community and technical education without an employment focus. • The question is whether philanthropy and its partners can stay the course in supporting sector-based workforce intermediaries.

24. Challenges and Opportunities Ahead for Workforce Intermediaries • Convening a field-wide conversation about the future of sector strategies and workforce intermediaries • Tapping the interests of a larger group of businesses, unions, and educational institutions • Sustainable funding model; fidelity of partnerships; effective policy agenda

25. Challenges Ahead for Workforce Intermediaries • Support ongoing engagement of philanthropy in building the sector-partnership field • Assess the relevance of workforce intermediaries for growing low-wage sectors like retail, hospitality, and health • Spread a different form of sector intermediary that addresses job quality and policy advocacy as well as skills training • Continue to build the evidence base for workforce intermediaries and the sector approach

26. Maureen Conway, Director Aspen Institute, Washington, D.C.www.aspeninstitute.org Robert Giloth, Vice President Annie E. Casey Foundation, Baltimore, MD www.aecf.org Forthcoming Publication: Sector Strategies and Workforce Intermediaries in an Uncertain Economy.New York: American Assembly, 2014