Building Better Partnerships: Workforce and Economic Development

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Building Better PartnershipsWorkforce and
Economic Development
Presented by Dr. Tim Alford Director, Alabama
Office of Workforce Development May 5, 2006
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Relationship

• Workforce Development
• Economic Development
• Key Location Factors
• Workforce productivity
• Workforce availability
• Workforce costs
• Louisiana State University Study - 2005

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Conventional Wisdom
Old Smart people go where the money
is. New Money goes where the smart people are.
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What is economic development?

• Process, not an event
• Enhanced quality of life
• Rising standard of living
• New community wealth

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Economic Development usually boils down to

• New business recruitment and attraction
• Existing business retention and expansion
• 3) New business creation and start-up

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Who Does Economic Development?

• No single model.

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An Average Local Economic Development
Agency(E.D. Corporation, Chambers, Local
Government, Regional Planning Councils)

• 4.1 FTEs
• 660,851 Average Budget
• 261,000 Mean Population of Service Area

Source NAWB
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Organizing Economic Development
Facilities Location
Capital
Business Management
Regulatory Climate
Infrastructure
Strategic Planning, Research, Policy Development
Info Sharing
Workforce Prep Development
Professional Network
Tech Product Development
Product Process Improvement
Marketing Sales
Source Center for Regional Economic Development
Competitiveness
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What Defines Success?

• Jobs created and retained
• Investments made
• Tax revenues
• National Association of Development Agencies, 1999

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Economic Development Strategy

• Old Shoot at everything that flies claim
  everything that falls.

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Strategy Trends

• New
• Privatization of ED organizations
• Serving groups of firms rather than individual
  clients
• Developing industry-specific expertise
• Increased use of web (for serving clients and
  marketing)
• Partnerships with private firms for marketing and
  delivering specialized services

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ED System Problems / Issues

• Independent funding streams requirements
• Decentralized and chaotic competitive/collaborati
  ve
• Tensions from mission creep uncertainties about
  policy roles and conflicting missions
• Voluntary cooperation due to enlightened self
  interest

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What Is Workforce Development?

• Pre-service and in-service preparation for work.

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Organizing Workforce Development
Workforce Prep / K-12 Education
Job Seeker Focus
Assessment
Recruitment and Pre-Screening
Training / Retraining
Job and Skill Analysis
Strategic Planning, Research, Policy Development
Info Sharing
Retention Assistance
Training / Skill Enhancement
Employer Focus
Placement
Layoff Aversion
Rapid Response
Source Center for Regional Economic Development
Competitiveness
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ComparisonPhilosophy / Language

• Economic Developers Workforce Developers
• Company-focused ? Individual-focused
• (firms and industries) (occupations and
  skills)
• Business background ? Social service background
• Tax policy, Financing, ? Counseling,
  supportive
• Real estate development services
• Return on Investment, ? Eligibility,
  self-sufficiency standards,
• location quotients, terminations

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Defining Success /Performance Metrics

• Economic Development Workforce Development
• Jobs created and retained ? Placement
• Public investments made ? Retention after six
  months
• Private investments leveraged ? Earnings after
  six months
• Tax revenues ? Skill attainment/credentials
• ? Customer satisfaction
• ? Graduation rates

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What differences do you see between Workforce and
Economic Development?

• Authorizing Federal statute(s) / Funding streams
• Metrics for success
• Historically different focus (job seekers vs.
  firms, blue-collar vs. white collar)
• Short-term vs. long-term focus
• Culture / language

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Mutually Beneficial Activities

• What are we trying to accomplish together?
• Who are the partners? providers? participants?
  employers?
• What are the resources / strengths / limitations
  / weaknesses / capabilities of potential
  partners?
• How can we leverage resources avoid duplication
  achieve synergy?
• What is our plan / strategy?

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Identify and Analyze Performance Gaps
Performance Gaps
WHAT SHOULD BE
WHAT IS
Cause of Gap
Inadequate Capacity for Economic Innovation
Inadequate Talent
Inadequate Infrastructure
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Framework
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Aligning Workforce andEconomic Development Plans

• Reconciling whats required vs. the big picture
• Reconciling different geography, political
  jurisdictions, metrics
• Reconciling short-term vs. long-term perspective
• Sharing data on employer needs and opportunities
• Identifying common goals, activities
• Using available resources efficiently and
  effectively

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Alabamas New Workforce / Economic Development
System
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Key Forces Shaping Alabamas Workforce

• Rapid technological change / job churning
• Chip speeds double every 18 months
• Storage capacity doubles every 12 months
• Bandwidth doubles every 6 months
  Rich Karlgaard, Forbes (2000)

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Key Forces Shaping Alabamas Workforce

• Business Must
• Innovate
• Emigrate
• Evaporate

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Key Forces Shaping Alabamas Workforce

• Aging of the labor force
• Dear Friend
• The enclosed AARP card has never been more
  valuable to you than it is today.

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Key Forces Shaping Alabamas Workforce

• Globalization
• Check out Korea
• 47 million people
• S. Korea is blessed with a computer-literate
  population that reflects a heavy emphasis on math
  and science education an industrial battle plan
  for the future. (Financial Times 11/19/00)
• Suppressed entrepreneurial talent is finally
  being unleashed (Financial Times 11/19/00)
• Hyundai

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Key Forces Shaping Alabamas Workforce

• Alabamas standard of living versus education and
  skills

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Key Forces Shaping Alabamas Workforce, continued
1950 2000 College Degree Skilled Unskille
d
About 20 20 60
About 20 65 15
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Residents with Bachelors or Higher Degree
(Percent)
30.9
27.9
24.7
24.7
24.0
19.8
19.1
16.8
16.8
15.9
15.2
13.4
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0

• Population 25 years and over.
• Source U.S. Census Bureau, Census 2000.

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Metro Area Median Family Income FY2003
59,700
54,200
51,300
51,300
50,600
48,600
47,200
46,900
46,700
44,700
44,400
42,900
0
20,000
40,000
60,000
Source U.s. Dept. of Housing Urban Development
Office of Economic Affairs
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Key Forces Shaping Alabamas Workforce

• Integration of Special Populations
• Persons with disabilities
• New immigrants
• Former justice system offenders
• Returning military veterans
• Seniors
• Out-of-School Youth

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Key Forces Shaping Alabamas Workforce
Transition From cheap land, cheap labor
economic development strategy To Advanced
manufacturing, technical services increased
productivity based on applied technology
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Automotive Sector Mirrors These Trends and Issues
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If the automotive sector follows its expected
business cycle, it will require 44,000 workers by
2025. Source Center for Business UA
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Of the 44,000 workers 13,000 are
additional Source Center for Business UA
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2,100 of these additional workers will be high
demand, multi-craft maintenance
occupations. Source Center for Business UA
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If sector expands by 25 and adds 1 OEM, the
sector will need 70,000 workers by
2025. (Roughly doubles current employment.
Discounts replacement.) Source Center for
Business UA
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So
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Alabama has been working to
Develop a comprehensive, coordinated,
demand-driven, customer-focused workforce
development system.
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Current Initiatives
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Current Initiatives, continued
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Career Tech
HUD
K-12
ETA
WOTC
WIA
CASAS
TABE
GED
TAA
ESL
Career Ed
Youth
OWD
DPE
Dislocated Worker
Vets
Rehab
Wagner-Peyser
TANF
NEG
Higher Ed
HHS
DOE
EMILE
ES
Job Corps
DOL
ES
DIR
LMI
ACSI
ACHE
Perkins
AIDT
ABE
Workforce Development Partners
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DIR
NEG
Career Ed
CASAS
TANF
DOL
Dislocated Worker
Youth
ESL
OWD
LMI
ESL
Vets
Wagner-Peyser
Career Tech
DOE
ETA
AIDT
ES
WIA
EMILE
Perkins
ACHE
TAA
ACSI
HUD
Higher Ed
WOTC
Rehab
ABE
K-12
Job Corps
GED
TABE
HHS
DPE
UI
working as a system.
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Regional Advisory Councils Purpose To act in an
advisory capacity to the Alabama Workforce
Investment Area Board which is the designated
entity for the 65-county Workforce Investment
Area. The Regional Advisory Councils role is to
provide guidance and input on regional activities
and services for the Alabama Workforce
Development System.
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Focused Industry Training

• FIT Curriculum includes
• Basic Education
• Computer Skills
• Problem Solving
• Workplace Behavior
• Manufacturing
• Job Acquisition

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Quickstart Centers of Excellence in High Growth
Sectors

• Alex City Automotive Manufacturing
• Boaz Health Care
• Cullman Tool and Die
• Decatur Advanced Manufacturing, Health Care
• Dothan Health Care
• Hanceville Advanced Manufacturing
• Mobile Welding, Shipfitting
• Montgomery Automotive Manufacturing
• Muscle Shoals Advanced Manufacturing
• Scottsboro Industrial Maintenance Technician
• Southeast Alabama - Aviation

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Initiatives, continued

• Cluster Approach (e.g. Healthcare, Aerospace)
• 21st Century Technician (e.g. Industrial
  Maintenance)
• ATN Alignment (Incumbent Worker Training Provider
  Advanced Manufacturing, Lean, Six Sigma, etc.)
• Marketing - Directory

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Initiatives, continued

• One-Stop Career Centers Business Services
  Approach
• Better alignment Economic Development
  Workforce Development

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Incumbent Worker Training

• More than 100 Alabama businesses
• currently in program

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Worker Credentialing

• Focused Industry Training Alabama Certified
  Worker
• WorkKeys Career Readiness Certificate
• Bronze Level
• WorkKeys Career Readiness Certificate
• Silver Level
• WorkKeys Career Readiness Certificate
• Gold Level

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Worker Credentialing, continued

• Realignment of all public workforce development
  programs with applied job skills outcomes using
  WorkKeys
• Adult Education
• WIA Youth
• Alabama Technology Network
• K-12 Career Tech
• Incumbent Worker Training
• Community College

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State Workforce Development PlanCRC
ProposalCRC Implementation Planvisit
theOffice of Workforce Developmentwebsitewww.
owd.alabama.gov
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WORKFORCE

• The New Imperative in Economic Development

Office of Workforce Development