By Donna Clapp
From the May/June 2022 Issue
You may have heard it is currently an “employees’ market” in terms of hiring, and that is absolutely an understatement, with media calling the time period in which we live, “The Great Resignation.” With an unemployment rate of 3.6% for March 2022, we have lower unemployment than we did pre-pandemic when it was at 4.4% in March of 2020. This nationwide workforce shortage has become top of mind in terms of both business concerns and economic development strategies.
“It’s all really supply and demand,” said Dennis Donovan, Founder of Wadley Donovan Gutshall Consulting, corporate site selection consultants. “You’ve got baby boomers leaving the workforce, limited immigration, and heavy competitive demand.”
Well, guess what? That’d be the reason for labor shortages. But then of course, we need to look at the fact that as a country, we have not done a good enough job career pathing for some of the technical fields either. So, particularly in manufacturing just finding workers at all is so difficult right now. I think communities are going to have to have workforce development as one of their most important pillars right now. And a goal really should be to have the number of workers in positions, mirror the percentage of diversity in the adult population of that region.”
In fact, in many communities, the labor shortage has turned economic development strategy upside down, because bringing jobs to the community has always been the focus, but now developing a skilled workforce has become even more of a focus than ever before. Without creating workforce development programs that help attract, train and retain workers, economic developers risk corporations choosing other locations for their expansion and relocation projects.
In the past, traditional measures of economic development have focused on the number of jobs being created, and the amount of capital investment being made,” said Todd Greene, Chair of the Board for the International Economic Development Council (IEDC), and Executive director of WorkRise at the Urban Institute. “But we’ve found, that over time just meeting those measures has been insufficient when we think about economic growth of the entire community. Further analysis reveals that not everyone has benefited from traditional economic development approaches, and in some cases, these communities have very low rates of economic mobility and high rates of income inequality. We know that bringing along all members of the community is going to be a more successful strategy and should be the goal of economic development.”
Corporate leaders and economic developers are giving even more attention to programs and initiatives that target diversity, equity, and inclusion than ever before, giving vulnerable communities new opportunities to grow. These new initiatives call for new types of partnerships and collaborations between federal, state and local governments, educational institutions from high schools to universities and community outreach organizations. One such recent collaboration in South Carolina has helped the state attract a number of large corporate entities from BASF to BMW. While the Apprenticeship Carolina program has been in place since 2007, a recent collaboration seeks to increase the diversity of participants in the apprenticeship programs.
“Some of the things that we’ve been doing on our team, is we formed partnerships with the three urban league chapters of the state,” said Amy Firestone, Ph.D. Vice President, Division of Apprenticeship Carolina. “Since 2021, we have been collaborative partners in helping identify businesses to talk to about creating apprenticeships with the focus on diversity. We have also developed pre-apprenticeship program with the Urban League, and that’s also the first ever pre-apprenticeship program that we’ve ever had with a community-based organization.”
South Carolina’s apprenticeship and pre-apprenticeship programs are an example of unique partnerships that are creating highly skilled workforce pipelines from high school through to high wage jobs. They require a tremendous amount of collaboration. For example, a recent apprenticeship launch with BASF in Pendleton, SC was a collaboration between BASF, Apprenticeship Carolina, readySC and Tri-County Technical College.
Elba Lizardi, BASF Seneca site director, said the program aims to meet future talent needs for a skilled and diverse technician workforce with an emphasis on attracting more females to these roles. “Our company wants to grow in diversity and inclusion at this site and globally,” she said. “We met our goal for 22-24% female leadership two years before our 2021 goal in 2019, so we set a new goal of 30% female leadership by 2030, and this program helps us make progress on achieving that goal.”
Note that it is a technical college in this particular collaboration, not a university. According to the World Economic Forum, while all jobs are getting more technical, the emergence of clusters of professions for the future shows a shift in focus from degrees to skills.
“Major IT and Business Services companies are approaching community colleges for a well-trained, hands-on, ready to work and often industry-certified workforce. And they only have an AAS rather than a BAS. It is not the degree but the technical and personal/workplace skills,” said Linda Head, Sr. Associate Vice Chancellor, External & Employer Relations at Lone Star College in Texas.
The good news is this allows for a larger workforce that can represent the diversity of our populations and help close the employment and opportunity gaps that currently exist. All of this calls for a focus on upskilling or reskilling workers into these new roles, and there are numerous regions around the country who are focusing on just that. Corporations are focused there too according to consulting firm, Deloitte, whose recent survey found that many corporations since 2020 have made public commitments to address societal disparity, and injustice, and to expand diversity, equity, and inclusion initiatives for their current and future workforce.
Addressing Workforce Shortage
The Brookings Institution, a public policy organization focused on research and development, has been doing numerous studies on what will work in terms of adapting to this hiring crisis. One of the examples they point to is the way EmployIndy in Indianapolis has been collaborating with employers and nonprofit partners to set up data sharing agreements with the state so they can target local populations that were displaced during the pandemic. EmployIndy has been sending weekly texts to new unemployment applicants to ask them to speak to a career navigator to discover how their skills may transfer to jobs currently available.
Much like Apprenticeship Carolina, CareerWise Colorado has worked with employers and educators in seven targeted industries to create youth apprenticeships, a model that is currently expanding to Washington DC, New York City, and Elkhart County IN. CareerWise Colorado also recently launched a program they call Equity First, which is an apprenticeship program designed specifically to help employers meet their diversity, equity, and inclusion goals by providing anti-bias and inclusive leadership training and support to corporations.
“It’s a business imperative to focus on diversity and inclusion—and the Equity First program was another tool in our toolkit to help us continue to advance our DEI efforts,” said Chris Mast, the Mountain States Leader for Health at Mercer, a global professional services firm and one of the first of Colorado’s Equity First partners.
While these programs’ examples are all driven by public entities, there are some areas where corporate leaders are driving the initiative.
For example, The Chicago Apprenticeship Network was founded by Aon, Accenture, and Zurich North America, and has expanded to include more than 40 companies in various industries in a collaboration that includes educational partners and nonprofit partners. According to the reports Brookings has done, apprenticeship programs that involve several partners are the least expensive and most effective programs, making public private partnerships key to success. This kind of applied learning that involves both classroom learning and on the job learning is an apprenticeship model that works well for both experienced workers, and even younger workers.
“You know, 40 years ago we had these vocational school programs and we built capacity, and then we stopped building them,” says Annelies Goger, PhD Fellow at the Brookings Institution. “Since the 1980s the U.S. has scaled back vocational education, which reduced the options available to students who prefer hands-on learning or can’t afford a four-year college degree. It also reduced options for employers who want a stable pipeline of workers for trades, technology, crafts, and even clinical professions. And now we’re like, well, why don’t we have people that know how to do these things? That is a good question, and the answer is that we need to put funding streams back into those areas and expand on them, of course. I also think we should be looking at apprenticeship programs similar to those they have in Europe that tap into younger students and expose them to more career paths to consider, and more ways to train to get into those fields.”
North Carolina has taken on just this kind of initiative with its North Carolina Triangle Apprenticeship Program. This enterprise looks to develop engineering and technology talent in the Research Triangle area with a four-year program that starts in the 11th grade!
Broad-Based Efforts To Equity
Access to these kinds of work-based learning opportunities that start in high school have proven to be successful in creating a long-term worker pipeline, but if they are to affect the racial disparities in education and employment outcomes in a positive way, they must be combined with other community wide efforts.
“No single institution or sector is responsible for racial disparities in education and employment outcomes. Rather, they are community-wide challenges involving a myriad of issues—from food insecurity, to lack of access to livable wages, to trauma and gun violence—all with roots in the history of race in America,” said Claire Fiddian-Green, President and CEO of the Richard M. Fairbanks Foundation and co-chair of Indiana’s Business Equity for Indy’s Learning and Talent Opportunities Taskforce. “What’s clear is that the status quo is unacceptable, and that we must drive change in a collaborative, cross-sector fashion.”
That’s exactly why Indiana put together the taskforce. The report the taskforce created through their research included suggestions for increasing student’s exposure to work-based learning opportunities in high school, increasing access to and completion of postsecondary education through Indiana’s 21st Century Scholarship programs, and mandating FAFSA completion for all high school seniors.
“At the Indianapolis Urban League, one of our goals is to improve access to jobs with a living wage and good benefits,” said Tony Mason, President and CEO of the Indianapolis Urban League. “That requires employers and the community to work together to refine jobs and workforce programs that provide the hands-on support that empowers people with the tools they need to succeed while also removing barriers. As Black people and other communities of color continue to get left behind at significantly higher rates, this is incredibly important not only to individuals and families but our entire city and our economic well-being.”
“Diversity is a hallmark of Montgomery County.We’re one of the most diverse counties in the country with 150 languages spoken in our schools and one-third of our residents foreign-born…We want to make sure that all residents can share in our prosperity and developing an inclusive economy is a priority for us.”
— Benjamin H. Wu, Montgomery County Economic Development Corporation
To this end many regions have started hiring professionals whose focus is on diversity, equity, and inclusion. For example, Oklahoma City recently hired Shalynne Jackson as its first Chief Diversity and Inclusion officer specifically tasked with executing the city’s strategy for diversity, equity and inclusion by providing training, implementing best practices and providing coaching, guidance and education.
“It’s an honor to be selected as the first person filling this role at the City of Oklahoma City,” said Jackson. “I am passionate about cultivating a culture of equity that promotes authenticity, access, and advancement. I look forward to partnering with leaders across the organization to drive meaningful change that enriches the lives of employees and the community alike.”
More than 30 states now have diversity councils to help forward the initiatives needed to foster diversity, equity, and inclusion through partnerships, advocacy, and education that are essential to create a sustainable ever-growing workforce for the future.
In February of this year, IEDC announced its first Equity Communities Cohort, as part of its Equitable Economic Development Playbook. The five organizations participating in this Cohort are The City of El Paso (El Paso, TX), Elevate Rapid City (Rapid City, SD), Village Capital (Cleveland, OH), Montgomery County Economic Development Corporation (MD), and St. Louis Development Corporation (St. Louis, MO). These organizations will receive technical assistance through visits, webinars, and cohort check-ins and create an Equity Action Plan based on their local needs and challenges.
“Diversity is a hallmark of Montgomery County. We’re one of the most diverse counties in the country with 150 languages spoken in our schools and one-third of our residents foreign-born,” said Montgomery County Economic Development Corporation President and CEO Benjamin H. Wu. “We want to make sure that all residents can share in our prosperity and developing an inclusive economy is a priority for us. Participation in the IEDC Equity Communities initiative will help further our local and regional efforts to promote equitable practices and standards.”