January 2016

Chris Shannon: Welcome to the Federal Reserve's Economic Development podcast series. I'm Chris Shannon with the Federal Reserve Bank of Boston.

Regional workforce efforts in the workforce development field provide coordination in a system made up mostly of local, individual service providers. This has been a research focus at the Atlanta Fed; in addition to their community and economic development department, they participated in the creation of a regional workforce system in metro Atlanta. Economic developers may be in a unique position to lead these regional workforce efforts.

Stuart Andreason
Stuart Andreason
Dee Baird
Dee Baird
The International Economic Development Council, or IEDC, has explored broad-based workforce development coordination through the lens of the economic development field and the role economic developers can play in a study entitled "Shifting Workforce Development into High Gear: How Economic Developers Lead Workforce System Alignment."

We're speaking today with Stuart Andreason, senior adviser for human capital and workforce development at the Atlanta Fed, and Dee Baird, president and CEO of the Cedar Rapids Metro Economic Alliance and member of the IEDC Workforce Development Task Force that guided the study's development. Welcome, Stuart and Dee.

Stuart, let's start with you. What does your research indicate about trends in regional workforce coordination?

Stuart Andreason: Regional collaboration and workforce development is really starting to happen across the country in communities of varying sizes, economic bases, and geographic areas. Regional collaboration has become really important because as workforce development and the communities around it have become more complex, there's been growing interest from a variety of organizations from traditional workforce development organizations like workforce development boards, colleges, universities and community colleges, nonprofits, businesses, and philanthropy are more and more becoming interested in developing collaborations. The collaboratives can help to promote stronger coordination and alignment among the many players in the workforce development community today.

Initiators really come in many different sizes and types. Economic development organizations have started collaboration because of the growing importance in human capital and business location. Philanthropies have initiated efforts in other communities because they see the important role that it can play for low- and moderate-income populations. Sometimes traditional workforce development organizations have catalyzed regional collaboratives because they understood the partnership could enhance the quality of work that they did. Often it's driven by groups of these organizations.

Shannon: And why is this so important? Why is the workforce coordination really important, in your opinion?

Andreason: With the growingly complex system, the services that are offered are much more complex and it can be difficult for a business or for a job seeker to understand where they can go to get training, where they can go to get information on the labor market. So the collaboration and coordination can help to create a more accessible system to businesses and job seekers and it can make it more coherent for organizations that are doing similar work.

Shannon: Stuart, I'm really fascinated by the regional network that was created in metro Atlanta. Can you describe key findings from the experience of this regional network?

Andreason: Atlanta is a large and complex metropolitan area. It had a number of effective, but often disconnected, workforce development organizations. The region is large, but really it's only one labor market. To that end, though, it had five workforce development boards. There were many other organizations that were doing work that were outside of the traditional workforce development system. A group of organizations came together to discuss ways that the system could collaborate and coordinate with each other. Those stakeholder organizations ranged from representatives of the traditional workforce development system, the technical and community college system, and the university system. It included philanthropy and business and economic development organizations.

The first step was to find out what services were offered, where they were offered, and who the organization served. We surveyed over 200 workforce development organizations and found that those organizations have over 500 locations for workforce development services across the region. The unfortunate finding was that only 30 percent of those organizations had a relationship with business.

The key next step for the organization is to better connect with the business community. This takes time and includes developing individual relationships and understanding where there are quality connections to training that businesses need and where working can make the system more accessible and prominent. The group has formalized under the title the Metro Atlanta Exchange for Workforce Solutions.

Shannon: One last question, and this is actually for both of you, Dee and Stuart, what do both of you see as some of the key barriers to regional workforce alignment? Let's start with Stuart.

Andreason: One thing that we saw is that organizations can be cautious initially, if they may be concerned about how working together could affect or diminish their own organization's work or funding. Finding funding and leadership for sustained efforts to improve systems can be quite a challenge. Often funders prefer to put money directly into service for populations, and sometimes the funding must be spent on service provision and not on systems improvement.

With multiple organizations involved, there were obviously competing visions for the future, and complex, locally responsive efforts in workforce development really take time and sustained leadership. We've found that as groups have continued to work together, a lot of the organizations have been able to overcome these barriers because they've seen the positive path forward.

Shannon: Dee, what about from your perspective? What do you see as some of the key barriers to regional workforce alignment from an economic developer's standpoint?

Dee Baird: The reality is that workforce [system] is now becoming the biggest incentive for economic development projects. And the fact that economic development professionals now have to understand the workforce system, and particularly understand the individuals that are served by the workforce development organizations, is probably the biggest barrier to change. So when economic developers are working with businesses, and workforce development professionals are working with individuals, there's a big disconnect between those two professions in terms of how we're going to work out these issues together. For economic development organizations to be successful, they have to get into an understanding and/or into partnerships in this area that they've never been in before.

Shannon: Dee, let's explore this a little bit further. Why should economic developers be more broadly engaged in workforce development, and what new information does the IEDC research bring to the conversation?

Baird: To answer the first question, it's important that we go back to a point that I made earlier: the economic development organizations don't have a choice. They have to get into being able to articulate the workforce supply chain for particular projects, or business prospects, or clients that they're working with. What we're trying to do in this research is really help them understand not only the language, not only to understand the framework that workforce development organizations are built around—federal legislation to state legislation—but to also understand how critical it is that partnerships and collaborative efforts come together in order for both organizations [and] professionals to be successful.

I think the common framework that we're seeing is really industry clusters and sectors. So when workforce development organizations are preparing individuals to be successful in a future educational path, training path, or career path, it's typically focused around an interest of a career in a particular sector that they might be interested in. An economic development organization certainly understands industry sectors as well as the industry clusters that are necessary for their particular communities, or their regions, or their states to be successful in. So that's really the language that I think can bring the two entities together.

Understanding this complex world of both state and federal legislation is important, and then what we've done through the research and what we think is really important is to give examples.

So, we've gone all the way from 10 county regions in a rural area to large metropolitan areas. The driver can be different; it can be a crisis, it can be that a small rural community has lost a major manufacturer or a major employer, and they were caught off guard, and that's what's caused the burning platform for them to look at a different model going forward, all the way to high unemployment rates. There's a real need, from a socioeconomic standpoint, for workforce organizations to work with the economic development organizations to get people in meaningful jobs.

Shannon: You referenced several specific examples of locations where these efforts are aligned. Are they being led by economic developers, and can you provide a few more examples of those locations and then provide some insights, or key reasons, why those particular initiatives are so successful?

Baird: I can give you some specific examples, but the thing I will tell you is that none of them look alike. That was the other thing that we learned through the research: that there are different models and there isn't one way to go at this where it can be successful. In some cases, it can be a state-led initiative like we've seen in Oklahoma, where the governor has really grabbed a hold of it. There's a couple of state agencies that have been given this responsibility by the governor and it's really been a statewide, top down, then pushed out and serving the individual counties and cities within a state.

We've also studied a rural network in North Carolina; it's called the Eastern Carolina Workforce Innovations Network. That one in particular has three different workforce boards, 13 rural counties in eastern North Carolina. It's really been a combination of the regional economic development group, but those workforce boards have really come together and co-led that particular initiative.

The Middle Tennessee Regional Workforce Alliance was a state legislation that was passed in 2010 for higher education institutions, and the presidents of those organizations have been the ones leading that effort in that particular state.

So, we've seen all shapes and sizes. There's no specific one type of model at which there is an obvious driver, but there are many ways and shapes of collaboratives that can be successful.

Shannon: Dee and Stuart, thank you both for speaking with us today. This concludes our podcast with Stuart Andreason and Dee Baird. For more podcasts on this topic and others, please visit the Atlanta Fed's website at frbatlanta.org. If you have comments or questions, please email podcast@frbatlanta.org. Thanks for listening.