eta

The Road to WIRED

Performance and Reporting Summit
September 18, 2007
Mesa, Arizona
Jennifer M. McNelly
Administrator
Office of Regional Innovation and Transformation
eta Overview

• The workforce system and its evolution.

• The changing economy and the importance of

talent development.

• ETA’s initiatives to transform the workforce

system.

• Using talent development as a driver of

regional economic growth.
 The Birth of the Workforce
eta System (1930s)

• The U.S. Employment Service and the

Unemployment Insurance Program were
created to assist unemployed workers in the
industrial economy.

• These programs were statements of the

government’s commitment to minimize the
hardships of the unemployed and to facilitate
their return to work.
 The Birth of the Workforce
eta System (1930s)
• The economy of the day was industrial
with:
– Interchangeable labor
– Cyclical layoff and hiring patterns
– Work that required no more than a high
school diploma.
• The system was termed “Employment
Security” and its functions mirrored the
name.
• 70 years later, the Employment Service
remains virtually unchanged.
eta Wagner-Peyser Act Structure

DOL

Governor

State Agency

State’s Local Office State’s Local Office State’s Local Office State’s Local Office

• Local offices are staffed by state merit-staffed

employees.
• Today, Local offices frequently exist along
side of One-Stop Career Centers, resulting in
duplication.
 Expansion into Job Training
eta (1960 – 1970s)
• An ever-growing job training system
was built:
– The Manpower Development and Training
Act (MDTA) was enacted in 1962.
• Described as a “careful treaty between the
Employment Service and the vocational education
system.”
– The Comprehensive Employment and
Training Act (CETA) was enacted in 1973,
replacing MDTA.
• Had little private sector involvement.
• Over 40% of the participants were
engaged in subsidized employment.
eta CETA Structure

U.S. Department of Labor

Prime Sponsor Prime Sponsor Prime Sponsor Prime Sponsor

(Local) (Local) (Local) (Balance of State)

• Moved to a more decentralized system.

• “Prime sponsors” were direct recipients of
Federal grants and had basic programmatic
responsibilities.
• Cities and counties with populations of
100,000 or more were prime sponsors &
states were prime sponsor for all other areas.
• No state role where local served as prime
sponsor.
 First Steps toward Demand
eta Driven (1980 – 1990s)
• The Job Training Partnership Act
(JTPA) was enacted in 1982, replacing
CETA.
– President Reagan was concerned that “the
government has trained thousands…in
skills that...aren’t needed in their
communities.”

• JTPA eliminated public sector

employment and required that 70% of
funds be used for “training.”
eta JTPA Structure

US Department of Labor

State Council

State Agency

Local Government
Private Industry Council
(Service Delivery Area)

Training Providers

• Established a more limited Federal role.

• Encouraged coordination with other job training
programs.
 1998 Workforce Investment
eta Act

• The Workforce Investment Act (WIA)

was designed to:

– Streamline service delivery through One-

Stop Career Centers;
– Strengthen performance accountability;
– Promote universal access to services;
– Create business-led state and local boards;
– Promote individual choice.

• Strong bi-partisan support.

eta WIA Structure

Education DOL HHS

Governor

State Board

State Agency State Agency State Agency

Local Government

Local Fiscal One-Stop Career

Local Board Training Providers
Agent Center
eta Common Themes

• In 1983, an expert wrote, “the major issues in

the development of manpower programs…have
been as much the power relationships among
contending parties as the program’s substance
itself.”

• Contending parties include states, local areas,

community groups, worker advocates, and the
business community.

• Twenty-two years later, little has changed.

 Workforce Investment
eta System Spending
Departments FY06 Appropriations

Labor $9.89 billion

Education $4.40 billion

HHS $701 million

HUD $49.5 million

Total $15.04 billion

eta Evolution of the Economy

• When the workforce system was first

created:
– United States was an industrial economy
and labor was virtually interchangeable.
• We are now in a knowledge economy
where specialized skills are needed.
– 90% of the fastest growing jobs require
education and training past high school.

– 63% of all new jobs in the next decade will

require a college degree; & only 30% of the
population has a college degree.
eta Evolution of the Economy

Less High Some Assoc. 4-Year

than School College Degree Degree
High Grad and
School Higher
Employment
Growth
-129 87 177 380 723
(thousands)
Average $479 $660 $767 $812 $1,243
Weekly
Earnings
Unemploy- 8.5% 5.0% 4.5% 3.7% 2.7%
ment
Rate

Source: BLS Current Population Survey 2004

eta Evolution of the Economy

• Today, individuals must be able to constantly

update their skills and employers must have
real-time access to needed talent.

• A fragmented, social service system was

sufficient for the economy of the 20th Century,
but can no longer meet the demands of the
21st Century global economy.
 Transforming the Workforce
eta System
• Through the stages of evolution, the
workforce system has always operated
outside the economic structures of the
community.

– Little or no interaction with area employers.

– Minimal contact with existing educational
institutions; instead created its own cottage
industry of job trainers.
– No coordination with economic development.

• Each of these issues is now being addressed

by national initiatives.
 Transforming the Workforce
eta System
• President’s High Growth Job Training
Initiative

– Involved employers from leading sectors of

the economy in the design and development
of training programs.
– Used existing education resources such as
community colleges.
– Invested over $220 million in 122 projects
that develop education and training
solutions to specific workforce challenges.
 Transforming the Workforce
eta System
• President’s Community-Based Job
Training Grants

– Experience with the High Growth Initiative

showed that community colleges must
improve their ability to develop talent
through:

• Stronger relationships with employers

• Expanded and specialized faculty
• Improved facilities
• Up-to-date equipment

– 70 grants totaling $125 million were

recently awarded; new competition
announced.
eta Economic Development

• Workforce development is more than training

effectively for current jobs.

• Successful workforce investment leads to the

creation of new jobs.

• Talent is an asset, bringing new businesses

and industries into communities.

• Economic development is also experiencing a

transformation.
– Tax breaks and incentive packages are no longer
enough.
eta Innovation Economy

• Economic development must now establish the

conditions for innovation.

• The Council on Competitiveness’ Innovate

America report identified three requirements for
innovation:
– Infrastructure (transportation, technology)
– Investment (availability of capital)
– Talent

• These conditions should be maximized at the

regional level, where the forces of the economy
combine to spur growth.
 Workforce Innovation in
eta Regional Economic Development

• WIRED will focus on the talent development

part of building a regional economy.

• The goal is to expand employment and

advancement opportunities for workers while
simultaneously catalyzing the creation of
high-skill and high-wage jobs.
eta WIRED Map
eta WIRED Initiative

• $325 Million Invested in 39 Regional

Economies

• WIRED Principles and Framework are

Drivers for the Entire System.
Funding over 3 years.
– Technical assistance
– Data tool that incorporates economic,
research & development, investment, and
real-time job information.
•Picture of regional economy and economic assets.
eta WIRED Initiative

• Regional Activities:
– Formation of a broad-based regional
leadership team.
– Assessment of region-wide assets and
strengths, risks and weaknesses.
– Development of a comprehensive
implementation plan for the region
identifying how WIRED and other resources
support regional economic goals and
strategies.
 Examples of Some Regional
eta Strategies & Goals
• Northwest FL: known as a tourist destination,
but now plans for a enlarged port, new
international airport, and expanded military
presence, they hope to build an new economy.
• West AL & East Miss.: have shared the struggle
of so many rural areas. But by combining their
resources, they hope to break the legacies of the
past and provide the education and economic
development needed to grow.
• North Central IN: manufacturing base and
young people left the region. Reversing the trend
by focusing on advanced materials and agri-
business.
eta Initiative Goals
• Strategy Development

– Map existing economic landscape;

understand region’s strengths and
weaknesses and identify opportunities.

• Galvanize Regional Networks

– Build a leadership team consisting of civic,

business, investor, academic, entrepreneur,
and philanthropic members.

– Form consensus on action agenda and gain

leadership commitment.
 Using Talent Development to
eta Transform the Workforce System
• Legislative Proposals to Enhance Talent
Development
– WIA Reform Principles (WIA Reauthorization bill
transmitted to Congress in April 2007)
– TAA Reauthorization Principles

• Administrative Reforms to Promote Talent

Development
– 548 Approved WIA Waivers
– New WIA State Plans
 Using Talent Development to
eta Transform the Workforce System

• WIA Reform Principles

- Strengthening workers’ ownership of their

careers.
- Increasing post-secondary education &
training opportunities.
- Significantly increasing the number of
workers trained.
- Improving governance.
- Promoting state and local flexibility.
- Strengthening One-Stop Career Centers.
- Improving Performance Accountability.
 Using Talent Development to
eta Transform the Workforce System
• Trade Reauthorization Principles: The Department
has identified four overarching priorities for
reauthorization.

– Trade-affected workers must have increased individual

opportunity to “earn and learn” through the TAA program
by having access to transitional benefits. Benefits under
the program should include a menu of services that allows
the worker to choose the option that best fits his or her
individual needs.
– Trade-affected workers must have improved access to
education and training.

• Reauthorization should ensure greater access to post-secondary

education and training by providing “New Economy
Scholarships.”

– Trade-affected workers must have access to education and

training prior to layoff.
– Trade-affected workers must be able to access services
through a streamlined and efficient workforce investment
system.
 Using Talent Development to
eta Transform the Workforce System

• 548 Approved WIA Waivers

– Funding Flexibility – waivers allow unlimited transfer
between adult & dislocated worker funding streams.
Also allows state/ local areas to use a portion of local
funds or rapid response funds in the same manner as
Governor’s reserve funds to conduct incumbent worker
training and statewide activities.

– Youth waivers have broadened the use of ITAs for

youth.

– Expanded access to training.

– Performance - whereby 20 states now have waivers to

report only common measures & to reduce the
participant data collection burden.
 Using Talent Development to
eta Transform the Workforce System
• New WIA State Plans

– States comprehensively addressed talent development in

their Plans.

– Plans addressed state governance structures and described

actions to integrate systems and break down silos.

– Some states are using real-time data in creative ways to

not only identify growing industries, but also analyze
states’ and regions’ strengths and weaknesses.

– Several states described how the workforce investment

system is partnering with economic development to
support innovation economies in which entrepreneurs and
small businesses flourish.

– States have begun to critically assess the structure of

workforce boards in order to regionally align the operation
of their workforce investment system.
 Positioning ETA to Support
eta Talent Development
ETA is transforming…
Strategic
Knowledge Action Teams
Sharing ETA Culture Strategy
& Policy
Learning
Innovation
Teamwork
Culture Performan Grants Mgt &
Change
Strategic Talent ce Communications
Performance
Development

WIRED Framework
Workforce System Transformational Principles
 Program Administration in
eta Support of Talent Development

• Trade Adjustment Assistance

• Foreign Labor Certification
• Regional Innovation Grants
• Apprenticeship
eta California Trade Impacts

Del Norte Siskiyou

Modoc
Trade Affected Workers within
WIRED Regions Trinity Shasta Lassen

- 12,935 Estimated
Tehama
Plumas
Butte
Glenn Sierra
Colusa YubaNevada
Lake Placer
Sutter

Top Three Layoffs: Yolo El Dorado

Alpine

• Boeing Company Alameda

San Francisco
- 1,951 Est. Workers Santa Cruz
Santa
Clara

• Maxtor Corporation
Monterey
- 1,048 Est. Workers
San Luis
Kern
• Technicolor Home Obispo
San Bernardino
Entertainment Services Santa Barbara
Ventura
Los Angeles

- 625 Est. Workers Riverside

Orange
San Diego
 Demand for Skilled Foreign
eta Talent
Permanent Labor Certifications, by State
80,029 Foreign Workers

2,724 252
New Hampshire
Washington

32 65 52 145
Montana 830 Vermont Maine
North Dakota
856 Minnesota
Oregon 2,332
226 563 7,005 Massachusetts
Idaho
67 Wisconsin
40 South Dakota
2,106
New York
127
Wyoming
Michigan Rhode Island
368 1,719
212 Iowa Pennsylvania 1,296
Nebraska 1,477 5,545
273 536
Connecticut
294 3,551 Ohio
79
New Jersey
Nevada
Utah 771 Illinois Indiana
Colorado 466 West
3,120 320
21,438 589 283 Virginia
Delaware
Kansas Missouri Virginia
California Kentucky
1,123 1,925
41 North Carolina
Maryland

1,229 289 Tennessee

Arizona
223 Oklahoma 248 384 268
New Mexico Arkansas South
Carolina District of Columbia
358 1,789
Alabama
137 Georgia

5,909 537 Mississippi

Texas Louisiana
42
Alaska 0 to 200 workers
5,099 200 to 500 workers
Florida 500 to 2,000 workers
134 2,000 or more workers
Hawaii
 Demand for Skilled Foreign
eta Talent

Total Foreign Talent

(Permanent) San Francisco Bay Area
• 27% (21,438) jobs representing
India, Philippines, South Korea,
China, Mexico, and Taiwan

Educated and Skilled Workforce

• 73% possess a Bachelor’s or
other advanced degree
• 72% already working on H-1B
visas in Advanced Manufacturing,
Information Technology, and
Health Care sectors

Average Wage Offer

• $63,000 per annum

Top Cities of Employment

• Los Angeles, San Jose, Santa
Clara, Sunnyvale, San Diego, San
Francisco, Freemont, Irvine, and
Mountain View

Top Employers California WIRED Data, FY 2006

• Intel, Sun Microsystems, Oracle,
Yahoo, Google, and Juniper
 Engaging Partners & Leveraging
eta Resources for Talent
Development
• U.S. Department of Agriculture - Rural Development
• U.S. Department of Commerce
– Economic Development Agency
– International Trade Agency
– National Institute of Standards and Technology
(NIST)/Manufacturing Extension Partnership (MEP)

• U.S. Department of Defense

• U.S. Department of Energy
• U.S. Department of Housing and Urban Development
• U.S. Department of Transportation
• Environmental Protection Agency
• NASA
• National Institutes of Health
• National Science Foundation
 Engaging Post-Secondary
eta Education
• Advance DOL-NASULGC Partnership
– DOL participation at NASULGC meetings
– NASULGC participation at Workforce Innovations
Conference
• Foster Interaction, Integration, and
Activities Between DOL and NASULGC
Institutions
• Increase Access to Higher Education On-line
Academic Programs in High-Growth Job
Areas
• Increase NASULGC Response to Education
and Training for Military Veterans and
Spouses
 Engaging Post-Secondary
eta Education
• The Community-Based Job Training Grants
highlight the important role community
colleges play in talent development. To
date, we have awarded $250 million in
grants to 140 colleges.
• Community colleges also play a key role in
the High-Growth Job Training and WIRED
initiatives.
• Resources and tools are available on
workforce3one.org.
 State Universities and Land
eta Grant Colleges

1st Gen. WIRED Regions

2nd Gen. WIRED Regions

3rd Gen. WIRED Regions

eta Looking Ahead!

• Transformation Forums in Fall 2007

• Helping Regions Transform
– Regional Innovation Grants (RIGs)
– BRAC Impacted Communities
– Economic Transformation
– Natural Disasters
• Strategic Response Activities
– Resources
– Technical Assistance
– Strategic Action Teams