More than 48 million Americans have filed new unemployment claims in the last 16 weeks, and states are projected to lose at least $200 billion in revenue, according to estimates from financial services company Moody’s. For the foreseeable future, states will struggle with competing priorities and significant budget cuts as they attempt to balance their budgets.
However, as states reopen and plan to do more with less, states should take this time to develop workforce strategies that build on the progress they were making prior to COVID-19, to accelerate their recovery and to ensure they are building the workforce necessary to compete once the pandemic is under control. States without a robust workforce plan will not only jeopardize their progress, but unintentionally obstruct their recovery.
States without a robust workforce plan will not only jeopardize their progress, but unintentionally obstruct their recovery.
It was not that long ago when public and private businesses were clamoring to find workers to fill the many job openings that were going unfilled. In October, “Help Wanted: Too Many Jobs and Not Enough Workers in Most States” highlighted a Stateline analysis of BLS data that concluded that there were more jobs than people looking in 39 states. A plethora of similar articles and publications were published between 2018 and early 2020 on the challenge the U.S. was facing given the tight labor market and the need to improve workforce development programs and bring more individuals into the job market.
Given the sharp increase in unemployment, there are clear strategies that states should begin to formalize and prioritize for a post-COVID-19 era to enhance their recovery efforts and to prevent exacerbating existing labor market inequities.
Here are five workforce development strategies for a post-COVID era.
Re-examine Regional Labor Market Information
States should immediately begin to re-examine the labor market data they have been citing from the past few years. Much of it is built on historical data sets that emphasize a past economy drastically different from 2020. COVID-19 has disrupted those patterns in ways that alter local and regional economies.
Economists and staff from state labor agencies, workforce boards, and economic development organizations would benefit from conducting new labor market analyses to understand the types of jobs that were lost from April to July, the regions most impacted by job losses, and the skills and credentials being required for current job openings.
States must reconsider the in-demand occupations and continue to reassess them over the next several months to inform policymakers, workforce boards, and education training programs. While many industries are negatively impacted by COVID-19, there are industries that are still hiring. There are also new industries and occupations emerging both as a result of COVID-19 and the private sector innovations that states need to ensure individuals are prepared to get individuals back to work.
States should analyze their labor market information with equity in mind. Beyond COVID-19, the country is wrestling with racial tensions that are exacerbated by inequities in our economic system. For example, while unemployment is at an all-time high for all demographics, it is consistently higher for Black and LatinX families which are disproportionately represented in industries most impacted by COVID-19. Unfortunately, even when education attainment is taken into account, Black workers are more likely to be unemployed and have lower wages.
By disaggregating labor market information and assessing patterns of various demographics, states can provide a more nuanced picture of where they are and what they need to do moving forward. States might also continue to keep track of labor force participation rates by age groups and assess dynamics between various age groups and special populations, such as individuals with disabilities and the re-entry population.
Prior to the recession, states were making significant progress targeting hard-to-reach populations because of a tighter labor market. States cannot lose sight of those priorities due to COVID-19; otherwise they will extend workforce inequities.
Evaluate Programs and Practices
Perhaps, one of the most overlooked strategies in the public sector is research and evaluation. As states face hundreds of billions of dollars in lost revenue, they are preparing to make significant budget cuts. Evaluating job training providers, programs, and practices is critical so programs that are effective at solving important problems are not the ones that are cut and programs without evidence of success beyond anecdotes are the ones sustained.
Research and evaluation can also help inform where scarce resources should be invested. For example, as states start cutting budgets, it would be helpful to know which organizations or programs across the state are the most effective at getting out-of-school youth to work, getting adults to sustainable wages, or incorporating two-generation approaches with higher returns on investments. Then, cuts and investments can be prioritized, and we can share best practices with other organizations and programs to improve programs more broadly.
Cutting effective programs will do more damage than good and will hamper progress. Scaling effective practices to improve outcomes is impossible without rigorous evaluations to identify effectiveness. Fortunately, the federal Workforce Innovation and Opportunity Act (WIOA) allows and calls for program evaluation. States can use this opportunity to do so.
Coordinate a Two-generation Approach
A two-generation approach considers the need of the parent and child holistically. Solutions are not isolated to simply helping a parent get a job. Rather, solutions are built around a framework that considers whether or not a child has access to services such as childcare or high-quality early childhood education. It also takes into consideration other barriers, such as a parent’s health and well-being, that could impact one’s success in a job.
As outlined in Ascend from the Aspen Institute, a two-generation approach includes postsecondary education and employment pathways, early childhood education and development, economic assets, health and well-being, and social capital. In practice, that can mean comprehensive intake processes for job-seekers, streamlined referral systems, and the scaling of two-gen services such as The Harbor in Clark County, NV which provides services and a safe place for youth and young adults. A two-generation approach will prevent fragmented and short-lived solutions.
Monitor Underemployment and Consider Work-based Learning
It’s important for states to consider young adults and recent college graduates in solutions and monitor underemployment. Even before COVID-19, underemployment—which considers individuals working part-time involuntarily or in positions where they are overqualified—was a serious issue.
Attaining a college degree is not sufficient to prevent underemployment. A study by Burning Glass Technologies in 2018 found that 43 percent of recent college grads were underemployed. Most surprisingly (and sadly), roughly two-thirds were still underemployed 10 years later.
Secondary and postsecondary institutions should continue to ensure students are aware of the careers they want to pursue, the education requirements of those careers, the expected salaries, and the experiences they need to enter those careers. This is why the many forms of work-based learning such as internships—and more rigorous forms of work-based learning, such as apprenticeships—are crucial in all high-demand industries.
State strategies must focus on expanding work-based learning to ensure young adults are acquiring useful skills. As a student once told me, “how can we get experience if every job we apply to requires experience?”
Monitoring underemployment and continuing work-based learning programs will be critical in states’ workforce recovery plans.
Develop Incumbent Worker Training Programs for Reskilling and Upskilling
Incumbent worker training programs support employers directly by allowing them to upgrade the skills of their employees and prevent layoffs. Incumbent worker training is also supported by WIOA and is a great opportunity to improve a state’s workforce, particularly for individuals who have the potential to be underemployed.
As states begin to recover from COVID-19, businesses will need tangible solutions to re-skill and upskill workers lacking job competencies as a result of emerging technologies. Further, an incumbent worker training program also positions individuals who may eventually be laid off to acquire the necessary education and skills needed to not only prevent layoffs, but transition into better paying jobs.
Successful incumbent worker training programs are flexible and employer-driven. Ensuring employers and employees leverage incumbent worker training programs is a critical re-skilling and upskilling strategy.
The pandemic will eventually be under control and states will need to be prepared to operate at maximum capacity as soon as certain restrictive guidelines are lifted. While states need to keep COVID-19 in mind, they should avoid the temptations of being paralyzed by the current situation and overlook planning for post-COVID-19 and the potential successes that will appear with proper preparation. State leaders, policymakers, and workforce professionals must use this time wisely.
Manny Lamarre is a Senior Program Associate at WestEd where he leads and supports initiatives that strengthen workforce and education improvement that leads to economic mobility for youth and adults. Lamarre formerly served as the Founding Executive Director of the Nevada Governor’s Office of Workforce Innovation and the Governor’s Designee on the Governor’s Workforce Development Board, leading and supporting the implementation of the state’s workforce vision and policies.