financial stability focus area: family ... sustaining...employment never regaining its pre-recession...

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FINANCIAL STABILITY FOCUS AREA:FAMILY-SUSTAINING EMPLOYMENT

UnitedWay.org/income

GIVE. ADVOCATE. VOLUNTEER.

Financial Stability Focus Area: Family-Sustaining Employment

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UNDERSTANDING ThE PROBLEM

Family-sustaining employment is the foundation

of financial stability. In 2010, almost 26 percent

of working adults earned less than $25,000

annually, which is just above the poverty rate

for a family of four. Overall, 40 percent of all

households earned below 250 percent of the

federal poverty level.* These workers often

struggle to afford food, rent, childcare, and

transportation, with little left over for saving and

investing. Families must have a steady source of

income that covers the cost of basic necessities

before they can make long-term financial

decisions regarding savings and asset building.

Technological innovations that increase worker

productivity, combined with increased global

competition, have impacted a broad array of

industries from manufacturing to the service

sector. To remain competitive and restore the

vibrancy of the U.S. job market, current and future

workers must acquire and maintain stronger

educational skills and workforce competencies

as the pathway to creating long-term earning

potential. United Ways, acting as community

conveners, workforce “brokers”(pairing trained

employees with employers,) and repositories of

promising practices in workforce development,

are a critical component in strengthening the

competitiveness of U.S. workers and securing

the futures of families and communities.

Through education, training, and sector-based

strategies that connect skilled workers with

jobs in growing sectors including healthcare,

technology, green industries, and community

infrastructure, a wide range of workers

including lower-income, dislocated and

disadvantaged populations can obtain family-

sustaining employment that offers the potential

for career advancement.* Communities with a

stable, skilled workforce are more economically

competitive and have the potential to provide

improved opportunities for residents, attract

business and revitalize neighborhoods. This

brief summarizes some of the key causes of

America’s current workforce challenges and

outlines practical strategies that United Ways

and their communities can implement to create

and strengthen family-sustaining employment

opportunities.**

CASE For ACtion

* in United Way’s income Strategies and Approaches document released in 2009, the goal was set to “cut in half the number of lower-income working families who are financially unstable.” this brief touches on two other sub-populations including dislocated and disadvantaged workers who factor into the discussion of the current labor market challenges.

** United Way Worldwide defines family-sustaining employment as employment that pays a family-sustaining wage, offers benefits including paid sick leave, and offers career pathways that provide opportunities for wage and career advancement.


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UNDERSTANDING ThE U.S. LABOR MARkET

Understanding the recent history and outlook

of the U.S. labor market is critical to our

overall understanding of the challenges facing

workers, families and communities. The

recession of 2007–2009 had deep employment

impacts across all sectors of the economy.

The steepest declines in employment were in

construction (–19.8 percent) and manufacturing

(14.6 percent,) which saw their sharpest drops

in employment since 1945 totaling more than

4.2 million jobs.2 Losses in manufacturing

were especially steep among workers in the

automobile sector, which saw jobs fall by 35

percent between December 2007 and June 2009.

Even economic sectors that had traditionally

been more recession-resistant, such as retail

trade, services, leisure and hospitality, saw

historic levels of job cuts with more than 1.4

million jobs lost.3 Overall, the “Great Recession”

of 2007–2009 was nearly twice as deep and

twice as long as the 2000–2001 recession that

preceded it.4 National unemployment hit a high

of 10 percent in October 2009, and has very

slowly decreased each month since to a low of

8.3 percent in January and February 2012.5

If history since World War II is any guide, many

of these jobs, especially in manufacturing,

are unlikely to be regained. Since 1979

when manufacturing employment peaked at

almost 20 million, these jobs have been in

steady decline. Sharp falls in manufacturing

jobs accompany every recession with total

employment never regaining its pre-recession

level.6 There is significant disagreement about

why manufacturing employment continues to

fall. Some of the permanent reduction in these

types of well-paid, benefit-rich positions is due

to jobs shifting overseas to take advantage of

lower labor costs. The Economic Policy Institute

estimates that between 2001 and 2010, the

U.S.-China trade deficit has eliminated or

displaced nearly 2.8 million U.S. jobs of which

1.9 million were in manufacturing.7

Other economists argue that the most important

source of job loss in is the tremendous gains

American industries have made in worker

productivity. An examination of worker

productivity data supports this view. Total U.S.

economic production now exceeds its pre-

Great Recession levels at $15 trillion, despite

the fact that the economy shed over 7 million

jobs during the recession.8 Productivity rate

increases per hour worked doubled between

2008 and 2009 and then doubled again in

2010.9 Rising productivity, often cited as the

key to increasing living standards in the long-

term, reduces short-term labor demand through

improved efficiencies. In addition, since these

efficiencies typically involve the introduction

of new production technologies and systems,

rising productivity can also mean an increased

premium on workforce education and skill

levels leaving low- and middle-skill workers

with fewer employment opportunities.

Economists debate if skilled jobs in the middle

of the labor market – jobs that require some

post-secondary education but less than a

traditional four-year degree such technical jobs,

service jobs in health care, and installation/

maintenance/and repair occupations – are

shrinking or expanding.10 As with much else

relating to labor market analysis, the actual

blend of low-skill and mid-skill employment

is uncertain and depends on how researchers

classify specific occupations. Nonetheless,

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Case for Action

there is strong evidence to suggest that

demand for non-routine, middle-skilled jobs –

particularly in the health sector – is strong and

will remain so for at least the next decade.11

This finding relating to middle-skill jobs is

consistent with overall projections made by

the Bureau of Labor Statistics (BLS) forecasting

strong long-term job growth in the U.S. The

BLS estimates the U.S. labor force will grow by

about 15 million jobs by 2018 and that these

jobs will be significantly impacted by changes

in technology, consumer demand and other

factors.12 While manufacturing employment is

projected to lose another 1.2 million jobs by

2018, construction employment is forecasted

to grow by over 1.3 million. The health sector

(a prime example of non-routine middle-skill

employment) will add over 4 million jobs, while

a host of other sectors including education,

accommodation and food services, retail trade

and transportation, will add millions more.

Within the health sector, especially strong

growth is expected in home health, personal

and home care aides, dental hygienists and

other allied health professions.


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Individuals who seek family-sustaining

employment face many obstacles. Broadly

speaking, the United States workforce

development system is underfunded relative

to the goals it pursues. The system is

fragmented and often lacks connections to and

an understanding of labor market trends and

employer needs. Compounding the matter is a

lack of access to essential supports and services

that will help disconnected and disadvantaged

workers gain the necessary skills and training

to find employment. Understanding and

addressing these obstacles will be critical to

increasing the supply of family-sustaining jobs,

as well as providing individuals with the skills

and supports they need to succeed.

OBSTACLE 1: LACk OF ACCESS TO FAMILY-SUSTAINING EMPLOYMENT OPPORTUNITIES

As of February 2012, our nation faces a jobs gap

of 11.4 million jobs, 5.2 million from jobs lost

since 2007, and another 6.1 million jobs that

should have been created in the absence of the

recession.13 In addition, workers are isolated in

many communities – by a variety of education,

training, and geographic factors – from entry-

and mid-level employment opportunities

that are already available. One of the more

remarkable aspects of the labor market in the

recent recession is that acute labor shortages

persisted for a number of key industries

and occupations even in the context of high

unemployment rates. The BLS reported nearly

3.5 million job vacancies in January 2012 in the

midst of an 8.3 percent unemployment rate. It

should be noted that hires, total separations,

and employment all remained below pre-

recession levels.14 There is a skills-mismatch in

many states where there is a short-fall of trained

workers to fill middle-skilled jobs. Economic

Modeling Services Incorporated, a private labor

market forecaster, found that in March 2011,

there were more than 22,000 unfilled positions

in key California sectors, including energy,

information technology, and skilled crafts,

despite the state’s 12 percent unemployment

rate.15 This mismatch between market demand

and available worker skills strongly suggests

the need to better align education and training

systems to labor market and employer demand

projections.

At the same time, however, many communities

are caught in a human capital/economic

development “catch-22” in which they are

unable to attract industry due to unprepared

workers and unable to prepare workers due

to a lack of viable employment opportunities.

This conundrum can overwhelm even the

most sophisticated and well-intentioned

efforts to improve access to family sustaining

employment. A recent study by the Council

on Competitiveness, a Washington, D.C.,

nonprofit, found that the primary consideration

for employers in making decisions regarding

investment, expansion and location, was the

obStAClES to AChiEving FAmily-SUStAining EmploymEnt

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obstacles to Achieving Family-Sustaining Employment

presence of a growing and well-educated

workforce. Other factors, such as infrastructure,

economic development strategies, and tax and

regulatory environment were also important

but secondary to workforce and talent

considerations.16

The absence of economic opportunity has

another self-reinforcing aspect: declining worker

morale. Low-income workers who participated in

a 2003 Jobs for the Future (JFF) survey said that

there is a lack of job opportunities where they

live. In fact, a majority (67 percent) says that it

is an obstacle, while almost half (46 percent)

say that it is a major obstacle.17 Arguably, the

widespread perception that family-sustaining

employment is not available may discourage

some workers and youth from investing time,

energy and limited financial resources in

education, training, and apprenticeships,

and other entry- or mid-level employment as

part of a pathway to higher paying jobs and

family-sustaining employment. While the JFF

research has not been updated since 2003, its

fundamental conclusions about the relationship

between worker hopes and aspirations and

the perceived availability of family-sustaining

employment remains a significant consideration

for organizations and institutions seeking to

improve access to employment opportunities.

The psychological momentum for work is

a critical aspect of fostering a commitment

to education and training and an important

factor to be considered in overall workforce

development strategies.

OBSTACLE 2: LACk OF SOFT-, LIFE-, AND PERSONAL-EFFECTIVENESS SkILLS

A June 2008 study by the Society for Human

Resource Management and the Wall Street

Journal asked human resource professionals to

evaluate the change in importance of various

employee skills/practices since 2006. The

respondents said that the most important

skills for new entrants to the workforce were

adaptability/flexibility (46 percent) and critical

thinking/problem solving skills (35 percent),

followed by professionalism/work ethic (31

percent), information technology application

(30 percent), and teamwork/collaboration (26

percent).18 Another study conducted by the

American Society for Training and Development

identified a lack of communication and

interpersonal skills as common skills gaps

among current and prospective employees.19

Finally, James Heckman, a Nobel Prize-winning

economist at the University of Chicago,

highlights the importance of developing non-

cognitive skills (motivation, self-discipline,

and social skills) to educational and economic

performance in his influential book, Inequality

in America (2005).

OBSTACLE 3: NEED TO ACqUIRE ACADEMIC AND wORkPLACE COMPETENCIES

The benefits of education and workforce

preparation in terms of economic outcomes

are stark and getting starker over time. In

2010, workers with bachelor’s degrees made,

on average, $1,038 per week while those with

only a high school diploma averaged $626 per

week.20 In February 2012, the unemployment

rate for individuals over 25 who did not

complete high school was 12.9 percent, for

those with a high-school diploma it was 8.3

percent, for those with some college it was 7.3

percent, and for those with a bachelor’s degree

or higher it was 4.2 percent.21 Over a lifetime,

the Educational Testing Service estimates that

college graduates earn $2.7 million or about 96

percent more than high school graduates.22

Other statistical analyses bear out the


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relationship between low education levels and

the risk of poverty. As demonstrated in the

table below, low-wage workers make up about

23 percent of the American labor force and

more than half have only earned a high school

diploma, General Equivalency Degree (GED)

or less. That figure rises to 70 percent for low-

wage workers with children. In keeping with

this trend, fully two-thirds of the households

with children that live below 200 percent of the

federal poverty level are headed by low-wage

workers with less than a high school diploma.23

Narrow-casting of course curriculum (i.e.

excessive focus on narrow occupational skills

and inadequate attention to context-based

learning) and inconsistent eligibility standards

add to the challenge of helping lower-skilled

workers acquire academic and workplace

competencies. Most Adult Education programs

consider workforce readiness and career

preparation to be one of their many goals, but

classroom curricula reflect many other critical

skills, including basic literacy instruction and

preparation for the GED or other high school

equivalency examinations. Also, most programs

are not designed to help participants transition

to the higher levels of education and training

that are increasingly required for success in

today’s workplace.

Finally, obtaining assistance through the

Workforce Investment Act (WIA) system can be

especially difficult for under-skilled workers.

WIA performance metrics tend to drive resources

toward the most employable segments of the

population and serve as a functional disincentive

for serving individuals with multiple obstacles

to employment that require higher levels of

education, training and supportive services

CharaCteristiC

All workers 100.0 22.8 10.8 5.3

Educational attainmEnt

Less than high school 10.1 19.0* 27.7* 33.2*

High school diploma or GED 30.4 35.5* 36.9* 36.7*

More than high school 59.5 45.5* 35.4* 30.1*

agE (yEars)

18–29 27.0 39.1* 42.7* 39.8*

30–49 52.2 43.1* 44.7* 54.8

50–61 20.8 17.8* 12.6* 5.4*

racE or Ethnicity

White non-Hispanic 69.8 62.0* 50.4* 42.9*

Black non-Hispanic 11.2 12.7* 16.7* 18.5*

Hispanic 13.2 19.4* 27.2* 32.8*

Other 5.8 5.9* 5.7* 5.9

Work

Full-time, full-year 70.0 51.2* 49.8* 50.4*

Full-time, part-year 13.6 18.5* 22.9* 23.5*

Part-time, full-year 8.8 15.8* 13.8* 12.3*

Part-time, part-year 7.6 14.4* 13.6* 13.9*

Spouse works full-timeb 69.7 71.6* 53.2* 56.9*

hEalth insurancE

ESI from own employer 55.3 22.1* 21.0* 18.8*

Personal and Family Characteristics of Low-wage workers (percent)

all WorkersLow-wage Workersa

Low-wage workers below

200% of FPL

Low-wage workers below 200% of FPL, with children

in family

Source: Acs and Nichols (2007), using data from U.S. Census Bureau, March Current Population Survey, 2004. Reprinted with permission. The cutoff at $7.73 an hour was chosen because it represents roughly half of the average hourly wage at that time.Notes: FPL, family poverty line; GED, general education diploma; ESI, employer-sponsored insurance.Asterisks indicate percentages that are significantly different (at the 0.05 level) from those in the non-low-wage or non-low-income categories. a. Defined as those earning no more than $7.73 an hour in 2003.b. Data are percent of married workers.

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obstacles to Achieving Family-Sustaining Employment

to succeed in finding and retaining jobs. In

addition, “sequence of service” policies, which

require individuals to follow a prescribed order

of services when seeking assistance at local

WIA One-Stop Career Centers, may discourage

workers from capitalizing on existing skills and

advancing more rapidly.

OBSTACLE 4: LACk OF SECTOR-SPECIFIC SkILLS TRAINING

As discussed in Obstacle 1, one of the counter-

intuitive realities of current U.S. labor market

conditions is the mismatch between labor

market supply (i.e. worker skills) and business

and industry demand. In March 2011, the BLS

estimated there were approximately 3.1 million

openings across all sectors of the U.S. economy,

including 228,000 in manufacturing, 355,000

in leisure and hospitality and 471,000 in trade,

transportation, and utilities.24 Industry sectors,

such as utilities and advanced manufacturing,

continue to express concerns about the

inadequacy of labor supply to meet current

and future demand. The Center for Energy

Workforce Development’s most recent survey of

its membership estimated the need for 80,000

new skilled technicians, line workers, welders,

and pipefitters by 2015.25 According to the

2011 Manpower Talent Survey, 51 percent of

U.S. employers reported difficulty in filling job

openings, citing a shortage of applicants, lack

of experience, and a lack of technical skills.

The same survey reported that among the most

difficult positions to fill were skilled technicians,

trades workers and sales representatives.26

The federal and state governments have also

recognized the skill mismatch and have invested

heavily in new programs, such as the Trade

Adjustment Assistance and Community College

and Career Training and the H1-B Technical

Skills Training, which provide over $2.2 billion

over the next four years to expand access to

demand-driven technical skills training.

OBSTACLE 5: LACk OF SUPPORTS FOR ACqUISITION OF FAMILY-SUSTAINING EMPLOYMENT

Some of the most common causes of separation

from the workforce are factors outside of work,

like loss of childcare, lack of transportation, or

personal and family health care needs. These

same needs also create obstacles to enrolling

in or completing education and training. A study

conducted by the National Center for Education

Statistics compared the enrollment patterns

of traditional-aged students (under age 24)

with those of adult learners (over age 24) and

found that, “adult learners are less likely to be

continuously enrolled than traditional-aged

students.”27 Reasons included family and work

demands, amount of time out of school, the

lack of affordability, and goals that focused on

learning specific skills to advance in their jobs

rather than earning a bachelor’s degree.

Training costs are another important factor.

Jobs for the Future conducted a survey of low-

income workers to explore their opinions and

experiences regarding career advancement,

opportunities for education and job training,

and job search resources. When asked how

likely they were to take part in a training or

education program in the next two years, over

half (57 percent) of the participants responded

that they were likely to participate. However,

the survey showed that expense is the most

significant obstacle to participating in education

or training programs. Two-thirds (65 percent) of

those surveyed cited expense as an obstacle,

while over one-third (36 percent) cited cost as

a major obstacle.


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These promising strategies and approaches to

implementing them are grounded in successful

work in the field. They will help communities

pursue and achieve their family-sustaining

employment goals and are broad enough

to encompass the full range of lower-wage

workers. Put simply, local and regional economic

success requires community partners to

cultivate workers who “possess post-secondary

education credentials, technical skills, the

ability to learn rapidly, and an entrepreneurial

approach to work and career management.”28

This demands long-term, results-driven

collaboration among employers, educators, the

public workforce system, the nonprofit sector,

economic development agencies, organized

labor, and other community stakeholders.

STRATEGY 1: CREATE ACCESS TO FAMILY-SUSTAINING EMPLOYMENT

recruit new businesses and/or industries

to increase the supply of family-sustaining

jobs in a given community – Before engaging

businesses in economic development, it is

critical that United Ways fully understand local

labor market trends and become conversant

in economic and workforce development

information and terminology. Once acquired,

this knowledge base can be paired with the

detailed knowledge local United Ways already

have about the communities and populations

they serve and used to improve the alignment

between targeted industries, population

groups, and training and education programs.

United Ways cannot and should not seek to

become stand-alone experts in workforce,

education or economic development. Becoming

an effective player in workforce development

does, however, require that United Ways invest

in better understanding these subject matter

areas so that they can be viable partners in the

economic futures of their communities. Many

United Ways around the country have already

begun this important work. In May 2011,

United Way of Northern New Jersey convened 150

business, government officials and nonprofit

representatives to improve collaboration around

workforce preparation and development issues

with a special focus on high-growth sectors like

life sciences, advanced manufacturing, health

care and financial services.29

United Way of Massachusetts Bay and Merrimack

Valley (UWMB) has developed a comprehensive

strategy for understanding local labor markets

and linking this understanding to adult basic

education, labor market analysis, vocational

skills training, and other supportive strategies.30

UWMB understands that the most effective

“sustainable employment” organizations “show

employers how participating in a workforce

development initiative can increase their bottom

line,” which requires carefully selecting employer

partners, involving employers in program design

and delivery, managing expectations, and

creating network opportunities for employers to

meet and hire program participants.31

EvidEnCE-bASEd StrAtEgiES And ApproAChES


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United Way of Greater Los Angeles participates in

the Los Angeles Workforce Funder Collaborative

(LAWFC) that seeks to prepare workers for in-

demand occupations in healthcare, logistics and

building trades, while working in partnership

with the employers, educational institutions

and the WIA system to drive policy and systems

changes.32 The Greenville (South Carolina)

Collaborative for Workforce Development is

another multi-partner effort (comprised of

employers, educational institutions, nonprofit

organizations and the WIA system) helping

workers find jobs with good wages and career

ladders while addressing key labor market

shortages.33 These types of comprehensive

engagements with industry, education and

economic and workforce development partners

are essential to assuring that all segments

of local communities are “at the table” in the

effort to expand family-sustaining employment.

encourage entrepreneurship and small

business development capitalization and

development to increase the supply of jobs

that pay family-sustaining wages – According

to the U.S. Small Business Administration,

small firms have generated 64 percent of all

net new jobs over the past 15 years and employ

just over half of all private sector employees.34

To maintain and grow this important source of

family-sustaining employment, it is important

that communities encourage entrepreneurship

through self-employment resources and

opportunities to expand business equity. Small

Business Development Centers, SCORE and

One-Stop Career Centers are publicly-funded

entrepreneurship resources that are widely

available across the U.S. Project GATE (Growing

America Through Entrepreneurship), a joint

pilot project between the U.S. Department

of Labor and Small Business Administration,

found that a collaborative effort to increase self-

employment, including aggressive outreach

by public agencies, targeted referrals, and

free or low-cost self-employment services

for unemployed individuals, led to a higher

rate of business ownership among program

participants and concluded that, “self-

employment training programs are an effective

policy tool for assisting the unemployed.”35

United Ways across the country are also making

significant investments in microenterprise and

asset development programs that help support

business start-ups and expansions. Building on

the unique talents and abilities of its refugee

populations, the United Way of Summit County

(Ohio) Refugee Microenterprise Project offers

financial and technical resources to build small,

cooperative businesses in pottery, weaving,

sewing and agriculture.36 United Way of Greater

St. Louis supports a similar program to help

immigrant women through small, no-interest

loans for the creation of new businesses.37

Private sector approaches to encouraging

entrepreneurship are central as well, like

launching resident-franchise businesses that

help low-income individuals make the initial

investment in a franchise. For example, the

Little Caesar’s “Manage to Own” program

supports qualified managers who have the drive

but lack the resources to invest in franchises.38

Encouraging microenterprise is also shown to

help individuals overcome poverty. Data from

a 2008 Aspen Institute study showed that

poverty fell 60 percent among participants

taking part in microenterprise programs a year

following program entrance.39 Another way of

promoting self-employment is through worker-

owned cooperatives. The Urban Cooperative

Development Initiative is a national effort that

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Evidence-based Strategies and Approaches

focuses on demonstrating the effectiveness

of cooperative businesses in “building

wealth and ownership” for residents of urban

communities.40 Regardless of the strategy,

entrepreneurship is a multi-year commitment

for all parties, and United Ways can help in

the dissemination of promising practices and

create linkages between programs and people

that help expand entrepreneurial opportunity.

STRATEGY 2: PROVIDE ACCESS TO ExISTING FAMILY-SUSTAINING EMPLOYMENT IN TARGETED INDUSTRIES

support the use of workforce intermediaries

to connect education and training providers,

employers, and earners in lower-income

working families to better ensure that

completion of training leads to employment –

United Ways are uniquely positioned as funders

and conveners in their communities to support

“labor market intermediaries” (organizations

that help connect workers to education, training

and employers) that seek to improve access to

employment opportunities, particularly for low

or under-skilled workers. Tremendous benefit

can come from using intermediary organizations

to coordinate workforce development activities,

including centralizing information and

resources for target populations; coordinating

diverse workforce-related services and training

programs; streamlining the partnership-

building process; ensuring a continuum of

services throughout training, placement, and

retention; and consolidating planning activities

and overhead costs. Skillful intermediaries

can also help disadvantaged workers gain

access to better jobs, partly by reducing

discrimination and providing information to

employers as well as job placement assistance

to workers.41 For example, the Commonwealth

of Pennsylvania uses workforce intermediaries

to aggregate demand for training and to focus

it on developing skills and education required

by employers.42

Develop sector-based initiatives to connect

earners in lower-income working families with

the jobs that pay family-sustaining wages in

growing industries – Sector-based economic

development and employment strategies are

collaborative efforts to: 1) identify high growth

sectors in a given locality or geographic region;

and 2) align education, training, workforce

development and supportive services programs

in support of individuals seeking employment

in the identified growth sectors. These

collaborative programs provide training that

is tailored to employer needs in specific labor

markets. Sector-based strategies also develop

career ladder and lattice programs that provide

upward and lateral training pathways with

multiple points of entry for workers with diverse

career goals.43 The United Way of Central and

Northeastern Connecticut has invested in the

Workforce Solutions Collaborative of Metro

Hartford. This project seeks to align industry,

education, training and other workforce

development resources to high-growth sectors

in manufacturing, health care, energy and

utilities.44 Similar approaches are being used

by other United Ways around the country.

Another example of effective sector-focused

initiatives are the CVS/Caremark Pathways

to Pharmacy and Pathway to Retail Careers

programs, which are designed to meet the

company’s need for skilled employees and

the community’s need for employment

opportunities. Both programs offer adults

and youth in inner city and rural areas the

opportunity to explore pharmacy and retail

as career paths.45 Another sector initiative in


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Flint, Michigan, has successfully worked with

lower-skilled individuals, particularly minority

women, and helped them prepare for careers in

the health care industry.46 In addition, the Center

for Energy Workforce Development (CEWD) is

working with 8 consortia around the country

to implement an Energy Industry Competency

Model that helps workers progress through

competency tiers toward high-demand utility

sector jobs.47 Research shows that participants

in sector-focused workforce development

programs earn higher incomes and are more

likely to stay continuously employed in jobs

that offer benefits.48

STRATEGY 3: INCREASE ENROLLMENT IN AND COMPLETION OF DEGREE, CERTIFICATION, AND TRAINING PROGRAMS

Conduct outreach to increase enrollment in

available education, training, and occupational

programs – The first step to ensuring that lower-

skilled individuals have the skills necessary

to find and retain a family-sustaining job is to

provide them with information on the available

education and training options. Colleges, public

education, and public workforce systems engage

in private sector marketing strategies, such as

direct mail, telemarketing, or advertisements.

Another strategy would be to advertise and offer

support services (e.g., transportation, child

care, meals) in conjunction with recruitment

and program events.49 As part of its effort to

increase college attendance, the Kentucky

Council on Postsecondary Education began

the “Go Higher Kentucky” media campaign to

encourage Kentuckians of all ages to improve

their education, especially older students and

those not taking a traditional path from high

school to college. As a result, enrollment in

GED programs rose by over 7,000 adults, a 57

percent increase from the previous year – the

sixth largest increase in the country.50

Connect earners in lower-income working

families with affordable and effective basic

education, occupational training, and career

technical education programs to increase work-

related skills – In 2008, total funding for Adult

Education and Literacy programs in the U.S.

equaled approximately $2.1 billion, but was

only able to serve 3 million adults.51 However,

by linking career development resources

with lower-income workers, communities can

strengthen the personal effectiveness, reading,

math, critical thinking, and teamwork skills that

are essential for their workforces to penetrate

the labor market and gain family-sustaining

employment.

One promising strategy for connecting

families to education and training resources

is an innovative project funded by the U.S.

Department of Labor to create “access points”

inside community-based organizations to

expand the reach of the publicly funded

workforce development system. Piloted by the

United Way of Brevard County, the WIA system

now has “access points,” online services in

local libraries or community and faith-based

organizations, which provide a computer and

volunteer to help lead individuals through

the One-Stop’s web-based tools and training

options.52 This approach helps break down

geographic and psychological obstacles to

service for populations that could otherwise be

reluctant to access government services.

Research also indicates that individuals participating in occupational training and career technical skills-training programs often gain access to higher-quality jobs.53 Other studies and evaluations show that career pathway projects that bring together employers, educators, and other community stakeholders can result in increased high school graduation rates, more successful transitions

13


from secondary to post-secondary education or training, students making more informed career decisions, employers accessing a larger pool of qualified workers, and students earning higher scores on standardized tests.54 A rigorous evaluation of Career Academies found earning increases for youth, and especially at-risk or disconnected young males, for at least four years after they graduated from high school.55 Many United Ways support adult education programs designed to improve individual and family literacy. The United Way of the Midlands (South Carolina) funds a variety of literacy programs including the Alston Wilkes Society, the Newberry County Literacy Council and Volunteers of America, all of which focus on improving literacy among adults.56

Remove obstacles to participation in education and training programs – It is often very difficult for lower-income individuals and families to manage their personal lives and work schedules, in addition to participating in education or training programs. Often parents will prioritize the needs of their children (due to a lack of viable childcare options) over attending a class. To maximize access to essential education and training credentials, effective career pathway initiatives must be tailored to match the unique needs of the specific target populations. Multiple program entry points, flexible scheduling (e.g., evening and weekend classes), support services (e.g., child care, transportation subsidies and micro-grant programs), sequencing of education and


14

training, and strong employer involvement ease the demands on participants’ time and increase the likelihood of a successful outcome.57 An evaluation of the Annie E. Casey Foundation’s Center for Working Families concept showed that clients who received “bundled” services (i.e., employment, benefits and work supports, financial counseling) were three or four times more likely to achieve a major economic outcome (e.g., vocational certification), while clients who received high-intensity bundled services (e.g., intensive support services) were five times more likely to achieve a major economic outcome.58

It is important to keep in mind that programs that remove education and training obstacles benefit businesses and industries as well. Employers like Northrup Grumman, CVS/Caremark and many others see the value in reducing turnover and increasing their industry competitiveness by offering better training for entry-level employees and opportunities

to advance in their careers within those companies or industries. Innovative recruiting and training programs for entry-level employees are shown to result in higher revenue and pay, lower overall costs, less time wasted, reduced turnover, better customer satisfaction and more motivated and productive workers.59

STRATEGY 4: PROVIDE SUPPORTS TO hELP INDIVIDUALS OBTAIN AND RETAIN EMPLOYMENT AND ADVANCE ThEIR CAREERSRemove obstacles to finding and retaining employment – Some of the most common causes of separation from the workforce for lower-income individuals are factors outside of work, like loss of childcare, lack of transportation, or personal and family health care needs. United Ways can play a lead role in promoting public and private work supports among employers that help increase job retention and reduce the high costs associated with employee turnover. These supports can include career and financial counseling, transportation, childcare

15

subsidies, case management, help with providing health care to family members, and micro-grants for meeting unexpected financial hardships. The United Way of Massachusetts Bay and Merrimack Valley (UWMB) has developed an effective framework for achieving “sustainable employment” that starts with soft-skills development as part of its Adult Basic Education (ABE) program.60 ABE best practices include instruction in technology and computer orientation, time management, appropriate dress and decorum, leadership development, resume writing, interview practice, financial literacy, health and wellness, and community involvement. Importantly, ABE emphasizes the need to integrate soft- or life-skills throughout training and early employment. Like UWMB, United Ways are well suited to identify the most pressing life-skills gaps and coordinate the various community-based service providers that are experts at preparing lower-income individuals to get the most out of education, training, and employment programs.

Another example of a successful model for assisting disadvantaged workers is the Employer Resource Network (ERN) in Western Michigan.61 ERN is a consortium of 45 small- and mid-sized businesses in four counties that pool resources to provide short-term case management, job retention services, work supports, and training opportunities to all network employees. ERN-related services are provided through strong employer partnerships with local social service agencies, WIA agencies, chambers of commerce, and community and technical colleges. The Western Michigan ERN shows that successful business-community partnerships benefit the employers’ bottom lines, help workers access the support they need to stay employed and build job skills, expand community college enrollment and grant opportunities, and create new ties between the business community and public and non-profit agencies.

Promote tax credits and incentives for both employers and employees – The federal government and many states offer the earned income tax credit (EITC), which raises incentives for low-wage workers to accept and keep jobs. This type of incentive may boost annual earnings and invite greater wage growth over time by keeping workers in their jobs. The State of California has a work opportunity program that promotes the hiring of designated, qualified individuals for which the business may claim a tax credit for each employee hired. The federal Work Opportunity Tax Credit provides a similar subsidy to business for hiring high-need populations that can help defray training expenses. In addition, federal education tax credits exist to help adults and youth offset the costs of education. The American Opportunity and Lifetime Learning Credits can be fully deducted from personal federal income taxes and serve as a powerful incentive for more personal investment in education and training.62

Connect earners in lower-income working families to career counseling to help them create a career “pathway” or “ladder” – Career ladder, lattice, or pathway programs help individuals visualize their career-related job opportunities and provide courses and curricula connected to various jobs within a career track.63 In Arkansas, a collaborative initiative is designed to help workers pursue articulated career pathways in six areas: business, various industrial skills, welding, early childhood development, emergency medical technology, and nursing. The Denver Community College Essential Skills Program assigns a case manager who works with individuals for as long as they are in the program and during the first year of their employment. Job-placement assistance and social supports for work through some programs clearly raised participant earnings in an experimental evaluation.



16

17

The broad picture of the U.S. labor market

shows a situation where growing numbers of

workers remain in low wage jobs and where

millions more disconnect from work entirely

because of poor earning prospects. At the same

time, employers continue to have difficulty

filling workforce needs due to a shortage of

in-demand skills among workers. This gap

between current and future workforce needs

and the skills deficit of the workforce is one of

the main problems facing the U.S. economy and

the primary challenge in helping workers secure

family-sustaining employment. It is also the

point at which United Ways can most effectively

focus their time, energy and resources as

problem solvers for employers and workers. The

research is clear that to advance their prospects

and obtain family-sustaining employment,

lower-income workers need at least some

postsecondary training (or retraining) and

relevant work experience. Education and

training opportunities, targeted to specific, in-

demand occupations, need to be combined with

financial supports and incentives for workers,

as well as services that will reduce employment

obstacles and address critical ancillary needs.

United Way Worldwide and local United Ways

are a critical link in the economic development,

education, workforce development and workforce

support eco-system. Here are a few ways local

United Ways can help to serve their communities

in creating more effective workforce development

systems and guide individuals and families

toward economic self-sufficiency:

UNITED wAYS AS kNOwLEDGE BROkERS

United Ways can occupy a unique position

in the “dual-customer” (i.e., employers and

workers) world of workforce development.

Decades of service and intimate engagement

with local communities give local United Ways

an unparalleled understanding of the history

and current condition of the individuals and

families that make up local neighborhoods.

This nuanced and textured understanding

of the attributes, assets and obstacles of

different segments of local communities is

vital information in helping to guide the design

and implementation of workforce development

programs. By supplementing this community

knowledge with a robust understanding of the

skill needs of existing employers and those the

community is seeking to attract, United Ways

can be critical players developing training and

workforce systems that meet the needs of both

workers and industry.

UNITED wAYS AS COMMUNITY CONVENERS

The education, training, workforce and

economic development conversation needs a

focal point that can integrate all perspectives

into a single conversation. United Ways are

uniquely positioned to help convene and

manage this complex conversation and assure

that all elements of the community have a voice.

This convening role has two very important

components. First is the role of the United Way

in identifying, training and supporting nonprofit

leadership across various service domains.

Local United Ways can help to bring key

thE WAy ForWArd

18


community leadership into economic and

workforce development and, in doing so,

improve public understanding of goals and

objectives as well as increase “buy-in” within

the community for new investment and

development. Second, most United Ways

already have significant business and industry

participation on their local boards and in

fundraising, volunteer development and service

campaigns. These established relationships

of trust are critical to helping bridge diverse

communities and foster dialog between the

for-profit, government and non-governmental

sectors and help navigate among stakeholders

to improve and reform education, training and

workforce development programs.

United Ways as advocates for empoWering commUnities and strengthening families

United Way Worldwide has undertaken to

improve understanding within Congress and

the current Administration about the need

to “get smarter” in creating coordinated

approaches to improving outcomes for lower-

income individuals and families. In testimony

submitted to the U.S. Senate Committee

on Health, Education, Labor and Pensions

Committee, United Way Worldwide and eight

local United Ways outlined a conceptual

framework for empowering local leadership to

de-silo social services delivery and increase

resources to communities that design and

implement successful strategies for improving

social and economic outcomes. This kind of

advocacy at the federal, state and local level can

help provide local communities with the policy

tools and programmatic resources needed

to identify and address the needs of families

and communities in meaningful and impactful

ways. Local United Ways can replicate these

efforts through their elected representatives at

the state and federal level to improve service

coordination as a primary means of improving

outcomes for communities.

19

EndnotES

1 “income, poverty, and health insurance Coverage in the U.S.: 2010.” U.S. Census bureau, September 2011. http://www.census.gov/prod/2011pubs/

p60-239.pdf2 goodman, Christopher J. and Steven m. mance. “Employment loss and the

2007-09 recession: An overview.” Monthly Labor Review, bureau of labor Statistics, April 2011. http://www.bls.gov/opub/mlr/2011/04/art1full.pdf

3 ibid.4 ibid.5 “labor Force Statistics from the Current population Survey.” bureau of labor

Statistics, data extracted march 21, 2012. http://data.bls.gov/timeseries/lnS14000000

6 barker, megan m. “manufacturing employment hard hit during the 2007-09 recession.” Monthly Labor Review, bureau of labor Statistics, April 2011. http://www.bls.gov/opub/mlr/2011/04/art5full.pdf

7 Scott, robert E. growing U.S. trade deficit with China Cost 2.8 million jobs between 2001 and 2010. September 20, 2011. http://www.epi.org/publication/growing-trade-deficit-china-cost-2-8-million/

8 “national income and product Accounts gross domestic product, 4th quarter 2011 and annual 2011 (second estimate).” bureau of Economic Analysis, U.S. department of Commerce, February 29, 2012. http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

9 “labour productivity Annual growth rate.” organisation for Economic Cooperation and development, http://stats.oecd.org/index.aspx?datasetCode=pdygth

10 holzer, harry J. “is the middle of the U.S. Job market really disappearing? A Comment on the ‘polarization’ hypothesis.” Center for American progress. may 11, 2010. http://www.americanprogress.org/issues/2010/05/middle_job_market.html

11 holzer, harry J. and robert i. lerman. “the Future of middle-Skilled Jobs.” brookings institution. February 2009. http://www.brookings.edu/papers/2009/02_middle_skill_jobs_holzer.aspx

12 “occupational outlook handbook, 2010-11.” bureau of labor Statistics. http://www.bls.gov/oco/

13 greenstone, michael and Adam looney. “Understanding the ‘Jobs gap’ and What it Says About America’s Evolving Workforce,” Up Front Blog, brookings institution. http://www.brookings.edu/opinions/2012/0309_jobs_greenstone_looney.aspx

14 “Job openings and labor turnover Survey highlights January 2012,” bureau of labor Statistics, march 13, 2012. http://www.bls.gov/web/jolts/jlt_labstatgraphs.pdf

15 Special analysis prepared by EmSi for San mateo Community College http://www.smccd.edu/factbook/imgfile/43-top20jobs-bay%20area%202010.pdf

16 Kempner, randall. “the talent imperative for older industrial Areas,” Retooling for Growth: Building a 21st Century Economy in America’s Older Industrial Areas. Columbia University, 2008.

17 Getting Ahead: A Survey of Low-Wage Workers on Opportunities for Advancement. (boston, mA: Jobs for the Future, 2003). http://www.jff.org/publications/workforce/getting-ahead-survey-low-wage-workers-op/244

18 “Critical Skills needed and resources for the Changing Workforce: Keeping Skills Competitive.” Society for human resource professionals and Wall Street Journal Career Journal, June 2008. http://www.shrm.org/research/SurveyFindings/Articles/documents/Critical%20Skills%20needs%20and%20resources%20for%20the%20Changing%20Workforce%20Survey%20report.pdf

19 Bridging the Skills Gap: How the Skills Shortage Threatens Growth and Competitiveness…and What to do About it. (Alexandria, vA: American Society for training & development, Fall 2006).

20 “Employment projections.” bureau of labor Statistics, may 4, 2011. http://www.bls.gov/emp/ep_chart_001.htm

21 “Economic news release.” bureau of labor Statistics, march 9, 2012. http://www.bls.gov/news.release/empsit.t04.htm

22 Kempner, randall. “the talent imperative for older industrial Areas,” Retooling for Growth: Building a 21st Century Economy in America’s Older Industrial Areas. Columbia University, 2008.

23 http://www.urban.org/url.cfm?id=411532 24 “Job openings and labor turnover Survey, January 2012.” bureau of labor

Statistics, march 13, 2012. http://www.bls.gov/web/jolts/jlt_labstatgraphs.pdf

25 “gaps in the Energy Sector Workforce pipeline, 2009 Survey results.” Center for Energy Workforce development, 2009. http://www.cewd.org/mem_resources/2009 percent20Survey percent20Exec percent20Summary.pdf

26 “2010 talent Shortage Survey results.” the manpower group, may 2011. http://files.shareholder.com/downloads/mAn/1266555322x0x469531/7f71c882-c104-449b-9642-af56b66c1e6d/2011_talent_Shortage_Survey_US.pdf

27 Klein-Collins, rebecca. “building blocks for building Skills: An inventory of Adult learning models and innovations.” Council for Adult & Experiential learning (CAEl), 2006.

28 Jenkins, davis and Christopher Spence. “the Career pathways how-to guide.” Workforce Strategy Center. october 2006.

29 http://uwnnj.org/documents/poF_pressrelease11.pdf 30 “the road to opportunity.” United Way of massachusetts bay & the merrimack

valley, 2007. http://supportunitedway.org/files/the-road-to-opportunity_0.pdf31 ibid.32 los Angeles Workforce Funders Collaborative, Web. http://www.

laworkforcefunders.org/programs/functions.php33 greenville Collaborative for Workforce development (gCWd), United Way of

greenville County, Web.

http://www.unitedwaygc.org/workforce-development-partnership.php 34 “Frequently Asked Questions.” U.S. Small business Administration. http://

www.sba.gov/sites/default/files/sbfaq.pdf35 benus, Jacob. “growing America through Entrepreneurship: Final Evaluation of

project gAtE.” impAQ international, llC. december 2009.36 “refuge micro-Enterprise project.” Asian Services in Action, inc. http://www.

asiainc-ohio.org/programs/self-sufficiency/refugee-microenterprise-project/ 37 “our mission: helping people.” United Way of greater St. louis. Web. http://

www.stl.unitedway.org/templates/uw_whoweare.aspx?id=10952 38 Eryn gable. “Sub-Urban: blimpie aims to turn major cities into hubs for subs.”

Entrepreneur, may 2001. http://www.entrepreneur.com/article/3978439 “microentrepreneurs and their businesses: 2008 microtest

outcome.”Microtest, issue 2, march 2009. http://fieldus.org/microtest/mtoutcomes08FactSheet.pdf

40 national Cooperative business Association. Web. http://www.ncba.coop/

20

41 heath prince and Jerry rubin. “building new labor market institutions: State policies that Support Workforce intermediaries.” Investing in Workforce Intermediaries (Casey Foundation and Ford Foundation, november 2006).

42 James Kemple, with Judith Scott-Clayton. Career Academies: Impacts on Labor Market Outcomes and Educational Attainment. (new york, ny: mdrC, 2004).

43 prosio, tony. “From hidden Costs to high returns: Unlocking the potential of the lower-Wage Workforce.” Insight Center for Community Economic Development. Summer 2010.

44 “Workforce Solutions Collaborative of metro hartford Shares in honor from Council on Foundations.” United Way of Central and northeastern Connecticut. http://www.unitedwayinc.org/post/workforce-solutions-collaborative-metro-hartford-shares-honor-council-foundations-0

45 “recruiting and training through public Workforce System produces Strong roi CvS Caremark” Web. www.cvworkingfamilies.org/system/files/CvS+micro-case+Final.pdf

46 maureen Conway, Amy blair, Steven l. dawson and linda dworak-muñoz. “Sectoral Strategies for low-income Workers: lessons from the Field” (Washington, dC: Aspen institute, Summer 2007). http://www.sectorstrategies.org/sites/all/files/Sectoral%20Strategies%20for%20low%20income%20Workers.pdf

47 “Energy industry Competency model: generation, transmission, and distribution.” Center for Energy Workforce development. Web. http://www.cewd.org/documents/energymodel.pdf

48 maguire, Sheila, Joshua Freely, Carol Clymer, maureen Conway and deena Schwartz. “tuning in to local labor markets: Findings From the Sectoral Employment impact Study.” private/public ventures. July 2010.

49 Susan galonka and lisa matus-grossman. Opening Doors: Expanding Educational Opportunities for Low-Income Workers. (new york, ny: manpower demonstration research Corporation, may, 2001).

50 www.cpe.ky.gov/51 Background and Supporting Evidence for Adult Education for Work. (national

Center on Education and the Economy, 2009).52 bridging the gap: meeting the Challenge of Universal Access through Faith-

based partnerships. U.S. department of labor, Center for Faith-based and Community initiatives. www.virtualcap.org/downloads/mi/mi_EtCS_Access_points_bridging_the_gap.pdf

53 Anne roder with Carol Clymer and laura Wyckoff. Targeting Industries, Training Workers and Improving Opportunities ((new york, ny: public/private ventures, 2008). http://www.ppv.org/ppv/publications/assets/263_publication.pdf

54 institute for a Competitive Workforce and the national Career pathways network. “thriving in Challenging times: Connecting Education to Economic development through Career pathways.” october 2009.

55 James Kemple, with Judith Scott-Clayton. Career Academies: Impacts on Labor Market Outcomes and Educational Attainment. (new york, ny: mdrC, 2004).

56 “our Work in Education.” United Way of the midlands. Web. http://www.uway.org/our_work_community_impact/education/

57 baider, Allegra, vickie Choitz, Amy Ellen duke-benfield, marcie W.m. Foster, linda harris, Elizabeth lower-basch, neil ridley, Julie Strawn. “Funding Career pathways and Career pathway bridges: A Federal policy toolkit for States.” Center for law and Social policy (ClASp). may 2010. http://www.clasp.org/admin/site/publications/files/FundingCareerpathwaysFederalpolicytoolkitforStates.pdf

58 “An integrated Approach to Fostering Family Economic Success: how three model Sites are implementing the Center for Working Families Approach.” Center for Working Families, Annie E. Casey Foundation, 2010. http://www.aecf.org/KnowledgeCenter/publications.aspx?pubguid=%7bF0C4C227-E25E-4b20-A005-0dE98C2FA82C%7d

59 proscio, tony. “From hidden Costs to high returns: Unlocking the potential of the lower-Wage Workforce.” insight Center for Community Economic development. Summer 2010. http://www.insightcced.org/uploads/publications/wd/hiddenCosts-highreturns.pdf

60 “the road to opportunity.” United Way of massachusetts bay & the merrimack valley, 2007. http://supportunitedway.org/files/the-road-to-opportunity_0.pdf

61 derr, michelle and pamela holcomb. “Employer resource networks.” issue brief, mathematica policy research, June 2010. www.westmichiganteam.org/images/wired_brief1.pdf

62 “American opportunity tax Credit.” internal revenue Service, november 9, 2011. http://www.irs.gov/newsroom/article/0,,id=205674,00.html

63 “Career ladders and lattices.”o*net resource Center. www.onetcenter.org/ladders.html


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