Stuart Andreason (photo by Odie Swanegan)
Atlanta Fed Community and Economic Development department senior advisor Stuart Andreason and Economy Matters staff writer Charles Davidson discuss why workforce development—training and education—matters, how it's changing, and why until recently it might not have meant much in the South.
CD: Why does the Fed care about workforce development?
SA: Employment is a key part of the Fed's dual mandate, so there's a clear tie-in with workforce development and full employment.
CD: Is it fair to say that the system that served us well for decades—you go to college and get a good job or finish high school and get a solid, middle-wage job—is broken? Or has the world evolved and left that behind?
SA: The system's no longer matching the way the economy works. One thing that's changed is the middle-skill jobs are not necessarily gone, but there's a new set of training needed. Workforce development can fill that gap. Previously, people who had been in jobs for a long time might get training when there was a big layoff—they would get help with some retooling and finding new jobs. But today, I think people have to be more proactive in developing skills early.
CD: Are there particular circumstances here in the South that affect workforce development? Historically, this region is not union-friendly, for example.
SA: I think unions are an important part of this. Does workforce development have to be done through a union? No. I think one of the things they represent is an ideal piece of the infrastructure to develop these programs. Other pieces of the infrastructure include technical colleges, nonprofits, and industry associations. I'm not sure if it's true, but one thing we hear is that in the South, for the last few decades, training people hasn't been as big of an issue because we can import who we need. In-migration has been huge. But in-migration really slowed down with the recession.
CD: Some European countries have systems where high school might be a blend of academics and vocational training. That seems to be pretty effective, right?
SA: In terms of the early-career stuff, Germany in particular has a much more built-out apprenticeship system than we do. There's a lot of interest in moving toward that to help move people—those who have been out of school for a while and people in the regular school system—into more technical careers. The new Workforce Innovation and Opportunity Act has increased the support for apprenticeships and on-the-job training, which is a hopeful move toward being a little more like some of those European models. But I don't know that either side—Europe or the United States—has it completely correct. So coming up with a system that's somewhere in between would really make some sense.
CD: What's standing in the way of us getting there?
SA: I think a big one is perceptions about a lot of the jobs. I heard a report from the Manufacturing Skills Institute about this interesting dynamic, basically: "We're going to bring 1,000 jobs to your community. What type of jobs do you want?" People are very supportive of saying, "Let's have 1,000 manufacturing jobs, those are great." But there's this weird "but not for me and not for my kid" syndrome.
CD: I want my kid to be a lawyer, doctor, engineer…
SA: Exactly. A lot of those manufacturing jobs pay a lot. I think part of it is perception about exactly what some of those jobs are like. They found the biggest barriers were: did people have the education and experience, like an internship, that would expose them to what those non-college-bound careers would be like. And then mom and dad were major factors. They tended to either encourage or discourage that. The question is, how do you get a system where people are able to move into those careers? And I think that comes down to understanding that there have to be more fluid boundaries between businesses, between traditional education, and between training programs.
CD: So those boundaries are too distinct?
SA: Yes. Policy-wise, it's about creating some fluidity, so if someone becomes interested in being an engineer but ends up not having the skills or technical aptitude or education to do that, then help them understand that there are a lot of allied professions associated with engineering. Or if someone has done really great work in construction but has other ideas, we want to make sure that they have the opportunities later to get training and move up to be, say, an engineer if they desire. That creates a need for more coordination. That underscores the need to understand training and education as a lifelong endeavor.
CD: As the economy improves, does the workforce development system or do individual groups shift from helping the unemployed find a job toward helping employed people hone their skills to get a better job?
SA: That's an increasingly large field. There are sector-based programs--partnerships between training programs and a certain industry. Some of the hospitals in the Atlanta area were having a hard time filling front-line nursing positions. They realized they had a lot of dependable workers who were good with patients, wanted to work, and always did a nice job. But they were essentially in the very entry-level jobs. The organizations said we know they possess a lot of the traits we need—the soft skills—but they don't have technical skills or education to move into these nursing-related positions. So they said, the soft skills are so important to us, we feel like it would be easier to work with these people to help move them up, get them the technical skills and then we can backfill those lower-level positions. It's not a massive number of people, but my understanding is that the program has largely worked.
CD: Is workforce development as a field of study relatively new?
SA: I wouldn't call it a new discipline. I would say that we are thinking about it differently, and it has started to receive an explosion of interest. For a long time, there have been people—largely in health and human services positions, and to a smaller extent antipoverty researchers—who have studied these programs. The multidisciplinary look at these issues has really expanded. In the last few years, I would say economists have really started to dig into the policy questions, and people like me who are interested in local economic development have really gotten interested. Human resources management academics have gotten interested in a way they've never really been. The Fed's specific interest in training and workforce development for low-income populations is new itself.
Charles Davidson
Staff writer for Economy Matters