Analysis of the Key Elements of the Modern Workforce Development 

Workforce development has been a public-private sector partnership for over a century and though it has taken various forms, it has always been directly involved with the public school system. One of the earliest forms it took was in the way of training agreements. These were made between employers and schools to ensure that schools were pumping out capable workers for the workforce. In the early days of human resource development, this meant that schools were responsible to prepare the worker for the specific tasks that were needed in the workplace. An example of this would be learning how to type. Overtime, structural economic changes forced the old system to change. The economy was no longer heavily reliant on basic manufacturing and agriculture. The information, science, and service industry began to be the drivers of what is known as the new economy. While typing is still a fundamental part of many people's jobs, the skills needed today are more complex and requires extensive training.

This paper looks at the key themes of modern workforce development in the context of regional economic development or clusters. I found that regional economic clustering and regional workforce development go hand-in-hand. It is arguably the clearest theme that comes across in the work of all of the research I read. The goal of this paper is to clearly communicate why workforce development is important to regional economic development and present the cross-cutting themes and strategies brought up by researchers on this topic. I will conclude by reviewing barriers to regional collaboration along with how to succeed. Before diving straight into the details, it is important to elaborate on the heart of all of this, people.

Human capital is arguably the most valuable resource there is and therefore at the center of workforce development. There is not necessarily a limit on the capacity of workers abilities unless they or their employer chooses to limit them. This makes workforce development an opportunity. It is a “chance to unleash the creative, productive, and innovative forces, found only in people, for the economic and social betterment of our cities, states, and nations. People-centered development has the unique advantage of promising increased equity, efficiency and economic vitality”. Unfortunately, the American workforce is for the most part undertrained and not prepared for future opportunities. Nearly all of the fastest-growing jobs in the new economy will require postsecondary education and according to the U.S. Government Accountability Office, an increasing number of people come to the workplace without the basic skills expected of them. This lack of readiness is a challenge for employers as much as it is for job seekers. Many employers are not willing or able to find, accept, and support workers who come from completely different backgrounds. For too long, the U.S. has relied on the traditional economic and workforce development that focused on job and wealth creation instead of paying attention to actually developing the workforce.

With the rise of the new economy, also known as the knowledge-based economy, an advanced education past secondary is essential. This knowledge can be obtained from universities, community colleges, apprenticeships, vocational and technical institutions. They all play a pivotal role. There has been a long-term trend for employers to move away from providing training to their workers in-house. The role of community colleges, vocational and technical schools has become more important as a result. Another key aspect of the knowledge-based economy is that in the competitive age of globalization, it is not a national economy so much as it is a regional one.

Theory and Academic research shows that firms and regions benefit from clustering, which is why experts in economic development promote it. Clustering in a nutshell is when a group of firms, agencies, other economically related actors, and institutions, that are located near one another, draw productive advantages from their mutual proximity and connections. We see great examples of this regional economic development strategy in the Research Triangle Park (RTP), where many biotech companies are concentrated and rely on universities, community colleges, vocational and technical institutions for providing well-educated professionals to keep their businesses producing. This partnership prevents them from poaching qualified workers from each other, which happens in a market with not enough qualified labor. In fact, if you look at the regions of the country that have had the greatest economic booms in the past half century, you will find that nearly all of them have relied on planned economic development through partnerships between the government, business, and academic sectors.

The partnership between the three sectors makes up one of the major cross-cutting themes discussed by experts. When discussing the five traits of successful cluster initiatives, Donahue et al. argue that success is industry driven, university fueled, and government funded. Blakely and Leigh also point to how this three-way partnership has provided many benefits. Forced together through changes in the economy and federal regulations government resources and private resources are being used more effectively as trainers seek to ensure the service they provide is directly related to what the businesses really want and that the people they train can find jobs in the most promising firms. In turn, economic developers know that they need the academic sector to produce a top-quality workforce that meets the needs of businesses and attracts more like-minded businesses to the area. The partnership is one that feeds each other to grow but in order to work it has to be well organized and thought out.

Competition can prove to be a hard barrier for regional collaboration. If a cluster does not have a focus in workforce development there will inevitably be a shortage in qualified labor. Scare resources coupled with an infusion of new businesses vying for labor will lead to trouble. Or if the partnership breaks down in the form of government funding, similar problems can arise. An example would be a reduction in federal funding leading to support of workforce development collaboration requiring organizations with diverse missions and different aims engaged in obligatory partnerships as had happened in southwestern Pennsylvania. Such mandated partnerships have the capacity to erode formerly successful collaborations. An increase in actors, combined with little commitment to increase available government resources results in more actors vying for already limited resources. A lack of organization or starting without a goal can be equally challenging, and pose as a barrier.

Melendez et al. also point out that a fragmented governance can lead to issues. This is not hard to imagine since regional collaborations encompass a wide range of actors, combining multiple organizations, each with their own structures for accountability and governance. Not to mention their own interests. Donahue et al. makes a similar point that starting without a goal can lead to missed opportunities and repetitive mistakes like not identifying your clusters collective targets or changing them every five years. What is needed to prevent this fragmentation/disorganization is intermediaries.

Intermediaries serve as leadership or anchor organizations. One way to look at it is by being anchored by a physical center. In Donahue et al., four of the five cluster initiatives they profiled that were successful had a physical center where firms, academic researchers, and related enterprises could have face-to-face interactions on a daily basis and that served as a physical validation of an already existing cluster. This promotes knowledge sharing and has a secondary benefit of tying companies scattered around the cluster together. Universities can often serve well as a center. Going back to Melendez et al., they see Anchor organizations as a best practice for successful collaboration. Looking beyond a physical center, they see anchor organizations as single labor market intermediary organizations that serve as a core governance structure for the collaboration, often supported by the state and have the resource capacity to provide and maintain necessary communication channels. This allows for the multiple competing actors to organize in ways that adequately respond to the demands and needs of local economic climates. Effective leadership by anchor organizations enable the mitigation of diverse goals and interests, streamlining of policy services, and for the capacity to help sustain the collaboration despite a fragmented governance structure. I believe the importance of anchoring organizations leading to greater collaboration falls in-line with Giloth’s best practices of partnerships building connections to sectors and regions. Workforce pipelines, which he also described as bridges, improve the preparation and readiness of jobseekers with a focus on neighborhoods and specific populations. To come full circle, intermediaries serve as leadership to hold the partnership together in a more organized and structured way so that the balance of government, business, and academics stays in equilibrium. This will enable the qualified labor, trained in the way the businesses need, to continually serve the region at or near capacity. This is well illustrated in action in Garmise’s research of lessons from U.S. programs and Lowe’s studies on RTP.

Garmise’s argues that in a knowledge-based economy, economic prosperity is tied to having talented people in your pool of labor. Furthermore, from her research, she believes that increasing the overall pool of talented labor available is how regions can put their best foot forward. She cites Glaeser and Shapiro to make her point, “wealthier, more dynamic, regions generally do have more educated people”. The opposite goes for the poor regions of the U.S., they have less educated people in their pool of labor. Therefore understanding human capital formations is key to successful workforce development. You need to know what you are working with.

In-line with others opinions to this point, Garmise states the purpose of workforce development is to educate retrain, and place workers to meet the needs of regional economy. Looking at workforce development partnerships across the countries she made some key findings reinforce her argument. Above all, that intermediaries are key in building formal linkages (interchangeable with bridges or pipelines) that help better align supply and demand. Looking at one of her cases, Bread and Butter Cafe in Georgia, they trained the homeless population to fill the need for cooks in local restaurants. Going through all of her case studies she found that intermediaries enabled a high degree of engagement with other relevant area institutions. They are not single purpose organizations, instead they go beyond job matching to gain a wide range of services and bring together various offshoots of workforce development.

Looking at North Carolina, Lowe points out how the state successfully responded to the challenge of generating quality, stable jobs for a wide range of workers in the region by integrating workforce and economic development functions in an effort to anchor biotech manufacturing. He examined the pivotal role of the state’s workforce development system, particularly the network of community colleges. What he found was that the partnership between businesses, state and the schools created viable employment opportunities for the less educated workers who were displaced from the declining textiles and tobacco industries. This happened by first persuading existing manufacturing firms to help with industrial recruitment efforts and second, by working with firms to identify new areas for collective coordinated industrial action. The involvement of workforce development experts in the recruitment process helped fortify the quality of skills and training.

The case study of North Carolina’s life science industry is a primary example of proper workforce development. Pharmaceutical manufacturers seeking to expand partnered up with community colleges for assistance in creating a customized training program. With initial success, the North Carolina state government became involved, providing subsidized vocational training and assistance in recruiting and prescreening prospective employees. Overtime, the partnership created what was known as BioWork, a basic course covering techniques in bio manufacturing and good practice. Many companies were involved and ultimately benefited from the program. Other associate degree programs would emerge out of this consortium and continue the progress of the partnership.

North Carolina capitalized on anchoring biotech in RTP early on knowing that knowledge-intensive industries would be the driving factor in long-term economic prosperity. This is now beginning to spread to other regions in the state as well; however, the important thing to take away from the North Carolina biotech case study is that not all other places should duplicate the same structure. Instead, they should consider their strengths as mentioned earlier. Consider what might be gained from institutions partnering. Realize who all should be at the table and where your anchor is. Deciding what target industry(s) make the most sense for the cluster to target. These are all the points that were made in the research for this paper. Above all, what was reaffirmed to me in this project, was that partnerships have to work together, but with clear and predetermined goals. They must answer the above questions in order to work in equilibrium.