Linking Economic and Workforce Development: A Regional Sector Approach Bob Sheets Business and Industry Services Northern Illinois University September, 2005

2 The Challenge for States How to link economic and workforce development to: Meet the needs of employers in key industry sectors (e.g., manufacturing, healthcare) driving state economic growth Expand access to economic opportunities to make sure no worker or community is left behind

3 The Challenge for States Creating a competitive environment for employers to achieve sustainable competitive advantages in: Sourcing, developing, utilizing, maintaining, and transitioning workers better, cheaper and faster than their global competitors Using strategies that result in expanded access to economic opportunity

4 In the context of…. Global economy with rapid technological change and shifts in business investment Reduced federal and state resources and long-term structural deficits Growing private sector presence in workforce development within a truly public-private “workforce development industry” Breakthrough information technology applications that have the potential to transform the industry

5 How Do We Respond? What should be the primary role and strategic approach of states? Public program/system manager--building public workforce development systems Strategic investor and catalyst in the industry--building public-private markets and supply chains/networks (pipelines)

6 Illinois Approach Regional Economies: One Size Does Not Fit All States are diverse mixtures of regional economies with different competitive opportunities and challenges in the global economy Regions require different economic development and workforce development strategies Industry Sectors: Focus on What Matters Regional economic development strategies should focus on key industry sectors that are expected to drive growth in the new global economy Examples: Healthcare, Manufacturing, Logistics and Transportation Public-Private Pipelines: Sustainable Solutions Leverage and integrate workforce and education resources (e.g., P-20 initiatives).

7 Defining Regions Ten geographic areas, known as Economic Development Regions (EDRs), designated by the Governor for economic development The regions are groups of counties with defined population centers and commuting patterns Economic development plans—Opportunity Returns plans—have been developed for each region.

8 Critical Skill Shortages Initiative (CSSI) Launched CSSI as part of Opportunity Returns Plans CSSI establishes LWIB-led coalitions to: Determine key industry sectors Determine size and distribution of shortages in critical occupations Determine root causes and solutions Develop proposals to pilot-test and implement solutions that leverage existing resources CSSI provides $3 million in planning grants to compete for $15 million for implementing solutions

9 Determining Key Industry Sectors LWIB-led consortia select major industry sectors that are creating good jobs and are targeted by economic development organizations within the regions Key sectors selected in the 10 regions: Healthcare Manufacturing Transportation and Logistics

10 Determining Size and Distribution of Shortages Targeted occupations must: represent strong employment demand; be critical to industry competitiveness; provide good earnings and benefits; and be appropriate for targeting by the system. Utilize both primary and secondary data Primary—Employer surveys, industry focus groups Secondary—Projections, enrollment/completion and follow-up data Getting consensus on shortages Size—How Big is the Shortage? (e.g., 100 or 200 nurses per year) Distribution--Where Are the Shortages Concentrated? (e.g., all hospitals and long-term care facilities or only rural hospitals)

11 Determining Causes of Shortages in the Pipeline Example: Nurses Employee Retention Working conditions, pay Career advancement opportunities Unrealistic expectations on work Graduate Placement Leaving region Not taking jobs in rural hospitals Program Capacity and Student Completion Childcare and financial support needs Finding qualified faculty Lack of clinical opportunities Building Program Applicant Pool Lack of career awareness Poor academic preparation

12 Developing Solutions Root CauseSolutions Traditional Nursing Students Do Not Take Jobs in Rural Facilities Expand enrollment of adult rural residents in programs Provide workplace-based upgrading programs for nursing aides in rural facilities Non-Traditional Students Lack Academic Preparation Adult bridge programs Healthcare K-12 programs with strong academic emphasis

13 Comprehensive Pipeline Solutions Retention of nurses in practice and recapturing of nurses not in practice Recruitment/placement into high need areas Expanding program enrollment/capacity and improving skills and completion rates Developing better pool of qualified youth and adult program applicants

14 Challenges and Issues Getting the Facts Straight ---Size and distribution of shortages vary widely even in occupations with widely reported national and state shortages such as nurses Doing More of the Same Thing Won’t Get Different Results--More training is not always the solution. Many of the major causes require different strategies, not just enrolling and placing more people Leveraging Existing Resources—Most solutions can be done by aligning and integrating existing public and private resources. Challenge is how to provide incentives for doing it and sustaining the effort Expanding Access---Need to make sure that solutions expand access to adults and youth facing major barriers including basic skills

15 Next Steps Improving integration of LMI and performance management systems to manage regional strategies to address short-term and long-term shortages Changing incumbent worker and training policies to provide more flexibility in developing workforce development solutions at the regional level Expanding the vision and scope of CSSI in address manufacturing and transportation and logistics and take the next step in healthcare Establishing innovation grants to promote continuous improvement of regional pipeline solutions