How to waste human capital

photo by Eric Norris

“Which is why we have to pass all these policies before we kill ourselves.” That was member Tony Marmo’s vivid but not inaccurate explanation Monday, May 18, of impending organizational changes in the Ulster County Workforce Investment Board. Local WIBs are expected to finish the job of reconstituting their organizations to conform to new federal legislation by June 30 and then dissolve. County executive Mike Hein will then appoint the members of a new, more compact WIB for Ulster County.

A final meeting of the present incarnation of the WIB has been scheduled for Monday, June 15 at 3:30 p.m. at the Business Resource Center on Ulster Avenue. The local WIB website indicated a present membership of 29 persons, about three-quarters of whom showed up.

Upon entrance, members picked up placards with their names on them and placed them in front of them, sort of like happens at the United Nations or on speakers’ panels. At the May 18 afternoon meeting, 25 persons arranged themselves in seats behind a large rectangle of movable tables while another five sat behind their tables directly in back of one of the rows of seated members. The waste of human capital these meetings represent is symbolic of the colossal waste in the system they administer.

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Last week, discussion centered on fulfillment of federal and state regulations, as it does at most WIB meetings. According to the Ulster County Local Plan for the year ending June 30, $887,000 — a bit more than half — of the 100 per cent federally funded agency’s $1.734-million total budget goes for staff payroll or operating costs rather than to employers or to persons being trained or employed. The $847,000 spent on direct recipient workforce training and development in a county of about 180,000 in population comes to less than five dollars per capita per year.

In a rapidly changing knowledge economy that increasingly rewards skills, credentials and experience, what kind of resources does that kind of money, divided into separate pots for youth, veterans, the handicapped, adults and displaced workers, provide? What kind of workforce training strategy can be developed within that bureaucratic hodgepodge?

The passage last year by Congress of the Workforce Innovation and Opportunity Act (WIOA), which replaced the Workforce Investment Act (WIA), involved more than just a change in initials. Making the majority of the membership of the new local and state WIBs either private-sector people or representatives of business organization was one of the more substantial legislative changes. The reconstituted Ulster WIB emerging from the remains if its soon-to-be self-immolated predecessor, is expected to have 20 voting members, with eleven likely to represent private employers and the other nine service providers, public agencies, labor representatives and the like.

In a political sense, the composition of the membership isn’t critical, anyway. Longtime WIB member Michael Berg of Family of Woodstock told his colleagues he didn’t remember any meetings with close votes. The people in attendance, he said, “were there because of the important work we do.”

Chairman Frank Falatyn encouraged those who were no longer going to be voting members to continue to attend and participate in the WIB.

 

“Without a helping hand from the public sector, too many jobseekers and incumbent workers who don’t have string educational attainment or strong professional networks will not be able to seize emerging opportunities or partake in the benefits of overall growth,” says a May 2015 report called “Seeking a State Workforce Strategy” from the Center for an Urban Future and NYATEP, a statewide job development organization. The report, authors Melinda Mack and David Jason Fischer say, “focuses on how the state needs to define, communicate, invest in and implement a consistent strategy to increase its supply of skilled workers.”

Unlike some other states, New York State has no clear overall strategy to raise the skills of its entire work force, the report claimed. California’s WIB, by contrast, in 2012 adopted a strategic plan focused on regional and sectoral partnerships within a career pathways framework to which local plans were expected to align. Since then, California has budgeted significantly more money for workforce development.

Separating out total New York spending into the sub-categories of adult education, employment and training, and post-secondary transition services, “Seeking a State Workforce Strategy” calculated the spending of nearly a dozen state agencies and “myriad” state and federal funding streams. The major finding? New York State’s spending in the training and employment sector decreased from the relatively small total of about $375 million in 2009 to $315 million last year.

“The next step in New York’s ongoing economic recovery is to ensure that its benefits spread to a wider share of state residents by helping them add skills that will both augment their earning power and address employers’ talent needs,” stated the new report.

 

The mismatch between workforce skills and employment needs is palpable. “Too many New Yorkers now in the workforce lack the educational credentials to compete for these positions, particularly in communities that have never recovered from the disappearance of manufacturing jobs or economic decline over the past 50 years,” the report says.

The problem cuts both ways. In this disruptive age, many young people have digital and other skills in great demand. In many cases, however, they either lack the cultural skills to compete for positions or there aren’t many appropriate jobs where they are. If they live in a county like Ulster, for instance, they face an economy in which understanding of the impact of technology on business opportunity is underdeveloped.

“We don’t have a lot of depth,” said Marmo about the local labor market after the meeting.

The most challenging part of the state report may be its conclusion that there’s a disconnect between workforce activities and New York’s much-touted structure of regional economic development councils (REDCs). In this field, REDC isn’t helping. Despite lip service on skills training issues, the report calculated that just under one per cent of state REDC funds were devoted to a workforce focus. Bricks and mortar garner bigger headlines.

By failing to connect training to investment in economic development, the new report said, “The REDCs are missing a golden opportunity to ensure that community residents can connect to the new jobs and advancement pathways enabled by REDC activities and resource secured.” Without a comprehensive strategy, few workers are trained for new job skills, and existing skills go unrecognized. Employers instead stress formal education, often hiring outside candidates.

One might hope that a bleak picture is susceptible to improvement. The discussion has to start somewhere. I’ve attended more than a half-dozen local WIB meetings in recent years, and I can say with complete confidence that the appalling waste of human capital in the training and employment picture in Ulster County has never once been discussed.

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