How 2017's leaders should think about jobs

June 21, 2016

Many politicians and presidential candidates make job creation sound easy. Cut taxes, create incentives, or invest in new infrastructure, they say. In reality, private market forces and innovation tend to drive job creation. The real role for political leaders and the government may in fact be to create an environment in which people get better jobs, and employers find higher-skilled workers to fill job openings.

For example, government can support strategies that engage employers and other partners in a region to ensure that there are skilled workers for available jobs in an industry, allowing businesses to grow. We’re not talking about financial incentives to attract businesses, but rather local partnerships of employers, the workforce system, and education and training providers, which can help to spur economic growth. Evidence shows that these sector-based strategies effectively improve labor-market outcomes for workers and engage employers to meet their hiring needs.

A key to sector-based strategies involves understanding the dynamics of a sector, the jobs and skills in demand, and employer needs. For example, because the aging baby boomer population will increasingly require health care, many communities expect increased job growth in the health care sector. Such leading-sector strategies (and an understanding of long-term demographic changes at the local level) can help employers and industry associations tap into labor market information to understand the skills and preparation needed for these jobs beyond the basic educational requirement of an associate’s degree.

In addition to health care, there are sector-based strategies around the country focused on such industries as manufacturing, energy, and technology. The Workforce Innovation and Opportunity Act (WIOA), for example, encourages the development of sector-based strategies to train local workforces and promote economic growth.

We found evidence of such partnerships in our review of the High Growth Job Training Initiative, in which more than 160 grants were awarded by the Department of Labor to establish industry-focused job training and related projects to help meet workforce challenges.

We found that working closely with employers was essential to implementing industry-focused projects. Employers were the central hub to provide the most critical need—occupational training—but also to help recruit workers in particular populations, distance learning projects, career ladders, occupational competency criteria, and virtual and simulated work experiences. With respect to training, we have also found evidence of the importance of community and technical colleges in helping to developing skilled regional workforces.

Whoever is elected this fall can promote economic growth by supporting effective implementation of sector strategies through WIOA. Building off available research and best practices, maintaining available funding for such strategies, and calling on employers to join efforts at the local level is an evidence-based path to job growth.   

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