Workforce Investment Act: Innovative Collaborations between Workforce Boards and Employers Helped Meet Urgent Local Workforce Needs
Published: 2012-02-16T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: This testimony discusses collaboration between workforce boards, employers, and others. As the United States continues to face high unemployment in the wake of the recent recession, federally funded workforce programs can play an important role in bridging gaps between the skills present in the workforce and the skills needed for available jobs. However, there is growing recognition that these programs need to better collaborate with employers to align services and training with employers needs. The Workforce Investment Act of 1998 (WIA) envisioned such collaboration by focusing on employers as well as jobseekers, establishing a dual customer approach. To create a single, comprehensive workforce investment system, WIA required that 16 programs administered by four federal agenciesthe Departments of Labor (Labor), Education, Health and Human Services, and Housing and Urban Developmentprovide access to their services through local one-stop centers, where jobseekers, workers, and employers can find assistance at a single location. In addition, WIA sought to align federally funded workforce programs more closely with local labor market needs by establishing local workforce investment boards to develop policy and oversee service delivery for local areas within a state and required that local business representatives constitute the majority membership on these boards. Today, about 600 local workforce boards oversee the service delivery efforts of about 1,800 one-stop centers that provide access to all required programs.
Despite the vision of collaboration between local employers and the workforce investment system, we and others have found that collaboration can be challenging. For example, in previous reports, we found that some employers have limited interaction with or knowledge of this system and that employers who do use the one-stop centers mainly do so to fill their needs for low-skilled workers. This testimony is based on our report, which was released yesterday, entitled Workforce Investment Act: Innovative Collaborations between Workforce Boards and Employers Helped Meet Local Needs.
section_title: What GAO Found
paragraphs: Workforce board officials and their partners in the 14 initiatives cited a range of factors that facilitated building innovative collaborations. Almost all of the collaborations grew out of efforts to address urgent workforce needs of multiple employers in a specific sector, rather than focusing on individual employers. The partners in these initiatives made extra effort to engage employers so they could tailor services such as jobseeker assessment, screening, and training to address specific employer needs. In all the initiatives, partners remained engaged in these collaborations because they continued to produce a wide range of reported results, such as an increased supply of skilled labor, job placements, reduced employer recruitment and turnover costs, and averted layoffs. While these boards were successful in their efforts, they cited some challenges to collaboration that they needed to overcome. Some boards were challenged to develop comprehensive strategies to address diverse employer needs with WIA funds. For example, some boards staff said that while their initiatives sought to meet employer needs for higher-skilled workers through skill upgrades, WIA funds can be used to train current workers only in limited circumstances, and the boards used other funding sources to do so. Staff from most, but not all, boards also said that WIA performance measures do not reflect their efforts to engage employers, and many boards used their own measures to assess their services to employers. Labor has taken various steps to support local collaborations, such as conducting webinars and issuing guidance on pertinent topics, and contributing to a new federal grant program to facilitate innovative regional collaborations. Yet, while many boards cited leveraging resources as a key to facilitating collaboration, Labor has not compiled pertinent information on effective practices for leveraging resources and made it easy to access.

section_title: Letter
paragraphs: I am pleased to be here today to discuss collaboration between workforce  boards, employers, and others. As the United States continues to face  high unemployment in the wake of the recent recession, federally funded  workforce programs can play an important role in bridging gaps between  the skills present in the workforce and the skills needed for available jobs.  However, there is growing recognition that these programs need to better  collaborate with employers to align services and training with employers’  needs. As you know, the Workforce Investment Act of 1998 (WIA)  envisioned such collaboration by focusing on employers as well as  jobseekers, establishing a “dual customer” approach. To create a single,  comprehensive workforce investment system, WIA required that 16  programs administered by four federal agencies—the Departments of  Labor (Labor), Education, Health and Human Services, and Housing and  Urban Development—provide access to their services through local one- stop centers, where jobseekers, workers, and employers can find  assistance at a single location. In addition, WIA sought to align federally  funded workforce programs more closely with local labor market needs by  establishing local workforce investment boards to develop policy and  oversee service delivery for local areas within a state and required that  local business representatives constitute the majority membership on  these boards. Today, about 600 local workforce boards oversee the  service delivery efforts of about 1,800 one-stop centers that provide  access to all required programs.
Despite the vision of collaboration between local employers and the  workforce investment system, we and others have found that  collaboration can be challenging. For example, in previous reports, we  found that some employers have limited interaction with or knowledge of  this system and that employers who do use the one-stop centers mainly  do so to fill their needs for low-skilled workers. My remarks today are  based on our report, which was released yesterday, entitled Workforce  Investment Act: Innovative Collaborations between Workforce Boards and  Employers Helped Meet Local Needs. We examined promising practices  for collaboration between workforce investment boards, employers,  education providers, and others that have demonstrated positive results.  Specifically, we examined (1) the factors that facilitated innovative  collaborations among workforce boards, employers, and others; (2) the  major challenges to collaboration; and (3) what actions the Department of  Labor has taken to support local workforce boards in their collaborative  efforts.
In addition to the Departments of Labor, Education, Health and Human Services, and  Housing and Urban Development, which administer one-stop programs, we also  requested nominations from the Department of Commerce, which administers key  economic development programs. regulations, and other documents pertaining to the key federal programs.  We conducted our work between November 2010 and January 2012 in  accordance with generally accepted government auditing standards.  Those standards require that we plan and perform the audit to obtain  sufficient, appropriate evidence to provide a reasonable basis for our  findings and conclusions based on our audit objectives. We believe that  the evidence obtained provides a reasonable basis for our findings and  conclusions based on our audit objectives.
In summary, workforce board officials and their partners in the 14  initiatives cited a range of factors that facilitated building innovative  collaborations. Almost all of the collaborations grew out of efforts to  address urgent workforce needs of multiple employers in a specific  sector, rather than focusing on individual employers. The partners in  these initiatives made extra effort to engage employers so they could  tailor services such as jobseeker assessment, screening, and training to  address specific employer needs. In all the initiatives, partners remained  engaged in these collaborations because they continued to produce a  wide range of reported results, such as an increased supply of skilled  labor, job placements, reduced employer recruitment and turnover costs,  and averted layoffs. While these boards were successful in their efforts,  they cited some challenges to collaboration that they needed to  overcome. Some boards were challenged to develop comprehensive  strategies to address diverse employer needs with WIA funds. For  example, some boards’ staff said that while their initiatives sought to meet  employer needs for higher-skilled workers through skill upgrades, WIA  funds can be used to train current workers only in limited circumstances,  and the boards used other funding sources to do so. Staff from most, but  not all, boards also said that WIA performance measures do not reflect  their efforts to engage employers, and many boards used their own  measures to assess their services to employers. Labor has taken various  steps to support local collaborations, such as conducting webinars and  issuing guidance on pertinent topics, and contributing to a new federal  grant program to facilitate innovative regional collaborations. Yet, while  many boards cited leveraging resources as a key to facilitating  collaboration, Labor has not compiled pertinent information on effective  practices for leveraging resources and made it easy to access.
subsections: section_title: Several Key Factors Supported Initial Collaboration and Sustained It over Time
paragraphs: While the 14 selected initiatives varied in terms of their purpose, sector,  and partners involved, the boards and their partners cited common  factors that facilitated and sustained collaboration. These were (1) a focus  on urgent, common needs; (2) leadership; (3) the use of leveraged  resources; (4) employer-responsive services; (5) minimizing  administrative burden; and (6) results that motivated the partners to  continue their collaboration.
With regards to focusing on urgent, common needs, almost all of the  collaborations grew out of efforts to address urgent workforce needs of  multiple employers in a specific sector, such as health care,  manufacturing, or agriculture, rather than focusing on individual  employers (see table 1). The urgent needs ranged from a shortage of  critical skills in health care and manufacturing to the threat of layoffs and  business closures. In San Bernardino, California, for example, some  companies were at risk of layoffs and closures because of declining sales  and other conditions, unless they received services that included  retraining for their workers. In one case, employers in Gainesville,  Florida, joined with the board and others to tackle the need to create  additional jobs by embarking on an initiative to develop entrepreneurial  skills.
According to those we interviewed, by focusing on common employer  needs across a sector, the boards and their partners produced innovative  labor force solutions that, in several cases, had evaded employers who  were trying to address their needs individually. In several cases,  employers cited the recruitment costs they incurred by competing against  each other for the same workers. By working together to develop the local  labor pool they needed, the employers were able to reduce recruitment  costs in some cases.
Boards also facilitated collaboration by securing leaders who had the  authority or the ability, or both, to persuade others of the merits of a  particular initiative, as well as leaders whose perceived neutrality could  help build trust. Officials from many initiatives emphasized the importance  of having the right leadership to launch and sustain the initiative. For  example, in Northern Virginia, a community college president personally  marshaled support from area hospital chief executive officers and local  leaders to address common needs for health care workers.
Another factor that facilitated collaboration was the use of leveraged  resources. All of the boards and their partners we spoke with launched or  sustained their initiatives by leveraging resources in addition to or in lieu  of WIA funds. In some cases, partners were able to use initial support,  such as discretionary grants, to attract additional resources. For example,  in Golden, Colorado, the board leveraged a Labor discretionary grant of  slightly more than $285,000 to generate an additional $441,000 from  other partners. In addition to public funds, in all cases that we reviewed,  employers demonstrated their support by contributing cash or in-kind  contributions.
In all cases, boards and their partners provided employer-responsive  services to actively involve employers and keep them engaged in the  collaborative process. Some boards and their partners employed staff  with industry-specific knowledge to better understand and communicate  with employers. In other initiatives, boards and partners gained  employers’ confidence in the collaboration by tailoring services such as  jobseeker assessment and screening services to address specific  employers’ needs. For example, a sector-based center in Chicago,  Illinois, worked closely with employers to review and validate employers’  own assessment tools, or develop new ones, and administer them on  behalf of the employers, which saved employers time in the hiring  process. Boards and their partners also strengthened collaborative ties  with employers by making training services more relevant and useful to  them. In some cases, employers provided direct input into training  curricula. For example, in Wichita, Kansas, employers from the aviation  industry worked closely with education partners to develop a training  curriculum that met industry needs and integrated new research findings  on composite materials. Another way that some initiatives met employers’  training needs was to provide instruction that led to industry-recognized  credentials. For example, in San Bernardino, a training provider  integrated an industry-recognized credential in metalworking into its  training program to make it more relevant for employers.
Boards also made efforts to minimize administrative burden for employers  and other partners. In some cases, boards and their partners streamlined  data collection or developed shared data systems to enhance efficiency.  For example, in Cincinnati, Ohio, the partners developed a shared data  system to more efficiently track participants, services received, and  outcomes achieved across multiple workforce providers in the region.
Finally, partners remained engaged in these collaborative efforts because  they continued to produce a range of results for employers, jobseekers  and workers, and the workforce system and other partners, such as  education and training providers. For employers, the partnerships  produced diverse results that generally addressed their need for critical  skills in various ways. In some cases, employers said the initiatives  helped reduce their recruitment and retention costs. For example, in  Cincinnati, according to an independent study, employers who  participated in the health care initiative realized about $4,900 in cost  savings per worker hired. For jobseekers and workers, the partnerships  produced results that mainly reflected job placement and skill attainment.  For example, in Wichita, of the 1,195 workers who were trained in the use  of composite materials in aircraft manufacturing, 1,008 had found jobs in  this field. For the workforce system, the partnerships led to various  results, such as increased participation by employers in the workforce  system, greater efficiencies, and models of collaboration that could be  replicated. Specifically, officials with several initiatives said they had  generated repeat employer business or that the number and quality of  employers’ job listings had increased, allowing the workforce system to  better serve jobseekers.
section_title: Workforce Boards Overcame Some Challenges to Address Diverse Employer Needs and Developed Their Own Measures to Track Employer Engagement
paragraphs: While these boards were successful in their efforts, they cited some  challenges to collaboration that they needed to overcome. Some boards  were challenged to develop comprehensive strategies to address diverse  employer needs with WIA funds. WIA prioritizes funding for intensive  services and training for low-income individuals when funding for adult  employment and training activities is limited. The director of one board  said that pursuing comprehensive strategies for an entire economic  sector can be challenging, because WIA funds are typically used for  lower-skilled workers, and employers in the region wanted to attract a mix  of lower- and higher-skilled workers. To address this challenge, the  director noted that the board used a combination of WIA and other funds  to address employers’ needs for a range of workers. Additionally, some  boards’ staff said that while their initiatives sought to meet employer  needs for skill upgrades among their existing workers, WIA funds can be  used to train current workers only in limited circumstances, and the  boards used other funding sources to do so. Among the initiatives that  served such workers, the most common funding sources were employer  contributions and state funds.
In addition, staff from most, but not all, boards also said that WIA  performance measures do not directly reflect their efforts to engage  employers. Many of these boards used their own measures to assess  their services to employers, such as the number of new employers served  each year, the hiring rate for jobseekers they refer to employers, the  interview-to-hire ratio from initiative jobseeker referrals, the retention rate  of initiative-referred hires, the number of businesses returning for  services, and employer satisfaction.
section_title: Labor Has Taken Steps to Support Local Collaborative Efforts and Address Some Challenges but Has Not Made Information on Leveraging Resources Readily Available
paragraphs: In order to support local collaborations like these, Labor has conducted  webinars and issued guidance on pertinent topics, and has also  collaborated with other federal agencies in efforts that could help support  local collaboration. For example, Labor is working with the Department of  Education and other federal agencies to identify existing industry- recognized credentials and relevant research projects, and has issued  guidance to help boards increase credential attainment among workforce  program participants. In addition, Labor has recently worked with  Commerce and the Small Business Administration to fund a new  discretionary $37 million grant program called the Jobs and Innovation  Accelerator Challenge to encourage collaboration and leveraging funds.  Specifically, this program encourages the development of industry  clusters, which are networks of interconnected firms and supporting  institutions that can help a region create jobs. A total of 16 federal  agencies will provide technical resources to help leverage existing agency  funding, including the 3 funding agencies listed above.
While Labor has taken some steps to support local collaborations, it has  not made information it has collected on effective practices for leveraging  resources easily accessible, even though many of the boards we  reviewed cited leveraging resources as a key to facilitating collaboration.  For example, Labor maintains a website for sharing innovative state and  local workforce practices called Workforce3One, which has some  examples of leveraging funding at the local level. However, the website  does not group these examples together in an easy to find location, as it  does for other categories such as examples of innovative employer  services or sector-based strategies. Moreover, although certain  evaluations and other research reports have included information on  leveraging resources,disseminated in one location. this information has not been compiled and  In conclusion, at a time when the nation continues to face high  unemployment, it is particularly important to consider ways to better  connect the workforce investment system with employers to meet local  labor market needs. The 14 local initiatives that we reviewed illustrate  how workforce boards collaborated with partners to help employers meet  their needs and yielded results: critical skill needs were met, individuals  obtained or upgraded their skills, and the local system of workforce  programs was reinvigorated by increased employer participation. Labor  has taken several important steps that support local initiatives like the  ones we reviewed through guidance and technical assistance, and  through collaborative efforts with other federal agencies. However, while  Labor has also collected relevant information on effective strategies that  local boards and partners have used to leverage resources, it has not  compiled this information or made it readily accessible. As the workforce  system and its partners face increasingly constrained resources, it will be  important for local boards to have at their disposal information on how  boards have effectively leveraged funding sources. In our report, we  recommended that Labor compile information on workforce boards that  effectively leverage WIA funds with other funding sources and  disseminate this information in a readily accessible manner. In its  comments on our draft report, Labor agreed with our recommendation  and noted its plans to implement it.
This concludes my prepared statement. I would be happy to answer any  questions that you or others members of the subcommittee may have.
section_title: GAO Contact and Acknowledgments
paragraphs: For further information regarding this testimony, please contact Andrew  Sherrill (202-512-7215 or sherrilla@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on  the last page of this statement. Individuals who made key contributions to  this testimony include Laura Heald (Assistant Director), Chris Morehouse,  Jessica Botsford, Jean McSween, and David Chrisinger.
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