Sustained Funding Needed For Training To Meet State’s Skilled Labor Needs

The Workforce Competitiveness Trust Fund delivers the best bang for the State’s buck, so let’s fund it!

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Photo credit: Commonwealth Corporation

According to a recent survey, two thirds of employers in Massachusetts have trouble finding workers with the right skills. That’s not surprising when you consider that one in three adults in our state have only a high school diploma or less. Not to mention, nearly one third of the state’s labor force is over the age of 55 and will be retiring soon. These are among the realities that combine to create a perfect storm, threatening the stability our statewide economy.

The good news is that Massachusetts has two funding mechanisms to help address these issues: the Workforce Training Fund (WTF), a $22M fund supported by employer-backed contributions from Unemployment Insurance for incumbent worker training, and the Workforce Competitiveness Trust Fund (WCTF), a proven sector-based training model that has served hundreds of employers with qualified talent. The bad news: funding for both has decreased over the years, and only one of these has a sustained annual funding stream.

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A Workforce Win In Need of Sustained Funding

The Workforce Competitiveness Trust Fund (WCTF) was established through economic stimulus legislation passed by the Massachusetts legislature in 2006, thanks in large part to advocacy efforts led by the Workforce Solutions Group (WSG) – SkillWorks’ public policy advocacy partner made up of leaders from business, labor, workforce agencies, and community-based organizations. The Workforce Competitiveness Trust Fund invests in demand-driven programs designed by industry sector partnerships that train and place unemployed and underemployed workers. The purpose of the Fund is to support the development and implementation of employer and worker-responsive programs to enhance worker skills, incomes, productivity, and retention and to increase the quality and competitiveness of Massachusetts firms.

WCTF programs serve men and women across the Commonwealth whose life experiences and circumstances make it difficult for them to succeed in employment without targeted support. They include individuals who are underemployed and rely on aid from public benefits to support their families, individuals who have been disconnected from the workforce for a long period and people who have not been able to complete school. Others do not speak English as their first language, or have health problems or struggle with substance abuse.

Unfortunately, rather than being funded through the annual state budget process, the fund receives periodic deposits at the discretion of the Legislature. Thus, while the creation of this fund was a success in and of itself, SkillWorks, the WSG and other advocates must work tirelessly each budget cycle to ensure the WCTF receives any funding at all.

WSG FY19 State Budget Priorities

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Proven Impact and Outcomes for Massachusetts Job-Seekers and Employers

The Workforce Competitiveness Trust Fund invests in demand-driven programs designed by industry sector partnerships that train and place unemployed and underemployed workers. Between 2007 and 2011, the Fund supported 31 partnerships serving more than 6,700 youth and adults. During this period participating businesses documented significant improvements in productivity, profitability, increased sales and employee retention.

Between 2013 and 2016 the WCTF Addressing the Middle Skills Gap grant program awarded $4.5 million to 15 partnerships to train and place unemployed and underemployed individuals and meet the hiring needs of regional businesses. The industry sectors represented by these partnerships included construction, manufacturing, healthcare, early childhood education, financial services, transportation and travel and tourism.

Download the WCTF 2017 Annual Report

Outcomes

  • 903 Job seekers enrolled
  • 817 Job seekers completed training (93%)
  • 670 People were placed in jobs
  • 447 Employers hired a job seeker who participated in this round
  • 74% Placement rate out of enrollments vs 56% National rate
  • 83% Retained for 6 months vs 64% National rate
  • $15.02 Average wage of those placed in jobs

Demographics

  • 56% Racial/ethnic minority
  • 42% Female
  • 84% Low-income
  • 57% Have a high school diploma or less
  • 40% Received public assistance

Download the 2017 WCTF one-pager

Policy Solution in the Pipeline

Initially introduced by the late Senator Kenneth Donnelly, and Representative Joseph Wagner, a solution to the WCTF dilemma is already making its way through the Massachusetts state legislature: Senate bill 2192 – An Act to Diversify the Use of the Workforce Training Fund to Support the Workforce Competitiveness Trust Fund.

The goal of this legislation is to broaden the use of the Workforce Training Fund to meet the needs for skilled labor where there are job vacancies; and to enable unemployed and underemployed people to access skills training for jobs. If passed, it would allow up to $2.2 million per year to be used from the Workforce Training Fund for sector-based job training for non-incumbent workers, allocated through the Workforce Competitivness Trust Fund.

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“5% Bill” Nuts & Bolts

Informally called the “5% bill,” this piece of legislation would allow up to 5% of the WTF (currently funded at $22 million per year), to also be used for pipeline training through the WCTF. Pipeline training is the supply chain for our workforce; ensuring that we have people trained with the necessary skills to fill job vacancies; such as airplane mechanics, dental hygienists, machine operators, licensed truck drivers, etc.

If 5% of the WTF were able to be used for pipeline training for unemployed people or non-incumbent workers; that would amount to $1.1 million of the $22 million. A state match would bring the amount up to $2.2 million and create a sustained fund for workforce training.

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Opportunity to Leverage Strong Existing Support

The bill passed the Senate unanimously on October 26, 2017. An amendment was adopted to name the grants the “Senator Kenneth J. Donnelly Workforce Success grants” in honor of the late Senator Ken Donnelly who originally filed the bill with Representative Joseph Wagner.

Despite this exciting progress, this bill still needs support to get across the finish line! Following passage in the Senate, the 5% bill was referred to the House Ways and Means Committee, chaired by Representative Jeffrey Sanchez.

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Please help this bill get passed by reaching out to your representatives to inform them about this important legislation and pledge your support!

Find your legislators

To learn more about how you can support this and other workforce advocacy efforts, contact Kathie Mainzer, Director of the Workforce Solutions Group at kmainzer@strategygroupinc.com or 617-263-3344

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Bill Details:

S.2192 – An Act to Diversify the use of the Workforce Training Fund to Support the Workforce Competitiveness Trust Fund

Lead Sponsors: Senator Kenneth Donnelly and Representative Joseph Wagner Cosponsors: Sen. Donoghue, Sen. Lewis, Sen. Lovely, Sen. McGee, Rep. Connolly, Rep. Crighton, Rep. Gordon, Rep. Malia, Rep. Schmidt, Rep. Vega

Download the fact sheet

>>More information and resources<<

Another Way to Support: FY19 Budget Amendment!

The FY19 House Ways and Means budget recommends many important investments in job training and education, PLUS an amendment filed by Representative Paul Brodeur to allow 5% of the Workforce Training Fund to be used by the WCTF.

Contact Samuel.Larson@mahouse.gov or call 617-722-2013 to learn more and pledge your support!

Author: SkillWorks

SkillWorks is a nationally recognized workforce funder collaborative, launched by the Boston Foundation in 2003 to improve workforce development in Boston and across Massachusetts. SkillWorks brings together philanthropy, government, community organizations and employers to address the twin goals of: 1) Helping low-skill, low-income individuals attain family-supporting jobs; and 2) Helping employers find and retain skilled employees.

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