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The Key to Economic Recovery: Local Business-Led Workforce Development Boards

Published July 15th, 2020

By Matt Bandstra, Associate Director of Policy, NAWB 

How did we get here? 

At the beginning of March 2020, the United States economy was stronger than it had been in recent memory. National unemployment rates were flirting with 4.4%, near a 50-year low, and all indications suggested that the positive momentum would carry for the foreseeable future.

Then the unthinkable happened, the United States economy shuttered to a near standstill. Thousands of businesses have had to temporarily close their doors and the 4.4% unemployment rate of early March seems like a distant memory. In the months since the shuttering of the economy the effective unemployment rate is hovering around 14.7% with more than 33 million Americans filing for unemployment benefits.

In less than one financial quarter the United States economy has experienced a head spinning 180-degree turn from historic lows in unemployment to levels that have not been seen in this country since the Great Depression.

Where do we go from here?

In the United States the framework for economic recovery is already in place through more than 550 local workforce development boards (WDBs). These WDBs span local areas across the country, operating 2,000+ American Job Centers (AJCs). Local WDBs are practiced, effective, and agile frontline responders for local economies. The COVID-19 crisis is not their first challenge, though it may prove to be their greatest.

Local WDBs boast some of the strongest success rates among all publicly funded entities, with more than 80% of job seekers receiving full WIOA services entering gainful employment. This is a testament not only to the effectiveness of training but, to the ability of local WDBs to be responsive to their individual communities. Local WDBs serve as convenors of local economies, forming partnerships with in-demand industry sectors, training providers, and educational institutions. This allows them to identify, train and place job seekers with unmatched effectiveness.

Why now?

The American public is already feeling the effects of this crisis, and a majority (64%) are concerned they will lose their employment. Among those in the workforce, 57% are worried they will lose their jobs. One-third of these individuals believe that if they lose their jobs, they will need additional education and new skills to find a comparable one*. When the American labor force needs to be reskilled, they will turn to the workforce development system. Congress must make sure local WDBs have the resources to tackle this challenge.

The United States does not have the luxury to sit back and hope the economy will return to it is pre-COVID-19 state. As states begin to reopen, the time to inject emergency funding into the workforce system is now. A $15 billion investment into this system has been proposed by key Members of the House of Representatives, and these proposed funds could not reach the local level soon enough. The demand the workforce system will soon see will be unparalleled, and it is vital that local WDBs are provided the resources to meet this demand.

The narrative that the economy will resume business as normal when lockdowns are lifted is an unfortunate fallacy. Conservative estimates showed that, before the COVID-19 crisis, that an additional 2 million Americans would require reskilling compared to previous years’ levels. This is not accounting for the range of estimates suggesting that between 20% to 65% of jobs would be impacted by automation over the next decade. If we were not in an unprecedented economic crisis due to COVID-19, the American worker would still be facing extraordinary changes in the nature of the work that is required of them. We are facing compounding variables in the labor market, that will impact us for decades to come. If we do not invest in the workforce today, business and workers alike will be left without the necessary resources to keep the United States economy competitive on a global scale.



*According to these survey results published by Strada: https://www.stradaeducation.org/wp-content/uploads/2020/04/Public-Viewpoint-Report-Week-1.pdf?utm_source=hs_email&utm_medium=email&utm_content=85647990&_hsenc=p2ANqtz-931qW3uvugU9PgqjonpZP2M1VKd7mIynyem9zYcO0fii_Ni_r1EHZtsHdH4boKH7qx7idk4YCQpWE53QIPMCRuZeYt6w&_hsmi=85647990


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