Thinking Bigger About Workforce Development

Nearly all economic developers are now consumed with supporting workforce and talent development, seeking ways to grow and retain workers for increasingly talent-hungry employers.  Yet, we all know the reality:  the US still does a poor job of supporting effective workforce development and training efforts. 

A fascinating new Aspen Institute report, from Harvard’s Rachel Lipson, seeks to explain these patterns.  America’s Missing Productivity Strategy:  An R&D Approach to Workforce Development contends that we must start thinking bigger about workforce development.  First off, we likely need to invest more in workforce training.  Costs for training programs that lead to high-paying jobs typically range from $10-45K per person, but the typical public training voucher now has a value of $2000.  The US now spends about 0.1% of GDP on active labor market policies, at the bottom of rankings of developed economies.

Thinking bigger is not just about money.  Lipson argues that workforce policies should be more tightly linked to other industrial strategy priorities, such as supporting AI and new chip technologies.  In addition, she advocates for more experimentation, with DARPA-like investments in new training programs and approaches.  Finally, she calls for targeted policies that focus on legacy, retooled, and frontier jobs based on technology trends in key sectors.  Overall, Lipson offers many useful ideas and a much-needed call for new and bigger thinking on how we support workforce development.