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Potential Further Work Addressing Disparities

Previous policy reports have recommended various programming changes that DEED could enact to reduce disparities. We also asked workforce development program managers in the field for their own opinion regarding DEED's potential role in reducing disparities.

A few broad themes emerge both from policy reports and from the program managers we interviewed. These include serving people of color more intentionally, engaging with employers more intentionally around how to successfully employ individuals with barriers, and finding performance solutions to serving participants with barriers.

Serve People of Color More Intentionally

The 2014 Racial Equity Agenda of the Organizing Apprenticeship Project (now known as Voices for Racial Justice) has multiple specific recommendations for DEED around serving people of color more intentionally:

The Department of Employment and Economic Development (DEED) can be a stronger partner in closing that gap by intentionally assessing the impact of its programs on people of color. Its programs for long-term unemployed people, dislocated workers, and others should prioritize reaching people of color most impacted by the economic recession, but also facing limited opportunities to education and training. A racial equity impact analysis process, one that is being used in other public entities, including the Minneapolis Public Schools, could also improve DEED's success in closing the employment gap and building living wage, family sustaining careers.

Multiple program managers spoke about the importance of having staff reflective of the population they serve and of offering culturally relevant programming. Tuleah Palmer, Executive Director of the Northwest Indian OIC, said:

"One of the things that I saw that I am constantly championing and echoing is when we, as an organization, flipped our organization and started doing things inside the cultural context and the worldview of the community we were serving, the response was something unseen and unprecedented. I think that's why I feel this big conviction about being very vocal about culturally responsive programming. Historically, this organization had served between 175 and 200 participants per year. And when we did that, our numbers jumped up to 1200 a year."

One program manager echoed this when asked what DEED could do to address disparities, but acknowledged the political difficulty of seeming to prioritize some groups over others:

"Some general recommendations I had for DEED were to understand different demographics and to prioritize the needs of each group and then stand behind those prioritizations. Sometimes in a political atmosphere, it might be hard to defend prioritizing helping minorities, but they [DEED] should still do it."

DEED's potential specifically as a funder was also addressed by program managers we interviewed. One program manager spoke to how a dedicated grant can effectively focus resources on serving a subset of program participants, leading to more intentional service:

"If we had a dedicated pot of funding to serve individuals from communities of color, we would expand the partners we're working with, bring them together, brainstorm what are the best strategies for this population, and identify how their needs are different. We aren't able to get to this depth through our regular programming. Our two biggest populations that are experiencing disparities are older workers and offenders. We focused our Adult Workforce Development grant on these populations and it taught us a lot about these two populations, even though we had been serving them for years."

Another program manager spoke to the same idea that the funding agency has the ability to set the agenda on disparities reduction:

"I think sometimes the key to that [addressing disparities] is funding, which is terrible for me to have to say because I don't want more funding requirements! But if the agencies who are funding require that there is some sort of disparities plan or some sort of discussion, then it'll happen."

Engage with Employers More Intentionally Around Employing Individuals with Barriers

Because DEED administers both workforce development and business development programs, multiple recommendations center on aligning disparity reduction priorities in both areas. For example, one program manager suggested DEED could explicitly leverage workforce development and business development funding by writing cooperation into the contracts with businesses:

"[W]hat I've tried to do as a strategy is reach out to the employers that DEED is supporting and say 'Ok, DEED is supporting you with this MJSP [grant], and you're expanding, and you're getting to train incumbent workers. But I know you need to hire a bunch of new workers. Well, DEED is funding us, too. So why don't you work with us?' And I don't get lots of legs there. I haven't gotten a great response. [DEED could tell these employers,] 'You put in 5 million and we'll put in a million, or we'll put in 500,000 for every 5 million. However, if you hire x number of your new employees from our P2P [Pathways to Prosperity] grant recipients, well now, actually, you only have to put in this much, because you're going to be leveraging other efforts."

At least one recent report has suggested business development strategies to combat disparities. Growth and Justice suggests in their report on Workforce Equity Progress in 2013-14: "Promote and prioritize economic development and job creation decisions that have racial equity in employment as an explicit goal, and improve accountability for diversity and equity outcomes."

Multiple managers spoke to more general employer outreach on behalf of job seekers with barriers, including workforce development participants:

"I think it is DEED's responsibility to say to employers: Reevaluate your hiring practice, reevaluate what you're looking at and is it shutting out Minnesotans because they quote unquote may not look like you."

"I think if DEED, just because with the disparity a lot of times of particularly black males, it has to do with a [criminal] background. It's so much harder to get a job when you have a background, and unfortunately that's who it impacts the most. And I think if there was some kind of [... effort at DEED] cutting around the taboo and the intimidation that employers feel about people with backgrounds, I think that would be [helpful]."

Find Performance Solutions for Serving Participants with Barriers

The Dislocated Worker and WIA Adult programs require local providers to meet performance goals around the percentages of their participants who get a job, who keep a job for six months, and who earn a credential, as well as a goal around the average earnings of participants. Local service providers-and states-which fail to meet their targets may lose federal funding.

Research has shown, and conversations with workforce development professionals in the field have confirmed, that the current federal performance metrics create an incentive structure that rewards "cream skimming" -that is, focusing enrollment on participants who are likely to succeed (See Note 1). Much effort, at the local and state level, is directed toward working around these incentives to serve the participants who are less likely to have the positive outcomes that these programs need to secure funding.

Federal performance rules do allow providers to exclude some participants from their official performance if that participant needs to exit the labor force, for example to care for family or for health reasons. At least one program manager said this exclusion rule allows them to take some risks on serving participants with these family care or health barriers.

Importantly, the state-funded Adult Workforce Development program does not directly tie funding to performance metrics. Instead, past performance is considered in the competitive proposal process. Some program managers have reported that this allows them to use their Adult Workforce Development funds to target populations with barriers which would be difficult to serve in a federal program.

Additionally, some program strategies that have the potential to reduce racial and class disparities carry a performance risk, including promoting entrepreneurship and promoting on-the-job training.

The initial report from Everybody In suggests that the workforce system "foster business and entrepreneurial opportunities that result in job creation and identify practices to help enlarge the customer base for businesses owned by members of racial, ethnic and cultural communities." (See Note 2).

Promoting entrepreneurship is risky in terms of performance management because, while employment is captured through administrative data, self-employment must be verified through tax and operations paperwork provided by the participants themselves. At least one program manager reported that many of their self-employed participants are reluctant to provide this documentation, and indeed former participants have no incentive to comply with this request.

One program manager spoke about a new policy of supporting entrepreneurship among Dislocated Worker participants, which removes this performance management disincentive:

"[W]e also talk in our registration sessions about CLIMB and that the support is there if you're thinking about your own business. [...] I think CLIMB really helped us. Sometimes prior to CLIMB, we were struggling with, is it a good idea to support this person in that goal? Because they are coming from a high level, good paying job, and the program is designed to get them back into similar work. So leaving your high paying marketing job to start a drawing business is risky, and maybe not something that DEED would look at as a great career plan. And so CLIMB has been helpful in that it's encouraging that and that makes us feel a little safer with supporting people in those plans." (See Note 3).

Similarly, promoting on-the-job training is risky in terms of performance management because it generally does not result in a recognized credential. That means providers will have a much lower credential attainment rate than if their on-the-job training participants were instead engaged in classroom training.

A few different strategies exist to ensure on-the-job training results in a credential, including pairing a short term occupational safety certificate with the training or having a higher education institute's customized training department certify a credential for the proposed on-the-job training plan.

While local providers and DEED state staff have developed these examples of working around performance goals, multiple local providers have stated the need for more flexibility to serve the hardest to serve.

One program manager highlighted this point:

"I think that our role as well as DEED's role is in that of education and ensuring that there's not only grants available or focus made available on targeting some of these groups-which we've done-but also understanding that somehow, some way, if I want to say 50 percent of my WIA Adult population that I'm going to serve this year is going to be long-term unemployed and people of color. Knowing that I can do that and my performance [goal] is going to be reflective of that. That's a huge concern with us because we would like to do so many different things but we just, we realize that we have to hit here. If there could be some kind of equation that could be figured in as far as these are the characteristics of the population that we're going to serve so that performance is reflective of that. I think that would go a long way with us being able to serve more of the hard to serve."

Notes:

  1. See, for example, the book chapter Performance Management of U.S. Job Training Programs: Lessons from the Job Training Partnership Act by Burt S. Barnow and Jeffrey A. Smith.
  2. Read the full Everybody In report.
  3. Converting Layoffs Into Minnesota Businesses (CLIMB) is an entrepreneurship track in Dislocated Worker. More information can be found under the CLIMB tab.
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