Jewish Vocational Service (JVS) is an 80-year-old workforce intermediary with roots in the Depression-era period of Jewish immigration and anti-Semitic employment discrimination. Since 1938, the organization has been working to enhance the education and skills of working-age adults—who often have limited English language, skills and income—and meeting the hiring, retention and talent development needs of employers. Over the past several decades, the organization has grown to be one of the largest and most important providers of high-quality workforce development services in the region.
As the Boston regional economy explodes and the labor market tightens, JVS is growing rapidly, refining its workforce development model to more effectively meet the needs of employers and employees. The strategies, organizational culture and specific practices we have adopted, and continue to refine, represent what we believe are the core features of “Next Generation” workforce development organizations that can effectively meet the challenges and opportunities of our new economy, and can offer a road map for other organizations seeking to play this role in their regions.
This essay, the first of four, calls for and describes a new, or “Next Generation,” model for workforce organizations. The essay is based on the innovative and field-proven practices of JVS Boston’s transition to a “Next Gen” workforce organization, which is rooted in decades of field research, experimentation, evaluation, failure and success. These reflections will allow us and others to sharpen our strategies and practices in response to unprecedented economic growth and income inequality. Subsequent essays will explore related issues of practice and will address in more detail requirements for achieving scale, job quality strategies, and the challenges and opportunities of tapping the untapped workforce. achieving scale, job quality strategies, and the challenges and opportunities of tapping the untapped workforce.
We are experiencing one of the strongest and most sustained periods of economic growth and one of the highest levels of income inequality in American history. Over the past 12 months, the Boston area, like many major metropolitan areas, has experienced the double-edged sword of rapid growth:
• A Boston-area medical research organization found itself unable to fill open positions in its IT department, directly inhibiting its ability to take on new contracts.
• Across town, a rapidly growing fast casual restaurant put new store growth plans on hold for lack of qualified and reliable workers.
• Shahid is a 28-year-old Moroccan immigrant to the Boston area. He completed high school and one year of college in Morocco and worked part time as an IT technician for a transportation company before he emigrated to the United States. He is currently driving for Uber and Lyft, and hoping to attend community college.
• Maria emigrated from El Salvador to the United States eight years ago. Since her arrival she has been working in “back of the house” part-time positions in fast food, and speaks very little English.
This is Boston’s economy—white hot, innovating and expanding, and leaving thousands behind. Boston’s tale of two economies is stymieing business growth and limiting economic opportunity for individuals. Though perhaps more extreme than other locales, Boston’s challenge is not unique. Rapid job growth, tepid wage growth, low birth rates and shrinking immigration are beginning to choke economic growth and constrain equitable economic opportunity in major metropolitan areas throughout the nation.
The causes of this state of affairs are many, and are hotly debated, but there is one central dynamic that is indisputable. The labor market, left to its own devices, is failing to adequately match job demand with untapped talent.
Little serious attention has been paid to this challenge in decades. The federal government has shrunk its investment in workforce development and career education year after year, leaving cash- strapped states and localities to fill the void. Our federal workforce system, funded under the Workforce Innovation and Opportunity Act, is an anemic collection of pilot projects, understaffed career centers that too often must focus more on compliance than on job seeker needs, and guiding strategies that have seen little innovation or rigorously tested results in decades. Community colleges, perhaps the most important and effective answer to the job demand/ skills gap, struggle to meet the needs of their rapidly diversifying student bodies. They have limited resources and bureaucracies that hinder innovation and rapid response.
We are well past due to address the mismatch of job demand and job skills. Additionally, we must confront the challenge of economic growth and increasing inequality. In 2004 innovators in the workforce development field described a new type of labor market institution, called a “workforce intermediary” that sat between workers and employers and played an organizing role in regional labor markets, identifying employer and worker needs, designing new solutions, finding and aggregating resources, and brokering or delivering quality services.1 Despite the deep recession in the early years of this practice, some of these organizations, including my own, still operate, but many struggle with few consistent and flexible funding streams, and most were built for a very different economy.
Fourteen years later, long-time workforce development practitioner and theorist Steven L. Dawson issued a series of essays in response to the extreme challenges and opportunities of historically tight labor markets.2 Dawson and others, like Boston Foundation CEO Paul Grogan, sounded the alarm and argued that these times require redesigned institutions, new investment and a very different approach to workforce development in order to address skills shortages and income inequality, and meet the challenge and opportunities of this moment in history. Dawson titled his most recent essay “Now or Never” and issued “a call to action” for the field.
Grogan noted cleverly that “a tight labor market is a terrible thing to waste.”3
What follows is a response to that call for action and an argument for a “Next Gen” workforce development organization that is consciously designed to respond to the challenges and opportunities of this economic moment. Using “under the tent” examples, drawn from JVS’s hard- won lessons learned, this paper will describe four key features that comprise a Next Gen workforce organization:
Two years ago, major hospitals in Boston would not consider hiring graduates of JVS’s Nurse's Aide Training Program to fill their patient care technician vacancies. Today they will and do. Two years ago, the major hospitals would not consider hiring graduates of JVS’s Pharmacy Technician Training Program to fill their pharmacy technician vacancies. Today they will and do. Next Gen workforce organizations have the opportunity to be genuine brokers between underutilized pools of workers and understaffed employers, allowing them to closely align their mission with a sustainable business model—but only if they provide high-quality, customer-responsive service.
Throughout its modern history, workforce development has been largely a human-service endeavor built in the context of the anti-poverty drive of the early and mid-1960s. While there has consistently been accompanying rhetoric about the important role of employers, for the most part, in practice, employers were a means to an end, and the primary focus was on the supply side of the labor- market equation.
The downsides of this approach for workforce development, which in substantial ways still dominates the field, are twofold. It limits success for workers, and even when it is successful, it is not sustainable and scalable. Employers make hiring decisions based on their business needs, and rarely their social responsibility. Hiring managers are looking for dependable employees who can get the job done. If an organization can deliver that solution for them, great. If not, someone else will. If hiring is done primarily on the basis of social responsibility, and workers are not adequately prepared or matched well to appropriate openings, it is rarely sustained or scaled.
That said, in a very fundamental way, there is a symbiotic relationship between employer and labor interests. Companies need hard-working, talented labor in order to grow and thrive, and workers need jobs. Of course, the interests of employers and labor are not always so neatly aligned, as employers seek to reduce labor costs, and workers seek to maximize their earnings. And without doubt, the last three decades have seen a significant tilt toward employer power over worker power in this ongoing negotiation.
But within the labor market is a sweet spot, where the interests of employers and workers do align, and it is in this sweet spot that truly effective workforce development succeeds. In times of tight labor markets such as the current period, this alignment is most pronounced, providing opportunities for Next Gen workforce organizations to offer genuine value in the labor market, for both employers and workers.
In tight labor markets employers will change their practices and consider alternate sources of workers, and workforce solutions that they would never consider in periods of high unemployment. At JVS, we have seen very specific examples of this dynamic over the past two years as employers have begun hiring jobseekers from more diverse communities, raising wages and improving benefits in order to attract and retain a more stable workforce.
The best indication that a workforce development organization is providing real value is payment for service. One of the great challenges of public and nonprofit service delivery is that there is no market mechanism to incentivize quality. That is not to say that traditional nonprofit and public service delivery organizations cannot or do not deliver quality services, but there is no substitute for a genuine market to drive quality services and results. When customers have options, and exercise them, quality often follows.
For more than a decade, JVS has been providing workforce development services for more than 20 employers annually on a fee-for-service basis. This work has until recently focused on increasing the education and skills of incumbent workers. Employers contract with JVS to deliver a wide range of services such as English language, computer, college readiness, job skill–specific training, and coaching for their employees. This line of business, which generates nearly $2 million annually, led the organization to develop a team of highly skilled instructors, coaches and project managers who are deeply embedded with employers, respond rapidly to changing employer needs, deliver high quality services, and fix problems when they arise. The revenues are critically important for our scale and sustainability.
Over the past two years, as the job market has tightened, several of JVS’s employer partners have begun to look to the organization as a source of new workers, and now pay us to recruit, train, place and retain new employees for them. This exciting development, which is a function of the change in the job market, would not have happened without long-standing and trusted relationships with our employer partners. These new business avenues also strengthen JVS’s ability to negotiate better terms of employment, thus opening up important opportunities for the workers we serve, who are now considered for positions that would not have been an option just a few years ago.
Next Gen workforce development organizations require a market-responsive organizational culture to be successful. The leadership and staff of the workforce organization must truly believe that employers are not simply a means to an end, and that the organization exists to overcome challenges and build on opportunities for both employers and workers. While this sounds simple, it is not.
Traditional workforce development organizations, while committed in rhetoric to employer engagement, rarely have the organizational culture required to be market-responsive. Decades of systems and services designed with a human service, anti-poverty framework, and constrained by compliance-oriented public funding regulations, have led to the dominance of non–market responsive cultures in the workforce development field. Many workforce development organizations’ staff still consider employers with a degree of suspicion, and speak of employers as owing something their clients and communities. Breaking out of this mold requires a focus on building a different type of culture within Next Gen workforce development organizations. Changing culture requires constant attention to internal messaging, performance incentives, hiring and training.
More than a decade ago, when JVS launched its Business Services division, which provides fee-for-service workforce development services for businesses, the organization made a conscious decision to create a division separate from its traditional client-focused services, and recruited staff with experience in industry training, management and entrepreneurial skills. Over the past decade, as JVS has expanded its Business Services division, we have consciously and carefully incorporated the market-responsive culture of that department into other departments of the organization.
This past year, as employer demand for fee- for-service recruitment, training and placement services grew, JVS Business Services staff teamed up with staff managing our more traditional training and placement programs to co-design and deliver customized programs for employers. The program design and delivery process allowed both teams to learn from each other and improve our responsiveness to both employers and job seekers. Making this transition has not been without its challenges, as staff bring different experience, practices and guiding principles to the table. And, this work takes time, patience and resources as we make progress in changing organizational culture.
Specifically, JVS created a Business Relationships Specialist (BRS) position in every department in the organization. This effort has been several years in the making, with a number of missteps and false starts along the way. The BRS team now meets regularly to coordinate marketing, service delivery, and communication with key employers. This year the BRS team created an “Employer Engagement Guide,” which details how we build deeper relationships with key employer partners over time, using case studies and problem-solving exercises. In the coming year, the guide will be the primary focus of all staff training so that we can strengthen our employer engagement and market-responsive culture throughout the organization.
Tight labor markets and rising inequality are generating increased attention on job quality for workers, and important new opportunities have opened for the workforce development field to promote improved job quality. Our experience has helped JVS identify four pathways toward higher job quality that Next Gen workforce development organizations can take: Be selective about employers, negotiate the terms of employment, provide opportunities to pursue career advancement, and get “under the tent.”
About two years ago, we began noticing that at JVS graduations, more employers were in the room than graduates. At our occasional industry sector jobs fairs, we found ourselves running out of room to accommodate all the employers who wanted to participate. The solution to this problem seems obvious, and while the details are a bit challenging, the effort is certainly worthwhile. By becoming more selective about which companies we work closely with, based on the quality of their jobs, we can both manage demand and help our clients.
Becoming more selective about which employer relationships to invest in most actively requires two steps. First, we must develop a definition of job quality. But defining job quality is more complex than it might appear, since one employee’s definition is not the same as another’s. For example, some may value predictable and flexible hours more than wages. Similarly, one employer in a particular industry does not face the same constraints and opportunities as another. Acute healthcare organizations, for example, typically have more wage flexibility than long-term care organizations. At JVS we are developing a dynamic definition of job quality that can account for different worker priorities and employer contexts.
A clear and adjustable definition of job quality can be used to develop a screening tool that ranks employers to determine how much to invest in the relationship. JVS’s employer engagement tool defines a progression of deeper relationships with our employer partners and how to achieve them. This, combined with a flexible job quality definition, will be the basis of our job quality screening tool. Many steps remain in this effort, as countervailing pressures to provide services to all employers still exist, and will need to be reconciled.
Improving job quality through genuine employer partnerships is not a matter of preaching about the importance of job quality, or hectoring a company about how it should run its business. It is best done in the context of helping employers improve their ability to recruit and retain workers, and thus give them an edge over the competition. Next Gen workforce organizations should enter this work cautiously and with a good dose of humility, as it takes a great deal of credibility to be sought out for business advice by your employer partner. Some recent experiences suggest a way forward. In two cases, with two very different employers, we were able to move the employer to set higher wages and better schedules by suggesting that only with these changes would we attract and recruit the quality of employees that they were seeking.
Most workforce development services involve discrete education, training and placement programs that are designed to prepare a worker for a specific job. Yet the labor market is not static, and employees often aspire to move up as they improve their skills and look for more challenging and better quality positions either within their current company or with another company. Employers often aspire to create opportunities to retain their employees by presenting them with more challenging tasks and positions once they have achieved mastery of a specific set of tasks.
JVS has been building a comprehensive continuum of worker advancement services for over a decade, and in the current labor market, this is an important model for a Next Gen workforce development organization. One key element of this continuum is that JVS provides both pre-employment services and incumbent worker services, so that individuals who are hired by our employer partners can continue to take advantage of employer-sponsored skill and career advancement classes and coaching.
Several of these partnerships have developed into fully articulated career ladder programs. One example is Hebrew SeniorLife (HSL), the largest long-term care organization in the Boston area. Over the past decade, HSL has hired graduates of JVS’s nursing assistant training program, who then have the opportunity to learn additional English, computer and other skills on- site through an incumbent worker training program. As part of a career ladder initiative, HSL created a “Senior CNA” position for highly trained nursing assistants to become managers of key departments, taking on training, supervisory, activity planning, and family relations responsibilities. HSL also created a program with JVS and a local community college to transition nursing assistants into becoming Licensed Practical Nurses.
Other elements of JVS’s pre-employment services are designed to help workers “ladder up” as their life circumstances and interests allow. Individuals with limited English speaking ability can take an English for Employment class, get a starter job in the service sector, return to JVS to take certification training programs to attain a better job, and eventually prepare for a college-level certification. Because many higher-level training and education programs require a high school diploma, JVS students can earn this through our adult diploma program. They can dually enroll in our college bridge program when they are approaching graduation, earning college credits toward career pathway certificates and degrees even before completing high school. Creating a fully comprehensive continuum is challenging given how siloed public and private funding remains, but by braiding together multiple sources of funding, it is possible to achieve this goal.
Traditional workforce development puts most of its energy into training and placement. Next Gen workforce organizations that have credibility and meaningful employer relationships can move beyond this role to provide more sophisticated expertise and knowledge about how companies can effectively recruit, retain and advance their employees. Last year, we began working with a Boston-based fast-casual employer, with corporate headquarters in New York. We heard from Boston employees that one corporate- wide policy required a late closing well after midnight, which in Boston meant well after mass transit shut down for the night. We suggested to the employer that they should consider appealing to the corporate office to have an earlier closing time in Boston, so that employees can get home, and to reflect the fact that Bostonians don’t have the late night social hours more common to New York City patrons. The change was made, and recruitment and retention improved.
Through our Workforce Needs Assessment tool, JVS staff can provide employers with insights from their employees that can dramatically help their human resource challenges and improve their bottom lines. Going a step further, JVS is exploring a partnership with HR professionals to add new capacity to our workforce development tool kit, and we have partnered with a local manufacturing organization to add our English language classes to their lean manufacturing services. Either through direct services, or creative alliances and partnerships, a sophisticated Next Gen workforce development organization can expand the value proposition for employers while raising job quality for workers.
With few exceptions, most workforce development organizations are local, situated in cities, neighborhoods or regions. This is a potential strength, since labor markets are at their heart regional markets. Yet it is the rare workforce development organization that is a leader in its regional labor market. Next Gen workforce development organizations have an opportunity to change that, and become a genuine force within their regional economy.
Next Gen workforce organizations must have two levels of deep knowledge and relationships to be meaningful regional players. They must know and be known in the industry or industries that they work in, and they must know and be known in their region. Focusing on industry sectors has been a popular strategy in the workforce development field for several decades. Though there are notable exceptions, too many sectoral initiatives lack the knowledge and value-based relationships necessary to making sustainable and scalable improvements in job quality, and meeting employer and worker needs in a region.
JVS has employer partnerships in the Boston area that are well over a decade old, and the institutions that we engage with have “exchanged” employees, shared strategies and built genuine trust to address one another’s challenges and opportunities, developing a mature infrastructure of services, resources and best practices.
Regional knowledge is another key element.
Regional knowledge requires meaningful engagement with regional business associations, other educational institutions such as community and four-year colleges, community and ethnic organizations, and labor associations, to name a few. Regional knowledge also requires political engagement with local, regional and state leaders who drive both policy changes and resource decisions that can lead regional strategies and help scale effective services. JVS has invested significant time in building relationships with key city, state and regional elected officials and policy makers, through a range of activities from site visits and graduations to engagement in broader policy development efforts and direct lobbying.
Meaningful regional knowledge, engagement and leadership also should include a sophisticated communications strategy. Typically, nonprofit communication is designed to raise the profile of the organization above the noise to help drive resources in its direction. This is a laudable and smart goal, but a Next Gen workforce organization can also deploy a strong communications strategy to change policy and practice in its region. One example is to raise up both employer and provider practices that improve job quality, in order to “change the narrative” and demonstrate that employers can and should utilize job quality strategies to improve their competitiveness.
JVS has begun to do this through our twice annual “Economic Opportunity Forums” co-sponsored by the Greater Boston Chamber of Commerce and featuring well-known employers and their employees who are using creative strategies to improve job quality.
Most workforce development organizations, JVS included, have focused on service delivery, and typically have avoided efforts to expand their impact and scale through a bigger stage, too often leaving this work to policy organizations that have precious little practical experience delivering services. Not always, but frequently this results in policies and systems that bear little resemblance to what actual workers and employers need to succeed, or that set ambitious visions without the context and humility that on-the- ground practice provides.
With the unique opportunity and challenge we have before us in this moment, Next Gen workforce organizations must step out and engage on a bigger stage, using their experience and knowledge by changing policy, changing systems and changing practice throughout the field.
There are a multitude of federal and local policies that either restrict or enable workforce development organizations to help employers and workers, and focusing on one or more policy issues consumes substantial time and resources. The challenge is to identify specific policies that are likely to be changed with regional engagement, will have a substantial impact on regional workers and employers, and provide the opportunity to improve service delivery effectiveness through additional efficiencies, resources or both. A recent example: JVS has engaged in federal policy for work requirements for individuals receiving public assistance. JVS is partnering with the state welfare department in Massachusetts to deliver employment services to individuals receiving foods stamps so that they don’t lose their benefits and can attain employment or better jobs. Through our affiliation with the National Skills Coalition, JVS has been testifying before Congress, working closely with USDA administrators, and positioning Massachusetts (and JVS) to deliver more effective services.
Systems change is a very challenging undertaking, as systems are often calcified and have multiple interest groups and service providers that will resist change, even if those changes are in the interests of consumers. As with policy engagement, engaging in systems change needs to be done with a strategic focus that can benefit workers and employers, and simultaneously improve direct service delivery through efficiencies, additional resources or both. A recent example: JVS’s Pay For Success/Social Impact Bond (PFS) project, which provides a very different model of adult education service delivery than is typical under the traditional Adult Basic Education system. The vast majority of adult education students enroll in classes in order to improve their skills (often English language) in order to get a job or a better job. But traditional adult education is designed primarily to support increased language acquisition and education as measured through learning gains, and employment skills and employment are very much a secondary goal.
JVS’s PFS project, which combines adult education and employment services to serve nearly 2,000 individuals, also has a systems-change component. We are demonstrating to the Commonwealth of Massachusetts that delivering adult education very differently will significantly benefit workers, employers and the Commonwealth. We are also urging the Commonwealth to evaluate adult education very differently, using administrative wage-earning data as the ultimate judge of success, and only paying for clearly demonstrated success. This systems-change effort, though a major and long-term lift, has already led to significant positive outcomes for workers and employers, and has great promise to transform the adult education system in Massachusetts and perhaps in other states.
Improving workforce development practices and capacity is the third element of a bold public engagement strategy. It is very clear that this is a unique moment for the workforce development field, but the ability of the field to respond to this moment is limited, and there is little learning and capacity development infrastructure to help respond. For example, if Next Gen workforce organizations hope to build an organizational culture and staff capacity to sell valuable services to employers, they need to learn the methods and skills of for-profit service vendors, including marketing, sales and customer service, integrating those skills into a mission-based organization. “Getting under the tent” means much more than pontificating about what employers should and shouldn’t do. It requires extensive and sophisticated human resources management knowledge and tools so that Next Gen workforce organizations can provide real value for employers and their employees.
The workforce development field suffers from a lack of a sophisticated learning community that can advance market-responsive practice. There are few forums for practitioners to share and learn Next Gen techniques and practices, and those that do exist are often stuck in old school practices. Such a forum would need to incorporate both private sector and nonprofit practitioners, tools and methods.
This economic moment, with historically low unemployment and greater leverage for low-wage workers will not last forever. A downward economic cycle will eventually recur. It is imperative that the workforce field act now, both to take full advantage of our tight labor market, and to build strong practices, employer partnerships and innovative models that can be sustained beyond the inevitable downturn. Our current set of circumstances presents extraordinary opportunities not only for workforce practitioners, but also for those who are interested in investing in and supporting this timely and important work. For too long, public and private investment in workforce development has been limited, sporadic and quixotic. Pilots are the typical approach, with ambitions of scale stated in rhetoric, but rarely in expandable, sustainable financing. Now we have an exceptional opening to leverage the financial resources and equity opportunities that employers have and may be willing to tap to ensure their competitive success. But these opportunities will remain untapped unless the workforce field takes the leap to Next Gen practices, and that leap won’t happen without meaningful change, investment and support.
Workforce organizations will be able to make this leap when they are committed to learning and changing, are well resourced and embrace the four features described in this paper: being market responsive, understanding that all jobs are not the same, knowing their own backyard, and going bold and big. These changes are not easy, and workforce organizations willing to make this leap will benefit greatly from a community of learning, practice and support. JVS is committed to helping build a Next Gen workforce community. We are excited to join with partners in the business community, philanthropy and, of course, practitioners to undertake a range of high-leverage activities such as sharing practices, models, operational elements and policy change through activities like establishing on-site learning academies, writing practice-focused publications, and advocacy.
As we experience one of the strongest and most sustained periods of economic growth and some of the highest levels of income inequality in American history, we find ourselves with a rare opportunity to step up and make a lasting impact. If not now, when?
1. Robert P. Giloth, Workforce Intermediaries For the 21st Century. Temple University Press, 2004.
2. Steven L. Dawson, The Pinkerton Papers: Job Quality Series. The Pinkerton Foundation, 2017.
3. Paul Grogan, “A Tight Labor Market Is a Terrible Thing to Waste,” Boston Globe, March 22, 2017.
Paul Osterman, Professor, MIT Sloan School of Management
The Catapult Initiative aims to reinvigorate workforce programs—efforts aimed at improving the economic prospects of those left behind in the job market—by rethinking delivery systems and relationships with the employer community.
In the first essay (of the series), Jerry Rubin, the CEO of what I believe is the most impressive example of this new thinking in the nation, lays out the basic principles of the “NextGen” design. These key insights include seeing employers as partners and meeting their needs, taking advantage of tight labor markets to push these employer partners to improve job quality, and achieving broader impact by becoming a “player” in regional and national policy setting. Left unsaid, but certainly central, is delivering quality remedial education and training and working effectively with clients to support them as the undertake to improve their circumstances. JVS does this too.
This first essay does an exemplary job of making these points. Nonetheless, as the essay notes, tight labor markets will not persist indefinitely and it seems to me that a key question is how to institutionalize improvement in employer practices and improvements in larger systems so that underlying practices that generate bad labor market outcomes for so many people are transformed. Put differently, when the market turns down will employers still be interested in recruiting new employees from populations that they have ignored in the past? Will they see benefit in maintaining career ladders that enable low wage workers to move up? Similarly, can JVS convince the larger system in which it embedded—notably schools and community colleges—to permanently improve their practices so that there is long-term system wide change at real scale. Answering these questions in the affirmative will require understanding why “bad” practices emerged and why they persisted. And it will require developing tactics to incentivize permanent change. I think that taking these questions seriously and strategizing to answer them in the affirmative is the “Next Gen” agenda of this exemplary organization.