99 Workforce Development Overview

1999 Workforce Development Assessment

Workforce Development Overview

Key Findings

The Greater Austin Area faces two significant challenges to continued economic prosperity:

Economic: Provide enough skilled workers to support growing businesses and industries

Equity: Provide all individuals with the opportunity to achieve self-sufficiency

By effectively merging economics with equity, our community has a unique opportunity to deal with these two challenges at once.

Opportunity: The thriving economy and the social disparity in Austin contribute to a dynamic workforce environment.

The current demand for workers is balanced by the pressing need for certain disadvantaged segments of the population to find full-time employment that supports self-sufficiency. If barriers to employment can be removed for this segment of workers, Austin businesses will benefit. It is a rare opportunity to meet both the needs of employers and the needs of workers simultaneously.

The most commonly identified barriers that have kept our community from taking advantage of this opportunity are skill deficiencies, lack of affordable and accessible child care, and inadequate transportation. Additional barriers that hinder an individuals chances to become self- sufficient are: disabilities, mental illness, substance abuse, immigration status, and domestic violence.

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Economics

The Austin/Travis County community has often been identified as one of the best places in the country to do business, in no small part due to a highly skilled workforce. After many years of steady job growth however, the supply of skilled workers can no longer keep pace with demand. From 1996 to 1998, the non-farm wage and salary employment increased 5.7% while the Austin-San Marcos MSA population increased only 4.1%.

Along with this growing number of jobs has come greater diversity of jobs. The Texas Workforce Commission (March 1998) reports that "high-tech manufacturing has added some diversity to an economy that is somewhat dependent on government employment& this slight re-distribution of employment is a positive sign that employment volatility in this area is declining" (TWC, 1998).

Source: Texas Workforce Commission (Dec 1998).

As demand for workers has increased, the community has prospered. However, as seen in the chart below, not all individuals in Austin/Travis County have shared equally in this prosperity.

While the unemployment rate is informative, it can be misleading because it does not reflect:

voluntary vs. involuntary part-time workers,

under-employed workers,

discouraged workers, and

workers holding more than one job in order to obtain the income they need to support themselves or their family.

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Source: Texas Workforce Commission (1998).

Demographics

In Travis County, it is estimated that over 80,000 people (12.9% of the population) live in poverty. The characteristics of this poverty population include:

They tend to lack a high school education (18% of all adults over age 25 did not graduate from high school)

They are primarily Hispanic or African-American (69% of all people in Travis County who have less than a 9th grade education are Hispanic or African-American)

Many are in single parent, female-headed households (95% of TANF recipients)

In the future, we can expect that these historically excluded populations will grow.

Sources:U.S. Bureau of the Census, 1990 U.S. Census Data, C90STF3A database; CACI Marketing Systems, Sourcebook America 1998; Texas Education Agency,1997-98 District Profiles; Texas Department of Health, 1998.

While our economy has grown steadily for many years, the percentage of the population living in poverty has remained constant. This persistent poverty level is most clearly seen in the percentage of economically disadvantaged public school students. Over 50% of the students attending Austin Independent School District, the largest school district in Travis County, (over 76,000 total students) are classified as economically disadvantaged. This rate has not changed since 1994. In more rural areas of the county, this percentage is even larger: over 56% in Manor ISD and over 66% in Del Valle. Those families living in poverty are challenged to reach subsistence in an increasingly expensive community. Among the indicators of the rising cost of living in our community are:

The Consumer Price Index increased 6.8% in the last five years

The average rent per square foot increased 68% and the average price of a single family home increased 71% between 1990 and 1998

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Investments

"Preparing the urban work force, and especially inner-city minorities, to attain skilled and professional jobs&will be a key to urban economic vitality in the 21st century and will require new and more creative programs of human resource development and urban investment than those used in the past."¹ Although a complete picture of the communitys investment in workforce development is not available, the table below portrays a snapshot of public investments that total over $36 million. These funds purchase a range of services including childcare and other wrap-around services, Basic Skills education, School to Career programs, job readiness and pre-employment skill development, and higher skills training.

Workforce Development Investments

Funding Agency
Total

Percent

Capital Area Workforce Development Board ¹

$21,453,073

59.50%

City of Austin Direct Services

$6,530,295

18.10%

Austin Community College ²

$3,268,802

9.10%

Travis County Direct Services

$2,830,264

7.80%

Austin/Travis County Mental Health Mental Retardation

$1,249,157

3.50%

United Way / Capital Area

$710,327

2.00%

TOTAL

$36,041,918

1 Capital Area Workforce Development Board funding covers various fiscal years and includes some carryover funds from prior fiscal years.
2 This represents ACC funding only through its business training and continuing education and adult education areas.

Additional investors include State and federal agencies, as well as local non-profit, faith based, and public/private partnerships. These include, but are not limited to:

$8.5million (roughly) in veterans vocational and rehabilitation awards

$7.6million in Smart Jobs funding since 1994 from the Texas Dept. of Commerce

$400,000 (approximately) in Skills Development funding administered by the Texas Workforce Commission

To put this investment in perspective, City, County, and State agencies spend over $78 million annually on health care, Food Stamps, and TANF for low-income residents in Austin/Travis County (1997-98). With careful investment in workforce development, recipients of these services can become self-sufficient, substantially reducing the demand for these and other services.

With economic growth projected to continue, the pressure to provide skilled labor will increase. With this pressure also comes an opportunity there are now, and should continue to be, good jobs available for people with adequate skills. If appropriate training and educational opportunities can be provided and logistical barriers removed, much of todays poverty population can become qualified applicants for good jobs and have the opportunity to achieve self-sufficiency.

Workforce development is a complex system of resources and activities within a community aimed at optimally developing its most valuable resource, its human capital. There are two central components of workforce development:

To foster the economic development of the community

To promote the economic self-sufficiency of individual residents

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Summary

Workforce development is critical to maintaining a strong economy and competitive edge in todays rapidly changing and expanding marketplace. Today, workers must possess a wide variety of skill sets, a level of adaptability previously unknown, and the ability and willingness to learn in order to remain competitive in the job market. Enabling more residents to achieve employment at a living wage. The term "living wage" means a wage

End Notes

1 "The Changing Forces of Urban Economic Development: Globalization and City Competitiveness in the 21st Century" Rondinelli, Johnson, and Kasarda, from Cityscape, Vol. 3, #3, 1998; US Dept. of Housing and Urban Development

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