Hi. I'm Chevelle Wilson with the Federal Reserve Bank of Atlanta. Today I'm speaking with Todd Greene who is the vice president of the Community and Economic Development function here. Todd also leads the [Federal Reserve] System's workforce development working group. We will discuss a new initiative entitled Investing in America's Workforce: Improving Outcomes for Workers and Employers. Welcome, Todd.

Thank you, Chevelle.

So what is the Investing in America's Workforce initiative?

Thank you for asking that question, Chevelle. It's a two-year initiative at the Federal Reserve as well as with our partners, an opportunity to look at reframing the workforce development conversation to really think about [it] in terms of investments. Heretofore, we've been thinking about workforce efforts in terms of the cost to the worker. How much does it cost me to pursue this certification or this credential or this college degree, and what are the returns associated with that? We also think about the cost, too, of these workforce development programs. And then, the other kind of costs that we think about is the cost to employers. So what are the costs associated with them hiring or making sure that they have a properly trained workforce? So we're attempting to reframe the conversation into one of an investment instead. That allows us to think about what are the returns. So as part of this initiative, we've been in over 50 cities across the country understanding and listening to workforce developers, industry, [and] a broad array of stakeholders — and understanding what are the opportunities, what are the challenges associated in thinking about [an] investing framework. ¬≠The next component is that we'll have a conference — a national conference [on October 4–6, 2017] in Austin, TX, where we'll further explore these concepts. And then, finally, we'll have a publication that will come out next year where we have a broad range of stakeholders also involved who'll be presenting essays about various components of the workforce development process and helping to reframe some of these familiar concepts, but reframe them in a way that really focuses on the return to make sure that we are being efficient and effective in terms of how we're addressing our workforce development needs.

Right. Exciting. Now, who are the partners involved with this?

We're fortunate to have all 12 Federal Reserve banks as well as [the] Board of Governors [of the Federal Reserve System] participate in this effort and partnership. But we also have some other partners who are bringing some exciting new perspectives to the work that we're doing. They include the [John J.] Heldrich Center for Workforce Development at Rutgers University, the Ray Marshall Center for [the Study of] Human Resources at the University of Texas, as well as the W.E. Upjohn Institute for Employment Research.

Great. Now, one might ask why is the Federal Reserve involved in this?

The Federal Reserve Bank has really been involved in thinking about workforce development specifically, for about the last seven or eight years or so in — to a high degree of engagement within our community development function. Back during the Great Recession, we identified that [there] were several paradoxes, or at least there was one main paradox, that confounded us when we began to think about our labor market. So, for example, we experienced a very high level of unemployment, but yet when we engaged employers, they shared with us that they were having challenges finding skilled workers or people who would be — have the requisite skills to enter into those jobs. So that really led us to this identification of the workforce development system as a prime opportunity for making sure that our employers were able to receive the types of employees that they needed. So over the course of time, we identified that there were, in some cases, inefficiencies, as I mentioned earlier, with the workforce development system, but we also identified mismatches in terms of what communities were training for versus what the employers needed. So that creates challenges for employers, but it also creates challenges for the job seeker.

I know that one element of the initiative is focused on creating good jobs. Why is this a part of the effort?

Yes. When we think of good jobs, we think of jobs that are paying a wage that is consistent with a person being able to live in that local community, but we also think about benefits. Paid time off, for example, is one that is typically associated with a good job. But we know that communities are investing — states and localities are investing a fair amount of resources engaged in recruiting businesses to their local area but also in retaining businesses. And we want to make sure that the workforce development system is aligned to supporting those types of investments but also ones that are focused on jobs that are really going to be beneficial in the long run to the community. So every job is not created equal, and we know that we need to have a spectrum of jobs within any community, but we also know that workers are very much interested in making sure that they have a job that perhaps has a pathway for advancement and that can allow them to continue to learn.

Now, do banks' responsibilities under the Community Reinvestment Act involve workforce development?

Well, Chevelle, that's really a great question. We have — most people don't think about banks participating in the workforce development process, and, in fact, that very much is a new aspect. The Community Reinvestment Act is a law that was passed decades ago that requires financial institutions to engage in certain community development activities within their areas that they serve, particularly to help low- and moderate-income populations. And so, through the years, there's been a lot of interpretations of what that act does as our economy has changed. And we're very fortunate that, most recently, through interagency guidance, we've had more clarification about how that act can actually support activities that surround workforce development. So this is a new opportunity — a relatively new opportunity to think about new partnerships. But beyond financial institutions, philanthropies and lots of other entities are now beginning to realize that, in order to improve communities, the very foundation is a good job. So that means banks and others are really looking at how it benefits them, and also, of course, communities are thinking of that as well.

So it sounds like there [are] a lot of players involved. How exactly will the Investing in America's Workforce initiative affect workforce development practitioners, employers, foundations, or other groups?

Yes. Within the workforce development ecosystem, we know that it starts with the worker, and it also ends on the other end with the employer. But in between, there are a number of actors and [we are] making sure that all of the actors are thinking about it in a similar way. So we think that having an investing overlay across this really helps each of the entities to understand where they fit in to this whole spectrum, and it also helps to create a common dialogue or at least an opportunity for each of those entities to really understand we all want a return on an investment. And if there's a common way that we can think about this, then perhaps there's an ability for the policies and the practices to really line up better in order to create a better outcome.

My next question is why now? Why is this the appropriate time to convene?

That's an important question about the timing. Well, if you think about today's economy where we have a very tight labor market, that means that employers are having challenges — even greater challenges in finding the talent that they need. So that means our workforce development system has to work harder. Unfortunately, a lot of our federal investments in workforce development have declined over the last 20 or 30 years. But when we think about the pace of technological change, for example, and the dynamic economy in which we find ourselves, we know that workers keeping up with their skills — that creates even more of a challenge with these kind of global factors that we are experiencing. So to make sure that our companies — our employers can remain competitive and that our economy functions properly, we need to make sure that we have everything right. We also know that with having fewer available workers, with demographic factors like the aging workforce, for example, that employers are going to have to really work harder in thinking about engaging those people who perhaps have barriers or who are harder to employ. And we know that in order for them to become engaged in the workforce we need to re-double our support or rethink about ways to get people engaged in the workforce development system that may be outside of the traditional way that we've approached it so far.

So the community development offices at the Fed have been conducting research on workforce issues. Can you share some of the highlights of that research?

Sure. It would take me forever. We'd be here forever discussing all of the work that is being done across the Federal Reserve System and when we think about issues that impact workers and workforce development. But I'll just mention a few research opportunities that have come along the way. In [the] Boston Fed, they've been very involved in what we call working cities, and they've been thinking or helping those communities to think through how they transition from former traditional economies into more modern ones and what that means for the workforce. [The] Richmond Fed has been engaged in working with watermen in the Chesapeake Bay area and understanding the changes and the needs of that particular workforce occupation. But in addition to that, [the] Board of Governors in Washington, D.C., has been looking at young workers and what are some of the factors that impact young workers in terms of their engagement in the workforce. [The] San Francisco Reserve Bank has been looking at issues related to those who are underemployed and those people who are working perhaps part time but who wish to work full time. And so what are some of the workforce development opportunities or engagements associated with that? We've had other Reserve Banks [that] are engaged with community colleges, and we've had others [that] are looking at opportunity occupations. Those are occupations that pay above the median income for a particular metropolitan area and yet don't require a college degree. Those are just a few examples, and, as I mentioned, I can really go on and on. But certainly, I would encourage others to take a look at the resources that we have in the Federal Reserve. They really are tremendous.

Great. Well, this sounds like an awesome initiative and lots of opportunities involved. So thank you for sharing with us today.

Thank you. It's my pleasure.

The views expressed here do not necessarily represent the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.