Governments Sinking Millions Into Training Unemployed Residents for High-paying Jobs

As the pandemic-weary economy continues its recovery, businesses with positions to fill are struggling to hire enough employees, even though many job seekers are unable to find work.

In response, state and city governments are sinking funding—much of it from the $1.9 trillion federal American Rescue Plan Act—into training their unemployed residents for jobs in the industries hardest-hit by the pandemic. In addition, new state programs aim to remove the barriers that might prevent willing workers from taking or keeping jobs.

“The focus is on how [states] can take a greater evidence-based approach to make sure they are putting resources where they’re needed most,” said Rachael Stephens, program director for workforce development and economic policy for the National Governors Association.

That approach has led some states to identify industries with the most critical need for skilled labor in areas whose potential workforces are lacking those skills. In Maine, for example, the State Workforce Board has partnered with community colleges, the University of Maine, private employers and trade unions to train residents for unfilled electrical, plumbing, construction, manufacturing, health care and clean energy jobs.

“Our economic recovery depends on our ability to connect Maine workers to those jobs,” Gov. Janet Mills said in a statement.

Likewise, Montana is plowing $150 million into short-term training for those seeking jobs in high-demand occupations. Massachusetts is devoting up to $50 million to train approximately 15,000 unemployed workers for jobs in manufacturing, health care, information technology and construction.

Others are focusing on training for jobs in hospitality, retail, transportation and warehousing—whose workers were disproportionately affected by Covid-19. According to the U.S. Bureau of Labor Statistics, job losses in those industries more than offset the gains in professional and business services and in education early this year. 

And a $75 million apprenticeship program in Maryland included on-the-job training in higher-paying jobs in industries ranging from gaming to health care and cybersecurity to home improvement.

Other Barriers for Job Seekers

Still, mismatched skills and a lack of training aren’t the only barriers keeping job seekers from filling available positions. Lack of access to technology, transportation, affordable child care and even stable housing can keep capable would-be employees out of the workforce. According to some economists, so can unemployment insurance checks boosted by federally funded enhancements meant to help the jobless keep their families afloat during the pandemic.

So, a handful of states are using grants, governors’ discretionary reserve funds and ARPA dollars to pay jobless residents to stop taking unemployment insurance payments and start jobs. Colorado offered unemployed residents who returned to full-time work a one-time bonus of $1,600. Other states offered from $750 to $1,500 with a variety of caveats. Connecticut workers, for example, had to stay in their new jobs for at least eight weeks to qualify for a $1,000 incentive.

Others, including Arkansas, Missouri and Nebraska, have discontinued extended unemployment benefits and are requiring those accepting payments to prove they are applying for jobs. Employers in several states are asked to report former employees who refuse to take their old jobs back. And Maine, which has extended the extra unemployment compensation until Sept. 4, created an online calculator that helps those collecting unemployment to determine how many hours they can put in at a part-time job without losing their benefits.

Some states are matching job hunters with career coaches, free community college tuition, computers and internet access for remote work. 

Workforce Development Incentives

Some cities are partnering with local nonprofits to get their residents into paying jobs. An ongoing program in Flint, Michigan, for example, offers training and success coaches—and child care, car repair and rental assistance—to the unemployed looking for work. San Antonio pays unemployed trainees $450 a week while they’re bolstering their skills. Some of Chicago’s initiatives target unemployed residents older than 50 and offer digital literacy classes; a 10-week coding bootcamp, with a pipeline to jobs at tech firms looking to hire minority talent; and classes in career planning, interviewing and personal branding.

Key to the infusion of capital into job training and other workforce development programs have been ARPA funds, according to Stephens.

“It absolutely provided a crucial resource to states at a really critical time,” she said, noting that governors had some leeway in deciding how to use the federal funding.

Another key, she said, is an effort to coordinate the back-to-work efforts of state agencies, local governments and the private sector.

“There are partnerships that need to happen across systems and agencies in the state; between state and local [governments and] the private sector and nonprofits,” Stephens said. “That is where you really see the states’ ability to look across the regions in their states to identify priority needs and what assets” will fill those needs.

She pointed to a $100 million Wisconsin program that makes grants to regions and communities in the state for cutting-edge, long-term solutions to lingering workforce challenges created by the pandemic. In Arizona, one of more than two dozen states to discontinue enhanced unemployment insurance payments, a back-to-work program involves a variety of agencies to oversee incentives, childcare assistance, free tuition and housing vouchers.

Putting programs in place won’t do out-of-work residents much good, however, if they don’t know about them. To that end, New Jersey created a job portal where its 1.6 million unemployed can find thousands of openings listed by employers with critical worker shortages. Likewise, Hawaii’s new portal is a one-stop resource for residents on unemployment to find not only jobs but training and other services.

Still, Stephens said, which programs will prove most effective in getting workers into jobs remains to be seen.

“At this point, it’s really early to draw connections between certain investments and people getting back to work,” she said. “There’s no … single bullet … that can do this alone.”