Amid Worker Shortage, DEED Prioritizes Investment in Employment Training Programs
The Minnesota Department of Employment and Economic Development (DEED) has set aside more than $160 million to fund job training and placement programs in the 2018 fiscal year — an amount exceeding 30 percent of the agency’s $485.4 million budget.
That's on top of the more than $205 million the agency spent on training and employment initiatives, which the agency either runs or funds, in its 2017 fiscal year. By comparison, DEED spent about $116 million each year on similar activities in 2015 and 2016.
The reason for the increase is no mystery: businesses across Minnesota have increasingly been in dire need of skilled workers, a gap the agency has tried to address by funding more than 70 nonprofit organizations across the state that offer employment support services and career training programs.
98,000 unfilled jobs
Today, there are more than 98,000 unfilled jobs across all business sectors in Minnesota, a number that is expected to grow substantially over the next seven years. On top of that, more and more baby boomers continue to age out of the workforce.
“We used to have lots of workers,” said Louis King, president of Summit Academy OIC, a north Minneapolis vocational school that offers career training and job placement programs. “We don’t have them anymore.”
That explains why employers across the state are struggling to find people with the right skills, a need that's especially acute in manufacturing. A recent survey conducted by Enterprise Minnesota found that nearly 70 percent of manufacturing executives said that attracting and retaining employees remains their biggest business challenge.
“It’s incredibly important that there are opportunities out there to provide training,” said state Sen. Jeremy Miller, who chairs the Senate Jobs and Economic Growth Committee, “[and] to make sure that we’re doing our part as a state to ensure our employers meet the need of the current workforce.”
To do so, DEED has secured workforce development funding from both the state and federal governments, money that will go toward expanding career pathway programs that are meant to connect unemployed and underemployed Minnesotans to career training and job placement opportunities.
“One of the main programs is Pathways to Prosperity,” said DEED Commissioner Shawntera Hardy, “which works in partnership with employers and nonprofits that provide wraparound services to help individuals that have barriers to employment.”
Programs created in partnership
The programs DEED funds are often created in partnership between private companies, government agencies and educational institutions — and they’re increasingly becoming more popular in high schools, technical colleges and underserved communities across the state.
The Bloomington School District, for example, offers a career pathway program in which students who are interested in gaining employment skills can earn college credits and land jobs in health care, construction or automotive service industries while still in high school.
Another program, SciTechsperience — offered by the Minnesota High Tech Association to college students pursuing degrees in science, technology, engineering or math — connects students to paid internships at local companies.
The money is also focused on workforce development programs targeting people of color; people with a criminal history; and those who haven’t had the education or skills to thrive in the labor market — especially for the most in-need industries, like manufacturing, construction and health care.
Avivo (formerly known as RESOURCE), which provides career advancement programs, is among dozens of organizations that have received some of the state appropriation. The agency will use the money to connect career training and placement opportunities to people who are undergoing mental health or substance abuse treatments.
“This type of money for the workforce is extremely important to individuals who have not been successful in a traditional education environment and a traditional path to the workforce,” said Kelly Matter, president and CEO of Avivo. “It makes a big difference connecting every eligible worker to employment.”