Building a labor force

Virginia to help workers pay for credentials in high-demand professions

Published August 30, 2016 by Richard Foster

One of just a handful of manufacturers of hand-tuned wind chimes left in the U.S., Manassas Park-based QMT Windchimes is seeking an assistant maintenance supervisor.

In fact, Jamie Baisden, the chief executive officer of QMT, has been looking for someone to fill the new position for about 18 months. The problem is he can’t find anyone with the training and skill set to meet the company’s needs.

“We’re not talking about building maintenance; we’re talking about maintenance of our industrial equipment that we use, some of which we design and fabricate and automate using our own equipment, because we have very specific processes we use that don’t exist in industries other than ours,” says Baisden. “We need individuals who are competent with electrical, with pneumatics, with hydraulics … and certified in those types of areas, and they’re very difficult to find.”

Baisden is now considering filling the job with an employee from within the company and helping that person get the necessary training, a task that should be considerably easier thanks to the General Assembly’s passage this year of the New Economy Workforce Credential Grant Program.

As of July 1, the state government will fund two-thirds of the cost of workforce credential programs for students who successfully complete vocational certification programs and earn industry-recognized credentials and certifications. The grants cover 124 different community college training programs in Virginia that lead to certifications for 170 in-demand jobs. Eligible professions range from welding and commercial truck driving to advanced manufacturing, energy, health care, information technology and cybersecurity.

“People see this and they say, ‘Ah, it’s another grant’ or they say it’s just workforce training, but it really is much, much more than that,” says Brett Vassey, president and CEO of the Virginia Manufacturers Association, adding that Virginia has never before invested in workforce credentials for individuals in this way.

Virginia has long offered financial support and scholarships for students pursuing two-year and four-year college degrees but has never really devoted any significant resources to noncredit vocational credentials. “It’s been an afterthought at best,” Vassey says. “This is one of the most important workforce development higher education bills that has been passed in a decade.”

“Higher education is not just about college degrees,” says Wendy Kang, SCHEV’s director of higher education innovation. “We recognize that higher education includes workforce credentials as well as a college degree and that [credentials] are just as meaningful in the marketplace.”

Students pay one-third of the enrollment fee upfront, and the state government reimburses Virginia’s community college system for the rest upon completion. The credentials are stackable, meaning they can build on each other, and are available to anyone who wants to enroll.

“These kinds of professions really offer an alternative [route] to success for the majority who won’t earn a baccalaureate degree and need another way to get family-sustaining wages,” says Elizabeth Creamer, adviser for workforce development in the Virginia Office of the Secretary of Commerce and Trade. “We still have about 35 percent of our high school graduates who don’t go on to any type of secondary education, and there haven’t been sufficient vehicles to train them for jobs that offer them good wages. … We needed workforce training that could be delivered in weeks or months instead of years, as is the case with traditional college instruction.

“The fact that a young person can come out of [high] school and for a third of the cost they used to be facing take a fairly short welding course and get hired … that’s a real victory.”

This new workforce development grant program is “providing a good opportunity for adult education students, for high school graduates, for our veterans” and anyone who wants to pursue a new career path or add to their existing vocational credentials, Creamer says.

The Virginia Board of Workforce Development, an advisory body appointed by the governor and largely made up of business leaders, developed the list of qualifying professional credentials that are eligible for reimbursement.

The certification programs, which do not earn college credit, are taught at Virginia’s state community colleges and higher education centers. Students who don’t complete the programs must pay an additional one-third of the enrollment cost.

The grants program is being overseen by the State Council of Higher Education for Virginia (SCHEV), which also will begin tracking related data such as how many students earn noncredit credentials, in which vocational fields, and the change in their wages after earning credentials. Virginia is believed to be the first state in the nation to begin collecting such data.

Virginia’s program also is the first in the nation to be performance-based, requiring that a student successfully earn the industry credential before the community college can be reimbursed, says Craig Herndon, vice chancellor for workforce development services for the Virginia Community College System (VCCS). This ensures that the community colleges and the individual seeking certification both have motivations to see the program through to a successful conclusion. (Nineteen other states offer reimbursement programs for noncredit vocational credentials.)

So far the General Assembly has allocated $4 million in grant funding for the program’s first year and $8.5 million for its second year.

Because the program is so new, there are no data yet for how many students are participating, let alone successfully earning credentials. And the community college system is still putting together its outreach and marketing plans for the initiative, says Jeffrey Kraus, VCCS assistant vice chancellor for communications.

The legislation for the grant program enjoyed bipartisan support as well as the backing of Gov. Terry McAuliffe. Groups that lobbied in support of it included the Virginia Manufacturers Association (for which Baisden serves as vice chairman), the Virginia Chamber of Commerce and various Virginia electric cooperatives. As the legislation was being crafted, more than 1,500 business leaders across Virginia offered their input on the workforce needs of businesses at a series of 22 statewide town hall meetings sponsored in 2015 by the Virginia Community College System.

A December 2014 JLARC report had stated that Virginia’s workforce development programs were “fragmented, complex and disjointed” and that credential programs that were available were not aligned with the employment needs for businesses regionally and statewide. The report’s major recommendations were adopted in the new legislation.

In 2013 the Virginia Chamber of Commerce issued the results of a survey that found that the most pressing issue of concern among its membership of 25,000 Virginia-based businesses was workforce readiness.

In 2015 Burning Glass Technologies conducted a study for Capital One that showed Virginia had 175,000 vacancies for so-called “middle-skills” jobs — those that require more education than a high school diploma but less than an associate or bachelor’s degree. According to the Virginia Employment Commission, those jobs paid an average $58,000 in annual salary. And it took an average of 26 days to fill each vacancy, resulting in 36 million hours of lost productivity, Creamer says.

Some studies estimate that Virginia will need to fill about 1.2 million new middle-skills jobs during the 2020s, and McAuliffe has set a goal for the Virginia workforce to earn at least 460,000 new high-demand vocational credentials by 2030.
“We know that these jobs, with the right training, can improve our competitiveness” as a state, says Barry DuVal, president and CEO of the Virginia Chamber of Commerce.

Says Kraus, with the community college system: “Increasingly you’ll find economic development professionals will tell you tax breaks are great, new roads are beautiful, but if you don’t have the talent, if we don’t have the pipeline to the talent, we can’t close the deal.”

Workforce credentials, he adds, are “a big deal now.”