A Tool for Regional Workforce Development

Facilitators

BW Research Partnership, Inc.(BW Research)

Josh WilliamsPresident

Santa Barbara WIB & Express Employment Professionals

Karen DwyerWIB Chair & Business Owner

Part 1: A New Approach to Labor Market Information Introduce a new approach to analyzing your regional or local labor market.

Part 2: What does the Data tell usAbout our 3 tier occupational profile at the national, statewide and regional levels.

Part 3: Implications for Workforce and Economic DevelopmentHow can our 3 tier occupational profile analysis empower decision making to support income mobility.

Session Topics

Part 1

A New Tool for LMI

What Labor Market Information (LMI) do you use?

1. Does it help decide how to invest in WIA programs?

2. Does it help you engage with employers?

3. Does it help you educate job-seekers about the job market?

LMI or Labor Market Information I

Some LMI examples include

1. Unemployment rate

2. Job growth/loss: overall, by industry or by occupation

3. Location Quotient (Industry concentration within a given area)

4. Median Earnings overall or by occupation

LMI or Labor Market Information II

Not all Jobs are Created Equal

Most Labor Market Information spends a lot of time talking about job creation, but understanding the profile of jobs, both new and old is more important.

1. Wages Matter

2. Opportunities for growth and connectivity to career pathways matter

3. Skill and educational requirements matter

4. Connectivity to growing industry clusters matter

Occupational Profile

Tier 1

Three Tier Occupational Profile

Occupations High skill, high wage positions including managers, professional positions & high-skilled technical occupations (programmers, Engineers).

Typical education requirements

Four-year degree or more

Median wage in CA $44.21 an hour or $92k a year

Employment 16% of CAFrom 2004 to 2013 +4.2%

Tier 2

Three Tier Occupational Profile

Occupations Medium skill, medium wage positions including sales, office & administrative occupations, construction & manufacturing positions.

Typical education requirements

More than a high school diploma less than a 4-year degree

Median wage in CA $22.02 an hour or $46k a year

Employment 40% of CAFrom 2004 to 2013 -4.8%

Tier 3

Three Tier Occupational Profile

Occupations Low skill, low wage positions including food service and retail jobs, protective services (security guards) and personal care positions.

Typical education requirements

A high school diploma or less

Median wage in CA $11.39 an hour or $23.7k a year

Employment 34% of CA, from 2004 to 2013 5.4%

Part 2

Data from the Tiered Occupational Analysis

If we look at a three tier occupational profile of the United States going back to the late 1970’s (Autor, 2010. Brookings), Tier 2 jobs (mid wage/mid skill) have been negatively impacted by

1. Technology and ongoing automation

2. Offshoring of “routine” tasks to a developing country

The great recession only catalyzed what has been occurring for 30 plus years

Overall Change in Time

California Occupational Profile

2001 2013 ChangeTier 1 15.6% 16.0%+0.4%Tier 2 43.1% 40.3% -2.8%Tier 3 31.2% 33.9%+2.7%

Regional Occupational Profiles

Regional Ratio of TieTier 1 Tier 2 Tier 3

1 to 3 Ratio

San Francisco 22.9% 34.1% 31.7% 1.38 Santa Clara 21.4% 36.5% 27.2% 1.27 Los Angeles 16.6% 42.2% 33.1% 2.00 CA 16.0% 40.3% 33.9% 2.12 San Diego 15.9% 37.0% 31.5% 1.98 Santa Barbara 14.7% 36.1% 40.0% 2.72 Fresno 11.8% 40.2% 41.4% 3.52 San Bernardino 11.6% 43.3% 35.4% 3.04 Kern 11.4% 39.7% 41.0% 3.60

Regional Recovery (Santa Clara)

Regional Recovery (San Diego)

Regional Recovery (Fresno)

Industry Cluster Profiles (CA)

Tier 1 Tier 2 Tier 31 to 3 Ratio

Life Sciences 44.8% 49.0% 6.1% 0.14 ICT 43.6% 51.5% 4.9% 0.11 Building & Design 36.6% 45.9% 17.5% 0.48 Healthcare 30.4% 34.7% 34.8% 1.14 Aviation & Aerospace 29.9% 63.5% 6.6% 0.22 CA - Overall 16.0% 40.3% 33.9% 2.12 Logistics 11.2% 70.0% 18.8% 1.68 Tourism 4.1% 8.2% 87.8% 21.41

Banking Cluster Profiles (SBC)

Region% of all Banking Occupations

Tier 1 Tier 2 Tier 3

Santa Barbara County 14.8% 78.3% 2.2%

Central Coast 17.3% 72.4% 2.0%

California 19.4% 70.8% 2.6%

United States 17.9% 72.3% 2.9%

Region% Change in Banking from 2007 to 2013

Tier 1 Tier 2 Tier 3

Santa Barbara County -42.7% -40.8% -15.6%

Central Coast -10.9% -15.0% -53.5%

California -15.6% -17.9% -30.0%

United States -9.0% -10.6% -16.5%

Part 3

Implications For Workforce & Economic Development

Changing Occupational Profile Conclusions

1. The changing structure of occupations has had a considerable impact on income distribution in this country and across the developed world.

2. The income inequality issue is further exacerbated by geographic differences in Tier 3, Tier 2 and Tier 1 median wages.

3. Low cost regions have generally lost to high productivity and innovative areas

Income Inequality

Changing Occupational Profile Conclusions

1. Tier 3 occupations generally provide less opportunity for advancement and connectivity to career pathways than Tier 2 or Tier 1 occupations.

2. Tier 1 and Tier 2 occupations are more likely to be employed in industry clusters that have larger employment multipliers, such as Life Sciences, ICT and Aerospace.

Career Pathways & Skill Development

Changing Occupational Profile Conclusions

1. Tier 1 occupational employment generally drives economic development and those occupations that employers have greater difficulty finding qualified applicants.

2. Tier 2 occupational employment tends to have more churn and volatility as it is more connected to industries such as finance/banking, construction and manufacturing.

Industry Clusters Matter

Key Questions

1. Does your workforce development strategies offer opportunities in Tier 1, 2 or 3 employment? If Tier 3 are they connected to reasonable pathways?

2. How are Tier 3 workers developing skills to move into Tier 2 and 1 employment opportunities (underemployment)?

3. What is the relationship between Tier 1 and Tier 2 employment and a given region and what impact has that had on regional recovery from the great recession?

Questions?

Josh WilliamsPresident

BW Research, Inc.2725 Jefferson St. #13, Carlsbad, CA 92008jwilliams@BWResearch.comwww.bwresearch.com

Karen DwyerSanta Barbara WIB Chair & Business Owner

Express Employment Professionals1025 Chapala St. Suite 206, Santa Barbara, CA 93101Karen.Dwyer@ExpressPros.comsantabarbaraca.expresspros.com/

Follow Us