WIOA State Plan Common Elements

VISION

Under the leadership of the Governor and Secretary for the Labor and Workforce Development Agency, California’s vision for the future of workforce development is centered on the establishment and growth of a High Road workforce system. This High Road system will be focused on meaningful industry engagement and placement of Californians in quality jobs that provide economic security. California is committed to developing a workforce system that enables economic growth and shared prosperity for employers and employees, especially those with barriers to employment, by investing in industry partnerships, job quality, and meaningful skills attainment rather than low wages, contingent employment, and minimal benefits.

Despite positive macroeconomic indicators such as record low unemployment and increasing economic growth as measured by Gross Domestic Product (GDP), key economic trends such as wage stagnation and growing income inequality indicate that not all Californians are benefiting from the state’s bustling economy.

For instance, median hourly earnings for workers in California increased by merely one percent from 1979 to 2018 after adjusting for inflation, while low-wage workers in the 10th percentile of hourly earnings fared only slightly better, experiencing a four percent increase over the same period. As concerning as this trend is at the aggregate level, data further reveals unequal impacts among different populations in California, such as women and people of color. The figures below compare the median hourly earnings of different racial and ethnic groups relative to white workers and of women relative to men, showing marked wage disparity by race, ethnicity, and gender:

Race and ethnicity:

• Hispanic or Latino - 60%
• Black or African-American (non-Hispanic) - 69%
• American Indian/Alaska Native (non-Hispanic) – 75%
• Hawaiian/Pacific Islander (non-Hispanic) - 75%
• Median hourly earnings for workers identifying as Asian are, in the aggregate, 99% of those of white non-Hispanic workers. However, this statistic masks considerable internal heterogeneity within this population, with recent research from the Pew Center finding that income is more widely stratified among Asians than among any other racial or ethnic group in the country.

Gender

• Women - 85%. The disparity is higher at the upper end of the pay scale (81% for women workers in the 90th percentile of earners) and lower at the bottom end of the pay scale (89% for women workers in the 10th percentile of earners).

In regards to income inequality, at the aggregate level, workers in California are realizing a smaller share of the economic gains in the state over the past two decades. The share of California’s state GDP going to income for worker compensation declined from about 53 percent in 2001 to around 47 percent in 2017 while the opposite is true for income going to owners of capital which increased from 41 percent in 2001 to 46 percent in 2017. This trend suggests a loss of workers’ bargaining power relative to employers, which can make a lasting negative impact on California’s economy and workforce.

A similar pattern of inequality appears when looking at average inflation-adjusted incomes for different California households. The bottom quintile of California households saw their average real income decrease from $16,441 in 2006 to $15,562 in 2018, while in the same time period the top five percent of California households experienced a significant increase in average income from $426,851 in 2006 to $506,421 in 2018.

Though median household income also rose from 2006 to 2018, the rate of increase was 6.4 percent, roughly one-third the growth rate for the wealthiest five percent of Californian households. When understood in the context of rising costs of living in California – for housing in particular – the modest and negative growth in average real income means greater difficulty in supporting a family and maintaining a decent quality of life.

These economic trends warrant attention and consideration on the part of the state’s workforce development system given the significant consequences and repercussions throughout California’s economy. Wage stagnation, for example, constrains households’ ability to achieve or maintain a decent standard of living, which could push more and more Californians into poverty and deplete limited public assistance funds. Likewise, the negative effects of income inequality extend beyond a single household or population: research shows that regions that work to reduce inequality experience higher rates of economic growth for longer periods of time, suggesting that greater inequality jeopardizes growth.

With the right combination of thought, policy, and practice – based on principles of job quality, worker voice, equity and inclusion, and environmental sustainability – California’s workforce system can ensure that its programs and resources measurably improve working conditions and economic health in California. At the least, this kind of high road workforce development agenda can avoid repeating and reinforcing existing and systemic problems affecting workers and job-seekers.

California is committed to a high road vision for the state’s workforce development system that embodies the principles of job quality, worker voice, equity, and environmental sustainability. Implementing this vision through policy, programs, and other practices will benefit workers, job-seekers, and industry as well as the state’s workforce development system.

Job Quality

In principle, job quality aims to deliver skills for the state’s high road employers, by building the skills of the existing workforce and bringing new workers to the associated industry sector(s). High road employers provide quality jobs, compete based on the quality of their services and products, invest in a skilled workforce, and engage workers and their representatives in the project of building skills and competitiveness. At a minimum, quality jobs are characterized by: family-supporting wages, benefits, safe working conditions, fair scheduling practices, and career advancement opportunities that are transparent.

In practice, job quality means strategically supporting California’s leading high road employers and connecting individuals to the greatest extent feasible to the best jobs. This includes supporting industry sectors where low-wage jobs are predominant as long as there are high road employers willing to invest in workers’ skills and/or develop career pathways.

Orienting the workforce development system toward job quality serves job seekers and workers by placing them in employment that allows them to sustain a high quality of life for themselves, their families, and broader community that depends on their earnings. It also levels the industry playing field by rewarding employers that follow the rules (e.g., no wage theft or worker misclassification) and compete based on quality and respect for those who help create value.

Lastly, job quality serves the workforce development system and broader public sector by protecting investments in training – i.e., ensuring that money spent on training workers is not lost as a result of turnover, an endemic problem in low-road industries and sectors.

Worker Voice

Worker voice is distinct from, but closely related to, job quality. It begins with a recognition of the wisdom of workers who know their jobs best and by building an industry-driven skills infrastructure where industry means both employers as well as workers and their representatives. By investing in and promoting planning with workers and management at the table, California is supporting partnerships that develop industry-led solutions to critical challenges and opportunities such as:

• Assessing current workforce gaps due to forthcoming retirements, job quality concerns, and/or insufficient training capacity;
• Addressing expected changes as a result of technology deployment including, but not limited to, automation and artificial intelligence; and
• Maintaining or increasing competitiveness in anticipation of, or in response to, market forces such as new laws and regulations as well as global trade effects.
   

Worker voice is also essential to workforce development policy and practice in order to ensure that investments in training and credentialing are connected to meaningful career advancement. In addition to benefitting workers and employers, career advancement is necessary to create opportunities for new, entry-level workers which is the basis for equity and inclusion within the California’s high road vision.

The benefits and impact associated with worker voice are multiple and shared broadly. Workers can experience better working conditions and a greater sense of value and ownership on the job and within the firm by helping to make decisions that affect their livelihoods, both present and in the future. Individual firms and whole industry sectors benefit from development of new standards that can improve consistency in work and training and can support higher productivity. By focusing on developing robust solutions to critical issues identified by the industry, worker voice helps build a culture of continuous learning and collaboration, which is critical as industries change and advance over time.

Decision-makers and the public sector also gain from more widespread practice of joint labor-management planning and partnership, such as improved ability to manage limited resources for enforcement of employment laws (e.g., laws pertaining to wage and hour as well as health and safety) and deeper input and institutional investment in developing safeguards for workers and communities coping with disruption linked to environmental constraints, technological change, and other forces affecting employment, skills, and competitiveness.

Equity

Existing social, economic, and institutional bases of inequality mean that economic outcomes are stratified according to race, ethnicity, disability, and gender. The high road vision and agenda therefore emphasizes equity in workforce development, with the aim of systematically generating greater opportunity for Californians who have been locked out of the mainstream economy, are under-represented in high-wage occupations and industries, and/or face multiple barriers to quality employment.

Equity also means respecting and valuing the work done by immigrants, people of color, and other populations facing marginalization that is often overlooked by workforce development resources. Particularly in industries where low-wage jobs are predominant, equity strategies emphasize upskilling and professionalization that helps to standardize the work and training as well as value and compensate workers for new skills acquired through training and certification.  

A number of practices are required to achieve greater equity in labor market outcomes, including increased partnership with community based organizations (CBOs). CBOs are often grounded in and provide critical resources to marginalized communities which makes them invaluable partners in furthering an equitable high road agenda.

Environmental Sustainability

In addition to job quality, worker voice, and equity, California’s high road vision for workforce development addresses issues pertaining to environmental sustainability, particularly climate change. This is based on a recognition that climate change has serious implications for the state’s economy, and that the impacts of climate change disproportionately impact low-income communities and communities of color.

With respect to economy-wide implications, every occupation and industry – to varying degrees – is impacted by climate change and/or has an effect on the environment and climate. Moreover, California’s transition to a carbon neutral economy is reshaping whole industry sectors, including the occupations and employment within those sectors as well as the knowledge and skills required. Accordingly, high road workforce development – through sector-based high road training partnerships – considers job growth, job loss, and changes in the nature of work associated environmental change and related policies and investments. To this end, special attention must be paid to industry sectors that are on the frontlines of the transition to a carbon neutral economy (e.g., energy generation and distribution, buildings and construction, vehicle and components manufacturing, and forestry services and agriculture) while ensuring that programs and investments continue to address workforce development economy wide.

California will employ three main strategies to operationalize these high road principles, this includes leveraging the state’s power of public investment, establishing policy and providing guidance to the workforce development field, and raising awareness in multiple forums.

Public Investment in High Road

The first strategy is to directly invest funds in CWDB-designed high road workforce development programs and training partnerships. This includes CWDB’s High Road Training Partnerships (HRTP) and High Road Construction Careers (HRCC) initiatives, which together represent $175 million in state investment over the next seven years. These initiatives are shaped and driven by the following essential elements:

• Industry-Led Problem Solving: Foundational is that the industry – including leaders representing both employers and workers – lead the problem solving for the workforce demands unique to that industry.
• Partnerships as a Priority: It is key to have strong and durable industry partnership as a goal in and of itself. Here it means a formal relationship that is neither loose nor ad hoc, but forms the basis of sustained problem-solving.
• Worker Wisdom: Existing HRTPs in California have developed innovative ways to explicitly bring worker voice into their strategies and tactics as a core value undergirding the partnership.
• Industry-Driven Education & Training Solutions: Partnerships can tap into training that already exists, develop and deliver their own programs, or use a hybrid approach specific to their particular workforce needs.
   

Additionally, CWDB is providing technical assistance to other California state agencies to support integration of high road workforce development in those agencies’ major investments that have significant effects on employment and training needs across industry sectors. This includes, but is not limited to, agencies responsible for state building construction and maintenance; energy, transportation, and water infrastructure development and operations; and for reducing pollution from major industrial and agricultural sources. Potential state agency partners may include the California Air Resources Board, California Energy Commission, California Public Utilities Commission, California Natural Resources Agency, California State Transportation Agency, and the California Department of General Services.

Development of High Road Policy

The second strategy emphasizes policy making as a means to establish measures either mandating or encouraging that high road practices are implemented and meaningful outcomes are achieved. In practice, CWDB translates high road principles and practices in state legislation and regulations, as well as developing policy directives and guidance for public agencies and the local workforce development system.

Increasing Education and Awareness of High Road

The CWDB advances the high road vision through education – by raising awareness of high road principles, practices, and programmatic successes – in order to change the culture of workforce development statewide. This is done through presentations at conferences on labor, workforce development, and education; regular and deep communication with, and technical assistance provided to local practitioners; and producing reports and other educational materials for the diverse workforce development field in California.

The High Road model will only be successful system wide if it involves ongoing and meaningful engagement with adult education, vocational rehabilitation, wagner peyser and other WIOA program partners. California’s vision for utilizing deep industry engagement and strategic upskilling to place individuals with barriers to employment into high quality career pathways applies across the board to all of our shared customers – people with disabilities, formerly incarcerated, veterans, immigrants and refugees, foster youth, etc. The High Road model requires a universal design and CWDB is dedicated to working with the California Department of Education, California Department of Rehabilitation, Employment Development Department and other state program partners to ensure that the funding, policy guidance, or technical assistance strategies outlined above are developed in a manner that meets the unique needs of everyone that the workforce development system is intended to serve.

GOALS

California intends to use the high road workforce development agenda identified above, to advance progress on three main goals, which this plan will refer to as policy objectives. These objectives affect both state-level policy and administrative practices across programs as well as local policy and service delivery.

• Fostering demand-driven skills attainment: Workforce and education programs need to align program content with the state’s industry sector needs so as to provide California’s employers and businesses with the skilled workforce necessary to compete in the global economy.
• Enabling upward mobility for all Californians: Workforce and education programs need to be accessible for all Californians, especially populations with barriers to employment, and ensure that everyone has access to a marketable set of skills, and is able to access the level of education necessary to get a good job that ensures both long-term economic self-sufficiency and economic security.
• Aligning, coordinating, and integrating programs and services: Workforce and education programs must economize limited resources to achieve scale and impact, while also providing the right services to clients, based on each client’s particular and potentially unique needs, including any needs for skills-development.

California recognizes the critical importance of improving the workforce and education system’ ability to meet the skill demands of employers in industry sectors that are driving regional employment. This includes identifying opportunities to move workers up a career ladder using targeted incumbent worker training while also moving new hires into jobs using strong employer engagement practices, relevant training investments, and supportive services.

Governor Newsom has set an aspirational goal of 500,000 apprenticeships in California by 2029.  To reach the goal, the state must re-examine how state-approved apprenticeships are developed, approved, and executed, and must ensure that employers, apprenticeship training providers, and the workforce system are aligned. It is important to note that an apprenticeship is a job, therefore, to create an apprenticeship an employer must be willing to hire, and then train a worker in a structured program while also paying living wages. While federal and state funds can cover some of the expenses for establishing new earn-and-learn opportunities, the costs of on-the-job training (in non-construction apprenticeship training) are primarily borne by the employer in the form of wages paid. Therefore, any effective strategy for scaling apprenticeship must put industry at the center.

California will continue to invest in existing successful programs that have achieved a co-equal and successful labor-management approach in order to scale them up, while also creating new programs that involve meaningful partnerships between employers, workers, and the workforce system that treat each partner fairly.

California believes that diversity is a strength, and advancing equity is an economic and moral imperative. Creating a workforce and education system that provides upward mobility for all Californians benefits the economy and fulfills the state’s promise to recognize the ability of everyone who lives here to participate and thrive. In order to ensure that everyone has access to a marketable set of skills and the level of training necessary to get a job that provides long-term economic security, the services provided must be centered on each individual’s unique needs.

For some individuals served by the workforce system, especially dislocated workers with an in-demand skillset, finding a good job may require only access to information about which employers are hiring in their Local Area or region. However, California recognizes that individuals with significant barriers to employment may need multiple interventions and access to a variety of services provided over an extended period of time in order to find and enter a good job. In alignment with the Governor’s priorities, California will continue to support the provision of wraparound services for individuals with barriers to employment, with an increased emphasis on the following populations.

Immigrants

Immigrants, regardless of status, contribute significantly to California’s robust and growing economy. Immigrant comprise over one third of California’s workforce and undocumented immigrants represent one in ten of California’s workers. However, immigrants are particularly susceptible to forces barring them from economic opportunity. Common barriers include language access, childcare and transportation services, work authorization requirements, and the cultural competency of staff. Consequently the state workforce and education system must acknowledge, value and invest in the full potential of the immigrant community by expanding investments in education, workforce, and supportive services that are open to everyone, regardless of status.

Justice-Involved

California releases approximately 36,000 people from the state prison each year, a portion of whom have received in-prison job-training rehabilitative services. Individuals involved with the justice system face significant barriers obtaining economic mobility and can benefit from increased collaboration between the education, training, workforce development, and community-based systems to enhance reentry employment opportunities. While there is some, often informal, coordination between the corrections and workforce system, a formal and sustained relationship is needed to better integrate services operating in isolation, and to fill gaps and provide holistic and long-term outcomes to reduce recidivism.

Homeless or Housing-Insecure

California is facing a homelessness epidemic across the state. According to the 2019 Homeless Point in Time count, more than half of the 44 Homeless Continuum of Care (CoC) in the state reported double-digit increases in the number of people experiencing homelessness. While additional state resources have been allocated to stem the increase in homelessness, opportunities to deliver a comprehensive cross-system response remain. For people experiencing or at risk of homelessness, creating a continuity of services between workforce and CoC programs could provide the critical link necessary for long-term stability and success.

Youth

The California unemployment rate in 2019 among youth ages 16 to 24 was more than double the overall rate at 9.1 percent. For youth with multiple barriers to employment, this puts them at even greater risk of poverty and widening income inequality. Culturally competent interventions, trauma-informed care, and a whole-person or family approach to system alignment across all safety-net programs, presents a clear opportunity for effectively reducing disparities among youth. Additionally, systems of care must be responsive to the diverse emotional, psychosocial, and behavioral needs of youth, especially those who have interacted with multiple systems in order to increase the likelihood of positive employment outcomes and to effectively tackle generational poverty.

California is experiencing fundamental shifts as a result of rapid advancements in technology along with the demands of combatting climate change. This has prompted California to reimagine how government can align its workforce and training programs at the state level to economize limited resources and creating a pipeline of qualified workers for the jobs of the future.

Governor Newsom is engaged in collaborative conversations with the Legislature and other state leaders on a proposal to better align workforce services and training programs though the establishment of a new department centered on the following standards:

• Equity – Despite productivity gains and increased prosperity over the last 40 years, we have also witnessed a steady deterioration of job quality and an abiding sense of economic insecurity. We can help shape the future of work in a proactive way, formulating new policies for connecting workers, students, and jobseekers – regardless of race, gender, disability, economic background, or prior education - with a chance at reskilling, upskilling, and training for something better.
   
• Efficiency – Workforce development programs are currently too fragmented across state government and reactive in nature to achieve sufficient scale and impact. Bringing current resources, programs, and training together in a well-coordinated system will enhance their impact. The plan calls for unifying these four organizations under one proactive vision:
  • • California Workforce Development Board
    • Employment Development Department’s Workforce Services Branch
    • Employment Training Panel
    • Department of Industrial Relations Division of Apprenticeship Standards
       
• Customer Service – Both job seekers and employers today face a system of services that can be time-consuming and difficult to navigate. The proposed new department would be intended to benefit all by actively engaging employers big and small, expanding apprenticeship opportunities, and creating easy-to-navigate job seeker assistance among other innovative workforce approaches.

ASSESSMENT

The Cross-Systems Analytics and Assessment for Learning and Skills Attainment (CAAL-Skills) program serves as the main tool for assessing the overall effectiveness of the state workforce development system. CAAL-Skills is an interagency and multi-departmental data-sharing and program-evaluation initiative led by CWDB that utilizes the common performance measures to evaluate the outcomes associated with California’s investment in workforce development, training, related education and supportive service programs.

Current data sharing partners include:

• Department of Industrial Relations-Division of Apprenticeship Standards
• Community Colleges Chancellor’s Office
• Employment Training Panel
• Department of Social Services
• Employment Development Department
• Department of Education
• Department of Corrections and Rehabilitation
• Department of Rehabilitation
• Pilot counties

The data system includes participant-level information that is used to systematically link individuals across the workforce system and participating programs. The program has developed a pooled administrative data set which can also be used to evaluate and assess participating programs’ efficacy so that program administrators and policymakers can develop evidence-based and data-driven policies to improve program participant outcomes.

For each program in the CAAL-Skills database, participant data is collected on the following variables:

• Participant characteristics, including demographic information (age, gender, race, ethnicity); veteran status; and existence of employment barriers (disabilities; cultural, linguistic, literacy or income barriers; and ex-offender status).
• Treatment(s) received: type of service (whether career, training, or supportive; and by within-category disaggregation) and whether the participant received a combination of services. 
• Location(s) where service(s) were received.
• Time of program entry, exit, and (if applicable) training completion.
• Whether a participant obtained a recognized credential(s) within one year of exit, and type(s) of credential obtained.

Participant data is then associated to employer-provided data in the Unemployment Insurance base wage file, to generate additional information on participant outcomes, including:

• Participant employment status two and four quarters after program exit.
• Participant earnings two and four quarters after program exit.
• The industry sector in which that participant was employed, two and four quarters after exit.

The pooling of participant data among the data-sharing partners also provides information on the frequency, extent, and patterns of participation in multiple workforce education and training programs.

Finally, availability of pre-treatment earning information is expected to provide a more rigorous baseline with which to assess changes to earnings following workforce program participation.

The CWDB has engaged the University of California Regents (working under the name of California Policy Lab) to perform a statistically rigorous evaluation and assessment of California’s workforce system partners as required by WIOA Section 116.

The California Policy Lab evaluation will use data in the CAAL-Skills database to assess if and how particular workforce programs and services are associated with improvements in labor market outcomes. The non-experimental evaluation will utilize methods of control to rigorously estimate impacts from program participation itself, eliminating or reducing the effect of confounding factors (such as unmeasured differences between participants). The evaluation may additionally reveal whether impacts differ for different participant groups (e.g. by gender, race, disability etc.), which may provide information on the effectiveness of the workforce system in reducing or eliminating barriers.

Using CAAL-Skills data and associated evaluations, the state will assess the extent to which specific workforce programs and services mitigate such inequalities (or fail to), and identify the specific barriers to access, completion, or success, that participants face, in addition to evaluating performance on statewide measures in WIOA Section 116.

Besides the current and ongoing assessment efforts outlined above, California will explore ways to objectively assess implementation of its High Road workforce development agenda.

Potential indicators of success or measurements of progress could include, but are not limited to, the following:

• California’s capacity to grow sector-based, high road training partnerships - Evaluation criteria could focus on measurable outcomes for workers. Examples include: retention, wage progression, job quality; for employers (productivity gains, reduction in turnover); and durability and scalability of partnerships themselves.

• California’s impact on industry standards - Evaluation criteria could focus on positive within-industry changes that result from expansion of the high road model within an industry. Examples include: growth in prevailing wage levels and improvements to scheduling predictability, benefits, safety standards, etc.
• California’s ability to improve equity through participant outcomes - Evaluation criteria could focus on investment in retraining and creation of meaningful career pathways for workers who are currently employed in sectors which produce environmental pollution as well as for low income communities and communities of color that are disproportionately impacted by the effects of climate change. Examples include: training and job placement benchmarks for persons of color, people with disabilities, immigrants, and refugees.