In 2003, facing a fiscal crisis, continuing erosion of the state’s manufacturing base and rising unemployment, Michigan Gov. Jennifer M. Granholm reached out to nonprofit and philanthropic partners, including the Mott Foundation, to join forces and develop a new economic vision for the state -- one that focused on increasing the skills, education and agility of Michigan’s workforce.
Since its employment peaked in 2000, Michigan has lost more than 282,000 jobs. To attract new businesses and incubate jobs, state officials concentrated their efforts on developing workforce policies that encouraged increased education and skill development as well as support for geographic-based clusters of employers, researchers, universities and design/production capacity to stimulate job creation.
Granholm and David Hollister, then director of the state Department of Labor and Economic Growth, wanted to put together a plan emphasizing three basic strategies: think entrepreneurially, think sectorally, think regionally.
“In many ways, the timing was perfect,” said Larry Good of the state’s decision to revamp its economic development and workforce policies.
Good is president of the Corporation for a Skilled Workforce (CSW), which in partnership with Public Policy Associates Inc. (PPA), was tapped to assist Hollister. Together, they provided a first draft of the state’s workforce development action plan, Reshaping Michigan’s Workforce,which was put into effect in February 2004.
“It was time to re-imagine everything about work and learning,” Good said. “The economic development and workforce preparation policies of today will affect the fate of people over the next 20 years. None of us has a clue as to what the next generation, post-manufacturing economy will look like, but we do know that antiquated public policy models won’t promote economic growth or stimulate job creation.”
The decision to include nonprofit and foundation partners in redeveloping economic and workforce preparation policies made it easier to push experimentation and change, he said. For instance, the Mott Foundation had the ability to bring alternative models and experts from all over the country to Michigan and to inject what it had learned from its grantmaking about innovative workforce strategies into the policy process.
The Flint Healthcare Sector Initiative, developed by the Greater Flint Health Coalition in collaboration with the National Economic Development and Law Center, Flint STRIVE, and other local partners, was one of the model programs that instructed state policy. Initiated in 2002 with $228,220 in Mott funding, the sectoral workforce development project moves low-income people from Flint’s Renewal Community into career track employment with local health-care employers.
In addition to multiyear funding of CSW and PPA, Mott provided challenge dollars that were matched by the state to establish 16 Michigan Regional Skills Alliances (MiRSAs) and training dollars to increase the capacity of the state’s local workforce development boards.
MiRSAs are employer-led, multi-firm partnerships formed around the workforce needs of specific industry sectors such as health care or manufacturing. They also provide a venue through which workers at all levels, including those who have low-wage jobs, can gain skills and climb career ladders within a sector. Currently, there are 25 MiRSAs connecting hundreds of employers with workforce development systems, enabling them to identify common problems and solve them in a more systematic manner, said Jeff Padden, president of PPA.
Workforce development boards, established as part of the Workforce Investment Act of 1998 to determine local workforce direction, can play an influential role in accelerating local economies. Mott funding provided training and technical assistance to help these boards build the leadership needed to integrate workforce development with economic development strategies.
“The public, nonprofit and private partnership to retool Michigan’s workforce policies was in many ways a national model,” Good said. “Foundation dollars allowed for experimentation and brought evidence of what works to policymakers. The state then moved 10-fold the amount of dollars toward some of these initiatives, producing results and accelerating the pace of change.”
Since March 2004, Mott funding for MiRSA’s has leveraged more than $16 million in state and local dollars. “That’s 33:1 leveraging,” said Padden.
The policy development process has begun to attract national attention. Michigan was selected to participate in two policy academies of the National Governors Association and has received a grant from the U.S. Department of Labor to create a state workforce performance measurement system.