Avoiding Infrastructure Weak: How To Build The Bridges That Matter Most

In two years, the oldest statewide law enforcement agency in North America will turn 200. The Texas Rangers were formed in 1823 when Stephen Austin authorized the employment of “ten men… to act as rangers for the common defense.” A full 50 years older than my beloved Royal Canadian Mounted Police (which, contrary to popular belief, does not require undercover Mounties to compromise their identities by remaining on horseback), the Texas Rangers developed a legendary reputation as the toughest lawmen in the land. During World War II, the German press fearfully reported that the Texas Rangers had invaded France. (It was only the U.S. Army Rangers.) But my favorite Rangers story is when a sheriff of a town lousy with a mob of outlaws telegraphed the Rangers and was told help was coming on the next train. When the train arrived, the sheriff was shocked to see only one Ranger disembark. “Only one Ranger?” the sheriff asked. “Only one mob,” said the Ranger.

These days there’s lots of talk of mobs and trains. With President Trump out of office and subject to another state’s law enforcement, mobs should be in the rearview mirror. But with President Biden’s focus on infrastructure, trains are ahead. The proposed $2 trillion American Jobs Plan aims to spend $80 billion on trains, rebuild 20,000 miles of roads, and repair America’s 10 most economically important bridges. But that’s just for starters. The plan also allocates $100 billion to high-speed broadband, $213 billion to improve the stock of affordable housing, and $400 billion to expand home or community-based healthcare for older and disabled Americans.

While Republicans push to limit the definition of infrastructure to roads, bridges, ports, and airports, Democrats are taking a more expansive view. Cecilia Rouse, Chair of the White House Council of Economic Advisers commented “I couldn’t be going to work if I had to take care of my parents. How is that not infrastructure?” And New York Senator Kirsten Gillibrand Twitter-chanted “Paid leave is infrastructure. Child care is infrastructure. Caregiving is infrastructure,” which led one commentator to continue “Restoring the Habsburg Empire is infrastructure. Making mayonnaise illegal is infrastructure,” and Edutwitter gadfly Preston Cooper to chime in “some politician is going to tweet ‘Student loan forgiveness is infrastructure’ before the day is out and I'm going to have to start drinking by 3pm.”

Somewhere between bridges and mayonnaise, the infrastructure plan also calls for spending $100 billion on “proven workforce development programs.” It calls out three specific elements:

• $40 billion to fund sector-based training for dislocated workers
• $12 billion for underserved populations (underrepresented minorities, formerly incarcerated individuals, and justice-involved youth)
• $48 billion in “workforce development infrastructure”

Which raises the question: what is workforce development infrastructure? Using physical infrastructure as a guide, one approach that could attract the support of Republicans – or, more realistic in the current political environment, conservative Democrats like Joe Manchin – is bridges. Bridges are concrete. But they can also be digital (broadband), or economic. Arguably, economic bridges are the ones that matter most; if they work, Americans can travel on them again and again, generation after generation, crossing to the middle class and beyond. The question is, what kind of economic bridges will we invest in?

***

America has 7.4 million unfilled jobs and tens of millions of people out-of-position relative to the skills specifically listed in these job descriptions. This includes approximately 10 million Covid-displaced workers from the retail, travel, and hospitality sectors. It’s true, as the White House says, that “the United States has underinvested in the workforce development system for decades.” But as philanthropist John Arnold recently pointed out: “it will be a lost opportunity if we channel enormous $ into hospitals, higher ed, job training, research funding, pensions, and infrastructure and don't demand better outcomes from these systems.”

Where is the heavy traffic today? Mostly on toll bridges manned by tweed-wearing collectors: accredited academic institutions that long ago absolved themselves of the responsibility to directly prepare students for jobs. While President Biden wants to eliminate tolls for community college, today's students would much rather pay some tuition for an employment outcome than nothing for no outcome. In terms of innovation, precious little traffic has been diverted from toll bridges to income share agreement bridges; colleges and universities are increasingly looking at ISAs as a supplemental tool for increasing yield. At the same time, every promising pronouncement on ISAs generates knee-jerk reactions from the left, typically involving the phrase “indentured servitude” (because predatory is so last decade).

The federal government has over 40 workforce development programs (job search and/or training) across 12 agencies, but none is doing much to salve our lacerated labor market. At the state and local level, federal WIOA spending of only about $1 billion per year is directed to workforce boards that help job seekers find jobs. While theoretically addressing upskilling and maintaining laundry lists of training programs, workforce boards are measured on speed-to-placement, leading to a vicious circle where employers only list low-skill positions attracting only low-skill workers. And as a recent American Enterprise Institute report revealed, America’s workforce development programs are older than most bridges, designed for a different era when the main challenges were individual transitions and economic shocks rather than digital transformation. At a minimum, building workforce infrastructure should mean repairing these bridges rather than merely trying to fund additional traffic over them (and will mean that, I predict, in order to obtain the requisite political support – unless that support's eyes glaze over at the workforce development section of the bill – after all, the government hasn’t made a good workforce development investment since FDR, and it's only $48 billion).

But if our leaders are doing their jobs, workforce infrastructure will mean building new bridges. Unfortunately, there aren’t a ton of great models to point to and say: we need bridges like this. A new white paper from Joe Fuller’s team at Harvard, in conjunction with New Profit, reviewed 316 “innovative” workforce bridges and found only a handful supporting heavy traffic: the median innovative bridge serves only a few hundred people annually. More damningly, only one-third has direct contact with employers, relatively few track employment outcomes (“the most common success metric tracked… was whether participants completed the program”), and < 3% track long-term career progression.

***

It’s time to build new workforce bridges. From my vantage point, there are four elements to the new bridges that will attract and support meaningful traffic:

1. To avoid building bridges to nowhere, it helps to start with the destination: employment and employers. Far too many legacy and innovative workforce bridges are launched by well-meaning social entrepreneurs from education-land or training-world who couldn’t pick a private sector employer out of a line up (and in most cases, have never worked for one). So bridges need to be employer-centric. Which leads to elements 2, 3, and 4…

2. Bridges should have pre-existing connections with employers. (And I mean more than superficial connections via career services or on-campus recruiting. And preferably directly with hiring managers rather than HR. And the more connected employers, the better.) The bridges most likely to carry heavy traffic won’t be built from scratch.

3. When employers do hire new talent (believe it or not, they do, sometimes), that talent tends to be from “proven” channels (i.e., schools) and have “proven” characteristics (i.e., not diverse). When it comes to considering unproven talent from unproven bridges, repeat buyers at employers (i.e., business or hiring managers, not philanthropic functions) want to try before they buy. It’s absolutely essential in launching and scaling placement from an unproven source.

4. There’s no such thing as a free lunch. Not even for cool Texas Rangers, and particularly not for trying talent before buying. Someone needs to pay for the sourcing, screening, last-mile training, and – assuming we’re not talking about unpaid interns (discriminating against those with the greatest need for these bridges, which puts the mockers on the whole thing) – especially candidate wages. But companies aren’t used to paying for anything of the sort; few if any large American enterprises have an established budget line item for apprenticeships, let alone a novel form of talent acquisition. So bridges must deliver unproven try-before-you-buy talent in a manner consistent with what my partner Aanand Radia calls “payment norms.” For example, companies are used to paying for business services – solutions, projects, consulting, staffing – which explains why companies like this in skill gap sectors are turning their attention to bridges. Tuition-reimbursement as a benefit is another employer payment norm, but only works as a bridge for employees who hit the trifecta of: (1) frontline worker; (2) at employer with max. tuition benefit; (3) connected with programs from Title IV-eligible academic institutions that actually prepare students for jobs. Nonetheless, tuition-benefit leaders like Bright Horizons and Guild are moving in this direction.

Sadly, there’s virtually no intersection between the set of organizations with these elements and the set of legacy workforce development programs + Harvard’s 316 innovative bridges. With a handful of recent exceptions in skill gap sectors like software development, data, healthcare IT, medical devices, and instructional design, the bridges with the greatest promise aren’t being built, and few even think about themselves as being in the bridge business.

But tens of thousands of state and local agencies, nonprofits, and business services and staffing companies have some of these four elements. This is where the American Jobs Plan can help. $100 billion, $48 billion, or even a few billion can go a long way to educate, evangelize, and incentivize these agencies, nonprofits, and business services companies to complete bridges.

Rather than continuing to plow billions into existing programs with sketchy outcomes, why not offer payments to players with some of these elements for when new talent makes it off bridges into good jobs? i.e., full-time, benefits, $50K+ salary, growing industry, multiple career paths. Payment for placement could result in game-changing new investments in sourcing, screening, last-mile training, and mentoring new talent by agencies, nonprofits, and business services companies. Based on current workforce spending per placement into a good job, payments for placement at a comparable level (or half, or a quarter) could result in the establishment of thousands of more effective bridges. We should also stagger payments to ensure would-be bridge builders are incentivized around not only placement but also persistence, and provide bigger bounties for placing (and retaining) socioeconomically disadvantaged candidates, or candidates underrepresented in target industries.

An employer-centric approach, pre-existing connections with employers, allowing employers to try unproven talent before being asked to hire, and adhering to employer payment norms are the pilons and trusses of the economic bridges America must build. The good news is that in the world’s most advanced economy, much of the workforce infrastructure we need is already built; we don't have to build from scratch. In fact, building from scratch is not only a waste of resources and time we don't have, but probably won't work. Forget “shovel-ready.” If we’re serious about building the infrastructure to put America back to work, we need to incentivize players with already-built workforce infrastructure to complete bridges.

Pouring $48 billion or $100 billion into the current workforce system is tantamount to pouring money into irreparably broken bridges: you don't put more money into them; you build new ones. If we define workforce infrastructure correctly, if we try prioritizing employment and employers for a change, and if we leverage the pieces we’ve already got, the resulting workforce infrastructure should persist for decades, just like good roads and bridges. Real workforce development infrastructure may never be as cool as the Texas Rangers, but there’s no reason it can’t become just as legendary.