11/28/2002: "Texas Needs A New Job Training Program"
The Texas Legislature established the Smart Jobs Fund (SJF) in 1993. Its purpose was to meet employer demand for highly skilled workers. The program was driven by the recognition that future expansion of high-growth technological industries required specialized, skilled workers.
Grants were awarded by SJF directly to employers for customized training with the desire of promoting the creation of new jobs and increasing the wages for existing employees. To obtain funding, employers had to provide at least a 10% match or in-kind contribution, and pay their trainees a higher salary after they completed training.
By 1999 the scope of the program had changed into a more general, broad-based training program designed to serve the needs of all sizes and types of businesses. The selection criteria was also expanded over time as well, encompassing factors (such as training former prison inmates) that, while certainly quite laudable, had little or nothing to do with promoting emerging growth sectors.
In short, the program completely lost its original focus and morphed into something akin to the Skills Development Fund (a general job-training program that is effectively administered by the Texas Workforce Commission) and the Self-Sufficiency Fund (a program to assist in the welfare-to-work transition that is now a part of federal policy). When that happened, the state lost a key part of its attractiveness for desirable site locations. Administrative difficulties further eroded the program, leading to its demise during the last legislative session.
Much of the problem with Smart Jobs was the result of an evolving, and at times, ill-defined missions; others were due to structural factors in its implementation. Additional problems were associated with frequent turnover in personnel. Some were simply bad management at various points in time.
So now that the program is gone, where are we? Although the Skills Development Fund works quite well, in reality, the Lone Star State is left with no effective employer-oriented initiative to support highly skilled occupational requirements.
While the Texas economy has recently outperformed the nation as a whole, the state is slipping in terms of new corporate locations. If the situation persists or deteriorates, future economic performance will be jeopardized. Moreover, the state cannot hope to be a part of the high-tech, high-growth world of the future—which will encompass not only electronics and communications but also biotechnology, alternative energy, nanotechnology, smart materials, and other areas not yet invented—if it cannot offer employers the capabilities of a skilled workforce.
The state’s workforce represents the single biggest potential benefit or threat to economic growth over the decades to come. With a relatively large number of persons in the right age groups, Texas has the opportunity to be the destination of choice for firms in the future. However, the skill level of the potential employee pool is a crucial component. Without proper workforce development, Texas is left with a situation of a growing population and a shrinking number of persons with the proper skills for tomorrow’s jobs.
Current programs leave a gap that a Smart Jobs-type program is needed to fill. Given its history, any new program should probably have a new name and a new administrative home.
Several states have job training programs that are proving highly successful in preparing workers for the future. Among the most effective are those in California, Georgia, Iowa, Michigan, New Jersey, North Carolina, Alabama, and Illinois, just to name a few.
Texas should emulate the best aspects of these states’ programs and create a new workforce training thrust that would substantially enhance overall economic development and prove greatly beneficial in bringing in new industries. Without such a program, the state stands at a significant, perhaps insurmountable, disadvantage in the arena of competition for quality corporate locations.