Board Information


Final Report to the General Assembly: the Maryland Workforce Development System


I. Background

During the 2003 Maryland legislative session, the General Assembly included language in the Governorís Workforce Investment Board (GWIB) FY 2004 Operating Budget requiring the GWIB to "Identify Inefficiencies within the Stateís Own Workforce Development Delivery System" (full text of the budget language is in the Appendices). An interim report was submitted to the General Assembly on December 31, 2003. This final report provides information on the development of the ten opportunities for improvement that were identified in the interim report.

II. The Mission, Focus, and Structure of the GWIB

The GWIBís mission is to guide a nationally recognized workforce development system that aligns itself with the educational system as primary driver for economic development for the State. The GWIB is the Stateís chief coordinating body on workforce development. The GWIB is composed of 41 members, with 51% coming from business. It is responsible for developing a strategic plan and policies to help forge a coordinated workforce system from a multiplicity of education, employment, and training programs. It brings together and focuses various workforce development partners and stakeholders on an outcome: a properly prepared workforce that will meet the current and future demands of Maryland employers.

III. Partner Agencies on the GWIB

Several partner agencies collaborate with the GWIB and each other to plan and implement the workforce development system in Maryland. The GWIB establishes the vision and principles through the Sub-cabinet. The following partner agencies are members of the GWIB:

  • Department of Human Resources (DHR)
  • Department of Labor, Licensing and Regulation (DLLR)
  • Maryland State Department of Education (MSDE)
  • Maryland Higher Education Commission (MHEC)
  • Department of Business and Economic Development (DBED)
  • Department of Public Safety and Correctional Services (DPSCS)
  • Department of Juvenile Services (DJS)
  • Maryland Department of Aging (Aging)

IV. Marylandís WorkforceóA Key Economic Asset for the State

The quality of Marylandís current and future workforce is vital to the economic future of the state. Marylandís continued economic strength is directly linked to its ability to produce and continuously develop a highly skilled workforce. Not long ago, it did not take a college education or advanced training beyond high school to make a decent living and to meet the demands of the labor market. Today, education and training beyond high school means the difference between subsistence living and family-sustaining careers. A workforce with a higher level of preparation also means the difference between a Maryland economy that lags behind the nation, and one that leads it. Failure to produce the higher skills demanded by growth industries results in an inability to attract and maintain industries that will propel Marylandís economy forward.

In the past few years, Marylandís economy has changed dramatically, and the workforce must keep up with businessí changing needs.

  • Historically, Marylandís major industries were the Federal government, manufacturing, healthcare and financial services. Today, those industries are technology, biotechnology and healthcare.
  • During the early 1990s, the Federal government decreased procurement as well as the civilian Federal workforce in order to help balance the budget. By 2008, one-sixth of the Federal workforce is expected to retire, creating more job opportunities.
  • Between 1990 and 2000, jobs in areas such as national security and international affairs decreased. The events of September 11, 2001, however, saw an increased need for skilled workers in these areas.
  • In the 1990s, hospitals implemented cost containment measures and reduced their workforces. Today, Maryland faces a shortage of more than 5,000 registered nurses. If we fail to address it, that number is predicted to jump to 17,000 in the next ten years. There are similar acute shortages all across the board in healthcare.
  • Both the financial services industry and the manufacturing industries have been major players in the success of Marylandís economy in the past. Recently, the financial services industry has suffered and several large manufacturing plants either closed or downsized, leaving thousands of workers displaced. These workers had been employed in the plants for many years, and the majority of the displaced workers had limited transferable skills or advanced education.

These examples illustrate that the State needs to respond quickly by producing workers that can meet the demand of todayís economy. A major international event, the aging of the population, new scientific breakthroughs, consumer demand, and economic cycles, all play a part in the direction of the economy. Marylandís ability to hold its competitive edge depends on its ability to forge an education and training system that can stay ahead of rapid shifts in demand for new and increased skills. For example:

  • In biotechnology, which has emerged as a growth industry, the Hopkins/UMD biotech corridor in Baltimore City is predicted to need some 8,000 workers over the next 10 years. According to the 2003 MSDE Report Card, Baltimore City high schools have a 54.18% graduation rate. This represents the cumulative effect of a high dropout percentage in grades 9-12. This enormous high school student dropout problem and low graduation rate must be addressed in order to solve the worker shortage.
  • Marylandís construction industry estimates it could hire at least 7,500 workers today, but cannot because applicants lack basic skills, literacy or transportation.

V. Marylandís Workforce Drives Economic Development

Maryland offers a wide array of resources to businesses. Its highly educated workforce and strategic location are extremely attractive to companies looking to either relocate to, or expand in, Maryland. A successful workforce system is demand driven. Today, GWIBís motto is "workforce development is economic development," and businesses cannot expand in, and will not come to Maryland unless there is an available highly skilled workforce.

A significant challenge in Maryland and the rest of the United States is what many term a "skills mismatch." Currently, there are thousands of less educated Maryland job seekers and low-income incumbent workers who want to work or advance in their careers, but do not have the skills or the know how to obtain the skills that businesses demand. With Marylandís unemployment rate (currently 4.0%) approximately one-third below the national average, businesses in many industries are facing significant worker shortages. This will become more problematic as Maryland companies seek to expand.

Many job seekers lack the resources to pursue additional education and training, which would enable them to move into careers that offer benefits and family-sustaining wages. These Maryland residents lack the educational foundation that all businesses look for and increasingly cannot find in applicants. Many Maryland businesses today express concern that a substantial number of high school graduates do not even possess the basic literacy and job readiness skills necessary to succeed in the workplace.

In short, Maryland faces a troubling dichotomy when it comes to its workforce. For example:

  • Maryland ranks first among states in the percentage of people age 25 and older with a bachelorís degree. It ranks second in number of workers with graduate or professional degrees. However, according to the Maryland Association for Adult Community Continuing Education, 20% of Maryland residents function at the lowest literacy levels, putting Maryland toward the bottom of U.S. adult literacy rates.
  • Maryland has one of the lowest poverty rates in the nation but the number of individuals living in poverty increased by 14% between 1990 and 2000.
  • The percentage of Maryland residents age 25 or higher with less than a high school diploma fell from 22 percent to 16 percent between 1990 and 2000. On the other hand, according to the Office of Children, Youth and Familiesí "Maryland Results for Child Well-Being," only 40-50% of children in 3rd, 5th and 8th grades scored even at the satisfactory level in reading and writing.

These statistics are alarming not only from an economic development perspective, but also just as importantly, from a public policy perspective. Both now and in the future, industries across the board face significant skilled worker shortages in areas such as healthcare, manufacturing, construction, transportation, biotechnology, hospitality/tourism and retail, aerospace and digital technology. In addition, what are traditionally thought of as "un-skilled" jobs now require higher-level skill sets. There are also emerging advanced industries such as nano-technology and geospatial technology that need skilled workers. All of this is happening at a time when funding for education and training programs, such as Adult Education and the Department of Business and Economic Development (DBED)ís Partnership for Workforce Quality, are competing with other critical state services. These workforce development needs will continue to place an increased demand on public and private higher education institutions.

VI. Marylandís Workforce Development System

In Maryland, as in other states, Local Workforce Investment Boards (LWIBs) directly provide employment and training services and serve as the primary coordinator for the provision of workforce services in each jurisdiction. These Boards are required to coordinate their services with local Job Service offices, 24 Departments of Social Services, the sixteen community colleges, state operated Rehabilitation services and adult literacy. The local delivery of services and coordination role at the LWIBs is funded almost entirely by the federal government and by some local government contributions. Eight state agencies also oversee components of both federal and state workforce programs for Maryland. The GWIBís role is to ensure that this system is aligned with the economic and educational goals of the State of Maryland that will result in a qualified workforce available to Maryland employers.

The GWIB works towards accomplishing this goal by, among other things, coordinating with its agency partners, making Maryland a cutting edge state when it comes to its workforce system. This coordination encompasses economic development, the K-16 education system, social services, and labor. The GWIB and its agency partners have made great strides over the past few years to meet the needs of business, help incumbent workers upgrade their skills to match the needs of business, and help job seekers get the skills they need to work in industries facing significant shortages. This effort is partly through legislative mandates such as the Workforce Investment Act, the across-the-board support of Marylandís educational system, and the commitment and dedication of workforce and education professionals to develop a seamless workforce system. We must continue to look forward and to view our education system as a vital link to the Stateís economic success.

VII. Recent Successes

The GWIB and its partners are working diligently to close some of the existing gaps and move toward creating a more demand-driven system. The following are some examples of successful workforce partnerships and coordination in Maryland:

  • The Governorís Healthcare Workforce Summit - The GWIB staff brought together representatives from the healthcare industry, government and education as a steering committee to look for ways to address the existing and future healthcare workforce shortages. The steering committee organized and implemented a healthcare summit, held August 28th, 2003 in Annapolis, MD. Nearly 170 participants worked together to develop strategies for solving these looming shortages. The steering committee put together subcommittees responsible for five different strategic approaches:
      1. Attraction and Recruitment Ė Raise the awareness and education of students in middle and high school levels to the opportunities in healthcare careers. Develop a program to reach out to young males to consider health careers.
      2. Retention Ė Build a system approach to create work environments in the industry that compel incumbents to stay and grow professionally.
      3. Capacity and State policy Ė Assure sufficient faculty, classroom, and clinical space to accommodate people seeking credentials for health careers.
      4. Career Development Ė Provide continuous opportunity for incumbent workers to obtain credentials to move throughout the healthcare career ladders.
      5. Military Transition Ė Build bridges for exiting military healthcare workers to obtain additional credentials and careers in the private sector.
    This effort has received significant national attention from the United States Department of Labor. Since the summit, the GWIB has received two grants from the U.S. Department of Labor to 1) create the Maryland Center for Cluster-Based Initiatives and 2) to implement the healthcare strategies to increase the supply of healthcare faculty, and improve the skills and credentials of incumbent healthcare workers in order to increase nurse-teaching faculty. This effort is further described in the "opportunities for improvement" section.
  • Technology Workforce Task Force - At the request of the Sub-cabinet, the GWIB established the Technology Workforce Task Force, which was comprised of representatives from business, education and government. Its purpose was to develop solutions for recruiting and retaining workers in the technology field. In 2003, Governor Ehrlich formed a new Commission to further the work of the Technology Workforce Task Force.
  • Career Connections - The Maryland State Department of Education implemented "Career Connections," a federally funded initiative designed to promote a change in the approach to workforce development as it begins in K-12 education. It advocated a partnership among education, workforce preparation and economic development in order to create a comprehensive system to prepare todayís students for the career and educational opportunities of tomorrow. The initiative sought to expand business input into the curriculum, expand career development, and provide opportunities for students to explore career interests.
  • Performance Incentive Grants Ė Maryland was one of only 16 states in 2002 and the only one in the region to meet all of the performance measures required by the Workforce Investment Act, including measures for Career and Technology Education and Adult Education, thereby qualifying for a $1.9 million incentive grant. The Governor allocated $1 million of this amount for a new incumbent worker training program, called "Maryland Business Works," to support existing Maryland businesses in the retention and growth of their workforce. The program encourages promotion, creates additional job opportunities and improves worker retention by increasing the skill level of the existing workforce. There is a dollar-for-dollar match required by the employer. The remaining $900,000 was allocated to various local public and private workforce projects. Maryland also recently qualified again for another performance grant from DOL.