Call to Order and Roll Call
TheProgram Review and Investigations Committee met on Thursday, September 9, 2010, at 10:00 AM, in Room 131 of the Capitol Annex. Representative Kelly Flood, Chair, called the meeting to order, and the secretary called the roll.
Members:Senator John Schickel, Co-Chair; Representative Kelly Flood, Co-Chair; Senators Jimmy Higdon, Vernie McGaha, R.J. Palmer II, Joey Pendleton, Dan "Malano" Seum, and Katie Kratz Stine; Representatives Dwight D. Butler, Terry Mills, David Osborne, Rick Rand, and Arnold Simpson.
Guests: Beth Brinly, Commissioner, Department of Workforce Investment; Tom West, Executive Director, Kentucky Workforce Investment Board; Education and Workforce Development Cabinet. Juanita Shackelford, Coordinator, Senior Community Service Employment Program, Department for Aging and Independent Living, Cabinet for Health and Family Services. Patrice Blanchard, Associate State Director, AARP Kentucky.
LRC Staff: Greg Hager, Committee Staff Administrator; Rick Graycarek; Christopher Hall; Colleen Kennedy; Van Knowles; Lora Littleton; Sarah Spaulding; Cindy Upton; Stella Mountain, Committee Assistant.
Approve Minutes for July 8, 2010 and August 17, 2010
Upon motion made by Senator Schickel and seconded by Representative Mills, the minutes of the July 8, 2010 and August 17, 2010 meetings were approved by voice vote, without objection.
Staff Report: Workforce Development Options Targeted to Older Kentuckians Are Limited
Rick Graycarek presented the report. For the report, older workers are defined as those who are 55 and older. Workforce development is defined as training or education programs that can help improve the skills or employability of older workers who are actively seeking to enter or who are currently participating in the workforce.
The first of the report’s seven conclusions is that an increasing number of Kentuckians are 55 and older. More than 1 million Kentuckians are 55 or older, which represents a higher than average percentage of the population compared to other states. Kentucky’s older population is growing slightly faster than average.
Americans 55 and older represent the fastest growing segment of the national workforce. By 2018, the number of older workers is expected to increase by 43 percent. The trend for younger workers is relatively flat. The percentage of the population that is older varies among Kentucky counties, ranging from less than 16 percent to more than 30 percent.
The second conclusion is that a lower percentage of older Kentuckians are employed than in most other states. Fifty-two percent of Kentuckians aged 55 to 64 are employed, well below the national average of 61 percent and tied for last among states.
The third conclusion is that older workers have distinct workforce needs. In general, they are less familiar with computer technology, have outdated workplace skills, remain unemployed longer, have less access to transportation, and are less educated.
The fourth conclusion is that of the 13 state or federally funded programs examined in the report, only one is targeted to older workers. The Senior Community Service Employment Program (SCSEP) provides work-based training to unemployed low-income adults who are 55 and older. As of March 2010, there were 1,077 participants statewide. He summarized the 13 programs, of which 4 are funded by the state, 4 are funded by the federal government, and 5 are jointly funded by the federal and state governments. The programs with the most older participants are adult education (2,293) and SCSEP (1,077).
In response to a question from Representative Flood, Mr. Graycarek said that staff did not find any information that addressed the reason why some states have a higher percentage of older workers employed. However, it appears that the states with the highest percentages of older residents who are employed are Northern agricultural states. States with the lowest percentages, such as Kentucky, may have fewer educational and employment opportunities.
Mr. Graycarek said the Workforce Investment Act (WIA) is a federal law that provides a national framework for workforce development. Among its provisions are ending a requirement to fund services specifically for older workers. Services under the Act are administered through local workforce investment areas, of which Kentucky has 10. Each area is governed by a local workforce investment board (LWIB) that oversees the administration of WIA programs and ensures that programs and services are found for employers and employees. A majority of board members must be business people; other members include local elected officials and education representatives. One-stop career centers, at least one of which is located in each local workforce investment area, are required by WIA. Training services under WIA are provided by businesses and nonprofit organizations, including educational institutions, which must be approved by a LWIB to become “eligible providers.” To access services by an eligible provider, WIA participants get an individual training account that is used to pay eligible providers for training. Participants should be able to access services from any eligible provider. In practice, choice appears limited and varies among the local workforce investment areas. Recommendation 2.1 is that the Department for Workforce Investment should evaluate the policies and procedures of local workforce investment boards as they relate to WIA participants’ access to training services provided by eligible providers.
The fifth conclusion is that it is unknown how many older Kentuckians participate in some workforce development programs. For 6 of the 13 programs, including 3 of 4 state-funded programs examined in this report, the number of participants who were older was unknown. Some programs do not record the age of participants. If age is recorded, some programs do not track which services participants received.
The sixth conclusion is that coordination of state programs appears to be good. The 42-member Kentucky Workforce Investment Board coordinates state workforce development policies. The strategic plan adopted by the board in May 2010 addresses many issues, including some deficiencies identified by Program Review staff during the course of this study. Regional coordination also appears to be good.
The final conclusion is that private sector programs targeted to older workers appear to be uncommon. Typically, training by businesses and unions to help improve workers’ skills by providing on-site or apprenticeship training are not age dependent.
Workforce development for older Kentuckians could be improved by adapting computer training to their needs, providing shorter-term training, expanding awareness of training programs, and improving transportation services. Recommendation 4.1 is that the Kentucky Workforce Investment Board should evaluate the benefits and costs of providing additional services to older workers.
In response to questions from Representative Simpson, Mr. Graycarek said that performance measures exist but not specifically for services provided to older workers. The Education and Workforce Development Cabinet could provide information on the existing measures.
In response to questions from Senator Stine, Mr. Graycarek said that staff did not identify any public-private partnerships in the course of the study but that local workforce investment boards do have business people as board members. He did not know whether any of the board members were from the computing industry. The Kentucky Workforce Investment Board’s strategic plan was not included in the Program Review report but it is publicly available. He noted that outreach to older workers varies by the type of program. Most programs are at capacity so there is little need to market programs now.
Senator Stine commented that computer training is important and that there is a College of Informatics at Northern Kentucky University.
Beth Brinly, Commissioner of the Department of Workforce Investment, Education and Workforce Development Cabinet, responded to the report. She said the report was valuable as an overview of the demographics of older workers in Kentucky and the workforce development programs that are available to them.
Ms. Brinly gave an example of how BMW in Germany made minor adjustments in the workplace for older workers at a minimal cost and decreased absenteeism, increased productivity and saw a zero error rate.
The Kentucky Workforce Investment Board adopted a new strategic plan in May 2010. Action Step 6 calls for an overhaul of the Eligible Training Provider List process and eligibility criteria to reinforce priorities around high demand occupations, sustainable wages, and career ladder goals. The implementation of this action step will address Recommendation 2.1 and issues raised in the report. The Department would gladly provide an update to the committee once the action step is completed.
Kentucky has exceeded its performance measures set with the federal government for 7 of the past 10 years. As a result, Kentucky received almost $10 million in additional resources to be able to provide incentive funds. The “Know How To Go” Web site was recently launched. The site identifies education and training programs offered in Kentucky and how to access them.
Among the initiatives within the strategic plan that will benefit older workers is Incumbent Worker Training. Workers are trained in skills needed as companies advance in technologies and become more efficient. Kentucky is one of the leaders in providing this kind of training.
Tom West, Executive Director of the Kentucky Workforce Investment Board, Education and Workforce Development Cabinet, responded to the report. He noted that Senator Higdon has recently been appointed to the Kentucky Workforce Investment Board. The board has been involved with the topic of older workers for some time. For example, the Institute for Workplace Innovation at the University of Kentucky held an aging workforce forum in May and its study will address the needs of workers and employers. Positive characteristics of the older workforce that businesses find appealing are lower absentee rates, longer terms of employment, more company loyalty, and a strong work ethic.
A challenge is that local workforce areas are partially funded based on meeting federally prescribed performance measures, particularly placements in full-time positions and wages. Many older workers want part-time work and those who receive Social Security benefits cannot exceed a certain income. Another challenge is to provide services to all Kentuckians when they need those services. Rather than setting up new programs, they are forming partnerships within the public and private sector.
The major goals of the strategic plan are to align education, economic development and workforce at a state and local level, simplify the system, and create a culture of customer-centered service delivery. A holistic approach will integrate understanding of older workers in action items such as sector strategies.
In response to a question from Representative Flood, Mr. West said that local workforce areas do not get performance measure credit for the strategy itself. By focusing investments into specific sectors, the results should mean that performance measures for a specific program would increase.
In response to questions from Representative Flood, Ms. Brinly said that the Workforce Investment Act removed the requirement that 5 percent of funding be directed to older workers because the Act emphasized giving states flexibility in how funds would be spent. Mr. West said that some of the performance measures in the Act, such as encouraging full-time employment at higher wages, were biased toward the needs of younger workers. He said that assistance from members of the General Assembly in addressing this issue would be helpful as the Act is reauthorized by Congress.
Representative Flood encouraged Ms. Brinly and Mr. West to follow up with legislators on this.
In response to a question from Representative Simpson, Mr. West said that more research is needed to determine which programs are more successful in helping older workers.
In response to a question from Representative Simpson, Ms. Brinly said that her office handles the federal programs and she did not know why information on the number of older participants in state programs is unknown. Mr. West said that staff could look into this.
Ms. Shackelford summarized the Senior Community Service Employment Program. This training program is targeted towards unemployed low-income individuals 55 and older.
In response to questions from Representative Flood, Ms. Shackelford said that there were four host agencies in the program providing services to more than 1,100 Kentuckians.
In response to a question from Representative Flood, Ms. Shackelford said they have mandates but not necessarily for full-time employment.
Patrice Blanchard, the Associate State Director of AARP Kentucky, thanked Senator Harper Angel for raising awareness about this important issue. Problem-solving abilities and creativity increase with age. She gave examples of older persons needing or wanting to change careers. Many people over the age of 50 have successfully re-careered or made major contributions in later life. Policies should encourage employers to invest in training for all ages and design productive work schedules and routines that attract older workers, many of whom want part-time work or flexibility. Policies should encourage employees to continue their education in career pathways in high-growth industries.
In response to an earlier question from Senator Stine, Ms. Blanchard clarified that the Donovan Scholars Program, which provides for free coursework at universities, is only for those 65 and older.
Ms. Shackelford said many older workers are intimidated by younger workers and by technology.
Ms. Blanchard said that it was a myth that older workers do not learn well. Older workers learn differently and training modules should be developed with this in mind.
In response to a request from Representative Flood, Ms. Blanchard said that she could provide a fact sheet on common myths about older workers.
Upon motion made by Representative Simpson and seconded by Senator Schickel, the Workforce Development Options Targeted to Older Kentuckians Are Limited report was approved by roll call vote.
The meeting adjourned at 11:25.