Building a 21st Century Workforce and Market – What’s the Solution? (KPCC Forum Series)

Economic and Demographic Context

• California's unemployment rate stands at 5.9%, with Los Angeles County at 6.2%.
• Los Angeles ranks 28th out of 30 major U.S. metro areas in educational attainment, trailing only Las Vegas and Riverside.
• Between 1990 and 2012, LA County experienced a 7.1% decline in payrolls, a steeper drop than Cleveland (-2.6%) or Detroit (-6%).
• LA County holds the distinction of the worst housing affordability in the nation.
• Immigrants drive California's population growth; without immigration, the state's population would be shrinking, though children of immigrants are disproportionately likely to leave the area.

Workforce and Skills Gap Trends

• High-tech job growth has concentrated in the Bay Area, while Southern California lost its historical dominance in aerospace and manufacturing after 1990.
• A "decoupling" phenomenon occurred during the last recession where productivity remained high due to technology adoption while worker numbers declined, creating a need for continuous re-skilling.
• 65% of new jobs now require post-secondary training beyond a high school diploma.
• There is a significant shortage of "middle-skill" jobs requiring certificates or associate degrees, which often offer salaries exceeding $60,000.
• Career Technical Education (CTE) graduates from California community colleges earn an average of $68,000; specific high-paying tracks include electrical systems ($110,000), laser/optical technicians ($104,000), and radiotherapy technicians ($98,000).
• The shelf-life of technical knowledge is shortening, necessitating "stackable" credentials and micro-credentials for lifelong learning.

Employer and Utility Sector Responses

• Southern California Edison is transforming into a high-tech industry, integrating 100,000+ solar installations and requiring a workforce proficient in data analytics and IT alongside traditional electrical engineering.
• Utilities face challenges in recruiting for modern grid roles due to curricula that lag behind technological advancements in energy storage and smart grid management.
• Companies are increasingly relocating expansion projects (e.g., new factories) to states like Texas to avoid California's lengthy permitting processes, which can take 2–3 years compared to six months elsewhere.
• Small business creation is highest in LA County, yet these entities struggle with access to capital compared to Northern California.

Policy, Wages, and Housing

• The implementation of a $15 minimum wage in LA (starting 2020) risks pushing employers further into the informal economy unless accompanied by easier licensing and registration.
• Housing stock growth in the mid-2000s focused on large, distant McMansions, exacerbating commutes; current high values are driven by proximity to jobs and transit access.
• Raising wages alone is insufficient to address the affordability crisis; a public role in building affordable housing near transit is required to prevent gentrification.
• Government procurement power (e.g., rail car contracts) is identified as a lever to create high-wage jobs for local residents.

Forward-Looking Statements and Predictions

• The economy will shift toward a "retraining economy" where continuous upskilling is the norm due to rapid technology adoption.
• Future competition among regions will be based on a ratio of "big C" (traditional degrees) to "little C" (micro-credentials and badges) education.
• The workforce will need to adapt to a more technical environment with increased automation and data analytics across all industries.
• Lifelong learning will become culturally normalized as people work longer due to increased life expectancies and insufficient retirement savings.
• Sustainability sectors (e.g., smart grids, energy-efficient buildings) will generate significant employment opportunities aligned with climate goals.

Specific Programs and Initiatives

• Utility Precraft Trainee Program (LA Department of Water and Power): An "earn while you learn" initiative paying $16/hour plus benefits to train entry-level workers, with a focus on fair hiring for individuals with criminal justice records.
• Community College Prioritization: 14 of 15 regions prioritized healthcare and digital media/ICT, while 8 prioritized advanced manufacturing, aligning education with regional economic drivers.
• Cal Poly Hiring Rate: Cal Poly Pomona and San Luis Obispo maintain over 95% hiring rates for engineering graduates, largely due to applied training curricula.