What states, sector intermediaries, and funders can each do to build industry-led talent systems – and six tools to start with.
The vision describes two moves – employer-led organizations with the capacity to speak with one voice, and a system adapted to listen and act. What that looks like in practice will differ from state to state: each state has its own agencies, institutions, funding streams, and existing employer organizations to build from. The example below shows one way the pieces can fit together – a recognized sector intermediary at the center, one demand picture per sector, and every part of the ecosystem working from the same signal.
Recognizes one statewide, employer-led intermediary per priority sector through a formal selection process, funds the capacity the role requires beyond a single grant cycle, and supplies the employment and education data every demand picture builds on.
What could enable this →Share the knowledge only employers hold – the occupations they are hiring for, the skills and credentials that matter, where the pipeline is stuck – once, through their sector intermediary directly, or through the regional sector partnerships that already organize them.
What could enable this →Build programs against the sector’s actual hiring – pointing to the picture to demonstrate demand for new programs, teaching the skills employers rate most important, and localizing the picture through their advisory committees.
What could enable this →Receive the sector’s priorities through one coordinated channel, enable the alignment of program approval, funding, and renewal with the programs the sector endorses, and fund the strategies its employers prioritized.
What could enable this →Participate in the work the sector prioritized – training people on the job with the sector’s shared training plans, providing internships and work-based learning, and co-investing alongside public dollars in the sector’s pipelines.
What could enable this →Engage with the sector intermediary to get matched to programs seeking hiring partners, and hire from the programs the sector endorses, with job postings written in the picture’s skill and credential terms.
What could enable this →Placement, wages, retention, and credential value, published in one public place – so students and families can compare programs before enrolling, employers can see which programs to hire from, and the state can weigh the results when a program comes up for renewal.
What could enable this →Building the kind of system described above takes six roles – and none of them requires creating a new entity: each can be held by an organization that exists today.
The workforce innovator convenes the effort and aligns all parties around a shared vision for an industry-led talent system in their state. There is more than one way to play this role – the innovator might be a business-led civic coalition, an education nonprofit with deep employer ties, or a statewide roundtable – what matters is that all parties trust the organization and it has no stake in any one system. It can take on several responsibilities.
In Washington, Partnership for Learning is one example of an organization playing this role: documenting every place the state’s public systems ask something of employers (more than 75 distinct asks, from advisory committees to surveys to sign-offs), interviewing leaders across education and workforce, and convening a working group to shape a vision for how employers can play a more meaningful role in Washington’s workforce development ecosystem.
The industry associations, employer coalitions, and chambers of commerce that step into the role take on several responsibilities while the system is being built.
The governor’s office is the one office that can convene every agency whose processes have to change – K-12, higher education, workforce, apprenticeship, economic development. Sample roles the office could consider playing:
Philanthropy can provide the early money and the patient capital, and it can play several important roles while the system is being built.
Once the vision is in place, the work needs a clear leader responsible for implementation. That leader could be the workforce innovator, a team within the governor’s office, or an outside entity brought in for the purpose. Whoever leads it takes on several roles while the system is being built.
The work needs an independent assessment of whether it produced different outcomes for students and employers, and the evaluation partner plays several roles.
The system illustrated above is a complete one, and no state needs to build all of it at once. The steps below describe how a state can begin with two or three sectors and a small budget, show early results, and use those results to add sectors, widen each intermediary’s role, and secure more durable funding. Open any step for the detail.
An industry-led talent system will not resolve every workforce problem, and building one encounters real challenges along the way. The objections below are the ones we take most seriously – each is reasonable, and each has an approach that reduces the risk.
“Choosing the sector intermediary will be politically hard.”
It will be. In most sectors more than one organization can claim the role, and naming one means not naming others. That is why selection needs a formal process with published criteria, run with transparency and ideally with employers themselves involved in the selection – and why a state can start in the two or three sectors where employers already agree on who speaks for them. Selection criteria should weigh an established employer network, accountability to employers, and a track record with the sector over a polished application. How states can select sector intermediaries works through the scenarios, including what to do when a sector has too many candidates – or none.
“Employers are tired of being asked to join tables. This will feel like one more.”
If this becomes another standing meeting, it fails. This approach is built to reduce what the system asks of employers: the state audits its existing employer touchpoints and consolidates the duplicates, requests route through the sector intermediary so an employer shares what it knows once, and the sector’s input connects directly to approval and funding decisions – so time spent visibly changes what gets built. The enabling levers in the visual above name the specific mechanics.
“Business should not steer public education.”
This is a common and reasonable reaction, and the scope matters: this model concerns career-focused education and training – not general academic education. Even within that scope, public bodies keep every final decision. Employers hold a defined recommendation-making role – publishing what their sector needs and endorsing the programs that teach it – while approval, funding, and accountability stay with the state and its institutions. The role itself comes with rules. An intermediary must show it represents its whole sector, and its recommendations are weighed against what they deliver for students – well-paying work, accessible to every community the system serves. The aim is programs whose graduates get hired – and employers know what they will hire for.
“This is built around employers. Where are workers and students in it?”
The system’s measure of success is what happens to the people who move through it: whether graduates find work in the field, what they earn, and whether they stay. Those are the outcomes the state publishes and the outcomes programs are renewed on. Employer input serves that goal – a demand picture steers a learner’s time and tuition toward the skills employers will pay for – and it changes none of the decisions workers and their advocates already hold: public bodies keep approval, funding, and accountability, and worker organizations keep every seat they have today.
“In a local-control state, this will never reach the classroom.”
Institutions and faculty decide what gets taught, and this approach does not take that decision from them. Its levers are voluntary – streamlined approval, bonus funding, endorsement, equipment grants – things an institution opts into because they make its programs easier to approve and better funded. Adoption spreads program by program, which takes longer than a mandate would. In Ohio, the statewide manufacturers’ association brought more than 45 manufacturers together to build a shared competency model of the skills their jobs require, and Ohio’s Department of Education and Workforce adopted it. At the college level, where faculty control their own curriculum, the association offers a curriculum assessment that a program can run against the model and bring to its own employer advisory committee.
“We already have regional sector partnerships and TPM collaboratives. How is this different?”
Those are the building blocks, and this approach depends on them. A regional sector partnership or a Talent Pipeline Management collaborative organizes employers and produces a demand signal for its region. What it usually lacks is a way for that signal to reach the state as more than one region’s request, and a state set up to act on it. What we are arguing for is the state’s half of the arrangement: a statewide voice for each sector that combines the regional signals into one set of priorities, a clear channel that brings them into state decisions, and a state that accepts what that voice identifies as evidence of demand when it approves, funds, and renews programs. In Ohio, the statewide manufacturers’ association endorses roughly twenty regional sector partnerships. Each partnership shows every two years that its work is driven by manufacturer demand and aligned with the association’s statewide strategy, and in return receives the association’s technical assistance, resources, and funding opportunities – while the association brings the network’s priorities to the state agencies it convenes on a regular basis.
“This is untested, and there are not enough proof points to justify investing.”
In the United States that is partly true. Ohio, Indiana, and Washington have each built a piece of this system; no state has assembled the whole. Elsewhere it is standard practice – Switzerland, Singapore, and Germany each give employer associations a formal, funded role in shaping training, sector by sector. The thin American evidence is an argument for building proof points deliberately: start in two or three sectors, name the success measures up front, and publish what happens – the evaluation partner’s role described above.
“This costs money the system does not have.”
There are two costs, and they are different. The cost of supporting the intermediary – staff in each priority sector and a small central support team at the state level – is modest. The larger cost is money to act on what the sector recommends: when nothing employers recommend gets funded, they have little reason to keep participating. Money for both already exists. Philanthropy can fund the intermediary at the start, as the Richard M. Fairbanks Foundation is doing in Indiana; the WIOA Governor’s Reserve, the federal workforce funds a governor directs statewide, can fund sector strategies, as can state grant funds; and program dollars already flowing to career and technical education, colleges, and apprenticeship can go to programs that deliver the outcomes employers and students both want. The most expensive choice is the current one: public dollars flowing every year to programs whose graduates struggle to find work in their field.