From the top of the ecosystem, Memphis culturally does not know how to grow and evolve. After all, it has been almost 20 years of competitive decline under the cartel of Memphis Tomorrow which has consistently promised a better tomorrow. Memphis Tomorrow is a CEO organization whose initiatives use your Federal, State and Local tax dollars for community betterment. Problem is the unmeasured Memphis Tomorrow is down in every category over almost 20 years while using taxpayer money.

True story – In November, The Economic Development Growth Engine (EDGE) cartel member elected to  lose taxpayers $3M to incent low wage warehouse jobs. These are the very jobs the current Memphis Brookings Focus economic development plan  de-emphasized. So why incent the jobs ? Because the cartel does not operate within a framework of community accountability. In this case, the math fact and community cost is $3M that could have tripled the Southwest Community College “wrap around” Foundation budget for the next 10 years ! 

On Behind the Headlines, Dr. Tracy Hall, Southwest President, stated the current annual foundation budget is $150K and not enough to serve wrap around student needs for expenses like books that that go beyond tuition costs. Such investments in workforce could help boost low post-secondary completion rates while increasing wages – something Shelby County Mayor Lee Harris and Dr. Elena Delavega are both advocating. In a city where Workforce Development is the #1 priority, this should be a slam dunk but not under the Memphis Tomorrow cartel. 

What’s even more alarming about the EDGE LeSaints approval, EDGE also oversees workforce in the Greater Memphis Alliance for a Competitive Workforce (GMACW). The EDGE/GMACW Board never meets thus dismissing workforce as an economic development strategy. In this way, the LeSaint approval is just typical as both EDGE and GMACW were birthed out of the Memphis Tomorrow decline by design cartel. So where is the legislative oversight ?

Legislators not Making The Workforce Business Case

A chief enabler of local competitive ecosystem decline is the lack of independent public measurement of the public-private complex. Some local legislators seem to draw comfort in partnering with the likes of the Memphis Tomorrow. But while this may feel cozy and familiar, its functionally incoherent as local government has a different customer in the taxpayer than does Memphis Tomorrow in local CEOs. This view would apply to any local government and business organization which is not unique to Memphis. And besides, public measurement, when it comes to taxpayer funded initiatives is good for the business community. 

But within the framework of economic development, as a consequence of this incoherence and without measurement tools, local legislators are not making the business case for increased investments in workforce to raise wages for the existing population. This is unfortunate as the only real economic development comes in the form of increasing wages for the existing population followed by recruiting new residents that make above average wages. 

Given this, local government needs their own taxpayer aligned economic and workforce development plans along with a platform to measure taxpayer return on investment in public-private partnerships. This will help insure better public policy development and implementation of taxpayer funded initatives. To that extent, going back to the LeSaint Logistics PILOT that lost $3M for taxpayers, the below table articulates what an alterative economic development investment in workforce looks like. 

Assuming a $300K annual investment over 10 years ($3M) in the Southwest CC Foundation fund and “wrap around” services, the below table assumes an increased 50% success rate for students in 1 and 2 year tracks resulting in a net increase in wages of $12.5K per student upon completion. 300 students get $1K per year with 150 increased completions per year. 

This results in a net increase of $76M in annual local wages and $2.3M in annual tax revenues while delivering a 76% return for taxpayers over 10 years. And this analysis does not include the use of economic multipliers. Problem is local legislators are not making business case for workforce development. See below table:

Solution

Without independent public measurement, Memphis public-private partnerships will not be successful. Private interests measure the effectiveness of their investments based on their shareholders and customers. Public concerns in Memphis should do the same. 

With respect to current public efforts, there is effectively no reliable measurement of public-private partnerships. This has resulted in cartel excesses, increased poverty and competitive decline of the Memphis ecosystem. For example, there is no centralized measurement platform for economic development incentives which can be shown to more than $250M in excess. 

At the same time, there is an LOSB solution on the table to address the problem in the Tax Incentive Fiscal Note Impact (TIFNI) platform. The TIFNI solution provides a fiscal note for each tax incentive while providing a methodology for right sizing incentives based on projected taxpayer return on investment. Additionally, TIFNI centralizes all tax incentives in a central repository for cost effective administration.

Without effective public measurement and administration, public-private partnerships will result in continued ecosystem decline leaving the Memphis/Shelby taxpayer holding the bag for years to come…..

Let’s say that Commissioners Michael Whaley and Brandon Morrison wanted to direct a finite set of economic development resources more toward workforce development. Would they have the data to make the business case?

For some time now, expensive economic development programming, primarily in the form of corporate/real estate incentives, have exploded in Memphis without reliable measurement all while local workforce development efforts have floundered. One reason for this is the lack of publicly administered measurement and a data driven business case for workforce development.

Over the past 8 years, floundering workforce development efforts have persisted in the midst of faulty business cases made using unreliable economic impact studies that forecast massive tax revenue windfalls in favor of corporate/real estate incentives. 

The result, flat local tax revenues with connected workforce development implementation five years behind schedule. This is troubling, just as a recent Smart City Memphis posted  Brookings Report states that over 95% of surveyed executives rated the availability of skilled labor as “very important” or “important” in site selection. The report further signals an economic development disconnect with only about 2% in economic development incentives nationally going toward job training.

So does the County, Whaley and Morrison have the measurement tools to make the business case for more resources directed toward workforce in local economic development efforts? Not at the moment. After all, County Trustee Lenoir and now Newman have repeatedly called for an integrated database just to manage tax incentives of 9 abating boards and then there is the question of reliable economic and fiscal impact measurement of incentives of which there is none. There has to be a better way…..

Tax Incentive Fiscal Note Impact (TIFNI) Platform

There is a better way. While leveraging local data, TIFNI is a proposed LOSB research project to deploy a data driven methodology to size public economic/workforce development incentives and expenditures based on customer taxpayer return on investment (ROI) analysis while deploying an integrated tax incentive database. Just like a community does not want to go over board with corporate/real estate incentives, they do not want to rush and overspend with workforce development either. 

So what’s the right amount ? While its undetermined, with a Memphis youthful population asset advantage over peer economic development competitors, TIFNI would likely recommend directing more financial resources toward workforce development to increase wages and improve economic development outcomes. In the end, the only true economic development in Memphis is going to happen by increasing wages of the resident population or through new residents that make above average wages. New residents making below average wages, isn’t going to move the needle.

At the same time, the community can’t underspend on business development expansion or overspend at the cost of workforce development within the context of economic development and a global economy. A simple organizing framework can be found in the diagram below when implementing reliable economic and fiscal impact analysis regarding business expansion incentives.

The budget is balanced with average wages. So, business expansion with below average wages is unlikely to receive tax incentives absent significant capital investment. And if they do receive incentives in this model they will likely be below 75% for new capital investment when employing below average wage jobs. Likewise, in the current economic development environment, properly measured incentives are in order when considering business expansions that pay above average wages. See diagram below. 

To that extent, TIFNI can be applied to optimize workforce development ROI as well within the context of economic development. 

Conclusion

Publicly administered reliable economic and fiscal impact analysis with key performance indicator measurement is needed to serve economic development efforts for the benefit of the Shelby County taxpayers. The LOSB TIFNI solution provides just that. Without needed measurement, Whaley and Morrison are likely to only be workforce activists unequipped with a data driven business case to optimize customer taxpayer ROI for local economic and workforce development efforts….. 

Memphis industrial momentum can be found in the Bureau of Labor and Statistics (BLS) sector of “management of enterprises”. Since the 2014 Brookings FOCUS Memphis-Shelby County Regional Economic Development plan release, average wages have increased by 30% (peer avg 10%) and total wages have increased by 90% (peer avg 20%) in the plan untargeted management of enterprises sector.

The sector pays an average wage of above $100K and has a low economic multiplier to fuel community economic growth. Shelby County significantly leads all of its 16 member peer group in percentage total wage growth of this industry sector. See table above.

The management of enterprises sector hosts wealth management holding companies which in many cases house the real estate LLCs that benefit from tax incentives. To increase economic resiliency, Brookings FOCUS targeted diversification of wage concentration away from the heavily concentrated transportation sector with growth targets residing in healthcare, professional technical services, agriculture and manufacturing sectors.

The unplanned growth in management of enterprises reveals that significant wage growth concentrated in high wage jobs that needed wage growth the least as measured by location quotient. Location quotient, in this case, compares total wage concentration of an industry sector to locations throughout the United States. Shelby County led its 16 member peer group with 69% total wage concentration growth (peer avg 5%) in management of enterprises. This growth happens to coincide with the acceleration of liberal tax incentives that occurred under the 2014 Brookings FOCUS plan.  

Good news in the below chart shows that transportation, a dominant sector employer, had 13% growth in average wages and healthcare achieved peer average growth from 2014-18. Bad news is that targeted sectors for wage concentration growth in professional technical services, agriculture and manufacturing all declined as did average wages in the respective sectors.

Most concerning is the 17% wage concentration decline in manufacturing (+1.3% peer avg) occurring as local workforce development efforts were dismissed. This occurred as Shelby County average wages exploded upward for high wage jobs in the untargeted management of enterprises sector from $109K to $142K under the unmeasured Brookings FOCUS plan. See chart below:

Workforce Development – Tulsa and Away from Nashville Comparisons

About the time the Brookings FOCUS “vision” economic development plan was released in 2014, Shelby County peer, Tulsa and not Nashville in this comparative case, was releasing a detailed workforce development “implementation” plan. The plan focused on occupations that served the energy, manufacturing, construction, healthcare, professional technical and transportation logistics industries. 

Did workforce development implementation work as an economic development strategy for Tulsa ? Overall, yes it did.

From 2014-18, Tulsa led the 16 member Shelby County peer group in both postsecondary completions with a 33% increase and increased wage concentration in manufacturing with a 21% increase. That translated into increasing total wage concentration, as expressed through location quotient (LQ), in targeted sectors and jobs with increasing wages. Professional technical industry wage concentration goal increases did not materialize for Tulsa and transportation goals were not met but appears to have been in part as a result of decreasing average wages in the sector. See below Tulsa results:

Having a measurable workforce development implementation plan worked to increase Tulsa postsecondary completion awards and to increase wage concentration in targeted economic development growth sectors. 

Recommendations

The following recommendations can be made based on the above:

Get away from excessive untargeted tax incentives. They don’t work as an economic development strategy while making the community less attractive for economic investment

Have a measurable economic development implementation plan with the taxpayer as the customer which aggressively targets manufacturing, professional tech services, agriculture and locally owned small business development

Have a measurable workforce development implementation plan

Prioritize responsible, properly measured and accounted for tax incentives for target industries.

Implementation of these recommendations will help to target and accelerate local economic development efforts while discontinuing practices that have not worked with increasing wages and the customer taxpayer in mind…. 

Memphis industrial momentum is in the Bureau of Labor and Statistics (BLS) sector of Management of Enterprises. Since the 2014 release of the Brookings FOCUS economic development plan, wage concentration in Shelby County has increased 69% in the untargeted sector that pays above $100K average wages.

Brookings FOCUS targeted transportation and warehousing for decrease and agriculture, healthcare, professional technical services and manufacturing for increase. About the time that the Brookings FOCUS economic development “vision” plan was released, Tulsa, a peer city, was releasing its workforce development “implementation” plan. It worked. Tulsa increased

Since 2014, Shelby County wages in the high wage management of enterprises sector increased by 30% from $109K to $142K. Total wages paid in the sector increased by 90%. from $660M to $1.26B. The sector houses holding companies which are of the type that would host many of the real estate LLCs that benefit from tax incentives. Brookings FOCUS targeted transportation and warehousing for decrease and agriculture, healthcare, professional technical services and manufacturing for increase. But Brookings FOCUS has gone unmeasured with wage concentration growth in targeted sectors not materializing

Key performance indicators (KPIs) funded and owned by Shelby County Government are needed for economic and workforce development measurement. Shelby County expenditures in these mission critical areas exceed $500M per year, yet there are no county owned KPIs to inform economic and workforce development oversight and policy work. The development of KPIs, which would also include a tax incentive fiscal note impact (TIFNI) platform for measuring (ROI) on tax incentives, could potentially be funded with $1.7M in misappropriated EDGE/Depot funds that should come back to taxpayers. This is an issue that has unfortunately gone locally unreported.

Federal and State government fund source their own KPIs, why shouldn’t Shelby County Government ?

Reliable KPI customer taxpayer centric measurement efforts have not been implemented or sustained by multiple organizations external to Shelby County government leaving policymakers and the customer taxpayer in the dark regarding hefty taxpayer funded expenditures. Perhaps the reason for this KPI unsustainability of outside organizations regarding taxpayer funds is because the vested interest is not there in measuring the effectiveness of funds outside of their organization.

And reliable measurement concerns regarding the Economic Development Growth Engine (EDGE) Scorecard methodology related to inflated tax revenue projections involving $500M+ in job tax incentives, have been regularly questioned in public proceedings, in the Daily Memphian and by The Beacon Center of Tennessee.  

Exploring EDGE Incentive Accounting

With tax incentives having been the primary Memphis/Shelby economic development tool and inflated projection accounting concerns going back 8 years, KPIs would correct EDGE tax incentive projection accounting concerns with complete accounting and a fiscal note for all agency abatements in a single centralized tax incentive repository as requested by the Trustee’s office. This action would enable pubic return on investment (ROI) analysis for tax incentives while providing insight for optimizing economic and workforce development investments in the digital educonomy.

For example, on this upcoming quarterly EDGE report to the Shelby County Commission, FR8 Zone and Cherry Tree tax incentive projects collectively claim $3.5M in projected tax revenue against $3.75M in tax abatement incentives. At the same time, there is $942K combined on both projects that inflate projected tax revenue by claiming existing property tax revenue as new project revenue. This finding adjusts revenue down from $3.5M to $2.6M against $3.75M in abatements resulting in a $1.15M taxpayer loss while recruiting low wage logistics warehousing jobs.

Further, there is another low wage warehouse project on the EDGE agenda for this week in LeSaint Logistics. The LeSaint Logistics project also overstates project revenue by $1.5M by claiming existing property tax revenue as project revenue. This reduces revenue from $4M to $2.5M against a tax abatement of $5.5M resulting in a taxpayer loss of $3M.

Concerning, the above EDGE incentives result in $4.15M in taxpayer losses to incent low wage warehousing jobs. These are the very type of logistics jobs that the 2014 Brookings Focus Memphis Economic Development plan set goals from which to diversify away. But Brookings FOCUS KPI measurement efforts were never implemented thereby keeping the door open for taxpayer losing incentives, like the ones above, for low wage warehousing jobs.

Overall, concerns of excessive incentives are routinely publicly voiced with the persistent winners being corporate/real estate interests while property tax revenues remain flat in the face of EDGE inflated tax revenue projections, lagging small business vitality and workforce development outcomes. Small business and workforce are the primary drivers of any local economy.

The above microanalysis of individual incentive awards (FR8, Cherry Tree and LeSaint) supports part of the flawed incremental methodology that has caused local job incentive awards to grow so large over time, not to mention the retention tax incentive accounting concerns confronted by the Beacon Center of Tennessee. The chart below, which has been published before, shows the per job cost of EDGE tax incentives when compared to peer cities Nashville and Indianapolis while pointing to an overall local $200-400M excess, when compared to other cities. These excesses accelerated under the Brookings FOCUS Plan where KPIs were not sustained.

And then there is the OaksEdge high end senior living residential PILOT on the agenda this week for a $22M tax incentive which is $22M more than would be awarded in any other County in Tennessee. Besides, the residential PILOT was designed to support infill development to attract Millennials to Memphis. But this is a whole other excessive PILOT story that involves the irresponsible expansion of the original intent of residential PILOTs which is arguably already a fiscally liberal provision exclusively allowed for Shelby County in the State of Tennessee. So back to the Brookings FOCUS economic development plan and KPIs.

Brookings FOCUS Plan

The Brookings FOCUS Economic Development plan was a public-private partnership planning effort and product of the Memphis and Shelby County Regional Economic Development Plan Steering Committee Co-Chaired by former Mayor A.C. Wharton, Shelby County Mayor Mark Luttrell and Christine Richards, formerly Chief Counsel for FedEx. The planning project was managed by the Economic Development Growth Engine (EDGE) and the steering committee consisted of representatives from education, industry and local government.

The 2014 Brookings FOCUS plan set out to 1) diversify away from logistics, 2) improve workforce through increased educational attainment, 3) increase support for entrepreneurs, startups and small business and 4) increase employment density in the urban core. Given these key findings, KPIs can be applied to measure the effectiveness of the Bookings FOCUS plan and taxpayer funded economic development efforts.

Per the Brookings FOCUS plan, as an example of a KPI for diversifying away from and decreasing transportation logistics low wage warehousing jobs with a focus on increasing healthcare, agriculture, professional tech services and manufacturing, a KPI can be deployed. This KPI uses Bureau of Labor and Statistics (BLS) data to measure industrial wage concentration changes in Shelby County as compared to the nation since 2014. Healthcare was the only improvement for Shelby County while Transportation targeted for decrease, increased and agriculture, professional tech services and manufacturing targets for increase, all decreased. Most concerning, was the significant fall in manufacturing industrial wage concentration.

As expressed through the below KPI, challenging all local industrial sectors for growth is an unprepared workforce with below peer average postsecondary educational attainment and program completion. The below shows how Shelby County postsecondary educational attainment, across all ward levels, compares vs 15 Shelby County peers. In short, Memphis/Shelby needs to increase postsecondary completions by 6,000 per year while promoting in demand career pathways, with digital technology in mind to serve all industrial sectors.

Shelby County Recommended KPIs

Federal and State government fund source and own their KPIs. Why shouldn’t Shelby County Government ? After all, there appears to be a local $1.7M funding source and external to Shelby County Government, local organizations have not executed in the KPI area. Besides, such organizations often lack a vested interest and have an agenda that is not in direct alignment with customer taxpayers. While the potential number of KPIs are endless, these are a few simple recommended KPIs for economic and workforce development measurement using authoritative Federal, State and Local government data sources:

• Centralized Tax Incentive Database for all Agencies with Fiscal Note Support
• Average Wages
• Total Wages
• Total Employment
• Unemployment rate
• Business Establishments per 1k Population
• Postsecondary Educational Attainment by Award Level and Career Cluster
• Industrial Employment and Diversification

In fact, deploying fewer simple but highly impactful KPIs that the County owns and maintains is probably best. A few simple KPIs will get the County started, with more to come. The KPIs will equip policymakers with the needed customer taxpayer aligned data, owned, funded and maintained by the County to inform public oversight and economic/workforce policy development.

FOCUS – A Roadmap For Transforming The Metro Memphis Economy is the prevailing economic development plan in Memphis. The 2014 plan is the product of the Memphis and Shelby County Regional Economic Development Plan Steering Committee Co-Chaired by former Mayor A.C. Wharton, Shelby County Mayor Mark Luttrell and Christine Richards, formerly Chief Counsel for FedEx. The planning project was managed by the Economic Development Growth Engine (EDGE) and the steering committee consisted of representatives from education, industry and local government.The executive summary of the plan states:

“Focus: A Roadmap for Transforming the Metro Memphis Economy will reestablish its steering committee under the umbrella of Memphis Fast Forward, adding more industry leaders and representation from diverse stakeholders to guide implementation. In coordinating action with key partners to ensure alignment, leadership will establish performance metrics, track progress, and hold partners accountable as implementation moves forward. It will build ongoing capacity for market analysis, identifying opportunities and prioritizing next steps.“

With the former stated, it does not appear that metrics or progress monitoring was ever established. Brookings FOCUS is never publicly discussed nor does it ever appear on local legislative agendas. At the same time, local government is spending over $60M per year on economic development without any defined economic development metrics or progress monitoring. So how can Brookings FOCUS be measured ?

Brookings FOCUS did lay out key findings in four challenged areas. Those findings are: 1) economic diversification away from logistics, 2) improving workforce through increased educational attainment, 3) increase support for entrpreneurs, startups and small business and 4) increase employment density in the urban core. Given these key findings, metrics can be applied to measure the effectiveness of the Bookings FOCUS plan.

Diversification Away From Logistics

The Bureau of Labor and Statistics (BLS) Quarterly Census of Employment Wages (QCEW) program can be used to measure industrial diversification using location quotients (LQ). LQs measure the concentration of a variable, in this case industrial wages, as compared to the nation. The Brookings FOCUS plan discusses remaining the national leader in logistics but diversifying the economy away from logistics.

The plan also mentions target sectors for growth which include biologistics, biotechnology, medical devices and agriculture. Using LQ, industrial diversification through total wages paid can be measured since 2014 using 2018 industrial wage data. Target areas mentioned are in red as found in the table below. Healthcare LQ from which some of the planned target economic activity would take place, grew in LQ by .03 while other target areas decreased in agriculture by .01, professional and technical services by .02 and most concerning manufacturing by .17.

As far as the industry target goal for LQ decrease in transportation logistics, it actually increased by .01. See the below table for all industries:

Economic diversification efforts could better be served by more public measurement and progress monitoring.

Workforce – Educational Attainment

Educational attainment can be measured using data from Integrated Postsecondary Education Data System (IPEDS). Using IPEDS, educational attainment levels can be compared to peer city competitors. To adjust for population variances between 15 peer counties, a population factor can be applied to peer economic competetitors actual postecondary completions. In this way, actual completers in a larger county such as Charlotte Mecklenburg County are reduced whereas program completions for a smaller geography such as Little Rock Pulaski County are increased.

Given this methodology, average prorated for population postsecondary completions for occupational clusters can be derived. Benchmarked from 2015, the below table shows the Shelby County gap from the prorated occupational cluster peer average. The column on the far right shows the average gap closure across 2016, 2017 and 2018. The 2014 Brookings FOCUS plan states:

In the first phase of implementation, the region will strengthen its workforce development system to prepare more workers for next economy jobs. The Greater Memphis Alliance for a Competitive Workforce will leverage new state programs that expand access to community colleges and training and strengthen alignment with regional employers and real-world skill requirements.

Using IPEDS data, the below table data shows the Shelby County progress of increasing postsecondary completions from 2014. A negative number reflects below prorate peer average completions. Bright spots in completion rates can be found in Health Science where the average gap closure across 3 years was 121 and Law, Public Safety, Corrections and Security at 67.

At the same time, in demand occupational clusters of Transportation average gap across 3 years increased by 16, Agriculture by 22, Manufacturing by 48, Information Technology by 117 and Architecture/Construction by 124.

Overall, the prorated postsecondary completion gap from 2015-18 increased by an average of 415 for all occupational clusters. Postsecondary completions overall, need to increase by approximately 7,500 per year to achieve peer average postsecondary completions.

Workforce development efforts could better be served by more informed public measurement and regular progress monitoring.

Increase Support for Entrepreneurs, Startups and Small Business

Since most businesses are small business, the best measure for small business vitality is BLS QCEW establishments. Using BLS QCEW data, the number of business establishments per 1K population can be derived. Memphis ranks last among 15 peers in the number of establishments per 1K population. The gain since the release of the Brookings FOCUS plan can be found in the far right column.

The average 2014-18 gain for business establishments per 1K population was 2.13. The Shelby County gain from 2014-18 was 1.35 per 1K population. Additionally, on the legislative public record concerns can be found related to the lack of support for locally owned small businesses (LOSBs). Based on the data, there appears to be a lack of establishment cultural support for LOSBs. See below table data:

Small business can best be supported by first increasing the transactional velocity with LOSBs while secondarily supplementing small business development with business planning advice and collaborative space. Further small business development efforts could better be served by more informed public measurement and regular progress monitoring.

Increase Employment Density In The Urban Core

Based on the data, the primary tool for increasing employment has been tax incentives based on the Northern Mississippi threat with less focus on workforce and small business development. Employment gains have been locally thwarted by unprepared workforce and public transit. The Brookings FOCUS plan states:

Tax advantages and aggressive incentive packages in northern Mississippi have accelerated the outward growth pattern, luring firms to relocate within the region and increasing both segregation and disinvestment in older areas.

Given the above, the effectiveness of Brookings FOCUS and local tax incentives can best be measured using BLS QCEW employment percentage gain and actual job increase data while benchmarking overall EDGE job incentives versus peer competitors.

Shelby County employment gains from 2014 to 2018 trail the peer average by approximately 1% or 5K filled jobs. Shelby County employment growth from 2014-18 was 4.83% compared to the peer average at 5.75%. And since EDGE began, employment growth trails the peer average by 4.4% or 20K filled jobs. At the same time, local job incentives are some $500M+ since 2011 while using incomplete accounting which has been externally questioned by The Beacon Center of Tennessee.

Based on this information, tax incentives can be benchmarked against 2 peer cities in Nashville and Indianapolis to show that Memphis/Shelby is paying about $14K per filled job in incentives versus Nashville and Indianapolis at approximately $2.5K per job. This results in $200-400M in excess job tax incentives which take away from investments that support workforce and small business and are the primary driver of any local economy.

Conclusion

Economic development efforts can better be served by more informed public measurement and regular progress monitoring.

The highest standard should be applied to a community’s leading public university. And in Memphis, that is The University of Memphis (U of M) as Shelby County Mayor Lee Harris leads a local economic development conversation focusing on increasing wages to improve local citizenry social well being.

In ANY city that struggles with high poverty levels, it’s reasonable for a local Mayor to reach out to its leading public university to help set the standard for improved economic development outcomes through increased wages and improved policy. But thus far, in the bubble of Memphis. the UofM has been unwilling to commit to a time frame for raising its minimum employee wage to $15 per hour.

Memphis needs help from its leading public university in the UofM in setting the example of improving economic development outcomes through increased wages while battling high poverty rates. With the UofM currently unwilling to commit to a time frame for increasing wages, the Harris administration is advocating for a contractual clause pertaining to the $1M County funded pool project that would bind the UofM to a time frame for increasing minimum wages to $15 per hour.

Some, like Commission Chairman Mark Billingsley have raised legitimate concerns regarding setting a new contractual precedent in treating the UofM differently. At the same time, Billingsley’s employer, Christian Brothers University announced a firm schedule for increasing wages to $15 per hour thereby setting a new local leadership standard for increasing wages.

No Precedent – The UofM is Different

In the recent County Commission discussion, questions were raised like “If we treat the UofM contractually differently are we going to treat MIFA and nonprofits differently when it comes to their contracts ?” or “Will this set a precedent in how we treat the UofM and require us to treat our vendors differently ? “.

There is no precedent here for nonprofits and vendors regarding contract consideration. The UofM is different from the former which provides a clear pathway for a unique contractual clause that would state a time frame for raising minimum employee wages to $15 per hour at the UofM. So how is the UofM different ?

The UofM is the only formula funded public entity actively participating in tax incentives while receiving local discretionary funding consideration. See below local projects awarded since 2016:

• The Highland TIF – $21M (Awarded)
• Pool Renovation Project – $1M (Awarded)
• 2 residential PILOTs that that did not meet minimum EDGE requirements – $1.2M (Awarded)
• A new tennis center – $3M (Awarded)
•  Park Avenue TIF (Forthcoming)

Grand Total: $26M in awards with more scheduled

As shown the public is going over and above to support the University of Memphis. But is the UofM reciprocating ?

A Higher Standard for The UofM

A higher standard in the local of work of community and economic development is needed for the UofM. The UofM will never reach their potential as a university or thought leader unless they independently become a transformational force in setting the local standard in confronting staggering poverty levels in their own community while improving community and economic development outcomes.

The UofM could have helped to expedite lagging connected workforce development efforts or they could have sustained credible economic development measurement platforms that included peer comparisons or they could have conducted a more credible economic outlook survey or their investigative journalism efforts could have more aggressively questioned the local establishment on lagging economic development outcomes or they could have set a firm timetable for raising minimum wages to $15 per hour but the UofM didn’t. All of the former helps to bolster the work of economic development for the resident population and the UofM as a transformational university thought leader.

Generally, one of the worst outcomes for any university is to surrender their thought leadership to the local establishment leaving a community without needed system checks. This seems to have happened with the UofM on the local community and economic development front under the new local UofM Board of Trustees. At least before, in 2015, the UofM seemed to have felt free to exercise thought leadership while questioning the local establishment in this report from the University of Memphis Planning Department. But that does not seem to be the case today.

Conclusion

In a Memphis community with staggering poverty levels, the community needs a University of Memphis that sets the standard in confronting poverty while independently advocating on the front lines for more thoughtful and research based economic development policy. Without it, both Memphis and the UofM loses.

One way to improve economic development outcomes and local wages is to increase enrollment and employment in information technology pathways and careers. Info Tech careers pay $20K more than the average for all occupational groupings. If we assume a 2.0 economic impact multiplier, for every  grouping of 1,000 retained and employed info tech postsecondary completers that equates to $40M in increased annual wages. The above chart shows the Shelby County gap compared to 15 peers in info tech postsecondary completion awards when compared to the peer average.

The Upskill901 conference was successful at convening stakeholders and alerting attendees of the coming disruption of automation. But few participant tools were left behind by the out of town think tanks in Brookings and Burning Glass to facilitate needed conversations, thinking and planning in support of connected workforce development implementation.

Placeholders are like a database in tables, queries, user interface and reporting output in that that provide organizing constructs to help answer questions and provide connectivity to services. Examples of placeholder constructs that could have been left behind for connecting the workforce development system include:

• Benchmarking, goal setting, planning, implementation and evaluation
• Data, assessment and career pathways curriculum
• Identify, promote, enroll and graduate  (IPEG)
• Relevant local data

To that extent, this blog is expanding on those gap opportunities while proposing solutions for connected workforce development. In the previous blog, we disclosed a methodology to identify occupational groups in need of career pathways promotion intervention based on local ecosystem and employer demand. This blog will drill down on the need for more information technology postsecondary awards to serve coming transformational automation.

Getting Specific with Workforce SMART Goals

In the last blog we took a guess at SMART goals for information technology, business/finance and entertainment media careers. This blog will get specific by writing SMART goals for increasing information technology completion awards by level. The above table, by award level, shows the “ACTUAL” peer average completion awards, “SHELBY COUNTY” actuals and a “PRORATE” column to adjust the peer average based on population.

With the above, we can generate data informed Shelby County SMART goals to achieve above peer average completion rates in the information technology field. See below SMART goals for increasing Shelby County information technology completion awards:

• Increase less than 1 year awards by 50 in 2 years and 150 in 4 years
• Increase 1 year/+ awards by 15 in 2 years and by 50 in 4 years
• Increase Associate awards by 20 in 2 years and 60 in 4 years
• Increase Bachelor / Post Certification by 60 in 2 years and 180 in 4 years
• Increase Masters / Post Certification by 30 in 2 years and 70 in 4 years
• Increase Doctorates by 2 in 2 years and 6 in 4 years

There is nothing fixed about the above goals but just a demonstration of how data can be used to inform Specific, Measurable, Attainable, Relevant and Timely (SMART) goals for increasing postsecondary information technology completion awards.

Peer Rankings

So how  has Shelby County fared compared to their peer cities in information technology postsecondary completion awards across all levels ? The data can be found below:

Conclusion

Data informed benchmarking to inform SMART goals is fundamental in connected workforce development implementation. In this blog, we used the peer average of info tech postsecondary awards to benchmark Shelby County completion awards to inform goal setting. Hopefully, this process or a similar one will be used to catapult economic and workforce development with a emphasis on increasing information technology completion awards and local wages.

Data Source References

LOSB SOLUTION: Resolve Cloudy Communication with Research Based Connected Workforce Development Plan and Common Language Support

In many ways, the Memphis workforce development system faces the same work that will likely be asked of learners related to their career pathways planning efforts. The work is as follows:

• Where are we ? – Benchmarking / Learner Self Exploration
• Where do we want to go ? – Workforce Goals / Learner Career Exploration
• How do we get there ? – System Planning / Learner Career Planning
• Implement  workforce development plan / Learner pursues career pathway through lifelong learning and employment
• Measure, evaluate and course correct as needed

In this blog, we will bust out a couple of more data sets to help target and expedite ecosystem and employer demand driven workforce development. “Expedite” is key and away from the “long haul” of workforce development implementation that has never worked.

First, let’s define terminology that will help us target occupational groups for promotion as informed by UpSkill901, local ecosystem and employer demand. “Location quotient (LQ)” defines the concentration of a particular occupation or occupation group within a given geographic area compared to the nation.

This targeting methodology, ideally would be folded into a workforce development plan. Again, from the previous blog, fundamentals of any connected workforce development plan and deployment of career pathways consists of “common language” development with 1) a unifying measurable definition for “career readiness” applicable to diverse target audiences  2) employer demand data, 3) occupationally aligned assessments, preferably universally recognized to support economic development efforts, 4) career pathways curriculum alignment and planning, 5) professional development and typically 6) centralized technology to reduce implementation costs.

In addition to LQ to target high need occupational groupings that are ecosystem/employer demanded, we will also reference postsecondary award completion data.

Expediting Benchmarking

In this example case, lets say that we want to expeditiously identify, promote, enroll and graduate (IPEG) more individuals in high need career pathways. High need occupational groups would need to be identified which point to opportunities to accelerate talent development while increasing completion rates.

So how might we identify high need occupational groups? Based on ecosystem/employer demand and coming automation, that might point to the need to identify more learners interested in computer technology, entrepreneurship/business and arts/music entertainment. Computer technology and business occupations serves all industries while music serves the local culture and tourism industry.

But is there a high need for a promotional intervention for these specific occupational groupings? Let’s bust out a data set and see. In the below data set, we can see that that there is a low concentration (LQ) of less than 1.0 when compared to the nation and versus 15 peer cities, in computer, business/finance and entertainment occupational groupings, Memphis ranks 15 or 16 in LQ. And all of these groups pay a good wage.

To that extent, low LQ benchmarks are validated which supports a promotional intervention to increase enrollment in career pathways for the occupational groupings of computer, business/finance and arts/entertainment.

The above benchmarks would point to an opportunity to accelerate talent development while increasing completion rates. Lets bust out another data set. Below is a table that shows how Shelby County completion rates, across award levels, rank versus 15 peers. Low hanging fruit opportunities to increase completion rates can be found in 2 year awards and less while promoting lifelong learning for Bachelors and beyond. The actual and prorated for population peer completions are shown below. Rankings are based on the prorate for population peer average.

Expediting Goal Setting

Here, we are focus on expediting workforce development implementation and not the “long haul” because that does not work. Let’s generate some sample simple, measurable, achievable, relevant and time bound (SMART) goals based on the benchmarking in the former sections:

• Increase computer technology postsecondary awards by 200 per year
• Increase business/finance postsecondary awards with a focus on entrepreneurship by 200 per year
• Increase arts, entertainment and media postsecondary awards by 50 per year

The above example SMART goals are not all inclusive of all occupational groupings that might require a promotional intervention. But such goals would be rolled into a workforce development plan.

Expediting Implementation Away from the “Long Haul”

Ultimately, various regularly administered technology based assessment tools, like the one shown above, will probably be implemented to facilitate learner identifcation, promotion, enrollement and graduation (IPEG) in student aligned career pathways. But connected implementation should not wait for the perfect implementation model and should start right away.

For whatever reason, while stating workforce development as the #1 priority to be a “long haul”, implementation never seems to get off the ground in Memphis. Its like everyone, to get started, is waiting for a pageantry event kickoff and perfect plan that will never exist.

The way to get started, right away, is to formally distribute, via whatever means, data and talking points to educational and workforce development practitioners so that they can begin integrating career pathways content into their instructional thinking, planning and practice and having collaborative conversations. In the report Education to Employment: Designing a System that Works, McKinsey says to “Get the information out”. The implementation will evolve from those conversations once the data and information is distributed to the public.

Optimal implementation will take time in the implementation of programming, but  should not wait until everything is perfectly ready to go. For example, getting standards aligned career pathways curriculum implemented into the curriculum will not be overnight. Such curriculum will facilitate the implementation of IPEG which will allow practitioners and stakeholders to identify students through a range of assessments for promotion into specific career pathways enrollment aligned to learners’ interests, preferences and skills.

Conclusion

In this blog, in a sample case, we have used a labor market information methodology to benchmark where we are with respect to postsecondary completions and high need occupational groupings that need promotional intervention and where we want to go in the form of SMART goals that would be folded into an ever evolving and imperfect connected plan.

There are certain foundational tenants and organizing principles that need to be introduced right away that are not going to change related to the work of connected workforce development. Examples include:

• Benchmark, Goals, Plan and Implement
• Data, Assessment and Career Pathways Curriculum
• Identify, Promote, Enroll and Graduate (IPEG)

But the above will be ongoing and its never going to be perfect. As emphasized, in the blog about a year ago, don’t talk about the “long haul”, Go and get started !

After my most last blog, a local personality emailed me stating that in the UpSkill901 Education Pillar session we both attended, there appeared to be cloudy communication disconnects between community stakeholders from diverse professional backgrounds.  Additionally, the personality was looking for a data source to track post-secondary completion progress. In our shared session regarding talent pipeline development, business professionals were communicating in terms of “customer mapping” and educators were communicating in other terms to describe the process of student career navigation which includes self exploration, career exploration and career planning.

The primary need coming out of UpSkill901 was a research based connected workforce development plan with a common language framework to support productive conversations between professionally diverse stakeholders while eliminating silos. While being a net positive for the community, the benefits of the recent UpSkill901 Chamber event were to alert the community of the coming disruption from automation, convening workforce stakeholders and identifying service gaps. Further gaps include the need for local subject matter expertise to critically evaluate instructional technology to avoid pitfalls of the recent past while insuring research based implementation.

The above questions would be answered within a connected research based workforce development plan that facilitates common language development. Again, from the previous blog, fundamentals of any connected workforce development plan and deployment of career pathways consists of “common language” development with 1) a unifying measurable definition for “career readiness” applicable to diverse target audiences  2) employer demand data, 3) occupationally aligned assessments, preferably universally recognized to support economic development efforts, 4) career pathways curriculum alignment and planning, 5) professional development and typically 6) centralized technology to reduce implementation costs.

All of the former elements contribute to common language development which reduce communication disconnects while facilitating productive communication between diverse stakeholders. Its not important that everyone is a subject matter expert (SME) in all things related to workforce development but it is important that SMEs exist somewhere in the system and that all stakeholders are aware of authoritative data supports and research based best practices to support common language, productive communication and implementation of connected employer demand workforce development efforts.

While the local establishment has been incumbent on exporting workforce development programming to out of town entities, implementation has not occurred in the “long haul” of connected workforce development implementation over the past 5 years. This has cost taxpayers an estimated $1B in wages and $30M in deficient recurring tax revenues. All of this has occurred, as LOSBs have been dismissed while formally proposing research based connected solutions on the record and through published blogs.

One of the most efficient ways the establishment can improve lagging small business vitality is by increasing transactional velocity in the system with LOSBs when credible ready to go LOSB solutions are proposed to course correct and solve community problems. Dismissing LOSBs with the ‘long haul” staple, in  “well workforce development is going to be a long haul”, as services effectively go undelivered over 5 years, is a lose-lose prescription for LOSBs, economic development and the community at large while also lowering expectations and accountability for expeditious service delivery. Sadly, Memphis has never really got started with the “long haul” of connected workforce development programming.

And it must be said, that none of the outside entities nor have any of the local workforce development nonprofits proposed the need for a connected workforce development plan or a framework for such a plan over the past 5 years all while LOSBs proposals have been dismissed. Still wonder why small business vitality struggles in Memphis ?

Anyway, the outside think tanks of Brookings and Burning Glass were successful at communicating the upskill need for the coming automation disruption while establishing expectations for lifelong learning. But the data slides presented seemed designed to impress rather than communicate as they were, at least to me, complex and hard to digest while not getting reinforced with a closer view in the breakout sessions. It would seem more simple slides could have been used to answer more foundational questions like 1) How does Shelby County fare versus its peers in educational attainment ? 2) What are and define “soft skills”? and 3) What skills and knowledge are most in demand?

To that extent, this blog will expand on fundamental common language supports that should be included in a connected workforce development plan to help answer those more basic questions.

Common Language Data Supports

While a bit dry, the following is a sampling of authoritative public domain data sources that facilitate common language development and measurement within the workforce development system. In most cases, these sources are foundational and leveraged by third party providers to provide services. For this reason, its important that SMEs exist somewhere in the system to understand how proprietary data interacts with data in the public domain and how computations are performed.

As an example, through subject matter expertise, accountability can be enforced while avoiding computational debacles that contribute to local imbalances such as those computations of Younger and Associates related to inflated EDGE tax revenue projections. See below workforce development data sources and then we will bust out a few use cases to answer those basic questions initially broached:

Occupational Characteristics. The O*NET database content model contains various score requirements for over 800 occupations in relationship to a standardized common language framework of 35 discrete skills, 33 areas of knowledge, 16 work styles, 5 education and training levels, 41 generalized work activities, 57 work contexts and 52 abilities for a total of 239 descriptors. The O*NET data collection effort is administered by Research Triangle Institute in conjunction with the United States Department of Labor and serves as an authoritative source for common language development within the workforce development system. The statistically reliable O*NET database is routinely used as a primary or baseline data source in a vast array of proprietary products. An example use case for ONE*T, from the recent UpSkill901 event, would have been to better define “soft skills” with specific discrete skills from the O*NET subcategory skills of basic, social and resource management skills. The chart at the top of this section uses O*NET as a data source to communicate projected skill demand for all occupations. This same chart can be produced for selected career clusters as well as individual occupations.

Postsecondary Data. Integrated Postsecondary Education Data System (IPEDS)- IPEDS forms the institutional sampling framework for other NCES surveys, such as the National Postsecondary Student Aid Study and the National Survey of Postsecondary Faculty. This data source can help regional consortiums understand regional occupational supply to inform completion rate progress and regional occupational supply/demand studies. These studies help to guide the selection and development of career pathways as well as regional career pathway promotion and program offering. The raw data from IPEDS requires SME compilation as it is not intuitive upon download. See this sampling of downloaded IPEDS data.  ( https://nces.ed.gov/ipeds)

Occupational Wages. Occupational Employment Statistics (OES) – Program produces employment and wage estimates annually for over 800 occupations. These estimates are available for the nation as a whole, for individual States, and for metropolitan and nonmetropolitan areas. National occupational estimates for specific industries are also available. This data helps learners consider wages in career exploration and employers and policymakers understand wage trends to support occupational demand analysis (http://www.bls.gov/oes/).

Occupational Projections. Projections Central (State Occupational Projections) – Projections of occupational employment growth are developed for all States and the nation as a whole. One of the most important uses of projections is to help individuals make informed career decisions. Information on this site allows projected employment growth for an occupation to be compared among States. It also allows projected employment growth among occupations to be compared within one State when accessing state specific sites. The data source further helps regional consortiums access regional projections to understand demand for select career pathways, promotion and offerings to support economic development efforts while helping learners evaluate career choices based on projected openings for a given occupation (http://www.projectionscentral.com/Home/Index ).

Industrial Sector Employment Demand. Quarterly Census of Employment and Wages (QCEW) – Program publishes a quarterly count of employment and wages reported by employers covering 95 percent of U.S. jobs, available at the county, MSA, state and national levels by industry. This data source can help regional consortiums deploy demand driven industry sector strategies (http://www.bls.gov/cew/).

Career Pathways. Career Pathways is a series of connected education and training strategies and support services that enable individuals to secure industry relevant certification and obtain employment within an occupational area while advancing to higher levels of education and employment. Comprehensive standardized mapping of classification of instructional programs (CIP) codes and O*NET/SOC occupational codes into career clusters and career pathways is provided. This data can help locals relate their program offering to career clusters and occupations -(http://cte.ed.gov/).

The above data can be leveraged and deployed via a centralized technology portal in various forms to facilitate cost effective common language development.

To the extent technology is used, a research based connected workforce development plan provides an architecture for which proprietary tools generally and technology tools exist in an overall connected workforce development system. A research based plan would provide a framework for evaluating proprietary technology tools while subject matter expertise could help facilitate evaluation of technology tools. In this way, technology implementation occurs and scales while delivering services in a timely manner.

Common Language Data Use Cases

Now to some use cases and back to those basic questions: 1) How does Shelby County fare versus its peers in educational attainment ? 2) What are and define specific soft skills ? and 3) What skills and knowledge are most in demand ? See below:

Prorated for population and using IPEDS data, the chart below shows the gap in postsecondary educational attainment awards versus the average of 15 Shelby County peers throughout the country to include Louisville, Indianapolis, Nashville, Tulsa and etc.

Using O*NET as an authoritative data source, the below chart lists discrete soft skills and their definitions

A chart listing of the most in demand skills while using O*NET as a foundational data source. As shown, the most in demand skills are for the most part soft skills, thus the soft skill emphasis. This data would ideally be used to inform the academic and basic skills curriculum for all learners.

A listing of areas of knowledge most in demand by local employers based on projected demand. As one can see, “customer and personal service” should be thematic throughout local curricular experiences as it is most in demand across all occupations. 

The “Long Haul” Tenant and Lowering of Expectations

While the above LOSB suggestions could serve the overall good, the “long haul” tenant is often unfortunately used in local establishment discussions. The “long haul” tends to dash any meaningful expectations in the short term and ultimately results in a lack of accountability as near term milestones are non-existent while lowering expectations and starving out small business with limited resources.

But at any rate, here is a ready to go research base framework to facilitate connected workforce development planning efforts. And then there is also the TIFNI tool, another LOSB innovation,  that addresses a huge local process hole in tax abatement projection accounting…..