U.S. Regions See Promising Industry and Workforce Gains from Federal Investment

Grantees of the Build Back Better Regional Challenge have seen early successes, but would benefit from more sizable–and scalable–grants and more flexibility, according to regional leaders and a new Brookings Institution report.

Roughly two dozen U.S. regions, many of them battered by decades of economic distress, are starting to benefit from a $1B “place-based” investment by the Biden administration—intended to advance major industries and emerging technologies and upskill the labor force in those communities.

That’s according to a handful of awardees of the Build Back Better Regional Challenge and a major analysis of the program released yesterday by the Brookings Institution. The analysis focused on insights from the first year of the program that could be applied more broadly. It found early successes in helping local economies and workers but also called for greater funding and more flexibility in future place-based work.

Overseen by the U.S. Economic Development Agency and funded through the American Rescue Plan Act, the BBBRC awarded between $25M and $65M to 21 regional coalitions in 2022. The project, which challenged awardees to conceive a regional strategy to revitalize local economies, is part of a broader federal package of investment such as the CHIPS and Science Act, the Infrastructure Investment and Jobs Act, and the Inflation Reduction Act.

“Build Back Better … has shown a lot of great progress,” Alejandra Castillo, U.S. assistant secretary of commerce, said at an event on Tuesday hosted by Brookings and Duke University. “It’s asking the community to tell us what they believe are their best assets. What they believe is the arc of the economic future.”

It’s novel in that regard, she said. “Government usually has told communities what to do, how to do it, when to do it. This time we’ve turned the table and listened very closely to all of these different locations.”

A recent study by researchers at Brookings and the W.E. Upjohn Institute for Employment Research found that the most economically distressed U.S. counties saw modest job growth in recent years in the wake of federal place-based policies. However, the report stressed more policy interventions are required to reduce employment rate gaps.

Speakers at this week’s event included representatives from regional coalitions in southeast Michigan, southern West Virginia, and North Carolina. The influx of federal dollars enabled them to scale strategies already underway in their areas and deepen collaboration between various stakeholders such as universities, labor unions, employers, and philanthropists.

Brandon Dennison, vice president of economic and workforce development at Marshall University and founder of Coalfield Development, has spearheaded a new model of workforce development in southern West Virginia, supporting new and existing employees with on-the-job training, community college classes, and life skills coaching, as the region transitions toward cleaner energy.

  • Dubbed 33-6-3, the model provides workers with a 2.5-year contract consisting of 33 hours per week of paid work, 6 credit hours of higher education, and 3 hours of mentorship. 

“We don’t want to take a generation to get to the new diversified economy that we think we deserve, but it’s not going to just happen overnight,” said Dennison. “And it’s going to take a lot of wraparound support and we have to invest in our people as well as our sectors in order to get there.” 

So far, Dennison said, the workforce development model has created 400 new full-time jobs and trained 500 new workers. 

A Focus on Equity for Workers

For many of the regions, creating equitable workforce development strategies has been a major priority, particularly for historically marginalized communities. 

Amid a boom in life sciences research and manufacturing, leaders in North Carolina are developing a talent pipeline at the state’s historically Black and Native American colleges and universities, offering a two-week short course training in biomedicines with minimal eligibility requirements. 

“Just creating the training is not enough,” said Manju Bhat, a dean at Winston-Salem State University. “We have to make them accessible to the communities that we live in.”

The region’s coalition is setting up labs at minority-serving institutions across the state, aiming to train 280 people annually. By the time students complete their training, Bhat added, they will be certified to work in the life sciences manufacturing industry and could earn a starting salary of $55K.

The Brookings analysis featured a series of case studies that is part of a two-year research collaboration with the Economic Development Administration, which oversees the BBBRC, to examine early successes and challenges experienced by program awardees.

Among a host of lessons and insights it gleaned, the think tank emphasized that future “place-based investments will need to be more sizable and flexible,” providing regions with enough capacity building to scale their strategies.

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