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Richmond, Virginia

Richmond, Virginia, is unique among the five cities on which the workshop series focused in that it is a capital city, with its large government workforce. As a result, there were several interesting state and local partnerships that this workshop, the third in the series, explored. At the same time, the city of Richmond, similar to the cities of Birmingham and Boston, had a much higher poverty rate, lower median wage, and more economic stress than the Richmond metropolitan area. As was the case for the previous two workshops, this one began with an overview of the economic situation in the city and surrounding metropolitan area, with the caveat that there are data through 2019, but up-to-the-minute economic data that can inform policy and practice are difficult to collect. This workshop also illustrated some of the ways in which Richmond’s education and training programs have responded to the COVID-19 pandemic and how state and local policies and programs are meeting the challenges created by the pandemic.

UNDERSTANDING THE ECONOMIC AND WORKFORCE IMPACTS OF COVID-19 ON RICHMOND

In the workshop’s first session, Stuart Andreason, director of the Center for Workforce and Economic Opportunity at the Federal Reserve Bank of Atlanta; Leonard Sledge, director of the Department of Economic Development for the city of Richmond; and Sonya Waddell, vice president and economist with the Regional and Community Analysis group at the

Federal Reserve Bank of Richmond, framed the workshop discussions by sharing economic, labor force, education, and demographic data for the Richmond metropolitan area and comparing the data to those from the state of Virginia. Alastair Fitzpayne, executive director of the Future of Work Initiative at the Aspen Institute, moderated a discussion with the panelists following their presentations.

Waddell noted that the Richmond metropolitan area has grown since the mid-1990s, although not as much as other similarly sized cities elsewhere in Virginia or in the South. Population growth in the city has also outpaced that of the metro area over the past decade as people move back to the city from its suburbs. In terms of employment growth and business formation, the city of Richmond has performed better than the United States as a whole. From her perspective, Richmond did not see the explosive rise in housing costs that northern Virginia, a suburban area adjacent to Washington, DC, saw prior to the COVID-19 pandemic, and the city had a strong base in professional business services and the types of jobs that could be done at home. It also has a large base in growing industries such as education, health services, trade, transportation, and utilities. Waddell explained that one thing that has hurt the city during the pandemic is that it had started to become a food and vacation destination, which led employment in the hospitality sector to more than double over the past few years and consequently crater, declining by 40 percent during the pandemic. At the time of the workshop, employment in the leisure and hospitality sector of Richmond’s economy had recovered to about 80 percent of pre-COVID-19 pandemic levels.

With regard to poverty rates and wages, Andreason said that in 2019, the poverty rate and median wages in Richmond were 18.9 percent and $31,216, compared to 5.6 percent and $36,098 for the Richmond metro area, an imbalance that has existed for a considerable time. The demographics of the city and its metro area are significantly different, with the metro area being predominantly white and the city being more diverse with a nearly equal mix of Black and white residents (Figure 4-1). The difference in educational attainment between the city and metro area is relatively small, Andreason said, although the metro area does have an overall higher level of educational attainment (Figure 4-2). There is a high concentration of workers that have a high school degree or less in the city compared to the metropolitan area.

Unemployment in the Richmond metro area spiked around April 2020, hitting slightly over 11 percent, and women, adults under age 35, and Black residents were disproportionately affected. Across Virginia, while

women made up 47.1 percent of the workforce, they constituted 55.7 percent of those who claimed unemployment benefits; people under age 35, who constitute 31.2 percent of the workforce, made up 42.3 percent of claimants; and Black people, who constitute 19 percent of the workforce, made up 38 percent of claimants (Figure 4-3).¹ During the week of September 26, 2020, some 47,000 more workers were on the new Pandemic Unemployment Assistance Program for gig workers or those otherwise unqualified for traditional unemployment than on traditional employment. In Virginia, many of the job losses have been in hospitality-related fields (Figure 4-4).² Andreason commented that the retail sector job losses accounted for a smaller share, at 6.7 percent of unemployment claims, than in the other two cities examined thus far.

Andreason explained that automation, as well as the COVID-19 pandemic, presents a risk of permanent job loss depending on a region’s mix of jobs. The Richmond metro area’s mix of jobs that are at risk of being lost permanently is similar to other portions of the south and mid-Atlantic regions, said Andreason, with those jobs at greatest risk being retail positions, cashiers, restaurant wait staff, cooks, and receptionists. The same

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¹ Only state-level data were readily available, and Andreason noted that there are regional differences in the state.

² Unemployment claims by industry were only available by state, and not by city or metropolitan area.

can be said for the Richmond metro area’s middle-skill, high-paying job mix in terms of its similarity to that of other southern and mid-Atlantic states. He noted that the Richmond metro area appears to be slightly more exposed than the rest of the state to permanent job loss and the percentage of workers who would be able to work at home.

Regarding internet connectivity, of key importance in allowing people to work or study at home, Andreason noted that the most recent data available show that across the Richmond metro area 85 percent of all households

have an internet subscription and 70 percent have a high-speed connection, compared to 82 percent and 68 percent, respectively, in the city proper. Slightly more than 11 percent of all households in the metro area, compared to 13 percent in the city, can only access the internet via their cellular plans. Andreason added that 39 percent of households in the metro area earn less than $20,000 annually and do not have internet access at home, compared to 35 percent of all households in the city. He also said that 78 percent of all households in the Richmond metro area have a computer at home, compared to 73 percent in the city. Some 9 percent of residents in the metro area rely on a cell phone for internet access, compared to 13 percent in the city, and 7.5 percent of residents in the metro area versus 9.4 percent in the city do not have a computing device at home.

Discussion

Sledge noted that the city of Richmond is focusing its efforts on and emphasizing equity and inclusion in its economic development activities so that Black and brown communities receive the benefits of these efforts. When asked whether there are any indications that the food service and hospitality workforce is exploring potential transitions to other industries, Sledge said that there is anecdotal evidence that individuals in the leisure and hospitality industry have been able to find employment in warehousing and logistics. He also noted that Richmond is now seeing a significant number of new restaurants and other hospitality and food service establishments opening, and there are employers looking for people even within the food service, hospitality, and restaurant industry. Waddell added that the pandemic-induced recession has been different from previous recessions in that the industries affected the most were those with a workforce less resilient to sudden changes. This suggests that retraining will be critical and that community colleges will need to play a large role in that retraining effort.

Andreason noted that he has been seeing people transitioning from hospitality to entry-level healthcare positions. He also pointed out that some sectors of hard-hit industries such as retail have been growing during

the pandemic, for example, home improvement stores and grocery stores. In general, there has been less of an effect on science, technology, engineering, mathematics, and medicine (STEMM) fields, in part because there are ongoing increases in demand for STEMM employees, but also because many STEMM jobs can be done remotely.

One reason why Richmond has weathered the economic crisis caused by the COVID-19 pandemic a little better than other regions, said Sledge, is because of the presence of state government, local government, three research universities, and a major hospital system, as well as a major presence of banking and finance companies that can have their employees work remotely. He also noted the importance of the life sciences industry that is developing around the area’s three major research universities and of making sure that the region’s institutions of higher education are training a workforce capable of filling the jobs that industry is creating.

Fitzpayne commented that before attending the workshop he reviewed the most recent Summary of Commentary on Current Economic Conditions issued by the Federal Reserve Bank and saw that many businesses in the Richmond metropolitan area reported having difficulty filling positions.³ Being somewhat surprised by this situation during a period of elevated unemployment, he asked Waddell if she has been hearing that from Richmond’s businesses. Waddell replied that she had, but that unmet labor demand varies significantly by industry. For Richmond, the industries where the supply of labor is not keeping up with demand include construction, skilled trades, and manufacturing, with jobs in those areas requiring six months to a year of community college education. Sledge added that he has heard of companies in the area that are starting their own training programs to meet their needs for a trained and skilled workforce.

Andreason asked the other panelists whether Virginia’s impending fiscal challenges—the same challenges that other states around the country are forecasting—will affect the local job market given that Richmond is the state capital. Sledge replied that the city had to make a $40 million adjustment to its budget once the pandemic hit, which led to a freeze on hiring and discretionary spending. However, local government is now filling some positions, although he was uncertain what the state government was planning in the future.

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³ Also known as the “Beige Book,” this report is published eight times a year, and it summarizes current economic conditions in each Federal Reserve district. See https://www.federalreserve.gov/monetarypolicy/beige-book-default.htm.

RESPONSE OF RICHMOND’S EDUCATION AND TRAINING INFRASTRUCTURE TO THE COVID-19 CRISIS

The workshop’s second panel discussed how the pandemic has affected workforce education and training programs for Richmond-area residents. The five panelists were Paula Pando, president of Reynolds Community College; Hakim Lewis, president of Virginia Union University; Peter Buckley, dean of the Virginia Commonwealth University School of Medicine; Brian Davis, executive director of the Capital Region Workforce Development Board; and Mark Barth, president and chief executive officer of Goodwill Central and Coastal Virginia. The session was moderated by Jane Oates, president of Working Nation, a nonprofit that works to create and amplify solutions for a changing economy, and former assistant secretary at the Employment and Training Administration of the Department of Labor.

Reynolds Community College, explained Pando, is one of 23 community colleges in Virginia and one of the four largest in the state, with four campuses in the Richmond area including one campus that houses its culinary hospitality and entrepreneurship programs. Community colleges, she noted, are a uniquely American invention, one created to fulfill a national belief that no person should not have access to quality postsecondary education or training, regardless of their life circumstances. She also commented that community colleges are not a destination but rather a pathway to further education or a job that leads to a living wage. At her institution that pathway includes partnerships with businesses and industries that need a skilled and diverse workforce, with K-12 education, and with various community partners that want to invest in Richmond’s future.

Virginia Union University, explained Lucas, was started in 1865 in a jail in a town that was a cornerstone of the infrastructure of slavery. Through the perseverance of its first students—who were educated in that jail—and the community, the school now offers degree programs leading to bachelors, masters, and doctoral degrees for underprivileged individuals living in the Richmond area.

Buckley noted that Virginia Commonwealth University’s focus during the pandemic has been to prevent job loss, continue to train healthcare professionals, and help the Richmond area safely open for business. Toward that end, the VCU Health System collaborated with local businesses to produce personal protective equipment, helped to educate the Hispanic and Latinx community about mask mandates, and launched an initiative to

assist businesses and universities to reopen and provide guidance and testing strategies to prevent the spread of the novel coronavirus. VCU Health Systems also safely restarted in-person learning that is essential for licensure and credentialing of urgently needed healthcare professionals.

Connecting Job Seekers to Training Opportunities

Davis explained that Virginia Career Works is not a training provider but a connector that links job seekers to training opportunities and to employers in need of a trained and skilled workforce. In 2019, its three regional workforce centers served some 30,000 clients, placing 85 percent of them in jobs with an 80 percent retention rate and helping 75 percent attain the credentials needed for those jobs. He noted that at the time of the workshop, 8,300 employers had posted 40,674 jobs covering 716 different occupation types during the past 30 days. There were 466 unique certifications associated with those jobs, with six of the top 10 certifications pertaining to healthcare jobs. Projections for the year ahead showed that jobs with the highest projected growth were in healthcare, food preparation and food service, business and financial operations, and the construction trades. The challenge, he said, will be retraining individuals to fill many of those jobs given that 52 percent of people who lost jobs because of the pandemic have no postsecondary education.

Goodwill’s mission, said Barth, is to help people help themselves through the power of work, and it does so by helping to address barriers to employment, whether those barriers are, for example, an intellectual or developmental disability, a criminal record, or a lack of transportation. In short, Goodwill’s role is to get people on the pathway that Pando discussed. In 2019, Goodwill in Virginia placed 6,000 people in jobs.

Discussion

When asked how the COVID-19 pandemic has affected the way they do business, Barth replied that the biggest impact came from the closure of the Goodwill stores that fund its employment centers, costing the organization $9 million in revenues. Fortunately, Goodwill had received a grant in 2019 to pilot moving its offsite services, such as training, to locations it will share with other nonprofits in Richmond. Because that pilot program was successful in terms of meeting individuals where they are in the community, Goodwill is going to move to that model. He acknowledged, though, that

this is a big shift for an $80 million organization that has been doing things the same way for 40 years.

Pando said that if there is anything that has been remotely positive about the pandemic, it is that higher education has accomplished tasks that she and others in the field thought would have been impossible, such as moving 900 class sections online in a matter of days. In her opinion, rethinking the entire model of postsecondary education will benefit the people who come to her institution. The pandemic also forced Reynolds Community College to lean into its values when it came to deciding what programs to cut in order to make room for expanding the programs that will train students for well-paying jobs and family-supporting careers.

At Lucas’s institution, the pandemic has accelerated the processes that required thinking of education as more of an entrepreneurial business. In fact, he now thinks of Virginia Union University as an educational technology startup that is building a business incubator and accelerator for people of color. He also noted that the realities of the Black Lives Matter movement on the heels of the COVID-19 pandemic and its disproportionate effect on Black and Latinx individuals revealed that access is the primary barrier to workforce development, training, and eventual employment. One aspect of his institution’s response has been to create new certificate programs and master’s degrees, as well as an associate degree, as a way of recruiting a diverse student population.

Davis said the Capital Region Workforce Development Board has not gone through the same seismic shift that educational institutions have had to endure, but one shift it did have to make was to learn how to remain eligible for federal employment and training program funds in a virtual format. This involved installing new systems for verifying signatures and program eligibility and transmitting personally identifiable information electronically. He said his organization has done a good job staying in touch with current clients, but new client enrollment has fallen since the pandemic began.

One of the most radical changes for the VCU Health System was going from approximately 80 telehealth visits in any given week to nearly 6,500 once the pandemic started. This change did not merely affect the delivery of care, but also forced Buckley’s institution to determine how to best train the workforce to deliver care in this new virtual environment. He acknowledged how important the community’s outpouring of support for VCU Health System’s workforce has been in terms of the morale and loyalty of that workforce as well as in increasing the community’s interest in careers in healthcare and science.

Regarding how their institutions are pushing for more universal STEMM education, particularly for populations that are underrepresented in the current STEMM workforce, Pando said that her institution’s laser focus is on people living in communities of color—that is, on who enrolls at Reynolds Community College—and getting to those individuals and communities early to make them very aware that there are careers in STEMM that pay well, not just in social work or human services. She then challenged her business and industry partners to do a better job of providing role-modeling types of relationships to students in middle school, when they are starting to consider what careers they might like to pursue. Many of the students her institution serves have never heard of a welder, seen an electrician, known what a lab technician does, or been aware of the difference between a registered nurse and a certified nursing assistant. In addition, representation matters when it comes to role models, she said, because students relate more when the role model looks like them or comes from the same type of background.

Van Freeman, director of the Aerospace Industries Association’s future workforce development and strategy initiatives, asked the panelists what the colleges and universities in Virginia are doing to alleviate the burden on students of color who are trying to enter STEMM fields, given that they are likely to have more student debt that their white counterparts. Lucas replied that Virginia Union University’s approach has been to build degree programs that lead to well-paying STEMM jobs and to procure opportunities for them to get hands-on experiences in those fields, allowing students to conduct research in a laboratory and earn while they learn.

Buckley said that the VCU Health System has been on a long-term journey to match its trainees’ ethnic and social distribution with that of the state’s population, because people have the best health outcomes when they are cared for by somebody of similar racial and ethnic background. He noted, too, that the outpouring of financial support his institution has received during the pandemic will allow it to support the debt of its students of color, which he hopes will convince more of those students to practice in the community once they finish their training.

INNOVATIVE WORKFORCE SOLUTIONS: HOW STATE AND LOCAL POLICY AND PROGRAMS ARE MEETING THE COVID-19 CHALLENGE

The day’s third panel examined post-COVID policy responses and investments in workforce training programs, including the effect of the

pandemic on workforce alignment and learner access. The five panel members were Megan Healy, chief workforce advisor to Virginia Governor Ralph Northam; Valaryee Mitchell, director of the city of Richmond’s Office of Community Wealth Building; Caren Merrick, chief executive officer of the Virginia Ready Initiative, a newly established nonprofit organization formed in response to the economic hardships created by COVID-19 that works with local partners to reskill people for in-demand jobs in high-growth sectors; Elizabeth Creamer, vice president of workforce development and credential attainment at the Community College Workforce Alliance, a community college partnership that provides non-credit training, custom-designed instruction, consulting, skills assessments, and educational programs; and Nat Marshall, chair of the Virginia Board of Workforce Development. Anna Payne Fife, associate director for outreach and engagement for the Aspen Institute Future of Work Initiative, moderated the discussion among the panelists after their short presentations.

Credentials to Move People into Recession-resistant Industries

Healy noted that the state has done relatively well avoiding layoffs of employees at the high end of the salary range, many of whom were able to continue teleworking, so the challenge going forward is moving people who worked in lower-wage jobs in restaurants and retail into recession-resistant industries such as those that are STEMM-based. Three important pieces of addressing that challenge will be providing wrap-around supports for students and workers, including childcare and transportation; using an equity lens when launching new programs; and leveraging technology to make worker training accessible and affordable for every resident who needs it. The equity lens is key, said Healy, to avoid what happened during the recovery from the 2008 recession, when it took people of color longer to find jobs and recover economically.

Creamer’s organization, the Community College Workforce Alliance, serves more than 9,000 regional residents per year, providing employees for over 200 businesses and organizations in the region. To get residents of greater Richmond back to work, her organization works through industry sector strategies that focus on specific industries and then uses what she called FastForward workforce credentials, apprenticeship programs, and pre-employment training.⁴ It also does contract training for business

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⁴ Additional information about FastForward workforce credentials is available at https://www.fastforwardva.org/.

and has programs to upskill incumbent workers, and it recently joined a regional workforce development coalition called Network to Work.

Merrick explained that after studying the local economy in detail and interviewing 35 of Virginia’s top companies to see where the job openings were concentrated, the Virginia Ready Initiative partnered with the Virginia community college system to recruit people into the FastForward credentialing program to train people for jobs in healthcare, manufacturing, the skilled trades, and information technology and cyber technology. The most popular credential so far has been for billing and coding, which opens the door for great jobs in healthcare, she said. The initiative is recruiting people who are unemployed or underemployed or whose employment has been disrupted by the COVID-19 pandemic to take one of 30 credential programs. Those who take advantage of the program and receive a credential are awarded $1,000 as an incentive and become eligible to take advantage of jobs posted by any of the 23 Virginia businesses (and counting) that have partnered with this program and that help with curriculum updates at the state’s community colleges. Merrick noted that some of the business partners had never worked with a community college and said that the goal is to have 2,000 people finish this program by the end of 2020 and to have supported a minimum of 15,000 people over the next two years.

Discussion

When asked whether Richmond was deploying any creative solutions to address the broader challenges and obstacles, such as lack of childcare, transportation, and internet access, that affect workers’ ability to secure employment and stay employed, Mitchell described an initiative begun by the Office of Community Wealth Building called the ambassadors program. Through this program her office recruits community members who act as two-way conduits of information, sharing information with the community and providing information about community needs to her office and to other partners. One surprising finding by the ambassadors was that many community members were not aware of food programs and COVID-19 testing sites, even though the city had a significant social media effort and created websites to publicize these programs. The problem was that too many of the people the programs were intended to support did not have internet access or a smartphone and were therefore essentially blind to the social media effort. Within a week of discovering this problem, the ambassadors were blanketing the community with paper notices about these

programs. The city, said Mitchell, is also working to increase the number of cell phone towers near Richmond’s public housing communities as a means of addressing this access problem.

Regarding childcare, the city has partnered with the YMCA, which reduced its price for childcare so that low-paid essential workers could afford it. The city is also working with other childcare providers to see how they can work together to provide more affordable and safe childcare for workers who cannot afford to pay $150 per week. Her office is now going into the community to make sure that school-age children are, in fact, engaging in virtual learning, and if not, to look for solutions to whatever barriers are keeping them from participating in online schooling.

When asked about the policies the state has implemented since the COVID-19 pandemic began, Healy said one of the first actions the governor’s office took was to create one website to serve as an access point for all available data on regional workforces. The state has also developed an online referral tool that individuals can use to enter their information and get referrals to jobs or social services, and has secured federal funds to address those social needs. The governor allocated $5 million for community colleges to “flip” their workforce training pathways so that job training, rather than coming later in a student’s course of study, starts on day one. Someone who wants to be a welder, for example, will start with a welding class, not English or math.

When asked whether she is finding it harder to develop partnerships during the COVID-19 pandemic, Creamer said that there has been renewed energy around establishing partnerships thanks to work that had been done before the pandemic. The Virginia Ready Initiative, for example, formed quickly once the pandemic began. She noted, too, that employers in the region are more conscious of the need to work in partnership with community organizations to address systemic racism and fundamentally change the outcomes at all levels of education for students of color. The result of that increased awareness is a great deal of effort around addressing the digital divide and increasing access to childcare and transportation, with the goal of better preparing students for family-supporting jobs. Creamer added that there are now 39 different groups—public, private, and philanthropic—coming together to lend their talents in a coordinated way to address local inequities. In short, there has been “an explosion of interest in partnerships,” as well as a commitment among employers to guarantee jobs in manufacturing, logistics, and healthcare for students coming out of the many programs that were discussed during the day’s workshop sessions.

Marshall commented that industry partners need to do more than just have jobs available, and should work with community college and economic development partners to train workers to fill those jobs. In his opinion, employers need to go into schools and talk about the kinds of jobs that students can get with some postsecondary education, and that employers should do so regularly and repeatedly. As an example, he has gone into middle and elementary schools talking about the opportunities for machinists, who can start with wages in the $30 to $45 an hour range, with time-and-a-half pay on Saturday and double time on Sunday. When the students think about that possibility compared to the minimum wage they could make working at a fast-food restaurant, they get excited about work possibilities.

In terms of actions the panelists would like to see from the federal government to help more Virginians return to good jobs, Merrick said she would like to see the federal government revisit the types of security clearances needed to work for a federal contractor or for the federal government. Those security clearances can be a barrier, and she suspects that some of positions do not need one as high as is currently required. Creamer said she would like to see the federal government make it easier for working adults to get ahead by accessing federal financial aid or workforce training at community colleges and universities, particularly for part-time students. Marshall wanted to have the federal government continue to support increasing broadband internet access for everyone in the state, and Mitchell said she would like to see the federal government look at the “cliff effect” for benefits. The cliff effect occurs when people who are receiving benefits start losing them rapidly when they do get a job, which often leads to people struggling to pay for the childcare and transportation they then need to keep that job.

Healy agreed with all of the suggestions and stressed the need to support both training and wrap-around services. As she noted, life is expensive, and navigating those expenses for someone embarking on a new career path can be overwhelming. Any support that students can receive will improve their chances of succeeding.

CLOSING REMARKS

To conclude the workshop, Andreason and Josh Carpenter, director of economic development for the city of Birmingham, provided summaries of the key themes, challenges, and policy opportunities they heard over the

course of the day. Andreason noted the great opportunities for cross-sector collaboration and the need for federal action. He was struck by the need to address credit checks, which can also be a barrier to employment for people who, for example, lost their homes during the pandemic. Employers, he said, need to decide whether credit checks, in the current environment, are a relevant criterion.

Carpenter was impressed by the resonance he heard among the different panel members regarding the need to shift institutional focus and work in partnership to address the immediate and long-term economic issues highlighted by the COVID-19 pandemic. In particular, he thought that the Richmond workforce system was well connected across the community, thanks to leadership that was willing to be adaptive and form partnerships. Community college leaders, for example, have been receptive to changing their offerings, even overhauling the design of their courses, in order to better meet the needs of local employers. Based on what he heard over the course of the day, Carpenter said that rethinking the way postsecondary education is funded is essential if the goal is to help people who have been disadvantaged get the training they need to secure better-paying jobs. He also highlighted the importance of increasing students’ exposure to potential jobs early on and going into schools to talk to elementary and middle school students about career opportunities with relatively better-paying jobs.