According to the World Economic Forum’s 2023 Future of Jobs Report, employers anticipate that nearly half of all workers’ skills will be disrupted in the near future and that the “half-life” of skills is dropping precipitously. Sixty-nine percent of employers surveyed indicate that Artificial Intelligence will create even more demand for worker upskilling in the next three years. Working learners will need more opportunities to gain the necessary competencies through degrees and credentials, apprenticeship and learn-and-earn models, and staff development training programs.  

The benefits to private sector employers from investing in incumbent employee education are well-documented—trained and educated employees are more likely to remain with the company, to be promoted, and to be engaged, productive employees. With an aging workforce and low unemployment, these benefits likely increase. Although the public sector – local, state, or federal government employers – also stands to gain from many of these benefits, it operates under very different constraints:

•   Public sector agencies tend to be risk-averse and process-heavy to protect the state from litigation and prevent the misuse of public funds.
•   Appropriated budgets offer little flexibility to invest in variable initiatives like tuition assistance and large-scale training programs.
•   Agency budgets are frequently limited in growth year-over-year.
•   Staff capacity is limited, and staff members frequently fulfill multiple roles.
•   Data is lacking to generate insights into in-demand skills and roles beyond specific areas (cybersecurity, etc.)

Despite the constraints, though, the need is acute. State and local governments employed 19.6 million people in 2023. In recent years, public sector human resources managers have reported increasing, and in some cases unprecedented, challenges hiring for open roles, and the pay gap between the private and public sectors remains, making it hard to attract and retain the best talent. As state agencies implement governors’ calls to open job opportunities for those without bachelor’s degrees, the competencies needed to take on management and leadership roles will likely shift toward incumbent employees.

Based on some preliminary research, public sector upskilling efforts appear limited. Much of the existing effort is focused on training new and incumbent workers for specific jobs, the role of public sector unions in supporting training among members, and leadership training for specific cohorts. For example:

–    Indiana’s State Learn and Earn (SEAL) program trains workers from diverse professional backgrounds for state IT jobs. Since 2019, the state has hired 57 SEAL associates into paid training roles. Forty-two graduated, 19 transitioned into full-time employment in state IT positions, and the program expanded into four additional state agencies. Indiana also offers paid upfront tuition coverage for state employees who enroll at Ivy Tech Community College.

–    New York’s CSEA is the largest affiliate union of the American Federation of State, County and Municipal Employees and AFL-CIO. CSEA-represented employees can participate in an assistance program that covers tuition, fees, certification, and exam costs. This assistance program also provides access to a wide variety of programs and providers.

–    The Missouri Leadership Academy supports emerging leaders from executive departments to improve their management skills and accelerate their careers. The program supports several leaders from each agency and two cohorts per year, with a curriculum focusing on leadership, people management, and systems change.

These innovative and effective programs suggest a growing recognition of the value of public sector training and career mobility. Public sector apprenticeship programs are also gaining traction.These learn-and-earn professional training models are well-positioned to build the technical and academic skills required for public roles, and the critical “unwritten curriculum” describing how work gets done that can only be learned on the job.

Evidence suggests that workers also value opportunities for skill development and advancement more than just about anything else. 2022 McKinsey research indicated that frontline workers value job growth, learning opportunities, and aligned skill sets just as much as they value pay and having a supportive manager. A 2021 Gallup survey of younger workers found that candidates ranked opportunities for upskilling as an important decision factor in their job search, behind health insurance and disability coverage.

Overall, however, there is a lot we do not yet know about effective public upskilling in current practice, and opportunities for scaled improvements and innovations going forward. We recently had a chance to connect with representatives from more than 20 states who convened for the National Governors Association’s Skills in the States Community of Practice summit. These states are, in one way or another, taking proactive measures to reduce degree requirements in hiring and promotion and towards “skills-first” approaches, in which someone’s qualifications for a position or advancement are assessed based on a more holistic portfolio of skills, experience, and degrees or certificates—which expands the talent pool to more than 70 million Americans who do not have bachelor’s degrees. This work holds great potential for impact because public sector employment makes up a large share of jobs in many states. Still, public sector organizations lag behind the private sector in terms of the share of the workforce without a college degree.

However, removing degree requirements in the hiring process alone is not enough to foster greater mobility. States, as employers, must also offer real opportunities for these employees to learn and grow in their careers to avoid hiring people based on their skills but then encountering roadblocks to further advancement. We talked to state leaders and got their input on the key questions and barriers to public sector upskilling and mobility. The audience pointed to some major knowledge gaps, such as:

•   What are the benefits and costs of investing in public sector upskilling and career advancement?
•   What types of public sector reskilling, upskilling, and career advancement practices are most effective, and for whom?
•   What are the barriers in different states to adopting skills-first processes for hiring, promotion, and career advancement?
•   How can public sector employers formally recognize and reward learning, such as offering a path to a degree (or degree apprenticeship) or having systems that accept and track digital skills data and digital credentials?
•   What are the costs for society, taxpayers, government agencies, and workers of not investing enough in public sector upskilling and mobility?

We are eager to learn more to help unlock opportunities for states as employers and the nearly 20 million state and local employees working to support our communities. In a time of heightened political polarization and debate, efficient and effective public sector systems and processes are critical for restoring trust in government, providing smooth customer experiences that minimize tedious paperwork, and ensuring that taxpayer dollars are efficiently, effectively, and safely deployed. Building a future-ready public sector workforce will require more than just removing degree requirements in hiring; it means investing in skills-first ecosystems so that existing skills are well recognized, there is a culture of ongoing learning, and there is infrastructure that makes career advancement and reskilling transparent with incentives to participate.