Mike Grundmann will lead Virginia’s rapid workforce solutions program. Photo credit: Virginia Business
by James A. Bacon
When Stephen Moret was hired to run the Virginia Economic Development Partnership (VEDP) two-and-a-half years ago, one of his main selling points was his accomplishment of creating Lousiana’s FastStart workforce solutions program and building it into the top-ranked workforce development program in the country. Now Moret is assembling a team to build what he calls a “world-class, turnkey, customized workforce recruitment and training incentive program” for Virginia.
Mike Grundmann, a veteran of Georgia’s highly regarded Quick Start program, has been hired as VEDP’s new senior vice president of workforce solutions. At Quick Start he oversaw development of more than 100 custom workforce solutions. By this time next year, Moret expects to have hired 12 full-time employees toward an eventual staff of 50, reports Virginia Business magazine.
Moret sees the workforce solutions program as a complement to Virginia’s community college system, which also collaborates with business to provide workforce training and credentials. The difference: “We’re also selling speed. Sometimes you’ll have a company say, ‘I’ve got a plant in Germany. I essentially want one just like that in the United States, and I want to have it up as quickly as possible.'”
In the current low unemployment environment, recruiting and training employees is a service companies find very attractive, Moret says. And they’ll find it especially valuable, he adds, when they learn that it would cost them three to four times as much to develop the same level of customized recruiting and training services that VEDP can offer for free. (VEDP estimates it will spend $800 to $1,000 per job position for recruiting and training.) …
Adds Moret: “We’re not producing any credentials … [or] degrees. … It’s literally recruiting and training people not just to be a welder or an electrician but to be a welder for this particular company, this particular plant.”
Bacon’s bottom line: After his big win with Amazon and his success in restoring Virginia to the top of CNBC’s Top States for Business ranking, Moret has gained enormous credibility in Virginia. People know he can deliver. If he says a rapidly deployable workforce development program is what Virginia needs to recruit more investment, he should have no trouble winning financial support from the General Assembly.
An interesting philosophical issue arises here: Does Moret’s workforce program amount to corporate welfare? The subsidy of $800 to $1,000 per worker provides recruitment and training services that companies are perfectly capable of carrying out themselves.
I would argue that, yes, it does amount to corporate welfare, but in the universe corporate welfare with its endless variations and permutations — tax credits, tax exemptions, direct subsidies, indirect subsidies — rapid workforce deployment probably offers the biggest bang for the buck.
First, a $1,000-per-employee subsidy (as measured by cost to VEDP) delivers $3,000 to $4,000 in value to the company (what it would cost the company to set up recruitment and training functions itself).
Second, the program offers speed. When corporations decide to build a new manufacturing plant, they typically are responding to current market conditions, and they want to ramp up as quickly as possible. Time-to-market is critical. The main reason Moret advocates more industrial shell buildings is to reduce time spent on permitting and construction. The combination of shell buildings and rapid workforce deployment speeds time to market and reduces uncertainty. Time is something that corporations can’t buy.
When fully funded, the rapid workforce deployment program will be staffed to work with 100 businesses a year. Unlike the massive Amazon and Micron projects, in which the state provided multimillion-dollar subsidies for individual projects (albeit very large and lucrative ones), the VEDP workforce program will benefit all regions of the state.
