Fed Listens: Pandemic Recovery in Austin Communities
The Federal Reserve Bank of Dallas hosted a virtual community listening session to explore how workers, businesses and communities in the Austin area are navigating the economic recovery from COVID-19.
This Fed Listens event, part of a series of discussions held nationwide, contributed to the Dallas Fed’s ongoing conversation with community partners throughout the diverse region we serve. As the Federal Reserve works to support an inclusive economic recovery, understanding the perspectives of a broad range of stakeholders is critical.
Dallas Fed Interim President Meredith Black and Senior Vice President Alfreda B. Norman, along with local leaders from the public, private and nonprofit sectors, discussed economic conditions for lower-income communities in Austin and statewide. Separate panels focused on the labor market and workforce development, employers and business operations, and policy considerations.
Agenda and Speakers:
| 2:00 p.m. |
Welcome |
| 2:10 p.m. |
Community Remarks and Discussion
|
| 3:40 p.m. |
Audience Q&A |
| 3:55 p.m. |
Closing Remarks |
| 4:00 p.m. |
Adjourn |
Summary of Discussion
The Federal Reserve Bank of Dallas held a virtual Fed Listens event on Feb. 22, 2022, focused on economic conditions for lower-income communities recovering from the pandemic in Austin and statewide. The event was hosted by Dallas Fed Senior Vice President Alfreda B. Norman and Interim President Meredith Black. The city of Austin is well-known for its economic prosperity and opportunity; however, many low- and moderate-income (LMI) communities are being left behind and face many economic challenges as our country continues to navigate the long-term effects of the pandemic. The listening session featured local practitioners from the public, private and nonprofit sectors participating in three distinct discussion panels focused on:
- The labor market and workforce development
- Business operations and outlook
- Policy and statewide perspectives
Observations on Economic Recovery for LMI Communities
Although the world has leveraged the power of technology and internet access to navigate the pandemic, Garrett Groves with Austin Community College shared that there have been “difficulties for all families to benefit equally from online or other experiences.” Simply moving a class online may not allow all individuals to reap the benefits and conveniences of an online course, especially if they lack internet access, a quality computer or other resources to allow them to fully focus on that remote learning. Groves added that he often thinks about “an escalator of inequality” in his ongoing work. Using credit scores as an example, he explained that, “starting out with fewer resources [such as a low credit score], it’s like walking up the down side of an escalator. […] If you’re fortunate to have the ability, your credit score gets strong and now you’re on the upside of this escalator, and it’s working with you to move you up ahead.” The pandemic brought on additional challenges for LMI families, including difficult decisions where adults are forced to choose between earning higher wages or investing their limited time and resources into training, reskilling or other learning opportunities. “All these things are a lot harder for our families until we can help them get to a point where our systems are now working for them. […] I’m seeing that divide get much more real for many of our students and it’s, frankly, really alarming,” he said.
Speakers from each panel highlighted ways to support LMI workers including offering child care and wraparound support services, maintaining one-on-one connections to adult students and job seekers to increase persistence through learning and employment processes, and developing accessible pathways for short-term, high-impact learning like training courses, credentials, paid internships and apprenticeships. Employers may offer a higher degree of flexibility, increase wages and benefits and support child care and other support connections for their workers. State leaders and policymakers can better align education and workforce-related opportunities across the state to make them more flexible, accessible and cost-effective for adult workers.
Austin Community Snapshot
Based on U.S. census data (2020 ACS 5-Year Estimates):
- 12.5% of all people living in Austin are experiencing poverty.
- 31.6% of Austin’s population has less than an associate’s degree.
- 32.5% of Austin households make under $50,000. (Source)
- The median annual earnings for high school graduates is $30,973, while median annual earnings for adults with less than a high school diploma is $25,605*.
* Median earnings in the past 12 months (in 2020 inflation-adjusted dollars) for adults age 25 and older. (Source)
- 28.9% of Austin adults are either unemployed or not in the labor force. (Source)
- 10.1% of Austin households do not have an internet subscription. Of the 89.8% of Austin households with some type of internet access, 9.2% have only a cellular data plan with no other type of internet subscription. (Source)
Panel No. 1: Labor Market and Workforce Development
Speakers:
- Garrett Groves, vice chancellor for strategic initiatives at Austin Community College (ACC).
ACC serves over 70,000 students across 11 campuses in Central Texas, providing higher education and technical training opportunities.
- Jennifer Tucker, chief mission officer at Goodwill Central Texas.
Goodwill Central Texas serves over 10,000 people annually and focuses on connecting clients with education, career training and work opportunities to lift individuals and families out of poverty. The organization prioritizes working with community members who may face significant employment barriers such as those with disabilities, criminal backgrounds or who are experiencing homelessness, among others.
When considering labor market and workforce development needs in the first discussion panel, Groves and Tucker highlighted the growing digital divide as work and learning moved to virtual spaces, the need for digital skill-building, and the value of individualized connections with students and clients. Both shared observations that low-income families and individuals have been navigating significant workplace changes, stress, isolation and the fast transition into an online presence. In addition to addressing other training and employment needs, Tucker shared that Goodwill helps their clients bridge that digital skills gap and build longer-term skills in an online world. She explained, “It’s a lot: it’s how to type, how to do your resume, how to be comfortable and have a background in a virtual interview” and more. All those efforts require time, practice, quality internet connections and computing devices, among other resources. Groves shared that many ACC students have also experienced challenges with internet access or device access, which are conducive to learning and completing online classes. Many families may not have a quiet, separate room that can be used for learning and meetings. In thinking about the divide between economically advantaged and disadvantaged populations, he added, “Many of us don’t fully know the extent to which it’s grown, and this is one of the ways it’s grown: if you have reliable Wi-Fi and access to equipment, you can do school more easily online, and you can get space to do so. If you are on the other end of that divide, these things become harder.”
“The Great Resignation [the period of time during the pandemic when many workers quit their current jobs to transition into higher paying, more stable and/or different roles] looks very different depending on where you are in the labor market and your ability to not [have to] work,” said Groves. He explained that there is tension now between obtaining a new job with higher wages that will immediately benefit individuals and families or foregoing increased wages and focusing on upskilling into a new job or a better, long-term career path. The upskilling and learning component may be more difficult for LMI individuals to access due to limited financial resources and lack of career pathway guidance. Groves shared, “We’ve seen a higher level of students slowing down or stopping out [leaving programs or courses] if there’s not a proactive human element to help navigate all these systems [and provide ongoing support].” Tucker said many people got lost when the pandemic started and the world transitioned to virtual spaces because it was difficult for people to know what to do, who to call and how to get help from afar. She added, “making sure that a person has that holistic shepherd or friend or advocate to come alongside them and make sure that they get through [employment or learning processes] is absolutely paramount.” Whether people are participating in virtual or in-person opportunities, both Groves and Tucker agreed that a key lesson learned from the pandemic is that a human connection is crucial for supporting students and clients through successful completion of learning opportunities or finding employment.
Panel No. 2: Business Operations and Outlook
Speakers:
- Sylnovia Holt-Rabb, director of the City of Austin’s Economic Development Department.
Austin’s Economic Development Department is focused on building a competitive, sustainable, equitable economy for everyone. The department supports small businesses and creative professionals, among other employers, by providing technical support, grant and loan options, and individualized coaching for clients.
- Laura Huffman, president and CEO of the Greater Austin Chamber of Commerce.
The Greater Austin Chamber of Commerce is a nonprofit organization focused on enhancing economic development, including contributing to effective policy development for economic opportunity for a five-county region around Austin.
- Bobby Jenkins, owner of ABC Home & Commercial Services.
ABC Home & Commercial Services is a service company, employing approximately 1,000 people, that provides a range of residential and commercial services such as pest management, electrical, landscaping and more.
The business operations and outlook discussion panel focused on business challenges, economic opportunity in Austin and new approaches to attracting and retaining talent, among other topics. ABC Home & Commercial Services was recognized as an essential business early in the pandemic, so it was able to continue operations. As a business owner, Jenkins shared that it was challenging to navigate ever-changing contexts around safety measures like mask usage and vaccination expectations: “Those details were really difficult for businesses to try and navigate because, at the end of the day, we’re all trying to get the work done, but these other issues were really, really difficult to deal with,” he said. Holt-Rabb added that, from her department’s perspective, the pandemic has been particularly difficult for small businesses to navigate local and national regulations, staffing shortages and even technology barriers. She explained, “[Our department] has been here to try to provide that one-on-one technical assistance of, how can you pivot [your business model]? How can you provide online services? A lot of minority-owned businesses didn’t have the technology to do it, but some are now getting back up to speed and learning.”
Huffman agreed with the challenges that Jenkins and Holt-Rabb highlighted but offered another perspective: “This region saw the strongest year of economic development we’ve seen in modern history in 2020.” Despite the difficulties, “we are growing economically at a faster clip than we have in recent years, and I think resilience is a really important storyline for our region,” said Huffman. She cited the strong talent pipeline in Austin as well as the strength of local education institutions as reasons why businesses are attracted to and find success in the region.
When thinking about changes in the workplace, Jenkins shared, “I think there’s been a giant, seismic shift into what the workforce is going to expect moving forward,” including the flexibility of working from home. He shared that his company has already instituted a flexible work schedule, increased wages and refined their benefits package to recruit and retain workers. ABC Home & Commercial Services is focused on finding good people who are interested in the work, and the company is committed to providing a career path, training and additional support for professional growth. As people are searching for better job opportunities, Huffman added, “culture is king and, in a tight labor market, it’s not just about wages; people are shopping culture, especially younger workers.” For LMI workers, Holt-Rabb pointed out the need for quality child care and wraparound services to allow workers to fully focus on work, learning or job hunting.
Panel No. 3: Policy and Statewide Perspectives
Speakers:
- Greg Cumpton, associate director and research associate at the University of Texas at Austin’s Ray Marshall Center.
As part of the University of Texas at Austin’s LBJ School for Public Affairs, the Ray Marshall Center conducts research, program evaluation and policy analysis focused on poverty alleviation through workforce development, education and human capital development efforts.
- Aaron Demerson, commissioner representing employers at the Texas Workforce Commission .
As a state agency, the Texas Workforce Commission partners with employers, workers and the general public in Texas to strengthen workforce development efforts and implement a robust statewide economy.
- Renzo Soto, policy advisor at Texas 2036.
The state of Texas will turn 200 years old in 2036, and Texas 2036, a nonprofit organization, strives to make Texas the best place to live and work by the bicentennial. Its efforts include policy analysis, data-driven decision-making, strategic planning and coalition building across a range of statewide needs.
The third discussion panel, focused on policy and statewide perspectives, highlighted the need to tailor training and workforce development strategies to different student populations, the value of cross-sector collaboration and the need to capitalize on this unique time to test new community-wide strategies and solutions. When asked about policy considerations that state and local leaders should keep in mind during recovery efforts, Soto shared that based on data analysis by Texas 2036, “by our state’s bicentennial [2036], without net migration, our supply of workers is going to miss demand by as many as 2.5 million workers.” To address this looming mismatch, he recommended tailoring outreach and delivery of learning opportunities to two distinct student populations in Texas: one includes traditional young adults transitioning from high school into higher education, while the second population includes older adult workers who may be reskilling, upskilling and training for new job opportunities. “Engaging those adult learners who are coming from the workforce really requires different strategies,” including addressing the need for child care, said Soto. “Creating more accessible pathways for adult learners is going to be just as important as ensuring the traditional Texas students are persisting in completing higher education.”
To develop learning opportunities that directly connect to job-related skills, the state of Texas is working to better align efforts across agencies. Demerson, who represents employers in the state, is collaborating with employers and other partners in “coming up with unique ways to ensure that we’re getting employees back, providing training and providing all types of opportunities.” He added that, “the secret sauce to our success in Texas is when we bring together the worlds of workforce, economic development and education.” Soto highlighted a recently passed bill, HB3767, which formalized The Tri-Agency Workforce Initiative to align the efforts of the Texas Education Agency, Higher Education Coordinating Board and Texas Workforce Commission to address long-term workforce needs. In the future, agencies receiving workforce-related funds will need to align their initiatives to the Tri-Agency's goals to coordinate better statewide outcomes and support more Texans in successfully completing learning and upskilling opportunities.
When thinking about opportunities for Texas to try something new or take new approaches to supporting LMI residents during recovery, Cumpton shared that there are already multiple successful education- and workforce-related initiatives happening at the local level that can inform policymakers. He cited San Antonio’s Ready to Work Initiative and Dallas County Promise, among other examples, which may be expanded across the state. Additionally, Cumpton recommended that we think more expansively to try new ideas at the local level related to addressing larger issues like housing affordability, especially in Austin. “That’s going to be an incredibly difficult thing if we continue to see the rise and [increasing] cost of housing, you’re really just going to price everybody who is low income out of the region.” While many low-income families may be receiving slightly higher wages at this time, he shared that, “my fear is that inflation is going to wipe away those gains, so we want to make sure that we’re thinking forward and thinking about how we’re addressing these larger issues related to cost of living.”