For Immediate Release - December 18, 2012

New Research Finds Cape & Islands Region Facing Challenge Creating Next Generation of Skilled Workers

BOSTON – Tuesday, December 18, 2012 – The Executive Office of Labor and Workforce Development (EOLWD) and the Federal Reserve Bank of Boston today announced that more than half of the region’s civilian labor force (56.4 percent) was 45 years of age or older, while less than one-quarter (23.3 percent) was 34 or younger in 2008-2010. Of the eight Massachusetts regions profiled, the Cape & Islands has the oldest labor force.  As a consequence, the region faces the challenge of equipping younger workers with the skills needed to replace retiring baby boomers. The report, entitled “Labor Market Trends in the Cape & Islands Region,” is part of a joint project between EOLWD’s Commonwealth Corporation and the Boston Fed’s New England Public Policy Center.

“The Patrick-Murray Administration is strengthening pathways for new and incumbent workers in the Cape & Islands by aligning public post-secondary education with the skill needs of employers, especially at the community college level.  Given the aging workforce and the increasing skill levels required in the Cape & Islands, it is critical that we continue to focus on building education and career pathways for residents and workers that support them in advancing into middle and high skill jobs,” said Joanne F. Goldstein, Secretary of Labor and Workforce Development.

The Cape & Islands labor market borders the Southeast regional labor market. It is composed of the 23 Massachusetts cities and towns that make up Barnstable, Dukes, and Nantucket counties. Its larger cities and towns include Barnstable, Falmouth, Yarmouth, Sandwich, and Bourne.

Looking forward, the region faces demographic challenges. In addition to having the oldest labor force in the state, the Cape & Islands was one of only two labor markets to decline in population during the past decade. In 2008-2010, 56.4 percent of the labor force in the region was 45 years or older, making it the only region to have over 50 percent of its labor force at such ages and far exceeding the share in Massachusetts (44.4 percent) and the United States (42.0 percent). Moreover, in the past decade, there has been particularly strong growth in the number and share of people in the civilian labor force who are over 55 years old and a decline in the number of workers between the ages of 25 and 44, and almost no change in the number of 16-24-year-olds.

Even though the region is the oldest in the state, younger workers account for a disproportionate share of the unemployed in the Cape & Islands. While young workers between the ages of 16 and 34 make up 23.3 percent of the labor force, they account for 32.5 percent of the unemployed in the region. “Across the state, our young people are struggling to gain a foothold in the labor market.  Creating strategies to increase youth employment must be a priority.  Early work experience generates important work readiness skills, and a lack of work history leads to a weak connection to the labor market over a worker’s lifetime,” said Nancy Snyder, President of Commonwealth Corporation.

Over the past decade, the level of education for both residents and workers in the Cape & Islands has increased, and the education levels in the region are almost comparable to those in the state.  In 2008-2010, 39.2 percent of the civilian labor force in the region had a Bachelor’s Degree or higher, slightly trailing the 41.2 percent of Massachusetts residents with similar education levels. At the same time, the share of the region’s civilian labor force with some postsecondary education (70.3 percent) actually exceeded the share in Massachusetts overall (67.8 percent) because of the region’s strong concentration of individuals with some college education (including Certificates) or an Associate’s Degree.

“Looking forward, the region faces the challenge of replacing older workers as they retire from the labor market. The coming wave of retirements will likely create attractive employment opportunities for younger labor force participants, but only to the extent they manage to acquire the needed education and skills,” said Yolanda Kodrzycki, Vice President and Director of the New England Public Policy Center at the Federal Reserve Bank of Boston.

The region’s higher education institutions have a critical role to play in influencing the future supply of workers with post-secondary degrees, which will be critical to help meet the demographic challenges posed by the aging workforce and the growing demand for educated workers. More and more individuals have been seeking post-secondary education over the last decade.  The number of students enrolled full-time at two-year and four-year institutions in the Cape & Islands has grown at a faster rate than statewide and nationally, while part-time enrollment at all types of institution in the region has declined.

There has been strong growth in the completion of degrees at institutions in the Cape & Island region.  In fact, over the past decade, the region has led the state in its growth of degree completions in each of the three types of post-secondary degrees (Certificates, Associate’s Degrees, and Bachelor’s Degrees). At public institutions in the region, there was 4.4 percent growth in the number of students earning an Associate’s Degree, compared with 2.8 percent growth statewide, and 3.6 percent growth nationally.  There was 3.1 percent growth in students earning Bachelor’s Degrees at public institutions, compared with 2.5 percent growth statewide and 2.6 percent growth nationally.

However, the post-secondary education sector in the Cape & Islands is relatively small. In 2010, the region had only five post-secondary educational institutions, three public institutions and two private institutions. Nearly 40 percent of the region’s Certificates were awarded by the private Empire Beauty School–Hyannis and 37.5 percent were awarded by Cape Cod Community College. Cape Cod Community College was the source of all Associate’s Degrees completed. The Massachusetts Maritime Academy, the only public Bachelor’s Degree granting institution in the Cape & Islands, accounted for nearly all of the Bachelor’s Degrees (95.9 percent) completed in the region.

Christopher Richards, Chairman of the Cape and Islands Workforce Investment Board (WIB), pointed out that, "The WIB is currently working closely with Cape Cod Community College to ensure that unemployed individuals using our Career Opportunities Center are enrolling in certificate programs which lead to a job. We will continue to work with 4 C's, and also to work with our two local Vocational Technical Schools, to expand the number of certificate program offerings in the region that match up with local employer needs."

The FY13 budget Governor Deval Patrick signed in July begins to address the “skills gap” by adopting the Governor’s proposal to create a more unified, coordinated community college system. The reforms will enable students to transfer their credits more easily and enable local campuses to be more responsive to the needs of local economies as well as of the state’s fastest growing sectors.

Dorothy Savarese, President and CEO of Cape Cod Five, stated that, "The Bank is delighted to join the WIB and the Cape Cod Chamber of Commerce in sponsoring this look at our region's labor market trends. The challenges we face in our region are not beyond our ability to resolve. We support the Governor's skills gap initiative as a part of our commitment to provide our workforce with the 21st century skills needed to support and grow Cape Cod's businesses."

The full report and appendices are available online at http://www.bostonfed.org/neppc .

About Commonwealth Corporation: Commonwealth Corporation strengthens the skills of youth and adults by investing in innovative partnerships with industry, education, and workforce organizations. We seek to meet the immediate and emerging needs of businesses and workers so that they can thrive in our dynamic economy. Commonwealth Corporation is a Massachusetts quasi-public corporation within the Executive Office of Labor and Workforce Development.

About the New England Public Policy Center at the Federal Reserve Bank of Boston: The Federal Reserve Bank of Boston has a decades-long tradition of supporting the New England public policy community. In 2005, the Bank established the New England Public Policy Center to reinvigorate and institutionalize that support. The Center promotes better public policy in New England by conducting and disseminating objective, high-quality research and analysis of strategically identified regional economic and policy issues and, when appropriate, works with regional and Bank partners to advance identified policy options.

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