Overview

Spurred by technological advances and globalization, the U.S. economy has been transformed in the past 25 years. An industrial economy driven by raw materials and physical output has given way to a new, knowledge-based economy driven by ideas, services, and innovation. These economic changes have led to fundamental changes in the labor market and the demand for education and training. Knowledge-based jobs, which require some combination of postsecondary education or vocational training, have been among the fastest-growing jobs and have increased as a share of total employment.

Skill requirements in high-technology and other industries have been rising as a result of the increasing use of information technology. Education and skill have become increasingly important as paths to higher earnings and career growth. Recognizing that a skilled workforce drives the new economy, governors in leading-edge states have begun to rationalize and modernize state workforce development systems to meet the needs of workers and employers. They have overhauled the governance and administration of most workforce development programs through executive order or state legislation.

Related Links:

• Aligning State Workforce Development and Economic Development Initiatives (pdf)
• The Next Generation of Workforce Development Project: Connecting Workforce and Economic Development Policy
• A Governor's Guide to Cluster-Based Economic Development - NGA provides governors with the tools for structuring economic development policies to help make business clusters more innovative and competitive.