Lisa Katz| Crain’s Detroit Blog
In early 2012, a state review of workforce program delivery in Detroit cited a track record of poor outcomes and failure to meet numerous federal performance targets. The review requested development of a corrective action plan.
After carefully examining the experience of other cities that had shifted their workforce operations outside of government control, Mayor Bing opted to move the city’s workforce operations and oversight to an external corporation. This new entity, Detroit Employment Solutions Corp. (DESC), a Michigan Works! agency, took on the role of fiscal and administrative agent on July 1, 2012.
The decision was controversial at the time, but a year later, it is clear that it has delivered positive results. From an operational standpoint:
- The costs of doing business has decreased more than 30 percent.
- Forty-eight full-time roles under the city structure have been reduced to 34.
- Vendor payment processing has shifted from 60+ days on average to no more than 15 days.
- Contract approvals that used to take more than six months are now being processed in an average of eight weeks.
Meanwhile, new investments in technology have enhanced service delivery. DESC upgraded servers and desktop environments, improving on older city technology. It also made considerable investments in tracking customer relationships, for example, moving away from manual data entry for employer contacts and job request fulfillment in favor of a highly regarded CRM database. For jobseekers, DESC invested in a solution that allows the organization to track individuals at every point of service. Beforehand there were risks of data corruption at different handoffs as customers moved through the system. Technology changes have allowed greater efficiency and DESC to make more sound, data-driven strategic decisions.
DESC also has seen programmatic improvements for both jobseekers and employers. The One-Stop Service Centers that DESC operates throughout Detroit have seen great increases in activity, jumping from 114,794 visitors in the last full program year (ending June 30, 2012) to 133,519 (16 percent) in the first 10 months of the current year. Placements (the number of customers who have found a new job) have doubled over the same period.
Meanwhile, DESC’s Business Services Division is increasingly engaging with major Detroit employers such as Detroit Manufacturing Systems and Meijer. By the end of June, these two firms alone hired nearly 1,000 candidates that DESC recruited and screened. The agency’s hiring events proved so successful that Meijer brought its out-of-state HR personnel to learn DESC processes.
Perhaps the greatest indicator that DESC is on the right track now is performance against federal targets. Since the time the state first asked for corrective action 18 months ago, the new organization has met every one of its 17 key federal performance targets and exceeded 13. This means greater accountability from the publicly-funded system.
Talent stakeholders across the region and nationwide are encouraged by the policy shift to nonprofit status in Detroit. As Detroit Employment Solutions Corp. enters its second year, it faces challenges like sequestration and continually dwindling federal funding, but it seeks to overcome these gaps by attracting more public-private partnerships. It is clear is that new freedom in the Motor City has been good to the workforce system and, most importantly, those who rely on it.