State Policy Road Map for an Equitable Economic Recovery

Call to Action

As they confront the ongoing economic impact of the COVID-19 pandemic, state and local leaders shouldn’t focus on “getting back to normal.” Instead, they should look to leapfrog normal and aim for something better. As the nation’s laboratories of democracy, states have an unprecedented opportunity to fix systems and policies that have been producing and perpetuating massive disparities in education and skills, career opportunities, and economic well-being.

The fault lines that create and reinforce those disparities existed long before the novel coronavirus arrived, businesses and schools closed down, and protests over racial injustice erupted.

The multiple crises that began in 2020 have merely magnified and exacerbated the societal and economic circumstances that often determine whether people can keep themselves and their families safe, healthy, and financially secure right now, and whether they will be able to advance in the jobs of the future.

Growing disparities in well-being and opportunity should matter to us all because the plight of disadvantaged populations truly affects everyone. Inequality puts a strain on the vitality and competitiveness of metropolitan areas and small towns alike. But when all people throughout a community have a fair shot at attaining quality education, a good job, and a decent standard of living, they are able to buy more goods and services, pay more in taxes, and otherwise contribute to the growth of a healthy business ecosystem and regional economy. A broad and diverse workforce also contributes to innovation, stimulates the creation of new businesses, and spawns other types of dynamic economic activity that make places prosperous and resilient.

What Recovery Requires

The question now in front of state policymakers is how to create the conditions for an economic recovery that benefits everyone and ensures that all workers have opportunities to contribute to a more resilient and more prosperous future.

Experience and evidence tell us it will take concerted effort to help people, places, and systems in the following ways:

1. Help people rebound and advance by equipping all workers and learners with the knowledge, tools, and experiences needed for career entry and advancement.
2. Revitalize regional economies by investing in quality jobs and broadening access to them, co-designing talent development solutions with employers to address pressing skill demands and business growth opportunities, and empowering the community to play a role in charting a course for economic development.
3. Redesign education and workforce development systems by scaling and sustaining what works, spurring innovation, dismantling inequitable and arcane structures, and fostering collective action across systems in order better serve the skill needs of all workers, learners, businesses, and regional economies.

Only through bold action across these three pillars—people, places, and systems—can state policymakers succeed in driving sustainable economic growth for all. States must invest in their human capital in order to meet the skill demands of critical industries, generate new jobs, and revitalize our nation’s most distressed communities, including urban and rural areas that have been hit the hardest by the COVID-19 pandemic and the economic turmoil it has caused. This requires a more efficient, effective, and equitable pipeline for developing talent. This is something that cannot be achieved through existing systems of education and workforce development, or through new models, unless major reforms are made to policies, practices, and funding streams that have their roots in an America and an economy that existed a half-century ago.

If state policymakers fail to lead intentionally with equity as a guiding principle, history is bound to repeat itself. The country’s recovery from the Great Recession deepened the existing divides that are becoming even more evident today; it was marked by widening wealth gaps, rising debt, and a proliferation of low-wage jobs that offered little in the way of job security, benefits, or opportunities for career advancement. Of nearly 200 metro areas that together are home to 80 percent of U.S. population, not one managed to grow its economy, raise standards of living, and reduce gaps by income, race, and place.

States can—and must—work toward a better tomorrow, one in which growth and equity can go hand in hand.

COVID-19’s Disproportionate Health and Economic Effects

People of color and those experiencing poverty are disproportionately dying or falling seriously ill as a result of contracting COVID-19. Compared with white people, they are more likely to lose their jobs, shutter their small businesses, remain unemployed for extended periods of time, and lack an opportunity to work remotely. Other people in these populations continue to work but are more likely to be toiling away on the front lines in high-risk, low-wage jobs. And regardless of whether they have jobs right now or not, they’re facing major barriers to advancement in a rapidly changing economy. The pandemic has served as an “automation-forcing event,” marked by permanent destruction of millions of jobs and ever decreasing half-lives for skills.

Meanwhile, housing, food, and economic insecurities are on the rise, especially among low-income populations and people of color, aggravated by a persistent and acute lack of access to affordable high-quality health care, child care, and broadband internet service. After being thrust into remote learning environments, they and their children are disconnecting from education at alarming rates. These developments, combined with the growing civil unrest sparked by police brutality, leave the country with multiple crises rippling through low-income neighborhoods—raising the likelihood of a generational loss of economic security and opportunity.

Key Recommendations

JFF offers a range of state policy solutions designed to close equity gaps and drive economic advancement for all. Across our three policy pillars—which focus on people, places, and systems—we make policy recommendations to generate economic growth in a sustainable and equitable manner; to better connect learning with work to repair the nation’s talent pipeline, accelerate entry into the labor force, and bolster career pathways; and to leverage public and private resources in ways that drive upward economic mobility for people and improve the quality and resilience of their communities.

Using the Road Map

The Road Map provides states with opportunities to chart a path from where they are to where they want to be. For each of the 11 strategies featured in the Road Map, JFF gives a primer that explains why the issue area is critical to an equitable recovery and discusses challenges and barriers that could inhibit efforts to pursue a particular strategy. We present policy recommendations that provide tangible steps that policymakers can take and that meet states where they are. Recommendations are categorized across a continuum of “Foundational,” “Advanced,” and “Transformational” steps. Finally, to demonstrate that progress is in fact possible, we highlight states and local or regional authorities that are taking exemplary action. Each strategy section concludes with a list of JFF resources to guide further and deeper examination of the issues at hand.

JFF invites you to begin your use of the Road Map by clicking on each of the Pillar “Learn more” listed in the Recommendations section, above.