Despite federal funding cuts that spurred a 10 percent reduction in its workforce, Pikes Peak Workforce Center officials say that consumers will see no changes in the quantity or quality of service.

“It is not going to affect any of the services or any of the outreach that we do in the community,” said Traci Marques, the center’s CEO and executive director. “It’s business as normal.

“The customer-facing dollars are still the same,” Marques added. “We are going to continue to do what we do.”

Workforce Center officials announced in June that it had laid off five staffers after losing 9.2 percent of its federal funding, effective July 1, in order to preserve more funding for programs serving job seekers and employers with training and support services, said Becca Tonn, the center’s communications manager.

Job centers across the nation are grappling with funding cuts from the U.S. Department of Labor based on formulas that follow unemployment rates.

PPWFC is entirely funded by grants — 80 percent of them federal, with the state accounting for the remaining 20 percent, Marques said.

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After the Colorado Department of Labor and Employment implemented its own formula of allocations to the various workforce centers throughout the state, the Pikes Peak Workforce Center was looking at a 9.2 percent overall funding cut for the next fiscal year, Tonn said.

This year’s cuts came on top of an approximately 10 percent hit to the center’s funding in 2018, leading to the difficult decision to cut those staffing positions, Marques said.

“[Last year] we really tightened what we were spending and our allocations, and we really were able to not have to do a reduction in force last year with everything we had put in place the previous year,” she said. “But this year, with an additional 9.2 percent, we had no choice.”

The affected employees were offered severance packages and will receive 45 days of individual employment coaching, Tonn said.

“We realize that we are seen in the community as a go-to. When companies lay off their workers, if it’s over 50 people, then by law, they come to us for services,” Marques said. “We knew we really had to present this, both to our employees and to the public, that this is the way it should be handled.

“This is a family environment,” Marques added. “It was difficult decisions that had to be made, but you look at what’s best for the organization and for the community.”

PLANNING AHEAD

The federal budget cuts did not catch PPWFC officials off guard, Marques said. Staffers have been planning to offset that potential decrease since Marques took over as executive director 18 months ago, she said.

“It has been a strategy of mine to plan for five, 10 years out,” she said. “[The federal funding decrease] has always been part of the plan.”

Last calendar year, the center left vacant six high-salaried staff positions through attrition in order to lessen the anticipated impact of impending budget cuts, Marques said.

Marques called those vacancies “significant positions,” including a deputy director and a grants and development officer.

“Those were some big positions that we knew that strategically, going forward, those were going to be higher salaried positions,” Marques said. “We wanted to make sure we had the staff that truly does the work, to have them available to job seekers and businesses.

“When we look at this, we want to make sure what we’re providing to the community maintains the same,” Marques said. “Then we work backwards from there.”

The U.S. Bureau of Labor and Statistics reported a 3.9 percent unemployment rate for the Colorado Springs metro area in April, up nearly a full percentage point from a post-peak low of 3 percent in February 2017.

The Springs’ unemployment rate peaked at 9.5 percent in August 2010, according to the Bureau of Labor and Statistics.

While the national unemployment rate inched upward to 3.7 percent in June, it remains near a half-century low, the Washington Post reported July 5.

The rate increased because more Americans entered the labor force, meaning they found a job or are actively searching for one again, the Post reported.

PPWFC has seen its federal funding steadily decline over the years in relation to those federal numbers, Marques said.

“We know that because our allocations are based on unemployment, when [unemployment] starts to go up, our funding will start to increase,” she said.

“Now is a great time to look at and revitalize what we’re doing to become more efficient and effective in our processes and procedures.”

LOBBYING FOR CHANGE

Even when an area’s unemployment rates drop, that does not necessarily provide a full and accurate snapshot of its economic environment, Marques said.

She, and other members of various organizations associated with workforce development, have been advocating for changes in the federal and state governments’  funding allocation formula — “something that involves the economic scenery of the region,” Marques said.

“What new businesses, what training programs we have, what the poverty rate is — there are a lot of other different formulas to be able to provide true allocation,” she said.

Some people simply “check themselves out” of the workforce when unemployment rates are low, Tonn said. And those who have been unemployed on a long-term basis have dropped out of the search pool and are no longer being counted for statistical purposes, Marques said.

Although more people are currently employed, the ones who do seek out the workforce center’s services take more time because “they are that hard-to-serve population,” Tonn said.

That “hard-to-serve population” — “those with barriers to employment, those who are justice system-involved, those who are high school dropouts,” Marques said — are the main focus of PPWFC’s mission, and they often need more specialized attention.

“When the unemployment rate is low, you think you have fewer people to work with because most of them are working,” Marques said. “But to serve that population, sometimes it takes more people time to really surround them with the resources and give them the coaching they need to start a career.”