Executive Summary

In 2001, surface transportation made up 8 percent of U.S. gross domestic product and about 18 percent of average U.S. household expenditures, second only to housing. The nation’s economy and the lifestyles of its citizens depend heavily on a safe and efficient transportation system. Yet, surface transportation agencies face unprecedented challenges in recruiting and retaining the workforce they need to deliver transportation infrastructure and service effectively. The responsible and efficient operation of the nation’s transportation system depends on a well-trained workforce. Successfully addressing transportation workforce issues requires a collective effort involving the agencies, the federal government, the private sector, and a wide range of academic institutions, as well as the transportation workforce.

WORKFORCE ISSUES EXAMINED IN THIS STUDY

State departments of transportation and transit agencies deliver transportation infrastructure and service with the support of a host of private-sector contractors and consultants. The Committee on Future Surface Transportation Agency Human Resource Needs was convened by the Transportation Research Board to determine how these agencies can reorient their human resource efforts over the next two decades in order to respond to future changes in roles and responsibilities within their organizations. The intent of this study was not to precisely measure shortfalls between labor force supply and demand. Rather, the committee examined what is needed for transportation agencies to strategically alter key human resource activities—recruiting, training, retaining, and succession management—and makes recommendations designed to enable these agencies to continue to meet



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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies Executive Summary In 2001, surface transportation made up 8 percent of U.S. gross domestic product and about 18 percent of average U.S. household expenditures, second only to housing. The nation’s economy and the lifestyles of its citizens depend heavily on a safe and efficient transportation system. Yet, surface transportation agencies face unprecedented challenges in recruiting and retaining the workforce they need to deliver transportation infrastructure and service effectively. The responsible and efficient operation of the nation’s transportation system depends on a well-trained workforce. Successfully addressing transportation workforce issues requires a collective effort involving the agencies, the federal government, the private sector, and a wide range of academic institutions, as well as the transportation workforce. WORKFORCE ISSUES EXAMINED IN THIS STUDY State departments of transportation and transit agencies deliver transportation infrastructure and service with the support of a host of private-sector contractors and consultants. The Committee on Future Surface Transportation Agency Human Resource Needs was convened by the Transportation Research Board to determine how these agencies can reorient their human resource efforts over the next two decades in order to respond to future changes in roles and responsibilities within their organizations. The intent of this study was not to precisely measure shortfalls between labor force supply and demand. Rather, the committee examined what is needed for transportation agencies to strategically alter key human resource activities—recruiting, training, retaining, and succession management—and makes recommendations designed to enable these agencies to continue to meet

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies workforce challenges and adjust to labor market realities. Also addressed is the important leadership role of the federal government in this effort. Transportation workforce issues are complex. There are more than 50 state departments of transportation, nearly 6,000 transit agencies, and many other public agencies with transportation responsibilities. Each has its own set of responsibilities, organizational structure, history, and culture. Each must adapt to internal and external social, political, and institutional working environments, often in different ways. Agencies vary widely, and although each has its own unique capabilities and resources to address workforce needs, all have limited resources. Few have addressed their future workforce needs in a comprehensive fashion, which further complicates efforts to predict how many people in specific job categories for each type of agency will be needed in 5 or 10 years. The committee did not attempt to estimate specific agency needs—what kinds of workers are needed for what kinds of jobs—in any detail because the basis for any such estimate is insufficient. Most agencies do not have mechanisms in place for identifying the skill sets they need. Each agency must decide what skills it needs and set out to obtain them. It is evident that in recruiting, training, and retaining employees in transportation agencies, one size does not fit all. Agencies must adopt and adapt practices that are best suited to their individual circumstances from a wide range of possible alternatives. This is a complex endeavor because in addition to competing with each other, transportation agencies compete with the private sector for qualified staff. With these constraints in mind, the committee focused on how agencies can meet their workforce needs, now and in the future, regardless of specific or cumulative need. To their credit, all the agencies—in both the public and the private sector—have a long history of working together successfully to address common problems in a systematic and coordinated fashion. The Interstate highway system is an example of such successful collaboration. In the course of this study, it became clear to the committee that many factors require immediate action and that the situation may, in fact, be far worse than anticipated. Among the factors are high levels

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies of anticipated retirements; insufficient numbers of midlevel managers available to fill forthcoming vacancies; the need for new workforce skills required to keep pace with new methods and advanced technologies, including systems analysis, computer-aided design and engineering, new materials, robotics, and intelligent transportation technologies; and increasing demands on surface transportation agencies. The needs are critical. The committee makes recommendations that can be implemented to avoid the severe consequences of inaction that are quickly approaching or already affecting the nation’s transportation and transit agencies. Consider the following: Expanded agency missions require new skills. Today’s state departments of transportation were established as highway agencies in the last century to build road networks. Now some of them are responsible for airports, railroads, public transportation, ports and waterways, intermodal operations, and other ancillary functions (such as motor vehicle registration and enforcement) as well as highways. Their changing mission and broader responsibilities require a workforce capable of addressing many issues other than engineering. Transit agencies offer many types of service and must address numerous community, economic, and customer issues. All agencies face planning, environmental, and technology issues and are increasing their use of telecommunications, data management, and other information technologies. Thus, agencies require a workforce with a wider range of technical disciplines than ever before. Program growth coincides with level or decreasing staffing. Although programs are expanding, budget restrictions frequently call for maintaining or reducing current staff, resulting in more contracting out and a need for additional contract management and administration skills. Senior agency staff are likely to retire in unprecedented numbers. More than 50 percent of the state transportation agency workforce will be eligible to retire in the next 10 years. While this trend is not unique to transportation agencies, it is more than double the rate for the nation’s entire workforce.

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies Increasing difficulties in recruiting and retaining professionals and technicians are common. Today’s highly competitive job market shows a growing disparity between pay scales in the public and private sectors. Transit agencies, whose bus and train operators make up about 75 percent of the transit workforce, are struggling to attract workers to this rule-bound, seniority-based environment. Transit agencies’ inability to offer work schedule flexibility, which is highly regarded by today’s job applicants and common in other industries competing to attract these same employees, adds a unique constraint on recruiting. In addition, transit agencies typically offer less pay and fewer opportunities for advancement than do state departments of transportation. Therefore, they frequently find it more difficult to recruit many of the same types of professionals— engineers, planners, and environmental and financial specialists— than do the departments of transportation. Workforce training expenditures are insufficient. Benchmark studies of training investment in the private sector and federal agencies indicate that successful organizations spend, on the average, 2 percent of salaries on training, at least four times more than transportation agencies. Meeting an organization’s strategic plan requires positioning human resource activities at the strategic level. Agencies whose human resource function focuses solely on filling positions to meet immediate needs cannot achieve their strategic goals of recruiting successfully in today’s job market. Although any one of these issues would be of concern individually, in combination they suggest an impending crisis, which—with foresight and intervention—may be averted. They also reveal the key role the federal government has in meeting the challenges of the transportation workforce. Because it has the responsibility for strategic national interests, the federal government—Congress, the administration, and the U.S. Department of Transportation (USDOT) and its modal administrations—has a large stake in the effectiveness of the nation’s transportation workforce. The federal government relies on the national transportation workforce to deliver the programs and

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies projects the nation needs to accomplish its economic, mobility, safety, environmental, and defense mobilization goals for transportation. As the primary steward of the nation’s transportation system, the federal government is in the best position—in terms of resources, scope of interest, and influence—to take a leadership role in addressing transportation workforce issues. Absent federal leadership, attempts to resolve these human resource issues will lack strategic direction and national scope, despite the best efforts and accomplishments of individual transportation agencies and their national associations. RECOMMENDATIONS The committee’s recommendations are aimed at a broad range of agency needs and apply to surface transportation agencies but recognize that others—the federal government, the private sector, educational institutions, unions, and employees—must be involved in addressing the key issues. The opportunity to partner is great, as is the potential for collaboration and cooperation on many fronts. Partnering may be difficult at times because of rules and regulations that require distance between public- and private-sector activities, but examples from many successful partnerships and collaborations in other industries suggest that barriers can be overcome. A summary of the committee’s recommendations and its views on the potential consequences of inaction follow. Training must be a key priority for all involved. Surface transportation agencies at all levels—federal, state, and local—in partnership with the federal government, the private sector, educational institutions, unions, and employees, should establish training as a key priority. Training must be viewed as an investment providing needed knowledge, skills, and abilities. It can be a key component of alternative pathways to transportation agency careers by providing those from undergraduate programs (including community college programs) in business, planning, environmental science, public policy, and other areas with access to the transportation workforce. Commitment to

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies training is measured by the amount of training and the effectiveness of the training. The agencies must invest more in training than they are now. An investment goal of 2 percent of salaries for training—as suggested from benchmarking surveys of many successful organizations—is appropriate for transportation agencies. This is equivalent to about 40 hours of training annually for each employee. While this benchmark goal is important, the training must be effective as measured in terms of improved performance, lower costs, and other metrics. Consequences of inaction: Lack of adequate training can lead to ineffective agency operations, inefficient use of limited resources, and higher future costs to meet future needs. More federal surface transportation program funds should be eligible for use by state and local transportation agencies for education and training activities. The committee believes that while spending at all levels for training and education of the transportation workforce should be increased, federal spending can serve as an important catalyst. Federal reliance on the nation’s transportation workforce supports the need for federal leadership in addressing transportation workforce training. Current federal funding for transportation workforce training has several components. The largest single source of federal training funding to agencies is a discretionary program that permits states to use up to 0.5 percent of a portion of the funds from the Surface Transportation Program—about $38 million—for education and training. Similarly, transit agencies can use a portion of their federal operating and capital investment funds—about $32 million—for training. The committee supports the administration reauthorization proposal that calls for making more existing program funds eligible for education and training. By adding several existing programs to those programs whose funds are eligible for education and training expenditures, the administration’s proposal, if enacted, would yield a 200 percent increase in available discretionary funds. Each agency could then decide how much of these funds it wishes to invest in education and training across a number of eligible programs. Many federal transportation programs—which amount to about $36 billion annually—encourage the use of new methods and ad-

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies vanced technologies, including planning and environmental models, systems analysis, intelligent transportation systems technologies, community involvement, and alternative fuel transit vehicles. However, these programs do not support training for agency staff responsible for implementing, operating, and maintaining these new methods and technologies. This lack of support acts as a barrier to wider implementation of transportation system innovations that can improve safety and performance and reduce costs. It also hampers the federal stewardship role aimed at ensuring that state and local governments use national resources efficiently. The committee also supports reauthorization proposals to increase funding for existing federal programs that directly support education and training, including the University Transportation Centers (UTC) program, the Federal Highway Administration’s National Highway Institute, the Federal Transit Administration’s National Transit Institute, and the Local Technical Assistance Program (LTAP). In conjunction with increasing the federal program funds available for agency education and training, Congress should also introduce incentives that trigger more federal funding if states and agencies invest their own funds in education and training for the transportation workforce. Incentives should be added to the UTC program to encourage the UTCs to partner with community colleges to provide specific education and training in areas for which the community colleges are best suited. Increased training investment must be accompanied by systematic evaluation of training outcomes. Consequences of inaction: Failure to increase federal spending for training will limit the ability of all agencies to provide education and training needed to decrease project delivery times, improve service, reduce system operational problems and failures and their consequences, and use new technologies. USDOT, in partnership with transportation agencies, the private sector, educational institutions, unions, and employees, should undertake an initiative that focuses on innovation in human resource practices and addresses recruitment, training, retention, and succession management for transportation agency

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies personnel. This initiative can provide leadership; a focal point for federal, state, and local agency efforts; and a basis for creating partnerships among all key parties. The federal government, because of its national transportation responsibilities and the resources within the human resource organizations in USDOT and its modal agencies, is in an excellent position to lead this initiative as a follow-up to the USDOT-sponsored 2002 National Transportation Workforce Summit. USDOT can interact directly with other federal agencies that are moving forward on workforce development initiatives and acquire useful information and data from them. The transportation workforce initiative can build on current efforts, including the Transportation Workforce Development website being developed by the Federal Highway Administration in partnership with the American Association of State Highway and Transportation Officials to document exemplary workforce practices at state departments of transportation. Another example of current work that would be useful to incorporate is that of the American Public Transportation Association’s Workforce Development Task Force. Broadening these efforts to include experiences from all types of transportation agencies and private-sector organizations would provide much-needed information and support. All stakeholders in the nation’s workforce—agencies, academia, trainers, unions, employees, and the private sector—should participate in setting priorities and direction for the initiative. These partners should work together to compile information to examine the national implications of transportation workforce issues. Consequences of inaction: Without federal leadership in an initiative aimed at innovation in human resource practices, a significant opportunity to improve transportation workforce practice and share information and data will be lost. Transportation agencies should partner with universities, community colleges, training institutes, and the LTAP centers to meet agency training and workforce development needs. These institutions are well organized to provide education and training and have the technical expertise to deliver the curricula, courses,

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The Workforce Challenge: Recruiting, Training, and Retaining Qualified Workers for Transportation and Transit agencies and training materials required to meet agency skill needs. Many have already done so. More needs to be learned about the appropriate role of each, individually and in combination, in delivering efficient and effective education and training to the workforce. Consequences of inaction: Failure to partner with established education and training providers prevents agencies from taking full advantage of key workforce development opportunities. Transportation agency leaders must make human resource management a strategic function in their agencies. The most successful private- and public-sector organizations have raised human resource management to the strategic level in their organizations because they recognize that human capital is a key to successful performance. Several transportation agencies have already carried out organizational changes to make the human resource function a strategic and equal partner with other key agency functions. Without this organizational change, agencies will continue to fill positions in a piecemeal fashion instead of identifying future workforce needs and addressing gaps in their ability to meet those needs through a strategic human resource program. Consequences of inaction: Failure to change agency human resource focus from solely filling vacant positions to strategically addressing workforce needs will result in agencies falling short of accomplishing their missions, especially in light of today’s competitive job market. All these recommendations aim at improving the performance of transportation agencies and, ultimately, the nation’s transportation system. They reflect the goals and benchmarks of successful public-and private-sector organizations. They also reflect the primary goal— improving human capital—of President Bush’s 2002 Management Agenda.

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