How Can Federal Funding Support Systems Alignment for Career Pathways?

In late 2022, the U.S. Department of Education (ED) announced the launch of Raise the Bar: Unlocking Career Success, an interagency initiative to reimagine how America’s high schools prepare students to thrive in their future careers. Highlighting the urgency of the work, U.S. Secretary of Education Miguel Cardona noted that, “It’s time we bridge the divide between our K-12 systems and our college, career, and industry preparation programs, which leave too many students behind and perpetuate inequities in our most diverse, underserved, and rural communities.”

He’s right, of course: Young people need more affordable, accessible pathways to transition from high school and into training opportunities that lead reliably to good jobs and into stable, family-sustaining careers. But he’s hardly the first to say so. In 2012, a decade before the Biden-Administration launched Unlocking Career Success, a similar array of federal agencies collaborated to extol the benefits of “career pathways” in the lead up to the reauthorization of federal workforce legislation, now known as the Workforce Innovation & Opportunity Act (WIOA). Modeling a united vision for coordination, the U.S. Departments of Education, Labor, and Health & Human Services issued guidance in a Dear Colleague Letter encouraging state leaders to “to promote alignment among their public workforce, education and social and human services systems” to provide more supported, navigable routes into the labor market. (And before that, there was School to Work, and before that…) A decade on, it’s clear that achieving this alignment is easier said than done. While there has been some progress — the explosion of dual enrollment participation, for example — most has come from improvements within individual systems, rather than across them. Programmatic innovation has occurred; broad, lasting systems change has not. But why?

To truly “bridge the divide,” K-12 education, postsecondary education, the public workforce system, and human and social service systems must function like coordinated parts of a whole. In reality, however, these systems are distinct. While their missions, activities, and the populations they serve may overlap, they rarely see themselves as partners in a shared enterprise. In fact, in many ways, they exist in competition with one another — especially when it comes to public funding.

At the federal level, the U.S. Department of Education (ED) is the primary funder of K-12 education, funding dozens of formula and grant-based programs that flow to state education agencies and individual school districts. Colleges, too, receive some funding from ED (although much of it indirectly, through the federal financial aid system). The U.S. Department of Labor (DOL) funds several youth-serving education and training programs, including Youth Activities, Job Corps, and apprenticeship. And a variety of social services, like supports for foster youth as they transition to adulthood, come from the U.S. Department of Health & Human Services (HHS), too. Their budgets are set by Congress, which must make annual — and often controversial — decisions about how to allocate a finite pot of resources across these and dozens of other departments and agencies.

From a practical perspective, these budget siloes make some sense: Each department needs dedicated resources to carry out its mission. But they also serve to reinforce a sense that those missions are entirely distinct. At the state and local level, agencies’ siloes tend to mirror their federal counterparts and state and municipal budget processes serve to further reinforce the structure.

State agencies receive money from the federal government to fund programs and services that advance their priorities in education, workforce and economic development, and human welfare. Each federal department imposes distinct accountability requirements, reporting timelines, and disbursement processes on the funding they administer. Often, these bureaucratic requirements vary across different pots of money administered by a single department, too. Such requirements can make resource alignment difficult even within a given silo. Cooperating between siloes can be even more complicated.

Adding to the challenge is the fact that there are myriad funding streams dedicated to education and training scattered across the federal government, as Table 1 depicts below. Some of these are large, broad pools of funding; others are small and narrowly-focused. Some flow through states to local agencies; some flow to institutions; and still others go directly to students. This budget fragmentation can make it hard to understand the full landscape of related programs and opportunities, which can impede cooperation and alignment. And it can create disincentives to collaboration, too: If every agency has a program to address its own priorities, what is the incentive to work together towards a more systemic approach? As one local system leader told us last year, ‘’People are afraid to even bring up the question, “Could we use these funds for XYZ program?” People don’t want to draw attention to themselves. It's easiest to just comply in the simplest way possible.’’

According to a 2019 report from the Government Accountability Office (GAO), the U.S. had 43 unique employment and training programs funded by eight federal agencies, all designed to improve labor market outcomes for program participants. (In some cases, programs were general in nature; others targeted one or more populations that face specific barriers to employment, such as youth, veterans, or people with disabilities). Some degree of fragmentation is understandable. As the GAO report notes, it can be beneficial in, “1) helping program participants with specific needs better access [employment & training] services, 2) providing more tailored or intensive support services, or 3) achieving higher quality outcomes for specific populations than would be achievable from their use of a more broadly targeted program.” But, as they acknowledge elsewhere in the report, fragmentation “can also hinder people from seeking assistance and frustrate employers and program administrators” working at the state and local level.

In its approach to analyzing the pitfalls of budget fragmentation, the GAO inadvertently reveals the pervasiveness of federal siloes. Published seven years after the federal government urged alignment across our public workforce, education, and social and human services systems, the GAO’s review of ‘’employment and training programs’’ omitted the Every Student Succeeds Act, which provides critical resources to the institutions at the very beginning of young adults’ career pathways: high schools. None of the Higher Education Opportunity Act’s funding streams were included either, as if two- and four-year colleges play no role in the nation’s employment and training enterprise.

So long as we think of our education and workforce systems as separate — and siloed and fragmented funding infrastructure reinforces the division — it will be impossible to achieve the alignment Secretary Cardona and his predecessors have envisioned. More importantly, it will be impossible to deliver at scale the supported, seamless pathways that America’s young people need to transition into our rapidly changing labor market.

To truly “bridge the gap” between the systems that serve young people on their journey to adulthood, those systems must share a common vision and have the flexibility to align their work and resources toward it. Currently, at least at the federal level, these conditions do not exist.

Well, at least not universally.

Over the next several weeks, New America will be exploring three instances where legislation has extended special flexibilities to federal departments to promote greater resource alignment and deeper cooperation, and to ultimately provide for more efficient, effective, and equitable service delivery. This series will highlight the origins and mechanics of these cases and glean lessons from implementation. Ultimately, we hope the series can inform future policy experiments designed to address funding barriers to greater alignment between the nation’s youth-serving systems.

First up, in the first deep dive in this series, Lancy Downs writes about the Performance Partnership Pilots for Disconnected Youth (P3), an innovative federal experiment that provided state, local and tribal partnerships flexibility to combine discretionary funds from multiple Federal programs. Check back next week for the second deep dive!