Winners and Losers on AI

The Brookings Institution benchmarks 387 U.S. metro areas on their AI economic readiness. Also, a project to help 12 states gauge the value of short-term credentials, reporting on who might benefit from Detroit’s tech boom, and an essay on abundance thinking for higher ed. (Was this newsletter forwarded to you? Subscribe here.)

Mapping the AI Economy

As concern mounts over which job roles have the most exposure to artificial intelligence, new research shows which local economies are positioned to harness the technology.

The report from Brookings Metro examines how AI’s creation and application are unfolding across 387 U.S. metropolitan areas. By benchmarking across 14 indicators—organized around talent production, innovation, and industry adoption—the researchers group those metro areas into six tiers of AI economic readiness.

Not surprisingly, San Francisco and San José top the list and are in a “superstar” category no other city matches. They were followed by 28 “star hub” cities—ranging from New York to Gainesville, Florida—that come close to the Bay Area on AI adoption and talent while being weaker but still strong on innovation. 

The superstar and star hub cities together account for fully two-thirds of the nation’s total AI-related job postings this year.

However, the researchers also see real promise in the next two categories, as Elyse Ashburn reports for Work Shift. Those “emerging centers” and “focused movers” respectively have strengths in two areas or are real standouts in one.

Pittsburgh, for example, is tagged as one of 14 emerging centers. At an event there this week, Google pledged to invest $25B in data center and AI infrastructure across a multistate electricity market anchored around Pennsylvania. The company also launched a project to provide essential AI skills training to workers and students, beginning in the Keystone State.

Blackstone, the private equity giant, this week announced that it will invest more than $25B to support the buildout of Pennsylvania’s digital and energy infrastructure. President Trump also spoke at the event in Pittsburgh and praised investments in AI and fossil-fuel energy production. 

FOMO: The Brookings report’s authors say they worry most about regions that don’t really have AI on their radar. They might avoid the short-term disruption that’s likely to hit cities with large numbers of highly exposed white-collar jobs but also risk missing any upside.

“A place should not think that the absence of AI is necessarily a relief, and some may,” says Mark Muro, a senior fellow at Brookings, who co-authored the report with Shriya Methkupally, a senior research assistant. “They should be worried about falling further behind.”

The report is part wake-up call and part rough draft for regional plans. And the clock is ticking.

“We don’t have a whole lot of time given how difficult it is to reorient systems, to get state and local policies into position, and to effect change,” Muro says.

Read the full article on Work Shift.

Sharing Success in the Motor City

Detroit joins Pittsburgh as one of four cities the Brookings report says lead the group of emerging centers on AI, along with Nashville, Tennessee, and Tampa, Florida. The Motor City is growing local talent and seeing increased investment in AI and cutting-edge tech more broadly.

A multipart series of articles by Detroit-based reporter Ethan Bakuli will explore Detroit’s tech ecosystem. Bakuli’s reporting is focused on the successes and challenges of efforts to train Detroiters and help them break into tech-related fields. 

The city has grown into one of the world’s fastest-growing startup ecosystems, Bakuli writes in the first article of the series, which Work Shift published. Annual venture capital investments hit $467M across the metro area in 2023, while the Ford Motor Company has spent roughly $1B to develop an innovation hub and an incubator for tech startups.

However, it’s unclear how much the city’s tech boom will benefit longtime residents.

“Even as downtown Detroit welcomes thousands of new workers and dozens of new infrastructure projects,” writes Bakuli, “systemic barriers to middle-wage jobs for longtime Black residents threaten to stymie the city’s ambitious goals to become its version of Silicon Valley.”

Read the full article on Work Shift.

Future-Ready States

A new project backed by the Lumina Foundation seeks to help 12 states better gauge the value of short-term credentials, with a plan to create a set of principles that could be used by other states and the federal government. 

With an initial investment of roughly $2.2M from Lumina and an 18-month timeline, the FutureReady States initiative will support five intermediary organizations in offering states a mix of technical assistance and policy guidance.

Participating states are a mix of red and blue, including Alabama, Colorado, Connecticut, Illinois, Louisiana, Michigan, Mississippi, New Jersey, North Carolina, Tennessee, Texas, and Virginia. The partner groups are the Business–Higher Education Forum, the Century Foundation, Education Strategy Group, Jobs for the Future, and the National Skills Coalition.

State funding for workforce credential programs has increased rapidly, with 31 states investing at least $5.6B in them last year, according to an analysis from HCM. But a firm grasp of the ROI of these credentials remains elusive, as are answers to questions about how well matched they are to the needs of employers.

“We haven’t invested as much in learning about the strengths and weaknesses of short-term workforce programs,” says Kermit Kaleba, Lumina’s strategy director for employer-aligned programs. “There are limitations on our understanding of which credentials lead to good labor market returns.”

Employer engagement and participation will be a key focus of the work. And Kaleba says the foundation is reviewing research proposals on barriers employers face in more effectively using short-term credentials in hiring and promotion.

The project will not prescribe a particular approach, say Lumina and reps from the five intermediary groups. That flexibility means it’s unclear what takeaways might emerge. And making progress on the data front won’t be easy.

Questions to Explore: The state-level strategy is encouraging, says Maria Cormier, a senior research associate at the Community College Research Center at Columbia University’s Teachers College. And she says the project could help tackle several urgent questions beyond vexing ones on data.

For example, states bring a variety of approaches to how they fund short-term credentials, Cormier notes. Some, like Virginia and Colorado, provide direct aid to students. Texas and North Carolina incentivize community colleges to offer short-term credentials in high-demand fields. Other states, however, encourage colleges to create those programs without providing any new dedicated funding.

“What type of financial incentive from the state generates better value?” asks Cormier, adding that the initiative could create “opportunities to compare apples and oranges.”

Questions about implementation and scaling also are pressing, she says. So are a myriad of tough trade-offs states and colleges must make to offer more workforce credentials. For example, is a welding program that enrolls five students worth keeping amid moves by some states to force colleges to cut low-enrolled programs, even if employers are calling for that training?

“What’s of value to the institution? What’s of value to the student?” asks Cormier. “Who gets to determine what’s valuable? Is it just the labor market and employment outcomes?”

State policymakers have been clamoring for those answers. And experts say the Trump administration’s cuts to federal education research contracts aren’t helping.

For example, Virginia’s G3 program is among the highest-profile and most established state strategies to subsidize workforce-aligned short-term training. Cormier was leading a partnership with the University of Pennsylvania and the Virginia Community College System to conduct a three-year study of G3’s role in expanding access to high-demand jobs. 

The research yielded a brief this month. But the Education Department’s deep slashing of research grants nixed the G3 study, one year before it could be completed with a full evaluation. (It’s not too late to resuscitate that work with philanthropic support.)

Cormier hopes the Lumina-funded project can help connect some dots on short-term education and training. The overarching goal, says Kaleba, is better investment of taxpayer dollars.

The Kicker: “We’re not maximizing the value of these credentials for workers, for businesses, and for the broader public,” he says. “We’ve got to do better.”

Open Tabs

CTE to Labor
The Trump administration has made official its plans to relocate much of the administration of career and technical education programs to the Labor Department. The planned integration of the federal education and workforce system was revealed last month in a court filing. The transfer covers WIOA and Perkins Act programs and will “give states central points of contact in the federal government,” the Education Department said.

Program Eligibility
The Education Department rescinded a Clinton-era letter in a move to prohibit undocumented immigrants from accessing federal funds to participate in CTE and adult education programs. “Postsecondary education programs funded by the federal government should benefit American citizens, not illegal aliens,” said Linda McMahon, the education secretary. The department noted that federal Pell Grants and loans remain inaccessible to undocumented immigrants.

Graduate Surplus
The share of working-age Americans without college degrees will be significantly smaller by 2034, as the rising generation of young adults is far more likely to hold a bachelor’s degree than the retiring cohorts they’re replacing, economists from the Burning Glass Institute write. This trend raises the risk of a graduate surplus, especially as AI dampens white-collar job growth. Meanwhile, demand for blue-collar and manual service workers remains strong.

Confidence in College
Americans’ confidence in higher education has increased, hitting 42% of respondents in a new Lumina-Gallup survey, up from 36% the past two years. The share with little or no confidence in higher ed declined to 23% from 32% a year ago. Increased confidence was seen among most societal subgroups, including those without a four-year degree (up six percentage points to 40%) and Republicans (up six points to 26%).

Misaligned System
School-to-work pathways for millions of young Americans—with and without college degrees—are far more deeply fractured than previously known, posing a significant threat to building the future workforce essential to growing the U.S. economy, notes the Schultz Family Foundation, which released research on this “broken marketplace.” The study found that most young Americans are concerned or unsure about job opportunities and the impacts of AI.

Youth Opportunity
As young Americans face growing uncertainty about AI’s impact on the job market and declining confidence in traditional career pathways, public-sector and philanthropic funding should invest in systems, not individual programs, according to a brief from the American Institutes for Research and the Brookings Institution. Based on interviews with state and local innovators, the brief says successful regions build collaborative ecosystems with cross-sector partnerships.

Job Moves
DeRionne Pollard has been named the next president and CEO of the American Association of Community Colleges. Pollard is currently president of Nevada State University and previously led Maryland’s Montgomery College. She is slated to this fall replace Walter Bumphus, who has led AACC since 2011.

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