In summary
Gov Gavin Newsom made job training and the creation of a master plan for career education part of his agenda. Now, key workforce initiatives may get no new funding.
Standing in a West Sacramento high school cafeteria in 2023, Gov. Gavin Newsom promised fundamental reforms to the state’s job training programs. A few months later, he was in front of a fire truck in Modesto, and later, in a welding classroom in Redding, making the same promise.
It was a “point of pride,” Newsom said last year.
Now, a handful of those reforms are underway. A new inter-agency council, designed to increase collaboration among workforce providers, is meeting next week. The state is also developing a new kind of digital resume that would help students and workers consolidate information about their work experience and education.
But as the state faces yet another budget deficit, a flagship workforce program could be forced to scale back. One of the state’s leading agencies for coordinating workforce training, the California Workforce Development Board, could lose 20% of its staff.
In the governor’s budget proposal for 2026-27 fiscal year, several workforce programs, including the governor’s “high road training partnerships,” would receive little or no new funding, meaning that they could shut down by the time the next governor assumes office or soon thereafter. The Legislature has already passed a budget that largely accepts Newsom’s proposals, and the governor has until the end of the month to approve it.
Some job training organizations criticized the governor’s proposal to withhold new funding this year.
“At a time when affordability is such a massive concern, it feels like we’re focusing on what things cost and not enough on what people can earn,” said Julia Hatton, the president of the Rising Sun Center for Opportunity, told CalMatters. Her organization trains workers for jobs in construction and climate-related careers and has received nearly $4 million in state workforce grants.
However, in a legislative hearing in April, Allison Hewitt, a budget analyst with California’s Department of Finance said the state is still committed to workforce development and that the board’s budget isn’t being cut, just that it isn’t receiving new funding. The workforce development board received a “surge” of grants over the past few years, and those dollars have been spent so less funding is available this year, she said.
That did not sit well with at least one legislator.
“I mean, you can say that all you want,” said Sen. María Elena Durazo, a Los Angeles Democrat, in response. “But if we’re not proposing funding for that … then you’re basically saying this is gonna be the new policy. The bottom line is without funding, it’s not a reality.”
In an emailed statement to CalMatters, Marissa Saldivar, a spokesperson for the governor, said Newsom’s workforce plan focuses on “structural changes to benefit students, which does not always require funding.”
H.D. Palmer, a spokesperson for California’s Department of Finance, responded in the same email, saying that the current budget proposes over $250 million in new workforce funds, including in healthcare and construction.
By comparison, the state put over $2.2 billion into new workforce grants in the 2022-23 budget year.
Have workforce programs succeeded?
For decades, states and the federal government have pumped money into job training programs, especially for low-income workers without college degrees, but the results are often poor. Graduates end up earning minimum-wage or landing in jobs with low retention, where many workers quit within the first year.
To improve outcomes, California created the high road training partnerships to target job training programs that yield long-lasting, living-wage employment where the employer, not just the government, has a stake in the worker’s professional growth. Starting around 2014, the state put a small amount of money into these programs, said Stewart Knox, the secretary of California’s Labor and Workforce Development Agency.
In 2021 and 2022, the state made “massive investments in the workforce,” he said, pumping hundreds of millions into high-road programs all across the state, including in construction, healthcare, technology and in public sector jobs. The state sent money to current and former oil workers to help them retrain for careers when refineries close. It also sent money to youth apprenticeship programs.
Results have been mixed. In the high-road program, some grants helped train hundreds or thousands of workers for union jobs while other grants created few concrete benefits for workers. One grant was supposed to train workers at the electric vehicle company Proterra, but the company closed before workers could begin.
This year, Assemblymember Rick Chavez Zbur, a Los Angeles Democrat, is proposing a bill to further restrict how the high-road money is used.
Out of the roughly 1,700 oil workers who could benefit from the state’s retraining grants, only about 500 participated as of May, according to a bill analysis. That bill, authored by San Rafael Assemblymember Damon Connolly, a Democrat, would give grantees more time to spend the money.
A ‘master plan’ for career education
In 2023, Newsom’s workforce plans culminated with an executive order calling for the creation of a master plan for career education that would create a “new foundation” for the state. The plan, released in 2025, called for better coordination among the state’s workforce providers, who often compete for the same students. The master plan also called for more high-road job training programs and highlighted ongoing work supporting youth apprentices.
“We’re definitely not done. We’re kind of mid-stage,” said Knox. “What you’re seeing is a little less money, yes, in terms of programs, but that’s because we did such massive investments from 2021 on into the system (and) those outcomes now are what we’re focused on.”
Knox pointed to outcomes from the master plan, including the growth of dual enrollment, which allows high school students to take college classes. The state is also helping thousands more students get college credit for their prior work experience, he said.
Palmer, with the state’s Department of Finance, said in an email that the current proposal from the Legislature includes more funding both for dual enrollment and to help college students get credit for their work experience. Those funding allocations, however, come from a different pot of money, known as Proposition 98, which is largely restricted to education.
The Shirley Ware Education Center, a national job training nonprofit founded in Oakland, was among the earliest and largest recipients of the high-road training grants, which it used to help over 5,500 workers find better jobs, mostly in the healthcare industry. All told, the organization received more than $40 million in state workforce dollars starting in 2017.
“When the state was flush with cash, they put a lot of money into these programs,” said Rebecca Hanson, the executive director. Now, she said the state budget deficit makes it “hard to argue” for increased funding, especially when so many other core services are facing cuts.
Hanson’s high-road workforce grant ends in 2027, but even then, she said she isn’t too worried, since her organization has other funding and is used to these fluctuations in state support. “My hope is that by the time we’re talking about 2028, we’ll be able to find other money.”
