Local Hiring Hits the Road

Local Hiring Hits the Road In the last few months, local hiring has rapidly gained traction as an anti-poverty tool utilized at the local, state, and now federal level. As cities across the country have rapidly moved to enact new local hiring policies to target disadvantaged communities with high unemployment, the federal government has now taken unprecedented action to implement local hiring pilots on federally funded projects. Analyzing these exciting new pilots encouraged by the U.S. Department of Transportation (USDOT), Brightline has recently published its September 2015 report, Local Hiring Hits the Road. With support from the Surdna Foundation, public policy nonprofit Brightline has been able to analyze these new trends and provide technical assistance in strengthening workforce development systems for cities across the United States.

Additionally, as local hire ordinances reduce unemployment and increase diversity throughout industries, more and more cities are jumping on the bandwagon. Especially in so-called "right to work" states, the labor movement has embraced local hire as a way to create better jobs and improve quality of life in local communities. In August 2015, Nashville voters passed Amendment 3, a charter amendment that establishes a 40% local hire requirement on publicly funded construction projects. In early September, the New Orleans City Council, along with community activists, nonprofits, and business leaders, pushed for an ordinance backed by Mayor Mitch Landrieu that would take language directly from San Francisco's local hiring policy around building up specific percentage requirements for local hire and disadvantaged workers for publicly funded or tax abated projects.

Seeking to dismantle these community-labor partnerships, conservative forces continue to set up roadblocks against local hiring reform. For instance, Ohio's state legislature has passed a bill that would prohibit cities from enacting local hire requirements. Yet such actions ignore the basic legal principle that municipalities in "home rule" states such as Ohio and Tennessee are bound by their city charter rather than state law in matters of local self-government.

Fortunately, decisive legal victories have been won for greater community reinvestment and good-paying jobs for local, unemployed communities throughout 2015. In August, a recent New Jersey judicial decision rejected at least four constitutional challenges and confirmed that municipalities can attach project labor agreements and local hire requirements to tax abatements. In other words, opponents have found their legal arguments backfiring spectacularly as cities move to strengthen their local economies by linking economic development and better workforce practices.  
Brightline has ramped up its efforts in Newark to restore Newark's local hiring efforts to higher levels unseen since the days of Gus Heningburg's efforts at Newark Airport forty years ago. Right now, the city has a staggering 19.5% unemployment rate-nearly twice that of New Jersey as a whole-and only 18.2% of the people who work in Newark are local residents. Meanwhile, Newark is in the middle of a construction boom, with $1.5 billion worth of construction since 2010 and more development projects in the works. If it attaches a 50% local hire requirement to future tax-abated projects, Newark could expect to see 4,800 direct construction jobs going to local residents for every $1 billion spent on construction.  Of course, local hiring has additional implications for indirect supporting jobs, and if applied successfully, this tool would have additional implications for other industry sectors ranging from manufacturing to tech.

"Local hire provides a pathway to economic self-sufficiency for Newark residents," said Brightline's legal fellow Dilini Lankachandra, who has undertaken extensive legal analysis of federal constitutional law that validates attaching workforce requirements to tax-abated projects, "it strengthens local communities by spreading the benefits of city-funded redevelopment to those who need it the most, creating well-paying and dignified jobs for often overlooked populations."


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