The San Antonio City Council approved Ready to Work’s $49.5 million budget for fiscal year 2025 Thursday, the largest annual budget so far for the taxpayer-funded workforce development program approved by voters in 2020.
Next year’s budget includes $6 million to reimburse some local employers for the costs of on-the-job training for new employees and additional training or “upskilling” for existing workers.
The council approved a $3 million pilot version of the program in April, with 33 local employers committing to train or upskill almost 1,400 workers.
Council reactions to this addition to Ready to Work have run the gamut. Teri Castillo (D5) called it “corporate welfare,” with public money going to “billion-dollar industries.”
Mayoral candidate Manny Palaez (D8), who has called the on-the-job training component his “favorite part” of Ready to Work, on Thursday echoed others when he pointed out that the new program “has the full throated support of our labor unions and the chambers of commerce.”
Councilman Jalen McKee-Rodriguez (D2) wanted to make sure the money could be clawed back if companies don’t meet the program’s goals as laid out in their contracts with Ready to Work.
Mike Ramsey, executive director of the city’s Workforce Development Office, which administers Ready to Work, clarified that the contracts do not include a clawback provision “because these are reimbursement agreements; they only get reimbursed for holding up their end of the agreement.”
“Even better,” replied McKee-Rodriguez, who noted that the East Side has been one of the city’s regions most impacted by economic and racial segregation. “I will continue to watch this closely to ensure that my district is able to access any and every possible benefit of this program.”
District 2 residents have enrolled in training programs and been placed in jobs post-training through Ready to Work at the highest rate of any district, according to the Ready to Work dashboard.
Participants’ mean annual salary in their new jobs is $40,803. Just over 600 local employers have hired those who’ve completed job training through Ready to Work, including the City of San Antonio, University Health, VIA Metropolitan Transit, Accenture, Amazon and H-E-B.
Just over 7,000 residents are currently enrolled in training, according to the dashboard, and 963 have been placed into jobs. That low number remains the most persistent criticism of the program, along with the low percentage of those who have been placed in a job within 6 months.
The goal is for 80% of those who complete a training program to be hired within 6 months. Right now, the 6-month success rate is just 50%. Stretched to 12 months, the rate is 78%.
That’s part of the reason next year’s budget includes funding for seven additional city employees to oversee the program. Some of the additional staff will work closely with the four main contractors to help them meet the 80% goal.
Others will focus on compliance monitoring. A recent city audit of the program found that while overall compliance was “adequate,” it would benefit from improved monitoring of certain requirements the contractors are expected to deliver.
Expected to bring in $240 million through the end of 2025 from a one-eighth-cent slice of the city’s sales tax, Ready to Work must seek City Council approval for its annual budget each year. While the tax collection will end at the end of 2025, the program will run until the money collected is spent.
Roughly $146 million has already been collected thus far, while just over $35 million has been spent. According to the dashboard, total program expenses per participant is $6,129.
