Talent Funds – They can operate at the tech hub, city, state, or national level

Public talent investment funds (TFs) come with a clear business case for action: attracting and retaining top talent generates a substantial return on investment.

• TFs present a novel, actionable, and scalable solution that meets the size of the global talent shortage—the combined cost of which is in the trillions of dollars.
• Funds can be established on the national, state, or city level, or as part of a new tech hub. They can complement existing workforce development efforts and can be deployed to attract and retain all kinds of talent: global, local, highly skilled, or deskless workers.
• Governments can work with the private and civil sectors to realize this opportunity and build a new foundation for national economic, technological, and geostrategic advantage.

TFs can operate at the tech hub, city, state, or national level. They consist of a small, well-networked team that receives seed funding from a government entity (such as a department of labor or state-level economic development agency) or a pool of private sector actors (a chamber of commerce or philanthropists, for example). Such a fund is empowered to invest the money in an ecosystem of specialized private sector vendors, nongovernmental organizations (NGOs), and higher-education providers—all of which participate in an outcomes-based funding model to ensure that any payments are linked to measurable impact.

On the whole, TFs do not behave like traditional service providers, but like fully empowered owners. Their closest conceptual analog in government are sovereign wealth funds, which operate with an equally high degree of freedom, small teams, and a focus on meeting the fiscal and industrial policy objectives of their host country.

The financial benefits at stake are significant. We modeled the business case for a modestly sized TF that attracts 1,000 highly skilled workers a year who pay income and sales taxes, and draw on public health care and education services. It would require an initial investment of about $15 million, would be self-funding after 20 months, and after four years of operation would generate a net fiscal value of $180 million. These figures illustrate that the attraction of highly skilled talent is a public activity with huge upside potential and outsize returns, making it a government activity with one of the greatest fiscal returns on investment.

Chosen excerpts by Job Market Monitor. Read the whole story @  Global Workers, Local Impact: Power of Talent Funds | BCG