Emerging Industry Workforce Strategy report 01226010

Submitted by
January 22, 2010
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Table of Contents
EXECUTIVE SUMMARY................................................................................................. 1
INTRODUCTION AND PURPOSE.................................................................................. 5
INDUSTRY IDENTIFICATION ........................................................................................ 6
Theoretical Framework and Definition ......................................................................... 6
The Nexus Industries................................................................................................... 9
The Nexus Industries on the Industry Life Cycle........................................................ 11
Prioritization of the Nexus Industries.......................................................................... 13
EMPLOYMENT OUTLOOK AND SKILL SETS............................................................. 14
Employment Outlook.................................................................................................. 15
Skill Sets .................................................................................................................... 22
NEXT STEPS................................................................................................................ 28
BIBLIOGRAPHY/CITATIONS ....................................................................................... 33
APPENDIX A. METHODS............................................................................................ 35
APPENDIX B. REGRESSION DETAIL ........................................................................ 44
APPENDIX C. REGRESSION TERM DEFINITION ..................................................... 49
Tables:
Table 1: Preliminary Forecasts of MSA GDP Growth Rates by Sector ......................... 10
Table 2: 2008-2009 Average Annual Total Employment Rate of Change Forecasts .... 16
Table 3: 2008-2009 Average Annual Total Employment Net Jobs Forecasts ............... 17
Table 4: 2008-2009 Average Annual Total Employment Forecasts .............................. 19
Table 5: Nexus Industry Skill Sets................................................................................ 24
Figures:
Figure 1: Industry Life Cycle........................................................................................... 7
Figure 2: Nexus Industries in Southwestern Pennsylvania............................................. 9
Figure 3: Nexus Industry Positions on the Industry Life Cycle ..................................... 11
Figure 4: Nexus Industry Definitions............................................................................. 13
Figure 5: Nexus Skill Set Continuum............................................................................ 23

In an effort to further strengthen workforce development initiatives in the Pittsburgh region and
surrounding areas, CCAC, through the Workforce Alliance, sought to better understand regional
emerging industries, related workforce needs of those industries, and opportunities for CCAC and
the Workforce Alliance to aid in their fulfillment.
This project addresses the following driving questions:
• What are the key emerging industries in southwestern Pennsylvania and what is their
potential economic impact for Allegheny County?
• What are the anticipated job opportunities and requisite skill sets necessary for these
emerging industries to be successful?
• What role should the Workforce Alliance play as an intermediary and convener of the
emerging industries or clusters of emerging industries for CCAC?
A joint qualitative/quantitative approach was used to identify, evaluate, confirm, and further examine
high-growth and emerging industries as well as the related skill sets required by these industries.
The industries that show the most growth in employment and economic impact in terms of employer
need are those that are located at the convergence of high-growth industries — Healthcare and Life
Sciences, Energy, and Financial Services and Insurance — and the “liaison” sectors of
Manufacturing and Information Technology (Figure ES1).
Figure ES1: The “Nexus Industries”
Emerging Industry Workforce Strategy
Executive Summary
Introduction and Purpose
Findings
1January 2010

An important consideration when prioritizing the efforts of the Workforce Alliance for CCAC is the
maturity of these “nexus industries” on the industry life cycle. The nexus of Healthcare and Life
Sciences and Energy with Manufacturing and Information Technology hold the greatest opportunity
for CCAC, through the Workforce Alliance, to affect human capital needs in southwest Pennsylvania
(Emerging / High-growth “nexus industries”).
Figure ES2: “Nexus Industries” on the Industry Life Cycle
Figure ES3: Emerging/High-growth “Nexus Industry” Definitions
The definition of each “nexus industry” is characterized by the use of the knowledge, concepts, and/
or operational processes of the liaison sector in the environment of a high-growth industry to drive
further growth (Figure ES3).
Executive Summary
The “Nexus Industries”
2January 2010

While many of the firms interviewed could not identify specific occupation or position titles that they
would need as they continue to grow, they consistently voiced a desire for new talent with strengths
in the following areas:
• Technical Skills
• Experience
• Soft Skills/Work Readiness Skills
There is an emerging need for individuals to play a “liaison” role between the terms, concepts, and
operational processes conducted in each of the “nexus industries”. These “liaison skills” enable
individuals to use the knowledge base of one industry to serve the specific needs of another. Figure
ES4, displays the Nexus Industry Skill Set Continuum where employee competencies range from
traditional (competencies are focused to a single area of expertise) to “liaison” (competencies are in
multiple technical areas and can be applied interchangeably).
Figure ES4: “Nexus Industry” Skill Set Continuum
High-Growth Industry
(Healthcare,Energy,
FinancialServices)
Liaison Sector
(Manufacturing,IT)
100% 50% 0%
50%0% 100%
Traditional
Skills
Traditional
Skills
Liaison Skills
EmployerNeeds
Employers noted that prior level of experience directly relates to an employees’ success on the job.
As a result, employers tend to recruit from competitors and educational institutions that provide
experiential learning opportunities.
The roles most often discussed by employers across all “nexus industries” were:
• Research and development
• Process improvement
• Sales and customer care
• Quality assurance
• Regulatory and compliance assistance
The most apparent workforce need in the “nexus industries” is for individuals with strong soft skills
and work readiness skills as these will position the individual to address workplace challenges and
grow. These skills include:
• Critical thinking
• Independent decision-making
• Adaptability
• Ability to learn new skills quickly
• Interpersonal skills
• Emotional intelligence
3
• Ability to learn new skills quickly
• Interpersonal skills
• Emotional intelligence
January 2010
Skill Set Requirements of “Nexus Industries”
Executive Summary
Technical Skills
Experience
Soft Skills/Work Readiness Skills

It is recommended that the Workforce Alliance assume the primary role and related responsibilities
for identifying current and future industry workforce needs for CCAC while CCAC leads the
development, integration, and promotion of programs that align with fulfilling the needs identified by
the Workforce Alliance. The Workforce Alliance should consider taking seven action items – two
related to identifying industry need and five related to fulfilling industry need – to maximize its impact
on emerging workforce requirements in southwest Pennsylvania.
• Position the Workforce Alliance as primary liaison between industry and educational
programs (Figure ES4)
• Monitor economic and policy environment impacts on targeted industries
• Integrate industry experience throughout time of study
• Develop interdisciplinary study
• Incorporate foundational business concepts and soft skill development throughout
programs
• Promote career pathing into nexus industries
• Implement a formalized process for evaluating and enhancing CCAC program offerings to
fulfill industry need
Figure ES5: Role of the Workforce Alliance
4January 2010
Next Steps
Identify Industry Need
Fulfill Industry Need
Executive Summary

5
INTRODUCTION AND PURPOSE
The Community College of Allegheny County (CCAC) - Allegheny County Workforce
Alliance (Workforce Alliance) is a strategic partnership among county and state
economic development entities, local and state workforce development organizations,
the foundation community, private industry, organized labor, and training providers that
is designed to strengthen the region’s workforce development initiatives. It seeks to
enhance southwestern Pennsylvania’s economic competitiveness through this project
by identifying key emerging industries, convening the web of stakeholders (i.e.
businesses, public sector, and training providers) to identify and prioritize key issues in
these industries, and helping develop the strategic direction of the emerging clusters.
This project addresses the following objectives:
• What are the key emerging industries in southwestern Pennsylvania and what is
their potential economic impact for Allegheny County?
• What are the anticipated job opportunities and requisite skill sets necessary for
these emerging industries to be successful?
• What role should the Workforce Alliance play as an intermediary and convener of
the emerging industries or clusters of emerging industries for CCAC?

6
INDUSTRY IDENTIFICATION
The industries that show the most potential growth in employment and economic impact
in southwest Pennsylvania are those that are located at the convergence of high-growth
industries – Healthcare and Life Sciences, Energy, and Financial Services – and
Information Technology and/or Manufacturing. This trend increasingly demands that
organizations are able to adapt and apply the terms, concepts, and operational
processes in each of the high-growth industries, and the supporting processes and
technologies traditionally associated with Information Technology and Manufacturing.
This section presents the theoretical framework for the project and builds the case for
which industries the Workforce Alliance should focus its initial attention through the
identification, definition, and prioritization of key nexus industries.
THEORETICAL FRAMEWORK AND DEFINITION
The Industry Life Cycle (ILC) illustrates a general pattern of growth and decline for
products, businesses, and their industries. While multiple variations of the ILC have
been developed to address the development of product, market, and/or industry, these
variations generally contain the addition of a pre-commercialization or market
development stage and/or a subtle modification to the stage names and descriptions to
better align with the product, market, and/or industry. Below are some of the major
models that have been introduced and their related stages.1
• Fox (1973): pre-commercialization, introduction, growth, maturity, decline
• Wasson (1974): market development, rapid growth, competitive turbulence,
saturation/maturity, decline
• Anderson & Zeithaml (1984): introduction, growth, maturity, decline
• Hill & Jones (1998): embryonic, growth, shakeout, maturity, decline
Aspects from these leading models were utilized in the development of the ILC for use
in this analysis (Figure 1).
1
Value Based Management.net. Product Life Cycle – industry Maturity Stages. www.valuebasedmanagement.net. Accessed:
12/8/2009

7
Figure 1: Industry Life Cycle2
Each segment along the ILC is characterized by the maturity of the industry relative to
its products/services, processes, and operations. This maturity is defined along the y-
axis of the model through the industry’s regional GDP growth rate (RGDP Growth).
Emerging: The industry is focused on research and development to meet an
identified need for an existing or yet to be created market. Workforce
requirements at this stage generally relate to a small number of individuals with
specific expertise in the development of the product/service.
Sunrise: The industry has begun to build its market and related revenues.
Workforce requirements at this stage continue to include development expertise
but are augmented with sales and support staff to continue to assist the industry
in its continued growth.
Growth: As demand for the industry product/service continues to grow,
organizations within the industry require additional staff to fill production and
support roles. It is through this stage that employment needs exponentially
increase until the industry reaches maturity.
Maturity: The industry’s supply of the product/service is generally in equilibrium
with the demand for that good. Workforce needs in terms of volume are
generally associated with the replacement of employees leaving the industry or
the hiring of individuals who can assist the firm in realizing additional revenues
from its current market.
2
Kotler, P. and Keller, K. 2009. Marketing Management 13th
Edition. Pearson Education Inc. Upper Saddle River, NJ.

8
Decline: Demand for the industry’s product/service begins to decline leaving
industry firms with the need to reduce costs and increase efficiencies in order to
realize previous margins and remain viable. Employment volume is generally
reduced through this stage, especially related to the production functions, and
individuals similar to those found in the Emerging and Sunrise stages are brought
in to assist in reshaping the industry to meet the needs of the consumer.
Resurgence: As the alterations to the industry or firm’s structure, product, and/or
processes once again provide products and services demanded by the
consumer, at the appropriate price, the industry sees a return to revenue growth
and, if continued, movement back into the Growth stage.
The consulting team recommends that the Workforce Alliance place its initial focus on
industries within the “Sunrise” and “Growth” stages of this life-cycle as these provide the
greatest near-term potential for workforce development. Truly “emerging” industries,
while promising in the future, may not have the infrastructure necessary to support
workforce development efforts. At the other end of the spectrum, industries in
resurgence have yet to define what their modified workforce needs will be.

9
THE NEXUS INDUSTRIES
A series of discussions with regional stakeholders including representatives from
industry, education, trade associations, the public workforce investment system, and
economic development identified the following regional high-growth industries:
• Energy (extraction and/or collection, distribution, and conservation)
• Healthcare and Life Sciences
• Financial Services and Insurance
The greatest potential for sustainable growth seems to be located at the convergence of
Information Technology and/or Manufacturing and one of the high-growth industries.
These industries include:
• Energy and Information Technology
• Energy and Manufacturing
• Financial Services and Insurance and Information Technology
• Financial Services and Insurance and Manufacturing
• Healthcare and Life Sciences and Information Technology
• Healthcare and Life Sciences and Manufacturing
This model is illustrated in Figure 2 with examples of potential nexus industries provided
along each of the intersections.
Figure 2: Nexus Industries in Southwestern Pennsylvania

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The High-Growth Industries
The three high-growth industries (Healthcare and Life Sciences, Energy, and Financial
Services and Insurance) were validated through an independent, objective, and
quantitative method, with a fourth sector (Professional and Technical Services) also
showing high-growth.3
Forecasted Pittsburgh Metropolitan Statistical Area (MSA) Gross Domestic Product
(GDP) growth rates for the years 2009-2011 by two-digit industry NAICS sector included
in the analysis are displayed in Table 1. The sectors are sorted in descending order by
average annual growth rate with the top four industry sectors highlighted.4
Table 1: Preliminary Forecasts of MSA GDP Growth Rates by Sector
Industry 2009 Forecast 2010 Forecast 2011 Forecast Average Growth
Health care and social assistance 8.248% 6.370% 6.507% 7.042%
Professional and technical services 8.185% 6.283% 6.111% 6.860%
Natural resources and mining 1.983% 9.349% 6.730% 6.021%
Finance and insurance 3.963% 6.658% 7.147% 5.923%
Utilities 6.599% 5.434% 5.582% 5.872%
Accommodation and food services 7.215% 5.282% 4.289% 5.595%
Transportation and warehousing excluding Postal Service 3.179% 6.473% 5.847% 5.166%
Educational services 5.295% 4.504% 5.060% 4.953%
Information 1.932% 6.138% 6.609% 4.893%
Construction 5.886% 2.989% 5.672% 4.849%
Wholesale trade 4.185% 5.058% 4.546% 4.596%
Arts entertainment and recreation 4.400% 2.406% 5.913% 4.240%
Other services except government 2.622% 5.364% 4.141% 4.042%
Manufacturing 4.466% 2.565% 3.754% 3.595%
Real estate and rental and leasing 1.905% 4.751% 3.539% 3.399%
The continued, steady, growth of the Healthcare/Life Sciences sector, one of the
region’s perennial leaders, places the firms within that sector as a key factor in regional
GDP growth.
The Professional and Technical Services sector was not incorporated into the final
determination of high-growth sectors as growth in these service areas is generally
associated with growth in the service’s client sector (i.e. strength in the energy supply
chain sector will generally result in growth in the professional and technical services
associated with that sector). Growth in the other three high-growth sectors would have
a strong correlation to growth in the Professional and Technical Services sector as firms
are expanding and organizations are looking to solidify their strategy and enlist the
services of firms to assist in helping them reach their potential.
3
Refer to Appendix B: Detailed Regression Results for additional detail on simple and multiple regression development and
discussion on results.
4
One should be advised to not take these figures as precise predictions of future, regional, GDP growth rates as they are only able
to reflect about 53 percent of the variability in GDP growth and have been developed using a relatively small amount of
observations. However, while the numbers themselves may only represent half of the picture, the trends illustrated by the numbers
do assist in the identification of sectors whose investments in information and communication technologies years ago, may result in
high-growth over the next one to three years and provides us with a starting point upon which a more robust model (defined in
Employment Outlook and Skill Sets) can be built.

11
The emergence of Natural Resources and Mining in the third position among sectors
converges well with the new developing Marcellus Shale interests across the region and
the continued growth in the coal industry, traditionally associated with the region due to
its vast resources. This sector is paired with the Utilities sector in the fifth position to
compose the Energy Supply Chain to include the collection, generation, transmission,
conservation, and distribution of energies from traditional and alternative fuels that have
been recently of focus on a global scale.
Finance and Insurance is forecasted to be within the bottom four sectors as it relates to
2009 forecasted growth but manages to average almost 6 percent growth, due to
support from the remaining two years. While it is believed that much of that later
growth can be attributed to the sector’s efforts return to its baseline after the recent
recession, it remains a strong industry in the region and provides significant potential for
those with the appropriate competencies.
THE NEXUS INDUSTRIES ON THE INDUSTRY LIFE CYCLE
A joint qualitative and quantitative approach was used to identify the placement of the
nexus industries on the ILC (Figure 3). The criteria for placement considered the state
of the high-growth industry as it relates to regional GDP growth and the level of maturity
in the relationship between the high-growth and liaison industry segments.
Figure 3: Nexus Industry Positions on the Industry Life Cycle
Healthcare and Life Sciences
and Manufacturing
Healthcare and Life Sciences and
Information Technology
Energy and Manufacturing
Financial Services
Energy and Information Technology

12
Healthcare and Life Sciences
The regional GDP forecasts reviewed earlier in this report suggest that Healthcare/Life
Sciences is the most stable of all sectors and continues to have growth forecasts in the
top-tier of industry sectors reviewed. This continued growth places the industry within
the Growth stage of the ILC.
Healthcare/Life Sciences and Manufacturing is placed within the Growth stage of
the ILC and seen as the most mature among nexus industries. Industry
representatives discussed specific human capital needs, signifying further
development in the workforce-related needs of the industry. Occupations also
seem to be more standardized across firms in this space than what was seen in
other nexus industries. Given the mature nature of the industry, regulatory policy
focuses primarily on maintaining the health, safety, and quality standards of
industry products.
Healthcare/Life Sciences and Information Technology is placed at the end of the
Sunrise and beginning of Growth on the ILC. Industry representatives discussed
the need for developers and individuals with experience implementing and
troubleshooting electronic medical records systems. Representatives also
discussed a need for traditional healthcare occupations, such as nurses and
doctors, to have a functional understanding of information technology, particularly
regarding medical records and patient tracking.
However, many organizations remain at the initial stages of development,
certification, or implementation of these products, creating a large potential for
growth. Policy requirements relating to the privacy, security, and exchange of
patient data creates additional demand for these positions.
Energy
The energy sector (a combination of Natural Resources and Mining and Utilities) is
projected to experience steady growth in utilities and a strong surge in growth from the
mining industry - leading to stable activity in the remaining forecasted years. This
pairing of continued growth along with a strong surge places the Energy industry sector
between the end of the Sunrise and beginning of the Growth stages.
Energy and Manufacturing is placed in the Sunrise stage as the majority of the
companies interviewed identified a greater need for engineering and product
development expertise than that needed to market their product. Most of the
companies discussed rapid growth over the next three to five years in both
traditional and non-traditional energy sectors. Much of the non-traditional growth
can be attributed to the upcoming deadlines for increased efficiency and domestic
production of energy, dictated in recent policy and strengthened by customer
demand for these products.

13
Energy and Information Technology is placed between the Emerging and Sunrise
stages as many of the technologies related to this field remain in the development
and testing phases. Industry representatives identified current needs for
engineering and development personnel with production, implementation, and
support positions not being required until the firms go-to-market.
Financial Services and Insurance
This sector is seen as undergoing resurgence after the recent decline in many of the
industries within its sector based on findings of the regression analysis. The regression
analysis shows that this resurgence is in the early stages and therefore, while it is
believed that nexus industries will begin to form in the future, the shape, employment
volume, and skill set requirements related to those industries could not be defined.
PRIORITIZATION OF THE NEXUS INDUSTRIES
The industries that show the most growth in employment and economic impact are
those located at the convergence of high-growth industries – Healthcare and Life
Sciences, Energy, and Financial Services – and Information Technology and/or
Manufacturing. It is recommended that the Workforce Alliance’s initial focus is placed
on the following four industries (Figure 4).
Figure 4: Nexus Industry Definitions
It is recommended that the Workforce Alliance’s initial focus related to high-growth
industries be placed on these four nexus industries. The next section details the
employment outlook and skill sets for each.
Healthcare/Life Sciences and
Manufacturing
The development and application of
technologies that enhance the quality and
efficiency of patient care and provide
essential tools for the development of
remedies to current health issues
The development and
application of information
systems for the management of
patient information in both the
patient care and research
settings
Manufacturing
The development and
application of technologies that
enhance the quality and
efficiency of patient care and
provide essential tools for the
development of healthcare
remedies
Energy and
The development and
application of information
systems for the measurement,
monitoring, and analysis of
potential reserve, generation
efficiency, distribution channels,
and utilization of traditional and
alternative energy sources
Energy and
Manufacturing
The development and
application of technologies for
increased efficiencies and/or
decreased environmental
impacts in the extraction,
generation, distribution, and
utilization of traditional and
alternative energy sources

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EMPLOYMENT OUTLOOK AND SKILL SETS
This section provides findings regarding employment outlook for high-growth industries
and the nexus industries as well as skill sets required in each nexus industry. High-level
findings include:
• Employment Outlook
The high-growth industries identified through analysis of their regional GDP
also are growing in terms of employment
Specific occupations are difficult for nexus industry representatives to
discuss, but all indicate their respective industry is growing
Policy and regulations play a significant role in decision-making and
workforce needs in an industry
• Skill Sets
Technical skills: The analysis revealed an emerging need for individuals to
play a “liaison” role between the terms, concepts, and operational processes
in each of the nexus industries. These technical skills seem to center around
research and development, process improvement, sales and customer care,
quality assurance, and regulatory understanding
Experience: Employers noted that their employees’ prior level of experience
directly relates to their ability to be successful in the kinds of roles employers
need
Soft and work readiness skills: Soft skills and work readiness skills enable
workers to be successful in the nexus industries
The Employment Outlook sub-section provides employment data for high-growth
industries based on the second regression model, findings from interviews conducted
with industry representatives, and a review of major policies that affect the nexus
industries.
The Skill Sets sub-section provides findings regarding human capital needs based on
interviews conducted with industry representatives. The section is organized by type of
skill set – technical skills, soft and work readiness skills, and experience/education.
Findings around technical skills are discussed for each nexus industry. Soft and work
readiness skills and experience/education seem to apply to all four nexus industries and
are discussed in aggregate.

15
EMPLOYMENT OUTLOOK
Industry Employment Forecasts
The completion of a quantitative analysis on MSA “total employment”5
at the 3-digit
NAICS level of industry classifications resulted in the following:
• Industries involved (directly or indirectly) in the collection, refinement,
transportation, and transmission of energy are forecasted to have the fastest
growing total employment rate of change
• Industries in healthcare are forecasted to have the largest increase in total
employment, when viewed by the number of positions from the previous year. It
was also identified that the majority of this growth will likely be seen in medical
practitioner and other medical professional roles rather than support functions.
These positions are also generally expected to be concentrated in organizations
within the Ambulatory Health Care Services industry
• Industries in financial services indicated some recovery of lost employment due
to the recent recession. This current effort to reach their average employment
base may delay the timeline for emergence of nexus industries related to this
sector
The dependent variable used was 2007-2008 Total Employment Rate of Change and
therefore, the 2008-2009 values for this same variable were able to be forecasted. The
results of this forecast can be found in Tables 2 – 4. Industries within or primarily
related to the sectors identified as Sunrise and Growth from the quantitative and
qualitative Emerging Industry Identification have been highlighted. Refer to Appendix II:
Detailed Regression Results for additional detail on simple and multiple regression
development and discussion on results.
One will notice that those industries within, or directly related to, the energy sectors,
including the mining, distribution, and support activities for natural energy resources
compose much of the top 25 percent of the listing. Industries within the healthcare and
life sciences and finance and insurance sectors help to round out the top third.
5
NOTE: Total Employment is defined by the U.S. Census Bureau’s Local Employment Dynamics as the “Total number of workers
who were employed by the same employer in both the current and previous quarter”.
http://lehd.did.census.gov/led/gdocs/Metadata4_QWI.htm

16
Table 2: 2008-2009 Average Annual Total Employment Rate of Change Forecasts
NAICS
Code Industry Title
2008-2009 Average
Annual Total
Employment Rate of
Change
Rate of
Change
Rank
486000 Pipeline Transportation 9.05% 1
213000 Support Activities for Mining 8.71% 2
211000 Oil and Gas Extraction 7.82% 3
531000 Real Estate 5.95% 4
331000 Primary Metal Manufacturing 5.69% 5
325000 Chemical Manufacturing 4.56% 6
512000 Motion Picture and Sound Recording Industries 4.06% 7
624000 Social Assistance 2.46% 8
522000 Credit Intermediation and Related Activities 2.02% 9
339000 Miscellaneous Manufacturing 1.70% 10
523000 Securities, Commodity Contracts, and Other Financial Investments 1.65% 11
621000 Ambulatory Health Care Services 1.49% 12
721000 Accommodation 1.29% 13
493000 Warehousing and Storage 1.26% 14
561000 Administrative and Support Services 1.19% 15
332000 Fabricated Metal Product Manufacturing 1.06% 16
511000 Publishing Industries (except Internet) 0.74% 17
327000 Nonmetallic Mineral Product Manufacturing 0.73% 18
212000 Mining (except Oil and Gas) 0.69% 19
326000 Plastics and Rubber Products Manufacturing 0.52% 20
333000 Machinery Manufacturing 0.31% 21
562000 Waste Management and Remediation Services 0.17% 22
324000 Petroleum and Coal Products Manufacturing 0.09% 23
335000 Electrical Equipment, Appliance, and Component Manufacturing -0.55% 24
313000 Textile Mills -1.16% 25
713000 Amusement, Gambling, and Recreation Industries -1.22% 26
532000 Rental and Leasing Services -1.35% 27
311000 Food Manufacturing -1.38% 28
722000 Food Services and Drinking Places -1.91% 29
323000 Printing and Related Support Activities -2.00% 30
622000 Hospitals -2.61% 31
322000 Paper Manufacturing -2.81% 32
711000 Performing Arts, Spectator Sports, and Related Industries -3.17% 33
113000 Forestry and Logging -3.94% 34
337000 Furniture and Related Product Manufacturing -3.95% 35
485000 Transit and Ground Passenger Transportation -4.23% 36
334000 Computer and Electronic Product Manufacturing -4.84% 37
481000 Air Transportation -5.67% 38
321000 Wood Product Manufacturing -6.11% 39
484000 Truck Transportation -9.01% 40
315000 Apparel Manufacturing -12.06% 41
525000 Funds, Trusts, and Other Financial Vehicles -14.33% 42
LEGEND
Energy and related industries
Healthcare/Life Sciences and related industries
Financial Services and related industries
However, the picture shifts from heavy focus on energy to that of healthcare and life
sciences when those forecasted percentages are used to calculate the net effect on
average annual total employment in terms of positions (Table 3).

17
Table 3: 2008-2009 Average Annual Total Employment Net Jobs Forecasts
NAICS
Code Industry Title
2008-2009 Average
Annual Total
Employment Net Jobs
Net Jobs
Rank
621000 Ambulatory Health Care Services 15,886 1
624000 Social Assistance 14,107 2
561000 Administrative and Support Services 12,727 3
531000 Real Estate 10,192 4
331000 Primary Metal Manufacturing 9,305 5
522000 Credit Intermediation and Related Activities 8,840 6
325000 Chemical Manufacturing 8,536 7
332000 Fabricated Metal Product Manufacturing 3,980 8
493000 Warehousing and Storage 2,997 9
721000 Accommodation 2,646 10
339000 Miscellaneous Manufacturing 1,979 11
523000 Securities, Commodity Contracts, and Other Financial Investments 1,926 12
213000 Support Activities for Mining 1,862 13
512000 Motion Picture and Sound Recording Industries 1,305 14
511000 Publishing Industries (except Internet) 1,028 15
326000 Plastics and Rubber Products Manufacturing 835 16
211000 Oil and Gas Extraction 779 17
327000 Nonmetallic Mineral Product Manufacturing 777 18
333000 Machinery Manufacturing 719 19
486000 Pipeline Transportation 641 20
212000 Mining (except Oil and Gas) 367 21
562000 Waste Management and Remediation Services 109 22
324000 Petroleum and Coal Products Manufacturing 24 23
113000 Forestry and Logging -120 24
313000 Textile Mills -231 25
335000 Electrical Equipment, Appliance, and Component Manufacturing -619 26
532000 Rental and Leasing Services -1,168 27
711000 Performing Arts, Spectator Sports, and Related Industries -2,152 28
481000 Air Transportation -2,725 29
323000 Printing and Related Support Activities -2,734 30
713000 Amusement, Gambling, and Recreation Industries -3,003 31
322000 Paper Manufacturing -3,090 32
337000 Furniture and Related Product Manufacturing -3,372 33
311000 Food Manufacturing -3,810 34
315000 Apparel Manufacturing -4,019 35
321000 Wood Product Manufacturing -6,487 36
485000 Transit and Ground Passenger Transportation -7,068 37
334000 Computer and Electronic Product Manufacturing -7,644 38
525000 Funds, Trusts, and Other Financial Vehicles -9,270 39
484000 Truck Transportation -22,504 40
622000 Hospitals -26,737 41
722000 Food Services and Drinking Places -27,369 42
LEGEND
This shift from energy to healthcare and life sciences may be seen as an indicator of
industry maturity in the region as the healthcare and life sciences growth has been
occurring for some time and amassed a large amount of the region’s total employment.
Industries in the energy sector are earlier in the growth cycle, as it relates to this new
emergence, as a strong center for employment.

18
This hypothesis is also seen in the preliminary regression model (see Table 1) where
Healthcare and Social Assistance is forecasted to have a somewhat steady three-year
growth process – achieving between 6 percent and 8 percent growth in each of the
three years. Natural Resources and Mining is forecasted to grow at a forecasted 2
percent in 2009, jump to over 9 percent in 2010, and settle back to around 6.7 percent
in 2011 for a three-year average of around 6 percent.
By averaging these two perspectives, there is an emergence of a hybrid listing that
takes the rate of the increase in average annual total employment and the net jobs that
this increase is projected to produce. Table 4, below, includes all of the information
seen in Tables 7 and 8, with an additional column Rank Average which displays the
average ranking of the industry from both listings. This is also the column upon which
the listing is sorted.
With this perspective in mind, it becomes apparent that the initial industry sectors
selected remain accurate from a quantitative perspective. While there may be other
industries intermixed within the top ten in each listing, much of the forecasted growth in
these industries may be their recovery from the massive employment losses suffered in
prior years, due to the recent recession, and not indicative of the high-growth or
emergence of these industries in the region.

19
Table 4: 2008-2009 Average Annual Total Employment Forecasts
NAICS
Code Industry Title
2008-2009 Average
Annual Total
Employment Rate of
Change
Rate of
Change
Rank
2008-2009 Average
Annual Total
Employment Net Jobs
Net Jobs
Rank
Rank
Average
531000 Real Estate 5.95% 4 10,192 4 4
624000 Social Assistance 2.46% 8 14,107 2 5
331000 Primary Metal Manufacturing 5.69% 5 9,305 5 5
621000 Ambulatory Health Care Services 1.49% 12 15,886 1 6.5
325000 Chemical Manufacturing 4.56% 6 8,536 7 6.5
522000 Credit Intermediation and Related Activities 2.02% 9 8,840 6 7.5
213000 Support Activities for Mining 8.71% 2 1,862 13 7.5
561000 Administrative and Support Services 1.19% 15 12,727 3 9
211000 Oil and Gas Extraction 7.82% 3 779 17 10
339000 Miscellaneous Manufacturing 1.70% 10 1,979 11 10.5
512000 Motion Picture and Sound Recording Industries 4.06% 7 1,305 14 10.5
486000 Pipeline Transportation 9.05% 1 641 20 10.5
493000 Warehousing and Storage 1.26% 14 2,997 9 11.5
721000 Accommodation 1.29% 13 2,646 10 11.5
523000 Securities, Commodity Contracts, and Other Financial Investments 1.65% 11 1,926 12 11.5
332000 Fabricated Metal Product Manufacturing 1.06% 16 3,980 8 12
511000 Publishing Industries (except Internet) 0.74% 17 1,028 15 16
326000 Plastics and Rubber Products Manufacturing 0.52% 20 835 16 18
327000 Nonmetallic Mineral Product Manufacturing 0.73% 18 777 18 18
333000 Machinery Manufacturing 0.31% 21 719 19 20
212000 Mining (except Oil and Gas) 0.69% 19 367 21 20
562000 Waste Management and Remediation Services 0.17% 22 109 22 22
324000 Petroleum and Coal Products Manufacturing 0.09% 23 24 23 23
313000 Textile Mills -1.16% 25 -231 25 25
335000 Electrical Equipment, Appliance, and Component Manufacturing -0.55% 24 -619 26 25
532000 Rental and Leasing Services -1.35% 27 -1,168 27 27
713000 Amusement, Gambling, and Recreation Industries -1.22% 26 -3,003 31 28.5
113000 Forestry and Logging -3.94% 34 -120 24 29
323000 Printing and Related Support Activities -2.00% 30 -2,734 30 30
711000 Performing Arts, Spectator Sports, and Related Industries -3.17% 33 -2,152 28 30.5
311000 Food Manufacturing -1.38% 28 -3,810 34 31
322000 Paper Manufacturing -2.81% 32 -3,090 32 32
481000 Air Transportation -5.67% 38 -2,725 29 33.5
337000 Furniture and Related Product Manufacturing -3.95% 35 -3,372 33 34
722000 Food Services and Drinking Places -1.91% 29 -27,369 42 35.5
622000 Hospitals -2.61% 31 -26,737 41 36
485000 Transit and Ground Passenger Transportation -4.23% 36 -7,068 37 36.5
321000 Wood Product Manufacturing -6.11% 39 -6,487 36 37.5
334000 Computer and Electronic Product Manufacturing -4.84% 37 -7,644 38 37.5
315000 Apparel Manufacturing -12.06% 41 -4,019 35 38
484000 Truck Transportation -9.01% 40 -22,504 40 40
525000 Funds, Trusts, and Other Financial Vehicles -14.33% 42 -9,270 39 40.5
LEGEND

20
Occupation-Based Findings
The consultants conducted interviews with nexus industry representatives to validate
the findings of the quantitative analysis and understand the job opportunities in each
nexus industry. This section describes overarching findings regarding expected
employment growth and occupations that seem to apply to all of the industries.
High-growth occupations, other than engineers, were difficult to determine due to
dynamism that is associated with the nature of Sunrise and Growth industries. The
relatively high rate of change in the industries means that occupations are not yet fully
solidified or consistent. The companies also indicated that their regulatory and
economic environments are constantly in flux, and required skill sets may change based
on new or unanticipated regulations.
Therefore, workforce needs are not well-defined in terms of specific occupations, are
highly specialized, and are relatively small in number. Needs are discussed in terms of
skill sets and employers are looking for a combination of experience and education
when it comes to hiring. As a result, our analysis decouples job opportunities and skill
sets to mirror the way employers discuss their needs.
Industry representatives indicated that they look for specific specialties within
engineering, particularly mechanical and electrical engineers. Other specialties
included biomedical, plastics, computer science, and petroleum. They noted that these
specialties are difficult to recruit locally; many companies recruit outside the region.
Despite the difficulty naming specific occupations other than engineers, nearly all
industry representatives indicated that they anticipate growth in their respective
industries. They noted the changing policy and economic landscapes in their respective
industries weighed heavily on workforce decisions. They cited the constant state of flux
in the industry to be one reason for their difficulty in naming specific occupations or
discussing growth in terms of actual numbers.
Policy
One reason repeatedly noted for this flux was the policy environment in which each
industry functions. Policies and regulations concerning energy and healthcare and life
sciences are ample and drive many industry professionals’ motivations. With this point
in mind, the team conducted evaluations of major federal policies enacted in recent
years and their impacts on the industries identified in this project.
The regulatory requirements imposed on the healthcare and life sciences industries are
increasingly related to the creation, storage, transmission and disposal of protected

21
health information. These policies require individuals to acquire additional skill sets
beyond that traditionally associated with their profession.
Healthcare and Life Sciences: A clear contributor to healthcare policy is the presence
of the Health Insurance Portability and Accountability Act (HIPAA). HIPAA was most
recently modified in 2003, and its provisions were refined and extended in the American
Recovery and Reinvestment Act (ARRA). HIPAA provides the healthcare industry and
its affiliated industries (i.e. – health insurance) with guidelines regarding the creation,
storage, transmission, and disposal of protected health information. As patients change
doctors and/or are referred to specialists, HIPAA lays the regulatory framework for
providing the ability to exchange that information accurately and without fear of security
breach. The cost of HIPAA compliance is all but solely shouldered by those who are
required to adhere to its guidelines (covered entities and their business associates).
Furthermore, enforcement of HIPAA provisions is tightly and jointly monitored by the
Departments of Health and Human Services and Justice.
In tandem with HIPAA, the federal government passed the Patient Safety and Quality
Improvement Act of 2005 (PSQIA). PSQIA is designed to provide a clearinghouse for
the reporting of patient safety and quality control issues before they are subject to
punitive action. This measure authorizes the creation of nonprofit organizations to
gather and analyze these reports. Its intention is to (1) identify chronic problems among
healthcare entities and (2) develop common solutions for those problems. This act is
unfunded by the federal government. Healthcare communities are responsible for the
creation of these cooperative nonprofits. Consequently, enforcement measures are
comparatively low.
More recently, federal policy’s focus has become more specific. Regulation has shifted
from discussing what will be protected to exactly how that information will be protected
and by when. ARRA provides a significant source of policy change in this light.
Incorporated in ARRA is the Health Information Technology for Economic and Clinical
Health (HITECH) Act. The HITECH Act first establishes the Office of the National
Coordinator for Health Information Technology. It then requires that all healthcare
providers have an electronic medical record system by 2014. Incentives are included
for early implementation of HITECH. The federal government has appropriated grants
to that end throughout the upcoming few years. However, penalties are enforced after
the 2014 deadline.
Energy: Recent energy policy has led to an increased focus on domestic sourcing of
energy to reduce foreign dependence. It also has shifted from purely regulatory
measures in traditional energy to greater initiatives in both traditional and non-traditional
energy collection, storage, and distribution since 2005.
The first of such recent initiatives, the Energy Policy Act of 2005, was the first omnibus
energy bill passed in over ten years. Its major provisions include revamped electricity
and utility regulations. Additionally, those regulations work in tandem with mandates
and incentives for cleaner fuels and alternative energy production. Regarding workforce

22
initiatives, the Act provides incentives for training and education programs to augment
specializations to meet alternative energy research and implementation needs.
Specifically, Title XI divides workforce needs into six sections:
• Section 1101 calls for workforce trend monitoring and the creation of responding
training programs.
• Section 1102 mandates resources for (1) R&D, (2) competitive events and
internships, (3) facilitation among schools, institutes, companies, and government,
and (4) funding the National Academy of Public Administration.
• Section 1103 directs the Secretaries of Energy and Labor to coordinate guidelines
for a modernized electricity system and its resulting workforce needs.
• Section 1104 supports the National Center for Energy Management and Building
Technologies.
• Section 1105 directs DOE support for minority entry into energy and science
programs and jobs
• Section 1106 creates the National Power Plant Operations Technology and
Educational Center
The Energy Independence Act of 2007 creates a comprehensive program for the
reduction of U.S. reliance on foreign sources of energy. The Act addresses, primarily,
the following areas:
• Energy efficiency measures and standards
• Fossil fuel use, efficiency, and procurement
• Energy infrastructure research, development, and investment (Smart Grid)
• Transportation efficiency and standards
• Alternative energy research, development, and implementation
The Act additionally allocates $125 million for workforce development in green jobs
areas. Furthermore, the Act identifies needs for implementation of new and/or
restructured systems and programs. Each of those programs is to be funded by the
federal department under which it operates. Funding for programs outside the
immediate administration of the federal government is supported by a series of block
grants.
The most recent of energy initiatives is the American Recovery and Reinvestment Act
(ARRA). Energy provisions in ARRA are concentrated in Titles IV and VIII. Title IV
calls for energy standards at the state level bringing commercial buildings to more
stringent ANSI codes and residential to more rigorous efficiency standards. Title VIII
allocates $750 million to energy-related workforce training and job placement.
SKILL SETS
Human capital needs are changing rapidly in the nexus industries. They are framed by
combinations of skill sets and specialty areas. Roles are specialized and require the
ability to be flexible to adapt to changing regulatory and economic environments.
Candidates are expected to possess three traits to ensure their success – technical

23
skills that come from deep knowledge and understanding of the industry, soft and work
readiness skills, and a combination of practical experience and education.
Technical Skills
The greatest workforce need in the nexus industries is for workers with “renaissance
skills” – knowledge of more than one field and ability to apply skills across traditional
industries. This kind of technical skill is being expressed more articulately than the
need for someone who is capable of operating a complex piece of machinery or using
an Oracle database, for example. Specific technical skills still are needed; however,
employers increasingly are requiring workers to move beyond understanding of rigid
operational skills to understanding of how to apply a cadre of learned abilities to find
creative solutions to problems in an ever-changing landscape – to be the liaison
between industries.
The need for the kind of worker who understands a wider variety of industries and can
apply that knowledge across silos is critically important in the nexus industries. Tasks
are requiring new combinations of technical skills. For example, a nurse now needs
understanding of information technology to use electronic patient records or operate a
complex medical device; a quality assurance technician needs understanding of the
power industry and its unique processes and machinery. Figure 5 explains the
convergence of industries and indicates where employer’s needs are falling.
Figure 5: Nexus Skill Set Continuum
High-Growth Industry
(Healthcare,Energy,
Financial Services)
Liaison Sector
(Manufacturing,IT)
100% 50% 0%
50%0% 100%
Traditional
Skills
Traditional
Skills
Liaison Skills
EmployerNeeds
Technical renaissance skills are specific to each nexus industry. However, they seem
to center around research and development, process improvement, sales and customer
care, quality assurance, and regulatory understanding. Table 5 provides an overview of
the most often mentioned skill sets discussed in each industry and subsequent sections
provide information around technical skills specific to each industry.

24
Table 5: Nexus Industry Skill Sets
Information Technology Manufacturing
Healthcare
and Life
Sciences
Manufacturing
• Implementation and tech support
• Software development
• Understanding of regulatory
environment
• Sales skills
• Soft skills
• Deep medical background
• Engineers
• Sales and customer care skills
• Soft skills
• Understanding of safety regulations and
standards for medical devices
• Quality assurance and testing
Energy
Energy and Information Technology Energy and Manufacturing
• Engineers/developers
• Deep understanding of regulations
and legal issues
• Soft skills
• Problem solving
• Engineers
• Highly skilled trades
• Quality assurance and testing
• Understanding of regulations and
standards for equipment
• Assembly
• Soft skills
Healthcare and Life Sciences – Information Technology
The skills needed for success in this nexus industry are not yet apparent in all the
roles mentioned. However, industry representatives noted that, as information
technology is increasingly integrated into healthcare systems, general information
technology knowledge is highly desirable even in non-information technology functions.
Examples of core functions requiring this blended knowledge include billing and other
support services.
Industry representatives discussed the ability to implement and troubleshoot electronic
medical records systems as a high-demand skill set that requires a combination of
technical ability and operational/business acumen. It also is helpful to have a general
knowledge of healthcare in this specialty area. This specialty area requires
understanding of HIPAA/HITECH security regulations.
Industry representatives also discussed software development as a high-demand
specialty area that is difficult to recruit because relevant career paths are varied and not
well defined. Individuals can gain expertise through degrees in computer science,
mechanical engineering, electrical engineering, information systems. They also can be
self-taught, with no formal training. They noted that a background in healthcare would
be helpful; however, this technical skill need falls more towards the liaison industry of
information technology than the center where the two are equivalent.
Other specialty areas mentioned include field service, installation and education, and
sales.

25
Healthcare and Life Sciences – Manufacturing
Industry representatives discussed a need for salespeople and customer care more
than the need for people in development or assembly. Sales positions all required a
strong background in healthcare or at least a background selling medical devices. This
industry requires a strong technical background.
Customer care representatives, also called clinical territory managers, require a strong
clinical background in the healthcare setting where the company’s product is deployed
(e.g. nursing, respiratory therapy, critical care). These technical skills fall on the
continuum of healthcare and customer service rather than healthcare and
manufacturing.
Industry representatives also discussed a need for engineers. They most often
mentioned mechanical and electrical engineers and a variety of specialties such as
plastics, biomedical, and industrial engineering. These positions are highly specialized
and require experience working with specific types of manufactured devices.
Industry representatives discussed a need for people who are trained in product
management and have a deep understanding of regulatory issues. This role combines
healthcare and manufacturing with a third liaison skill – regulatory experience. These
people assist engineers in product development, ensure quality standards, and take
products to market. They engineer processes and manufacturing practices and provide
quality assurance.
Quality and assurance technicians were not as readily discussed as being one of the
higher growth occupations, but they were mentioned. These positions need experience
in quality control or electronic manufacturing. They also require knowledge of
healthcare products.
Assemblers were the lowest skilled position. These positions require an Associate’s
degree in electrical engineering. Industry representatives noted that these positions are
easy to fill. An understanding of healthcare products is helpful, but not required.
Energy – Information Technology
Industry representatives most often discussed a need for people in research and
development. They were unable to discuss exactly what kinds of skills were needed.
They cited a need for “people who can think,” and “backgrounds that are eclectic.” It
seems that this emerging industry’s needs best fit the definition of a “renaissance”-
worker – people who have a broad-based understanding of both information technology
and energy and can connect the two skill sets to solve complex problems. Workers
must be able to apply technical knowledge from both disciplines and utilize soft skills
and savvy to accomplish the work that needs to be done.

26
Industry representatives discussed skill sets being in research and development,
computer science, and computer programming. However, they also discussed a need
for people with backgrounds in engineering or other sciences. They noted that this
diversity is desired. They hire people with diverse backgrounds for their intellect, then
train them in specific processes and programs they would need to accomplish tasks.
Energy – Manufacturing
Industry representatives most often mentioned assembly and testing, quality assurance,
field service, advanced manufacturing, and research and development as specialty
areas that are in high demand.
Despite company-specific variation, all of the industry representatives indicated that
their needs were specialized and specific to the energy industry, noting things like “all
our positions require experience in energy and power,” “requires rotating equipment
experience,” and “90 percent of the positions are highly specialized.” One interviewee
indicated that none of their positions were truly entry-level at the Associate’s-prepared
level; and that new employees go through varying degrees of training at a local
educational institution to fill skill gaps.
Within these skill sets, the industry representatives differed on specific type of
specialization and degree of need. One interviewee indicated that research and
development was one of the two highest growth specialty areas, while another indicated
that research and development was not likely to grow.
Experience and Education
Nearly every interviewee indicated that their high-growth occupations require a
combination of education and experience. Many of the skill sets they discussed can
only be mastered on the job (i.e. experience using and working on a specific kind of
machinery or in a particular setting). The kind of work that is being conducted in nexus
industries require someone who has seen issues and been part of finding solutions in
practice. They hire only a few employees directly out of school with no practical
experience and limit the number of these hires per year.
Most skill needs require Bachelor’s-prepared candidates, given the nexus industries’
focus on development rather than large-scale production or implementation. Industry
representatives indicated that engineers, software developers, tech support, systems
analysts, sales people, customer care specialists, and project managers, for the most
part, require four-year degrees. It is important to note, however, that the educational
and experience requirements seemed to differ across companies. Someone in field
services could be Associate’s-prepared in one company, but would require a Bachelor’s
degree in another company.

27
Typically, each interviewee was able to name one or two specialty areas in which they
hire Associate’s-prepared candidates, if at all. These types of occupations most often
were in assembly (in manufacturing-related nexus industries) and quality assurance and
field service (in all nexus industries). They required at least one year of experience on
the job and specialized knowledge of the industry. A few mentioned that, despite these
positions being Associate’s-prepared, they require a unique blend of technical skills, soft
skills, and experience. Industry representatives did not indicate a need for a large
number of these types of occupations. Given their relative size and position on the
industry life cycle, their processes and operations do not yet require a large number of
support staff.
Industry representatives noted that continuing education is important for all of their
workers, given the changing landscape and rate of change in technology.
Finally, industry representatives discussed difficulty in recruiting for specialty areas,
Bachelor’s-prepared or Associate’s-prepared. Thus, many companies have national
hiring pools. They indicated that they work with staffing agencies to fill some vacancies,
recruit from competition, recruit veterans (in manufacturing-related nexus industries),
increase visa sponsorship, and use a co-op network to enhance their recruitment
efforts.
Soft and Work Readiness Skills
Companies generally indicated that they require highly skilled workers who are capable
of solving complex problems and making decisions rather than rigidly-trained, inflexible
workers.
The kinds of job tasks they discussed require a high level of independent decision
making and problem solving, such as “upgrade our platforms and work with cyber
outsourcing firms,” “understand processes and quality assurance and guide a product to
market,” and “know what machines to use and how to use them.” These kinds of tasks
require not only a deep technical knowledge of the field, but also maturity and critical
thinking. These types of positions require workers with well-developed soft skills,
interpersonal skills, and business etiquette.
Transferring knowledge between two industries requires the ability to effectively
communicate with a variety of people (i.e. someone in electronic medical records must
be able to communicate with practitioners, office staff, and outside vendors) and
contribute to a cross-functional team. They require organizational savvy because they
typically cross traditional silos – people need to know who to go to with a specific issue.
The types of roles discussed also require a strong ability to learn and adapt quickly
given the constant state of flux in the industries. They require flexibility, aptitude, and
curiosity.

28
NEXT STEPS
It is recommended that the Workforce Alliance assume the primary role and related
responsibilities for identifying current and future industry workforce needs for CCAC
while CCAC leads the development, integration, and promotion of programs that align
with fulfilling the needs identified by the Workforce Alliance. The Workforce Alliance
should consider taking seven action items – two related to identifying industry need and
five related to fulfilling industry need – to maximize its impact on emerging workforce
needs in southwest Pennsylvania.
Identify Industry Need
• Position the Workforce Alliance as primary liaison for CCAC between industry and
educational programs
• Monitor economic and policy environment impacts on targeted industries
Fulfill Industry Need
• Integrate industry experience throughout time of study
• Develop interdisciplinary study
• Incorporate foundational business concepts and soft skill development throughout
programs
• Promote career pathing into nexus industries
• Implement a formalized process for evaluating and enhancing CCAC program
offerings to fulfill industry need
Position the Workforce Alliance as primary liaison for CCAC between industry and
educational programs
In its first year, the Workforce Alliance focused on identifying and getting on-board key
community members, developing and conducting preliminary due diligence on primary
employers, and forming its infrastructure for future success. Given the success of these
early activities, it is now poised for action. The Workforce Alliance should position itself
as the primary liaison and point-of-contact for CCAC between industry firms and
educational programs with the purpose of fulfilling identified industry needs.

29
This positioning will allow CCAC, through the Workforce Alliance, to build strong
partnerships with industry and other stakeholders and, in turn, identify opportunities for
CCAC’s degree-granting and non-degree granting programs while mitigating confusion
among stakeholders regarding their multiple points of contact with CCAC (Figure 6).
Figure 6: Role of the Workforce Alliance
Monitor economic and policy environment impacts on targeted industries
In order to better understand the constantly changing workforce requirements of key
regional industries, the Workforce Alliance should perform the following monitoring
functions:
• Review of policy developments in each targeted industry and assess the impact
on workforce related needs
• Assess key economic indicators and past total employment statistics to continue
refining the quantitative model and identify future changes in workforce demand
• Develop and maintain strong relationships with industry representatives to
identify opportunities for CCAC, through the Workforce Alliance, to partner in
addressing current, and future, industry needs
The outcome of these monitoring activities should translate into the identification of
potential curriculum revisions and opportunity identification for CCAC.
Integrate industry experience throughout time of study
Industry experience was identified as a critical factor in recruiting employees. The
ability for students to attain industry experience throughout their coursework is vital for
attaining employment post-graduation.
This experience can be achieved in the following ways:
• Developing internship/externship/job shadowing agreements with industry firms
• Use of industry experts in curriculum development and classroom education

30
Develop Interdisciplinary study
As noted in this report, the skills required for many growing occupations are no longer
isolated to one area of study but have become a balance of theory and application from
multiple disciplines to assist firms in confronting the challenges they currently face.
Such interdisciplinary areas include the application of information technology and
manufacturing competencies in the areas of healthcare and life sciences and energy
firms.
This integration of multiple disciplines can be achieved through the following action
items:
• Inventory current offerings in context of the emerging industries to identify current
competencies
• Utilize current curricula to enhance existing programs of study and/or develop
new ones that mesh the competencies from multiple areas of study
• Develop specialized programs to address specific needs of industries
• Partner with other higher-education institutions to form articulation agreements to
create a single program that incorporates the strengths of all participating
institutions and increases cost effectiveness for the student. Interview analysis
suggests that Duquesne University’s Health Management Systems Bachelors
program could be a logical fit given its emphasis on clinical skills, business skills,
and information technology skills
Once these programs have been developed, the promotion of their existence to
potential students and the industries whose needs they seek to fulfill will assist both
schools in strengthening a single program enrollment and placement rates.
Incorporate foundational business concepts and soft skill development throughout
programs
While CCAC is a recognized leader for its programs with regard to technical skills, the
incorporation of foundational business concepts and continued focus on soft skill
development across its programs would assist in preparing students in the application
and communication of their technical competencies in the workplace. An understanding
of primary business, technical, and soft skills among all workforce entrants is seen as
an item of significant importance among those industries included in this study.

31
These include the development of the following:
• Foundational Business Concepts
o General understanding of business processes
o Knowledge of industry-specific processes
o Awareness of industry-specific regulatory/compliance environment
• Soft skills
o Written and verbal communication
o Critical thinking
o Independent decision-making (problem solving)
o Adaptability
o Ability to learn new skills efficiently and effectively
o Emotional intelligence
Promote career pathing into nexus industries
The emergence of interdisciplinary skill-set requirements among industries directly
translates into the ability for individuals with a balanced background to pursue career
paths outside those traditionally associated with their primary area of study.
In many cases, these paths are focused on the use of one’s primary skill-set in a
specific industry or function. For instance, the information technology professional is no
longer limited to programming or data base administration at a general level but, with a
supplemental knowledge of a particular industry, the individual can utilize their
knowledge in that specific capacity (i.e. health information systems analyst).
CCAC, through the Workforce Alliance, should continue to work to increase awareness
of all career paths stemming from each skill-set among career services, the student
body, and prospective students. This will enable each individual to be more aware of
the potential opportunities their education affords them.
Implement a formalized process for evaluating and enhancing CCAC program offerings
to fulfill industry need
The perception of the success and relevance of the CCAC and its workforce
development efforts will hinge on its ability to identify the human capital needs of
industry and respond in an efficient and effective manner. The previous four
recommendations provide suggestions for specific items CCAC should begin to
integrate across its degree granting and non-degree granting programs, based on
industry feedback and quantitative analysis. In addition to these recommendations, an
operations model should be developed to formalize the process of identifying current
and future industry needs, evaluating the ability of CCAC’s key programs to fulfill those
needs, and making any required modifications to the programs offered or related
packaging to fill the related gaps on a continuous and dynamic basis.

32
The development and implementation of this model will allow for the realization of
further efficiencies in the program development and course design processes as well as
provide opportunities for feedback from the stakeholders in the process - the students
and organizations in which they desire employment.

33
BIBLIOGRAPHY/CITATIONS
Bureau of Economic Analysis. Gross Domestic Product by Metropolitan Area.
http://www.bea.gov/regional/gdpmetro/
Bureau of Economic Analysis. Investment in Private Nonresidential Fixed Assets.
(Equipment codes EP11, ENS0, EP20)
http://www.bea.gov/national/FA2004/Details/Index.html
Bureau of Economic Analysis. Investment in Private Nonresidential Fixed
Bureau of Labor Statistics. Occupational Projections and Training Data.
http://www.bls.gov/emp/optd/ Accessed: 11/19/2009
Google News Archives. http://www.google.com/news
Kotler, P. and Keller, K. 2009. Marketing Management 13th
Edition. Pearson Education
Inc. Upper Saddle River, NJ.
Public Law 104 – 191. Health Insurance Portability and Accountability Act of 1996.
Public Law 109 – 41. Patient Safety and Quality Improvement Act of 2005.
Public Law 109 – 58. Energy Policy Act of 2005.
Public Law 110 – 140. Energy Independence and Security Act of 2007.
Title X., Sec.1002. 2007.
Public Law 111 – 5. American Recovery and Reinvestment Act of 2009. Title IV. 2009.
Public Law 111 – 5. American Recovery and Reinvestment Act of 2009. Title VII. 2009.
Public Law 111 – 5. American Recovery and Reinvestment Act of 2009. Title XIII.
2009.
U.S. Census Bureau. County Business Patterns Data.
http://www.census.gov/econ/cbp/download/index.htm
U.S. Census Bureau: Local Employment Dynamics. State of Pennsylvania.
http://lehd.did.census.gov/led/datatools/qwiapp.html
U.S. Congressional Research Service. Energy Independence and Security Act of 2007:
A summary of Major Provisions. RL34294; 21 December 2007, by Fred Sissine.

34
U.S. Congressional Research Service. Energy Policy Act of 2005: Summary and
Analysis of Enacted Provisions. RL33302; 8 March 2006, by Mark Holt and Carol
Glover.
U.S. Patent and Trademark Office. Patent Technology Monitoring Team (PTMT).
http://www.uspto.gov/web/offices/ac/ido/oeip/taf/clsstca/pastccl_gd.htm
U. S. Department of Health and Human Services. Administrative Requirements; Final
Rule. 45 CFR Part 162. 2003.
U.S. Department of Health and Human Services. Patient Safety and Quality
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U. S. Department of Health and Human Services. Standards for Privacy and
Individually Identifiable Health Information; Final Rule. 45 CFR Parts 160 and 164.
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U. S. Department of Health and Human Services. Summary of the HIPAA Privacy Rule.
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Value Based Management.net. Product Life Cycle – industry Maturity Stages.
www.valuebasedmanagement.net. Accessed: 12/8/2009

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APPENDIX A. METHODS
This appendix provides a detail project methodology organized by objective:
1. What are the key emerging industries in southwestern Pennsylvania and what is
their potential economic impact for Allegheny County?
2. What are the anticipated job opportunities and requisite skill sets necessary for
these emerging industries to be successful?
3. What role should the Workforce Alliance play as an intermediary and convener of
the emerging industries or clusters of emerging industries?
The consultants utilized a blended approach including qualitative data collection and
analysis, quantitative data collection and analysis, and a review of relevant policy and
other literature.
INDUSTRY IDENTIFICATION
This section provides an overview of methods used to identify and recommend the
nexus industries on which the Workforce Alliance should focus its preliminary efforts.
The consultants reviewed the business and policy literature to identify and adapt a
model to classify and prioritize key industries of interest. The Industry Life-Cycle (ILC)
model was chosen.
The consultants also developed and utilized five criteria to define high-growth industries:
Criteria 1: The industry’s growth rate is faster than the economy
Criteria 2: A need for change in the market has been identified or articulated
Criteria 3: New technologies are being used for applications traditionally completed by
older technologies
Criteria 4: New socioeconomic or political conditions are emerging (i.e. causing
growth, decline, or negligible impact)
Criteria 5: The industry is sustainable within the region
These criteria formed the basis for variable identification in the regression analyses and
protocol development for the interviews.
Interviews with Regional Stakeholders
The consultants conducted interviews with regional stakeholders including
representatives from industry, education, trade associations, public workforce

36
investment system, and economic development. The interviews identified what
stakeholders believed to be growing industries and their priorities for these industries.
Regression
The purpose of this stage in the model is to identify industry sectors from an
independent, objective, and quantitative viewpoint in the Pittsburgh, Pennsylvania
metropolitan statistical area (MSA) that are forecasted to have the highest growth
potential in gross domestic product (GDP).
Variable Selection
The rate of change in GDP within the Pittsburgh MSA for each sector6
was used as the
dependent variable. The following potential independent variables were selected to
assist in explaining the subsequent criteria from a quantitative perspective. Data
availability constraints prohibited the collection of all data elements at the MSA level.
Therefore, variables were collected at the most granular level possible.
• National Information Communication Technology investment7
- Criteria 3
• National Fixed Asset investment8
- Criteria 3
• Establishments within the MSA9
- Criteria 1
• Utility Patent Grants by Technology Class within the State10
- Criteria 3
• Sector News Coverage with Local and National Content Focus11
- Criteria 2
6
Bureau of Economic Analysis. Gross Domestic Product by Metropolitan Area. http://www.bea.gov/regional/gdpmetro/
7
Bureau of Economic Analysis. Investment in Private Nonresidential Fixed Assets. (Equipment codes EP11, ENS0, EP20)
8
Bureau of Economic Analysis. Investment in Private Nonresidential Fixed Assets.
9
U.S. Census Bureau. County Business Patterns Data. http://www.census.gov/econ/cbp/download/index.htm
10
U.S. Patent and Trademark Office. Patent Technology Monitoring Team (PTMT). NOTE: Subjective association between BEA
industry areas and NAICS sectors was conducted to associate grants with appropriate sectors.
http://www.uspto.gov/web/offices/ac/ido/oeip/taf/clsstca/pastccl_gd.htm
11
Google News Archives. NOTE: Collection efforts used Boolean queries that included sector name and geographic location to
return quantitative news counts at both the local (Pittsburgh) and national (Unites-States OR U.S.) level.
http://www.google.com/analytics

37
Observation Selection
The sectors detailed in Table 1 are included within the preliminary regression model. In
order to remain objective, sectors are only excluded from the analysis if related data is
unavailable at the time of review.
Analysis
The rate of change for each variable is calculated for all years analyzed to remove
some of the variability associated with industries of differing sizes and units of measure.
A simple linear regression was performed for each potential explanatory variable
against the industry’s 2005-2006 MSA GDP Growth Rate, using varying lag periods.
The objective of this analysis was to identify independent variable significance as it
relates to MSA GDP, and the coefficient direction and magnitude of the relationship.
Utilizing the information gathered from the simple linear regression, a multiple
regression model was constructed to assist in the identification of emerging sectors
within the Pittsburgh MSA. This model was used to forecast the MSA GDP rate of
change for each sector in the years 2009, 2010, and 2011.
These results are compared with that derived from the qualitative methods to determine:
1. Do discrepancies exist between the quantitative and qualitative conclusions?
What are the root findings for these conclusions?
2. Is the variable significance and coefficient direction of all explanatory variables
aligned with the general understanding of these economic relationships? If not,
what would be the cause of this unexpected result?
Table 1: Industry Sectors in Preliminary Quantitative Analysis
NAICS
Code(s) Sector
21 Natural Resources and Mining
22 Utilities
23 Construction
31-33 Manufacturing
42 Wholesale Trade
48 Transportation
51 Information
52 Finance and Insurance
53 Real Estate and Rental and Leasing
54 Professional, Scientific, and Technical Services
61 Educational Services
62 Health Care and Social Assistance
71 Arts, Entertainment, and Recreation
72 Accommodation and Food Services
81 Other Services (except Government)

38
Policy Analysis
The consultants selected, reviewed, and analyzed specific federal regulations and
policies to assess their potential impact on industry growth based on the preliminary due
diligence with regional stakeholders. The selected policies include those listed in Table
2. A detailed explanation of the policy evaluation and list application can be found on
page 42 in this appendix.
Table 2: Policies Selected for Evaluation
Industry Policy Title
Year
Enacted/Modified
Healthcare and
Life Sciences
Health Insurance Portability
and Accountability Act (HIPAA)
1996/2003
Patient Safety and Quality
Improvement Act (PSQIA)
2005
Health Information Technology
Act (HITECH)
2009
Energy
Energy Policy Act 2005
Energy Independence and
Security Act
2007
American Recovery and
Reinvestment Act (ARRA)
2009
EMPLOYMENT OUTLOOK AND SKILL SETS
Next, the consultants focused on identifying the employment outlook and skill sets
necessary to be successful in each nexus industry. This was accomplished by
conducting a secondary round of interviews with stakeholders in each nexus industry;
developing a second regression model to forecast total annual employment; and
continuing to evaluate policies affecting each nexus industry.
Interviews with Industry Stakeholders
The consultants compiled a list of potential interview contacts in each nexus industry
using the following resources:
• Dunn and Bradstreet data
• Pittsburgh Business Times, Book of Lists
• Pittsburgh Business Times and Pittsburgh Post-Gazette articles
• Allegheny Conference on Community Development and Pittsburgh Regional
Alliance, Regional Data
• Pittsburgh Technology Council’s Membership Directory
• Leaders in the field and recommendations from industry representatives

39
The list was refined using the following criteria:
• Relevance – the consultants conducted background research on each company
using their website to determine if the company truly participates in one or more
nexus industries
• Relative size – the consultants strove for a mix of large and mid-sized
organizations, relative to the average size of organizations in each industry
The consultants contacted 92 human resources managers, recruiters, and other
workforce experts across the nexus industries. This effort yielded 26 phone or in-
person interviews. Table 3 shows the total number of companies contacted within each
nexus industry and the specific companies with whom interviews have been conducted.
Table 3: Companies Interviewed in Each Nexus Industry12
Information Technology Manufacturing
Healthcare
and Life
Sciences
7 completed; 27 contacted
• Children’s Hospital
• Duquesne University, Health
Management Systems
• TeleTracking Technologies Inc.
• TEK Systems
• Quest Diagnostics
• Vale-U-Health
• ANSYS
6 completed;20 contacted
• Haemonetics Corp.
• Circadiance
• Phillips Respironics
• Neurointerventions
• CardiacAssist, Inc.
• Pittsburgh Life Sciences
Greenhouse
Energy
• ANSYS
• Eqt Corp.
• Allegheny Energy
• Rosebud Mining
• Pittsburgh Technology Council
• WeatherWise
• MLS Electrosystem
• ConverTeam
• Elliott Company
• Plextronics
• Westinghouse
• Mitsubishi Electronic Power
Products, Inc.
• Pittsburgh Technology Council
12
Count of interviews completed is more than total number of interviews as some interviewees could speak to more than one nexus
industry

40
Quantitative Analysis
The purpose of this stage in the model is to identify potential explanatory variables, their
significance, magnitude, and coefficient direction, in forecasting the rate of change in an
industry’s annual “total employment”13
using an objective methodology, independent
from the qualitative review.
Variable Selection
This iteration of the model uses the growth rate of an industry’s annual total
employment14
as the dependent variable to better forecast specific human capital
requirements vis a vis growth in occupations in the Pittsburgh MSA.
The following variables utilized in the preliminary regression analysis, and strongly tied
to the initial Growing Industry Definition Criteria (GIDC), were included as potential
explanatory variables in the second regression model.
• National Information Communication Technology investment15
- GIDC 3
• National Fixed Asset investment16
- GIDC 3
• Industry News Coverage with Local and National Content Focus17
- GIDC 2
• MSA Gross Domestic Product (GDP)18
– GIDC 1
However, data availability constraints prohibited the collection of data elements at the
MSA scale. Therefore, variables were collected at the most granular scale possible.
A review of the Bureau of Labor Statistics’ Occupational Projections and Training Data
indicates that job replacements and job growth are two of the main criterion for
forecasting human capital needs. It was also noted that, in “most occupations”,
vacancies due to replacements outnumber those openings due to job growth. These
findings prompted the inclusion of two additional dependent variables for analysis:
• Pittsburgh MSA Industry Separation Rate19
• Pittsburgh MSA Industry Job Creation Rate20
13
14
SOURCE: U.S. Census Bureau: Local Employment Dynamics. State of Pennsylvania.
15
SOURCE: Bureau of Economic Analysis. Investment in Private Nonresidential Fixed Assets. (Equipment codes EP11, ENS0,
EP20) http://www.bea.gov/national/FA2004/Details/Index.html
16
SOURCE: Bureau of Economic Analysis. Investment in Private Nonresidential Fixed Assets.
17
SOURCE: Google News Archives. Collection efforts used Boolean queries that included industry name and geographic location
to return quantitative news counts at both the local (Pittsburgh) and national (Unites-States OR U.S.) level. To further strengthen
this variable for the model, the value of the news variables is a rate of change in the percentage of total news coverage that was
identified as being linked to the industry. http://www.google.com/analytics
18
SOURCE: Bureau of Economic Analysis. Gross Domestic Product by Metropolitan Area. http://www.bea.gov/regional/gdpmetro/
19
NOTE: Separation rate was calculated by identifying all areas in which the total employment in an industry declined year over
year within a specific age group, summing those differences, and dividing that number by the sum of the annual total employment
for all age groups in the prior year. This results in the percentage decrease in total employment from one year to the next (or rate of
separation). SOURCE: U.S. Census Bureau: Local Employment Dynamics. State of Pennsylvania.

41
It was also determined that in order to incorporate all explanatory variables identified as
having potential significance, the model would not be able to forecast beyond the three-
digit NAICS code.
Observation Selection
The regression model includes the industries detailed in Table 4. Industries are only
excluded from the analysis if related data is unavailable at the time of review.
Table 4: Industries in Secondary Quantitative Analysis
Analysis
The rate of change for each variable was calculated for all years analyzed to remove
some of the variability associated with industries of differing size and units of measure.
A simple linear regression was performed for each potential explanatory variable
against the industry’s 2006-2007 MSA Total Employment Rate of Change using varying
lag periods. The objective of this analysis was to identify independent variable
significance, as it related to MSA Total Employment, and identify the coefficient
direction and magnitude of the relationship.
Utilizing the information gathered from the simple linear regression, a multiple
regression model was constructed to assist in the identification of industries within the
Pittsburgh MSA that were perceived to have the largest employment growth in the near
future. This model was used to forecast the 2008-2009 Pittsburgh MSA Employment
growth rate and 2009 total employment figures within each observed industry.
These results were compared with that derived from the qualitative methods to
determine:
20
SOURCE: U.S. Census Bureau: Local Employment Dynamics. State of Pennsylvania.
NAICS
Code Industry Title
NAICS
Code Industry Title
113000 Forestry and Logging 481000 Air Transportation
211000 Oil and Gas Extraction 484000 Truck Transportation
212000 Mining (except Oil and Gas) 485000 Transit and Ground Passenger Transportation
213000 Support Activities for Mining 486000 Pipeline Transportation
311000 Food Manufacturing 493000 Warehousing and Storage
313000 Textile Mills 511000 Publishing Industries (except Internet)
315000 Apparel Manufacturing 512000 Motion Picture and Sound Recording Industries
321000 Wood Product Manufacturing 522000 Credit Intermediation and Related Activities
322000 Paper Manufacturing 523000 Securities, Commodity Contracts, and Other Financial Investments
323000 Printing and Related Support Activities 525000 Funds, Trusts, and Other Financial Vehicles
324000 Petroleum and Coal Products Manufacturing 531000 Real Estate
325000 Chemical Manufacturing 532000 Rental and Leasing Services
326000 Plastics and Rubber Products Manufacturing 561000 Administrative and Support Services
327000 Nonmetallic Mineral Product Manufacturing 562000 Waste Management and Remediation Services
331000 Primary Metal Manufacturing 621000 Ambulatory Health Care Services
332000 Fabricated Metal Product Manufacturing 622000 Hospitals
333000 Machinery Manufacturing 624000 Social Assistance
334000 Computer and Electronic Product Manufacturing 711000 Performing Arts, Spectator Sports, and Related Industries
335000 Electrical Equipment, Appliance, and Component Manufacturing 713000 Amusement, Gambling, and Recreation Industries
337000 Furniture and Related Product Manufacturing 721000 Accommodation
339000 Miscellaneous Manufacturing 722000 Food Services and Drinking Places

42
1. Do the industries forecasted as having the highest growth and largest number of
positions reject our phase I hypothesis on the growing sectors?
2. Do discrepancies exist between our quantitative and qualitative conclusions?
What are the root findings for these conclusions?
3. Is the significance and coefficient direction of all explanatory variables aligned
with the general understanding of these economic relationships? If not, what
would be the cause of this unexpected result?
Policy Impact
With the notion that regulatory conditions often drive industry changes and/or
innovations, the team evaluated major policies and policy changes regarding the
industries in question. Major policies were selected based on (1) their relevance to
identified high-growth industries, (2) their recency on the federal legislative agenda, and
(3) their coinciding with spikes in news coverage concerning the issue they confront.
Those policies were evaluated using the metric designed by the project team shown in
Table 5 below.
Table 5: Policy Impact Evaluation Tool
1 - Low 2 3 4 5 - High
Scope
Few, less significant
elements affected
Few elements of
greater significance
affected
More elements of less
significance affected
More elements of
greater significance
affected
Most elements
affected
Magnitude
Implementation has
little to no impact on
industry
Implementation has
minimal impact on
industry
Implementation has
some impact on
industry
Implementation has
considerable impact
on industry
Implementation
requires complete
restructuring within
industry
Longevity
In effect for less than
1 year In effect for 1-3 years In effect for 4-5 years
In effect for 6-10
years
In effect for greater
than 10 years
Time Sensitivity
Will take effect in
more than 10 years
Will take effect in
between 6 and 10
years
Will take effect in
between 4 and 5
years
Will take effect in
between 1 and 3
years
Will take effect in
less than one year
Compliance Cost
Funded completely by
third party (non-
industry) sources
Primarily funded by
third-party (non-
industry) sources with
some matching
Joint third-party (non-
industry) and industry
firm cost sharing
Primarily funded by
industry firms with
some incentive from
third-party (non-
industry) sources
Entirely funded by
industry firms
Enforcement
Incentive-driven with
little to no
enforcement structure
Incentive-driven with
potential for future
enforcement
Disincentive-driven
but with weak or non-
existent enforcement
Disincentive-driven
with moderate
enforcement
Disincentive-driven
with strong
enforcement
Impact Levels
Criterion
The consultants selected the criterion above to capture an overarching view of a policy’s
impact on identified industries and its possible impacts on human capital issues:
• Scope – While a policy might impact a targeted industry, how much of that
industry is affected assists in determining how much of that industry and how
many occupations also are affected.
• Magnitude – The size of the impact is not limited to number of elements, but also
how deeply those elements are changed.

43
• Longevity – While some policies may have sizable impact, that impact may not
affect longer-term outlooks for an industry. For example, Cash for Clunkers had
significant impact but ended after a very short period of time.
• Time sensitivity – Timing of policy implementation may not be immediate. While
many begin “from the date of enactment of this Act,” some allot a specific time
frame prior to their taking effect.
• Compliance cost – While many resources are committed from many parties in a
policy, legislation generally delineates what portions of government support will
be provided. The rest is taken on by an industry group.
• Enforcement – Enforcement measures are often incorporated into legislation.
This criterion examines not only those measures but the likelihood of their being
enforced.
NEXT STEPS
The consultants used the results from interviews with regional and industry stakeholders
and policy analysis to develop recommendations contained in the Next Steps section.

44
APPENDIX B. REGRESSION DETAIL
This appendix includes the detailed results of both regression models, including the
results and analysis of both the simple and multiple regressions completed to support
the results discussed in the general report.
EMERGING INDUSTRY IDENTIFICATION
Simple Regression
As described in Appendix I: Methodology, a simple regression analysis was conducted
for each of the potential explanatory variables, at various lags, in order to identify their
significance, coefficient location, and magnitude of impact on the dependent variable
(MSA GDP Growth Rate). Table 1 below illustrates the results of the simple regression
on each variable.
Table 1: Explanatory Significance, Magnitude, and Direction - Simple Regression on
MSA GDP
Much of this lack of significance seen in the independent variables can be attributed to
the fact that, due to the lack of required data, this review was conducted at the industry
sector (2-digit NAICS level). Analysis at this level introduces a large degree of
variability between the industries, and to some extent, the firms composing each sector
that could not be explained by independent variables. Further information on the data
source and rationale for selecting each variable can be found in Appendix I:
Methodology.
The results of the simple regression exercise identified Information Communication
Technology (ICT) Investment rate of change as a strong variable in explaining MSA
GDP variability. The two instances of ICT variable significance resulted in an ability to
explain between 24 and 30 percent of the variability in the associated sector’s MSA
GDP growth rate. All other did not indicate significance in explaining industry sector
MSA GDP for Pittsburgh, PA.
Independent Variable: Lag (-1) Lag (-2) Lag (-3) Lag (-4) Lag (-5) Lag (-6) Lag (-7)
Approximate Percentage of Local News (RoC) NS NS NS NS
Approximate Percentage of National News (RoC) NS -0.056
†
NS NS
Establishment Growth (RoC) NS NS
Fixed Asset Investment (RoC) NS NS NS NS
Information Communication Technology Investment (RoC) NS NS NS 0.068
†
NS NS 0.128*
Utility Patent Grants (RoC) NS -0.052
†
NS NS NS
†
Significant at a P-value of 0.10
* Significant at a P-value of 0.05
** Significant at a P-value of 0.01
NS - Not Significat at a P-value of 0.10 or below
RoC = Rate of Change
Lag (Years)

45
Multiple Regression
Based upon the results of the simple regression the ICT investment variable at a four -
and seven - year lag was incorporated within a multiple regression model in order to
provide preliminary direction as to which sectors would be experiencing the most growth
in the near future. A Boolean variable, “High Reliance” was also included within the
analysis21
.
In this model, the ICT ROC (-4) and ICT ROC (-7) variables were significant at the 0.10
level and the Boolean variable not significant below a P-value of 0.10, but showing
improvement in the model through the Adjusted R Square value. The significance of
the model’s F-statistic was also significant at the 0.05 level. Table 2 below displays the
key statistics from the preliminary regression.
Table 2: MSA GDP Regression - Key Statistics
Variable Coefficients P-value Standard Error
Multiple R 0.7280 Intercept 0.0363 0.0047 0.0103
R Square 0.5300 ICT RoC (-4) 0.0637 0.0576 0.0300
Adjusted R Square 0.4020 ICT RoC (-7) 0.0935 0.0938 0.0510
Standard Error 0.0250 High Reliance (Boolean) 0.0185 0.1987 0.0135
Observations 15
Significance F 0.034
Regression Statistics
INDUSTRY AND HUMAN CAPITAL ANALYSES
With the high-level industry sectors forecasted to have the highest growth in MSA GDP
isolated, the purpose of this stage in the model is to determine the industries that have
the greatest potential for growth related to “total employment”22
. A secondary output
from this analysis is the identification of potential explanatory variables, their
significance, magnitude, and coefficient direction, in forecasting total employment to
assist in the development of a repeatable method for identifying areas of interest for the
Workforce Alliance and the Community College of Allegheny County as a whole.
While the sectors believed to have the highest potential for growth were identified in the
initial regression, this model remains objective and independent from the qualitative
reviews performed and the initial quantitative analysis. Refer to Appendix I:
Methodology for additional information.
21
The “High Reliance” variable was included to indicate whether the industry was traditionally highly reliant on technology as it
would be expected that those industries that are not generally highly reliant on technology would have a different relationship with
ICT investment than those that are.
22

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