Addressing the skills mismatch with regional planning

Governments have few quick-fix tools in their arsenal to help their region rebound from an economic shock like a deep recession or an industry collapse. While we would all love a silver bullet for ailing economies, the reality is, there is no such thing. Economies take time and planning to reset their course. And key to plotting the new long-term course is an educated workforce–an area where government does play a role.

As a recent report by the Georgetown Center on Education and the Workforce put it, “The days are long gone–and they’re aren’t coming back” when a high school grad could walk into a factory and land a good-paying job. The economy has shifted to higher-skilled jobs requiring more and more education, even in manufacturing.

Education is key to economic security. But as the Center’s report “The Midwest Challenge: Matching Jobs with Education” [pdf] notes, not all education is equal. Not all post-high-school education will result in good jobs that pay a living wage.  ”Occupations matter, industries, matter, and degree types matter,” the authors Anthony Carnevale and Nichole Smith point out. Yet too few people seeking new skills or just starting out realize this. The result is a mismatch between intentions and workforce realities.

“Colleges need to better streamline their programs so as to emphasize employability–both in fields and in jobs that pay a living wage,” Carnevale and Smith argue.

Paul Dvorak of Windpower Engineering and Development talks about this mismatch in a recent column for the industry’s trade magazine  (not yet online). Wind turbines are made up of high-precision parts, requiring skilled machinists. But finding those skilled trades-people is nigh impossible, he reports. As Baby Boomers retire, they take their years of experience with them, and the new flood of young people (if they think of manufacturing at all) is not trained in a targeted way.

A wind turbine company near Chicago and a speciality machinists in Ohio both say they have unfilled positions for skilled machinists–jobs with starting salaries of $15 an hour, topping out at $27 an hour for the firm in Ohio. Both companies have modest training programs but they need more help.

What we need, Carnevale and Smith argue, is a good system for matching those job opportunities with education programs.

And that’s where the business community and government can combine forces. In fact, as a recent discussion with BRR members Ned Hill, Hal Wolman, and Howard Wial revealed, governments are limited in their response to economic or other shock in the short run, other than help their citizens cope with the fallout. Governments can, however, try to prepare for economic shocks by being ready when the lightening bolt strikes. The local government in Seattle, for example, made sure its population was ready when the lightening bolt called Microsoft opened its doors.  The city had cultivated engineers and a high-tech workforce, so they were ready. They had matched the skills to the emerging industry’s need.

Increasingly, economic development stretches beyond political boundaries of states or counties. In a global economy, regional efforts are needed in both industry and education. Carnevale and Smith call for a regional approach to developing a comprehensive system to help people match their education with their career ambitions. That system should show workers and young people where the jobs are and how to train or retrain for them.

“A key step for forward-thinking state governments” the authors write, ” will be to develop an information system to help both states and individuals make well-informed decisions about education and career choices based on the current and impending needs of the economy. Despite the enormous potential, no such comprehensive system exists across states to help people match their educational preparation with their career ambitions.”

Specifically, the system should make clear which credentials are worth more than others and by how much by connecting wage records to transcript data. It should allow students to identify “in bite-sized, attainable clusters” the courses they need to go from point A to B. It should closely align the curricula with occupational requirements and track how effectively schools are preparing their students for “real” jobs. And it should assess the value of industry-based certificates and state licences, their prevalences, and their marginal value to formal education levels.

Although the authors focus on existing data sets and information (mostly in government databases) as the foundation for this system, the “match” cannot be done without careful and coordinated input from business. Regional alliances of business, civic, and government organizations are needed.

Mark Drabenstott in “Past Silos and Smokestacks,” a Chicago Council on Global Affairs Heartland Paper,  discusses several such regional alliances in the Midwest that are forging new industries and spurring entrepreneurship, with education at the forefront. In northeastern Minnesota, for example, the True North Initiative turned seven county-level community colleges into one regional college, sparking a major new development strategy throughout Minnesota’s Arrowhead region. The Southern Minnesota Regional Competitiveness Project, which spans 38 counties, is developing a joint bioscience initiative that centers on the Mayo Clinic, the  Hormel Institute, and the area’s farmers. Training future workers to fill the jobs created will be critical to their success.

Yet as governments face budget shortfalls in this current recession, they are cutting back on the very tools that can carry regions into a successful future–investments in education and training. As Carnevale and Smith note, “Letting the current budgetary woes cut investment in these institutions is economic self-sabotage.”

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