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Fightdirecto -> Skills Don’t Pay the Bills - The "Skills Gap" Myth (11/25/2012 8:00:02 AM)
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Skills Don’t Pay the Bills by Adam Davidson, NPR's "Planet Money" in the New York Times, 11-25-12
quote:
Earlier this month, hoping to understand the future of the moribund manufacturing job market, I visited the engineering technology program at Queensborough Community College in New York City. I knew that advanced manufacturing had become reliant on computers, yet the classroom I visited had nothing but computers.
As the instructor Joseph Goldenberg explained, today’s skilled factory worker is really a hybrid of an old-school machinist and a computer programmer. Goldenberg’s intro class starts with the basics of how to use cutting tools to shape a raw piece of metal. Then the real work begins: students learn to write the computer code that tells a machine how to do it much faster.
Nearly six million factory jobs, almost a third of the entire manufacturing industry, have disappeared since 2000. And while many of these jobs were lost to competition with low-wage countries, even more vanished because of computer-driven machinery that can do the work of 10, or in some cases, 100 workers. Those jobs are not coming back, but many believe that the industry’s future (and, to some extent, the future of the American economy) lies in training a new generation for highly skilled manufacturing jobs — the ones that require people who know how to run the computer that runs the machine.
...even as classes like Goldenberg’s are filled to capacity all over America, hundreds of thousands of U.S. factories are starving for skilled workers.
Eric Isbister, the C.E.O. of GenMet, a metal-fabricating manufacturer outside Milwaukee, told me that he would hire as many skilled workers as show up at his door. Last year, he received 1,051 applications and found only 25 people who were qualified. He hired all of them, but soon had to fire 15. PART OF ISBISTER’S PICKINESS, he says, COMES FROM AN AVOIDANCE OF WORKERS WITH EXPERIENCE IN A “UNION-TYPE JOB.” ISBISTER, AFTER ALL, DOESN’T ABIDE BY STRICT WORK RULES AND $30-AN-HOUR SALARIES. AT GENMET, THE STARTING PAY IS $10 AN HOUR. THOSE WITH AN ASSOCIATE DEGREE CAN MAKE $15, WHICH CAN RISE TO $18 AN HOUR AFTER SEVERAL YEARS OF GOOD PERFORMANCE. FROM WHAT I UNDERSTAND, A NEW SHIFT MANAGER AT A NEARBY MCDONALD’S CAN EARN AROUND $14 AN HOUR. .
THE SECRET BEHIND THIS SKILLS GAP IS THAT IT’S NOT A SKILLS GAP AT ALL.
I SPOKE TO SEVERAL OTHER FACTORY MANAGERS WHO ALSO CONFESSED THAT THEY HAD A HARD TIME RECRUITING IN-DEMAND WORKERS FOR $10-AN-HOUR JOBS. “IT’S HARD NOT TO BREAK OUT LAUGHING,” says Mark Price, a labor economist at the Keystone Research Center, referring to manufacturers complaining about the shortage of skilled workers. “IF THERE’S A SKILL SHORTAGE, THERE HAS TO BE RISES IN WAGES,” he says. “IT’S BASIC ECONOMICS.” AFTER ALL, ACCORDING TO SUPPLY AND DEMAND, A SHORTAGE OF WORKERS WITH VALUABLE SKILLS SHOULD PUSH WAGES UP. YET ACCORDING TO THE BUREAU OF LABOR STATISTICS, THE NUMBER OF SKILLED JOBS HAS FALLEN AND SO HAVE THEIR WAGES.
In a recent study, the Boston Consulting Group noted that, outside a few small cities that rely on the oil industry, there weren’t many places where manufacturing wages were going up and employers still couldn’t find enough workers. “TRYING TO HIRE HIGH-SKILLED WORKERS AT ROCK-BOTTOM RATES,” the Boston Group study asserted, “IS NOT A SKILLS GAP.” The study’s conclusion, however, was scarier. MANY SKILLED WORKERS HAVE SIMPLY CHOSEN TO APPLY THEIR SKILLS ELSEWHERE RATHER THAN WORK FOR LESS, AND FEW YOUNG PEOPLE CHOOSE TO INVEST IN TRAINING FOR JOBS THAT PAY FAST-FOOD WAGES. AS A RESULT, THE UNITED STATES MAY SOON HAVE A HARD TIME COMPETING IN THE GLOBAL ECONOMY. The average age of a highly skilled factory worker in the U.S. is now 56. “That’s average,” says Hal Sirkin, the lead author of the study. “That means there’s a lot who are in their 60s. They’re going to retire soon.” And there are not enough trainees in the pipeline, he said, to replace them.
ONE RESULT, Sirkin suggests, IS THAT THE FAKE SKILLS GAP IS THREATENING TO CREATE A REAL SKILLS GAP. Goldenberg, who has taught for more than 20 years, is already seeing it up close. FEW OF HIS TOP STUDENTS WANT TO WORK IN FACTORIES FOR CURRENT WAGES.
Isbister is seeing the other side of this decision making. He was deeply frustrated when his company participated in a recent high-school career fair. ANY TIME A STUDENT EXPRESSED INTEREST IN MANUFACTURING, HE SAID, “THE PARENTS CAME OVER AND ASKED: ‘ARE YOU GOING TO OUTSOURCE? MOVE THE JOBS TO CHINA?’ ” WHILE ISBISTER SAYS HE THINKS THAT HIS INDUSTRY SUFFERS FROM A REPUTATION PROBLEM, HE ALSO ADMITTED THAT HIS ANSWER TO A NERVOUS PARENT’S QUESTION IS NOT REASSURING. THE INDUSTRY IS INEVITABLY GOING TO MOVE SOME OF THESE JOBS TO CHINA, OR IT’S GOING TO REPLACE THEM WITH MACHINES. If it doesn’t, it can’t compete on a global level.
It’s easy to understand every perspective in this drama. MANUFACTURERS, WHO FACE INCREASING COMPETITION FROM LOW-WAGE COUNTRIES, FEEL THEY CAN’T AFFORD TO PAY HIGHER WAGES. POTENTIAL WORKERS CHOOSE MORE PROMISING CAREER PATHS. “It’s individually rational,” says Howard Wial, an economist at the Brookings Institution who specializes in manufacturing employment. “But it’s not socially optimal.”
Would you (or, if you are a parent, would you advise your child to) spend the money and time for an Associates Degree to work at a job which will pay you approximately the same as a shift manager at McDonalds?
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