Can job training help solve the jobs crisis?
There are still more than four unemployed workers vying for every job opening in the country. But within certain industries--including manufacturing, health care, and engineering--employers are actually struggling to fill jobs that are increasingly demanding higher skills.
In the southern US, 51 percent of current job openings are middle-skill, but only 43 percent of the region’s workers are trained to that level, according to a recent study by the National Skills Coalition. “It's a massive problem from the point of view of the recovery,” Brad Ohlemacher, CEO of Ohio’s Precision Machining told CNN. “We can't hire and train fast enough and that means we have to turn down business.” Could job training be part of the solution?
That’s what President Obama may be betting on. In a major speech next week, he’s expected to propose support for job training as part of his renewed push for job growth, focusing especially on the 6.2 million Americans who’ve been out of work for more than six months, according to the Wall Street Journal.
Details haven’t been released, but Obama recently praised GeorgiaWorks, which gives unemployed workers eight weeks of training at a workplace. The GeorgiaWorks program, which began in 2003, has shown some tentatively positive results. “Of the 23,084 people who completed the program, 24 percent were hired by the employer that trained the person,” the Journal notes. More than 60 percent reported being employed within three months of completing the training, though it’s unclear whether they were holding steady jobs thereafter. Perhaps most notably, Georgia’s program doesn’t cost employers anything, and it doesn’t cost the state government much either: beneficiaries don’t receive additional wages, simply the unemployment benefits they would get otherwise, plus a small transportation stipend.
But experts say it’s too early to tell whether the Georgia program is truly effective. They say the initiatives most likely to produce lasting results often take longer to ramp up--and cost more. Though there’s been some federal support for job training--mostly through the Workforce Investment Act, which is up for reauthorization this year--the most innovative public training programs have been on the state level, often targeting specific industries with a growing demand for jobs.
“The best programs are ones where you target a sector with good wages and strong demand, and you work carefully with employers...some states made some important strides in building these, but they’re not programs you can build really quickly,” says Harry Holzer, a Georgetown professor and former chief economist for the Department of Labor under the Clinton administration. Under such a strategy, employers and industry associations will often come together with community colleges, technical institutes, and other organizations to devise a pipeline of training with the promise of jobs at the end, explains Andy van Kleunen, director of the National Skills Coalition.
Many states that have adopted such programs began building them up well before the recession began, drawing on both federal and state dollars. In 2006, Pennsylvania started “Industry Partnerships,” which have worked with 6,300 businesses to train more than 90,000 workers, who saw their wages rise by 6.62 percent on average after completing the program. Pennsylvania’s initiative has received strong support from industry leaders as well, who lobbied hard to turn the program into law this year.
But even programs with bipartisan support and industry backing have fallen victim to budget cuts. In Pennsylvania, state legislators zeroed out Industry Partnerships’ funding for training during this year’s budget fight. When federal funding dropped by 39 percent for Michigan’s “No Worker Left Behind” job training program during the recession, state officials were forced to make huge enrollment cuts to the initiative, which already had a waiting list.
Ultimately, the federal government could create something akin to its “Race to the Top” program for education, rewarding the states and job training programs that have shown the most success, suggests Anthony Carnevale, director of Georgetown’s Center for Education and the Workforce and a former Clinton administration official.
Some conservatives have similarly proposed creating a federal “education bank” to reward education institutes and private institutions offering job training, as the American Enterprise Institute’s Alex Brill suggests. Such programs could help solve some of the country’s long-term structural unemployment problems, fueled by a skills deficit that would exist even without the current recession. But such initiatives would entail a major federal investment that would face an uphill climb in the current political climate.
In the meantime, Washington could take its chances and experiment with less ambitious programs like GeorgiaWorks that support work experience and on-the-job training to help the long-term unemployed, who are at greater risk of having out-of-date skills. Critics of Georgia’s initiative say it simply masks low-cost labor as job training--and that demand is still too weak to encourage many firms to hire, even if the risk of hiring were lower. But the low cost of such programs could make it at least more politically feasible in the current climate of austerity. “Given the crisis, it’s worth trying,” concludes Holzer.