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  ·   By Gene Marks, Capitol One, Spark Business   ·  Link to Article

How To Fill The Skills Gap For Small Business? Try Training

The unemployment rate is at historic lows and employers are finding it extremely difficult to fill millions of open jobs, particularly those requiring skills. Andy Van Kleunen is the CEO of the National Skills Coalition, an organization that mobilizes support for a new national skills agenda that cuts across public policies, and simultaneously serves a wide range of U.S. workers and industries. In this Dive In, I ask Andy about how business owners can address the skills gap challenges to help them recruit better employees.
Gene Marks: How big a problem is finding skilled employees?
Andy Van Kleunen: With low unemployment, many companies—from Fortune 100 firms to small local companies — are struggling to find people with the right skills for open jobs. But the jobs we hear are the hardest to fill are those which require some kind of technical training past high school, but not a four-year college degree. We call these “middle-skill” jobs, and they represent more than half (53%) of job openings in the U.S.—more than those requiring a bachelor’s degree (31%). There’s a critical shortage of workers (43%) with the middle-skill credentials that would allow them to be hired as electricians, auto mechanics, machinists, computer coders, etc. And if you’re a small company competing with the big firms in your industry, you’re at an even greater disadvantage.
G.M. Any advice on where an employer can start to look for skilled workers?
A.V.K. There are hundreds of federally funded American Job Centers located throughout the country. These centers pay for people to attend training programs for in-demand occupations. They also connect newly trained workers to local companies. These centers are overseen by Workforce Development Boards, many of which partner with local industry or sector partnerships. A new federal law (the Workforce Innovation and Opportunity Act) requires these workforce boards to work with these industry-led partnerships. Companies that participate in these partnerships can have input into the training delivered by local colleges, high schools and other programs so that workers learn the specific skills needed to get hired.
G.M. What are smart companies doing to meet these challenges?
A.V.K. When it comes to developing cutting edge, innovative, collaborative job training, I think about Optimax Systems, Inc., a 200-person precision optics manufacturer located in the Rochester area of upstate New York.  Years ago the big local employers were Kodak and Xerox.  When they moved out, the smaller companies in their supply chain had to band together to figure out how to save the local industry.  Optimax’s president, Mike Mandina, helped to create FAME – the Finger Lakes Advanced Manufacturer’s Enterprise. And FAME, in turn, started working with three different workforce boards in the region, as well as a number of community colleges and high schools, to rebuild the manufacturing workforce in the Rochester region.  At Optimax, Mike developed the company’s apprenticeship program from scratch in order to home-grow a steady stream of technically savvy precision optics manufacturing technicians. Over the course of the three-year program, apprentices take two classes per year at a local community college that relate to optics manufacturing and rotate through all of the company’s departments. Optimax also got the other FAME companies to take the “5% pledge”—that is, for every 100 people they hire, they have to create at least 5 temporary positions for high school students, interns and the long-term unemployed to expose them to the possibility of a future career in manufacturing.  This is the kind of leadership that small companies are showing throughout the country in these sector partnerships.
G.M. Are employers doing enough training?
A.V.K. The private sector spends a tremendous amount on training current workers already—more than $170 billion annually. That’s much more than all of our federal workforce education and training programs combined.  But most of that private money is spent on highly skilled employees who already hold at least a bachelor’s or graduate college degree, even though those people represent a minority of most company workforces.  In production sectors like manufacturing, and in service sectors like retail, healthcare and hospitality, the challenge is that most entry-level workers have limited reading or math skills that make it hard for them to train for higher positions. The companies that are meeting that challenge are partnering with local schools or colleges to deliver “integrated education and training” programs, in which employees develop or refresh basic math, reading, and computer skills while learning the technical skills that meet their industry’s changing needs.
G.M.  Do you see any larger government initiatives that are potentially on the horizon to help employers find skilled people?
A.V.K. Congress is debating the reauthorization of the Higher Education Act (HEA), which currently invests more than $30 billion annually in Pell Grant financial aid to cover tuition costs for students in need. There is bi-partisan support for “short term Pell” in Congress, but we’ll need to hear from more workers and business leaders before it has a chance of being adopted as part of the new HEA.
Interested in hearing more about what Capital One is doing to arm American’s with the skills and tools they need in today’s competitive environment? Check out Capital One’s Future Edge Initiative.
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