Finding—or developing—the right person for the job?
By Terri Helmlinger Ratcliff
In the same way that the factory environment is much different today than it was five, ten, or twenty years ago—especially in terms of automation—the workforce environment has also changed. That should not surprise us, but we seem to be taking a long time to adapt to the new situation.
What has not changed is that all companies, sooner or later, need people to fill positions. With increased reliance on automation, we may need less unskilled labor, but in truth we often need highly skilled people for critical positions. Companies need fewer operators, perhaps, but still need designers, engineers, and maintainers to keep the line tuned up and running smooth.
Many companies are having trouble finding people with the right skills. At the Industrial Extension Service, we frequently hear that companies have positions open for specific skill sets but are not filling them.
Unfortunately, some of these companies do not seem prepared to develop the right skills in people. On-the-job training opportunities have declined as companies have “passed the buck” on training. Rather than taking responsibility or committing internal resources to develop their employees, these companies look to community colleges and other institutions for specialized training, then express dismay when their hiring pipelines empty out.
I wonder if this is because companies treat training as a sunk cost, rather than an investment with a payoff to the company. This may be driven by strict emphasis on the bottom-line and the quarterly dividend. After all, it is hard to show training as a profit center.
To some degree I can understand this, since a company’s mission is to make a product or deliver a service, not specifically to train people. They may minimize in-house training if they see little value added from it, and in hard times they may decide training is an easy thing to cut. But often the specialized offerings that outside agencies developed go under-utilized, since jobseekers may not pursue training if they are not sure it will land them a job. As these specialized programs fail to thrive, the institutions that started them are less likely to develop new ones, and taxpayers may feel their money has not been well spent.
I see problems mounting when companies find it difficult to fill job openings but cannot—or will not—train willing candidates. If this continues, companies may lose the in-house skills to perform high-value tasks, and end up forced to outsource them.
This will not be solved quickly or easily. To get started, I would ask companies and industry groups like ISA to begin answering some questions:
- Can we afford NOT to invest in internal training?
- Can we agree on common training needs, topics, strategies, etc.?
- If we can agree on some common elements, can we combine resources and/or develop partnerships to improve training offerings and trainee success?
On my side of the fence—government and academia—we need to answer some questions, too:
- Can we determine what factors may predict a person’s success in company/industry training programs?
- If so, can we help companies and industry to identify and recruit people who are likely to succeed?
- Can we discover economic principles about (or develop recommendations about) the payoff companies can expect from training?
- If so, can we help companies decide when in-house training is better than outsourced training, and possibly help develop cooperative approaches to filling critical needs?
With training, as with any investment, we must put something in and accept some amount of risk before we get the payoff. Currently, companies put as little as possible into training (usually through taxes, sometimes through grants or equipment gifts or tuition), and accept the risk of not having the trained, skilled workforce they need. It would be far better if companies found the optimal level to invest in in-house or cooperative training, and thereby reduce the risk that their production lines and businesses will be interrupted by skill shortages.
Unfortunately, it seems the situation is likely to get worse before it gets better. The environment today is different from what it used to be, and a few years from now it will be different still. We need to get started, to figure out how to stave off a future with too few skilled workers.
ABOUT THE AUTHOR
Terri Helmlinger Ratcliff is the Executive Director of the Industrial Extension Service and the Interim Vice Provost for Outreach and Engagement at North Carolina State University.