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Dec 2, 201306:59 AMVan Lines

with Joe Vanden Plas

It's time to tackle the skills gap

(page 1 of 2)

From the pages of In Business magazine.

Before the October surprise of 204,000 new jobs, the U.S. economy created 163,000 jobs in September (revised upward from 148,000) and averaged 190,000 new jobs per month over the prior year. While October marked the 44th consecutive month of job growth, we’re creating jobs at such a moderate pace that it will take several more years to recover all the jobs lost in the Great Recession. Many elected officials don’t seem to have noticed, but there appears to be a structural transformation underway that must be addressed if employers expect to find the labor they need, not only to function but also to flourish.

Author Edward Gordon has not only noticed this transformation, he has written in-depth about it in Future Jobs: Solving the Employment and Skills Crisis. By now, the term “skills gap” has been tattooed on the brains of employers, and I plead guilty. I’ve been among those applying the tattoo, but I offer no apologies because the skills gap is real — and real concerning.

At the moment, about 11.3 million Americans are unemployed and millions more are underemployed. Gordon notes that some of the blame for employer hesitation can be pinned on the financial crisis of 2007-09; however, the main culprit is that we aren’t producing workers with the right skills to replace the 79 million baby boomers who will retire over the next 20 years.

This mismatch between individual skill and employer need is due to a structural change — from the computer age to what Gordon calls the “cyber mental age” — that leaves low-skill workers behind. Gordon says that to upgrade those skills, corporations should be allowed to depreciate their investments in human capital, just as they can depreciate physical capital investments, and spread the direct and the wage costs of training over several quarters. To further incentivize job training, he proposes that small businesses be eligible for income tax credits for that purpose, and he espouses reforming our rather archaic education-to-employment model to ease the transition from school to career.

Many regions are wisely not waiting for the politicians to wake up and smell the coffee. Gordon cites the emergence of Regional Talent Innovation Networks, or RETAINS, including the New North organization in Wisconsin, that have been organized to address population, workforce, and business erosion. They are some differences between them, but a common feature is business investment in education, worker training, and apprenticeship training. “They are not meant to replace the components of the education-to-employment system, but to get them to work better,” Gordon says. “That is what they have been doing.”


Dec 5, 2013 01:22 pm
 Posted by  Anonymous

We are probably 20 years late on this issue and the way we handled welfare reform in the 1990s probably made it worse. The key here is not what you do on the back end of the education system as described here but the front end in early childhood education where future workers brains develop- there we are way behind a large amount of the developed world. We are not only not providing good quality help to low income at risk families but I regularly run into children from middle class homes with language delays. End result is the pool of adults able to trained in many of these skills is a lot smaller than it needs to be.

A little up front prevention will save a lot of later cost and boost the economy in the future but most business advocates are not interested in the future beyond next year and I don't have much hope that will change. After all the state tooj $25 million this year out of early childhood programs in low income child care (rather than pay market rates to these small businesses) and diverted it to the new Economic Development Department to be given out often in what seems to be questionable loans and grants.

Children are a lot lower priority here than in many other states which is why over the past 20+ years we have dropped as a state from the top ten in the country to the middle for early childhood education .

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