Friday, September 3, 2010

Reimagining Ready Labor

Back in the mists of time, when I worked in a clothing store during college, one of my co-workers had a second job at a local career training institute.

Being a college student myself, I suppose I looked down on those pretend colleges and wondered why people would pay good money to attend them instead of a real university.

Of course, silly me; it wasn't until my coworker/friend told me that their students' tuition is actually paid by the government that I realized how all of these career institutes stayed in business. Although my friend didn't last too long at his moonlighting position. He became disillusioned and then disgusted at the way gullible young adults with barely a GED were being snookered into student loans at these places.

Training for Unemployment?

Not that some of these training schools don't provide valuable educational services for some industries. Virtually every mechanic who works on your automobile and every dental hygienist who cleans your teeth has been trained at one of these institutes, and obviously, most of them have learned good skills for in-demand jobs. There's absolutely nothing wrong with learning an honest trade so you can earn an honest living, and take it from me: college isn't for everybody.

But as corporate America's merger craze began to heat up in the 1980's and 90's, and thousands of mostly blue-collar and lower-level white collar jobs went on the chopping block, middle America began to realize that employers weren't interested in career employees anymore. Sure, other jobs were out there, but they were of the new high-tech variety, and a chasm seemed to be spreading between existing skill sets of the newly unemployed and new demands of post-industrial specializations.

So these training schools teamed up with the government to fill the gap and provide an educational transition for folks who needed new skills for America's new world of work. It sounded logical enough. In fact, the standard line politicians of both conservative and liberal stripes began rattling off whenever a major employer announced mass layoffs invariably included something about retraining the newly unemployed.

It was as if politicians expected that as long as laid-off workers were trained for something else, new jobs would automatically open up for these re-educated people. Kind of a like a "build it and they will come" mentality. As if employers didn't know that all they needed was newly-trained workers to rehire.

Even the Best-Trained Workforce Can't Create Employment

Although some people may peg me as a liberal because I don't think capitalism is perfect, I'm more conservative than you may assume, because I know better than to expect short-sighted "fixes" like rote retraining to work in our economy.

Retraining unemployed people for different jobs doesn't mean those jobs will simply appear, does it? Not even if you're pretty sure these are the types of jobs you're expecting employers to create. Granted, if you're retraining people to be mechanics and dental hygienists, jobs we already know we need, that's one thing. But companies do not exist simply to hire people, no matter how well-trained they may be. Nobody goes to a bank and asks for a small business loan so they can simply hire a lot of unemployed people to keep them off the streets.

Whether we like it or not, and greedy companies forcing fewer workers to do more work notwithstanding, employment levels depend more on the old, immutable law of supply and demand than whether or not people are properly trained. Our economy may experience growing pains if a product is in demand for which the supply of properly trained producers is low, and pay scales may rise and fall based on how much the market demands the skills of particular workers, but simply spending the money to churn out trained workers for jobs that don't exist seems foolish.

Yet our government continues to insist that retraining programs provide an invaluable tool for fixing our growing unemployment problem. Determining how much this is costing American taxpayers is difficult to determine, since each state runs their own retraining programs and budgets. But the federal government spends billions of dollars each year ($4 billion budgeted for this year) on retraining programs of all sorts. And to paraphrase the old saying, "a billion here, a billion there, and pretty soon, we're talking about real money."

A Stupid Workforce Never Generates Profit

Unfortunately we don't have billions of dollars to waste anymore. What's even more frustrating, however, is that in the past couple of years, as unemployment hovers just south of 10% and underemployment nudges 17%, anecdotal stories have emerged of companies who say they have jobs going begging because even with all of the retraining programs out there, they can't find qualified people to fill their staffing needs.

Now, of course, a lot of this can be misleading for a number of reasons. Some workers who were laid off when their pay was $20 an hour simply have a hard time thinking new jobs requiring more skills are only worth $15 an hour. If they were over-paid before, now it seems like companies want to under-pay them. Also, a lot of the retraining that companies are looking for requires better proficiency in rudimentary English, math, and science skills than most American public school students have these days.

In a way, it's almost fantastic to consider that a public school system which used to be the envy of the world now produces bumper crops of high school graduates that can't write a complete sentence, or even read it. But that's a topic for another day. Let's assume that people who graduate from training programs can at least spell their name and count backwards from ten. The issue for us here remains how we get workers into what few new-technology jobs we've got without wasting billions of dollars doing so.

Reallocate and Reinvest

It seems to me that if we're spending billions on retraining people for jobs that don't exist, or in skills employers don't need, can't we better allocate that money? Instead of soliciting students for retraining programs under the guise of creating jobs, why can't the government simply provide lucrative tax breaks to employers to train new workers themselves? Companies could develop the curriculum they know will give their employees what they need, training could be creatively tailored to specific skills, and a well-trained workforce might make executives think twice before laying off blocks of workers simply to boost profits.

Not that profits are a bad thing, but they don't exist in a vacuum, do they? If a company's not making money, they can't pay their workers, but studies show that many of the layoffs in the past several years have been in companies with healthy profit margins. It takes a mighty cold-hearted capitalist to simply dismiss high unemployment as collateral damage for corporate revenue.

Granted, with the globalization of the world's economy, very little exists in a vacuum anymore. But the major engine for America's economic success has always been creativity and innovation. And the greater the innovation, the greater the training needed so other people can produce your great ideas.

There's still money out there in the economy. It hasn't all evaporated, has it? Aren't there any companies with ideas or products that need lots of new workers? If companies are really waiting until they can find retrained workers, why can't investors be sold on bankrolling this next era of American ingenuity and help companies invest in people again?

Capitalists keep saying the government can't save our economy.

Umm... then that means you're willing to give it a shot, right?

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