Last week in Indiana, as our legislature geared up for its short session, Governor Holcomb delivered his State of the State address. One of the major emphases of that speech was about the importance of worker retraining.
Gov. Eric Holcomb used his nearly 30-minute speech Tuesday night to set some lofty goals, primarily in the area of educating and training Hoosier workers.
He identified more than a million Hoosiers who need better skills and set a goal of educating or retraining 55,000 Hoosiers over the next year who didn’t finish college or don’t have a high school diploma.
Although the Governor’s emphasis upon jobs and attention to other actual governance issues represents a welcome change from his predecessor’s obsession with imposing his version of biblical obedience on citizens of Indiana, this focus on retraining ignores an inconvenient reality: data continues to demonstrate that these programs mostly don’t work.
The article begins by noting that the problem is very real: automation has decimated manufacturing employment; estimates are that nine out of ten manufacturing jobs have been replaced by automation since 2000. Trade (mostly with China) has cost America another 2.4 million jobs. Of the 1.6 million manufacturing jobs that were lost during the 2008 recession, only 200,000 came back.
It’s true that trade and automation also create jobs, but they are jobs calling for very different skills than those being lost.
Most jobs that are available–primarily in computer technology, health care, and high-skill manufacturing– require training beyond high school. But despite what the article calls “decades of investment” in job-retraining programs, numerous studies have found them to be ineffective.
One problem, according to experts, is that job-retraining programs “remain rooted in the industrial era.” They haven’t evolved with the economy.
Workforce-development officials and labor economists describe four main trends in the job market that make the road from unemployment to retraining more treacherous now than it was even a decade ago. These trends, according to observers, have turned the government programs to support dislocated workers into relics of the past.
Not only do we live in an era where the skills needed to keep up in any job are changing at a much faster pace than before, but states have added licensing requirements to an enormous number of occupations. According to some estimates, those licensing requirements have cost the economy some 2.85 million jobs nationwide. Nearly 30 percent of American workers need a license these days; in the 1950s, only 5 percent did.
Researchers have also determined that the speed of retraining is critical–being jobless for a year or more permanently hinders a worker’s chance of new employment. (Retraining is actually most successful if it starts before a worker leaves his old job, but few people have the benefit of sufficient advance notice to make that feasible.)
Finally–and this pains me, but I recognize its accuracy–retraining typically is offered through a college or university, and most laid-off workers, especially older ones, have minimal interest in starting or returning to college. Worse, most colleges take far too long to create or update retraining programs. (As I discovered when I joined the faculty at my own university, lack of urgency may be the defining factor of higher education–followed closely by lack of flexibility. Unfortunately, speed and flexibility are critically important to retraining.)
Perhaps the biggest obstacle of all is the “chicken and egg” character of the problem. As the Atlantic article concludes, workers aren’t likely to waste their time retraining simply to retrain. Unless there is a specific job at the end, they won’t bother.
As with so many of the issues we face in public administration, it’s more complicated–and daunting– than it seems.
As Chambers of Commerce endlessly reminds us, employers look to locate in places with an educated workforce. In the long term, we’d get a better return on our investment of tax dollars by increasing funding for public schools.
But this is Indiana. I won’t hold my breath.