America’s missing workers – matching jobs to the jobless
WASHINGTON: A few years ago, Derek Hobbs could not find a job. He had three strikes against him: his age, 55, a criminal record, and a drug addiction that kept him out of the formal workforce for more than 25 years.
When he decided to turn his life around, most employers dismissed him without a thought. Determined to succeed, Hobbs turned to an innovative programme specialising in matching people facing employment challenges, to available jobs.
“They actually give people with those strikes against them a chance,” he told AFP.
Hobbs is just one example of a growing problem in the US economy: companies unable to find workers with the right skills to fill open positions, and workers who can’t find a job because they have the wrong skills.
The programme Hobbs attended is in an impoverished area of Philadelphia, the neighbourhood featured in the popular Will Smith sitcom from the 1990s, “The Fresh Prince of Bel-Air”: an area so dangerous his mother sent him to live with wealthy relations in California.
The West Philadelphia Skills Initiative ( WPSI) is unique among employment training programmes. It has a hyperlocal focus, with workers coming only from the area known as University City, and it trains workers for jobs that already exist in the area.
This 2.4 square mile area houses two prestigious universities, research hospitals and numerous businesses. But 31 per cent of residents live below the poverty line.
While Hobbs had a good work history as a young adult, “from the early 90s through 2012 I was an addict,” he told AFP.
Like him, many West Philadelphia residents do not have a solid habit of work. A key challenge is to loosen the “glue” that holds them in place, surrounded as they are by friends and neighbours who don’t work, according to Sheila Ireland, who ran the WPSI programme for many years.
With the US economy creating new jobs at a solid pace of close to 175,000 a month, and with unemployment at 4.1 per cent, lower than it has been in 17 years, companies nationwide complain they cannot fill openings, even for jobs that do not require advanced skills.
The country has over six million unfilled jobs, the most since the government first began collecting data in December 2000, and yet many workers have given up looking and left the workforce, or are working part time because they cannot find a full-time position.
The typical response when workers are hard to find is to raise wages and benefits, but wage growth has been stagnant or tepid at best, just slightly higher than inflation.
Economists disagree on the primary cause of this mismatch between skills and available jobs – and some say companies simply need to raise wages to attract older or discouraged workers back into the labour force.
But new programmes have sprung up to resolve the disconnect.
Traditional unemployment and retraining centres offer courses in things like computer skills, and then send workers out into the market in the hope they will find a job.
But more programmes like WPSI are being developed to give workers the exact skills employers need. Many partner with community colleges to tailor the training to specific fields where openings already exist, such as nursing and health care.
The lack of workers is a drag on the US economy that could get worse.
Economist David Wiczer of the St Louis Federal Reserve Bank said having workers poorly matched to jobs mean lost wages and lost growth that accelerates over time.
Poorly matched workers “are paid less, their pay grows less, and they are more likely to leave,” he told AFP. These mismatches “tend to persist quite a long time,” and over 15 years they are getting paid US$ 120,000 less, which is US$ 120,000 they are not spending in the economy.
Companies historically used inhouse training or apprenticeship programmes to make sure they had workers specifically trained for their jobs. But labour unions traditionally ran those programmes and American unions mehave been in decline for years, leaving workers to find their own training.
“We have to convince industry that there are strategies and methodologies that work, but there are costs,” says Ireland, based on time at WPSI.
Unlike most programmes where anyone can participate, WPSI takes an unusual “magnet school” approach to job training: anyone can apply but only a limited number are accepted for each cohort, or training class.
“It’s just a game changer when it comes to how we recruit,” said Al Santosusso, director of operations for Allied Universal, a security firm and long-time WPSI partner.
Graduates are not guaranteed jobs, but the hire rate has averaged 90 per cent and last year was over 96 per cent. And more importantly the retention rate in the new jobs is 25 per cent higher than traditional training programmes.
After decades on the sidelines, Hobbs now has a job for a local landscaping service, with benefits and a retirement savings plan. “Without God and WPSI, I wouldn’t be where I’m at.”— AFP