Transcript Slide 1
National Skills Certification Project Regional Employer Roundtable 1 Human Capital: Manufacturing and Logistics’ Biggest Challenge “While low-skill (-25%) and mid-skill (-18%) jobs declined over last 20 years: “Employment in high-skill manufacturing occupations has risen 37%, an increase of roughly 1.2 million jobs. High skill jobs were the only source of job growth in the U.S. manufacturing sector during this period.” - Federal Reserve Bank of New York 2 80% of manufacturers list ‘finding qualified workers’ as their top concern – NAM employer survey Manufacturing had the largest gap between job openings and new hires in 2009-2010 – showing the challenge of finding skilled applicants. (Wall Street Journal, US Dept of Labor) 3 Even more than the rest of the nation, Indiana falls short in supplying qualified workers The 2010 Manufacturing and Logistics Report Card compares the state of Indiana’s AML industries with those of surrounding states: Human Capital is our lowest grade; Productivity follows Human Capital. 4 • Recently, the Indiana Chamber surveyed 218 Hoosier employers for its Ready Indiana initiative • A strong plurality of respondents (37%) in AML • Key findings were consistent with the Conexus survey response: – Majority (86%) ranked employee skill weaknesses as somewhat/a definite/severe problem for their organizations; 75% increase over 2009 – Applied skills, i.e. communication, problem solving most lacking in employees – Nearly half say most current employees would benefit from additional training – Training is seen as an ‘in-house’ issue, with limited awareness of/preference for industry certifications/credentials 5 Conexus Employer Survey • Conducted February/March 2011 • Conducted by Conexus and Regional WorkOne partners in Southwest, Southeast, Northeast, and Central Indiana • Selective survey approach 6 Who Responded? 134 Indiana employers from the following industry categories: Transportation 12.7% 26.0% Logistics 9.2% Advanced Manufacturing Energy 4.6% 4.0% Aerospace 43.4% Other 7 Size by Revenue and Headcount Annual Revenues Number of Employees $20m-$50m, 21.2% 500+, 36.7% >$50m+, 49.2% $5m-$20m, 18.9% <$5m, 10.6% 0-100, 25.2% 101-250, 19.4% 251-500, 18.7% 8 Employers still hiring unskilled workers and shouldering the in-house training burden What is your minimum educational requirement for entry-level employment? Other No Requirement GED High School Diploma 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% Less than 10% of respondents require more than a high school diploma. 9 High school completion and company-specific assessments valued far above industry credentials Which of the following indicators of work readiness for entry-level employment does your company consider valuable and accurate? Work experience 22% High school diploma 21% GED 17% Company-specific assessment 10% Associates degree 9% Bachelors degree 9% Industry-recognized certification/credential 7% WorkKeys 5% No indicator of work readiness is required 1% Certifications not routinely utilized by respondents as a hiring indicator. 10 So it’s not surprising that employee readiness is considered a problem… Definitely a problem, 6.1% Not a problem, 32.6% Somewhat a problem, 61.4% Somewhat/Definitely a Problem: 68% …as an outdated approach creates issues. 11 Employers agree that a majority of their employees need more training What percentage of your employees would benefit from targeted training for their job? 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Most About half About onefourth Less than 10% 53% say half or most of their employees need additional training 12 Skill Needs are Across the Board But employers show less confidence in industry certifications… Job-specific skills (via on-the-job training) Applied work skills (communication, problem-solving, leadership...) Basic skills (math, reading, writing, language) IT skills (computer basics, advanced applications, telecommunications) Job-specific skills requiring verification/testing - certification Other 25% 23% 20% 14% 12% 6% 13 Some Usage of Industry Certifications Of the 56% of respondents who prefer some certification for certain jobs within their organizations, the AWS, MSSC, APICS and SME are most familiar. Other American Welding Society Manufacturing Skills Standards Council Association for Operations Management (APICS) Society of Manufacturing Engineers National Institute of Metalworking Skills National Career Readiness Certificate 27% 22% 16% 15% 14% 4% 1% 14 The most commonly-used certifications are thought to add significant value… Certified Worker Performance: Association for Operational Management (APICS) National Institure of Metalworking Skills National Career Readiness Certificate American Welding Society (Certified Welder) Society of Manufacturing Engineers Manufacturing Skill Standards Council (Production Technician/Logistics Technician) 0% Good/Outstanding 10% 20% 30% 40% 50% 60% Require Training/Lack Key Skills 70% 80% 90% 15 But there are basic challenges to their adoption: • If you have NOT used any of the certifications mentioned, why not (check all that apply)? – I don’t know enough about these certifications – 36% – These certifications don’t reflect the skills I need – 33% – Not enough applicants have these certifications – 22% • Awareness, availability and relevance all must be addressed 16 A majority would value a more consistent, national system of industry certifications How important would it be to you that certifications were part of a consistent national system with industry-recognized standards? Important/Very Important Neutral Not Important 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 17 Other Skills Seen as Important Please rank the importance to your company of other skills/topics that could be covered as part of a national skills certification system: Inventory/Production Control Regulatory Compliance Safety/Environmental Six Sigma Lean Manufacturing Total Quality Management Very Important/Important Neutral Not Important 18 Indiana AML Companies are optimistic about the future In the next 12-24 months, do you believe the workforce in your organization will: Expand – 57% Expand Stay about the same Not sure Decrease 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 19 Summary of Findings • Employee readiness is a major issue • Companies still not engaged in industry-wide solutions – in-house training still emphasized • Existing training programs/certifications not recognized as leading indicators for hiring – Lack of awareness – Attitude that “certifications do not reflect the skills I need” • However, industry beginning to see the need for a new approach – as skill demands and training costs rise, need a competitive solution • A national system of relevant, consistent credentials would be wellreceived • Certifications must be crafted with ongoing industry feedback and promoted to employers 20 Q&A 21 Breakout Discussions 1. What are the best ways to engage employers in the credentialing process, increasing meaningful input? 2. Can Human Resources procedures be reshaped to emphasize and create a preference for industry-approved credentials? How can this best be accomplished? 3. Has the time come for regional training centers? Should specialized high school courses be designed for technical/vocational training? 22