Transcript Slide 1

National Skills Certification Project
Regional Employer Roundtable
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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
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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)
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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.
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• 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
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Conexus Employer Survey
• Conducted February/March 2011
• Conducted by Conexus and Regional WorkOne partners in
Southwest, Southeast, Northeast, and Central Indiana
• Selective survey approach
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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
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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%
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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.
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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.
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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.
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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
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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%
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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%
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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%
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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
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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%
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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
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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%
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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
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Q&A
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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?
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