Is Poor Retraining Responsible For High Unemployment?

It’s a difficult concept to grasp — that at a time of massive unemployment, good paying jobs remain unfilled.

And yet despite unemployment in nearly 30 states running 8 percent or higher, nearly 2 million jobs remain vacant because employers can’t find enough qualified workers.

Some high unemployment America faces today is cyclical, meaning that hard times wiped out jobs that will be restored when conditions improve. But many of the job losses this time were structural – we just don’t need them anymore or other countries can do them better or cheaper or both.  So the difference between this economic recovery and those in the past is that this time there is a dramatic mismatch between the kinds of jobs that millions of Americans have historically held and the kinds of jobs that we will generate moving forward.

Traditionally we addressed this problem by advocating worker retraining. Now unexpectedly it is a cornerstone of the Obama administration’s jobs policy. In 2009, the Department of Labor spent a little more than $4 billion on adult workplace training; about one-fifth of that came from the stimulus package. Millions of Americans are undergoing such training every year in an effort for them to go back to work.

And what are workers being retrained to do? It seems that a significant portion of the money is focused on “green jobs” and health-care industry jobs. But the Times article makes clear that current job retraining is inadequate, and hints that it may never really work.

So why doesn’t the training produce its intended results? The Times grabbed the easy answer: “Because there are no jobs.” That might, indeed, be the major reason, but before endorsing it, the Washington Post article offers several other theories:
The shortages aren’t real. When medical organizations speak of shortages, they are measuring current workforce levels against a theoretical number per capita. Just because health professionals say they need more employees doesn’t mean that the market has the capacity to support them.

There’s a personality gap. The unemployed generally have overbearing and unpleasant personalities.  That’s at least a reason offered by actor-comedian-economist Ben Stein, “The people who have been laid off and cannot find work are generally people with poor work habits and poor personalities.” Stein suggests, “that high schools and colleges should have a course on “how to get along” and “how to do a day’s work.” (That might help with future Gen Y joblessness but what about the 7 million unemployed workers 35 years and over.)

There’s a geography gap. Economists have noted that while capital and physical goods are easily moved from stagnant to productive places, people are much less so. In the short term, it’s not easy for unemployed people to move to where jobs might be, especially when many of their mortgages and home values are upside down.

There’s a gender gap. Rationally, any well-paying job should be attractive to any needy worker. But the nation has suffered from a shortage of nurses for decades. Today more young men are willing to enter nursing as a career. But what about out-of-work males in their 40s and 50s who worked in male-dominated industries like manufacturing, construction, IT, and engineering?

Our training is really lousy. Governments and business leaders want unemployment to go down; community colleges want federal grants to provide workplace training; companies want skilled employees; and unemployed workers want jobs that pay well. So what’s the problem?  Maybe – just maybe – we need to stop training skills that businesses past their prime and out-of-work adults want and start training the skills that will produce the growth the economy needs.

And maybe we need to take a serious look at retooling job retraining before we can re-equip unemployed workers with the skills they need to get good paying, stable jobs.

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