Jobs expert: ’Skills gap 'is going to be an epidemic'

As advances in technology require a higher level of skill among workers, there is growing concern that this region is at a critical crossroads in its ability to compete for jobs.

“More people are starting to realize now that this is going to be an epidemic,” said Nick Weldy, superintendent and chief executive of the Miami Valley Career Technology Center (MVCTC). “I think we are still on the edge of it where we can make a correction and get enough highly skilled technical employees out there. But it’s got to become a priority for the state.”

As part of its initiative, The Path Forward, the Dayton Daily News is examining what it would take to ensure the region's workforce has the skills demanded by employers now and into the future. We found training programs that are at capacity or have waiting lists, employers struggling to find workers in key industries and wages stagnating even as more people are working in a robust economy.

Among our findings:

The region is in danger of not being able to effectively compete for the jobs of the future. Learn to Earn Dayton, a local nonprofit that strives to improve student achievement, says more than 90 percent of the jobs created since the Great Recession went to workers with some college education. Yet only 36 percent of Montgomery County adults age 25 or older have a college associate's degree or better, according to the U.S. Census Bureau's 2016 five-year estimate.
Ohio is far off its education goals. Just 44 percent of Ohio adults have a two-year or four-year college degree or credential, according to the Lumina Foundation, an Indianapolis-based private foundation focused on post-secondary education. That's well short of the state goal of 65 percent needing to meet that criteria by 2025.
Most well-paying jobs already require more than a high school degree, pointing to a critical shortage of workers for those jobs. Nearly 72 percent of Ohio's 51,220 in-demand occupations paying a median annual wage of $40,000 or more required a credential beyond high school, according to job openings posted at the state's OhioMeansJobs.com website. Officials worry that new businesses won't locate in the state if they can't find the workers they need here.
Some training programs are so swamped with applicants they're forced to turn people away. The Miami Valley Career Technology Center, which does training for adults and at the high school level, had to reject 400 high school juniors for the incoming class because it didn't have seats available. Some programs at Sinclair Community College have wait lists longer than a year.
Employers are struggling to find workers even for jobs that pay well. Ohio will have more than 4,800 openings each year for registered nurses through 2024, according to a state projection. The demand for nurses is increasing as people live longer and need more services. But there aren't enough nursing graduates to fill all the jobs, despite the $63,300 annual median pay for registered nurses.
Pay levels are driven by educational attainment. The median annual pay for Ohioans aged 25 and over who have a bachelor's degree is $21,204 more than someone with a high school degree or equivalent, according to the U.S. Census' 2017 one-year estimate.

To some, the persistent pleas from businesses about their difficulty in finding workers is a clarion call that demands quick and decisive action.

A new report from the Ohio Chamber of Commerce Research Foundation — called Ohio BOLD — uses phrases like “grave concern” in discussing the state’s economic prospects.

Failing to embrace the increasing role of innovation and technology, the report says, will “risk Ohio’s industrial and economic future.”

High-tech workforce

Plenty of people are benefiting from the economic recovery, and unemployment is way down from the dark days of the Great Recession. In the Dayton Metropolitan Statistical area — comprised of Montgomery, Greene and Miami counties — 389,900 people have jobs, according to non-seasonally adjusted July numbers from the U.S. Bureau of Labor Statistics (BLS), with about 18,500 still looking for work.

But wages have stagnated. The median household income in the Dayton metro area declined by 3.8 percent to $52,745 between 2008 and 2017, according to inflation-adjusted data from the U.S. Census Bureau. The decline for Montgomery County alone was 6.9 percent.

Interviews conducted as part of our Path Forward initiative show no one skill set is being sought by employers. It depends on the job.

“Today’s employers want to hire graduates with a broad array of knowledge and skills — not just specific content knowledge, but transferable skills like critical thinking, the ability to solve unscripted problems, and to communicate effectively,” said Lumina President and Chief Executive Jamie Merisotis.

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“Higher education and employers must work together to prepare students for real-world success.”

Historically, many people here have earned a good living with nothing more than a high school diploma. But as the workplace becomes increasingly high-tech, a broader set of skills is required.

For example, the robots that do work once performed by an assembly line worker are operated by someone trained to run the highly technical computerized equipment. The worker doesn’t necessarily need a college degree to operate that robot — many good-paying jobs require a credential, such as a skills certificate or license — but typically more than a high school education is required.

Colleges have had to adapt. Cassie Barlow, chief operating officer at the Southwestern Ohio Council for Higher Education, said post-secondary schools are shifting programs to meet the changing demands from industry for more workers with certificates or associate’s degrees.

“That’s driven by the economy and that’s driven by industry,” said Barlow, a member of the Dayton Daily News’ community advisory board. “In the education field we have to keep our finger on the pulse of what industry needs.”

Not everybody who wants training can get it. College and other job training programs can carry high tuition costs, and taxpayer-funded federal Pell Grants and low-interest loans typically are available only to people with very low-incomes.

Asked what would help fix the problem, Montgomery County Administrator Michael Colbert said, “We would love to see an increase in Pell Grants, and we would like to see it include more individuals who are in the middle-class range.”

Some training and degree programs are also at capacity, meaning applicants are being turned away. Sinclair spokeswoman Deena John said applicants have to wait two to three semesters just to get into the school’s nursing program. The college recently opened a new Health Sciences Center with nursing skills lab, emergency services training room and rehabilitation clinic to “train students in programs that lead to in-demand jobs in the health sciences field,” John said.

Sinclair and the University of Dayton have also proposed a partnership with Premier Health that would allow students to get a bachelor's degree in nursing by attending both schools and doing clinical rotations at Premier and Kettering Health Network facilities and at Dayton Children's Hospital.

Weldy said some of the capacity problem at Miami Valley CTC will be relieved through an expansion currently in the design stage. Voters approved a bond issue last year to improve capacity and technology at the Clayton campus.

Miami Valley CTC serves 2,500 high school students and 5,000 adults annually. Weldy knows that demand will only increase.

“Our business partners are out there saying we need all the students you can give us,” he said.

Preparing today’s students

Preparation for future jobs begins long before a student hits college, trade school or even high school.

Learn to Earn Dayton sees a close connection between getting kids ready for kindergarten and preparing them for the workforce of tomorrow.

Getting a broader pool of children ready to learn from the moment they enter kindergarten is the aim of Preschool Promise, a nonprofit funded by Dayton city income taxes, Montgomery County, Kettering and private donors.

“(It’s) really providing that foundation so that they’re ready to learn and can carry those skills throughout their education years,” said Cathy Petersen, director of communications for Montgomery County.

Under a three-year-old state mandate, elementary school classrooms must incorporate career awareness programming into their curriculum, said Shannon Cox, associate superintendent of the Montgomery County Educational Service Center.

Credit: DaytonDailyNews

The county-wide service center develops and distributes materials to elementary schools about careers expected to be in demand when students enter the workforce. Depending on the school, students in later grades can choose among workforce-sector course offerings in aerospace, information technology or basic career planning.

High school students can also get a jump on college through the College Credit Plus Program, allowing students to attend classes free at public colleges and universities and apply those credits toward their degree.

“Just even a brush with college correlates with better income potential,” said Dan Krane, professor of biological sciences at Wright State University and chairman of the Ohio Faculty Council for the state’s public four-year universities. “The people who go to college get a benefit from having been to college, but it doesn’t stop there. There are huge societal benefits for individuals attending colleges.”

Career tech centers: ‘We’ve switched our message’

Ohio has long had vocational high schools — now known as career technology centers — but those programs have ramped up to meet changing industry needs.

Many career tech students walk straight into a job when they graduate.

Miami Valley CTC serves 27 high schools in the region, while smaller career tech centers are operated by Dayton, Mad River and a partnership of Kettering, Oakwood and Centerville schools.

Sinclair is the region’s largest workforce development provider, training 12,746 adults last year and awarding 4,169 degrees or certificates. In the school’s incumbent worker training program, companies pay Sinclair to assess and train their existing workforce.

“We are not building in hope that they will come,” Shannon Bryant, Sinclair’s vice president for workforce development, said of the school’s many programs. “We’re building it because (businesses) are telling us they need it today as well as they are telling us they will need it tomorrow.”

Officials say the career tech centers, along with Sinclair and other workforce development programs, are key to helping get the region prepared for the jobs here now as well as those that are coming.

“To blindly say a four-year college is for every student now is an antiquated notion,” said Liz Jensen, career tech principal at Kettering Fairmont High School, noting that Kettering’s career tech program is also at capacity. “We’ve switched our message to ‘post-secondary training for all’ and that comes in many flavors, depending on which career you choose.”

Demand for high-paying jobs increases

One of ironies of the current economy is that some employers are having trouble finding workers even for jobs that pay well.

Registered nurse is the second most common job in the Dayton MSA and has the best pay of the 10 most common occupations, according to the BLS.

“Hospitals now are hiring nothing but 4-year degree nurses,” said Bryan Bucklew, president and chief executive of the Greater Dayton Area Hospital Association.

“The demand is going to increase, primarily because people are living longer, medical technology is getting better and people are using more services.”

Four of the 10 employers with the most job ads in the 12-county Dayton region are area hospitals, according to OhioMeansJobs.com data for June, the most recent compiled data available. Kettering Medical Center tops the list. There are about 650 jobs listed this week on Kettering’s website and Premier Health has about 530 job openings posted on its website.

Trucking is another industry with a labor shortage problem.

Nationally, the industry will be about 60,000 drivers short of what it needs this year, though a full-time driver can make $45,000 to $80,000 annually, said Kevin Burch, president of Jet Express of Dayton.

Truckers need a commercial driver’s license and “there’s a line of recruiters at every truck driver school,” said Courtney Carlisle, human resources director at I Supply Co.

The industry has a dual problem: an aging workforce and a challenge to recruit young people to a career that seems undesirable to many.

Burch said trucking companies have had to delay freight shipments or pick up the cost to hire an expedited shipping firm when they don’t have enough drivers. To attract younger workers to a job that can put someone on the road for days, companies are experimenting with alternative scheduling and many are boosting pay.

“Because of the driver shortage, companies are giving drivers two to three raises this year alone,” said Burch, who recently finished a stint as chairman of the American Trucking Associations. “It is blowing the budget of companies.”

‘It will create a stronger workforce’

The Ohio Chamber’s BOLD report calls for the state to focus on next-generation manufacturing, future health, smart infrastructure and data analytics as part of its path for the future.

Next-generation manufacturing is a catch-all category that includes advanced materials, industrial machinery, precision industrial components and aircraft/aerospace. Workers in these fields will need “large increases in the level of technical skills,” the report says.

Other growth areas mentioned in the report include the biomedical field, health care delivery, energy and logistics. The chamber recommends funding four state-wide innovation hubs by shifting existing revenues from the state’s Ohio Third Frontier bond program, federal workforce funding, private capital investment and liquor proceeds controlled by the state’s privatized economic development arm, JobsOhio.

Funding is frequently mentioned by training advocates as critical to better preparing the region’s workforce, but no one expects to discover a windfall of money. In fact, some programs have had to deal with a cut in workforce development funding.

Montgomery County trains dislocated workers, low-income youth and adults through a program that is partially funded through the federal Workforce Innovation and Opportunity Act. But because the federal money was cut by 28 percent between fiscal year 2016 and this year, the county has been dipping into its general fund to meet the demand.

This year the county added $1 million to the $2.3 million it received in federal dollars.

Officials say the program is vital, providing everything from job-readiness workshops and supportive services to occupational skills training. Under Project Hire, the county gives companies up to $8,000 to subsidize an employee’s salary during a six-month training period.

“We don’t give them corporate welfare,” Colbert emphasized. “They have to agree to hire.”

Petersen said the county trained 835 adults through the program in the past three years. Another 1,576 slots for youth were also funded.

“The primary industry sectors we focus our efforts on are manufacturing, logistics and transportation, health care, (and) information technology because these sectors’ credentials lead to self-sufficiency,” Petersen said.

Christina Buchanan, 50, of Germantown got set up in a new career through the program.

The county money helped Buchanan return to school after the medical billing business where she had worked for 27 years was shut down by its new owners.

She earned an associate’s degree from American National College in Kettering as a certified surgical technologist, and now has a job using that skill at Dayton Children’s Hospital.

“It was a new lease on my life,” said Buchanan, who graduated in May. “I got an associate’s degree and got a job within two weeks of graduation. It’s not something that I would have been able to achieve if not for the program.”

Montgomery County Commissioner Debbie Lieberman, a member of the board that oversees Workforce Innovation and Opportunity Act money for 43 counties, said the county’s training efforts are part of a broader plan aimed at helping the region grow economically and to be ready for the jobs of the future.

“Government can’t solve all of these issues,” she said. “We need help from the employers and we need help from the individuals.”

She added: “It will create a stronger workforce. That’s the goal of all of this.”

Ohio occupations with the most projected annual openings through 2024

Job	Total projected annual openings	Median hourly wage - May 2017
Combined food preparation and service workers, including fast food*	6,920	$9.21
Retail salespersons*	6,002	$10.67
Registered nurses	4,833	$30.43
Cashiers*	4,960	$9.31
Home health aides*	4,476	$10.33
Nursing assistants	2,711	$12.54
Office clerks, general	2,495	$14.88
Customer service representatives	2,474	$15.50
Licensed practical and licensed vocational nurses	1,930	$20.21
General and operations managers	1,904	$44.77
Maintenance and repair workers, general	1,638	$18.87
Truck drivers, heavy and tractor-trailer	1,597	$20.09
Team assemblers	1,479	$15.50
Accountants and auditors	1,438	$31.02
Front-line supervisors/managers of food preparation and serving workers	1,325	$14.93
Farmers, ranchers and agricultural managers	1,293	$35.11
Front-line supervisors and managers of retail sales workers	1,274	$17.60
Sales representatives, wholesale and manufacturing, except technical and scientific products	1,202	$27.59
Machinists	1,150	$20.20

*These jobs are not defined by the state as "in-demand" because they do not offer a "family-sustaining wage," which the state defines as 80 percent of the state's $17.55 per hour median wage.

Source: Ohio Department of Job and Family Services, U.S. Bureau of Labor Services

Today’s story is the first of two parts. See our story on which solutions to the skills gap are working.

By the numbers

90: Percentage of jobs created since the Great Recession that went to workers with some college education.

36: Percentage of Montgomery County adults age 25 or older who have a college associate's degree or better.

4,833: Number of openings for registered nurses projected by the state each year through 2024.

$63,300: Annual median pay for registered nurses.

$2.3M: Amount of money Montgomery County received this year from the federal Workforce Innovation and Opportunity Act, which funds training for dislocated workers, low-income youth and adults. The total represents a 28 percent decline from 2016.

Sources: Learn to Earn Dayton, U.S. Census Bureau, State of Ohio, Montgomery County

About The Path Forward

We have formed a team to dig into the most pressing issues facing the Miami Valley. Today’s story, on the so-called skills gap, is a problem local officials say could seriously hamper the region’s ability to compete for jobs today and into the future. For past stories from The Path Forward team, go to DaytonDailyNews.com/Path Forward.

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