ARCHIVED  August 1, 1997

Round table on the labor shortage

Leaders agree: Welfare reform, school to career critical

Editor’s note: Editors from The Northern Colorado Business Report and The Boulder County Business Report invited several Front Range business leaders for a round-table discussion in June on the labor shortage problem and possible solutions.
Joining Northern Colorado editor Christopher Wood and staff reporter Helen Taylor, and Boulder County editor Jerry W. Lewis and managing editor Dana Coffield were: John Hunt, president and chief executive officer, Economic Development Association of Longmont; Gayle Mahler, director, School to Careers Partnership, Front Range Community College; Roland Mower, president, Fort Collins Economic Development Corp.; Toya Speckman, director, Workforce Boulder County; and Kenneth Zelie, president and chief executive officer, Norwest Bank Boulder.
The following discussion was edited to highlight major points from the hour-long regional round table.BUSINESS REPORT: John, you came from a region that had been economically depressed and then experienced rapid growth and change. How did you assist companies to find workers during that industry diversification in West Virginia?

JOHN HUNT: The area I came from had been almost like a single-crop type situation, where you had the coal industry. And, of course, our situation there was to diversify the area and get into more value-added type businesses.
The unemployment rate had been staggering, way up in double digits. We set out to diversify the area, with the colleges and schools, employment-training people, to bring down the unemployment rate. The first thing I did when I went there was to really do a labor study.
This area, of course, is totally different. We (in Boulder County) have a higher mix of technology companies, medical technology, information technology and a lot of companies who need highly skilled and highly technical labor. You do have the situation where a lot of companies can use mechanization to take the place of a lot of labor. On the other hand, there is a lot of entry-level labor here where you find the real problems.
Everyone is working together to try to really look at the welfare situation and see how that can be used to really help offset entry-level labor problems.
I also think companies today realize they have to work smarter, given the globalization of everything. They are using the Internet more – even to go after labor in Europe and Asia. You’ll find that in Germany, unemployment is 10 percent or more, and there are a lot of good qualified technical people in Germany that could be utilized. The unemployment rate in Mexico is double-digit as well. So you can get into a lot of situations where you can share labor, and also have some things produced offshore, with higher tech and added value to stay here in this area.
BR: How does the labor shortage fit into the decision-making equation of companies considering relocating here?
HUNT: As I said, we really have to do a good labor study here that really points out where we are, where we have been and what we can do to offset the situation. And I might say, there still is an in-migration of people coming to this area. There also are people that are underemployed and could be better utilized in full-time positions, and there also are people that could be employed in more than one job. So it’s a matter of really getting a real good handle on the labor situation we have.
BR: What would a labor study entail?
HUNT: What skill levels are needed, but also what level the participation rate is at in the labor force – a lot of housewives, for instance don’t work; they could work. More college graduates could stay here, and so could high-school students. So we need to look at all of those resources.
BR: Would you just look at Longmont?
HUNT: No, I want to do it regionally. You just can’t just look at Longmont, Boulder, Fort Collins or Greeley. We have to look regionally. We all need to think regionally, just like you are today.
BR: Ken, you’re working on a labor study with the Boulder Economic Council. What are some of the general conclusions your group has reached so far?
KENNETH ZELIE: We’re trying to get our arms around the work force, what their needs are going to be, relative specifically to affordable housing, transportation. Also we’re going to talk about some telecommuting issues.
We will survey both employers and employees. We’re working with Rich Wobbekind at CU’s Business Research Division. It’s going to be fairly exhaustive.
HUNT: Roland, are you doing something like this up in Fort Collins?
ROLAND MOWER: We’re not. I think the emphasis that we’re looking at is more to identify what are the employment opportunities in the community, particularly the ones that have careers associated with it. And trying to identify those from the employers and then provide training to get people into those tracks. We’re clearly moving in the direction of saying “What do you need to grow here?” and “Let us help you shape that.” But I think looking at the region makes a lot of sense.
BR: Is there the potential to make up the labor gap with welfare reform?
TOYA SPECKMAN: We’re certainly hoping so, and we’re excited about a new study because one of problems and tasks have been really knowing what direction our supply-side clients need to go into. So if we get more direction from the demand side, or employers, we’re going to help those people. We have to help the employers along with our clients who need training. We just do Boulder County, and we’re seeing 10,000 job-seekers a year in our offices besides the welfare clients, low-income clients and dislocated workers.
MOWER: It’s interesting that industry can tell you what they need today or a year out. But not when you start about five years out. It’s also interesting to a certain degree that the business community has this expectation that K-12 will prepare kids for jobs that they don’t even know what they’re going to be. So that’s a pretty tough chore for K-12; so we’ve got to get a little bit better at that.
GAYLE MAHLER: And also for the colleges. Someone needs probably two years for an associate degree to get the technical skill, but if they need a four-year degree, can we know if there will be job for them when they graduate?
SPECKMAN: We’re looking at short-term certificate courses for our welfare clients. I want to get input from our employers: If we do this, if this is how we design the program, are we going to meet your needs?
BR: Some employers nationally are saying they’re not hopeful that people leaving welfare can fill their jobs, particularly in technical areas. Toya, in your forums with local employers, what has been their response?
SPECKMAN: They are very hopeful, because they do need the work force. But what I heard from them is not necessarily the particular job skills they want. They want us to work with clients on what I call workplace success skills. So we’re teaming with Front Range to work on communication skills, critical thinking, how they work in teams. The client can take a certificate to the employer and say, look, I have these skills, and the employer is going to take less of a risk.
BR: How reliable of a resource will the welfare rolls be to help solve the labor shortage?
SPECKMAN: With the partnerships in private sector, I think we’ll be able to help meet the demand, but I don’t think it is a cure for everything. We need a lot of help with lots of internships – to be volunteer positions in the workplace. So they are learning not only a job skill, but they will be prepared to learn what to put on a resume, and learn how to get their child ready for day care and get to work on time. So we’re also asking for mentorships, support to understand some of the problems they’re going through.
BR: What role will the schools-to-career program play in easing the labor shortage?
MAHLER: It’s a partnership piece that you mentioned that is so important. We need separate initiatives. Brighton is different from Westminster. As we look at what can happen between the Front Range College and also CU-Boulder, CSU and UNC, we also need the opportunity for our students to get out and see what some of those working opportunities are. We talk about the K-12 students needing to get out because some of them have never set foot in a workplace or in a job. We need school to career to look at how can we help students see some of those skills in action. But also for the college, I think we all probably know families where someone’s gone ahead and gotten the bachelor’s degree, but are back home with mom and dad because they don’t have any job skills.
BR: Are you looking for exposure to more potential careers?
MAHLER: We are looking at that at the K-16 partnership level that school to career covers. One of the important things to take a look at is if we just depend on teachers to let students know what their future looks like, well, a lot of teachers went to elementary school, high school, college and then got a job in school. And several of them don’t have the experience or at least the current experience of going out to a business and seeing what’s that’s about. One of the pieces of school to career that every partnership is looking at is how can we get our teachers out to a business. There is something the state is looking at that they call Partner Up, which is to pair one teacher with one businessperson.
ZELIE: Maybe it’s nothing more than a teacher asking the simple question of why am I teaching this or what is the application of subject matter?
MAHLER: And to have a businessperson come into classroom and say this is why it’s important that you learn this because I use this equation every day in my business.
SPECKMAN: It’s adding a fourth R – relevance.
HUNT: Another important issue is child care. There are a lot of people, especially single parents, who have to have a place for a child to go to.
SPECKMAN: One of the problems we’re seeing as we talk to employers is the shift work – that’s where most of their entry-level work is. It’s very hard to ask a single parent to work third shift, first of all because there is very little day care for nontraditional child care. Second of all, when will they see their child?
HUNT: And that’s going to have an impact on child-care centers. There will be a need to expand those.
SPECKMAN: There are several early-childhood education programs for training people to work with children. One of the issues is that those are often lower-paying jobs also.
BR: Norwest is very involved in school to career programs. What role should industry have in ensuring that high schools, colleges and trade schools are doing their job?
ZELIE: School to careers is one of the programs that Norwest adopted as one of its major initiatives across the state. Going back to Gayle’s comment, and people going on to college, spending $40,000, $50,000 or maybe $60,000 on education and then coming out and not knowing what you want to do. There’s nothing wrong in the school-to-career process of going out and experiencing a lot of nos. I don’t want to be a doctor, I don’t want to be a lawyer, I don’t want to work at Safeway. There’s is nothing wrong with experiencing nos. What you do is you increase the probability of perhaps of finding out what you do want to do.
BR: But how do you get beyond those who say in school to career all you’re doing is tracking people to become welders?
SPECKMAN: In Boulder County, we like to say K through adult, and that’s one reason Workforce Boulder County got involved with school to careers because our clients needed the business connection as much as, if not more, than grade school and high-school kids.
MAHLER: We’re not just asking schools to change, but how can businesses become more user-friendly partners. For instance, Norwest has taken it to heart the expectation that it will be involved in the community. For some businesses, that would be a change. With the idea that we will give our employees three hours a month or whatever to get involved with their children’s school or some other educational group.
BR: Roland, how much of an impact in Fort Collins is your organization seeing from the labor shortage?
ROLAND: Our employers also are finding it difficult to find the skill sets that they want. And I guess the worst thing that can come out of that is that when they choose to expand, they choose to expand somewhere else rather than our community. Our primary concern is that we are going to have a work force that will allow the companies that are in Fort Collins to stay there and expand. We have a very strong manufacturing community in Larimer County, and we want to maintain that percentage of jobs as a percentage of our overall economy.
BR: Are companies having to move?
ROLAND: Well, we have one employer talking about having to drive to Cheyenne to bus down employees, and that’s a pretty serious discussion. But unemployment along the Northern Front Range is no different than a lot of other parts of the country, and that’s pretty well-documented. Companies are kind of stuck, in that the places they would like to go are probably experiencing the same situation they’ve got here, so why move? It all comes back to how do we fill their needs?
There is also a group of manufacturers in Fort Collins who are really delving into this “lean” enterprise and manufacturing process. Effectively, it’s the Toyota model – and being able to do more with less. They are being prompted to move in those directions and become more efficient because of the labor shortage.
ZELIE: We’re finding ourselves spending a lot more time as a result of the labor situation on internal training programs. Give me somebody with basic skills, and then we’ll bring them in and grow them ourselves. A lot of businesses are doing that to much more of a degree than they have in the past.
BR: Is the shortage entry-level or skilled labor?
MOWER: I’m hearing it’s more on the entry level.
HUNT: I would agree that it’s more of that. But there are a lot of consolidations going on in the business world today with acquisitions and what have you. I think we need to do a better job when a company shuts down somewhere else in the state or wherever, of bringing those people who are losing their jobs into this area. I think that’s how we can work better together. Because we are going to have dislocations.
SPECKMAN: In our Broomfield office, where we partner with Adams County and Jefferson County, we saw more than 500 dislocated workers there this last program year. It ranged from anywhere from very high tech Ph.D.s that were dislocated to much lower skills.
MAHLER: Another nice piece in our community and work-force development group is that we can go to a business if you need certain training for a certain group of people to help them get their skill level up, we can go do that.
ZELIE: I’m just amazed to look within our own company and the positions we post for mid-level managers and the difficulty we have filling those positions.
If you look at the Denver Post want ads, I cannot believe the number of ads that are in there.
BR: What do you think the salary range is for those mid-level jobs?
ZELIE: I’ll speak from my banking perspective, they are $40,000 to $80,000.
BR: If a company does close down and we bring those employees here, one question is where are they going to live?
MOWER: Let me give you an example. When we heard about National Semiconductor closing down its manufacturing, we made calls to HR people saying we know you have job openings, so can we start sending you resumes.
In that case, housing wasn’t an issue because the workers are already here.
BR: But as we try to attract entry- and mid-level workers, can they realistically afford to buy a house here?
SPECKMAN: I know that the welfare roles have dropped down in Boulder County to 815, after an all-time high of 1,400, and there are several reasons. One is that some people knew welfare reform was coming and decided to get off it, and I would like to think we did a great job in job-training program.
Of course, part of it is the economy, and part of it is affordable housing in Boulder County.
HUNT: But that’s also why people commute from everywhere. They come in from Fort Lupton, Brighton, from Weld County, wherever. There’s more affordable housing out there.
MOWER: You know, we’re kind of spoiled. I was in Southern California, where executives drove up 405 at 8 in the morning and spend two and a half hours each way, each day. Affordable housing is an issue for our respective communities, whether it’s Boulder or Fort Collins. Yet there are still smaller communities where there are still housing opportunities. But I do think even those are disappearing. People are going out to Eaton, Severance, Frederick.
BR: How did we get into this fix of a severe labor shortage?
ZELIE: The very strong economic expansion in the past six and a half or seven years is lowering the unemployment rate. It’s a great position to be in, but there’s always going to be challenges. That’s what we’re looking at now, challenges relevant to the labor force. But this, too, will be cyclical.
MOWER: Some are actually saying that things are going to get worse because the average age of a Colorado resident mirrors that of the baby-boom generation. We are going to have significant labor shortages from now on without some sort of in-migration. But I still see in the short term a lessening of the strain.
BR: Are high schools doing enough?
GAYLE: I’m looking at the Boulder Valley School District and looking at what that school district is interested in vs. working with Longmont and in Fort Collins and some of the other areas. For example, in Loveland, school to careers is very strong. And in Longmont, there is very strong community feeling in that group. And they will make it go because it’s their children and it’s their future. Colorado doesn’t call it school to work, even though that’s a federal initiative. They did a survey and focus groups, and work was not a good word, and so we call it school to career.
MOWER: In Fort Collins, 48 percent of the population has bachelor’s degrees. Is school to career much more difficult to implement there or Boulder vs. an area where there is a lower level of college graduates?
MAHLER: Where a lot of the general public has bachelor’s degree or higher, a lot of those people have been successful, and we don’t realize that just what works for us may not necessarily work for our children. There are so many unknowns. Do you know what your kids are going to experience 10 years from now in terms of the job market?
MOWER: When you think about it, business doesn’t have one vote at the school-district level. The only vote they have is with their feet. If they don’t like curriculum, they actually could move from one jurisdiction to another. But they don’t get to vote the school board in, which decides what the curriculum will look like.
SPECKMAN: I want to play off of that. Because in the Boulder Valley, the business community is really, really behind school to careers, and there’s a lot of parents really behind school to careers.
ZELIE: Public education is an issue – getting the word out that there is this program called school to careers.
MAHLER: It’s starting to change, but there will be some backlash. There are some groups who see school to career as evil. They see it as tracking everyone to get a job when you’re 18.
However, Front Range started a program with Midas, where we’re doing training for technicians. Midas can’t find people to do that work, but they also look at it as this is the first job with this organization. They say we’re not talking about this being a career, but if a student goes through the training and starts working at a Midas shop, they will reimburse the tuition. So here’s someone who can go and get some training, which isn’t going to be their end career, but it will be a good start to get them through college.

Leaders agree: Welfare reform, school to career critical

Editor’s note: Editors from The Northern Colorado Business Report and The Boulder County Business Report invited several Front Range business leaders for a round-table discussion in June on the labor shortage problem and possible solutions.
Joining Northern Colorado editor Christopher Wood and staff reporter Helen Taylor, and Boulder County editor Jerry W. Lewis and managing editor Dana Coffield were: John Hunt, president and chief executive officer, Economic Development Association of Longmont; Gayle Mahler, director, School to Careers Partnership, Front Range Community College; Roland Mower, president, Fort Collins Economic Development Corp.; Toya Speckman, director,…

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