Any professional association will tell you access to talent is the biggest challenge facing Utah’s industrial businesses. But our current skilled labor shortage is not a temporary phenomenon. It's a product of a gradual breakdown in the mutual commitment between industrial employers and blue-collar employees. Luckily, the very Utah businesses most affected by the skilled labor shortage hold the power to solve it.
Long gone is the era of an employee accepting a career-long position with a single employer. Since the 1980s, as global competition increased, businesses lowered costs by offshoring production and investing in process improvements and automation. These strategies yielded returns for corporations, but resulted in the loss of industrial jobs to other countries or into the ether.
As industrial workers left the workforce or transitioned to white-collar careers, the golden age of American industry tarnished. The power of our blue-collar role-models was replaced by the scars of big layoffs and the roar of the for-profit education marketing engine, promising white-collar jobs for all. Private sector labor unions receded, offering fewer protections for job seekers. A national obsession with contract and temporary workers further eroded workforce development and pushed more risk onto workers. Laborers in every sector now take home a historically small share of national income.
Employers are also finding themselves stuck between a rock and a hard place. Not enough workers are emerging from training programs with the skills employers need. In 2016, job tenures dropped to 4.2 years — with 25-to-34-year-olds demonstrating a third of the average tenure of their 55-to-64-year-old peers. Industrial employers now see few incentives to invest in training employees since it seems they leave at a higher frequency than ever before.
What has emerged is an inefficient game of labor market chicken with neither side willing to make the necessary investments in the other. The result is the “skilled labor shortage” or “skills gap,” where employers are desperately searching within a constrained pool of talent for employees with the exact skills they need, and employees are reluctant to “train-up” for the high-skilled, high-paying positions open and available.
The solution to this stalemate lies with both government and business. Our state government has committed itself to initiatives to bolster quality technical colleges and outreach programs to K-12 students. Talent Ready Utah, a program launched by Gov. Gary Herbert this year to support educational programs that feed into high-growth industries, is also a move in the right direction.
It is time now for businesses to step up and play their part in healing this broken relationship, if they want to attract the talent they need to survive. Employers can modernize their work environments, emphasizing retention-oriented paths to ongoing career development. Businesses can become self-aware of their unique cultures, engaging their best employees to understand their needs and the common values they share. This “self-knowledge” can then be used to improve hiring practices and attract workers that truly belong at the organization and are likely to stay. Once employers become confident in their ability to hire effectively, they will naturally invest more in the types of training programs that are so badly needed.
For Utah’s rapidly growing population to thrive, we need to develop workplaces that will draw our citizens to the work we need them to do. Employers have the power to restore the symbiosis that once catapulted millions of Americans into the middle class — they just need to understand that attracting, training and retaining good employees is central to everyone’s business model.
Adam Himoff is the president/CEO of Xemplar Skilled Workforce Solutions, an industrial skilled workforce recruiting firm based in Salt Lake City.