Business, Nonprofit Partnerships Address Skills Gaps

By Kathy Gurchiek Feb 7, 2014
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JPMorgan Chase has launched New Skills at Work, a $250 million, five-year global initiative to close the skills gap by providing training in industries such as health care and advanced manufacturing.

The money will be funneled to best-in-class partners including the National Fund for Workforce Solutions (NFWS), and some of it will then be parceled out to regional collaboratives that offer a 4-to-1 dollar match, some of which is “aligned” funding. Ultimately, the money ends up at grassroots-level partnerships made up of employers in the same industry or sector, according to NFWS Executive Director Fred Dedrick.

Based on employers’ feedback, education and training are provided to job candidates or to existing employees who need certain competencies to advance in their career. JP Morgan cited December 2013 U.S. Bureau of Labor Statistics data that showed one-third of the U.S. unemployment rate is due to workers not having the necessary skills to fill open jobs.

Chicago, for example, reportedly has an unemployment rate of nearly 10 percent despite having more than 100,000 vacancies. The city is earmarked to receive $15 million from JPMorgan and is among major U.S. and European urban areas where New Skills funds will be initially focused.

Chicago Mayor Rahm Emanuel said in a news release that he was confident that New Skills funding would build on the success of an initiative his administration launched in 2011. That program partners faculty and staff at city colleges with more than 100 industry leaders to design curriculum and training and offer internships and jobs in fast-growing fields.

Addressing Job Skill Needs Locally

To solve the skills-gap issue, communities must understand the competencies that businesses are seeking.

“The skills gap is different in every part of the country; it’s a different set of gaps,” depending on the region, industry or occupation, Dedrick pointed out. Partnering with employers provides a “deep understanding of what an industry needs.”

“[It’s] not just a superficial understanding through focus groups,” he said, “but an ongoing relationship where this group of companies is giving training and education providers a clear understanding of what’s going on in their industry right now and the next few years.”

According to Dedrick, career advancement is a “very important part” of the National Fund’s efforts, and the organization works closely with many HR professionals. It has partnerships with 30 U.S. communities and, since 2007, has brought together more than 4,060 employers to establish 151 workforce partnerships.

“The reason we’re very excited about the Chase program is [that] they’re providing us with additional resources … to go out and organize employers and get those relationships established,” Dedrick explained.

The NFWS forms partnerships with regional funders, such as Workforce Innovation in Regional Economic Development (WIRED65). WIRED65 relies on local funders for support and is a workforce initiative of KentuckianaWorks, which serves as Greater Louisville's Workforce Investment Board (WIB). KentuckianaWorks contracts out training to community colleges, industry experts and other organizations to meet the needs of the region’s employers.

“Where we see [skills] gaps, we try to offer training programs,” said Cindy Read, director of sector strategies at WIRED65.

Read works closely with several HR directors to develop training programs and address staffing needs.

“Every [training] project is different, depending on what works in a region,” said Read, who works with four WIBs, a group of local foundations and several employer partnerships. She noted that many of the businesses she works with have critical staffing needs in skilled trades, such as industrial maintenance, machining and welding.

“One of the issues with the entry-level [jobs] is [that employers] want someone with an understanding of quality and safety, who can help with the processes, who has some technical ability. We identify this training. Many times those are short-term training programs so people can get themselves prepared and credentialed to get a better job.”

Those programs could include preparing workers for national certification tests, including the High Performance Manufacturing Production Technician Certification, or handling job placement through the Kentucky Manufacturing Career Center (KMCC), which opened in May 2013. Yamamoto FB Engineering, for one, has hired eight KMCC graduates, Read said.

Two challenges she faces is educating employers about the importance and weight that national certifications carry and getting companies to be clear about the qualifications they want in an employee, especially for entry-level positions. Often, the qualifications listed for those jobs may be more general when, in fact, employers actually want someone with more specific skills. Someone with only a high school diploma or GED may not meet the employer’s required competency level.

Dedrick observed that organizations think their hiring problems are unique, “but 90 percent of the time they’re not.”

“Be on the lookout for opportunities to work with other companies in a partnership to help send clear signals about [your] workforce needs,” he advised HR professionals. “When companies get together in partnership, they’re much more effective in getting the educational system to respond.”

Kathy Gurchiek is the associate editor for HR News.

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