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The difficult challenge of matching jobs and job seekers

Policy Wonk
Rochester Business Journal
October 25, 2013

Nothing is more debilitating than unemployment, for both the individual and society. The jobless are deprived of the dignity of work, and the community is deprived of the benefit of their labor. We look to workforce development programs and higher education to match jobs and job seekers and, often, to help the unemployed gain the skills needed in the workplace.
Recent attention has focused on "middle skills," those positions requiring some postsecondary technical education and training but not a four-year college degree. A December 2012 Harvard Business Review article-"Who Can Fix the 'Middle-Skills' Gap?" by Thomas Kochan, David Finegold and Paul Osterman-found that nearly half of new job openings from 2010 through 2020 will be middle-skills positions in fields such as computer technology, nursing and high-skill manufacturing. Community colleges are particularly well suited to addressing the middle-skills gap and are exploring how they can best fill that need.
Survey of firms: Monroe Community College's Economic Development and Innovative Workforce Services division engaged the Center for Governmental Research to support its effort to survey the workforce skill needs of the businesses in the MCC service territory. The Rochester Business Journal joined the partnership, providing feedback on survey design and access to the list of individuals who have registered to receive the RBJ Daily Report or other e-newsletters.
The 338 firms that responded to the survey represented about 86,000 workers. Manufacturers made up the largest share of respondents, nearly a third of the total.
Skills gap: We were particularly interested in learning more about the "skills gap"-the notion that some positions are persistently vacant because the workforce lacks the skills for them. Survey respondents reported 740 persistently unfilled positions. In a rough extrapolation across the entire Finger Lakes economy, we estimate that the total would be about 23,000 in a range of occupations, just under 5 percent of total occupied positions. "Production" occupations were the plurality, with machinists mentioned far more frequently than any other single occupation. Consistent with the national middle-skills discussion, 61 percent of the unfilled positions are considered middle skills, most requiring "long-term on-the-job training."
Another common theme in the survey is the lack of "basic employability" skills such as a good work ethic and coming to work on time. This kind of non-specific training may fill the "skills gap" that exists for those positions considered low-skill or semi-skill, particularly many of the customer service and sales positions mentioned by respondents.
What's next? MCC is using the results of the survey to determine how to focus its resources. The need for long-term on-the-job training suggests that customized training for individual sectors-such as tooling and machining or optics-should continue and possibly be expanded. The issue of basic employability reinforces the role of programs that bring young people into the workforce-summer jobs programs, the Hillside Work-Scholarship Connection, internships and co-ops.
We're going back to our survey pool to learn more, such as: Are firms with unfilled positions searching outside the area? Are the missing skills available at a higher price? A revised survey will be rolled out in the next few weeks.
The curious case of GlobalFoundries: The experience of Hudson Valley Community College suggests that addressing the skills gap might not be as easy as it appears. Michael N'dolo, an economist at Camoin Associates in Saratoga Springs, documents the challenges confronting HVCC's efforts to prepare the workforce for the expansion of nanotechnology in the Hudson Valley.
A two-year degree in electrical technology from HVCC nearly guarantees access to jobs at GlobalFoundries, Tokyo Electronics and other firms in the SUNY College of Nanoscale Science and Engineering universe. As N'dolo observes: "Typical starting salaries were $35,000 to $45,000 with opportunities for advancement well beyond that range with a year or two of adequate on-the-job performance. The cost of tuition in the program is $3,980 per year plus some additional fees and book costs, and HVCC offers need-based scholarships that could pay for a portion of that cost. That is a very small investment compared to the boost in earnings available post-graduation! Assuming the alternative is a $10- or $12-per-hour job (i.e., $20,000 to $24,000 annual salary) without a degree, the payback is extremely quick and lifetime earnings are likely doubled or tripled."
Despite the nearly certain payoff, HVCC has had difficulty filling classes. Moreover, about half of students enrolling drop out before getting the degree. And GlobalFoundries has been forced to import skilled workers from outside the Capital District to meet its needs.
Back to high school? N'dolo speculates that the HVCC coursework may demand more mathematical competence than high school graduates bring to the workforce. Which brings us back to the recent statewide test scores: Less than a third of students in grades 3 to 8 statewide met the new math standard. Only 29 percent of Albany County's eighth-graders and 9 percent of Albany city's eighth-graders-surely a big part of HVCC's pool of future candidates-met the standard. The average for Monroe County was slightly higher than Albany County's at 31 percent. The average masks a vast disparity, however. Although 68 percent of Pittsford eighth-graders passed and 49 percent passed in West Irondequoit, less than 4 percent performed at this level in Rochester schools.
The economy has raised the bar. State Education Commissioner John King has faced a firestorm of protest over the new Common Core curriculum standards. He recently canceled a series of forums on the subject after protesters disrupted the first one (but he has rescheduled since). It isn't fair to blame the commissioner or the Board of Regents, however. As the GlobalFoundries examples suggests, it is the global economy that has raised the bar for student achievement. The skills gap starts in prekindergarten.

Kent Gardner is chief economist and chief research officer of the Center for Governmental Research Inc.

10/25/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email

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