STANDING ON THE PRECIPICE

 

STANDING ON THE PRECIPICE

This blog was written using the following resources:

• FF JOURNAL; “Help Wanted, Skills Required” by Meghan Boyer-Editor-In-Chief, February 2012 Edition
• Manhattan Institute for Policy Research; “Leaving Boys Behind: Public High School Graduation Rates” by Jay P. Greene and Marcus A. Winters.
• “Suicide of a Superhero” by Patrick J. Buchanan

Over the last century, one of the strongest sectors of our economy has been  manufacturing.  “Made in America” has been molded into, printed on and adhered to billions of products used in the United States and shipped around the world.  We take a great deal of pride in the products we design and produce.  Manufacturing is making a comeback to American shores for several very good reasons; namely:

• Poor quality abroad. (After the first prototypes are accepted and first piece samples approved, the quality does seem to drop—at least with some companies.)
• Issues with communication
• Misuse of stated and agreed upon standards and specifications (This is becoming a huge issue.  Foreign manufacturers do not seem to understand that changing materials, fastener callouts, paint and coating specifications, etc. can create real problems.)
• Rising labor rates in other countries (Due to Facebook, U-Tube, Twitter, etc.  foreign workers are beginning to understand that they have been greatly short-changed relative to wages. )
• Difficult working conditions for individuals in other countries (Sweat shops!)
• Unrest around the world (If you do not believe this, go buy a tank of gas.  The unrest in the Middle-East is causing speculators to elevate the cost of petroleum. )
• Issues with transportation relative to “lean” manufacturing and inventory control (I retired from GE and I know air freight from China, India, etc. to keep the assembly lines operating can cost a fortune.)
• The effect foreign manufacturing has on national security (When you lose the ability to manufacturer products you lose the ability to control the assemblies you design.  You also relinquish a great deal of intellectual property.  Designers and engineers work very hard to develop products only to give the designs away to thieves waiting in the wings.  )

Fully, eighty-six (86%) percent of Americans believe manufacturing is important or very important to our standard of living BUT, only thirty-three (33%) percent would encourage their children to make manufacturing their profession.  Somewhat of a disconnect but traditionally, a job in manufacturing does not pay as much as other professions.   That fact is changing.

There are two very grave issues that affect manufacturing I would like to discuss at this time.  These are: 1.) Skilled labor available and 2.) High school dropout rates affecting the selection of personnel to fill the jobs available.  Let’s take a look.

• 2.7 million manufacturing workers are 55 years or older and will retire within 5 to 10 years.  These workers are retiring at a rate twice the rate as young people joining the work force.  People with years of experience need to be the “trainers” for those coming into the various skilled jobs.
• Right now, Deloitte, LLC estimates that 600,000 skilled positions are open and not being filled due to the lack of qualified applicants.  When we mean qualified, we mean individuals who have adequate reading, math and English skills.  Communication is an absolute must for high-tech employees—both written and spoken.
• 67% of manufacturing companies have a moderate to severe shortage of qualified workers.
• 56% of those companies expect the condition to worsen in the next three to five years.  As stated, “There is a worsening skills gap in manufacturing and it is impacting the ability of a company to grow, expand and remain competitive”.
• Hispanics are an increasing percentage of the work force.  By 2014, fifteen (15%) of the workforce will be Hispanic.  Between 2004 and 2014, this workforce will increase by 7 million, from 19 million to 26 million individuals.  (US Bureau of Labor Statistics).  As we will see later on, the graduation rates for Hispanics is deplorable.

Now we are going to look at the possible downside creating huge issues with the availability of skilled workers.  Here goes:

•  The national average for graduation rates: 70 %.  Of course, this means we have a dropout rate  approximately 30%  (HORRIBLE)
• Graduation rates for the following:

1. Whites = 78%
2. Asian = 72% (This seems extremely low but the data supports this number.)
3. African-American = 55%
4. Latinos = 53% (With an increasing percentage of Latinos entering the workforce over the next few years, few will be qualified for the skilled labor jobs.)
5. Graduation rates for female workers = 75%.  Graduation for male workers = 65%
6. Graduation rates for African-American girls = 59%. Graduation rates for African-American boys = 48% (Huge gender gap!)
7. Graduation rates for Latino girls= 49%.  Graduation rates for Latino boys = 49%
8. In New York City, the percentage of African-Americans proficient in English = 33%.  For Hispanic = 34%.  For Whites and Asians = 64%.  All of these numbers (including whites) indicate a complete and utter failure on the part of our public school system.

It should be readily apparent that we are losing the Latinos and African-Americans at an alarming rate.  One study indicates that there are several reasons why an adequate education is so difficult to provide if you are an African-American or a Latino:

1. Lack of parental guidance
2. Lure of the drug trade; consequently, no perceived need for training
3. Teachers pass students because they are intimidated by the student and just want to get them out of class
4. Single parent household with no male presence
5. Babies born to unmarried students, thus creating extremely difficult living circumstances

Truly, these conditions could and do exist in Asian and Caucasian families but not to the extent we find them in black and Hispanic households.  It seems to me that one “way out” would be a high school diploma and a college degree.  I think one very important missing ingredient is the will to make a bad situation better AND proper encouragement from peers and adults.   Whatever the solution, skilled jobs needing skilled labor is and will be affected for some time to come.  To some extent, adequate talent is recruited from immigrants coming into our country, but even that has diminished considerably since 911.  The solution remains very elusive.