Time to wake up

Arkansas Business, Feb 25, 2008 by Jeff Hankins

DEPRESSING. ALARMING. SCARY. And I'm not talking about gasoline prices or the way financial institutions and the Federal Reserve Board led us into the miserable housing and credit situation.

The message from the University of Arkansas at Little Rock Regionalism Conference regarding the impending retirement of baby boomers was this: There will be plenty of jobs but not enough educated workers to fill them.

We first heard the mantra in the late 1990s when it became clear the country didn't have enough labor in the technology sector. The bursting of the tech bubble eliminated jobs and scared students away; then all the talk of outsourcing jobs to India spread even more fear about the tech sector. Now it appears that even India's supply of educated workers eventually won't be enough, nor will those workers remain a cost-effective alternative for U.S. companies.

Wal-Mart Stores Inc. said last week was that it is ready to hire "hundreds" of IT workers. The good news is this will result in an influx of people into northwest Arkansas. The bad news is that Arkansas couldn't fulfill those needs if every technology-degree graduate in the state joined Wal-Mart in May.

The impending jobs crisis, as outlined by author Edward E. Gordon, reaches beyond technology into health care, education and manufacturing. Gordon observes that people who have worked in manufacturing for years and haven't sought additional job skills training will become "the walking dead" in the economy.

Gov. Mike Beebe, in his remarks at the conference, confirmed what I feared and what I suggested in a column in September 2005:

"Leaders in West Memphis and Marion know they have an ideal site with a centralized location, attractive infrastructure elements and a competitive financial incentives package available from the state. At the same time, they express some concern about the state's ability to coordinate and fund efforts for work force training in the region, and they are clearly frustrated....

"Glen Fenter, president of Mid-South Community College in West Memphis, describes a situation where if we don't meet the needs of Hino, we'll face an uphill battle landing Toyota. Alternatively, if we impress Hino, then that would assist recruitment efforts."

During the first days of operation, Hino experienced a 40 to 50 percent employee turnover rate and an unacceptable rate of faulty products. A coordinated training effort was put into place last year, Beebe said, and in December the turnover rate was just 1 percent.

So the talk about environmental issues being the major factor in Toyota's decision not to put a plant in Marion was the smokescreen we suspected. Toyota couldn't risk Hino's work force experience.

The Beebe administration and higher education moving in the right direction, but it's an uphill climb to transform an antiquated educational system and culture that enabled us to win the Cold War but won't meet the demands of the 21st century.

I'm reminded of a dinner conversation before a college commencement ceremony about 10 years ago. We debated whether a university's role should be providing a quality liberal arts education or preparing students for the work force. The professors at the table essentially said universities shouldn't have an economic-development or job-training mission. I said the expectation of a college student is that he is being educated and prepared for a good-paying job. The disconnect was clear.

Today, this issue shouldn't even be hazy or debated. College professors must recognize that building a smart work force is their job. Every college degree must have a career entry strategy.

The debt being incurred by Arkansas students has tripled during the past decade. We can't allow students to graduate with $25,000 in student loans and not be able to immediately get a good-paying job. Nor can we watch students go to college for a couple of years, not obtain a degree and find themselves with $15,000 in debt and nothing to show for it because they spent the first year of college taking remedial math and English classes.

When Beebe and his new director of higher education, Jim Purcell, talk about accountability for the colleges and universities and doing a better job of connecting business and education, these are the issues at stake. Business leaders will have to step up and help drive change.

E-mail Jeff Hankins at jhankins@ abpg.com.