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Is Retraining the Unemployed Actually a Good Idea?

Obama, Romney, and Ryan all endorse retraining for the jobless—but are they right?

| Mon Oct. 15, 2012 6:03 AM EDT

Of the 1,740 dislocated workers we looked at, 1 in 3 needed to take remedial classes before they were allowed to start an academic program, compared with 1 in 5 of their classmates who hadn't lost a job. The main reason? They hadn't been in a classroom for a long time. The average age of the dislocated workers, we found, was 36, more than a dozen years older than the other students on campus at the time.

These differences—in age, readiness for college, sheer desperation for a job—were the reason behind the most unusual, ambitious step that Blackhawk took on behalf of some of the laid-off people who were arriving in droves. With help from Wisconsin's senior senator, Herb Kohl, a Democrat, the college won the $2 million federal earmark from Congress to create a program called Career and Technical Education (CATE) to heap extra help on a small batch of its dislocated workers.

It started in early 2010 with just 125 students, who were divided into two groups. Some were ready for college. The others read, wrote, or did math the way 6th-to-9th-graders should. Each group was steered into just a few kinds of training that, in the judgment of college officials and Borreman's Job Center, were the most promising fields for finding a job. The ready-for-college students had a choice between IT and clinical lab technology. The unready students got more: a semester of extra class time, special tutors, 20 hours on campus each week—"a lot of handholding," Kennedy said. After that, they got 10 weeks of training—enough for a certificate but not a degree—to work as a nursing assistant or welder, or in business.

Such concentrated efforts, Kennedy believes, are what it will take for colleges such as Blackhawk to improve graduation rates. But it's expensive. "I don't know if we ever can bring something like CATE to scale," she said. The possibility seems especially remote now because Blackhawk, like many two-year colleges, is financially distressed. It still has nearly as many students as it did just after the layoffs, and its budget has been shrinking. Last year, Gov. Walker persuaded the Wisconsin legislature to cut the state's share of technical colleges' funding by 30 percent, and to forbid local governments, which contribute a larger share, to increase their tax levies for the colleges. As a result, Blackhawk has eliminated programs in aviation mechanics and supervisory management, and cut nine members of its staff.

"The Best-Trained Unemployed Person in the Area"

Even among the people who got into CATE and others trained in those fields that Janesville's job-training experts think are best, some people still aren't finding work. Graduates in a few areas, such as clinical lab technology and welding, are getting jobs, colleges administrators told me. Not everyone is so fortunate. We compared all the unemployed students—the CATE people and everyone else—who had studied in these promising areas with the unemployed students who had studied something else. Of the people who had trained for the promising fields, slightly less than two-thirds earned some pay in the year that ended last summer, while the rest were not working—exactly the same as proportions as everyone else.

"So much depends on who is hiring and when," Kennedy said. "I don't know how many IT positions were vacant" exactly when the first CATE graduates were ready for a job.

Of the 1,740 dislocated workers we looked at, one in three needed to take remedial classes before they were allowed to start an academic program.

Gauging when a field will ripen can be tricky. Consider Richell McWilliams, 49, a red-haired mother of five who had been making nearly $100,000 a year at General Motors as a journeyman electrician—one of the plant's elite skilled trades. "I'm like the best-trained unemployed person in the area," she told me. As a young woman, she had graduated from Blackhawk with an electronic technology degree. Later, she was an assistant instructor there and taught some apprenticeship classes at the GM plant. When the plant was closing, she qualified for an $80,000 buyout. She accepted a job as a temporary instructor at another technical college, in Madison, where she taught five classes for $5,000 apiece. But a year later, when that job ended, she said, "I was behind everybody else, because if there were a couple jobs out there, those people had gotten them."

As she worried about what to do next, McWilliams read about sustainability and green jobs and the Obama administration's eagerness to create them. "That would be the next thing that would take off," she remembers thinking. "I'll be ready when the jobs come." McWilliams was so motivated that, when she found that no nearby university offered a degree in renewable energy, she pieced together one, taking courses on-line and at several area schools, including Blackhawk. After that, she took short "training modules," to qualify her to go into different kinds of companies and teach environmentally sound practices. As she and I spent an afternoon chatting on her back deck, she showed me a blue plastic ring binder with her renewable energy diploma and all the training certificates she has racked up since she was laid off—37 of them.

McWilliams knows first-hand that green jobs are not arriving as fast as the White House would like. She scours job listings but hasn't found much to apply for. "There is nothing in the area," she says, "that is paying like comparable or even half wages to what I was earning."

She works a day now and then under a grant Blackhawk has, to train local companies in environmentally sound practices. In the meantime, she and her family have been living on the $45,000 a year her husband is paid as maintenance crew leader at the Rock County jail—and about $100,000 in savings they've gone through. "President Obama had indicated there would be all kind of those jobs," McWilliams says, "but I am still waiting on that."

Taking a Shine to SHINE Medical

As dislocated workers such as McWilliams strive to become workers again, perhaps the single thing that makes their struggle most poignant is how hard Janesville has been trying to bring jobs to town. And as the White House and policy specialists elsewhere nudge two-year colleges to step up their game, to work in lockstep with local business to turn out people with skills in demand for the jobs that exist, Blackhawk is a real role model.

A month before the General Motors plant's final day, Rock County's economic development leaders formed a broad alliance called CORD (Collaborative Organizations Responding to Dislocation). Blackhawk was part of it. In March 2009, a month before Mike Vaughn's final day at Lear, CORD brought in representatives of seven agencies each from the federal government and the state for a brainstorming workshop. In July, 2010, Ed Montgomery, at the time the head of the White House Council on Automotive Communities and Workers, traveled to Janesville to talk about rebuilding the local economy. CORD also brought consultants from the University of Michigan's Community Economic Adjustment Program, who have helped dozens of places around the country devise recovery strategies after their economies have been knocked askew. "There have been few examples of community collaboration," the Michigan consultants wrote, "like the one occurring in Rock County as a result of the massive automotive manufacturing dislocations in the city of Janesville."

Long before it became politically fashionable—and economically urgent—Wisconsin has required each of its technical colleges to keep a business advisory committee for each of its academic programs; Blackhawks' advisors meet three or four times a year. Last December, Blackhawk convened a business-education seminar. CEOs and human resource managers from local companies, such as United Alloy Inc., a custom metal fabricator in town, sat with college administrators and instructors for blunt talk about what kind of skills they want when they hire.

Blackhawk's focus reaches beyond companies that already exist. "What's really good in a small town," Kennedy said, "is the economic development people call you and say, 'Sharon, we've got someone who is interested. This is their field, what do you have for them, and can you get back to me in 72 hours?' And we do." Blackhawk has been involved in Janesville's courtship of a manufacturer of medical isotopes, called SHINE Medical Technologies, a startup based in Madison. The planned facility would offer more than 100 jobs but not until 2015 at the earliest, and it faces regulatory hurdles. Still, the college already has developed a proposed curriculum for general education and manufacturing courses and Lakeshore Techical College, in the northeast part of the state, would create a nuclear-science curriculum. After a story appeared in the Janesville Gazette about this possibility, Kennedy said, "Our switchboard was lit up."

Despite Blackhawk's sturdy relationship with local businesses, companies are not always willing to participate. More than a year ago, Blackhawk's president, Tom Eckert, announced a public-private partnership to turn an empty factory in town into a state-of-the art facility to teach advanced manufacturing. The idea fits with a federal program to invest in new manufacturing technologies as a way of improving the country's global competitiveness. The National Science Foundation offers colleges grants for such projects, but they require private investments from local businesses up front. "Tom has been meeting with a bunch of CEOs," Kennedy said. "They are very reluctant to do it. No one wants to go first…We have been talking about this for a year. You get people's expectations up." This summer, Eckert announced that the college would postpone the project and consider whether it might be less expensive at another site.

The Hurdle of the Long Commute

Innovative efforts, in other words, are not the same as results. Rock County became Wisconsin's first to certify empty commercial and industrial buildings as "shovel ready" sites that could attract new employers. So far, the three shovel-ready office parks are largely empty.

In January, St. Mary's Janesville Hospital opened, prompting the single largest hiring burst of the past few years. According to Joan Neeno, a spokewoman for the hospital, 13,000 applications arrived for 350 openings. Some people applied for every job available. Because it is new, Neeno says, "We needed people who could hit the ground running. We couldn't really bring people up to speed and train them as their first job." So of the 350 hires, the human resource director there knows of just three—two in the medical lab and an engineer who became a nurse—who had been laid off and retrained at Blackhawk. Even though the human resource director sits on the college's governing board.

The county's economic development director, James Otterstein, thinks the people coming out of Blackhawk, and others in town who still need work, must consider longer commutes. If jobs are still not coming back in Janesville, signs of economic life, he believes, are stirring within an hour's drive in Madison and in Illinois and Iowa. The Chrysler plant in Belvidere, Illinois, downsizing when Kath left, recently announced it was hiring 1,800 workers to build a new compact car.

"There is nothing in the area," she says, "that is paying like comparable or even half wages to what I was earning."

Jeremy Torpy, an extroverted 40-year-old, thought hard about one of those Chrysler jobs. He had always liked computers. When he started at Blackhawk the fall of 2008—weeks after he lost his GM job of 13 years—he looked at the college's charts of likely salaries in various fields and decided to learn to become an IT network specialist. He studied programming and routers, ports and protocols. Afterwards, he bounced through a couple of jobs, including one giving computer advice by telephone on a customer service line. He disliked it so much he quit. He thought he was going to get hired as an IT network administrator in an organic foods company in northern Wisconsin—a job with health benefits, free bread and milk, and even a masseuse who comes in once a week. His interview was on February 10, 2010—a lucky day, he thought, because February 10, 1997, was his GM anniversary. He thought he had a great interview—but didn't get the job. So he has been working at Woodman's Market, first bagging groceries and now wrapping ground beef and slicing deli meats.

When he heard that Chrysler was hiring, he applied. He took a drug test, drove to Chicago for a physical and got a notice to report at 6 one February morning for new employee orientation. And the more he thought about it, the less sense it all made—driving two hours a day roundtrip to go back into an auto plant, making—when he figured in the gas—not much more than half what he had been paid at GM. At Woodman's, he's gotten a raise, so he makes $13.50 an hour, a little more than than his pay 15 years ago, before General Motors, as an assistant manager at Happy Joe's Pizza and Ice Cream Parlor. But after 15 months at Woodman's, he will get good health insurance. In the meantime, he keeps looking for another job. This summer, he found an IT internship. On his laptop, he keeps careful track of each application, and each job he doesn't get, using the Excel skills that he learned at Blackhawk.

Of Magic and Magicians

When Obama and Romney and Ryan talk of job retraining as a salve for unemployment, they do not mention people like Jeremy Torpy, who hasn't been able to translate what he studied into relevant work. Or Richell McWilliams, who aimed for a kind of job that hasn't yet arrived. Or Mike Vaughn, who has a new job he loves at half his old pay. They do not mention the two-thirds of community college students who never finish. Or that it can take heroic, expensive efforts for a college to help people who arrive on campus grieving lost jobs and shattered lives, panicky to regain their old pay however they can, rusty at writing and math, having no idea how to send an email or use Word.

Across the ideological spectrum, in other words, the politics of job retraining are easier than the reality of job retraining, as I found it in Janesville.

So what then?

At the moment, alongside the political fervor for retraining is a quiet acknowledgement that, at the very least, it must be done better. And that means that the link between two-year colleges and actual jobs must become even tighter. There are competing visions for how to accomplish this. One camp favors programs—the best known of them called Georgia Works—that put unemployed people into real but sometimes-unpaid jobs for a few months while they get trained. The idea is that, once in a workplace, these people are more likely to keep working.

Others, such as a group called Jobs for the Future, urge colleges to employ "real-time intelligence," using data-mining and other technologies to keep track of online job ads—to tailor their training programs continually to the shifting demands of the labor market.The uncomfortable reality is that more tightly targeted training may not be enough. Obama speaks often of a mismatch between the skills that companies need and would-be workers possess. This idea of a "skills gap" holds out the hope that, if unemployed people simply study the right things, they will flow into the workforce. Not everyone agrees. Anthony Carnevale, the director of Georgetown University's Center on Education and the Workforce, says the skills mismatch, while real, is not the whole story. At the moment, he points out, the country has 3 million to 4 million job openings. It has more than 20 million people who could use a job, considering people who are unemployed, holding part-time jobs because that's all they could find, or so discouraged that they've stopped hunting for work.

"Training doesn't create jobs," Carnevale told me. "Jobs create training. And people get that backwards all the time. In the real world, down at the ground level, if there's no demand for magic, there's no demand for magicians."

The last time the United States was enjoying a truly magical economy was at the end of the 1990s, in the final years of the Bill Clinton Administration, when forces converged—briefly—to produce the lowest unemployment rates in a generation (under 4 percent). Readily available money, moderate oil prices, and the rapid commercialization of the Internet fed a broad-based boom. Employers scrambled to find workers, settling, in some cases, for people whom they wouldn't have considered just a few years earlier—and to whom they provided expensive training. In April 2000, 64.7 percent of the American population above the age of 16 was employed, the highest ratio since at least 1948.

The best solution, in other words, is to find the macro-level economic alchemy that will generate jobs—even in places such as Janesville, which has lost so many. And four and a half years after Obama spoke inside the hulking Janesville Assembly Plant (he has never come back to town, since it closed), their competing philosophies for how to restore robust economic growth are a main cleavage point between Democrats and Republicans as the presidential campaigns lean into their final weeks. Obama still speaks optimistically of the economic approach embodied by the stimulus plan he pushed through Congress the winter he took office, weeks after the Janesville Assembly Plant shut down. His opponents put their faith in the free market. "That means get the government out of the way, unleash entrepreneurs," Ryan, Janesville native son, said in a campaign speech in Roanoke, Virginia, in August.

For the moment, neither view has yet altered the world of Sharon Kennedy, who is proud of the work that Blackhawk is doing, but knows how hard it really is. Or the world of Bob Borremans, at the Job Center inside the old K-Mart, whose staff is, nearly four years after so many jobs at General Motors and elsewhere in town went away, still seeing new clients who want government money to go back to school—more often now, people who've run through their unemployment benefits. "We've probably had $9 million to $10 million in training [subsidies] in this county the past couple years," Borremans told me one day. "It's very frustrating, because you find people who took the advice you gave them, and now you are in a situation where I don't know if their life is necessarily better."

And as they tussle over how to create jobs, neither Democrats nor Republicans have an incentive to acknowledge the real possibility that job retraining—neatly as it fits within our cultural beliefs—may not always be able to lead laid-off Americans everywhere back to their old pay. Or back to work at all.

Amy Goldstein is a staff writer on leave from the Washington Post, focusing on Janesville, Wisconsin, as a microcosm of the effects of vanished jobs on people and the places where they live. The Joyce Foundation, Harvard University's Radcliffe Institute for Advanced Study, the Woodrow Wilson International Center for Scholars, the University of Wisconsin-Madison Institute for Research on Poverty, and ProPublica have provided support. She can be reached at goldsteina@washpost.com.

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