Could the manufacturing "skills gap" actually be a "wage gap"...?

Posted by LDonia on 11/20/2012

Is the manufactuing “skills gap” we’ve been hearing so much about really more of a wage gap?

That’s the idea set forth by Adam Davidson in a piece for the New York Times.

Davidson visited Queensborough Community College in New York City to sit in on a class that trains students for high-tech careers in sectors that include manufacturing.

The writer expresses surprise at the fact that really the students are learning how to use and program computers to do the type of work people did a decade or two ago. Davidson writes:

(The) intro class starts with the basics of how to use cutting tools to shape a raw piece of metal. Then the real work begins: students learn to write the computer code that tells a machine how to do it much faster…Running these machines requires a basic understanding of metallurgy, physics, chemistry, pneumatics, electrical wiring and computer code. It also requires a worker with the ability to figure out what’s going on when the machine isn’t working properly. And aspiring workers often need to spend a considerable amount of time and money taking classes.

Community colleges and vocational trainings across the country teach classes like this one and, as the Alliance for American Manufacturing (AAM) has reported, these classes are often popular and filled to capacity.

This raises the question…if these classes are filling so quickly that schools need to add new sections and courses, why do we still hear about the jobs going unfilled due to a lack of skilled workforce?

The starting wage for these jobs may have something to do with it.

Davidson interviews the C.E.O. of a company called GenMet. The reporter writes:

At GenMet, the starting pay is $10 an hour. Those with an associate degree can make $15, which can rise to $18 an hour after several years of good performance. From what I understand, a new shift manager at a nearby McDonald’s can earn around $14 an hour…The secret behind this skills gap is that it’s not a skills gap at all. I spoke to several other factory managers who also confessed that they had a hard time recruiting in-demand workers for $10-an-hour jobs. 'It’s hard not to break out laughing,' says Mark Price, a labor economist at the Keystone Research Center, referring to manufacturers complaining about the shortage of skilled workers. 'If there’s a skill shortage, there has to be rises in wages,” he says. “It’s basic economics.' After all, according to supply and demand, a shortage of workers with valuable skills should push wages up.

Davidson points to data from Boston Consulting Group, which suggests that, the skilled workers manufacturers are looking for have decided to work in other sectors. And, as a result of the poor starting wages, many students won’t spend time in programs that don’t prepare them for even semi-lucrative jobs. This may become a bigger problem as more people retire from the manufacturing jobs they’ve filled for most of their lives.

Read more here.

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