Michigan Struggles With Skills Mismatch

State has thousands of job openings in engineering and skilled trades, despite high unemployment.
by | June 12, 2012

Michigan's employment rate ranks 38th in the country. But state officials say if they could fill every one of the more than 88,000 job opening that's available in the Great Lakes State right now, it would rank in the top 15. That's not happening in the imminent future. Why?

"We don't have enough skilled workers to fill our jobs today," says Elliot Forsyth -- COO of the Michigan Economic Development Corporation.

State officials are trying to figure out how address that mismatch in an effort to improve the economy and employment rate of the state, which at one point last year, was ranked 47th in unemployment rate.

So far, they haven't found an easy solution, but Forsyth says fixing the problem "is a science." The state's goal is to ultimately enter the top 10 states measured by employment rate, and to that, it will have to add and fill 128,000 job openings in the next few years.

Forsyth -- speaks at a Governing conference in the state capital of Lansing last week -- says the state has shown early signs of improvement by changing its tax structure as well as the way it offers economic incentives. "A lot of companies that will help us grow are early-stage companies," says Forsyth. Those businesses need  resources today rather than rebates in the future. The state is using a program to provide companies like those with cash grants in exchange for meeting certain growth and hiring metrics. Last fiscal year, those grants totaled  to $100 million. "It's not free money," Forsyth says. "It does have hooks to it."

But Forsyth concedes those incentives will only go so far, and the key to addressing employment is to help develop skills in workers that Michigan employers are demanding. The state is particularly focused on growth in the the fields of energy, information technology, manufacturing, health care and agriculture.

In the first quarter of this year, there were almost 7,000 engineer job openings posted online in Michigan, says Robert Sherer, manufacturing talent director at the Michigan Workforce Development Agency. Yet the number of students graduating with engineering degrees in Michigan has been on the decline for almost a decade.

State officials say that in absolute numbers, Michigan ranks first in the nation in the number of unfilled skilled labor jobs. But the number of apprenticeships for those types of jobs that are crucial for manufacturing, like tool and die makers and welders, is also waning.

Historically, Sherer said, the type of skills mismatch between the labor pool and the job market isn't seen until unemployment is down 5 percent. The current situation -- high levels of unemployment, along with high levels of unfilled jobs -- is unusual.

Sherer attributed the situation to "an inadequate pipeline of youth." He says a growing emphasis on traditional academic skills has caused a decline in technical programs in high schools. Meanwhile, as young Michigan students have spent years hearing about the decline of the manufacturing industry, fewer are likely pursuing paths into that field -- even though there are still an abundance of well-paying jobs in the sector.

Officials say that private industry and the state will have both have to combat negative perceptions about the manufacturing industry.


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