Introduction: The Importance of Apprenticeships in Closing the Skills Gap
The focus on apprenticeship is greater today than ever before. From the launch of the American Apprenticeship Initiative in 2016, to the Executive Order issued recently under President Donald J. Trump, apprenticeship has taken center stage as an effective way for companies to develop a pipeline of talent to meet the critical needs of their workforce.
This renewed emphasis presents an unparalleled opportunity to the United States Department of Labor (USDOL), Employers, State Agencies, Workforce Development Boards, Community Colleges, Workforce Intermediaries and other stakeholders to create a model that will meet the demands of industry for qualified labor, close the skills gap, increase student retention/completion, and deliver on the promise of economic prosperity for all.
In response, the California Community Colleges Chancellor Office (CCCCO) made apprenticeship a key priority of its Strong Workforce Program by launching the California Apprenticeship Initiative, New and Innovative Grant Program (CAI). Under the leadership of Van Ton-Quinlivan, Executive Vice Chancellor, Workforce and Digital Futures for the California Community Colleges Chancellor’s Office, the CAI Grant provides funding to incentivize partnerships between employers and the community college to develop apprenticeships for the 10 Key industry sectors of Doing What Matters for Jobs and the Economy.
Through the support of the CAI Program, Jeffrey Forrest of College of the Canyons, along with Tracy DiFilippis of Goodwill Southern California founded the Strong Workforce Apprenticeship Group (SWAG). Since its launch in August 2017, SWAG has registered 10 occupations with the US Department of Labor, and secured partnership agreements with 17 companies to do apprenticeship.
This growth has enabled SWAG to garner statewide and national attention. In March 2018, Jeffrey Forrest, was asked to provide testimony to the House Sub-Committee on Contracting and Workforce regarding how apprenticeships supports small business. What follows is a transcript of that testimony.
SWAG is one of many innovative solutions that demonstrate how the California Community College Chancellors Office partners with industry to address the skills gap, while providing access to employment for stranded workers, Veterans, minorities, and underserved populations.
To learn more, contact Jeffrey Forrest: email@example.com or
Tracy DiFilippis at firstname.lastname@example.org.
The Congressional Testimony Before the House Committee on Small Business: “Workforce Development: Closing the Skills Gap”
Committee Chairman: Congressman Steve Knight, U.S. Representative for California’s 25th Congressional District
On February 26, 2018, the House Committee on Small Business held a field hearing titled: “Workforce Development: Closing the Skills Gap,” which focused on career and technical education programs. This hearing examined apprenticeship initiatives, specifically the Department of Labor Registered Apprenticeship Program, which combines on-the-job learning and related technical instruction.
This article provides a transcript of the testimonies before the Committee by the following witnesses:
- Tammy Simmons, Vice President, Human Resources and Marketing, Machine Specialties, Inc., Whitsett, NC
- Jeffrey Forrest, Vice President, Economic & Workforce Development, College of the Canyons, Santa Clarita, CA
- Jeannine Kunz, Vice President, Tooling U-SME, Cleveland, OH
Thank you and good afternoon, and thanks for having us. I am the small business that you talked about that have been struggling. Machine Specialties is going to celebrate 50 years next year, and we have high-skilled positions in welding, CNC setup machinists. We produce parts that go on the F-35, the F-15, the B-1B bomber, a lot of helicopter parts. We also service the medical industry with hip and knee replacement parts, surgical instrumentations as well as parts on the satellites.
So, our growth is limited to the number of skilled employees that we can have to make those very precise parts that are going to be shot up into space or that are going to fly our aircraft.
For years we have tried to think outside the box and go and recruit more employees. The positions that are the most skilled in our positions are, like he said, are in the baby boomer generation, so what are we going to do now to not only replace the ones that we have that want to retire but also to grow our business and take on new customers?
We first heard about apprenticeships through another business in Charlotte, North Carolina, that had been doing it for 22 years, and they offered a youth apprenticeship model.
And when I attended the meeting, I was a little bit skeptical. We had never recruited youth into our business. We have about 170 employees, and we looked for the most skilled and most talented people that we could find that had years of experience to make these parts.
But because they had been so successful–and they had a really interesting model that by recruiting young talent before they decided to go off maybe and — not sure what they did — you know, we all hear the statistics about how many students go to college but then don’t finish and try to find their way.
They went into high schools and found students that were very interested in building and creating and making things with their hands; that were very successful in the CTE types of programs; and were smart, were good in math.
They had some criteria that spoke to us. They looked for an unweighted GPA of 2.5 because the students in the apprenticeship programs also earn a two-year degree. They look for five absences or less, because as employers, we have to have employees who attend work every day, so we correlated attendance in high school with attendance in the work force.
We looked at the math grades because a lot of the positions that we hold require a lot of thinking, logic, and reasoning. That kind of led to a good successful candidate; and if they were already taking electives in their school. So that, as a business, appealed to me, that you have some criteria that you set up. Also, they talked about being in a consortium of other small businesses and medium-sized businesses or large businesses, but you got some buying power when you did this.
When we went to the school system, it wasn’t just one company, like myself, knocking on the door at the local high school near me saying, “Can I talk to your drafting students who might be interesting in working for me?” We went as a consortium. Our consortium now has 26 companies. We have the superintendent of our school board sitting in on meetings with us because she is very interested in growing and promoting this program.
We had buying power with the school system, so we got a chance to talk to the educators and to the kids in the high school that we wanted to recruit. We also got a little bit of buying power with the community college system.
One of the key attributes to the type of program that we have is that our students go to community college to earn their two-year degree one to two days a week, and then they’re in our facilities the remaining part of the week.
As a business owner, it’s very hard to think that you’re going to have people coming in all day long. By blocking the classes for us, so that maybe they only go to class on Mondays, and having them in our facilities from Tuesday to Friday to earn those on-the-job-training hours, really spoke to me as an employer. I thought that this is something that we could implement and utilize.
When we first started, we had six advanced manufacturers wanting to participate in the program in our first year. We recruited 14 students. It was such a success that our president and our vice president of operations came in to me one Saturday morning and said, “This apprenticeship program is a home run. The kids are learning so fast, much faster, more productive than we ever thought they would be at this early stage, and they’re willing to learn.”
We always talk about this younger generation, the work ethic, and what that’s going to be like, but New America has done a study that shows that apprenticeships have much more loyalty with their employer when they start as a young apprentice. The turnover rate that they quoted is like 90 percent after three years of finishing an apprenticeship, and that’s huge. That’s much stronger than anything I can do when I hire outside the door.
Our company has continued to stay in this. We now have 15, and we’re looking to recruit 25 more apprentices this year. Also, our consortium has grown. We went from six companies the first year to 11 the next year, to 26, and over half of those are small businesses. We’ve also reached across the state on the county lines, and we’ve helped other programs just like us launch, get in touch with their school systems with their community college as the formal education provider and work it.
It’s employer-led. The employers are the customer. They’re the ones that are going to be hiring these students and training them on the job. So, once you have a partnership like that, it kind of spreads the workload around. So, that’s how that that one employer can go out and be part of the consortium, get really good talent into their workforce, have them educated, and kind of share that work burden, and my time is almost running out.
I have so many stories that I could tell you about not only what it has done for our business. That was the first stage. When we got in the first year, like this is great for us. So, then I wanted my other business employers — I am on a manufacturing committee — to know about this, so that was exciting.
But then I also became so engaged with the students. I had students the first day of college say, “I never thought I’d have the opportunity to go to school. I never thought that I would have a career.” Once they received their letter, they said, “I finally feel like I have a direction in my life.” So, then that got me more impassioned trying to help more students get opportunities and in different areas.
Our consortium is now not only advanced manufacturers, but it’s field service technicians, and those are like electricians and HVAC.
Okay, we will go on to Mr. Forrest from the great community college of College of the Canyons.
Thank you, and good afternoon, Chairman Knight, Ranking Member Murphy, and to the distinguished guests who are here with us today. Thank you for this opportunity to provide testimony today on how the Strong Workforce Apprenticeship Group supports small business along with recommendations on how to fund and expand apprenticeship to sustain our growing economy.
College of the Canyons is under the leadership of Chancellor Dr. Dianne G. Van Hook, and we’re committed to working with employers, students, community stakeholders to develop innovative solutions that promote equity, skills attainment, and economic growth in the region.
Recently, the Bureau of Labor Statistics reported that in the month of February, non-foreign payroll increased by $313,000 while the unemployment rate remained at 4.1 percent. While these numbers are encouraging, behind these numbers there looms a crisis, and it is the shortage of skilled labor, and it poses one of the greatest threats to our nation’s ability to sustain its economic growth, and no entity is more impacted by this crisis than our nation’s small businesses. They comprise more than 99.7 percent of all businesses in 2016, and they’re the backbone of the United States economy.
Because of their limited resources, our small businesses are not able to compete with the large companies for talent, and they lack the operational capacity to attract, train, and develop their own workforce. So, what small business needs today is a model of apprenticeship that allows them to 1) Up-skill their workforce, and 2) Be able to implement easily and efficiently.
In response to that need, the Strong Workforce Apprenticeship Group (SWAG) was formed, by myself and Tracy DiFilippis, Apprenticeship Coordinator with Goodwill Southern California.
SWAG helps our small businesses by doing the following. First, we partner with them to recruit, attract, and place individuals into apprenticeship. We also provide instruction to incumbent workers to create a pipeline of talent to fill critical positions. Second, we handle the administrative heavy lifting associated with managing an apprenticeship, making it a more attractive option for small companies.
Bill Boden, General Manager of Repair Tech International says this about SWAG: “We could not imagine doing this alone. The high-level coordination frees our organization to move in new levels of productivity and efficiency.” Third, SWAG provides curriculum that is relevant and up to date through our partnership with Tooling U, a leader in online education in the field of advanced manufacturing.
In addition, we’re working with the National Institute for Metalworking Skills, known as NIMS, to integrate their certifications into our training model. SWAG is currently funded through the California Apprenticeship Initiative. The goal of this program is to incentivize partnerships between community college employers to develop apprenticeship.
I am proud to say that in the seven months that SWAG has been launched, we have acquired more than 50 apprentices, and over 75 percent of them come from under-served communities, veterans, minorities, women, and other under-served population segments.
While we are the fastest growing model of apprenticeship in California currently, what we know is this, without access to a consistent funding stream, SWAG, like the many other initiatives that came before it, would end up in the workforce development graveyard, which leads us to offer the following suggestions on how we can fund and grow apprenticeship to continue to support our small business.
First, we must fix the funding. Tax credits and similar incentives can go a long way in helping small business embrace apprenticeship as part of their employment development strategy. Second, simplify the Workforce Innovation and Opportunity Act.
Ladies and gentlemen of the Subcommittee on Contracting and Workforce, meet WIOA, 399 pages of single-spaced, 10-point font legislation. Hidden somewhere in these pages is funding for registered apprenticeship for on-the-job training. Navigating this legislation is tedious at best. We got to find a way to streamline it.
We need to also look at incorporating some provisions of the PROSPER Act, such as the 25-percent cap on private sector employment from federal work study program, eliminating that along with the provision to access apprenticeship.
We need to strengthen the Department of Labor by personnel funding, upgrades in technology, and helping it in updating its existing work processes so that it could continue to provide the critical services needed by the workforce development community.
We must also look at competency-based education and celebrate and support those educational institutions like College of the Canyons that are working to integrate it into their educational framework and then in working with small businesses, dozens of them.
What we’ve learned is this, effective apprenticeship demands strong partnership. Our workforce development system must come together if we are to remain a competitive force in the global economy.
In conclusion, we wish to thank the members of the Subcommittee on Contracting and Workforce for allowing us to share how SWAG supports small business and your leadership and your commitment in creating prosperity for all Americans, and we look forward to addressing any questions you may have. Thank you.
Thank you. And, all the way from Dearborn, Michigan, Ms. Kunz.
Thank you, Chairman Knight and Ranking Member Murphy and the guests for the opportunity to provide some insight around this important topic of apprenticeships and how small businesses are using apprenticeships to solve the skills gap.
For 85 years, SME has been dedicated to the health and competitiveness of the manufacturing industry. We do that through developing the workforce and promoting advanced technology, and as you’ve heard from the other witnesses here, it is a very significant threat that the skills gap has on the manufacturing industry right now, and we’ve been doing a study for the last five years, and it hasn’t changed, and it’s getting worse, and when we ask manufacturers the question of how difficult it is to find skilled labor, we find that 88 percent are saying I’m having a difficulty finding skilled labor to do the work I have in my organization now, let alone into the future.
When we ask a little more into that research, what is that doing to your business? They’re telling us it’s affecting their productivity, their innovation, quality, safety, profitability. Right? These are all very key things to running businesses here in manufacturing.
So, when we look at that, and we look at the fact that Jeffrey brought up about that 90-some percent of all manufacturing businesses are small, we know that small businesses need to thrive in order for manufacturing to be successful as well. And small businesses, unlike large businesses, have a little bit added challenge, right?
We all know the CEO is wearing the HR hat, is wearing the custodial hat, and the plant manager hat. Small businesses can’t always provide the same kind of benefits and packages that large companies can, so these added challenges really put pressure on the small businesses, I think, as well articulated by Tammy.
So, we look at how do we help those small businesses? We certainly look at something like apprenticeship, and it’s not a one-size-fits-all. We certainly know that. There are lots of things, and I think, Chairman Knight, you talked about the arsenal of tools that are needed to address the skills gap.
But, there’s no doubt that apprenticeships is a key part, and Jeffrey and Tammy did an excellent job, I think, articulating that, and what we’re seeing is the number of retirees and the baby boomers that you referred to that are exiting the manufacturing industry. Those skilled laborers, those journeymen, those apprentices that have all that knowledge.
Unfortunately, manufacturing historically has not done a good job building up that pipeline. It hasn’t done a good job building structured, sustainable programs. It’s a little bit of follow me and watch what I’m doing on the job. Well, that doesn’t work.
We really need a very strong, structured, sustainable program for onboarding and on-the-job training of which apprenticeship programs very much have. SME supports the nationwide Department of Labor apprenticeship programs with a competency-based approach. Right? That’s the change from the past where it was much more time based. It was more about how much time you put into a program.
Now we’re able to look at programs much differently, look at the knowledge and skills that are required to perform in the jobs today, and look towards how people can be assessed towards those knowledge and skills, so we’re more oriented towards a competency-based program versus time, which also reduces the amount of time it takes to get people in the jobs doing effective things that move the organizations forward.
As Jeffrey articulated, we are a good, strong partner here with SWAG, and I think you did an excellent job talking about your program, so it’s not one I will mention here, but I think it was interesting to hear Tammy talk about the consortium.
A couple things that we’re noticing as we get the opportunity to work across the country, so we get to work with the small, the mid, and the large companies, but we are seeing that these organizations and these consortiums are coming together to really help represent multiple small organizations.
One I’d like to mention through our partnership is with a group called MACNY, and it stands for the Manufacturers Association of Central New York, and they basically represent 300 manufacturers, a lot of small to mid-sized manufacturers across central and upstate New York. And when they were talking to those members, like we would expect, those members were struggling with hiring and finding people, finding the right skills.
So MACNY went about how do they go and create these partnerships, these collaborations with the schools, organizations, organizations like SME, where we could look at the knowledge and skills and then start to drive towards what’s needed 80 percent of the way and then help the companies be able to have the flexibility to drive it to their own particular needs.
One interesting thing that MACNY also did was look at a pre-apprenticeship, so it was working with the high schools, dislocated workers, veterans, so again, now that we’re looking at apprenticeships inside these small companies, how do you start to look at again the pipeline of even getting those kinds of people into the system, so a pre-apprenticeship program in the high school.
We have some good where some companies are looking at how to take those pre-apprenticeships into an apprenticeship program, and then we will create a pathway into a college degree program. Many great things are happening in those kinds of examples.
In summary, the health of small businesses is vital to manufacturing success. The largest OEMs in the world are relying on these small businesses, and all too often and not, I can’t even tell you the number of times we hear businesses say that they’re having to turn down orders, delay their expansion of their business because they can’t find the right people. Just things that we don’t want to see continue.
We feel apprenticeships are a proven and needed piece of a company’s workforce development strategy that helps build a pipeline of qualified candidates, grows internal talent, reduces recruiting costs, and improves productivity. We thank the Subcommittee on Contracting and Workforce for taking the time to address this very important and clear issue that we have in front of us as a nation. Thank you.