Corporate America beat back its best job trainers, and now it’s paying a price

Corporate America beat back its best job trainers, and now it’s paying a price

Companies say they can't find skilled workers. Turns out unions are pretty good at providing them.

Four men approached the controls of the bridge deck, taking command of the array of dials and buttons with some hesitance. The lights were dim, with faint ultraviolet rays illuminating white shirts and sneakers; the floor squeaked underneath them.

"Let’s start at say, 8 knots,” said a tinny voice from overhead. The water slowly started moving by outside, under a quiet, barely-clouded sky. “You guys used these before?” asked a tall, bald-headed man in front of the terminals, pointing to their radar. "The course for this channel is 288.”

It felt like a voyage, but it wasn’t: The bridge is perched in the middle of a 70-foot-high bowl on dry land in Linthicum, Md., with projectors casting imagery 360 degrees to simulate conditions on the open ocean. It’s a training session run by the seamen’s union — something that’s become a rarity, as labor’s reach has contracted, even as the need for vocational training has risen.

Minutes pass. “Right 30,” said the self-appointed captain, calmly. “Right 30,” his mates chorused back, shifting direction slightly. The sky darkened, the moon rose. The sun came back up, but clouds gathered. Oil rigs appeared on the horizon, approaching rapidly. “Should I dodge it?” the captain asked the bald-headed man. "Yeah, see what you can do,” he replied.

"Left 30!” the captain, said, more urgently this time. “Left 30!” “Midships!” “Midships!” The seas were getting rougher, and rain pelted down outside. The horizon started rising and falling wildly. Tall icebergs arose on either side. The ship ran into one of them, and flames sprung up from the foredecks. "Little too much, sorry about that,” the tinny voice came back on. "Alright, about time for lunch, gentlemen?" the bald guy asked.

With the exercise over, the lights came back up and the men filed out the back. They’re all members of the International Organization of Masters, Mates, and Pilots, the 5,000 person-strong trade union that crews the U.S. merchant marine fleet. Members come here every year or so to gain new skills and keep certifications up to date.

But there aren't nearly as many of them as there used to be. In part, that’s a function of the dramatic decline in the U.S.-flagged fleet that makes up the union’s employer base, sped along by the disappearance of subsidies and the wartime business for which they’re required.

“We got beat up pretty good, and now we’re struggling for survival,” said Don Marcus, president of the Masters Mates and Pilots. That means the organization is not educating as many of the people who steer ships in and out of U.S. ports — even as the profession overall is projected to expand at a faster than average pace through 2022, mostly on inland routes where the union has lost membership, and the foreign-flagged shipping lines where it never had it.

The union’s predicament illustrates the challenge organized labor in the rest of the country: Although it has historically constructed high-quality educational pipelines to well-paying jobs in cooperation with employers, labor has lost ground over the years. In the absence of union training programs, businesses in vast sectors of the economy are scrambling to meet their workforce needs through other means, like piecemeal job training programs and partnerships with community colleges, with few solutions that have really broad reach.

“What is sorely needed are forums for scaling. And that’s where there’s possibly a really important role for other intermediaries, including labor unions,” said Brookings Institution scholar Mark Muro. “It’s extremely difficult for companies to organize these properly, and obtain these certification systems, and have agreements for what the testing systems are.”

With mounting evidence that a four-year college degree isn’t the best way to prepare everyone for the workforce, and can instead leave students with staggering debt, governments are trying to ramp up career-focused vocational education systems — like apprenticeships, which unions have long provided. But while unions want a voice in that expansion, they’re also worried that spreading the apprenticeship model too quickly could lead to a proliferation of low-quality programs that end up undermining their own.

It’s the curse of popularity: When people realize you’ve created something that works, they’ll try to create their own version. And the imitators may not work as well.

First, a quick history lesson. The declining relevance of unions in workforce development has several causes, other than the decline of the labor movement itself, and it starts in the 1930s.

That’s when, according to University of Washington history professor Dan Jacoby, craft unions — which had an organizing model of limiting the labor supply to highly skilled professionals — gave way to industrial unions, which emphasized size, solidarity and militancy over training as a way to win higher wages and rights on the job.

Then, in the last few decades, college became the key to advancement rather than enrollment in a vocational program. That might have given more people access to higher education, but it also eroded the unions’ role in career development.

“Higher education delivered an assault on workers' control of the skilling process,” said Jacoby. “People are readying themselves on their own dime, creating different loyalties, different notions of solidarity that weaken the labor movement.”

In the 1980s, there was something of a revival. In order to help their employers cope with overseas competition, the United Auto Workers developed joint training programs with the Big Three automakers that helped train workers in new techniques. That system spread to steel, healthcare, hospitality, and aerospace, as one company or a group of companies paid into a common pot of money that could develop a talent pool for the entire industry — solving the collective action problem that exists when one employer fears its investments will be squandered if a newly-trained employee gets poached by a rival.

The cooperative model had several other advantages, unions say. First, it makes better use of a worker’s down time, and allows for flexibility and mobility. That means the training system helps workers throughout their careers, rather than for a one-off certification. "When people are on the bench, because the job market’s bad, they do training, and are able to gear back up,” explained Dan Marschall, a workforce specialist at the AFL-CIO. "And if there are jobs in another market, they can go there."

In addition, supporters argue that giving workers themselves a voice in the process makes for a more effective training program than anything a community college might devise. "There are things that workers know about their jobs that nobody else knows,” said Brad Markell, executive director of the Industrial Union Council at the AFL-CIO.

"There are things that workers know about their jobs that nobody else knows,”

— Brad Markell, executive director of the Industrial Union Council at the AFL-CIO

Union-trained workers cost more, however, since they generally demand higher wages and better benefits. And that hasn’t been worth it for many manufacturing companies, which started to locate in southern right-to-work states, looking to avoid unions altogether.

Over the years, that has shifted costs to workers and the public education system. Companies in general have been spending less on training, as jobs have grown more transitory. Companies don’t see the point in investing in someone who’ll only stick around for a few years, if that, particularly when economic prospects are uncertain. So, at a time when manufacturing requires more sophisticated knowledge, the companies have found themselves without a base of trained workers, leading to complaints about a “skills gap.”

“The decline in union density left a hole, in that there was no way to get employers to work collectively,” said Andy Van Kleunen, chief executive of the National Skills Coalition.

In the absence of those joint labor-management programs, companies and communities have struggled to reinvent other kinds of intermediaries that can funnel people who need jobs into areas of greatest demand. Frequently, these take the form of “sector partnerships,” in which a bunch of companies in an industry cluster get together with school districts and the local government to recruit and train for available positions. There are even tech-enabled matching services, like WorkAmerica, which creates a platform for community college students to connect with employers.

Nobody has figured out the perfect model. And at the moment, unions aren’t very active in some of the most in-demand fields — like lab technicians or software engineers — and aren’t strong enough in some of the places where they’re needed, like right-to-work states. That's partly why business associations have been urging their members to step up and fill the void, taking as much responsibility for their labor supply as they do for other raw materials.
"What has been missing is enough employer involvement to make sure educational institutions are getting it right in the fast-changing world that businesses are all dealing with," says John McKernan, who chairs the U.S. Chamber of Commerce Foundation's Center for Education and Workforce Advisory Board. "And that’s what we can achieve if we move to the supply chain management theory of workforce development."

Until recently, unions had a formal way of participating in the discussion around vocational training: Something called Working for America, a non-profit housed within the AFL-CIO that looked for ways for labor to help. Funding dried up over the past few years, and it’s gone dormant. At the same time, federal legislation that passed in 1998 governing the distribution of job training funds sharply limited the ability of union’s to participate in programs.

“It really shut down labor’s voice in using some of these public moneys,” said Debby King, executive director of the Service Employees International Union’s training and education funds in New York and a handful of other states. “Certainly there’s not been big pressure to say labor should be at the table, and that labor has experience.” (The new version of the law, which goes into effect on July 1, requires slightly higher union representation.)

“Certainly there’s not been big pressure to say labor should be at the table, and that labor has experience.”

— Debby King, director of the SEIU's training and employment funds in New York City

Nevertheless, unions have started piping up to showcase their expertise in training the workforce of the future. Last November, they threw a summit with wonks and top administration officials, talking about new ways -- and old ways -- to match workers with work. They do have some good examples of constructive labor-management partnerships to point to, like SEIU’s training programs in the healthcare industries of several large cities, which educate local residents as well as their own members when grant money is available.

“I do think that as the economy is recovering, and the union movement is realizing that they have something to offer, I think you’re going to see more of them talking as one voice,” says Van Kleunen says.

But in one area — apprenticeships — there’s still a measure of distrust on the part of unions.

Over the past few years, this form of on-the-job training that usually comes with guaranteed employment at the end has been the hottest trend in workforce development. The Department of Labor is putting $100 million into new apprenticeship programs. Presidential candidates as diverse as Marco Rubio and Hillary Clinton want to incentivize more companies to offer them. Even Wal-Mart is working on a program that’s similar to the apprenticeship model, to help funnel entry-level employees into careers (the famously anti-union company has also talked about creating a cross-industry “credentialing” system to improve the quality of the retail workforce, similar to what unions have done in the past).

Unions have facilitated apprenticeships for decades. They essentially came to take over the system in the 1930s, and account for the bulk of the number of registered apprentices in the United States today, which currently stands at 410,000. And in trying to expand the franchise, federal officials have sought to re-brand apprenticeships as a model that doesn’t require union involvement at all.

"I don’t think there’s the intention to leave the unions behind,” said Maria Flynn, senior vice president with the workforce think tank Jobs for the Future. “But I think they’re trying to balance the importance of the historical strength that the unions have had, while also making clear the other opportunities that are out there.”

That makes unions nervous. There already is an incentive for employers to use apprentices in industries like construction, where prevailing wage rates allow apprentices to be paid less than someone who’s fully trained. Sean McGarvey, president of the Building Trades Unions, worries that the White House might end up creating a bubble of low-quality programs that leave people without much to show for their money at the end of the day.

“There are good technical schools, but there’s lots of fly-by-nights out there that are willing to take your money,” McGarvey said. "We’re reserved, because we’re worried. We have a model that works very well, and we don’t want to see it damaged. We don’t want to see every Tom, Dick, and Harry all of a sudden starting a for-profit apprenticeship operation, because we’re not for profit."

"We’re reserved, because we’re worried. We have a model that works very well, and we don’t want to see it damaged.

— Sean McGarvey, President of the Building Trades Unions

Given their druthers, labor leaders would rather more people join unions and have free access to their employer-paid training programs. Like the simulator outside Baltimore, which union seafarers usually visit once a year for programs lasting from a week to two months. This time, 11-year veteran pilot Aaron Golczynski had come back to spend hours on that broken bridge for a course on disaster response, to prepare those situations during his runs on the Alaska Marine Highway that you can never predict.

“It’s two tenths of a mile visibility. There was an island a half mile off, we couldn’t see it,” Golczynski recalled, over lunch at the training center’s cafeteria. “I could hear an outboard motor, driving out there lost, which is the worst thing. So I’m sounding the fog signal, and I could hear him, and he’s coming closer. I blew the whistle, and he veered off at the last minute. He could’ve just easily run into the side of the boat, and it would’ve been bad for everybody.”

Next time, if it does crash into him, Golczynski will know what to do.

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