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Q&A: Wharton Professor Peter Cappelli talks jobs

Peter Cappelli is the George W. Taylor Professor of Management at The Wharton School and Director of Wharton’s Center for Human Resources. He recently published Why Good People Can’t Get Jobs, a book that lays many of the country's human capital challenges at the foot of employers. Next week, Cappelli will give a talk at the JOIN(t) Action Forum, a gathering of thought leaders, advocates and employers workshopping best practices for creating and filling jobs in Philadelphia. Flying Kite caught up with Cappelli over email to discuss his perspective on human capital.

Flying Kite: You have made some waves by shifting some of the blame from job applicants -- and the systems and institutions that prepare them for the workforce -- to employers. What made you tune into this side of the equation?
Peter Cappelli: I don't think this is an issue of advocacy. I just saw that what was being claimed, more by the consultants than by employers per se, was not true and didn't even fit with what HR people were saying.

Are you also making a moral argument? Do companies have an obligation to employ people in their communities? Does increased training, new hiring models and higher wages also work on a purely economic level? Will companies that follow this prescription do better business?
I don't feel qualified in this context to make moral arguments. I think the case for paying attention to investments in employees is a practical one. It works for the employers.  The reasons they are not doing so are not good ones. They are not based on any evidence.

Can you speak directly to Philadelphia's human capital issues? What are the best tools at the city's disposal in an era of cash-strapped schools in seemingly perpetual crisis?
The funding issue is a political problem. I suppose gathering more employer involvement in the outcomes of schools might help with that, although it would also be necessary to convince the political leaders on the business side that the problems were not simply caused by the schools themselves or by their unions.

You write about the basic accounting flaws inside many companies -- that it is much easier for them to quantify the cost of hiring someone than the cost of NOT hiring someone. What can be done to change this?
Yes, I think this is the heart of the problem. It has to do with information, getting data on the value of employee performance and the costs of poor performance. There are lots of reasons why this doesn't happen -- it's surprising because you see it when employers buy anything else. HR people haven't had the resources, but they also haven't had the inclination or perhaps the ability to try something new, which might mean challenging the way the CFO has been tracking operations.

I experienced this classic paradox myself when I was looking for a waitressing job in college -- you can't get hired if you have no experience, and you can't get experience if you're never hired. Can training programs bridge that gap? Or is it really about employer flexibility?
Fundamentally this problem is caused by an employer's rule of thumb. It is certainly true that experienced people are better bets to get up to speed quickly, but they also cost more and are more likely to be set in their ways. Entire industries like consulting and accounting thrive by figuring out how to make use of kids right out of college. In large part, this is a failure of imagination on the part of many employers, to figure out how to train cheaply, or at least to figure out what the options are.

I recently spoke with the director of the West Philadelphia Skills Initiative about their job pipelines. They start with the jobs (through partner companies and organizations) and then do the training. They also focus heavily on "soft skills." Is this one possible solution?
Sure, it's a solution for employers who are persuaded that they cannot train. But the bigger issue is why so many employers are now persuaded that they can't train.

The Job Opportunity Investment Network (JOIN) has partnered with Flying Kite to explore how good jobs are created and filled in Greater Philadelphia.

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