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JOIN(t) Action Recap: Talking jobs and making connections

Peter Cappelli at the JOIN(t) Action Forum

At the beginning of October, some of the region's largest employers, most innovative nonprofits and most thoughtful advocates gathered together at Drexel's ExCITe Center to talk jobs. How do we create good ones? How do we fill them efficiently? What exactly is a "good job"?

The goal of the JOIN(t) Action Forum, presented by the Job Opportunity Investment Network in partnership with Flying Kite, was to engage and collaborate, while also making sure that participants learned something new about these incredibly complex challenges.

Wharton professor Peter Cappelli, a man who has been working on employment questions for 30 years, opened the program with a talk that undercut many job market myths. (Cappelli also revealed a personal perspective on these issues: "I have an unemployed son," he quipped. "So, I feel your pain on this one.")

Cappelli argues that employers shoulder a lot of the blame for the broken labor market. They get stuck under the weight of certain assumptions -- there is a shortage of skilled laborers, its better to hire from outside the company, training is too expensive, cost-per-hire is the most important metric in on-boarding.

"The cheapest piece of equipment you buy might not add the most value," he explained. "The same goes with employees."  

Employers these days are also obsessed with hiring people with previous experience in the exact same job. This creates a catch-22 for those new to the labor market. Currently, the hardest jobs to fill are laborers, technicians and sales reps -- stuff you can't learn in a classroom. Those positions require on-the-job experience, but no one will offer it without previous commensurate employment. 

Ironically, there is also a growing emphasis on headhunting. Before 1980, 90 percent of jobs were filled internally. Now it's 30 to 40 percent. A lot of human resources departments and training programs were downsized during the recession. 

"Nobody wants to give someone that initial experience," said Cappelli. "A big hospital chain has announced they will no longer hire nurses without experience. This makes sense for one employer, but for everyone it's crazy."

Because of these ingrained attitudes, employers end up being penny-wise, pound-foolish. They don't factor in the cost of high turnover. Often they outsource the recruitment process to companies offering the lowest possible cost-per-hire. Many rely on applicant tracking software that eliminates candidates that would be "good enough" to fill the position. Cappelli shared an anecdote about a company that used applicant tracking software to hire an engineer. They had 25,000 applicants, and none made it through the software's filters.

Of course, a lot of these issues can be solved by hiring internally. According to Cappelli, inside big companies, it takes three years for an outside hire to catch up with the productivity of someone hired internally. Meanwhile, it takes seven years for the person from within to catch up with the salary offered to the outside hire. 

After Cappelli's talk, attendees heard three case studies -- one from a workforce development program (the West Philadelphia Skill Initiative; you can read all about it here), one from a young woman who has accessed these sorts of services, and one from an innovative employer.

That employer was PTR Baler, represented at the forum by Human Resources Manager Brent Ford. PTR has been making industrial equipment in Port Richmond since 1907. They employ a lot of welders, a vocation that requires special certification. Due to a variety of factors, the current average age of a welder in the U.S. is over 50 years old.

So, they needed to find a fresh way to train people. PTR has partnered with other small manufacturers (and unions) and launched a program that works with high schools, creating internships and providing training equipment. The company has also developed an extensive 18-month on-boarding program. Instead lieu of seeking existing experience, they can focus on the intangibles: How excited is the applicant? How motivated? Once you have those things, it's relatively easy to turn an unskilled laborer into a skilled worker. 

Entry-level trainees who succeed in the company's program receive a 50 percent pay increase in the first two years. Even more importantly, they are committed to the employer, creating ultra-low turnover and drastically improving the bottom line for PTR.

PTR Baler was a great example of a company putting Cappelli's ideas into practice -- thinking critically about their needs and fostering great employees. With all this information swirling in their heads, attendees then broke down into small groups to brainstorm. Flying Kite dipped into a few of the conversations, and the emphasis came around again and again to collaboration and partnerships. People often work on these issues in silos -- it's neither as efficient nor as effective as it could be. The break-out sessions provided plenty of fodder for the second forum in the Spring.

"One of our goals with JOIN(t) Action was to engage people around information that was a bit disruptive," says JOIN director Jennie Sparandara. "We wanted to challenge some of our mutually held assumptions of how people connect with work in the region, and the roles employers, educators, funders and government should play in forging those connections. We're very excited about the conversations we sparked and our next steps to turn this engagement into action."

LEE STABERT is managing editor of Flying Kite.

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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