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Columbia Business Monthly

Working the Workforce

Jun 29, 2017 02:32PM ● Published by Emily Stevenson

By John Jeter

First, the good news: South Carolina is booming. The unemployment rate is running at 4.3 percent and the state GDP grew 2.1 percent last year according to the U.S. Department of Commerce. Now the bad news: South Carolina is booming. With the state Department of Commerce reporting 98,000 new jobs and $27 billion in capital investment since 2011, pressure is building on the Palmetto State’s workforce.

“South Carolina is facing staggering workforce challenges brought about by an ever-increasing demand for high-skilled workers, an aging workforce fast approaching retirement, and unprecedented economic development growth,” writes Susan Pretulak, vice president of economic development and workforce competitiveness at SC Technical College System.

Mikee Johnson echoes her assessment, which appeared the South Carolina Chamber of Commerce 2017 Workforce & Jobs Report.

“The trade skills gap has become an abyss,” says Johnson, chair of the State Workforce Development Board since then-Gov. Nikki Haley’s appointment six years ago. “It is staggering. We have job opportunities waiting in line for skilled workers.”

Johnson, chairman and CEO of Cox Industries, says he has trouble himself finding workers to add to the 400 employees who manufacture and distribute pressure-treated wood at his family-run company in Orangeburg.

“It’s getting scary. It’s scary for economic development, and it’s scary for companies like ours,” he says. “I don’t even think it’s a wage thing. You can always pay more. We’re at a dearth for bodies that haven’t taken on enough education programs.”

He applauds House Bill 4145, which created the Workforce Coordinating Council to help untangle some of the duplicative efforts in the labor-development bureaucracy. He points out, for instance, that the Department of Employment and Workforce gets its funds from the federal government, while the state’s Commerce Department is state-financed.

Interestingly, the General Assembly passed 4145 in June 2016, the same month that Maher & Maher, a New Jersey-based consultant, released an exhaustive study for DEW, Commerce, the state’s Department of Education, and SC Technical College System.

The 128-page “South Carolina Talent Pipeline Project” identified several “strategic sectors” in South Carolina’s four regions, highlighting job deficiencies in business and information technology; healthcare; logistics and transportation; and construction—collectively expected to grow 15 percent by 2025. 

“Many positive influences and initiatives are being brought to bear on the talent development issue, and all need to be tied together for maximum impact,” the study says. “The state therefore needs to take a prominent, planned, and productive role in helping regions connect the dots and implement sector strategies in support of overall talent pipeline development.”

To that, Chamber president and CEO Ted Pitts says, “We’re going to have a shortage of four-year degrees, a shortage of engineers and health care-related people. We need to make sure we don’t lose focus there.”

Nevertheless, Pitts sees improving alignment among the public and private sectors.

He points to the Michelin Technical Scholars Program, which pays tuition, fees, and books for students in mechatronics and mechanical and electronics engineering who also work part-time for the global tire giant—similar to BMW’s expanding apprenticeship program.

Rob Gross, spokesman for Boeing, whose 7,500-plus employees in the Charleston area make it one of the state’s largest employers, says South Carolina’s workforce is what attracted the Seattle-based aerospace behemoth here in the first place.

“We recognized that workforce training and development would be a key early priority as we stood up operations in a region that was new to commercial airplane manufacturing,” he says.

Boeing has invested nearly $19 million in education in South Carolina, with more than 42,000 students visiting the DreamLiner plant and an additional 271,000 students engaged through its DreamLearners speakers bureau, he says.

“Companies are making the investment and doing it on their own,” Pitts says, “but where we would all agree is that taxpayer investment and workforce development need to be efficient and need to be aligned with the needs of the jobs in our state.”

Cheryl Stanton, DEW’s executive director, cites the agency’s initiatives to provide opportunities for such constituencies as ex-offenders, military veterans, and the homeless. “We are aware that employers need workers now,” she says. “We are going beyond the traditional approach of supplying one worker for one job, to creating a pipeline of workers. Much like the way businesses develop a supply chain, we want to develop a supply chain for workforce.”

Those efforts haven’t gone unnoticed. South Carolina ranked No. 4—behind Texas, Florida, and North Carolina—in Chief Executive magazine’s April 2017 “CEOs Rank 2017 Best & Worst States for Business,” scoring 6.75 out of 10 in “workforce quality.”

“The business community is not sitting back and waiting for the public sector to solve their problems,” Pitts says. “The private sector is fully engaged.”

Robert Ployhart, chair of the management department and professor of business administration at the Darla Moore School of Business, still sees cautiousness there.

“There’s still some skittishness since the recession in how much you want to invest in people,” he says, and with the unemployment rate so low and the economy’s cyclical nature adding uncertainty, “We’re not going to sink a lot of money into our overall population. We don’t know what the economy is going to do, we don’t know if we’re heading into another recession.”

At the same time, “I think as a state we’ve done a pretty good job,” he says of the state’s business recruitment. “But again, those efforts are being driven more by state government to make us more attractive as a state for employers than what you see among employers themselves.”

As the Maher & Maher report says: “Unified, strong leadership from the state—and influence from the private sector—is essential to ensure that this momentum is maintained. As state level and private sector leadership is expressed, so will leadership continue to emerge at the critical regional level.”

As Pitts writes in the Chamber publication: “There’s no silver bullet to address the workforce issues that South Carolina companies face. The solution lies in a multifaceted approach and requires commitment and collaboration from everyone.”
Economic Development, Enterprise

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