Why local businesses can't fill high-paying job openings, and how it impacts the community

Centre County is experiencing a skilled labor deficit, and that deficit is affecting local business, wages, building schedules and more.

"What I've seen, in my time here, there has never been a more significant shortage of skilled workforce, skilled technicians," said Todd Taylor, vice president of postsecondary education at Central Pennsylvania Institute of Science and Technology.

And it's a national problem.

According to the U.S. Bureau of Labor Statistics, there were 6.6 million job openings at the end of March. The Associated General Contractors of America reports that 70 percent of the nation's construction companies are struggling to fill open positions with qualified employees.

Projected annual job openings in transportation-related fields through 2022 are 68 percent larger than the number of students training to work them, according to the U.S. Department of Education's Office of Career, Technical and Adult Education.

The shortage of skilled workers in the region is stunting Goodco Mechanical Inc.'s growth, says owner Scott Good.

Goodco, a commercial and residential mechanical contractor based in State College, is "shy" qualified people across the board — from service technicians and plumbers to residential installers, he said.

He said he thinks that skilled tradespeople are retiring faster than they can be replaced, and specifically in Centre County. Combine that with Penn State pulling the interest of most of the kids graduating from high schools in the area and the "college only mentality," and it's the recipe for the reduction in the skilled workforce.

So the company has to grow its own people — directly from high school or from CPI and Penn College, where there's a background but very little work experience, so there's a learning curve, Good said.

But even the number of students that those technical schools are producing isn't enough to offset the difference in the amount of people getting out of the workforce to be able to keep up with the workload being generated by the economy, he said.

Good said the company — which has 60 total employees, 40 of whom are tradespeople — could expand its workforce by 25 or 30 percent, but there aren't enough qualified people to fill those jobs. Goodco is actually having to turn down work, and not only because it doesn't have sufficient manpower, but also some of the subcontractors it works with aren't able to staff projects either.

Andrew King, a diesel technology instructor at CPI, said he gets phone calls and emails weekly from different employers looking for trained technicians and mechanics.

Of the 19 "guys" in his 1,100-hour diploma program, 17 already have jobs, he said.

"Honestly, there's still more jobs out there that I don't have guys for so it's a good problem to have," King said.

For them, at least.

It's almost a "desperation" from companies, Taylor said.

For every one of CPI's graduates, Taylor said, there are 10 companies calling in or postings for openings.

And that competition is driving wages up.

The only way to get qualified people is to pay them a lot more, Good said, adding that his company has seen a "drastic increase" in what it's paying people in the past year or two. But, he said that isn't a bad thing because for a long time, pay in the trades hasn't gone up as much as it should have.

Those wage increases are going to have an impact on the economy as prices for commercial construction jobs go up, Good said, and homeowners will have to pay more for qualified HVAC servicers and plumbers and electricians.

Beyond competitive wages driving up prices, lack of skilled employees is going to make it more difficult to get projects built on time, Good said.

He continued: "We're having trouble making schedules and meeting schedules just because all of the trades are having trouble manning the projects properly."

Leaders in the area are trying to fix the problem.

CPI partnered with Cleveland Brothers — a Pennsylvania-based Caterpillar dealer — and Ariel Corp. to create a two-year (associate in specialized technology) natural gas compression degree program. They wrote the curriculum together, got it approved by the Pa. Department of Education and the companies send their trainers and technicians in and even sponsor students with scholarships, Taylor said.

If businesses are providing equipment and diagnostics and sponsoring scholarships, they're doing it because they need people over the long term, he said. CPI has a similar partnership program with CASE Construction Equipment.

Centre County's congressman, U.S. Rep. Glenn Thompson, R-Howard Township, is an advocate for career and technical education. He co-authored the Strengthening Career and Technical Education for the 21st Century Act, which unanimously passed the U.S. House in June and is waiting to be taken up in the U.S. Senate.

He said the bill will "provide better access to more effective skills-based education" and give authority back to state and local leaders who have a thorough understanding of the regional workforce needs.

The Chamber of Business and Industry in Centre County, in talking to more than 60 companies in the county, realized that businesses are having trouble finding employees with appropriate skill sets. Jennifer Myers, CBICC vice president of economic development, said 44 percent of businesses said technical skills were lacking in the workplace and 36 percent said "soft skills," like customer service, were lacking.

CBICC, in collaboration with education leaders, is launching the CentreREADY initiative to address the workforce concerns of local employers, starting with soft skills, Myers said.

And finally, advocates for career and technical education say that parents and kids should be encouraged to consider trade or technical schools as alternatives to bachelor's degrees.

"I'm a college grad myself, so I try not to get too down on college, but the issue really is that there's a lot of people who should not go to college — and just because they either don’t have the aptitude or the desire to be there, but they go there because they think that's what they need to do to get a good paying job and that's not the case anymore," Good said.

These jobs are high-paying, Taylor said. With three years of experience, someone working in the natural gas compression field could be making more than $100,000 a year.

For a lot of kids, college is the perfect fit, Good said. But it's not the perfect fit for everyone.

In 2017, 74 percent of State College Area High School's 542 graduates went on to a four-year college, while four percent attended trade and technical schools, according to district spokesman Chris Rosenblum.

Lane Brown, 19, was one of those who went on to CPI. He's in the 1,100-hour diploma program in diesel mechanics.

"School wasn't really my strong suit," Brown said, adding that rather than spend four years in college, he wanted to get training out of the way in one year, move onto a job and get to work.

This story was originally published May 26, 2018 at 10:30 AM with the headline "Why local businesses can't fill high-paying job openings, and how it impacts the community."