It would seem to be a good problem for a state to have: Employers seeking people to fill thousands of open jobs, and thousands of unemployed or underemployed people want to be working.
But what if it’s not as simple plugging job-seekers into open positions? What if the jobs aren’t located where the available workers are? Or what if those wanting employment don’t have the skills required to be hired for those open jobs?
The commonwealth has both problems: Kentuckians who live in areas where there are few available jobs, and people across the state who want to work but lack the training needed by many employers in today’s high-tech world.
It’s a problem that hurts individuals and businesses as well as the state’s economy. People want to provide for themselves and their families yet still can’t find work. Employers can’t fill available jobs much less grow their businesses because it’s so hard to hire the talent they need. And the commonwealth loses millions of dollars in potential tax revenues while paying for services to help individuals struggling with unemployment and poverty.
KET explored these problems in Filling Kentucky Jobs, a program that detailed these workforce challenges as well as state and local efforts to prepare Kentuckians to enter the labor market.
Why Aren’t More Kentuckians Working?
At issue is something called the workforce participation rate, which is calculated by dividing the number of people actively engaged in the labor force by the number of adults who are eligible to work but are not employed.
Kentucky’s workforce participation rate was 57.6 percent in 2016, according to the state Chamber of Commerce. That was the fourth lowest rate in the nation. The rate had been on a slow decline since 2000, but the drop has accelerated since 2008.
“We started hearing about the shortage of workers back during the recession... when a lot of people were out of work,” says Dave Adkisson, president and chief executive officer of the Kentucky Chamber of Commerce. “But we were hearing from employers, they couldn’t find enough people and enough people with the right skills.”
That problem is getting worse as the overall economy improves and more baby boomers retire, according to Adkisson. He says Kentucky lags other states in workforce participation because the commonwealth has high incidences of addiction, incarceration, and disability that hamper people’s ability to be productively employed. In fact, Kentucky would have to add 165,000 people to the workforce just to achieve the national average workforce participation rate of 62.7 percent.
It’s a problem that’s been 40 years in the making, says Education and Workforce Development Cabinet Secretary Hal Heiner. In the 1970s, three-quarters of jobs in Kentucky could be filled by those who had a high school diploma or less, according to Heiner. Now he says 80 percent of jobs require some sort of post-secondary credential or certification available through an apprenticeship program or community college, or a full associate or bachelor’s degree.
“We have been caught as a state flat-footed in terms of people not having the education and skill levels to fill the jobs that we have,” says Heiner. “It’s simply time to ramp up education and skills training to the realities of the workforce today and we’re slow doing that.”
In addition to better aligning education and training opportunities with the demands of today’s employers, Kentucky also has a geography issue, says Jason Bailey, executive director of the Kentucky Center for Economic Policy.
“About half of the state has a labor force participation rate above the national average,” says Bailey. “Then half of it has a rate below [the average] and in some cases far below.”
For example, in eastern Kentucky there simply aren’t enough jobs available, even with an improving economy, says Bailey. Meanwhile northern Kentucky and the Bowling Green area are essentially at full employment and desperate for workers. Adkisson says the Chamber has found nine unique regional economies within the commonwealth.
“You can’t just create policies and programs in Frankfort with one size fits all,” says Adkisson. “We’re going to have to make these very distinct to the regions.”
You may not think of the economically depressed communities of eastern Kentucky as a burgeoning hotbed of computer coding, but the company Bit Source is trying to change that. The three-year old software development company based in Pikeville is part of a movement to train and employ former coal miners in the computer coding industry.
It hasn’t been easy, though. Bit Source cofounder Rusty Justice says some locals had bought into the belief that they were somehow inferior to other workers even though they had spent years in highly skilled mining jobs. He’s had to help his employees re-imagine themselves and their skills
“We always tell them you’re the people here in Appalachia proving that a tech industry is possible here,” says Justice. “We can do high-quality tech here in the mountains with the people who are from here.”
Brack Quillen is one of the people who had to rethink his skills. He worked in coal mines for a decade before being laid off in 2014. He says he didn’t know how the Internet worked when he became one of Bit Source’s first employees.
“A lot of coal mining is processes... and that’s pretty much how computer coding is, too,” says Quillen, who is now a software developer at Bit Source. “It’s all logical: This needs to do this before something else can happen.”
Bit Source now employs nine developers, many of them coal industry veterans, who create coding for websites, games, apps, and software solutions. Another company, Teleworks USA in Hazard, has employed more than 1,000 people in the last four years in a variety of work-from-home jobs via the Internet, says Jared Arnett, executive director of the eastern Kentucky economic development agency called SOAR. He says these and other high-tech initiatives are all part of building a 21st century Appalachia that can compete in the digital economy.
“The estimate is by 2020, 50 percent of the workforce will work remotely, and why not in Appalachia?” says Arnett.
To continue to fuel this spirit of innovation in the state’s mountain counties, Kentucky Community and Technical College System President Jay Box says his four campuses in that region will offer degrees in entrepreneurism. Even with these new opportunities, the region still faces an uphill climb, says the Center for Economic Policy’s Jason Bailey.
“There’s going to be no silver bullet to replace 'what once was' in eastern Kentucky with the role coal once played, so what we need is a lot of silver BBs – we need a lot of ideas and a lot of new ideas,” says Bailey. ”The assets of the region are incredible: the beauty of region is incredible and the determination of the people is without peer, but it will be a slow process.”
Business and Education Partner on Job Training
Making employers more engaged partners in job-training is the idea behind Kentucky FAME, which stands for Federation for Advanced Manufacturing Education. It partners regional manufacturers with local educational institutions to help train students for jobs in those businesses. KCTCS’ Jay Box says the program was created in 2008 as a partnership among Toyota, the state’s advanced manufacturing association, and Bluegrass Community and Technical College. He describes FAME as a work-and-learn program.
“Students can work three days a week inside the plant and go to school two days a week to get the education and skill sets they need to be successful in that job,” Box says.
One other crucial facet of Kentucky FAME: students earn a competitive wage while they work.
The program has been so successful that other manufacturers around the state have partnered to create ten chapters at a dozen KCTCS schools. Toyota executive and FAME board member Kim Menke says the model has also been duplicated in nine other states.
“It not only addresses the technical skills that folks need to be in what we call our advanced manufacturing technician program,” says Menke, “but it also addresses those essential skills... that people can come to work on time every day and they can communicate, they can work in teams, and things like that.”
G.E. Appliance created a similar program to prepare people to work in maintenance jobs at its Louisville factory.
“Graduates receive a two-year degree from Jefferson Community and Technical College as well as get mentorship along the way from active maintenance employees,” says Catherine Werner, environmental, health, and safety leader at GE Appliance. “It’s really a special program.”
Box says these community college work-and-learn programs will continue to expand into additional manufacturing sectors and into other arenas such as health care. As more of these programs come on line, Melissa Aguilar of the Kentucky Workforce Innovation Board says she hopes they will be designed to benefit companies of all sizes.
“We continue to talk about big business, but we don’t mention very often the small- and medium-size business,” says Aguilar. “Where do other employers, small business get their employees?”
The Role of Higher Education
In earlier times, vocational education programs in high schools would have trained students to work at many traditional manufacturing jobs and in skilled trades. But Kentucky Labor Cabinet Secretary Derrick Ramsey says those classes fell out of favor in the last 30 or so years.
Now vocational ed is seeing a resurgence with apprenticeship programs and other efforts that allow students learn a skill and even earn money at the same time. Ramsey says 3,200 people are in state-supported apprenticeship programs, and there are 1,000 more apprenticeship slots available.
Other programs are geared to older Kentuckians who never graduated from high school. For example, Kentucky Adult Education Skills U, which is a part of the Council on Postsecondary Education (CPE), provides instructional services in all 120 counties, says the agency’s Jacqueline Korengel. It helps individuals prepare for the GED high school equivalency test, and puts them on the path to post-secondary education and training or essential workplace skills certification.
Even the state’s regional public universities are starting to tailor their academic offerings to better fit with the workforce needs in specific parts of the state.
“Four-year institutions have to be engaged,” says CPE Executive Vice President Aaron Thompson. “We also have to also look at higher education as a path for economic development. We know that the more highly educated people you have in a society, then [there’s] a greater chance that jobs will want to come here.”
All Hands on Deck
Boosting Kentucky’s overall workforce participation rate will take more than providing traditional students job-training opportunities. It means reaching out to what the Kentucky Chamber’s Dave Adkisson calls “marginalized populations,” such as young people raised in foster care, individuals with disabilities, prison inmates, military service members, and even retirees who might be lured back into the workforce.
“We need all hands on deck,” Adkisson says.
But reaching these individuals takes specialized services. Consider these statistics from the Cabinet for Health and Family Services: There are more than 8,000 youth in state care. More than 1 million Kentuckians are on Medicaid. The commonwealth has 2.5 times more disabled individuals than almost every other state in nation. And with more disability comes more opioid addiction, says CHFS Secretary Vickie Yates Brown Glisson. She says the state’s pending Medicaid waiver will use health policy to help address workforce issues.
“We want to make sure we’ve got a healthy population,” says Glisson. “We want to make sure that they can address any substance use disorder they may have and we want to make sure we get them aligned with a job.”
Kentucky also has some 25,000 people in jail and prison, the vast majority of whom will return to their communities at some point. That’s another target population that state officials want to prepare for the workforce.
“All the data indicates that if a person does not have a job, if they do not have transportation, if they do not have family support, there’s a heck of a chance that within two years they’ll be back [in jail],” says Glisson.
In fact one study shows that more than half of people who are unemployed after leaving prison will re-offend. But Justice and Public Safety Cabinet Secretary John Tilley says the recidivism rate for those with a job is only 16 percent.
“So if we’re not employing returning felons, they are going to go back to prison and that is bad for public safety,” Tilley says. “It’s a good thing to have a former felon get a job.”
Legislation passed earlier this year provides greater job training opportunities for inmates, and makes it easier for certain felons to obtain occupational licenses after their release.
“We really need to find a way that time in incarceration is time building skills and education level,” says Education and Workforce Development Cabinet Secretary Hal Heiner.
Then there’s the state military population. Each year thousands of soldiers pass through Fort Knox and Fort Campbell, and some of them will muster out of the service and return to civilian life.
As Kentucky employers seek to fill the thousands of available jobs, state workforce development officials have found servicemen and women at Fort Campbell to be a valuable asset. The U.S. Army base in western Kentucky on the Tennessee border is home to the 101st Airborne Division. Each month some 400 soldiers complete their military service at Fort Campbell and return to civilian life. West Kentucky Workforce Board Director Sheila Clark says she wants to keep as many of those service members in the commonwealth as possible.
“The workforce does not stop at the state line,” says Clark. “Whichever, whether it’s Kentucky or Tennessee, has the latest and greatest industry and has the greatest wages, then people are going to be attracted toward that.”
Making the transition from a military occupation to civilian work isn’t always easy though. Marc Quesenberry studied environmental and civil engineering at the Citadel and did two tours of duty in Iraq. Yet when it came time to leave the Marines and military life, he found it hard to get a good job.
“When I was getting out as a captain, I had a degree. I felt like I would be going either back to project management or back into the engineering field,” Quesenberry says. “I felt my education and my background and my experiences would be enough, but I really struggled.”
Now Quesenberry works to ensure that other service members don’t encounter similar obstacles. He is a veterans transition liaison for the West Kentucky Workforce Board, where he helps connect Fort Campbell soldiers about to exit the military with a range of services, including resume preparation, job interviewing skills, networking opportunities, and referrals to job placement services.
Fort Campbell also offers its own career counseling services to soldiers about to leave the military. The Soldier for Life Transition Assistance Program provides financial planning, resume preparation, job fairs, and other activities to help soldiers translate their military skills into jobs in the civilian marketplace
“They reach out and connect you with people that you don’t think of, says Edward Baldwin, who retired from the Army after 20 years of service. “Reaching out and making these introductions, making these connections with these people was a great help in... finding employment that would be satisfying.”
In addition to learning specific military occupations during their Army careers, soldiers also develop so-called soft skills that are highly prized by civilian employers, says Fred Workman, deputy program manager at Soldier for Life. He says service members learn leadership, teamwork, and problem-solving skills. They’re also able to pass drug screenings, which Workman says is critical for many jobs.
The Soldier for Life program also offers training in trade skills like plumbing, electrical, and advanced manufacturing as well as white-collar occupations like information technology and operations management. Teresa English, a career skills program coordinator at Fort Campbell, says 85 percent of soldiers who complete the career programs on the base find jobs within a month of leaving the military.
“All the soldier wants to know is a plan,” English says. “If you give them a plan, if you give them an opportunity, they will be successful.”