The US Needs To Copy China To Solve The Skills Gap

Business Insider

There are around 600,000 unfilled manufacturing jobs in the U.S., even though the unemployment rate remains stubbornly high. This sad fact comes down to a matching problem. 

At a recent Atlantic conference on "Manufacturing's Next Chapter," David Arkless, the President of Corporate Affairs and Government at The Manpower Group argued that there are ways to solve this problem if the U.S. has the willpower to act.

Other countries throughout the world don't have the sort of skills gap the United States does.  "It's b ecause they have developed an integrated system to forecast the skills they need down to the man hour level, the competency level they need," Arkless said, "and they've gone back to the education system and they have prepared young people to want to go into jobs that are going to be needed in the future."

Arkless doesn't have much patience for excuses. "People say 'David, it's impossible in a country like America to forecast the skills we need in detail,' sorry, no it isn't. If you can do it in six months for a 26 million person entity called Shanghai you can do it in America."

Students don't know what those 600,000 jobs are, let alone what training they need. Companies know what they need, there are schools available to train these workers, and there are government programs to help certify or pay for the education. But these groups don't talk to each other or have a consistent way to cooperate, despite the fact that every stakeholder, and the country as a whole, would benefit.

As an example of a place that's taken aggressive and intelligent steps, Arkless gave the example of Tianjin, China.

"The Chinese economy is forecast to grow at 6 percent this year. The city of Tianjin, which is huge, its economy is growing at 17.9 percent. That's huge compared to the Chinese benchmark," Arkless said. "They went out very smartly and asked every foreign company investing in Tianjin, 'what would cause you to invest more? What would bring you here?' And the answer from every one of the 2000 companies they surveyed was the right skills at the right cost."

With The Manpower Group, Tianjin evaluated every young person from ages 16-18. Entrepreneurial and creative types were encouraged to start their own business or join a small or medium business. The rest were evaluated for their vocational leanings, and given a compelling incentive to pursue it.

Arkless paraphrased the government's pitch: "OK guys, you were thinking of going to Beijing University to study physics, however if you're willing to stay and go to Tianjin Vocational University to study value added logistics, we will pay for your training costs and education, we will give you free accommodation for four years and guarantee you a job at a certain wage level. Are you interested?"

Unsurprisingly, many were. The program's helped Tianjin grow its small and medium businesses by 300 percent over the last 2 years. 

Obviously that's not a program the US can perfectly replicate. But the country needs something of similar ambition, or it will be beat by Tianjin and places like it. The country needs what moderator Frederick Kempe called a "Sputnik moment," referring to the moment when the US was beaten to space by the Soviet Union, and responded with the Apollo program. 

The motivation is clear. According to Arkless, filling those 600,000 empty jobs could provide a 2.2 percent boost to GDP. America is the country that went to the moon. It should be able to put similar effort towards getting kids in contact with and on the path towards joining the companies that need them. 



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