Incentive Programs Help Employers Grow Qualified Workforce

Though the Michigan unemployment rate has been trending downward, it remains relatively high at 5.6 percent. At his January 2015 State of the State address, Governor Rick Snyder identified workforce talent as “the new currency of economic growth.” Since noting a few years ago that employers’ needs and worker skills in Michigan were not in sync, his office has continued – or created – multiple state-level workforce incentive programs to add to the repertoire of similar federal assistance in growing a qualified workforce, including the recent launch of the Department of Talent and Economic Development.

Locally, Northwest Michigan Works! (NMW) – which since 1987 has served to establish public-private partnerships to provide services and support to the region’s workforce development system – administers these employer-driven programs.

At the Traverse City location of Morrison Industrial Equipment, branch manager Tom Purgiel uses NMW as one of the resume pools he draws from, partially because there are special incentives at times for certain unemployed or underemployed candidates seeking work.

“In our business, there are special job skills a technician must possess to be a productive worker,” Purgiel explained. “For example, there’s a learning curve in becoming trained and proficient in forklift repair. Morrison has a training program where we offer to teach candidates skills they need to become mechanics in the material handling world.”

Purgiel recently came across a resume for a candidate whose company had changed ownership, eliminating his job in the process. Because that candidate was a displaced worker, he was eligible for training funds and Purgiel hired him as a service mechanic.

“By utilizing the program through NMW, it helps to offset the costs of training that employee over those first three, six, or nine months,” he added. “These programs buy me time to get employees adequately trained.”

Purgiel estimated he has used such programs a handful of times over the past five years, as it affords him the opportunity to bolster staffing levels – especially for needs he foresees down the road.

Incentivizing Workforce Development

Two of the most recent additions to the state’s workforce development incentive programs are the Skilled Trades Training Fund (STTF) and the PATH (Partnership. Accountability. Training. Hope) program. STTF provides competitive rewards for training to bolster employee talent, productivity, and retention at eligible Michigan businesses. It does so by establishing partnerships with shared costs across the public and private sectors in developing classroom, online and onsite training modules. Since January 2013, PATH – an overhaul of its predecessor, the Jobs, Education, and Training, or JET, program – has been administered as a work participation program that evaluates and helps prepare job applicants in families receiving state aid (in the form of the Family Independence Program).

At the federal level are programs such as the Workforce Investment Act (WIA), which passed in 1998 and was reauthorized in 2013). The Adult and Dislocated Worker program under the WIA assists job seekers in finding and becoming qualified for meaningful employment, including those who lost their job in a substantial layoff, are ineligible or have exhausted unemployment insurance, or were self-employed but cannot sustain the business due to economic conditions.

Workforce development activities under these state and federal programs may take several forms. Among them are basic computer literacy; short-term occupational and degree-granting classroom study; short-term, intensive just-in-time training, with recruitment, screening, and training facilitated by NMW to meet employer needs within a given industry sector; customized training with employers facilitating the screening and interviewing; short-term, work-based scholarships for in-demand occupations; apprenticeships; worksite workshops and career counseling; on-the-job training for new hires lacking specific skills necessary to perform the required work; and basic adult education programs.

How Other Local Companies Have Benefited

Similar to Morrison Industrial, there is also a long learning curve for employees at Grand Traverse Machine Company, a manufacturer of precision machine components. “Training is very expensive, and it can be months down the road until we see the benefits of new employees,” said Michael Alfonso, president.

Through the STTF, beginning in February, Grand Traverse Machine Company did a speed interview session, interviewing 12 candidates in one day and then selecting trainees to participate in a combination of in-person and online classroom time coordinated with other similar employers and NMW, all sharing the costs. Alfonso’s company also made use of on-the-job training reimbursed by the federal government.

“It’s a struggle to find qualified computerized numerical control machine operators,” Alfonso explained, noting that the resume of one of his recent hires entirely reflected restaurant industry experience. “We’re willing to train people with no experience, so these programs have been very beneficial. It’s been helpful to the new hires for individual growth and to the growth of our company.”

At Flight Path Creative, a full-service marketing and communications firm in Traverse City, co-founder and creative director Aaron Swanker has utilized the on-the-job-training incentive to boost the skills of four project managers.

“We’re a service business, with staff expected to meet billable hours percentages,” said Swanker. “We need employees to be 80 percent billable, but for employees who are not ready right out of the gate, their training costs are covered.”

NMW assists Flight Path Creative in providing the guidelines and assisting in creating goals for the trainee as well as providing financial support.

“It reinforces what we’re trying to do, helps to identify areas of weakness, and trains them so they’re in great shape for us when the financial incentive is no longer there,” Swanker said. “These are positions we would have created without the assistance from NMW, but knowing we can get financial help assists us in decision-making, if the candidate is unemployed or underemployed, as not all qualified candidates are necessarily a good fit.”

Giving Back and Getting Back

All three company leaders noted they feel as though they are giving back by way of retaining the employees whose training has benefited from these state and federal assistance programs. At Morrison Industrial retention is critical, said Purgiel, especially given the monetary investment in the employee’s first year as a trainee. But, he explained, it’s well worth the cost.

“It’s always a challenge to attract and retain employees, but we have had good success with the NMW programs.”

Swanker also noted that as a small business, it is fantastic to have resources like NMW. “It doesn’t always seem like small businesses get a lot back from the government, so it’s nice to see the benefit from the tax dollars we’re paying.”