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April 25, 2013
Tech Training May Provide Fatter Paychecks Than 4-Year Degrees, Study Finds
By Katherine Mangan
When it comes to getting a job that pays good wages, students in Texas might get more bang for their buck by attending a technical, two-year program than they would by earning a four-year bachelor’s degree, according to a report presented on Thursday to the state’s Higher Education Coordinating Board.
The report, which echoes findings released last year by Georgetown University’s Center on Education and the Workforce, was prepared by College Measures, a partnership of two research and consulting groups, the American Institutes for Research, and Matrix Knowledge Group.
Among the findings, graduates with technical degrees and certificates often earned significantly more money than did those with other academic credentials. And students who graduated from regional and lesser-known universities typically earned just as much as those who graduated with the same degrees from the state’s flagship campuses—the University of Texas at Austin and Texas A&M University at College Station.
College Measures, which is supported by the Lumina Foundation, provides data to help students, parents, and policy makers determine how well colleges are educating students and preparing them for jobs. It has found similar results in its studies of public higher education in Arkansas, Colorado, Tennessee, and Virginia.
The new report comes at a time when Texas lawmakers are considering proposals to loosen high-school graduation requirements to allow more students to pursue technical trades in fields where employers are having trouble finding enough workers. Skeptics of that approach argue that students who are more broadly educated generally fare better over the long haul.
The College Measures study makes the case for looking at the short-term gain. It found that, one year after graduation, those with two-year technical degrees earned, on average, more than $50,000, about $11,000 more than graduates with bachelor’s degrees. And compared with graduates of two-year colleges who had focused on academic subjects, those with technical degrees were making about $30,000 more.
Those who went on to receive master’s degrees earned, on average, $63,340, or $24,000 more than the median first-year earnings of those who stopped with a bachelor’s degree.
‘The Truth Is, We Don’t Know’
Mark Schneider, president of College Measures and a vice president of the American Institutes for Research, acknowledged in an interview on Thursday that the salary someone makes one year after graduation doesn’t necessarily reflect a person’s lifetime earnings potential. Many educators point out that, with rapidly changing work-force needs, students who complete narrowly focused technical degrees or certificates might land lucrative jobs right away but struggle to move on if those jobs dry up.
“We’ve all heard about the philosophy majors who start out as baristas at Starbucks and go on to become barristers, and the person with a technical degree who’s going to be replaced by robots,” Mr. Schneider said. But when it comes to tracking salaries 10 years down the road, “the truth is, we don’t know.”
He said he hoped to extend his studies to examine earnings three and five years after graduation.
Another key finding, he said, is that “you don’t have to go to the most prestigious schools to do well in the labor market.”
You also don’t need a bachelor’s degree to do well, with holders of certificates—one of the fastest-growing credentials community colleges offer—sometimes outearning recipients of B.A.’s.
The median first-year earnings of graduates of some certificate programs, including several in health care, top $70,000. That’s $30,000 more than the statewide median salary for bachelor-degree graduates. Among the high-paying jobs certificate holders are landing in Texas are in construction engineering and pipe fitting.
The report compares how students who attend different types of programs in the same field might fare a year after graduation. For instance, someone who earned a certificate in business administration/management could land a job paying $37,000, compared with the $26,000 that went to an associate-degree graduate in the same field.
But certificates don’t always lead to higher-paying jobs. Just ask cosmetology students, many of whom earn $13,000 or less. Graduates with technical associate degrees in registered nursing earn an average of $68,000, while someone coming out with a certificate in the field can expect to make about $20,000.
Despite all the attention paid to the need for more graduates in science, technology, engineering, and mathematics fields, biology graduates at both the bachelor’s and master’s level earn less than statewide medians, the report concludes. Math graduates fare better, outearning biology graduates by more than $20,000 statewide.
Texas’ higher-education commissioner, Raymund Paredes, said on Thursday that the report confirms what earlier studies have shown about the value of technical degrees, but that students need to be educated about the long-term ramifications of choosing different paths.
“Many students, because of time and financial constraints, can’t invest the time and money it takes to pursue a four-year degree in a field that pays well,” he said. “Certificates can be a very viable pathway for many high-school graduates.”
■ The college is closing in on raising $17 million for its new Career Technology Center thanks to a donation from Monroe Bank & Trust.
BY CHARLES SLAT
MONROE EVENING NEWS (Front Page)
Published: Friday, March 29, 2013
The nearly completed $17 million Career Technology Center at Monroe County Community College apparently is nearly paid off.
A $ 50,000 gift from Monroe Bank & Trust has pushed the capital campaign for the building to more than 85 percent of its goal, said H. Douglas Chaffin, campaign chairman and MBT president and chief executive officer.
Mr. Chaffin said that the college has raised $ 14.59 million for the facility, with $8.5 million coming from the state, $4.25 million from the college and $ 1.84 million in current campaign commitments.
The college still needs to raise another $2.41 million.
The 60,000-square-foot Career Technology Center, expected to be completed in August, will contain state- of- the- art classrooms and lab space to provide students with a range of job skills.
Before announcing the $50,000 MBT contribution, Mr. Chaffin noted the importance of local business contributions to the economic vitality and quality of life in their communities.
“Since a majority of our shareholders live, work and worship in the communities we serve, there is a close affiliation between ‘shareholder return’ and ‘community investment,’ ” he said, adding that more than 50 percent of MBT employees have graduated from or attended classes at MCCC.
“As a community bank, we have a moral and ethical obligation to be a meaningful participant in local economic development opportunities, as well as contributions to an improved quality of life for local residents and businesses,” he said in a press release.
College officials said the $ 4.25 million being contributed to the center is in line with the amounts MCCC has allocated to major capital projects since 1991.
But MCCC President Dr. David E. Nixon said backing the new building was “a bold move by the college trustees. When they made it, it was a huge commitment in tough times,” he said in the release.
He said the use of reserve funding also is bold.
“ The college is playing it real close to the wire because of the state’s dwindling resources,” he said.
“ We are constructing a $ 17 million building for the citizens of Monroe County at a 75 percent discount to the total cost,” MCCC board Chairman William J. Bacarella said. “ This is a particular point of pride for all of us. When we reach our goal, MCCC can honor our donors and celebrate that only 25 percent of the funding for the facility will have come from MCCC’s reserve fund balance, with the rest coming from the state and from our generous private donors — the individuals, foundations, businesses and industries of Monroe County.
On March 8, the DTE Energy Foundation announced a $1 million gift to the Career Technology Center capital campaign. Other major gifts have included $ 500,000 from the La- Z- Boy Foundation and $75,000 from the Michigan Gas Utilities and the Wisconsin Public Service Foundation.
In addition, about $190,000 has been generated by an internal fundraising campaign that officially kicked off three weeks ago.
More than $ 50,000 of that total has come from employee gifts and all of the members of the board of trustees, The Foundation board of directors and the alumni association board of directors have contributed.
Michael R. Meyer, chairman of The Foundation at MCCC, noted that the college still is taking donations and anyone interested can contact college officials.
By Rick Haglund
March 12, 2013 at 3:01 PM, updated March 12, 2013 at 3:37 PM
Steve Lowe Jr. is scrambling to find more than a dozen skilled machinists, experienced engineers and laborers after his company recently won a multimillion-dollar contract to build giant camshafts for diesel locomotive engines.
He said he’s sought out state work force agencies, local community colleges and employment agencies in seeking the workers he needs to start camshaft production this summer.
Lowe said he even looked into hiring foreign workers through the federal government’s controversial H-1B visa program, which allows workers from other countries to work temporarily in the United States.
“To date, I have found no one,” said Lowe, president of LSM Systems Engineering in Waterford, north of Detroit.
Melissa Hull, engineering and production coordinator at American Tooling Center located in Grass Lake, east of Jackson, tells a similar story.
Business is booming, but the company is having difficulty attracting enough machinists, tool-and-die journeymen, and computer numerical control machine programmers to keep up.
“We’re swamped, said Melissa Hull, the company’s engineering and production coordinator. “We’re running 10-hour shifts a day, six days a week.”
That’s mostly great news after a decade in which Michigan lost about 468,000 manufacturing jobs — more than half of all manufacturing jobs in the state — as automakers, office furniture manufacturers and others struggled to survive the worst stretch of economic decline since the Great Depression.
But industry executives say an improving economy and a surprising comeback of manufacturer have left them struggling to find enough workers to take full advantage of the resurgence.
“The tables have been flipped,” Lowe said. “Two years ago we were just trying to keep the lights on. Now we’re trying to figure how we’re going to find the people we need to do all the work we have.”
Shortage Visible, Causes Aren’t So Clear
Other industries, including information technology and health care, also are reporting difficulty in finding the kinds of workers they need. But the labor shortages appear to be most pronounced in manufacturing.Some economists are skeptical that there is a true labor shortage in manufacturing, noting Michigan’s unemployment rate is still high at 8.9 percent and that most manufacturing wages are not rising.
“Manufacturing wages have been flat overall,” said George Erickcek, a regional economist at the Upjohn Institute for Employment Research in Kalamazoo. “That leads to questions about whether there is a talent gap in the state.”
Erickcek and other experts say if there were a true labor shortage in manufacturing, employers would be forced to boost wages to attract workers. For the most part, that’s not happening.
Manufacturing wages in the state have barely budged in the past four years, rising to an average $1,046.61 a week in December from $1,041.11 in 2008, according to the Bureau of Labor Statistics.
Adjusted for inflation, the average weekly manufacturing wage in Michigan has fallen $63.64 since 2008.
Manufacturers say stiff, low-cost global competition has kept a lid on wages. But they say the industry still offers decent money for the thousands of Michigan students who do not go on to a four-year university, but who have some education or skills training beyond high school.
Too many of those young people are taking dead-end jobs in shopping malls, restaurants and other retail outlets when they could be entering better-paying careers in manufacturing, some say.
“We train our youth to work in service-related industries versus making goods,” Lowe said. “We’re more of a consumer nation, rather than a producing nation.”
Plant floor jobs at American Tooling pay from $12 an hour for an entry-level machinist to around $24 for a journeyman tool-and-die maker.
“You have to be willing to put in the time (for training),” Hull said. “And you need to prove yourself for the first 90 to 120 days.
“There’s an attitude out there that ‘I made $25 to $30 an hour at a plant that closed and I’m not going to accept anything less,’” she said.
Some observers say manufacturers share much of the blame for the shortage of skilled workers they now face.
Factories have long had the reputation as being dirty, depressing places in which to work. Many employers cut wages and laid off workers throughout the 2000s, reinforcing manufacturer’s reputation as an unstable industry.
“A decade is a long time to talk about manufacturing when it’s all negative,” said Bob Sherer, director of the Michigan Workforce Development Agency’s manufacturing cluster.
Other experts say employers are hunting for “unicorns” — job candidates with qualifications far beyond what is required to do the work.
Manufacturers also cut training and apprenticeship programs, which dried up the pipeline of future workers. High schools dropped vocational education programs and some community colleges cut back on skilled trades curriculums.
Many of those who were laid off during Michigan’s “lost decade” left the state, found other work or retired.
“Some who left don’t want to come back. They’ve been burned too many times,” Sherer said. “(The upswing in hiring) has happened before in Michigan.
“But they don’t realize that it’s an unbelievably good time to get back into manufacturing,” he said.
Manufacturing Propels Job Growth
The state has added about 50,000 manufacturing jobs in the current recovery, representing more than 40 percent of all new jobs in the state.
But growth in manufacturing employment is likely to slow from 16,000 new jobs last year to 10,000 new jobs this year and 13,000 new manufacturing jobs in 2014, according to a University of Michigan forecast.Still, manufacturing will be responsible for 25 percent of all new jobs in the state over the next two years, the U-M forecast said.
Employers aren’t just looking to grow their staffs to meet rising demand. They’re also faced with having to replace large segments of their work forces that are nearing retirement.
“Any shop you go into in Southeast Michigan, the average age is in the 50s,” said Bill Rayl, executive director of the Jackson Area Manufacturers Association.
“Companies tell me that 50 percent to 60 percent of their work forces are eligible for retirement,” he said. “They don’t have a plan if those folks walk out the door.”
Success: The DIY Approach
Faced with severe shortages of machinists, welders and machine programmers, more companies have started training programs to develop new workers.And some have started to inch up salaries, said Annette Norris, program manager at JAMA’s Academy for Manufacturing Careers.
“There’s a big perception that manufacturing doesn’t exist any more in the United States and that it’s all gone overseas,” she said. “That’s so untrue.”
Another misconception about manufacturing is that factories are dirty and dangerous, Norris said.
“Some of the shops are so clean, you can eat off the floor,” she said. “They do pay well and you can earn a living.”
Erickcek said manufacturing wages vary widely by region and industry segment.
The average manufacturing wage for the highest-skilled workers in the Grand Rapids area fell from $75,000 in 2007 to $66,000 in 2011, the latest data available.But during the same period, the wages for the highest-skilled manufacturing workers in Kalamazoo rose from $57,000 to $65,000, Erickcek said.
The difference in wages between the two areas may have been a result of declining wages in Grand Rapids’ auto and office furniture segments, and rising wages in Kalamazoo’s pharmaceutical and medical device industries, he said.
State Tweaks its Training Programs
State work force officials have revamped job training programs in the face of employers’ immediate need for workers, particularly in manufacturing, health care and information technology.Former Gov. Jennifer Granholm’s “No Worker Left Behind” program trained displaced workers and others for opportunities in growing industries. But officials said it was a costly program that too often didn’t result in participants landing jobs, in part because Michigan’s economy was still shrinking.
“In the previous administration, the focus was on getting as many people as possible in training for in-demand occupations,” said Gary Clark, director of talent development services at the state Workforce Development Agency.
But that training didn’t always line up with actual job openings because the state didn’t know enough about the actual job requirements to provide the right training.
For instance, a job seeker might have trained to be a welder, but might not have learned the specific welding skill among many types of welding that an employer required.
“Now we’re meeting with specific industry groups and employers to find out exactly what they need,” Clark said. “Once we get an idea of what the actual jobs require, we can get people trained for those jobs. “We’re developing demand-driven work force programs.”
The state is continuing to deliver job training assistance through 100 Michigan Works! service centers. Clark said the state is required to administer job-training programs through the centers under a 2006 state law.
But state officials are faced with trying to meet the demand for more training with fewer dollars. Most of the state’s job-training money comes from the federal government, which has slashed training funds in recent years.
Appropriations to Michigan from the federal Workforce Investment Act have fallen nearly 55 percent, from $243 million in 2008 to $110 million in the current fiscal year.
Even job training for veterans has been slashed despite all of the talk of trying to help them make the transition from the battlefield to the workplace. Michigan is receiving $5.5 million in federal funds this year to train veterans, down about $600,000 from 2011.
Congress has not reauthorized the Workforce Investment Act in years. Instead, states have received training dollars through budget continuations, which some fear could end because of various austerity measures being considered by Congress.
“The big thing for us is that the federal government reauthorize the Workforce Investment Act,” said Sarah Hartzler, president of the South Central Michigan Works! office in Hillsdale.
Her agency works with American Tooling Center and other Jackson area-companies to help them find and train workers they need.
“Reauthorization will have a direct impact on the amount of training we can provide,” she said.
Rick Haglund has had a distinguished career covering Michigan business, economics and government at newspapers throughout the state. Most recently, at Booth Newspapers he wrote a statewide business column and was one of only three such columnists in Michigan. He also covered the auto industry and Michigan’s economy extensively.
© MLive.com. All rights reserved.
OUR VIEW – Monroe Evening News Editorial – Friday, March 15th, 2013
▼ To the point A $1 million donation from the DTE Energy Foundation will help Monroe County Community College pay for its new on-campus training center.
Monroe County Community College has received a huge boost in its continuing efforts to pay for the Career Technology Center being completed on its main campus.
The $1 million donation is one of the largest grants issued by the DTE Energy Foundation, and will help the college meet its $8.5 million share of the construction cost. Other major corporate pledges so far include La-Z-Boy Incorporated and Michigan Gas Utilities, which leaves about $6 million to the responsibility of a community campaign. State funding will pay for the remaining expenses of the $17 million facility, which opens in the fall for classes.
“ We are the largest taxpayer and largest employer in Monroe County and we’re pretty proud of that,” said Ron May, DTE senior vice president of major enterprise projects. “ We don’t like the idea that we’d have so many employees here and wouldn’t support the community. We want to do our part, so we’re here today and proud to announce that DTE Energy Foundation is donating $1 million dollars — it’s hard to say, it’s such a big number — to support the capital campaign.”
Getting money from DTE’s Foundation is not a slam-dunk for groups applying. Only about a third of the nearly 1,400 requests a year are granted. The $1 million amount is also notable in that the foundation’s annual allocations total only about $8.5 million a year. It also might spur giving by other corporate donors.
The 60,000-square-foot tech center at MCCC is designed to be flexible as needs change, but is intended for instruction in technical careers such as welding, auto engineering and renewable energy. Nuclear technology classes also will be scheduled there, and a historic exhibit with interpretive displays and oral histories about the Fermi 1 atomic breeder-reactor plant also will be among the building’s features. Many of the technology classes have been meeting in rooms described as cramped and outdated, which has been frustrating for those in that department.
The Career Technology Center reflects a clear priority on academics and technology rather than student and community services, a trend at two-year schools, which increasingly are being authorized to provide curricula culminating in four-year degrees.
“This is long overdue,” Peter Coomar, dean of the Industrial Technology Division said last fall. “The word here is need, not want.”
DTE’s substantial donation to the Career Technology Center demonstrates its commitment to getting the best-trained people for its own operations and its dedication to the community’s efforts to train today’s workers for jobs that should be in demand tomorrow and beyond.