Sunday, April 26, 2015

Hiring the Long Term Unemployed – A Possible Solution

Over the weekend, I ran across an old Bloomberg Business Week article about long term unemployed.  It got me thinking.  In economic development, one common goal is to create job opportunities for citizens.  A somewhat new challenge is the long term unemployed.  So much has been written about this and studies conducted, I suspect no one doubts the challenge. 

Bloomberg Business Week posted an article titled “Think the Long Term Unemployed Have Lost Their Edge?   Wrong”.  The author, Harold Sirkin, disagrees that long term unemployed (6+ months) skills deteriorate quickly and hence no longer technologically able to work.  The author contends that technology does indeed advance, but not that rapidly.  You can decide if he is right or not.

However, this is the most interesting point of the article is the training example. As you will read, the Chicago model, Skills for Chicagoland’s Future, is one economic development professionals should review and perhaps propose to local Workforce Investment Boards, community colleges and other institutions. It will not work in all cases, but should be in the arsenal of an existing business program.

The article offers a case study. The company highlighted is Seaton.  Seaton is an outsourcing and recruiting company. The Seaton company executive team wanted to hire 250 people.  As part of the program, Seaton HR department staff laid out the skills needed for the open jobs.  The Skills for Chicagoland’s Future took those skill sets and trained potential employees. The average new worker was unemployed for 18 months.

However, I prefer the United Airlines case study, also highlighted on the Skills for Chicagoland’s Future website.  This appears to me to be the classic case of doing a great job for your client and getting asked again to take on a more complex assignment. If you read the case study (link below) note the last paragraph. 

It might appear that the Skills for Chicagoland’s Future is like other training programs. However, this one is slightly different. From reading the annual report, it appears to me to be funded by government agencies, non-profit organizations, foundations and the private sector. In addition, a key goal is to help long term unemployed find jobs.

One more point to consider, the Workforce Investment Act (WIA) was recently reauthorized.  The professional economic developers should look at the language of the reauthorized law (Workforce Investment and Opportunity Act) and see if the new WIOA helps or hurts an initiative like this.  If it has a negative impact, then what revisions could we suggest be included in future legislative amendments.

Link to the article:

Link to the Seaton case study:

Link to Unites Airlines case study:

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