Fixing Ohio’s economy

Worldview Thought of the Day

Ohio is having a hard time in the current economy. Low-tech manufacturing like the American automobile industry is collapsing under the weight of prices and competition, and workers find that they have very few options for reemployment in those kinds of industries. Such unemployment creates a drag on the economy and suffering for the people and families facing such it.

Obviously, unemployment is problem for Ohio, but it is also problem that deserves perspective. Ohio’s current unemployment rate sits at 7.2 percent. In 1983, it hit 13.8 percent. In other words, right now, 93 percent of Ohioans have jobs, 7.5 percent more than who had jobs during the last period of economic uncertainty. Also, factor into this equation that many modern economists state that theoretical complete employment is around 4 percent, meaning that, in order for the American economy to function, 4 percent of Americans need to be between jobs.

Nevertheless, Ohio’s unemployment rate is higher than the national average of 5.7 percent, and this problem is exacerbated by the reality that most of those who have become unemployed in recent years will have no opportunity to find jobs in their professions in Ohio because those jobs have gone away altogether. Ohio needs a plan simply because, without one, the problem stands to get worse.

The popular plan involves government intervention; intervention that cannot help but involve increased taxes on those who are still working, thereby creating further drag on the economy. While the plan itself has elements that can succeed, it ignores the greatest chance of success.

From my perspective, the solution to Ohio’s economic troubles is obvious, direct, and involves very little government intervention.

Taking responsibility for ourselves

Ohio’s workers need to take responsibility for themselves. Low-tech manufacturing and labor-based jobs are dying industries. These jobs are not coming back because they have been replaced by a technology economy that requires workers skilled in specific areas. The answer for the worker is retraining through a variety of venues.

As an example, most health care professions–not just nursing–have a 100 percent employment rate and most students pursuing those professions do not pay a dime for their education. Tooling and computer aided manufacturing programs have a similar 100 percent employment rate.

Certainly, such a pursuit requires an investment on the part of the worker, but it is an investment with a huge payoff: a new skill set in a highly employable field. Practically every worker currently laid off in Ohio qualifies for existing job retraining programs and educational financial aid. The result is freedom from the uncertainty of a dying industry and the promise of ongoing employability.

Taking responsibility for the jobs

I heard from a local business leader several months ago that the Greater Dayton-Springfield region has 22,000 unfilled jobs available, nearly every one of them vacant because there are not enough qualified workers to fill them. These jobs range from hourly technical jobs like mechanic to high-tech salaried jobs like engineers, nurses, and doctors.

The tragedy is that no one seems to be able to see how to convert the thousands of people who are unemployed in certain industries into people who are employed in other industries. Education and training for unemployed workers is obviously a part, but perhaps more importantly, having the resources to allow for that education and training is also a part.

If employers contributed even a small fraction of the cost for retraining unemployed workers for new jobs, the deficit of both unemployed workers and vacant jobs would plummet quickly. Since many jobs that remain vacant require education and retraining that take less than a year to complete (e.g.: high tech manufacturing, automotive technicians, many computer related jobs), I believe it is arguable that both deficits could be erased in a year with a small investment from employers.

In Montgomery County, Ohio, unemployed workers can attend the local community college for practically free using available retraining programs. Even if retraining workers have to pay, the cost is just $45 per credit hour. With a full-time class load, that is $540 per quarter or $1,620 for a year. If an employer contributed just 10 percent of that cost for retraining per worker per year, they could train 11 workers for every ten they actually supported at a cost of $1,620 a year. Most companies spend that much on coffee every year.

The bottom line is that investing in employment means investing in employees.

Taking responsibility for education

Obviously, I believe education is a huge factor in unemployment. In fact, I go so far as to say that the more educated a person is, the less likely he is to ever be unemployed. I say this because educated people are far more likely to be able to adapt to new, different employment with little or no training than are undereducated people.

That being said, I believe that the actual cause of a significant portion of modern unemployment is the poor state of education of the average high school graduate. Simply put, many kids graduate with barely enough skill to make change at McDonalds, let alone get a job that pays a living wage. There are many reasons that our educational system is broken, but I believe there are four reasons directly related to employability.

First, the educational system makes no attempt to identify what students are good at and are capable of doing. As a result, students often graduate with a set of skills that in no way prepare them for what they are actually going to end up doing. This makes higher education requirements far longer and more expensive. Simply helping students know what they are good at would help make those students more prepared for their futures.

Second, because the educational system makes no attempt to help students figure their futures out, it does not provide them with educational opportunities designed to build their skills and improve their weaknesses. Targeted education designed to help students prepare for the workplace would help make sure that every student is prepared for their futures.

Third, not every student needs to go to college, especially not right away. Many, if not most, jobs in the United States do not require a four year degree. Quite a few do not even require any level of college. Instead, most jobs require specific skill sets, that if provided through targeted job training programs, would create a work force designed for the jobs that actually exist.

Fourth, students need to understand the jobs that are actually available given their interests, skills, and educational achievements. Training and receiving education for jobs that do not exist will not make those jobs somehow appear. Students should be steered toward the existing market or counseled on how and where the jobs they want can be found.

Taking responsibility for the bottom line

Notice that none of the three categories I presented here has anything to do with the government doing anything to create jobs or help the unemployed. I do and have always believed that such problems are more directly and conclusively solved by the people than by the government. I think that the current economy is exactly that kind of problem.

If Ohio wants to solve its current unemployment, Ohioans are going to have to be the ones who do it. There is a way for that to happen; people just have to do it.

-=DLH=-