Bridging the Middle Skills Gap: Intermediary and Nonprofit Initiatives

Your zip code should not predict your future, but oftentimes it does. Where people are born has quite an impact on their access to resources, social status, and all of the things that could lead to better employment and better life outcomes.

Michelle Massie, Director of Opportunity Nation and Strategic Initiatives

Middle skills jobs are often thought of as “blue-collar” jobs, encompassing roles like plumbers, construction workers, and electricians. The category also includes any other career that requires less than four years of college (but more than just a high school diploma), such as medical technicians and cybersecurity experts. These jobs fall within industries that are considered the foundation of the American economy—yet roles in these fields are increasingly going unfilled.

Experts say there are many reasons causing this phenomenon, which we explored in a previous article. One significant factor is the increasing number of students entering bachelor’s degree programs as opposed to alternative options, like associate’s programs or apprenticeships. There’s been an overwhelming influx of studies that project growth in areas like STEM (science, technology, engineering and math) in our increasingly automated and digitized world. What’s less covered is the fact that many of the new job openings will fall into the middle-skills category.

“Now, we’ve been in a tech boom for the last 20 years or so. For a while people thought technology would wipe out these blue collar jobs, but what we found is that it’s not completely true. That’s not the full story of what the workforce looks like today,” Michelle Massie said, a leader from nonprofit Opportunity Nation said. “This caused many students to pursue bachelor’s degrees in careers like the STEM field, and less to pursue middle skills jobs.”

While there will continue to be demand for bachelor’s degree-holding workers in STEM, no doubt, middle-skills jobs also need quality entrants. An article from the Harvard Business Review says that while no “aggregate estimate of the shortage of middle-skills workers” has yet been released, “the number is expected to grow substantially as more baby boomers retire.”

And it doesn’t appear that enough young people are pursuing such careers to compensate for the upcoming openings.

Workforce intermediaries that specialize in connecting individuals with potential employers are being looked to for answers, and many are rising to the challenge. These organizations can be nonprofits or other kinds of public organizations—not to be confused with temporary employment firms, which operate within a for-profit model and focus solely on job placement. Rather, intermediaries look at long-term job retention and career advancement, and tend to focus specifically on low-skilled workers.

We talked to a leader from one such nonprofit, Opportunity Nation, and another from the Center on Wisconsin Strategy (COWS) to get a better understanding on how intermediary organizations are addressing this issue. What did we learn? There are a few different approaches that third party organizations are taking to rectify this perceived imbalance.

Michelle Massie is the director of Opportunity Nation and Strategic Initiatives, where she is responsible for advancing the Forum for Youth Investment’s Opportunity Nation initiatives, including the annual Opportunity Index, which quantifies opportunity levels by state and county in the U.S. She leads the Forum’s efforts to better utilize data about economic mobility and opportunity to secure bipartisan support for policies that improve racial, social, and economic equity.

Massie studied journalism and political science from Rutgers University in New Jersey, where she got her bachelor’s degree, and later earned her master’s degree in public and nonprofit management at the University of Pittsburgh.

Laura Dresser is the associate director of the Center on Wisconsin Strategy (COWS), a prominent think tank in the state. She is a labor economist, an assistant clinical professor at the University of Wisconsin-Madison School of Social Work, and an expert on low-wage work and workforce development systems. She works with labor, business, and community leaders in building stronger labor market systems. One of her main projects has been with the Wisconsin Regional Training Partnership (WRTP), which we will discuss further, below. Dr. Dresser has a bachelor’s degree from Rice University, a master’s in social work, and a PhD from the University of Michigan.

The Wisconsin Regional Training Partnership (WRTP) is nationally revered as one of the most successful cooperative labor-management training models, according to the Harvard Business Review and the Albert Shanker Institute.

The Midwest is one of the longest standing major manufacturing centers in the country, but the 1980s was a decade of economic devastation for Wisconsin. In ten years time, Milwaukee County lost “fully a third of its traditional industrial base,” which is how the training partnership was born.

WRTP brought together employers, educational institutions, and unions to strategize about how to improve Wisconsin’s economic situation, as well as talk about how companies could better attract and retain qualified staff. In 2001, WRTP began working closely with an organization called Building Industry Group Skilled Trades Employment (BIG STEP). One of the main fruits of the WRTP/BIG STEP collaboration has been the development of short training programs that address specific employers’ requests or to other labor market needs.

WRTP/BIG STEP and similar initiatives foster apprenticeships at local companies—a replicable model for other communities that need help connecting middle-skills workers with employers. Since the early 1990s, WRTP has connected more than 4,000 Milwaukee residents to family-supporting jobs in manufacturing, construction, healthcare, and other industries, with average annual earnings raised by 165 percent in the first year of the job and a one year retention rate of over 70 percent.

According to the Harvard Business Review, individuals who participated in WRTP and other similar sector-based training “had better outcomes than those in a control group of comparable people who were not part of the program. The participants were more likely to find steady jobs, work more hours, and earn a higher hourly wage.” In fact, they earned 29 percent more, on average, in the year following the training than the controls did.

Another example Dr. Dresser gave is a series of programs called Equity in Apprenticeship: “Milwaukee people were noticing a need for a step above the frontline entry level manufacturing jobs,” she said. Initiatives like the Industrial Manufacturing Technician (IMT) program, a collaboration between labor and management leaders in Milwaukee’s manufacturing sector, has created a new “rung in the ladder” in production jobs.

“The infrastructure that really is supporting building trade skills development are these joint labor management training infrastructures,” Dr. Dresser added. “Focusing on middle skills jobs, we’re thinking about, well, how does the infrastructure work and what do we need to keep supporting it or extending from it in terms of the including workers’ input, and worker voices.”

Opportunity Nation, a nonprofit based in Washington D.C., is also concerned with connecting youth to employment opportunities. It is addressing the issue in a couple of different ways.

First, it compiles data on opportunities for youth throughout the U.S. The organization’s Opportunity Index looks across 20 indicators and four dimensions (education, health, community and economy) to measure the level of opportunity in states and counties in the U.S. With it, each state is assigned an economy score, an opportunity score, and other measurements compared to the national averages, which can be a tool for government groups, companies, and individuals.

In addition to its extensive research, Opportunity Nation also teams up with outside organizations to impact policy and decisions made within communities.

“Your zip code should not predict your future, but oftentimes it does,” Massie said. “Where people are born has quite an impact on their access to resources, social status, and all of the things that could lead to better employment and better life outcomes. We look at practices that get people into better jobs, to help get people into more secure housing, and to increase wages.”

Both Dr. Dresser and Massie acknowledged the middle skills gap and the competition that employers face amongst each other to find qualified candidates, but pointed out that the gap is not all about a “lack” of entrants. There is some responsibility on the shoulders of companies themselves and what they are doing to help to impart middle skills.

The first point may be obvious, but employers that want to attract quality employees need to offer quality jobs—or more specifically, more substantial salaries and benefits, like healthcare, vacation time, and pension plans.

“It may be less a skill gap and more a job quality gap,” Dr. Dresser said. “I try to be a lot more attentive to the quality of the jobs that are going unfilled. One of the things that has happened over time is that manufacturing wages have become stagnant, in real terms. A welding shop that is not paying more than $13 an hour complaining about a skills gap is a much lower priority.”

Massie agreed: “If wages are stagnant and aren’t keeping up with the cost of inflation, with the rising cost of everything around you including healthcare and housing, then you are still in a position that people are not thriving,” Massie said. “You can talk about the number of job openings for days, but if we are not talking about job quality and not looking at career pathways that can help people grow in their careers, then you’re back at square one.”

Another problem could be that employers are expecting workers to hit the ground running upon hiring, which is unreasonable in some middle skills positions, like advanced manufacturing. The duties of roles within this industry may vary greatly depending on the role and company.

“One thing that I think is happening now is that manufacturers often have an expectation that people know specific types of equipment when they come into the job,” Dresser added. “There used to be enough cushion where the employer might not have expected workers to know the specifics,” and would train them upon hiring. That’s why it’s so important that organizations like Dresser’s are trying to help companies and businesses create training programs.

Employers should also be open to giving opportunities to less experienced applicants that may have just completed their training or schooling, that do not yet have professional experience in the field, as well as marginalized populations, like ex-offenders.

“You have to be willing to look at the populations that have been overlooked and discounted as potentially great employees,” Massie said. “This is an excellent area where you can take folks that are looking for employment that have acquired skills while they were incarcerated.”

“The main takeaways are that this is a nuanced discussion,” Massie added. “Until we address student loan debt and wage stagnation, we’re going to continue to have questions. There are policy issues that tie into this that need to be addressed.”

Nonprofits and other public intermediary organizations that are helping to address the issue need funding to continue their work, “which has been a challenge to maintain,” Dr. Dresser said. The sources of funding for initiatives like that of WRTP/BIG STEP have been precarious in the past, but it has been successful in securing sources from government funding, like the federal stimulus package of 2009 and through other partnerships.

The continued challenge comes down to “securing private investments, helping direct public investments, and helping secure workers’ interests in the context of direct employer need,” Dr. Dresser said in closing.