President-elect Trump’s manufacturing vision & the training gap

You may have read about my plans to retire from Siemens at the end of the year. To be clear, this is not a farewell post; I plan to continue posting on LinkedIn. But I do want to reflect some on my experience with Siemens and on a question that is really important to me:

How do we create a new era of U.S. manufacturing and rebuild the country’s middle class?

This question has taken on a new sense of urgency in the aftermath of what many are calling the greatest upset in the history of American politics – and given President-elect Trump’s ambition to retain and bring back manufacturing jobs to America.

And, it’s interesting. I’ve read a lot of thoughtful articles recently on this topic, including this one by Georgetown University's Anthony P. Carnevale. Then, yesterday, I saw this New York Times piece that, like a lot of recent articles, referenced my hometown and a famous song written about it by Bruce Springsteen, who sang: Seven hundred tons of metal a day / Now sir you tell me the world’s changed.

I mention this because, as I try to answer the above question, my perspective does not just come from the latest statistics and economic reports, or even from my past seven years working with a global industrial company that has chosen the U.S. as a vital manufacturing base. It also comes from my personal experience growing up in Youngstown, Ohio as the grandson of steelworkers.

My grandfathers both emigrated to the U.S. from Germany, each with little education, for the opportunity to wake up every morning, put on clean overalls, and go to work in Youngstown’s old steel mills.

It was days of heating iron ore to 3,300 degrees.

It was days of breathing dirt and – as I often say – eating dirt too.

Because that dirt meant a good job. And that job, even if occasionally unsafe and really tough, ultimately served a higher purpose by forging a path into the middle class for our family and many other families like ours. It was the American dream.

But I also remember the day when the dream in Youngstown fell apart.

 … September 19, 1977 – Black Monday …

I was a sophomore in college at the time. We were lucky, as my grandfathers had already retired.

But Black Monday was when Youngstown’s steel jobs started moving to other countries and the first of 50,000 local workers in steel and related industries lost their livelihoods.

In many ways, it was one piece of the broader story told by this chart.

Manufacturing jobs did start growing again after the Great Recession. The thing was, these jobs were not the same; they were higher-skilled, emblematic of a new era of advanced manufacturing.

This is the story about the Great Recession I don’t hear as much: It basically erased what we'd traditionally call the blue-collar economy.

According to Georgetown University’s Center on Education and the Workforce, the vast majority of workers who lost their jobs during the recession did not have a college degree; more than 95 percent of post-recession hires, though, were workers who had at least some college education.

The Great Recession, to be sure, was more than an economic downturn; it actually closed the chapter in American history where a high school diploma was a ticket to a well-paying manufacturing job.

So as I return to the question I started out with, my answer, in turn, returns to something I wrote in my first LinkedIn post in 2013.

America has a training gap . I know it’s more common to say that we have a skills gap, at a time when American industry is struggling to fill thousands of open positions. But in truth, it’s not a skills gap – it’s a training gap. Until we put the burden on those who train rather than those who need to be trained, we’ll never solve it.

At Siemens, we think one way that the training gap can be solved is by growing apprenticeships and by promoting and strengthening two-year vocational training options after high school.

But let me end with a broader point about why addressing the training gap is so important.

You saw above that I shared both Springsteen’s song and a chart illustrating the long decline and recent rebound in manufacturing employment.

The chart gives us insight into the recent presidential election. It shows the potential for jobs and the future of the workforce to drive the outcome as powerfully as they did.

Yet the President-elect spoke less towards the data than to the lyrics in the song: “We are going to put American steel and aluminum back into the backbone of our country,” he said, referencing Pennsylvania steel that built the Empire State Building. It was in this way that he spoke very directly to the desire for more well-paying jobs that undergird our middle class and challenged the entire political establishment.

His campaign messaging and his choice of cabinet members with business backgrounds are signals that the new administration will challenge corporate America, as much as government, to deliver more economic opportunities for the American people and to actively rebuild our middle class.

To expand advanced manufacturing, yes, we can put in place the right government policies. Yes, we can eliminate burdensome regulations to get the economy creating more jobs.

But ultimately the success of this effort will also come down to industry playing an outsize, proactive role in building the manufacturing workforce it needs to succeed, and that our country needs in order to have a strong middle class. This is about helping the many people who are looking for a job – or looking for a better job – to attain one of the hundreds of thousands of open manufacturing positions that already exist. Open manufacturing jobs are at an all-time high!

You know, in recent years there have been new calls to raise the minimum wage. But imagine if there were a minimum training standard. Imagine what this could do for people trying to reach a higher-paying job.

This is just one way the private sector can take the lead in forging new relationship with educators and economic development organizations. And to be clear, companies should take the lead. Only the companies themselves, after all, can articulate the precise skills they need to run their technology and add value to their operations, both today and in the future.

I am sure, ten years from now, that I will look back to 2010, the year I started at Siemens, and say: “That was the beginning of a new era in U.S. manufacturing.”

My hope is that I can also add: “Now – unlike then – there are so many more opportunities for hard-working people to acquire the advanced technical skills that no one is born with.”