Companies Ramp Up Worker-Retraining Efforts
Tight labor market pushes companies to invest in teaching current workers to do more sophisticated tasks.
Dwayne Mace has been a painter and a construction worker throughout his 37 years at Lamar Advertising Co. Now he’s a digital billboard repairman training the next generation of workers.
“Everyone needs to be willing to adapt, or they will go the way of the dinosaur,” Mr. Mace said.
Lamar is one of many U.S. companies retraining less-educated workers for more sophisticated tasks. Two-thirds of manufacturers plan to increase training in the next year, according to a report from the National Association of Manufacturers, and President Trump signed an Executive Order in July to explore ways to encourage investment in job-oriented training programs.
“In a tight labor market, you need to put up the investment to work with what you have,” said Jeff Strohl, the head of research at the Georgetown’s Center on Education and the Workforce. The U.S. unemployment rate was at 3.9% in July, near the lowest point in 18 years, and nearly a half-million U.S. manufacturing jobs were unfilled in June, according to the most recent Census Bureau data, a level last seen in 2001.
SOME COMPANIES ARE EXPERIMENTING WITH “RADICAL RESKILLING” PROGRAMS TO TURN ENTRY-LEVEL EMPLOYEES INTO TECHNOLOGY WORKERS.
DWAYNE MACE, CENTER, IS A DIGITAL TECHNICIAN FOR LAMAR. FOR MOST OF HIS 37 YEARS WITH THE COMPANY, MR. MACE HAS SERVED AS A PAINTER AND CONSTRUCTION WORKER. NOW HE IS HELPING TO TRAIN A NEW GENERATION OF EMPLOYEES. PHOTO: JUSTIN IDE FOR THE WALL STREET JOURNAL.
Meal-kit company, Blue Apron Holdings Inc., is investing in automation that could reduce the need for some production jobs. The company recently sent line worker Tasi Twinamaani to a 10-month coding academy in partnership with C4Q, a nonprofit based near Blue Apron’s facility in Linden, N.J. Ms. Twinamaani now makes $90,000 a year as a web developer, compared with $30,000 on the line.
“I don’t have a degree, and now I’m a software engineer,” Ms. Twinamaani said. “It’s possible.”
The costs of teaching employees skills like how to run robotic machines can pay off through higher worker retention, according to executives and economists.
“I’M NOT TRYING TO SELL A JOB,” SAID MICKY VINT, LAMAR ADVERTISING’S HEAD OF FIELD OPERATIONS. “I’M TRYING TO SELL A JOB AS A CAREER.”
JUST 2% OF LAMAR’S ROUGHLY 150,000 BILLBOARDS HAVE BEEN DIGITIZED, BUT THAT FRACTION GENERATES MORE THAN 20% OF THE COMPANY’S BILLBOARD REVENUE. PHOTO: JUSTIN IDE FOR THE WALL STREET JOURNAL.
EMPLOYEES AT BATON ROUGE, LA.–BASED LAMAR, WHICH BUILDS BILLBOARDS AND SELLS ADVERTISING ON THEM, HAVE SEEN FIRSTHAND HOW TECHNOLOGY HAS REMADE WORK IN THE U.S. IN THE EARLY 1900S LAMAR EMPLOYEES PAINTED BILLBOARDS BY HAND. BY THE 1990S, THE COMPANY’S WORK CREWS WERE HANGING THOSE SPACES WITH VINYL PRINTOUTS.
Lamar is now turning to digital displays. While they cost up to $250,000 to buy and install—compared with up to $100,000 for a traditional board—the company is already seeing considerable returns. While just 2% of Lamar’s roughly 150,000 billboards have been digitized, that fraction generates more than a fifth of its billboard revenue.
Mr. Mace runs a training program in Pensacola, Fla., where he teaches workers how to repair digital screens. Lamar offers higher wages to workers who complete the weeklong programs, and about 425 workers have done so in recent years. Lamar currently employs 358 digital technicians.
“GIVING GUYS SOMETHING TO SHOOT FOR HAS BEEN A BIG PUSH,” MR. MACE SAID. “IN TRAINING, THE CREAM RISES TO THE TOP.”
EMPLOYERS CITE LABOR QUALITY AND SKILLS SHORTAGES AS TOP CONCERNS. LAMAR ADVERTISING IS DEVELOPING A PROGRAM TO UPDATE THE SKILLS OF EMPLOYEES WHO WERE TRAINED AS DIGITAL BILLBOARD TECHNICIANS JUST A FEW YEARS AGO. PHOTO: JUSTIN IDE FOR THE WALL STREET JOURNAL.
Training investments are rarely a one-time expense as technology changes and employees leave. Next year, Lamar is introducing an advanced program for employees whose digital training a few years ago already needs updating.
Nearly a fifth of manufacturers the Census Bureau surveyed during the first three months of this year said an insufficient supply of labor and skills was one reason they were operating below capacity. The National Federation of Independent Business said 23% of small-business owners cited labor quality as their most pressing issue, the highest level since 2000.
Welding-equipment maker Lincoln Electric Holdings Inc. recently opened a 130,000-square-foot training center in Cleveland, Ohio, as part of a $30 million initiative to train new welders and expand the skills of existing ones.
A lack of welders is one reason Lincoln is investing simultaneously in automation, said Gary Konarska, general manager at the company’s Cleveland automation facility, which is located across the street from the new training center. The automated welding machines still need human coders and operators, Mr. Konarska said, which other company training programs will help supply.
Lincoln teaches welders and other workers to program and maintain robotic welding machines that it has designed with retraining in mind. The company makes its machines with touch-screens that resemble smartphone screens.
“We’re not sending welders out the door because we are automating,” Mr. Konarska said. “The skills are shifting, and those jobs are shifting.”
Written by: Austen Hufford, Reporter, for The Wall Street Journal.