The United States and other nations around the world are not producing enough workers with the skills needed for employment is today's high-tech global economy. Many STEM occupations are now vital to a broad range of industries and professions, thus placing different economic sectors in competition for people with in-demand skill sets.

The media's continuing fixation on the Federal Reserve's monetary medicine for unemployment obscures the growing uncomfortable reality that monetary/fiscal policy alone cannot fix the structural failures of the ossified U.S. education-to-employment system. Washington leaders inside the beltway and people across America are just starting to understand this new reality as the skilled workforce crisis deepens.

SOUTH DAKOTA INITIATIVES

The scope of the skills–jobs mismatch is well illustrated by what I learned recently when I spoke at conferences in Watertown and Brookings, South Dakota. They were two of the six regional “Governor's Workforce Summits” being held across the state. South Dakota has a very low unemployment rate (3.8% in June) with about 17,000 people unemployed while there are slightly more than 13,000 jobs vacant throughout the state. With a population of about 1 million people, skill deficits are beginning to create growth problems for many business sectors. Governor Dennis Daugaard said, “We need skilled workers to come or return to South Dakota because a serious skills gap is growing throughout our state.” Health care is an area of particular concern because South Dakota will need 8000 additional workers in this sector by 2020.

To address the skills–jobs disconnect, the state has launched South Dakota Workforce Initiatives or SDWINS, a multifaceted skills development program. In addition to encouraging the return of people who have left the state, this initiative includes: Offering companies state partnership programs for training new and existing employees; as well as expanding apprenticeship education, English-as-a-Second Language instruction, technical training programs at local educational institutions, and the use of the National Career Readiness Certificate.

South Dakota also has instituted career information and education programs to better prepare youth for emerging career opportunities. Through its online information platform, www.sdmylife.com, students see how their interests and skills match real-life careers, learn about postsecondary education and training options for specific careers, and can locate internship positions in South Dakota business and organizations.

These initiatives have been implemented because an increasing number of South Dakota companies across all business sectors need to recruit workers with higher skill levels. Such jobs required specialized knowledge and application skills and often extensive experience.

SKILLS GAP GROWS NATIONWIDE

The Federal Reserve's “Beige Book” economic survey of May 2014, “The Accenture 2014 Manufacturing Skills and Training Study,” the National Federation of Independent Businesses July economic survey, and the Conference Board's Help Wanted June Online Data Series are among the many employment indicators confirming that a nationwide talent crisis is in full bloom.

Across the United States, the declining unemployment rate has not resulted in bringing a surge of workers back into the workforce. Instead the labor participation rate in May 2014 was 62.8%, a 35-year low. Over 92 million American adults are not currently part of the U.S. workforce including: Workers whose jobs have been automated, sequencing mothers, full-time college students, retirees, challenged workers, people emerging from the criminal justice system, and the longest-term unemployed.

News services are just beginning to raise red flags with headlines such as: “‘Terrifying’ Oil Skills Shortage Delays Project,” and “Global Giants Face a Fight to Lure Local Talent,” (Financial Times, July 17, 2014). They are also beginning to ask uncomfortable questions, like “Just Whose Job Is It to Train Workers,” (Wall Street Journal, July 17, 2014).

It's time for American society to face up to the radical shift in the skills demanded in today's high-tech global economy. That translates into understanding that life in the 21^st century requires our culture to focus on people acquiring more knowledge and skills over their entire lifetime, not only as students in school, but also in lifelong learning. Employers need to inform educational institutions about the knowledge and skills required for in-demand jobs and careers and cooperate in developing educational programs for these jobs. Parents and students need information on career opportunities in their region and the education and training needed to prepare for them.

In Seattle, companies, such as Amazon and Boeing, have either started or expanded job training programs. They have reached the conclusion that there is no longer a sizable amount of slack in the worldwide STEM workforce. Some of these companies have also brought 3000 top-level STEM students to Seattle for summer internships in which transportation, lodging at corporate housing or hotels, and often food expenses are covered.

RETAINS FOCUS REGIONAL TALENT DELIVERY

However, many more employers across the United States need to increase the training and development expenditures that they so drastically cut during the recession. Surveys show that employee loyalty is significantly increased when employees are provided with opportunities to acquire the latest skills relevant to their careers and their industry.

While in Watertown and Brookings, South Dakota, I saw how difficulties in recruiting skilled labor are affecting their economies. Both have low unemployment rates, and vacant positions are rising. The re-shoring of jobs to America from overseas offers these communities new opportunities to diversify their economies, but the local availability of skilled technical/professional workers is a major factor in attracting new employers to an area. My programs in these communities enabled the business, education, and government leaders to acquire a clear understanding of how Regional Talent Innovation Networks (RETAINs), which are a major focus of my latest book, Future Jobs: Solving the Employment and Skills Crisis, can help their local communities focus on the cultural change process needed for rebuilding the regional talent-delivery system.

During the past decade, about 1000 RETAINs have been formed across the United States to act as intermediaries focused on building larger talent-creation networks. RETAINs are nonprofit organizations that form public/private partnerships between business, educational institutions, government agencies, and nonprofit community organizations. RETAINs facilitate constructive dialogue that breaks down isolating silos to end local turf battles. They are now helping their local communities better integrate new regional talent-delivery systems into a broader vision of a prosperous 21^st-century economy for everyone.

“The skills gap is not a fabricated dilemma, it is very real,” asserts Bill Path, president of the Oklahoma State University Institute of Technology. “And it is only going to get worse if we do not take it seriously and address it…. Like two mighty oars working as one, the public sector and the private sector must pull together to affect real change and to put our U.S. labor force back on a proper course for job success.”