Southern Oregon manufacturers, like the rest of the nation, struggle to fill key positions.
John Underwood is looking for three good men. Or women. Or anyone, really, as long as they are an electrician certified to work in Oregon. “I’ve been searching for over a year to fill these positions,” laments the human resources manager for Timber Products Company in Medford.
Underwood is not alone. The entire region is searching for skilled, blue-collar labor. He estimates that over the next 12 months, the Rogue Valley could absorb about 20 more electricians, along with 30 millwrights.
It’s not just a Southern Oregon problem but a familiar story being retold across the country. Nationwide 51,000 manufacturing job openings went unfilled in October alone, reports CNN Money. But Oregon’s Rogue Valley, home to 430 different manufacturing companies, is feeling the employment pinch particularly hard.
Jessica Gomez, founder, president and CEO of Rogue Valley Microdevices, points to the valley’s rural location and diverse set of needs as key reasons for the pinch.
“I would say workforce is the No. 1 cause of angst right now,” she says, replacing another familiar worry: access to capital. “Five years ago, companies would say: ‘No bank would talk to me.’ Now it’s: ‘All I need are those key three people. I can’t find them, but I have the ability to pay them.”’
And there’s the disconnect. Oregonians decry the loss of skilled, blue-collar jobs and the good wages they provide, while the sector scrambles to find — and pay — skilled, blue-collar employees. The problem threatens to get worse as experienced workers age out and retire.
Yet the trend takes no one by surprise. Manufacturing employment numbers had been on a long decline before the great recession threw them over a cliff. Advances in technology reshaped the work left behind.
Today the sector does more with less, requiring fewer but more highly specialized workers. It’s this emerging third category of employee — not academic, not blue collar, but a hybrid skilled, blue-collar worker — that remains elusive.
The state tried to address the coming problem in 2011 by adopting the 40-40-20 education goal. Ambitious for sure, the goal calls for 40% of 25- to 64-year-olds to have a bachelor’s degree or higher, 40% to earn an associate’s degree or certificate and 20% to complete high school by 2025. Six years later, the goal feels more aspirational than achievable: The numbers are 31-17-42, with about 10% not even graduating high school.
Still, to Rogue Workforce Partnership executive director Jim Fong, the entire approach misses the mark.
“We’ve oversold the value of a four-year college degree,” he says.
The irony is also clear to political advisor and past president of the Oregon AFL-CIO, Tim Nesbitt. In a recent Oregonian editorial, Nesbitt compared two letters sent to high school seniors this past March. One was from a traditional four-year college touting their “affordable” loan programs; the other from the Albany Chamber of Commerce, offering students a debt-free track to good-paying careers through their Pipeline program.
The program — which unites students, educators and local businesses to offer on-the-job training and specialized community college courses — has opened eyes in other parts of the state.
Southern Oregon companies, partnering with the Rogue Workforce Partnership, are attempting the Pipeline approach: direct outreach to young adults to meet their staffing needs before they go to college. It’s a long-term solution, according to Underwood, with results expected in eight to 10 years. Will it be enough or too little too late?
Oregon’s Rogue Valley is unique. Rugged and appealing, the location — halfway between San Francisco and Portland — offered a low-cost, low-risk place for Adam Cuppy and his partners to bootstrap Zeal, their custom software company. The site is remote, but the partners never felt alone.
“There are a lot of hungry technologists in the area,” Cuppy says, noting a surprisingly large e-commerce sector and a growing community of individual coders working remotely.
Cuppy took the opportunity to create synergy. Zeal’s Medford headquarters is a whopping 47,000 square feet, too big for its eight on-site employees. Most of the space serves as “a beacon for the community,” in Cuppy’s words, where “friends of Zeal are invited to come in, co-work and be around other software writers.”
Four-year-old Zeal logged $2 million in gross sales in 2016, representing 30% growth year over year. It currently employs 15, with a short-term target of hiring 10 more. Filling those jobs will be a challenge, but as a distributed company — with workers in Medford, Portland, New Hampshire, San Diego and Hawaii — the task may be easier for them.
The company is also committed to home-growing talent. For the past 18 months, two Zeal partners, Sean Culver and Trever Yarrish, have taught software development at Rogue Community College, making the curriculum more hands-on and project driven.
Cuppy reports that the energy his partners inject into the classes has had an effect, with attrition dropping from 50% to 0. Graduates leave with enough training and experience to qualify for an entry-level position.
Zeal’s advanced manufacturing neighbors, however, walk a harder path. Norman Kester, president of Quantum Innovations, tells of passing up business opportunities because he lacks the necessary staff. “We should be about twice as big,” Kester admits about his 50-employee operation.
He moved to the Rogue Valley in 2002 to be closer to his in-laws and started Quantum Innovations, a high-tech manufacturer that serves the optometry industry, in his garage. Sales grew from $400,000 to between $10 million and $15 million today. “The pace is right for the area but slow for the industry.”
The jobs Kester wants to fill — electronic engineer, thin film and vacuum sciences and solid works/mech engineer — pay well, between $40,000 to $85,000.
These positions sound like they require a bachelor’s degree or more. “They don’t,” says Kester. “It would be great if the person had that, but in most cases, we’re teaching it.” Training lasts between six months and two years.
The shallow job pool has Shawn Hogan, vice president of engineering and operations for Linx Technologies, taking chances on people who may not fit the job description on paper but have“the right mix of culture, talents, initiative, judgment and chutzpah.” Results are mixed.
Their intern program, with a low bar of entry, is about “20% successful,” he reports.
Medford has the seventh most robust technology economy in the U.S. for a city its size according to Fong. The diversity of the 430 manufacturing companies, 60 of which employ 10 people or less, is part of the problem, as the skill sets required differ depending on the employer.
“We’re still young,” explains Gomez, “not very deep but a mile wide.”
Some companies are using that intimacy to their advantage. Linx’s Hogan will cherry pick promising college students before they graduate, hiring and offering them signing bonuses in their junior or senior year. Another exceptional student, a high-school valedictorian who planned to leave the valley, was snapped up his sophomore year.
“We try to find the jewels and figure out how to keep them,” Hogan says.
Partnerships between business, K-12 schools and Rogue Community College hope to further fill the pipeline, creating, in essence, a “farm team” of middle-skill workers. The process requires an intense, hands-on approach.
For instance, helping a high school junior get a certification means coordinating early-release days with the community college class offerings and providing bus transportation.
“We really have to get into the weeds,” says Underwood.
There also needs to be an awareness shift at the state level. In the last 20 years, K-12 schools have moved away from career technical education (CTE) to push college prep. It made sense as we moved into the Information Age.
But it turns out the Information Age needs journeymen coders and certified technicians who can work with programmable logic controls and human/machine interfaces — as much as or perhaps more than it needs pure software Mark Zuckerberg types.
There is some positive movement to report: Three pieces of CTE legislation passed in 2015. Gov. Brown has telegraphed further interest in improving these services in a December letter to the Oregon Workforce Investment Board. These actions, however, do nothing for recent college graduates drowning in debt.
“We’ve done a disservice to our youth,” laments Hogan. As someone who started on the high school CTE track and used it to leverage a more academic path, he’s lived both sides of the coin. “We’ve put too much emphasis on one side and not enough balance on the other.”