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Re-tooling: Can our work force be retrained?

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Published: April 30, 2006

Going back to school at age 54 was an unsettling prospect for Joe Galyean. But the alternative was much scarier. Galyean, a former maintenance supervisor for Hamilton Beach/Proctor-Silex Inc. in Mount Airy, had his job cut in 2000 when the company moved production to Mexico to get lower labor costs.

"A lot of good, hard-working guys I worked with have had to take a job at much less pay," Galyean said. "Some are having to work at a convenience store or delivering pizzas to make ends meet."

Galyean, now 58, graduated from Surry Community College in May 2003 with an associate's degree in heating and air-conditioning technology.

"The first week in the classroom was very, very intimidating, especially when I could've been the grandfather to some of the students," he said. He adjusted well enough to become an academic ambassador at the college and make the dean's list.

Galyean was hired for a bank service-maintenance job in the Triad just three weeks after graduation by Trammell Crow Co., a real-estate management company based in Dallas.

"I could have taken some maintenance jobs without going back to school," Galyean said.

"But the jobs wouldn't have been as lucrative and I wouldn't have had time to build myself back up to my previous wage. At my age, I knew I really didn't have a choice without getting more education."

Associate-degree programs have taken a more prominent role at community colleges since North Carolina began hemorrhaging tens of thousands of manufacturing jobs in 2001.

The N.C. Community College System is pouring more money into the programs, which employment officials are promoting as a pathway to new-economy careers and middle-class wages for displaced workers.

But the effectiveness of the programs has been mixed.

Limited resources have created classroom bottlenecks for many of the more popular programs, such as biotechnology, pharmaceuticals and dental hygiene.

"Our nursing programs have significant opportunities for employment and great interest on the part of students who desire to enter this market," said Martin Lancaster, the president of the system.

"Unfortunately, we have waiting lists at some of our institutions of over 500 students who are qualified, but due to a lack of equipment, staff, facilities, we cannot accommodate the needs."

Students are drawn to many associate-degree programs because of projections that graduates will earn $40,000 or more a year in their new careers. But some programs, such as radiation therapists, are projected to have as few as 20 annual job openings statewide over the next six years.

A lack of post-high school education, especially for people who have worked for many years in the furniture, textiles and electronics industries, is a major hurdle. So is money for tuition and books.

The system said that it doesn't keep track of the success rate of displaced workers completing an associate degree and getting a job in a new field. But economists and employment officials said that as few as 20 percent of displaced workers nationally complete an associate degree.

"That 20-30 percent range could be right on target, but a lot depends on the individual worker and student," said Larry Keen, the vice president of economic and work-force training for the system.

"An associate degree is not for everyone. But we're having more success, especially with older students who already had a level of education beyond high school."

The system reported that spending on associate-degree programs swelled 63 percent from $251 million in fiscal year 2000-01 to $410 million in 2005-06. A closer look at the system's total budget shows that the percentage of money spent on associate degrees has increased from 31 percent to nearly 37 percent in that time.

The primary reason for the increased associate-degree budget is the establishment and operation of laboratories and other clinical operations requested by new-economy businesses.

Forsyth Technical Community College, for instance, opened a $1.1 million biotechnology building with 29 classrooms and labs in March. The building was paid for through a statewide $3 billion, higher-education bond referendum approved in 2000.

But employment officials said that it remains challenging to find the right mix between associate-degree programs and local job markets, especially for those industries that still are evolving.

For example, Debra Perret, a community affairs and grants specialist with Targacept Inc. in Winston-Salem, said that the local industry is three to five years away from absorbing the majority of Forsyth Tech biotech graduates.

Most community colleges offer continuing-education courses. But Keen, the college-system official, said that there is no formal program for keeping graduates' skills up to date.

That logistical shortfall has hampered Loren Meyer's attempt at landing gainful employment.

Meyer, of Westfield, earned first a bachelor's degree in philosophy from Hillsdale College in Hillsdale, Mich., and then an associate degree in information systems from Surry Community, according to his mother, Kathryn. Loren Meyer declined to comment for the article.

"I don't think Surry Community College did a bad job with my son," Kathryn Meyer said. "But he's struggling to get his foot in the door, and it would be nice if the people there had shown any concern as to whether he actually found work related to his degree, or had helped him to do so.

"I continue to think that this country is in much tougher condition, employment-wise, than most people who are fortunate enough to have good jobs realize."

Several studies show that taking courses at community colleges can enhance the future earnings of displaced workers more than the skills and training they bring from their previous job.

A 2001 study by The Harris School of the University of Chicago, which was released just as the nation's downturn in manufacturing was accelerating, found that "the equivalent of a year of schooling raised long-term earnings of displaced male and female workers by about 5 percent."

"Skills acquired from more technically oriented vocational and academic math and science courses have very large returns, whereas most other types of courses are associated with zero or sometimes negative returns," the report found.

Keen acknowledges that there are "a number of legitimate reasons why displaced workers don't attempt or complete an associate degree."

For example, the pressure to put food on the table, pay the bills or handle child care compels many potential associate-degree students to look for a job before more education.

Forsyth Tech's biotech program has had 16 graduates since spring 2004, with another 31 scheduled to graduate in May and 125 students enrolled. Lucas Shallua, the chairman of the biotech department, said that 13 of the 16 biotech-degree graduates have jobs.

An additional 10 students enrolled in the biotech program accepted job offers in the industry and chose not to complete their degree. Shallua said that it's hard to say whether those students shortchanged themselves by not completing their associate degree.

"Some students may have already had other degrees in computer, management or administration and a job was a higher priority than another degree," Shallua said. "Some received offers they could not resist given their obligations such as kids, unemployed spouse, a mortgage."

Another major obstacle for many displaced workers is a lack of education.

A study by the N.C. Employment Security Commission found that 45 percent of the employees laid off in the collapse of Pillowtex Corp. in 2003 had less than a high-school diploma. In many cases, employees needed up to 18 months to earn a GED, leaving limited financing from federal or state sources to pursue further education.

"In most cases, the displaced workers take advantage of the continuing-education short courses that may range from basic literacy skills to more sophisticated training that results in certification," Lancaster said. "Still, it is the students' interest, dedication and willingness to adapt to the demands of the workplace that may determine their marketability and prospects for employment."

John Quinterno, a research associate for the N.C. Budget & Tax Center in Raleigh, said that he understands the financial dilemma of displaced workers when they choose to abandon an associate-degree program.

"Short-term and vocational courses are likely more affordable than associate degrees, especially since you can't get financial aid if you are enrolled less than half-time," Quinterno said.

The cost of obtaining an associate degree can be another major hurdle.

For a full-time student living in North Carolina, the cost tops out at about $1,420 a year, according to the college system. The in-state cost of attending an N.C. community college is about half the national average, but still has increased about 65 percent since 1994, according to the Southern Regional Education Board.

The typical displaced worker receives two years of benefits from the U.S. Trade Adjustment Assistance Act, which provides benefits to people whose jobs were eliminated because of foreign trade. Keen said that the majority of associate-degree students run out of trade-adjustment benefits before graduating.

"Our students are adults with adult responsibilities," said Audrey Bailey, a spokeswoman for the college system. "We also know that most students don't complete a two-year degree in two years - just like most students don't get a baccalaureate degree in four."

Angela Hobson, a student at Forsyth Tech, is on course to graduate in May with an associate degree in dental hygiene. US Airways Group Inc. cut Hobson's job as a special-pricing analyst in December 2002.

According to the N.C. Employment Security Commission, dental hygienists have the most predicted job growth for associate-degree graduates between 2002 and 2012. The Forsyth Tech program typically receives more than 100 applicants each year for fewer than 20 slots.

Hobson receives benefits from the Workforce Investment Act through the Northwest Workforce Development program, which made it possible for her to pursue a new career.

"If I had to go to work and pull a full course load, I doubt I could have done it," Hobson said. "We're still having to watch our expenses, putting off a new car. I've had little time for myself the past three years, and it's required a lot of self-discipline.

"But I feel like I'll be making about the same as I did as US Airways starting out, plus I'll have the satisfaction of helping people with their smiles."

Lancaster, the president of the community-college system, said that associate-degree graduates have to be flexible because being geographically bound can limit significantly their job options, especially in emerging industries such as biotechnology.

Keen stresses that the advice to pursue an associate degree "remains good."

"The more associate-degree graduates we have, the larger and more attractive the state's work force becomes, especially to those companies considering coming to North Carolina," Keen said.

"The beauty of our system is that students are able to be employed faster due to the refining of skills they possess and those they gain through retraining and the classroom. No other system of which I am aware does the job so consistently as the community-college system."

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