The governor is promoting new strategies to enhance the strength of South Dakota's workforce, but not everyone thinks the state should be active in connecting job seekers with employers. This week Governor Dennis Daugaard revealed findings from South Dakota Wins workforce summits, and he lays out a plan for the state to strengthen South Dakota’s workers and businesses.
Secretary Marcia Hultman leads the South Dakota Department of Labor and Regulation. She says it’s time for the state to help businesses fill openings with skilled workers.
"The ‘why now?’ is because there are immediate needs for workers in the state, that employers across the state with a wide variety of different types of job openings are looking for employees with the skill sets needed, so that’s why now is the time, because there’s an immediate need," Hultman says.
That immediate need is apparent, according to Governor Dennis Daugaard. He gives the need for qualified welders, accountants, health care workers and IT professionals as examples. The governor has five main steps he says the state is taking to promote workforce development. His plan includes streamlining the words job seekers and employers use to better match the right people with the right positions. He’s says that starts with the Department of Labor.
"We need to make sure we’re using all the available workforce that we have, and we talked about how sometimes the skill sets don’t match up with job openings, but sometimes there are matches but they’re missed because we’re using poor language to describe what the opportunities are and understanding what the skill sets that are available are," Daugaard says.
"Markets work better than politicians at deciding what wages should be, what prices should be, what quantities should be," Robert Wright, Nef Family Chair of Political Economy at Augustana College, says. "Now on the other hand, the governor is saying ‘Oh, but the state has to get involved with matching employers with employees by mandating what language they use.’ Where is that coming from? This is a form of central planning, essentially. What is it about the market that prevents employers and employees, all of the sudden, from communicating with each other?"
Wright says his research into thousands of years of entrepreneurship on the Great Plains shows no state has needed to step in and connect workers with business needs. says the market takes care of itself. He says companies can find workers on their own, but that sometimes means voluntarily raising wages or increasing benefits.
Wright says the idea that private industry can tackle workforce development without outside help extends to another of Governor Dennis Daugaard's steps.
"'Make real-time labor supply and demand data available.' That sounds fantastic for a business to set up," Wright says. "If there's an actual need for that, why can't an entrepreneur do that?"
Wright says that's part of the cost of doing business. He says the state's decision to match workers and job openings really benefits companies, because they don't have to spend the money to find qualified employees. The state does. He says the same is true for identifying and targeting new populations likely to move to South Dakota.
Governor Dennis Daugaard says education community members and people in business need to communicate so schools can graduate students prepared for their careers.
"Here the report has strategies to focus our education programs and offerings on skills and capacities the job market needs," Daugaard says. "One approach is to use industry-recognized certifications like the National Career Readiness Certificate. We need to make sure that the curricula and our training education programs are really business-driven."
The notion of education guided by business doesn’t sit well with economist Robert Wright. He says he worries leaders are mixing up the concept of training people for specific jobs with educating them for life-long career success.
"So you have a job, but do you have the skills to turn that job into a career? What happens if a supervisory position opens up, and you’re the welder or you’re the operative, and they go to you and you can’t string two sentences together? Well, you don’t become foreman. You remain the operative," Wright says.
Wright says that means the wage a worker finds adequate at first can become wildly insufficient as the person’s life changes and families grow. He says it’s a misstep to provide people with tools for specific positions instead of broader education and that could lead to massive unemployment in a decade or two as industries change and jobs become obsolete.
Another move Governor Dennis Daugaard says can help the state’s workforce is a partnership with communities trying to fill their own needs. The governor says he's making $1 million from the Future Fund available to match community efforts in workforce development.
"Often times they're used to train new workers who come into town. They're sometimes offered as extra grants to new employers to expand or move to South Dakota. But Future Funds are limited to two things: research and economic development," Daugaard says. "And I don't know how you can say workforce development isn't economic development. It's very clearly the highest challenge we face in the business community."
Daugaard says the plans need to include community partners in education, business and government to qualify for a match in state funding. Economics professor Robert Wright says he doesn’t think the state should step in to develop workforce, but he doesn’t mind communities taking on that task. He says they better know the needs and lack immense resources to control too much of the market.
The final portion in Governor Dennis Daugaard’s five-part state plan includes utilizing the Workforce Development Council to continue state and local collaboration. Economics professor Robert Wright says he wants to see the state support communities, rather than partner in their efforts.
You can view the report online, including slides from Governor Daugaard's presentation.