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The marketplace in the United States has rarely seen such dichotomies. Today there are some 14 million unemployed and more underemployed. More than half of the unemployed have been without work for more than six months. Yet there is a mismatch between the skills of the unemployed and the needs of businesses. Economists call this structural unemployment. At the same time we have rarely seen such dramatic unemployment for younger men and women. Some attribute this to the high minimum wage enacted in recent years which is one of the many unintended consequence of well-meaning politicians.

In our Industry we continue to have difficulty hiring skills; technicians, parts employees, salesmen, technically skilled systems personnel and all levels of management and supervision. We seem to have developed an aversion to the internal development of employees. Rather we want someone else to pay for the training and we will steal them away after they are trained. Our actions seem to bear this out with the uncharacteristically low level of training being provided to the employees at dealerships. Since the Fall of 2001 after the infamous 9/11 attack I have never seen such low levels of participation in training. It truly is astounding. I grant you the progressive companies are continuing apace and reaping nice rewards from the results of having a skilled and currently trained workforce. But they are the exception. How is your participation in workforce development these days? Other than the mandated technical training for your mechanics that is required from your OEM how much time and money are you investing in training of your employees?

As of this writing, June 2011, economists say that there are at least 1.5 million unfilled job openings that can’t be filled due to the lack of necessary skills. That they say would put the unemployment rate at 8% rather than the 9.1% we are experiencing now. There are others that say there are 3 million jobs that can’t be filled due to structural unemployment. Further that 40% of American companies had jobs opened for more than six months that could not be filled.

This brings me closer to the point I want to make with you. Skills shortages are going to grow not abate as time goes by. This is caused in part by the changing educational situation. Months ago I exposed the liberal arts college education as failing the youth of today. Many of the current graduates leave school without many of the basic skills required in the work place. In fact the high schools pass this problem up the chain to the Universities such that the first year and in some cases the second year is remedial education that should have been covered in High School. For many skilled “Blue” collar jobs the high schools have de-emphasized vocational training, community colleges still need to be better connected to their communities to provide the necessary skills, union apprenticeships aren’t what they used to be with most union jobs now in the public sector. Companies traditionally provided a lot of training but that too seems to have changed. Companies fire employees more readily and employees are less loyal and leave to join other firms. This has led to the comment above that Companies today expect their prospective employees to come to the job trained and ready to go. Today many companies are back at profitability levels that allow them to breathe more easily. You would think that the time is long past that they would invest in developing their employees again. This is exactly the world that Peter Drucker predicted in the middle eighties.

In a recent Forbes magazine article focused on what was necessary to make your children rich was the comment that “we are spending our children’s money.” This is from the group that sees the continuing deficits as a serious cause of concern. An opinion shared today by most Americans. The theme in part is that you should not over educate your children. University and College education costs too much and is of modest impact. A Doctor who spends nearly eleven years longer in school emerges with a large debt and compared to a plumber does not make measurably more money over their lifetime; interesting comment isn’t it?

So let’s get back to Drucker. One of his many forecasts was that one of the fastest growing Industries in the 21st century was going to be adult education. I believe that we have arrived at that point. As the world changes and we become a “Services Dominant” economy we will have to provide higher skills to our customers in order to maintain their loyalty and their business. The defection rate reported in the Product Support Opportunities Handbook for “service department” customers was 15% per year. That produces a defection rate in five years of 48% of your customers. Something has to change doesn’t it?

But let’s not miss the point that we have moved from a “goods” dominated business world, in North America, to a “services” dominated world. In this world we have to discover our “core competencies,” the fundamental knowledge and expertise of our employees. Information use to insulate us from competition but with the arrival of the internet in the late sixties to the robust presence it represents today information is no longer ours alone.

We have to earn our customers business in different ways today and identify new customers would benefit from our skills and knowledge. This goes back to the wants and needs of customers and our internal excellence to satisfy those needs and wants.

This is the core of the “Balanced Scorecard” a technique developed in the middle nineties to enhance the success of companies implanting strategy. The success rate at strategy implementation was put at 10% of the companies in America. Pretty dismal results aren’t they?

All of this can change when business recognizes that the solutions to the skills deficit, the solution to the lack of success of hiring to fill openings and the loyalty obtained from employees and customers – all rests with the skills, knowledge and competencies of the employee. This is something that is in short supply, it is something that is a necessary component of your success, and it is something that you can develop.

So what are we to do? I believe you all know what you have to do. You have to develop a career path for each employee. You have to encourage the employee to learn. You have to invest in the competencies of your employees. You have to invest in the training and the tools and the technology that will service your employees and help them serve your customers. This is not some radical thought. It is common sense. Skilled people provide services to other people requiring those services in order to secure business. It is in the hands of the employee not the employer. It is in the hands of the employer to provide the best learning and work environment possible for talented and ambitious people. The rewards far outweigh the penalties. Are you ready to get started again?