Sunday, April 6, 2014

Suddenly, It's Not About Workforce DEVELOPMENT, Gov. Daugaard. It's About Workforce RETENTION.

     The worker shortage in South Dakota that caused Governor Daugaard to cast "workforce development" as one of his top priorities in January just got a bit more acute.  Today's Rapid City Journal notes that the gloves have come off in the chase for construction workers in the area, with North Dakota making aggressive efforts at copping South Dakotans for work in their surging oil boom counties.  Job fairs sponsored by a coalition of ND labor unions will soon be held in Sioux Falls, Aberdeen, Pierre and Rapid City.  The competition will be brutal from South Dakota's perspective.  The RCJ notes that industry wide, construction jobs in ND pay 20% more than their counterparts in SD. A laborer up north makes $3/hr more than a laborer here in SD.  Something tells me those job fairs will have some success in luring workers away from their homes in South Dakota.  Of most concern should be the potential loss of those younger workers, many of whom probably have yet to put down family and career roots.  Getting situated early on in North Dakota runs the risk--a probability in my view--of losing them forever.
     I think at this point the Governor should concern himself less with developing a workforce, more with holding on to the one we have.  Considering that we're already in last place when it comes to median wages in this region, this will be a challenge.  Actually, it will be more like a Herculean task. True, competing for workers with North Dakota will trigger a private sector supply/demand reaction which would have the effect of raising wages here.  And to some extent, letting the free market do its thing has a nice laissez-faire quality to it, one that suits Republicans by nature and philosophy.  But we don't live in a laissez-faire world, a fact as much attested to by Daugaard's commitment of tens of millions of dollars to economic development via the Building South Dakota initiative, as by the existence of the Governor's Office of Economic Development itself.  The conundrum, of course, is that you can't go into "building South Dakota" mode without some workers doing the actual building.
     And you can't keep workers here by paying them lousy wages.  I noted a few posts ago that there's a noticeable migration of South Dakota technical school grads to other states. Southeast Tech in Sioux Falls sees an out-migration of nearly a third of its grads, likely to greener pastures in nearby Minnesota and Iowa, where wages are substantially higher than in South Dakota.  This raid by North Dakota seems like a natural development, everything considered.  And while it's true that Governor Daugaard can't raise wages in the state by anything like an executive order, some initiatives from Pierre could make us more competitive.
     Unequivocally supporting a raise in minimum wages could create a "bottom-up" force in raising wages generally.  Along with that, a serious commitment to increasing salaries for the state's teachers would likely convince some people that rearing their children here would give them access to some of the best teachers in the region.  That we're in a "teacher crisis" situation was even picked up by the conservative Washington Times a few weeks ago.  When the right-wingers at WT notice that South Dakota isn't spending enough on teachers, our generally conservative elected officials here should take note.  We're an embarrassment among conservatives around the country.  Get that?  Conservative circles are even noticing how cheap we are when it comes to paying teachers.
     I'd say lousy wages and poorly paid teachers are a deadly combo when it comes to retaining, much less developing, our workforce.  Is there a solution?  Yes.  Kick wages up and pay teachers more money.
   
   
   
 

11 comments:

  1. I just looked at Western Dakota Vo-Tech web site and they claim 96% have jobs and 90% stay in South Dakota. The vo-tech has a lot of programs, I was surprised. I was on an advisory committee many years ago and haven't been connected since. Why don't these students look to North Dakota or Wyoming for construction trade jobs? They would have the skills. My personal thought is these kids have been raised here and have heard we are a low wage state for their entire life and are afraid to raise themselves up. It is like reverse peer pressure. My friends are staying and starving. If I go I will have money and they won't be my friends anymore. Why does the vo-tech in Sioux Falls have such a rate of graduates leaving the state and Rapid City have a 90% rate of staying in the state. Probably that 10% came from out of state to go to school. I do agree with your premise that the state needs to lead the way to higher wages, but the workers have to rebel also. They can't be so complacent.
    It is kind of like the definition stupidity - Voting for the same people over and over and expecting a different result.

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    1. Dallis, if you check my link in the 3rd paragraph ("noticeable migration"), you'll see at overall placements in SD for the technical institutes combined is about 75%. WDTI is about 85% (maybe they're rounding up?) and Southeast is about 65%. My guess about Southeast in Sioux Falls is that it is so close to IA and MN and it's easy to jump over the border for a better paying job and still be in shouting range of Sioux Falls. Out here the situation is similar for teachers. I know several younger ones who live in the Black Hills and commute to work over the border in WY for much better money. Daugaard acknowledges the problem by constantly talking about workforce development, so he at least gives lip service to the state being able to do something. I'm pretty sure this North Dakota deal will be something of a wake-up call

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  2. But John, just this session the legislature couldn't even agree to a resolution that we have a teacher problem, and that $225 A YEAR extra they gave teachers was an insult. Daugaard is way to proud of his business friendly policy to abandon it for something silly like a living wage.

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    1. Tim, this is why I think the raid from North Dakota may prove to be a wake-up call. Brazen as it is, it will get some attention. The head-in-the-sand gambit will only work so long with respect to teachers. Daugaard really has to address this at some point. I actually often wonder how it must feel to be the governor of the state that has the lowest teacher's salaries in the country. We can only hope he's paying attention.

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  3. Thanks for focusing attention on this John. I think the most immediate steps we can take would be to (as you say) l) raise the minimum wage, 2) help the low wage workers by expanding Medicaid, providing them a great new benefit and also making them healthier and more productive, 3) setting a better example as a state government at the lower end of the wage scale, where we pay pathetic wages to people doing tough jobs like guarding prisons, running snow plows and fighting fires, and 4) making tech school and college more affordable, esp. for youth from low income families. All these are affordable and doable today.

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    1. Thanks, anonymous. Sometimes I think I'm just calling attention to the obvious. All in all, your list conforms with my belief that economic development should take a bottom-up, not a top-down, approach. Creating a well-educated, healthy and fairly compensated population should be priority number one. Appreciate the comments.

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  4. This is an important problem. I appreciate the astute analysis and solutions offered. I'm thinking about the question of why more West River students don't leave.

    I think part of it is due to a greater sense of isolation. The spaces there lead to an impression that one needs not be concerned with the rest of the country. What does it matter to a ranch family in Faith or Hot Springs what the government is doing?

    Isolation works the same anywhere, but it's awfully difficult to pull off in more populous places. Sioux Falls has more in and out migration. It's only 3 1/2 hours to Minneapolis and 4 to Kansas City.

    Then there is the "special" attitude, which seems more prevalent outside of Sioux Falls. I've heard it many, many times, and I know lots of folks can say the same. "We're special because we have a strong work, family, fiscal, moral ethic. We take care of ourselves, we're independent, we're not like those big city/East Coast/West Coast people. . . "

    I see that attitude as a defense against our bottom-of-the-barrel rankings.

    The remedies suggested by John and Anonymous will help provide tangible evidence that South Dakotans are valuable and deserve to be treated as such.

    Could it be time for a South Dakota Revolution!?!

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    1. Well, Deb, when the word "crisis" gets applied to South Dakota's shortagage of teachers and "workforce development" makes the top of the list of Governor Daugaard's priorities, you'd have to conclude that it's time get something done. The "revolution" you ask about will probably come in the form of more forceful action and attention by our elected officials, which in its way would be revolutionary indeed.

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  5. Just read the article online in the RC Journal about teen drinking. It cites we as South Dakota have the second highest number of teen drinking. I wonder do you think this is a product of a low wage state? A feeling of no way out, hopelessness.

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  6. I’m impressed, I must say. Really rarely do I encounter a blog that’s both educative and informative. So i am come back again and again. minimum wage by state Fair labor standard act is working for United state Federal and local law relating labor standards and to help all employer their right and law under role of law. All worker can be conscious about any kind of the labor law to read http://flsa.net/

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    1. Thanks, Ms. Justin. On an earlier piece related to this, one of the commenters noted that South Dakota's workforce could do more to take the initiative when it comes to getting better wages. As a right-to-work state, SD isn't the most favorable climate for unionization. However, there probably could be more done to make workers a significant political force. The information is out there, as you note. I appreciate your kind remarks.

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