Interview with Hope Street Group Network Member Ryan Costella, Director of Strategic Initiatives at Click Bond
Conducted by Chimdi Ihezie on July 24, 2014
How would you describe the “skills gap” in your area? When did you first start to notice it, and what spurred you to get involved to change it?
Nevada is a tough state, mostly because we were so reliant on gaming revenues for decades. When the recession hit, the tourists stopped coming to town, so all of a sudden a bunch of people were unemployed who were in the casinos. The problem with that was a lot of the casino workers weren’t particularly skilled or educated—they didn’t have to be. You had this massive group of people who were unemployed who didn’t necessarily have the skills to connect to the places that were hiring. That was one natural challenge that existed in Nevada.
In terms of Click Bond, in our position as an aerospace supplier, about five years ago, we started looking to the future, thinking about planning and next-generation workforce issues, and really starting to assess, “If we grow the way we think we’re going to grow, where are we going to find qualified people?” Frankly, when you look at who is coming out of the education system and who is available in the workforce system, we realized it really wasn’t looking too good. As I said, with the unemployed population, you’re dealing with a pretty unskilled group of people and I don’t think it’s any secret that Nevada’s education system is hugely lacking, I think we’re now 50th in the country. We looked at that and said, “We probably have to fix this and take an active role in creating something that’s different and raising the bar here, or we’re not going to be able grow and do business.”
So we got involved heavily with the National Association of Manufacturers, who has been paying attention to this issue for probably the better part of two decades, through their Manufacturing Institute, which I know you guys are familiar with. We just started trying to understand the nature of the problem on the national level, which was certainly aligned with what we were seeing in Nevada. We really just said, “Nevada’s a pretty small state and we’ve got really strong relationships with the different stakeholders on this issue.” So we pulled together, literally four or five years ago, a meeting of top stakeholders. We pulled in the head of economic development for the state, the head of workforce development for the state, the head of the Nevada Manufacturers Association, people from higher education, including a couple of community college presidents as well as K‑12 superintendents. We had the top-level decision makers, at least in our locale, to talk about this issue. What we walked away with was an agreement that all of us have to work together, in concert and consistently, to try to fix this issue. That enabled us to really start building some momentum behind not pointing fingers, blaming the education system, or being upset with the folks in unemployment, and instead asking, “What can we do to fix it?”
We realized there were a couple of things at work. First of all, we have a perception issue, particularly in manufacturing. People don’t want their kids to go into our sector because they think it means dirty, smokestack, minimum wage jobs. The reality, as I’m sure you guys have learned, it couldn’t be farther from the truth. But we still have to change perception, which isn’t always accurate, but it’s real. So that was one piece. The second piece is we have this unemployed population that’s really underskilled and we have to address that problem. At the time, I think we had about 160‑170,000 people on unemployment, the vast majority of whom probably couldn’t go to work in any kind of skilled environment. That’s a reality we have to deal with. And then, in addition to the perception issue and the unemployed issue, the population coming out of K-12 isn’t really qualified; they haven’t mastered the basics of reading, writing, math, and problem solving. In fact, there were some pretty startling statistics that came out of a study that was done by a task force convened by the Governor several years ago to examine the realities facing community colleges. They found that, of students who passed all of their requirements in high school, in terms of attending classes and passing the proficiency exam, 56% of those kids were actually not proficient in reading and math, basically the foundational skills to function at a higher education level without remediation. In other words, of the half that actually finished high school in the state, (half of them dropped out or didn’t finish), 56% of them couldn’t do the basics. Those 56% are either trying to go to college and are requiring two years of remediation—25% of community college resources go to remediation—or they’re trying to come to Click Bond and work and we can’t give them a job because they can barely fill out an application.
Given the comprehensive nature of the problem, how do we start working to fix it? Well, we worked district by district. We’ve tried to set clear expectations from where we sit as employers. Rather than saying, “Well, we need these skills and you guys aren’t doing it,” we’ve really tried to say, “Here are credentials, national-level credentials, that the Manufacturing Institute has vetted. Here are the thresholds people need to achieve because they give us a very high degree of confidence that they can work for us one day one and not require remediation or basic foundational training.” The very lowest level of that equation is that National Career Readiness Certificate by ACT. That kind of credential for entry-level jobs is the ideal benchmark for whether or not someone can come work. Incidentally, we also spend a lot of time convincing our higher education partners, especially the community college folks, that if someone comes into community college with a National Career Readiness Certificate, the likelihood that they’re going to need remediation is much lower. If both sides of this equation, the go-to-work side and the go-to-college side, actually embrace a common standard, then we can start sorting through folks and connecting employers to people who have the skills to work and letting folks in the door for higher education who actually have the skills to start climbing that ladder. That was largely successful and we’re still making a lot of progress with that.
Almost two years ago, you were interviewed for 60 Minutes about the skills gap in manufacturing and how it has been exacerbated, in part, due to a lack of “soft skills.” What changes have you seen in Nevada and the larger economy since that time?
Well, in terms of the program’s setup, we’re seeing really strong performance from the folks that we hired out of the program that was highlighted on 60 Minutes. We hired four machine operators and all of them have turned out to be fantastic additions to our team and they’re climbing the career ladder really well. Our manufacturing manager indicated that they’re some of the best employees he’s ever seen. That was a really strong indicator for us as a company. Beyond that, the state built an infrastructure where we can actually use the National Career Readiness Certificate as a screening tool for our employees. When someone comes into Click Bond’s door and wants to apply for a job, we’re now in a position where, for almost any job, we can say, “Do you have a National Career Readiness Certificate?” Most people will have no idea what that is, but then we can say, “Well, go down to the local workforce center or go over to the community college; they are equipped to test you for this. Bring back your score and we can consider you for a job.” That’s the kind of great screening tool—before we invest any kind of money or resources interviewing somebody or bringing them on for 90 days to test them out, we’re actually getting a much stronger pull of people and that increases the likelihood that they’ll become a long-term employee. So that’s a huge gain for us.
We’re also seeing a lot more employers, especially in manufacturing, embrace credentials. The Manufacturing Sector Council for the state, which was sanctioned by the governor, has endorsed the entire skills certification system that NAM has put out. I’m actually the chair of that, all of the members of that have endorsed the skills certification system and are working on channeling Workforce Investment Act dollars to programs that result in those credentials. These are all huge improvements that we didn’t even think of two years ago. I would say we’ve made pretty great strides.
Hope Street Group recently published the report, Missing Makers: How to Rebuild America’s Manufacturing Workforce, where we examine how employers, educators, and community leaders can all work together to strengthen the industry. As someone in the manufacturing field, what encouraging examples have you seen of different sectors working together to expand economic opportunity and how would you like to see these relationships grow in the future?
I think the one major improvement we’ve seen from five years ago to today … I would say five years ago, the relationship between the workforce system and the education system and manufacturers was downright hostile. There was a lot of finger-pointing, a lot of blaming, “You’re not producing what we want, et cetera.” I think what we’ve achieved in five years was saying, “No, we as manufacturers need to look in the mirror and we need to take ownership of defining what our needs are and proactively meeting the education system or the workforce system where it is and trying to come up with proactive ways to get us to a common place.” Our interests are very similar. The workforce system wants to put people to work; we have jobs. The education system wants to graduate kids and even some adults who have futures and want to make a living; we have jobs that can provide. It’s actually very similar and once we were able to put our egos down a little bit, we were able to start rolling in the same direction.
On the K-12 side, we’ve spent a lot of time, on the statewide level through the Department of Education, educating them that these concepts of career-ready versus college-ready are really one and the same. We don’t want someone coming to work for us who couldn’t get into college and take classes. In fact, in one’s career, whether you start in a job and go on to college or start in college and go on to a career, the foundational skillsets are really identical and so the state has really moved to a position of embracing college and career readiness as one definition. I’m really happy to say that we’ve made a tremendous amount of progress in getting the National Career Readiness Certificate embedded into, potentially, the exit exams for high school. So while it’s not required for all students, its going to be an option for most of them if they ask for it and a lot of the career and education tech kids are also going to be taking that exam. It’s a lot of bureaucracy and a lot of work but we’re making major progress in K-12.
On the employer side, one of the challenges of manufacturing, noted in the report, is we are not social animals by nature. We tend to just want to keep to ourselves and most manufacturers are just trying to make payroll by Friday. They’re not thinking about things proactively and getting folks to step up and pay attention to this is really challenging. We’ve really tried to start educating ourselves about the power of credentials so that when folks demand the proper credentials, it aligns them with the folks who are going through the proper education channels and it really does get to that skills gap issue. And it creates a demand that justifies the state workforce system and the state education system aligning their resources to meet that need. The nice part about Nevada is it’s small enough that I think in a relatively short amount of time, we’ve got everyone moving in the same direction. It’s not perfect, but we’ve made huge gains. I think in the several years, it’s going to result in a game-changing scenario for the state, where we actually have quite a strong workforce.
As far as other sectors go, in Nevada we have the Sector Council. There are nine or ten different sectors that are operating in our state and that is one of the things we’ve seen after we evaluated the foundational skills of the manufacturing sector, basically the Skills Certification System that NAM produced. We’ve actually had one convening of all of the Sector Council chairs and vice-chairs and we’re about to have another one this fall. One of the major goals of that is to really talk about those most fundamental, foundational skills that we have in manufacturing. I’m very confident that the national data shows that the same foundational skills are necessary in every other sector from healthcare to IT to energy—whatever it is, we need people who can read, write, do math, problem solve, etc. What we’re really hoping is that more sectors really embrace the National Career Readiness Certificate and are also part of the dialogue and the partnership, so that manufacturing is forged with higher education, K-12, the workforce system, etc.
As technology advances, there has been a corresponding shift in the types of jobs available to Americans. How have you seen technology influence the economic environment in Nevada, particularly in manufacturing? What do you think these changes hold for the future of your city and the larger economy?
One thing is for sure: change is constant. As I mentioned in the conversation for the Missing Makers report, I can’t tell you for sure how we are going to be manufacturing our parts a couple of years from now because the technology is advancing at such a rapid rate. It’s actually an exponential rate. And I don’t know necessarily what the metrics are going to be that we employ to develop our parts or get our products to our customers. What I can tell you with absolute certainty is that I need people, and our company needs people, that can adapt to that changing world. People who have those foundational skills basically to be trainable and can go from one method of manufacturing a product today to a completely new method that employs a lot of technology, whether its additive manufacturing technology like 3D printing or computer-based communications technology. Those are the type of people we’re going to be looking for. In addition, I think it has to do with competition and where the world’s headed—it’s not just aerospace. The world in general is starting to embrace technology; more information is available to more people at a faster rate. The number one skills requirement is people who are adaptable and flexible and can learn the things we don’t even know today.
In your recent TedX Talk, you spoke about the need for Americans to take personal ownership over efforts to improve their communities and how it led to the creation of Empowerment Nevada. Partisanship continues to dominate much of politics; what advice would you give to young people today who want to make a difference in their community?
I think, first of all, our society somehow got to this place where we think that in order to change something or make a difference, you have to go get permission or you have to get your idea sanctioned by someone “in power,” whether that’s a politician or someone in office—that those are the people that can make it happen. Through my work, I’ve learned that the real power in this country, even today, really does lie with the people. Everything that happens in this society, whether it’s the creation of a business or the election of a leader, it all comes from the work of the population. So my advice to anybody is: We have a sovereign right and a sovereign duty at the most fundamental level to be engaged people who pursue knowledge and ideas and challenge the status quo. You don’t need a title to do that; just being a human being and a citizen in this nation gives you the right to do that. In fact, when you look at the people who had the most transformative effect on our society, when you think of the Martin Luther Kings of the world, for example, they weren’t elected politicians. They were citizens who had a cause, a belief, an idea, and they pursued that without permission. They pursued it with passion and without fear and changed the world. Rather than think that we have to spend all this money to get into that partisan boxing ring to get ideas to happen, my advice is just to step back from that for a second and take your role as a citizen a lot more seriously and own it. I think a greater good can come from that than thinking we have to wait for permission and wait for someone else to bring that idea to fruition through a largely bureaucratic and inefficient process.