Michigan can't fit college grads into job slots

If Amy Dobson is a rock and Gentex is a hard place, Gov. Rick Snyder is stuck between them.

Dobson, an effervescent 23-year-old from Okemos, finished a five-year degree program in education from Michigan State University last spring.  Despite holding a bachelor’s degree from a top-ranked education school, Dobson couldn’t find a job in her home state. Then she received three job offers in quick succession -- all in Utah.

“I would have loved to stay (near her home and family),” said Dobson, who teaches fourth grade in a suburban classroom near Salt Lake City. “I have (teacher) friends who moved to Chicago and one to South Carolina. One is working in Mexico.”

Gentex has the opposite problem. Located in a state with double-digit unemployment, the Zeeland automotive supplier has 60 job openings listed on its website, 31 for various types of engineers.

“We’ve gone from three software engineers to probably 50,” said Bruce Los, Gentex vice president for human resources. “We’d take 30 more tomorrow if we could find them.”

As Snyder prepares a special address on jobs and talent development this fall, he’d be well served to keep the young teacher and the West Michigan company in mind. Michigan workers -- and state policy-makers -- will have a slim margin of error in coming years, according to a Bridge Magazine analysis of federal data.

There are 55,000 bachelor’s degrees granted from Michigan’s public universities and private colleges annually, with about 45,000 of those degrees given to Michigan residents. Yet there are projected to be only 28,000 annual job openings in which a bachelor’s degree is the primary level of education. There are a projected 68,000 job openings per year that pay better than average wages, and those freshly minted college grads will be competing for those openings with thousands of more experienced, yet unemployed or underemployed, workers, according to a Bridge Magazine analysis of federal jobs data and college graduation statistics.

"We’re going to become an export state,” said Jack Litzenberg, senior program officer for the Charles Stewart Mott Foundation’s “Pathways out of Poverty"  initiative. “We’re going to be educating people who will go elsewhere for their employment. We’ve got good schools … but not jobs.”

Bridge found clear evidence of Litzenberg’s assertion when we combined the most recent and in-depth statewide job projections with graduation trends at the state’s public universities and private colleges.

That analysis found a troubling mismatch between degrees and jobs in many fields. For example, there are 15 percent more teachers currently produced at Michigan colleges and universities than there are annual job openings through 2018. There are twice as many communications/public relations/journalism bachelor’s degrees currently handed out as projected openings in the state; and 133 percent more new lawyers than jobs.

Meanwhile, companies face a shortage of 5,000 college grads in business, management and financial operations. Only four out of five computer and math profession jobs can be filled with the number of students graduating with a bachelor’s or master’s.  There is a 14 percent annual shortfall of doctors, nurses and other health care professionals.

The Center for Education and the Workforce at Georgetown University reached the same conclusion in a report released Tuesday. That report suggests that the challenge facing Michigan and other Midwestern states is finding ways to match education with job opportunities.

“Are we graduating too many of the wrong kind of college graduates? I wouldn’t argue with that,” said Jim Danielski, of Career Planning Specialists in Plymouth. “It’s not uncommon for people with a four-year degree to come to me and say I had no idea I would have trouble getting a job.”

Building the better worker

The solution seems deceptively simple: If students in over-supply degree programs switch to under-supplied fields, they’d get jobs and businesses would have workers. Michigan schools currently produce 1,100 more new attorneys than job openings for lawyers, while the state currently produces about 1,300 fewer degreed health care professionals than it can employ. Grab a backpack and move from the law quad to the medical school and Michigan’s job mismatch problem is solved.

Other states have tried just that. Under names such as differential funding and performance-based funding, states have offered financial incentives to colleges and universities. Such a system would shift a portion of state higher education funding to an outcome-based model, based on outcomes as defined by state priorities. (Other states tie public aid to college results)

"There’s a lot of opportunity to do things to incentivize institutions to behave in ways that help the economy,” said Keith Bird, senior policy fellow for workforce and postsecondary education at the Corporation for a Skilled Workforce in Ann Arbor. Bird was chancellor of the Kentucky Community and Technical College System when performance-based funding was introduced, and is considered an expert on state higher education funding.

“If we’re trying to recover, we ought to put a premium on creating jobs,” Bird said.  “(The colleges) have to acknowledge they are over-producing  (some degrees), … or admit they are creating an export. But it’s a negative export -- it’s bad policy.”

Some states have based a portion of funding on degree completion rates. Students who complete degrees earn significantly more than those who don’t. The average holder of a bachelor’s degree earned $27.59 per hour  in 2011, compared to $18.85 per hour for those who have “some college” but not a degree, according to the Bridge analysis of federal data.

Even in jobs that don’t require a four-year college degree, those with a diploma earn more. Nationally, secretaries with a four-year degree earn an average of 13 percent more than their less-educated co-workers, according to the Center on Education and the Workforce. Firefighters with degrees get a 25 percent bump; social workers, 36 percent; dental hygienists, 76 percent.

Some states have gone a step further and offered more money for in-demand degrees such as engineering. Bridge’s analysis projects a need for 3,820 engineers annually in Michigan, with state and private universities falling short of that figure by 3 percent.

“Give (funding) to them  in a way that modifies behavior,” Bird said. “There’s got to be a more direct connection between funding and outcomes.”

Michael Boulus -- executive director of the Presidents Council of Michigan, the unviersities' lobbying arm -- said it’s not the role of universities to push one career over another.  “We can counsel, but ... we’re not going to shut the door on a student” who wants to study in a field without great job prospects, Boulus said.

Lou Glazer, president of Michigan Future Inc., scoffs at the idea of Lansing politicians looking into a crystal ball and deciding what jobs will be in demand years from now. Even if they could, “public universities are not agencies of the state government,” he said. “Michigan’s higher education system is in the business of preparing people for life and preparing people for careers in the global economy. That may be in Michigan. It may be in Sri Lanka. That’s not U-M’s responsibility.”

That may be true when the economy is humming along, Bird said. But when the state is counting every dollar, policy-makers must make sure that taxpayers are getting a good return on their investment.

“There’s tremendous resistance to associating knowledge with finances,” Bird said. “(But) colleges have a responsibility to make wise use of public funds.”

Few prepare for their careers

One area of agreement is that students are getting inadequate information about career choices. High school counselors are overworked, and college counselors seldom talk about the job outlook and pay scales of various professions.

“(Michigan State) didn’t talk about (job prospects for teachers),” Dobson recalls.

In Dobson’s case, it didn’t matter – she knew the job market was tight for teachers in Michigan, but she chose to get an education degree anyway. “If I would have tried engineering just because that’s where the money is, I would have failed at it,” Dobson said. “You have to follow your heart.”

But for others, “the students are totally unaware of the choices they are making,” Bird said. “If they were getting career coaching, they may be making choices to make themselves more employable.”

Bird suggests the state create a career information model that is easily accessible by students and parents.  In terms Snyder uses, a “career dashboard” could include projections for new jobs and total openings by occupation, as well as average salary, the educational attainment of those in the field and how many are graduating each year with the training required for the job. The dashboard also could include up-to-date statistics on unemployment and average salary by education level.

“If we don’t work upstream, we’re going to have a huge skill mismatch,” said Amy Cell, senior vice president for talent development at the Michigan Economic Development Corp. “There needs to be a better matching of education and opportunities.   How do you communicate that to people so they can make good choices?”

Those good choices need to be made not just by students, but by universities and businesses.  As an example, Cell notes a projected shortage of chemical engineers in Michigan. “How do we create a discussion (with Michigan colleges) so we don’t end up with 20 new chemical engineering programs and create an oversupply? Universities need to work collectively on curriculum.”

Meanwhile, businesses such as Gentex aren’t waiting for applicants to come to them, even in an employer’s market.  The high-tech auto supplier has partnerships with 14 universities around the Midwest, with Gentex offering input on curriculum and the schools sending graduates to Zeeland.

“We probably do 80 percent of our recruiting in Michigan,” Los said. “We have strong relationships with professors. We see this as a competitive advantage.”

The MEDC is building a “talent map,” a database listing openings by occupation in 44 industries, in hopes of helping connect talent with jobs. “If welding skill is needed in 18 of the 44 industries, for someone who was laid off in one industry, this can help them find a position in another industry using the same skill.”

It’ll probably take all those efforts and more to create the number of jobs, and the kind of jobs, needed to turn Michigan’s economy around to the point that people like Amy Dobson can come home.

“I’d love to come back to Michigan some day,” she said, before hanging up her cell phone and walking into her job in Utah.