Houston businesses confront workforce challenges
The recession of 2008 didn’t hit Houston as hard as it hit the rest of the country. Houston felt it later and pulled out of it earlier. Even the dip in revenue didn’t drop as low as it did in other areas, said Sue Burnett, founder and president of Burnett Specialists, Texas’ largest employee-owned staffing and placement firm.
Today, the region’s economy is chugging along as strong as ever, carried by a robust energy sector and brawny healthcare industry.
“The health of the Houston economy is excellent,” said Burnett, who started Burnett Specialists in 1974. “Texas is leading the way and has been for a while. Even during the recession, we were number one for job creation.”
The oil and gas industry drives much of Houston’s economy, Burnett said. It has an effect on every other industry in the city.
Burnett is placing a lot of administrative assistants, clerical specialists and human resources professionals in the engineering, accounting and legal sectors.
“We’re in a great job market,” Burnett said. “Unemployment is low. The stock market is at a record high. We’re seeing a lot of people moving to Houston because they want to take advantage of the strong economy, great housing market and low cost of living. That’s good for our local economy because those people buy houses, food and cars, or rent apartments, and that strengthens our economy even more.”
But, it’s not all roses, Burnett said. Houston’s unemployment is a low 6.2 percent, but there is still a segment of residents who are unemployed – and a segment of jobs that companies can’t fill.
Unfortunately, the unemployed don’t possess the necessary skills for the jobs that are going unfilled. And, if Houston doesn’t address that issue, it could spell trouble for the region’s future.
“There are a lot of people looking for a job, and a lot of openings. Unfortunately, sometimes the pool of applicants just doesn’t match the pool of openings,” Burnett said.
“As communities around the world rebuild their economies, many face a paradox: too many unemployed workers on the one hand and a large numbers of unfilled jobs on the other,” said Gina Luna of J.P. Morgan Chase and vice chair of the board of the Greater Houston Partnership.
Luna continued, “Like many cities around the world, Houston does not train enough skilled workers to fill jobs that are readily available. The result? The skills gap impacts everyone. If we can’t fill these jobs, it slows our economic growth. And it has a hugely negative impact on people who are unable to compete for good-paying jobs that will support themselves and their families.”
In that way, too – in dealing with the new, “global knowledge economy” of the 21st century – Houston is leading the country.
The changing workforce
This is a result of the shift in America’s workforce that places more emphasis on a post-high school education from the bottom to the top, according to Stephen Klineberg of the Kinder Institute for Urban Research at Rice University.
The Greater Houston Partnership expects the Houston area to create nearly 300,000 jobs – such as welders, electricians and medical technicians – in the next five years that will require specific training — training that will necessitate at least one year of post-high school education.
And, becoming qualified for higher-end jobs requires even more education than ever, Klineberg said.
“There’s an epic transportation of the American workforce, especially here in Houston,” he said. That transformation is from a workforce manned by privileged white folks born in the years after World War II to today’s under-20 crowd, the vast majority of whom are poor, undereducated Hispanics and blacks.
“So, that’s a powerful question: will this next generation have the skills to get the jobs in the global knowledge economy of the 21st century?” Klineberg said. “That’s the great question mark of Houston and especially of Texas and, in fact, all of the United States.
“Not everybody has to go to college, but everybody has to get a year or two [of additional education] after high school. There are no decent jobs anymore for people with a high school degree or less.”
But, these challenges are known. And, Houston is responding.
An effort is being made communitywide to reach out to youngsters to let them know that if they go to a community college, they can get the training for a middle-skill job making $60,000 to $70,000 a year.
The Greater Houston Partnership recently created UpSkill Houston, a comprehensive, industry-led approach to bridge the gap and fill jobs in middle-skills occupations. The Partnership has said 41 percent of all jobs in our area are considered middle-skills positions.
UpSkill Houston is a blueprint for leaders from the business community, educational institutions and social service organizations to build a quality workforce.
“For a problem as big and complex as the skills gap, no one company or even one industry can go it alone,” Luna said. “We need all the stakeholders – business, educators, government and the non-profit sector – to work together to solve this issue. While it’s an industry-led approach, UpSkill Houston brings all of these groups to the table so we can work together and build a quality workforce.”
Luna added, “The Gulf Coast is in the midst of an energy infrastructure construction boom, positioning our region for immense growth. UpSkill Houston is our strategic plan to make the most of this opportunity for our region, our city and its people.”
Some businesses are taking the initiative, as well, by setting up college programs for prospects, filling their ranks with qualified employees trained for the specific jobs they need.
Because early education is so important to developing a skilled workforce, the Partnership has also created Early Matters, a broad-based coalition of business, civic, education, non-profit organizations and volunteers working together to raise awareness about the importance of high-quality early education and to make a strong case for increased investment in pre-k programs.
“People understand this now,” Klineberg said. “Things are happening that would not have happened five or 10 years ago. And, equally true, not nearly enough is happening.”
Still more to do
“If we don’t turn around the terrible educational deficits in the Latino and African-American communities, we’re in trouble,” Klineberg warns.
And, the jury is out on just how to do that and how effective we’re being at it. But, there is still a window of opportunity to fix the problem.
“If Houston’s black and Latino young people are unprepared to succeed in the knowledge economy of the 21st century,” Klineberg said, “it is hard to envision a prosperous future for Houston.”