While the market meanders out of the fourth quarter, understand that this has been a great quarter. In fact, this quarter marks the sixth straight winning quarter, a feat last accomplished during the fourth quarter of 2006. I think all the pieces are in place for this party to continue and a lot centers on the rebound in manufacturing. Today we got amazing news from the National Association of Manufacturers on optimism among their ranks.
Not only did the headline number come at all-time record but the “right track” number surged to 59.9% from 25.7% quarter to quarter. By the way I’m interviewing Jay Timmons the head of NAM tonight on Making Money w/ Charles Payne Fox Business 6 PM.
According to the Bureau of Labor Statistics there were 364,000 manufacturing job openings in January up more than 40,000 from last October. There is a problem, however, and it is all about skills.
Last month manufacturers in the Philadelphia area were asked supplemental questions during the Fed survey and their replies were eye-opening. More than 60% say they have a labor shortage and 68% point to a skills mismatch.
But what’s even more amazing is the skills mismatch isn’t about computers, heck, they say basic reading and writing are bigger challenges but it’s the ability to actually use the machines and tools.
What makes this remarkable is that 88% of these jobs that are out there right now can be had without a college degree.
Here’s the bottom line and it is great news- you need skills but you don’t need a couple hundred thousand in debt or to put off having a family. In fact, Michael Bloomberg put it best when as mayor of New York City he began transforming schools for technical careers stating: “College isn’t for everyone, but education is.”
The problem is America gave up on the German style industrial education a long time ago and people that have lost jobs feel hopeless. That’s changing fast. There are organizations like the Louisiana Economic Development (LED) program that works to develop nine areas of economic development including technical training.
If you are against government being involved in any training consider that Nevada taxpayers are ponying up $750 million for a football stadium and US taxpayers forked over $41 billion for Ivy League tuitions from 2010 to 2015. I think it’s smart for states to look into programs like LED.
Finally, businesses need to step up and make the investment as well since only 54% are retraining existing staff and 29% are aligning with educational organizations on technical curriculum.
The great news is we are on the cusp of a Manufacturing Renaissance. We must seize the moment.
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