A new book by Washington Post staff writer Amy Goldstein tells the story of one community where residents were plunged into unemployment and poverty after the largest employer, General Motors (GM), left town. Janesville, An American Story, details the loss of a GM plant and supplier plants in the town of Janesville, Wisconsin. The author tracks several former GM and supplier plant workers between 2008 and 2013 as they try to understand their choices in the changing labor market of their town. In the story, several job seekers entered community college to acquire credentials and knowledge they hoped would lead to new jobs. Others became GM wanderers and separated from their families to work in GM plants hundreds of miles from home. Still others took jobs wherever they could find them.
I was most interested in understanding the outcomes for the workers who committed to skilling themselves up through training and education. These were individuals who had already been working for years, had families, homes and middle class life styles built on average wages of $28 per hour. Would an occupational certification or an Associate’s Degree be sufficient to earn new jobs with comparable rates of pay?
Goldstein joined with economists to conduct a study on how thousands of Janesville area auto workers who lost their jobs fared after attending Blackhawk Technical College, a two-year school that focuses on vocational programs. Following the plant shutdowns, the school experienced its biggest enrollment surge in its 100-year history.
Unfortunately, the results were not all good. In the years immediately after the plant closures:
- About one-third of the laid-off workers who entered Blackhawk completed their program of study within the expected time.
- Laid-off workers who went to school and completed their training programs were less likely to be working than laid-off workers who had not gone back to school.
- Those who went to school were earning less after retraining than those who had found other jobs after the lay-off without re-skilling.
Based on the profiles highlighted in the book, the retrained workers pursued jobs in criminal justice, social services, human resources and installation work for an energy company. For individuals who did not reskill, their choices included small manufacturing plants paying much less than what GM and its suppliers were paying before the closures.
What can we learn from this unfortunate story?
- Depending on the job a dislocated worker previously had, it may be likely that a new job, even after re-skilling, will start at a lower rate of pay.
- If the new job is associated with a career path that leads to better paying work over time (possibly dependent upon additional training and credentials), education and training can still provide a path back to solid employment with a family-sustaining career.
- Before choosing which program to study, workers should always be aware of what skills are in demand in their labor market so they do not train for non-existent work or work that is not attached to a career path offering advancement potential.
As the labor market continues to shift, the demand for a skilled workforce is as strong as ever. Experts in the local labor market exist to help unemployed workers choose career pathways that have the most potential for good paying starting salaries and growth potential.