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State Lags in Employer Training of Work Force

A report's findings raise questions about the long-term competitiveness of California.

October 06, 1998|DON LEE | TIMES STAFF WRITER

California employers lag the nation in providing formal training to workers, according to a new report that raises questions about the state's long-term competitive advantage.

Researchers at UCLA, Loyola Marymount University and Cal State Long Beach analyzed survey responses received from nearly 1,000 employers in California. Comparing those results with similar national studies, they found a consistent pattern of California businesses trailing their national counterparts in various types of training--from orientation to development of basic and technical job-specific skills.

This gap was widest for large employers, or those with 250 or more workers. These businesses in California were behind the national average in all categories of job-skills training--white or blue collar.

For example, about one-third of large employers in the state said they provided training to production workers, versus 58% for comparable employers nationally. California's big employers also were significantly less likely to finance programs to upgrade professional, managerial and computer skills.

Mid-sized employers in the state (those with 50 to 249 employees) more closely tracked the national average in training. And there was one bright spot in particular: This group of firms in California led the nation in providing computer-skills training. But that was an exception.

So why are employers in California less likely to provide formal job-skills training? The survey suggests that one reason is cost. Nearly one-fifth of California employers with 50 or more workers said expenses of formal training are too high, whereas 9% of employers nationally gave that answer. California employers also were much more likely to forgo skills training because they feared losing workers to other firms.

The survey results, if indicative of actual training by companies, could have serious implications for California because training has been shown to boost productivity, which is a key to improving an area's competitive position and its standard of living.

California's economy recovered from the deep recession largely behind the strength of higher-than-average-growth industries such as electronics manufacturing and computer services. While California has a proportionately higher share of high-tech and other promising firms and jobs, the UCLA-led survey found that California employers were more likely to indicate that skill requirements at their workplaces are falling, and they expressed more disappointment--and were less involved--with schools.

In light of their findings, authors of the survey report offered several policy recommendations for the state: disseminating information to employers about the advantage of training and innovative work practices; systematic research on employer-provided training; funding training for a broader range of companies.

Christopher Erickson, an associate professor at UCLA's Anderson School who led the research with colleague Sanford Jacoby, did not describe the findings as either shocking or dire. But in an interview, he said: "This sort of finding is an indication that there is a role for public policy to play and that the situation can be improved."

The study was funded by the California Policy Seminar, and conducted with the help of the California Employment Development Department. The survey was conducted by mail in late 1996 and early 1997 of a randomly drawn sample of representative employers in the state employing 20 or more people, which account for about 73% of the state's total employment. Government and farm employers were excluded.

Inland Empire Slowdown

Mirroring the nationwide slowdown in manufacturing activity, the Inland Empire's monthly purchasing managers index for September posted its lowest level in five years and fell for the fifth month in a row.

The Institute of Applied Research and Policy Analysis at Cal State San Bernardino said its index of factory activity in Riverside and San Bernardino counties dropped to 43.7 last month, from 49.3 in August. A reading below 50 generally indicates a slowdown in manufacturing. The nationwide index, conducted by the National Assn. of Purchasing Management, said its index held steady in September at 49.4.

Southern California's diverse manufacturing sector generally has held up better than the nation and Northern California, where electronics and other high-tech production have been hit hard by Asia's situation. But there are increasing signs that factory activity and employment growth are slowing in the Southland as well.

The Inland Empire's latest survey found that 42% of the purchasing managers said that the Asian economic crisis had affected their business. That is up from 33% in August. Most said they were seeing smaller orders and other negative effects from Asia and even those who are benefiting from the low costs of imports from Asia are purchasing fewer supplies because of Asia's dampening effect on the overall economy.

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