Talent Management, Training & Development

Shrinking College Enrollment Makes HR’s Job That Much Harder

College graduates

Colleges and universities will have fewer students this fall as enrollments are falling across the board.

The reasons? It’s a number of factors – a decline in college-aged kids, rising tuition costs, and continued soft job market for new college grads — and all of it is making it a for a perfect storm for students to decide to forgo college and try and get into the job market in any job they can.

The idea is this: why should I go to college and come out in debt when those who have are getting the same job I’ll get – service oriented, lower end jobs, and sales positions that don’t require a degree?

Here’s the big issue for employers – we need those kids in school to fill future jobs!

Fewer college grads = fewer qualified workers

While the government and many analysts continue to say the U.S. has a soft job market, those HR/Talent Pros in the trenches are seeing something very different. There are not enough “qualified” workers for the jobs we have. A lack of skills and training, increasing numbers of retirees, and five plus years of not funding our own corporate training programs, have left many employers short on talent.

Having fewer college graduates in the future will only add to the shortage of a trained, technical workforce. The current lack of STEM talent in all areas of the country is startling – and this only gets fixed by having more students in those programs, not less.

In the last year alone, Microsoft released a report showing that the unemployment rate for STEM related jobs is at 3.4 percent – where  ”full employment” in a field, by government standards, is considered to be between 4-5 percent. These figures are during the recession!

In Michigan alone, the automotive industry is searching for thousands of engineers and IT professionals, with graduates of STEM programs are coming out to multiple offers and compressing salaries in many organizations. Many other parts of the country are showing positive signs of coming out of the recession as well. This adds to the issue of lower college enrollment as employers will soon be taking more STEM kids before graduation with the lure of money and instant employment.

A difficult time to be in HR

We are already hearing stories about this during this summer’s internship season. Engineering and IT interns are being asked to stay on full time with salaries very close to those who have already graduated. Many students will drop out, figuring there is no need to finish, or that they’ll finish later in non-traditional formats. Most never will.

All of these factors add to that giant tsunami of retirements that will continue to hit over the next 5-10 years as Baby Boomers continue to leave the workforce. How will companies cope? Many will do what they have been doing for years – moving technical and engineering centers overseas where other countries have far surpassed the U.S. in STEM graduation rates.

It’s a complex time to be in HR in America.

On one hand we still have relatively high unemployment as a country, but on the other hand, we have a severe shortage of skilled workers. The president and Congress believe “training’”unskilled workers to be skilled workers is the answer.

It’s not. That is like telling a Doctor that they will be trained as a Dancer! It takes more than desire to want to be a talented Engineer or IT Professional – it takes more than being an expert on Xbox. It takes some real analytical ability, which most unskilled workers don’t have.

Here’s how HR can help

What can HR do?

Keep your workers. Find ways to ensure those who want to retire can continue to work, but add flexibility and part-time arrangements where you didn’t have them before. Continue to invest in technology, because you will have to do more with less. And get ready to pay, because STEM workers will hold the negotiating power – more than they hold it now!

What else?

Don’t let your babies grow up to be cowboys. Don’t let them pick guitars and drive them old trucks … Get it? When your kid says they want to go to college and study something that they may struggle to get a job in, do what parents do – help direct them down another path,  an easier life path of being employed.

Tim Sackett, MS, SPHR is Executive Vice President of HRU Technical Resources , a contingent staffing firm in Lansing, MI. Tim has 20 years of HR and talent background split evenly between corporate HR gigs among the Fortune 500 and the HR vendor community – so he gets it from both sides of the desk. A frequent contributor to the talent blog Fistful of Talent, Tim also speaks at many HR conferences and events. Contact him at sackett.tim@HRU-Tech.com .
  • Kevin Wheeler

    Agree with everything you say except for the focus on STEM. Lots of STEM grads are unemployed despite shortages that are always talked about but don’t seem to cause much pain. LoTs of older STEM folks would love to work part time or from home but firms have rigid requirements and myoptic views of what they need and how people should work. I think young folks sense this and avoid the black hole.

  • Andy

    An easier life path of being employed does not necessarily mean that they’ll like that path, in fact that path might make them miserable if it’s not really what they want to do. Just because previous generations have essentially f*cked over the economy, doesn’t mean that the next generations would have to pay the price by not being able to follow their passions. Besides, there are loads of young people who want to go into the sciences, but it’s hard to get into that workforce without a degree and degrees are mostly very, very expensive and a lot of them would prefer not to be paying off their student loans up until their 35th birthday.

    Though I think part of the problem is that there are stories popping up left and right about these people who made it big without going to/finishing college. Those stories are shown in an “if I can do it, so can you” type of way which, while inspiring, can also be very misleading.

    Anyway this is a very interesting article, just felt like having a rant about the whole idea of discouraging kids from exploring their interests. If their choices turn out to be regrettable in the future, then that’s theirs to deal with, but I don’t really agree with taking away those choices from them. I really do think the best (and most difficult) solution to this problem is to make college education more affordable in the long run… but good luck with that, eh?