MARYLAND BUSINESS ROUNDTABLE FOR EDUCATION

The Maryland Employers' Workforce Skills Development
and Workforce Preparedness Survey

Executive Summary

October 1997

Introduction and Project Description

The Maryland Business Roundtable for Education, the Maryland Department of Economic Development, the Maryland Economic Development Commission, and the Maryland State of Education contracted with the University of Baltimore's Maryland Business Research Partnership to conduct two surveys of Maryland business leaders' perceptions of labor market conditions.  The cooperation between these agencies represents a unique partnership to address the issues of workforce skills development and preparedness in Maryland.  The goal of these surveys was to collect information on:

• current workforce education and skills requirements of the state's employers
• how well employer workforce needs are currently being met
• employer hiring, recruiting, and training activities
• employer suggestions on state policy actions

Partnership staff members worked with representatives from the sponsoring organizations to design two questionnaires.  Two surveys were conducted.

• A telephone survey of the human resource managers of 301 Maryland businesses was conducted by the Survey Research Center of the William Donald Schaefer Center of the University of Baltimore.
• A mail survey instrument was sent to 5,000 businesses by the Maryland Department of Business and Economic Development and nearly 700 were returned.

Maryland Business Research Partnership personnel analyzed the responses to both surveys.  The combined results of the mail and phone surveys are presented below.   Because of differences between the phone and mail survey, it was not possible to aggregate the responses to all questions.  In some cases, the data in the tables are from the mail survey, with the results of both the mail and phone survey described in the text.

This survey is a first attempt to collect information on the complex issue of workforce skills and preparedness in Maryland.  The organizations involved in this study will continue their efforts to collect information on the economic impact and importance of workforce development.  As with all surveys, this analysis raises as many new issues as it addresses.  Topics of future analysis include:

• quantifying job openings by occupational, education, and skills categories
• improving understanding of high schools skills-related inadequacies
• collecting more information on the productivity impacts of skills shortages and training
• company participation in state training incentive programs (such as the Partnership for Workforce Quality and the Maryland Industrial Training Programs
• company hiring from high school-to-work programs

These and other topics will be addressed in future surveys and analyses.

Manufacturing and High Technology Workers are in Short Supply

• Nearly 80% of firms that hire manufacturing or skilled trades workers reported either some or a great deal of difficulty in finding qualified workers.
  
  
• Firms reported significant difficulty in finding workers for high technology jobs.   More than two-thirds of businesses that hire Computer Engineers or Analysts, Engineers, Laboratory or Technical Personnel, and Computer Technicians or Operators reported difficulty in finding qualified workers.  These workers are a critical component of Maryland's high technology sector.

Technical Skills in Strong Demand

• Qualified graduates from high school vocational programs are in demand.   Fifty-seven percent (57%) of firms that hire graduates from high school vocational education programs reported difficulty in finding qualified applicants and 44% of firms surveyed reported that their need for graduates from high school vocational programs would increase over the next five years.
  
  
• Employers also reported needs for graduates from college and university scientific and technical programs.  Fifty-five percent (55%) of firms that hire college-level scientific or technical program graduates programs reported difficulty in finding qualified applicants and 62% of firms surveyed reported that their need for such graduates would increase over the next five years.

Higher Education Considered an Important Asset

• More than 80% of responding firms reported that Maryland's public and private colleges, universities, graduate schools, and professional schools were either good or excellent.
  
  
• Community Colleges were ranked as good or excellent by 62% of respondents.

Worker Shortages Negatively Impact Maryland Businesses

• Thirty-eight percent (38%) of survey respondents reported that a lack of skilled workers has negatively impacted their firm's ability to do business in Maryland over the past year.
  
  
• Of the 335 companies that reported being negatively impacted by a lack of skilled workers, 84% reported that worker shortages reduced productivity and 64% reported reduced ability to meet deadlines.
  
  
• Of the 335 companies that reported being negatively impacted by a lack of skilled workers, 43% reported that worker shortages have prevented their company from expanding its facilities and 9% reported that worker shortages may force the firm to close or move some operations out-of-stage.

Employers Report High School Graduates are Important but Few Prospects for Drop-outs

• Sixty-three percent (63%) of the companies surveyed reported that they hire workers with a high school education or less.
  
  
• When asked about problems in hiring high school level workers, 73% of firms reported experiencing problems with communication skills and 69% reported problems with writing and reading skills.
  
  
• Only 40% of firms surveyed reported that they hire workers who have not completed high school and 39% of firms reported that their need for such workers would decrease over the next five years.
  
  
• Businesses rely on past work experience in hiring high school level workers.   Ninety-three percent (93%) of firms surveyed reported that they check information about previous work experience in hiring high school level workers, but only 21% review teacher recommendations and 15% review academic records.

Maryland Employers Invest in Training

• Sixty-eight percent (68%) of the companies surveyed provided some form of employee training.  The most important reasons for providing training were to increase worker productivity or to improve technical skills.
  
  
• More than 70% of employers reported training 10% or more of their employees annually, and 26% of employers reported training more than 75% of their workforce annually.
  
  
• Training expenditures ranged from $2,300 for training a new employee to $2,250 for training a professional employee to $1,375 for training a non-professional employee.
  
  
• More than three-quarters of companies surveyed that provide employee training regularly use in-house training departments, 66% use colleges and universities, 55% use industry or trade associations, and 55% use outside consultants.
  
  
• Only 13% of the companies surveyed received training assistance, with state training assistance being the predominant form of training assistance received.

Suggested State Action Items

• Businesses considered programs to improve the available pool of qualified applicants to be the most important action items that should be considered by the state government.   Improving or expanding technical training in high schools was considered important by 93% of responding firms.  Improving the linkages between the state university system and the business community and expanding technical training at community colleges were considered to be the second and third most important steps and were both considered to be important by 92% of responding firms.

The state's workforce is one of Maryland's most important competitive assets.   Nearly every study of economic development or business site selection places the availability of skilled workers as one of the chief determinants of state economic growth.   It is the foundation on which Maryland's success in key industries such as business services and high technology is built.  The state must continue to invest in developing and maintaining its competitive labor market advantage.

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Last modified: April 10, 2001