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Ranked #8: Availability of Skilled Labor

The high ranking of the availability of skilled labor factor is confirmed by those firms taking advantage of programs pre-certifying workers' skills.

Richard L. Ferguson, CEO and Chairman of the Board, ACT, Inc. (Aug/Sep 07)
Finding skilled workers to fill jobs is a significant challenge in most site selection projects. For example, when you invest $230 million to expand operations for your company's most successful production line, you want to be sure that you have the most highly skilled employees to operate the equipment. Brad Rhorer knows this all too well.

Rhorer is a group leader at Subaru of Indiana Automotive (SIA). In early 2007, SIA's Lafayette, Ind., plant was contracted by the Toyota Motor Corporation to meet demand for the Toyota Camry - the best-selling car model in the United States. Toyota planned to expand its operations in a region with a significant number of workers whose skills matched those needed on the Camry production line.

"They were looking for manufacturing experience," Rhorer said. "But more than that, they were looking for people who had good teamwork skills, good listening skills, and could follow standardized work instructions. Here, you do the same process the same way every time to ensure quality in the car, so you need people who can follow those instructions."

Finding the Skilled Labor
It boils down to skills. Eighty-five percent of the executives who responded to Area Development's Annual Corporate Survey ranked "availability of skilled labor" as very important or important when considering site selection. But how can a company determine where the skilled labor resides?
Government data - such as unemployment and high school and college graduation rates - give some useful information but rarely indicate the employability skills of residents. Some communities conduct local labor surveys that are useful in estimating the percentage of workers in the region that may be interested in changing employers, or identifying the degree of underemployment in the area. But this information still does not provide executives with a solid understanding of a region's work force skills.

Toyota, on the other hand, had access to data on regional work skills that were used in making the decision to expand to Lafayette. Thousands of Lafayette-area residents had been tested for employability skills using ACT's WorkKeys assessment system. The Tecumseh Area Partnership, a work force and economic development partner entity covering 14 counties in west-central Indiana, has worked with regional companies for years in hiring and developing workers using the WorkKeys system.

"Part of Toyota's decision to relocate to Lafayette was our database of more than 6,000 assessed job applicants who were assessed using WorkKeys," said Deborah Waymire, chief operations officer of the Tecumseh Area Partnership. "We could demonstrate that we have not only a large work force, but a skilled work force that meets their specific needs."

Foundational Skills
Executives and site selection consultants are looking for regions that have workers with foundational skills - such as reading for information, applied mathematics, the ability to locate information, and teamwork - that indicate job-readiness and trainability. The WorkKeys system has been used by industries for more than a dozen years in hiring for job positions and training in foundational skills. The "job profiling" component of WorkKeys allows businesses to identify the applicable skills and skill levels relevant to a specific job. Those skill levels are then compared with examinees' WorkKeys test scores to find which individuals have the right skills for the job.

While the system benefits job-seekers and businesses in this way, economic developers collect WorkKeys skill data and use it to tout residents' skill levels and attract industries to their regions. ACT is further aiding businesses locate populations of skilled workers by creating a national foundational skill certificate system that includes a skill database, searchable by region.

ACT's National Career Readiness System awards certificates to job-seekers who demonstrate their employability skill levels by scoring highly on WorkKeys exams, and it helps them connect with employers looking to hire for those skills. Just as the ACT college admissions exam helps colleges determine which students are ready for postsecondary education, the National Career Readiness System helps businesses identify highly skilled job candidates who are ready for jobs. The system includes a national "Job and Talent Bank," giving employers a way to find highly skilled employees in a database that is searchable by ZIP code, school district, and other criteria.


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