Another Dilemma

There is an article at CNN Money that reports on a recent Organization for Economic Cooperation and Development study that ranked nations by their labor forces skill level (link: http://management.fortune.cnn.com/2013/10/25/american-skills-gap/).  The study looked specifically at  "literacy, numeracy and problem solving in the context of technology-rich environments".  Unfortunately, the United States ranked behind other advanced nations such as Finland, Japan, and the Netherlands. 

The article goes on to claim that some of this skills gap is due to a lack of employer provided training. The article cites an unwillingness to spend money on training for fear of loosing employees once they are better trained, and (ironically) an unwillingness to spend money on bringing in better trained employees. 

Some would view this challenge as a result of a tight economic situation, or the commoditization of the labor force.  However, I think another perspective may be more accurate: the prisoner's dilemma.  The prisoner's dilemma is a thought experiment used to comprehend decision making. In the experiment two prisoners involved in a crime are separated and offered plea deals to convict the other with the crime.  If they take the deal, they get less time and the other serves the max, but if they both snitch on each other than they both get the max. Conversely, if they both hold out there will not be enough evidence to convict either and they will be free to go. The experiment is meant to explore the issue of trusting another party to hold firm to an existing agreement and believing in the mutual good over individual success.

I believe it applies quite well to the current dearth of job training programs because both employers and employees are concerned about the existing agreement with regards to offering or seeking training.  For employers, they are concerned that by offering this training to their employees, these employees will seek other employment as soon as possible. The employee is concerned about whether their employer will offer them more money for taking training or may be training themselves into an area that the company could cut in the future.   These decisions are informed by the factors mentioned earlier (poor economy, lack of stable employment) and cloud some of the perception of each groups understanding of the others perspectives.  

Instead of being trapped in a prisoner's dilemma, greater communication and collaboration may offer a way out. When employer's are considering expanding training, working together with regional competitors may offer a way of reducing the risk of job jumping by newly trained employees.  This could be timing training together so that needs are filled at the same time which would minimize the need of one company to poach the others newly skilled staff (they could even pool training together to lower the cost where possible). Employers, recognizing that funding is limited, could make completing training part of the requirements for gaining a specific monetary bonus, but the raise would be contingent on the organization improving financially (which the training should be connected to). Finally, employees and employers need to be more open with each other about the need for training, the impact training will have on job security, and the career desires of the employees in question.

In many simulations of the prisoner's dilemma, communication improvements lead to better outcomes.  I have little doubt that this would be the case with job training.  For the next post I will try to link to some stories about how some organizations are doing workforce training correctly and what has worked for them.