Technical schools can't keep up with demand for electricians and other skilled labor
It's almost lunchtime, and the smell of 25 hot pizzas wafts through the lecture hall as dozens of young men in ball caps and baggy T-shirts take their seats and the Wyoming coal company begins its spiel.
After an impressive rundown of the equipment used in Peabody Energy's three Powder River Basin coal mines - how big the trucks, how expensive the tires, how many gallons of diesel used per day - the most important numbers come up on the screen.
When these young men finish their electrical or mechanics programs at Western Dakota Technical Institute, they can earn $21 to $23 an hour with nearly unlimited opportunity for time-and-a-half overtime, not to mention a 401(k) plan, free health insurance, educational assistance and even a tool allowance, the man from the coal mines tells them.
When the presentation is over, the students line up for lunch and weigh their decisions: Pepperoni or sausage, Wyoming or South Dakota?
The pull from the mines, along with the beginning of the baby boomer retirement wave and growth in the local construction industry, have made it hard for companies hiring electricians and other skilled workers in Rapid City.
Tech schools, limited by space and funding, aren't producing enough graduates each year to meet the demand, so electrical contractors and others who hire skilled workers to fuel Rapid City's growth are having to get creative in competing for students like these.
WDTI electrical instructor Art Balcom said Rapid City has been fortunate the housing market has remained stable in the midst of a national crisis, and when the local market "turns back on, we'll be really short" of workers.
Competing for help
Paul Muth of Muth Electric said his business faces the same challenges as do welders, builders and others in the construction industry.
Muth is looking to fill about 40 electrician positions among the company's eight offices, seven of which are in South Dakota, and recently took steps to make these jobs more appealing. They've increased starting wages by $2 or $2.50 per hour. They've started a tuition reimbursement program for new hires. A high school job shadowing program introduces young people to the field, and a new, full-time recruiter is devoted to finding good candidates.
"It's getting more and more demanding to get people to want to enter the construction industry," Muth said.
The Rapid City Area Chamber of Commerce recently announced a new program to hire a coordinator who will recruit high school students for jobs throughout the construction industry. The chamber said it seems some students are being pushed into a four-year college - or not encouraged in any sort of post-secondary education - when they might be well-suited to a trade.
Although an electrician job might pay less than $10 an hour to start for an inexperienced, untrained worker, the pay scale goes up fairly rapidly with training and years on the job, and Muth said the top 14 percent of the company's electricians make $68,000 to $98,000 annually.
There is some benefit to the demand for electricians; the current workers are forced to do their jobs better and more efficiently, Muth said, using new techniques that eliminate wasted materials and time.
But in the long run, he still needs more workers to replace retirees and allow the company to grow and take on projects such as energy pipelines, wind-turbine installation and growth related to the Homestake mine.
"It's a real need for electricians," Muth said.
WDTI officials said if they graduated twice as many electricians each year, the students would still find jobs. But the school is limited by how many instructors and materials it has the money to provide. Some local employers said they believe WDTI could fit more electrician students in its classes, but the school said classes are kept small to give students personal attention and the opportunity for hands-on training.
"If we have classes that are twice the size they are now, we don't think that's going to happen," said Steve Buchholz, WDTI marketing director.
The lack of capacity, he said, is "frustrating for us that we know the interest is out there, both from the students and the employers," Buchholz said.
More state funding and more partnerships with business and industry could fill the need, he said. Local taxes don't reach WDTI directly; tuition and fees pay about half the cost, and state support pays the rest, he said.
Lobbying for support
The school and other technical institutes had legislators in mind when they put together a study earlier this year that found the state's technical schools are barely graduating enough electricians to fill half the need.
The House and Senate approved a measure that would have retooled the funding structure for the state's technical institutes, making it easier to expand and add programs like the electricians', but it met with the governor's veto.
"We're coming up on a time frame, especially in the electrical arena, where we have a lot of folks getting ready to retire," said state Rep. Jeff Haverly, R-Rapid City, who sponsored the bill and others like it in the past. "It's going to cause a surge of needed employees. We are not prepared for it at this point."
Haverly is worried that if schools like WDTI can't expand, students will go out of state, and stay out of state after they graduate.
He said a set of bills approved in the 2008 Legislature that provided one-time money for tech school programs was a sign. "We finally have broken through with the administration."
The issue of how best to govern and fund the state's technical schools will come up again in the 2009 Legislature, Haverly said.
"Instead of confrontation, hopefully, this will be the year we come away saying we got something done for the tech institutes," he said. "With my constituency, not everybody's going to go to a four-year institution, and not everybody's going to be a teacher or an engineer. Work force is extremely important to South Dakota."
Haverly said the state won't be able to import workers to meet the need created by retirements.
"We've been told time and time again by the major utility companies in the area that there's just not replacement workers for those folks. We need to address that, and we need to address it now, because time is running short."
Al Sutton, who owns an electrical contractor business in Rapid City, said he doesn't necessarily have trouble filling jobs, but he said there needs to be an increase in experienced and committed people coming into the field to replace the journeymen and project managers who leave.
"If they produced more, and they were students that were interested in the construction field, it would help out considerably, because construction is in a little bit of a lull, but it's going to come back," Sutton said.
He wants the school to produce more graduates interested in staying here in construction instead of those who want to move to Wyoming to work in mining.
But it's hard to get students to see past the big wages.
"They've got such golden opportunities" in Wyoming, Balcom said. "A lot of our students choose that route instead of staying here and going into construction."
Annual income of about $50,000 - what some students can earn straight out of school in the Wyoming coal fields - looks like a fortune to some.
"Some of these students go from working in fast food to $25 (per hour) in one step," Balcom said. "You see a lot of new Dodge pickups."
Local businesses urge students to consider the difficulty and cost of finding housing in Gillette and other Wyoming cities, and the relative lack of amenities like the shopping and community services found in Rapid City.
"In 1976, when Wyoming had the first gas boom, we had the same thing," Muth said. "Eventually, people found out that after they paid for the higher cost of living, it's a wash. A lot of them filtered back."
Posted in Local on Monday, September 22, 2008 11:00 pm | Tags: Soderlin, Rapid_city, Western_dakota_technical_institute, Electricians, Shortage
© Copyright 2009, rapidcityjournal.com, 507 Main Street Rapid City, SD | Terms of Service and Privacy Policy