By Alex Fitzsimmons
If the question is job creation, the answer is education. That’s the major takeaway from a wide-ranging discussion on jobs and the economy at a general session of the National Conference of State Legislatures’ 2012 Legislative Summit on Thursday.
The CEOs of two of America’s most recognizable companies repeatedly cited an inadequate workforce as the most important factor driving long-term job creation in America.
“We are failing really big,” said Douglas Oberhelman, CEO of Caterpillar Inc., which employs about 50,000 people across the United States. Oberhelman said his company rejects six out of 10 job applicants for lacking basic education skills.
State Farm Mutual CEO Edward Rusk Jr. echoed Oberhelman’s sentiment, saying, “Our students lack the skill sets required by business.” Rusk also waded into the ongoing debate over common core standards, expressing his support for national baseline standards in critical areas such as reading and arithmetic.
To address the shortage of qualified labor, the business leaders suggested a partnership between business and government that emphasizes vocational education and community colleges.
“Business plays a key role with you,” said Rusk.
While the CEOs stressed education, they also touched on debt, competition between states, and business friendliness, each of which contributes to the business of job creation.
“Revenues have to be raised, expenses have to be cut,” said Oberhelman, referring to state and federal budgets. Rusk agreed, noting that government debt “is a growing concern.”
The moderator of the session, John Engler, called on states to increase fiscal transparency: “I think there is a need for states to step up and mandate transparency.” Engler draws on experience from both the private and public sectors as a former Michigan governor and current head of the Business Roundtable.
Agreeing with the moderator’s assessment, Rusk cautioned that time is not on our side. Nevertheless, all three agreed lawmakers must engage in the difficult conversations about debt.
“Let’s get it on the table and deal with it,” said Oberhelman.
The panelists stressed that while serious debt reduction is a “painful” process for lawmakers, the business community stands ready to support them. Oberhelman in particular spoke of “impactful partnerships to address these issues.”
Even though the speakers said workforce development is the most important issue related to job creation, the CEOs also mentioned competition between states and business friendliness as contributing factors.
While many states “roll out the red carpet” for businesses, as Oberhelman put it, the panelists lamented what they referred to as a hostile relationship between business and government.
“We are welcomed in many other places around the globe,” said Engler, but not as much in America.
It’s a “competitive advantage issue,” noted Oberhelman.
Despite this sometimes icy relationship, the panelists encouraged the state legislators and legislative staff in attendance to partner with the business community to forge a better future.
“We must be all in” it together, said Rusk.