It’s a well-worn cliché that Millennials are entitled. But it really hit home for me last month after I wrote a piece questioning the value of esports i.e., videogames masquerading as intercollegiate athletics. For a few days, I became esports public enemy #1 on Twitter, and was having the time of my life. Attacks ran from the obvious (“Are you aware esports are about competition?”) to the personal (“given the author’s background wanting to develop healthy children, learn more about how #esports is very different than just gaming”) to the promotional (“@RMUesports is the gold standard of college programs”, “I’ll let the 34 esports athletes and 600 gaming students on my campus know Ryan but I think we’ll go ahead and keep filling jobs, engaging in world class research and elevating esports to the next great college sport. Thanks though. Come on out to #GamerU anytime”). But by far the best Millennial attack was the most entitled. It came from a gamer with the handle “Warlock Rakaul” who suggested that before I attack esports: “Hey Ryan, maybe listen to episodes 19 through 41 of my podcast.” OK Warlock, give me about 20 hours and consider it done.
Equally, it’s a cliché that successful companies invest in workforce development, including training Millennial entry-level employees. A piece earlier this month in Forbes provided a welter of examples e.g., “attracting, developing, nurturing and supporting talented people in their success… are not bureaucratic functions. In the new normal of chronic talent shortages, they offer a competitive edge. Talent is the business.”
It would be nice if the world worked this way, but articles extolling new hire training are the dross of HR literature. If it were true, college graduates wouldn’t be experiencing anything close to 43% underemployment in their first jobs. And if investing in entry-level training were as American as apple pie, why are the leading U.S. exemplars subsidiaries of German and Swiss companies? Siemens and BMW famously operate apprenticeship programs in four states. On the fondue side of the border, Zurich Insurance provides a two-year apprenticeship program in claims, underwriting, and finance, while engineering giant ABB has committed to launch U.S. apprenticeships. Anyone who’s spent any time on the issue knows that American employers have largely gotten out of the business of training entry-level employees; according to an Accenture report, less than half of all employers provide any meaningful training at the entry-level.
I can hear the hue and cry from the higher education community (and perhaps Millennial gamers named Warlock): Don’t American companies try to maximize profits, and won’t investing in talent allow them to do this? The problem is that there are a lot of “IFs” in this equation: investing in new talent works IF the talent completes the training and IF they become productive faster and IF they don’t leave soon thereafter. And as most employers use an extraordinary high discount rate for these kind of decisions, any potential return is drowned out by the cacophony of IFs.
Inc. is more succinct (putting the inc back in succinct): “the ROI is not always clear.” So what are the characteristics of employers that are willing to invest in entry-level talent development? Answering this question is key to addressing underemployment and Millennials’ failure to launch, and possibly locating the most promising faster + cheaper alternative pathways to good first jobs. The answer isn’t companies that hope and pray they’ll ultimately make money from their investment, but rather companies that know they’ll make money off the bat. It turns out the scalability of training (and therefore hiring) at the entry level is directly proportional to how quickly that training turns into incremental revenue.
Last month, the New York Times profiled California health system Kaiser Permanente’s investment in a new medical school in Pasadena. Kaiser had doubled down on its investment, announcing it would waive tuition for the first five classes. A good example of employers doing workforce development for themselves right? Not on any meaningful scale. The new medical school will graduate 48 new doctors each year – starting in four years. So in a decade, the school will have produced approximately 300 doctors, or just over 1% of the doctors currently employed by Kaiser. It’s unrealistic to expect Kaiser to invest significantly in the development of anything more than a trivial portion of the medical professionals it requires because the time lag is far too long.
A different issue is presented by insurance giant AON. Its apprenticeship program in Chicago has received a ton of attention, and with good reason. AON is recruiting low SES candidates and partnering with local community colleges to provide pathways to good entry-level jobs, starting at $55,000. AON is investing a great deal in training and managing the program. However, so far AON has hired only 50 apprentices, and has committed to only another 50. Why so few for a company with 50,000 employees? It may relate to the classic apprenticeship question of how many 19- and 20-year-olds you want running around the office. But I suspect the primary reason is that the entry-level roles AON is training and filling are support jobs in human resources, IT, and claims. They are not client-facing, revenue-producing positions.
If it takes too long, or if the jobs aren’t revenue producing, entry-level training is unlikely to scale. In contrast, consider the case of RemoteMD. RemoteMD is a leading Boston-based provider of remote monitoring services for cardiac devices. Increasingly, Bluetooth-enabled pacemakers are capable of providing data on anomalies, and that data needs to be monitored in order to ascertain whether there are issues that require medical intervention.RemoteMD’s co-founder Matt O’Neal told me there’s a high level of unmet demand for his service from hospitals, clinics, and physician practices, but he was having a lot of trouble finding candidates with relevant experience. So last year, he launched RemoteStart, a formal training program for new clinical monitoring associates (CMAs). RemoteStart ensures CMAs are capable of navigating large amounts of medical data on the RemoteMD platform, and within months, new hires are serving clients and generating revenue. O’Neal expects to source all new CMAs through RemoteStart.
Likewise, Techtonic is a software development shop based in Boulder, CO. Up until a few years ago, Techtonic sourced new talent in the haphazard manner of most employers, only that in skills gap-prone software development, haphazard is typically hazardous to growth. So founder and CEO Heather Terenzio took the bull by the horns and sought U.S. Department of Labor approval for a registered apprenticeship program in software development. Techtonic Academy became America’s first such program. Apprentices train for up to 12 weeks, but typically after week 8 they are paired with senior or junior developers on client projects and begin billing hours. After a few months, the investment in training has paid for itself. Since launch of its apprenticeship program, Techtonic’s business has scaled nearly five-fold and, like RemoteMD, Techtonic is running all entry-level hires through its Academy.
We need to stop living in a fairy tale where all employers are likely to scale entry-level training, solve underemployment, and facilitate novel and important pathways to great careers, if only they were sufficiently enlightened. (As workforce fairy tales go, this is the Lion King blockbuster.) Employers are only likely to do this for themselves if they have a strong commercial incentive to scale provision of entry-level training. And there are two necessary elements: (1) The training needs to be relatively compressed – typically 3 months or less, which means Last-Mile Training; and (2) The positions need to be client-facing and revenue producing. Sectors and businesses that meet these criteria are well positioned to rethink how they source entry-level talent, and grow rapidly via a pyramid-shaped workforce with a wide and deep base.
As Ray Stantz says in Ghostbusters, “I’ve worked in the private sector. They expect results.” If you haven’t worked in the private sector, know that the vast majority of employers are coin-operated, meaning they’ll only do something hard if it’s going to make them more money now. Those of us in the higher education and workforce development worlds would be well served to understand this, abandon unrealistic expectations about what employers are going to invest in, and focus our efforts accordingly. Improving our understanding in this regard is the best way to help create more and better employment opportunities for entitled, underemployed, esports-loving Millennials.