The Midwesterner: Blogging the Global Midwest

Good Jobs -- But Where Are the Workers?

The number of manufacturing jobs in the Midwest is going down, but factories say they can't find workers to fill manufacturing jobs. As they say, it's a puzzlement.

A Chicago Tribune article laid out the problem, without pinpointing the reason or saying what to do about it. In his invaluable blog, Bill Testa, the vice president and director of regional research for the Federal Reserve Bank of Chicago, has charted the trends -- Midwestern manufacturing jobs down sharply (from 4.2 million jobs in 1998 to only 2.7 million in 2010), with any improvement likely to be "modest."

This is the heartland of manufacturing, right? We know the Midwest has always lived on factory jobs. Even if the number of those jobs have declined, many factories are still there. Many factory jobs these days pay well. Most workers in factory towns don't go to college, so would be attracted to industrial jobs -- or so you'd think.

All this makes sense. And yet the workers don't seem to be there.

The Higher Cost of Higher Education

In a global economy that demands at least some post-secondary education for all its workers, the same economy may be pricing these workers out of a chance for an education.

This is not exactly news, especially to parents and students who have seen the yearly increases in tuition and other costs gallop ahead of the inflation rate for many years. But a combination of factors -- continuing rising costs, unsustainable student debt, and a terrible job market -- may be pushing this problem to the crisis point. It's a national situation, of course, but of particular concern to the Midwest, which desperately needs to educate its workers for the global knowledge economy.

Higher Education Faces Reality

Apparently it's no fun being a plain old garden-variety university, doing nothing except what universities are supposed to do, which is to teach students. Every self-respecting university, it seems, wants to be a research university, churning out research that changes the world and, one hopes, bags a Nobel Prize or two.

It's not going to happen. Nor should it. Shrinking support for higher education will dash some of these ambitious dreams. As it does, it will give these schools -- indeed, all Midwestern colleges and universities -- an opportunity to rethink their real role in education and how they can best serve not only their students but the region.

Is There a Place for Small Colleges?

They're strewn across the Midwestern landscape, as iconic of an endangered way of life as the small towns that house them. A few offer advanced degrees, but most are four-year colleges, conferring bachelor degrees only. Largely founded by religious denominations, both Protestant and Catholic, they defend that doctrinal purity today against the pressures -- mostly economic -- of a world that may go on without them.

These are the mini-institutions of higher education, private colleges and universities of the Midwest, most of them no more than a few hundred to a couple thousand students, overshadowed by the giant state schools that dominate Midwestern education, dwarfed even by the community colleges that increasingly compete with them for students.

Global Education Plays in Peoria

I wrote in a recent blog that I had been to China in connection with a program there run by Illinois Central College, a community college in Peoria, Illinois. I want to expand here on that program, because what ICC is doing, in Peoria and in China, is my idea of global education, and holds the key for the ability of today's students to thrive in tomorrow's global economy.

ICC does two things in China. First, it works with Chinese colleges to help train dealers and distributors there for Peoria-based Caterpillar. This is done on contract with Caterpillar, which pays for the service. Second, ICC sends some of its students to China for an intense education in both Mandarin and in the way the Chinese do business.

Setting Universities Free

The Chicago Council's newest Heartland Paper, "A Master Plan for Higher Education in the Midwest," by James J. Duderstadt, is a magisterial piece of work, living up to the author's goal of a "roadmap" to Midwestern education, especially higher education, and its role in the region's economic future. From K-12 to universities to lifelong education, the former University of Michigan president covers the scope of education, as seamless as it is ambitious.

Duderstadt's roadmap is a guide to the long-range future, but it also is very timely -- more timely, in fact, that we had expected when we asked him to write it for us. Readers of this blog got a preview last week, and the report itself is to be unveiled this Thursday, March 31. A couple of his recommendations seem to pop from the week's headlines and demand attention now.

Guest Post: A Master Plan for Higher Education in the Midwest

Professor Duderstadt is the author of The Chicago Council’s forthcoming Heartland Paperreport on “A Master Plan for Higher Education in the Midwest: A Roadmap to the Future of the Nation’s Heartland.” The report will be released at an evening public program on Thursday, March 31, in Chicago where a panel featuring Professor Duderstadt; Michael Hogan, president of the University of Illinois; and Jerry Sue Thornton, president of Cuyahoga Community College, will comment on the findings and recommendations. This event is open to the public, and registration information is available online here.

by James J. Duderstadt, President Emeritus, Professor of Science and Engineering, and Director of the Millennium Project at the University of Michigan

The Libya of the Heartland

All of a sudden, the Midwest has joined the Mideast as one of the world's hot spots.

From Madison to Columbus to Indianapolis, protesters are out in force to try to stop governors or legislative leaders from enacting sweeping anti-union laws. As in the Mideast, the protests seems to ripple from state to state, in a sort of political domino effect. If the Midwest is not exactly in revolution, neither is it seeing politics as usual: in each state, the middle ground has vanished, and nothing short of capitulation, by one side or the other, seems likely. 

Cities On Their Own

The mid-term elections last month have transformed time-tested relationships between the federal government, states and cities. Many details will become clear in the new year, but the overall pattern is plain to see -- cities that have always counted on federal and state money are suddenly on their own.

Both federal and state governments, including Midwestern state governments, are in deep deficit. Partly as a backlash against these deficits, voters handed power to congresspeople, governors and legislators pledged to cut those deficits.

This means two things: (1) the money isn't there, even if governments were inclined to spend it, and (2) they aren't inclined to spend it. Government funding to cities won't come to a halt, by any means, but it's going to be cut back severely. Cities that had looked to Washington or state capitals to maintain or increase funding for schools, infrastructure, economic development and jobs are going to have to look somewhere else -- mostly to their own resources.

Another Way To Work

For Midwesterners viewing the post-industrial collapse of their region's economy, one big question has to be: how do the Germans do it?  

Germany has all the ingredients of a Midwestern-style economic catastrophe -- a reliance on heavy industry, big health and pension costs, especially unionized workers. Partly because of the unions, Germany has those "rigid labor markets" that have convinced a generation of American economists that the German economy is doomed to obsolescence.

So, once again: how do the Germans do it? German industry is booming and, unlike American industry, it's still in Germany. The global recession, being global, has hit Germany, too, but unemployment there now is 7.6 percent -- not great, but a lot better than the American rate of 9.5 percent. Unemployment among young people aged 16 to 24 in Germany is 10.5 percent. Again, not great. But the U.S. youth jobless rate is 26 percent, which amounts to the economic massacre of a generation.

German labor costs and social costs -- all those pension and health programs -- are high. Its currency, the euro, also is high. This means it should be uncompetitive on world markets, leading to a big trade deficit -- right? Wrong. Germany, as usual, runs a trade surplus and that surplus ($98.7 billion so far this year) is actually up 26% over last year. Meanwhile, the United States, as everybody knows, runs a trade deficit and that deficit in the first five months of this year is up 37%, to $197 billion, over last year. (Don't blame it on on China: $12 billion of that U.S. deficit is with supposedly uncompetitive Germany.)

So yet once again: how do the Germans do it? A new book just out tries to tell how. The answer is not that the German succeed despite their heavy industry, their high costs and their unions. It's that they succeed just because of all those supposed handicaps, including unions.