Why Shrinking College Enrollment Is A Bad Sign For HR

Colleges and Universities will have fewer students this fall as enrollments across the board are falling.  The reasons?  It’s a number of factors – decline in college-aged kids, rising tuition costs and continued soft job market for new college grads, is making it a perfect storm for students to decide to forgo college and try and get into the job market in any job they can.  The idea being  – why go to college and come out in debt, when those who have are getting the same job I’ll get – service oriented, lower end jobs, sales positions that don’t require a degree, etc.

Here’s the big issue for employers – we need those kids in school to fill future jobs!

While the government and analyst continue to say the U.S. has a soft job market – those HR/Talent Pros in the trenches are seeing something very different!  Not enough ‘qualified’ workers for the jobs we have.  Not enough skills and training, increasing numbers of retirees and 5 plus years of not funding our own corporate training programs, have left many employers short on talent.  Having fewer college graduates in the future will only add to the shortage of a trained, technical workforce.   The current lack of STEM talent in all areas of the country is startling – and this only gets fixed by having more students in those programs, not less.

In the last year alone Microsoft released a report showing that the unemployment rate for STEM related jobs is at 3.4% – where ‘full employment’ of a field, by government standards, is considered to be between 4-5%.  These figures are during the recession!  In Michigan alone the automotive industry is searching for thousands of engineers and IT professionals – with graduates of STEM programs coming out to multiple offers and compressing salaries in many organizations.  Many other parts of the country are showing positive signs of coming out of the recession as well.  This adds to the issue of lower college enrollment as employers will soon be taking more STEM kids before graduation with the lure of money and instant employment.  We are already hearing stories about this during this summer’s internship season where engineering and IT interns are being asked to stay on full time and salaries very close to those who have already graduated.  Many students will drop out, figuring there is no need to finish, or that they’ll finish later in non-traditional formats.  Most never will.

All of these factors adds to that giant tsunami of retirements that will continue to hit over the next 5-10 years as baby boomers continue to leave the workforce.  How will companies cope?  Many will do what they have been doing for years – moving technical and engineering centers overseas where other countries have far surpassed the U.S. in STEM graduation rates.  It’s a complex time to be in HR in America – on one hand we still have relatively high unemployment as a country, but on the other we have a severe shortage of skilled workers.  The President and Congress believe ‘training’ unskilled workers to be skilled workers is the answer.  It’s not.  That is like telling a Doctor that they will be trained as a Dancer!  It takes more than desire to want to be a talented Engineer or IT Professional – it takes more than being an expert on Xbox.  It takes some real analytical ability – which most unskilled workers don’t have.

What can HR do?  Keep your workers.  Find ways to ensure those who want to retire can continue to work but add flexibility and part-time arrangements where you didn’t have them before. Continue to invest in technology – because you will have to do more with less.  Get ready to pay – because STEM workers will hold the negotiating power – more than they hold it now!  What else?  Don’t let your babies grow up to be Cowboys. Don’t let them pick guitars and drive them old trucks….Get it?  When your kid says they want to go to college and study something that they struggle to get a job – do what parents do – help direct them down another path – an easier life path of being employed.


6 thoughts on “Why Shrinking College Enrollment Is A Bad Sign For HR

  1. I don’t believe Microsoft and all these other companies complaints that there isn’t enough STEM talent. I graduated with a degree in physics. I tried for over a decade to get a job at one of these companies. My resume was always declined.

  2. The education process needs to change in this county for STEM. The article linked below really nails the experience for many students over the years. It mirrors my personal experience.

    I started as an engineering student. I could do the coursework but I hated it. I hated the weed-out approach to teaching. I hated the fact that the instructors could not teach, or did not want to teach undergrads or both. I transferred out of engineering. I was told by many of my classmates that stayed in engineering, they wished that they too had transferred out. A lot of them would go into more ancillary roles such as tech sales.


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