News: CJ Exclusives

Success Rate Of State Customized Training Program Questioned

$2.4 million program shows scant evidence it has boosted economic development

North Carolina’s Customized Training Program, run by the state’s community colleges, has come under fire lately. Some prominent critics contend that it is — at least in part — a wasteful way to promote economic development in the state.

Although proponents claim that CTP has helped lure businesses to the state, the evidence is scanty. Proponents have not cited a single business that will say CTP was a decisive factor in its decision to locate in North Carolina.

Each year, the CTP program spends $12.4 million in state tax money to train North Carolinians to work at specific companies. The training is conducted at community colleges and consists of two parts. One trains employees who already work for the companies, working to improve their efficiency, knowledge of safety procedures, or other skills.

The second part, “pre-employment training” or “realistic job previews,” is for people who are not working at the company; it is part training and part extended job interview.

Potential employees are trained to work for companies that may or may not decide to hire them. Both types of CTP projects typically last 12 to 24 hours — two to four hours per day spread over one to two weeks. Most of the time, community college instructors conduct the training sessions, but outside contractors sometimes are called in when special expertise is needed. According to program officials, the average cost per trainee last year was $370.91.

Each time CTP sets up a “realistic job preview” to assist a company, it assigns a training budget assuming that only one in four trainees will be hired. This has led critics such as Triangle Business Journal editor Sougata Mukherjee and John Locke Foundation president John Hood to complain that because many potential employees are trained but never hired, both tax dollars and the time of the trainees are being wasted. “If an official says that a 25 percent success rate is the best the program can do,” wrote Mukherjee, “that official loses all credibility with me.”

It turns out that a slightly higher proportion ends up being hired. According to Maureen Little, associate vice president of CTP, roughly 3,500 North Carolinians attended pre-employment training last year, and fewer than 1,200 found employment — a 34 percent hiring rate.

This means that thousands of North Carolinians are being trained every year to work in jobs that they never will get.

The “realistic job previews” represent a small part of the CTP program. In her December 14 Triangle Business Journal guest column responding to Mukherjee’s criticism, Little pointed out that only 19 companies (out of 261 involved with the program) used the “realistic job preview” service last year. The larger part of the program is post-employment training.

Mel Collins, vice president of human resources at Pharr Yarns in Gaston County, praised the program highly. Pharr Yarns has worked with CTP for about 20 years, a time of dramatic improvements in manufacturing technology. Collins said Pharr Yarns’ collaboration with Gaston Community College has been helpful in keeping up with technological improvements and the industry’s best practices. “It was just amazing, the level of cooperation, collaboration,” Collins told the Pope Center.

Businesses support the CTP program enthusiastically. In fiscal year 2012, 98 percent of surveyed companies rated the Customized Training Program as “very good” or “excellent.” Collins also said that North Carolina’s Customized Training Program is superior to similar programs in other states. Pharr Yarns has operations in North Carolina, South Carolina, and California, but he said North Carolina’s program has been most helpful.

Duke Cheston is a writer for the John W. Pope Center for Higher Education Policy.