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Rise of the ‘silver collar’ workforce: When a four-year degree isn’t the right move

By   /   April 27, 2015  /   News  /   No Comments

Photo from Flickr Commons

IN DEMAND: Petrochemical plants and other manufacturers are actively looking for skilled workers in fields like welding and pipefitting.

By Rob Nikolewski │ Watchdog.org

This may come as bad news for parents who have spent tens of thousands of dollars sending their kids to expensive universities, but one path for young people getting a good job requires just a two-year degree or, in some cases, no college degree at all.

“The reality is, most jobs do not require a four-year college degree,” said William C. Symonds, executive director at the Global Pathways Institute at Arizona State. “What they do require is some solid technical skills. And the best way to get those is at a program lasting two years or less.”

The average amount of college student loan debt rose last year to an average of $28,400 while an increasing number of graduates either can’t find work or are working at jobs that don’t even require a bachelor’s degree to begin with, leaving many of them — their parents included — wondering if they’ve wasted their money.

“I think we made a real mistake as a country moving away from the vocational school option, absolutely. That’s where many of the jobs are needed,” said Symonds, whose organization concentrates on fixing what he’s called the “disconnect between education and business.” 

“There was so much emphasis on going to four-year schools, we have the highest college dropout rate in the world and the costs are out of control and students are taking on a lot of debt,” Symonds told Watchdog.org in a telephone interview.

While it’s true statistics show that overall, those with bachelor’s degree and higher tend to make more money than those who don’t, there are some fields where workers who received associate’s degrees in two years — or certifications that can take as little as six weeks — are making good livings.

“I think we lost focus on the fact that middle-skill jobs also pay reasonably well,”  said David Longanecker, president of the Western Interstate Commission for Higher Education, based in Colorado. “You get to them much quicker and for many people, the nature of the work is rewarding than the work that comes with a a bachelor’s degree because you’re working with your hands.”

For example, the petrochemical business, hard-pressed to find skilled workers, offers starting wages between $17 to $18 an hour — income that many an art history or English Lit major would envy.

Data from the Institute for College Access and Success

DEEP IN DEBT: The states with the highest averages of debt for students at college gradution.

“They’re calling them ‘silver collar’ jobs,” said Melissa Hockstad, vice president of petrochemicals at the American Fuel and Petrochemicals Manufacturers. “That’s because for many of them, they’re based on the hours you work and with overtime, you can make upwards of six figures.”

For people like Skyler Browning, a recent graduate of the pipefitting technology program at Lee College in Baytown, Texas, it’s goodbye to the mindset that blue-collar manufacturing jobs are so last century and welcome to the brave, more profitable and happier world of skilled labor.

“You put in a hard day’s work, earn an honest day’s living and you got a fat wallet,” said Browning, whose story was featured in an online video posted by the school.

Browning earned his pipefitting certificate in a year and a half and started making “between $50,000 to $60,000 a year.” After eight years, he says he now earns “in the range of $140,000 a year.”

The petrochemical industry is making a comeback, with a recent report from J.P. Morgan Chase estimating that new plants worth about $80 billion are scheduled to be built in coming years.

The American Chemistry Council is even more bullish, reporting that 225 new chemical industry projects have been announced in the United States, which translates into $138 billion in activities that include new facilities, expansion and increases in capacity.

The gas and chemical refineries on the Texas and Louisiana Gulf Coast area are particularly hot and a host of community colleges in the area are recruiting students to meet the needs of companies like ExxonMobil Chemical, Dow Chemical and LyondellBasell.

Petrochemical outfits take natural resource products like crude oil and natural gas, break down their hydrocarbons and convert them to materials ranging from plastics to medical devices to parts used for making solar panels.

“Skilled welders represent the most critical resource demand in our industry, especially along the U.S. Gulf Coast,” Jim Hanna, human resources executive director at Fluor, a global engineering construction company, told the Houston Chronicle. “However, other crafts like pipefitters, equipment operators, electrical and instrumentation technicians will be in demand, as well, as major projects are executed.”

Lee College takes part in a consortium of nine schools that offer a range of two-year, associate degrees and certifications in fields like welding and pipefitting. The starting salary for these technical jobs is commonly $62,000 a year — not including overtime.

“That’s a pretty good deal,” said Longancker. “There is much to be said, particularly for returning adults and older adults who are changing careers, to look at the value of certificates and associate’s degrees as a new venue.”

Photo courtesy of Lee College

IF THE PIPE FITS: Pipefitters are in demand and can start earning good wages with a community college certification.

To help students who are changing careers or looking for work, Lee College also offers a fast-track program in which students can earn certification in as little as six weeks.

“When you’re unemployed, you often don’t have the time to go to class two nights a week for 16 weeks,” said Debbi Jordan, the school’s executive director of workforce and community development. “You need that training now.”

Jordan said the fast-track program emphasizes to students drug-testing requirements and background checks.

“You need to be employable,” Jordan told Watchdog.org.

But while the gulf coast is the epicenter for petrochemical jobs right now, other parts of the country have more mixed results.

In recent days, it was reported that an energy company based in Thailand is considering building a plant in eastern Ohio to process natural gas liquid components used in plastics.

Royal Dutch Shell has plans to construct a plant in the Pittsburgh area, but progress has been slow.

And it was announced Wednesday an ambitious plan to construct a plant in West Virginia that would convert natural gas has been put on hold by the two Brazilian companies in charge.  According to at least one report, executives are worried about the falling price of oil and what it would mean for using ethane — which the plant would derive from oil.

While falling oil prices lead to some unanswered questions, the dramatic drop in natural gas prices has translated into very good news for the petrochemical industry.

The “shale revolution,” which has been tied to the technology used in horizontal drilling and hydraulic fracturing, coincides with natural gas prices that were at $12.50 per million BTU in 2008, compared to 2015 prices that are expected to stay in the $3 to $4 range.

“Natural gas is an important part to the petrochemical industry, using it as an energy source as well as a feedstock,” AFPM’s Hockstad told Watchdog.org. “This is a new economics that has really helped to create a competitive advantage for U.S. manufacturers. So we’ve seen this dramatic reversal from years ago when you’d see manufacturing leaving the U.S. and now the U.S. is one of the most affordable for petrochemical production.”

But the push in recent years to steer high school students to four-year colleges resulted in a de-emphasis on vocational schools across the country.

That’s created a generation gap between skilled workers now approaching retirement and a younger workforce that too often lacks the technical proficiency to replace them.

Industry figures show that many pipefitters will reach retirement age within the next 10 years, with one recent study predicting employment for plumbers, pipefitters and steamfitters growing 21 percent from 2012 to 2022.

Hockstad said as many manufacturing jobs have left the country many young people don’t think of the manufacturing or chemical industries as career opportunities.

“We have lost a number of folks in that generation in the last 10 years who didn’t think of that as an opportunity but we’re definitely seeing that resurgence again,” Hockstad said.

“It’s like any other career, you climb the ladder but in this industry you’re climbing fast,” pipefitter Browning said.

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Rob formerly served as staff reporter for Watchdog.org.