Autocam is using funds made available by the Michigan New Jobs Training Program to pay Grand Rapids Community College for training nine new apprentice machinists with dollars that would have otherwise been paid to the state for withholding taxes. PHOTO: JEFF HAGE

By Kym Reinstadler | Knowledge
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WEST MICHIGAN — Six West Michigan employers are working with Grand Rapids Community College to develop customized training to prepare workers for brand new jobs. These agreements, funded through the Michigan New Jobs Program, will create 4,657 full-time jobs over time.

GRCC has emerged as the leader among the state’s 28 community colleges in forging agreements to fund training through the new program. The three-year-old legislation authorizes $50,000 million statewide at any given time. GRCC agreements currently account for $30 million with about $9 million undesignated.

“This program is being really well received by companies in growth mode,” said Mary Hofstra, GRCC’s senior programmer for training solutions. “It helps employers get the talented workforce they need without up-front costs.”

Tom O’Brien, director of the Lakeshore Business and Industrial Service Center at Muskegon Community College, just started pitching the workforce development incentive to area employers, but he said he expects a big response. Across the state, Oakland Community College announced three Michigan New Jobs Training Program agreements representing 322 new jobs in April.

In a nutshell, here’s how it works:

Companies moving to Michigan, or expanding operations in the state, partner with a community college to develop or arrange focused training.

The community college can self-fund development of that training for a specified number of positions over an identified period of time, or issue bonds to pay for it.

The debt is paid by capturing the incremental increase in the state income tax associated with the new employees’ wages and redirecting it to the college, instead of the state.

Advocates say the program creates a pay-as-you go training system where there are only winners. The state treasury can’t be considered a loser, O’Brien said, because new jobs are created.

“I think the role of training programs such as this one is significant and will become even more significant in the future,” said Amy Cell, SVP of talent enhancement at Michigan Economic Development Corp.

Michigan has historically relied on federal dollars for worker training. But federal funds typically target training workers with barriers to employment, like weak basic skills or cognitive or physical limitations. Today the state finds itself with prolonged high unemployment due to fundamental changes in its economy. What’s needed, Cell said, is narrowly focused, highly flexible training that’s integrated with the needs of emerging industries.

Alternative energies in particular offer exciting growth potential. Without worker training programs, companies cannot gain and retain a competitive edge.

Training programs must evolve rapidly to satisfy needs of companies using state-of-the-art technologies and identifying new markets. Colleges and companies have to work together to achieve that, Cell said.

“Having a workforce with the right skills at the right time is critical to being successful in the competitive global marketplace,” Cell said. “Community colleges are able to quickly bring together training resources efficiently and effectively and are great partners in workforce development.”

LG Chem in Holland has signed a $19 million project with GRCC to train 3,123 workers over 20 years. At the opposite end of the spectrum is Autocam of Kentwood, which has a $250,000 agreement covering 15 new positions.

Funds available through the program are determined by a company’s training needs and an estimation of the withholding taxes needed to pay off the debt.

“We’re a small player in this, but it is certainly helpful to us,” said Jim Wojczynski, human resources manager at Autocam, which manufactures precision metal components used in the automotive and medical industries.

Through the Michigan New Jobs Training Program, Autocam is paying the cost of training nine new apprentice machinists with dollars that would have otherwise been paid to the state for withholding taxes.

Since January, the apprentices have worked Monday through Thursday at Autocam and then have spent Fridays on GRCC’s main campus getting classroom instruction and hands-on experience in the applied technology lab.

Requirements for the Michigan New Jobs Training Program are complex, O’Brien said.

Foremost, the program can only be used to fund training for new positions or positions a company hasn’t had for a year or more. It can’t foot the bill for training incumbent workers on the job.

Agreements cover new positions, not specific workers. If an employee receives training then moves on, the original employer is still on the hook to repay money for the training.

If a company doesn’t add the jobs, it still has to pay back money the community college incurred for training.

Also, the new jobs must be full-time and well-paying – 175 percent of minimum wage. Currently, new jobs must pay at least $12.95 per hour.

“We don’t want anybody to be surprised or disappointed,” O’Brien said. “We’re spelling out very carefully what everybody’s responsibilities are.”

The Michigan New Jobs Training Program was championed by the Michigan Community Colleges Association. The legislation was introduced by Sen. Mark Jansen, R-Cutlerville, and Rep. Richard Hammel, D-Mt. Morris Township. Gov. Jennifer Granholm signed it into law in December 2008.

Michigan’s law is patterned after the Iowa New Jobs Training Program, which has provided flexible ways to meet training needs for new jobs since 1983.