Community Colleges and Employers: How Can We Understand their Connection?

• Author: Paul Osterman,Andrew Weaver
• Published date: 01 October 2016
• Date: 01 October 2016
• DOI: http://doi.org/10.1111/irel.12150

Community Colleges and Employers: How Can

We Understand their Connection?*

PAUL OSTERMAN and ANDREW WEAVER

This paper uses an original, nationally representative survey of manufacturing

establishments to shed light on the interaction of employers with community col-

leges, including information on skill requirements and human resource practices.

We test three hypotheses: that high-skill employers use community colleges, that

community colleges are a substitute for employer-based training, and that commu-

nity colleges are a complement to so-called “high-road”or “high-commitment”

human resource practices. We find limited utilization of community colleges by

employers, but those that do establish a relationship are generally satisfied.

Employers that demand high skills are more likely to use community colleges, as

are “high-commitment”firms.

Introduction

Skills are critical to economic growth as well as the economic fortunes of

individual workers and the American system of producing these skills has

changed over the past few decades. The balance between employer and

school-based training shifted and school and other external educational and

training institutions have grown in prominence (Weaver and Osterman 2014).

Community colleges in particular have moved to the center of public policy

discussions regarding efforts to upgrade workforce skills and restart job

growth. An illustration of these shifts is that in the past several years the

Obama administration has initiated several training initiatives that make com-

munity colleges the centerpiece (White House 2015). Indeed, President Obama

recently described his Community College To Career initiative in these terms:

“We’re getting businesses, universities, communities all to work together to

develop centers of high-tech industries all throughout the United States that

allow us to be at the forefront of the next revolution of manufacturing”(Fain

2013). In addition, numerous states utilize community colleges as the anchor

*The authors’affiliations are, respectively, MIT Sloan School of Management, Cambridge, Massachusetts.

Email: osterman@mit.edu; University of Illinois, Champaign, Illinois. Email: aweaver5@illinois.edu.

The authors are grateful to the Russell Sage Foundation for support for the survey underlying this paper.

INDUSTRIAL RELATIONS, Vol. 55, No. 4 (October 2016). ©2016 Regents of the University of California

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institution for assisting local firms with human capital and production chal-

lenges and it is now common for community colleges to establish a manufac-

turing program. At the core of these programs are efforts to link community

colleges more closely to employers.

Despite this focus, there is much that remains unclear about how firms inter-

act with community colleges to secure a skilled workforce. At a simple level

we lack, despite the widespread attention, a representative descriptive under-

standing of the extent and quality of the interaction between firms and commu-

nity colleges. We also lack a good understanding of the characteristics of

employers who work with community colleges and how these characteristics

differ from less involved firms. These characteristics may range from straight-

forward features such as size to more complex characteristics such as the nat-

ure of the human resource practices of different organizations.

It may also be the case that the occupational and workforce training that

community colleges provide is a substitute for internal employer training.

Businesses may seek to outsource this training for reasons relating to cost,

scale, or uncertainty about skill trends. On the other hand, it could be that

community college training is a complementary resource for firms that already

provide substantial levels of internal training. In this case, businesses may uti-

lize community college training not as a substitute for their own efforts, but as

an additional source of skill development that possesses unique characteristics

or advantages that the firm cannot easily replicate in its own training.

If community college training is mainly a substitute for employer-based

training, then the growth of community college training represents an

improvement in skills and productivity only to the extent that community col-

lege training is superior to internal corporate training. Training in this instance

is a bit of a zero-sum game. However, if community college training is a

complement, then the question becomes how to improve the fit between cor-

porate and community college efforts in order to maximize the value added of

each player.

If the first dynamic holds, we would expect firms that are most eager to

shed their internal training efforts to be the most frequent users of community

college training. If the second dynamic is stronger, then we would expect firms

that make more significant internal investments in human resource develop-

ment to be the most widespread adopters of community college training.

The goal of this paper is to utilize an original national survey of manufac-

turing establishments to shed light on the extent and quality of the interaction

of employers with community colleges. In particular, we seek to answer the

following questions. How widespread are relationships between community

colleges and manufacturers and how do employers assess the quality of their

relationship with community colleges? Second, do employers use community

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