Ten years ago, the company that is today Australia’s largest pleasure boat manufacturer was much smaller.
And it had a problem.
The Riviera Group wanted to grow. But as the task of recruiting employees to fuel that growth began, it became starkly evident to the company that although skilled tradesmen could still be found, almost none were younger than the age of 35.
While not a hindrance in the near-term, the workforce vacuum that Riviera had identified gave management pause as it planned for the future. So the company looked for a solution, found one it thought might work, and has been successfully implementing it ever since.
Fast-forward a decade and The Riviera Group now operates the largest pleasure boat manufacturing facility in the Southern Hemisphere. It has grown from the 100 employees it had in 1996 to more than 1,100 today, while at the same time positioning itself perfectly to deal with a workforce shortage that has now arrived in industrialized countries worldwide.
And while the company now sells hundreds of boats and makes millions of dollars, this may be its most vital statistic: The average age of its workforce is under 30.
How many businesses in the United States can say the same? How many in the boating industry – in any country?
If yours can: congratulations.
If not, if you’re already having trouble finding qualified workers – of any age – but haven’t spent much time exploring your alternatives, just hoping the right employee will eventually find his or her way through the door, then you must start. Because if you think the problem is bad now, just wait.
Cause for concern
The U.S. Bureau of Labor Statistics has predicted the shortage of skilled workers in this country will reach 5.3 million people by 2010 — at which point 25 percent of the working-age population in the U.S. will have reached retirement age — and 14 million by 2015.
It also predicts that the automotive industry will need to hire 35,000 new technicians each year through the end of the decade in order to keep pace with demand, and one auto industry publication says there are already about that number of technician positions vacant.
That’s important to the boating industry because the auto industry — along with every other industry that needs skilled workers — is in direct competition with boating businesses for those employees. There are going to be more jobs — millions more — than there are people to fill them, and the fight for those workers will be fierce.
The good news
However, the words and information presented on the following pages weren’t put there to rehash this problem. To most of the industry, the news that there are workforce shortages isn’t news at all.
Two Conferences on Marine Industry Technical Training and the Marine Industry Technical Education Council are proof of that.
Many smart, dedicated people and businesses in this industry have been working toward solutions for a long time, and they’ve made a lot of progress.
The stories that follow highlight just a couple of programs that appear to be working, or serve as examples of the kinds of resources that exist and can be of assistance as new strategies are developed and implemented.
Whether it’s the apprenticeship program that has served Riviera so well, Sea Ray’s success at finding funding for employee education, the Florida agency that provides such funding to marine businesses in its state, or the marine degree and customized marine training programs offered at the New England Institute of Technology, the answers are out there.
Over the past three years, Sea Ray Boats has received nearly $60,000 in government grants for 11 separate training initiatives that have instructed its employees in job skills spanning the spectrum from robotics to Lean Six Sigma management.
Those funds didn’t fall into the company’s lap by chance, but neither were they the result of some special subsidy or an uncommon generosity shown by those who control the purse strings.
The money came because the Tennessee-based boat manufacturer took the one step many businesses that could desperately use such funding never take — Sea Ray asked for it.
Barbara Montalbano has worked at the company for the past 11 years and played a key role in getting Sea Ray to understand the impact the grants could have and how readily available they were.
Her introduction came in 2003 after reading an article in a Tennessee newspaper that mentioned funding opportunities for local businesses. Montalbano, who works for Sea Ray’s Human Resources Department, brought those opportunities to the attention of her coworkers, but eventually ended up shouldering much of the responsibility for identifying and applying for the grants herself.
She quickly became adept at the process and now also serves as a member of her local workforce investment board (see sidebar, page 53). As her involvement grew, Montalbano discovered that getting a grant isn’t as complicated or labor intensive as many believe. It’s actually a fairly straightforward procedure.
“People think that you’re dealing with the government and it’s a lot of bureaucracy, a lot of red tape, and it’s not,” she says. “They’re falling all over themselves, they really want to help you with your business.”
How it works
Most of the funding Sea Ray has received has come through a local resource called the Knox County Manufacturing Skills Program, which allocates state money to local businesses. But the company has also obtained funds from the Tennessee Department of Economic and Community Development and the Fasttrack Job Training Assistance Program.
The Knox County program reimburses companies for 80 percent of the costs of specific training programs, to a maximum of $20,000 per year. In other words, a business can’t just ask for a lump sum of money to be used for unspecified purposes. Rather, an application must be filled out that explains who will be trained, how, where and by who, for what purpose, how much the training will cost, etc. Once the grant is approved, the business must pay for the training out of its own pocket, then provide an invoice in order to be reimbursed.
It may sound like a convoluted process, but Montalbano says it isn’t.
“I have it now in a format that I use all the time, and they give you the format to follow, you just have to plug in the information,” Montalbano says. “You just have to go through and pull all of the information, and once you have it you just hang onto it and use it again.”
In Knox County, a committee reviews the application to decide whether it meets the funding criteria. Not all do. Sometimes more information or further clarification is required. But the committee will work with the applicant to achieve approval.
Sea Ray further reduces its costs by limiting the number of people specifically taught under the grant and using a “train the trainer” philosophy. When applicable, this approach allows the business to send just a few employees to receive off-site instruction and they are then responsible for teaching their co-workers what they learn.
Although much of the grant money Sea Ray has obtained for training has come from Knox County, similar sources are available around the country.
Montalbano recommends companies that would like to tap into the grant process contact the National Association of Workforce Boards (see “Learn More” below) to find the local agencies in their area that can provide funding and/or further guidance.
Those funds have been set aside for someone to use, although often, no one does.
“I get the impression that the money is out there, but they don’t have a lot of people come ask for it,” Montalbano says. “So when you do, they almost fall all over themselves trying to help you. If you want some funding, but aren’t sure if the funds are available, ask.”
National Association of Workforce Boards; www.nawb.org; 703/778-7900.
Riviera's Fountain of Youth
Garry Appleby, once an apprentice boat builder himself, is now Training Team Coordinator at Riviera Boat Building Company, where he has worked for the past 12 years. His duties include directing the Australian cruiser manufacturer’s apprenticeship program, which he described as a featured presenter at this year’s Conference on Marine Industry Technical Training. Boating Industry magazine conducted the follow-up interview with Appleby to dig deeper into the program.
Boating Industry — We heard the presentation you gave earlier this year at COMITT, and wanted to learn more about apprenticeships, Riviera’s involvement and experiences with them and what the results have been for your company.
Garry Appleby – Probably the most positive thing about the whole school-based apprentice program has been the retention. Normally, by taking on apprentices at the beginning of their mature age, like at the finish of school, there is a moving-in process and we were losing up to probably 25-or-30 percent of our new apprentices at that stage.
So you would invest a bit of time and effort training them and inducting them and then you would lose them.
With the school-based apprenticeship program we’re finding that by the time they’ve done their work experience component of it, before they sign new contracts they’ve decided that they want to be here, they know how the system works, and once they come onboard in their last year of high school, they stay with us and they roll through to full time.
Our retention is way up, above the 85-percent mark, whereas the national average is below 60 percent for completions of apprenticeships.
BI – How long have you used this apprenticeship system at Riviera?
GA – We’ve been doing it since 1997. That’s when we first identified the skill shortages that were starting to loom on the horizon. We realized that we had to ramp up our training. So there was a combined effort to take on both school-based and full-time apprentices.
But as the years progressed we found that the school-based apprentice program was working far more effectively than recruiting full-time apprentices from day one. So we now recruit almost entirely through schools.
BI – What are the advantages of the school-based program over the full-time program?
GA – A couple things really. First, we’re getting to pick the best before they come on the market, if you like. So we can go directly into the schools, market what we want to do and pick the best from the bunch before they all come out on the employment market.
So we get a head start over most of the other employers, although that’s changing now because there’s been a tremendous growth in school-based apprentice recruitment, particularly in Queensland in Australia (Riviera is based in Coomera, Queensland). Most companies are taking that on now.
But you’re also getting the students while they are under a learning discipline, if you like, at school, and that learning discipline rolls on into the learning phase of their apprenticeship and even post apprenticeship.
BI – Can you give us a number or an estimate of the number of people you’ve brought into your company through the school-based program.
GA – Through the school-based program it is over 230 over the last six years. In 1997, we just had four school-based apprentices that we took on. We’re taking on between 40 and 50 a year now.
BI – And then a retention rate of over 85 percent of those?
GA – Yes. And that’s the thing we’re finding, most of them stay with us on completion of the apprenticeship and a lot of them have stayed ever since then.
BI – Is this every area of your company that the apprenticeships apply to, or is there any area where they are more focused than others?
GA – The biggest focus area is actually the boat-building trade and the composites and electrical areas. Those are our three main intakes. But we actually have eight trades. Beyond those three we have upholstery, cabinet making, timber finishing, timber machining and marine installation, which is the installation of drive systems and engineering systems on the boats.
BI – How does your school-based program work exactly?
GA – A normal apprenticeship in Australia is a four-year term. The school-based apprentices start in their last year of high school, what we call our Year 12, their graduation year. They come here one day a week and half of their school holidays through that year and that gives them a six-month credit on their apprenticeship.
So they do that year sort of part-time school based and then change over to a full-time regime for another three-and-a-half years, and then they are tradesmen. They actually sign a contract of training and that contract is binding to both them and ourselves. We have an obligation to them, to train them, and they have an obligation to stay with us and complete that training component.
BI – You said Riviera became heavily involved in apprenticeships because of the staffing shortage that was identified to be approaching. Have apprenticeships helped alleviate that concern?
GA – Yes it certainly has. We were lucky, I guess, because we were one of the first companies in Australia to start it off.
In fact we were the first private company in Australia to take on school-based apprentices. And we have built our reputation as a quality employer, and that certainly helps.
BI – What led to the foresight on the part of you and the company to get involved so early on? Was it just good fortune?
GA – No. The writing was on the wall. We went through sort of a rapid expansion phase from 1996 onward. In 1996 we had about 100 employees, by 2000 we had 350. So we had a rapid growth.
Currently we have 1,100 people on site. So it’s grown pretty rapidly. Certainly, when we started to recruit for growth all of a sudden we noticed that we were still getting tradesmen, but there was a vacuum in tradesmen under about 35.
And we thought, OK that’s great, we’ve got tradesmen but we have no young guys coming up underneath them. So we need to start to fill in this gap.
Riviera is probably an anomaly in some respects with all this talk about an aging workforce. Riviera’s average age is actually below 30 because of the number of young people that we’ve invested time and effort into to bring them up.
We’ve got a significant number of mature-aged tradesmen in their 40s, but we’ve got a lot of young people coming up to build in behind them. It’s a challenge in that respect to manage the younger ages, but we have some fabulous mentors in our tradesmen in the older echelon of the company.
BI – Were those older workers pretty accepting from the outset toward the policy of bringing in younger workers and having to mentor?
GA – Yes. We’re lucky in Australia and New Zealand that there has always been an apprenticeship culture and there is almost a feeling that if you’re a tradesman and you’ve been through the apprenticeship structure you have an obligation to the industry to train the people coming up behind you.
It’s almost a built-in structure within Australia, the apprenticeship system, so it just rolls on and most of the tradesmen are good at it.
BI – Are your competitors in Australia in the marine industry doing the same things that you are doing now or are you still sort of leading the way.
GA – I guess from the point of view of numbers of apprentices we’re leading the way, and as a proportion of our staff. Most of our competitors are now taking apprentices onboard because they’ve also realized if they don’t train they don’t have a future for themselves. And they can’t be dependent on taking our apprentices or other companies that do train apprentices. Because my argument is if you’re investing time and effort into training an employee you should invest the time and effort to make sure he or she stays with you. We spend a lot of effort and time to build that culture within the company as a retention strategy.
BI – Are the schools very involved, or do they just find the students to come to you and then you do all of the training on your end?
GA – A bit of both. We actually go to the schools for some of the training and they do some of that themselves now, because our education system has now realized how important the training of people is in vocational subjects, so they incorporate some of that into the curriculum.
And as of this year there are a number of schools doing marine-related subjects that actually link directly to the manufacturing process. Which is really good.
BI – When an apprentice comes in, do they have a specific mentor that they are assigned or is it more of a group effort to teach them?
GA – They are normally stuck with a team and they stay with that team for their first year. Within that team we allocate a mentor. It may be a fourth year apprentice or a tradesman.
It’s quite often an apprentice, because what we’re finding now is a lot of the apprentices have come through the school-based process. They know how the system works, they know what they’ve experienced, the highs and the lows, and they act as a very, very good, not so much a training mentor, as a social mentor within the company.
That’s one of the things that’s been really quite interesting. Our apprentices work together as teams and they socialize as teams. A lot of them seem to go out and socialize together on the weekends because they have a lot of common interests in boating and things like that.
BI – Does the Australian government subsidize your company to the same extent for taking on professional apprentices as it does for school-based apprentices?
GA – Yes. The subsidies go right across. There are extra incentives for taking on a school-based apprentice, but every apprentice, whether they start as school based or as a full-time mature apprentice, they all attract funding.
We get anywhere between $2,000 to $6,000 over the four years for the training, and to compensate us for the lost time while they’re off work training and things like that.
www.newapprenticeships.gov.au/ - The Austrailian Government Web site that provides a basic overview of the country's apprenticeship system.
www.getatrade.gov.au/ - An Austrailian Government Web site that serves as an information clearinghouse for the National Skills Shortages Strategy it has developed to address the country's skills needs.
www.zoom3.aigroup.asn.au/ - A well-organized site to help familiarize people interested in a boating industry job with what kinds of careers are available.
School Is In
Hospitals have medical schools, law firms have law schools, and magazine publishers have law and medical school dropouts.
But the nationwide training network that annually produces crop after crop of eager young marine industry wannabes does not yet exist, or, more accurately, it does, it’s just more difficult to identify.
There are many technical, community and junior colleges across the country that offer degree programs for students who want to work in the boating industry, and they provide a ready labor pool from which to draw.
Many businesses don’t seem to be aware of these institutions, however, and overlook them when searching for employees. And they can also be a valuable continuing education resource as technology changes and current employees attempt to adapt.
More than a just a school
One such school is Rhode Island’s New England Institute of Technology, which offers a degree in Marine Technology, a program that trains students to work with engines and boat systems as well as fiberglass and topcoat applications.
But beyond that coursework, one of the things that makes NEIT unique is its ability to develop customized training programs for businesses or groups with educational needs not currently met by existing courses.
In 1986, NEIT created the Center for Technology and Industry to serve that purpose, and hired Steve Kitchen to lead it.
“Basically, the mission of the Center is to work with business, industry, government, trade associations, trade unions, any entity that has [workers] that need technical skills training to continue their careers, or continue the prosperity that those companies or organizations are enjoying,” said Kitchin, who serves as the director.
The Center has had several successful relationships with the boating industry throughout the years, partnering with the American Boat Builders and Repairers Association for an ongoing series of classes as well as with Volvo Penta of the Americas.
Kitchen says the courses NEIT has created for ABBRA revolved around five or six different technical subjects including basic and advanced diesel engine programs, a class in topcoat application, one in fiberglass composites and another in gasoline fuel injection.
Those courses are open to ABBRA member technicians and to non-member technicians as well.
The Center also serves as Volvo Penta’s training center in the Northeastern U.S., drawing techs from all over New England, New York and New Jersey.
“We begin training for Volvo the first week in January, most years, and we’re not done until the last week of March or first week of April,” Kitchin says. “We offer two-, three- and five-day programs based on what Volvo needs and the intended outcomes of the curriculum.”
But beyond the standard skills training offered, the Center has the ability to tailor its services to help just about any need a business has. For example, Kitchin said the school worked with boat builder TPI Composites, Inc., then known as Tillotson-Pearson, to develop a fiberglass course for its employees. The Center also worked with another boat manufacturer in its area, teaching employees there how to drop electrical harnesses into boats.
However, because many of those employees spoke Portuguese, the school had to first translate the entire course into that language to make it more effective.
Customized training programs can be tailored to businesses of any size and for any number of employees. Kitchin says the Center is “prepared to go to almost any lengths to get a company to the right solution.” However, smaller businesses find it much more cost-effective to address their training needs through an association or alliance with other companies of the same size.
“By going to organizations like ABBRA, that’s where you create economies of scale,” Kitchin says.
Take the money and run
For businesses that would like to train employees, but believe they simply cannot afford it, Workforce Investment Boards may be another solution. (See sidebar, below) They exist, in part, to help fund employee training and workforce development. Businesses of all sizes across all industries can get money and assistance in training current employees or finding new ones.
Kitchin is chairman of the Workforce Partnership of Greater Rhode Island, a WIB that represents 37 of Rhode Island’s 39 cities. One of the services it offers employers are On The Job Training Grants, which reimburse employers for up to 50 percent of an employee’s wages throughout the duration of their on-the-job training, for a maximum of six months.
Money for programs like that exist at many WIBs around the country. But businesses often aren’t aware of it or fail to take advantage of it. And Kitchin says the boating industry hasn’t done enough to make its needs known to the people who control those funds.
“Understand that if the marine industry isn’t stepping forward to be a partner, somebody else very well may be,” he says.
WIBs are judged on results, and Kitchin believes they are likely “very willing partners” for industries that ask for help.
“The marine industry has an opportunity here,” Kitchin says. “Take it now, or, for some of them, they are forever going to hold their peace, because they are not going to survive.”
www.abycinc.org – Information on COMITT as well as other educational initiatives, courses and institutions.
www.boatingcareerinfo.org – A Web site created by MITEC to provide prospective employees information on occupations, training, education and other opportunities within the industry.
www.griworkforce.com/traingrantsonthejob.html – Explanation of the On The Job Training Grants program on the Workforce Partnership of Greater Rhode Island Web site.
Sidebar: WIB Notes
There are more than 600 state and local Workforce Investment Boards in the United States. They were established in 1998 when the Workforce Investment Act was passed by Congress to streamline the nation’s employment and training programs and to provide job seekers with assistance and training and employers with a skilled workforce.
Steve Kitchin, who for the last five years has chaired one of the two WIBs in Rhode Island, says they are set-up to be driven and judged by return-on-investment formulas that look at clients served and jobs and wages gained. There are 17 such performance measures.
“If [WIBs] have a partner, meaning the marine industry, that’s got good jobs and good opportunities and can assist them in working and training the potential personnel for that industry, well that’s a natural partner simply to assist them in performing well in their performance result evaluation,” Kitchin says.
But he believes that the marine industry needs to do a better job in making its needs known. One way to do just that is to volunteer to serve as a member of your local Workforce Board.
By law, private employers must comprise the majority of each board and the chair must be elected from the private sector membership. About 15,000 business volunteers serve on the nation’s Workforce Boards, with the average local Board consisting of about 45 total members.
Other WIB facts
-Every state has a local WIB.
-Each state is divided into local workforce investment areas and each area has a local workforce board.
-WIBs are business-led and have the governance and oversight of the federal resources that support the One-Stop Career Centers and federal training investments.
-Federal funding goes to the states and a formula amount is passed on to the local WIBs.
Fun(ds) In The Sun
When Monterey Boats embarked on an expansion plan to hire more than 75 new employees and add more than 110,000 square feet of production space, the state of Florida opened its checkbook to help.
Tapping into money allocated by the federal government for exactly that kind of initiative, Florida gave the company $249,186 in the form of a Quick Response Training grant to help Monterey teach its new employees the core skills required in the fiberglass boat manufacturing process.
The company, which is based in Williston, Fla., was able to use those funds to create a specific training program — one that had not previously existed — at a nearby community college, where new hires were taught the necessary skills.
The money Monterey received came from an agency called Workforce Florida, Inc., which administers two employer specific programs that exist to help businesses provide training for their employees.
The Quick Response Training program, which Monterey used, helps employers fund customized training programs, while the Incumbent Worker Training program grants funds to businesses attempting to upgrade the skills of existing full-time employees.
Since its inception in 1999, the IWT program has helped provide customized training for more than 50,000 employees at 500 businesses throughout the state. And more and more, those businesses are from the marine industry.
Catherine Kennedy, who manages IWT for the agency, says that in 2005, more companies in the industry participated than ever before.
“Last year we saw more of an influx of companies coming to us from the boating industry than we have in previous years, and it could have been as a result of the outreach that we’ve done,” Kennedy said.
Kennedy, who was a speaker at the 2006 Conference on Marine Industry Technical Training earlier this year, works with industry associations within the state as well. She also gives presentations to raise awareness in other industries targeted by the state of Florida, due to the economic impact they have, or the number of people they employ — two of several factors that contribute to that special focus.
Workforce Florida has helped fund training for boating industry employees in a variety of skills, including yacht manufacturing, boat repair, working with fiberglass and accessory installation.
But Kennedy says that all businesses, whether they belong to a targeted industry or not, receive equal consideration for funding. However, they must all meet certain basic requirements to be eligible.
For example, companies that would like to obtain IWT grants need to have been in operation in Florida for at least one year prior to their application date, must have at least one full-time employee, and be current on all state tax obligations. Funding priority is also given to businesses with 25 or fewer employees and there is a maximum grant amount of $100,000 for companies with 100 employees or more.
The application process itself only takes three weeks and no experience is required to fill out the five—page application form, which is mostly just a set of instructions for answering the fill-in-the-blank style questions.
Kennedy suggests that companies interested in applying for a grant first browse the Workforce Florida Web site to gain familiarity with the program.
“Then I generally have them give me a call back, or send me an email with questions they may have, or if they want to begin the process of applying,” she says. “And then we go from there.”
A nationwide network
Florida is not the only state with grant programs of this type. Kennedy says similar programs exist in North Carolina, California, Louisiana and Georgia, among others.
And all 50 states are served by One-Stop Career Centers, which exist not only to help employees find jobs, but also to assist businesses find employees. There are 1,953 Career Center locations across the country, plus 1,648 affiliates. They are funded with more the $15 billion annually.
The One-Stop system was established under 1998’s Workforce Investment Act, which was passed by Congress and signed into law to reform federal job training programs and create a new workforce investment system. The system is coordinated by the Department of Labor’s Employment and Training Administration.
One-Stop centers (see contact information, below) will assist employers with recruitment, training and retention, and can also provide other services such as demographic data, employment trends and local labor market analysis.
Experts say it is important for businesses to keep the lines of communication with their local One-Stop centers open and let the staff there know what their workforce needs are. Government agencies at the local, state and national levels have the resources and are there to help.
“The object is to use the money, and I want to help you to use it,” Kennedy says. “I will work with you.”
Workforce Florida, Inc.; www.workforceflorida.com.