This category encompasses establishments primarily engaged in providing manpower training and vocational rehabilitation services for the unemployed, the under-employed, the disabled, and persons who have a job market disadvantage because of lack of education, job skills, or experience. Included in this industry are upgrading and job-development services, skill training, world-of-work orientation, and vocational rehabilitation counseling. This industry also includes offices of specialists providing rehabilitation and job counseling. Establishments primarily engaged in providing work experience for rehabilitates are also classified in this industry.
624310 (Vocational Rehabilitation Services)
American industry spent tens of billions of dollars to train its employees each year. As industry becomes increasingly global and technology becomes more sophisticated, employers demand that workers sharpen their analytical, decision-making, and communication skills. In order to remain competitive, businesses need to provide their employees with continuous training. Likewise, to become employed and remain employable, individuals must be, at the minimum, literate and skilled. For many individuals—including those with vocational disadvantages such as illiteracy, a criminal record, former substance abuse, or physical and mental disabilities—education and training is received through job training and vocational rehabilitation centers.
According to the U.S. Census Bureau, there were an estimated 9,707 job training and vocational establishments operating in the United States in 1998, with combined operating revenues of almost $2.9 billion for taxable firms. These establishments employed 336,800 workers. The U.S. Department of Commerce, Bureau of Economic Analysis, estimated that there were about 4,000 non-tax-exempt private vocational schools in operation, which posted about $7.4 billion in revenues. Estimates of the cost of private-sector training vary widely, due to differences in the methods used and the difficulty of collecting cost data.
Job rehabilitation and training were expected to remain an important component of industry well into the twenty-first century as technological advances necessitated enhanced skills from new and current employees. Corporate downsizing and rapid technological change in the workplace promised to focus more attention on building and retaining a skilled workforce. Training was a key element in that process.
Workers once considered to have sufficient skills for lifetime employment found themselves learning new skills and processes to sustain their employment in an increasingly technological work environment. According to the U.S. Department of Education, in 1997, 76 percent of students in grades 1-12 used a computer at school (up from 62 percent in 1993), and 45 percent used one at home (up significantly from 25 percent in 1993). By the beginning of the twenty-first century, a consequential number of both high school and college graduates used computers in their jobs. Technological growth raised the level of training required for the workforce in nearly all industries.
Based on the educational background of the unemployed and labor-market projections, the U.S. Office of Technology Assessment (OTA) found that a large segment of the U.S. labor force was fast becoming more prepared for employment in an increasingly high-tech workplace. Yet other groups, including the immigrants who made up 26 percent of the labor force growth in the 1980s and early 1990s, still had a need for more job training.
Additionally, employers and post-secondary institutions found that a number of high school graduates and college students needed remedial work in grammar, mathematics, and basic problem-solving skills before they could be ready for employment or college. As a result, efforts redoubled throughout the 1990s to ensure academic accountability through minimum proficiency requirements students had to pass to graduate. However, for those who had already been through the system and whose educational skills remained sub-par, job training and vocational rehabilitation services were designed to address needs for education and skill development and provide rehabilitative help and training for students and workers with insufficient knowledge and skills.
Nationally, the industry was composed of many small companies, a majority being non-profits and state-supported organizations. In the mid 1990s, the top 46 companies, which made up less than one percent of the total number of establishments in this industry, had sales of $1.03 billion. This figure represented approximately 25 percent of the entire industry's sales.
During the 1990s, however, there was a decrease in the number of state-run vocational rehabilitation service centers. In 1997, the U.S. Census Bureau reported 2,549 centers, compared to 2,643 in 1992—an elimination of 94 state centers. Speculation on the reasons for this was varied. Cutbacks in individual state spending and federal subsidies accounted for some of the decline. High technology in the workplace created a much more efficient system with which workers could be trained and/or retrained. That was a model employed by state-run program as well; many rehabilitation services were offered over the Internet and accessible from any computer.
Traditionally, training programs had been implemented in response to specific problems or situations, and little regard was given to previous programs or to the implications for the future. In general, most of the money spent on training programs went to programs for professional and managerial staff, ignoring other workers whose skill development would mandate more expenditure.
The number of individuals who lacked marketable skills fueled the growth of the rehabilitative and vocational training industry. Firms in this industry were formed as a result of the lack of training available to individuals without a college degree. Many of these companies operated on the premise that people would derive greater benefits from training programs if they were able to help themselves. This idea was the genesis of Goodwill Industries of America.
Goodwill Industries was started in the early 1900s by Edgar J. Helms, a Methodist minister working in Boston. Helms began collecting unwanted household items and hiring poor men and women to repair them for resale, and he paid workers through the sale of the goods. Goodwill Industries served not only low income people but also those with other "barriers to employment including physical and mental disabilities, illiteracy, homelessness, inadequate education, and welfare dependency." Goodwill Industries offered training in many fields, which ranged from computer programming to janitorial positions.
The passage of the Americans with Disabilities Act (ADA), which removed many employment barriers faced by physically disabled individuals, was expected to increase the number of clients served by training centers. Implementation of the ADA met with some resistance from employers who feared that they would be required to meet hiring quotas, and by employees who believed that physically disabled workers would receive preferential treatment in the workplace. The training and development industry worked to resolve these issues by helping to create and sustain supportive work environments for all workers. Training was well received when the trainers were sensitive to employee attitudes and encouraged open discussion.
Passage of the ADA represented significant growth potential for the training industry. In addition to providing training to employees, professionals in this industry found a market in corporations making changes to meet the federal regulations and needing insights about hiring and training physically challenged employees.
In August 1996, President Clinton signed and Congress passed the Personal Responsibility and Work Opportunity Act of 1996. The legislation ended a 61-year federal guarantee of aid to the poor, giving states the power to design their own welfare programs, imposing a five-year lifetime limit on receiving welfare, and requiring recipients to begin working within two years after receiving benefits. Childless, able-bodied people, aged 18 to 50, were limited to three months of welfare every three months. They were eligible to continue receiving food stamps on the condition that they secure a 20-hour per week job and participate in job training or volunteer programs. President Clinton promised to encourage companies to help welfare recipients find employment. In light of this welfare reform, businesses were increasingly focusing on the their roles in the education and training of adults, youth, and disadvantaged workers.
Continued corporate downsizing was another influence on the growth of the industry. As corporations continued to downsize their operations, they often demanded that remaining workers increase their performance and skill levels. More corporations required that job applicants possess high-level skills and that they cultivate these skills through on-going training. In manufacturing, for example, the tradition of using workers to perform routine, repetitive duties was being replaced by teaching employees a broader scope of skills and adding to their responsibilities. Companies were emphasizing teamwork and were cross-training their workers to make production more efficient.
The American Society for Training and Development estimated that nearly 50 million workers needed additional training just to perform their current jobs adequately.
Goodwill Industries of America was one of the world's largest leaders in the industry. Goodwill Industries is a nonprofit corporation that serves more than 126,000 clients annually through its vocational rehabilitation programs. Goodwill receives clients through referrals, of which the state vocational rehabilitation system and the public welfare system provide more than 50 percent. Nearly 25,000 of these clients were placed in competitive employment by Goodwill Industries in 1995. Salaries and wages earned by clients in that year totaled $261 million. These people had previously depended upon some form of public assistance, but with their newly achieved employment, they became contributors to their local economies and returned about $32 million in tax revenues to government at federal, state, and local levels. In 1996, Goodwill Industries encompassed more than 185 independent member organizations in the United States, Canada, and the Pacific Basin. In addition, the company worked with more than 50 affiliated International Goodwill organizations.
Goodwill's largest client group included people with such vocational disadvantages as illiteracy, past substance abuse, a record of criminal behavior, physical and mental disabilities, and a lack of work experience. People with mental retardation made up the second-largest group of Goodwill's clients. Goodwill Industries divided its vocational services into four categories: vocational evaluation, vocational adjustment, job-seeking skills and placement, and sheltered employment for those who could not realistically expect to succeed in a competitive environment. Goodwill also assisted clients with social adjustment training, and many of its facilities provided rehabilitation for persons with industrial injuries. In late 1999, The U.S. Department of Labor awarded Goodwill Industries International Inc. a $20 million grant to provide training and support to place men and women on welfare in career-building Census 2000 jobs. The grant was the result of Goodwill's partnership with the Census Bureau; their goal was to recruit and hire 850,000 employees to conduct the census, and to place Goodwill graduates in jobs.
Goodwill Industries funded its job training programs through store, salvage, and contract sales; rehabilitation fees and grants; and public support funds. This revenue went directly to job-training services, vocational rehabilitation, and equipment required by people with disabilities and other special needs. An average of 84 percent of all revenue raised by Goodwill Industries from the sale of donated goods supported job-training and rehabilitation programs. The other 16 percent went toward overhead costs.
Another industry giant was Lions World Services for the Blind (LWSB), sponsored by various Lions Clubs. LWSB was formed to teach people who are blind or visually impaired independent living skills or job training skills. In the United States, 1.3 million Americans age 25 and older have severe visual impairments, causing them to make adjustments in areas of careers and everyday living situations. Since its founding in Little Rock, Arkansas, in 1947, LWSB has served more than 10,000 individuals in the United States and 54 other countries. LWSB offers a variety of vocational training programs to prepare individuals who are blind or visually impaired for careers in both white and blue-collar jobs. By the turn of the century, LWSB offered 13 vocational programs, which included several courses that train students to work for the Internal Revenue Service. LWSB also provided a variety of other services, including a college preparatory program to prepare people for college work, job-seeking skills training, employer education workshops, job placement assistance on a selected basis, and in-service training for rehabilitation professionals.
According to the U.S. Census Bureau, the salary difference in taxed and tax-exempt establishments in this industry was significant in the 1990s. Workers in taxed organizations typically earned more than their counterparts employed by tax-exempt organizations. Based on limited information, starting salaries for these human services workers ranged from $13,000 to $20,000 a year in 1994. Experienced workers generally earned between $18,000 and $27,000 annually.
The industry relied on various instructors and workers to provide job training assistance to its diverse client base. Teachers and instructors in vocational education programs comprised a significant percentage of this industry's workforce, but other workers included counselors, social workers, and secretaries.
According to the U.S. Department of Labor, employment in this industry was expected to increase significantly by 2008. In 1998, job training and related services industry accounted for almost 370,000 workers; a 31 percent increase to over 483,000 workers was expected by 2008. When the 20th century ended, job training programs began to require more workers as the U.S. economy continued to grow at an unprecedented rate. Companies changed their mode of production more frequently, thus more workers needed to be retrained.
In addition to simply making corporations more efficient, job training is key to keeping the United States competitive in world markets. Skills training will enable American companies to exploit the benefits of available technology. Enhanced skills will be necessary to run advanced computers, including interactive software. Training will help close the gap between non-skilled workers and sophisticated technology.
With the exception of Goodwill Industries and Lions World Services for the Blind, most companies in this industry do not operate internationally. In general, training needs for vocational jobs vary widely from country to country. Many other countries have advanced systems of job training and apprenticeship. The United States relies heavily on on-the-job training, while European countries, particularly Germany, have more focused post-secondary education programs. Industry analysts expect that the United States will begin to follow Europe's example by establishing job-training programs in high schools and instituting a nationwide program of youth apprenticeship. Despite the attractiveness of a U.S. higher education to foreign students, the competitiveness of U.S. workers has declined compared with workers in some Asian and European countries because of weaker support for training and vocational education. These countries have used better-trained workers to shorten the production cycle and make incremental improvements in existing products, giving them a competitive edge over the United States.
The industry did not rely on technology to function, but rather trained its clients to make use of existing technology. Advances in computer software and systems were fast becoming a primary focus of the job training industry, as corporations demanded that their employees improve their computer literacy.
Bureau of Labor Statistics. "Table 1. Table A-1. National employment and wage data from the Occupational Employment Statistics survey by occupation, 1998." Occupational Outlook Handbook. Available from http://stats.bls.gov/news.release/ocwage.t01.htm .
U.S. Census Bureau. "Service Annual Survey; Selected Social Services, Tables 8.1 — 8.6., " 1999. Available from http://www.census.gov .