Darlene Miller, president and CEO, Permac Industries
help Minnesota improve preparation of young people for skilled jobs
Civic CaucusFocus on CompetitivenessInterview October 11, 2013
Paul Gilje (coordinator), Randy Johnson,
Sallie Kemper, Dan Loritz (chair), Darlene Miller, Dana Schroeder.
Darlene Miller believes
business and industry can make a difference in education. She says
most manufacturing jobs today require special skills and training,
including strong math skills. Experiencing herself the widespread
shortage of skilled workers for precision manufacturing jobs, she
shepherded the development of Right Skills Now (RSN), a fast-tracked,
credentialed education and internship program to train workers for
those jobs. The program is currently in place on one private and three
public community and technical college campuses in Minnesota and is
spreading to other states.
Miller believes that taxes in Minnesota,
especially property taxes, are too high and that the state's
regulatory system is "onerous." But, she says, that is balanced off by
the state's strong workforce, which, along with the strong supplier
network her company needs, keeps Permac in Minnesota. She's emphatic
that the quality of Minnesota's workforce is more important than any
tax incentive another state might offer to try to lure Permac to
But Miller worries that K-12 schools are not
preparing students adequately for the skills they'll need in the
workforce. She says many students are not well enough prepared to pass
the entrance exam to enter the RSN program, because they are lacking
math skills. She believes that cutting trade classes from high schools
may have contributed to a higher dropout rate, because those classes
helped many students understand why they should learn things like
Darlene Miller is president,
CEO and owner of Permac Industries, a precision parts manufacturing
company located in Burnsville, Minnesota. She got her manufacturing
jump-start at Honeywell. She later moved through the operational and
sales ranks with other employers, gaining the solid background she
needed to head a precision parts manufacturing company. She started as
a sales representative at Permac in 1992, became part owner in 1993
and full owner in 1994.
Since Miller's purchase of Permac, the
company has entered the global marketplace, especially in India and
China. In its present location since 1998, the company has doubled its
space to 34,000 square feet, including space for customer inventory
management, assembly areas, engineering and administrative offices,
and a quality control laboratory. Under her leadership, Permac won the
national 2008 U.S. Chamber of Commerce Small Business of the Year
Since 2011, Miller has been a member of the
President's Council for Jobs and Competitiveness, serving as co-chair
of the High-Tech Education Committee with Paul Otellini, former
president and CEO of Intel. In that role, she has shepherded the
development of Right Skills Now, a fast-tracked, credentialed
education and internship program to train workers for precision
manufacturing. In 2005, she founded the local chapter of Hope for
Tomorrow, a mentoring program that pairs business leaders with eighth-
and ninth-grade girls and boys to nurture tomorrow's leaders. In 2006,
she was named national U.S. Chamber of Commerce Small Business Person
of the Year.
Permac Industries is a precision parts
manufacturing company located in Burnsville. Darlene Miller,
president, CEO and owner of Permac, said the company has 25 employees,
with openings for more. Wages at the company range from $13 an hour to
more than $30 an hour. She noted that the company has a profit-sharing
program, distributing 10 percent of its profits. Fifty percent of the
profit-sharing pool goes to everyone who's eligible. Teams get 25
percent and 25 percent goes to individuals, both based on points
earned for reaching particular goals.
Business and industry can make a difference
in education. As a member since 2011 of the President's Council
for Jobs and Competitiveness and co-chair of its High-Tech Education
Committee, Miller said President Barack Obama challenged her and other
members to look at what their industries could do to make a difference
Miller took the challenge to heart. "All
I've heard during 25 years of being in business is that we can't find
qualified machinists," she said. "It's a complaint of mine and of
everybody I know. The talent just is not out there. It doesn't matter
what state you're in. I can visit anywhere and they have openings in
manufacturing. This is a worldwide problem."
Miller said schools were producing
machinists, but not quickly enough and not always with the skills
manufacturers needed. "There was a gap between what schools thought we
needed and what we really needed," she said. "Strong, strong math
skills were a huge part of that and some of the soft skills and
problem-solving skills, too.
Right Skills Now (RSN) is a fast-tracked,
credentialed, stackable credit program that is transferable from
company to company and from state to state. The key components are
the earned credentials and internships with manufacturers.
Several years ago, Miller approached Barb
Overshaw and E.J. Daigle at Dunwoody College of Technology in
Minneapolis about developing a fast-tracked, credentialed training
program for machinists. "I told them that I needed something today,"
she said. "We're all stagnated and can't grow our businesses." She
worked with Daigle to condense the program down from two years to 24
weeks, including an internship with a manufacturing business. "I want
them to be able to get a job when they get out," she said. They called
the program Right Skills Now.
As people get closer to graduation, prior to
going on internship, they have to earn the National Institute of
Metalworking Skills (NIMS) credentials, which certifies their
competency in skills very specific to manufacturing, such as milling,
turning, safety, math and blueprint reading.
"It's a win for the school that ends up with
a course supported by employers, and it's a win for employers, because
credentialed graduates will come with known skills," she said. "It's a
win for the students, because they'll have a job. They can stay with
the company and continue their education in the manufacturing sector,
and we'll pay them to do that."
At Miller's behest, workforce centers and
community colleges utilize a "silver level" National Career Readiness
Certificate (NCRC) test developed by ACT as an entrance test for the
program. Anyone who goes into this program has to pass this test; if
not, they can take remedial courses to get there, she said. "We want
the people in the program to succeed."
The RSN program is spreading to other
states. Miller said RSN is "still in its infancy. We're only in
four campuses now in Minnesota. But to have this kind of program
spreading across the country is good. It'll still take time." She
noted that there are similar programs in other community colleges that
are NIMS-credentialed and that RSN isn't and doesn't have to be the
only program of its kind.
Miller said she meets with quite a few
different colleges and business owners to tell them about RSN. "You
have to engage both schools and businesses," she said. There are 30 to
35 Right Skills Now programs in seven or eight states now. "The word
is really getting out," she said. The National Association of
Manufacturing (NAM) will help any college or community college to
start RSN and NIMS will help with the credentialing, she said.
The first Right Skills Now programs started
in January 2012. Dunwoody and South Central College, a two-year
community and technical college with campuses in Faribault and North
Mankato, initiated the program at the same time. And St. Paul College
recently started the program. The first RSN class had 20 to 24
students, with only two dropouts. The students' average age was and is
38, with people ranging in age from 18 to 54.
Most manufacturing jobs today require
special skills and training. Machinists need high-level math
skills, Miller said. "We need the brightest and the smartest. The days
are gone when you could get a job in a factory without training. Back
in the '70s, about 78 percent of manufacturing jobs were entry-level
jobs you could get after finishing high school. Now that same
percentage of low-skill entry-level jobs is in the low 20s. For the
most part, you have to have the higher level skills and training. We
have very few entry-level jobs. It's really changed from where we were
35 to 40 years ago."
Every student needs advanced education, but
not necessarily four years of college.
Miller said she made that point to President Obama after he had said
every student should have the opportunity to get a college degree. He
agreed with her.
We must change students' perception of the
importance of math skills early. An interviewer who is a retired
math teacher commented that eighth-grade girls saw no relevance to
math, until they got into home economics or wood-shop classes, where
they actually used the math. "You need to change their mindset by
sixth or seventh grade," he said.
Miller agreed. She described the dual
internship system in Germany, which starts when students are 11 or 12
years old. They spend two weeks every year at whatever type of
business or trade they're interested in. They don't go to university,
unless they're going to be a doctor, lawyer or teacher, until they
finish their apprenticeship. They train through the trades and then
they can go on to university, if they wish.
An interviewer asked whether high school
readies kids for the initial ACT entrance test to RSN. "My gut
reaction is no, because of the math skills," she said. "There is no
doubt" that needs to change for us to have a qualified workforce."
An interviewer commented that Minnesota's
Postsecondary Enrollment Options program (PSEO) could provide an
interesting way to penetrate the high schools. High school students
could use PSEO to participate in community college programs that
provide this type of manufacturing skills training, he said.
Cutting trade classes from high schools may
have contributed to a higher dropout rate. An interviewer
commented that a critical problem in Minnesota is the big gap for kids
who are underachieving. Miller said she thinks the problem goes back
to when schools stopped offering industrial arts, home economics and
any trade classes. "High school dropouts increased to 30 percent," she
said. "I think there's a correlation. Lots of people in high school
don't have the stimulation they need to understand why they are
learning certain things. And a lot of schools are teaching things the
kids are never going to use. Why are we teaching Greek mythology
instead of math? These kids need the stimulation, and to get that,
they need the awareness of what potential there is out there."
A strong workforce and strong supplier
network keep Permac in Minnesota. An interviewer asked about
Minnesota's foundational competitiveness in things like an educated
workforce, a good education system, infrastructure, higher education,
health care and transportation. "All those infrastructure things are
so critical to our success," Miller said. "We create five to eight
other jobs for each manufacturing job we create." And, she said, her
company needs other companies, which can be located anywhere in the
state, to do things like heat treating, plating, finishing and
tooling. Minnesota is strong in that supplier support and in all the
other services, like payroll and health care, she said.
"Are taxes too high?" she asked.
"Absolutely. We're punished as businesses by property taxes, but there
is the balance of the good workforce."
An interviewer asked whether Miller is
approached to move her business to other cities in Minnesota or to
other states. She said she's approached mainly by South Dakota, North
Dakota and especially Wisconsin, which does aggressive promoting. "I
think the workforce in Minnesota is so much better," she said. "The
work ethic here and the people here are so much better than in many
other areas. I have no interest in moving. I looked at Wisconsin years
ago, but I think we're better off here."
"I can't take my workforce with me," she
said. "The quality of the workforce is absolutely more important than
any tax incentive we might get."
Miller offered that it's sometimes hard to
see other companies lured to Minnesota by various local or state
government financial incentives. "But if I'm going to add 100 new
jobs, I can't go back to the city or state and ask for something like
a tax abatement," she said.
Minnesota's regulatory system is onerous.
"Over-regulation by both state and federal agencies is affecting all
of us," she said. "Why do we have to have both?" She said businesses
are punished by regulatory paperwork. It can take 40 hours just to
fill out paperwork to confirm that the company doesn't use any toxic
chemicals. "It's assumed we'll do something wrong and they're going to
catch it. We're considered guilty before we're proven innocent. The
people who come out are not really trained to do their jobs. They're
not educated as to what industries do. It's not always a friendly,
Permac doubled its space in 2008, but may
soon outgrow its current building. When asked if Permac has
expansion plans, Miller said the company doubled its space in 2008 to
34,000 square feet of space. "We're now at the max for this building,"
Miller said she gets along well with the
city and that it was very helpful with regulations when Permac did its
expansion. "The planning commission was a challenge," she said. "The
city council members were very helpful people."
Hope for Tomorrow is a mentoring program
that pairs business leaders with eighth- and ninth-grade students for
eight months. In 2005, Miller co-founded the local chapter of Hope
for Tomorrow. Each mentoring pair meets once a month, giving kids the
support of another adult in their lives, she said. The pairs are
matched randomly. Mentoring groups for boys and girls are separate.
"We work on self-esteem, confidence, leadership and career building,"
she said. "We take them to colleges and businesses and show them the
opportunities in their lives. We have seen transformations that are
just unbelievable." She added that 13 schools in Minnesota have the
program now and that Chattanooga is about to start one.
An interviewer summarized that
one clear message from Miller is that Minnesota needs to be more
systematic in preparing its young people for jobs that are available
and today we're not doing a decent job of that. "That is very, very
true," Miller said. "The other part is that business must be engaged
in helping make that happen."
Further, Miller said that her second message
would be that the burden of paperwork imposed by regulatory agencies
is overwhelming and has a chilling effect on decisions to invest in
new technologies that could create additional jobs.
The Civic Caucus
is a non-partisan,
tax-exempt educational organization. The Core participants
include persons of varying political persuasions, reflecting years of leadership in politics and
business. Click here
to see a short personal background of each.
David Broden, Janis Clay, Bill Frenzel, Paul Gilje,
Jan Hively, Dan Loritz (Chair), Marina Lyon, Joe Mansky,
Tim McDonald, John Mooty, Jim Olson, Wayne Popham and