Business & Economy

Why is it so hard to retrain laid off workers?

Former Century Plaza Hotel worker Edgar Castillo, right, takes part in a food handling class at the Hospitality Training Academy in L.A. in Dec. 2016.
Former Century Plaza Hotel worker Edgar Castillo, right, takes part in a food handling class at the Hospitality Training Academy in L.A. in Dec. 2016.
Maya Sugarman/KPCC

One of the few issues Democrats and Republicans agree on these days is that the U.S. needs to do a better job retraining laid off workers. Last month, the White House held a "workforce development week" to highlight the issue.

"[W]e're constantly hearing from CEOs that they have job openings but they don't have workers with the skill set they need to fill those jobs," Ivanka Trump said on Fox & Friends in an interview to kick off the week.

But a California-sponsored program to retrain hundreds of former hotel workers laid off last year when the Century Plaza in Century City closed demonstrates how difficult retraining is.

The state had high hopes for the program, which KPCC has followed for months.

"Workers who lost jobs when the Hyatt Regency Century Plaza closed will now receive targeted employment services to help get them back to work as soon as possible," California Employment Development Department Director Patrick W. Henning, Jr. said last July. 

But a year after the $800,000 state grant was issued, just 169 out of roughly 600 former employees have found new jobs, even as local demand for hotel workers is strong.

And for those who have landed new jobs, the city hasn’t tracked whether it achieved a major goal of the program – to move workers to higher-level positions than they had before.

"We've exceeded our expectations"

Those who oversaw the program say they are pleased with the results.

"We’ve exceeded our expectations in terms of our numbers," said Jan Perry, general manager of the Los Angeles Economic and Workforce Development Department.

"We’re just really thrilled," said Adine Forman, Executive Director of the Hospitality Training Academy Los Angeles. "I think everybody is pleased we met our outcome numbers on the grant. This is probably higher than any other project has had in Los Angeles’ history."

The program’s goal was a 70 percent rehire rate, which it exceeded by only counting the workers who signed-up for retraining services. Foreman said it’s not fair to count workers who didn’t show up.

"Usually when there’s a mass layoff like this people just scatter like the wind and it’s really hard to find them and for them to figure out how to get help," she said. 

Workers have been offered resume and interviewing workshops, barista training, food handling certification and a higher-level cooking course taught by Chef Mitchell Frieder. He said when he used to teach a similar class at a for-profit college the tuition was $38,000.

"This program is the entire first term from that school for free,' Frieder said. "I can’t imagine why we don’t have thousands of people in line for that program right now. It’s the oddest thing."

Frieder finds the low placement rate all the more baffling because three major hotels have opened downtown and in Beverly Hills in recent months.

"There are a lot of jobs out there but the employees are just not connecting up," Frieder said. "We definitely get it out to them. They know about it."

"We should worry that people aren’t showing up"

What happened with these former hotel workers is hardly unique, according to Joseph Parilla, a fellow at the Brookings Institution's Metropolitan Policy Program who studies worker retraining. 

"The reality is that retraining is very difficult," Parilla said. "The placement rates these programs have are generally lower than what the public expects them to be."

It can be a tough sell to convince laid-off workers that they can benefit from training and successfully transition to a new position, he said. That's particularly true in the case of the Century Plaza workers because many of them are older and could have decided they would rather retire than reenter the job market, added Parilla.

"The calculus around investing in a new skill set and changing careers looks a lot different if you're 60 years old versus 30 years old," he said.

The Century Plaza program would have been more successful had it started while the hotel was still open rather than months after it closed, said Parilla.

"As a society we should worry that people aren’t showing up," he said.

Turnout would have better if the Century Plaza program provided transportation and childcare, said Parilla. But all of that takes money, and the U.S. spends a smaller portion of its GDP on worker training than other industrial countries.

"Until we start to deal with that lack of investment in workforce training we’re going to continue having these types of challenging conversations about the quality of these programs and the outcomes they deliver," he said.

However, in the case of the Century Plaza program, funding doesn’t seem to have been an issue. In fact, so few workers showed up that the city only spent $180,000 of the $800,000 awarded by the state. The grant expired June 30, though the city hopes to get an extension to keep the program going.

"We expect given our metrics that the request for extension will be granted," said Perry. If it is, "we will expand this program to help other people who have lost their jobs," she said.