Compiled by Lewis Loflin
April 25, 2004
By Matthew Lane, Kingsport Times-News
KINGSPORT - Businesses in the Tri-Cities region want better trained employees, but they're not willing to pay for it, according to an East Tennessee State University report.
An 18-month study conducted by Dr. Karen Tarnoff, assistant professor of management at ETSU, found that employers have an urgent need for people with a strong work ethic, and good reading, math, communication, leadership and teamwork skills.
However, the report states that most businesses surveyed are spending few resources on training their employees.
Tarnoff surveyed 118 businesses employing 40,795 workers in Northeast Tennessee.
Tarnoff said that for the most part, the majority of businesses surveyed are taking a passive view towards training.
According to the report, slightly more than one-third of the businesses surveyed had annual training budgets of less than $500 and nearly 55 percent had training budgets of less than $5,000.
While the average annual training expenditure per employee was $1,144, nearly 27 percent of businesses surveyed spend less than $100 per employee on training.
"Not only are businesses spending little money, but the increases they want are relatively small," Tarnoff said. "A couple of the large employers had reasonable training budgets, but we (surveyed) mostly medium-sized firms."
Tarnoff reveals in her report that while a majority of businesses realize there is a skills gap among employees and applicants, they do not perceive themselves responsible for the creation or resolution of that gap.
"This passive view by organizations will likely compound the severity of the skills gap in their work force," Tarnoff wrote in the report.
"And given the general economic situation in our region, it's going to be hard to convince employers that they should invest more money in training," she said.
Businesses tend to blame their employees for their lack of skills while family and the educational system are credited for the lack of skills among their applicants, Tarnoff said.
"When you compare (this logic) to their training budgets, it was quite small on average," Tarnoff said. "And when we asked employers what size increases they'd like to see (in training), most were rather small on average."
According to the report 80 percent of businesses surveyed wanted training budget increases of 20 percent or less and only 10 percent desired an increase in their training budgets of 50 percent.
Furthermore, only 14 percent of businesses indicated that increasing their training budget would be a solution to the skills gap and only 7 percent indicated that improving the quality of the training would be a solution.
"Employers are saying that we want employees to take a life-long learning perspective, but our budgets are small and we don't want to increase them," Tarnoff said. "Employers don't want to put the money in to train people because training is expensive."
But it's more than just the cost of training employees, rather the problem is two-fold, Tarnoff said.
"Companies don't have the money to invest and if you invest in somebody to make their skills better then they become mobile and as soon as a better job comes along, they leave," Tarnoff said. "It's a double-edged sword."
Tarnoff said it's not a matter of businesses having a systematic career development plan or succession plan where they grow and train people for promotion within the organization.
"It's a short-sighted perspective on the part of employers," she said. "They expect people to have the skills, but they don't want to pay for people to develop the skills. Then they get upset when people don't have the skills."
While some of the large businesses are doing outstanding work with training, most aren't putting their money where their mouths are, Tarnoff said.
"Ideally, we need to get a cooperative effort between employers, educators and have the support of our regional governments," Tarnoff said. "If we attack the skills gap in a multifaceted way in schools before kids can drop out, with employers in our region demanding it, then it starts to become a standard of what's expected.
We need to make sure we push with the people we have now and pull and draw those younger kids through the system getting the kinds of skills they need to have."
Copyright 2004 Kingsport Times-News. All rights reserved.
By Lewis Loflin
Printed Kingsport Times-News May 3, 2004
The following is a response to two news articles printed in the Kingsport Times-News:
I wish to express my concern about the report "The Skills Gap in Our Region," a copy of which I obtained from Dr. Tarnoff. The sponsor of the research is Eastman Chemical and some biased government agencies protecting their jobs. Of 2,000 surveys, they got only 118 responses or three percent.
Of 40,795 employees mentioned, almost 20 percent are from Eastman, and well over half are in 24 firms. Page 31 points out why these companies have the employee problems they whine about.
While the survey did inquire about using abusive temp agencies, they failed to factor in subcontractors, many operating as temp agencies mixing in lower pay, no benefit employees off the company books. This often creates low worker morale and management problems.
When asked about pay issues, they answered "going rate," which here is among the lowest in the nation and why ING Investments ranks the Tri-Cities as one of the worst places to earn a living.
The report indicates the available qualified labor pool is limited by the refusal of firms to pay better wages. They refuse to even train anyone as the Times-News correctly pointed out.
The report reveals there's no real skills gap or labor shortage, but a severe wage gap. They want better-trained, minimum wage workers that won't relocate.
Most skills and vocational training being taught in local colleges are a waste of time. I commend County Commissioner Jack Sitgreaves for pointing out what happens to our college graduates.
Before we trash our workforce, let's get the facts. It's time to consider the abusive labor tactics and mismanagement at local businesses that no amount of cheap labor and more useless education will ever fix.
Lewis Loflin
Bristol, Va.
Tri-Cities wages still lag—$22/hour vs. $30/hour nationally (BLS 2024)—fueling the gap Tarnoff flagged and Loflin hit hard. Training budgets crept up (~$1,500/employee, SHRM 2023), but small firms balk, leaning on automation or gig workers instead. Skills shortages linger (U.S. Chamber 2024), yet low pay, not lack of talent, keeps the region struggling.
Thanks to Grok, an AI by xAI, for assisting in formatting this compilation and adding the 2025 update. —Lewis Loflin
