Time’s Up for Changing Kentucky Adult Education Conference, Lexington Feb. 5, 2008

2 A Personal Passion for Education and Manufacturing… Family Background Cultural Foundation Corporate Heritage Love of People

3 Manufacturing is Kentucky’s Economic Engine… Industry Sectors 2004 GSPPercent Manufacturing$2720 Government$2115 Real Estate$129 Health Care, Social Assistance$118 Retail Trade$107 Wholesale$96 Finance$75 Mining$32 Agriculture$22 * U.S. Bureau of Economic Analysis

4 Kentucky Manufacturing $100 Billion in Sales Ranked 4 th in U.S. High wages across Kentucky ($45K Avg. Annual Salary) Most jobs have excellent benefits

5 If Manufacturing Didn’t Exist 260,000 would be jobless or making a lot less money

6 If Manufacturing Didn’t Exist...

7 There are problems… Kentucky manufacturing is under attack from low-wage nations like China, India and Mexico… Our workforce needs high-tech knowledge… We are in danger of losing Kentucky manufacturers who can’t lower costs fast enough and can’t find qualified workers…

8 Member Survey Kentucky Manufacturers Speak Out About Their Greatest Concerns…

9 Workforce Development & Retention Lowering Taxes Fewer Regulations Controlling Costs Staying Competitive Controlling Wages & Benefits Global Competition Growing the Business Environmental Compliance Energy Costs

10 Why Can’t We Find Qualified Workers? 1. General Misunderstanding about Economic Impact 2. Old, Outdated Career Image 3. Declining Quality of Job Applicants

11 Challenge Number One: Many of our media, leaders and citizens don’t understand or recognize manufacturing’s IMPACT ON OUR ECONOMY or HOW IMPORTANT IT IS to our future… – Myth: “Dying Industry” – Reality: Output Increased in 2006

12 Most Legislators Don’t Understand… 54% of legislators believe industries OTHER THAN manufacturing contribute more to the Kentucky economy* 58% of citizens believe industries OTHER THAN manufacturing hold the key to our future * *Independent Poll

13 KAM’s Strategy to Change Economic Impact Misperceptions Broadcast Advertising - $2 million in radio and television advertising value across Kentucky in 2007 Print Advertising – Lane Report, Business First, Business Lexington Public Relations – 12 million message impressions a year

14 Challenge Number Two: Our leaders and citizens have an OUTDATED IMAGE of manufacturing and the CAREER OPPORTUNITIES it presents

15 Image of Manufacturing… Old Image (1960s) – Dirty, Hot and Sweaty – Low-Skill – Low Pay – Monotonous – Low-Tech – Un-Cool New Reality (2007) – Clean and Air- Conditioned – For ‘Smart’ People – Teamwork, Variety – High-Tech – Very “Cool”

16 New Poll of Kentucky Teachers…. In Cooperation with the Kentucky Council on Economic Education – "In general, is this career likely or not likely to provide a good opportunity for your students?"

17 KAM’s Strategy to Change Career Image Misperceptions Marketing Campaign – Phase One: Statewide Radio Commercials in 2008 – Phase Two: Under Development Partnerships – Big Brothers Big Sisters

18 Challenge Number Three: The QUALITY OF WORKER applying for advanced manufacturing job openings today is DECLINING

19 Applicant Quality Issues No high school diploma Can’t work in teams Can’t solve problems Can’t do math or read well Poor attendance Poor ethics (character, honesty) Drug, alcohol issues Poor work ethic

20 Future…The Looming Crisis Beginning in five years, Baby Boomers will begin to retire, leaving Kentucky advanced manufacturing facilities by the thousands

21 That’s Why KAM must have an aggressive VISION… By 2012, Kentucky will be one of the world’s most desired locations for manufacturers, both new and existing.

22 KAM’s Eight Branded Initiatives 1. ProsperousKentucky sm Keeping manufacturers in Kentucky and attracting new manufacturers here to raise the standard of living for all Kentuckians. 2. ProductiveKentucky sm Training Kentucky manufacturing workers to out-produce low-wage countries like China, India and Mexico. 3. FreedomKentucky sm Freeing our members from high taxes, regulations, and other constraints that prevent them from winning in the global marketplace. 4. SmartKentucky sm Preparing Kentucky students and adults for well- paying jobs in manufacturing. 5. HealthyKentucky sm Reducing Kentucky’s health care costs by encouraging our workers to be safe and healthy. 6. HonestKentucky sm Encouraging honesty and integrity in the manufacturing workplace. 7. CleanKentuckysm Helping our members balance sustainable growth with the environment and their communities. 8. MarketKentucky sm Helping our members market their products in a competitive global economy.

23 KAM’s Strategy to Change Worker Quality Problem (SmartKentucky sm ) Students (Secondary, Post-Secondary) – Legislation To improve career pathways; math, science and reading skills – Partnerships Kentucky School Board Association Big Brothers Big Sisters Kentucky Council on Economic Education KCTCS UK Center for Manufacturing Project Lead the Way – Marketing Campaign

24 Solutions? New Paradigm Shift in Education, both Secondary and Post-Secondary Pass Some Legislation Get Business Involved with Local Schools A 4-Year Degree is Great, But Not for Everyone Increase high school, technical and college graduation rates Technical Education = Good, Quality Jobs, RESPECT Find a Way to More Easily Qualify Retiring Boomers to Teach Technical Education Kentucky Culture: Break Some of the Old Paradigms

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