Kris Singh, CEO of Holtec in Camden, raised a ruckus this week when he complained to a local publication how hard it is to find workers in his new city because "they can't stand getting up in the morning" and have "no tradition of work" in their families — drawing fire from activists, as well as sympathy from some employers.
Executives from around the Philadelphia region have voiced similar complaints about hiring, although their companies didn't get the massive $260 million tax breaks that Holtec International received to move into Camden about a year ago.
Kevin Walling, chief human resource officer of the Hershey Co., told a trade group this week that the skills gap is a critical issue for the chocolate company. "The economy is hot, unemployment is low, and the skills gap is wide," he said. "We have an aging demographic. We have a skill shortage that is not in tune with the current needs of a digital industry. Without taking proactive action in how we're developing the next generation of the workforce, we will be at risk."
The Chamber of Commerce in Southern New Jersey found for the first time that hiring qualified workers was the top issue facing its 1,100 members, according to a 2017 survey.
"Usually, it's overregulation or health-care costs, but we are consistently hearing this is a developing problem from all industry sectors," chamber vice president Christina M. Renna said.
Singh told ROI New Jersey magazine in late August that "we make sure that people here don't feel that they are somehow not part of the mainstream. In my eyes, they are all equal, they are all extremely important."
This week, however, his comments were overshadowed by the second part of the same interview, in which he spoke about the difficulty of hiring in Camden: "People don't have the skills," said Singh, whose company had a ribbon-cutting ceremony last September for a manufacturing facility and design center to make components for a small nuclear reactor.
Singh, one of the region's most successful entrepreneurs, wants to triple the workforce at his energy-equipment manufacturing company from about 450 now to 1,500 in 2020. But, he told the publication he was confounded by hires who "don't show up to work."
"They can't stand getting up in the morning and coming to work every single day. They haven't done it, and they didn't see their parents do it. Of course, some of them get into drugs and things. So, it's difficult."
"If we hire 10, we keep two. The other eight weed themselves out," he said. "This plant is costing us millions right now."
In an interview Thursday, Singh said those comments were taken out of context. "I have said publicly, during our groundbreaking, that the city has suffered from hereditary poverty. Society has not been fair to Camden. We need to work together to help people learn skills and become productive," Singh said.
Camden Mayor Frank Moran said, "I will hold all companies in Camden accountable and expect them to be community conscious and responsible partners. I am committed to making sure that prosperity reaches all neighborhoods and people of Camden."
Holtec's Camden facility has been controversial because of the amount of the tax incentive it received — $26 million a year for the next 10 years — and the fact that Holtec moved about a dozen miles from Evesham. More than 20 firms received more than $1 billion in tax breaks to expand in or move to Camden, including European Metal Recycling ($253 million), American Water Works ($164 million), Subaru ($118 million), Lockheed Martin ($107 million), Connor Strong & Buckelew insurance firm ($86 million), and the Philadelphia 76ers ($82 million).
Firms such as Holtec that get tax breaks aren't required to hire Camden residents.
Michael Amato, CEO of Camden Yards Steel, told the Inquirer of hiring problems this spring. Amato estimated that out of 100 temporary employees who might cycle through his training program, four or five end up staying on as permanent hires despite generous pay, 100 percent health-care coverage, and retirement benefits.
Camden Yards is a family-owned company that makes hot and cold rolled carbon steel, coated steel products, and custom pre-painted coil and sheets.
"The idea of a day's work is different [from] when I was their age," Amato said. "They don't view their job as a necessity. That's probably the biggest difference. It's easy to go find other work or collect unemployment. It's very difficult to incent to respect their job. We pay very well here, and pay 100 percent health insurance. We have 401(k)s."
Peter Cappelli, professor of management at Wharton, said he has "real sympathy for employers who are trying to help the community by hiring people in Camden. I'm sure Mr. Singh is right that they don't have skills or work experience and that he can't use them. But this isn't exactly evidence of a national problem. Camden is one of the most depressed and disadvantaged communities in the U.S. It would be difficult to think of a place with a less-qualified labor pool."
That said, "it would be harder to find a lot of people willing to do heavy industrial work now. One reason is that we gutted vocational education and pushed everyone to college, basically telling them that there was no future in hands-on work," Cappelli said, which he detailed in a book, Will College Pay Off?
Wages may be the key. Union jobs pay roughly half of what those same jobs paid a generation ago, after inflation.
"If Ford opened a plant here to hire 4,000 workers, and they were paying $50 an hour — the equivalent of what they paid a generation ago — would they get workers?" Cappelli said. "I think they would, a lot of them women. If the choice is $20 an hour for hard-labor factory work, and I can get $15 an hour working at McDonald's, maybe not."