The CEO of an Indiana medical packaging and transport company needed to fill some jobs. Quickly. However, he “wanted to avoid” spending the $45,000 to $60,000 it would take to hire a staffing company to fill those posts for him. So instead he turned to Indianapolis’ WorkOne offices, a “one-stop career center system” funded by a grant awarded by the U.S. Department of Labor’s Employment and Training Administration. The agency is doing something a little unusual as a public entity. It is providing staffing services to companies much in the way private firms do, except it’s doing it for free.
Yes, you read that sentence right. Read it again if you don’t believe me. Or read the original article in the Indianapolis Star where those words came from.
Your tax dollars hard at work. Working against you perhaps in this case, in the form of a government agency giving away for free what you are bold enough to charge money for.
“We wanted to take a private-industry approach to a public division,” said Bryon Silk, business solutions manager for EmployIndy, who manages WorkOne Indianapolis, to the newspaper.
EmployIndy and WorkOne receive funding through the Workforce Investment Act of 1998 and other specialty federal grants, to recruit candidates, educate unemployed or underemployed workers and connect them with appropriate employers.
The federal legislation “provides the framework for a national workforce preparation and employment system designed to meet both the needs of the nation’s businesses and the needs of job seekers and those who want to further their careers,” according to the government website. Title I of the legislation is based on the following elements:
- Training and employment programs must be designed and managed at the local level where the needs of businesses and individuals are best understood.
- Customers must be able to conveniently access the employment, education, training, and information services they need at a single location in their neighborhoods.
- Customers should have choices in deciding the training program that best fits their needs and the organizations that will provide that service. They should have control over their own career development.
- Customers have a right to information about how well training providers succeed in preparing people for jobs. Training providers will provide information on their success rates.
- Businesses will provide information, leadership, and play an active role in ensuring that the system prepares people for current and future jobs.
I did have the chance to have an extended phone conversation with Tiffany Thompson, president and owner of DaMar Staffing Solutions in Indianapolis, for her take on EmployIndy.
She says as a body shop EmployIndy has a place in the market, and doesn’t seem to resent at all what they are doing.
“At the end of the day it’s free, and I believe you get what you pay for,” said Thompson, who started in the business as a recruiter more than 20 years ago. “If decision makers have the time and energy to sift through endless amounts of candidates, then I guess it could be a good deal. But if you want relationships, and service, and effectiveness and efficiencies when it comes to capturing the best candidates, I don’t think EmployIndy can compete with me. These are government workers who don’t know our industry, who aren’t keeping up on what’s hot and simply won’t ever take the place of a traditional staffing agency.”
“These are government workers who don’t know our industry, who aren’t keeping up on what’s hot and simply won’t ever take the place of a traditional staffing agency.”
That last statement may be news to EmployIndy though. The Indianapolis Star article cited another example where they undertook a 300-person hiring project for a Central Indiana health-care service provider who needed to bring on nurses and other graduates with a background in business, public health, teaching and computer science.
EmployIndy screened approximately 600 candidates, found the best 300, then referred them to the client. Bryon Silk of EmployIndy said they saved the health care organization $1 million through its staffing services.
“We’ll work in competition with staffing services,” Silk told the newspaper. “Our goal is to be (a company’s) sole source for candidates.”
“We’ll work in competition with staffing services. Our goal is to be (a company’s) sole source for candidates.”
So Tiffany Thompson may not think EmployIndy is competition, but given that quote, the folks at EmployIndy think otherwise!
What do you think? Is this okay? The more the merrier? Any program that gets more people back to work is a good thing regardless? Or is this a taxpayer-supported direct hit that is literally taking money from traditional staffing agencies? Does anyone know other areas of the country where this same thing is happening? We would love to hear from you.
{ 5 comments… read them below or add one }
I’ve never been a huge fan of spending government money on things that companies will do privately. Take the BMV for example. Almost every time I go to a Government-run BMV, I wait in line for 20 minutes to an hour. I walk into a privately owned BMV and I’m out the door in 5-10 minutes every time. Just one example.
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well the unemployment office should do something to help get people back to work. i haven’t seen anyone in the private industry create a user tool that would directly help funnel those people in need of employment to the staffing agencies if it did exist I think the government would be more than happy to let private business handle things but as it is they can’t just sit back and hope people go out and look for work. Good for Indianapolis on taking a proactive stance – now staffing agencies get your tail in gear and help your area unemployment office help get people back to work or you just might see the government helping you out of a job
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As the Vice President/Partner of a locally owned staffing company in TN, my experience has been that many, if not most, of the staffing services in our local markets make every effort to partner with our state unemployment offices to assist job seekers in re-entering the workforce. The idea of any government backed organization, which is funded through revenue generated by payroll, income, and business tax payments made by private sector businesses (including staffing companies), competing against the private sector, should infuriate all business owners in a free market society.
Its pretty frightening to me to see someone making a statement like, “you just might see the government helping you out of a job.” That private sector job is what makes the salary of the government employee possible. I guess everyone is a Karl Marx fan these days.
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David,
I fear your article is somewhat biased in that it portrays the one stop career system as some new and mysterious government entity that competes against staffing agencies in putting people to work.
One stop career centers are NOT government agencies, but are publicly funded and generally operated by the private sector (either by for profit companies or non-profit agencies).
Just because an organization receives public money doesn’t mean they are government agencies. That’s like saying Lockheed Martin is a government agency because it receives public funding to design and manufacture airplanes for our armed forces.
The one stop system career system has been been around since the 1990s ever since WIA became law. It is a system that must work with the private sector. Running a one stop career center without the active participation of local, private employers is like trying to drive a car on an empty tank of gas. work. Many of the employers that use one stop career centers happen to be small businesses that can’t afford to use a staffing agency. I need to point out that staffing agencies often employ people that were referred by a local one stop. Staffing agencies will even host hiring events at one stop career centers.
It is also a fact that many one stops are staffed by non-government people many of whom that have an HR and recruiting background. In fact, I and two of my fellow recruiters have experience working at one stop career centers.
The bottom line is that the one stop career system – at least in the Houston area – is staffed by capable people that work 50 plus hour workweeks. And like regular recruiters, one-stop employees have to produce. One stop employees that don’t get hires arent’t around very long.
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Taken straight from the EmployIndy website: EmployIndy is Marion County’s local workforce development organization dedicated to advancing workforce solutions for Indianapolis. EmployIndy manages the three WorkOne centers in Marion County and invests public and private funds for job training and education services to prepare a pipeline of skilled workers to fill the high demand jobs of today and in the future.
Joe, maybe I did go too far in calling it a “government agency” in the headline. However, I think it is accurate to call it a public entity. That’s how the Indianapolis Star referred to it, and it’s a definition I agree with.
The Workforce Investment Act (WIA) provides $3 billion annually for employment and training services to EmployIndy and approximately 600 similar areas around the country.
Those dollars come from individual taxpayers, and as Justin points out, from payroll, income, and business tax payments made by private sector businesses.
Joe, I like the model that you describe in Houston where the one-stop career centers work with – and not against – local staffing agencies. I also appreciate that their clients may indeed may be companies that simply can’t afford the services of a staffing agency.
However, your description and the case you make differs from this Indianapolis story in those very big respects.
The spokesperson for this one-stop career center in Indy makes it very plain they are in fact competing against local for profit staffing agencies. I don’t know how his quote could be any more direct.
The second differentiator is that both companies cited in the newspaper article can very well afford a staffing agency! The medical packaging and transport company whose CEO is referred to is Intelsius; a subsidiary of DGP Life Science Ltd, which is headquartered in the UK. Intelsius serves a wide range of organizations, including government agencies, leading pharmaceutical, biopharmaceutical and clinical research industries to major laboratories, and has manufacturing facilities, distribution hubs and local offices situated throughout the world, including North America, Europe and Asia. In other words they are a big global company that received tax subsidized staffing services for free instead of paying the $45 – 60K to someone like the Indianapolis staffing agency owner I spoke to. The Indiana health care provider mentioned in the article is the Community Health Network. They just broke ground on a $23 million rehab facility and they have 100 health care sites and affiliates throughout Central Indiana. So yes, they too could have afforded a staffing agency.
I appreciate the well formed comment Joe. But I still stand by my original post that even a partially publicly funded entity such as EmployIndy should not be competing head to head against for profit staffing agencies, and taking money out of their pockets in the process.
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