Midlands Tech program to help cluster

Published in the April 2, 2012 edition of the
Columbia Regional Business Report

By C. Grant Jackson
Senior Vice President/Community Development
Greater Columbia Chamber of Commerce

Midlands Technical College‘s announcement last month of a $5 million training grant from the U.S. Department of Labor was a win for Columbia’s insurance technology and services cluster.

The insurance technology and services cluster is a huge economic engine for the region. A study released last week by iTs|SC, the regional cluster organization, found that insurance technology and services has a $6.7 billion total annual economic impact in South Carolina. That represents 2.5% of the Gross State Product.

Most of that industry’s workers, about 15,000, are employed at firms in the Columbia cluster at an average salary of $62,000. The cluster’s total annual sales are $4.9 billion.

The study was conducted through Business in Motion, a joint project of the Navigating from Good to Great Foundation and the City of Columbia. The results were reviewed and estimates and data were validated by Joseph Von Nessen, research economist at USC’s Darla Moore School of Business.

The study, the first attempt to quantify the regional industry, delivered findings that bode well for continued growth of the industry. Of the companies surveyed:

  • 70% plan to expand locally in the next 12-18 months
  • 100% are expecting sales to grow over the next 12 months
  • 55% said they expect to increase their workforce in the next 18 months and 45% said they would at least maintain current levels.

But amid the positive news, one big concern remains: workforce. Almost 50% of the companies indicated issues with recruiting and maintaining employees.

“Lack of access to skilled talent is creating both a short-term and a long-term challenge for continued growth,” the study concluded. The full study is available at www.its-sc.com.

Concern over workforce was one issue that brought Columbia’s insurance technology and services businesses to the table to begin forming a cluster in 2007 that would eventually call itself iTs|SC.

The businesses saw a need to widen and deepen the pool of available insurance technology talent. But grappling with an issue like workforce is not something businesses can do very effectively on their own; they need partners, like educators, who are in the workforce development business.

One of the hallmarks of cluster theory is that clusters don’t include just the businesses in a particular business space. California’s wine cluster for example isn’t just the growers and the vineyards and the wineries.

Likewise iTs|SC is not just companies like BlueCross BlueShield of S.C., Seibels Bruce Group, Colonial, TM Floyd and Duck Creek/Accenture. Clusters include ancillary groups like educational, research and trade organizations and in some cases even government agencies.

So when the cluster began talking about workforce, Midlands Tech, as well as USC, was already at the table.

When IT-oLogy was formed, originally the Consortium for Enterprise Systems Management, it took a seat at the table as well.

Each of those organizations is a key member of the cluster in helping deal with workforce issues.

When Midlands Tech had the opportunity to apply for the Growing Resources for Information Technology, or GRIT, program through the U.S. Department of Labor, Employment and Training Administration, it already knew some of the direction it would need to take.

Cluster members had continued to hammer the need for new workers, especially in areas like Java programming, and Midlands Tech had been looking for an opportunity to help provide those workers.

Members of iTs|SC provided Midlands Tech information and helped shape the successful grant application.

Midlands Tech was one of only 43 awardees for the GRIT grant and the $5 million was the maximum amount awarded to any school.

The program is designed to build a training infrastructure for high-growth, high-demand information technology occupations – programmer analysts, computer network support specialists and network and data communication analysts – for unemployed veterans, minorities, women and others.

“Our regional partners in the insurance and health care industries continue to have difficulty finding qualified candidates to fill these important positions,” said Cathy Pitts, executive director of programs, MTC corporate and continuing education division, at the time of the grant award.

Helping train a wider and deeper pool of talent for the insurance technology and services cluster will help keep and grow the existing businesses in the cluster. It will also help the region draw more insurance technology and services companies.

C. Grant Jackson can be contacted at (803) 733-2513 or at gjackson@columbiachamber.com.

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