(from Forbes):

By Thomas K. Lindsay

American workers continue to suffer from a sluggish economy. Yet, despite persistent unemployment, employers still struggle to fill certain types of vacancies, “especially for so-called middle-skills jobs—in computer technology, nursing, high-skill manufacturing, and other fields—that require postsecondary technical education and training.” This is the conclusion of a study by the Harvard Business Review, which asks, “Who can fix the ‘middle-skills’ gap?”

A Texas college answers, “We can.”

As many as 2.5 million new, middle-skill jobs are projected to be added to the workforce, “accounting for nearly 40% of all job growth,” according to a recent analysis.” To ensure that these new positions will be filled, Texas State Technical College (TSTC) has embarked on a novel program, one whose initial success is likely to spawn imitators in the other 49 states. The school recently took the unprecedented step of offering to be judged—and paid—on the basis of results. TSTC, a system of public two-year postsecondary institutions offering technical (vocational) training, has crafted a model on the basis of which all of its state funding will depend on the employment and earnings of its graduates. Simply put, under the plan, TSTC will not receive state funding for a student until and unless that student is placed in a job.

“We are zealously entrepreneurial,” says Chancellor Michael L. Reeser. “Most of our administrators have business sector experience so they’re comfortable with the notion that successful operations must constantly change to stay relevant in competitive and moving environments. That often means calculated risks aimed toward innovative change.” Chief among these risks/innovations has been TSTC’s willingness to transition its state funding from a cost-recovery method to a results-only method. Traditionally, state funding is based upon the number of instructional or contact hours taught. But the new results-based methodology pays the school solely for job placement and the actual earnings history of its graduates. CONTINUE READING HERE