Transcript Interviewee: Frank BrittTitle: CEO Company: Penn Foster Channel: Bloomberg US Date: 09 June 2014 Duration: 3 minutes 21 seconds Interviewer: Trish Regan Trish Regan Well, you know, there's certainly a skills gap between education and the private sector. You have more than 12 million Americans that are unemployed; you have 4 million jobs going unfilled right now, so how can that be? My next guest is working to bridge that gap. Frank Britt is the CEO of Penn Foster, the largest accredited educational institution, graduating 25,000 students each year from high school, college and career schools. Frank, thank you so much for joining me, and so we just got the jobs report out on Friday. You know, unemployment still above 6%, the U-6 rate still way up there, and yet, you know, you talk to a company like Google and they say they've got tons of jobs that they just can't fill. Frank Britt Right. Trish Regan How do we get people at a point where these jobs that are growing in the tech and engineering space and some sophisticated sectors really can be filled? Frank Britt Well, I think that the jobs report is encouraging news. It's systemic improvement, but what we see within it is that there are some real systemic problems, particularly at the "lower end of the market", so we're talking about the 20-to-30-year-old youth/adult market. That actual unemployment rate is growing. Trish Regan I know; the millennium. Why is that? Why is it growing? Frank Britt Well, I think there's sort of two cohorts. There's those who didn't get out of high school. There are 3 million people that drop out of high school every year; 8,000 people a day. Those folks are stuck because 90% of all jobs require some sort of high school degree, so those people can't go into the job market. Employers don't view them as sufficiently credentialed. At the high end of the market, they have another problem, which is just fundamental imbalance of supply and demand. There's so much need at the high end for the engineers that the economy hasn't produced enough people to meet that need. Trish Regan Well, you know, if you also think about the millennials, interestingly, and we haven't seen this in previous economic cycles; they're up against retirees. Frank Britt That's right. Trish Regan I'm told a lot of retirees going back still collecting social security but having a job on the side and, you know, maybe those are entry level-type jobs that otherwise millennials would have gotten. Frank BrittRight. Yeah, I think that's true. I think that there's a lot of focus at the high end of the youth market, the 20-to-30-year-olds, where we see a real under-appreciation, lack of attention, and a real opportunity is to help that nontraditional student who may not have gone to the traditional 4-year school. The idea that all students should go to a 4-year school right out of high school is just sort of the way we think about the future. We think that's a bit to be a dated notion. There are lots of quality jobs available that can be filled by people who have certifications, community college degrees and the like, on top of the... Trish Regan And this is what you guys are providing. Okay, so... Frank Britt Yes, we have 4 million people that don't have jobs and they can't...they can't fill the job crisis. That's not just the end of the year. Trish Regan What kind of jobs are those, though? Frank Britt You know, say, for example, in the veterinary marketplace, so vet assistants, vet technicians; that's kind of the physician assistant for animals. One of the fastest growing jobs in the economy, top 20. They're just aren't enough people who can fit that job medical capability... Trish Regan And you guys offer online training to become that? Frank Britt We're the largest veterinary program in the United States. We have 9,000 students fully-accredited, and those students are going on to get jobs in animal hospitals... Trish Regan Do my taxpayer dollars go to any of this? Frank Britt Great question. I'm glad you asked. So we believe that we have a far lower cost of capital in the consumer, and so we reject the idea that students should have to go into debt to go to school, so our model is a pay-as-you-go model. You enroll; you give a nominal down payment and as you progress academically... Trish Regan But there's no student loan... Frank Britt There's no student loans. Trish Regan Okay. No, that's a good thing. All right, thank you very much, Frank Britt, CEO of Penn Foster. Frank Britt Thank you. Trish Regan Appreciate you coming in today.