In 1989 R.R. Donnelley & Sons Co., America's largest commercial printer, began a dramatic shift away from business as usual. All 42 North American plants now have a team-based work structure in place. Each of these plants has the flexibility to craft their own team structures depending on their own needs and interests. According to Donnelly's President Jonathan Ward, the company "wanted to earn the hearts and minds of employees, not just the hands and feet." And Donnelly's efforts have succeeded. The pay-off for the company is higher productivity. And for employees, the reward is not only higher compensation but also the motivating knowledge that they have a real voice in the company's policies and practices. Earlier this year the World Economic Forum named the American worker the most competitive in the world. Yet the demographic reality is that we are running out of the employees we need. According to the Bureau of Labor Statistics, by 2006 we will have 151 million job openings but only 141 million men and women available to fill them. This problem is compounded by the fact that many in our current labor pool are ill equipped to serve in positions that demand high levels of education, training, and skill-sets. In the words of Lalit Sarin, CEO of recreational vehicle components manufacturer Shelby Industries Inc., "finding good people" is "one of the No.1 problems" faced by industry. A recent survey, of 4,500 companies, conducted for the NAM by Grant Thornton consulting firm found that 60 % of the survey's respondents report that at significant number of their workers lack basic math skills. More than half (55 %) find serious deficiencies in workers' basic writing and comprehension skills, and almost half (48 %) believe too many of their workers lack the ability to read and translate drawings, diagrams, and flow charts. These statistics are ominous and herald a call for some basic changes in the way we educate our young people and train our employees. First, in our primary and secondary education systems, we must give renewed attention to such basics as reading, math, and writing. We must also focus on problem solving and the practical ability to make good decisions in real-life situations. This involves, in part, school-to-work programs that equip young men and women to step into the workforce with a good understanding of what will be required of them. As Nobel Prize winning economist Milton Friedman notes, statewide school voucher initiatives will revolutionize American education, introducing a level of competition based on parental choice not known in public education for decades. Within the public schools themselves, magnet and charter schools, appropriately designed and monitored, can enhance the quality of education for tens of millions of American children. Corporate America also is doing its part. Estimates vary, but roughly $60 billion is being invested annually by companies committed to improving the skills and training of their workers. Hundreds of companies have their own corporate universities, and countless firms are working with local high schools and community colleges to formulate curricula that will match the needs of today's workplace. In 1992 Maytag Corp. of Newton, Iowa, saw a need in its community of 15,000 for a local community college. In consultation with the city government, the local school district, Iowa State University, and the Des Moines Area Community College (DMACC), Maytag provided an underutilized building on its corporate campus, about one and a quarter acres of ground, and $1 million to initiate what is now DMACC-Newton Polytechnic Campus. This facility offers everything from an alternative high school to an MBA program in conjunction with the University of Iowa. And the facility houses Maytag's own training center for its employees and provides off-hour classes so Maytag's employees can gain a post-high school education. Maytag's innovative, community-oriented approach to training and education is exemplary. The good news is that other firms are, in their own ways, following suit. The Grant Thornton survey noted earlier indicates that 96 % of manufacturers currently provide some education and training for hourly employees. Nearly half (47 %) spent two percent or more of payroll to train their shop floor and other hourly employees, up from the less than 0.5 % of payroll companies were investing in training in 1991. Lifelong learning is the model for the new worker. No longer can the ability to perform a handful of repetitive tasks suffice as the basis for a multi-decade career. Today's employees must hone their skills for success in the crucible of the competitive high-tech workplace. The benefits -- higher compensation, greater employment security, and the energizing sense that one is making a real contribution to the success of his or her company -- make the effort well worthwhile. Jerry J. Jasinowski is president of the National Association of Manufacturers. This is the second of a three-part series. His final column, on compensation, will appear Aug. 31.