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Why This CEO Is Donating His Salary to Workforce Education

March 28, 2016
Mike Petters of Huntington Ingalls last week announced he would annually give all but $1 of his base salary to an educational assistance fund that includes scholarships for workers' children. Here's why.

Huntington Ingalls CEO Mike Petters is in the military shipbuilding business, where a single product takes eight years to build and has a shelf life for a half century. So it’s not a great leap to say he takes the long view.

Last week, Petters announced he would donate all but $1 of his annual base salary, in the ballpark of $950,000, to workforce training, including scholarships for children of employees. It builds on a legacy of workforce development at Huntington Ingalls, which invests in STEM education, partners with community colleges and technical schools, offers summer internships for students and teachers, and has apprentice schools at its two shipyards. 

Petters, who grew up in a large family on a Florida orange and cattle farm, himself got a boost in his youth from scholarships to a Jesuit high school and later, to the U.S. Naval Academy.

He talked to IndustryWeek about why he made the salary decision, as well as the value he places on strong early childhood education (which he’s called a matter of national security) and the importance of leadership training in apprenticeship programs.

What prompted you to donate your salary to workforce education, and why now?

The people that we work with here, they’re some of the greatest folks that you’ll ever get a chance to meet. And they work hard.

They not only put their heart and soul into the work that they do on behalf of the company, but they put their heart and soul into the communities where they live. They run the little league teams on the weekends, they usher in the churches on the weekends. They are the backbone of where we live. And my personal view is that being able to help them do and accomplish the things that they want to accomplish for their families is something that is in all of our interests.

It’s a chance to give people the chance to create a little bit different future for themselves. Somebody did that for me; I’m lucky enough to have the chance to do it for others.

Your path changed when you were in eighth grade and earned a scholarship to a private high school.

My parents believed that education was the way you set your path for yourself. We didn’t have any money, but we raised our own vegetables; we raised our own beef; my grandparents ran a dairy. We made do with the work that we did.

I had the opportunity to go to a Jesuit high school in Tampa, about 30 miles away. I took a test and got accepted. Couldn’t afford it, so I basically worked my tuition off while I was in high school, traveling back and forth every day to go to class. I put a lot into that education, and I got a lot out of it.

But everybody’s got a story. There are a lot of stories a lot harder than mine.

One of the great things about America is that the American Dream is something we have generally believed in. That if you work hard and take advantage of opportunities in front of you, you can move yourself to a different trajectory than what you were born into.

I think that we have people in this country today who are starting to question whether that’s really true.

I think it’s very important that it still be true. It’s up to those of us who have actually gone down that path—and had the chance to be successful and had the opportunity and the means—to make sure that we lean back and keep the American Dream alive. We can talk about it all we want to, but actions speak louder than words.

In It for the Long Haul

You’ve been a big advocate of a stronger national investment in early childhood education programs. Will any of this money go toward education in the younger grades?

We’re still working out the details of all this, but that’s a priority. If you go and talk to educators, what they will tell you is by the third grade, the academic path of the student is pretty well set. If you’re not reading at grade level by third grade, it gets to be really challenging to recover from that.

In shipbuilding, the earlier we do the work, the cheaper it is. If we do work in our shop areas, it may cost one hour. If we do that same job in a ship that’s on the river right before delivery, because of the space and the confinement, it’s eight hours to do that same job.

And so for me, it’s been pretty easy to make the parallel: We spend a lot of money on workforce development trying to get people ready after they’ve come through the education pipeline and sometimes catching people up or correcting that situation. But wouldn’t it be great—isn’t the return a lot higher—if we actually catch them on the front end of the pipeline instead of on the back?

Do you think the manufacturing industry has done enough to encourage education and training?

Certainly in our company, we are deeply committed to the entire pipeline of workforce development. It’s really hard for us to hire somebody that has a degree in shipbuilding. So we run our own apprentice groups; we have our own craft training program; we do things to give our people a chance to do their very best. We invest in the state workforce development pipeline in Mississippi and Virginia in a very big way. The more you put into that, the more you’ll get out of it.

All of the things we want to do in our future rely on our people, so finding ways to invest in them is generally and usually our best bet. We’ve created health centers for employees because we consider that an investment on their behalf. It’s one thing for companies to say “We’re going to make our employees more accountable for their health.” What that usually means is they’re shipping costs to their employees. Our view is, you want to give employees more accountability for their health, but you want to give them the means to take good care of themselves, too. You can’t do one; you have to do both.

Before we go, can you talk about why leadership training is an important part of Huntington Ingalls’ apprenticeship program? That’s fairly unique.

A lot of apprenticeship programs are craft-oriented. Our experience, though, is that if you come through our apprentice school, you learn a craft, but in very short order we’re going to move you from your craft into a leadership position. You’re going to be a foreman. And I believe if you take your best welder and you make your best welder the foreman of welders without training that person to be a leader, it becomes really hit or miss. Because that person can actually manage it, or can’t. And so we invest in leadership development at all levels of the organization in a very big way. We have 36,000 people come through our gates, and we have 5,000 leaders who are trying to make sure that we’re all pulling that rope in the same direction. So if we get the leadership part of that right, our business will be successful.    

About the Author

Laura Putre | Senior Editor, IndustryWeek

I work with IndustryWeek's contributors and report on leadership and the automotive industry as they relate to manufacturing. Got a story idea? Reach out to me at [email protected]


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