We are posting this not so much to highlight the two stocks but rather the changes in the wider employment landscape.
From Bloomberg, August 5:
A skilled worker shortage and the federal government’s push to increase manufacturing in the U.S. are turning two for-profit vocational school operators — Lincoln Educational Services and Universal Technical Institute — into two of the hottest small cap stocks on Wall Street.
Both companies are among the 100 best-performing firms in the Russell 2000 Index over the last two years, with Universal Technical Institute’s shares leaping around 335% and Lincoln Educational Services climbing 220%, compared with the index’s 12% advance in that time. Investors and industry insiders expect the run to continue as the economy increasingly needs the skilled trade workers these companies produce.
“I just point to the 150,000 job openings for electricians, welders, and HVAC,” said John Barr, portfolio manager of the Needham Aggressive Growth Fund, which holds both stocks.
Attitudes on vocational schools started changing during the pandemic, when many skilled trades were deemed essential services. This need for skilled trade workers is now becoming palpable, with the number of trade worker retirements rising sharply and the spending bill Congress recently passed encouraging capital investments and factory construction.
“There’s a cultural shift going on,” said Alexander Paris, president of Barrington Research Associates. “For 50 years, the trades have been out of favor for a number of reasons, including educational barriers, the reduction of trade school programs in high school, and every parent saying, ‘No son of mine’s gonna be an auto mechanic.’”....
....MUCH MORE
