The Human Capital Resource Challenge: Recognizing and Overcoming Small Utility Workforce Obstacles

Does the availability of an educated workforce in a utility's labor market affect that utility's ability to carry out its mission? This study analyzes US Safe Drinking Water Act (SDWA) compliance to show how levels of human capital (i.e., collective education) in utilities’ labor markets affect their performance. Results indicate that utility scale correlates positively with SDWA monitoring and reporting requirements. Both scale and human capital in a utility's labor market significantly predict compliance with SDWA water quality standards; where a utility has the size and resources to take advantage of human capital resources in its labor pool, SDWA health compliance improves. After identifying these patterns, a comparative case study analysis of two small utilities is used to identify workforce strategies by which utilities might overcome limited access to human capital. Extensive cross‐training of personnel emerges as a potentially useful management strategy for smaller utilities in regions where educated workers are scarce.