Getting 9.1 million Americans to work

The nation is facing a grave problem that threatens the economic future of every worker, every company, and the country at large. Over 9.1 million Americans are unemployed and millions of others are underemployed. Yet, 4.8 million jobs remain unfilled because there are not enough people with the practical, real-world skills that companies need. The current skills gap is not only hampering domestic growth; it’s threatening economic competitiveness on a global scale. The more insidious aspect of this employment trend is that many in the workforce are giving up the very attribute that makes the U.S. great – hope.

We know that we need skilled people to close this gap. We know that behind every successful economy you find an engaged and productive workforce. We also know that the cost of living is rising and even the minimum wage, for most people, is not enough to get by. And we know that by the end of this decade that one in three jobs will require some higher education. Our education system doesn’t give enough weight to practical and technical skills, to the hands-on learning that informs the real-world skills that companies actually need. At the core of this challenge, of course, is educational access and affordability. With U.S. student loan debt reaching $1.2 trillion dollars, and the average 4-year college graduate leaving school saddled with $30,000 in debt, things simply must change. Left unchecked, student loan debt may very well produce the next systemic financial crisis.

{mosads}All complex challenges have multi-stage solutions. In this case, much of the work that needs to be done to get the nation back to work is qualitative. For example, destigmatizing the trades and vocational skills is a great place to start. Along these lines, President Obama’s program to make community college free, while maintaining a B grade point average, does a lot to improve general educational access. However, it’s the demand-side of the employment market, namely the firms doing the hiring, that undervalues the trades. There are so many jobs and career pathways in the U.S. economy that are filled by algorithm. That is to say “no B.A. or M.B.A., no job.”  Yet, in reality, willing and able people, regardless of their educational attainment, can fill all but the most complex jobs in our economy. In fact, the rise of corporate universities and Starbuck’s groundbreaking college access program suggests that firms want their raw human capital inputs to be measured by personal determinants, such as cultural fit, adaptability and other ‘untrained’ traits. The rest of their ‘formal’ education can be attained on the job or, in Starbuck’s case, through the job.

The global job market is changing profoundly and many hitherto ‘safe’ career classes, including in the services space, run the risk of being automated, dislocated or disrupted altogether. While the U.S. remains a global hotbed of entrepreneurship, the lack of professional apprenticeships is troubling. In Europe, an apprenticeship is not only a coveted position, it is a vital pathway for skills transfer, career advancement and a long term footing in the middle class. Unlike its U.S. cousin the internship, an apprentice is rarely found doing menial, low value-added work. Rather, apprentices are most often found gaining practical skills, often at senior echelons over an extended period of time. This work, based in the end on cultural fit, often translates into career options with the hiring firm. In some companies, such as the Danish firm Kjaer Group, successful apprentices were not only rewarded with a job, they scaled Mount Kilimanjaro with the company’s CEO.

Against this backdrop, there are 3 broad recommendations to address the nation’s unemployment and underemployment challenges. The first involves fixing educational attainment and affordability. When compared to OECD countries, America’s prohibitively high student debt burden not only inhibits risk-taking at ages where people can bounce back, it quite literally is a drag on the economy leading many young people to bankruptcy and lifelong financial problems. Many studies are now questioning the economic rationale and ROI for all but the most technical fields in tertiary education. The second broad recommendation, ironically, involves lowering barriers to workplace entry, rather than raising them. Importing European-styled apprenticeships can materially reduce the unemployment rate, give the underemployed new hope and create a vital source of talent for firms struggling to fill key positions.  Finally, “buy-side” improvements by hiring firms that break algorithmically safe hiring patterns can serve as a catalyst for change in the U.S. job market. With these recommendations in place, vitality and resilience will be restored in the U.S. workforce.

Disparte is the founder and CEO of Risk Cooperative and the chair of the Business Council for American Security. Wyman is the CEO of the Institute for Workplace Skills and Innovation and author of Job U, a best-selling book on upskilling the workforce.

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