We have millions of open jobs, so where are the people to fill them?
President Trump campaigned on one main economic priority: job growth. He has since launched multiple initiatives to spur job creation in the United States. But even the most promising of these initiatives — the White House’s recent executive order to expand federal job training — may produce lackluster results, as it is based on an outdated model of training workers for the jobs of the past.
The United States is currently experiencing a skills gap. Right now, there are 6 million job openings and 7 million unemployed workers. Today’s unemployed workers are simply not equipped with the skills to successfully match with unfilled jobs. Effective worker training has the potential to close this gap. It can also help to fill the shortage of U.S. workers in computer science and other science, technology, engineering and math fields, and help workers who have been displaced by international competition to secure new employment.President Trump’s executive order specifically expanded registered apprenticeships. These are federally-funded programs in which businesses partner with the government to provide paid work experience to job seekers. In return, participants receive industry training and an opportunity to build relevant skills that employers value. But simply expanding current federal training programs is not enough. The programs must be reformed to train workers for the jobs of tomorrow.
A new report from the American Action Forum finds that federal worker training programs do not effectively provide workers with the skills to meet employer demand. For instance, more than 70 percent of registered apprentices are in construction, and almost 80 percent are in goods-producing industries. But growth in goods-producing employment is only projected to comprise 8 percent of total job creation over the next 10 years. On the other hand, almost 95 percent of creation will be in service-providing jobs, an industry in which only 21 percent of apprentices are trained.
A similar mismatch exists in federal programs for adults and dislocated workers. In both instances, participants are being disproportionately trained for occupations like maintenance, machinery and transportation, while not enough are trained in managerial, professional or service occupations. Federal resources should be shifted from industries experiencing declining demand and toward growing sectors of the economy.
Another potential issue with federal training programs involves their funding priorities. Most current programs mainly cater to disadvantaged individuals: those who are low-income, homeless, have a disability or face another significant barrier to employment. Outside of registered apprenticeships, which require an employer sponsor, there are no other federally-funded training programs open to all individuals seeking to improve their employability.
President Trump has proposed multiple other job-growth initiatives, but they lack the policy substance that would generate results. One example is his “Made in America” week. While the aim of this initiative was to promote American production, research has found that “Made in America” requirements hurt, rather than help, Americans by raising consumer prices. Another example is the president’s “Buy American and Hire American” executive order, which strengthened a long-standing federal preference for American-made goods. By restricting options, this mandate raises the cost of federal procurement.
The president also believes that being “tough on trade” and restricting immigration will protect American workers from job losses. This is not the case. International trade has been proven essential to economic growth, productivity growth, and job creation. For instance, trade with Canada and Mexico supports nearly 14 million jobs for U.S. workers, with the North American Free Trade Agreement (NAFTA) responsible for a direct increase of 5 million jobs. Imposing tariffs, on the other hand, hurts American consumers and the economy. Similarly, without immigration, the U.S. economy, population and labor force would shrink. Despite these economic realities, President Trump repeatedly threatens to withdraw from NAFTA and supports a bill which would reduce legal immigration by 50 percent.
Jobs are the most effective anti-poverty program. There are 6.3 percent of working Americans living in poverty, compared to 31.8 percent of non-working Americans. Properly structured, effective worker training can help these workers find jobs while simultaneously filling labor shortages and boosting economic growth. However, U.S. employment will not increase as a result of restricting trade or immigration, nor will it meaningfully rise by simply expanding the current model of federal job training. Federal training programs must be reformed to equip workers with the skills necessary to contribute to the nation’s current and future labor market.
Jacqueline Varas is director of immigration and trade policy for the American Action Forum.
The views expressed by contributors are their own and are not the views of The Hill.