How Unskilled Americans Are Creating a Work ‘Crisis’ for the U.S.
The Labor Department’s job numbers may not reflect the true number, or desperation, of the nation’s unemployed workers.
Employers were looking to fill more than 6 million vacancies at the end of April. At the same time, government data suggest nearly 6.9 million Americans are out of work and actively looking to land a job.
The math isn’t lost on economists and business leaders, who see the record number of job openings and the millions of unemployed Americans still sitting on the sidelines and find it increasingly difficult to ignore the skills gap plaguing the private sector.
“Imagine if we could match those 6.9 million [unemployed Americans] to 6 [million job openings]. The unemployment market would virtually disappear,” Labor Secretary Alexander Acosta said at an event Wednesday morning hosted by Business Roundtable.
Acosta joined a cadre of politicians and business leaders – including JPMorgan’s Jamie Dimon and IBM’s Ginni Rometty – as they aimed to examine precisely why so many job openings remain unfilled while so many Americans looking for work are sitting on the sidelines.
“There is an obvious mismatch between worker skills demand and supply,” Acosta said. “Education is not focusing on the skills demanded by today’s workforce as well as they could or should.”The skills gap is a concept that’s been researched and written about frequently in recent years as companies struggle to find qualified candidates to fill openings and unemployed Americans without access to training and education programs fight to get back into the labor market.
Wednesday’s event added to that discussion, as it coincided with Business Roundtable’s launch of a skills gap report profiling three main shortcomings noticed by employers.
Fundamental employment skills – solving basic math problems, communicating effectively, working as part of a team – are the first problem area.
Second is a lack of candidates with specialized skills – mostly to work in trade professions like welding and mechanical repair, which don’t necessarily require a college degree.
And finally, STEM skills – refined science, technology, engineering and math abilities that usually require some form of higher education – are at a premium, especially among women and minorities.
“It really is the crisis. And the failure, the damage this has done to this country – we talk about 2 percent growth and all that – this is part of the reason why,” Dimon said.
But actually going about fixing the problem is easier said than done. Sen. Michael Bennet, D-Colo., for example, touched on the idea that middle schools and high schools have done a poor job encouraging children to pursue skills-dependent careers during a critical phase of their upbringing.
“We have done an unbelievable job in this country of making math and science as boring as possible in middle school and high school. And one of the things that businesses can do … is make people understand how compelling it is – what a career looks like in aeronautics or something else that requires math and science,” he said.
Acosta, meanwhile, praised the structure of medical schools in the U.S. – which include several years of classroom work and, in Acosta’s words, “experiential learning” through residencies and hands-on training. He suggested this could be applied to more higher-education institutions to better supply students going into criminal justice or journalism fields with the skills they’ll need once they graduate.
“Experiential learning is applied to certain areas and not others largely because of historical monopolies, and this is an opportunity to start addressing that,” he said. “The concept of experiential learning is an answer to this mismatch between workforce demand and workforce supply.”
But both members of the administration who attended the event – Acosta and Trump assistant Reed Cordish – hit back at the idea that the federal government should bear the full costs of training the U.S. workforce. Trump’s budget proposals have been criticized for slashing skills development funding, but Cordish indicated the administration doesn’t think the problem is “money.”
“The problem is accountability and effectiveness,” he said, running through the federal costs of maintaining workforce training programs the White House feels are duplicative.
The best results, he said, occur when “businesses team with community colleges and vocational schools.”
Acosta struck a similar tone, saying he feels the government has a role primarily in setting up what he called “private-private-public partnerships.”
“The government can help arrange the meeting. The government can in essence sort of set up the blind date. But ultimately the relationships need to be in the private sector,” he said.
But Sen. Tim Scott, R-S.C., noted the economy won’t run efficiently with so many Americans still out of work and so many employers looking for candidates. Hitting the administration’s ambitious 3 percent growth target, he said, will be a difficult task without meaningfully addressing the skills gap.
“The truth of the matter is … if we lower the corporate tax rate by 10 [percentage] points, if we have permanent repatriation and bring home $2.5 trillion, we see synergy in our economy. If we don’t take care of the workforce readiness piece, creating 6 million more jobs to go on top of the 6 million [vacancies] we have today will not grow our economy 3 percent,” he said. “And my side of the aisle should do a better job of understanding that not just do we need to have tax reform, we’d better have a workforce component in our psyche if we want to make ourselves competitive.”
Bennet, Scott’s Capitol Hill colleague on the other side of the aisle, drew a few chuckles when he overwhelmingly supported Scott’s take on the government’s need to address the skills gap.
“It’s not just your side of the aisle. It’s my side of the aisle, as well,” he said.
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