Myths and Action: What Economic Developers Must Know About Workforce Development and Community Colleges (cont.)

Labor force growth is not expected to keep pace with job growth through 2020. Click for a larger image.

Myth: Given trends in outsourcing and increased productivity, the current supply of skilled workers is adequate to meet employers’ demands.
Fact: Jobs requiring a college education are outpacing the supply of workers with undergraduate degrees, setting the stage for a significant labor shortage.

Changes in technology and in how firms operate have resulted in increased demand for skilled workers. For the past 20 years, the dramatic growth of the native-born workforce has supplied employers with an ever-expanding source of new workers. That period of growth is over. The native-born workforce grew by 44 percent over the last 20 years; it will not grow at all over the next 20 years. At the same time, jobs requiring at least a college degree will continue to grow at a brisk clip – increasing by more than 40 percent – while the growth of low-skilled jobs will slow.2

According to economist Anthony Carnevale, the mismatch between worker skills and employer demands will produce shortages of workers with college-level skills projected to reach 12 to 14 million in 2020.3

Implication: Left unaddressed, the current stagnation of educational levels will mean that firms cannot meet their growing need for skilled workers.

Myth: The benefits of higher education are enjoyed primarily by individuals, with marginal benefit to society at large.
Fact: Increased educational attainment pays economic dividends for both the individual and the society as a whole.

While the individual accrues significant economic benefits from higher education, the relationship between increased levels of education and indicators that benefit society as a whole is well established. Higher levels of education correspond with lower levels of unemployment and poverty. The young children of parents who attended college display higher levels of school readiness than do children of parents who did not attend. Once they graduate from high school, children whose parents have some college education are significantly more likely to attend college themselves than are those with similar incomes whose parents did not go to college.

Implication: Left unaddressed, the current stagnation of educational levels may have significant consequences on per capita income and economic growth.

Myth: Fixing the K-12 system is the answer; anything else is just patchwork.
Fact: Upgrading the skills of youth and adults currently in the workforce is required to ensure an adequate pool of skilled labor.While improving K-12 education is a critical need, it is not enough to ensure U.S. competitiveness.

The demographics illustrate the issue: 83 percent of the 2010 workforce was in the workforce in the year 2000. Any solution to workforce readiness that ignores the need to continually upgrade the skills of workers over 18 years of age is incomplete.

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