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US Needs to do Better Job Preparing Workforce for Technological Advances

"A failure to address the nation’s workforce challenge will increase the pressures for retrenchment that are already causing the United States to back away from global leadership,” said the Council on Foreign Relations.

The workforce is being transformed via smart machines and other technologies but the U.S. isn’t preparing workers for these changes, according to a new report from a task force of  the Council on Foreign Relations.

The group says that  “governments, businesses, educators, and other institutions need to do far more to help Americans adapt and thrive in the face of these disruptive forces.”

These forces will affect as many as one-third of American workers by 2020, according to a report by McKinsey Global Institute.

The task force, co-chaired by former Michigan Governor John Engler and former U.S. Secretary of Commerce Penny Pritzker, notes “that rapid technological change, heightened global competition, and growing barriers to opportunity have weakened the link between work and rewards. While new opportunities will likely be created to replace those lost, American workers face substantial obstacles in acquiring the education and skills needed to prosper in a more automated work environment.”

The group offers some recommendations:

--Help Americans take advantage of the opportunities posed by technology. “Technology has been the biggest cause of job disruption in recent decades, and the pace of change is likely to accelerate. . . . Occupations that are especially vulnerable include manufacturing, food service, and retail trade,” but many other sectors will also be affected. “Many of the new jobs being created will require significantly higher levels of education and skills.”

--Strengthen the link between education and employment. “The challenge is not just providing more education but providing better-targeted education that leads to better work opportunities. . . . The goal should be to link educational offerings more closely with employment outcomes, in particular by expanding apprenticeships, work-study programs, and internships to strengthen the link between education and work. New initiatives are also needed to improve affordability and access to postsecondary education, and to encourage lifelong learning.”

-- Spur job creation, especially for better-paying jobs. “Most of the advanced economies have seen rising inequality in wage earnings and a falling labor share of income. But the polarization has been more extreme in the United States than in other similar economies. The best antidote to these polarizing trends is a strongly growing economy that is at or near full employment.” Employers should commit themselves to creating a “high-road workplace” that offers employees decent pay, training, scheduling, and benefits.

-- Make the skill demands of jobs more transparent. Employers should work with governments and educational institutions to improve credential quality. “Improvements in credential quality and transparency will also feed back into the educational choices of young people, helping companies to develop the talent pipelines they need.” Many “employees who could do the jobs that are open are not in the right places, have earned credentials that are not recognized, or are not being hired even though they have the right capabilities for the job.”

-- Provide better help for displaced workers. The United States spends just 0.1%t of gross domestic product, roughly one-fifth of what the average European country spends, on training and assistance for those who have lost jobs. The United States needs to emulate the best models for helping displaced workers.

-- Improve the benefits and returns from work for all Americans. “Workers in alternative arrangements—including independent contractors, freelancers, temporary employees, and gig economy workers—now make up some 16% of the total U.S. workforce, a figure that has grown by half over the last decade . . . . The United States should create portable systems of employment benefits tied to individual employees rather than to the jobs themselves.”

-- Understand that the problems will not be solved by Washington alone. “To underscore the urgency of the task of building the workforce of the future, the president and the nation’s governors should create a National Commission on the U.S. Workforce to carry out research, share best practices, and conduct public outreach on workforce challenges. This should be the start of an ongoing effort to put workforce issues at the center of the national conversation.”

“Even with the reasonably strong job growth of recent years, the divide between those succeeding and those struggling is growing, regional disparities are increasing, economic inequality is rising, and public anger is deepening political divisions,” warns the task force. “The country’s future as a stable, strong nation willing and able to devote the necessary resources and attention to meeting international challenges depends on rebuilding the links among work, opportunity, and economic security. A failure to address the nation’s workforce challenge “will increase the pressures for retrenchment that are already causing the United States to back away from global leadership.”

For more information on the report and other resources visit The Work Ahead.

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