The Skills Gap and ‘Good Jobs’ Deficit

    A new report from the nonprofit Brookings Institution adds weight to the argument that high-tech cities fare better overall.

    It doesn’t say that in so many words, but it finds that overall unemployment is lower in cities with more highly educated workers. And cities with big gaps between the education needed for jobs there and the educational levels that residents have attained have fewer job openings and lower levels of job creation, according to Bloomberg.

    Among the cities with the narrowest education gaps were San Jose, Calif., Washington, D.C., and Raleigh-Cary, N.C. Should we be surprised that those cities also are tech hubs?

    The Brookings researchers compared online job postings between January 2006 and February 2012 in 100 metropolitan areas and compared that with the educational levels of residents. (You can make a deep dive into your own city’s numbers.) Overall it found that 43 percent of jobs require a bachelor’s degree, while only 32 percent of adults ages 25 and older have one.

    The report isn’t specific to tech, but found that occupations in high demand require more education. Lower-level jobs are less likely to be advertised online, though — an obvious flaw, the researchers admit. Computer jobs were most likely to be advertised online, and 63 percent of workers have at least a bachelor’s degree, followed by health practitioners, with 71 percent with that level of education.

    Other findings:

    • Online job postings overall require more education than existing jobs, and require more education than the average worker in that market has. Employers tend to be raising their educational requirements and refilling even existing positions with higher-skilled workers.
    • Large metro areas such as Boston, Washington, D.C., Seattle and Indianapolis that had above-average boosts in the attainment of bachelor’s degrees also created more jobs per capita from 1980 to 2010.
    • Metro areas with a more educated work force score better on job creation.
    • The difficulty in filling higher-skill positions is little changed from the 1960s, though it might seem that way, the authors say. Computer and health care jobs tend to take more than a month to fill.

    Essentially, it says that cities with better-educated work forces create more jobs at all levels.

    “Educational attainment makes workers more employable, creates demand for complementary less-educated workers and facilitates entrepreneurship,” the report says, which also found that those who start new businesses are more likely to have a bachelor’s degree.

    It disputes, however, the idea that skills mismatch has fueled unemployment in the recession, attributing the short-term problem to declining home prices and industry demand, Forbes reports.

    “… The evidence suggests that the need for higher education is mostly a long-term problem that is not the primary factor responsible for increasing unemployment rates since the recession began; the fall in demand for goods and services has played a stronger role in recent changes in unemployment. The problem is a lack of job openings, rather than difficulty filling available jobs. Given that more than half of new jobs typically come from establishments started within five years, the lack of openings implies a need for more entrepreneurship, as well as higher demand.”

    It backs policy to stimulate demand and promote entrepreneurship, as well as efforts at local levels to boost workers’ skills to meet employers’ job requirements.

    Separately, a new report from the National Employment Law Project backs the idea of a further hollowing out of the work force. It says lower-wage positions — those paying $7.69 to $13.83 an hour, such as restaurant and retail jobs — made up 21 percent of the jobs lost during the recession, but make up 58 percent of the jobs added since. Middle-wage jobs — paying $13.84 to $21.13 an hour, such as construction, manufacturing and information clerks — made up 60 percent of recession losses, but only 22 percent of the jobs added back. Meanwhile, higher wage occupations were cut by 19 percent in the recession, but make up 20 percent of the new positions added.

    “The overarching message here is we don’t just have a jobs deficit; we have a ‘good jobs’ deficit,” Annette Bernhardt, the report’s author and a policy co-director at the National Employment Law Project, told The New York Times.

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