The Recession Isn’t Going Away On Its Own. How to Fix the Jobs Crisis.

Eufemia Didonato

After the more than half a year since Covid-19 changed the lives of the entire country, the pandemic is very much with us. Some states have made modest progress, yet cases in far too many are spiking. Clearly, Covid-19 is still at crisis levels. The employment story is equally bad. […]

After the more than half a year since Covid-19 changed the lives of the entire country, the pandemic is very much with us. Some states have made modest progress, yet cases in far too many are spiking. Clearly, Covid-19 is still at crisis levels. The employment story is equally bad. This week’s jobs report is virtually unchanged from the week before, with approximately 1.7 million new unemployment claims, including 884,000 for full-time employees, in addition to 839,000 claims by part-time and freelance workers who have access to the Pandemic Unemployment Assistance program.

The August employment report, released a week ago, showed modest gains, but the total included close to a quarter of a million temporary census workers whose jobs will soon disappear. 

While the White House responded to the health crisis by creating a task force addressing the need for a national focus on testing, treatment, and a vaccine, there’s no such initiative in the face of a critical employment crisis. Such a concerted effort is sorely needed and must be bipartisan, looking beyond short-term unemployment benefits to include investments that save and create jobs.

The unemployment pain is severe, especially for low-income Americans. The unemployment rate for Black Americans, at 13%, is nearly double that of white Americans. And yet federal action is still stalled due to partisan bickering. With extremely high employment, large and small businesses shutting down permanently, and roughly 30 million Americans still on unemployment, labor economists like Jim Cahn at Wealth Enhancement Group and Robert Johnson at Creighton University agree that the “V-shaped” recovery predicted by the president and his economic advisors is unlikely.

Clearly, we can’t just wait things out, or, as was suggested when the pandemic hit, expect a miracle making severe health or economic problems disappear. Congress must pass the next stimulus package, extending unemployment benefits and adding funding for issues like education. But while necessary, that would be very far from sufficient. 

Even before Covid-19 hit, the U.S. suffered from declining federal investment in job training. Public funding for adjustment and reemployment training was only 0.11% of gross domestic product, lower than in Canada, Germany, and France. For over two decades, funding for career and technical education, adult basic education, not to mention overall Workforce Investment Act funding, has been falling significantly.

The history of funding cuts goes beyond government. From 1996 to 2008, employer job training and on-the-job training went down by roughly 40%. There is one bright spot. Without legislation or regulation, a group of private companies, including JPMorgan and IBM, created the New York Jobs CEO Council and committed to hire a total of 100,000 employees by 2030, largely from low-income and diverse populations in New York City. This effort could expand to over a million new jobs across states like New York with federal incentives to increase hiring. Even that would be hardly enough.

Even more importantly, along with a serious decline in public and private investments, the federal job training system is badly disjointed. An Urban Institute study characterized the public workforce system as a “patchwork quilt,” wherefederal investments for job centers, apprenticeships, career and technical education, job corps, block grants, and other programs are siloed, with little coordination or integration. Spending is far too low on programs that work, and far too high for those that don’t. In the age of data science, ironically, we have no idea how many people are currently being served by job-training programs and the degree to which they meet employers’ needs.

An effective response to Covid-19’s employment crisis demands urgent action. This is what is needed.

First and foremost, a real jobs strategy must be elevated to the highest level with the appointment of a new White House task force on jobs. It needs to be de-politicized with cross-agency representation, and a bipartisan set of state and local officials to ensure linkage to local funding and actions. Representation must include education and community leaders. Such a federal task force would be charged with creating a uniform U.S. jobs strategy with mandatory, regular, public reporting not only about progress with moving people off unemployment rolls, but on both preservation and creation of jobs. The task force would focus increased federal, state, local, and private-sector investments on the most effective job training, education, and workforce development efforts, consolidating funding and structures and eliminating waste, putting an end to the patchwork quilt of programs. 

Importantly, we must understand that there will be a need for increased federal investment joined with private-sector investment in the most successful jobs strategies. In one example highlighted in an Aspen Institute study by Robert I. Lerman, “Scaling Apprenticeship to Increase Human Capital,” the number of apprenticeships in countries like Germany, Canada, Switzerland, Australia, and England are ten times higher than in the U.S.Apprenticeships with guaranteed hiring commitments by employers must be increased, including investment focused on higher-wage opportunities that produce concrete returns in terms of enhanced skills and actual employment.

In another example, Department of Education funding for career and technical education that creates a clear path from school to career must also be increased for education-reform programs like P-TECH, created by IBM, where students get a combined high-school diploma and an Associates degree in fields like cybersecurity. These graduates move into high-wage jobs in companies like IBM, Global Foundries, and Tesla. This kind of program, which former President
Barack Obama
said must be made available to students nationwide, and which President Donald Trump highlighted in an Oval Office meeting with
Angela Merkel
of Germany attended by P-TECH graduates, needs a full-throated financial commitment.

With government incentives, the percentage of private-sector supply-chain spending with small businesses, especially women and minority-owned businesses who have been devastated by the pandemic, can significantly increase. Steering resources toward these businesses will add jobs and stimulate growth.

A Covid-19 vaccine may become available in several months, but when the pandemic is finally over, it will not solve the jobs crisis. An economic recovery may still be years away, and Americans can’t afford to wait that long. The cost in the short and long term is far too great. Jobs and a lack of education and skills is in many ways just as serious a problem as the pandemic itself. It demands action, now.

Stanley Litow is a professor at Duke and Columbia universities, and serves as innovator-in-residence at Duke. He previously served as deputy chancellor of schools for New York and as president of the IBM Foundation.

Next Post

CBS All Access joining the 'plus' branding bandwagon

CBS will rebrand its streaming service CBS All Access as Paramount+ in 2021 parent company ViacomCBS announced. CBS launched the streamer in 2014. After CBS and Viacom merged again in 2019, the combined company would eventually announce a two part reshaping of the service. The first phase was adding around […] WordPress Theme: Seek by ThemeInWP