Atlanta's Amazon Quest Points to Importance of 'Success Sequence'
Now that New York City will not be the site of Amazon’s HQ2, Atlanta is back on the short list. Many are buzzing about the prospect of a multi-billion injection into the state’s economy and an estimated 25,000 new jobs. And as wonderful as it is for Georgians to ponder this amazing opportunity, it begs an important question: Who will fill these new jobs?
We all know that Georgia is already excelling when it comes to growth. With Amazon HQ2 in Atlanta, not only would thousands of high-paying jobs be created, but tens of thousands mid-range and lower-skilled jobs would be needed to support and service the new economic reality, thanks to the multiplier effect. Throw into the mix the latest state unemployment figure of 3.6%, a more than 50% drop since March of 2012, and it’s clear that Georgia’s labor market will continue to be a tight one.
Of course, more jobs and low unemployment are signs of a healthy economy. And while the recent tax reform law passed by President Trump and Congress points to even more state-level economic gains, there’s a rumble beneath the surface of the rosy unemployment data that will limit economic expansion if not properly addressed.
Indeed, a closer look at Georgia’s labor force participation rate offers a more sobering explanation of the drop in the state’s unemployment rate. The latest key indicator of economic health stood at only 63.3%, meaning that 36.7% of those 16 years old and older were not employed. While there are several reasons that people are not in the labor force, a leading factor is because many have simply given up looking for work altogether.
Why, in today’s booming economy, have so many stopped looking for a job? Nicholas Eberstadt, a scholar with the American Enterprise Institute, has conducted extensive research on this problem and has focused on how acute the problem is for “prime-age” men. He notes that, nationally, roughly seven million men in their prime working years of 25 to 54 are absent from the labor force today — neither working nor actively searching for work. Alarmingly, this labor-force participation rate for prime-age males has been declining for decades and in 2015 was worse than during the concluding years of the Great Depression. In Georgia, according to our calcuations, there are about 250,000 men who fall into this group.
Here, the crisis of non-working American males in their prime is both well-known and well-documented. These men are more likely to be minorities (particularly African Americans), under-educated (a high school degree or less), and have a low socioeconomic status (a household median income of $25,000 or less). We also know that factors such as drug use, criminality, and a welfare system that encourages subsistence living and discourages family formation are major contributors to the problem.
Simply put, there are hundreds of thousands of Georgians (many of them prime-age men) who are sitting on the sidelines, unable or unwilling to take part in a growing, dynamic, and opportunity-rich economy. And while we celebrate the prospect of a corporate giant like Amazon might choose Atlanta as its HQ2, and wonder how we will fill the jobs, we must not bury our heads in the sand when it comes to broader socio-cultural problems that plague Georgia and threaten to limit our ability to meet the demands of future growth. Instead, we should actively develop strategies for re-integrating these lost workers into the labor force and offer a clear path to a flourishing life.
One way to do this is to help people practice “the success sequence.” Scholars on both the left and right recognize its simplicity and importance, a good education, a steady job, and a healthy family life greatly increase the odds of people achieving economic and social stability.
Specifically, the success sequence emphasizes skills development and connects the unemployed with relevant, proven, work-focused programs that prepare them for work and place them into available jobs.
Beyond this, the sequence recognizes that it’s never too late for someone to get their life back on track and focuses on healthy relationship skills that set the stage for thriving at the family and community level and beyond.
Even if Amazon does not pick Atlanta for its HQ2, now is the time to do everything we can to ensure that individuals currently outside the workforce are equipped to fill the jobs that come with economic expansion, and help them break the poverty cycle.
Eric Cochling is the Executive Vice President and General Counsel of the Georgia Center for Opportunity.