With close to 11 million unfilled jobs, more than 8 million unemployed Americans, and lackluster hiring that (according to the Department of Labor’s most recent jobs report) missed expectations by nearly half a million jobs, our economy is once again facing an employment paradox. Getting more Americans off the economic sidelines is important for both individual families and our economy overall.
But people aren’t widgets, and it’s not as simple as connecting the 8.4 million Americans who are out of work with the 11 million openings.
Whether the cause of this mismatch is workers who lack the skills employers want, or that a “great reassessment” is causing workers to reevaluate their jobs and seek new careers, the result is the same: Workers will need to learn new things. And that is where our workforce paradox may be exacerbated by another paradox: the paradox of choice.
At a fundamental level, our labor market puts the onus for finding a job on an individual. It further expects that job seekers can not only navigate job opportunities, but figure out where and how to obtain the credentials, skills, or experiences they need to qualify. That system assumes a degree of transparency to help individuals differentiate among a maze of nearly a million credentials to make the right choice. Perhaps it was better suited to a less complex labor market, but it doesn’t often work that well today. And it may get worse before it gets better.
Even prior to the pandemic, the world of work was undergoing profound transformation. According to a survey of corporate leaders in fall 2019, 70% of employers planned to lay off workers due to the implementation of new technology. We’re now seeing indications that the pandemic has actually accelerated that change, triggering what economist David Autor has referred to as an “automation-forcing event.”
That “event” won’t just eliminate jobs; it will create entirely new ones. Amazon recently announced that they will be opening two Whole Foods locations in 2022 with no cashiers — but will hire a similar number of overall staff, in new and no doubt evolving roles.
Congress is currently considering $80 billion in new funding for workforce development. But absent a concomitant focus on wayfinding, increased funding for education and training misses the point.
Our system of higher education has, after all, been created to enable choice, not limit it. Pell Grants were designed to flow to the students, rather than schools directly. As designed, this was a feature, not a bug: It put the power of choice in the hands of the consumer. Workers also have less help than prior generations, who often relied on unions or employers to support their education and transitions. And government supports, like American Job Centers (also known as local One Stop centers), have, up to this point, been chronically under-funded.
All this means that in a moment of tremendous economic uncertainty, existing systems and approaches are falling short. We’re forcing individuals to make a high-stakes decision with limited information on likely outcomes that threaten to negatively impact both individual economic opportunity — and our broader economic recovery.
It doesn’t have to be that way. While funding alone won't solve the problem, limited choice won't either. What workers need, more than ever, are better wayfinding tools — resources like coaching and insights to help guide workers and students along their path, and personalized approaches, like last-mile training programs and apprenticeships, that make the most of the skills workers already bring to the table. These remove friction from the matching process by identifying the most efficient and cost-effective way to get individuals to the job they aspire to have.
Karin Norington-Reaves, who leads the Chicago Cook Workforce Partnership is grappling with what she describes as a “first mile” training problem head-on. She is charged with serving an increasingly broad spectrum of individuals, “from opportunity youth, to seniors, to those over 50 trying to get back into the workforce.” That isn’t easy. Because “while their needs and personal goals are all very different, most of them struggle to find the right way to ‘plug into’; the workforce system—what jobs am I qualified for, what training do I need to get those jobs, what are the high-growth, high-demand occupations in Chicago that are hiring right now.”
To effectively support workers and close the first mile gap, wayfinding must be rooted in real-world labor market data. Fortunately, this is more feasible than ever. The digitization of the labor market in the years since the Great Recession (job postings, HR IT, application tracking systems) has given rise to not just digital breadcrumbs, but terabytes of data that can now be used to provide clearer insights for those seeking education, training, or jobs.
It’s time to empower individuals with the information, guidance, and support they need. It’s a systemic problem that requires a systemic solution, but together, we can provide the tools that will lead to economic mobility for those seeking work — and a stronger economy for all of us.
Tom Dawson served as deputy assistant secretary at the U.S. Department of Education under President George W. Bush. He is now the interim CEO and president of the nonprofit social impact organization Strada Education Network.