Middle Skill Level Jobs Continue to Decline, Solutions?

A NY Fed study concludes in part:

While job prospects for high-skill workers and some low-skill workers have generally improved in recent decades, job opportunities for many middle-skill workers continue to dwindle. As a result, some of the traditional pathways to the middle class—such as working on a factory floor upon graduation from high school—have become increasingly difficult to follow.

These trends suggest that building skills is more important for workers than ever before. For those entering the workforce, this means that the skill set they possess will greatly infl uence the types of jobs for which they will qualify and the wage they can expect to earn. A college education provides one clear pathway to help these workers develop the skills that are required to perform high-skill jobs. Thus, focusing on ways to make a college education more accessible and fostering the ability of students to complete their degrees—particularly in the science and technical fields where the bulk of the high-skill job growth has been concentrated—would be beneficial. In addition, programs other than a traditional undergraduate or graduate degree may provide an alternative way to help people build skills that will be directly applicable to available jobs.

Those workers who are displaced from middle-skill jobs face a more difficult situation than those yet to enter the workforce because they often incur large and permanent wage losses and, in some cases, never fully recover from the job loss.8 Thus, determining how best to mitigate the consequences of job polarization for these workers poses a significant challenge.

While there are no easy solutions to this growing problem, programs designed to help displaced workers retrain and build skills can improve both reemployment prospects and earnings potential. However, such programs vary in terms of their effectiveness, so it is important to determine how to best support programs that produce the most favorable outcomes.

The effectiveness of educational institutions and workforce training programs can be enhanced through close ties with employers. Partnerships of this nature allow firms to communicate their needs to those who are helping people develop the necessary skills to qualify for available jobs. In turn, these collaborations can help educational institutions design relevant programs and identify opportunities for the people they train.

The economic forces driving job polarization have existed for decades and are likely to continue. While these forces pose many challenges, they have allowed a significant and growing number of workers to become more productive and earn higher wages. Thus, given the reduction in opportunities for middleskill workers, it is especially important to help people build the skills necessary to take on the high-skill jobs that these forces can create. Individuals, employers, educational institutions, and policymakers each have a role to play in helping the workforce adapt to this changing economic environment.

read source report from NY Fed