The state of America’s workforce is troubling, what’s next?
In the midst of navigating today’s economy, rife with unpredictability, an unprecedented number of Americans are finding themselves unemployed. As of early April 2020, 17 million Americans have filed for unemployment, a massive job loss that shattered all previous records. In fact, the number of jobs lost in just three weeks is more than the 15 million jobs lost over 18 months during the Great Recession between 2007 and 2009. Still, the number of people filing for unemployment continues to rise. While our current economy is struggling to regain its footing, larger problems plague the broader economic picture.
A majority of Americans have no savings and an equally upsetting amount earn barely enough to cover the cost of living. About 53 million workers ages 18-64, amounting to 44% of all workers nationwide, make around $10.22 an hour or about $18,000 per year.
These low-wage workers mostly hold occupations within the restaurant, retail, personal care, and janitorial industries. A variety of administrative services are also low-paying.
Of these low-wage workers,
- 64% are 25-54, in their prime working years
- 51% are primary earners or contribute substantially to family living expenses
- 37% have children, and of those, 23% live below the poverty line
- 45% of low-wage workers ages 18-24 are in school or already have a college degree
Workers without bachelor’s degrees make up the majority of the low-wage workforce. The definition of a good job for someone without a bachelor’s degree is one that pays at least the national median wage adjusted for the location-dependent cost of living.
While there is an argument to be made that school can help upskill this population, higher education and skills-based training only solve part of the problem. A shortage of well-paying jobs, declining wages, and market failures — expensive healthcare, unaffordable childcare, and overpriced housing — all contribute to an economy that doesn’t serve low-wage workers.
For so much of America’s workforce, the change for better employment resides in two categories: opportunity employment, jobs that are accessible to workers without a bachelor’s degree and pays above the national annual median wage, and the jobs that are reserved for workers with a bachelor’s degree.
Higher-wage jobs that require a bachelor’s degree are within reach for many low-wage workers, but not without accessible, affordable education. For hundreds of thousands of working adults, the only path towards more schooling is through education benefits, primarily upfront tuition payments from employers.
Education benefits will be further defined by the future of work — and how today’s workforce can fit into it:
- People with no postsecondary education will account for nearly 80 percent of all displaced workers by 2030
- More than 90 percent of new jobs are being filled by people with a college degree
- The Bureau of Labor Statistics projects that by 202, roughly 26.6% of today’s employees will be required to have at least a bachelor’s degree, up from 25.8% in 2016
Yet, going back to school is not a reasonable expectation for many low-wage workers who are currently struggling. Add the worst wave of job losses in American history to the already existing economic crisis for low-wage workers, and it’s clear that millions of Americans will have to work extremely hard to get back on their feet.
Right now, people are worried. This is no surprise, given the never-ending news cycle. A recent survey shows that 68% of Americans suffer from some sort of financial stress, and 47% of Americans are worried about losing their jobs.
As we work to rebuild the economy in the coming months — and probably years — it’s worth recognizing that an inclusive economy serves low-wage workers in the same way that it empowers high-wage workers and everyone in between. For everyone, we can do better.