THE COMING WORKER MELTDOWN
Unfortunate convergence of economic factors points to a shortfall in trained employees
By Edward E. Gordon, author of "The 2010 Meltdown: Solving the Impending Jobs Crisis"
Published December 11, 2005
A unique combination of events--the accelerated rise of advanced technologies, globalization after the fall of communism, the 1990s stock-market bubble and its collapse, and a massive number of people retiring--have combined to produce a potential 2010 workforce meltdown.
The 79 million Baby Boomers who are running the world's industrial economies will retire between 2010 and 2025. A smaller Generation X, with 40 million people and fewer entry-level "smart" workers, will take over.
A great mismatch of too many low-skilled workers and too many high-skill jobs is set to reach stellar heights. As these high-skill jobs go unfilled, American businesses will search the world in vain for more highly skilled, job-ready workers.
According to several studies, between 2010 and 2020 the U.S., Europe, Japan, China and India will face a shortfall of between 32 million to 39 million well-educated, technically specialized "smart people." The current business strategies of outsourcing these high-skill jobs or using H-1B temporary visas to import the workers won't work anymore. Millions of lower-skilled Americans, or people educated for careers that aren't growing or are obsolete, will sit on the economic sidelines, either unemployed or condemned to a future of low wages.
A technology paradox for the U.S.industrial and manufacturing sectors that have laid off millions of low-skilled workers is that they cannot find enough people to fill growing numbers of advanced technology jobs.
A 2002 Hudson Institute study found that 60 percent of all the jobs being created require skills that only 20 percent of U.S. workers possess. For example, in November 2004, Pennsylvania reported that nearly 350,000 workers were unemployed. At the same time, 24 percent of businesses told the state they couldn't find enough qualified workers.
Between 2000 and 2005, 200,000 manufacturing jobs disappeared from Illinois. Some of these were high-pay, high-skill jobs that went elsewhere to find the workers companies can't find here. These 2010 meltdown issues do not bode well for the long-term economic development of Illinois. We need to face the facts that in contemporary America there are just too many people trained for the wrong jobs and not enough people preparing for the jobs we are creating.
The career aspirations of much of the population in the U.S. are at serious odds with the increasingly high-tech needs of the economy. Unless this culture lag is resolved in a timely way, a growing labor market imbalance will have serious economic consequences. The high standards of American life are built on a complex technological and physical infrastructure that everyone takes for granted. Its maintenance is central to the prosperity of our economy. Many areas of industry and service within our economy are involved, with health care, manufacturing, information technology and the skilled trades constituting particularly critical sectors.
Yet as the Commission on the Future of the U.S. Aerospace Industry has stated, "The nation's apathy toward developing a scientifically and technologically trained workforce is the equivalent of intellectual and industrial disarmament ... and is a direct threat to our nation's capability to continue as a world leader."
According to Rick Stephens, senior vice president of human resources at Boeing Corp., "The shrinkage of a U.S. technically able workforce is the greatest threat to our national security."
Many Americans already are responding to the 2010 challenge. Intel, Microsoft, IBM and others are investing more than $50 billion each year in worker retraining and student career-education programs.
Many communities have organized a variety of non-governmental organizations (NGOs), such as Bridge to Careers of Santa Ana, Calif., the Philadelphia Academies Inc. or the Tulsa Technology Center. These intermediary agencies help bridge the chasm that separates the business and labor markets from education and career preparation.
The NGOs seek to retrain adult workers through a variety of education and skills programs attuned to the needs of local labor markets. They also strive to reinvent an outmoded educational system that traditionally has sorted students into two groups: "the best and the brightest" going to college and the others who won't.
These NGO alternatives place all students in local liberal arts/career academies that prepare everyone for post-secondary education. The major objective is that most students will complete a post-secondary, two- or four-year degree or an occupational program certificate.
NGOs can facilitate a 21st Century career culture that better prepares students and adults for the careers of a technologically driven, globally competitive society. Chicago's Renaissance 2010 Program is focused on developing 100 special academies. But Chicago has 600 public schools. Will it take an entire generation to reinvent education in Chicago? Do we have the time?
America needs to embark on a new era of reconstruction to avoid a 2010 meltdown. The future depends on our individual and collective will to make the necessary culture changes now for a new Americaand a new Illinois.
Edward E. Gordon is the author of "The 2010 Meltdown: Solving the Impending Jobs Crisis." He also serves on the Chicago Workforce Board and the Education Workforce Committee of the Chicagoland Chamber of Commerce.
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