Marianne Wanamaker, a professor of economics at the University of Tennessee and a former member of President Donald Trump’s Council of Economic Advisers, is more concerned about education than more layoffs in 2021. Without skills better aligned with the post-Covid economy, it could Millions find this novelty work instead on robots and other labor-saving technologies, she said.
With 85 million Americans Zahidi and Wanamaker struggled to pay for basic household bills and 10 million fewer jobs than they did a year ago. They said it was time the US government came up with a great deal to help American workers retool for the insecure but green and digital economy.
“There’s a skill mismatch and it’s growing. There needs to be a much greater focus on retraining and professional development, “Zahidi said.” Most governments are not thinking wisely about tomorrow’s markets and tomorrow’s jobs, “she added. What sets America apart is that it has the resources to do something about it – to help individual workers and employers make smarter long-term decisions.
“It’s not just handouts”, but “a way from A to B to C” that people need to land on their feet, said Zahidi. Employers need support just like employees. “When they are not supported by government vacation or income support programs, they are making really short-term decisions,” she said.
“I think we’re giving up on people”
In the past few decades, advanced economies have grown, but often without jobs. Therefore, according to Zahidi, “we can no longer expect our societies to function if we do not address it directly.”
The The WEF says more technology-driven jobs will be created than jobs will be lost in the next five years, but workers will need additional skills and access to training so they can turn around when needed.
The difficulty is that individual workers often do not have the information or resources needed to regularly update their skills throughout their careers, while authorities have also struggled to predict changes in the labor market: from underestimating how many Outsourcing workers would be left behind, to the point of completely ignoring the disruptive possibilities of a pandemic.
Wanamaker says that “it is impossible to predict tomorrow’s skill needs” – meaning governments, for example, shouldn’t run vanity projects where people learn to code – but it does play a role in “juicing up the finances of retraining.”
“In general, we’ve found employers to recognize the business case,” said Zahidi. While training is typically less expensive than months of searching for a new hire, it is easy for employers to reduce upfront training costs, especially during the uncertainty of a pandemic.
Some companies are already making large investments in skills without government support: PWC developed a $ 3 billion retraining program in 2020and Amazon recruited more than 100,000 new employees in 2020 Qualification of the existing employees.
These investments could lead to growing inequality if governments remain on the sidelines and small business workers, the low skilled and the unemployed miss out on these training opportunities.
The risk is real: the national debt is rising and many civil servants are “pretty firm about what people and human skills are about. I think we’re giving up on people, ”said Zahidi.
Becky Frankiewicz, CEO of Manpower North America, said that a nudge is often all it takes to improve a worker’s skills. By Identification of “competence neighborhoods” Employers and their employees can shape career paths through a sector, supported by “quick, short training spurts in the workplace,” she said. According to WEF research, 85 percent of people can retrain to jobs with related skills within a few weeks.
2021 will be a turning point in the labor market
The National Skills Coalition (NSC), which is supported by a number of foundations and large corporations, including J.P. Morgan and Deloitte, urges the new Biden administration to actively invest in skills. “Better to build back by getting everyone involved.” said Andy Van Kleunen, CEO of NSC. “That means making sure people’s essential needs are met as they train for new jobs, new industries and technologies.”
Wanamaker agrees, and sees the 2020 expanded unemployment insurance program – “the famous one where we gave people six hundred dollars a week in addition to their state unemployment insurance payment” – as a test run for broader universal basic income systems. “Even after the pandemic ends, we will all remember the moment when we said, ‘Wait, everyone is making this amount of money to pay for housing and food,” she said.
With total US GDP unlikely to exceed pre-pandemic levels by the end of 2021, the high unemployment rate may continue well into 2022. “Traditionally, a labor market recovery takes a full year after a production recovery,” said Wanamaker, suggesting investment in a new safety net is needed now if Biden is to see results in 2022.