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/ Youth Unemployment in a Changing Economy OVERVIEW Unemployment among young Americans is currently a serious and complex problem. Some of the nearly 3 million people ages 16-21 who could not find full-time or part-time jobs in 1982 are victims of the ailing U.S. economy. Presumably some of them will be able to get and hold jobs once the current recession has eased. Some of them are simply engaged in looking for jobs and will find them in time. Others may be the victims of various social conditions structural changes in the economy; lingering discrimination on the basis of racial or ethnic background, gender, or age; or an education system that has not kept pace with technological change or has not taught all students basic educational or occupational skills. These latter young peo- ple, many of whom are high-school dropouts, are unemployed and perhaps unemployable because they lack the basic skills, the occupational skills, or the attitudes necessary in the workplace. They represent a major failing of the education system, even though some may have passed "successfully" through that system. It is this system, in particular vocation- al education in the public high schools, that is the focus of this report. Our goal in this report is to recommend ways in which the education system, particularly the public vocational education system, can be im- proved in order to enhance the employability of its graduates. We recom- mend strengthening the ties between vocational education and employers as a means of improving vocational education programs. We outline in- stitutional changes that will be required of the vocational education system before effective collaborative efforts with business and industry can be made. We believe also that education and training constitute a lifelong 3

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4 EDUCATION FOR TOMORROW'S JOBS endeavor to keep every person's knowledge and skills up-to-date and that education and employment policies should be made consistent with that view. Because of the rapid rate of technological change in our society, it is no longer practical or feasible to consider that people receive all the training they will need throughout their careers while they are young and in school. We begin by presenting the economic context of the study. In this first chapter we discuss structural changes in the U. S. economy, changes in the nature of jobs, and changes in the skills required in jobs that affect people's employment prospects. We then narrow the scope of the discussion to youth unemployment, describing its nature and extent and putting it in the context of national economic conditions. We highlight the education implications of these different types of employment conditions. We try to portray the complexity and severity of the problem by examining employment ex- periences for different groups of young people, their educational back- grounds, the types of work they are seeking, and other relevant social factors. Clearly, unemployment has vastly different meanings for different groups of young people. For example, a 17-year-old high-school student living with his or her middle-class parents may be looking for a part-timejob principally to earn extra spending money. In contrast, unemployment would have much more serious implications for a 19-year-old male high- school dropout trying to support his family and himself or for a 20-year-old divorced mother trying to support her child and herself. We go on to describe the current vocational education system in Chapter 2, highlighting the diversity of offerings and the variable quality of its programs. We describe the institutional and administrative arrangements typical of vocational education programs. Working from recent evaluative studies, we describe those programs that tend to expand and improve the education and employment prospects of their graduates. We observe that good vocational education programs are often distinguished by their close ties with business, a theme that is developed more fully in Chapter 3. We also analyze problems relating to limited access to high-quality programs available to the students most in need of education and employment oppor- tunities. In Chapter 3 we discuss collaborative ventures involving vocational education, private-sector employers, labor unions, and community-based organizations. Collaboration is not a novel idea; such efforts have been made for years, but they could be expanded considerably to improve the education and the employability of the students. We outline some economic development strategies involving education and training that are intended to accommodate technological changes and restore health to the economies of depressed areas. Such strategies are characterized by collaboration between vocational education programs and private-sector employers.

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Youth Unemployment in a Changing Economy The committee then presents its conclusions regarding the strengths and weaknesses of the vocational education system and its diverse programs in Chapter 4. We present our argument for using an improved system of vocational education as an available, practical, and effective means of combating the employment problems of many American young people. We present recommendations for strengthening vocational education so that it, in turn, can help young Americans and, ultimately, the economy. We argue that links between school and work should be strengthened because they will help improve the quality and increase the relevance of the training that vocational education students receive. We describe features of the many forms of collaborative efforts that appear to be necessary for success, and we outline measures designed to reduce rigidities within the vocational education system so that collaborative efforts can occur without impedi- ment. We emphasize our belief in the value of supervised work experience for vocational education students by describing the important features of beneficial arrangements, recommending expanded opportunities for stu- dents to work, and recommending some modifications in work experience programs. We present two sets of recommendations for improving vocational edu- cation, especially in high schools. The first concerns teachers their certification, their training (both pre-service and in-service), their pay scales, and the use of part-time teachers. The second deals with the financ- ing of vocational education funding formulas, pooling equipment, and funding for program improvement. We conclude by suggesting ex- perimental approaches to improve the access of disadvantaged students to high-quality vocational education programs. 5 STRUCTURAL CHANGES IN THE ECONOMY Fundamental changes in the American economy over the last 40 years in the types of goods manufactured here, in the ways in which those goods are produced, in the types of services that are rendered, in the balance between the manufacturing and service sectors, in the position of the United States in the world economy, and in the responses of the private sector to technologi- cal innovation have had dramatic effects on the nature of jobs. Many education and training programs have not kept pace with these structural changes and with technological advances affecting large numbers of occupations. The Shift from Manufacturing to Service Jobs Discussion about unemployment currently turns rather quickly to the topic of changes in the types of jobs in the American economy the widely

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6 EDUCATION FOR TOMORROW'S JOBS discussed shift from manufacturing to service jobs. Manufacturing is gener- ally taken to include the production of goods (everything from paper clips, bakery goods, and automobiles to industrial equipment) as well as the processing of materials (petroleum products, metals, plastics, and chemi- cals, for example). The service sector includes such a diversity of jobs that some economists discourage grouping them together under the term service sector because of its illusion of uniformity (see Stanback et al., 19811. One classification scheme, used by the Committee on National Urban Policy (Hanson, 1983), divides the service sector into the following categories: distributive services, the complex of corporate activities and producer services (such as finance, insurance, real estate), nonprofit services (health and education), retail services, consumer services (for example, hotels, auto repair, amusements), and government and government enterprises. Furthermore, as we shall see, not all jobs in the manufacturing sector are directly involved in the production process; some of them are very similar to jobs in the service sector. The proportion of jobs in the manufacturing sector has been declining since the end of World War II, while the proportion in the service sector has been increasing (Table 11. In 1940, 34 percent of nonagricultural workers were engaged in manufacturing. This proportion decreased to 22 percent in 1980. Between 1940 and 1980 employment in the service sector rose from 59 percent to 72 percent of all those employed outside agriculture. From Table 1 we can calculate that approximately 84 percent of all new jobs introduced into the economy between 1940 and 1980 were in the service sector. Changes in union membership over time give further testimony to these economic shifts. The National Commission for Employment Policy ~ 1982) noted that in 1960 the United Auto Workers and the United Steelworkers of America were the two largest unions in the AFL-CIO. By 1980 the two largest unions were the United Food and Commercial Workers and the American Federation of State, County, and Municipal Employees. Compared with the period before World War II, manufacturing indus- tries currently employ proportionately fewer workers to actually make products, while more workers are involved in invention, design, manage- ment, and sales. And the changes continue, many say at an accelerating rate. Some jobs currently filled by workers will be performed by robots, and other jobs will involve working with the robots. An increasing proportion of manufacturing jobs require some education or training, and there are fewer jobs for low-skilled manual laborers (Hanson, 19831. Some jobs now require more knowledge, while others are being broken into discrete, routine components that require little thought and even less imagination.

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Youth Unemployment in a Changing Economy TABLE 1 Percentage Distribution of Employees on Nonagricultural Payrolls, by Industry Division, 1940-1980 7 Industry Division19401950196019701980 Total100100100100100 (32,361)(45,197)(54,189)(70,880)(90,406) Goods-producing4141373328 (13,221)(18,506)(20,434)(23,578)(25,658) Mining32111 (925)(901)(712)(623)(1,027) Construction45555 (1,311)(2,364)(2,926)(3,588)(4,346) Manufacturing3434312722 (10,985)(15,241)(16,796)(19,367)(20,285) Service-producing5959626772 (19,140)(26,691)(33,755)(47,302)(67,748) Transportation and99766 public utilities(3,038)(4,034)(4,004)(4,515)(5,146) Wholesale and2121212122 retail trade(6,750)(9,386)(11,391)(14,040)(20,310) Finance, insurance,54556 real estate(1,485)(1,888)(2,629)(3,645)(5,160) Services1112141620 (3,665)(5,357)(7,378)(11,548)(17,890) Government1313151818 (4,202)(6,026)(8,353)(12,554)(16,241) Federal34443 (996)(1,928)(2,270)(2,731)(2,866) State and local109111415 (3,206)(4,098)(6,083)(9,823)(13,375) NOTE: Numbers in parentheses represent thousands. SOURCE: Bureau of Labor Statistics, 1983, Employment and Earnings 30(3) March: Table B-1. There is diversity and change in the service sector as well. Some jobs require considerable knowledge or education, but others do not. The more knowledge-intensive jobs, having higher status, offer good incomes and opportunities for advancement. Stanback et al. ( 1981 ) present an analysis of

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8 EDUCATION FOR TOMORROW'S JOBS data from the 1970 census showing that in general those employed in service jobs have higher education levels than those working in manufactur- ing (Table 24. Of course in some service jobs, such as cleaning and maintenance of dwellings and other buildings, education levels are roughly the same as or lower than levels in manufacturing jobs. They conclude that most young people today enter the labor market through jobs in retailing and consumer services rather than through jobs in farming or manufacturing, as they did before World War II. Since these service jobs generally require more education than those in manufacturing, we conclude that structural shifts in the economy will probably require, on the average, more rather than less education of employees than in the past. It is not clear that young people need a great deal of education and training for the jobs they will hold while they are young. According to analysis of the spring 1981 survey of the National Longitudinal Surveys (NLS) of Youth Labor Market Experience (Bows, 1983), about 28 percent of the jobs held by people ages 16-21 required only an elementary-school education. Just over half required less than a high-school diploma, about 14 percent required a diploma, and 7 percent required some college education. According to the NLS, almost half the jobs held by people ages 16-21 required no more training than a short demonstration, 22 percent required less than 30 days of on-thejob training, and another 19 percent demanded no more than three months of training. This means that 87 percent of the jobs required less than 3 months of training. It is not safe to conclude from these data, however, that young people do not need or would not benefit from more education and training. Given the aspirations of most people to advance in their careers and given the structur- al changes in the economy affecting the skills required in jobs, it may well be that young people need better education and training to prepare for their careers. The jobs they hold as teenagers or young adults are likely to require less education and training than the jobs they will hold later. TABLE 2 Percentage Distribution of Employed People, by Employment Sector and Number of Years of Education Years of Years of Elementary and Years of Graduate Secondary School College Work Sector 0-8 9-12 1-2 3-4 1-2 Manufacturing 28.8 57.7 3.0 6.0 4.0 Services 15.1 45.6 10.5 15.3 13.6 SOURCE: Stanback et al. (1981: Table 4.9). Reprinted by permission.

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Youth Unemployment in a Changing Economy 9 Technological Changes in the Workplace Virtually no part of the U.S. economy has been untouched by technological advances. One indication of the pervasiveness of technological change is the September 1982 issue of Scientific American, which is devoted entirely to the mechanization of work. Among other topics, the articles discussed the mechanization of agriculture, mining, design and manufacturing, com- merce, and office work. Vocational education programs are available in all of these areas. The importance of technological innovation for vocational education programs can scarcely be overestimated. While all agree that the nature of jobs changes as a result of technological innovation, there seems to be little agreement among analysts regarding the likely nature of those changes over the next 20 years or so and their effects on the education and training required for the new or altered jobs. On one side are those who argue that the adoption of technological innovations will increase the skill levels required for jobs (Ayres and Miller, 19811. They argue that the workers so displaced will be the lower-skilled workers and that the newly created jobs will require more sophisticated technical train- ing or managerial or other typically white-collar skills. (Whether the work- ers who are displaced can be retrained for the new jobs that would presum- ably be created is another question.) On the other side are those who believe that the widespread use of computerized systems will routinize jobs and increase the demand for low-skilled workers (see Levin and Rumberger, 1983; Vedder, 19821. Levin and Rumberger note that, while the fastest growth may be in computer-related occupations, the figures on percentage growth may be misleading because such jobs account for a very small proportion of the total work force. They cite figures from the U. S. Depart- ment of Labor projecting that 150,000 new jobs for computer programmers would be created in the 1980s; however, the estimate for janitors, nurse's aides, and orderlies is 1.3 million new jobs. They argue further that most of the jobs altered by computers will require only the most rudimentary of skills and certainly no high level of competence with computers. As computers become more sophisticated, those who use them can be less sophisticated. The potentially disruptive effects of the automation of manufacturing on workers has been aptly described by the National Commission for Employ- ment Policy ~ 1982:71: Workers may be threatened in the short term by loss of their jobs due to rapid automation of manufacturing plants and in the long term by the possible crippling of whole industries if manufacturers fail to automate rapidly enough or otherwise change their production techniques or wage costs to meet foreign competition. That

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10 EDUCATION FOR TOMORROW'S JOBS the nation's unemployment rate exceeded 10 percent for the first time in 4 decades in September 1982, reflects not only the current recession, but also the dis- appearance of thousands of jobs in traditional "smokestack industries" such as iron, rubber, and steel, as well as in automobile manufacturing and other basic industries. Many workers in these industries who previously enjoyed both security and high salaries have consequently been left without work and often without applicable skills to compete in an emerging high-technology economy [emphasis added). The potential effects of technological change on jobs are much more complex and pervasive than they may at first appear. The work of assembly- line employees, product designers, inventory clerks, managers, and execu- tives can be revolutionized. Gunn (1982) notes that adopting new methods in one part of the manufacturing process has implications for other parts and for the cost and efficiency of the entire process. For example, using computers to facilitate the design of products is estimated to improve productivity in the drafting room by a factor of three or more. In addition, it results in higher-quality components that can be assembled faster and more easily and that ultimately result in a better product. The increasing use of robots in industry raises concerns about the dis- placement of workers and the reshaping of training programs. Industrial robots are not the humanlike androids seen in science fiction movies. Instead, they are machine tools that can be programmed to move parts or tools through a specified series of motions. Some robots can be reprogram- med to perform different tasks without changing their hardware. Robots are best used in highly structured manufacturing situations in which there is virtually no variability or need for making decisions. The most common current applications include spot welding, spray painting, and loading and unloading metal cutting or forming machines, all of which have historically been taught in trade and industrial programs in vocational education. Robots are valued because of their predictability, reliability, and relative insensitivity to unpleasant environments. One of their major disadvantages is that, unlike humans, they are unable to react to unexpected situations or changes in their routines or environments, and they do not learn from past experience. Although robots are available that have rudimentary "senses" of sight and touch and that "learn" in a limited way, they are not yet commonly used in industry. The Robotics Institute of Carnegie-Mellon University surveyed the members of the Robot Institute of America (robot users and producers) regarding their use of robots in various occupations, almost all in metalworking (Ayres and Miller, 19811. The results showed that robots are used most in nine occupations, which currently employ 3 million workers. A predicted half million of these workers could potentially be replaced by the type of robots currently used in industry. The most severely affected

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Youth Unemployment in a Changing Economy 11 would be production workers engaged in welding, painting, and operating machine tools. One million more could possibly be replaced with the more sophisticated sensing robots. The researchers estimate that as many as 3 million workers in the areas of assembling, packaging, grinding, electro- plating, and inspecting could potentially be replaced by sensing robots but that this displacement would take at least 20 years. They also note that six metalworking occupational categories for which vocational education offers training are likely to be seriously affected by robotization. These six categories accounted for approximately 3 percent of all vocational educa- tion enrollments in 1978 (almost a half million students). While some believe that the widespread use of robots will lead to unemployment, others are not convinced and focus instead on the retraining of workers displaced by robots. As noted in a staff report on robotics and the economy prepared for the Joint Economic Committee of the U. S. Congress, "the challenge to policymakers due to increased use of robots is not unem- ployment but retraining" (Vedder, 1982:21. Vedder argues that robots will not increase unemployment but will instead improve productivity and thereby create more jobs. He reasons that the people who will be displaced by robots can be retrained to manage them or repair them or to do other production jobs that cannot be accomplished by robots. Others see potentially far-reaching and long-term benefits of the in- creased automation of American industry (National Commission for Em- ployment Policy, 19821. If manufacturers can decrease the price of goods by increasing the efficiency of production, the demand for such products could actually increase employment. (But the skill requirements of the new jobs, of course, would differ from those of the old.) If robots assume the most difficult and dangerous jobs, working conditions for people could be improved. In addition, automation could help to restore America's in- dustrial base. Regardless of which analysis one prefers, there are education and train- ing implications for educators and students as well as the people currently employed in affected industries. Clearly, educators should maintain close contact with employers who use or are likely to begin using robots to determine the training implications for their programs. Changes in the ways in which information is processed are also affecting a large portion of jobs in the U. S. economy. The National Commission for Employment Policy (1982) cited one estimate of the pervasiveness of telecommunication and computer technologies on occupations: approxi- mately 55 percent of all U.S. workers in 1980 were employed in informa- tion-related occupations generating, storing, transmitting, or manipulat- ing data. The effects of changes in information processing on jobs and their skill requirements are complex and changing. For example, file and billing

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12 EDUCATION FOR TOMORROW'S JOBS clerks and operators of older office machines are finding themselves with obsolete skills, while computer programmers and installers of cable televi- sion lines are in high demand. Yet not all computer-related jobs are increas- ing in number. As computerized equipment becomes more sophisticated, some of the earliest computer-related jobs, such as keypunching, are being phased out. Some analysts view these technological changes with great optimism, both for specific geographic areas and for the health of the entire U.S. economy. A report on economic trends in New York City (Design for Academic Progress for the 80's Task Force #5, no date) expresses the view that jobs created by the "information revolution" can help revitalize the economy of that city. The jobs that have expanded in the last decade or so in New York City have been related to the creation, processing, and distribu- tion of information the media, telecommunications, printing, publishing, banking, insurance, the stock market, and others. The report notes that, although New York has lost many of its routine manufacturing jobs to overseas locations such as Hong Kong and Taiwan, the knowledge- intensive components of those industries-managing, design, marketing, and clerical work have remained in New York. Thus, the nature of the jobs in the city has changed and has resulted in a change in the skills needed from employees. The need for unskilled workers has been reduced and that for technically skilled workers has increased, posing a challenge to the education system to train residents to fill the newly created jobs. In order to learn about current practices in education and training relating to automation in manufacturing, the Office of Technology Assessment conducted a survey in 1982 of firms likely to use programmable automation in manufacturing (those making electric and electronics equipment, in- dustrial machinery, and transportation equipment); producers of pro- grammable automation equipment and systems; and educators and others involved in instruction, including labor unions. Results of the survey are reported in a technical memorandum (Office of Technology Assessment, 1983~. About 40 percent of the manufacturing firms use programmable automation and about 22 percent sponsor or conduct training in the new technologies. Of those who do not offer training, only about 18 percent plan to do so in the future. This figure, the report notes, seems surprisingly low, given that virtually all the respondents manufacturers and those involved in education or training felt that industries should bear the cost of training employees to work with the new technologies. This finding could indicate that, while industries are reluctant to conduct their own programs, they are willing to pay for training conducted by others. Alternatively, it could mean that the changes in jobs caused by automation are not yet sufficient to warrant establishing formal training programs.

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Youth Unemployment in a Changing Economy YOUTH UNEMPLOYMENT IN THE 1980S 13 According to the Bureau of Labor Statistics (BLS), in 1982 the annual average unemployment rate for the country as a whole was 9.7 percent, and the rate for people ages 16- 19 was 23.2 percent. The unemployment rate for blacks in that age bracket reached a staggering 48.0 percent and that for people of Hispanic origin was 29.9 percent (see Table 31. These 1982 figures represent a seasonal adjustment of the monthly data gathered in the Current Population Survey of households across the United States. Table 4 gives the 1982 BLS figures for people ages 16-21, showing a slightly different picture. The unemployment rate for the entire civilian labor force for that age group is 20.5 percent, while that for blacks and others is 38.5 percent. The figures are lower than those cited above because people ages 20 and 21 as a group are unemployed less often than those ages 16-19. Of those ages 16-21 who report that their major activity is going to school, almost 24 percent are unemployed. The corresponding figure for blacks and others is 47.3 percent. Of those unemployed while in school, most are looking for part-time work-about 85 percent of whites and about 74 percent of blacks and others. While it is undoubtedly true that many students who are looking for work are doing so primarily so they can have more spending money, there are also some who need the money to support themselves or their families for whom the lack of a part-time job is quite serious. TABLE 3 Annual Unemployment Rates by Gender, Age, and Race or Ethnic Origin, 1981 and 1982 (Household Data) Total White Black Hispanic Total, age 16 and over 1981 7.6 6.7 15.6 10.4 1982 9.7 8.6 18.9 13.8 Ages 16-19 1981 19.6 17.3 41.4 24.0 1982 23.2 20.4 48.0 29.9 Males, ages 16-19 1981 20.1 17.9 40.7 24.3 1982 24.4 21.7 48.9 31.2 Females, ages 16- 19 1981 19.0 16.6 42.2 23.5 1982 21.9 19.0 47.1 28.2 SOURCE: Bureau of Labor Statistics, 1983, Employment and Earnings 30(1) January: Table 51.

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14 EDUCATION FOR TOMORROW'S JOBS TABLE 4 Employment Status of the Noninstitutionalized Population Ages 16-21, Annual Averages for 1982 (Numbers in Thousands) Black TotalWhiteand Other Total noninstitutionalized population24,69020,5204,170 Total labor force15,24013,2332,007 Percent of population61.764.548.1 Civilian labor force14,54712,7061,841 Employed11,56110,4291,132 Agriculture55752433 Nonagricultural industries11,0059,9051,100 Unemployed2,9862,227709 Looking for full-time work2,0181,499519 Looking for part-time work968778190 Percent of labor force20.517.938.5 Not in labor force9,4507,2872,163 Major activity going to school Civilian labor force3,4763,100376 Employed2,6462,448198 Agriculture1191154 Nonagr~culture industries2,5272,333194 Unemployed830652178 Looking for full-time work1429646 Looking for part-time work688556132 Percent of labor force23.921.047.3 Not in labor force6,3974,9731,432 Major activity other Civilian labor force11,0719,6071,465 Employed8,9157,981934 Agriculture43740929 Nonagricultural industries8,4787,573905 Unemployed2,1561,625531 Looking for full-time work1,8761,403473 Looking for part-time work28022258 Percent of labor force19.516.936.2 Not in labor force3,0532,313740 SOURCE: Bureau of Labor Statistics, 1983, Employment and Earnings 30(1) January: Table 7. The BLS unemployment figures cited above, which are the ones most often seen in the media, are calculated by dividing the number of unem- ployed individuals by the number in the labor force-that is, those either working or looking for work. Using instead ratios calculated by dividing the number of employed people by the total population for a given group gives a rather different picture, because of differences in the proportion of people in

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Youth Unemployment in a Changing Economy 15 any group who are in the labor force. Table 5 gives employment/population ratios by age and race for 1981 and 1982. In all groups there are at least modest decreases in the employment ratios between 1981 and 1982. All people ages 16-19 are employed at about 60 percent the rate for the population as a whole, at least in part because the teenagers are in school. The teenagers may lack the skills for available jobs or they may not be able to work the hours required because of conflicts with school schedules. The employment/population ratio for black and other teenagers ages 16-19 is about half that for whites in the same age group. If we focused instead on unemployed people and calculated unemployment/population ratios, we would find that the difference between white teenagers and black and other teenagers is markedly smaller than that difference in the BLS unemploy- ment rates cited above. These differences are attenuated by the differences in the proportions of the two groups that are in the labor force: proportion- ately fewer blacks and others ages 16-19 are either working or looking for work. Analysis of a different data set, the spring 1981 survey of the National Longitudinal Surveys (NLS) of Youth Labor Market Experience, enriches our picture of youth unemployment. This section draws on a paper prepared for the committee by Michael E. Borus (19831. Selected tables from this paper are presented in Appendix A. The unemployment rate for this group, composed of people ages 16-21 at the time of the interview, was 20 percent, a slightly higher rate than that found for the same time period in the Current Population Survey by the Bureau of Labor Statistics. The figure from the NLS implies that about 3.5 million young people ages 16-21 were unemployed in spring 1981. Al- though the unemployment rate for young men was generally higher than that for young women, some groups of young women have especially high TABLE 5 Employment/Population Ratios by Age and Race for 1981 and 1982 (Household Data) 1981 1982 Total Total, ages 16-19 White, ages 16-19 Black and other, ages 16-19 .70 .67 .44 .41 .48 .45 .23 .21 SOURCE: Bureau of Labor Statistics, 1983, Employment and Earnings 30(1 ) January: Table 2 and Table 6.

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16 EDUCATION FOR TOMORROW'S JOBS unemployment rates: blacks; high-school dropouts; those with less than a high-school education; those who were married, divorced, or separated; those with children in the household; and those in the Northeast. Borus also found that the rate of unemployment declines as the young people grow older: 16-year-olds have a 31 percent unemployment rate, compared with a 13 percent rate for 21-year-olds. Borus's analysis revealed a direct relationship between unemployment rates and lack of schooling, indicating that young people who drop out of high school have greater difficulty finding jobs than do their peers who graduate. High-school dropouts have extremely high unemployment rates-37 percent for female dropouts and 29 percent for male dropouts. They are often seen as lacking the skills, discipline, and motivation neces- sary to hold jobs. The unemployment rates for high-school students are only slightly lower-26 percent for females and 29 percent for males. Presum- ably students have difficulty getting jobs, in part because the hours they can work are constrained by their schooling and study. The less education young people have, the more trouble they have in the labor market. The unemployment rate for those ages 16-21 with less than one year of high school was 40 percent in the NLS sample; the rate for those who had not finished high school was 28 percent; and it was 15 percent for high-school graduates. Those who had completed college (albeit a very small group of those ages 16-21) was only 3 percent. These findings are consistent with those of Meyer and Wise (1982a, 1982b) and Ellwood and Wise (19831. Unemployment rates for minority young people in the spring 1981 NLS sample are higher than those for whites. The rate for blacks was 37 percent; for Hispanics, 24 percent; and for whites, 18 percent. Blacks constituted 23 percent of the unemployed but only 14 percent of the population of those ages 16-21. As might be expected, youth unemployment rates are generally higher in localities with higher unemployment rates for the population as a whole and lower in areas with lower overall unemployment. Borus's analysis fails to support the commonly held view, however, that youth unemployment is highest in inner cities. Borus found that the youth unemployment rates in central cities of standard metropolitan statistical areas (SMSAs) are approx- imately the same as the rates in the areas of SMSAs outside the central cities. As we shall see below, however, the central cities have a higher percentage of hard-core unemployed young people. Borus defined the hard-core unemployed as those who were out of school, who live either on their own or in a household in which the family income is below the poverty level, and who have been looking for work for 10 or more weeks. About 9 percent of the unemployed meet this definition.

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Youth Unemploymerlt in a Changing Economy 17 There were about as many men as women, but there were few 16- or 17-year-olds. There were about equal numbers of people ages 18, 19, 20, and 21 . The rates did not vary greatly by race or ethnic background. About 21 percent of those with no education past the eighth grade were classified as hard-core unemployed, compared with 5 percent of those with some high-school education (presumably many of whom were still in school), and 14 percent of those who had graduated from high school. Of those unemployed, 13 percent in the central city of an SMSA were hard-core unemployed, compared with 6 percent of those in an SMSA but not in the central city. What factors tend to distinguish discouraged workers those no longer looking for work presumably because they believe no jobs are available- from the young people who are looking for work? In Borus's analysis, more discouraged workers were dropouts and fewer were high-school graduates. Proportionately more lived in the South, in rural areas, or outside SMSAs. They tended to be concentrated in areas with high unemployment rates for the population as a whole. The NLS sample includes questions of the young people regarding their reasons for looking for work, the types of jobs they sought, the lowest wage they would accept, and their perceptions of barriers to employment. About half the young people said they were looking for work because they needed money. An additional 20 percent had either lost or quit their previous job. Only about 7 percent said they needed to support themselves or help with family expenses. Not quite half the young people who were unemployed were looking for full-time jobs. They tended to be older and not in school. The NLS queried young people about their perceptions regarding the main reasons for their own unemployment or difficulties in getting a good job. About 45 percent of the respondents said they had been affected by age discrimination, the percentages understandably declining as the age of the respondents increased. High-school dropouts who were 16 or 17 years old perceived age discrimination more frequently than other groups. Sex dis- crimination was cited by 14 percent of the young women and 5 percent of the men. About 20 percent of the blacks and Hispanics felt that they had suffered racial or ethnic discrimination. Lack of transportation was the most frequently mentioned structural barrier to employment, cited by 30 percent of the young people. Lack of experience was cited by 14 percent of the sample. Interestingly, lack of experience became a more commonly cited problem for the older respon- dents. Lack of education was said to be a problem by 6 percent of the sample overall and by 21 percent of the high-school dropouts. In general, Borus's analysis of the NLS data on youth unemployment

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18 EDUCATION FOR TOMORROW'S JOBS reveals that unemployment among Americans ages 16-21 is concentrated among certain groups. The groups with the highest unemployment rates include 16- and 1 7-year-olds, blacks, Hispanics, and high-school dropouts. The jobs typically held by young people require little education or specific training. One cannot conclude from this analysis, however, that education and training are unimportant factors in youth unemployment. Unemploy- ment rates tended to drop with increasing educational attainment, suggest- ing that education and training are important in helping young people prepare for jobs. FACTORS CONTRIBUTING TO YOUTH UNEMPLOYMENT Finding jobs may be difficult for young people for a variety of reasons. They may lack basic skills (such as facility with spoken and written English, with reasoning, and with basic mathematical computations). They may lack the general or specific skills demanded in certain jobs. They may lack appropri- ate work habits and attitudes. And they may not have contacts with employ- ers or know how to locate suitable jobs and apply for them. Some young people may be handicapped by deficits in one or another of these areas, and others may be deficient in several or all of them. To read with understanding, to write clearly, to speak and listen effec- tively, and to perform basic mathematical computations are abilities gener- ally considered essential to adequate performance in many if not most jobs today. These same abilities are necessary to satisfactory performance in most postsecondary education programs, which young people may choose in lieu of employment or as a means to better jobs. While most would agree that the ability to interact knowledgeably with computers is an important communication or computation skill, whether it is a basic skill is open to debate. Certainly, familiarity with computers is an asset in many education- al and employment settings, but it is far from a universal requirement for either education or employment in the early 1980s. Virtually all agree that these basic skills should be taught to students in elementary and secondary schools and that a high-school diploma should signify competence in these skills (see, for example, the report of the National Commission on Excellence in Education, 1983, and the report of the Twentieth Century Fund, 1983~. For many entry-level jobs, employers require a high-school diploma or a demonstration of competence in basic skills. Some jobs inarguably require those skills; in other cases, a high- school diploma may be a proxy for other attributes that employers want, such as reliability, ability to get along with coworkers, or willingness to accept the authority of a supervisor (Corman, 19801. Regardless of the reasons for these requirements or their validity, this committee is concerned

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Youth Unemployment in a Changing Economy 19 that many young people lack the basic skills so often required in entry-level jobs. We are not alone in our concern. A report of the Task Force on Education for Economic Growth (1983) concludes that the poor quality of American education its inadequate job of preparing students for work- threatens this country's economy. Schools face immense problems in trying to keep their education programs general, vocational, or academic-current at the elementary, secondary, and postsecondary levels. In this era of rapid technological change and its similarly rapid diffusion into virtually all aspects of life, it has been argued that the skills that constitute basic competence or functional literacy change. Not only have new occupations opened up and others declined markedly, but also many jobs that have existed for decades have changed in nature. In an increasing number of jobs, employees must be able to interact with computers on at least a rudimentary level. While not everyone must be able to program a computer, knowing how to interact with them (or with those who program them) is important in an increasing number of occupations. For example, secretaries who use word processors work most effectively and efficiently if they understand at least a little about how the central processing unit of the system works and "reasons"; real proficiency with such systems involves more than the rote following of rules in a users' handbook. Parallel statements could be made about many other computer-driven systems, such as industrial robots, computerized devices for the diagnosis of automotive problems, and computers used in banking. The Center for Public Resources (1982) conducted a national survey of corporate, school, and trade union personnel to measure their perceptions of the competencies in basic skills needed by employees. The areas of compe- tence listed in the survey included reading, writing, speaking and listening, mathematics, science, and reasoning. In general, corporate personnel iden- tified deficiencies among employees in most job categories listed in the survey, while school personnel believed that their graduates were adequate- ly prepared for employment in terms of basic skills. Corporate and union personnel reported a serious problem regarding mathematics, science, and speaking and listening skills, which the educators did not perceive. Most business and union respondents noted that basic skill deficiencies limit the possibilities of job advancement for employees. Most companies repre- sented in the survey had not estimated the business costs of these deficien- cies in their employees but believed them to be high. The fact that employers think that schools have the responsibility for teaching basic skills has been documented in a survey sponsored by the Conference Board (Lusterman, 1977~. While employers may be reluctant to teach their employees basic skills that is, to provide education that they

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20 EDUCATION FOR TOMORROW'S JOBS believe ought to be provided by the public schools-some do so. (Luster- man reports that about 8 percent of the 610 companies with 500 or more employees surveyed provide education in basic skills.) The American Society for Training and Development has estimated that employers spend about $40 billion a year on education and training pro- grams for employees; the figure includes fees for instructors, administrative costs, equipment costs, and employee travel expenses. The Center for Public Resources (1982) recommended collaboration between educators and employers to improve the basic skills of students. Such collaboration would complement collaborative ventures focusing on vocational educa- tion. Some employers are increasingly reluctant to hire people directly out of high school and with no work experience. These employers believe they have no assurance that young people are responsible and reliable until they have a sound employment record. They feel that, while some teenagers have acquired these qualities at home or in school, many have not, and a high-school diploma offers no reasonable assurance that its holder will possess basic attitudes essential to good work habits. Supervised work experience during the school years appears to offer students an escape from this Catch-22 situation. Clearly, high-school dropouts or other people with inadequate grounding in basic skills are handicapped with especially serious problems in seeking education and training for employment. A few programs the Job Corps and the Youth Incentive Entitlement Pilot Projects, for example have been aimed specifically at these groups and are discussed in Chapter 2. The Job Corps is a federally funded program for disadvantaged young people who are not employed. As a group, participants tend to have relatively low levels of education and employment, to be dependent on public welfare relatively often, and to have relatively high rates of arrest or conviction. In addition to vocational training, a fundamental component of the Job Corps program is remediation in basic education. Most participants in the program leave their homes to live in residential centers in order to remove the negative influences of their current environments. In addition to education the participants are offered a comprehensive set of services, including health care, health education, and counseling. Participants are encouraged to work toward a general educational development (GED) certificate, which is recognized by state educational agencies as equivalent to a high- school diploma. Many analysts credit the success of the program to educa- tion and training in a supportive environment. While some may think such a comprehensive program expensive, analyses have shown that the benefits of the program far exceed the costs under a wide range of assumptions and estimates (Mallar et al., 19801.

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Youth Unemployment in a Changing Economy 21 In the past, work experience programs for people with a history of employment difficulties have not had a strong training component. Many of the programs funded under the Comprehensive Employment and Training Act (CETA) fit that description. Now, in part because of the success of the Job Corps, it is generally believed that training is an essential component of such programs. Most programs today, including those outlined in the Job Training Partnership Act the successor to CETA-combine training and work experience in their attempts to increase the employability of their participants. As effective as the Jobs Corps, the Youth Incentive Entitlement Pilot Projects, or similar programs may be, however, it is important to emphasize that they are means of providing a second chance for people who were not successful in the regular system of public education. Most would agree that spending money on a second-chance program is better than leaving people to be dependent on welfare or to engage in criminal activities. The existence of successful remediation programs, however, does not decrease the im- portance of the public schools as the principal institutions to provide education and training. CONCLUSION The fact that approximately 3 million Americans between the ages of 16 and 21 were out of work in 1982 is a matter of grave concern. The lack of appropriate habits, attitudes, and requisite skills both basic and job- related-contributes to the problem of securing jobs for both young and displaced workers. Public schools across the country can help in solving the problem, but only if they offer strong grounding for all students in basic skills and up-to-date occupational skills. All students, whether they plan to work immediately after high-school graduation or not, should be prepared to reenroll in education or training programs as necessary throughout their lives in order to update their job skills. Structural changes in the economy, especially those changes brought about by technological innovation, make the task of the schools harder, but a close link between schools and private-sector employers can help educational programs stay current.