The United States needs a skilled technical workforce to compete in the global economy and to sustain a high standard of living for its citizens. If the nation does not adequately develop and sustain this skilled workforce relative to what is needed, the consequences will be seen in lower productivity, falling revenues, and fewer job opportunities for Americans. Addressing this workforce development challenge requires understanding the scale and dynamics of the skilled technical workforce, as well as the complex and rapidly changing environments within which Americans provide and acquire skills and training for the jobs of the future.
Globalization and scientific and technological change are affecting nearly every aspect of modern life, from how people communicate with each other to how they shop, how they make things, and how and where they work. As artificial intelligence and advanced robotics become ubiquitous, substantial changes are likely in the nature and character of work as humans find new ways to work symbiotically with the machines they have created and as machines increasingly work autonomously (see, for example, Brynjolfsson and McAfee  and Frey and Osborne ). As a 2017 report by McKinsey & Company (2017, p. 3) concludes, “Individuals in the workplace will need to engage more comprehensively with machines as part of their everyday activities, and acquire new skills that will be in demand in the new automation age.” Adapting to this new world, American employers are demanding workers with greater proficiency in literacy and numeracy and strong interpersonal, technical, and problem-solving skills.
Many employers report experiencing difficulty finding skilled workers, although some employers may be using inappropriate screening criteria, such as requiring a 4-year degree for jobs that do not require this credential. At the same time, many students either are unaware of well-paying jobs available for skilled workers or shy away from training opportunities because of a lack of basic math or science skills. This reported shortage of skilled workers raises questions about the role of postsecondary credentials, the value of technical skills, and whether the U.S. education and workforce development systems are meeting the skills development challenge. It also raises questions about whether labor markets have the incentives and information to function properly.
While this report examines these challenges in depth, it also presents evidence in Chapter 6 that integrating academic education, technical training, and hands-on work experience produces better outcomes and return on investment for all students in elementary, high school, postsecondary, and continuing education. Moreover, a growing body of research on promising initiatives under way across the United States can be instructive for designing and implementing supportive policies and for allocating resources across organizations and programs.
Over the past decade, policy makers and employers have been concerned that advances in science and technology, slower population growth, and the retirement of the baby boom generation would lead to a shortage of skilled labor. These developments have important implications for the economy, society, workers, and employers.
For the economy, a skilled workforce is necessary to grow employment, output, and productivity (Lerman, 2015). If employers cannot hire workers with the right skills, they cannot produce enough of the higher-value products and services in the United States that are associated with sustained innovation and growth. Employers may then relocate or cease to operate.
For society, a skilled workforce is linked with better public and fiscal outcomes. As Figure 1-1 shows for the example of literacy skills, inequality in skills is associated with inequality in income, which creates pressure on public order and public programs. For instance, if a low-skilled workforce leads to slow economic growth and declining tax revenues, government budgets will be strained as a larger share of the population retires and draws on public programs such as Social Security and Medicare. Figure 1-1 also shows that citizens with low skill levels tend to report poorer health, lower levels of civic engagement, and less trust relative to those with higher skill levels (OECD, 2013).
For individual workers, higher skill levels are necessary to compete for increasingly skill-intensive jobs and higher wages, and are associated with a
wide range of better outcomes. A recent cross-country survey of adult skills by the Organisation for Economic Co-operation and Development (OECD) Programme for the International Assessment of Adult Competencies found that skills have a major influence on life choices and outcomes: lower-skilled workers have fewer opportunities in many areas of life and are increasingly likely to be left behind. In an innovative economy, workers must continually upgrade their skills. Those with technical skills need to determine how best to maintain their employability, pursue career advancement, and respond to unexpected changes in demand for their current skill set. Low skill levels make it more difficult for workers to attain additional education or training when structural changes require adaptation to new methods and processes (OECD, 2013).
For employers and firms, a skilled workforce is needed to adapt to rapid technological changes. Assessment, analysis, and communication of information and action are now conducted with a wide range of software applications using personal computers, smartphones, and the Internet. As employers increasingly automate tasks and incorporate artificial intelligence in standard operating
The demand for a skilled technical workforce is changing so rapidly that workers, employers, educators, policy makers, and civic organizations need to be highly flexible and forward looking. Likewise, the nation’s approach to workforce development and skills acquisition must also adapt to changing realities at the federal, state, and local levels. Although some skilled technical jobs in such occupations as production and transportation are being eliminated through automation and outsourcing, others are in high demand. These latter jobs, which require the ability to use new technologies, can be found in growing industries associated with health care, advanced manufacturing, and information technology. Many skilled technical jobs require postsecondary credentials below the 4-year degree, yet they provide competitive salaries and benefits, as well as the opportunity to advance to even better positions. With sufficient information and resources, these jobs could be filled by people with high-quality education and training provided by community colleges, career and technical education programs, apprenticeships, and a growing number of web-based educational programs.
As American policy makers work to tackle the challenges of social and economic development, then, they must consider whether they are creating the conditions that will prepare citizens for skilled technical jobs. These jobs require problem solving and a broad range of competencies in addition to occupation-specific technical competencies. Box 1-1 lists the general set of worker competencies identified by the U.S. Department of Labor.1
With the implementation of the recently reauthorized Workforce Innovation and Opportunity Act of 2014, policy makers at all levels are expected to make the U.S. workforce development system more demand-driven and accountable. Tackling these challenges requires that policy makers
- understand current trends in the level and distribution of skills in the adult working-age population;
- determine the adequacy of the supply of skilled workers to meet the changing demand for skills driven by social, technological, and economic requirements;
- ensure that individuals can develop and maintain the necessary skills and adapt positively to social and economic change; and
- create the conditions that forge strong, positive linkages between skill acquisition and social and economic outcomes.
Recognizing the challenges outlined above, the National Academies of Sciences, Engineering, and Medicine convened the Committee on the Supply Chain for Middle-Skill Jobs to examine the coverage, effectiveness, flexibility, and coordination of programs that prepare Americans for skilled technical jobs. In carrying out its charge, the committee considered such topics as gaps in coverage and fluctuations in the labor market, the current and preferred public- and private-sector roles in financing and providing employment training and skills certification, and the incentives and information resources available for individuals to improve their work skills (see Box 1-2).
During its first meeting, in February 2015, the committee highlighted 11 key areas of analytical attention and identified capable researchers to prepare detailed reviews of the existing literature and practices in these areas. Box 1-3 provides a list of the papers commissioned for this study. Collectively, these papers provide comprehensive coverage of salient definitions, labor market dynamics, pathways and pipelines, the role of community colleges, the role of employers, apprenticeship programs, federal workforce development programs, pathways to skilled technical allied health care occupations, veteran unemployment benefits and transition assistance, information resources, and competing on innovation.
In addition to commissioning this research, the committee organized a national symposium, held in June 2015, that brought together researchers, representatives from various industry sectors, policy makers, and other stakeholders involved in technical workforce education and training (NASEM, 2015). The agenda for this meeting is presented in Appendix A. During the symposium, the commissioned papers were presented by their authors and
discussed by a diverse set of experts. The papers were revised based on the discussion at the symposium and later posted on the National Academies study website.2
The committee convened a further four times in 2015 and 2016 to gather additional evidence from experts on topics including the scope and nature of applicable federal legislation, the role of state programs and policies, the value of online learning technologies, impediments to transitioning military personnel into the civilian skilled technical workforce, and the challenges facing efforts to collect data on the market for skilled technical workers. The agendas for these meetings are presented in Appendix A. These meetings were supplemented by further research on the academic and policy literature.
As the committee learned more about current workforce development issues, its thinking about the nature of the workforce development challenges evolved. This evolution, which has important implications for the committee’s findings and recommendations, included refining its definition of the workforce, and rethinking the nature of the policy problem and the feasible set of approaches to addressing related issues and challenges.
As a first step in developing its findings and recommendations, the committee refined its conception of the segment of the workforce addressed by this study and decided to refer to it as the “skilled technical” rather than “middle-skill” workforce. The committee determined that the term “middle-skill,” which has been widely used to describe skilled technical occupations, fails to capture the high value and dynamism of this segment of the U.S. workforce. Some participants in the June 2015 symposium also observed that the term “middle-skill” is perceived by some to have pejorative connotations. This view may make some students reluctant to obtain training for these jobs because of a stigma attached to “middle-skill” jobs and related educational pathways and careers.3 Industry experts at the symposium noted that such
3 According to Jeff Strohl, director of research at Georgetown University’s Center on Education and the Workforce, “Sub-baccalaureate education suffers the stigma of the vocational-technical high school. That’s where other people’s kids went. People see those programs as tracking into something that’s dead end.” In fact, he says, “It’s very clear that that perception does not hold up” (see Marcus, 2013). The impact of social perceptions on career choices is also discussed in Holzer (2015b).
negative perceptions may limit the ability to attract workers to skilled technical jobs.4
After reviewing a number of different definitions and approaches to measuring the skilled technical workforce, the committee adopted the following definition: “The occupation requires a high level of knowledge in a technical domain, and it does not require a bachelor’s degree for entry.” Using this definition of skilled technical work, Rothwell (2015) estimates that in 2014, there were 16.1 million skilled technical workers in the United States, collectively representing 11.9 percent of the total U.S. workforce.
The committee noted that some analysts use slightly different definitions of and analytical approaches to measuring the skilled technical workforce, and therefore derive different estimates of its size. Box 1-4 provides an overview of the estimation challenges, which are discussed in more detail in Chapter 2.
Rothwell (2015) reports that although skilled technical workers are found in most occupation groups, 82 percent are concentrated in the areas of installation, maintenance, and repair; health care; construction and extraction; and production (see Figure 1-2). The remaining 18 percent are employed in computer and mathematical occupations (5 percent), architecture and engineering (4 percent), and 16 other occupations in a wide range of categories (9 percent). The labor markets for each of these occupations are quite different, as discussed in more detail in Chapter 2, because they are all affected by local rather than aggregate changes in demographics, technology, and educational and economic opportunities.
More detailed analyses of the nature of skilled technical work led the committee to emphasize that a simple cutoff of education or salary levels is an inadequate basis on which to define these jobs. While skilled technical jobs are often described as requiring some postsecondary education and training but less than a 4-year college degree, Rothwell (2015) found that there is considerable variation in education and training among these workers (Holzer and Lerman, 2007). He estimated that most workers in these occupations hold some form of postsecondary certification but do not hold a 4-year degree. However, his estimates indicate that 31.9 percent of workers in skilled technical occupations have a high school diploma or less, 18.7 percent have a bachelor’s degree or higher, and about 15 percent have a 2-year degree. Relative to the average worker, the middle-wage occupations have a higher rate of bachelor’s degree attainment and a similar rate of high school diploma or lower attainment. Finally, it appears that skilled technical workers receive significantly more on-the-job training and have more work experience relative to the average worker.
4 The Manufacturing Institute has pursued the “Dream It. Do It.” campaign in an effort to “overcome the negative stigma that a career in manufacturing is a dirty, low-wage job” (see The Manufacturing Institute, 2015).
The committee’s investigation of the distributed structure and wide-ranging scale of the system for skilled technical workforce development—presented in Chapter 4—challenged assumptions that a single set of policy recommendations or reforms can address workforce development issues in the United States. As Figure 1-3 shows, the American system for skilled technical workforce development encompasses two broad components. The first is public and private academic and career and technical education and training in grades K-12, which are governed by more than 98,000 public schools in more than 18,000 public school districts, as well as more than 30,000 private schools. The second component is postsecondary skilled technical workforce development, which is equally complex. Its primary elements are degree-granting programs governed by 4,207 public and private institutions scattered across 50 states, an unknown number of certificate programs, an unknown number of certification
As Figure 1-3 shows, work/career options are similarly varied and include regular full-time employment, alternative and contingency work arrangements, self-employment, and entrepreneurship. In addition, as the reverse arrow in Figure 1-3 indicates, American workers can and do continue their education and training throughout their work lives, cycling back through postsecondary education and training to pursue alternative occupations, expand their knowledge and skills, maintain and expand their credentials, and retrain as advances in science and technology are disseminated into the workplace.
Understanding and making recommendations for improving the nation’s skilled technical workforce amid a complex and rapidly changing market is a considerable challenge. In addressing this challenge, the committee sought to take advantage of the diversity of experience across the nation and the efforts of many business leaders, educators, labor organizations, and policy makers to integrate academic education, technical training, and hands-on work experience to produce better outcomes for students, workers, businesses, and states and regions (see Box 1-5 for an example). In this regard, Chapter 6 presents
evidence that schools that combine high-quality career and technical education programs with a college preparatory curriculum are more effective in preparing students for both employment and postsecondary education (see, for example, Clark et al., 2007). A growing body of research on a variety of promising experiments under way across the United States—also described in Chapter 6—is instructive for designing and implementing supportive policies and for allocating resources across organizations and programs.
Accordingly, the committee has sought to draw attention to the importance of growing the rich set of networks among the various actors, as well as the significant challenges they face in making decisions and working cooperatively in the absence of sufficient information and trust. These challenges are cataloged in Chapter 5. For example, a lack of information on job opportunities available in their region may lead community college students to select courses that do not adequately equip them with the skills demanded by local firms. In turn, firms in a regional industry may need to determine how to share investments in worker training in ways that can also produce sufficient private returns. In other cases, prevailing rules and norms may lead to incentives that foster suboptimal outcomes. For example, some community colleges operate within state funding
formulas that support enrollment rather than course completion (Altstadt, 2012). In another example, transition assistance provided by the military to its retiring service members to help them adjust to the civilian workforce may be misapplied as a form of unemployment benefit (Payne Carter and Miller, 2015).
In addressing its task to review the “effectiveness, flexibility, and coordination among the nation’s programs,” the committee has highlighted the diversity of approaches available to students, guidance counselors, workers, business owners, manufacturers, labor leaders, school administrators, and community college teachers and others for working together to create local solutions that address their workforce challenges. To support and complement these activities, the committee calls for specific actions by Congress, federal agencies, state governments, employers, and civic organizations to improve the nation’s polycentric system of workforce development.
The committee began its work by reviewing existing efforts to standardize education and training in the United States, hearing from experts who recommended further standardization. Chapter 2 takes a closer look at the patterns and trends emerging from the current structure of the labor markets for skilled technical occupations.
A wide range of structural factors affect these trends and patterns in workforce development. They begin with child care, nutrition, and the quality of primary education, and extend to working opportunities and living conditions and the quality and quantity of postsecondary education and training. Workforce policies at the federal and state levels, which are described in Chapter 3, and the components of the workforce development system, which are described in Chapter 4, further influence the character and performance of the skilled technical workforce in significant ways. These policies and components, which are controlled and funded primarily at the local level, are in turn shaped by local social and economic structures and conditions.
A diversity of actors also is involved, including local educators, students, workers, employers, industries, associations, labor organizations, agencies of the federal government, state and local governments, and civic associations, all of which play a role in developing the nation’s skilled technical workforce. These actors operate in complex environments, and they often have slightly different and sometimes competing priorities and incentives. Many of the workforce development challenges, discussed in Chapter 5, reflect significant coordination problems within and across these diverse groups of actors. In contrast, Chapter 6 provides examples of notable local strategies and initiatives aimed at
overcoming these challenges to training skilled technical workers. Chapter 7 concludes with a summary of the committee’s findings and recommendations for policy and program design to enhance the nation’s skilled technical workforce.