Publication Date: June 11, 2020
Stimulus for American Opportunity: Empowering Workers with Training for the Digital Economy
The economic crisis caused by COVID-19 is intensifying the inequality that has plagued our economy for years. Tens of millions have lost their jobs or wages, and the people hardest hit are people of color and people in low wage jobs or with low levels of formal education. This crisis will mark an historic turn from the industrial to the digital economy where education and training will be necessary for many good jobs, threatening to leave behind those without the resources and support to access these opportunities. While degree programs are enormously important, they have not worked for all. Workers also need the choice of accessible, rapid, and affordable training that helps them to obtain better jobs with higher wages throughout their careers.
The federal response has rightfully prioritized stabilizing incomes. Yet workers with a high school diploma or less lost 5.6 million jobs in the Great Recession out of 7.2 million total jobs erased. After the recession, those individuals recovered only 80,000 of those jobs lost between 2010 and 2016. To ensure that the current return to economic activity creates equal dignity for all workers, America needs major investments in training to create a system of adult learning for the digital economy. Without investments that give workers market power, millions are at risk of falling permanently behind. A bold federal commitment should address three goals.
Identify training that leads to good jobs and help people pay for it.
Many workers want to pursue additional training but cannot afford to do so and are unsure of which programs will help them achieve better paying jobs and careers. We know that certain skills will be necessary for long term success, and data exists to identify which programs have the strongest track record of improving participants earning prospects. Yet workers are not given the funding or guidance to pursue these programs.
- Create a new Opportunity Account—a new federal investment in worker training tied to jobs and wages. Workers need financial support to pay for their training. Rather than limiting funding based on the length of a program or focusing largely on in-person programs as we do now, federal and state policy makers should leverage existing wage data and incorporate employer and worker input to determine which training will lead to economic gains. Funding should be available to all unemployed and low-wage workers, and more generous funding should be available to pursue programs with the greatest impact on wages. To help everyone participate, funding should help pay for supportive services.
Expand online and employer-provided training.
While workers have many choices for training, there is a significant shortage of effective training options that meet the needs of workers in the current moment.
- Scale effective online training. Social distancing is increasing the appetite for online training options, yet many workers can’t find effective programs meet their career goals. Federal grants should expand the most effective online programs, create new programs to fill gaps, help effective in-person programs transition online, and encourage collaboration to improve outcomes in online education.
- Match employer investments in training and promote inclusive talent practices. Employer provided training preserves the connection between employer and employee and lets people maintain income while building skills. Yet the crisis threatens to reduce employers’ commitment to training. Federal funding should be available for employers and union programs to cover some of the costs of training that leads to good-paying jobs. Funding should also help employers adopt more inclusive talent practices that reduce bias in hiring and open opportunities for more workers.
Empower people with well-informed coaches.
Expanded funding for education and training is not enough. People need advice to identify careers that will help them meet their goals and choose training programs that are right for them.
- Hire and train more coaches: Increase federal funding to hire and train more career counselors in workforce centers, community colleges, community-based organizations, unions, and other trusted organizations that people turn to for guidance during times of crisis.
- Support state data infrastructure: Federal funding should accelerate efforts to identify the good jobs that are growing in each community and what is required to be successful in these jobs.
This paper discusses opportunities for federal policymakers to build a system of adult learning that ensures that the return to economic activity better positions American workers for success—particularly those most profoundly impacted by the pandemic. All comments are welcome.