Report refutes claims of 'hourglass' skilled labor market

Countering assumptions that a college education will be the only ticket to a stable economic future in Illinois, nearly one million openings in "middle-skill" job market – those that require more than a high school diploma, but less than a four-year degree – are projected for the state by 2014, according to a new study released today by experts from The Workforce Alliance (TWA) and the Skills2Compete-Illinois campaign, an affiliate of the national Skills2Compete campaign.

The influx of middle-skill job openings (including new jobs and replacement) would account for almost half of all openings between 2004 and 2014. Low- and high-skill jobs will account for 23 and 30 percent of total openings respectively. The report, which for the first time tracks jobs at the middle-skill level, dispels claims that Illinois is headed toward an "hourglass" labor market with a small number of highly-skilled jobs, and a much larger number of low-skill jobs.

In fact, middle-skill jobs will continue to represent the largest share of the state's labor market, totaling nearly half of all employment by 2014 – the same percentage they accounted for in 2006.

Many of these middle-skill positions are well-paid jobs, offering median earnings that exceed the Illinois overall 2006 median of $31,637. The average annual wage (which in 2005 exceeded $50,000) for manufacturing positions, a leading source of new middle-skill job openings for the state, is expected to increase by nearly 4 percent per year through 2010.

While the openings signal new opportunities for Illinois' workforce, the report cites the growing concern that there will not be an adequate number of skilled Illinois workers to fill these positions. Current trends show a dramatic decline in resources for middle-skill training combined with an accelerating retirement of middle-skill workers – leaving a pool of workers with inadequate skills or training to fill these jobs. In Illinois, more than half of all jobs are classified as middle skill but only 43 percent of Illinois workers likely have the credentials to fill them. That gap will widen as more workers retire and if Illinois' middle-skill educational attainment continues to decline.

"Middle-skill workers are the people our communities depend on – police officers, fire-fighters, nurses, electricians, and truck drivers. These are local, hands-on, and well-paying jobs that can help provide for families," notes Andrea Ray, of TWA, the convening organization for the national Skills2Compete campaign. "However while these jobs will continue to thrive in Illinois, there is a deepening skills gap among our current workforce. As a result we are likely to see grave shortages in critical occupations, significantly limiting our economic potential."

Marc Schulman, President of The Eli's Cheesecake Company, expressed his current concerns: "Our company continues to need mid-level, hands-on skill sets from our workers, but we face a challenge to fill these positions. As we compete in this global economy, we need to be more productive and innovative while achieving even greater quality assurances. This is a concern for not only our company but for our state's economy."

The analysis was performed by TWA using data from the Bureau of Labor Statistics, Current Population Survey, American Community Survey and state labor market data from the Illinois Department of Employment Security and Department of Commerce and Economic Opportunity. The analysis is based on the methodology developed for the national Skills2Compete report – America's Forgotten Middle-Skill Jobs – by labor economists Harry Holzer and Robert Lerman.

Illinois' Forgotten Middle-Skills Jobs assesses the current and future middle-skill employment and income patterns in the state:

·        Shortages in healthcare, manufacturing, and transportation/logistics will worsen. If current trends hold, Illinois will experience a shortage of 21,000 nurses by the year 2020. And a survey of Illinois manufacturers found than a 100 percent of employers identified a lack of technical skills as their primary hiring difficulty.

·        Middle-skill jobs expected to grow by 2014 in Illinois include carpenters with a median earning of $52,400; auto mechanics with a median earning of $34,600; and heavy truck drivers with a median earning of $38,500. The report includes a list of 30 fast-growing middle-skill jobs in Illinois.

·        Immigration trends by themselves are likely to do little to offset middle-skill attrition, as most workforce growth in the state due to in-migration will likely occur at the low-end of the skill spectrum or at the high-end of the skill spectrum (for example, engineers brought in from overseas through H-1B visas).

The report also finds that two-thirds of the people who will be in Illinois' workforce in the year 2020 were already working adults in 2005 – long past the traditional high school to college pipeline. The Skills2Campaign says this finding underscores the crucial importance of investments in training and re-training the current workforce, which consists of mostly adults, to closing the skill gap. And while the nation's overall K-12 education system also needs significant repair that alone won't solve this problem.

"The workforce of tomorrow is in the workforce of today," says Carrie Thomas of Chicago Jobs Council, lead partner in the Skills2Compete-Illinois campaign. Jenny Wittner of Women Employed, another lead partner agrees, "In order to ensure viable employment opportunities for all Illinois residents we need to take bold action. Every working Illinoisan should have access to at least two years of education or training past high school. This guarantee would provide our workers and businesses with the skills needed to compete in an increasingly competitive global marketplace."

The Skills2Compete-Illinois campaign also notes historical precedents for such an initiative at the federal level including universal high school for U.S. students in the mid-nineteenth century and the GI Bill, which boosted post-war prosperity in the 1940s. The report also looks at state-level precedents such as Michigan's "No Worker Left Behind" initiative, launched in August 2007, which promises to train up to 100,000 state residents in jobs in high demand occupations and emerging industries.

Illinois' proposed two-year postsecondary skill guarantee could come in a variety of forms such as occupational certifications, associate's degrees, apprenticeship certifications and in different settings including community colleges, community-based training organizations, and workplaces. Its ultimate goal is to leave Illinoisans with access to a vocational credential, industry certification, or one's first two years of college – fundamental tools to pursue these growing middle-skills openings.

Members of the Skills2Compete-Illinois campaign will meet in Washington, DC on Tuesday with the Illinois federal delegation at a briefing hosted by Senator Dick Durbin to review the study's findings and advocate for the two-year training plan. In the fall, the campaign will brief state policymakers on the report's findings and begin to explore ways to make Illinois a leading state in addressing the middle-skills gap.

The report is funded by The Joyce Foundation and the Woods Fund of Chicago.

View the report online at: http://www.skills2compete.org/

Skills2Compete is a non-partisan campaign to ensure the U.S. workforce has the skills needed to meet business demand, foster innovation, and grow broadly shared prosperity. The campaign's diverse and growing list of endorsers include national and local leaders from business, labor, education and training, community and civil rights groups, and the public sector. The Skills2Compete Vision: Every U.S. worker should have access to the equivalent of at least two years of education or training past high school -- leading to a vocational credential, industry certification, or one's first two years of college – to be pursued at whatever point and pace makes sense for individual workers and industries. Every person must also have the opportunity to obtain the basic skills needed to pursue such education. For more information, visit www.Skills2Compete.org and www.Skills2Compete.org/Illinois.

TWA's mission is to advocate for public policies that invest in the skills of America's workers, so they can better support their families and help American businesses better compete in today's economy. TWA is a coalition of community-based training organizations, community colleges, unions, business leaders, local officials, and leading technical assistance and research organizations from the field of workforce development. This alliance of stakeholders, who have not previously come together, ensures that our efforts are not in the self interest of a particular group, but are instead in the broader public interest of the nation. For more information, visit www.workforcealliance.org.