Call it “You’re Hired!”
President Trump signed his workforce development initiative today, which centers on expanding workplace apprenticeships that allow employees to earn while they learn.
It couldn’t come at a better time. According to new Labor Department data, there are now more than six million unfilled jobs in the country, the most since the 1980s. Nearly half of small businesses report they can’t find qualified applicants for job openings.
But while businesses are desperate for labor, there are still 1.7 million Americans among the long-term unemployed, 5.2 million employed part-time for economic reasons, and tens of millions more underemployed or out of the workforce altogether.
What explains this paradox? Experts cite a growing skills mismatch, where Americans who want work do not have the necessary skills to attract employers who want workers. “The jobs are there, but the skills are not,” was the message from top CEOs to President Trump at a recent White House meeting. A greater focus on apprenticeships, which teach marketable and specific skills for available jobs, can help close this skills gap.
What’s especially exciting for apprentices is that millions of these available jobs pay roughly $50,000 a year or more, according to Labor Department estimates. These include hundreds of thousands of open jobs in middle-class fields like manufacturing, construction, and transportation as well as over one million open jobs in healthcare related fields alone. According to Labor Secretary Alexander Acosta, 90 percent of those who complete an apprenticeship program have a job waiting with an average salary of roughly $60,000.
These jobs require some training but don’t generally require a four-year college education. Given the $1.5 trillion of outstanding student loan debt and new researchsuggesting college students don’t learn much (if at all), apprenticeship programs look even more attractive in comparison for many students. They have two benefits that the traditional college model often lack: They pay, and they offer marketable skills.
What can the federal government do to encourage apprenticeships? Federal Reserve Chair Janet Yellen highlighted a model in a recent speech in Washington D.C. that praised their impact. She pointed to the success of Apprenticeship Carolina, a program in South Carolina that gives businesses a $1,000 annual tax credit for each apprenticeship. Such support at the federal level could significantly expand their use.
Apprenticeships then are a major part of the Fight for $50 – as in the fight for $50,000 a year jobs. These are the types of rewarding jobs that can provide fulfilling careers and support a family. Fighting to raise this wage ceiling for working Americans is a laudable goal that deserves bipartisan support at this time of partisan rancor.
While not officially part of the workforce development initiative, it’s also important to recognize that not all apprenticeships are formal. In fact, all entry-level jobs provide an apprenticeship for entry-level employees insofar as they teach them the skills necessary to quickly get a promotion and a raise.
While these entry-level job opportunities may not provide the technical skills such as welding, soldering and plumbing traditionally associated with apprenticeships, they do provide just as important soft-skills like punctuality, customer service, and a sense of urgency. Multiple studies suggest these soft skills allow the vast majority of entry-level employees to earn a raise within their first several months on the job.
That’s why another important component of the Fight for $50 is protecting entry-level training opportunities that have come under threat in recent years by dramatic minimum wage mandates. Raising the wage floor to the $12 to $15 level favored by activists would make millions of current job arrangements in the country illegal. The nonpartisan Congressional Budget Office estimated that there would be 500,000 job casualties at just a $10.10 federal minimum wage.
As the cost of living increases, the importance of good jobs also rises. The good news is they’re available. The better news: With a federal government that encourages a path to get them, they can transform from a mirage into reality.