In the United States, manufacturing is finally rebounding. After taking a huge hit at the onset of the Great Recession, manufacturing grew at 4% in 2011, more than 2% points higher than the aggregate US economy. Moving in parallel with manufacturing, the demand for skilled-trade workers (ie: electricians, machinists, welders, etc.) has undergone a similar change. After falling 13% from 2007 to 2009, skilled-trade demand grew 6.2% per year from 2010 to 2012.
Amazingly, despite this rapid growth in employment, the economy would like to hire even more skilled-trade workers. Indeed, in 2012, the Wall Street Journal reported 600,000 unfilled skilled-trade jobs nationwide at a time when the US unemployment rate sat above 9%. It therefore seems logical that skilled-trade jobs could help this country fix its unemployment problem. Unfortunately, though, this shortage of skilled-trade workers doesn’t seem to be a relevant issue for US policymakers. Instead of addressing it, the skilled-trade shortage is expected to increase, and the United States is likely to miss out on an opportunity to increase income mobility and strengthen the middle class.
According to ManpowerGroup, a firm specializing in workplace and business solutions, the shortage of skilled-trade workers is expected to increase given the age distribution of America’s current skilled-trade employees. In 2012, 53% of skilled trade workers were over the age of 45, and 18.6% were between the ages of 55 and 64. In contrast, the same statistics for the aggregate US labor force are only 44% and 15.5% respectively. Furthermore, only 1.9% of skilled-trade workers are over the age of 65 (4.8% for the aggregate labor force), indicating that skilled-trade workers choose to retire earlier. When assessed together, these statistics suggest that the quantity of eligible skilled-trade workers is likely to decrease even more in the next couple of decades as current skilled-trade workers choose to retire. Doing so will likely exacerbate the labor shortage that US manufacturing is already experiencing.
To me, this shortage represents a tremendous opportunity for the United States to strengthen the middle class and increase income mobility. In, “Inequality is Not the Problem We Should Be Worrying About, ” I have previously discussed my belief that income mobility, not income inequality, should be the primary focus of US economic policy. In my mind, it is important to make higher wages accessible to more Americans, thereby strengthening the middle class and bolstering aggregate demand. I have also previously suggested in “Employment is on the Rise, but is it the Employment We Want” that higher education might not be the solution to income immobility, as there seems to be a surplus of college-educated Americans forced to work low-wage service jobs when they cannot find high-wage employment. An increase in skilled-trade training seems to be the perfect solution to both of these issues: by helping to promote skilled-trade education, I believe policymakers can help many Americans earning low wages enter the growing manufacturing industry, thereby increasing their wages and entering the middle class.
Depending on your idea of skilled-trade jobs, this proposal may come across as elitist. Thanks to the impression skilled-trades developed in the 1980’s, many people consider skilled-trade jobs to be for the uneducated. But according to the WSJ, this impression is not true. While in the 1980’s, skilled-trade jobs were “80% brawn and 20% brains,” today these same jobs are “10% brawn and 90% brains.” Skilled-trade jobs require “skill,” and accordingly skilled-trade employees are typically required to undergo rigorous technical training at 2-year vocational or technical schools. In this way, skilled-trade jobs should not be viewed as simple; working as a skilled-trader requires significant training and brainpower and adds significant value to the US economy.
Skilled-trade employment seems to be an excellent way for the United States to address income immobility. Given the huge emphasis this country places on a 4-year education, we are likely to experience an even larger shortage in skilled-trade jobs in the near future. This shortage represents an opportunity for many Americans to escape the lower class and enter the middle class. Through 2-year vocational training (which is typically much less expensive than a 4-year bachelors degree), many can develop the technical skills necessary to succeed in today’s manufacturing environment. In doing so, they can bolster their earnings, as a 2012 study by Georgetown University’s Center for Education and the Workforce identified over 1/3 of those with bachelors degrees as earning smaller salaries than those with more specialized training. Ultimately, therefore, it seems like an increased promotion of skilled-trade training is a policy that the United States should at least consider as it works to rebuild our quickly vanishing middle class.