Skill Development Guards Against Short-Term Gains

Georgetown Center on Education and the Workforce created a report in January in response to the new administration’s proposal to invest $1 trillion in infrastructure over 10 years. “Trump’s Proposal Could Create 11 Million Jobs” analyzes the proposal and projects how this could play out in the labor market, both short and long term.

Infrastructure jobs which include transportation, energy, telecommunications and border security sectors of the economy make up 12 percent of US jobs, according to the Community College Daily from the American Association of Community Colleges. An investment of $1 trillion would create more than 11 million jobs and increase infrastructure jobs to 14 percent of all jobs, the report says.

Elaine Chao who is the former secretary of labor in George W. Bush’s administration and is secretary of transportation for President Trump has said that infrastructure would be an area of focus for her. She has talked about the need to “rebuild, refurbish and revitalize America’s infrastructure so the economy can grow and create good-paying jobs.” These jobs along with jobs created by baby boomer retirements and economic growth will create a demand for workers at all levels. Jobs directly related to infrastructure such as construction workers and tradesmen will increase as well as other middle-skill jobs such as office work, retail and healthcare services.
The Georgetown report says that:
• 55 percent of jobs would go to workers with a high school diploma
• 24 percent would go to workers with a postsecondary vocational certificate or some college but no degree
• 8 percent will go to workers with an associate’s degree
• 13 percent will go to workers with a bachelor’s or advanced degree.

Short-term labor market impact
These infrastructure jobs, along with jobs created by baby boomer retirements and economic growth, will create a demand for workers at all levels. Men will fill most of the jobs created by the infrastructure investment because of the nature of the work involved, the Georgetown report states. About one-third of the jobs will require a post-secondary degree, certificate or license. Generally that will take more than six months of training and education. The other two-thirds of the work will require six months of training or less.

The key here is that all jobs will require some amount of training. “Modern infrastructure jobs likely will have at least some on-the job or pre-employment training and skill requirements, even among those with formal college attainment,” according to the report. Community colleges and post-secondary training institutions will need to develop training programs that can quickly and effectively train workers with the skills they need for today’s jobs. As infrastructure projects develop businesses will find the need to support their workers with tuition assistance in order to have workers who can carry perform their jobs successfully.

Long-term labor market impact
The immediate need for workers to fill infrastructure workers may create a sense of urgency and economic security, but it is just part of a cycle. “Infrastructure jobs would likely boom and then decline, except for a growth in the share of workers necessary to maintain, repair, and update infrastructure,” the report analysis states. “Our historical experience, especially in manufacturing, suggests that many of the skills obtained in the boom would not be transferable to the modern high-tech service-dominated economy.” There will be jobs available and a demand for workers: Bureau of Labor Statistics projection are that the labor force will only grow .5 percent per year through 2024, compared to 1.2 percent from 1994-2004.

The problem will be whether or not the infrastructure workers will have skills that transfer to new jobs.

Higher education is the key for workers to be able to meet the needs of long-term labor market. Adults in the labor market need to move ahead as technology advances and changes the skills needed to perform a job successfully. Life-long education is going to be the norm for workers to adapt to new job requirements as labor market demands change. Business that support their employees through education and training will have employees that can meet labor challenges, even with slow growth in the labor market. Looking beyond immediate job skills is important for all stakeholders.

Georgetown CEW says, “In conclusion, it seems reasonably clear that infrastructure jobs are good jobs for those who get them and bring long-term economic and social gains for the rest of us. But we do not want this infrastructure boom to be a false dawn for American workers. The challenge we face is building an effective education and training system to prepare workers for them and an effective retraining system to provide for successful labor market transitions when the boom in infrastructure jobs is over.”