Not since 1950 has there been a jobs decline as long and deep as
that of the current Great Recession. The bursting of the huge
global credit bubble has led to the first worldwide recession since
the Great Depression of the 1930s.
These economic conditions have shouldered much of the blame for the
job market's continuing woes. But there are also major problems
with the quality of the U.S. and global workforces. In a recent New
York Times column, Thomas Friedman asserts that a critical reason
for the continuing high unemployment is "an education breakdown on
Main Street" that has radically reduced the ability of the average
American worker to fill the higher skill demands of a new era in
the world's labor-market economy. What roles can workplace learning
and development professionals fill, today and over the next decade,
to mitigate this jobs skill crisis scenario?
A new labor market era
In the run up to this recession, companies of all sizes reported
increasing skilled talent shortages. By the fall of 2009, despite
more than 15 million jobless American workers, Manpower's President
David Arkless reported that in addition to 2.5 million help-wanted
postings at least 2 million U.S. skilled jobs had been vacant for
more than six months, and there were more than 2.3 million such
vacancies within the European Union (EU). Even in the midst of a
deep recession in the United States, much of the world suffers from
a growing shortage of talent with appropriate training and
education for a 21st century workforce. How will we cope once the
recession ends and business hiring begins in earnest?
We are in the midst of a major global talent revolution. The world
has entered one of the most remarkable watershed eras of
labor-market history (
1). This is the dawn of a "cyber-mental age" of ultra-high
technology that will innovate as many new products and services in
the next decade as in the last 50 years according to predictions of
the World Future Society (2009).
The U.S. economy is now undergoing significant structural changes.
New job growth seems likely to be concentrated around
export-production sectors, services, and such technology sectors as
aerospace, nanotech, biotech, or other areas in which the United
States has a comparative economic advantage in brainpower. The
United States must keep generating the emerging technologies of
this cyber-mental age that create a great proportion of high-wage
knowledge jobs across America's workforce.
Three paradoxes behind a talent enigma
Today's rapidly emerging job-talent crisis is being driven by three
paradoxes: a technology paradox, a people paradox, and a
1. Technology paradox. The recent ASTD whitepaper "Bridging the
Skill Gap" discussed the rapid acceleration of the labor-market
shift from low-skill to more complex knowledge jobs. Many of these
jobs are in science, technology, engineering, and
mathematics-related (STEM) occupations. The U.S. Department of
Labor predicts that by 2020, up to 74 percent of U.S. jobs will
require a liberal arts or career-prep high school education plus
some form of post-secondary career education (graduate degrees,
two- or four-year degrees, apprenticeships, or special occupational
certificates). Gone forever is the era of well-paying, low-skilled
or semi-skilled blue-collar factory or service jobs that could
provide high-school graduates, or even high-school dropouts, with a
living wage over a lifetime.
2. People paradox. Much of Europe and some Asian nations are
beginning to experience severe annual population and workforce
declines: Germany, 100,000; Italy, 100,000; Russia, 700,000; and
Japan and Korea, 50,000. In the United States, the fertility rate
remains at the replacement level, but the 79 million baby boomers,
who constitute a huge population bulge, will retire between 2010
and 2025. In addition, shifts in generational values are magnifying
this demographic change. Generations X and Y want a different
work-life balance. They and the boomers who want or need to
continue to work are demanding more flexibility. Business is only
beginning to adjust. Also, a widening skills gap has appeared
between boomers and Generations X and Y.
The space race and arms race of the 1950s and 1960s made math and
science national education priorities funded by the National
Defense Act and other government programs. Though not every boomer
became an engineer, many secured middle-level jobs, becoming what
Peter Drucker labeled "knowledge technologists." In 1969, the
United States landed on the moon, winning the space race. The
Soviet Union collapsed in the 1980s, ending the Cold War arms race.
As a result, the national emphasis on science and math education
began to languish in America's elementary and secondary schools.
Also, high school graduation rates began to fall from 84 percent
(1970) to 69 percent (2009). Overall, about 30 percent of U.S.
students don't finish high school. For the 50 largest U.S. cities,
the average graduation rate is now 52.8 percent. For the first time
in American history, the next generation is less educated than the
generation now retiring. An insufficient number of younger
Americans have a basic liberal arts background and the essential
technical knowledge needed to support the growth of our advanced
3. The globalization paradox. The United States has used two major
global talent safety valves to meet its talent requirements:
- H1-B visas to import a large number of high-skill workers from other nations.
- Foreign direct investment to build and operate facilities in high-skill or high-wage countries, such as Germany, Japan, Singapore, Korea, and Canada.
These talent safety valves are beginning to fail. Both India's and
China's economies are moving from low-skill to higher-skill
products and services. Though both countries graduate huge number
of technicians annually, McKinsey and Company studies and other
sources indicate that only 10 to 20 percent of graduates meet
world-class multi-national expectations. Both countries lack
adequate higher-education-accreditation quality standards. Rural
village schools provide a primitive education for most children.
With a shortage of qualified talent, wage inflation has begun. Both
nations have begun to call home hundreds of thousands of expatriate
engineers, scientists, medical personnel, and others to fill their
This is having an impact on visa applications to the United States.
It took only two days to close H1-B visa applications for the year
2008. For 2009 only one day was needed to fill all 66,000 slots.
But at the end of October 2009, more than 20,000 visas were still
available for 2010. India and China's days as the go-to sources of
talent are over.
As we have seen, many industrial nations are beginning to
experience severe yearly population declines and significant
shrinkage in the size of their workforces. For example, Germany at
the start of the current recession in 2008 reported that 75,000
engineering positions were vacant across the country. In many
advanced economies, students are not enrolling in STEM-related
This is the globalization paradox. As the recession ends, U.S.
businesses will find it increasingly difficult to import enough
high-skill talent or export these jobs overseas.
Global talent enigma
These are the complex components behind a global talent enigma that
threatens the U.S. and world economy over the next decade. During
the past 30 years, thousands of well-intentioned business
initiatives and local, state, or federal funded campaigns have
targeted specific talent issues. They have largely failed. Offering
more of the same will not work because we now face the failure of
outdated systems that are incapable of providing a much larger pool
of skilled talent.
The current education-to-employment was
developed during the 20th Century industrial age (Figure
2). It is largely defined by the individual education
mandates of the 50 states. These mandates are largely
ill-suited to prepare a greater proportion of our students and
adults for their roles in the emerging labor-market economy.
These systems also place artificial barriers between the world
of work and educational institutions providing career
preparation, thus complicating the access of workers to the
education updates needed either for their current jobs or for
preparation in another career area.
If this system is not updated over the next decade, business will
face the real possibility of 12 to 24 million vacant positions. As
a result, Manpower Inc. predicts that 10 to 20 percent of U.S.
businesses that cannot fill key positions will be forced to close.
The demographic, technological, and global changes that are
pressuring the quality of the labor supply can be alleviated by
creating new systems that will enlarge the population of skilled
talent. In the United States this needs to start first in local
areas, then move across entire states, and finally spread across
the whole nation. Training and development professionals are
already playing an important role in helping to forge local
business-education-community partnerships through what I call
"Gateways to the Future."
Throughout the United States and in many other nations,
community-based organizations (CBOs) and nongovernmental
organizations (NGOs) have been at work for more than a decade on
the challenge of rebuilding local education-to-employment systems
for the emerging cyber-mental age. Some of these gateways are in
Santa Ana, California; Fargo, North Dakota; Danville, Illinois;
Penang, Malaysia; Mansfield, Ohio; Raleigh, North Carolina;
Chicago; Singapore, and in many other communities as well.
These CBOs and NGOs are not-for-profit
organizations that have mobilized broad networks of
businesses, educational institutions, chambers of commerce,
unions, workforce boards, economic development organizations,
and others. They create a shared vision for making the
transition to a 21st Century talent creation system (Figure
3). Here at the grassroots level we can see the ingenuity
and can-do spirit that are key ingredients in American-style
CBOs and NGOs aim to rebuild the talent
pipelines that sustain a community's competitive businesses
while helping to attract new start-ups. Their goal is to help
create more higher-skill and higher-wage jobs for their
region. Tens of thousands of local businesses are making
significant financial investments that tie worker retraining,
K-12 career education programs, career academies, and higher
education programs together as a lifelong system of learning
Today's employers also need to put significant resources into
internal education and training programs. Performance and
productivity for a knowledge-based economy demands continuous job
skills updates that keep pace with the rapidly changing technology
in all business sectors. Yet over the past year, U.S. businesses
have reduced their talent development investments.
In this time of high unemployment and business uncertainty,
changing accounting standards to encourage more business investment
in training seems one avenue worth exploring. Businesses should be
allowed to capitalize investments in training, development,
education, and internships just as they can now capitalize
investments in plants and equipment. These changes in U.S.
accounting standards would provide an impetus to increase such
business investments now at $53 billion (2009) to more than $100
billion by 2020.
The current high unemployment rate presents as urgent a challenge
as the space race and arms race of the 1950s and 1960s. We need to
mobilize similar systemic-change efforts to prepare more students
and incumbent workers for STEM careers in growing high-tech
industries. Only if the United States develops the talent system to
staff millions of new start-up companies will we invent and develop
new products and services that will produce higher-paying jobs
across the nation.
What will a new open
education-to-employment system look like (Figure
5)? It will provide better opportunities for more people
to develop their talent for multiple careers and jobs over a
At the local level, training and development professionals will be
key players as more CBOs and NGOs are organized across America. You
are the best spokespersons on how to better educate incumbent
workers. Throughout the next decade, you will help invent these new
talent creation models. Each state will then mandate a new
education-to-employment system based on what has worked in its
Talent is the United States' most renewable resource. The real
challenge worldwide for training and development professionals is
developing your role to help recapture the hope and vision of
business needs that will accelerate the expansion of local talent
creation to fill the exciting career opportunities of a new
cyber-mental age. t+D