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October 18, 2011 Taking a Hard Look at New Yorks Workforce Fall Workforce New York Conference John Twomey, NYATEP.

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Presentation on theme: "October 18, 2011 Taking a Hard Look at New Yorks Workforce Fall Workforce New York Conference John Twomey, NYATEP."— Presentation transcript:

1 October 18, 2011 Taking a Hard Look at New Yorks Workforce Fall Workforce New York Conference John Twomey, NYATEP

2 What Well Talk About Today Changes affecting the Countrys, and the States Workforce, including a look at: Effects of the Recession Off shoring and Technological Replacement Demographic Shifts Good literacy skills and why they matter more today The huge educational payoff What our global competitors are doing that we arent doing, and, finally So What Do We Do It…..

3 The Jobs Picture in 2011 But simply employing a nations people is not enough. In a globalized, information-age economy, there is no more important economic priority than building a strong workforce. The United States faces an immediate challenge: finding employment for 7 million people still out of work from the 2008–09 recession and reviving robust job creation in the decade to come. But simply employing a nations people is not enough. In a globalized, information-age economy, there is no more important economic priority than building a strong workforce. 3 McKinsey Global Institute, June 2011

4 The jobs picture in months -60 months - Projected length of jobless recovery 7 Million -7 Million - Decline in the number of US jobs since December % -20% - Proportion of men in the population not working today, up from 7% in in in 10 - The number of Americans who move annually, down from 1 in 5 in % -23% - Drop in rate of new business creation since 2007, resulting in as many as 1.8 million fewer jobs 4 McKinsey Global Institute, June 2011

5 the challenges ahead 21 million Jobs - Needed by 2020 to return to full employment 9.3–22.5 million - Range of jobs created in low- and high-job- growth scenarios 1.5 Million - Estimated shortage of college graduates in the workforce in 2020 At the same time, nearly 6 million Americans without a high school diploma are likely to be without a job. 40% - Proportion of companies planning to hire that have had openings for 6 months 58% - Employers who say that they will hire more temporary and part-time workers 5 McKinsey Global Institute, June 2011

6 6 Dr. Paul Harrington, Center for Labor Market Studies, Drexel

7 Payroll Employment by Major Industry in the USA, December 2007 to December 2009 (in 000s) Dec-07Dec-09Absolute ChangeRelative Change Total Nonfarm137,983129,320-8, % Construction7,4875,647-1, % Manufacturing13,74011,456-2, % Durable Goods8,7026,984-1, % Nondurable Goods5,0384, % Trade, transportation, and utilities26,73124,561-2, % Wholesale Trade6,0385, % Retail Trade15,58114,348-1, % Transportation and Warehousing4,5564, % Information3,0242, % Financial Activities8,2257, % Professional and business services18,05216,482-1, % Education and health services18,55519, % Leisure and hospitality13,53812, % Other Services5,5145, % Government22,37722, % 7

8 Ratio of Experienced Unemployed to Job Vacancies, By Major Industry, U.S., Jan-11Feb-11 Total Non Farm Construction Manufacturing Transportation and Utilities Wholesale and Retail Trade Information Financial Activities Professional and Business Services Education and Health Services Leisure and Hospitality Other Services Government3.42.9

9 Unemployment Rates by Educational Level Educational Attainment 12-month period ending: June 2011May 2011June 2010 Less than High School 12.2%12.3% 11.7% HS Diploma/GED8.6%8.7%8.3% Some College/Associate Degree 7.6%7.5% 7.7% Bachelor's Degree6.1%6.2% Master's Degree or Higher 3.2% 3.7% 9 Dr. Paul Harrington, Ctr. for Labor Market Studies, Drexel U.

10 the challenges ahead ƒSix sectors illustrate the potential for job growth in this decade: health care, business services, leisure and hospitality, construction, manufacturing, and retail. 66 percent of employment to they will account for up to 85 percent of new jobs created through the end of the decade.These six account for 66 percent of employment today, and we project that they will account for up to 85 percent of new jobs created through the end of the decade. To reverse the recent pattern of slow job growth, businesses, government leaders, educational institutions, and workers themselves will need the courage to consider bold new approaches and must work together for such approaches to succeed. 10 McKinsey Global Institute, June 2011

11 the challenges ahead Our research indicates that progress on four dimensions is needed: ensuring that the workforce acquires skills needed for the jobs that will be in demand; finding ways for US workers to win share in the global economy; encouraging innovation, new business creation, and the scaling up of industries in the United States; and removing unnecessary impediments that slow business investment and job creation. 11 McKinsey Global Institute, June 2011

12 My Premise is that 1.If you dont think you have a problem you will have no urgency to correct it 2.New York wont have a skilled workforce until you both A) improve the results of our K-12 system; and B) address the quality of our working age population only fixing one part cant solve the problem This means only fixing one part cant solve the problem 3.Your competition isnt just in China and India, but in the other 49 States. 12

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14 Some statistics from Some statistics from…. 14Ed Gordon, Futurist

15 Workforce Diversity: Workforce Diversity: National Statistics White:73%65%53% (Non-Hispanic) Hispanic: 11%16%24% Black:12%13%14% Asians: 5%7.3%11% 15

16 New Yorks demographic shift much faster than the overall United States New York State White (non- Hispanic) 76%64%56% All Minorities 24%36%44% African Americans 12%15% Hispanics/ Latinos 9%15%20% Asian Americans 0.2%5%10% Source: Census 16

17 Could You Find a Better Use for this Money?? spent providing remedial educationNational estimate is that $1.4 Billion is spent providing remedial education to college students potential revenue lostThe estimate as to potential revenue lost to U.S. economy, according to Alliance for Excelled t Education is $2.3 Billion In Business wed set an goal of eliminating this rework 17

18 Young People Are Not Getting Work Experience Labor force participation rate U.S. is 25% this year Lowest since 1948 when they started tracking it We are sending a whole generation of high school and college graduates into the workplace without any work experience or understanding of what a J-O-B requiresWe are sending a whole generation of high school and college graduates into the workplace without any work experience or understanding of what a J-O-B requires WSJ 8/2/11Unemployment Rate people under 25 yrs old (WSJ 8/2/11) –Spain45.7% –Greece38.5% –Italy27.8% –Ireland26.9% –Portugal26.8% –Euro Zone20.3% –Germany 9.1% 18

19 Can We Really Increase the Quality of the Labor Force by Just Improving the K-12 System?? magic wand everyIf I had a magic wand today, and as of this year every High school graduate in New York was world class it wouldnt make a difference for many, many years: 2010 workforce is still 88% of 2015 workforce 2010 workforce is still 77% of 2020 workforce 65% of the 2010 workforce will still be working in 2025, were already working adults long past the reach of the traditional high school-to-college pipeline. So making K-12 graduates world class is essential but without also addressing working adults we cannot succeed 19National Skills Coalition

20 When It All Changed Employment Gains by Education: National Statistics Employment Policy Foundation tabulation of BLS Statistics

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22 Travels with John 2005 The airport The car rental counter The toll booth The hotel The gas station Kinkos Penn Station Three days, millions of jobs lost to technological replacement. So what does this mean for workforce development in the Upper Peninsula and across Michigan?

23 Earnings Gain HSDO to GED/HSD

24 Earnings Gains HSD to Associates

25 Working Age Adults HSDO

26 Adults Aged 25 – 64 HSG only

27 Job Openings by Skill Level

28 So, high unemployment but millions of unfilled jobs At the height of the recession in 2009, –2 Million unfilled jobs in the United States –2.5 Million unfilled jobs in the European Union –Today, 3.2 Million unfilled jobs in the U.S. Skills Mismatches? Immigration policy post Emerging Middle Class Asia and India ? 28

29 Reach Higher America 2008 Language Challenge Credential Challenge Literacy Numeracy Challenge Post-Sec Education Challenge Total Number of U.S. Adults (18 – 64) 6,466,383 23,247,930 34,288,383 23,997,303 88,000,000 Percent of Total U.S. Adults (18 – 64) 153 Million 4.7% 17.0% 20.1% 15.7% 57.5% 29

30 National Assessment of Adult Literacy Skills 14% of United States working age people are in NAALS Level 1 status NAALS Level 1 – cant balance a checkbook, either totally illiterate or maybe can read a sentence. 52 counties in Michigan have over 10% of their workforce in NAALS Level 1 ! New York NAALS Level 1 statewide percentage is 22% USA overall Level 1 = 14% New York ranks 49 th of 50 states (Vt= 7%, Mass = 10%, CT = 9%, NJ = 17%, and Penn = 13%) Here is the NAALS Level % information by county: 30

31 Challenges From 1963 to 2005 enrollment at two-year colleges has increased over 600 percent, eclipsing the increase in four-year enrollment which was only 200 percent, (BUT)….. Completion- Six years after students began their postsecondary education, 62 percent of adult employees who studyworking learners who put their work before their studies, or in economic parlance have a high labor market had not completed a degree or certificate and were no longer enrolled, while 37 percent had achieved a degree or certificate. WHY?? Many have rusty basic skills and struggle academically. They work in low-paying jobs and lack resources to invest in education. They lack good information about labor market opportunities and become frustrated at what their education is getting them. Working Learners, From Working Learners, Louis Soares, CAP 2009

32 GEDs awarded per 1,000

33 Enrollment in ABE per 1,000 dropouts

34 Part Time Affordability

35 How we Doing vs. Global Competitors ? Since 2000 we continue to sink toward the bottom in the PISA performance (Problem solving 15 year olds math & science) 1970s U.S number 1 in postsecondary completion US still number 3 in postsecondary completion, but For our 25 to 34 year olds, by –2005 we sank to 9 th in the world postsecondary completion –By 2009, we had fallen to 12 th –In Septembers OECD report, our 25 to 34 year olds have now fallen to 15 th among developed and emerging nations In only Germany and the U.S. are young people less educated than their parents 35

36 Immigrants? The U.S.A. does have a larger percentage of immigrants and children of immigrants than most OECD countries 36 Source: OECD, PISA 2006 Results, table 4.2c,

37 But U.S. ranks 21 st out of 30 OECD countries when only taking into account native student* scores PISA 2006 Science 37 *Students born in the country of assessment with at least one parent born in the same country

38 State vs. State; County vs. County The Virginia Higher Education Opportunity Act of 2011 was introduced to the Virginia General Assembly on January 21. establishing 100,000 new postsecondary degrees in 20 years Making higher education more affordable and accessible for Virginia students is a top priority of our Administration. It will grow our economy, create new jobs and ensure a prosperous and dynamic Commonwealth for generations to come. - Gov. Bob McConnell CEOs for Cities Launches $1 Million Talent Dividend Competition to Boost Talent in America's Cities Prize Will Go to City with Greatest Increase in College Degrees by 2014 Thanks to CEOs for Cities, we now know that for every one percentage point increase in our college graduation rate, New Yorkers will earn an additional $17.5 billion each year. - SUNY Chancellor Nancy Zimpher 38

39 Next Steps But Albany & Washington are broke… If we wait to address these challenges, what happens? If we ignore all this, will it go away? What can we do?? 39

40 What Can We Do Paul Revere We all need to be Paul Revere on this issue. Do you think your kids know this? Your neighbors? Your State elected officials? Your Congressional Representatives? Your school board members? Education and Economic Development Successfully improve K-12……. ( P – 14 ??? ) results More Students into STEM fields Spur job creation and entrepreneurship Make broadband widely available (digital divide) Commercialize university research 40

41 What Can We Do Workforce Development and Adult Education Make a bet on high demand/ high wage sectoral jobs with career ladders More incumbent worker training More work-based learning Dont burn through lifetime PELL/ TAP on remediation Micro PELL Better link existing occupational training with Adult Basic Education 41

42 What Can We Do Workforce Development and Adult Education Invest in Summer Youth Employment Programs for poor kids Wage Insurance for displaced workers 55+ IBEST-like strategies to aid completion …. Long term Is it an investment or an expense?More $$$??? The cavalry is not coming for the next 5 years on this one…. Long term Is it an investment or an expense? Im afraid that for now, improving the quality of the NY workforce is going to depend on yourselves; Education, Higher Ed, Workforce Development; Economic Development, Economic Development and Government doing things together, better, with urgencyIm afraid that for now, improving the quality of the NY workforce is going to depend on yourselves; Education, Higher Ed, Workforce Development; Economic Development, Economic Development and Government doing things together, better, with urgency 42

43 For More Information We cant fix New Yorks Workforce without doing two things: – Improve the quality of K – 12 graduates AND – Increase the Literacy Skills & Educational Levels of our Adult workers For More Information Contact John Twomey at x2 or 43


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