Links of note 9/14/2016

U.S. Household Income Grew 5.2 Percent in 2015, Breaking Pattern of Stagnation [New York Times]
White House trumpeting these three takeaways: (1) median household income in 2015 up 5.2 percent from the previous year — the largest single-year increase since record-keeping began in 1967; (2) about three and a half million people moved out of poverty since last year—the largest one-year drop in poverty since 1968; and (3) the uninsured rate is the lowest since they began keeping records. The Times article emphasizes those points, but notes that median household income is still 1.6 percent lower than in 2007, adjusting for inflation, and 2.4 percent lower than the peak reached during the late 1990s. The Times also notes that the income gains “came mostly from job growth rather than wage growth. More people are working, but many of them are still struggling to maintain their standard of living.”

Related articles:

Goldman Sachs Isn’t That Worried About Technology Destroying Your Job [Bloomberg]
“[W]orkers are already responding to the new employment landscape by taking on “adaptive occupations” that are better insulated from the rise of the machines. Such occupations include nurses and web developers but can also extend to more traditional vocations such as carpenters, plumbers, and tailors.”

International Literacy Day 2016

ILD 2016 Poster

ILD 2016 Poster – Click for full size

Today is the 50th anniversary of International Literacy Day (ILD), an annual observance promoted by UNESCO to “actively mobilize the international community and to promote literacy as an instrument to empower individuals, communities and societies.”

UNESCO is celebrating ILD’s 50th anniversary under the banner “Reading the Past, Writing the Future,” in recognition of the past five decades of national and “international engagement, efforts and progress made to increase literacy rates around the world.”

The main global celebration of the day takes place at UNESCO’s headquarters in Paris, in the form of a two-day conference and the awarding of UNESCO’s International Literacy Prizes for 2016. In addition, a new program, the Global Alliance for Literacy (GAL) will be launched. UNESCO calls GAL a “new and ambitious initiative to make all major stakeholders pull together to promote literacy as a foundation for lifelong learning.”

There are events, articles, and statements from government officials around the globe today to mark the occasion. ILD celebrations are generally more prominent outside of the Unites States, although many U.S. adult literacy programs mark the day as well. This UNESCO page has links to some of the more prominent ILD 2016 events.

I find that ILD provides a good opportunity to explore literacy efforts outside the U.S., and so I always take some time out on September 8 to explore ILD-related activities in other countries. If I have time today, I will post a few links.

For those of you who are fans of infographics, here is the official UNESCO ILD 2016 infographic (click on it to see the entire thing):

ILD 2016 - Link to Infographic

Unemployment Rate For Those Without a High School Diploma Ticks Higher in Latest Jobs Report

The Wall Street Journal published a helpful set of charts to go along with the BLS jobs report released last Friday. One of the charts breaks down the unemployment rate by educational background.

August Jobs Report

Not surprisingly, workers with the most education consistently have the lowest unemployment rate. What’s interesting to me about the latest BLS report is the big jump in the rate for those without a high school diploma (or equivalent): almost a full percentage point from the previous month (6.3 percent to 7.2 percent). It will be interesting to see in the months ahead whether that’s an anomaly or a growing trend.

It’s Complicated

The Wall Street Journal reported yesterday that while manufacturing has experienced some modest job growth lately, manufacturers are struggling to fill their open jobs. The story notes that the number of open manufacturing jobs has steadily risen since 2009, and that openings in manufacturing are at their highest level in 15 years.

I’m always a little suspicious, though, when anyone starts the ticker in 2009, which was when we were in the middle of one the worst recessions in history. Pretty much everything looks better if you start in 2009. It’s worth pulling the data from further back in time to get a better a better perspective on this recent growth:

Job Openings - Manufacturing, as of June 2016

Total U.S. Job Openings, Manufacturing, Dec. 2000 – Jun. 2016 (In thousands, seasonally adjusted). Source: Bureau of Labor Statistics

Here you can see that, yes, manufacturing job openings have rebounded since 2009, although they really had nowhere to go but up. In fact, they’ve climbed back to just about where they were in 2006. (We hit a high of 396,000 openings in April of that year, and there were 397,00 openings in April of this year.) So actually they are possibly at their highest levels in ten years, not fifteen.

But equally important is just how many more openings there were 15 years ago, if that’s what you count as your high-water mark (the BLS data only goes back as far as December of 2000). In January of 2001, there were an estimated 496,000 open jobs in manufacturing—100,000 more than there are today.

The second thing that I think is worth pointing out is that while job openings in manufacturing have been on the rise recently, employment in manufacturing has been on the decline for decades, and I don’t think anyone sees it coming back to where it was a few decades ago. Here’s another chart from the BLS showing the number of people employed in the manufacturing sectors since 1979:

Manufacturing Employment Trends

All Employees, Manufacturing, Dec. 2000 – Jun. 2016. (In thousands, seasonally adjusted). Source: Bureau of Labor Statistics

In this instance, the BLS data goes back to the 1930s, but I started at 1979 because this is the high-water mark for manufacturing employment in this country. (And remember, there were fewer people in the labor force back then, and, well, fewer people, period, so the percentage of people working in the sector was much higher than today.) But you can see that manufacturing jobs started rapidly disappearing in the 2000s, and really cratered during the Great Recession. So the sector has come back a little bit, but it’s nowhere near where it once was.

Executives told the Journal that the reason that jobs are going unfilled is because they can’t find workers with the skills to run the advanced machinery these companies have invested in. (The machinery that in many cases allowed them to lay off all of their lower-skilled workers to begin with.) But let’s say that  we did give all those lower skilled factory workers who got laid off over the last 15 years the skills employers say they need—I think it’s unlikely, looking at the chart above, that the sector is would produce enough new jobs in the foreseeable future to hire them all back again.

(Let’s table, for the purposes of this discussion, the argument as to whether, in certain cases, employers have a moral responsibility to do more than just hang up a “Help Wanted” sign and hope for the best in those communities that were hit hard when all that advanced machinery enabled them to cut a bunch of jobs. Some might argue that these employers ought to stop complaining and invest in what is needed to skill up those folks for these new openings. I’ll let you make up your own minds about that.)

It’s also worth noting—again—that there are those who study this stuff who argue that the skills gap in manufacturing  is overblown. I’m reminded also, of this paper, published a few years ago by the Federal Reserve Bank of Boston, which found that as a result of the Great Recession and the high unemployment rate that followed, employers simply got used to being able to hire workers with relatively high skills at a fairly low wage, a trend the study authors called “opportunistic upskilling.” Once the labor market tightened up again, hiring and retaining a workforce of higher-skilled people across the board was clearly going to be more challenging. They expected employers to adjust, by either lowering their skill requirements for some of these jobs or by raising wages. Those unwilling to do so would find that the average time to fill a position would grow longer. I have no idea if that is what’s going on at some of the companies highlighted in this article—but it could be!

The point of all of this is—it’s complicated. I don’t have any doubt that many manufacturing jobs require more advanced skills than they did a decade or two ago, but a reluctance by employers to raise wages, or to look at lowering the skill requirement for some jobs (and/or investing in more training on the job) may also be factors.

Why do I care about this? Well, because from a workforce training/adult education perspective, I want know with as much precision as I can what the actual employment trends are in order to figure out what the actual need for training really is, and whether there are other things we need to look at in order to get people into (or back into) a job.