New Report from Boston Fed: We have a middle-skill gap, and we need to tackle it with public policy

Last week, the New England Public Policy Center at the Federal Reserve Bank of Boston released a report that examined labor supply and demand in New England.  “Mismatch in the Labor Market: Measuring the Supply of and Demand for Skilled Labor in New England,” which examined population trends as well as educational, economic and workforce data, concluded that middle-skill jobs make up a significant proportion of jobs in the entire New England region (33%) and that these jobs are likely to comprise a similar share of the economy for the foreseeable future.

The report also posited that given current trends in credential/degree completion rates in New England, coming retirements, immigration patterns and other factors, the supply of middle-skill workers will likely fall short of demand by 4-6 percent (compared with 1-2 percent in the U.S.).  In fact, one of the most sobering statistics from the report was that the current rate of college continuation among entering student cohorts would have to increase by 50 percent across all racial and ethnic groups immediately in order to meet this projected middle-skill gap.

What are the implications of this challenge?

As the report itself continues, such a large, immediate gain is not realistic, but if we were to increase the college continuation rates of entering and existing cohorts of students (including those up to age 39) by 20 percent, we could close our middle-skill gap by one-third to one-half over the next decade.

In other words, there’s an obvious solution–growing our own talent pipeline–but this requires long-term commitment, patience, creativity and hard work.  It requires looking at both new entrants to higher education and the labor force as well as those who are already enrolled/employed and helping both groups start and complete college-level work, particularly middle-skill certificates and credentials.

The Skills2Compete MA campaign has issued a number of recommendations aimed at moving us closer to this solution, including better pathways from adult basic education programs to post-secondary education; increased financial aid for part-time students; more flexible course delivery formats/methods/times; more student support services;  re-structuring developmental/remedial education; and more investment in our state’s public higher education system, especially community colleges, with commensurate increases in accountability and outcomes.

Many of our recommendations were echoed by the New England Policy Center, which also emphasized the role of community colleges in middle-skill training and the importance of strengthening this particular part of our middle-skill training arsenal.

So, here we are at the end of 2010.  We know there’s a middle-skills gap looming–two reports just this year have documented this well.  We know we have to do something about it, and we even have a pretty good idea of what we need to do.

Yet, the current recession, budget woes, and even just inertia threaten to keep us from moving toward a solution.  We are going to have to make tough choices–and we are going to have to ask our legislators and policymakers to take a stand not just to increase investments in middle-skill training and public higher education but also to change the way things have always been done.

Neither our Commonwealth, our businesses or our residents can afford to wait any longer.


Author: SkillWorks

SkillWorks is a nationally recognized workforce funder collaborative, launched by the Boston Foundation in 2003 to improve workforce development in Boston and across Massachusetts. SkillWorks brings together philanthropy, government, community organizations and employers to address the twin goals of: 1) Helping low-skill, low-income individuals attain family-supporting jobs; and 2) Helping employers find and retain skilled employees.

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