Much of America’s production has halted, unemployment queues are growing and many businesses are terminal. Thanks to the COVID-19 crisis, our country is hemorrhaging on many fronts, from output to revenue and wages. It’s a new world order.
Unemployment insurance and business loans are necessary, but in the bigger picture, they’re palliative care. They have no effect on shrinking production of goods and services. For businesses and workers who can’t work remotely, it looks like flatlining territory — or is it?
The remedy, despite the crisis, is that now is an ideal time to invest in skills. America has a serious skills shortage due to insufficient worker training over many years, and there’s a severe mismatch between what workers can do and the job descriptions companies are offering. There aren’t enough qualified workers for job vacancies in occupations like information technology (IT), advanced manufacturing, logistics and parts of health care.
At the heart of the problem is many workers have poor literacy and numeracy levels, as the latest data shows, which is a significant hurdle to their ability to be productive and earn a decent wage. For instance, more than a quarter of jobless people can’t use common decimals and fractions well enough to perform calculations. In addition, more than seven in 10 service sector workers have low numeracy skills — in a sector experiencing harrowing job losses.
The current shutdown is an opportunity to lift literacy and numeracy skills by encouraging workers to take part in continuous learning, benefitting them and the country in the medium to long term. To do so, the U.S. government could spend some of its new economic stimulus funds on such a program. Effectively, it would boost human capital to make workers more productive.
What are the priority skills this country needs to subsidize, and how can America ensure the greenback investment will improve skills and competencies?
This upskilling initiative could happen in a number of ways. The first is a pledge to support training in basic math, reading and language. This funding would take the form of incentive payments to workers who are on unemployment insurance or unemployment assistance to use to enhance their skills. The investment would also support access to the eLearning tools, educational videos and mentoring needed.
These worker incentives would be performance-based and aimed at replacing a more significant portion of lost earnings than the 50% level unemployment insurance (UI) often provides. State agencies that administer UI would ask recipients to take part in a math, reading, digital skills or language learning program. The incentive? Workers would receive a 30% to 35% bonus on top of their weekly payments, which would be paid every two weeks or every month as long as they demonstrate active participation and progress.
State and/or local education providers would also receive federal funding to kick-start online programs to improve reading and math skills. These programs might pivot off existing free online resources and learning videos. Meanwhile, well-educated unemployed people could be trained as mentors under a similar bonus incentive program.
Another option is to fund virtual apprenticeships and other in-demand occupational skills. Businesses are continuing to hire qualified workers even in today’s shriveling economy. Think of the need for workers in many health care fields; this shortage will only grow. Virtual apprenticeships, which would attract government funding, could help, with jobless UI recipients and low-wage workers filling the roles. Government funding would support intermediaries and/or employer sponsors to set up online learning programs.
Virtual apprenticeships have proven their worth in medical coding, medical transcription, pharmacy technician, cyber technician, software development, insurance sales brokers and many other occupations. Competency-based occupational frameworks could guide program design, and they already exist for several of these fields. They’re also useful to assess whether (and to what extent) participants develop the right skills.
A current urgent need is to train health care workers to operate and monitor ventilators. Meeting this need would help hospitals improve their capacity to care for infected and ill patients, but hospitals couldn’t do that supervision and training now. Ideally, other health facilities would gain funding to train apprentices.
Consider, too, that employers keen to commit to rehiring workers post-crisis would receive help for supporting unemployed workers in learning digital and maintenance skills. That support would skyrocket their value in advanced manufacturing as well as other industries.
No one can be sure how America will recover after the danger of COVID-19 passes, but we do know that skills in numeracy, literacy, manufacturing and health care will always be valued and needed. These two initiatives would pivot off existing approaches to create a way forward.