Data Point #3: The U.S. Education Deficit and 46.8 Million New Jobs

Many business leaders and most talent management professionals know that the demographic shifts that are happening now and are projected to happen in the next several years will impact every organization’s ability to meet its business goals.  On top of demographic trends,  education trends are also going in the wrong direction.  Between 1997 and 2009 the U.S. position as a world leader in education has slipped from 4th to 11th, as an example.

According to Help Wanted: Projections of Jobs and Education Requirements through 2018, a report published by Georgetown University, the U.S. economy will create 46.8 million openings by 2018 – 13.8 million brand new jobs and 33 million “replacement” jobs,” positions vacated by workers who have retired or permanently left their occupation by 2018.

Good news for the economy and the working population of the U.S., right?  Well, maybe.

Let’s peel back just one layer of the onion and look at what these new and replacement jobs will require.  According to the Georgetown report, nearly 63% of these jobs will require workers with at least some college education.

This data projects that one-third of the new jobs will require a Bachelor’s degree or better and nearly 30% will require a two-year Associate’s degree or some college.  Only 36% will require a high school diploma or less – and that percentage of all jobs continues to decline.

Here’s the challenge for employers, according to the Georgetown report:  by 2018 the U.S. post-secondary education system will have produced 3 million fewer college graduates than required by the labor market.  And what if the economy recovers faster than expected with greater job growth and greater Baby Boomer retirements?  The delta gets even bigger.

Here’s where talent management professionals should be thinking creatively and strategically.

If the working population will not be educated enough for these 46 million new jobs, employers will have to be focused on educating them.

But how to begin?  Individual employers, groups of employers (aligned geographically or by industry) will have to have a multi-faceted approach, but the cost effective bet is starting with their existing workforce.  Organizations are going to have to educate their own workers and look to current best practice (tuition reimbursement programs, for examples) as well as innovate new approaches.

Strategic partnerships between employers and education institutions are beginning to create new education paradigms.  But that won’t be enough.  Other stakeholders will need to begin their involvement in educating the workforce:  local and regional economic development organizations, local workforce boards, state departments of labor and education, professional associations, labor unions – all will begin to partner with employers to deliver the educated talent they need.  Talent management leaders should be out in front on this issue, defining the skills outcomes required.

It’s clear that demand will outstrip supply in almost all occupational categories soon.  The sooner talent acquisition professionals and learning/development professionals in organizations begin to work together on workforce planning and tackling the education deficit, the sooner the talent pipeline will begin to be prepared for 46 million new jobs.

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12 Comments

Filed under CAEL, Education Deficit, Job Creation, Post-secondary education, Talent pipeline, Tuition Reimbursement, Uncategorized

12 responses to “Data Point #3: The U.S. Education Deficit and 46.8 Million New Jobs

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  7. Great article China. Thank you.

    My take based on DOL and Engineers Joint Council data goes something like this…

    for every 100,000 kids entering 9th grade in 2011 [Sept]
    only 68,000 will graduate from high school in 2015 [June]
    only 40,000 will enter college in 2015 [Sept]
    only 18,000 will have graduated from college with a degree by 2020
    only 800 of the 18,000 will have a degree in engineering
    only 125 of the 800 will have a mechanical engineering degree
    only 15 of the 125 will be women
    only 5 of the 15 will still work as engineers in 2025

    As sourcer your only concern might be to ask “When should I meet those 5 women?” In a zero sum game, if you choose to play, you win and everyone else loses

    As a recruiting/HR leader though it is going to be essential to devote some measure of resources to changing those conversion rates. Otherwise the center of gravity of the workforce will NOT reside in the US and the leadership in HR and Staffing will also likely reside outside North America.

    • You and I have talked about these incredible stats before. Truly frightening. Your last sentence is a real show stopper, though, and I hadn’t considered it before. Talk about time to wake up and smell the coffee!

      • You betcha. If 85% of IBM employees work outside the US, how many HR jobs are there for a US citizen with solid HR background but w/o international experience? My thinking…0. And what skills sets am I looking for in recruiting? Who will I most likely hire to manage, direct and build strategies for HR and Staffing around this menagerie of cultures? Someone isolated in North America? Not likely. #coffeebrewedandreadytopour

  8. Elizabeth Johnson

    Hi China,
    I also think that employers need to offer more flexible work arrangements so they can continue to attract older workers and to consider their ongoing training needs as well as mentoring the next generation.

  9. Hi China,

    Thanks for the post. I enjoyed that you drew a straight line from the data to clear action steps for leaders to take in order to address this issue. I’ve written similar blog posts (http://www.victoriomilian.com/2012/02/vicious-cycle-continued.html) because we need to get on top of this issue, and fast!

    One thing that should be noted is the high level of tuition debt that many college students are carrying with them. This is another piece of the workforce education/training puzzle that needs to be addressed.

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