By Anthony P. Carnevale
HELP WANTED: COLLEGE REQUIRED. More frequently than ever, this is the message that
corporate America is sending to America's job seekers. More than two-thirds of the
jobs being created in the fastest-growing sectors of the U.S. economy -- office jobs
(including legal, sales and marketing, accounting, managerial and editorial positions),
health-care jobs, and teaching positions -- now require at least some college.
The office sector alone is having an enormous impact on the U.S. economy and the
skills it demands of its workers. The percentage of U.S. jobs in the office sector
grew to 41 percent of the nation's 133 million jobs in 1997, up from 30 percent of
all jobs in 1959. By 2006, the number of U.S. office jobs is projected to grow by
another 4.4 million.
But creating these college-educated workers will require smarter investment strategies
for the dollars we now devote to postsecondary education. The stakes are high. States
that do not push enough of their students through college are going to lose jobs,
skilled workers and tax revenue to locations that do. In an increasingly global economy,
these jobs could as easily go to workers in Tokyo as Topeka.
Many of these new jobs are in education and health care -- jobs associated with
the development and maintenance of human capital. Why? Because the new economy requires
more education, the demand for health care continues to rise (especially as the population
ages), and productivity in education and health-care jobs is not rising.
Meanwhile, the number of jobs, such as farm, factory, or behind-the-counter services
jobs, that do not require a college education is falling. Factory employment declined
from 33 percent in 1959 to 19 percent in 1997, and the number of farm jobs also continues
to decline. Low-wage services jobs, which comprise about 20 percent of all U.S. jobs,
have held steady since the 1950s and are not expected to become more plentiful over
time.
As the structure of the U.S. economy has shifted, so have its skill requirements.
The demand for specific vocational skills is giving way to a growing need for general
cognitive skills -- mathematical and verbal reasoning ability as well as a new set
of general problem-solving and interpersonal skills.
Little is known about how to develop and assess these general cognitive and behavioral
skills in students and workers, but most employers associate them with educational
attainment, especially college-level attainment. As a result, American employers
use a college degree as the standard by which to screen job applicants.
The good news is that a growing number of students will come
of age as the new century dawns. "Generation Y" (or the "baby-boom
echo" generation) will enter college between 2000 and 2015, and promises to
be bigger and more racially and culturally diverse than any generation before it
(See figure 1). The bad news, however,
is that not enough of these students will be going to college.
As a result of our past educational successes and our surging demographic changes,
by 2015 there should be an additional 500,000 Hispanic undergraduates and 200,000
African American undergraduates between the ages of 18 and 24 on our nation's campuses.
But these gains in diversity will be more apparent than real. The share of Hispanic
and African American youth now attending our nation's colleges trails their share
of all 18- to 24-year-olds by 630,000 students.
To improve access to college for students of all races, ages and income backgrounds
will require a decisive response from educators and government officials at every
level -- elementary, secondary and postsecondary, local, state and federal. Educational
approaches and financial aid programs need review to ensure that the country's rising
students are getting the skills and funding they need to enter and finish college,
and to secure their place in the new American workforce.
College Degrees: A Must for New-Job Seekers
More than ever before, American employers -- whether industries, associations, government
agencies, telecommunications firms, schools or hospitals -- are making college degrees
a prerequisite for new jobs. "Where did you go to college?" has replaced
"Did you go to college?" as the question facing applicants, because many
employers assume that applicants already have a diploma.
There are many reasons why most of the new jobs in the U.S. economy now require
a college education. In 1959, only 20 percent of workers between the ages of 30 and
59 needed at least some college; today that number is 56 percent.
There are at least four reasons why the demand for college is growing in the work
place:
First, the number of low-wage, low-skilled services jobs in the U.S. economy --
jobs that do not require any postsecondary education -- is not growing. These jobs,
which include restaurant and retail jobs, still comprise only 20 percent of all jobs
in the U.S. economy -- the same percentage as when Eisenhower was president.
Second, the lightning-speed growth of the high-technology industries -- such as
computers and fiber-optics as well as related industries, including telecommunications,
software manufacture and design, and Internet service providers -- has done two things:
It has helped shrink the number of factory jobs while increasing the skill level
necessary for those that remain.
Contrary to popular belief, this loss in factory jobs is not being fully offset
by gains in new high-technology jobs. High-tech jobs have grown from 3.4 percent
to 6.6 percent of all jobs since 1959. This is largely because, as with factory jobs,
it takes fewer people to make or repair high-technology equipment. And more education
is expected of these workers. More than 80 percent of high-tech jobs require at least
some college. As a result, the high-technology field is usually not the answer for
displaced factory or other workers -- unless they have the ways and means to go back
to school.
Third, as the baby-boomer population ages, and its children crowd the nation's
schools, demand for workers in both the health-care and education fields has grown
rapidly.
Unlike factory or high-technology jobs, teaching children or caring for patients
are tasks that are more difficult to replace with technology. Machines simply cannot
substitute for the human touch. They cannot perform surgery, or ensure that a child
truly understands how to multiply fractions. As a result, the number of health-care
jobs in the U.S. grew from 3.7 percent of all jobs in 1959 to 6.6 percent of all
jobs in 1997. Over the same period, education jobs increased from 5.6 to 8.3 percent
of all jobs.
Most of these new jobs, however, require higher education. More than one-half
of education and health-care workers are managers or professionals, positions that
require a two-year or a four-year college education. Overall, 78 percent of all education
and health-care workers have at least some college education.
Hispanic and African American workers are underrepresented among the better-paying
jobs in these fields as well. Only one in three Hispanic workers in the education
and health-care fields has a managerial or professional job that demands a college
degree. They are more likely to be orderlies and cafeteria workers than doctors,
nurses, teachers or school administrators. African Americans actually have a larger
representation than whites in the education and health-care fields but, again, are
more likely to hold lower-skilled jobs requiring less education.
A fourth reason for the increase in demand for more highly educated employees
is that office jobs demand them. And that is where most of the new jobs are.
The U.S. economy has, in large part, traded in its hard hat for a briefcase. The
country that made the assembly line famous now employs more office workers than factory
workers. Office jobs, a definition that also includes those working in the headquarters
of manufacturing companies, now number 54 million in the United States, or 41 percent
of the 133 million jobs in the American economy.
By 2006, the number of new office jobs is expected to swell by 4.4 million. In
comparison, the information technology field is only expected to add 750,000 new
jobs by then.
Office workers -- stockbrokers, accountants, managers, lawyers, editors, salespeople
and their like -- also are America's best-paid group of employees. On average, male
office workers with B.A. degrees or more earned $63,500 a year in 1997, and female
office workers with B.A. degrees or more earned an average of $39,000. (In comparison,
annual salaries in the health-care and education fields in 1997 averaged $58,600
for males, $33,800 for females.) Office workers also are well-educated: 66 percent
of office workers today have at least some college education, while 30 percent have
B.A. degrees.
Hispanics, in particular, are not getting their share of these new office jobs.
Only one in four Hispanic men and one in three Hispanic women were employed in office
work in 1997, compared to almost half of white workers and 36 percent of African
American workers.
Standards Rising for Existing Jobs
While there is a 28 percent increase in the number of jobs that have traditionally
required a college degree, the largest share of the increase in jobs with postsecondary
education requirements -- about 72 percent -- comes from higher skills required in
jobs that previously did not demand college-level education.
To put it another way, nearly three-quarters of the demand for workers with higher
education come from educational upgrading within jobs. The remaining one-quarter
is due to the shift in the distribution of occupations toward those that historically
have required higher education credentials.
...In other words, the rise in the share of managers and professionals
from 17 percent in 1959 to 29 percent in 1997 represents the shift in occupations
(See figure 2). The increase in the
share of managers with a four-year college degree from 40 percent in 1959 to 57 percent
in 1997 represents educational upgrading.
...Between 1959 and 1997, the percentage of the nation's managers and professionals
holding a bachelor's degree rose dramatically, from 41 to 63 percent. Over the same
period, the percentage of these elite jobs that were awarded to individuals with
no college education fell from 22 to 15 percent, while the percentage awarded to
high school dropouts fell from 15 to 1 percent.
Today, 34 percent of the nation's 84 million prime-age workers (those between
30 and 59 years of age) hold high-paying managerial or professional jobs paying an
average annual salary of $59,300 for men and $34,500 for women. Of these, more than
85 percent have at least some postsecondary education.
The story is the same among people who hold "good" jobs, such as crafts
workers, technicians and clericals. In 1959, 57 percent of the men and 30 percent
of the women holding these good jobs were high school dropouts. By 1997, only 11
percent of the men and five percent of the women holding these same jobs were high
school dropouts. Instead, more than half of the workers in these jobs in 1997 had
two-year degrees or some college course work. In 1959, only 14 percent of the men
and 18 percent of the women holding these jobs had two-year degrees or less.
Today, 37 percent of the nation's prime-age workers hold these good jobs, which
pay an average annual salary of $36,000 for men and $22,000 for women. Of these,
more than half have some college, more than one-third have two-year degrees, and
more than 15 percent have four-year degrees or better.
Diversity Is Increasing, But Not Fast Enough
From a diversity standpoint, there is good news. The percentage of Hispanic and African
American undergraduates in America's colleges and universities has grown, and their
participation in the economy's better jobs has grown along with it.
As all populations increase their college enrollment and graduation rates, the
opportunity gap is closing slowly. But the gap persists, especially in attainment
of B.A. degrees. In general, minority women are making more progress than minority
men, especially Hispanic men.
As a group, Hispanics are farthest behind. Between 1973 and 1997, the share of
Hispanics with some college education rose from 9.2 to 17.7 percent for men and from
7.5 percent to a dramatic 22.2 percent for women. For African Americans, by 1997,
45 percent of males and 51 percent of females had some postsecondary education.
The number of Hispanics and African Americans holding better jobs has risen, too.
From 1979 to 1997, the number of Hispanics employed in professional and managerial
jobs rose by three percent, with a higher proportion of Hispanic women (19.8 percent)
holding these jobs than men (13.3 percent). In 1997, 18 percent of African American
males and 25.2 percent of African American females held elite jobs, and 33.8 percent
of African American males and 36.6 percent of African American females held good
jobs.
But again, from a diversity perspective, there remains cause for concern. While
African American and Hispanic students are entering and staying in college in greater
numbers -- and thus landing the jobs that only a college degree can bring -- so is
the rest of the population.
...From 1973 to 1997, the number of white students with at least some college
education grew from 33.1 to 59.9 percent for men, and from 24.8 to 59.6 percent for
women. Over the same period, the number of white students awarded at least a four-year
degree rose from 19.9 to 33.2 percent for men, and from 12.8 to 30.2 percent for
women. And, on average, white students who enter college are more likely than either
Hispanic or African American students to complete a four-year degree.
...Although more good and elite jobs are being held by African American and Hispanic
workers than ever before, white workers continue to hold a larger percentage of the
nation's elite and good jobs, while African American and Hispanic workers hold substantially
greater shares of the nation's less-skilled jobs.
What Impact Would True Educational Equity Have on America's Economy?
...These trends reveal a stubborn, troubling pattern. It appears that not enough
members of Generation Y will go to college. Projections show that by 2006, the number
of low-skilled workers in the U.S. economy will outnumber low-skilled jobs.
But imagine an alternative scenario -- one in which the African American and Hispanic
communities had the same distribution of college education as the white community.
First of all, we would fill more of those college jobs that may otherwise go begging,
go to under-skilled American workers, or go to foreign workers. Second, the difference
in national wealth that would result from this infusion of human capital would be
startling. If African Americans and Hispanics had the same education as the white
majority, African Americans would add $113 billion annually in new wealth; Hispanics
would add another $118 billion to the nation's annual economic output. Together,
that is $231 billion a year, an amount equivalent to 6.8 percent of all Americans'
earnings. Moreover, assuming an average combined federal, state and local tax rate
of 35 percent, the new wealth created by this new human capital would result in more
than $80 billion in new public revenues.
Increasing human capital among the African American and Hispanic communities also
would benefit minority families substantially. Higher incomes would raise the standard
of living of minority families and increase the quality of their lives in countless
ways that cannot be measured.
College: Now More Than Ever
More than ever, college is a must. Postsecondary education has become this country's
worker training and retraining system.
And though a bumper crop of young talent is moving through the nation's elementary
and high schools, we must redouble our efforts to ensure that these students enroll
in college, and graduate. More Hispanic and African American students are entering
U.S. colleges and universities, but not enough. Many are limiting their college experience
to two-year programs or just some college instead of finishing four-year programs.
Meanwhile, the rising cost of a college degree is likely to have an impact even on
those students who plan to attend college.
Yet, without that college experience, these young people will find it difficult
to get good jobs and form stable families, and too many could spend time on the welfare
roll, not the payroll.
The nation's higher education institutions will need to handle the new wave of
18- to 24-year-old students from Generation Y while maintaining their commitment
to non-traditional students -- those who are older, have families, and may be working
or looking for work. Already, 42 percent of all college students are over the age
of 24. Among Hispanic college students, more than half are above the age of 24.
Nontraditional students rely on two-year and four-year institutions for retraining
or a second chance. For instance, more than 75,000 dislocated workers used Pell Grants,
and 48 percent of them also used college loans to restart their careers in 1990—91,
the most recent year for which these data are available. In 1996—97, 357,400 welfare
recipients and 119,400 of their dependents used Pell Grants to improve their prospects.
Some assessments suggest that 32 percent of women on welfare are ready to do postsecondary
work and, with a boost from 200 hours of basic-skills preparation, another 37 percent
would be ready.
If more is not done for the workforce of the future, the U.S. economy of the new
century may face rough waters. Keeping the U.S. workforce well-educated is critical
to filling the economy's jobs. This is crucial if America is to compete with its
overseas competitors. This, in turn, is crucial to ensuring that America's high-paying,
high-skilled jobs are filled by Americans in America. Without an educated workforce,
companies may relocate or, as they did in 1998, bring in more overseas talent.
Better skill building, more funding, greater access to a college education. An
all-hands-on-deck approach to the educational challenges of America's new century
is required. The time for it is now.
Anthony P. Carnevale is vice president for public leadership, Educational Testing
Service.
