The 21 st Century Jobs Market: Education and the Shrinking Middle Class

Transcription

1 Panhandle Area Educational Consortium The 21 st Century Jobs Market: Education and the Shrinking Middle Class Rick Harper, Ph.D. UWF Center for Research and Economic Opportunity July 12, 2016

2 The Economic Landscape Examine 13 counties: Escambia to Wakulla Mixture of urban and rural Economies formerly driven by defense and tourism Demographics now shifting towards Florida Shifting away from manufacturing and defense Shifting into tourism and healthcare

3 Occupation 2015 Jobs 2022 Jobs Change in Jobs (2015- % Change 2014 Median Hourly Retail Salespersons 17,912 19,505 1,593 9% $10.14 Combined Food Preparation and Serving Workers, Including 14,486 15,818 1,331 9% $8.88 Customer Service Representatives 6,908 7, % $12.41 Janitors and Cleaners, Except Maids and Housekeeping Cle 6,048 6, % $10.00 Nursing Assistants 5,037 5, % $10.94 Waiters and Waitresses 13,582 14, % $10.12 Registered Nurses 7,919 8, % $26.00 Cooks, Restaurant 5,877 6, % $10.70 Secretaries and Administrative Assistants, Except Legal, Me 8,250 8, % $13.45 Licensed Practical and Licensed Vocational Nurses 2,995 3, % $17.54 Cashiers 13,055 13, % $9.07 Maids and Housekeeping Cleaners 5,192 5, % $8.92 Elementary School Teachers, Except Special Education 4,188 4, % $21.61 Landscaping and Groundskeeping Workers 3,652 4, % $10.72 First-Line Supervisors of Office and Administrative Support W 3,912 4, % $20.49 General and Operations Managers 3,287 3, % $42.55 Tellers 2,729 3, % $12.49 First-Line Supervisors of Retail Sales Workers 5,786 6, % $16.98 Laborers and Freight, Stock, and Material Movers, Hand 4,083 4, % $10.75 First-Line Supervisors of Food Preparation and Serving Workers 3,858 4, % $14.00 Bookkeeping, Accounting, and Auditing Clerks 4,545 4, % $15.16 Plumbers, Pipefitters, and Steamfitters 1,468 1, % $15.25 Office Clerks, General 7,132 7, % $12.31 Security Guards 2,190 2, % $9.92 Roofers 864 1, % $13.99 Home Health Aides 1,560 1, % $9.58 Medical Assistants 1,791 2, % $13.11 Heating, Air Conditioning, and Refrigeration Mechanics and Installers 1,493 1, % $16.68 Teacher Assistants 3,410 3, % $10.89 Clergy 1,014 1, % $19.26

4 Occupation 2015 Jobs 2022 Jobs Change in Jobs (2015- % Change 2014 Median Hourly Military occupations 37,223 37, % $15.99 Retail Salespersons 17,912 19,505 1,593 9% $10.14 Combined Food Preparation and Serv 14,486 15,818 1,331 9% $8.88 Waiters and Waitresses 13,582 14, % $10.12 Cashiers 13,055 13, % $9.07 Secretaries and Administrative Assista 8,250 8, % $13.45 Registered Nurses 7,919 8, % $26.00 Office Clerks, General 7,132 7, % $12.31 Customer Service Representatives 6,908 7, % $12.41 Janitors and Cleaners, Except Maids a 6,048 6, % $10.00 Cooks, Restaurant 5,877 6, % $10.70 Stock Clerks and Order Fillers 5,791 5, % $10.51 First-Line Supervisors of Retail Sales W 5,786 6, % $16.98 Correctional Officers and Jailers 5,417 5, % $15.90 Maids and Housekeeping Cleaners 5,192 5, % $8.92 Nursing Assistants 5,037 5, % $10.94 Bookkeeping, Accounting, and Auditing Clerks 4,545 4, % $15.16 Maintenance and Repair Workers, General 4,308 4, % $14.76 Elementary School Teachers, Except Special Education 4,188 4, % $21.61 Business Operations Specialists, All Other 4,089 4, % $29.70 Laborers and Freight, Stock, and Material Movers, 4,083 Hand 4, % $10.75 First-Line Supervisors of Office and Administrative 3,912 Support Workers 4, % $20.49 First-Line Supervisors of Food Preparation and Serving 3,858Workers 4, % $14.00 Receptionists and Information Clerks 3,703 3, % $11.90 Construction Laborers 3,678 3, % $12.87 Landscaping and Groundskeeping Workers 3,652 4, % $10.72 Childcare Workers 3,434 3, % $8.51 Teacher Assistants 3,410 3, % $10.89 Heavy and Tractor-Trailer Truck Drivers 3,357 3, % $15.05 General and Operations Managers 3,287 3, % $42.55

5 Hospitality and Tourism Cluster Concentration, U.S. average = 1 Escambia County, FL 1.70 Santa Rosa County, FL 0.76 Okaloosa County, FL 1.99 Walton County, FL 6.87 Holmes County, FL Washington County, FL Bay County, FL After adjusting for population size, for every 100 employees in hospitality and tourism in the national economy, Walton has 687, while Liberty has 21. Jackson County, FL 0.83 Calhoun County, FL 1.49 Gulf County, FL 2.90 Liberty County, FL 0.21 Franklin County, FL 4.55 Wakulla County, FL

6 How does this fit with national trends? Deficient aggregate demand Decreasing share of national income to middle class Although average household income has increased, there is declining median household income Skills training over a lifetime is increasingly important Universities are no longer the only repository of knowledge Improving online resources challenge face to face learning

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10 The 21 st century jobs market: It s a great time to own a productive capital asset, not such a good time to sell your labor for wages, particularly if you do things that industrial robots or software could do.

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12 Share of Total Florida Employment Thousands of Jobs 18% Florida Manufacturing Employment, Jan Dec 2012, s.a % 14% % 10% 8% sector share of FL jobs US sector share thousands of FL jobs % 200 4% 2% 100 0% 0

13 Jan-87 Dec-87 Nov-88 Oct-89 Sep-90 Aug-91 Jul-92 Jun-93 May-94 Apr-95 Mar-96 Feb-97 Jan-98 Dec-98 Nov-99 Oct-00 Sep-01 Aug-02 Jul-03 Jun-04 May-05 Apr-06 Mar-07 Feb-08 Jan-09 Dec-09 Nov-10 Oct-11 Sep % U.S. Manufacturing Output and Employment, Q1/87 - Q4/12, 1987 = 100% 160% 140% 120% Employment as % of 1987 Output as % of % 80% 60% 40% Source: Federal Reserve Bank of St. Louis (FRED database)

14 Jan-90 Sep-90 May-91 Jan-92 Sep-92 May-93 Jan-94 Sep-94 May-95 Jan-96 Sep-96 May-97 Jan-98 Sep-98 May-99 Jan-00 Sep-00 May-01 Jan-02 Sep-02 May-03 Jan-04 Sep-04 May-05 Jan-06 Sep-06 May-07 Jan-08 Sep-08 May-09 Jan-10 Sep-10 May-11 Jan-12 Sep Output per Hour in Manufacturing and in All Businesses, 1/90 = 100% Output per hour in Manufacturing Output per hour in All Businesses 0

15 thousands of jobs U.S. Nonfarm Employment: Total (ex mfg) and Manufacturing, US Total Nonfarm Employment (ex mfg) US Manufacturing Nonfarm Employment Source: FRED Federal Reserve

16 Job polarization: the disappearance of employment in occupations in the middle of the skill distribution Characteristics: since the 1980s Job polarization is not a gradual process; mostly occurring during economic downturns Jobless recoveries are associated with the disappearance of middle-skill occupations (most of which involve performing routine tasks) Technology is biased against routine tasks Based on research by Nir Jamiovich and Henry Siu (2012), Goldin and Katz, Acemoglu and Autor, presentation by Mike Chriszt of the Atlanta Federal Reserve Bank.

17 Consider 4 types of jobs: Non-routine cognitive: management, finance, legal, science, engineering, healthcare practitioner tend to be high-skill occupations Non-routine manual: healthcare support, food prep, janitorial, etc. tend to be low-skill occupations Routine cognitive: sales-related, office and admin support tend to be middle-skill occupations Routine manual: production, material moving, construction tend to be middle-skill occupations As presented by Mike Chriszt, Atlanta FRB, from Jamiovich and Siu 2012

18 From Chriszt, and Jamiovich and Siu

19 Outcomes per $10mm in Sales, by Industry Restaurant Sales Nursing Home Industry Sales Pharmaceutical Manufacturing Sales Lawn & Garden Equipment Manufacturing Sales Motion Pictures & Digital Media Sales Direct Jobs Indirect Jobs Induced Jobs Average Compensation per Emplyee ($000) Source: IMPLAN Software and Data (MIG Group) Value Added per Employee ($000) Output per Employee ($000)

20 Outcomes per 100 Direct Jobs, by Industry Restaurant/Food Service: Sales = $6.1 M Nursing Homes: Sales = $5.1 M Pharmaceutical Manufacturing: Sales = $128.2 M Lawn & Garden Equipment Manufacturing: Sales = $42.2 M Motion Pictures & Digital Media: Sales = $17.1 M Indirect Jobs Induced Jobs Average Compensation per Employee ($000) Value Added per Employee ($000) Output per Employee ($000)

21 Will these changes become larger or smaller over the coming decades? The pace of technology growth is accelerating. The cost of shipping has fallen. Technology is biased against routine tasks, whether they involve cognitive skills or not. The cost to businesses of using labor is rising, especially with respect to nonwage costs (healthcare, other fringes). Businesses are increasingly able to hire specialty talent, giving rise to the gig, or the free agent economy. There is increasing divergence in the income distribution in the developed economies.

22 annual per capita personal income by county of residence Education vs. Income for all Counties in the U.S., 2012 data $140,000 $120,000 Williams, ND New York $100,000 Sully, SD y = 637.8x R² = $80,000 Alexandria Arlington $60,000 McMullen, TX Los Alamos $40,000 $20,000 $ percent of resident population (aged 25+) with bachelor's degree or higher

23 annual per capita personal income by county of residence Education vs. Income for Counties in Florida, 2012 data $70,000 $60,000 $50,000 Collier y = x R² = Okaloosa $40,000 Leon Alachua $30,000 $20,000 $10,000 $ percent of resident population (aged 25+) with bachelors degree or higher

24 What s the Bottom Line? Economic activity results from matching area resources (supply) with needs in the marketplace (demand). Improving the quality of local assets (labor, capital, natural resources, intellectual property, entrepreneurial ability) allows assets to earn a higher return in the marketplace. The high-wage, sustainable jobs of tomorrow will go to those with the skills to create and use new technologies. Routine, non-cognitive tasks will either be automated or off-shored. Safe streets and good schools are essential to healthy growth. Small and new businesses have been the net job generators, but that role has been changing over time.

25 How to Measure Your Economic Impact

26 The 2012 Statewide Study Examine FY economic impact of all SUS institutions Statewide impact of $52 bn/yr, 771,000 jobs 16.6% of impact is from operations 5.1% of impact is from student spending 78.3% of impact is from higher wages associated with obtaining degree UWF typically 2.75% of total in each category UWF responsible for $1.43 bn/yr GDP, 21,151 jobs

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35 Panhandle Area Educational Consortium The 21 st Century Jobs Market: Education and the Shrinking Middle Class Questions? Rick Harper, Ph.D. UWF Center for Research and Economic Opportunity July 12, 2016