The United States is in the midst of its most open-ended debate about economic policy since the 1970s. In this debate, the Biden administration is making the case for investing in “human infrastructure.” One part of human infrastructure that should command bipartisan and business support is investment in learning the skills people use on the job.
The case for investing in skills infrastructure mirrors that for investing in bridges, railways, and broadband — it is a foundation for a strong economy.
Like America’s roads, America’s job-related learning infrastructure is full of potholes. The reasons are well known.
Most American companies invest little in training, retaining and developing frontline workers. Exceptions exist in every industry — think of Trader Joe’s and Costco in high turnover retail.
But the widespread nurturing of most workers within company-specific careers in the post-WWII economy vanished decades ago. As a share of GDP, the U.S. invests a quarter what other advanced countries do in workforce training and retraining, and less than half what we invested in 2000.
Without government help, few low-wage and jobless workers can afford to invest in their own future. Many cycle through poorly paid positions without moving up, workers, consumers, and employers all suffering as a consequence.
Government invests substantially in education, including federal Pell grants for college. But most education and public workforce training is disconnected from the world of work. Education and training programs too often leave graduates to find their own job, earning the label “train and pray.” Again, companies and individuals lose.
Despite the potholes, three innovations in recent decades suggest what a flexible, uniquely American learning infrastructure might look like — avoiding rigid, class-based sorting in high school but with universal support for job-related learning and career guidance.
Sector partnerships — an innovation the Philadelphia Jobs Initiative helped spark in the 1990s — bring employers in manufacturing, health care, and other industries together to address their workforce needs. This helps educators and trainers customize curricula to industry requirements and gives them a partner for organizing work-based learning and summer jobs programs. Experienced workers, new employees, and businesses all benefit.
Another secret sauce of sector partnerships — the diffusion of better organizational practices as managers learn from respected peers. In healthcare partnerships, for example, managers learned, as much as 25 years ago, that not all nursing homes have high workforce turnover.
Apprenticeship has recaptured attention as a powerful learning model. It is tightly connected to good jobs in some manufacturing firms and unionized construction. And in states such as Pennsylvania, pre-apprenticeship increasingly provides access to apprenticeship for school students and residents of low-income neighborhoods.
Growing numbers of career pathways and career navigation programs provide work experience — e.g., job shadowing, summer jobs, paid internships and/or co-ops — blended with personalized advising to help individuals navigate education and labor market options. One example: a federally funded career navigation system for secondary students established by the Council for Adult and Experiential Learning (CAEL).
To scale these innovations into a support system that smooths the road to advancement for tens of millions, Congress should finance a national work-based learning infrastructure in this year’s infrastructure package.
The funding approach: co-investment through contributions, and joint governance, from businesses, workers and unions, and government — e.g., a training tax equal to 2% of payroll, half paid by companies and half by workers. Flexible training funds in several states, paid for with payroll taxes, point in this direction. But they need expanding into Workforce Trust Funds through a federal-state partnership like that which launched unemployment insurance.
Policies should aim for functionality and stakeholder buy-in.
● Firms could keep their contributions — if they use them to train their current and future workers.
● Government could make contributions for low-wage workers; and encourage pooling of contributions into industry and occupational partnerships with regional span.
● Unions could jointly govern training at unionized employers and compete to deliver learning services to non-union employees, creating a new cadre of “learning representatives.”
● Individual workers — entry-level, low-wage and dislocated — would have access to navigational guides that help them evaluate educational and job options. They would no longer be “on their own” as they seek a first, new, or better job.
Many middle- and low-wage U.S. workers today are treated as disposable. A robust learning and career infrastructure would help us pivot to honoring workers as “our most important asset.” It would also teach more employers what the best ones already know: respected and supported employees are great workers.