Education Drives Wedge in Post-Recession Economy

Education Drives Wedge in Post-Recession Economy
 
 

America has largely recovered from the Great Recession of 2007–2010, but according to a new Georgetown University report, the vast majority of the jobs gained in that recovery—an astonishing 99 percent—went to workers with at least some college education.

“We talk about a jobs gap and those who have been left behind,” said Martin Van Der Werf, Director of Editorial and Postsecondary Policy for the University’s Center on Education and the Workforce. “But what’s behind this is an education gap.”

As recently as the 1970s, workers laid off during a recession tended to be rehired in the subsequent recovery, often in the same industry, occupation, or even the same job they had left, said the report, America’s Divided Recovery: College Haves and Have-Nots. But in the 1980s, that dynamic began to change as low- and middle-skilled office jobs in construction and manufacturing, and in administrative support, began disappearing—often for good. The Great Recession only accelerated this process.

First Fired, Last Rehired

“The least educated workers, those with a high school diploma or less, were the first fired in the recession and the last hired in the recovery,” the report said. “Conversely, those with the most years of college were the last fired in the recession and the first hired in the recovery.”

Workers with bachelor’s degrees lost 66,000 jobs in the recession, but gained these back by August 2010 and added another 4.7 million by 2016. Those with master’s degrees added 253,000 jobs in the recession, then gained another 3.8 million jobs in the recovery.

The situation was far different for workers with just a high school diploma or less. This group lost 5.6 million jobs during the recession but gained back only 80,000 jobs in the recovery. As a result, for the first time since the Center has been researching this subject, workers with a high school diploma or less (34 percent of the workforce) were outnumbered by those with a bachelor’s degree or higher (36 percent).

Two factors are largely responsible for this change, the report said.

“Since the 1980s, the shift in employment has favored professional service industries, which have relatively higher concentrations of workers with postsecondary education and training, at the expense of traditional factory jobs,” the report said.

Also, in the past 15 years the office services sector has seen a big decline in employment, as information once stored on paper, audiotapes, and video was transferred to digital formats. This reduced the need for middle-skilled office workers such as mailroom employees and data entry clerks. 

Racing Against Automation

For factory workers with less education—especially older employees and those who don’t live near job centers—the threat of automation can be traumatic.

“If I’ve got an assembly line job, I’m probably racing against time if I think I’m going to keep this job for the rest of my career.” Van Der Werf said. “And I’m probably going to lose.”

The report foresees “a continuing scouring out of low-skill jobs in favor of high-skill jobs,” with the majority of high-skilled jobs going to workers with the most education. The implication for workers with less education is clear.

“Workers with a high school diploma or less must attain postsecondary credentials if they want to compete effectively in growing high-skill career fields,” the report said. “The nation must face up to a need to train more of its workers for the growing high-skill jobs that play an increasingly central role in the post-Great Recession economy.”

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