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America’s Dual Recession

  • Publication: 
    Project Syndicate
    Date: 
    August 12, 2020

    Before COVID-19 shut down entire sectors of the US economy, the US workforce was becoming increasingly polarized along educational, racial, and geographic lines. Now, those trends have been accelerating, underscoring the need for a smart, worker-focused policy response.

    BERKELEY – Americans heading into the fall and the new school year are grappling with interrelated upheavals in health, the economy, family life, and race relations. The COVID-19 crisis is falling hardest on the most vulnerable: people of color, people with disabilities, immigrants, women, the less educated, and other workers trapped in precarious, non-standard, and low-wage jobs without health insurance or benefits. Worse, the jobs susceptible to the pandemic-induced recession overlap with those that will be susceptible to accelerating digitization and automation as the economy recovers.

    Across the country, many workers are facing the impossible choice of caring for their children or showing up at their essential but low-paying jobs. And with fall school plans in flux, childcare is quickly falling back on women, threatening to set back decades of progress in closing gender pay and opportunity gaps.

    Reversing the pandemic’s economic injustices and addressing the glaring structural inequalities it has exposed will require a sustainable and inclusive recovery based on good jobs for all workers. The first priority is to roll out an immediate COVID-19 containment and recovery plan that will restore demand for labor. Even optimistic forecasts do not foresee a return to 2019 employment levels until 2022. There is every reason to expect that many of the lost jobs – perhaps as many as 40% – will never come back. In the short to medium term, the tragic paradox is that employment opportunities are both too few and pay too little.

    To be sure, upskilling 44% of the American workforce cannot happen overnight. But we already know the core characteristics of successful training programs: strong links to local employers and communities; a focus on specific sectors and occupations; screening to match applicants with target occupations; and individualized services for program completion and job success. The task is to make these programs affordable while also including wrap-around assistance like counseling and childcare.

    Many states and cities are already developing successful workforce training models. A total of 31 states participate in the Skillful State Network, and are increasing apprenticeships and skills-training programs based on local economic conditions. In San Antonio,Project QUEST helps under-skilled adults – 68% of whom are women, and 66% Latino – earn post-secondary credentials, and then connects them to well-paid job opportunities in strong sectors of the local economy (health care, manufacturing and trades, information technology). In 2018-19, program graduates increased their annual wage by 203%. And according to one recent study, participants’ wages continued to rise for nine years after finishing the program.

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