California employers are looking for more college-educated workers than ever, but too few graduates are entering the state’s workforce to satisfy increasing demand, according to a study released this week by the Public Policy Institute of California.
At the same time, the numbers of workers with high school educations or less are expected to exceed demand, according to the report, titled “California’s Future Workforce: Will There Be Enough College Graduates?”
The resulting “workforce skills gap,” the study shows, could increase strain on the state’s economy in coming years, and has already driven average wages up for college-educated workers and down for less-educated workers.
Between 1990 and 2006, the share of workers with college degrees grew from 28 percent to 34 percent. The report’s projected share of college-educated workers by 2020, though, is only 31 percent.
But if the reported trend in demand continues, “the demand for college-educated workers in 2025 would be the equivalent to 41 percent of California workers,” the study says.
One reason for the growing shortage of college-educated workers is that Californians in their late 50s –a group among the most educated in the state — are approaching retirement age and dropping out of the workforce.
Another reason is that, since 2000, the rate of educated workers leaving California has surpassed that of educated workers entering the state.
The increase in “out-migration … has been driven, in part by housing costs in the state that may be temporary,” the report says.
An additional factor in the supply-demand gap is that Latinos, projected to make up 40 percent of the state’s working-age population by 2020, are also expected to have “the lowest college-education levels of any of the major racial and ethnic groups in California.”
Although levels have improved since 1990, the report projects the share of Latinos in California with bachelor’s degrees in 2020 to be only 12 percent.
The workforce gap, the report says, has and will continue to heighten economic inequality in the state.
“In 1980, a California man with a bachelor’s degree earned 39 percent more than a similar man with only a high school diploma,” it says. “By 2006, the difference was 86 percent.”
The projected difference for 2020 was not included in the report.
Not only does the surplus of less-educated residents mean a decline in wages and job opportunities for their families’ workers, but this will add more strain to the state’s social programs.
According to Michael Solt, the dean of CSULB’s College of Business Administration, the increased value of college-educated workers results from a shift of focus in the economy.
“If you look at the evolution of the U.S. economy, we’ve moved from more of a manufacturing age to an information and service age,” Solt said. “As the economy has evolved, the skills needed to be successful have also evolved.”
Solt said college graduates have an edge over less-educated workers in that they are taught the “soft” skills — like communication skills, critical thinking skills and interpersonal skills — that will be necessary to succeed in the current global economy, where employers have become less loyal to employees.
“In the past, when manufacturing jobs did not require a lot of skilled workers, it was easier for students to obtain jobs right out of high school,” Solt said.
Kathy Parsons, a communication officer for the Pacific Gateway Workforce Investment Network, which provides services for businesses and job-seekers, said that college-educated job-seekers are indeed better off.
“There are numerous studies showing someone with a college degree has fewer periods of unemployment,” Parson said. “And, if they are unemployed, it takes them less time to find another job.”
Ironically, the report comes at a time when recessionary pressures are forcing some college-educated workers out of jobs.
“We’re having people with PhDs and six-figure salaries coming in and looking for opportunities,” Parsons said.
“It’s difficult right now,” she said, but added that “there still are jobs.”
While Solt acknowledges that effects of the current recession may leave some college-educated workers jobless, he believes the trend described in the report will continue over the long term.
Closing the workforce skills gap, the report says, would take “unprecedented” increases in the number of college graduates, and that “even with significant expansions in California higher education, the college-education gap is too large to fill.”
While the report calls for more college graduates, it’s publishing follows the CSU’s decision to limit enrollment by 10,000 students systemwide.
The report advocates “improving graduation rates, reducing time to graduation, and/or expanding the public university system” as ways to reduce the gap. It also suggests that improvements in the public K-12 system and increased availability of college-preparatory courses can boost levels of success in college.
“Although rising compensation levels will reward people for making their own investments in college,” the report says, “the public system plays a major role.”
Kathy Parsons encourages students ages 14 to 24 to take advantage of the services offered through the Pacific Gateway Workforce Investment Network by visiting their youth opportunity center in Long Beach, located at 3447 Atlantic Ave., or to visit www.pacificgatewayworkforce.com.
To contact the writer send e-mails to [email protected]
gay
“out-migration … has been driven, in part by housing costs in the state that may be temporary.” What about the fact that the wealthiest people in the state cover nearly 90% of the state’s revenue? Re-adjust the tax system and you won’t force well-educated workers who want to retain the money they have earned out of the state. And, I’m sure that the “strain to the state’s social programs” is only going to make the tax problem here worse.