Edward E. Gordon Gordon Report: Will the U.S. Labor economy avoid brain death?
The Gordon Reports are based on over 30 years of research on the causes, effects, and solutions for continuing worldwide skills-jobs disconnects. For your convenience, here are the major publications that have reported on a burgeoning talent-deficit question:
- Closing the Literacy Gap in American Business, 1991 (adult reading)
- FutureWork, 1994, and Enhancing Learning in Training and Adult Education, 1998 (higher performing employer training and development programs)
- Skill Wars: Winning the Battle for Productivity and Profit, 2000 (training return-on-investment)
- The 2010 Meltdown: Solving the Impending Jobs Crisis, 2005 (impact of baby-boomer retirements on workforce skill levels 2010-2030)
- Winning the Global Talent Showdown, 2009 (skilled worker challenges in 25 nations and their solutions)
- The Talent Hunters, 2012, (China, India, and the United States vie to attract skilled workers)
- Future Jobs: Solving the Employment and Skills Crisis, 2013, 2018 (preparing solutions for skilled talent deficits)
- Job Shock, 2022 (Building a new skilled workforce in the wake of COVID-19)
These publications feature case studies of businesses and communities rising to the challenge of fixing skill deficits. Many have established Regional Talent Innovation Networks (RETAINs), not one-off partnerships but collaborative hubs focusing on systemic change. Coast to coast, under local brand names, RETAINs connects schools and businesses to educate and train students and incumbent workers for today’s jobs and careers.
The Fourth Industrial Revolution continues to raise the education and skills required to develop and use advanced technologies, with AI now the focus of attention. Yet the skill levels of too many Americans stalled out during the last decades of the 20th century. High levels of vacant jobs persist across all business sectors. Wages continue to rise as businesses seek to mine the inadequate supply of knowledge workers. We are nearing a state of collapse in such people’s current and future availability. The critical mass of educated Americans is inadequate to support and grow the U.S. economy. Why has this happened?
It begins with education
National Assessment of Educational Progress (NAEP) test scores show a steep post-COVID decline in American elementary school students’ reading and mathematics performance. In 2022, only about one-third of 4th- and 8th-grade public and private school students scored in reading at grade level or above. In mathematics, 37 percent of 4th-graders scored at grade level or above, but only 27 percent of 8th-grade students did. All the testing results showed a significant growth in students scoring well below their grade level in both mathematics and reading.
International testing also showed sharp drops in reading and mathematics results. The 2022 PISA exam of 15-year-old students in 81 OECD member countries saw mean performance fall 10 points in reading and 15 points in mathematics compared to 2018 results.
The results of the 2024 ACT exams confirm another confirmation of educational declines. American high-school seniors take this achievement test to assess readiness for college-level studies. The 2024 average ACT score was the lowest in thirty years.
This year, the Georgetown University Center on Education and the Workforce issued a report on post-secondary job requirements. It indicates that 75 percent of all jobs by 2031 will require post-secondary education: two—or four-year degrees, technical certificates, or apprenticeships.
These post-secondary options will need students to have achieved 12th-grade reading comprehension. In 2024, only 33 to 37 percent of public and private high school graduates read at this comprehension level. This is a major factor behind the sad statistic that only half of students who start a post-secondary degree complete it.
Looking to the future
Demand for more advanced IT skills will continue to grow across the job market. Higher cognitive skills, critical thinking, and creativity are essential for innovation. They all involve achieving higher reading comprehension.
Business executives report skill shortages and expect them to continue. A 2024 Experis survey of IT employers in over 40 countries found that 76 percent reported difficulty finding the skilled talent they need. The World Economic Forum predicts up to 90 million skilled job vacancies worldwide by 2030, with up to 30 million in the United States. U.S. high schools are now graduating a significant number of functionally illiterate young adults. The 21st-century reality is that the world has moved into a new era of occupational transitions and employment qualifications. What actions need to be taken to stave off the brain death of the U.S. labor force?
A 2024 McKinsey Global Institute Report, “A New Future of Work,” found that the surveyed executives expect greater skill demands by 2030. Companies are considering retraining their current workers, hiring contractors, and using them to fill these growing skills deficits.
Success with these strategies depends on widening talent pools. Due to inadequate elementary and high school preparation, too many young Americans do not have the educational foundation needed to succeed in today’s high-tech jobs and careers. Reform needs to begin at these early educational levels. Businesses need to develop career information programs in elementary schools that highlight the new jobs created by the Fourth Industrial Revolution and how to prepare for them. They also need to expand partnership programs with secondary and post-secondary educational institutions. Career academy high schools can allow local businesses to help students explore how well their interests and skills fit employment opportunities. Apprenticeship, internship, and work-study programs must be implemented in more industry sectors.
Business leaders must deploy these and other strategies prioritizing human capital development. To make this succeed, Regional Talent Innovation Networks can help business leaders collaborate with other community sectors to reinvent local and regional education-to-employment systems. RETAINs provide the framework for long-term systemic transformation that sustains talent growth that benefits individuals, businesses, and U.S. economic competitiveness.
About the Author:
Edward E. Gordon is the founder and president of Imperial Consulting Corporation in Chicago. His firm’s clients have included companies of all sizes, from small businesses to Fortune 500 corporations, U.S. government agencies, state governments, and professional/trade associations. He taught in higher education for 20 years and is the Author of numerous books and articles. More information on his background can be found at www.imperialcorp.com. As a professional speaker, he is available to provide customized presentations on contemporary workforce issues.
