Getting America Back To Work

Covid-19 has shaken up the country’s labor market, accelerating trends already underway before the pandemic. Social distancing and other measures taken to mitigate the crisis weakened demand for restaurants, bars, hotels, in-person shopping, airlines, and other businesses that rely on face-to-face contact. While demand for these businesses has bounced back since last spring, it remains well below its pre-pandemic level and may not fully bounce back for years, if ever.

These shifts in demand mean workers must adjust. Thankfully, private enterprise, philanthropies, and communities across the country are stepping up to create innovative solutions to help get America back to work. One example is the SkillUp coalition, which is empowering workers to get the skills they need to succeed in the post-pandemic world.

The Deeper Truths of Displacement

Since its high of nearly 15% in April 2020, the unemployment rate has fallen to 6.3%. While this is great news, it does not tell the whole story. Initial unemployment insurance claims are still coming in at nearly 800,000 per week and over 4.5 million people are receiving unemployment benefits, more than double the pre-pandemic level.

The recession has been especially hard on lower-income workers. According to economists at the New York Federal Reserve Bank, high-wage employment (>$85,000 per year, dark blue line in figure below) has already recovered and is in fact higher than it was before the recession started. Meanwhile, employment in low-wage jobs (<$30,000, light blue line) is still 14% below its pre-pandemic level and trending downward. Lower-middle and upper-middle wage employment are also still down.

There is also tremendous labor-market variation by state. Idaho and Utah had more jobs in December of 2020 than in January of 2020, while New York and Michigan both had 11% fewer jobs in December than in January. In other words, some labor markets are in worse shape than others.

Connecting the Hardest Hit to Opportunity

Getting lower- and middle-income workers back to work is the priority of the SkillUp Coalition, which uses its cutting-edge technology platform to connect workers to relevant re-skilling opportunities. It does this in part by offering dynamic career pathways that workers can follow based on where they are and where they want to go.

For example, brick-and-mortar retail has been one of the hardest hit sectors as the pandemic accelerated the shift to online shopping. As a result, many retail workers are out of work or looking to transition to a different career. SkillUp can help a retail salesperson transition to a higher-paying job as a customer service or sales representative, or perhaps to a different industry altogether where interpersonal skills are valued, like healthcare. There are similar pathways available for people with different initial skillsets and interests.

SkillUp’s platform is open to everyone, but SkillUp and its partners have also identified key barriers facing people hit hardest by the pandemic. To remove these barriers, SkillUp and a handful of partners and pioneer donors—including Stand Together and the Charles Koch Foundation*, respectively—have launched the SkillUp Together Fund, which aims to raise $30 million to help 30,000 Covid-19 displaced workers in the form of $1,000 grants that can be used for training and ancillary support.

Preparing for the Economy of Tomorrow

The demand for training programs and opportunities will continue to grow after the pandemic. Recent polling suggests many younger workers are already planning for a future of lifelong learning, perhaps because they entered the workforce during a period of rapid automation and advances in artificial intelligence. A new YouGov poll commissioned by SkillUp and the Charles Koch Foundation found that 47% of Americans between the ages of 18 and 55 believe they will need to acquire additional skills or training to remain competitive. The percentage is higher for younger generations—50% of millennials and 58% of Gen Z.

The data also reveal a demand for greater educational and training options. Four-year college degrees are often the default credential, but now people are equally as likely to identify certificates, badges, or micro-credentials as their first choice for learning new skills to help them achieve their career goals, followed by career and technical education programs.

Skill-specific training courses or modules that teach relevant skills in a timely fashion are a more affordable substitute for a bachelor’s or even an associate degree. Smaller modules also allow people to customize their skill set as needed and stack credentials to make themselves more attractive to employers. Over time, these smaller credentials can even add up to a degree.

SkillUp is helping to meet this growing demand for upskilling by disrupting the job-training landscape and helping workers gain usable skills relevant to their career goals. SkillUp’s platform also connects workers to employers, which is especially important in states with the weakest labor markets such as Michigan, New York, and California.

Learning new skills can seem overwhelming at first. There are hundreds of things to learn and numerous ways to learn them – how do you choose? While there is no one right answer, platforms like SkillUp help workers navigate existing opportunities so they can find the right fit for them. And when people learn new skills it not only helps them live more fulfilling lives, it also elevates the U.S. economy to new heights.

*The Charles Koch Foundation is a sister organization of the Charles Koch Institute, both of which are members of the Stand Together philanthropic community.