Can Education and Training Save Low-wage Workers in the U.S.?

Can Education and Training Save Low-wage Workers in the U.S.? Annette Bernhardt Brennan Center for Justice at NYU School of Law Featured Speaker The 15th Annual Meeting of the Society for the Advancement of Socio-Economics, Aix-en-Provence, France, June 2003

Growing inequality in the U.S.

U.S. compared to OECD

The growing low-wage trap

Central question: • In an era of increasing international flows of workers, capital, and goods, how do you design an education and training system that restores and expands opportunity? • An especially big challenge for the U.S., which has weak labor, education, and training systems, and much less of a commitment to providing public goods

The inequality of employer-provided training

The inequality of education

Rediscovering training-for-work • “Contract training” by community colleges • Attempt to make training relevant to employers, and hopefully, open access to jobs • But usually no requirements on job quality, employee retention, or advancement opportunities • And colleges have no control over who gets training • At its worst, this strategy supports growing externalization of training by employers

Rediscovering career paths • Building “career ladders” • Attempt to create structures that allow workers to escape low-wage trap • But most often done without regard to inherent structural constraints on upward mobility • In the low-wage industries that are often targeted by these programs, there are many more bad jobs than good ones

Regional training partnerships • Partnerships of employers, unions, training institutions, the public sector, and community groups • Solve industry problems that single firms can’t solve by themselves • Modernization, technology upgrading, global competitiveness • Training and retention of new workforce • Affordable health benefits • Flexibility and coordination of worker flows across firms • Solutions improve both job quality and skills of workforce

The new intermediaries Workforce Development Funders Community Employers Wisconsin Regional Based & Training Partnership Organizations Unions Certified Training Providers

Limitations of the model • Usually needs unions, and industries where quality products/services matter or where there are regulatory hooks • Less viable for inherently low-road industries, such as retail, restaurants, building services, mass-market call centers, movie theaters, etc.

Upshot: Need two-pronged approach • Shut off the low road: • (Re)create the legal structures that set the ground rules for what employers can and cannot do – i.e. wage floors, right to organize, “pay or play” health insurance, displaced worker protections • Pave the high road: • At a regional/industry level, create intermediary institutions that simultaneously address issues of productivity and workforce training • Education and training play an enabling role, but are ultimately not the key drivers

Can Education and Training Save Low-wage Workers in the U.S.?