Solving the Jobs Puzzle
Robert Lerman, an economist in AU’s College of Arts and Sciences, has written extensively on jobs issues. His research explores how employment, income support, and youth development impact low-income people. He recently shared some of his ideas on job creation with American Today.
Q: You’ve written extensively about apprenticeships, noting that in Switzerland, Germany, and Austria 50 to 70 percent of young people enter apprenticeship programs. Why would it be a good idea to expand such programs in the United States?
A: Apprenticeship, in addition to investing in people and improving their occupational skills, is also is a route by which employers upgrade jobs. They begin to realize that here are a set of skills they could demand of their workers, and they can actually end up doing more. In the long-term care industry there is an apprenticeship program that can certify people and raise their skills, potentially reducing the number of medical errors and turnover. The skills [required for] a long-term care apprenticeship program are much higher than the skills states specify [for] the amount of training workers must receive . . .
The federal government has done little in this area while other countries have been expanding the apprenticeship approach or maintaining a very high level. And those countries—especially Germany and Switzerland—have managed to maintain a high share of manufacturing employment, very low youth unemployment, and provide better options for middle-skill people.
Q: Would increasing apprenticeships here cut into university enrollments?
A: Not at four-year universities. Right now what we see in many cases is the high-value apprenticeships attract people in their mid- to late 20s, some of whom have degrees and want to learn a craft that is well paid and involves learning by doing. A lot of people do very well in that context. One of my pet phrases is that sameness is not equality. Trying to get everybody to do the same thing, go through the same four-year academic route, is not equality in the face of people who have different interests, different approaches, different ways of learning. If you force everybody into a sort of sameness, that’s not being equal.
Q: You’ve written about reinvigorating the housing sector. What is its economic impact on jobs?
A: We have a natural way of helping the most-needy. And that would be by expanding our existing housing programs for low-income families in a way that emphasizes homeownership. The idea would be to create a million to 2 million homeownership vouchers patterned after the rent voucher system. You would get a voucher [up to] the existing rent voucher threshold in [your] community or the amount it would cost to carry a home at the 25th percentile of home values. In 95 percent of areas, the current rent thresholds--which we’re already providing to low-income people through the rent voucher system--is way more than what you would [need] to carry a home on a monthly basis, valued at the 25th percentile of home prices.
Q: How would this create jobs?
A: By reinvigorating the housing market it will ultimately have an impact . . .We could [also] set some money aside for housing authorities to upgrade the houses and the energy elements of these houses. A jobs program [could be] linked to this program. The president did propose something along those lines; it’s a bit vague but I think that could be a job creator.
Q: You’re optimistic about job growth is the energy sector, especially natural gas. What’s behind that?
A: I think we should distinguish between job-creating measures that don’t cost the government money but yield government benefits through higher revenues and job creation components that have significant deficit impact. The energy area is especially ripe because every dollar produced here is a dollar that is likely to reduce imports. So it’s generating more jobs, but also more U.S. production. It’s a pretty strong win economically.
Q: Young people are especially hard hit by the current economic situation. Any cause for optimism looking forward?
A: I think there is. We’re taking a long time to get out of this recession, although in some ways we’re out of it . . . We’re growing a bit. We need to tilt more of that growth toward labor demand. When you put in expensive [programs] per job, you don’t do that. Or it’s tilted toward high-end jobs at a very high cost. Who’s left out? People who can’t get those high-end jobs: low-income youth, some other youth, and less skilled workers in general.