Wednesday, January 8, 2014

Closing the Skills Gap

Today, nearly 11 million Americans are unemployed. Yet, at the same time, 4 million jobs sit unfilled. This is the “skills gap”—the gulf between the skills job seekers currently have and the skills employers need to fill their open positions.
Historically, the United States and much of the developed world benefited from an industrial economy that offered employment opportunities for people of all skill levels. The combination of globalization and technological advancements changed the equation. Today, employers in the United States, Europe and elsewhere have diminished demand for low-skill workers and those jobs that are available are often at low wages with limited opportunities. At the same time, demand is growing for middle-skill workers—machinists, technicians, health care practitioners and a broad range of other roles.
The job opportunities that are opening up do not necessarily require college degrees, nor do they demand an educational background beyond the reach of most job seekers. But they do require specialized skills that can only be attained through focused and effective training. The challenge is giving workers the chance to acquire the right skills for the jobs in their communities.
To achieve that goal, we must first have reliable local-level data to tell us exactly what jobs are available in which market and what specific skills are required to fill those jobs. It’s not enough to know that the country as a whole needs more machinists. Local leaders need an accurate picture of the specific jobs that are opening up in their regions and the skills employers need from their workers.
With that data in hand, we will then need the combined efforts of the public, private and non-profit sectors to give aspiring workers the training they need to meet employer demand in their community.
For its part, JPMorgan Chase & Co. recently launched a new initiative, New Skills at Work, which will launch locally in Chicago, Columbus, Dallas, Detroit, Houston, Los Angeles, Miami, New York, the San Francisco Bay Area and London – communities that are hard-hit by the skills gap. Working closely with mayors, governors, local business owners, academics and other community leaders, we will announce specific grants and partnerships within these cities in the early months of 2014.
New Skills at Work will include a major research project aimed at developing regional gap reports that analyze the specific skill gaps in some of the largest U.S. metro areas and Europe. These gap reports will then inform the allocation of $250 million in grants over five years to support non-profits like Jobs for the Future that have a track record of designing successful skill-development programs. These grants will be distributed so that, for example, if the gap reports show the need for more skilled engineers in the Houston market, dollars can go to non-profit programs designed to help workers acquire engineering skills. This strategic approach maximizes our ability to create opportunity for local workers.
This program will extend to cities around the country, and even around the world (the skills gap is not just a U.S. problem—much of Europe and parts of Asia face similar challenges).
We will need more such initiatives in order to address this large and growing issue. Today’s globalized and technology-driven economy presents serious challenges. But it also offers opportunities and rewards skills. By strategically investing in people, training them in the skills employers in their communities are looking for, we can help drive down unemployment while building the foundation for the broadly shared prosperity we all seek.
Jamie Dimon is chairman and CEO of J.P. Morgan Chase & Co.
Marlene Seltzer is president and CEO of Jobs for the Future.

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