Mismatch Between Education Levels and Jobs Tied to Long-Term Unemployment

Wow! Just yesterday I wrote about widespread diversity of skilled worker shortages from place to place.  And just this morning I received word of a new study released today tying varying gaps in unemployment rates from city to city to gaps in education.

An analysis of labor markets by the Brookings Institute using data on adult educational attainment, occupations, and job openings in the 100 largest metropolitan areas from January 2006 to February 2012 found that:

  • In the 100 largest metropolitan areas, 43 percent of job openings typically require at least a bachelor’s degree, but just 32 percent of adults 25 years and older have earned one.
  • Metro areas vary considerably in the level of education required by job openings posted online. (I referred to education yesterday in my post as one of the factors for the wide variation of skilled worker shortages from region to region.)
  • Education gaps explain most of the structural metropolitan unemployment rates, which poses more long-term problems for regional labor markets.
  • Educational attainment benefits metro areas by making workers more employable and firms more competitive and entrepreneurial, leading to more job openings for less educated workers.

Jonathan Rothwell, a Brookings researcher who worked on the study, said metropolitan areas with the highest education levels were doing better than those with lower educational levels before the recession, “and they’re doing much better during the recovery.”

For sure, there are fewer job openings for everyone and job creation is slower than needed. But job openings do exist and education is a significant differentiator. In 2007, there were 12 jobs for every job seeker with a bachelor’s degree or more education, compared with 2.9 jobs for workers with a high-school diploma. In 2011, there were 5.6 openings for workers with a college degree or more, compared with 1.6 for workers with just a high-school diploma.

The Brookings study shows that metropolitan areas with lower education gaps have lower unemployment rates for people with college degrees as well as workers with high school only, and even workers who are under age 18.

Enrico Moretti, an economics professor at the University of California, Berkeley, stated in the Wall Street Journal, that the importance of a skilled work force goes beyond just current workers.

Over the past two decades, education has been the best single predictor of a city’s chances of economic success—for all workers, not just the doctors doing surgery or the tech workers belting out computer code.

“Cities with highly educated workers attract employers that create wealth and then (employees) spend it in the local service sector, supporting the vast majority of us,” Mr. Moretti said.

You can read more about the mismatch between education levels and job vacancies here.

And you can download the Brookings report about education and job openings here.


Ira S Wolfe