This Pandemic Will Permanently Alter the Job Market. We Have to Start Preparing Now.
The numbers are astounding. The coronavirus has killed over 100,000 Americans. Forty million Americans have been laid off and are receiving unemployment benefits. Over 100,000 small businesses have closed permanently, with far more to come.
A seismic public health and economic catastrophe like this calls for an equally large federal rescue response. We must guarantee everyone gets tested and vaccinated, everyone gets proper coverage and treatment, and every frontline worker is protected. We must make sure every American family can continue to pay for necessities like housing, food, and broadband with continued direct cash payments and expanded SNAP benefits. And we must create a state fiscal stabilization fund to keep states and localities whole.
In addition to a massive rescue effort, we must also look to the future. Eventually the pandemic will stabilize, and our economy will start to recover. When this happens, it won’t look the same as before.
We know thousands of employers will not make it back from this recession, and many industries—from hospitality to retail—will be forever changed. We also know that the coronavirus has led companies to increase their use of technology, like automation and artificial intelligence, in response to the pandemic. Brookings has predicted that this pandemic will accelerate automation, particularly in occupations with routine tasks, including jobs in production, food service, and transportation. As these technologies become more prevalent, it raises the possibility that jobs will look far different than they did before the pandemic—and require workers to have different skills and credentials. We are likely to see a flood of laid-off workers go back to school to gain new skills, just as they did during the Great Recession. Shouldn’t we help them with the cost?
Congress must start planning now for how the federal government can support any worker who wants to upgrade their skills or gain new ones so they can regain their footing in a post-COVID-19 labor market. We should ensure they have funding to do so, particularly lower-income workers who were struggling before this crisis and have been disproportionately impacted by it. Employers should have skin in the game, but we’ll still need an infusion of public funding to fill in the gaps, particularly where small and medium-sized employers are concerned.
Senators Amy Klobuchar (D-MN), Ben Sasse (R-NE), Cory Booker (D-NJ), and Tim Scott (R-SC) have introduced the Skills Renewal Act to help address this problem. The bill would provide every American who lost their job in this pandemic with a refundable $4,000 skills training tax credit that could be used anywhere along the postsecondary pipeline—including apprenticeships, stackable credentials, certificate programs, and traditional two- and four-year programs. Since the pandemic has changed the way we learn, the bill would include programs that are online. The bill would only allow people to pay for programs that have had good outcomes on employment and earnings, that lead to credentials, and that are aligned with labor market needs. People would be allowed to claim this credit and apply it to the cost of training programs in either 2020 or 2021.
To be sure—the immediate problem is not that workers need to gain or upgrade skills, it’s that jobs are disappearing as the coronavirus halts economic activity. But eventually, we will recover from this pandemic, and economic activity will be able to resume. We need to think now about how we can help people who’ve been displaced and want to gain new skills. This will give American workers their best shot at coming back from this crisis and make our country stronger and more prosperous in the future. Senators Klobuchar, Sasse, Booker, and Scott should be thanked for taking an important step on this critical issue.
This bill should start an important discussion on how we tackle retraining for the future. When we help people retrain and provide funding for them to do so, those programs should be high-quality. They should have high completion rates. They should lead to credentials that employers respect and understand and should put workers onto well-paying, in-demand career pathways. Those credentials should be part of educational pathways as well—allowing people who earn a certificate or nondegree credential to pursue higher-level credentials later on if they decide to. Success will require employers to play an active role. Achieving all this in a pandemic will require more intense cooperation between community and technical colleges and employers than existed before. It will require employers to understand and communicate their hiring needs to those institutions, down to the skill-level.
The challenge before us is daunting. And nothing must stand in the way of a vital rescue effort to ensure families can survive this crisis. But it’s not too early to start thinking about our recovery.