How to Prepare for a

Changing Workforce

Stories of 2030

Marcy Ewald Neil ShahSenior Account Manager, Aspire Director, Aspire

What we work on.

The way we work.

Why work matters.

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What we work on.

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SNAPSHOT: 2018

“Accelerating the reweighting of the U.S. economy toward service sectors, which now account for 70 percent of U.S. GDP. Some service industries (such as business and professional services) are highly profitable—and their wages reflect that. But other service industries (such as hospitality, retail, and office services) employ large, low wage workforces.”

Automating Labor-Based Industries

Skill-biased technological change● New positions created favor high-skill workers, and the positions eliminated are

largely those of low-skill workers. ● Technological change furthers the growing divergence in earnings between the

most and least educated segments of the workforce, hollowing out the middle.● Part-time positions will replace full-time-plus-benefits positions.

More than 10 million people in the U.S. economy stand to have their jobs 85-90% automated, and nearly all of these positions are low-wage.

Automation shifts power toward large employers.

SNAPSHOT: 2018

“Nearly one in three high schoolers take a degree, a tenth graduate from a two-year associates program and a $1.4 trillion student debt bubble restrains consumption and economic growth.”

Education, Good Jobs, and Student Debt

65%of all jobs will require some post-secondary education by 2020.

Between 1991 and 2015, the share of good jobs going to workers without a BA fell from 60 percent to 45 percent.

11.5 million Of the 11.6 million jobs added since 2010 that went to workers with at least some college education.

2016 unemployment rate of young workers with a high

school diploma vs. college grads.3x

US jobs lost during the great recession not to declining demand but to the skills gap

High schoolers who earn a degree1/3 Educational attainment falls short

38 million Expected shortfall of workers with tertiary education

1/10 High schoolers who graduate from a two-year associates program

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300%Millennials’ student debt ratio to their parents’ generation

$20,000 Cost of some vocation licensing.

American workers who require some sort of state license to do their jobs. In 1950, 5% of jobs required licensing.

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Burdensome licensing practices

1,200 Hours of instruction and unpaid practice some vocations require.

Education is contributing to a stratified society.

What we work on.

Automation is changing the jobs we do.Education isn’t preparing us for those jobs.

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SNAPSHOT: 2030

Training for Good Jobs

“If policymakers want to get serious about restoring the health of the middle class, mapping the educational pathways and the occupational pathways available to workers at different levels is crucial.”

Designing lifelong learning curriculum

Flexible, Modular Coursework

Prove Reliability of Courses

Focus on Clientele

Collaborate Across Sector

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Intensive collaboration between industry and providers to define required competencies at a detailed level.

Shadow employees on the job in those

professions. The goal is to identify which

activities most differentiate high from low

performers and to translate this insight into

training for the right technical, behavioral, and

mind-set skills which include attributes such as

punctuality, diligence, and follow-through). Such

observation is important, because our experience

is that many employers are unable to accurately

describe which skills matter most, leading to

errors in program design.

Automotive Manufacturing Training and Education Collective (AMTEC) offers an example of how this can work. To develop the AMTEC curriculum, high-performing technicians (not managers) from several auto companies outlined every task they performed and the competencies required for each. They then ranked these based on importance, developing a list of tasks common to the dozens of companies involved over several rounds of iterations. This was done for each specific activity, leaving no room for confusion.

Flexible, Modular Coursework

Flexible, Modular Coursework

Practical application of coursework.

Hands-on bootcamps for in-depth learning.

Useful assessments directly tied to desired outcomes.

Allow for specialization.

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Prove Reliability of CoursesTailor coursework to local audience. Every community college across the country could be mobilized in this effort, working hand in hand with local employers to keep curricula up to date and relevant to the local job market.

Show ROI to employers and employees. If the ROI case can be proved, our research and experience shows that employers are willing to pay for training programs—up to 15 percent (or roughly two months) of the employee’s annual salary, on average.

Use assessments to show improvement over time and consistency across cohort.

Show employee retention over time.

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Focus on Clientele Provide childcare and classes after hours with flexible access points, and think about transportation

options. Mobile, on your drive home, hands-on interaction with excel, etc. How would this differ if you were working with high schoolers, FTE, new mothers, prisoners, etc.?

Provide clear outcomes to clients before payment.

Work with participating companies to remove non-competes.

Focus on mentorship.

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Government, both state and local and private companies (even competitors). Down a supply chain, with an anchor company taking the lead in encouraging its suppliers to participate; by a functional profession (for example, mechatronics) that is in demand by employers in different industries in the same location; and by sector, with competitors collaborating because they all face the same talent problem.

Encourage moving to productive jobs and locations. Remove barriers to certification, help with relocation costs, help cities reinvent themselves.

Collaborate Across Sector

Provide and use national subsidies. Government subsidizes up to 80% of costs in South Korea. Estimated spending on US workforce-development programs for those not going to four-year colleges—everything from federal and state jobs programs, workforce training and certifications, community college, and employer training—is at least $300 billion a year.

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Effective training incorporates five components.

Staying above the API.

Through the Workforce Ready Grant, working-age Hoosiers can enroll at no cost in career-focused programs at Ivy Tech Community College or Vincennes University.

The Workforce Ready Grant targets in-demand occupations within high-growth sectors of Indiana’s economy – Advanced Manufacturing, Building & Construction,

Health & Life Sciences, IT & Business Services, and Transportation & Logistics.

Indiana

84% of Generation’s graduates have been placed in jobs. Average income for graduates is 2-6 times what it was before the program. 54% of students are female

and one third are parents. 98% of the 1000+ employers who have hired a Generation graduate say they would do so again. Operating costs per student are

20-50% of comparable programs in each country.

Generation

Good jobs are growing in skilled-service industries.

Career tracks give way to lifelong curriculum tracks.

The way we work.

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SNAPSHOT: 2018

Wage Depression in a Healthy Economy

Depressed wages are kindling in an economy transitioning from asset-heavy manufacturing to a knowledge-based economy. The winners are a small group of highly educated employees, leaving large swaths of the workforce excluded from gains in the economy.

Unraveling the historic tie between wages and corporate profits.

Labor incomes for everyone except the highest quintile are no higher in real terms than they were in the late 1990s.

14%U.S. workforce making more than $75,000 per year in 2015

The winners of economic growth are a small group of highly educated employees.

SNAPSHOT: 2018

Alternative Work Arrangements

“In America, more than any other developed country, jobs are the basis for a whole suite of social guarantees meant to ensure a stable life. Workplace protections like the minimum wage, overtime, health insurance, and pensions, are built on the basic assumption of a full-time job with an employer.”

~40%Government Accountability Office best estimate of total workers in a

“contingent arrangement” with an employer.The industry that has added the most jobs since the recession is not tech or retail or

nursing. It is “temporary help services”—all the small, no-brand contractors who recruit workers and rent them out to bigger companies.

Percentage of employed workers in alternative working arrangements, 1995 - 2015.

The rise in contingent work was as large for people with a bachelor’s degree as it was for those without a high school diploma.

9 millionJob growth in alternative work arrangements, representing all net job growth in the

American economy in 10 years. Just 0.5% are in the sharing economy.

1 in 6American workers under- or unemployed due to gaps in training programs.

How you work matters more than just your 9 to 5.

SNAPSHOT: 2018

Economic Opportunity Concentration

“Rather than offering Americans a way to build wealth, cities are becoming concentrations of people who already have it. In the country’s 10 largest metros, residents earning more than $150,000 per year now outnumber those earning less than $30,000 per year.”

The extreme concentration of economic activity skips huge swaths of employable people in middle America.

Percent of increased wages an unskilled worker keeps,who moved from a low-income state to a high-income state

1970

79%

Percent of increased wages an unskilled worker keeps,who moved from a low-income state to a high-income state

2010

36%

Between 2001 and 2014, the number of households spending over half their incomes on rent grew by more than 50 percent.

NY, MA, CAThe three states that receive 80% of venture capital investments

“Overall, about 90% of venture capital in 2015 went to “blue” states and just 10% went to those states that voted for President Donald Trump. This allocation of capital creates a cycle where a few places enjoy investment backing, partnerships and growth — and most of the rest of the country struggles to get ahead.”

Cities concentrate wealth, but don’t help to build it.

SNAPSHOT: 2018

The Office Building

Rapid, simple communication produces innovations and ideas, and the conference room provides a perfect proxy for brainstorming meetings.

Employees who work remotely four to five days a week.

31%

Potential improvements in GDP with better worker / workplace matching.

In person communication can be replicated asynchronously.

SNAPSHOT: 2030

Decentralizing Benefits, Workplaces, and Investments

Re-tooling traditional benefits, income-security, and paid-time-off policies in both the governmental policies and private sectors, and relaxing regulation to allow innovation in this space, will protect gig economy employees and allow them to take control of their own futures.

Simplify rules for investing to allow for crowdfunding and other methods of accessing capital.

Smaller cities need to deliberately nurture startup-friendly environments.

The Third WaveConnect founders to one another and local government and industry leaders.

Improve inclusivity so people from different backgrounds and expertise have the opportunity to pursue good ideas.

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Alleviating a security gap between low and high skill workers with direct employment or by allowing innovation for independently-held benefits.

portable benefitsUntying safety nets from stable employment to better fit the modern employee.

Employees as people, not units of labor.

Why work matters.

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SNAPSHOT: 2018

Meaning of Work

Do we work to live or live to work?

1 in 2 Employees who feel their job has “no meaning or significance,” according to a 2013

survey of 12,000 professionals by the Harvard Business Review.

Millennials’ retention when they have a strong connection to employer’s purpose.5.3x

Millennials, purpose, and loyalty

2.3x Non-millennials’ retention when they have a strong connection to employer’s purpose.

Only 27% of business leaders help employees connect their own purpose to the work of the company.

Ross Baird reviewed industries of over 150 “unicorn” companies in January 2016, and found that only 15 percent of the enterprises were solving problems in the top six areas that the majority of the world’s population spends its budget on.

The Innovation Blind Spot

Food

Housing

Agriculture

Financial Services

Energy

Health

Our jobs give our lives purpose.

SNAPSHOT: 2030

Investing Right, Not Rich

“Jobs are for robots and life is for people.”

Integrate engagement into the company's human capital strategy.

Integrating employee engagement

Don’t overlook tactical changes that can be made.

a. Performance management activities: clarify work expectations, get people what they need

to do their work, provide development, promote positive coworker relationships

b. "Doing what you do best" has more to do with productively applying individual strengths

than with general competencies

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Public policies that make starting a new business simpler, and removing roadblocks to investment, are critical to the growth of new jobs.

Rethink one-size-fits-all investment mindset infiltrating venture capital that is a holdover from centuries past.

Improving Blind Spots

Overhaul “it’s not what you know, it’s who you know.”

a. 2015 investment dollars: less than 5% to female founders, less than 1% to

African-American or Latino founders.

b. 2007-2012 investments: 10% of global startup financing went to graduates of Stanford,

Harvard, Berkeley, MIT, NYU, and UPenn

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3 Investing in zebras, not unicorns. Separating our values and our careers.

$1 trillionGlobal impact investing industry size by 2020.

Profit and purpose become increasingly intertwined.

Value the economy and shareholders equally with everyday Americans.

How to Prepare for a

Changing Workforce

Stories of 2030