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Order Code 97-764 E
CRS Report for Congress
Received through the CRS Web
The Skill (Education) Distribution of Jobs: How
Is It Changing?
Updated June 5, 2000
Linda Levine
Specialist in Labor Economics
Domestic Social Policy Division
Congressional Research Service ~ The Library of Congress
The Skill (Education) Distribution of Jobs: How Is It
Changing?
Summary
About 3 out of 5 jobs projected to be created through 2008 could have relatively
high skill requirements (i.e., typically requiring some postsecondary education). This
leaves 8.1 million new jobs for workers with relatively low skill levels (i.e., typically
high school graduates). Thus, firms are expected to continue to need workers from
a variety of educational backgrounds to fill those jobs that will be added to the labor
market by economic growth during the first decade of the 21st century.
Through 2008, the most skilled jobs (i.e., typically requiring a bachelor's degree)
could experience the largest percent increase in employer demand. Employment also
will likely expand, but at much slower rates, among jobs with lesser skill requirements.
Despite the differences in rates of new job creation, the skill distribution of
employment is expected to look much the same: about one-half of all jobs typically
requiring at least some postsecondary education and about one-half typically
requiring no more than high school completion. This stability reflects the fact that
the projected addition of 20.3 million jobs to the labor market through 2008
represents a small increment to 1998's sizable employment base of 141 million.
Employers need workers not only to fill new jobs, but also to fill existing jobs
that become vacant as workers move into other occupations, retire or otherwise leave
the labor force. "Replacement needs" are an important source of job openings,
particularly in slowly expanding or contracting fields. For example, 3.3 million of the
least skilled jobs might be added to the labor market between 1998 and 2008, but 14.1
million new and existing low-skilled jobs might become available over the projection
period. The difference reflects the jobs of departing employees that firms will need
to fill. While the lowest skilled workers would be qualified to compete for just 16%
of the 20.3 million new jobs projected to be created through 2008, they have the
educational level to compete for 26% of the 55.0 million new and existing jobs
expected to open up over the 10-year period. Thus, a focus on job growth alone
provides an incomplete picture of employers' skill requirements and a misleading
impression of the job market faced by low-skilled workers.
Oftentimes, members of the education and training community have focused on
those occupations expected to grow the most rapidly to urge students to obtain a
bachelor's degree or, at the least, get postsecondary education that leads to an
associate's degree or vocational certificate. This analysis demonstrates that jobs will
continue to be there in abundant numbers for workers with no more than a high
school education, that is, the report addresses the employment prospects of relatively
low-skilled workers. In terms of wage prospects, however, firms have been paying
a much larger premium than in the past to employees with bachelor's degrees. The
current size of the wage gap between more and less educated workers suggests that
there is something in addition to the barely perceptible shift toward heightened job
skill requirements (as measured by educational attainment) that has prompted
employers to increasingly favor workers with a 4-year college degree over other
workers.
Contents
A Skill Hierarchy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
A Caveat . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
The Hierarchy's Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Projected Job Growth by Skill Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Highest Skilled Category . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Moderately High-Skilled Category . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
The Two Lower-Skilled Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Contracting Job Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Expanding Job Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Changes in the Share and Number of Jobs by Skill Level . . . . . . . . . . . . . . . . . 10
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
List of Tables
Table 1. Skill Hierarchy based on the Distribution of Educational Attainment by
Occupational Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Table 2. Actual and Projected Employment by Occupational Skill Cluster, 1998 and
2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Table 3. Distribution of Employment, 1998 and 2008 . . . . . . . . . . . . . . . . . . . 11
Table 4. Job Growth and Total Job Openings by Skill Cluster, 1998-2000 . . . 12
Appendix Table. Job Growth and Total Job Openings by Occupations Within the
Skill Clusters, 1998-2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
The Skill (Education) Distribution of Jobs: How
Is It Changing?
One of the prominent questions in the late 1980s was whether workers would
be available in sufficient numbers to meet the seemingly heightened job skill
requirements of employers. With the unemployment rate in the 1988-1990 period
averaging below 6% annually, the specter was raised of a labor shortage generally.
Simultaneously, concern was expressed about the build-up of an excess supply of low-
skilled workers relative to their reportedly dwindling job opportunities over the years.1
After an initially slow rebound from the 1990-1991 recession, the unemployment
rate fell below 5% in 1997 and has remained at that level for the past few years. As
a consequence, the Federal Reserve Board has been concerned that an overall
shortage of workers could brake the long-running economic expansion by preventing
firms from continuing to fulfill the demand for goods and services in a low-inflation
environment.2 At the same time, the focus of Congress has been on whether there are
enough workers at the high and the low end of the skill spectrum to meet employers'
demand for labor (e.g., information technology and farm workers, respectively).3
Nonetheless, the perception of limited job options for low-skilled workers has
continued to command attention (albeit muted). The cautionary remarks of several
policy analysts that welfare recipients would be unable to meet the work requirements
in reform legislation enacted in 1996 have given way today to fear that, once the
economy sputters, these individuals will be the first to be laid off and will then face
1
See, for example, Johnston, William B., and Arnold B. Packer. Workforce 2000: Work and
Workers for the Twenty-first Century. Washington, D.C., U.S. Govt. Print. Off., 1987.;
Commission on Workforce Quality and Labor Market Efficiency. Investing in People: A
Strategy to Address America's Workforce Crisis, volumes I and II. Washington, D.C., U.S.
Govt. Print. Off., 1989; and, Commission on the Skills of the American Workforce.
America's Choice: High Skills or Low Wages. Rochester, NY, National Center on
Education and Economy, 1990. Note: In a sequel to Workforce 2000 (Judy, Richard W. and
Carol D'Amico. Workforce 2020: Work and Workers in the 21st Century. Indianapolis,
Indiana, Hudson Institute, 1997), the authors acknowledged that low-skilled jobs are not
actually going to disappear because of the distinction between new jobs and existing jobs
which open up as employees retire or leave their positions for other reasons. Worforce 2000
largely focused on new job growth. This important distinction will be discussed later in this
CRS report.
2
CRS Report RL30283, The Unemployment Rate and the Potential Supply of Labor, by
Linda Levine.
3
For more information see CRS Report RL30140, An Information Technology Labor
Shortage? Legislation in the 106th Congress, and CRS Report RL30395, Farm Labor
Shortages and Immigration Policy, both by Linda Levine.
CRS-2
few choices for reemployment due to their typically brief work experience and low
skill levels. Others in the public policy community have continued to debate whether
the influx of immigrants with little schooling has exacerbated low-skilled native-born
workers' already poor employment and wage options.4
Those who believe there is an ongoing mismatch between the skill composition
of the workforce and the skill requirements of jobs have urged individuals to obtain
additional education or training to improve their chance of succeeding in the labor
market.5 For example, some Members of Congress have endorsed assisting students
and workers in this endeavor through education tax credits and deductions or through
increased funding of Pell grants and the Workforce Investment Act. Federal
appropriations and income tax credits also have focused on providing training or work
experience to welfare recipients, among others, with poor job prospects due to
presumably low skill levels.6 In addition, some have advocated the adoption of a
more labor-market-oriented approach to immigration that would curtail the admission
of persons having limited formal education to reduce competition with less skilled
native-born workers.
This report examines whether employers have been increasing their demand for
high-skilled workers and, at the same time, decreasing their demand for low-skilled
workers. It does this by analyzing projected rates of occupational employment
growth by education level between 1998 and 2008. The report determines whether
the emerging pattern of job growth is likely to have much of an effect on the overall
skill distribution of employment and on the number of jobs available to less skilled
workers. It also distinguishes between jobs that are added to the labor market
through economic growth (i.e., new jobs) and positions that become available to
jobseekers due to occupational turnover (i.e., filling vacancies in existing jobs).
A Skill Hierarchy
Statistics are regularly collected on the educational distribution of workers
employed in different occupations. Educational attainment by occupational group can
serve as a rough approximation of a job's skill level. The Congressional Research
Service (CRS) developed the skill hierarchy shown below from the distribution of
4
For more information see CRS Report 95-408, Immigration: The Effects on Native-Born
Workers, by Linda Levine; and CRS Report 95-1210, Immigrant Skills: Trends and Policy
Issues, by Ruth Ellen Wasem and Linda Levine.
5
Indicators of success in the labor market include an individual experiencing relatively little
unemployment or relatively high wages. Generally, workers with more schooling are less
likely to become unemployed and are more likely to have higher earnings. See, for example,
CRS Report 95-1081, Education Matters: Earnings by Highest Year of Schooling
Completed, by Linda Levine. (Hereafter cited as CRS Report 95-1081, Education Matters.)
6
CRS Report RS20134, Welfare Reform: Welfare-to-Work Legislation in the 106th
Congress, by Christine Devere, and CRS Report RL30089, Employment Tax Credits
Expiring during the 106th Congress, by Linda Levine.
CRS-3
educational attainment by occupational group of employed persons aged 16 or older
according to the March 1999 Current Population Survey (CPS).
A Caveat
A major caveat that readers should keep in mind while they proceed through this
report is that educational attainment was the sole criterion for slotting occupational
groups in the hierarchy. However, employees often develop skills through formal on-
the-job training programs (e.g., attending on-site classes) or through informal
instruction (e.g., learning by watching others) rather than through additional years of
formal education. For example, workers in some blue-collar occupations in the
construction trades (e.g., heavy equipment operators and electricians) may participate
in apprenticeships and workers whose jobs now commonly require computer skills
(e.g., professional and administrative support employees) may participate in employer-
provided training to use word-processing or spreadsheet software. The allocation of
occupations to the hierarchy does not reflect job skills acquired outside of school
settings because of scanty data on employer-provided training.7
The Hierarchy's Structure
The four skill levels of the hierarchy are based on the following educational
distributions by occupational group.
! A near majority (at least 46%) of workers in the occupations that
make up the highest skilled group had earned a bachelor's or higher
degree.
! A majority of workers in the occupations that comprise the
moderately high-skilled cluster had some postsecondary education.
! A majority of workers in the two lower skilled groups had at most
completed high school.
a) In the moderately low-skilled cluster, a substantial portion
(about 40%) of workers had not gone beyond high school.
b) In contrast, many workers in the lowest skilled cluster had
not attended high school (e.g., 25% of farmworkers, 19% of
private household workers and 13% of cleaning service workers
did not go beyond elementary school).
See Table 1.
7
For more information see CRS Report RL30546, Employer-Provided Training, by Linda
Levine.
CRS-4
Table 1. Skill Hierarchy based on the Distribution of Educational
Attainment by Occupational Group
Educational
Occupational composition
attainment
Highest Executive, administrative and managerial workers
Professional specialty workers
Technicians/technologists excluding heath, engineering and science
(e.g., computer programmers, legal assistants, and aircraft pilots)
Financial and business services, insurance and related sales agents
Moderately Health, engineering and science technicians/technologists (e.g., licensed
high practical nurses and electrical/electronic technicians)
Marketing and sales worker supervisors
Administrative support workers, including clerical
Protective service workers (e.g., guards, police, and firefighters)
Moderately Personal service workers (e.g., child care workers, personal care and
low home health aides, and hairstylists and cosmetologists)
Health service workers (e.g., nursing aides, orderlies and attendants)
All other service workers not elsewhere classified
Precision production, craft and repair workers (e.g., carpenters,
electricians, auto mechanics, and machinists)
Farmers and farm managers
Lowest Retail sales persons, cashiers, counter clerks and other sales workers
not elsewhere classified
Private household workers (e.g., cleaners and child care workers)
Food preparation and service workers (e.g., cooks and waitresses)
Cleaning and building service workers, except private household
Operators, fabricators and laborers (e.g., sewing machine and
packaging/filling machine operators, welders, truck drivers, and hand
packers/packagers)
Farmworkers and related agricultural workers (e.g., landscaping and
groundskeeping laborers)
Forestry, fishing and related workers (e.g., veterinary assistants and
nonfarm animal caretakers, fishers, and timber cutters)
CRS-5
Projected Job Growth by Skill Level
Forty-one percent (8.3 million) of the 20.3 million jobs the U.S. Bureau of Labor
Statistics' (BLS) estimates will be added to the labor market over the 1998-2008
projection period could be in the highest skilled cluster of occupations.8 Another one-
fifth (4.0 million) of new jobs could fall in the moderately high-skilled category.
Taken together, then, jobs requiring a fairly high skill level could account for 3 out
of every 5 new jobs created between 1998 and 2008. (See Table 2, columns 4 and
6.)
Almost one-fourth (4.7 million) of jobs resulting from economic growth over the
10-year projection period could lie in the moderately low-skilled cluster of
occupations. Another 16% (3.3 million) of new jobs could be added to the lowest
skilled category. Thus, employers are expected to continue to need workers from a
variety of educational backgrounds for the new jobs created during the first decade
of the 21st century.
Highest Skilled Category
The most rapid growth (22%) among the four categories in the hierarchy is
expected to occur in the highest skilled occupations. All of the occupational groups
that make up the highest skilled cluster are projected to grow at above the average
rate (14%). Within the highest skilled cluster, professional and technical (excluding
health and engineering/science) jobs could experience the relatively largest expansion
(27%) over the projection period. (See Table 2, column 5.)
Regardless of skill category, computer-related professional positions are
estimated to be the fastest growing (i.e., computer engineers, 108%; computer
support specialists, 102%; systems analysts, 94%; and database administrators, 77%).
Except for database administrators, these also are among the occupations projected
to post the largest absolute increases in employment (i.e., systems analysts, 577,000;
computer support specialists, 439,000; and computer engineers, 323,0000).9
In the technicians (excluding health and engineering/science) group, paralegal
and legal assistants (62%) and computer programmers (30%) are projected to grow
at well above the all-occupations' average rate (14%). It is anticipated that computer
programmers also will be among those occupations reporting the greatest absolute job
growth (191,000) between 1998 and 2008.10
8
The U.S. Bureau of Labor Statistics developed the projections. CRS used the skill hierarchy
it developed to group employment by occupation in 1998 and 2008.
9
Braddock, Douglas. Occupational Employment Projections to 2008. Monthly Labor
Review, November 1999. (Hereafter cited as Braddock, Occupational Employment
Projections to 2008.)
10
Braddock, Occupational Employment Projections to 2008.
CRS-6
Table 2. Actual and Projected Employment by Occupational Skill Cluster, 1998 and 2008
%
Employment (000) Employment change Distribution
of
Occupational skill cluster Number employment
1998 2008 %
(000) change
Total, all occupations 140,514 160,795 20,281 14 100
High-skilled occupations 36,840 45,098 8,258 22 41
Executive, administrative, and managerial workers 14,770 17,196 2,426 16 12
Professional specialty workers 19,802 25,145 5,343 27 26
Technicians, excluding health and engineering and science 1,152 1,460 308 27 2
Financial and business services, insurance, and related sales workers 1,116 1,297 181 16 1
Moderately high-skilled occupations 33,612 37,580 3,969 12 20
Health technicians and technologists 2,447 3,063 616 25 3
Engineering and science technicians and technologists 1,351 1,525 175 13 1
Marketing and sales worker supervisors 2,584 2,847 263 10 1
Administrative support, including clerical workers 24,461 26,659 2,198 9 11
Protective service workers 2,769 3,486 717 26 4
Moderately low-skilled occupations 35,235 39,965 4,731 13 23
Retail sales persons, cashiers, and sales workers not elsewhere classified 11,641 13,483 1,842 16 9
Health service workers 2,309 2,984 676 29 3
Personal service workers 2,934 3,828 894 31 4
All other service workers not elsewhere classified 1,249 1,490 241 19 1
Precision production, craft and repair occupations 15,619 16,871 1,252 8 6
Farm operators and managers 1,483 1,309 -174 -12 -1
CRS-7
%
Employment (000) Employment change
Distribution
of
Occupational skill cluster
Number employment
1998 2008 %
(000) change
Low-skilled occupations 34,826 38,151 3,324 10 16
Private household workers 928 751 -178 -19 -1
Food preparation and service workers 8,735 9,831 1,096 13 5
Cleaning and building service workers, excluding private household 3,623 4,031 408 11 2
Operators, fabricators and laborers 18,588 20,341 1,753 9 9
Farmworkers, forestry and fishing workers, and related workers 2,952 3,197 245 8 1
excluding farmers and managers
Source: Created by the Congressional Research Service from U.S. Bureau of Labor Statistics' data.
Note: Numbers may not add to totals due to rounding.
CRS-8
Moderately High-Skilled Category
Job creation in the moderately high-skilled cluster could be slightly below the
average rate (i.e., 12% versus 14%), in large part because of its inclusion of the
administrative support group. The continuing dissemination of technological
innovations appears to be primarily responsible for the slow job growth (9%) in
numerous administrative support occupations. Nonetheless, administrative support
is expected to remain the largest occupational category -- although in 2008, its lead
over the professional group could narrow considerably (to 1.5 million jobs). (See
Table 2, columns 3 and 5.)
Office automation resulting in productivity improvements as well as managers'
and professionals' now common use of computer software is expected to mean fewer
jobs for typists and word processors in 2008 (down by 93,000 or 20%). The
spreading application of office automation also is expected to reduce the demand for
labor in financial records processing occupations such as bookkeeping, accounting
and auditing clerks (-81,000 or -4%) as well as for bank tellers (-31,000 or -5%). In
addition, BLS projects that the need for computer operators will decline by 64,000
or 26% as automation reaches the "computer room" itself (e.g., programs and robots
that allow computers to perform routine tasks once handled by people) and as firms
move away from the large mainframes that these employees operate. Continuing
technological change and organizational restructuring (e.g., mergers) in the
telecommunications industry could cut employment of telephone operators by 41,000
or 16%, as well.11
The inclusion in the moderately high-skilled cluster of health technicians and
technologists (e.g., medical records technicians and surgical technologists) and of
protective service workers (e.g., correctional offices and police) offsets the relatively
slow pace of job growth in administrative support occupations between 1998 and
2008. However, the above-average increases in employment projected for health
technicians/technologists (25%) and for protective service workers (26%) could
account for just 3% and 4%, respectively, of all new jobs created over the period
because of the occupational groups' small employment bases. In contrast, despite the
slow employment growth projected for administrative support jobs, they could expand
by 2.2 million and account for 11% of all jobs added to the labor market due to the
occupational group's large employment base. (See Table 2, columns 4 and 5.)
The Two Lower-Skilled Categories
The heterogenous composition of the two lowest skilled clusters also has an
impact on their anticipated growth rates of 13% for the moderately low-skilled group
and of 10% for the lowest skilled group. The inclusion of farming occupations and
of blue-collar occupations (i.e., precision production, craft and repair workers; and
operators, fabricators and laborers) is expected to dampen the two skill categories'
rates of expansion. Conversely, the inclusion of service and retail occupations shores
up the projected pace of employment gains in the two lower skilled groups. (See
Table 2, column 5.)
11
Braddock, Occupational Employment Projections to 2008.
CRS-9
Contracting Job Opportunities. Reflecting the continuing employment decline
in the agricultural sector of the economy,12 farmers (classified in the moderately low-
skilled group) and farmworkers (classified in the lowest skilled group) are projected
to be among the occupations experiencing the largest absolute decreases (down
173,000 jobs or 13% and 57,000 jobs or 7%, respectively).13
Similarly, cutbacks at sewing and textile manufacturers14 are expected to largely
account for the dwindling prospects of workers in some blue-collar occupations.
Within the lowest skilled category, for example, sewing machine operators in the
garment trade could experience a 112,000 job loss (or 30% reduction) and
operators/tenders of certain textile machines, a 50,000 job loss (or 26% reduction).15
Growing reliance on computer-controlled technology appears to explain more of the
projected employment declines among other blue-collar occupations. In the
moderately low-skilled group, the number of positions for precision inspectors, testers
and graders could fall by 22,000 or 3% for example. Blue-collar jobs in the
printing/publishing industry also could suffer employment contractions associated with
computer technologies: in the lowest skilled group, offset lithographic press
operators could lose 9,000 jobs (a 15% cutback) and typesetting/composing machine
operators/tenders, 8,000 jobs (a 60% cutback); in the moderately low-skilled group,
the number of printing film strippers could drop by 8,000 or 33%.16
Despite these and other absolute decreases in some blue-collar fields, total
employment of blue-collar workers is projected to grow -- by 8% for precision
production, craft and repair occupations in the moderately low-skilled group; and by
9% for operators, fabricators and laborers in the lowest skilled group. Given the
substantial numbers of blue-collar jobs currently in existence, these relatively low
growth rates could add 3.0 million jobs and account for 15% of all new jobs created
between 1998 and 2008. (See Table 2, columns 4, 5 and 6.)
In contrast, the experience of private household workers is expected to be more
like that of farmers and farmworkers, and less like that of other service workers (see
below). In other words, employment in the private household occupational group is
expected to continue its downward trajectory. Both child care workers and
cleaners/servants who work in private homes are among the occupations that could
12
Employment in the agricultural industry is projected to fall by 377,000 jobs between 1998
and 2008, following a decline of 186,000 between 1988 and 1998. Thomson, Allison.
Industry Output and Employment Projections to 2008. Monthly Labor Review, November
1999. (Hereafter cited as Allison, Industry Output and Employment Projections to 2008.)
13
Braddock, Occupational Employment Projections to 2008.
14
Employment in the apparel industry is projected to decrease by 197,000 jobs between 1998
and 2008, following a loss of 341,000 between 1988 and 1998. Employment in the textile
mill products industry could fall by 97,000 over the 1998-2008 projection period in addition
to a 130,000 job cutback recorded in the prior 10 years. Allison, Industry Output and
Employment Projections to 2008.
15
Braddock, Occupational Employment Projections to 2008.
16
Ibid.
CRS-10
incur the heaviest job losses through 2008 (97,000 or 32% and 71,000 or 12%,
respectively).17
Expanding Job Opportunities. The aging of the population likely contributes
to the robust job gains projected for health and personal service occupations in the
moderately low-skilled cluster. The number of medical assistants could increase by
58% (or 146,000), physical therapy assistants/aides by 44% (or 36,000), dental
assistants by 42% (or 97,000) and nursing aides/orderlies/attendants by 24% (or
325,000) during the projection period. Similarly, employment of personal care and
home health aides -- spurred, in part, by the shift toward outpatient and home care
-- is projected to rise by 58% (or 433,000). In addition, the continuing presence in
the labor force of mothers with young children probably underlies the anticipated 26%
(or 236,000) increase in child care jobs.18
One set of occupations in the moderately low-skilled group that has only a
slightly above-average projected growth rate could add more jobs than some of the
fast-growing occupations because of its large employment base. Specifically, 13.5
million individuals worked as retail sales persons, cashiers and other sales workers in
1998. If their employment increases by 1.8 million as projected, 9% of the total job
gains between 1998 and 2008 would occur in these sales occupations. (See Table 2,
columns 4, 5, and 6.) Expansion in the retail trade industry (e.g., department or
discount merchandise stores) will likely account for much of the employment uptick
in retail sales occupations during the projection period.19
Growth in the eating/drinking places component of the retail trade industry also
could spur large employment gains in food preparation and service occupations (e.g.,
waiters/waitresses with 303,000 jobs as well as food counter, fountain and related
workers with 247,000 jobs). Another service occupation -- janitors and cleaners --
could expand greatly as well (365,000 jobs).20
Changes in the Share and Number of Jobs by Skill Level
Despite their different rates of projected job growth, the skill clusters' shares of
total employment are likely to remain about the same. As shown in Table 3, the
highest skilled category of occupations accounted for 26% of all jobs in 1998; by
2008, the proportion could rise very modestly to 28% of the total. Both the
moderately high-skilled group and the lowest skilled group could experience a very
slight erosion in their shares of jobs over the projection period, from 24% to 23% for
the moderately high-skilled group and from 25% to 24% for the lowest skilled group.
In contrast, the moderately low-skilled group is expected to remain at 25% of total
17
Ibid.
18
Ibid.
19
Employment across the entire retail trade industry is projected to expand by 3.1 million
jobs, somewhat less than the 3.3 million job gain in the 1988-1998 period. Allison, Industry
Output and Employment Projections to 2008.
20
Braddock, Occupational Employment Projections to 2008.
CRS-11
employment. This stable pattern reflects the fact that the new jobs induced by
economic growth (20.3 million) represent a small increment to the very sizable,
existing employment base (140 million in 1998).
Table 3. Distribution of Employment, 1998 and 2008
Occupational skill cluster 1998 2008
All occupations 100% 100%
High 26 28
Moderately high 24 23
Moderately low 25 25
Low 25 24
Source: Created by CRS from BLS data.
New jobs are not the only ones available to jobseekers. Firms hire employees for
positions in both growing and shrinking occupations because many existing jobs must
be filled when workers move from one occupation to another, retire or otherwise
leave the labor force. Indeed, BLS expects that in most occupations more openings
will develop because of hiring to fill jobs vacated between 1998 and 2008 than
because of new jobs created by economic growth over the period.21
The need to replace workers is an especially important source of labor demand
in slow-growing occupations, and the only source of job openings in declining
occupations. For example, the lowest skilled cluster could add 3.3 million new jobs
between 1998 and 2008, but the number of positions available to the least skilled
workers could be considerably larger -- a total of 14.1 million jobs. (See Table 4.)
The 10.8 million difference between the two employment figures is "replacement
needs," that is, employers hiring workers into existing jobs that become vacant due
to employee mobility. While workers with the fewest years of education seemingly
would be qualified to compete for just 16% of the 20.3 million new jobs added to the
economy through 2008, they could have the skill requirements to fill 26% of the 55.0
million new and existing jobs expected to open up during the projection period. (See
the Appendix Table for a comparison of job growth and total job openings for each
of the skill hierarchy's occupational groups.)
Thus, the job opportunities available to newcomers to and current participants
in the labor force are not limited to the change in employment generated by economic
growth. Too great a focus on rates of job growth creates a misperception about how
rapidly the skill structure of employment is changing and about the job market faced
by low-skilled workers. The skill composition of new and existing jobs that will
continue into the future should be examined to develop a complete picture of the
nature of employers' skill requirements. Despite the concentration of new jobs in the
21
Braddock, Occupational Employment Projections to 2008.
CRS-12
highest skilled occupational cluster, it appears that workers with a high school
degree or less will continue to be in considerable demand during the first decade of
the 21st century. Specifically, while 41% of all new positions created between 1998
and 2008 could require workers to have at least a bachelor's degree, 52% of all jobs
that open up during the period could be available to workers with a high school
education at most. (See Table 4.)
Table 4. Job Growth and Total Job Openings by Skill Cluster, 1998-
2000
Employment changea Total job openingsb
Occupational skill
cluster Number Percent Number Percent
(in 000) distribution (in 000) distribution
All occupations 20,281 100 55,008 100
High 8,258 41 15,367 28
Moderately high 3,969 20 11,359 21
Moderately low 4,731 23 14,149 26
Low 3,324 16 14,133 26
Source: Calculated by CRS from BLS data.
Note: Numbers may not add to totals due to rounding.
a
Employment change reflects the number of new jobs created by economic growth.
b
Total job openings reflects the number of new jobs created by economic growth and the number
of existing jobs employers are expected to fill as the jobs are vacated by workers moving into other
occupations, retiring or permanently leaving the labor force for other reasons (i.e., net replacement
needs).
Conclusion
The skill structure of employment is likely to remain quite stable through 2008.
Employers are demanding a more highly educated labor force, but they also continue
to need workers across the entire skill spectrum. Too great a focus on the rate of new
job creation due to economic growth -- without regard to the current size and
composition of employment as well as to the number and nature of jobs generated by
occupational turnover -- results in a misperception about the speed and extent of
change in the skill structure.
As defined in this report, low-skilled jobs are not disappearing. Many
occupations with limited educational requirements are experiencing above-average
rates of job growth or substantial increases in employment levels. Consequently, jobs
that typically require a high school diploma or less could continue to account for
about one-half of total employment in 2008, just as they did in 1998. And, in
relatively slow-growing or declining occupations, many jobs are expected to become
CRS-13
available to low-skilled jobseekers because employers will need to fill vacancies
created by departed employees.
Oftentimes, members of the education and training community have focused on
those occupations expected to grow the most rapidly to urge students to obtain a
bachelor's degree or, at the least, get postsecondary education that leads to an
associate's degree or vocational certificate. This analysis demonstrates that jobs will
continue to be there in abundant numbers for workers with no more than a high
school education, that is, the report addresses the employment prospects of relatively
low-skilled workers. In terms of wage prospects, however, firms have been paying
a much larger premium than in the past to employees with bachelor's degrees.22 The
substantial widening of the wage gap between more and less educated workers
suggests that there is something in addition to the barely perceptible shift toward
heightened job skill requirements (as measured by educational attainment) that has
prompted employers to increasingly favor workers with a 4-year college degree over
other workers. Perhaps firms are more generously rewarding employees who have
attained bachelor's degrees because they believe this indicates that these workers have
the ability to more easily learn competencies that may be added to jobs over time
(e.g., using ever-evolving technologies) or to more readily adjust to organizational
restructuring (e.g., having attributes that enable them to function well in a team
environment).
With so little understanding of why the demand for education is behaving as it is,
and with no discernible shift toward occupations that require higher literacy or
education, we need to be cautious about predicting the future. About all we can
say is that in the recent past earnings of college graduates have exceeded earnings
of those with less education by wide margins.23
22
On average, the wage gap between male college and high school graduates widened from
about 33% to 48% between the latter half of the 1970s and 1998. The average wage gap
between female college graduates and female high school graduates grew from about 29% to
43% over the same period. CRS Report 95-1081, Education Matters.
23
Barton, Paul E. What Jobs Require: Literacy, Education, and Training, 1940-2006.
Princeton, NJ, Educational Testing Service, January 2000. p. 35.
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Appendix Table. Job Growth and Total Job Openings by Occupations Within the Skill Clusters, 1998-2008
Employment changea Total job openingsb
Number (in Percent Number (in Percent
Occupational skill cluster
000) distribution 000) distribution
Total, all occupations 20,281 100 55,008 100
High-skilled occupations 8,258 41 15,367 28
Executive, administrative, and managerial workers 2,426 12 5,107 9
Professional specialty workers 5,343 26 9,249 17
Technicians, excluding health and engineering and science 308 2 635 1
Financial and business services, insurance, and related sales 181 1 376 1
workers
Moderately high-skilled occupations 3,969 20 11,359 21
Health technicians and technologists 616 3 1,124 2
Engineering and science technicians and technologists 175 1 492 1
Marketing and sales worker supervisors 263 1 601 1
Administrative support, including clerical workers 2,198 11 7,652 14
Protective service workers 717 4 1,490 3
Moderately low-skilled occupations 4,731 23 14,149 26
Retail sales persons, cashiers, and sales workers not elsewhere 1,842 9 5,833 11
classified
Health service workers 676 3 1,064 2
Personal service workers 894 4 1,413 3
All other service workers not elsewhere classified 241 1 546 1
Precision production, craft and repair occupations 1,252 6 5,061 9
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Employment changea Total job openingsb
Number (in Percent Number (in Percent
Occupational skill cluster
000) distribution 000) distribution
Farm operators and managers -174 -1 232 0
Low-skilled occupations 3,324 16 14,133 26
Private household workers -178 -1 276 1
Food preparation and service workers 1,096 5 5,159 9
Cleaning and building service workers, excluding private 408 2 1,164 2
household
Operators, fabricators and laborers 1,753 9 6,369 12
Farmworkers, forestry and fishing workers, and related work 245 1 1,165 2
excluding farmers and managers
Source: Created by the Congressional Research Service from U.S. Bureau of Labor Statistics' data.
Note: Numbers may not add to totals due to rounding.
a
Employment change reflects the number of new jobs created by economic growth.
b
Total job openings reflects the number of new jobs created by economic growth and the number of existing jobs employers are expected
to fill as the jobs are vacated by workers moving into other occupations, retiring or permanently leaving the labor force for other reasons
(i.e., net replacement needs).
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