Knowledge Economy Blog

For those interested in learning more about skills for the 21st century a webinar is coming up sponsored by the Workforce Alliance. Interesting to note that one topic will be “forgotten middle skills jobs.”

From the Workforce Alliance…

Launch of the Skills 2 Compete Campaign: A National Webinar

Ensure our workforce has the skills needed to meet business demand, foster innovation, and grow broadly shared prosperity.

Register now for the launch of the Skills2Compete Campaign, a National Webinar on November 12, 2007 at 12:00 p.m. EST.

Submitted by: Graham Cochran

The University of Michigan is hosting a regional meeting called The Role of Engaged Universities in Economic Transformation on October 15-16, 2007 based on the National Academy of Science’s Rising Above the Gathering Storm report. The three major focus areas of the conference are:

1. How does a state or region that has had its economic focus on manufacturing transform itself into one based on a knowledge economy that maintains a complementarity to its traditional base?

2. What elements define the significant role of research universities (and of higher education in general) of the state or region in effecting and being engaged in such a transition?

3. What incisive collaborative steps must be taken as part of state or regional initiatives and university strategies to catalyze this transition?

Looks like a good program for folks interested in the Knowledge Economy.

Robert Reich has written several ‘ah ha!” books; books that so clearly explain what is happening or has happened with the world economy that as you read you say to yourself, “so this is what is going on!”

His latest work, The Future of Success describes the changes we are currently experiencing in the world economy. If it feels like earning a living has gotten more complicated, stressful and difficult, it is because that is exactly the case. We are working harder than ever before, working longer hours with less security than the previous generation of workers. What Reich describes as the new economy is taking a toll on our lives and health. Reich does not however take the position that we should return to the ‘good old days’; ever the realist, he knows all too well that there is no going back. Additionally, for all the challenges we face in adapting to this new economy, there are many opportunities open to those who have the skills and courage to capitalize on these opportunities.

It used to be that hard work and loyalty to a company assured you of a secure middle-class lifestyle. This lifestyle was driven by the financial security offered by your job to buy a house in the suburbs and a car on time. The new economy is based on an entirely different foundation: those with specialized skills and knowledge will succeed.

Reich explains that the current changes in our economy are driven by technological advances. Geography is no longer a determinant of where we do business; the world is truly one big market now. There are cascading consequences of this phenomenon; since consumers have access to world-wide markets, they can easily search for the ‘best deal.’ In turn, businesses have had to adapt to this new reality. In adapting, businesses have been forced to enter the global marketplace which is characterized by niche services, intense competition and an ever changing environment. While we as consumers have a much more diverse marketplace, there are a number of unintended consequences. These include the outsourcing of many repetitive jobs, the lowering of prices for goods and the concomitant lowering of wages, increased productivity in businesses, and the death of businesses that could not or would not adapt to the new way of doing things. The recent discussions about the value and cost of the ‘walmartization’ of the marketplace reflect this dichotomy of the quest for lower prices and access to a broad array of goods and the toll this takes on our communities.

It is not just the marketplace that is changing though. The very nature of work is changing. Reich observes that our traditional employment arrangement of individual workers working in an organization and performing specific duties is disappearing. The new work arrangements are increasingly ad hoc teams. Fluid organizations form to perform a specific project with the leader of the project gathering resources as needed. Reich refers to this type of worker as the ‘shrinks’. Shrinks are described as those who can read a situation and bring together the human and material resources needed to complete the task. The other primary type of worker in this new arrangement is called ‘geeks’. Geeks have a specialized skill needed for a particular project. Geeks must constantly keep current in their technology field.

If Reich is correct in his observations about the changes in our workplace, then the implication is that our own way of working will change dramatically also. Specialty skills, niche services, contract work, flat organizations will characterize employment in this new age. Perhaps one of the most dramatic changes will be in how we are compensated. If our work world does transform into ‘ad hoc’ teams who are compensated by the project, this means the end of our pay system characterized by regular paychecks and expected raises and benefits.

For Extension educators, it is important that we recognize the changes being experienced by our clientele. We are undergoing a seismic shift in how our entire world operates. We can help our clientele understand these changes and point them in the direction of finding ways to adapt.

Nancy Kukay

While the nature of jobs in the United States has moved from an agrarian base to an industrial base, and more recently a knowledge-based economy, the way young people are prepared has not kept up with the pace of change. There is a disconnect between what young people are learning and need to learn, evident when employers report new entrants to the workforce are not prepared.

Companies are asking for young adults who have applied skills in communication, leadership, teamwork, and problem solving. Employers are reporting that young workers lack key skills and attributes necessary for success in today’s workplace. Thus, there is widespread concern that youth lack the skills necessary for success and are entering the workforce unprepared.

This concern will be compounded by shortage of workers. According to the Business-Higher Education Forum, the shortage of workers with some college level skills will be more than 12 million by 2020; with baby boomer retirements, employers must fill high-performance jobs. There are economic and social benefits to successfully filling these jobs.Countries that can produce and fill the faster-growing information and knowledge intensive jobs will innovate, thrive and grow in the global economy. And, for individuals, the stakes are high. Wages of workers with higher level skills are growing while those with low skills are declining. There is a growing gap between entry level service jobs and jobs requiring high levels of the applied skills described above. The traditional, well paid blue collar and administrative jobs such as automotive factory work are gone or quickly disappearing with job growth concentrated in higher-skilled occupations. This translates into earning power for individuals with higher skill levels and a dangerous decline for those without.

Ohio State University Extension, through its outreach efforts has an opportunity to partner with local communities and citizens to help with this issue. Learn more from future postings and my recent reading list:

• Building a nation of learners: The need for changes in teaching and learning to meet global challenges 
• Are they really ready to work? Employers’ perspectives on the basic knowledge and applied skills of new entrants to the 21st Century workforce
•  What work requires of schools: A SCANS report for America 2000 (15 years old but still relevant!)
• Work by Harvard and MIT Professors - Levy and Murnane or their recent book The New Division of Labor: How Computers are Creating the Next Job Market.

Posted by Graham Cochran