Remember the skills gap? The good news is that employers are no longer complaining because they can't find enough skilled workers. But that's also the bad news. Workers' skills have not improved; instead, jobs are being dumbed down. This may seem like a sensible approach to a bad situation, but it will be a long-term disaster for our country, especially given the economic history of the last 15 years.
We're accustomed to thinking of the period from the mid-1970s to 1990 as a time in which the U.S. made a spectacular economic recovery. It brought our gross national product (GNP) to its highest point ever and saw the creation of 20 million new jobs. But Ira Magaziner, chairman of the Commission on the Skills of the American Workforce, which sponsored a study of the U.S. and six other developed nations, says these upbeat figures hide an unpleasant reality.
Our economy grew during these years-though not very much --partly because we had more people working: 50 percent of the adult population as opposed to 40 percent fifteen years ago. But wages in real dollars fell 13 percent. And, in the coming years, we will not be able to increase productivity by increasing the size of the workforce. We don't have a baby boom generation coming along, and there is unlikely to be a big increase in the percentage of women working.
Moreover, 70 percent of the increase in our GNP during this period came from money we brought into this country from abroad-from money we lent and borrowed and from U.S. companies we sold off to foreigners. Twenty percent of our industrial base is now owned by people who are not U.S. citizens (up from 5 percent in the early 1980s.) in contrast, for instance, to 2.5 percent in Germany.
So, according to Magaziner, the prosperity of this past 15 years was largely illusory; we've been living on borrowed time and borrowed money, and now we have to think of real ways to make our productivity grow. The best way to do that is to reorganize U.S. workplaces, but there are some enormous obstacles in the way.
Most of our workplaces are still organized on the assembly-line model. This has worked well for us in the past, but we are now competing with countries whose workers get one-quarter the wages of ours. If we continue with the assembly-line model, either the jobs will go to those countries or our workers will have to settle for third-world wages.
The answer is the step already taken in other developed nations and by a few top U.S. companies: reorganize the workplace around teams of workers, making each team responsible for an entire unit, whether that unit is a refrigerator or an insurance claim. This way of organizing work calls for workers to think and plan instead of just pushing buttons or tightening bolts. The payoff is more flexibility, better quality control and greater productivity.
Unfortunately, most American companies are moving in the opposite direction and trying to be competitive by dumbing down their jobs. They're employing low-wage temporary and part-time workers, who don't get fringe benefits or build up job seniority. The vast majority of companies surveyed by Magaziner's group were not interested in whether employees could think but in whether they would show up every day and have a good attitude.
Magaziner got an indication of just how far this movement toward dumbing down has gone when the Swiss president of a multinational company confided that his firm was beginning to organize its American plants just like ones in the third world, with simpler tasks than their European counterparts and lower wages.
It's not hard to see why companies that can't get skilled employees might adjust by deskilling their jobs, and it's not hard to see why schools won't produce skilled employees if no one wants them --we're in a chicken-and-egg situation. But whichever came first, the low-skills, low-wage solution will be disastrous for us all.
Magaziner has some proposals about how we can get out of this trap. In many other countries, there is a lot of pressure to succeed in school. We could put this kind of pressure on our students if we established a certificate of employability which required certain skills, and without which students could not work until they reached 18. And if the skills were benchmarked to world standards, the skills gap between our workers and those in the rest of developed world would diminish.
But skills training can't stop when our young workers are 18. In most other developed counties, employers are required by law train their employees or to pay a tax, so they can be trained by others. This system is expensive, but it won't cost U.S. employers more to train their workers properly than many of them now spend to deal with defective products made by poorly trained workers.
Solving our economic problems will require commitment from business and from education. We need an education system that will educate the overwhelming majority of our students to high standards but will not give up on the rest; we must be able to follow students with whom we have failed until they get the skills they need. But even if schools produce the most educated workers in the world, it won't do us any good unless our business leaders have a vision of what our country should be and unless they realize that adopting third-world standards to solve our productivity problems will lead to a third-world economy.