For many Americans today, work does not pay enough. The costs of housing, health care, transportation, child care, and education have risen while wages have stagnated, leaving many working families struggling. Roughly one in four working adults earns a wage that is insufficient to lift a family above the poverty line. Nearly one in five working people receives the Earned Income Tax Credit (EITC). More than a third of college graduates work in jobs that do not require a college degree.
Education and training are offered as solutions to help low- and moderate-income individuals succeed. Rather than providing cash or in-kind assistance to help people meet their current consumption needs, the thinking goes, it would be better to give them the skills so that they could earn more. Here is the problem: Education alone cannot create more “good jobs,” and without good jobs, the system will continue to struggle.
Our education system itself cannot function properly if working families cannot support themselves. The US education system’s structure is heavily dependent on the family — we depend on families to prepare children to start school and to support children’s education by participating in parent-teacher associations, attending parent-teacher conferences, or just helping with homework. We also depend on working parents to pay the taxes needed to support their local school systems. But too many working parents have jobs and incomes that work against their efforts to play these roles. Before children even get to kindergarten, the resulting disparities in school readiness are evident. Today, far too many children arrive at the public education system unready to learn and needing too much help from school systems with too few resources to adequately meet their needs. These educational challenges are not a result of parents’ unwillingness to work, but because of the quality of work available to them.
Businesses and policymakers both have roles to play if we are to increase access to and availability of good jobs and a capable workforce prepared to do those jobs. First, the job of skills development does not rest solely with schools or training organizations. Workplaces themselves are a critical place where people learn job skills — both through formal workplace training programs and through the experience gained at work. Businesses should consider how they structure work, offer opportunities for learning and growth, provide quality performance management and supervision, and reward learning, perseverance, and hard work. Intentional human capital investment choices can lead to both better jobs and better business performance.
Business leaders need encouragement to make better choices. Public policy and public statements matter. Public policy sets the framework within which businesses compete. It is the job of government to set standards in our market economy to protect the interests of all market actors — businesses, investors, customers, and workers. Promoting safe workplaces, adequate compensation standards, and access to information about employment practices so that workers can make informed choices about jobs are important government roles that help labor markets function. It remains to be seen whether today’s economic policies — which protect profits but do little for paychecks — can foster a robust, growing economy with shared prosperity, a basis for a strong and stable society.
Today’s stagnant wages have left many families struggling, and education is at best a partial answer. The education system itself is struggling because of the declining returns to work; it is not capable of being the solution to the lack of good jobs in America. To support working families, we need to think beyond training and education. We need to advance systemic changes that increase access to and availability of good jobs because when Americans have good jobs they create stable families, strong communities, and prosperous economies. Business leaders, policymakers, philanthropists, and change agents from civic and social agencies can all play important roles in addressing this urgent need.