American youth: Digitally skilled and unemployable.

According to conventional wisdom, technological advances and globalization mean that jobs are disappearing for people with outmoded skills and that new jobs are being created that require new skills. Americans whose jobs are offshored should retrain for the jobs of today and tomorrow. America will fall behind in the global competition without better and universal education to teach the skills necessary for the modern jobs that are being created in America.

Specifically, it is often said that the internet has changed everything, and that being comfortable with the paperless, wireless, digital, global, online, lightning-fast, on-demand, information age is the key that unlocks the door to modern jobs. American youth are notoriously proficient in these skills, and those over 55 are notoriously lacking in these skills and resistant to acquiring them. It follows that as industrial age jobs are disappearing and information age jobs are being created, young workers will fit right in and older workers will be left in the unemployment lines. In fact, however, there has been a strong trend in the opposite direction.

The employment-population ratio for 16-24 year-olds started declining in 2000—just as we were all getting computerized and networked. Meanwhile the employment-population ratio for those 55 and older has been increasing since 1993. In the Great Recession, youth employment has been devastated and mature worker employment has hardly been affected at all. If these trends are being driven by skills, conventional wisdom must be wrong about what skills are needed and the importance of education. More likely, it hasn't been a skills story but one about the advantages of incumbency and the need of older workers to keep working as retirement benefits have declined.

And let's do remember this. American jobs were not moved to Chindia in the last decade because the Chindians have better skills. That happened—and is continuing to happen—because Chindian workers are cheaper. Full stop. We've been emphasizing education and skills development in America for decades, and there is nothing apparent in the current emphasis that seems likely to change our output of skilled workers. Nor does the historical record indicate it would contribute much to domestic job creation if we did have more skilled workers. Skilled Chindians will still be cheaper, and young Americans will still be living with their parents as long as that's true.

Update on Tuesday, June 21, 2011 at 03:55PM by Skeptic

I've had questions about the increasing employment-population ratio for those 55+. So I separated the 55-64 group from the 65+ group.

Obviously, the percentages in the 65+ group are lower, but they follow the same pattern of decreasing to about 1984 and then increasing until 2008. But why? Looking only at the 55-64 group, there is a radically different pattern between men and women. Both of the following images are generated by the BLS labor force statistics in the Current Population Survey database, men first and then women:

What's interesting is that men 55-64 dropped out of the labor force in large numbers from 1970 to 1984, while women maintained their same participation rate during this period and then resumed their rapid rate of increase. What explains this?

Comments

[Katharine]

What's the data on college major and employment rate?

[Skeptic]

Katharine, take a look here. http://www.realitybase.org/journal/2011/5/20/we-probably-need-better-college-graduates-but-we-certainly-d.html