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A Decade Behind: Breaking Out of the Low-Skill Trap in the Southern Economy


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In order for the South to get out of the low-skill low-wage trap, it will need to invest in education and postsecondary training to break the cycle. We provide projections of education and employment containing a state-by-state analysis of 17 southern states through 2020.

Published in: Economy & Finance
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A Decade Behind: Breaking Out of the Low-Skill Trap in the Southern Economy

  1. 1. A Decade Behind: Breaking out of the Low-Skill Trap in the Southern Economy Anthony P. Carnevale and Nicole Smith July 31, 2012
  2. 2. Overview •  The South is a decade behind the rest of the country in the proportion of high-wage, high-skill, high- demand jobs that require postsecondary education •  While job growth in the South (20%) is relatively strong compared to the nation (17%), many parts of the region are trapped in low-wage/low-skill equilibrium cycle •  The South will need to invest in education and postsecondary training in order to break the cycle
  3. 3. Over time, the demand for postsecondary talent continues to grow, but the gap between the region and the nation remains.
  4. 4. Educational attainment levels are improving in the South, but the growth rate is declining •  Between 1970 and 2010, the demand for postsecondary education within occupations grew at an average annualized rate of 4 percent (compared to 3% for the nation) •  Between 2010 and 2020, the demand for postsecondary education within occupations is forecasted to grow at an average annualized rate of 0.6 percent (compared to 1% for the nation)
  5. 5. In 2010, the national average for postsecondary attainment was 59 percent. Fourteen southern states will still not have met this old target by 2020.
  6. 6. •  The southern employment profile in construction and in retail was artificially inflated prior to 2007 due to the financial bubble. •  The South is unlikely to see a full recovery in blue collar construction jobs and retail. •  Jobs in many southern states are concentrated in old-line industries like manufacturing and natural resources, where productivity gains will continue to have slow job growth. Jobs in the South requiring high school or less were lost in the recession and are not coming back
  7. 7. By education level, postsecondary credentials are concentrated below the BA for southern states.
  8. 8. •  Government, retail and healthcare will continue to be the biggest employers in the South •  The region is home to more than 41 percent (nearly one million) of the jobs in coal mining, natural gas and petroleum extraction •  Analysts predict these areas to be the fastest growing job-creators, but they only represent 3 percent of the jobs in the South in the coming decade Employment Trends
  9. 9. Cont. •  Government is the region’s top job provider, projected to grow 16 percent by 2020. •  Retail trade is the second highest, expected to grow by 13 percent by 2020, followed by the healthcare services industry, which will employ seven million people by 2020.
  10. 10. •  By 2020, 65 percent of all jobs in the United States will require some form of postsecondary education and training, while the South will require 57 percent •  Inadequate demand will ensure brain drain of postsecondary talent to neighboring states, especially from western Virginia and Louisiana •  A large share of the region will need an aggressive multi-dimensional strategy that mixes educational improvements with economic development Conclusion
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