Solving Unemployment Doesn’t Have to Be a Partisan Issue

March 2014 unemployment data will be revealed on Friday, April 4. While the recession may have ended, the battle to create jobs has not ceased. As of February 2014, the unemployment rate remains at 6.7 percent, about 2 percentage points higher than the normal rate for an expanding economy.

In the meantime, propositions regarding the best method to solve unemployment remain stagnated: simply put, the same arguments are continually repeated without innovative approaches to tackle one of the most pressing matters of the decade.

Media outlets continue to rehash partisan-charged talking points about solutions to reduce the unemployment rate. In particular, one infamous talking point is to “promote small businesses.” Typically, when this argument is used, it offers no direction as to how small business creation can be achieved.

On the rare occasion that direction is provided, pundits argue that policies to provide tax incentives or reduce cumbersome regulations should be advanced as potential policy avenues for small business creation. In such a charged political environment, this argument then becomes subjected to partisan disputes and becomes deadlocked before it even gains momentum.

Perhaps even more disturbing is the ambiguity surrounding the unemployment rate itself. Out of the active labor force, which includes those 16 years of age or older, 6.7 percent remain unemployed. This 6.7 percent includes those within the labor force who are without a job and have actively sought employment in the last 4 weeks.

According to the Bureau of Labor Statistics, actively seeking includes sending out resumes, consulting with friends, and checking professional registers. However, the people excluded from this 6.7 percent are those who have left the labor force. For the concerns of unemployment, this includes those who have not actively sought employment in the last 4 weeks. This notion does not seek to criticize the statistic, but rather raise alarm to an issue with labor force training.

Policies to reduce unemployment have traditionally focused on how to increase labor demand. In other words, they typically highlight methods to create jobs. Little attention has focused on improving the quality of the labor supply. This includes skills training to make job seekers more competitive in the labor market, which consequently improves the quality of the workforce.

Long-term improvements to the U.S. workforce can be made by shifting the policy dialogue from labor demand to supply.
Clay Moran
Such a process, coined Workforce Development (WfD), has been particularly popular when considering the rising youth unemployment in Arab countries. A more specific approach is called Education for Employment (E4E), which provides job-seekers the skills they need to be hired.

By shifting policymakers’ attention to developing a competent and skilled workforce, measurable results can indicate the success of given policies.

Specialized training programs that fall under E4E help job-seekers develop skills that the workforce demands. Such trainings may focus on Information and Communication Technology (ICT) or Vocation, Education, and Training (VET). They educate job-seekers in valuable and transferable skills, which over the long-run will reduce unemployment and improve the labor force.

By shifting the policy dialogue from increasing the labor demand to providing specialized skills training to the labor supply, long-term improvements to the U.S. workforce can be made. While results may not be immediate, training programs provide the labor force with transferable skills and establish a more advanced workforce.

Photo Credit: The Star-Ledger