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Ioana Marinescu: So I’m a labor economist, and when thinking about this problem, I like to consider both labor supply and labor demand.
So a lot of the reason why middle-class jobs are disappearing has to do with new technologies that are replacing workers in these middle-class jobs.
So what do we do? We use technology as a response. In particular, you have to think about how to best match the training that workers receive with the skills that are in demand in the labor market.
I have looked recently at community-college students, who often do a lot of training that is short and is intended to be useful for the labor market. But very surprisingly, we found that those students have very little information about the labor-market outcomes. Meaning, for example, if this person has a job or not, whether they took this degree or that degree, if they took welding or English literature.
So my policy advice No. 1 is use technology to fight technology. So nowadays, we have more and more data. We have big data and we can use that data together with machine-learning technology to help students make an informed decision and better take into account the labor-market outcomes that they are likely to have if they graduate with different degrees.
And so this is something that can be thought of on a big scale, trying to smooth the transition between employment, job search, and education, so that whole pathway between education and work can be smoothed out through technology and the use of big data.
The second policy advice is to think again about labor supply. And this comes before college. So in my first point, I was talking about college, but what happens before college? We have to be prepared. There is a survey of adult skills, and US youths are the lowest down the rung in terms of numeracy and problem-solving.
And so if you have this issue, you need to double down on the financing of K–12 in order to push for math, science, problem-solving skills. In order to even be able to think about policy one, technology to fight technology, to bring that to scale, we have to have a workforce that is already prepared in K–12 with the right skills to go further.
Now, policy advice No. 3, that now looks at companies and employers and what can be done on that side. One really interesting fact about the labor market today is that it’s more and more dominated by megafirms, superstar firms that are enormous. And what is very interesting is that they also pay low wages.
And so there seems to be a link between concentration and the availability of good-paying jobs. Furthermore, another trend that’s been going on is the noncompete clauses. More and more workers are made to sign noncompete clauses, and so that’s a problem because that means workers are banned from accessing a lot of these good-paying jobs, and so that puts workers at a disadvantage in the labor market.
And so, in order to address that, we need to think about policies that encourage competition and discourage monopoly. And so, this bundle of encouraging competition and discouraging monopoly should stimulate the creation of good-paying jobs.
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