Table of Contents
Executive Summary .................................................................................................... iii
The Changing Economy............................................................................................... 1
Changing Skill Requirements for Existing Jobs ........................................................ 2
Changing Skill Requirements for New Jobs................................................................ 4
Employers and Workers Benefit from Investing in Education and Training ............. 6
Employers Benefit from a Skilled Workforce .............................................................. 7
Employees Benefit from Education and Training........................................................ 8
Foreshadowing the Challenges ................................................................................. 12
Education and Training of the Workforce ................................................................. 13
Providers of Workforce Education and Training........................................................ 14
Educational Institutions ........................................................................................... 14
Employers .................................................................................................................. 15
Labor Unions.............................................................................................................. 16
The Public Sector ...................................................................................................... 17
Participants in Education and Training .................................................................... 19
Next Steps: Challenges and Opportunities.............................................................. 20
Workers....................................................................................................................... 20
Employers................................................................................................................... 21
Educational Institutions............................................................................................. 21
Promising Partnerships and Programs: Examples from Across the United States.. 23
Endnotes ..................................................................................................................... 35
Bibliography................................................................................................................ 41

Executive Summary

Global competition, the Internet, and widespread use of technology all suggest that the
economy of the 21st century will create new challenges for employers and workers.
While it is possible to compete in this new global economy by creating low-wage, lowskilled jobs, America has chosen to take full advantage of its labor force and to create
high-performance workplaces. If economic success is to ensure a high quality of life for
all Americans, it will require adopting organizational work systems that allow worker
teams to operate with greater autonomy and accountability. These new forms of
organization and management cannot succeed without additional investments in the skills
of U.S. workers. In the workplace of the 21st century, the Nation’s workers will need to
be better educated to fill new jobs and more flexible to respond to the changing
knowledge and skill requirements of existing jobs. Meeting the challenge of employment
and training will call not only for the best efforts of employers, educators and trainers,
unions, and individual Americans, but also for new forms of cooperation and
collaboration among these groups. Lifelong skills development must become one of the
central pillars of the new economy.
With this responsibility comes enormous opportunity. Not only does a better educated
and trained workforce create significant productivity gains and better bottom line results
for American employers, but the more a worker learns, the more a worker earns. A
multitude of data demonstrate that greater education and training pay. For example:

• Employers that provide formal training for their employees see a 15 to 20 percent average increase in productivity.
• Workers with more education earn higher wages. On average, college graduates earn77 percent more than individuals with only a high school degree.
• Workers with more education enjoy greater benefits, experience less unemployment, and, when dislocated from their jobs, find their way back into the workforce with much more ease than those with less education. For example, dislocated workers with a high school diploma spend nearly twice as long to find a new job as a worker
  with an associate’s degree.

The good news is that society is responding, and education and training is increasing:

• More than 57 percent of business establishments report that since 1990, the amount of formal education they provided has increased while only two percent report a decrease.
• Unions are increasing their commitment to workforce education and training, increasingly seeking joint union-management training initiatives; and more unions, district councils, and locals are creating training funds for their members.
• From 1980 to 1995, enrollments at community colleges, which play a special role in serving the needs of an older, employed student body, increased by 21 percent, due mostly to part-time students.
• The Federal government has made education and training a top priority, increasing investments in new programs and public resources, such as Hope Scholarships, Lifetime Learning Tax Credits, expanded Pell Grants, the Workforce Investment Act, and One-Stop Career Centers. These innovative efforts are designed to make
  education and training accessible, affordable, and convenient for all Americans.

But, as a nation, there is still more work to be done to increase lifelong learning and skills development for all American workers, particularly for those who are starting with less education or employment experience.

• More than 90 million adult Americans have low levels of literacy. These individuals are not well-equipped to meet the challenges of the new economy and compete with workers of nations with higher literacy rates than the United States.
• Those in most need of skills upgrading often go without. Nearly 90 percent of those with at least a bachelor’s degree receive formal employer-provided training compared with 60 percent of those who have a high school education or less.
• While the benefits from workforce skills development are clear, there are a variety of challenges that inhibit a greater investment in skills development. Often the fear of employee turnover and high training costs, particularly for small firms, serve as disincentives to employers seeking to invest in workforce education and training.
  Additionally, workers face a variety of constraints, such as a lack of time, money and information which impede their efforts to continue learning throughout their lives.
  

America is on the verge of a promising — but also challenging — set of new economic opportunities. In the 21st century, American competitiveness and worker prosperity will be tied tightly to the education and skill attainment of the workforce. Recognizing that no one can be left behind, it is incumbent on everyone — employers, educators and
trainers, unions, workers, and the government — to build aggressively and purposefully upon the Nation’s progress. Dynamic partnerships are essential to ensuring that all Americans have affordable and convenient access to acquiring skills for the 21st century economy. The economic health of the Nation and individual well-being rest on the success of this team effort.

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