The Problem With ‘In Demand’ Jobs
Even in the 1990s, at the peak of free-trade fever in Washington, Congress knew that globalization would be rough on some folks. Opening the economy up to cheap imports from Canada, Mexico, and China was bound to undercut domestic industries and cost many American workers their jobs. On top of that, welfare reform eliminated or sharply cut benefits for many families. To soften the blow, Congress offered one of its favorite solutions: federally funded job training to help laid-off workers and destitute parents find a new source of income.
It made sense in theory. Manufacturing workers would “re-skill” for the Information Age economy—perhaps moving from the factory floor to an exciting career in, say, computer science—and impoverished moms would get a hand up instead of a handout. In practice, it was a failure. A 2017 study by Mathematica Research compared people who had received job training under the 1998 law, now known as the Workforce Innovation and Opportunity Act, with a randomly selected control group. Thirty months later, the training had zero effect on earnings.
In 2022, the U.S. Department of Labor published a comprehensive study of the WIOA and a host of similarly structured federal job-training initiatives. The programs did manage to put a lot of people through training, the researchers found. And many of those people were then hired in so-called in-demand jobs. But in the first three years after training, their wages increased only 6 percent compared with those of similar workers who didn’t receive training—from an average of about $16,300 to $17,300 a year—and the effect didn’t last. In the long term, their relative wages didn’t increase at all.
[Read: The false promise of worker retraining]
This poor track record is often attributed to ever-growing skill requirements for jobs in the fast-paced global economy. In fact, the programs fail because they’re designed with potential employers rather than employees in mind. In the case of the WIOA, the local workforce boards that decide which jobs qualify as “in-demand,” and therefore which are eligible for federal funding, are dominated by business interests—and what business wants is a steady stream of low-wage workers trained by someone else.
“In-demand” jobs aren’t necessarily good jobs. They might be the opposite, because, from an employer’s perspective, “in-demand” is another way of saying “lots of vacancies,” and sometimes employers can’t fill jobs because they expect grinding, potentially dangerous work in exchange for bad pay, meager benefits, and little room for advancement. In 2022, for example, the U.S. Department of Agriculture issued a $25 million grant for meat-and-poultry agriculture-workforce training. The poultry industry, which is notorious for its unsafe working conditions, has so much trouble finding workers that it sometimes relies on migrant child labor. A 2023 New York Times investigation found that Virginia chicken factories had employed migrant children to clean “blood, grease, and feathers from industrial machines.” (The factory owners denied knowledge of child labor. In response to the Times article, Hobart “Hobey” Bauhan, the president of the Virginia Poultry Federation, suggested that federal immigration officials were to blame for allowing migrant children into the country in the first place. Bauhan is also the chair of the state committee that sets performance standards for Virginia’s job-training programs.)
The most common WIOA training program, by far, is truck driving. From 2022 to 2023, more people completed trucker training through the WIOA than for the next nine job categories combined. Although the trucking industry has argued for decades that it faces a shortage of drivers, its hiring difficulties are arguably a function of brutal working conditions that make it difficult for trucking companies to retain their workers, resulting in annual turnover within the industry above 90 percent. Trucking firms operate this way because it’s more profitable to just keep hiring new drivers. WIOA training programs—many of which are measured in weeks, not months—provide a steady stream of workers to churn through.
The law’s defenders claim that WIOA-style training programs really do steer graduates into good jobs. They point to seemingly successful programs that train “certified nursing aides” in as little as six weeks. Certified nursing aide does sound like the entry point to a solid middle-class health-care profession. It’s not. Only 6 percent of low-income people who went through a federally funded CNA training program from 2015 to 2021 advanced up the nursing career ladder, according to an Urban Institute study. Many earn near-poverty wages.
A better way to think about certified nursing aides is as a cheaper alternative to actual nurses, who command high salaries. Many CNAs work in nursing homes and assisted-living facilities, a growing share of which are owned by private-equity firms focused on generating short-term profits by slashing costs. Elder-care investors can maintain large profit margins by keeping facility staffing levels and salaries low, but that leads to burnout and turnover. It is very much in their interest to have a steady supply of new CNAs for these “in-demand” jobs.
Unfortunately, Congress is currently considering a pair of bipartisan updates to federal job-training that would double down on the WIOA’s shortcomings. In April, the House of Representatives passed a new version of the law by a 378–26 vote, giving a bipartisan stamp of approval to the failed status quo. Meanwhile, a Senate bill introduced by Democrat Tim Kaine and Republican Mike Braun, with dozens of co-sponsors, would allow federal Pell grants for low-income students to be spent on short, WIOA-style training programs instead of on traditional college degrees. Taken together, the bills, if they become law, seem poised to expand the federal government’s investment in funneling unemployed workers into low-wage, high-turnover jobs.
[Read: Why is the US so bad at worker retraining?]
If Congress wanted to actually fix the broken system, it would make sure that federal training programs prepare workers for jobs with living wages, benefits, and the opportunity for career advancement. Some models exist at the state level. California’s state-funded High Road Training Partnerships initiative, for example, matches workers with employers who meet standards for wages and job quality, and who commit to collaborating with workers in the design of their training programs. Many of the jobs are unionized. The UC Berkeley Labor Center studied one High Road program developed in collaboration with major health-care providers and the statewide health-care workers’ union. It found that workers who came through the program were 40 percent more likely to get promoted, with an average wage increase of 36 percent.
Labor unions are the one force that might be able to persuade Congress to reform the WIOA system instead of doubling down on it. Last month, the AFL-CIO sent a letter to Bernie Sanders in his capacity as the chairman of the Senate Committee on Health, Education, Labor, and Pensions, demanding changes to the House bill. Jody Calemine, the union’s director of advocacy, told me that the legislation should give workers equal power with businesses in running local workforce boards, and ensure that the WIOA trains people for authentically high-quality jobs. Whether union advocacy succeeds at changing the bill will shed light on just how reinvigorated the American labor movement is.
The 1990s approach failed to achieve its stated goal because its focus on short-term training for “in-demand jobs” was always designed to benefit employers, not workers. The Biden administration has pushed an expansive agenda to support unions, expand antitrust enforcement, and give workers more power to demand better wages and benefits. A newer, better WIOA could bring job training in line with those ideals.