The Great Recession of 2008 had the greatest impact on workers without a postsecondary credential. This group of workers experienced the most job losses as a result of the financial crisis and benefited the least from the economic recovery that followed, leaving millions of Americans behind. America is once again experiencing a major economic crisis brought on by COVID-19 (coronavirus). However, history does not have to repeat itself. Significant investments must be made in Career Technical Education (CTE) to help ensure all Americans can be a part of the post-coronavirus economic recovery.
The Georgetown University Center on Education and the Workforce has documented the impact of the Great Recession in a 2016 report America’s Divided Recovery. According to the report, the Great Recession claimed 7.2 million jobs, more than three-fourths of which belonged to workers with only a high school diploma or less. As the economy rebounded to near-record low unemployment in the decade that followed, those same workers without any postsecondary credentials were unable to reap the benefits, regaining only 80,000 — or less than one percent — of all jobs lost. The report cites structural changes in the U.S. economy over decades, including a significant decline in the production economy coinciding with an ever-evolving knowledge economy, as underlying root causes to the inequitable economic impact of the Great Recession. Additionally, the industries hardest hit by the Great Recession were jobs that workers without postsecondary credentials relied on most, such as construction, manufacturing, and office and administrative support. Another factor cited in the report is that the industries that traditionally employed large numbers of workers without a postsecondary credential are increasingly turning to workers with more than just a high school diploma.
America’s Divided Recovery demonstrates the importance of postsecondary credential attainment in an economic recovery. A 2019 report by New America, Estimating the Impact of the Nation’s Largest Single Investment in Community Colleges, also underscores the point and illustrates the important role that CTE — provided by community colleges, technical colleges and career centers across the United States — play in reskilling and upskilling the workforce. The report presents the results of a meta-analysis of quasi-experimental evaluation studies designed to estimate the impact of Trade Adjustment Act Community College and Career Training (TAACCCT) grants on student completion, credential attainment, post-training employment and pre- to post-training wage changes.
TAACCCT, which was enacted in 2009, was described by New America as an unprecedented federal investment in postsecondary education and workforce training, with nearly $2 billion in grants committed to 729 colleges and universities — including 630 community colleges. Recipients of the grants were tasked with updating or implementing new programs of study “using evidence-based innovations and strategies to increase the capacity of colleges to deliver more and better integrated postsecondary education and workforce training.” The meta-analysis found that, on average, TAACCCT grants had statistically significant and positive effects on participants who participated in the renewed or newly-created programs. Positive outcomes included increased credential attainment and employment outcomes and, to a lesser extent, pre- to post-program wages. Ultimately, TAACCCT benefitted over 500,000 students who enrolled in nearly 2,700 new or redesigned programs and earned more than 350,000 credentials. The most popular career pathways were manufacturing and healthcare, followed by energy, information technology, transportation and logistics, green technology and agriculture.
The present economic crisis brought on by the coronavirus is similarly having a detrimental impact on workers without postsecondary credentials. Since the crisis began in early March 2020, unemployment for U.S. workers with less than a high school diploma peaked at a staggering 21.2 percent before leveling off at 15.4 percent according to the July 2020 Bureau of Labor and Statistics data. Those with only a high school diploma fared somewhat better, peaking at 17.3 percent unemployment before leveling off at 10.8 percent. Meanwhile, workers with postsecondary credentials less than a bachelor’s degree and those with a bachelor’s degree or greater peaked at 15 percent unemployment and 8.4 percent respectively.
Once again, the importance of postsecondary credentials is apparent as the workers who had some formal education beyond high school were impacted the least by the coronavirus-driven economic crisis and are rebounding the fastest. Any post-coronavirus economic recovery must include significant investments in postsecondary CTE and credential attainment so that no American is left behind.
Brian Robinson, Policy Associate