Center for Business and Economic Research - Ball State University


CBER Data Center
Projects and PublicationsEconomic IndicatorsWeekly CommentaryCommunity Asset InventoryManufacturing Scorecard

About

Commentaries are published weekly and distributed through the Indianapolis Business Journal and many other print and online publications. Disclaimer

RSS Feed

Disclaimer

The views expressed in these commentaries do not reflect those of Ball State University or the Center for Business and Economic Research.

Recent

Increasing Importance of Summer JobsThese jobs offer an opportunity to learn as well as earn money.

Educational Attainment, the 21st Century Fund and the Future of SchoolingIndiana ranks 42nd in educational attainment.

Big Savings for Ending Prevailing WageMy statistical models show that repealing state prevailing wage laws save taxpayers money.

Re-Thinking Economic Development A large share of the most mobile families—perhaps half—no longer need to live near where they work.

View archives

Top Tags

jobs and employment 231
economics 178
education 149
economic development 146
state and local government 129
taxes 123
finance 109
indiana 106
migration and population change 104
budget and spending 104
Browse all tags
Reporter / Admin Login

February 3, 2019

Another Brookings Study Marks Indiana “at Risk”

Last week the Brookings Institution released yet another study that should be read aloud in every Hoosier school, city council and in the General Assembly. This study was an examination of the automation risks to employment across the nation. It is worth discussing the findings, with a focus on what is currently happening in Indiana to address this problem. 

Faithful readers of this column will find some of the Brookings work familiar. Using different data sources, the Brookings study makes almost exactly the same claims my Center reported in our 2017 study of vulnerable communities. Both studies reported that Indiana faces enormous risks of automation-related job losses. Indeed, Indiana the most ‘at risk’ state in the Union, with perhaps half of all jobs facing dislocation within a generation. 

Both studies are nuanced, explaining that automation replaces some human tasks, but also creates demand for workers in different occupations with different skills. It is very clear from both studies that automation-related job losses will be concentrated among the lesser skilled workers, while new job opportunities come among the better skilled and more adaptable workers. The new tasks are mostly covered in four-year colleges, while the adaptability skills are the product of strong elementary education. Maybe the best illustration of how this is already playing out across the nation comes in a review of what has been happening in US labor markets for the last decade.

The Great Recession dramatically disrupted labor markets. Because the nation as a whole improved its level of education, this long recovery has made the nation more resilient and workers generally less at risk from automation. Across the US, the share of adult workers aged 25 or higher holding a bachelor’s degree rose by an astonishing 3.9 percent, while roughly 75 percent of new jobs went to workers with a four-year degree or higher. In contrast, less than 20 percent of job gains went to workers with an associate’s degree or some college training, and only 6.5 percent of new jobs went to a high school graduate. Nationwide, workers without a high school diploma have seen job losses since the end of the recession. 

Nationally 41.3 percent of workers aged 25 and older hold a bachelor’s degree, up from 37.4 percent in 2009. This is a critical improvement in our nation’s long-term economic health, since better-educated workers are far more likely to adapt smoothly to the effects of automation. Moreover, an abundance of high-skilled workers actually improves the labor market prospects of less-skilled workers. 

Indiana’s story is much different. Since the end of 2009, the share of Hoosier workers holding a bachelor’s degree has actually declined by 1.3 percent to 23.3 percent. However, the data is even more worrisome at other levels of educational attainment. Unlike the nation as a whole, the biggest share of job gains in Indiana came to workers without a high school diploma. Across all education categories, college graduates saw the worst recovery in terms of numbers, though the best in terms of wage growth. 

The plain and ugly fact is that over this long economic recovery, Indiana’s work force actually down-skilled for the first time in our more than 200 history. To put it in stark terms that most Hoosiers will find disquieting, our workforce is now less well-educated than is Kentucky’s. 

There are many causes for this, too many to cover in a single column. I’ll have to write more about in the future. What should now be clear to everyone is that this is a looming calamity for Indiana. Most troubling, today our education and workforce policies take little notice of an issue that has captured the national attention for years. One consequence of largely ignoring this problem is that over the past several years our workforce and education policies have increased our vulnerability to job losses. By weakening the college preparatory focus, and shifting funding away from K-12, we have created a workforce less well-prepared for disruptions than they were a decade ago. The final takeaway is that when Kentucky is outperforming your state in human capital policies, it is time to do something different.

Link to this commentary: https://commentaries.cberdata.org/988/another-brookings-study-marks-indiana-at-risk

Tags: workforce and human capital, education, jobs and employment


About the Author

Michael Hicks cberdirector@bsu.edu

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Hicks earned doctoral and master’s degrees in economics from the University of Tennessee and a bachelor’s degree in economics from Virginia Military Institute. He has authored two books and more than 60 scholarly works focusing on state and local public policy, including tax and expenditure policy and the impact of Wal-Mart on local economies.

© Center for Business and Economic Research, Ball State University

About Ball State CBER Data Center

Ball State CBER Data Center is one-stop shop for economic data including demographics, education, health, and social capital. Our easy-to-use, visual web tools offer data collection and analysis for grant writers, economic developers, policy makers, and the general public.

Ball State CBER Data Center (cberdata.org) is a product of the Center for Business and Economic Research at Ball State University. CBER's mission is to conduct relevant and timely public policy research on a wide range of economic issues affecting the state and nation. Learn more.

Terms of Service

Center for Business and Economic Research

Ball State University • Whitinger Business Building, room 149
2000 W. University Ave.
Muncie, IN 47306-0360
Phone:
765-285-5926
Email:
cber@bsu.edu
Website:
www.bsu.edu/cber
Facebook:
www.facebook.com/BallStateCBER
Twitter:
www.twitter.com/BallStateCBER
Close