Heather Boushey, Chief Economist, Investing in America Cabinet and
Harin Contractor, Director for Labor Policy, National Economic Council
Today, the Biden-Harris Administration released a playbook on evidence-based workforce development strategies that state and local governments can use to support workers, families, and communities. After decades of jobs shipped overseas, communities hollowed out, and supply chains broken, President Biden’s economic vision—Bidenomics— goes back to what built the American middle class by growing the economy from the middle out and the bottom up.
The President is growing the economy from the middle out and bottom up by investing in America, supporting 21st century industries like semiconductors and clean energy; empowering and educating workers; and fostering fair and competitive markets. This agenda is a growth agenda, designed to deliver strong, stable, sustainable, and shared economic growth. And it’s designed to create jobs across the country, including in communities that have been too often left behind. External estimates predict that over the next decade, the Administration’s Investing in America agenda will create more than a million jobs in industries like manufacturing and construction. Already, investment in constructing new manufacturing facilities has skyrocketed.
With the President’s investments helping to build entire new industries in the United States, it’s to be expected that the entire workforce needed to fill those jobs isn’t already standing at the ready. That’s why the Administration is investing and scaling quality training efforts like Registered Apprenticeships—but training alone will not ensure a stable supply of skilled workers. The President believes that employers should prioritize ensuring that jobs are high-quality—including offering fair pay and benefits and quality working conditions—in order to attract and retain workers.
The challenge is that decades of offshoring, wage stagnation, lack of benefits, and increasingly aggressive anti-union activity on the part of some employers have left most workers without a sufficient support system to advocate for better benefits, safety, and voice. This has reduced the quality of jobs, including in construction and manufacturing industries.
Reduced union density and lower job quality can have repercussions for hiring and retention. In the construction industry, trainees who leave cite a number of issues, including being on call and dealing with unpredictable schedules; low pay and poor management; not enough time for training; little attention to work-life balance; and a lack of health insurance in a hazardous industry. Likewise, in manufacturing, one survey conducted before the pandemic indicates that most manufacturing firms were concerned about difficulties with hiring and the loss of institutional and technical knowledge as older workers leave the industry.
As the Council of Economic Advisers laid out in a brief last year, by improving job quality, employers can more easily attract and retain workers—benefitting their bottom line. At the same time, improved job quality enables workers to bring home the pay and benefits that provide an opportunity to reach the middle class, which in turn supports economic growth. Paying workers fair wages and providing benefits like paid leave can increase productivity, reduce turnover, and facilitate hiring and retention. Providing childcare lowers turnover while increasing the likelihood that parents can invest in training or additional education and work (especially full-time). Manufacturing firms that focus on job quality, like increasing pay and providing avenues for workers to have inputs into the firms’ practices, are better able to attract skilled workers, experience lower turnover, and higher productivity.
Similarly, unions are already playing a central role in developing and training the workforce for the President’s investments in America. And firms that allow unions to form uninhibited send a message to potential employees that the employer will value their work and that they can be confident in a stable, steady job that they can raise as family on.
While the federal, state, and local governments can help ensure job quality standards, employers themselves play a large role in lifting up good quality jobs. A key component of Bidenomics is helping employers create the conditions to attract and retain the skilled workforce they need. As Treasury Secretary Janet Yellen has laid out, the Biden-Harris Administration has put in place a “modern supply side” set of policies—policies that encourage private sector actors to take the high road, by creating high-quality jobs that provide dignity and enabling more workers to participate in the workforce. This means investing in job quality by supporting strong and stable economic growth, implementing labor standards around worker protection, and prioritizing worker empowerment and unionization.
This is why employers who pay prevailing wages for new clean energy projects and use Registered Apprenticeships—earn while you learn training efforts—to train skilled workers will receive enhanced tax credits up to five times the base value for specific credits.
Additionally, earlier this year, the President laid out a Roadmap to Support Good Jobs that outlined the Administration’s efforts to ensure America’s workers can access quality jobs from our historic investments. By investing $500 million in less than four months toward worker-centered sectoral training efforts, significantly Registered Apprenticeships in the Trucking and Cybersecurity, and investing over $200 million in training grants for infrastructure related jobs, the President is making sure we have strong pathways to quality jobs.
In the first comprehensive regulatory review in nearly 40 years, the Department of Labor has updated the Davis-Bacon regulations to strengthen and streamline the process for setting and enforcing wage rates on federally funded construction projects. And this month, the National Labor Relations Board issued a decision announcing a new framework for union representation proceedings—where if an employer commits any unfair labor practices during a representation election, the Board will order the employer to recognize and bargain with the union, rather than re-running the election.
While the Administration is setting up the essential training infrastructure needed for our in-demand jobs, employers should be part of the solution as well by investing in workers and improving job quality. When an employer or an industry is well known for high job quality, applicants will beat a path to the employer’s door. On the other hand, if an employer or industry has a reputation for low pay, unsafe conditions, and precarious work, it will have a hard time attracting a skilled team.
Quality jobs will ensure the benefits of the President’s Investing in America agenda are shared by all Americans, and that today’s investments lead to lasting, durable industries and long-term shared economic growth.