jobs

Support for small companies has long been a pillar of federal and state policies meant to drive business formation, job creation, and the resulting spillover economic benefits for regional economies. The debate remains, however, about whether smaller or larger businesses play an outsized role in the nation’s economy. This edition of Useful Stats provides some context to the argument, finding that although smaller and newer establishments accounted for the greatest amount of total job creation, job losses from small business closures reduced the group’s net job creation significantly, leaving larger companies to account for the greatest share of net job creation in 2019.

The findings from a recent webinar and report suggest that Employment Social Enterprises (ESEs) are significant market-based mechanisms that can address workforce misalignment by supplying employers with skilled workers while increasing economic mobility and addressing structural employment barriers. Business for Impact at Georgetown University’s McDonough School of Business recently delivered the webinar and report on Jobs for All: Employment Social Enterprise and Economic Mobility in the United States.

New York City and the state of Illinois have both made moves recently to shift more of their economies to clean energy. Mayor Bill de Blasio and the New York City Economic Development Corporation (NYCEDC) announced a 15-year, $191 million Offshore Wind Vision (OSW) plan to make New York City a leading destination for the offshore wind industry.  Last month, Illinois Gov. J.B. Pritzker signed sweeping legislation offering new incentives for the adoption of clean energy and aim to move it to 100 percent clean energy by 2050. And Massachusetts Gov. Charlie Baker is looking to use American Rescue Plan Act (ARPA) money to establish a clean energy investment fund.

Understanding the industry-level dynamics of business and job creation can help pinpoint which industries in regional economies may be hotspots for innovation activity. This edition of Useful Stats builds on previous SSTI analysis of business and job creation by state and examines data from the Census Bureau’s recently updated Business Dynamics Statistics (BDS) on net establishment and job creation in 2019 at the state and industry levels. The data serves as a useful baseline of where the economy stood prior to the pandemic’s start in 2020. While the national data shows that five industries experienced net establishment losses in 2019, industry trends at the state level vary widely with some states seeing losses across many industries while others experienced losses in only a few. There were also similar national- and state-level trends in net job creation in 2019. This analysis also provides additional context by examining the long-term state trends in these metrics from 2005 to 2019.

The May jobs report that was released last Friday contained better news than the disappointing numbers from April, with May figures showing 559,000 jobs added and unemployment declining by 0.3 percentage point to 5.8 percent. But the jobs picture remains complicated. This week, the Bureau of Labor Statistics (BLS) reported that there were 9.3 million vacant job openings across the country in April, a series high from its start in 2000. With employers reporting that they are facing unprecedented challenges trying to find workers to fill jobs, efforts on several fronts are aimed at returning workers to jobs, and helping them find the skills they need to fill in-demand openings.

Discussions surrounding automation’s power and the effect it could have on jobs have only increased over time. The current pandemic adds to the debate of whether automation and robotics, which are unaffected by viruses and have the potential for cost savings, could offer a safer bet for industries than human labor. Such are the debates the authors of a new working paper considered in their research examining jobs that were identified in the past as being at risk of elimination through automation. While building on previous studies from the Organisation for Economic Cooperation and Development (OECD) of the impact of automation on jobs, OECD authors Alexandre Georgieff and Anna Milanez seek to expand that knowledge to a cross-country context and the paper claims to be the first to evaluate employment outcomes using the task-based measure of automation risk developed by the OECD. The researchers found no support for net job destruction at the broad country level. However, they did find evidence that automation has worsened employment prospects for some workers including skilled agricultural workers, clerical support workers, and metal and machinery workers.      

Ohio’s governor and other state leaders this week announced the creation of a new Cleveland Innovation District, with the state of Ohio, through the Ohio Development Services Agency (DSA), JobsOhio and the Cleveland Clinic committing a combined $565 million to the new district. The new district will bring together Northeast Ohio’s leading healthcare providers and education institutions with the goal of creating a pathogen center with global reach. DSA is committing to $155 million, $100 million will be in the form of a loan, the terms of which are still being finalized, and an estimated $55 million in Job Creation Tax Credits (JCTC) over a 15-year period. JobsOhio will invest $110 million and an additional $300 million will be invested by Cleveland Clinic.

After two years of research on technology and jobs, MIT’s Task Force on the Work of the Future has issued its final report, and the news is hopeful: with better policies in place, more people could enjoy good careers even as new technology transforms workplaces.

New analysis from the World Economic Forum (WEF) forecasts an 85 million global loss in jobs by the year 2025 due to pandemic-induced increase in technology adoption. While social distancing measures such as remote work have already brought many white collar workers into the “future of work,” the quickened pace of technology adoption and automation across all sectors will create greater employment challenges for lower paid and lower skilled workers. The WEF’s Future of Jobs Report 2020 also indicates that the jobs created to work with these new technologies could reach 97 million by 2025. However, business leaders and the public sector must take action to promote equitable workforce development and prepare all workers for the jobs of the future.

While the bulk of the report takes a global perspective, the WEF also provides several country-specific profiles. The trends in the U.S. profile indicate that 57.6 percent of companies surveyed are accelerating the automation of tasks in response to the pandemic, and 91.5 percent are accelerating the digitization of work processes, while only 44.1 percent are implementing upskilling and reskilling programs. As companies increasingly rely on technology — and the use of technology — to complete essential business functions, displaced workers will face increasing demand for new, technology-based skills.

As Manufacturing Day continues to be recognized throughout the month of October, the Census Bureau issued a press release highlighting the key economic contributions of the manufacturing sector. The release highlighted the increases in the value of shipments and employment in the manufacturing sector from 2017 to 2018, as well as the sector’s nearly 60 percent share of U.S. exports. But a recent report from Policy Matters Ohio and The Century Foundation set a more cautionary note. Analyzing data over a much longer period and focused on four states in the Great Lakes region, the report finds that manufacturing jobs had not yet recovered to pre-Great Recession levels even before the COVID-19 pandemic began, and that the wage advantage of manufacturing has continued to erode compared to other sectors in the region.