Workers filling less-skilled jobs have always been a crucial part of our economy - taking on roles powering our factories, serving up food in restaurants, and tilling our farms. Although our need for these less-skilled workers has remained strong over the last several decades, dramatic changes in the composition of the American population have left a large and growing shortage of U.S.-born individuals willing and able to fill certain critical less-skilled positions. This report aims to quantify the decline in the number of less-skilled, U.S.-born Americans in the U.S. working-age population and provide policymakers with insight into the large workforce gap that is looming in the future.

Much has been written about the increasing need for a college education in today’s economy. Less attention, however, is paid to the fact that our need for less skilled workers - which this report defines as those with a high school diploma or below - remains strong. In 1990, 45.7 million less-skilled individuals had jobs in the U.S. economy. By 2010, that number was virtually unchanged - despite the fact the Great Recession had had a negative impact on U.S. employment overall. And the Bureau of Labor Statistics has reported that although the number of jobs requiring a bachelor’s degree or above will grow at a faster rate than lower-skilled employment in the coming years, less-skilled employment will still account for the majority of U.S. job growth. Between 2010 and 2020, BLS projects that 63 percent of new America jobs will require a high school education or below - far more than any other category.

Demographic shifts in the U.S. population over the last two decades, however, have made it increasingly difficult for the U.S. workforce to fill many of these jobs. Aging baby boomers and declining fertility rates have driven up the average age of American workers, decreasing the pool of Americans interested in less-skilled - and potentially labor-intensive - jobs. During the same period, vastly more U.S.-born residents have pursued a higher education, a development that’s allowed more Americans to do work requiring specialized training. In this report, we use data from the U.S. Census and American Community Survey to show that these trends have led to a dramatic decrease in the number of less-skilled, U.S.-born potential workers employers have to draw from - a gap that could have been even greater if not for the contributions already being made by immigrants and their children, and one that could be filled by U.S. immigration policy that better meets the demands of the U.S. labor market.

KEY FINDINGS:
America has a declining number of young workers willing and able to work less-skilled jobs. Between 1990 and 2010, the number of less-skilled, young U.S.-born Americans (aged 25-44) declined by almost 12.3 million. This was caused by both increased education –the percentage of working-age adults with more than a high school education jumped from less than 47 percent to more than 56 percent during this period – and by decreasing fertility rates. By the mid-1970s, fertility rates were roughly half of what they were during the post WWII Baby Boom.

The decline in the less-skilled, young population has been particularly pronounced among women. Almost two thirds of the decline in the number of young, less-skilled, U.S.-born individuals can be explained by a decrease in the number of less-skilled women in America. Between 1990 and 2010, the number of women in that group fell by 8 million people. This was in large part because of dramatic gains in female educational attainment: While just 44.9 percent of US-born women of working age had at least some college education in 1990, by 2010 that figure had surged to 58.7 percent.

The demand for less-skilled workers is strong and growing. According to the U.S. Census, between 1990 and 2010, the number of jobs for less-skilled workers in the U.S. economy remained constant at 45.7 million. And in the coming years, less-skilled employment is expected to grow: The Bureau of Labor Statistics estimates that 63 percent of the new jobs created between 2008 and 2018 will require a high school degree or less.

Second generation immigrants have helped offset some of these labor gaps. Between 1995 and 2010, while the number of less-skilled, young, American-born individuals overall declined, the number of second-generation immigrants in that category grew by more than 680,000.

We do not admit a sufficient number of immigrants to offset the looming workforce deficit of less-skilled workers. Between 1990 and 2010, when the number of young, U.S.-born, less-skilled individuals declined by almost 12.3 million, only 3.9 million young immigrants arrived in the country to replace them.

This decline in the number of less-skilled workers represents a real and growing threat to U.S. economic growth. To some extent, the recent economic downturn has insulated employers from the full impact of these labor issues because it led some businesses to scale back their workforce and pushed some college-educated workers to seek employment in roles that would not typically require college degrees.

But even during the worst of the recession, employers in some industries and some parts of the country had trouble filling less-skilled positions. And as the economy continues to improve, the declining number of native-born, workers willing to fill less-skilled jobs could prove particularly problematic, hindering the ability of our economy to expand and add more jobs at all skill levels.

As Congress takes on the issue of immigration reform, these demographic changes should be top of mind. To help employers answer current - and especially future - workforce needs, it is imperative that the U.S. design a flexible immigration system that will allow businesses to hire needed less-skilled immigrant workers when no equivalent U.S.-born workers are available. Today’s broken immigration system makes that task very difficult.

As our findings make clear, however, solving that challenge is more important than ever.

Review the full report online.

Report authored by:
Frank D. Bean, University of California, Irvine
James D. Bachmeier, Temple University
Susan K. Brown, University of California, Irvine
In affiliation with the Center for Research on Immigration, Population and Public Policy at the University of California, Irvine.