LinkedIn CEO Jeff Weiner argues that unemployment is worse than the numbers would lead you to believe -- and makes bold proposals on how to resolve the crisis.
By Jeff Weiner, CEO, LinkedIn
Tonight, President Obama is scheduled to unveil the government’s latest plan to address the country’s labor crisis. Unemployment is at 9.1%. However, that number only scratches the surface of the magnitude of the problem. There are over 25 million Americans unemployed, underemployed or only marginally attached to the workforce. Factor in the average size of a U.S. household and that’s as many as 20% of Americans whose lives are being dramatically impacted by this stagnation.
Yet there’s another massive labor imbalance in the country that rarely gets attention. According to the most recent report from the Bureau of Labor Statistics, there are over three million job opportunities going unfilled in the U.S. right now, the highest level in three years.
How is that possible? Simply put, companies can find workers; they just can’t find the right workers. The CEO of Siemens’ SI U.S. subsidiary says that his company has at least 3,200 open jobs it’s trying to staff. Everyone from industry giants like Microsoft SI to small- and medium-sized businesses like Begal Enterprises, a disaster-cleanup company in Maryland, are struggling to find qualified employees for their open jobs.
Fixing this imbalance and matching job openings with willing talent will go a long way toward restarting a virtuous economic cycle: when companies expand, they pay more taxes, consume more services (enabling other companies to expand) and open up opportunities for others to be promoted or hired. So how do we do it? Here are three proposed solutions:
• Embrace the economic graph. The technology revolution has upended industries and career paths at an unprecedented pace. Economic transitions that once took centuries (think agrarian to industrial) or decades (think industrial to information), are now taking place over only a handful of years. Classic economic theory would suggest that when Amazon AMZN overturns Borders or Netflix NFLX sinks Blockbuster, productivity gains manifested by these next generation companies should enable the displaced employees to find work elsewhere and add incremental economic value to the system. That’s clearly not happening.
We need to make the pace of technological change work to fix the same problem that it helped create. This will come through the development of an economic graph.
Most of us are by now familiar with the value generated by the social graph concept popularized by Facebook, the professional graph developed by LinkedIn LNKD , and the interest graph implicitly manifested by Twitter. What if we were able to extend that thinking to the economy itself and developed an economic graph?
Imagine a world in which every job opportunity, full-time and temporary, was digitally searchable and linked to the appropriate company and skills required to obtain the position. Now imagine if the 153 million people in the U.S. workforce — or 3.3 billion people in the global workforce — had a digital profile, highlighting their experiences, skills and, most importantly, their ambitions. Each of those individuals would be empowered to develop their professional identities, networks and knowledge and subsequently not just find jobs, but also map and fulfill their ideal career paths. Qualified candidates could easily ask their connections about existing opportunities, apply for those jobs at the click of a button, and request introductions so they’d never go into a potential employer cold.
Graduating students could instantly find appropriate mentors. Employers could fill critical open jobs by searching across a rich set of highly relevant facets in order to find the ideal candidates. Economists could generate insights leading to improved predictive analysis of where future jobs will be, and in turn, today’s educators could leverage that information to prevent the creation of future skills imbalances.
• Free the H1-B. There are highly skilled individuals working outside the U.S. who are capable of filling today’s vacant, yet critical jobs — jobs that may be at risk of being shipped overseas. Yet these people can’t work in the U.S. because of limitations on the number of available H1-B visas.
Opening the doors to such professionals would not only increase the productivity of their new employers, but fuel job creation domestically as these same individuals earn wages that will be spent in the U.S. economy. Additionally, these talented engineers, scientists and other highly skilled workers are the same people capable of starting companies that generate exponentially more economic opportunities for others.
• Link education to opportunity. Today, we train students for the jobs of yesterday, not the jobs of today or, more importantly, the jobs of tomorrow. We need to harness the data available through digital platforms to create just-in-time professional training programs based on current and future job availabilities.
In addition to traditional vocational classrooms, that training can take place at universities, community colleges or within companies themselves. One powerful and often overlooked tool is the internship. At LinkedIn, we’ve established a partnership with Year Up, which seeks to close the opportunity divide by providing internships to young adults in low-income communities. We’ve also built a successful paid summer internship program for students, providing them with hands-on experience in key positions for the company. However, for smaller businesses that can’t afford to train uninitiated talent and pay them at the same time, these potential learning opportunities are squandered. We need to provide these companies the right incentives to create more flexible programs along these lines.
Investing in these initiatives will help fill the millions of open jobs in this country. It will also foster new growth and create new opportunities, helping to solve our broader unemployment crisis. But more is needed to make sure the skills gap doesn’t widen again.
Most importantly, we must completely overhaul our educational system. We can start by transforming our schools from places where antiquated rote learning techniques are taught into one where the building blocks for real-world job skills are prized. That means fostering capabilities such as critical reasoning, collaboration and creative problem solving.
To build this new system, we need to recruit and develop teachers — and we need to do that at massive scale. The California Department of Education, for one, estimates that 97,000 teachers — 32% of its teaching ranks — will retire over the next 10 years. Similar teacher shortages exist elsewhere. Building the next generation of educators starts now. Finally, we can speed the build-out of a cutting-edge, national mobile and broadband infrastructure, ensuring that every American has access to the right information and knowledge, and can ultimately pursue their ideal career path.
We have everything we need to bridge the gap between talent and opportunity. The solutions are within our grasp, but there is much work to be done. Our outdated analog approaches to preparing the workforce for the jobs of the 21st century led us into this crisis. New digital technology and creative approaches will lead us out of it. Now is the time.