Education Benefits for Workers

SkillsWave joins the evolving market for education-benefit management. Also, new research on the yawning gap between jobs and middle-skills credentials in metro areas, and kicking the tires on a new AI tool that seeks to make career information more accessible.

Upskilling Amid Disruption

The corporate education-benefit business in the U.S. has a new entrant. 

SkillsWave became a stand-alone company in April, after being spun out by D2L, a Canada-based online-learning company that has a large footprint in this country. The company’s leaders hope its roots and continued ties to D2L will give it a leg up.

“We focus on the business results of upskilling,” says Sasha Thackaberry Voinovich, president of SkillsWave. “It has to be a win-win-win for the employee, the employer, and the education partner.”

In addition to traditional education-benefit management, the company offers learning paths to help employees move up in their careers, as well as reskilling and skills mapping. SkillsWave had success with large employers in Canada before turning south. Its network of education providers includes continuing education divisions of universities on both sides of the border, as well as National University. Purdue University signed on this week.

The company is working with education partners its corporate learners can trust, says Charlotte Bencaz, vice president of education partnerships for SkillsWave: “That includes higher education institutions, community colleges, and nontraditional education partners known for quality in their industry and that have expertise supporting adult learners at scale.”

Evolving Business Models: SkillsWave joins several well-established companies, including Guild, InStride, EdAssist, and Workforce Edge. 

Education benefits have become table stakes across many industries. And while relatively few workers use them—with uptake rates historically hovering between 2% and 5%—observers cite unnamed examples where 15% of a corporate workforce taps their education benefits. Frontline workers also have become more of a priority, including for Target, according to a recent brief from Haley Glover, who leads the Aspen Institute’s Upskill America.

Other education benefit companies have been expanding their offerings, with more of an emphasis on upskilling and career pathways. And competition could be stiff—Guild recently had two rounds of layoffs.

While Voinovich acknowledges that SkillsWave are the new kids on the block, she says the company focuses on areas where it can make the biggest impact. That won’t include healthcare, a crowded, complex industry SkillsWave is avoiding. The company points to a strong need for upskilling in energy, engineering, construction, retail and professional services, and manufacturing, particularly the semiconductor space.

“It could not be a more important time to upskill employees with the technology disruption that is transforming the way that companies do business,” Voinovich says. “Removing the friction from access to high-quality education is what we do.”

The programs SkillsWave offers to learners include short-term, stackable options—with the credential-as-you-go approach. The company also studies the ROI for both learners and employers. And while SkillsWave will be selective with its education partners, it features customizable learning options for businesses.

The new company’s competitors have had a big impact on corporate education, says Voinovich, even if the business model is evolving.

The Kicker: “There’s so much need in this area,” she says. “I have no doubt many companies in the education benefit space can succeed.”

High Pay, Low Uptake

Blue-collar worker shortages are much talked about these days, including by publications like The New Yorker, which isn’t exactly known for covering the workforce. The shortages threaten the success of federal investments like the CHIPS and Science Act and the infrastructure law.

Even so, researchers at Georgetown University were surprised to find just how extreme the situation is in America’s cities. In an analysis released today, they looked at how many graduates colleges and other education providers were producing with middle-skill credentials—certificates and associate degrees—that are aligned with high-paying jobs in 55 metro areas with at least 1M residents.

• In 52 of the 55 metro areas, the production of credentials for high-paying blue-collar jobs is falling short—often far short—of what is needed to keep up with local demand.

• The current supply would only meet 13% of the projected demand through 2032, for a shortfall of almost 360K credentials.

These are jobs like first-line supervisors in production and operations, industrial machinery mechanics, and construction equipment operators. And cities like Washington, Dallas, and Boston face the most severe shortfalls relative to demand.

“We hear a lot about blue-collar worker shortages, but the size of the anticipated shortage in high-paying middle-skills blue-collar occupations is startling,” says Zack Mabel, lead author of the study and director of research at Georgetown’s Center on Education and the Workforce (CEW).

Beyond Blue-Collar Jobs

The new report is part of a larger body of work at CEW looking at the mismatch between jobs and middle-skill credentials across the country. A previous study found that at least 50% of certificates and associate degrees produced today would need to be in different fields to align supply with available jobs.

The Details: The new study zeroes in on high-paying jobs in large metros. Mabel and his co-authors define high-paying middle-skills occupations as those in which more than half of early-career (ages 18 to 35) workers have a job with annual earnings of more than $53K. 

• Early on, these jobs typically pay more than young workers with a bachelor’s make—and people in these middle-skills jobs also tend to see significant earnings growth over their career.

• By midcareer, median annual pay hits $80K.

Just over 100 jobs met that definition, and they fell into five occupational groups: blue collar; healthcare; management; protective services; and science, technology, engineering, and mathematics (STEM).

Shortfalls: Middle-skill shortfalls are less extreme beyond blue-collar roles, but still pronounced.

• More than two-thirds of the metro areas studied will experience shortfalls in middle-skill credentials aligned with high-paying jobs in management occupations (sales managers, project management specialists) and protective services (police officers, firefighters).

• STEM credentials, however, are relatively well aligned, and middle-skill healthcare credentials are actually oversupplied in many metros as hospital systems and other providers increasingly prefer nurses with bachelor’s degrees.

Why the Gap?

More students at community colleges and other middle-skill credential providers need to be directed to programs that align with high-paying jobs, Mabel says. But even so, there just are not enough students entering certificate and associate degree programs that put them on a path to middle-skill jobs.

Stigma, especially around the trades, plays a role, he says. And many community colleges also have limited capacity in STEM and trades programs aligned with high-paying jobs, as they struggle with the costs of building labs, buying and maintaining state-of-the-art equipment, and competing with industry for qualified instructors.

A Herculean Task: The supply-demand gap is so large in many metros, Mabel says, that existing institutions likely can’t fill the gap.

• In places with credential shortfalls around high-paying blue-collar, management, and protective services jobs, more than half of the existing providers would need to double their production in order to meet local demand.

They likely can’t do that, Mabel says, so new players will need to pick up the slack. 

“More providers—new institutions and existing four-year institutions—likely need to enter the market to eliminate credential shortages in programs aligned with high-paying occupations in many of the largest U.S. metro areas.”—By Elyse Ashburn

Open Tabs

Funding Apprenticeship
The U.S. should strive to create 3M apprenticeships each year—a realistic goal that would be the equivalent of apprenticeship’s roughly 2% share of the workforce in Britain and France, writes Heather Long, a columnist for The Washington Post. With 643K registered apprentices, the current U.S. workforce share is 0.4%. A modest federal investment could bring massive change, writes Long, who also calls for a nationwide credentialing system.

AI in the Philippines
Call centers in the Philippines are rushing to roll out AI tools, potentially leading to 300K lost jobs in the nation’s $38B business process outsourcing industry over the next few years, according to an estimate cited by Bloomberg’s Saritha Rai. The technology also could create up to 100K jobs in new roles. But the possible net loss of jobs in the Philippines is leading to calls for upskilling and updates to social security and tax systems.

Energy Roles
Clean energy jobs grew at double the rate (4.2%) of job growth across the economy (2%) last year, adding 142K jobs, according to the U.S. Department of Energy. Clean energy jobs increased in every U.S. state, and across energy technology categories tracked by the agency, including electric power generation; energy efficiency; fuels; motor vehicles; and transmission, distribution, and storage. Construction employment in energy grew 4.5%.

Occupational Segregation
Black workers hold roughly 20% of the 1.6M jobs in transportation and material moving that the U.S. economy added since 2019, JFF’s Michael Collins writes in Forbes. Those jobs pay well without requiring education past high school. But they often provide insufficient protection from unsafe conditions or disruption because of AI or automation, writes Collins, who says disrupting occupational segregation is key to boosting economic mobility.

Chips and Community Colleges
New America is creating an accelerator for community colleges in the innovation economy. With $3M from Ascendium Education Group, the project seeks to serve as a force multiplier for 22-plus community colleges that are receiving federal money through the CHIPS Act–initiated regional innovation program from the National Science Foundation. New America will provide technical assistance, funding, research support, and a community of practice.

Is columnist Heather Long right to argue that the U.S. could realistically hit a goal of apprentices comprising 2% of the workforce? And to do it with a relatively modest government investment? Let me know what you think.—PF