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Employment Projections through the Lens of Education and Training

Students and career changers want to know what preparation is needed for entry into various careers or, alternatively, what types of career opportunities may be available for a given level of preparation. The counselors, teachers, parents, and others who assist the students also need this information. To better meet this need, the Bureau of Labor Statistics (BLS) has introduced a new set of education and training categories to depict the preparation that individuals need to enter and to become competent in specific occupations.

While these categories were developed specifically for users interested in career exploration and guidance, other data users are interested in this information as well. To help them make decisions on investments and human resource planning, policy makers, businesses, and others want to know what the expected demand may be for workers with various levels of education attainment and other preparation. While not directly depicting demand by education attainment, the BLS education and training categories provide insight into the expected demand.

This article examines the 2010 - 2020 employment projections through the lens of the new education and training categories. The results indicate, for example, that the fastest projected employment growth, 21.7 percent over the decade, is among occupations with a master's degree as the typical entry-level education needed, while the largest number of projected new jobs, 7.6 million, is among occupations with a high school or equivalent as the typical entry level needed.

Some occupations have several paths by which a prospective worker can enter, while others have a single distinct path. An important part of the path is the education that one needs to enter the occupation. For some occupations, a certain level of education is universally required, while for others, it is not as clear-cut. Consider two legal occupations: lawyers and paralegals. Prospective lawyers need to graduate from law school after completing a bachelor's degree. Paralegals, however, can enter the occupation with one of three formal education levels - a postsecondary non-degree award, an associate's degree, or a bachelor's degree.

Another part of the path is whether prior work experience is needed for entry. Such work experience is related to the current occupation a worker is entering, rather than general work experience through which the individual may develop more general skills or work habits. Many of the occupations with a work experience requirement are first-line supervisors or managers who need to have experience in the field that they are supervising or managing. Entrants to some non-managerial occupations may also need related work experience.

For some occupations, education can be substituted for work experience and vice versa. An example is the occupation chefs and head cooks. A prospective chef or head cook could enter the occupation with a degree from a culinary school and no prior work experience, or in lieu of formal education, he or she could enter with years of work experience as a lower-level cook.

On the job training, OJT, is an important part of the path. Such training is needed in many occupations for a person to become competent at performing the occupation. To be "competent" means that someone is qualified to perform the occupation independently. OJT is normally attained after one is employed in an occupation. It can be an apprenticeship, which is a formal relationship between a worker and a sponsor. Apprenticeships are most common in construction occupations, such as electricians, stonemasons, or carpenters. In other occupations, entrants need to complete an internship or residency. Each is found mainly in teaching and medical occupations and may be required for state licensure or certification. In addition, in some occupations, workers need less formal types of OJT to become competent.

BLS sought the best way to depict these requirements and devised the new education and training categories that are being used for the first time with the projections of employment from 2010 to 2020. The new categories include assignments in three different dimensions that make up a path:

  • typical education needed for entry
  • work experience in a related occupation
  • typical OJT needed to attain competency

The BLS data show the projected demand for occupations, and the categories indicate the education and training characteristics for occupations in the base year of 2010. The data presented in this article summarize the projected employment trends from the 2010 - 2020 National Employment Matrix by category and by path. Thus, the data represent the trend for occupations assigned to each category or path. The data do not specifically indicate the demand for workers by education attainment, such as demand for college graduates, nor do they indicate or project the educational attainment of the workforce.

In their analysis of the 2010 - 2020 occupational projections, Bureau economists C. Brett Lockard and Michael Wolf presented summary data for each of the three dimensions of education, training, and related work experience. These data are totals for all occupations assigned to each category. For example, employment in 2010 for the bachelor's degree education category was 22.2 million and is projected to grow by 16.5 percent to 25.8 million by 2020. These numbers represent the sum of employment in all 154 occupations assigned bachelor's degree as the typical entry-level education. (Note that these data do not represent the number of workers with bachelor's degrees in 2010 or projected to have such degrees in 2020.)

The fastest projected growth is among occupations with master's degree and doctoral or professional degree as the typically entry-level education needed, while the slowest growth is among occupations with high school diploma or equivalent.

Given the complexity of entry paths in certain occupations, some employers may require or prefer different education entry levels than the "typical" levels identified by BLS, and employers may adjust entry requirements in times of high or low unemployment. Also, within an education attainment level, demand may vary by the field of study related to the occupation. Indeed, the BLS projections indicate, for example, that bachelor's degree occupations in the computer and mathematical occupations group are projected to grow by 22.9 percent between 2010 and 2020, much faster than the 13.7 percent growth projected for bachelor's degree occupations in the education, training, and library group.

For the OJT dimension, Lockard and Wolf show that the fastest growth is projected for occupations assigned to the apprenticeship category, at 22.5 percent compared with 14.3 percent for all occupations. This category includes mainly construction occupations, which are projected to grow at above average rates but are not expected to regain all the jobs lost during the 2007 - 2009 recession. For the work experience in a related-occupation dimension, the fastest projected growth is among occupations in which no such experience is typically required. Among occupations with a work experience assignment other than "none," the most rapid projected growth is a below average 13.0 percent change over the decade for the less than 1-year group.

Across the education categories, the wage patterns approximate what would be expected from other information: wages are generally higher as the typical entry-level education rises. The results differ somewhat from this expectation, however, because other characteristics affect wages, including related work experience, OJT, and the field of study related to the occupation.

The highest median annual wages, at $87,500, are for occupations in the doctoral or professional degree category - more than twice the $33,840 median for all occupations. Median annual wages are similar for the three next highest education categories: master's degree at $60,240, bachelor's degree at $63,430, and associate's degree at $61,590. The somewhat lower median wage for master's degree occupations compared with bachelor's and associate's degree occupations conflicts with the expectation that investment in additional education generally results in a return of higher wages. Wages are affected by factors besides the level of degree, however, including the field of study relevant to the occupation. Returns are generally higher in some types of occupations - notably those in management and in technical fields - than others with the same or higher education requirements, such as counseling or social work.

These studies rely on employment demand by occupation as the source of demand for workers with various educational qualifications. The studies differ in their consideration of the nature of mismatches between the education that workers have and the education and training that occupations require.

The new BLS education and training categories and the 2010 - 2020 employment projections provide a data set for future research on this topic.

Source: Monthly Labor Review, Dixie Sommers and Teresa L. Morisi, 4/2012