The shock of Covid-19 sparked “the big quit,” with large numbers of American workers voluntarily leaving their jobs.
This exodus led The Economist to proclaim 2022 “the year of the worker.”
Truth be told, this reappraisal of what individuals want from work is wrenching in many ways—for workers, employers, and the public.
But this disruption has an upside.
It’s forcing America’s outdated education and training regime—from K–12 to postsecondary and including corporate approaches—to reconsider how to prepare individuals for jobs and careers or reconnect those who have been displaced, so that all can be on a pathway to opportunity and human flourishing.
Economists tell us that this regime reassessment must include an examination of lessons learned from what’s come to be called the “economics of skill development.” This field studies the relationship between our cognitive and noncognitive domains—often referred to as “hard skills” and “soft skills”—especially how they affect wages and labor-market success, with the results advancing or hindering an individual’s pursuit of opportunity.
Understanding this relationship can help to guide the development of a renewed education and training regime, an opportunity framework that underscores the relational aspects of success rather than focusing on its technical or material dimensions.
Skill Development and Labor Market Success
Harvard economist David Deming, a premier analyst in this field, has shown in an analysis of the National Longitudinal Survey of Youth that, since 2000, the significance of cognitive skills has declined as a predictor of labor-market wage success. Conversely, the economic importance of noncognitive skills, especially social skills, increased after 1997. He concludes, “Social skills are a significantly more important predictor of full-time employment and wages for youth in the 2004 to 2012 period, compared to the late 1980s and 1990s.”
These skills are characterized by high levels of nonroutine, interpersonal exchanges with others. They manifest themselves in capabilities like communication, cooperation, collaboration, social intelligence, and conflict resolution.
His analysis further reveals that, between 2000 and 2012, science, technology, engineering, and math (STEM) jobs decreased as a share of U.S. employment, while the share of non-STEM professional jobs in management, nursing, and business support grew at a faster rate than it had in the prior decade. Overall, between 1980 and 2012, the share of social skill jobs grew nearly 12 percentage points as a share of all jobs, with wages for these jobs growing more rapidly than those for other occupations. These non-STEM jobs rely extensively on analytical skills and interpersonal interaction.
Moreover, individuals with social skills are team players with a sense of mutual obligation that has benefits and burdens. Deming and his Harvard colleague Ben Weidmann find “suggestive evidence” that these team players advance group performance by inspiring the efforts of teammates, leading Deming to define teamwork as “workers trading tasks…and reducing the worker-specific cost of coordination…with others.”
A 2021 analysis by Deming shows that, after age 35, life-cycle wage growth is substantially greater in occupations that rely on nonroutine, high variance jobs that are decision intensive and require worker adaptation. In other words, having social skills produces a wage premium. And since these people-intensive skills are learned and developed through practice and feedback over extended periods of time, peak earning years have progressed up the age spectrum to the 50s from the 30s.
He summarizes this perspective by saying, “Strong cognitive skills are increasingly a necessary—but not a sufficient—condition for obtaining a good, high paying job. You also need to have social skills.”
In a paper that examined the economic return of hard and soft skills, economist Laura Chioda and colleagues looked at the medium-term impacts of a three-week, residential mini-MBA program. They examined two separate programs using a sample that included 4,400 high school students in Uganda. One program featured a mix of approximately 75 percent hard skills and 25 percent soft skills, while the other reversed this mix. The program training did improve both hard and soft skills, though “only soft skills were directly linked to improvement in self-efficacy, persuasion, and negotiation.” Additionally, the skill upgrade produced “substantially higher earnings.”
An Opportunity Framework
What I call an “opportunity framework” can reorient the current education and training regime across the age continuum to develop both cognitive and noncognitive capabilities, especially social skills, so individuals can pursue opportunity and flourish as adults.
The essential elements of an opportunity framework are what individuals know and who they know—knowledge and networks (or relationships). Cultivating habits of mind and association—cognitive and noncognitive capabilities—are the building blocks of individual opportunity. They are habits because pursuing knowledge and developing networks require behaviors learned and internalized through practice. These habits are also moral strengths that can produce prosocial behavior. A combination of habits of mind and association enables the pursuit of opportunity and human flourishing.
In short, an opportunity equation emerges: Knowledge + Networks = Opportunity.
Habits of mind encompass the hard skills needed for any occupation—that is to say, subject or domain knowledge, including technical knowledge. They involve three modes of thinking: goals thinking, or defining and setting achievable learning goals and outcomes; pathways thinking, or creating a route to those outcomes; and agency thinking, or the mental energy and self-reliance needed to pursue one’s goals along defined pathways. Pathways and agency thinking work together to foster the pursuit of goals and outcomes.
Habits of association include social skills. They lead to personal and professional networks that involve two complementary kinds of relational or social capital: bonding and bridging. Bonding social capital occurs within a group, reflecting the need to be with others for emotional support and companionship. Bridging social capital occurs between social groups, reflecting the need to connect with individuals different than ourselves, expanding our social circles across demographics and interests. As social scientist Xavier de Souza Briggs says, binding social capital is for “getting by,” and bridging social capital is for “getting ahead.”
Social capital includes relationships with individuals, midlevel groups or firms, and large local and national institutions that order society—the legal and judicial institutions where social capital becomes civic capital. Social psychologists Jonathan Haidt and Selin Kesebir describe how these elements intermingle as “the puzzle of cooperation,” beginning with those “who share the same gene because of descent from a recent common ancestor [expanding to] non-kin cooperation in large groups,” echoing Deming’s notion of social skills and teamwork.
Jobs, a Career, and Opportunity Pluralism
Understanding opportunity as a combination of knowledge and networks produces a framework for creating an education and training regime that community organizations like K–12 schools, workforce organizations, and other education and training enterprises can develop to advance opportunity. It aims to build the capacity of our present and future workforce in both the cognitive and noncognitive domains, better connecting current demand and supply.
The relationship between knowledge and networks is summarized by American Enterprise Institute Senor Fellow Brett Orrell: ”A technical skill can help you get a job, but noncognitive skills are necessary to building and sustaining a career.” Knowledge and networks are individual and social resources that lead to the development and accumulation of human capital and opportunity networks.
This notion of an opportunity equation is complemented by University of Texas law professor Joseph Fishkin’s ideas on how opportunities are structured and accessed by individuals, including how credentialing processes for work and career contain bottlenecks that deter opportunity. His argues for opportunity pluralism, an approach that offers individuals multiple credentialing pathways to work and career. This makes the nation’s opportunity infrastructure more pluralistic so individuals can pursue opportunity through many avenues linked to labor-market demands. These include paths like apprenticeships and internships; career and technical education; dual enrollment in high school and postsecondary and other training institutions; job placement for on-the-job training; career academies; boot camps for acquiring discrete knowledge and skills; and staffing and placement services. In short, opportunity pluralism aims to ensure that every American—regardless of background or current condition—has multiple pathways to acquiring the knowledge and networks needed for jobs, careers, and human flourishing.
The benefits of such an opportunity program would reach far beyond economic preparedness. They would include the importance of the relational aspects of success in addition to the technical or material dimensions—in short, the fact that relationships matter for individual and societal wellbeing.
This program also would also help individuals develop an occupational identity and vocational self. Choosing an occupation and developing a broader vocational sense of one’s values, abilities, and personality is important for adult success.
Further, the program would foster local civic engagement from employers and other community partners. And it has the potential to provide faster and cheaper pathways to jobs and careers.
This regime disruption and reassessment is a form of creative destruction, or the process through which new approaches replace the existing ones that were made obsolete over time. What emerges from this is a development narrative, or an account that chronicles individual agency, with individuals acquiring and extending knowledge and networks to help them succeed and flourish. Finally, this opportunity program will better place individuals on a trajectory to economic and social wellbeing, informed citizenship, and civic responsibility, laying a foundation for adult success, a lifetime of opportunity, and human flourishing.
Bruno V. Manno is Senior Advisor for the Walton Family Foundation’s education program. A version of this article also appeared at RealClearEducation.