The Unskilled Issue

I recently read an article that made a case for the next recession in the United States coming from the large drop in the wages of the lowest portion of the population.  According to the study when there is a negative real rate of growth of the lower income this normally results in the onset of a recession for the simple reason that the in the economy most of the population falls below the median income due to the skewness of the income curve.  Losing their spending power results in cutting back on goods and services and this leads to a recession as companies are unable to sell their wares into the market.

This article interested me as Africa is a continent with massive unskilled worker problems.  More than 40% of unskilled workers in South Africa are unemployed which is why crime levels are so high.  So if the United States is having a problem that may drag it into recession, what of Africa and how does one manage to get these masses employed and their real rates of income higher?

This is a global problem and one that is rapidly being exacerbated by the continued influence of technology on society.  More and more there is a requirement for the unskilled to become skilled and so access to training and education is the obvious solution.  Now while this may seem obvious the next issue facing the United States is one of massive student debt.  I believe that it is imperative that the government provide assistance to students, the problem is that there are plenty of schools that are not providing the level of education required to ensure gainful employment once they depart the school.  Furthermore while shortages are still prevalent in technology and other skilled sectors of all economies the problem is that the high school proficiency in science and mathematics are lacking so there is not a large enough pool of college entrants to fill these spots.

Taking this one step further spending money on higher education is wasted until you get your primary education house in order and in this respect the United States and South Africa are both lacking.  In comparison the eastern economies place high regard on academic studies at the high school level there is a total disdain for this in these two countries.  Now as always this is a very broad brush I am painting with as there are institutions in both countries that prize their level of education but overall the masses are pushed through the system with little regard for the follow on options required to stimulate the economies.

The obvious solution would be to target this as a place for large scale investment and new government policy to align the desired level of education with the expected challenges and opportunities of life beyond high school.  No child left behind was flawed in that the result was that schools were rewarded for making sure that the bottom tier passed forgoing the rest of the kids in the grade.  The thing to remember is that not everyone will be a science and mathematical whizz but with all the new technological developments being created unless this tertiary education can be improved these problems will remain.