Decent Wages Without A College Degree: How Does Your Job Market Stack Up?

Metropolitan job markets differ from one another in many important ways. Some economies revolve around information and professional services (think San Jose). Others depend on tourism and accommodations (think Las Vegas). Still others are built around “eds and meds” (think Ann Arbor).

Naturally, the livelihood of residents participating in a given job market is influenced by the types of jobs available in their region. Financial stability for any worker is predicated on access to jobs that pay adequate wages and on having the necessary skills and qualifications to become and remain gainfully employed. Thinking about the intersection of place, employment, and education, researchers at three Federal Reserve Banks investigated how local economic opportunity levels vary for workers without a college degree. In this post, I’ll summarize what we learned. But first, a little background.

In our research, we coined the term “opportunity occupation” to describe an occupation that generally does not require a four-year college degree and that pays at least the national annual median wage (around $35,000), adjusted for cost-of-living differences across metropolitan areas. The research examined the job markets of the 100 largest metropolitan economies in the U.S. in order to (a) identify the most prevalent opportunity occupations and (b) discern the share of employment meeting our opportunity occupation definition.

Opportunity Occupation infographicFinding #1: Top opportunity occupations include both white- and blue-collar work

A surprising number of the most prevalent opportunity occupations across the largest metropolitan areas are white-collar. Among the largest opportunity occupations identified in this research, employment is greatest for registered nurses, which is joined in the health-care field by licensed practical and licensed vocational nurses. Other white-collar professions at the top of the list include bookkeeping and accounting clerks, retail sales supervisors, and secretaries and administrative assistants. As we’ll see, however, some employers prefer college-educated candidates even for these jobs.

OO mapFinding #2: Some metropolitan areas are opportunity rich, while others are less so


Using a data set that reflects survey responses from current workers regarding the education needed to perform their job, we found that roughly 27 percent of all employment meets our definition of an opportunity occupation. The percentage varies dramatically across metropolitan areas, however. For example, it exceeds 36 percent in the Kansas City, Des Moines, and Cleveland metropolitan areas but fails to reach even 20 percent in Orlando, El Paso, and McAllen.

Finding #3: Employer preferences for a college degree can limit opportunities for less-educated workers

We also analyzed a database of tens of millions of online job advertisements posted between 2011 and 2014 and compiled byBurning Glass Technologies. We took this step because we wanted to learn more about the level of education preferred by employers trying to fill open positions that, according to other sources, don’t typically require a four-year college degree.

Unsurprisingly, our research shows that employers generally do not require a bachelor’s degree for the blue-collar opportunity occupations previously identified — maintenance and repair workers, electricians, and the like.

In some metropolitan areas, though, the majority of employers preferred a college-educated candidate to fill job openings in the white-collar opportunity occupations. For example, in Fayetteville, only 31 percent of job postings for retail sales supervisors did notrequest a bachelor’s degree or higher; at the other end of the spectrum was Little Rock, where this was true of 76 percent of online job ads.  In other words, just within the state of Arkansas, retail sales supervisors without a college degree encountered an abundance of opportunity in one metropolitan area and a scarcity of opportunity in another.

Going Forward

Future research will delve more deeply into why workers in the same profession are more likely to need a college degree to get hired in one metropolitan area than they are in another. Is it attributable to the types of industries concentrated in the region, the characteristics of the labor force — or something else entirely? This new research will inform a lively conversation with workforce development professionals at the Federal Reserve Bank of Philadelphia’s upcomingReinventing Our Communities conference.

Through additional research and engagement with both the workforce development and private sectors, we hope to develop a better understanding of this phenomenon — an understanding that could help expand decent-paying employment opportunities for the 70 percent of Americans 25 years and older without a four-year college degree.

Notes

This post summarizes research published in “Identifying Opportunity Occupations in the Nation’s Largest Metropolitan Economies,” written by Keith Wardrip, Kyle Fee, Lisa Nelson, and Stuart Andreason, and published by the Federal Reserve Banks of Philadelphia, Cleveland, and Atlanta, September 2015. The full report is available atwww.philadelphiafed.org/community-development/publications/special-reports.

The views expressed in this post are not necessarily the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.




The GradsofLifeVoice Forbes team provides thought leadership, research and expert commentary on innovative talent pipelines and related issues such as the skills gap, income inequality, workforce diversity, and the business case for employment pathways. We seek to change employers’ perceptions of young adults with atypical resumes from social liabilities to economic assets. This post was originally featured here.


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