Local Workforce Skills and Economic Growth

A balanced approach to economic growth includes creating low-skilled jobs.

In researching the economic and fiscal impacts of the proposed Ohio casinos, the Economics Center examined the composition of the local workforce by education level.  This research revealed that almost 45 percent of the working-age population of the Greater Cincinnati Metropolitan Area has a high school diploma or less.   Economic development discussions often center on bringing high earning jobs to the area to spur growth, but nearly half of the existing population segment would likely lack the necessary skills to take advantage of these jobs.

In addition to being a significant proportion of the population, analysis of the data also revealed that this population has substantially lower rates of labor force participation. They are about 40 percent more likely than their more educated counterparts to be out of the labor force.  Thus, among this segment of the local population, a smaller proportion of people are working or actively seeking work.

Those individuals with no more than a high school diploma generally have less success finding jobs and are more than 40 percent more likely to be unemployed than those with at least some college. Some people argue that because of the difficulties this group has finding work, they often give up the search and they are no long counted in the unemployment rate. Thus the unemployment rate may underestimate the number in this group who do not have jobs. Because these individuals are about twice as likely to be out of work, they probably will be net users of public assistance programs funded by local taxes.

While attracting high skill, high value positions to the region is a strategy for fueling economic growth and increasing the tax base, it may not address the lack of employment among those with less education. Thus, a balanced approach that seeks positions appropriate for lower skilled workers may have several benefits. These positions provide viable opportunities for individuals who have less education and they may be a means to self sufficiency, reducing dependence on public assistance programs and potentially transforming these individuals into net contributors to the local tax base. Additionally, these lower skilled jobs can often be transitional, offering job training and experience that can help individuals advance along the workforce ladder. Leveraging the workforce that already exists in the region will help reduce area unemployment, dependence on public subsidies and programs, and strengthen the local tax base.

As workforce development issues are gaining visibility locally, the Economics Center has provided organizations workforce analysis. Recently, the Economics Center provided industry intelligence to Cincinnati Works, a local organization that connects lower skilled workers with local businesses, to facilitate building their network of area employers. Additionally the Center assisted Clermont County by identifying workforce needs of Cincinnati target industries and by communicating the need to integrate training and educational programs for moderate skilled employees into its broader economic development efforts.