CHERRY HILL, N.J. and PORTLAND, Maine, April 19, 2011 /PRNewswire/ -- The polarization of the labor market is dramatically reshaping current and future job growth in the U.S., to the point where for the first time in history, middle-skilled jobs do not reflect the majority of American workers. This is according to a new report released today by TD Economics (www.td.com/economics), an affiliate of TD Bank, America's Most Convenient Bank®.
"As more middle-skilled jobs are squeezed from the workplace, the dominant perception is that these positions are being replaced by a growing army of low-quality, and likewise, low-skilled positions," says TD Deputy Chief Economist Beata Caranci. "However, the data show otherwise. High-skilled positions have increased by four percentage points over the past decade, and demand for high-skilled workers intensified even during the Great Recession."
The TD Economists forecast that this polarization trend – where job growth is concentrated at the polar ends of the skills curve – will persist far into the future, placing states that do not move workers up the skills curve at greater risk of having economies snared by higher unemployment and lower incomes, and of being more vulnerable to the swings of future business cycles.
"A number of states in the Northeast have developed a competitive edge in attracting skilled, highly educated labor, but the changing reality of the labor market has left some states playing catch-up," Caranci says. The states that form the epicenter of the Appalachian manufacturing belt, particularly North and South Carolina, had long pursued policies that supported middle-skills payrolls through a growing manufacturing base. "These states have seen some success in implementing a come-from-behind strategy, but are a long way from closing the skills gap with their northern neighbors."
The key, the TD Economists say, is for lagging states to develop diverse industry clusters that will feed into economic growth. Over time, these will automatically become magnets for skilled labor.
TD Economics provides analysis of global economic performance and forecasting, and is an affiliate of TD Bank, America's Most Convenient Bank.
The complete findings of the TD Economics report are available online at http://www.td.com/economics/special/cj0411_polarization.pdf.
SOURCE TD Bank