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The Nation

That Good Education Might Not Be Enough

American workers at all levels are vulnerable to outsourcing, experts say, posing a challenge to the assumption that more schooling is the answer.

March 06, 2006|Peter G. Gosselin | Times Staff Writer

Bush's latest plug for the economic importance of education, especially college and graduate education, may contain the seeds for another controversy. Although the president has endorsed education rhetorically, many analysts say that he has not put federal money where his mouth is.

"The president's record for supporting college and post-secondary jobs training is anemic," Carnevale said.

Total spending on Pell grants, Washington's chief means of providing financial aid to poor college-bound students, rose from $10 billion in the 2001-2002 school year to $13.1 billion last year, but that was almost entirely because more students qualified. The average amount of aid per student barely budged in after-inflation terms.

The maximum school loan under Pell grants has steadily declined since 2002. At $4,050 per year, it covers about one-third of tuition, room and board at a public four-year college, down from 42% when the president took office, according to the College Board, the nonpartisan assessment organization.

The president's 2007 budget plan calls for cutting Education Department spending by, among other things, eliminating a major loan program to help needy students attend community college. Last week, Sen. Arlen Specter (R-Pa.), chairman of the Senate Appropriations subcommittee that oversees education, labeled the proposal "scandalous" and "insufficient."

But Bush may face a bigger challenge than defending the dollar amounts his administration directs to higher education. He could soon find himself having to defend what until recently has been almost universally accepted as fact -- that going to college or graduate school is a nearly certain route to higher pay, and a sure protection against the dislocation spawned by global competition.

What's undermining these comfortable assumptions, some analysts say, is a basic change in the kinds of jobs that are vulnerable to offshoring. Declines in transportation costs and improvements in communications technology -- including computers and the Internet -- are vastly expanding the range of things that can be bought and sold across international borders, and also the range of American workers who are exposed to international competition.

Until the last decade or so, most of what could be traded were manufactured goods that could be boxed up and sent abroad or bought overseas. Therefore, it was mostly American manufacturing workers who faced the brunt of competition. Services workers appeared immune and that seemed especially true of highly educated doctors, lawyers, computer programmers and financial experts.

But with the growth of the Internet, analysts say, many -- although not all -- sorts of service work can be performed almost anywhere in the world. Now many kinds of service workers are finding themselves exposed to the same global competition as their manufacturing counterparts.

"Many people blithely assume that the critical labor-market distinction is, and will remain, between highly educated (or highly-skilled) people and less-educated (or less-skilled) people, doctors versus call-center operators, for example," Blinder wrote in a recent article in the magazine Foreign Affairs.

The assumption is that those with higher education are either better shielded from global competition or better able to adapt to it, he said. And this leads many policymakers to call for "more education and a general 'upskilling' of the workforce."

But, Blinder wrote, the crucial distinction in the future may not be between the more-educated and less-educated, but between "those types of work that are easily deliverable through a wire ... and those that are not."

Some education-heavy jobs such as computer programming are proving easily deliverable by wire and many programming jobs have been shifted overseas, an irony in an era when many had thought that tech-savvy workers would be among the economy's big winners.

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