A look at jobs and economic growth in the state of California
Note to readers: Each week through November 2019, a selection of our 101 California Influencers answers a question that is critical to California’s future. Topics include education, healthcare, environment, housing and economic growth.
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California Influencers this week answered the question: How do we create better (and better-paying) jobs for working Californians? Below are the Influencers’ answers in their entirety.
Lenny Mendonca - Chief Economic and Business Adviser to Gov. Gavin Newsom
California is the fifth-largest economy in the world. We are leaders in technology, sciences, services, arts, agriculture, shipping and logistics, and we are renowned for our diverse talent pool. But we face significant headwinds when it comes to economic mobility. These challenges will be exacerbated in the years to come as rapid advancements in technology change workforce demands at a dizzying rate – affecting us all. The McKinsey Global Institute and The Aspen Institute report that automation will touch nearly every occupation. Our workers can’t be expected to bear the burden of this transition alone, nor the associated costs. We will need a real plan and partnerships across employers, workers, higher education and government to ensure everyone has the skills and abilities that align with the new economy’s needs. All of us must embrace and develop life-long learning muscles, and we must make significant investments in education and agile skills training systems to develop the most skilled workforce on the planet. If we do this right (and at an unprecedented pace and scale) we will ensure the jobs of tomorrow are quality, better-paying jobs that support economic mobility in a California that works for all.
Donna Lucas - CEO and President of Lucas Public Affairs
In an increasingly tech-driven economy, the link between education and jobs is more important than ever. California needs a skilled workforce – not just to meet existing employers’ demands, but to attract new businesses and high-paying jobs to the state. Unfortunately, there is a growing gap between the skills employers need and the training graduates are receiving. We need to take a forward-thinking, demand-oriented approach – what are the industries and jobs that will drive the global economy over the next century? And what are the skills and training needed for those jobs? The private sector identifies years in advance what their workforce needs will be; they should work with institutions of higher learning – trade schools, colleges and universities – to develop that workforce. In fact, many businesses and schools already doing their part. Tech companies are investing in continuing education and re-training to upskill existing workforces. Community colleges are partnering with employers to develop curricula that specifically train employees with the skills they need. This is the kind of innovation and collaboration that we need to ensure that our workforce can meet the demands of the new economy, and that businesses keep looking to California when seeking the best and brightest talent.
John Chiang - former California State Treasurer
California businesses and the public sector need to invest in the lifelong education of workers to compete in a smarter (AI, machine learning), healthier (medical technology) and more connected world.
On Earth Day, I spoke at a grand opening of a new venture which ties LED to a solar based company involved with thermal detection, artificial intelligence and WiFi. Some of the equipment was used during the Napa wildfires. The owner of the solar company desperately tried to manufacture the equipment in California. Unfortunately, he was unable to find the skilled workforce he needed in Fresno so he is going to manufacture the product elsewhere.
Caitlin Vega - Legislative Director for the California Labor Federation
In this economy, jobs may be plentiful, but for many working families, it’s a daily struggle to make ends meet. Low wages, no security, no retirement, no set schedule-these are the jobs produced when workers have so little power and corporations have so much.
It doesn’t have to be this way. Less than a century ago, unions built the middle class. Working people stood together, on the strike line and at the negotiating table, and the Labor Movement set industry standards that raised wages for all workers.
As union density declined, wages steadily fell. Companies found new ways to increase profit, like calling workers “contractors” to avoid basic labor protections. Today we face unprecedented income inequality.
To rebuild our middle-class, we must focus on job quality, directing tax credits and public subsidies only to companies that offer fair wages, healthcare and retirement. Worker protection laws should be vigorously enforced, especially the Dynamex decision which raises wages, gives workers the right to organize, and levels the playing field for law-abiding businesses.
The Marriott hotel strikers said it best: “One job should be enough.” We can build that future of work with strong labor laws, strong job quality standards, and strong unions.
Jennifer Barrera - Executive Vice President of the California Chamber of Commerce
The best way to create high-quality, high-paying jobs in California is improve the quality of our education system and job training, so that workers are prepared and trained with the skills that fit the employers’ needs, and keep costs low, including taxes and litigation, so that employers have resources to invest in innovation and their employees, enabling the creation of higher wage jobs.
Catherine Lew - Co-Founder and Principal Consultant for The Lew Edwards Group
Let’s first focus on equity for good jobs we already have. Demand that women receive equal pay for equal work! California is the world’s 5th largest economy and currently leads the nation in nonfarm job growth— but has the country’s top wage gap between middle income and wealthy earners. It’s unacceptable residents are not sharing in our State’s prosperity! Better pay doesn’t help if teachers, nurses, and emergency responders can’t afford to live here. Housing and family-sustaining pay go hand in hand. Expand affordable workforce housing (built with union labor) and protect renters from rent spikes. Level the playing field for low-wage gig workers (ride share drivers, grocery deliverers) and fast food servers by demanding bargaining rights from corporate America that pay a living wage and require worker protections. Increase opportunities to earn college credits, training and apprenticeship certifications debt free as half the equation—the other is to create demand for skilled, sustaining jobs for a workforce trained to fill them. Creating innovation in regions such as the Central Valley growing twice the rate as the State as a whole—is critical if California is to maintain its economic position and stand behind its values for social equity.
Tom Campbell - Professor of Law and Economics at Chapman University
There is no substitute for the genius of free enterprise. Outside of production needed in the middle of a war, it’s almost always better to follow the flow of capital and labor to the industries determined by those who are willing to stake their careers and their investments. Otherwise, we end up with companies like Solyndra, which went bankrupt after the federal government guaranteed more than half a billion in loans. The government was SURE its solar energy business was a winner! But Solyndra couldn’t convince private investors, that’s why it needed the government-backed loan; and the skeptical potential private investors were proved right.
California should evaluate every regulatory scheme and tax, and every subsidy directed at favored projects, to minimize government’s heavy footprint. We’re the least favored place to start a new company, among all 50 states, and have been for each of the last 15 years, according to Chief Executive Magazine. The solution is not to have the same government that created obstacles to new companies decide which new industries should be favored. Bad judgment should be constrained, not rewarded.
Monique Limon - California State Assemblywoman (D-Goleta)
Californians need well-paid jobs. As an Educator, I cannot overstate the importance of receiving a quality education to create a path toward a well-paying job. We must ensure jobs meet the daily needs of workers in our state. The workers of California deserve to have a holistic system that supports them. We must identify what jobs we are trying to create and what workforce our economy will need, not only today but in the future. Jobs must offer workers the chance to live a dignified life. In our state for example, AB 378 creates a system that allows child care workers a seat at the bargaining table to ensure that their needs are met in order to develop a workforce for the future. This is a workforce that often does not earn a livable wage and qualifies for the same subsidies as the families they serve. Child care providers are the backbone of our state and a workforce that cannot be outsourced. Without them, we know parents could not get to work, and children would not have an educational foundation before they even step foot in a kindergarten classroom.
Chad Mayes - California State Assemblyman (R-Yucca Valley)
As California continues to transition to a clean, renewable, energy efficient economy we are creating jobs that were unthinkable just a decade ago. At every turn, innovation and market forces has proven the naysayers wrong and that’s why we need to do everything in our power to ensure those entering the work force are prepared to fill those jobs.
To that end, we must redouble our effort to fund Career Technical Education (CTE) and ensure that science, technology, engineering, and mathematics (S.T.E.M.) curriculums remain on pace with the continuing advances in technology taking place before our very eyes.
Cassandra Walker-Pye - Founder and CEO of 3.14 Communications
It’s feels a bit odd responding to a question regarding the creation of jobs/better-paying jobs for working Californians when the state’s unemployment rate has been sitting consistently at or around 4% and when economists continue to issue warnings regarding labor shortages – in the tech field, certainly, but also in sectors like construction and agriculture. Our inability to fill in these shortages could impact our economy as severely as a recession, according to the experts, and the impact could be felt in as little as five years. Training beyond high school is critical, particularly in communities of color which have not participated as fully in the booming New Economy. Creating tangible incentives (institutional and individual) for workers to train for in-demand jobs should be considered. Access to training (i.e., keeping costs low), especially at the community college level, makes a lot of sense as does accelerating the time it takes to receive postsecondary credentials.
Chad Peace - Founder and President of IVC Media LLC
What matters is not how many dollars we have, but what those dollars can buy. In California, our high taxes and heavy regulations make conducting the same business or enjoying the same standard or living more costly than in any other state. The natural consequence is both an exodus of businesses that provide quality jobs and a reduction in real wages. Yet, there has been little retrospection on how effectively our taxes are being used or regulations are carried out. One of the things Sacramento can do to provide incentives for businesses and workers to make their home in California is cut the most wasteful government spending, reduce taxes accordingly, and remove regulations that unnecessarily drive up the cost of doing business.
Jesse Gabriel - California State Assemblyman (D-Los Angeles)
Investing in our state’s public higher education system is one of the most effective steps we can take to create more and better paying jobs in California. Whether it’s technical and vocational education, community college, or a 4-year university, studies have repeatedly demonstrated that higher education opens the door to better, higher-paying jobs. Ensuring broad access to higher education and vocational training is particularly important in enabling Californians to secure advanced manufacturing jobs and compete in a rapidly changing global economy.
California’s colleges and universities—particularly our UC and CSU campuses—are also hotbeds of innovation and entrepreneurship. They are engaged in cutting-edge research and graduate some of the world’s most talented scientists, thinkers, and leaders. They attract employers to California and help spawn new companies and even new industries.
As a member of the Assembly Higher Education Committee, I have been a strong proponent of increasing funding for public higher education. It’s one of the best investments we can make, and a powerful tool to expand opportunity, promote social mobility, and drive economic growth.
Debbie Mesloh - President of the San Francisco Commission on the Status of Women
First, turn the climate crisis into opportunity by harnessing the innovation and leadership of local communities in developing resilient infrastructure for California’s future. This is the infrastructure of solar powered micro grids and distributed water storage that would allow utilities to power down electric transmission during high fire risk periods. And more. Local community-based solutions can provide numerous and good paying jobs and prepare our state for the ongoing reality of wildfires, floods and mudslides. Second, promote and enact policies to unleash the full potential of women. Women are now the primary breadwinners in 40 percent of households, and women’s contributions to the workforce are essential for job growth and economic security. However, our current policies are not conducive to women staying in the workforce, either because it does not make economic sense or they must choose between work and family. A top priority should be enacting Governor Newsom’s paid family leave plan, which would expand paid family leave from six to eight weeks beginning in July 2020, and extend it to six months per child by 2021-22. When we lift up women, we lift up families and our communities.
Manuel Pastor - Director of the University of Southern California’s Program for Environmental and Regional Equity
Let’s baseline the answer with a startling fact: since 1980, average worker productivity in California has gone up roughly ninety percent while real median wages have flatlined. So it’s not just a question of creating better jobs – if better means more productive, we’re making progress – but insuring that employees get a fair return on their efforts in those new jobs.
This concern is reinforced by research by Harvard economist (and MacArthur “genius prize” winner) Raj Chetty. One of the nation’s leading experts on mobility – that is, the likelihood that someone born to modest means will make it to the middle class and above – Chetty demonstrates in his most recent work that the nation’s skewed income distribution of the last few decades has done more damage to mobility than the slowed growth rate in the same period.
None of this should be an excuse for not priming the job pump by encouraging innovation, boosting workforce development, and investing in education. But all of this will fail to deliver on the better-paying part of the equation unless we also tackle the underlying imbalance of power over policy and wage-setting. So let’s grow jobs but let’s also focus on equity.
Steve Westly - former State Controller
For one of the first times in history there are more unfilled jobs in America (6.7M) than available workers to fill them (6.4M). And many of these jobs are highly paid.
The challenge is to provide our workforce with the skills they need to be job ready in the 21st Century. That starts with making sure that our K-12 education system and our community colleges and universities are providing a curriculum to help students learn coding, data analysis, statistics and other skills that will make them competitive with the global workforce in a rapidly changing economy.
We need to understand that our workforce will need to not just compete locally, but globally, and the global economy is moving quickly beyond manufacturing to an information based economy. If California can take the lead in successfully developing and providing a 21st Century curriculum for our workforce, we will continue to lead the global economy—and no place in the world is better able to do this than California.
David Townsend - Democratic consultant and Managing Partner for TCT Public Affairs
What are the elements of a good job…. job training, a living wage, quality health care, a safe workplace and flexibility to provide care and support for children and family members. This will require business, labor and health care providers to leave their current silos and really work together. Business must support living wage proposals. Labor needs to back off from eliminating independent contractors and health care providers need to find ways to cut costs and increase access. Community Colleges should provide more low cost job training classes for the modern workplace. Perhaps the new Governor would create a Task Force/Commission of representatives of these groups to come together, lay down their weapons and old battles and find a common bold solution where everyone loses a little so that everyone can win. Lacking this type of leadership, the old battles will continue to be waged in the Legislature…and will get nowhere.
Luisa Blanco Raynal - Associate Professor for Pepperdine University’s School of Public Policy
One way to create better paying jobs for Californians is to focus on improving the training and skills of workers, so that they meet the needs for the demand of labor in our state. By investing in California workers’ education and training, we can help build a more desirable and qualified workforce, which consequently will result on higher wages. One area that specifically could make a positive impact is training in the health industry. According to recent data from the Bureau of Labor Statistics, the highest paying jobs in the state are in the medical sector. Specific programs that encourage individuals to get a degree that specifically meets the needs of the healthcare and medical sector would be beneficial for the labor force in California. Incentives could be in the form of generous scholarships, student loans or student debt forgiveness for individuals that graduate from qualifying programs that meet the labor demand needs from the medical sector. By focusing on the supply side, where policymakers design programs that make California’s workforce more competitive, which will result on an increase labor productivity, and thus working conditions will improve and more individuals will have access to better paying jobs.
Karthick Ramakrishnan - Founding Director of the Center for Social Innovation at the University of California, Riverside
The good news is that you don’t have to push one solution to the exclusion of the other. In fact, when we did a survey of Southern California voters in 2018, there was broad agreement across Democrats, Republicans, and Independents alike on these two premises: that state and local governments could do more to promote access to good career-technical education, and that these governments also had an important role to play in protecting worker rights. Of course, we can still bring plenty of evidence to bear on the pragmatic question of how we can best promote each type of outcome. But we should try to move away from purely ideological conversations that push one-sided solutions.
Governor Newsom’s recently announced Future of Work commission is an important step forward in this regard, as it will engage labor as well as management, colleges as well as community organizations. And the solutions will likely involve not only the standard mix of incentives and regulations, but also persuasion, praise, and peer learning to help employers, workers, and communities adapt to work environments that are rapidly changing through technology.
Maria Mejia - Los Angeles Director for Gen Next
California businesses operate in competitive and uncertain environments. If we expect business owners to assume the risk and responsibility of creating good jobs, we need to make it easier for them to do so.
First by reducing barriers to play, but also by supporting their growth and agility with smart systems, and by guiding businesses towards model behavior with the use of aggressive incentives that encourage and condition them to hire, and to hire well.
In addition to improving job quality, California should seek to set a new standard for public and private investment in employee development. As California’s demographics change and the workforce grows younger and younger, it is important that we innovate across career pipelines and that we get better at developing our talent, and supporting their economic empowerment over time.
Jim Wunderman - President and CEO of the Bay Area Council
California over the past decade has been a national leader in creating more and better-paying jobs. The reasons are simple. We have invested heavily—from both private and public sources—in education and research. We embrace a culture of innovation, diversity and creativity that spawns new industries and businesses. And we have built robust connections with economic partners around the globe. To continue our jobs-creating leadership, we must double down on these strategies. We need to create much stronger connections between the companies that are creating jobs and the educational institutions and training programs that are preparing our future workforce. California also must act more aggressively to end the housing affordability crisis that is deeply impacting several of our regions, stealing a bigger and bigger share of paychecks and forcing companies to grow jobs elsewhere. And finally, we must hold the line on excess regulation and taxes that punish employers and stifle the very innovation that has made us successful.