‘Perfect storm’ threatens US living standards
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‘Perfect storm’ threatens US living standards -- report
Agence France-Presse
Last updated 06:20pm (Mla time) 02/08/2007
WASHINGTON -- A "perfect storm" of falling literacy, the changing structure of the economy and rapid immigration threatens to sharply cut US competitiveness and lower living standards, according to a report released Wednesday.
The report by influential education institute ETS argues that the education system is not preparing enough people for the changing economy and job market, risking "dire consequences" for the United States.
"Unless we do something about it, this society could be swamped," said Kurt Landgraf, Educational Testing Service president.
Entitled "America's Perfect Storm," the report details three key factors that could result in lower competitiveness in the global economy and a falling standard of living in the country:
• Falling literacy levels and a low high school graduation rate, with especially reading and mathematics skills insufficient for dealing with increasingly complex but life issues like personal health care management and retirement planning;
• A quickly changing structure of jobs in the economy, driven by globalization, that rewards much higher-educated people and so is expanding the divide between the most skilled and the least skilled workers; and
• Sweeping demographic changes resulting from high levels of immigration, with a large number of immigrants lacking the education and language abilities needed to fit into the evolving economy.
"Although each of these forces is powerful in its own right, it is their interaction over time that can have momentous consequences," the report said.
The report predicts that over the next quarter-century, the average level of literacy and math ability will fall five percent across the country, due to the arrival of largely uneducated immigrants and the departure from the labor force of the post-World War II baby-boomer generation.
"Over the next 25 years or so, as better-educated individuals leave the workforce they will be replaced by those who, on average, have lower levels of education and skill," the report said.
One result, it said, would be a shrinking middle class, and expansion of the economic divide between the upper and lower classes.
"The lack of education, the lack of jobs, the population demographics are going to cause our country to have really two segments: upper class income people and a whole very large lower class group who can't get good jobs and don't make good salaries, and that's trouble for this country," Landgraf said.
The report highlighted shortfalls in the US education system, which has a high school graduation rate of only 70 percent, ranking the United States 16th out of 21 countries in the Organization for Economic Co-operation and Development, according to a recent OECD report.
The ETS report notes that less than half of the people in the principal immigrant group, Hispanics, have high school diplomas. Of those without diplomas, almost 80 percent learn little or no English.
That will be a drag on the economy and US living standards, according to Landgraf, who said the US needs to take action to reform the education system, immigration policy and the economy.
"We're losing manufacturing jobs to other countries, particularly in Asia. ... Our wage rates and social security benefits make us globally non-competitive. We've got to do something to improve productivity so we can bring back jobs to the middle class into America.
"It's becoming a huge problem. That's why we call it the perfect storm," Landgraf said.
