• <div class="header-image" style="background-image: url(/live/image/gid/4/2897_V6N9_Header.rev.1540219621.jpg);">​</div><div class="header-background-color"/>

Higher Education and Low Skills: Are U.S. College Graduates Unprepared for the Economy?

October 18, 2018
Reading the temperature on a mercury thermometer. Understanding product reviews. Navigating online job search sites. These all seem simple enough, but many U.S. adults struggle to complete daily tasks such as these. Results from the Program for the International Assessment of Adult Competencies (PIAAC), a multi-country survey of adults conducted by the Organization for Economic Cooperation and Development (OECD), showed that large shares of the U.S. population lacked proficiency in a range of core competencies including literacy, numeracy, and problem-solving.[1]

Survey results revealed that nearly half (46%) of U.S. young adults (ages 16 to 34) were unable to successfully complete moderately complex literacy tasks, as indicated by scoring below Level 3 proficiency on the PIAAC literacy subtest. Level 3 tasks require those surveyed to “identify, interpret, or evaluate one or more pieces of information, and often require varying levels of inference.”[2] Among those with college credentials, approximately one out of three associate’s degree holders and one out of five bachelor’s degree holders failed to meet this threshold of moderate proficiency.
Image: Literacy proficiency of U.S. young adults, Source: U.S. Department of Education, National Center for Education Statistics (Figure 8a, p. 16).Image: Literacy proficiency of U.S. young adults, Source: U.S. Department of Education, National Center for Education Statistics (Figure 8a, p. 16).

Even more college graduates fell below Level 3 proficiency on the PIAAC numeracy subtest: nearly half (48%) of associate’s degree holders and one-third (30%) of bachelor’s degree holders. Numeracy is defined as “the ability to access, use, interpret, and communicate mathematical information and ideas, to engage in and manage mathematical demands of a range of situations in adult life.”[3] Similar shares of U.S. young adults underperformed on problem-solving tasks administered via computer. Even college-educated adults found it difficult to use digital technologies to evaluate information, effectively communicate with others, and perform routine tasks.[4] More than half (52%) of associate’s degree holders and one-third (34%) of bachelor’s degree holders failed to meet Level 2 proficiency on digital problem-solving tasks of moderate difficulty (e.g., downloading music files on a portable music player).[5]

In general, when compared internationally, the skills of U.S. adults were in the middle of the pack. Among the 22 OECD countries that participated in the first wave of the PIAAC survey, U.S. college-educated adults in their 20s scored about average in literacy, but below average in numeracy. For example, among adults in their 20s with at least an associate’s degree, the U.S. outperformed only one country (Slovakia) in numeracy scores and trailed leading countries such as Austria, Finland, and Sweden.

Image: PIAAC numeracy scores by country and education attainment level, Source: U.S. Department of Education, National Center for Education Statistics (Figure 3b, p. 8)Image: PIAAC numeracy scores by country and education attainment level, Source: U.S. Department of Education, National Center for Education Statistics (Figure 3b, p. 8)

The low literacy, numeracy, and problem-solving skills of the youngest U.S. adult cohort present a challenge to America’s social and economic outlook. Compared to highly skilled adults, those with low skills are more likely to be unemployed or working in low-skill occupations that garner low wages, and these challenges ultimately limit the prospects for economic self-sufficiency and upward mobility.[6] Low-skilled adults also report poorer physical and mental health and lower civic engagement, which directly affect a nation’s publicly funded health care programs and democratic processes.[7][8][9]

The PIAAC assessment results are a sobering reminder that millions of U.S. adults—even those with college degrees—are ill-equipped to fully benefit from or participate in U.S. social and economic life. For example, technological advancements and global trade have transformed the U.S. economy and placed greater demands for new skills and competencies required for employment.[10][11] Results from the 2018 Job Outlook survey conducted by the National Association of Colleges and Employers show that organizations are seeking job candidates with problem-solving skills, the most desired attribute recorded (83%). Other desirable qualities employers seek include written communication skills (80%), analytical/quantitative skills (68%), and verbal communication skills (68%).[12]

So what does this mean for U.S. policy and educational practice? First, policymakers need to recognize that large segments of the young adult U.S. population are not proficient in key competencies that are necessary to successfully navigate work and life. Then, the country must make greater investments in developing the human capital of its residents through education and training. To combat low skill proficiency, OECD offers broad policy recommendations that include providing high-quality early childhood education and opportunities for lifelong learning so that low-skilled individuals may continue to develop proficiency in key competencies throughout their life.

While there is a positive association between level of education and skill proficiency, it is disconcerting that sizeable shares of college-educated young adults were found to be unable to carry out moderately difficult literacy, numeracy, and problem-solving tasks.[13] These skill deficiencies raise questions about the validity of the college credential. Relying on measures of students’ demonstrated competencies rather than credit hours accrued might better define when students should receive a postsecondary credential and be ready to enter the workforce.[14]

Ensuring that college credentials represent meaningful skill proficiency is important, but efforts to ensure skill development of individuals outside the formal U.S. higher education system are also important. Stakeholders from government and industry should invest in adult education programs that help low-skilled individuals become trained for success in the workplace and college.[15] Walmart is a notable recent example of employer-assisted training; the company subsidized employees’ pursuit of online associate’s and bachelor’s degrees in business and supply chain management.[16]

Too many U.S. young adults are ill-prepared for the demands of the globally competitive economy by lacking proficiency in required key competencies. The U.S. must do more to ensure all Americans benefit from high-quality educational experiences from early childhood though college and later adulthood.

Student Blog Disclaimer
  • The views expressed on the Student Blog are the author’s opinions and don’t necessarily represent the Penn Wharton Public Policy Initiative’s strategies, recommendations, or opinions.

References

  [1]https://nces.ed.gov/pubs2016/2016039rev.pdf

  [2]https://nces.ed.gov/surveys/piaac/litproficiencylevel.asp

  [3]https://nces.ed.gov/surveys/piaac/numeracy.asp

  [4]https://nces.ed.gov/surveys/piaac/problem-solving.asp

  [5]https://nces.ed.gov/surveys/piaac/sample_pstre.asp

  [6]https://www.ets.org/s/research/report/opportunity-too-big-to-fail.pdf

  [7]http://www.oecd.org/skills/piaac/SkillsOutlook_2013_ebook.pdf

  [8]https://www.npr.org/sections/goatsandsoda/2017/04/20/524774195/what-country-spends-the-most-and-least-on-health-care-per-person

  [9]http://www.oecd.org/education/innovation-education/37425694.pdf

  [10]https://www.cfr.org/report/the-work-ahead/report/findings.html

  [11]https://www.dol.gov/oasam/programs/history/herman/reports/futurework/conference/trends/trendsVII.htm

  [12]http://careerservices.wayne.edu/pdfs/2018-nace-job-outlook-survey.pdf

  [13]https://nces.ed.gov/pubs2018/2018007.pdf

  [14]https://www.in.gov/che/files/2016_RHDV_Report_Competency.pdf

  [15]https://jfforg-prod-prime.s3.amazonaws.com/media/documents/adult_ed_work_guide.pdf

  [16]https://www.forbes.com/sites/zackfriedman/2018/05/31/walmart-college/#3713640b6204

PENN WHARTON PPI
RESOURCE SPOTLIGHT:

  • <h3>The World Bank Data (U.S.)</h3><p><img width="130" height="118" alt="" src="/live/image/gid/4/width/130/height/118/484_world-bank-logo.rev.1407788945.jpg" class="lw_image lw_image484 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/130/height/118/484_world-bank-logo.rev.1407788945.jpg 2x, /live/image/scale/3x/gid/4/width/130/height/118/484_world-bank-logo.rev.1407788945.jpg 3x" data-max-w="1406" data-max-h="1275"/>The <strong>World Bank</strong> provides World Development Indicators, Surveys, and data on Finances and Climate Change.</p><p> Quick link: <a href="http://data.worldbank.org/country/united-states" target="_blank">http://data.worldbank.org/country/united-states</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>Federal Reserve Economic Data (FRED®)</h3><p><strong><img width="180" height="79" alt="" src="/live/image/gid/4/width/180/height/79/481_fred-logo.rev.1407788243.jpg" class="lw_image lw_image481 lw_align_right" data-max-w="222" data-max-h="97"/>An online database consisting of more than 72,000 economic data time series from 54 national, international, public, and private sources.</strong> FRED®, created and maintained by Research Department at the Federal Reserve Bank of St. Louis, goes far beyond simply providing data: It combines data with a powerful mix of tools that help the user understand, interact with, display, and disseminate the data.</p><p> Quick link to data page: <a href="http://research.stlouisfed.org/fred2/tags/series" target="_blank">http://research.stlouisfed.org/fred2/tags/series</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>USDA Nutrition Assistance Data</h3><p><img width="180" height="124" alt="" src="/live/image/gid/4/width/180/height/124/485_usda_logo.rev.1407789238.jpg" class="lw_image lw_image485 lw_align_right" srcset="/live/image/scale/2x/gid/4/width/180/height/124/485_usda_logo.rev.1407789238.jpg 2x, /live/image/scale/3x/gid/4/width/180/height/124/485_usda_logo.rev.1407789238.jpg 3x" data-max-w="1233" data-max-h="850"/>Data and research regarding the following <strong>USDA Nutrition Assistance</strong> programs are available through this site:</p><ul><li>Supplemental Nutrition Assistance Program (SNAP) </li><li>Food Distribution Programs </li><li>School Meals </li><li>Women, Infants and Children </li></ul><p> Quick link: <a href="http://www.fns.usda.gov/data-and-statistics" target="_blank">http://www.fns.usda.gov/data-and-statistics</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>The Penn World Table</h3><p> The Penn World Table provides purchasing power parity and national income accounts converted to international prices for 189 countries/territories for some or all of the years 1950-2010.</p><p><a href="https://pwt.sas.upenn.edu/php_site/pwt71/pwt71_form.php" target="_blank">Quick link.</a> </p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>Internal Revenue Service: Tax Statistics</h3><p><img width="155" height="200" alt="" src="/live/image/gid/4/width/155/height/200/486_irs_logo.rev.1407789424.jpg" class="lw_image lw_image486 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/155/height/200/486_irs_logo.rev.1407789424.jpg 2x" data-max-w="463" data-max-h="596"/>Find statistics on business tax, individual tax, charitable and exempt organizations, IRS operations and budget, and income (SOI), as well as statistics by form, products, publications, papers, and other IRS data.</p><p> Quick link to <strong>Tax Statistics, where you will find a wide range of tables, articles, and data</strong> that describe and measure elements of the U.S. tax system: <a href="http://www.irs.gov/uac/Tax-Stats-2" target="_blank">http://www.irs.gov/uac/Tax-Stats-2</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>HUD State of the Cities Data Systems</h3><p><strong><img width="200" height="200" alt="" src="/live/image/gid/4/width/200/height/200/482_hud_logo.rev.1407788472.jpg" class="lw_image lw_image482 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/200/height/200/482_hud_logo.rev.1407788472.jpg 2x, /live/image/scale/3x/gid/4/width/200/height/200/482_hud_logo.rev.1407788472.jpg 3x" data-max-w="612" data-max-h="613"/>The SOCDS provides data for individual Metropolitan Areas, Central Cities, and Suburbs.</strong> It is a portal for non-national data made available through a number of outside institutions (e.g. Census, BLS, FBI and others).</p><p> Quick link: <a href="http://www.huduser.org/portal/datasets/socds.html" target="_blank">http://www.huduser.org/portal/datasets/socds.html</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>National Center for Education Statistics</h3><p><strong><img width="400" height="80" alt="" src="/live/image/gid/4/width/400/height/80/479_nces.rev.1407787656.jpg" class="lw_image lw_image479 lw_align_right" data-max-w="400" data-max-h="80"/>The National Center for Education Statistics (NCES) is the primary federal entity for collecting and analyzing data related to education in the U.S. and other nations.</strong> NCES is located within the U.S. Department of Education and the Institute of Education Sciences. NCES has an extensive Statistical Standards Program that consults and advises on methodological and statistical aspects involved in the design, collection, and analysis of data collections in the Center. To learn more about the NCES, <a href="http://nces.ed.gov/about/" target="_blank">click here</a>.</p><p> Quick link to NCES Data Tools: <a href="http://nces.ed.gov/datatools/index.asp?DataToolSectionID=4" target="_blank">http://nces.ed.gov/datatools/index.asp?DataToolSectionID=4</a></p><p> Quick link to Quick Tables and Figures: <a href="http://nces.ed.gov/quicktables/" target="_blank">http://nces.ed.gov/quicktables/</a></p><p> Quick link to NCES Fast Facts (Note: The primary purpose of the Fast Facts website is to provide users with concise information on a range of educational issues, from early childhood to adult learning.): <a href="http://nces.ed.gov/fastfacts/" target="_blank">http://nces.ed.gov/fastfacts/#</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>National Bureau of Economic Research (Public Use Data Archive)</h3><p><img width="180" height="43" alt="" src="/live/image/gid/4/width/180/height/43/478_nber.rev.1407530465.jpg" class="lw_image lw_image478 lw_align_right" data-max-w="329" data-max-h="79"/>Founded in 1920, the <strong>National Bureau of Economic Research</strong> is a private, nonprofit, nonpartisan research organization dedicated to promoting a greater understanding of how the economy works. The NBER is committed to undertaking and disseminating unbiased economic research among public policymakers, business professionals, and the academic community.</p><p> Quick Link to <strong>Public Use Data Archive</strong>: <a href="http://www.nber.org/data/" target="_blank">http://www.nber.org/data/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>NOAA National Climatic Data Center</h3><p><img width="200" height="198" alt="" src="/live/image/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg" class="lw_image lw_image483 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg 2x, /live/image/scale/3x/gid/4/width/200/height/198/483_noaa_logo.rev.1407788692.jpg 3x" data-max-w="954" data-max-h="945"/>NOAA’s National Climatic Data Center (NCDC) is responsible for preserving, monitoring, assessing, and providing public access to the Nation’s treasure of <strong>climate and historical weather data and information</strong>.</p><p> Quick link to home page: <a href="http://www.ncdc.noaa.gov/" target="_blank">http://www.ncdc.noaa.gov/</a></p><p> Quick link to NCDC’s climate and weather datasets, products, and various web pages and resources: <a href="http://www.ncdc.noaa.gov/data-access/quick-links" target="_blank">http://www.ncdc.noaa.gov/data-access/quick-links</a></p><p> Quick link to Text & Map Search: <a href="http://www.ncdc.noaa.gov/cdo-web/" target="_blank">http://www.ncdc.noaa.gov/cdo-web/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>Congressional Budget Office</h3><p><img width="180" height="180" alt="" src="/live/image/gid/4/width/180/height/180/380_cbo-logo.rev.1406822035.jpg" class="lw_image lw_image380 lw_align_right" data-max-w="180" data-max-h="180"/>Since its founding in 1974, the Congressional Budget Office (CBO) has produced independent analyses of budgetary and economic issues to support the Congressional budget process.</p><p> The agency is strictly nonpartisan and conducts objective, impartial analysis, which is evident in each of the dozens of reports and hundreds of cost estimates that its economists and policy analysts produce each year. CBO does not make policy recommendations, and each report and cost estimate discloses the agency’s assumptions and methodologies. <strong>CBO provides budgetary and economic information in a variety of ways and at various points in the legislative process.</strong> Products include baseline budget projections and economic forecasts, analysis of the President’s budget, cost estimates, analysis of federal mandates, working papers, and more.</p><p> Quick link to Products page: <a href="http://www.cbo.gov/about/our-products" target="_blank">http://www.cbo.gov/about/our-products</a></p><p> Quick link to Topics: <a href="http://www.cbo.gov/topics" target="_blank">http://www.cbo.gov/topics</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>Federal Aviation Administration: Accident & Incident Data</h3><p><img width="100" height="100" alt="" src="/live/image/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg" class="lw_image lw_image80 lw_align_left" srcset="/live/image/scale/2x/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg 2x, /live/image/scale/3x/gid/4/width/100/height/100/80_faa-logo.rev.1402681347.jpg 3x" data-max-w="550" data-max-h="550"/>The NTSB issues an accident report following each investigation. These reports are available online for reports issued since 1996, with older reports coming online soon. The reports listing is sortable by the event date, report date, city, and state.</p><p> Quick link: <a href="http://www.faa.gov/data_research/accident_incident/" target="_blank">http://www.faa.gov/data_research/accident_incident/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>
  • <h3>MapStats</h3><p> A feature of FedStats, MapStats allows users to search for <strong>state, county, city, congressional district, or Federal judicial district data</strong> (demographic, economic, and geographic).</p><p> Quick link: <a href="http://www.fedstats.gov/mapstats/" target="_blank">http://www.fedstats.gov/mapstats/</a></p><p>See all <a href="/data-resources/">data and resources</a> »</p>