A skilled workforce is a critical component of regional economic growth. Many jobs that once required only a high school degree now require additional training or a postsecondary education. Ensuring that Chicago's workforce has access to these opportunities will prepare the region to compete in the global economy.
The proportion of residents in the Chicago region and peer metropolitan areas age 25 and older holding high school, associate, bachelor, and advanced degrees.
Why it matters
Higher levels of educational attainment indicate a skilled workforce and contribute to regional economic prosperity. The proportion of the Chicago region's residents holding postsecondary degrees lags behind Boston and Washington, D.C., and exceeds the rate in Los Angeles. A growing number of jobs nationwide and in the region require a postsecondary education.
Higher levels of educational attainment create benefits for both individuals and regional economies. As an individual's educational attainment increases, his or her earnings grow, and the likelihood of unemployment decreases. On a regional scale, higher levels of educational attainment translate to lower unemployment rates and greater economic output.
Developing and maintaining an educated workforce is a critical component of business growth and attraction. A 2012 IBM survey of CEOs, for example, found that, when asked about their business' key source of economic value, human capital was the most frequently identified asset, more so than customer relationships, technology, innovation, or research and development. In today's competitive economic climate, regions that develop and maintain a skilled workforce have a competitive advantage.
The U.S. economy is experiencing a gradual employment transition away from manufacturing toward service sector occupations, which has increased demand for workers with postsecondary educations. Although manufacturing output is near all-time highs, the share of employees working in manufacturing occupations has steadily declined relative to employment in service sector jobs, such as health care, finance, business services, and education. During the 1940s, approximately 60 percent of the nation's employment was in the service sector. That proportion has risen to over 80 percent today.
Postsecondary degree attainment rates in the Chicago region and most other large metropolitan areas exceed national averages. Although metropolitan Chicago fares well compared to national averages, the region finds itself in the middle of the pack among peer metropolitan areas at each level of degree attainment. Associate and bachelor degree attainment rates among Chicago and its peer regions are relatively similar. Advanced degree attainment rates exhibit much greater variability, however. An estimated 14.8 percent of the region's population age 25 and older holds an advanced degree, placing it behind New York (15.7), Boston (20.2), and Washington, D.C. (24.0). Advanced degree holders play an important role in regional economies because they have the highest potential to be job creators, either directly by starting a new company or indirectly by increasing demand for goods and services in the local economy.
Since 2001, jobs requiring an associate degree or higher in the Chicago region have grown more quickly than jobs requiring less than an associate degree. The chart below illustrates this trend and highlights the significant impact that the most recent recession had on jobs with lower postsecondary education requirements. Between 2007-10, regional employment in occupations requiring less than an associate degree declined more rapidly than in any other educational cohort. Although the labor market has experienced recovery in recent years, jobs requiring less than an associate degree have yet to return to their 2001 levels.
Jobs requiring an associate degree fared slightly better than those requiring a bachelor degree during the recession. This is due in part to the large number of health care jobs in the associate degree group. CMAP analysis found that over 60 percent of associate degree occupations in the region are in health care. While consumers and businesses generally cut back spending during recessions, people tend to continue seeking medical care, which makes medical occupations less susceptible to recessions. Among advanced degree holders, the recession slowed employment growth, but did not reverse it as it did for other occupation groups. The most robust employment growth in the region has come from jobs requiring an advanced degree, which grew by 17.1 percent since 2001.
About the Data
Educational attainment in metropolitan regions is tracked by estimating the proportion of a region's population of residents age 25 and older holding high school, associate, bachelor, or advanced degree. A key missing component of this data is information on certifications utilized in manufacturing, STEM occupations, and other growing areas of the economy. While most individuals traditionally pursue an associate or bachelor degree, the education system is rapidly changing and now offers postsecondary certifications in specific fields. By themselves, these certifications do not amount to an official degree, yet they can be a significant asset for jobseekers. The lack of credentialing data availability highlights a key limitation of tracking educational attainment using traditional degree measurements.
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The proportion of working-age residents (20 to 64 years old) who are currently employed or looking for work.
Why it matters
In 2014, approximately 80 percent of the region's working-age residents were either employed or actively looking for work. Metropolitan Chicago's workforce participation rate exceeds that of Los Angeles and New York, but falls short of participation rates in Boston and Washington, D.C. Higher levels of workforce participation are generally seen as a positive indicator of regional economic opportunity.
National and Regional Trends in Workforce Participation
Workforce participation is often a helpful measure for contextualizing unemployment rates. High levels of workforce participation are often seen as a sign that people in the labor market are optimistic about their chances of finding work. In general, workforce participation rates tend to increase during periods of economic growth as more individuals choose to work. Inversely, participation rates can decline during economic downturns as jobseekers become discouraged by poor employment prospects and choose to stop looking for work.
Between 2006-13, workforce participation for persons aged 20 to 64 peaked both nationwide and in the region in 2008, prior to the start of the recession. Since the start of the recession, national workforce participation has seen a continual decline and now stands at 76.8 percent. Workforce participation in the Chicago region also declined during the recession, although the rate rebounded slightly between 2011-12. The data now show a statistically significant decline in workforce participation for the Chicago region over the last two years, however.
Workforce Participation in other Metropolitan Areas
The region's workforce participation rate exceeds the national average and exceeds participation rates in peer regions like New York and Los Angeles. Other peer regions such as Washington, D.C., and Boston have slightly higher workforce participation rates.
About the Data
There are many caveats to note when analyzing workforce participation statistics. Decreasing workforce participation is generally attributed to an increasing number of discouraged workers. When workers cannot find jobs and give up their search, they are no longer counted as part of the workforce, which leads workforce participation rates to decline. Lower workforce participation rates can also be attributed to positive factors, however, such as an increasing number of people choosing to forego work in order to pursue a postsecondary education, early retirement, or families having enough economic stability to stay home and care for children or the infirm. In general, higher rates of workforce participation are seen as beneficial for a regional economy as higher rates constitute a larger supply of workers.
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The estimated number of full- and part-time jobs in the seven-county CMAP region and peer metropolitan areas.
Why it matters
Growing job counts indicate that businesses are hiring and that the region's economy is growing. Although the Chicago region has experienced several consecutive years of job growth since the 2007-09 recession, job growth rates since 2001 lag far behind job growth rates in peer metropolitan areas.
Regional Trends in Employment
Total job counts in metropolitan areas tend to follow national economic trends. During the early 2000s recession, employment in the Chicago, New York, Los Angeles, and Boston metropolitan areas declined slightly before experiencing moderate growth until 2007. The 2007-09 recession erased much of this growth for Chicago and its peers. These effects of the later recession were especially severe in Chicago and Los Angeles, with the Chicago region losing 7.2 percent of its jobs and the Los Angeles metropolitan area losing 8.1 percent of its jobs. Since 2010, jobs counts in Chicago and peer regions have grown. The total number of jobs in metropolitan Chicago has only this year returned to 2001 levels, while peer regions have registered higher job counts compared to 2001 totals.
While the number of jobs in the region is increasing, the available data do not indicate the quality or average pay of jobs created. Total job counts may increase from newly created part-time, low-wage jobs, or the creation of good-paying full-time jobs. Measuring total jobs provides a high-level perspective on the health of employment in the region.
About the Data
Total jobs data are reported by Economic Modeling Specialists International and are primarily based on data from the U.S. Bureau of Labor Statistics Quarterly Census of Employment and Wages, the U.S. Bureau of Economic Analysis, and EMSI proprietary sources. The data report the sum of full- and part-time positions. Data for metropolitan Chicago includes only the seven counties of northeastern Illinois; all other regions reflect U.S. Census Bureau metropolitan statistical areas (MSAs).
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