There are approximately 20 million Americans employed in key service-sector industries who lack foundational skills in literacy, numeracy, or digital problem-solving. These skill gaps serve as an invisible drag on productivity, often limiting workers’ ability to climb the career ladder and increasing employer costs.
Businesses play an important role in helping these workers build skills and attain economic mobility – and smart public policy can amplify employer investments while also strengthening talent pipelines across the sector.
That’s the overview of a new report from National Skills Coalition. Foundational Skills in the Service Sector: Understanding and Addressing the Impact of Limited Math, Reading, and Technology Proficiency on Workers and Employers focuses on retail, hospitality, and healthcare workers.
The report is designed to inform business leaders, policymakers, and advocates who are addressing challenges faced by workers with skill gaps and their employers. It provides a detailed data profile of workers, examples of employer interventions that support skill-building, and recommendations for state and federal policymakers.
What the Data Tell Us
- Low skills are prevalent among service-sector workers: 62% of workers in the target occupational categories have low literacy, 74% have low numeracy, and 73% have limited digital problem-solving skills.
- Most low-skilled workers are age 25 or older, including 52% who are over the age of 35. A majority (61%) are women. Two-thirds (64%) are parents.
- Nearly a quarter (23%) of low-skilled workers are supervisors. A majority (58%) have been with their current employer for at least 3 years.
- Many are eager to improve their skills. More than one in three (39%) participated in a learning activity over the past 12 months, including 27% who are pursuing a formal degree or certificate.
How Employers Are Responding
Companies that are successfully addressing skill gaps among their workforce are using a variety of tools. A key way to offer high-quality upskilling opportunities to their employees is through partnerships with nonprofit organizations, community colleges, and other training providers. Among the examples detailed in the report:
- Employers can participate in sector partnerships such as BEST Corp. Hospitality Training Center. These partnerships are especially important for small and mid-sized employers that cannot easily provide on-site training.
- Employers can participate in apprenticeship or other work-based learning programs, such as that offered by Susque-View, a long-term care provider.
- Employers can collaborate to offer Vocational English as a Second Language (VESL) classes, such as those offered by Kroger, Publix, and Whole Foods via the New American Workforce initiative; and/or offer blended learning approaches that combine in-person classes and online learning, such as English Innovations.
What Policymakers and Advocates Can Do
Public policies are a crucial tool for amplifying employer investments and ensuring that all workers can participate in skill-building opportunities, regardless of the size or capacity of their employer. Recommendations in NSC’s report include:
- Expanding industry sector partnerships through improved alignment and increased public investment
- Making it easier for workers to navigate career pathways, including transitions from adult basic education to middle-skill training
- Expanding financial aid to be more responsive to working learners and businesses
- Supporting the expansion of apprenticeships and other work-based learning opportunities
Learn more about NSC’s findings and recommendations in the full report.
This paper was made possible by generous support from the Walmart Foundation. We thank them for their support but acknowledge that the findings, conclusions, and recommendations presented in the report are those of NSC alone, and do not necessarily reflect the opinions of the Walmart Foundation.