Workers who lack four-year college degrees might have better job prospects in the Kansas City area than anywhere else in the country.
A study released Wednesday by the Federal Reserve Banks of Philadelphia, Cleveland and Atlanta ranked Kansas City as the nation’s top metropolitan area for employment opportunities for workers without bachelor’s degrees to earn at least the median wage for the area.
Among 100 U.S. metro areas studied, the Kansas City metro area had the highest “opportunity occupation” measure calculated by Fed researchers, indicating that about one-third of the area’s jobs are accessible to such workers, who comprise about 70 percent of the adult population.
“To be at the top of the list means that your economy is working better for workers with a lower level of education,” said Keith Wardrip, community development research manager at the Philadelphia Fed.
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But it doesn’t necessarily mean that the area’s overall economy is stronger than average.
The report said that cities with the largest shares of such “opportunity occupation” jobs generally have had lower population growth, lower employment growth, and lower housing-price growth in recent years than cities which have low “opportunity” shares.
Along with Kansas City, other cities in the high-share group include St. Louis, Cleveland and Baton Rouge, La.
Some of the poorest job opportunities for workers without bachelor degrees were found in New York, California and Texas. Their low share of median-income-or-better jobs for workers without bachelor’s degrees could indicate a lot of professional jobs that require four-year degrees or a lot of low-skill jobs that wouldn’t come close to median-wage pay.
The study said the national annual median wage last year was $35,540. The Fed researchers used a cost-of-living adjustment to factor the Kansas City area’s median wage at 7 percent lower, or about $33,000 a year.
Fed researchers analyzed education requirements included in job postings, wage information, and the share of occupations in each city to arrive at the ratings.
“Among 10 of the largest occupations in Kansas City, three are classified as opportunity occupations — customer service, registered nurses, secretary and administrative assistants,” Wardrip said. “General and operations management are also a strong sector.”
The report was driven by data from the U.S. Bureau of Labor Statistics and the Employment & Training Administration’s Occupational Information Network coupled with information from Burning Glass Technologies, which tracks online job ads.
One reason for Kansas City’s high share of “opportunity” employment could be the area’s relatively strong community college systems that work with employers to train workers who require two-year, rather than four-year, degrees or other credentialing to qualify for specific jobs.
“This is great to hear,” said Sandee Woods, college relations coordinator at Metropolitan Community College’s Business & Technology campus. “I can give you a list of what we call ‘gold-collar’ jobs that pay $30,000 to $70,000 a year after two years of career and technical education. And there’s an 8 percent projected growth rate in these jobs.”
The strong presence in the Kansas City area of two automotive assembly plants, a growing information technology sector, and plenty of “back office” employment also may contribute to the high share of jobs that don’t require four-year degrees, suggested economists at the Mid-America Regional Council in Kansas City.
Economists Frank Lenk and Jeff Pinkerton said the Fed analysis dovetailed with a report they distributed earlier this year. They found that a whopping 89 percent of jobs in the growing motor vehicle manufacturing industry didn’t require a bachelor’s degree.
According to the Fed report:
“Considering manufacturing’s decline over the past half century, it is quite interesting to note that those metros with higher shares of opportunity occupations also have higher concentrations of employment in manufacturing…Moreover, high opportunity occupation metros tend to have higher levels of education along with lower levels of poverty and wage inequality.”
Lenk pointed out that the Kansas City area’s percentage of people who hold bachelor’s degrees is actually higher than the national average, so it’s not that workers in the area are less educated. Also, the median household income in the area is higher than average compared with its peer cities, so it’s not as if wage rates are relatively low.
The Fed report also threw a bit of cold water on a trend that had been widely reported since the 2008 recession — that employers were “upcredentialing,” or requiring more education than actually necessary for the job as a means to winnow out applicants.
The new research found the education requirements are relaxing for “opportunity” jobs. It found significant increases in the share of online jobs requesting less than a bachelor’s degree.
“This study presents preliminary evidence that for workers who lack a bachelor’s degree but seek employment at a decent wage, not all economies are created equal,” the Fed authors wrote. “An economy that provides opportunity for these workers could be seen as a real asset to attract active labor force participants from other areas or to retain — and potentially retrain — current residents.”
The report also raised the possibility that employers will continue to require bachelor’s degrees as a “proxy” for more intangible skills, such as reasoning, self-direction, tenacity or basic intelligence.
That’s the kind of question that requires further exploration, Wardrip said.
Share of total employment that provides workers without bachelor’s degrees access to jobs paying at least median wage:
Kansas City: 36.6 percent
Des Moines: 36.5 percent
Cleveland: 36.2 percent
St. Louis: 35.9 percent
Baton Rouge, La.: 35.7 percent
Source: “Identifying Opportunity Occupations in the Nation’s Largest Metropolitan Economies,” Federal Reserve Banks of Philadelphia, Cleveland and Atlanta.