Changing labor requirements in Nebraska amid ‘brain drain’ should be cause for concern, researcher says

This story was originally published in the Nebraska Examiner.

LINCOLN. More people are still leaving than are coming to Nebraska from other states, and the biggest loss is for those with at least a bachelor’s degree in education.

The deteriorating trend over the past decade is particularly worrisome as 65% of state and national jobs are likely to require at least some higher education by 2030, researcher Josie Schafer told a meeting of top education officials last week.

Josie Schafer, Ph.D., director of the Center for Public Affairs Research at the University of Nebraska at Omaha. (Courtesy of the UN)

She said that about 33% of jobs in Nebraska today are filled by people with a bachelor’s degree.

“We are losing people,” Schafer said. “And that trend is actually getting worse after COVID.”

“Incredibly Unexpected Bets”

Schafer, who heads the Center for Public Affairs Studies at the University of Nebraska at Omaha, presented an analysis of staffing changes and the state’s challenges to the NU Board of Regents on Friday.

As a result, the number of high-skill jobs is “growing at an incredibly unexpected rate” and that Nebraska’s educational institutions are under pressure to train the next generation of workers and the entire state to attract and retain talent.

Ted Carter, president of the University of Nebraska system, emphasized the urgency, saying that most of the jobs in the country that are likely to be in place by 2040 have not even been invented yet.

“We don’t even know what it is,” he said.

Schafer’s review of future labor and education needs was based on census data and other studies.

Ted Carter, NU President (Courtesy of the University of Nebraska)

The good news, according to Schafer, is that Nebraskans are hardworking. She pointed to the state’s unemployment rate, one of the lowest in the country, and its high labor force participation rate.

She noted that Nebraska ranks second in the nation for a 90% labor force participation rate for people with a bachelor’s degree or higher. (This compares to about 70% for the state as a whole.)

Little huskers grow up

Still, the vacancy rate is 6.7%, she said, which is why organizations like the Nebraska Chamber of Commerce have been focused on filling up to 80,000 vacancies that the state has been unable to fill.

“We have a problem – and there is no reserve of workers that we could suddenly add to this workforce,” Schafer said.

“A clear and constant source of growth for Nebraska” has been international immigration.

Josie Schafer, director of the United Nations Center for Public Affairs

While the population of the state as a whole has grown by about 7% since 2010, the bulk of the counties, 69 out of 93, have lost residents. This has led to uneven growth, with most Nebraskans living in the three largest counties: Douglas, Lancaster, and Sarpee.

Compared to other states, Nebraska is actually doing a good job of keeping its own population growing: Huskers ranked seventh in the nation in 2021 in terms of natural increase, or births minus deaths.

However, problems pile up as little huskers get older.

Nebraska’s most able-bodied working group, 25 to 54, makes up about 43% of the state’s population, with a more ideal proportion of over 50%, according to Schafer. “Because that (means) we have a lot of people in the workforce supporting the youth and supporting our retirement population by allowing people to age on the spot here in Nebraska.”

Problems of tomorrow

The 15- to 19-year-old group heading into the tertiary education stage and then into the mainstream labor force remains fairly stable in size and unevenly represented in urban areas, she said.

“What you can really see is that there aren’t huge numbers of people coming into this workforce in their prime,” she said. “The problems we have today are more likely to be the problems we have tomorrow.”

The scenario gets bleaker with internal migration, as more people leave the state every year since 2010 than have settled in Nebraska from other states.

Who leaves and stays?

For people with four years of education, net migration has been constant and negative, according to Shafer, giving rise to the term “brain drain”.

To put it into perspective, she said, about 400,000 people with a bachelor’s degree or higher work in Nebraska, so the loss of about 4,500 last year wasn’t “huge.” But she said the worrying trend had to be reckoned with.

“Employment opportunities are a big driver of this emigration,” Schafer said.

Immigration is a key driver of growth

In contrast, the positive population influx — “an obvious and constant source of growth for Nebraska” — comes from international immigration, she said.

Last year, according to CPAR data, the state increased by about 4,000 foreign residents, many of whom were attracted by the university system.

Schafer also noted the contrast between current labor demand and that projected for the future.

Today, more Nebraskas work in low-paying jobs (about 553,000) like cooking, office support and manufacturing than in high-paying jobs (about 466,000) like computers, engineering and law, she said.

“This is a difficult position for the economy to grow,” Schafer said, adding that low-wage workers have less purchasing power to help churn the local economy. (Low wages are considered less than the median income, about $41,000 a year, for working people.)

But that balance is “shifting dramatically,” Schafer said, “in Nebraska and elsewhere,” as demand for a more educated workforce increases.

In terms of graduate degrees, she said that Nebraska currently ranks average in the nation, 26th among states for people aged 25 and over with a bachelor’s degree.

Workforce Concern Growing Among Lawmakers

To be sure, the proportion of college graduates and professional degrees in Nebraska has risen. But, according to Schafer, “we will really have to grow dramatically to keep up with the national demand for a highly skilled workforce.”

CPAR research shows that about a third of the state’s working population has some sort of college credit or associate’s degree. This is a key group that the University of Nebraska needs to recruit to further prepare for a four-year or more degree, she said, as they started college and are already in Nebraska. “An opportunity for us for sure.”

International populations and low-income people of color are also opportunities for workforce growth, she said.

Carter counted about 307,000 college-educated Nebraska residents and agreed, “That’s a huge goal for us.”

He said Nebraska has made great strides recently thanks to the Nebraska Promise’s learning hiatus, online education offerings, and legislative incentives for internship programs.

State Senator John Arch, Speaker of the Legislature, told the Regents in an earlier speech that the state’s workforce and the role of the university system is a topic highly praised in the unicameral assembly.

“We need to have a workforce,” said the La Vista MP. “Retention, attraction – all this is simply necessary for our future as a state.”

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