Goodwill CEO analyzes the labor market
Steve Preston, Goodwill President and CEO joins Yahoo Finance to discuss the latest jobs report.
Video Transcript
- The jobs report out this morning missing expectations by a wide margin. We heard from President Biden earlier. He blamed the Delta variant as part of the reason for the slowdown. We want to talk about that, and what's needed to get millions of people back to work. And for that, we want to bring in Steve Preston. He's the CEO and president of Goodwill. And Steve, it's great to see you again. Last time we were speaking, you were talking about what Goodwill is doing to get hopefully more than a million people back into the workforce.
When you take a look at the jobs number that was out this morning, only 235,000 jobs were added to the economy. More than eight million people are still out of work. What do you think is going on here?
STEVE PRESTON: Well, you know, we missed the mark significantly, and the results do have the Delta variant fingerprints all over them. We've made some progress, but we're seeing that the gap really continue, and in fact expanding in a lot of areas where people come together. And it's often areas, actually, where lower-skilled workers find employment. So retail, restaurants, hospitality, leisure. And so it really does feel very strongly like the pandemic is, once again, putting a pressure on the growth that we've seen over the last several months.
- Well, and we've seen corporations, businesses that are hiring really just adjusting their standards to accommodate the shortage of workers. I'm just wondering what the dynamics is within the pool of workers that you're assisting.
STEVE PRESTON: So I think that's a very important point. But I think it's also important, when people say they're adjusting the standards, it doesn't necessarily mean that they're getting a lesser-quality worker. What a lot of corporations have begun to realize is they're posting for jobs and they're requiring things like bachelor's degrees where it's not really required, or other kinds of credentials that really aren't necessary.
Dozens of major corporations have to come out and said, we're going to begin hiring for skills. We're going to change the way we advertise for those. And as a result, we're going to think differently and more broadly about who really does qualify for those jobs. And it's less of an issue of sort of reaching down further, and more of an issue of understanding, really, who can compete.
The other area, I think, that many employers are beginning to consider are people groups that they haven't considered in the past. A lot of employers have come forward and said, you know what? We started hiring people who have had a history of incarceration, and actually found that many of those people are doing just as well or better than the rest of our population, because of loyalty and any number of issues.
So some of the most successful employers are just kind of taking a step back and saying, how have we done this historically? Is it the right way? And have we really blocked many groups of potentially very strong employees out of it, for reasons that really we need to reconsider?
- Steve, in terms of what could be keeping people on the sidelines and keeping them from re-entering the workforce, from the people that you are talking to, how much of it has to do with child care? I guess how big of a barrier to entry is that right now?
STEVE PRESTON: Yeah, child care and broader family care continues to be a significant issue in any of the surveys we see. It's one of the reasons why people continue to seek more flexibility from their employers. And I think the other thing is, because of what we've seen over the last year plus, people's expectations have changed around their ability to support their families.
So many corporations are beginning to say, or have already begun to say, if we think differently about what the workplace means, and we really do think longer-term about how to accommodate our people in a different way, we will be able to see more people and hire the people we need, rather than once again sort of narrowing the scope of people we consider.
- Given your background. I'm just wondering how you're viewing the policy initiatives of the Biden administration. And just for our viewers, you were formerly the administrator of the US Small Business Administration, and also the Secretary of US Department of Housing and Urban Development under the Bush administration. So Biden administration, pros, cons in terms of handling the job market?
STEVE PRESTON: Well, one of the things we're very focused on right now is the infrastructure bill, and any follow-on or related legislation that provides workforce development. The infrastructure bill could provide hundreds of thousands of jobs. And many of those jobs-- actually, the majority of those jobs are good-paying jobs, and they also are jobs that could go to people with high school degrees or even less, because they're very much sort of trade-specific or skill-specific.
So you know, we're very interested to see where that bill goes. We also believe that if that bill advances, there needs to be funding for people to be able to get the skills they need to compete for those jobs. And that will significantly increase opportunities for people that are in lower-skilled jobs today, or historically have been in lower-skilled jobs. So we see a big opportunity, but we want to make sure that the support comes along with it, so that people can avail themselves of that opportunity.
- Steve, two big factors that could potentially impact this recovery. Eviction moratorium expiring, enhanced unemployment benefits also expiring. Is this something that you think will significantly slow the recovery?
STEVE PRESTON: Well, the eviction moratorium is something that we look hard at. Now, yeah, as you mentioned, I was the Housing Secretary. And I was the Housing Secretary during the housing crisis in 2008, and we saw evictions being a very real issue. Housing security is one of the most fundamental needs of people who need stability in their life. If you lose your housing, you lose your ability to find a job, you lose your ability to take care of your family, and any number of issues kind of ensue.
A housing or an eviction moratorium may or may not be the best way to do that, because you also have a lot of small businesses that own rental housing. So there are a lot of different ways that we can support people. So I do believe strongly that we have to make sure that we don't see homelessness spike during this period of time, and that we do so in a way that doesn't put small businesses at risk while they're trying to help, necessarily, the people who could find those challenges.
- You know, you touched on some of the retraining efforts that you're pushing for that are needed to train some of these-- or retrain some of these lower-skilled workers. I imagine at that pay scale, they're not very mobile. But that's just an assumption. I'm wondering what are the dynamics in play there? Are they able to move to other cities, for instance, to find jobs? Or is this just, you're addressing their needs wherever they happen to live?
STEVE PRESTON: Well, you know, the fact of the matter is, jobs are local and people are generally local. You know, some people will move.
But I think what our view is, it's very important when somebody comes through our door for help-- and we help-- over a million people come through our doors for workforce development support of some type each year. We look very hard at the needs of the local job market, and look at how that relates to the preparation level of the individual who is looking for a job. And then we work throughout that process to say, where are you today? What do you need to compete for that job? And let's make sure to support you along that journey so that you can be successful?
It's also important to recognize that it's not just getting through a skills program or taking an online class. Many times, you just mentioned an eviction moratorium. Many times, people need housing stability. Many times, people need childcare or other kinds of support, so they can get through the process to get the skills they need, and to compete for those local jobs. And at Goodwill, our foundational model is to look at the full need of the individual, and work with them to get all of those supports so that they can be successful, land that job, and find their way onto a better future.
- Steve Preston, we always appreciate you giving us the time. It's great to hear from you. Goodwill's president and CEO. Look forward to having you back soon.
