governors, of course, think of governing as a performance art, but we will be thinking of all the other art forms in this discussion rather than that one. our discussion today will be centered on the intersection of arts and commerce. we know that there is such a profound and robust part of economic growth in our states, the economic parts. but i wanted to kick off if i could, i discussion of the art. i remember checking into a hotel in washington a few months ago. and oh's talking to someone who was behind the desk. and he asked, are you related to

frank in sleep? yes, i do, he was my brother. he said, after chelios a story brother.r i was a junior in high school a few years ago and was getting to drop out, things weren't going well in my life. and there wasn't a path for me to be connected to school, it did not seem relevant to my life and what i wanted to do. then he said, governor, your brother frank took me aside and said, i see some talent in you in this particular sketching. i want you to come in, because i want to make sure you stay in school. and the england side, i stayed in school and i graduated, and i am now manager of this hotel. he credited my brother for that, who was an art teacher. that story stuck with me because , i believe arts can. be transformative in people's lives. . aytime we can keep kid in school because of arts, that is a good thing.

so i am a big fan of the arts, not only because of the jobs it creates, but what it means to people's lives in general. how we see arts as part of economic growth as governors. first of all, it is such a large part of our economic development, so understated. if you look at our economies, the artist is the most underestimated part of our economies. we think, when we build a stadium, we think about the economic growth, professional sports. when we think about recruiting a company, we think about the jobs it will create, but we are sitting on billions of dollars of economic productivity in the united states, 5 million jobs associated with the arts, and we into our't pop heads, but it really should. in my state, it is $35 billion. of theart

fastest-growing sectors of my economy, next to energy, about 8% per year. one of the most fascinating things to know about the arts is that it is a big deal when it comes to economic growth. second thing is that, it is increasingly important in the transformative part of our economies. i have a high-tech economy in the state of washington, life science, software, video gaming, aerospace, online retailing. this all demands high tech skills. but what i am hearing more and the real delivery of high technology requires creative skills and communication skills. and there is no better way to do that then build an ecosystem where people have those kinds of skills. that.ovides if you go to a tech companies today, you will find a lot of

may be working in the life sciences industry today, but they were working in the video gaming industry last year, or working on graphical data.aces, how to resent we have a company in our states, a huge software company that is growing like crazy, and they have figured out a visual way to present data. and of course, arts is an intrinsic part of that development of the service. so, this is a huge pot of our economy, a growing part of our economy, because of technology. i am excited about the things you hear from my fellow governors about what they are doing. in my state, we started a program where we certified districts as artistic districts. it has helped local communities serve as an anchor, both for tourism and for economic development, to bring capital to

these particular arts-related businesses. we had 25 committees who are excited about this, it is a small thing, but it has focused our minds on economic development in the arts. i'm excited to hear about my fellow governors, starting with governor d dalgaard of south dakota. >> i do want to add code to his comments that the arts will sometimes play an outsized role than we sometimes think in our economies. i was just sitting here thinking that one of the main reasons why many of the people in this room, or watching over the screens, visit my state, is because they are coming to see a piece of art. maybe coming to seem a rushmore, our largest sculpture. i am also reminded that if we have visitors coming to our home states, the first thing we want to do is showcase our art.

we want to take them to a concert, take them to see something, a museum, showcase our arts, bring people who are dancers, native dancers or singers. we want them introduced to our arts. so it is so important our quality of life, our homes, and also important to the economy of our state. didthing governor inslee not mention, he himself is an artist. in fact, he is an accomplished painter, and he has brought the a staff willh is be unveiling right now. [applause] does that painting have a title, governor? proceeds go to a national

dedication nonprofit. so please, think me in joining -- germany and thanking the --ernor for this beautiful please join me in thanking governor ininslee. my credibility is being diminished governor, but thank you very much. [laughter] today come i have the pleasure of introducing some of our panelists. we are joined by the ceo of the esteemed country music association which was formed in a 1958 as of the first trade group to promote a single genre music. she also serves as president of the country music association which supportsd, music education for deserving children across the united states. also joining us today is dr. edward ayers, professor of the humanities and president emeritus of the university of richmond.

dr. ayres has been named national professor of the year and received the national humanities medal from president obama at the white house. thank you both for being here with us today. now, i would like to introduce new mexico's secretary of interior affairs, she is in for governor susana martinez who is under the weather. thank you for jumping in. veronica will tell us about the vibrant artistic community here in new mexico, and the impact on the local economy. please welcome, veronica. [applause] kirk: thank you, governor. and it is a pleasure to be here. again, my name is veronica gonzales, and i get to talk about one of my subjects, whichn my passion. , for really my whole life. inving governor martinez,

the role as cultural affairs secretary, has been a tremendous honor. it is a pleasure to join you all today, to share with the a little more about our state. i hope you are on all having a wonderful time in santa fe, taking advantage of all it has to offer. few places on earth offers a huge history and cultural diversity found in new mexico. native american culture has been present here for more than 2500 years, and it is home to 22 native american tribes. their rich history is celebrated today as well as in many other cultures in new mexico in our in our dances, our music, or arts and crafts, the very many languages that are spoken here, in our traditional villages. our national historic park dates .d., and it is

considered one of the largest concentration of pueblos in the american northwest. probably the best representation of the first ever created in a new mexico. spanish colonial culture arrived in the state in the late 1500s, contribute over 500 years of hispanic influence to new life.'s way of the annual traditional spanish market display influences food and art in santa fe, which i hope you have had an opportunity to experience. it is something that we are very, very proud of here. we are home to the national institute of flamenco, and many other things like the spanish market, which displays its influence in our state. this strong culture is found in every aspect of the

state, from the food and fiesta, to our architecture and arts. new mexico is known as the state of the arts, because it is home openre working artists, studios, artist-owned galleries and a specialty in artist oriented shops in every other state, per visitors can -- again eating our local food. santa fe international so far is -- lasts of today, weekend. it is the largest folk art --ket in its -- full garg full art market in the world. do experience the summer. this year's market generated $3.2 million in sales and manyors are drawn to the

historical sites, museums, and celebrations every year. -- our new mexico mexico department of cultural affairs is one of the most robust cultural agencies in the nation. we are proud of the long-standing investment that the people of new mexico have in .ur arts and culture industry we have eight museums, eight historic sites covering a range of interests from the early american sites to billy the kid, georgia o'keeffe, paleontology icaleontolog discoveries. the are in new mexico includes performance art.

90,000 people attend the santa fe opera season. the economic impact of our opera generates more than 200 million annually for our region. and employ 700 people. nearly every town has its own .tory and life in the wild west this is especially true of the many ghost towns you may , along with 25 scenic highways, which include over 2000 miles of a diverse landscape. you can visit the ghost ranch and visit the museum dedicated to her life. .ou can follow film trails we are very proud of our film industry, it has been growing in tremendous ways.

our tourism had a groundbreaking numbers over the last seven years. we have seen job growth and tourism up 19% over the last seven years. as cabinet secretary of cultural affairs, i contribute test to arts andthat cultural assets stand above other states. these constitute a deep resource and a point of strength statewide. proud of the amount of artists, art and creators and performers and writers we have here. with the leadership of the , -- it was most comprehensive statewide study

that has ever been done in new mexico, looking at how arts and culture contribute to our state's economy. found, very conservatively, looking at this industry that we are seeing, about a $5.6 billion impact to our state. and support for 80,000 jobs statewide, which includes about one out of 10 jobs in our state. it equals more economic impacts than the construction and manufacturing industry combined. and according to dr. jeffrey mitchell, who conducted the study, arts and culture can no longer be seen as the reward for prosperity, rather arts and culture have become a prerequisite for economic growth and success. in new mexico we have found that partnerships and collaborations are the key to success of a

creative economy. recently we have developed many initiatives as a response to the study that help new mexico diversifies is economy and takes assets,e of cultural that is really the economy is the fastest growing in the world. our tremendous assets included our faces, our landscape, open skies, mountain, desert. historic byways from the camino riel to route 66. our towns, our tribes. --hink as governor connecting these cultural assets to the applied technology field is really where the access of

true economic prosperity can happen. here --re working at working toward that here in new mexico. i'm happy to answer any questions at the end of the presentation. and again, thank you so much. >> thank you, secretary gonzales, and thank you for pitching in for the governor. i know you are talking to governors, but we all of our pickups and we all love our dogs, so we all love country music, so i look for to your comments on how we can advance it. >> i am so delighted. a warm crowd anyway. i am happy to be here at the summer meeting in santa fe. in politics career for c-span. i have attended numerous

converts is over the years. i covered for rounds of gubernatorial campaigns. i say i am much more comfortable in the back of the room behind the camera rather than appear. but i'm here today because i'm so passionate about education and really preaching the chance to talk about why we think sequential music education in schools is so important to the future of our country. many people wonder why cma is here today. the cmarnor mentioned was founded in 1958 in a hotel room in miami. elvis presley was taken over the airwaves, and country music radio stations were changing from country music to rock 'n roll. and executives at the time said if we are going to keep our jobs, we need to put our competitive interests aside and

get together and work for the good of the business. today we work strongly with the industry -- today we work together producing the cma awards, how do we grow country music internationally. and we found one of the biggest fundraising events at the music festival. year -- today we bring 82,000 fans per day to downtown nashville. we raise a two to $3 million minimum each year. the 350 artists that show up, all of whom donate their time for free. the cma foundation works each year to make investments in

music education throughout the country. 2006 thehick that country music association made a decision to start funding music education in public schools on behalf of those artists. investmentnd largest made in nashville, music city, assuming you have a strong music driven out of time. by investing a million dollars in the music program. we learn a lot of our research assessment and accountabilities. what works and doesn't work in a public-private partnership.

we provide music lessons for students and professional developments and music educators. dozens of school districts and collaborations with leaders like you, we have impacted the lives and more than one million students over the last decade. it's really about helping turnaround poor performing schools and long-term workforce developments. access,ve in equity, and sequential programs, whether it is the marriott she program in states, keyboard programs in philadelphia, a recording studio in the boys and girls club in andunity centers in detroit los angeles and chicago.

it bolstered student had -- engagement. recent study shows that children participate in music education are 52% more likely to graduate on time than their non-music peers. 70% more likely to comscore the morning as well as have high grade point averages. on az so test 16% higher -- acton acp math math. now let's listen to some doctors and see how music has impacted their lives. , i'm the deputy chief executive

officer at university medical center. >> professor of pediatric psychology. -- pediatric cardiology. >> i'm a cardiologist. other time i-- the missing her-songwriter and a mom. >> plan a couple of bands that play some sort of modern jazz. a music for me is playing in band three at a >> music has given me an outlet to be completely myself. >> everybody loves music, at least some kind of music. >> there are a lot of musicians that are good musicians. different parts of the right brain thing. you apply them in a unique fashion. , lookople always ask me

at of music are you going to listen to and i say none. i listen to what the heart is doing. >> knowing how to practice will help you do everything in your life. i think that's why being a doctor and musician are related. if you practice you can do anything. you can set your mind to it and work at it. i want to thank my music teacher for caring about me. and in particular i really appreciate the patients that they show. musici could think my teachers now, it would be thanks very much for making me do it. because there were times i didn't want the practice -- didn't want to practice. -- a parentrently they taught me that music apparent theys

taught me that music classes -- for me i wish i had more music in my education. a >> i think music and education is vastly undervalued. music is something that permeates us in a way that is the essence of our humanity. i think the opportunity to be a part of that is a crime. maybe they are going to be a virtuoso. find out it was fun or it was exceptionally talented. as a community come as humanity we know it to our kids to provide that opportunity at an early age. i can't imagine not supporting music education. ♪

>> we recognize it is not about helping teachers and students today, but we think it's about ensuring a stronger and competitive workforce. u.n. your state education team are central to the success and and limitation of education programming. this includes music as a part of a well-rounded education. the governor of tennessee and the tennessee department of education to provide an new administration for our states. takesnitiative in theee's rich history arts, focusing on access to high-quality music and arts education. we are proud to be working with iny of you on initiatives

your states already. while we don't have endless fun, our executive director has endless energy. i hope some of your state staffers are going to take a -- we believe the collective impact of government and private sector are working together, meaning our children can have an outlet were self-expression. to help them with the many challenges in the classroom. one of the things we pride ourselves on beside our great fortry music is a value add connectors and relationship builders in the communication space. for some of our learnings and private partnerships in areas, reach out to tiffany.

on behalf of our country music industry, our artist and --lions of fans every day thank you very much. [applause] >> thank you. i believe you have a photograph of the marriott she banned -- of the wenatchee mariachi band. i was the best music coming out of the nation's capital for some time. thanks for featuring that band. i really like your comments. by the way you just wrote a book, it's called "the thin light of freedom." i wonder if you could tell me about your book and weave it into your comments about the broader theme. >> that's dangerous. i can talk about this book.

it suitable for any giftgiving occasion. world did the united states going to a civil war that no one wanted, but ended up in the greatest accomplishment of our history? that -- that's more of a challenge, i won't repeat all that. he tries to explain the american civil war, that defining event, had done something no one had been able to predict beforehand. it takes us down on the ground. thanks for the opportunity to make that comment. my comments i want to make now with successes. i'm going to strike a different

note and present the national governors association with a challenge at the end. let's begin with a puzzle. historyeve the nation's is the foundation of who we are. everyone appeals to history. is proud of our history and wants our children to know our history. americans seek out history, in best-selling books, television shows, movies, musicals, tourism, genealogy and explorations. american history has been diminished in our schools over the last two decades. disappearing from the elementary curriculum for schools across the united states. folded into the language arts classes but ignored for its rich meaning. children are not thinking

historically about their education. range of the history we teach in space and in time is narrowing. loss to ourofound students, our schools, our communities, our states, and our nation. history teaches fundamental facts of nowhere else. here are the facts i mean. the world has not always been this way. and it will not stay the way it is now. historyf all kinds move in ways that are terrifying and .nspiring there are no more important , no more important our students

to share. how do we weave it into schools? how do we diminish something that everyone values? we lost history when we were looking in other directions. when we focused our energy and resources on other subjects, we considered it more essential. in part because it is all around us. we take history for granted. forgetting how hard it is to teach history well. how essential history is to understand how the nation of the world got to where they are. fortunately, if history teaches us this one lesson, it is that change is constant. talent,urrounded by ideas, goodwill, and momentum in the history education committee. devoted to historians, teachers,

curators, have never stopped working during the years of neglect to keep history alive. to teach history much better than we did in the past, when we too often arrive -- too often relied on textbooks, vacuous vocabulary events, evennitive if students didn't understand more or less where they happened. thetime has come to put same energy and commitment into history education that we put in the science and math and music education. we need to approach our understanding of our social lives with the same urgency that we have devoted to understanding the physical world. good history education bears strong affinities to good science education.

the key to both his discovery, experimentation. there has been a revolution in history over the last 20 years the people have missed. thanks to the national archives, the library of congress, the historic preservation of records commission, the national endowment for humanities. see the richcan record of the people of america in ways that students could never see before. many of your state archives have been doing remarkable work in sharing the resources of your state and local court houses and the record. students can see history firsthand, finding true stories and digitized newspapers from their own community. they can see military records and histories and television footage from the 1950's.

history is becoming discovery. working hard to create new ways to see the past. across america are being used from the sixth grade to graduate school. i'm also involved in a podcast, back story, that registers millions of downloads across the country. that american history understand the american present. that captures and connects representations of the american day,in all media, every showing how inventive our conversations about history are, even when we don't label them necessarily as history.

just as science had been repeatedly revolutionized, now history is finding new ways to see competition patterns of the pasts and individuals that make those patterns. we have the equivalent of telescopes and microscopes to use the past in scale. we can reach millions of students at low costs. let's talk about revenue at american history. that iff of the nations i've thousand museums are devoted to history. museums, debt museums are among the most trusted institutions in our country.

helping to make history tourism one of the most important drivers of every state economy. historyately our museums are not seeing as many students as they should, because students don't have fun or time, given the priorities established .rom high-stakes testing young minds could be touched with imagination and excitement. were are more students than would like to admit that don't have a chance to visit the museums down the street from where they live. they deserve that opportunity from their state. an investment to historical museums aside, with immediate and long-term benefits, strengthening your civic core and educational system. another investment would be good business and leadership.

we seem to have forgotten in the era of standards and testing that teachers are the key to teaching. recruit excellent young people. when they are in the classroom, we need to a free, enable, to connect with each other and the world. teachers of history need to be recognized and rewarded. beyond that, i hope you will look for ways to include your teachers and historians and curators on commission and advisory bodies. you are allyou will confronting problems and opportunities handed to you by your past. you would do well to make historians your allies to help you frame your approach. taught bye classes inspiring teachers in your states.

foster collaboration among teachers at every level. there's something the national governors association can do collectively to advance these larger purposes. you can resolve to make our .ation ready you can encourage the impressive sponsors to support innovative and inclusive approaches to sharing history with its own children. a history in which everyone can see themselves. we should celebrate the anniversary from the ground up from each of your communities and states. together, and about partisan spirit you can use this to bill true unity, a unity born of inclusion.

we can regain what we unintentionally gave away, and engagement with our own past rooted in schools and museums, tapping excited possibilities that did not exist a few years ago. there are historians in every already thinking about this anniversary. our history is the very definition of who we are and who we believe we can become. we teach history to our children and ourselves every day. we can either teach that history based on respect for evidence and expertise. orrick and make up a history that we support at the moment. i vote for schools and museums as the places we entrust our history. teachers, and i vote the past is the on the way to our future.

>> i appreciate your comments about teachers needing a decent wage. >> i look forward to that. >> i would love to throw the table open for questions. if everyone -- if anyone has a question. >> thank you, and i love your art. i want to congratulate that and i hope i have the opportunity to bid on that. it looks beautiful. >> this is half question, half comment. thank you to the panelists. i'll admit i was summary who do not have as full of up -- full of the artsciation and the community.

there is an issue that i want to ask you about, it's an intersection part of my initiative, which is the governor staying ahead of the in the advent of andnomous vehicles technology. i have the opportunity, a good friend of mine gave a commencement speech at the it wasity of nevada, and a speech to the college of liberal arts. what she talked about was putting the human inhumanity -- human in humanity. young people are relying on algorithms and artificial intelligence to make decisions. creativity because of this reliance on technology. believer in steam and

adding the arts to stem. but for employers -- our next panel is going to be on the skills gap area and how we have to -- skills gap. the conversation are those artsal arts major -- majors and historians. can you comment how the arts economy,t in this new this fourth industrial revolution? undergrad.beral arts but i thoroughly believe in everything you just said in terms of being able to -- i'm a believer of students learning the arts. one of the challenges we find working in the classrooms and hearing some of the challenges -- havee a scheduling

with scheduling his parents are sometimes it going to have to -- sometimes going to have to choose between an art class or computer class. in high school often they will make that decision i'm going to go to shop or computer class, because the skills are more transferable. think we are leaving the top down has business leaders. then we can understand ethical uses of ai and businesses that are going to be driving our economy going forward. we are going to get ready to launch a campaign called it starts with me. it really applies to all the top issues, with people holding up pictures of themselves. one of the things we are looking

to do is not feature artists but feature politicians and business leaders and people who got the study courses that made them well-rounded before they went out to the work. >> the digital history projects, we have 18 different majors from the university of richmond helping us make things. national geographic made one of the 15 best maps in the year. are not nearly as distinct as they seem when you look at the list of courses. one of my star undergraduates is in nashville now. one of the most embarrassing moments of my life made me sing a verse with his band. i'm sure that exists somewhere on video.

students are showing us the way, they want to combine these things. >> i want to comment as well. i think it's a very significant challenge. significantly integrating the arts to the other subjects i think and be very effective. especially looking at innovative fields and teaching at a very young age the critical thinking skill that comes through art education. we have a lot of models throughout the united states where the arts are integrated throughout the curriculum and is increased seeing academic achievement. leaders in your own atpective states, looking

our arts curriculum and looking at ways to integrate it whenever possible into other activities at the youngest ages, i think, is really critical. and you no exposure to the arts on a regular basis can really help. with that elephant you were talking about, and making sure children have an appreciation and can learn from the rich arts and culture of our various states. >> we want to thank our panelists, just a closing comment. i know my fellow governors will share observation that the session has reinvigorated our commitment to go back and rethink our education budgets. we know we made a mistake in this regard. squeezing down budget for arts and music and extracurricular work and drama. when we've done that we lost our

educated shares -- our educators an opportunity to reach the kids. let's give them a round of applause. [applause] we are now going to transition to another, what i consider a very exciting discussion. we are going to transition out of a discussion of an intriguing title, which is robots, education, and workforce, transformers and transformation. the only thing left out is artificial intelligence, because we know artificial intelligence is going to be a dominant consideration for us in the next several decades. i look forward to this discussion. all 50 states we share the promise of artificial

intelligence, the promise of a taunus vehicles, the promise of more robots helping us reduce the one thing tasks we have. computers and robots helping to improve surgery and off-site diagnoses. -- we also have a society have anxiety about the rate of transition. we arernors i believe sensitive to the hope of that artificial intelligence and the recognition that as we go through this transition we are going to have to do several things to make sure this transformation supplements and improves our people's lives, as well as the commitment to economic growth associated with it. at the same time, getting our people ready for it in skills toelopment, and cushioning

change. i look for to this discussion about both the anticipated pace of that change, and what we as governors can be most effective at, and that is getting ready. governors are doing great things of innovation to help in this regard. i'm looking forward to hearing about them. one of the things we have emphasized in my state, we think we have made, and we are not the listed in this regard, to some degree, a bit of a stink by sending a message to our kids that if you don't get a four-year degree you are a failure. the message has to greeted our ability to prepare our kids for all of these technical jobs that are going to grow genetically in the future. -- grow dramatically in the future.

it's going very rapidly, we had our first 18 consecutive quarters of growth in a registered apprenticeship program. this isn't just in the trades. that alludes to trade and apprenticeship. we have the first computer programming apprenticeship. i that to go to the second graduation of 60 people. these are transitioning from another career. ofare excited on the side helping families through this transition process. in any disruptive economic andge there is transition things that are upset, patterns that -- patterns of living, careers.

we have one of the best family leave and paid family leave policies in the nation that will help, i believe, as people go back to school three orient their education and give them the opportunity to have a second third and fourth careers. i believe that will be part of the things we need to do to help the industry transition. consulted the boston analysis group -- we are going to have further discussion about that. governor, could you take it away? a personalpart of fulfillment. most people need to provide for themselves and their families. essence workt its is routed to self-fulfillment. job that paysa enough and is enjoyable, that is ideal.

people are struggling to find enjoyable well-paying work. some lack of professional training. sometimes they went straight into the workforce. even those who have degrees, they often have trouble finding meaningful work. who have a four-year degree, 36% say their education prepare them for a job, and more than half of recent graduates are unemployed or underemployed. it's not for lack of jobs. tells us of statistics more recently we have more job openings than jobseekers in america. a number of these jobs are higher paying higher skill jobs in areas like health care, cyber security, manufacturing. unfortunately those looking for

work don't have the skill sets that employers are seeking. the western governors association spent the last year studying the skills gap. we found that integrating state efforts, increasing the availability of training, expanding broadband access and areas and connecting education to careers are ways to help address that workforce gap. we need to ensure that a degree is not just a destination but a pathway to jobs. that means providing students with better information earlier with guidance of a can make -- one way we are doing this is through a pilot program called career launch. includes a number of school districts, which are pooling resources to provide more career counseling and give students a more hands-on experience.

many high school seniors are planning their schedule so their classes are compressed to half the day. and during the other half of the day the students are working at a paid internship with a local employer. each student received high school credit, is paid at least $11 an hour. gains exposure to a career field and learns foundational skills, like showing up on time, how to arrive on time, dress appropriately, interact with customers and peers. it gives them a chance to taste test a career field or two. there is no one single solution or legislative will that is going to be a fix. it takes an integrated approach. first today we are going to have

rich, who is an associate director at boston consulting group. he's going to walk us through data they have compiled in regions across the country. that resources available at your seats, if it isn't already. please welcome rich davie. >> thank you, thank you governor. [applause] will be brief. i i'm the associate director at bethesda, maryland office of consulting. as a former cabinet secretary i appreciate and am delighted to be with you today to talk about this work we did. the bcg has worked on workforce development globally. we partnered with the world economic forum.

some of those are referenced in the material you have in front of you today. thinking aboutme the growing skills gap here in the united states and of those anticipated skills gap. earlier this year we were on it to work to record with governor baker and his team in massachusetts for middle wage jobs. .obs, we all know, are critical we help the governor consider strategies to close that gap over the next several years, and we included in your materials details about that work. as you all work hard to ensure jobs are met -- are available for all americans. i look for to our conversation. >> we are privileged to be joined by dr. alan krueger, he

is the professor of economics and public affairs. he is published widely on the economics of education, unemployment labor demand, econ distribution, social insurance, labor market regulation, even terrorism and environmental economics. that he holds joint appointments in the economics department and the woodrow wilson school at princeton university. ofis the founding director the present university survey research center. he previously served as chairman of president barack obama's council of economic advisers. assistant secretary of economic policy and chief economist at the u.s. department of labor. president of the american economic association just last year. please welcome dr. kruger.

[applause] >> thank you very much. i'm glad you invited me rather than a robot to give my presentation today. whene meeting at a time the unemployed rate is down 4%. economic growth looks like it could be around 4%, yet there are many reasons to be concerned about the state of the job market. low,growth remains too wage growth is barely keeping up with inflation area labor force participation is too low. the u.s. has the second lowest labor force participation rate in the oecd. second only to italy. important, the economy is not generating enough opportunities for middle-class workers and for workers from more disadvantaged backgrounds. these problems have been with us

for a long time. and a strong economy helps. when the economy turned down again, which it truly will -- surely will, -- is difficult to predict the future path of the economy. that theems to me future will not look very inferent from the present that we currently have a dynamic economy, various sectors are perpetually disrupt did and we are faced with having to help workers make a transition to a new economy. think robotics, artificial intelligence, machine learning, many new innovations to come are not going to fundamentally change that picture. i think economists should have a great deal of humility when it

comes to thinking about the future of the economy. 1930reat economist in predicted we will have a future of technological unemployment. then this may be a term you may not have heard of. since then we have created hundreds of millions of jobs worldwide. in the u.s. total employment has grown by more than fivefold since making a prediction. but we need to worry about the quality of jobs. my concern is not about a jobless future, my concern is about the types of jobs created, whether they will pay enough for people to raise families and feel like they're part of the american dream. critical we prepare for our workforce. we also have to prepare our

infrastructure for that transition. social -- need to modernize our social contract for the jobs emerging in the future. we face to problems. one problem is the problem that gets the most attention. and the other is slow productivity growth. what matters for our living standards is how much we can produce with our limited resources. disruption brings productivity growth. in years productivity growth the u.s. and around the world has slowed considerably, which is one of the reasons why we are seeing slower wage growth. a greater concern about productivity growth being too low going forward rather than to rapid displacement. the u.s. economy has always been dynamic.

since 2000, what percent of our jobs are in new occupations? i define occupations as one that that the department -- of the bureau of labor statistics will understand. operators,quipment arose -- aerobics instructors. some of these existed before 2000, but the -- the delisting think them large enough or important enough to include. dls didn't think them large enough or important enough to include. that's actually slower pace of change in the proceeding in 40 years. the u.s. is always going through a dynamic cycle where the nature of jobs is changing. it's also the case that the new jobs tend to pay more. the 44% of the job growth i

mentioned pays wages on average that are 40% higher. there are many forecast about how artificial intelligence and robotics and automation are generally going to affect jobs going forward. the oecd has an estimate that about 25% of jobs that currently exist in the u.s. will be in jeopardy because of automation over the next 20 years. that's not a particularly if you look ater the transitions in the workforce we have had in recent decades or since the agricultural revolution or industrial revolution. the u.s. is on the relatively low end of jobs that are at risk compared to the rest of the world compared to the oecd.

my concern other types of jobs that are at risk. jobs in foodbe preparation or driving. one in every nine jobs involves a significant component of driving. it's obvious how those jobs are at risk. i think there are many benefits to be had by going into a taunus vehicles for safety, for productivity, for expanding access for communities, people who live more remotely. with a taunus vehicles they will be old commute to work for longer distances. that will connect more rural areas. it will help disabled people have more mobility.

the best estimates are this transition will take place gradually enough. that this transition will be manageable. if we compare other major changes in technology like atm's, we still have jobs for bank tellers. is wek what important start to prepare for the transition that's taking place. one aspect of the changing technology that i don't think is widely appreciated is that this new technology is changing the nature of the relationship between workers and employers. ways, this in lots of outsourcing. we see this in the supply chain for labor as well as the outputs for other economy. work is more room nice, more

standardized, everyone is using microsoft office. their outputt around to different employers. another change in the nature of work is more workers are finding jobs over the internet. n digital platform jobs. -- digital platform jobs. there are around one million workers who are currently working on ridesharing platforms . i think we need to update our social contract in a way that makes sense for this new environment. uber and lift can make operations to social security the way others make contributions to social security. we should extend protections in the emerging platform economy, that only the ones that make sense.

i think it's important we rebalance our labor laws so workers get a fair shake in the economy. one of the highlights has to do with no poaching agreements. it's illegal for company's to have an agreement that they won't hire workers away from each other. there's a great area when it comes to franchise chains. a clause that had prohibits its franchisees from mcdonald's the other franchisees. are they separate companies? are they not separate companies? --t week the turned general the attorney general of the state of washington agreed that seven of the largest franchise companies, including mcdonald's, jimmy john's, cinnabon, to drop those restrictions. those restrictions were preventing worker mobility.

i think everyone should agree that competition should be fair in the labor market. i think the future of work is already here. i think we need to have a comprehensive approach to ensure all segments of society benefit from the innovations that are happening right now and going to continue to happen. i applaud your engagement. thank you. [applause] >> thanks, i want to ask a question first, it's interesting listening to you, i've heard from residences and other business leaders, the president of microsoft is giving an address a few month ago and microsoft, of course, is leading the advance of artificial intelligence. the governor's very familiar with that. the president kind of used your language that because of the pace he believes we will be in

normal leslie -- be an honestly beneficial to humans, but he requires what he calls a new social contract. it's interesting here the president of a major tech company saying -- i was in another international conference when he was listening to his fellow texas. -- fellow tech. he talked about the artificial and that talked about the incredible benefits artificial -- talked about the incredible benefits artificial intelligence will bring. he said come all you guys will be in your taunus vehicles that are really nice -- your autonomous vehicles that are really nice. you won't be so happy when there is a mob wanting to set your car on fire because wages and disparity has become so pernicious.

we have great income inequality causing worry in our society. does artificial intelligence make that more of a concern, less of a concern? >> i think it intensifies the concern. the major driver of the rise in inequality is related to the technological change, to computer information technologies. jobs that can be routinized, have in the large extent, been automated. that continues to be a concern. i think the lowest hanging fruit when it comes to approaching it is through education. i think there is widespread consensus we can do more in terms of education. in terms of listening to the last session, i completely agree we can have more music and education in schools -- i would argue history and literacy education. our school year used to be the longest in the world, then we stopped raising the length of

the school year and we are behind over every major economy. one approach is through education. i think that makes a lot of sense because it increases the size of the pie. i think we can get a lot of thought to ways we can give power to workers to have more bargaining power. they have lost a tremendous amount of bargaining power. labor unions represent under my present of the workforce. -- under 9% of the workforce. because of that, we don't have a level playing field. what can we do in terms of public policy to have a more little playing field? -- level playing field? workers tend to get races to a large extent because they seek better opportunities.

it is much more difficult for children of disadvantaged families to get the kind of educational services my children have and other advantage families have. i think that makes it much more difficult problem. i still think it is a solvable problem. >> thank you. earlier he talked about the stagnation and relatively slow productivity growth. thatems counterintuitive as we automate more things that productivity also isn't improving. do you have any ideas about why that is? >> it is a great question. we certainly have the perception that life is changing very rapidly. it was changing rapidly in the 1960's and 1970's also. in terms of productivity gains, there's an argument that some of

the great games are behind us -- gains are behind us in health care, antibiotics -- the governor romney lives have been saved because of antibiotics. lives have how many been saved because of antibiotics. one interpretation is we are just missing a lot of the productivity gains. i don't believe that is the case. a lot of the improvements with cell phones go on measured. i think that was true historically as well. the miss measurement probably has not gotten worse. if you try to trace the slowdown in productivity growth, half of it is due to slower investment. some of that i think will recover some is a result of the financial crisis. companies were not investing in the aftermath of the financial crisis. i think we will get past that

eventually. that is maybe have of the slowdown in -- half of the slowdown in productivity growth. the other half economists can't explain, they call it total productivity. we need to research more in development. -- we need to invest more in research and development. the education sector is always the last to be disrupted. i think there is tremendous potential from a.i., from adaptive learning systems, to complement what is going on in the classroom. not to replace teachers, but support teachers. this is an area where i think the federal government should do much more, because it will benefit all of the states. states should experiment with higher education. one of the things i proposed

when i worked for president obama was we support land-grant colleges. we will give you funds to try different models for education. maybe the students stay at home their freshman year and take core courses online, then come f or three years, or they are going to three or four courses each semester, where they are in contact with faculty. there are different ways to do this. there is tremendous potential to use technology to improve our human capital and address the problems we face in the labor market. thank you for being here. at the beginning of your talk, you talked about workforce participation. nearad a comparison to us italy.

could you comment on some of the challenges and solutions you see? >> there are many crosscurrents in the labor participation rate. what drove participation in the u.s. in the postwar period was more women joining the labor force. more women joining the labor force in world war ii out of necessity, then they continued to join. that boosted our economic growth. that came to an end around 2000. labor force participation of women has edged down since 2000. that is not the case in canada. the u.s. used to have one of the highest labor participation rates in the world for women, and now we are one of the lowest. the issues for women have to do with flexibility at work, raising family and working at the same time -- the u.s. is the

only modern country that does not have paid maternity leave. this is very much in our interest given the demographics and slowing labor force participation. for men, the issues i think are different. a very important issue is the climateinequality and of opportunities for less educated men. labor participation rate for men because of 1950's the decline of opportunities for lower paid men. that is the main reason, although you have some with criminal justice records that make it difficult to get back into the labor force. this problem has also intersected with the opioid crisis. in my work, i found almost half of the prime age men in the labor force take pain medication on any given day.

it is not clear whether they had an injury that caused them to take pain medication, or whether they became depressed out of labor force and took medication -- it makes it harder to get back into the labor force. there are many disparate causes of the decline in labor force participation, and it is in our interest to raise participation because we are going to face a shortage. older workers have lower force participation. that will be a drag on participation for the next two decades. are very much swimming upstream when it comes to labor force participation. >> thank you. we will have to wrap this up. i commend this report to you

governors. it is great, and has some stuff specific to our region. i appreciate what you have had to say today. i know we all share a bipartisan belief that we look forward to the success of artificial intelligence, because we hope it will eliminate natural ignorance, and that will make our jobs so much easier. we are looking forward to that bright day. we know the country looks forward toward innovation and technological change, but we need to work out solutions for our people. panelists our two here. >> ladies and gentlemen, we will take a five-minute break and then begin our five minute session.

>> national governors association meeting is taking a brief break. meanwhile, c-span is celebrating

all things alaska this weekend. scenicait, here are some views from anchorage.

>> are they frequently out here? >> i have seen them here before.

>> ladies and gentlemen, please make your way to you are -- wat to your seats, we are starting. gentlemen, please make your way to your seats, we

are starting momentarily. thank you. >> ladies and gentlemen, if you could please take your seats so we could begin. ladies and gentlemen, welcome to the closing session of the 2018 national governors association summer meeting. i'll tell you, i think i mentioned it before, it has been

a privilege and an honor to lead this organization in the last year. as i look out over my fellow governors, it is a humbling experience to lead this organization. for those of you who have had the opportunity to be former chairs, you can appreciate how i feel right now. when i think back to our last summer meeting in rhode island, i am really proud of how far we have come and what we have accomplished together. obviously i don't lead the nga alone. the organization's entire staff is with me every step of the way. was crucial council not only to my success as chair, but also to our collective success as governors. , i am tryingtive --look if sue is in the room

through this past year, sue and her team have been tireless in their efforts in what they have done for this initiative, to bring our international members together. scott, thank you very much for your leadership, and really taking this organization to the next level. ladies and gentlemen, fellow governors, if you will thank me and joining scott, sue, the nga work.or all their hard >> [applause] myand again, i want to thank colleagues for all of your support during this year. there has been a lot of work, time, andk it all the i have been trying to make a better has the same claim thinking.

you are in inspiration to me. as i listen to what you have accomplished in your respective states for your respective constituencies, it makes me proud to serve as a governor in what i feel is a very special time. again, my thanks to all of you. when we left providence last year, i knew we had the potential to positively impact the lives of americans in every corner of our country. now i am proud to report a year later we did just that. i am grateful to each of you for playing a part in that effort. the national governors association bridges the aisle, and we have heard it over and over again about the importance of a bipartisan organization, and the ability to reach across the aisle. frankly, that is not happening everywhere across the country. political cooperation seems to be getting more rare these days.

we are all governors, but what i like the best of his we are all friends -- best is we are all friends too. these past few days have affirmed governors are willing to roll up their sleeves and work on solutions that have worked in their states. imitation is the greatest form of flattery. i will tell you i have unabashedly brought some of your ideas home, but it has made the lives of nevadans better. i appreciate your leadership. over the past few days, we have eaten together, laughed together, but most importantly learned together. i turn to the bittersweet portion of our program, in recognizing and saying farewell to our colleagues who have concluded their tenure as chief executives of the respective states come january, including

me. we will be bidding farewell to 17 of our fellow governors, including myself and governor martinez. unfortunately, some of them could not be here with us today. i believe we will have something up on the board to recognize them. do we have that ready to go? ♪ gov. sandoval: no, this is the one. >> [laughter] gov. sandoval: we did not quite ruin the complete surprise, right? in any event, there are several governors that aren't here with us today who i would have liked to have recognized, but fortunately there are two of us here with us today.

inpeak for everyone here office and wish the best for them in the months ahead. i mentioned i and in my final year of office, so i wanted to give a special nevada-themed gift to the to governors with us today. in nevada, las vegas, we suffered a tragedy that hit us harder than anything i could recall on october 1. i want to thank all you governors who reached out to me when that happened. we also had at the same time a new national hockey league franchise, the biggest golden knights. has been mentioned before, unix us. -- unites us. it went from being an expansion

franchise to winning the stanley cup finals. first, i'm really proud of the knights and how well they did. i thought i would have something special made for two of my colleagues here today. first i would like to recognize governor mary fallin from the great state of oklahoma. she served as the 27th governor of oklahoma since 2011. the governor and i had the honor and privilege of traveling to the middle east together, and that is something i will always recall finally. the governor jumped to serve as nga chair from 2013 to 2014. her husband chaired the nga leadership spouses committee. this is a great leader in this country who has served her state well, and her constituents are blessed to have had her leadership. mary, i have something for you

if you could join me. please join me in thanking governors fallin and wade for their dedication and leadership. >> [applause] gov. sandoval: for you governor, your own specialized knights jersey with your name. >> [applause] >> thank you. cool. gov. sandoval: and secondly, someone again who i have great appreciation and respect for -- he has served as a great chair of the nga natural resources

.ommittee works, i appreciate your -- you have been a warrior in that regard. we hope for our constituencies and the people of our state is to have a better life. i think you have instructed us on how to make people's lives better. so i have for you as well -- >> [applause] >> i will wear it the next time i play hockey in nevada. >> [laughter] gov. sandoval: you will wear it when we win the stanley cup next year. ladies and gentlemen, please join me in thanking these outgoing governors for their leadership.

>> gov. sandoval: now i recognize governor do guard for the purpose of executive nominations. >> thank you. on behalf of the nominations committee, which includes governors kate round, jay inslee, wc, and gary herbert good -- i am pleased to introduce the slate of committee members for 2018-2019. for the executive committee, we nominate kim reynolds, scott walker, rick snyder, dan malloy, and sandoval.lf, , andice chair, larry hogan for nga chair, steve look -- bullock.

on behalf of the nominations committee, and move to have the slate of nominees adopted. gov. sandoval: thank you, and the members of this year's nomination committee, is there a second? second by governor fallin. is there any debate? there is never any debate. what a great slight. -- slate. the motion is passed unanimously. who isulations to anyone on that slate. i would like to offer my congratulations to the new chair, governor steve bullock, and the other members of the 2018-2019 executive committee. governor bullock, i am really proud of you and confident that as incoming chair, you will carry on the legacy of bipartisan excellence of this

organization. steve, i want to thank you for your support while i have been the chairman. when you get into these positions and you work closely with people, you get to know them. governor bullock is someone i have tremendous respect for, ineone who is a great leader montana and across the country, and someone i have watched and admired for a long time. vicenor hogan as the chair, someone else i have got to know, and the citizens of maryland are blessed to have your leadership as well. before i pass the gavel to governor bullock, again, you work together professionally, you learn from one another, that you also become friends. this video has been shown a few times, it also shows we have a little bit of an together. go ahead and roll that video, please.

[video clip] ♪ >> i am brian sandoval, i want to encourage all of the attendees to take a ride. [indiscernible] jump hubu going from a to another jump hub? does it get you to your meeting? >> [indiscernible] come on. safety first. >> here we go. let's see what we can do.

>> if you shift up to fifth gear, this thing moves. ♪ fun, safe, blast, great way to get around town and i encourage the attendees, but especially the governor's to take a ride. >> they even come with a bell. >> where is the bell? >> it is a handlebar deal. [applause] who says it is not fun to be governor? the only other governor i saw riding a bike was governor bevan, i saw him last night at the park, i am sure he enjoyed that. now is the time to think all of you for your support during my term as chairman of this organization. staff, andink the

thank all of you who come to our meetings and provide monetary support and provide us with information that we can learn. thank our international visitors for elevating our meetings. i think it has taken us to a place we have never been before. privilege,s been a an honor to serve as chairman of this organization. at this time, is my privilege and honor to turn the gavel over to my good friend, steve bullock am a governor of the great state of montana. [applause] gov. sandoval: good luck. gov. bullock: thank you, and

thank you so much governor sandoval for your kind introduction, and also thanks to all of the governors and guests present today. before i announce my initiatives and inaugurate the leadership of the organization, i would be -- if i didwould not underscore governor sandoval's leadership and friendship, and the warmth not only in this past year as i have served as your vice chair, but also the mentorship you have provided me in the last five and a half, six years as i have been governor. it is something i truly treasure, and when you look at the things we will all take away from these jobs long after we are gone, it is those relationships, from my perspective, that are the most important. i think all of us as governors, we are better prepared than we

were a year ago. as governors, we are certainly ahead of the curve as a result of your initiative. nga tradition,he i have a couple of gifts to ease you into retirement from serving as chair of nga. that is yours to keep as well as some of the pictures of your time -- come on up, this could go a while. [laughter] gov. bullock: both the gavel and some of the photos as the governor was serving as nga chair. pleasure tos been a get to serve as his vice chair. i do look forward to continuing that leadership, that bipartisan leadership that governor sandoval was so graceful and thoughtful in doing.

initiativeng is your was all about technology, and i understand you are a reader, a listener of audiobooks, you plan to spend some of your time catching up on some of the things you have missed in the past. we all know you are a technology fan. in that spirit, i'm happy to present you with these wireless youphones which can give the best digital library. i have taken the liberty of choosing three books that are meaningful to me, were going to reach out to the other governors to choose books that are meaningful to them. we have included a gift card for le for the- a kind books. so enjoy that as well. [applause] gov. bullock: i also would

suggest you not spend all of your time hardest to technology. -- time attached to technology. i wanted to give you a gift from montana, this is a painting from the rocky mountain front, remembering there is so much we can get from technology but there are also things we should secure outdoors. , soa handcrafted fly box that when you decide to come fly inh with me in my antenna -- montana, you are on your way. [applause] gov. bullock: i would also like to thank, even the governor martinez is not here right now, to thank her and her staff for the hospitality. it is been a wonderful few days, and i can only imagine wherever it is hosted next summer, how do you keep up?

on a more personal note, i want to thank my wife, lisa, who is here with me today as well as our three children. without their unyielding support, i certainly would not be able to do what i do in montana or anywhere else. thank you, lisa. [applause] i was a little nervous when governor do guard was about to make nominations, you never know what he might have done. but i am profoundly grateful to my coal export allowing me to chair -- grateful to my colleagues to allow me to chair for the next year. i look forward to receiving your candid counsel and continued friendship in the time ahead. i have no doubt that during our time leading nga, governor hogan

and i will surely confront many complex issues. it is no secret that our states and nation faced a litany of opportunities as well as challenges. challenge that all governors are grappling with is the subject of my chairs initiative, good jobs for all americans. as even the panel before underscore, we are on the cusp of profound economic and social transformation, catalyzed by technological advancement, changing demographics, involving skills, and new ways of engaging with work. those trends are poised to reshape our economy at every level. technology like lock chain and chain and ai- block

will transform everything. more and more companies and people are looking at new, nontraditional types of jobs and work. these trends, if we capitalize on them, have the potential to make us all more productive and have greater economic growth. we cannot only improve the bottom lines for businesses against small, but create new waves of upward mobility for every american. just like that, the american revolution really did raise the standard of living across demographics generations ago. i think this new revolution we are facing now could provide americans from all backgrounds, and from every walk of life, new opportunities to succeed and reach new heights. while at these opportunities are within our grasp, they are not guaranteed.

we have seen rising tensions and fears of joblessness or displacement because of these trends. 90% ofack 50 years ago, 30 euros were doing better than ofir parents at age 30 -- 30-year-olds were doing better than the parents at age 30. is not a reality for large swaths of america. leave not afford to anyone behind. we should spread innovation and manage some of its potentially unintended consequences. waves of automation can displace usurpinga serving -- livelihood and posterity. many jobs are risk of computerization. we know changing -- changes

bring concern and widespread in effect. we have to make sure that hard-working men and women are not lost in the shuffle. beyond technology, companies are reshaping the basic structure of work. many employers have moved away from offering traditional, full-time opportunities. businesses have hired more part-time, contract, and gig based jobs. well that provides workers and businesses with needed flexibility, it also threatens the economic security of american workers. as governors, we must forge that path, where companies can manage the workforce to meet their needs while also ensuring that workers have a reliable livelihood. and a fair chance of long-term prosperity. the well-being of

american families, we have to be equipping today's workers with new skills. ensuring ourith schools k-12 and post secondary are ready to prepare students for the jobs of the future, jobs we heard on the previous panel did not exist a decade ago, and the jobs we are facing now have not necessarily been imagined yet. currently the united states trails 17 other developed nations in workplace skills. 1973, workers with some degree of post secondary education only held 28% of the jobs. to be0, it is expected almost two thirds of the jobs. our current and future workers must be prepared to new environments. governors must lead the charge to create stronger bonds and

connections between education, between our bodies, the government, the executive branch, and the private sector. training the future workforce is not the only concern governors must confront. many of our states are facing g andhallenge of re-skillin aging workforce to support modern industry. age is not the only demographic change existing in today's labor force. increasing disparities in education between men and women, as well as oral and -- as rural and urban populations. parts of rural america have been left behind in the economic recovery. it's not because of a lack of hard-working people, as i can personally attest to as a result of my experience in montana. rather, it is a growing at the

structure deficit, access to capital, access to education beyond high school, that can be barriers in rural areas. we need to bridge the growing divides in an sure all americans have equal shot at a better life. the time to answer these challenges is upon us. the chairs initiative, good jobs for all americans, will endeavor to offer a conference of approach for governors to guide their states to that more advanced and productive workforce. failure to act will certainly challenge the future economic potential and power of american industry and labor, but good jobs for all americans represents a collective step in the direction toward an economy defined by upward mobility and economic success. over the next year, we will have three regional workshops. we will focus on three priority areas, creating the workforce of the future, offering workers a

second acts, and invigorating rural communities. i invite all of the governors to send a team from your state to one or more of those workshops. we have a hand out in front of you. we will be in pittsburgh in september, las vegas in december, and des moines in march. i look forward to both elevating what governors are already doing, because there are incredible things happening in the states around our country, but also identifying other innovative solutions to those challenges. creating good jobs are means preparing for the labor market unlike what we have seen before. it will demand sustained investment in apprenticeships and job training programs, forming direct connections between business and skilled laborers. forging pathways requires we do a better job at actually

evaluating the data, addressing job training needs of the private sector. the future prosperity of our state economies relies in large part on the ability to prepare the next generation to meet the economic challenge of a new age. and our folks in future labor by presentplemented workers, scaling of successful programs, developing new ones to rescale workers that are most vulnerable to rapid change. all workers need to have access to the resources they need to succeed in a future economy. it is good for business, good for workers, and ultimately good for the states we lead. finally, we must remember our rural communities who far often -- who far too often have been excluded from economic advances. we know that rural america can face limited access to education, insufficient digital or physical infrastructure, poor

access to health care, and declining labor pools. we have to recognize that if any community is left behind, we all fall behind. working inus on small towns and rural communities to empower them for the future. we strengthen the backbone of america, and i think the whole nation will stand taller. overcoming these challenges requires to work together. every governor, regardless of party, or home state, will face down labor market challenges. equipping workers for the future and 80 current employees, we blueit is not a red or issue, it really is an issue that impacts all of us. our constituents count on us to take the lead in our home states. a certainly welcome all of my peers and colleagues, their expertise and collaboration.

i look forward to that collaboration on the journey that lies ahead. i am certain that when we reconvene next year after digging deep into this in ringing the experts that we will be more prepared to approach and capitalize on future labor trends. again, i so appreciate the opportunity to lead this organization over the next year, and the faith you have trusted in me to do so. the road toward a more productive, prosperous, and empowered american worker must begin with the base understanding of the problems faced also by current employees. arguably, nobody understands those issues better than dr. larry katz. he is the elizabeth allison professor of economics at harvard university. he is an expert in labor market economics, publishing race

between education and technology, which analysis education in economic development. some of his colleagues collect the best of what economics has to offer. dr. katz, thank you for being here, and please come to the stage. please join me. [applause] dr. katz: it is my honor to get to amplify some of the themes that governor bullock was just addressing, as well as my long-term collaborator and co-author, alan krueger, talked about earlier about america's jobs challenges. as was noted, it is not the quantity of jobs today, we have

a reasonably low unemployment rate. we have a fair amount of vacancies, that it is the quality of jobs. and to think about where governor bullock started off, this is the famous graph my colleague and former student and his collaborators put together using newly available big data, the able to track millions of americans -- being able to track millions of americans and looking at them at age 30. the american dream of doing better than your parents was almost guaranteed to people born in the mid-20th century in the united states, during a hearing iod of rapid growth. over 90% of american children earned more than their parents at age 30. today, it is more like a coin flip. if you look at the 1980's, less than half today are earning more than their parents.

a lot of that has to do with changes in the labor market that professor krueger was talking about earlier. atparticular, if you look the earlier cohorts, they were earning twice as much money in real terms as their parents. today, the median wage, the typical worker's wage has stagnated for several decades. attainmentducational was expanding rapidly in previous cohorts. every american birth cohort from the mid-19th century to the late 20th century had two more years of schooling than her parents on average. today is the most educated cohort we have seen, it the rate of change has slowed down and quality ceases to be important. today, they only have several tenths of a year more than their parents. growing -- there is a growing education divide. those with bachelor's degree with strong technical and social

skills have done well, those who have not had the of -- the educational opportunities have been left behind. the third, something we call the fissuring of the labor market. same sort of long-term jobs and investments by a single employer in the workforce have not been as presents. about two thirds of the slowdown in wage growth and growing inequality is what we call the race between education technology, about one third of it appears to be the growing that increasingly u.s. employees are separated where they work. the janitor is not working in same place as the engineers. if you look at a manufacturing plant or university, they are working for an outsourced firm.

same thing for clerical workers, food service. that has been another major component. that has meant a lack of opportunities as well as a change in demographics as was pointed out. of laborown and growth force participation, so the women in the united states, work, and in canada, is 83% in the workforce. noncollege men, declines in opportunities mean climbing labor force participation. when we put this together, what this has meant is we have gone from an era of growing together, if you look at the blue bars, that was for each quintile in the u.s., income growth from 47-73, when the american dream was very present. every group saw rapid growth. two things have happened since there.

all of the bars are lower, the red bars are the last 30, 40 years. productivity growth has slowed down and it is much more unequally distributed so that the lower three quintiles have not done well at all. as i noted, heart is the growing divide by education -- part is the growing divide by education. only those with bachelor's degree or higher have robust wage growth in recent decades. is something that was test on in talking about the art earlier, -- the arts earlier, when you look at the labor market today, consider the technical skills, measured by things like math test scores, that also interactive communication scores -- skills. if you think about what robots can do, new computer technologies, a can take things that are really hard for individuals to do, right in

algorithm, make it repetitive, do it in a similar environment. those were a lot of heart, lucrative, routine type jobs, whether it was clerical, a production type job that existed in the mid-20th century, they can easily substitute for that. what they cannot substitute for now are interactive, and pathetic, dealing with non-structured problems, being able to work in a team to figure out a solution that has not been seen before in a different environment, whether it is working as a care worker, working as an engineer. increasingly, the growth is not just high math, technical skill jobs. if they don't have a strong social skill component, that green line has been declining, it is the interactive work that has been growing, and it is the combination of good interactive liberal arts, creative skills, with some technical knowledge that has become valuable and what we need to think of in our

education system and the ways in which we will move forward. , the otheroted barrier has been changes, as alan krueger did, in the way that workplaces operate, decline of full-time jobs and the growing outsourcing and the need to do with the safety net of people working in the gig economy and also in the outsourced workforce. typically cloud and bargaining is not as strong, and the level of benefits and training are not as available as in the case where an employer will have you for long-term job. to put this all together, we have seen a decline for typical americans in long-term employment and provides good wages, benefits, and protections. we have seen an increase in the workplace, and

things that cannot be replaced by artificial intelligence, and things have shifted in the way that people get jobs, moving online, different ways of screening as artificial intelligence allows to screen out people in different ways. it can be important to vouching for people's skills. and we have seen changes in automation and artificial intelligence. , we i look at these things see a lot of trends that look frustrating and problematic, but there is also a lot of hope out there. i think about something that is several blocks from where i live, in capers, massachusetts -- in massachusetts. for 30 years, there was a large envelope factory there. founded in the 1920's and employed 600 people in the mid-20th century, one of the largest employers in the area. alsode envelopes, but

colored folders used by hospitals, and for medical records. as we went to electronic medical records, and to electronic communication, the demand for those files and envelopes decreased to medically. they were down to 150 employees and in the great recession, they closed this facility. what happened? what is the future? for four years, it was empty, but in 2014, it opened again, completely transformed. it has a climbing wall, a brewery, a whole set of green range ofotics, a wide jobs, artistic ones, and many more are employed there than at the end of the factory. a wide range of skills, a diverse workforce, and it is

clear we can reinvigorate these spaces. space has some office there, by having strong research universities nearby, by having cheaper rent than being in the middle of boston. that is an advantage. empty on saw and solomon -- an empty envelope factory, but there really is a future out there we can provide human capital and skill and reimagine how we use space. to conclude, how do we address these strategies when we don't always have policies that we can clearly know are going to work? what does the state government to? we have tried to develop two different organizations over the last beer years to deal with these issues, one with a colleague, we are losing -- we are using large data on millions of individuals at a detailed level two bring a precision

medicine approach to deal with workforce issues, figuring out what are the demands, what are the areas that have deficits of opportunities, all the way down to the census block level. we should be able to do that in every community in the u.s. to get a sense of what things might work. the second, an organization i helped found known as jay powell north america. we have been trying to test with randomized control trials. the types of policies that might work. what we are seeing is that relative to 20 years ago when i worked in the u.s. department of labor, alan krueger and i wrote a report called what works and what doesn't, and we found a lot more what doesn't in labor market training policies than what works. what we are seeing now is that in apprenticeship like programs, working with industry partnerships, we are seeing -- i have done mine -- nine major

valuations ranging from a work program in northeast ohio, to employment in new york, in boston with health care work, manufacturing work in milwaukee. we are seeing 30% increase in earnings five years out for very disadvantaged and displaced workers. we are seeing similar things, investing in not just high mobility community colleges, throughout the u.s., the associates program is doubling graduation rates and moving getle higher by trying to people better information to find a curriculum and plan that works for them. finally, we have this wonderful 1b programogram -- h where we find talent in india, why shouldn't we find talent in the inner-city of the u.s.? we have been finding through

programs where we discover talent, do some screening, do training,ll abc attitude, behavior, communication, and place people with major companies in positions where we have been generating 40% increase in earnings for individuals, some with criminal records. in conclusion, i think we are on the cusp, there are major changes in the economy, bringing large data and testing of policies to bear, we might be able to make some progress in creating the foundations for economic growth and shared prosperity for a wider range of workers. [applause] gov. bullock: thank you so much. thenl ask a few questions, open it up to all of you if you have some.

it was interesting to hear use you speaking- here about where the opportunities are and using data. no matter which one of the states we lead, we have rural areas that can be substantially different than the economic opportunities in urban areas. how should governors, what steps should we take to ensure rural populations, which really is the backbone of america, are included in the benefit for future economic advancement? thing,z: the first historically the way we have done a lot of this, obviously this nation was very rural for a long time. over 50% of workers were in agriculture. that was 120 years ago. to a large extent, this is the story we told in the race between education and technology. we were leaders in investing in

the education of young people in rural areas and agricultural areas and small cities. 100 years ago in places like , montana,ebraska leaders in education more than the u.s. cities. kids educated in rural areas would outcompete kids in cities. advance inart, as we ever cultural productivity and areas, we will be moving out of some areas in terms of population. educating young people and being leaders in the same way the high school movement did, we need to do this with post secondary education. that is the first part. the second is clearly infrastructure and connection to the economy through transportation, broadband. the third is to think about what will be the valuable uses. many rural areas in the u.s., it is a combination of artistic

work and the tourism of the outdoors that will be a comparative advantage and job producers. finally, extremely important, these will be aging places as in general. the structure of care work will be essential. are these going to be nine dollars per hour jobs, or will they go to the middle class? this will be the future of the middle class in many rural areas, it will be defined on health and care occupations. it will be increasingly important. trying to upgrade the certification of people who work in there, trying to attract whate, it will be key to living standards and progress will be in rural america. gov. bullock: i think it governors all across the country have been talking about, but it a four-yearsarily degree, but professional certification and

apprenticeships. governor daugaard did a lot of work with pretty ships. -- with apprenticeships. seen, how we can provide skills that not only provide a better salary in life, but also with the skills workers need. but what about in some profound economic change, there are midcareer workers displacements? how can governors work to provide a better second act, if you will, for these workers? dr. katz: there are a couple of things. have anright now, we unemployment insurance system that provides assistance while you're out of work. potentially thinking about, something i have worked on, something more like wage loss insurance as part of unemployment insurance to help people in an interim period, to

move to something lower wage what they are getting education, to fill the gap in their own words -- gap from their old earnings. to change the social safety net. secondly, we have heard examples of apprenticeship type programs for midcareer workers, whether it is moving into computing, health care. we know we have growing possibilities. we know that well functioning community college programs along the lines that i was talking about, these training programs linked to industry demand, that have rigorous training, can provide substantial earnings returns. we will need to think about the investing like that moving forward. i think in the short-term, one thing we can do is try to think

creatively about the way we use unemployment insurance to help buffer these shocks as people move into new job since learning opportunities. gov. bullock: do any of my colleagues have questions? governor bevan. >> i noticed on the last slide, you talked about the collaboration between academia and a local and state governments. certainly this is topical. every governor wrestles with peoplelty in retraining for a modern workforce, who have maybe pursued a different path until this point. i wonder if in your work, you find it to be an equal challenge or even a greater challenge to reinvent the way public, post secondary education approaches this? if there is anything that seems to become stale and disconnected from what the end-user truly needs, it would seem in many respects to be some of our post secondary institutions.

i am curious as to what your experience has been with that, do you think they are keeping pace with what the local and state governments are doing as necessity? dr. katz: historically, there are two components that public universities have played a role in. one is clearly the broad education for a wide range. the other has been, where i still think they are very valuable, on the research and innovation side, where the spillover from research universities -- if you look at where are using the most resilience in response to technological changes, it is a most always in cities and areas that have a research university doing practical and innovative research that in a fit the local area -- that benefits the local area. on some level, that will also benefit surrounding rural areas. one part is the ability to come up with new discoveries and

commercialize it, which is often a hub near the university, the other, it is important at the community college level as well as four-year colleges, to try and combine -- liberal arts education still is a valuable, it is part of the social skills, but it is only really valuable when it is combined with something real in the workforce. combining the college with something that looks like internships, work opportunities, seem to be very valuable. we have been doing a lot of that, at the high school level and at community colleges and trying to develop those partnerships. i know kentucky has been a leader through a series of technical sort of colleges and moving in that direction, but i think there is an ability, and in some sense historically that is what a lot of state universities were set up to do. we need to return to that.

i think there is a lot of upside potential there. one thing we are doing through an initiative is we have been looking at every university in the country, linking administrative data, who was doing a good job at helping people from his advantage and middle-class backgrounds move into upward mobility? there is a lot of variation and hopefully that will generate some lessons that we can look at what are the characteristics of, say, a place like florida international university seems like a very high upward mobility potential. stony brook. certain community colleges in california. the big data approach may allow us to get some sense of what is the difference now that we have more systematic data, and what more successful ones are doing that could become a learning platform for other states. gov. bullock: other questions? >> thank you for being here with

us. you mentioned research you have done with dr. kruger about things that don't work, sort of building on the opposite of the last question. address people doing to the chronic low unemployment we will face in the future? what do you think people should stay away from? dr. katz: i think that, you know, traditional job-training programs that did not have a -- we linkage to industry found in the 1980's and early 1990's, a lot of traditional job training programs had very little return, particularly for adult workers. i think looking more at the state-of-the-art one where you bring a community college, a local nonprofit, and you combine it with an industry where the ideal is where they have jobs

today but they think will be a pathway to what has been successful. things that look more like wage subsidies to employers are not doing strong training, using temporary help agencies to place people in jobs, a have not been very successful. similarly, as of a few years ago, 25% of all pell grant money and student loans were going to war profit higher education -- going to for profit higher education institutions. many had very strong incentives to turn people -- to move people through very quickly. trying to invest more in improving things like community colleges and state universities, it has seemed more successful than proprietary outside programs. i think those are some of the things.

again, transitional job, some rolesoyment have limited -- these are things we can improve. we know that a lot of summer jobs in rural areas, kids do good things in them, but they don't seem to translate to longer-term outcomes. it appears the ability of things like using that as a platform to of a letter of recommendation or certification of skills, can greatly improve things. prisoners transitioning into the workforce. a short-term job by itself doesn't do a lot, but combining that potentially with drug rehabilitation, things that look more like soft skills, therapy. it appears we can transform some of our existing programs in ways to be much more effective, is the way i would think about it. gov. bullock: you have done a lot of work in this area.

we are undertaking a lot in this ,ext year with this initiative both making sure we have the pipeline of talent of trained workers, the rural side of it, giving workers the second act. let's say that tomorrow, somehow you woke up and you were no longer be professor of economics and -- you were no longer the professor of economics and somehow you were the governor. individually for the state and collectively amongst governors, what are the first couple of things you would suggest that we do? dr. katz: i would be very humble in saying there are a wide range of things i would not be ready so i would want to learn from the collective wisdom of those who have operated here through the nga and have knowledge. but i do think some of the things -- in the end, trying to

ona little more systematic learning about what, in my workforce policies, what was effective and not effective. i would want to take advantage of the new data that is becoming available. i would want to do some experimenting, trying in some parts of the state some things, and learn what was more effective and be willing to cut things that are not as effective and reallocate money. i think it is pretty clear that thesecapital, linked to social skills will be valuable, so i would want to rethink curriculum, do some of the things that alan krueger had thought about, experimenting, making higher education more noble -- more nimble. i would also think about trying

to make a place as attractive for researchers and r&d to be a hub of new invasion. strong research universities, things that look like manufacturing extensions appear to be more effective for long-lasting ones than just financial incentives for companies. that would be one of the things i would really want to work as a group of governors to push more ,han a race to the bottom financial incentives to get the same employer into an area. i would certainly start out very humble and wanting to learn of thehe experiences members of this organization. gov. bullock: i so appreciate professor, both your thought-provoking response and direct thought of tangible things we can and should be doing. i think we collectively understand the job we need to do

now, it is up to us to undertake it and get it done. i look forward to working with all of my colleagues as we go down this path together. thank you for being here. thank you for participating. please give dr. katz a long round of applause. [applause] gov. bullock: and this concludes the 2018 summer meeting. hopefully we will see you all at the reception this evening. the meeting as of now is adjourned. thank you so much. [applause] [inaudible]

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[inaudible] [inaudible] >> you'll be able to watch some of the national governor association summer meeting panels tonight at 8:00 p.m. eastern on c-span.

a representative from michigan delivers the democratic weekly address. he talks about the flint water crisis, and rebuilding america's infrastructure. the white house did not release a presidential weekly address. representm proud to michigan's fifth district. most of you know the story of flints water crisis. state officials obsessed with austerity switched the city's water to be flint river -- to the flint river to save money. they also failed to treat the water properly, leading to corrosive water leaching lead into the homes of thousands of restaurant -- thousands of residents. state officials dismissed city officials, telling them to relax. flint is my hometown. i grew up and raised my kids in flint. it breaks my heart to see what happened in