While attending business school, I supported myself by working at Hill and Vaughn, a classic-car restoration shop established by America’s inaugural Formula One champion, Phil Hill, and collector Ken Vaughn.
My primary responsibilities there included working on interiors, involving materials like frog skin, buffalo hide, and various others. Additionally, I functioned as a mechanic, rebuilding engines and fixing numerous components and systems essential for cars since the time of Henry Ford. Similar to many in America, I gained knowledge through practical, hands-on experience.
In my current role as a CEO, I frequently encounter discussions about how emerging technologies, such as AI, are poised to revolutionize our economy. However, I consistently reflect on the tasks that AI cannot supersede: those performed by millions who primarily use their hands. This encompasses tens of thousands of Ford’s hourly staff and skilled craftspeople who ensure our manufacturing operations function daily, as well as millions who depend on our commercial trucks and vans for their livelihoods.
From a first responder administering an IV in a moving ambulance to a plumber clearing a clogged drain, AI is incapable of performing these roles.
These individuals performing manual labor belong to what we term America’s “Essential Economy.” These are the vital industries crucial for sustaining our economic activity—sectors where jobs have historically served as pathways to the middle class and bedrock for robust, stable communities. Industries such as construction, agriculture, skilled trades, transportation, energy, and manufacturing sustain and deliver in GDP. The Essential Economy forms the fundamental structure of this nation, and it faces threats.
In the last eight years—owing to advancements such as cloud computing, mobile applications, and enhanced teleconferencing—productivity in the . However, productivity within the Essential Economy saw a decline during this identical timeframe, by the Aspen Institute. This trend worries me as Labor Day approaches, given that productivity is among the most potent instruments for fostering increased business profits, elevated worker wages, and a stronger national GDP.
Strategies for bridging the productivity disparity in the Essential Economy
Therefore, what methods can we employ to bridge this divide?
Initially, we must earnestly address workforce development. The United States is experiencing significant labor shortages across vital industries. Within my sector, we anticipate requiring over over the subsequent three years merely to meet demand. The construction industry is , and . My forecast indicates that the need for well-trained, skilled Essential Economy workers will intensify in the coming years.
For an extended period, workforce development initiatives have been perceived as a form of assistance for those recently unemployed. Conversely, as a argues, we ought to draw inspiration from the effective model of federal R&D financing—and view workforce development as a potent investment in the Essential Economy. Currently, our expenditure on vocational training falls behind almost all other industrialized countries—amounting to only 0.1% of our GDP, based on recent studies. This situation demands alteration.
Approximately a century ago, laborers had opportunities for training at private establishments such as the Henry Ford Trade School or via governmental initiatives like the Works Progress Administration. Both of these ceased operations by 1952.
Public colleges providing two-year degrees and certifications in skilled trades have historically been, and continue to be, a stepping stone towards a secure middle-class existence. A cultural transformation is needed regarding workforce development in America to dismantle the misconception that these professions are not valuable for our youth to pursue.
The labor market outlook for 2050
Our approach to training workers should equip them for the economy of 2050, rather than that of 1950. Innovative tools such as augmented reality and robotics possess the capacity to enhance an automotive technician’s productivity, similar to how cloud computing benefited an office employee. Presently, there is a chance to ignite a “digital” transformation for the primary tools used by individuals in hands-on professions.
To realize these objectives, it is imperative to reduce bureaucratic hurdles across federal, state, and local administrations. , infrastructure and manufacturing-development projects are halted due to avoidable and expensive delays in permitting. We are capable of identifying methods to guarantee safety, safeguard the environment, and incorporate stakeholder feedback, all while accelerating project completion.
I am aware that numerous other valuable ideas exist. Later this month, Ford will host a on the Essential Economy in Detroit. I have extended invitations to prominent figures in business, technology, and government—along with, naturally, workers and entrepreneurs who are at the forefront of the Essential Economy. I am optimistic about our potential impact, as concepts originating in Detroit seldom remain confined to the city.
What repercussions will follow if we persist in overlooking the Essential Economy? Insufficient numbers of construction workers will lead to even higher housing costs. A scarcity of agricultural laborers? This will translate to increased grocery prices for everyone.
Therefore, as Labor Day draws near, I will commemorate Ford’s frontline personnel and skilled tradespeople for their daily efforts in facilitating the movement of millions. Furthermore, I will seek solutions to narrow the productivity disparity impacting all Essential Economy workers who construct and maintain this nation and its communities. It is time to elevate the Essential Economy to a national priority—as its prosperity is in the collective interest of us all.