This week in Trumponomics: A welcome pivot to the digital economy

Senior Columnist
Yahoo Finance

Nearly every week, the big news in Trumponomics is some escalation of the Trump trade wars. We’re taking a break from that this week, to highlight a welcome nod from Trump to an important problem: the need to share the spoils of the digital economy more broadly with workers being left behind.

Trump signed an executive order this week establishing the “National Council for the American Worker,” with a mission to fix the skills mismatch that keeps many Americans fenced off from prosperity in a digital economy that increasingly requires technical know-how. I know, I know: who needs another do-nothing commission, with no budget and no real authority. It’s a repeat of “infrastructure week,” a grandiose proclamation soon to be forgotten.

That could all be true: the worker’s council, composed of a handful of senior government officials, will meet only one per quarter, and have minimal policymaking responsibility. There will be a corresponding advisory board consisting of business leaders and other private-sector experts, like the ones that advised President Trump early in his tenure, and President Obama before him, to little effect, if any. Yawn.

Still, it is refreshing to hear Trump, who often seems fixated on the industrial economy of the 1970s, address a modern problem that’s holding back millions of American workers. For that reason, this week’s Trump-o-meter reads MEDIOCRE, our third-highest rating.

Source: Yahoo Finance
Source: Yahoo Finance

We’re not ranking Trump higher this week for a couple of reasons. First, we’re waiting to see execution of the plan, not just the announcement of it. Second, Trump’s disgraceful capitulation to Russian dictator Vladimir Putin now shades everything he does. And in other news from the week, Trump criticized the Federal Reserve for raising interest rates, indicating he might try to manipulate monetary policy, which can only be bad.

[See how we grade the Trump economy so far.]

But back to the worker’s council. Among other things, it will look for ways to publicly highlight the types of jobs most in demand nationwide, along with the training required to get those jobs, as a kind of guide to finding the best opportunities. It will propose government incentives or other aid meant to help workers with outmoded skills get retrained for the modern workforce. One focus will be apprenticeships meant to help young workers not headed to college to learn trades where they can work up to middle-class pay. The council will also promote the importance of STEM education (science, technology, engineering and math) and prod employers to provide better training to displaced workers likely to need it the most.

The skills gap is a pernicious problem not easily solved by government policy. One factor for some backsliding workers is an unwillingness or inability to move from depressed economic areas to more vibrant ones. Some kind of relocation assistance might help, but that type of aid might require Congressional legislation. Some labor-market experts say the biggest need is more funding for community colleges and regional economic development, not centralized guidance from Washington. And some companies are reluctant to spend much money training workers, because of the risk they’ll jump ship and take valuable training elsewhere.

So expectations for Trump’s worker’s council should be modest, at best. Even so, he’s focusing on the right century and proposing mainstream ideas. We’ll take it.

Confidential tip line: rickjnewman@yahoo.comClick here to get Rick’s stories by email

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Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter: @rickjnewman

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