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Podcast

Podcast

Harvard Business School Professors Bill Kerr and Joe Fuller talk to leaders grappling with the forces reshaping the nature of work.
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  • 23 Nov 2022
  • Managing the Future of Work

The American Opportunity Index: Rating Employers on Upward Mobility

High on the list of what makes a good job is the opportunity to advance. How well do Fortune 250 firms deliver on this, particularly for non-college graduates? Co-creators of the American Opportunity Index, HBS Managing the Future of Work co-chair Joe Fuller and Burning Glass Institute president, Matt Sigelman, discuss the new employer scorecard.

Bill Kerr: Opportunity is hard to gauge. One common measure, intergenerational economic mobility, which has been in decline in the U.S., gives a sense over time. But it’s difficult to get a reliable picture of how an individual’s job options translate into chances for advancement. A new employer scorecard, the American Opportunity Index, aims to assess how well the Fortune 250 firms foster economic mobility. The index is based on an analysis of the employees’ career histories, job postings, and salaries. It focuses on jobs that are available to non-college graduates, a group that makes up about two-thirds of the U.S. workforce. The idea is to inform workers’ job and career decisions, while highlighting what practices lead to greater opportunity and furnishing employers with data to make their workforces more competitive. What do the rankings reveal? And can the index prompt a rethink of the HR practices that hold back employees and businesses?

Welcome to the Managing the Future of Work podcast from Harvard Business School. I’m your host, Bill Kerr. I’m joined by the index’s main authors, Matt Sigelman, President of the Burning Glass Institute, and Joe Fuller, my Managing the Future of Work Project co-chair and podcast co-host. We’ll talk about why we need better opportunity metrics, how the index can move the needle on upward mobility, and which companies are succeeding by its measures. We’ll also talk about the index’s reception since its release in October 2022 and what comes next. Welcome to the podcast, Matt and Joe.

Matt Sigelman: It’s great to be together.

Kerr: Thank you. Maybe we could start a little bit with the origin or the genesis of the American Opportunity Index and who you have as the intended audience: employers, workers, policymakers, investors. Who do you want to read the report and use the data?

Joe Fuller: The origins, really, I believe are a result of some of the work we’ve been doing, often in conjunction with Burning Glass Institute, on upward mobility for workers. We know that there are a large percentage of workers who are in jobs that pay less than 200 percent of the poverty line. In previous work, called Building from the Bottom Up , we looked at what distinguished the career paths of workers who had managed to transcend that barrier, to punch their way out, if you will, of being stuck in a low-wage high-turnover type of position. But throughout that work, what we saw is that the specific policies of companies that they pursued to help workers gain momentum in their careers, qualify for better-paying jobs, and the execution of those policies were hugely determinative of the outcomes. So we wanted to try to flip the script and look at working environments rather than the experience of workers, which gradually came together as the American Opportunity Index.

Kerr: And Matt, maybe I can ask you to think about it from the Burning Glass Institute’s research program, how does this index sit in that?

Sigelman: Our work grows out of analysis of both the job market and of changes in skills. And so the ability to look at skills as a mechanism for economic mobility is a key research priority for us. As Joe mentioned, in past research, we’ve seen significant differences in terms of people’s mobility based on where they work—or put simply, you can have two workers in the exact same role at directly competing companies who have very different prospects of moving up. And so we wanted to be able to look at not just the individual determinants of mobility—in other words, did you go to college? What kind of work experiences do you have? Do you have grit? Do you have persistence?—but also the institutional and organizational determinants of mobility, which turn out to be quite important.

Kerr: Matt, what workers are captured in this?

Sigelman: So this is looking at the career histories of 3 million people who were employed in the Fortune 250 in 2017, and tracks them over five years. It’s looking at people who are working in jobs that are open to those without a college degree. We define that as jobs where at least 30 percent of people working in those jobs don’t have a degree. We feel those are the people whose careers are most on the bubble, where they don’t have a piece of parchment to fall back on in guaranteeing their mobility. And importantly, this was looking at people’s career histories as observed through online profiles, resumes, and the like.

Kerr: What is the motivation for shifting it into some measured realized outcome versus the intentions? Because some things could affect employee and worker mobility that are beyond the control of one of the companies that you’re looking at.

Fuller: Well, sure. And I think one of the questions we’re trying to provoke is for companies to ask themselves where does that line fall? To what extent are these outcomes a function of either steps we have taken that constrain the ability of people to grow, the ability of people even to apply and be considered as legitimate candidates for the company? And also, are we actually following through on our policy prescriptions? One thing we’ve seen in previous research is that senior management in a lot of companies is quite convinced that they’ve got all the policies in place to enable upward mobility for workers and to broaden the aperture on their hiring, when in fact, when you talk to executives, managers, and frontline supervisors lower down in the company, they’re not nearly so confident as senior management is. So we’re really trying to provoke, Bill, employers just ask themselves more detailed, more specific questions. If, as they make those inquiries, they find they’re really not executing policies or they really don’t have a determined effort to help their incumbent workers grow in a way that advances the individual’s interests and the company’s interests, then they may want to consider making changes.

Sigelman: I would say, fundamentally, even before you can start to think about execution of policies, you also figure out which policies matter. And I think that’s been absent from a lot of the research. What we’ve done here is created a yardstick. And you were talking, Bill, before about loss of intergenerational mobility. This is effectively a yardstick for the American Dream.

Kerr: Along those lines, tell me some of the big headline findings. And was there anything coming out that you were very surprised to find?

Fuller: A surprise for me was the magnitude of the differences that different companies provided for workers. So we looked at the Fortune 250 by quintile, and five years into one’s career, if you were working in a top-quintile company, you were making two and a half times what a worker that entered in the same role, controlling for occupation, in a bottom-quintile firm made. You were more likely to get a promotion a year faster. I think a second thing that was quite interesting is, very few companies, even at the highest-performing companies in the index, are rarely checking every box. So there’s a lot of room for improvement across the data set.

Sigelman: So we tracked opportunity creation in a number of different ways, one of which was access to opportunity, to what extent are people able to get on the ladder. We tracked mobility. So once you’re on the ladder, can you climb up it? And we tracked, as well, wages. Are you making enough to be able to stay on the ladder? And to Joe’s point, across each of those areas, there were significant differences between the top and the bottom. For example, companies that are in the top quintile in various access metrics are four times as likely to hire somebody without substantial work experience and take that chance on somebody who’s trying to get into the workforce. They’re 25 percent more likely in any given role to hire somebody without a degree. Those are very significant. And think about that, by the way, from an impact to a firm’s perspective. We’re in a market right now where there’s tremendous talent shortages that are found everywhere. And to say, “Hey look, we’re going to widen the aperture of hiring to that extent,” is very considerable. Similarly, by the way, one of the other things we tracked is retention, because if you’re churning and burning through workers really fast, inherently they can’t be moving up. We know that some occupations are higher turnover than others. But top-quintile companies were holding onto their workers twice as long as bottom-quintile companies. Again, in a market where everyone’s struggling to find talent, those kinds of differences are real.

Fuller: And those findings, Bill, come with a considerable sense of relief, because it’s highly consistent with earlier research we did that said that lower-wage workers valued where they worked, wanted to stay where they worked, if there were opportunities for them to earn more and progress in the company. So a little bit of a sigh of relief when this data confirmed our earlier research.

Kerr: Yeah, I’m glad you didn’t disprove the previous five or seven years here. I want to go into the weeds here for a little bit and actually talk about the data and the development of the index. And then a little bit later, we’ll come back out to how it can be used. And I think many of our listeners would know this, but let’s begin with the Fortune 250 are the 250 largest companies in the U.S. by revenue. Matt, maybe I can go to you. Tell us a little bit about the data that you’re bringing into this measurement inside these organizations of the opportunities that workers have.

Sigelman: So one of the things that allowed us to create an outcomes metric is the ability to track people at scale through their careers. And that’s not previously been possible. What we did here is we tracked the careers of 3 million people who were working in the Fortune 250 in 2017, and we tracked them over the course of five years to see what happened to them, both within the firm and outside the firm. So that takes some very different kinds of data sets. We’re lucky to have the generosity of both Lightcast, which provided us data on millions of people’s career histories, and Glassdoor, which provided us with compensation data on millions of workers as well. And so that gave us a way of measuring real worker experience in ways that, normally in the past if you wanted to do that, you’d have to run a survey and ask people what they experienced. And inherently, you’re going to be looking at many fewer people and be much more constrained. Here we could actually see the career steps that people were taking, dimensionalize them in terms of the occupations they were in, the pay they were likely earning in those occupations, whether those transitions happened within companies, between companies. So it really gave us a very granular look at how American workers are faring.

Kerr: And this is part of a big revolution, I think, in economics and business research that is using the data that’s collected by vendors and outside organizations and Burning Glass Institute and so forth, to really provide a supplement, complement to official government statistics and be able to shed light on questions that are otherwise really challenging in there. You’ve mentioned the hiring funnel, what types of qualifications the employers looking for, retention, salary, and a few others. Was there anything that you wanted to measure and you just couldn’t, like that was a little bit beyond the scope of current data?

Sigelman: Well, I think there’s a couple things that we’re working on right now to add in to our next go at this, which we plan to make this an annual thing. One of them is to look at disparities by race, ethnicity, and gender. And I think we are still evolving that methodology but believe that we’ll be able to bring some insight to those sets of questions. We want to make sure that, not just broadly are people moving up, but is everyone moving up. I think questions of pay progression, how are people’s pay moving within a role over time, I think, are also really important and things that we weren’t able to measure here.

Kerr: Great. And Joe, continuing on that, how do you think about maintaining and disseminating this index that you’ve developed?

Fuller: Well, we were very fortunate that the Wall Street Journal took interest in this and, of course, published a large article on it with links to the Index. And the data is all available on a website, a very well constructed website—I say that as someone who had nothing to do with the design—at www.americanopportunityindex.com. So that made it accessible to both companies. And we know the companies have been looking at it from some of our inbound messages from companies, but also allowed people to look by sector, by company. And that combination of pushing the data out there, we hope, will not only cause companies to take notice—because we all know managers and companies are competitive, and they suddenly see that they’re seventh in the insurance industry or not in the top 50 of a certain archetype of employer. That gets their competitive juices flowing, and they want to understand why they didn’t do better. The other thing we’re hoping, of course, is that over time, particularly as we refine the analysis, this will become of interest to workers themselves or people advising workers—whether they’re educators or social entrepreneurs who are training people to upskill them—so that they can see what are the companies that seem to offer the best prospect for workers who don’t have a college degree. I think what is profound about the spread of impact for workers is, if you were offered a job in the same position at the same wages in a company that, in the index, is in the top quintile or the second quintile versus one in the bottom two quintiles, there would be the likelihood of very material differences and outcomes for you. So making it as accessible as possible to multiple audiences in user-friendly forms has been our objective.

Sigelman: And I think this is a moment that’s ripe in no small part because of the kind of talent shortages that we’ve been experiencing, because of the growing recognition that companies have of the imperative of broadening the equity in the workplace. And both of those create a golden moment that’s bringing new focus to, I think, a more analytical mindset, understanding employee advancement, worker well-being. I think, look, a growing number of companies—and I think investors as well, by the way—are taking a wider view of social responsibility, just the Business Roundtable stakeholder capitalism framework, obviously a growing set of ESG commitments. So I think companies understand that workers are a key stakeholder group, but I think worker mobility, itself, hasn’t been on their radar. They haven’t had a set of metrics for it. And I think this is an opportunity to not only make sure that that issue is on the table, but that companies have a means of developing workflow around it—developing process for ensuring that this isn’t just something they look up and see a headline, but this stays present in the kind of things that they measure.

Kerr: Matt and Joe, I’m channeling my inner listener here. Their boss has ordered them to go back to the office. So now they’re in some commute, and they’re listening to this on the commute. And they’re ever gripping the steering wheel harder, and they’re saying, “Just tell me who’s number one.” They want to hear some actual company names, also some sectors. Are there some sectors that perform better or worse in this metric?

Sigelman: So I think, hats off to a number of the companies that ranked—to AT&T to Amex, but also to companies like PG&E to Microsoft and Liberty Mutual, and others. I think, to me, one of the things that really stood out is how broad and varied that list is. I look at a list like that and say, “Okay, look, we’ve got telecoms, we’ve got a financial services company, we’ve got retailers who are in the top 50.” And retailers historically haven’t necessarily been known as companies that are providing great opportunities for workers. Really, one of the things in general that we saw is, obviously, look, there are sectoral footprints of mobility. But sector didn’t prove to be destiny. If you look at the insurance industry, that was a great example of this. There were four insurance companies that ranked in the top 50, and there were five that came out in the bottom quintile. So across every sector, there was quite a wide spread—in terms of who is performing well and who still has room to grow—in terms of delivering to their workers.

Fuller: One of the challenging things, Bill, in the analysis is, as Matt said, there are sectoral differences, and it’s not fair to compare a Dollar General—which is a member of the Fortune 250—and the career opportunities that they create broadly with a Pfizer or a Merck in the pharmaceuticals business. So in addition to ranking companies overall, we isolated five different archetypes of environments for companies in which different types of companies—with different strategies, different ratios of frontline workers to supervisors, different geographic spreads—could be evaluated against each other. And those range from archetypes like:; What are the companies that provide really great stability for workers in these jobs versus which are companies that may have fairly high turnover, but as a first job experience, the company is a great launchpad—people that leave the company often are getting better jobs at a higher level of pay with more responsibility where they end up. Or companies that are great at just growing the internal talent and a couple of other models, too. We looked at each of those, and then our composite, our overall top ranking, looked at how companies performed across each of those different mechanisms for supporting advancement. As I said earlier, one thing that does stand out is, most companies are trying to do some things. And if you look at the statistics, even broken down by these archetypes, there’s a lot of clustering around the middle. So it really is a bell curve distribution. So that really does suggest that additional incremental changes of a couple of policy steps might really enhance the performance of companies on average. And we just like to keep that mean performance marching to the right, getting better over time. And we’re hoping this, as I said earlier, provokes companies to ask, why were we in the bottom quintile relative to other insurers or other defense contractors or other retailers? And what are they doing that we might emulate?

Kerr: Having looked at the report, I do think we’re underselling one of the findings—and then also the quality of the report. The finding is this sectoral difference, which it’s remarkable the spread that was within sectors. And for looking at the individuals with less than college education, yes, perhaps all things equal Microsoft might be a little bit more advantageous than Dollar General to start with, but within the retail sector, you had some that were ranked very high and also some that were ranked very low in those other places. And that was something that stood out to me. And then in the report, itself, you do have a lot of lists. And you can find where companies are and help understand some of their outcomes. Let’s continue with the use of this index. Let’s begin with the employers—the businesses—and whether they are among the 250 they got profiled or not, what would you hope they do with this information that’s being provided to them?

Fuller: Well, I think there are several things they can do. We identified nine different variables, such as the velocity of growth a worker experiences in the organization or the openness company is to entry level hires in terms of not imposing very onerous conditions by which applicants are assessed, such as requiring a college degree or requiring multiple years of experience. And in each one of those, we hope that companies will go ahead and look at their profile and contrast their profile with peer companies that they choose to look to—as companies they either respect or they think are pretty close competitive matches, maybe the same companies, for example, that their compensation committees on their boards use for evaluation of executive comp. If there are peers for our compensation, shouldn’t they be our peers for the way we pay and promote and advance workers without college degrees? And just march around the display on the website and circular, march around the circle and say, “How do we stack up to those peer companies? And why do we do it this way? And do we have a strong business logic for it?” What I do want to emphasize though is, a company may do that and say, “We’re satisfied that what we’re doing makes sense for us.” This is not a “if you’re not doing this, you are wrong or bad or an abusive employer.” We think the data does speak for itself and that a lot of companies will reflect on those questions and say, “Yeah, we could make changes here.” And we’re equally anxious that boards of directors get involved in this. We think it’s both a good manifestation of their responsibilities to the shareholders, but also things like the Securities and Exchange Commission and asset managers like BlackRock are expressing increasing levels of interest in so-called ESG reporting. And that’s going to manifest itself in eventual reporting requests from asset managers like BlackRock or requirements eventually from the SEC that you’re going to have to report this data in ways that are publicly accessible. So better to get a head start on it.

Sigelman: Bill, what gets measured gets managed. And I’d say, first and foremost, now that this is on the table, I want to make sure that companies are establishing metrics. One of the things that we’ve done here is, we’ve made the methodology quite transparent. So that methodology’s out and open, and we want companies to use it to be able to track mobility and their opportunity creation more generally going forward. Part of that means embedding that tracking into core processes. Change only happens when it becomes routinized. If this is a biannual thing where, okay, I guess somebody asked a question, “Let’s go ask Mary in the HR analytics team to measure something,” it’s not going to actually change. But if this becomes part of how we manage, then I think we’ve got a chance of seeing real change. That also means you’ve got to set goals. And to Joe’s point, to set goals, you need to benchmark. And I think that’s why, by the way, even for companies that aren’t on this list, that aren’t in the Fortune 250, there’s still something here. Because one of the things that we found is that there are clear standards that emerged for what’s good performance—for example, companies that are performing well, are retaining 70 percent of their workers after five years; companies that are performing well or providing people a promotion in, on average, no more than two years. So there’s sets of standards like that which are available as a basis for benchmarking.

Kerr: I know you’ve been getting some feedback since the Wall Street Journal article came out and otherwise. I’d love to hear more about the types of feedback. It sounds like some organizations may come to you and say, “We had no idea,” or “There’s no way we could have, from our internal systems, generated this type of information.”

Sigelman: So one of the things that has surprised me is how few rotten vegetables have been flung in my direction. I was expecting a hail of blunt objects from companies who are displeased with their standing. And actually I haven’t gotten much of that. As we talked about before, I think companies genuinely recognize that workers are a key stakeholder, that worker advancement is an important organizational priority. I don’t see anybody discounting that. I think there are, of course, questions in methodology: “This is new; how did this happen?” And I think we’ve tried to be very clear about what these kinds of data sets can allow us to say and what they can’t. Companies, to the extent that they can piece together their data from internal systems, a lot of this, they may be able to do more accurately themselves. We’d encourage them to do that. But I think this gives a way for companies to be able to track performance over time. It gives them a way of being able to, in a relative way, see how they’re faring compared to their peers.

Fuller: We have heard from several companies that perform pretty well and are pretty proud of themselves, and at least tell me just how good they were. I think consistent also, Bill, with what happened when we published our Hidden Workers: Untaped Talent paper last year, many of the companies that have either sent messages or called, they were very curious about the methodology, and they were very open to that they might gain some insight from this. Now, we were also very, very deliberate in the report to say, this is a first-time effort looking at data across three separate very large data sets. And so we understand that this is not auditable results. But since the methodology has been applied consistently to everybody, all the errors are going to be co-linear. And so, if we were putting this forward as a deterministic model, that would be one thing. But we’re really just saying this is a relative model, it’s new data. We’re trying to ask provocative questions. And most people have taken it in that spirit, as opposed to an attack on their ethics. And we have some companies with some very, very significant and widely publicized commitment to internal worker advancements that came out in the middle of the pack. So even though, those companies that might be a little offended after all this effort they put in have been responsive and said, “Well, okay, thank you. We’ll look at this data and see what it tells us.”

Sigelman: We also need to realize that there’s a level of patience and persistence that’s required, because those kinds of changes don’t happen very quickly. If you’re a company with a couple hundred thousand people in its workforce, implementing a good program today may bear out in worker mobility over a span of years. So I’d say to companies that look at these data and say, “Hey, we’re doing a lot of the right things. Why is it not showing up?” Well, it’s right to be impatient, and you need to keep at it.

Kerr: Let’s continue, though, a place where I think there’s increasing amounts of impatience—and that’s from investors. And earlier, we brought in ESG, which is environmental, social, and governance goals. And I’d like to have us think a little bit about how would this index be a part of some of those efforts. And is it complementary? Could it be a feed into it? To go back to a comment Joe made a little bit earlier, does it have to be auditable to really be influential in that kind of circle? And then there’s also a scale thing of, you’ve done 250 companies; is the data and the processes now such that we could expand it to all publicly traded companies or something that would factor into those types of reporting?

Fuller: Well, on the fit with ESG and reporting, I think that, at the very least, it’s going to be a complement to gathering and publicizing, making public data on ESG performance. Because lower-wage workers, workers without college degrees, do skew to being women and to being minorities. And so if we’re really looking through a DEI lens—a diversity, equity, inclusion lens—how your entry-level lower wage workers fare is a big contributor to your performance on DEI. And what’s particularly important is, so many companies now, in my estimation, have made very sincere and determined commitments to improve their performance on DEI, but they tend to view it through the lens of, “How do I hire a more diverse workforce?” as opposed to, “How do I advance diverse workers who are in my organization?” And we think the American Opportunity Index really puts a spotlight on that. Most large companies have very diverse frontline workforces. They don’t have very diverse middle-level, upper, and senior management. And growing from within is going to be an integral part of achieving people’s goals in DEI, rather than hiring laterally from other companies and basically beggaring thy neighbor by getting in wage and terms and conditions fights to make up for the fact you haven’t built a system that causes workers to rise up as a company rises.

Sigelman: I would add this: There’s a fundamental question here. Are you adding value to your workers? Or put differently, are they better off for the time they spend working at your company? And what I think this does is, it creates a yardstick for measuring that. And I think that is fundamentally an ESG metric in a framework that recognizes that worker progresses is a core constituency. And when I think about ESG, ESG is about impact. And impact has to be measured through outcomes, not through intentions. So we do believe that the metrics—not just the overall ranking, but the core metrics of access, mobility, and wage—are all key measures that can track company’s progress over time.

Kerr: And of course, as we record this in the fall of 2022, there are some concerns about ESG measurements. And so it may be useful and important that this index can evolve on its own, regardless of how the ESG metrics get defined toward the future and their uptake.

Fuller: I think, Bill, that ESG, as people have discussed it and how to measure it, it’s really still evolving. There are some criticisms of blunt in just, literally, what percentage of your workers are from this ethnic group or this gender that smacks of quotas and gets engaged in all sorts of political crosscurrents that are very much on people’s minds in the United States in the fall of 2022? But what the index does is, in some ways, sets that aside and just says, “Here is your workforce. Here are the opportunities for workers that don’t have college degrees to build a better life, a more stable career, with richer prospects going forward.” And it’s completely blind to gender, race, ethnicity, immigration status. Just, “This is who you employ, and this is the impact of their early career on their prospects.” And I think it would be hopeful that this, in some ways, neutralizes some of those conversations or some of those complaints and just says, “Your workforce is who they are and your policies have a huge variable impact on their capacity to grow their prospects, and therefore, their income, and therefore, their economic security.”

Sigelman: One of the reasons why we undertook this project is because we think that workers and their advancement can’t just be a problem that depends on goodwill. It can’t just be something where we’re looking for companies to extend goodwill in trying to address this. This is something where companies benefit. When workers rise, they are taking on higher-value work, they’re becoming more productive, they’re staying. These are all things that have significant commercial benefits. So I also want to be clear that, as much as our motivations are to see workers rise, this is work that’s important and which employers should track, because it’s critical to their value as firms.

Kerr: Let me move to another institution that we haven’t spoken much about, which is the public sector and also policy makers. And I guess I have a two-part question. Part one is, would you imagine doing a similar type of index for the state of Massachusetts or the city of Boston or public sector employees? And then second, recognizing this as that first crack at a new index, are we to the point of making policy implications or some recommendations that come out of that? Or is that to come further down the line?

Sigelman: So, Bill, where I thought you were going when you were talking about states with the Commonwealth of Massachusetts or elsewhere is how we can abstract the methodologies that we’ve developed here, the measures that we’ve developed—from the firm level to the community level. And you’re right. There’s a question here of governments as employers themselves who need to be making opportunities for their workers. But there’s a broader question for policy makers: “How do I understand the mobility of a region’s workforce? Where are people moving up? Who’s getting stuck?” And I think those are crucial questions which we’re looking forward to exploring.

Fuller: I think that policy makers, this raises some interesting questions for them. Should they, in fact, be providing incentives or encouragements for upward advancement, as opposed to, for example, benefits for forming new jobs? How do they reconsider their support through things like workforce boards for employees who are seeking to advance where they’re employed as opposed to unemployed seeking a new position? How do resources like community colleges get equipped, encouraged, funded to help employers build better career paths for their incumbent workers? The whole system right now really focuses on two dynamics. The first is, education to employment transitions. So I have someone who’s in education, let’s say, coming out of a K–12 program, high school graduate, or in a community college. What can we do to help them improve their odds of employment early in a decent job? The second is, the unemployed—either mid-career or early career—how do we place them? We don’t really think of government having a catalytic role in taking people who are in employment, but in a fairly marginal position economically, and just giving them that extra leg up so that they can get a certification, a qualification, improvement in English language skills, whatever it is, through their employer to get on that better pathway. So I think it does open some new questions for reflection, especially in a country which isn’t going to have a lot of absolute growth in its workforce. Political executives should be keenly interested in steps that help workers become more productive, because productivity in the United States has got to grow for general economic growth to keep at a decent level, given the fact that the workforce is not growing at a high nominal rate. And workforce growth is a big part of historical economic growth in our GDP.

Sigelman: Every governor wants to be the jobs governor, but this changes the metrics of that—from job creation to job quality and worker mobility. Similarly, every governor wants to be, to Joe’s point, a growth governor, but what’s the talent base that we need to support growth? And that can’t just be a question of in-migration. Not every state’s going to be able to drive in-migration. How do you make sure that you have an escalator for mobility in the state where people are moving up, where, to Joe’s point, they’re becoming more productive over time? Ultimately, in order to grow, no matter what your growth sectors may be, you’ve got to have that dynamo of mobility.

Kerr: So Matt and Joe, we are coming to the final question here. We’ve talked a lot about ways we could extend this work, questions that have been raised, opportunities to measure for different sectors. What’s coming up next? What’s on the near-term horizon for the next steps that the two of you want to take?

Fuller: Well, Matt mentioned one earlier that we’ve been working on a methodology for trying to understand this through the lens of diversity, and we’ll be excited to do that. One of the things that we’ve mentioned a couple of times is that this compares people starting in the same occupation. And diversity data tends to be a big lump aggregate number. This is how diverse we are. Sometimes it’s stratified. So we’d really like to get into that detail. I think we would like to refine the current analysis—to make it more robust and get feedback from companies or other listeners who are interested as to how we could improve it and make it more compelling. And then, of course, you mentioned the notion of trying to expand the data set. There’s a lot of data, so I don’t think we’re going to get to all public companies. But could we expand it to another cohort? Potentially. And it would be interesting, finally, to work with third party groups—let’s say industry associations or groups like the Business Roundtable or the Chamber of Commerce—about, are there ways for us to take this framework and modify it so companies can actually apply their own data and get very specific insights, which maybe then they can use as a basis for contrasting with the more publicly available data we’re getting from public resources to ask sharper, better defined questions.

Sigelman: There’s three core areas that get us really excited about where to take this next. One is undertaking further study of the role employers are playing in worker mobility. That’s a core motivation of the index itself. A second is leveraging the underlying methodology—this first-of-its-kind ability to measure worker experience from a mobility perspective—for a broader study of mobility and what drives it. And then third is to start applying some of these things in practice. So in terms of that first category further, we’ve created the yardstick—we want to understand what are the practices that do drive mobility most effectively. How important is worker mobility to firm-level performance?—a range of questions like that, I think, in terms of leveraging this methodology more broadly. We were talking before about what it would look like if you had a mobility atlas for the Commonwealth of Massachusetts. But also questions like, what are the sets of roles and the sets of skills within roles that tend to move the needle most for workers? And then, I think, in terms of applying these in practice, Joe outlined before some of the ways that you really need to bring together a broad ecosystem of community colleges, of employers, of workforce training organizations and the like within a region. What would it look like if all of that were oriented toward mobility?

Kerr: Matt and Joe, we thank you and your colleagues for the American Opportunity Index and appreciate you coming on today and telling us about it.

Sigelman: Thanks so much, Bill.

Fuller: Really excited to share the research and hope we hear from some of our audience members about their reactions to it.

Kerr: We hope you enjoy the Managing the Future of Work podcast. If you haven’t already, please subscribe and rate the show wherever you get your podcasts. You can find out more about the Managing the Future of Work Project at our website hbs.edu/managingthefutureofwork. While you’re there, sign up for our newsletter.

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Manjari Raman
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Harvard Business School
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