We classified occupations into three skill categories (low, medium, and high) using the BLS education and training requirements for occupation groups. The BLS requirements are straightforward and consistent with the CPS and OES. BLS classifies occupations in 11 groups according to their education and training requirements. We grouped occupations that require short-term (less than one month) on-the-job training as low-skill. This is the occupation category that requires the least level of education and training in the BLS classification. Examples of occupations in the low-skill category are retail salespersons, office clerks, cashiers, truck drivers, personal care and home health aides. We grouped occupations that require more than short-term on-the-job training, but less than a bachelors degree, as medium-skill. These occupations may require more on-the-job training, more work experience, vocational training, or an associates degree. We grouped occupations that require a bachelors degree or higher as high-skill.
One disadvantage of the BLS classification is that it does not indicate whether occupations require a high school degree. This should not be a problem, however, as CPS tabulations show that there is a mix of high school graduates and high school drop-outs in the population who received income from TANF in 1998 (see Exhibit 2.1).
Other researchers (Leete and Bania(35); Lerman, Loprest, and Ratcliffe(36)) have defined low-skill jobs to include both short-term and moderate-term training occupations. Leete and Bania also included long-term training occupations in their definition, but limited the percentage of welfare recipients who were eligible for these jobs. We chose to include only short-term training occupations in our definition because we believed these occupations would be affected most by welfare reform.
As discussed above, we assumed there were no regional differences between the occupational distribution of employment within an industry (i.e., differences in skill level resulted from differences in the industry mix of employment across regions). Appendix C presents a comparison of the percentage of 1998 employment by skill level from our estimates (ES-202 merged with the NISP) and the OES, which we were able to obtain for selected regions only. The percentage of employment that was low-skill was slightly lower from the ES-202/NISP than from OES.