More Educated Than Ever, Still Unequal: The Fantasy Economy of Skills Shortages, by Angela Valenzuela, Ph.D.

More Educated Than Ever, Still Unequal: The Fantasy Economy of Skills Shortages

by 

Angela Valenzuela, Ph.D.

October 1, 2025

I have been reflecting on a newly-published essay by Neil Kraus, a political scientist from the University of Wisconsin–River Falls, published in the Summer 2025 issue of American Educator, as it hits close to home for those of us fighting for public education. Here is a summary, which I also plan to share with my students, as it is full of insights debunking myths about neoliberalism (‘capitalism on steroids’) and its intersections with labor market and education data.

Kraus calls out what he terms the “fantasy economy,” the decades-long myth that the United States is a knowledge economy bursting with high-skill, high-wage jobs, and that our schools and universities are “failing” to produce workers ready to take them on (Kraus, 2025). 

From a global perspective, this is consistent with Karen Hao’s book The Empire of AI, which finds that the so-called knowledge economy is in fact deeply uneven, built on precarious and low-wage labor across the globe, particularly in the Global South. 

Hao shows how the myth of endless high-skill opportunities obscures the exploitative underpinnings of the AI economy—data labeling, content moderation, and other hidden forms of digital labor—that mirror the same structural inequalities Kraus critiques. Both reveal how these myths function to misdirect blame toward schools while legitimating an economic system that thrives on inequality and dispossession.

It’s a story we’ve all heard. Business leaders, politicians, and the media repeat it so often that it feels like common sense: if only schools would do a better job, if only students worked harder, then prosperity would follow. But the data—and our lived experience—say otherwise.

The truth is that Americans are more educated today than ever before. Nearly 70 percent of adults have education beyond high school. And yet, roughly 60 percent of jobs still require nothing more than a high school diploma or less. A third of college graduates are underemployed, and about 40 percent of recent grads end up in jobs that don’t require their degrees. This mismatch—persisting for decades—shows that the economy remains dominated by low-wage service jobs, not high-skill opportunities.

The “skills gap” that business leaders love to talk about is not real. There’s an oversupply of well-educated workers, not a shortage. The same is true in STEM.Despite constant claims of a STEM shortage, such jobs make up only about 6 percent of the labor market, a share that has barely changed, and many STEM graduates remain underemployed. (Carnevale et al., 2023; Mishel & Bivens, 2021).

So why does this myth persist? Because it is useful—especially to corporate America. By blaming schools and colleges for economic inequality, corporations deflect attention away from their own role in depressing wages, offshoring jobs, busting unions, consolidating power, manipulating tax policy, and driving inequality ever higher. In this way, the “failure of education” becomes a convenient scapegoat, while the structural forces that actually shape the economy remain largely unchallenged. 

When corporations blame schools, whether K-12 or higher education this justifies cuts, tuition hikes, undermining faculty, and narrowing the curriculum —all while corporations rake in profits and pay less in taxes.

This is the heart of neoliberalism, the system ushered in during the Reagan years and still with us today. 

Neoliberalism tells us that the market solves all problems and that public goods like education must be cut, privatized, or turned into revenue streams for the wealthy. It tells us to accept online education as the future, not because it’s better for students but because it saves money for administrators and enriches tech companies.

But we know better. Education is not the problem; inequality is. Americans are better educated than at any point in history, yet wages have been flat for most workers for over forty years while wealth has soared at the very top (Mishel & Bivens, 2021). That’s not on teachers, professors, or students—that’s on a political and economic system designed to benefit shareholders over communities.

While Kraus powerfully exposes the myth of the “fantasy economy,” his analysis unfortunately does not explicitly take up the question of race or gender. When we add that lens, the picture becomes even clearer—and more troubling.

Students of color have made significant strides in educational attainment over the past several decades. Black, Latino, and Indigenous students are graduating from high school and college at higher rates than ever before. Yet racial and gender wage gaps remain stubbornly wide, revealing the hollowness of the ‘great equalizer’ narrative

A Black worker with a bachelor’s degree earns less, on average, than a white worker with the same credential, while Latino and Indigenous workers face similar disparities (Carnevale et al., 2014; Gould, 2020; Scott-Clayton & Li, 2016). Hence, both systemic racism and sexism continue to structure labor market outcomes regardless of attainment.

Source: Gould, E. (2020). State of working America wages 2019. Economic Policy Institute. https://www.epi.org/publication/swa-wages-2019/

This racialized reality and gender gaps expose just how false the skills-gap narrative really is. If education alone could fix inequality, then rising attainment among communities of color and women would have narrowed economic gaps. But the opposite has often been true. What persists is not a failure of schools, but the endurance of structural racism and sexism in hiring, wages, and opportunity.

Moreover, neoliberal reforms that elevate STEM and “workforce readiness”—combined with such discourse as "return on investment" often come at the expense of Ethnic Studies and the humanities—fields that affirm identity, build civic capacity, and offer the critical perspectives that communities of color have long fought to preserve (Sleeter, 2011). By insisting that education’s value is only economic, the fantasy economy erases not only the realities of structural racism but also the democratic and cultural purposes of schooling.

To wit, analyses of race deepen Kraus’ argument that the attack on education is not just about shifting blame for inequality from corporate actors to schools—it is also about obscuring how racial capitalism continues to marginalize Black, Brown, and Indigenous communities, regardless of how much formal education they achieve (Taylor, 2016).

In summary, to reclaim education as a public good, we must expose the fantasy economy as a lie that justifies austerity. Education is not just job training—it is preparation for democracy, citizenship, and human flourishing.” The wealthiest country in the world can afford great schools and universities for every student. The question is not whether we can, but whether we will choose people over corporate profits. As Kraus credibly conveys, that’s the struggle before us.

References

Carnevale, A. P., Fasules, M. L., & Campbell, K. P. (2014). Race, ethnicity, and the college completion gap. Georgetown University Center on Education and the Workforce.

Carnevale, A. P., Smith, N., & Strohl, J. (2023). The recovery: Job growth and education requirements through 2031. Georgetown University Center on Education and the Workforce.

Gould, E. (2020). State of working America wages 2019. Economic Policy Institute. https://www.epi.org/publication/swa-wages-2019/

Hao, K. (2024). Empire of AI: Dreams and Nightmares in Sam Altman's OpenAI. Penguin Press.

Kraus, N. (2025). The fantasy economy: Neoliberalism, inequality, and the education reform movement. American Educator, 49(3), 12–21.

Mishel, L., & Bivens, J. (2021). Identifying the policy levers generating wage suppression and wage inequality. Economic Policy Institute.

Scott-Clayton, J., & Li, J. (2016). Black-white disparity in student loan debt more than triples after graduation. Brookings Institution. https://www.brookings.edu/articles/black-white-disparity-in-student-loan-debt-more-than-triples-after-graduation/

Sleeter, C. E. (2011). The academic and social value of ethnic studies: A research review. National Education Association.

Taylor, K. Y. (2016). From #BlackLivesMatter to Black liberation. Haymarket Books.

How Environmental Destruction Fosters Epidemics and the World Over by Dennis Sanders

This is one of the best big-picture views I've come across in awhile on how not just "human activity," a euphemism, but capitalism, our economic system, is destroying the natural habitats from which viruses emerge. This has involved the mass destruction of forests in order to raise farm animals as well as for the harvesting of palm oil production, fracking, including the "out-of-control extraction of oil shale from Canadian tar sands," and so on, all at an alarming pace. 

The unending search for precious metals and minerals together with the wild animal global trade means that humans are entering spaces where deadly pathogens live, facilitating their transfer from animals to humans.  Along with an international re-commitment to the The Paris Agreement, supporting a Green New Deal that seeks to wean us from fossil fuels, and a global reforestation project, it makes great sense as this piece posits, to tax industries like mining, agriculture, oil and gas to fund the restoration of the planet.

I am encouraged by Presidential candidate Joe Biden's plan to get our country to a 100% clean energy economy with net-zero emissions by 2050. From everything I have learned about climate change after having taught a college course on it, that timetable itself is late, even if it's realistic.  However, it's infinitely better than no leadership at all as we are witnessing from a president whose rollbacks on environmental policies favor more pollution and a loss of protection for endangered species.

To all of this, I would add that we as the late Brazilian educator, Paolo Freire admonished, we need to put all student learning at the service of social justice. Can you imagine how powerful it would be if every kindergartner in the world were responsible for planting a small tree and watching it grow? This will guarantee that tree's survival, but also all of humanity's, as well. It's noteworthy that for many if not most, COVID is impacting their respiratory system. To me, this sounds like Mother Earth telling us that Her respiratory system is suffering, as well. 

She can’t breathe. And if she can’t breathe, we’re doomed as a human species. 

Forewarned is forearmed. None of us want either for ourselves or our children and grandchildren an Earth that is uninhabitable. Please do read David Wallace-Wells' book, “The Uninhabitable Earth,” to grasp where we are headed that strangely, the COVID virus—that has arrested our customary comings and goings—is signaling to all of humanity, regardless of whether your state, city, county, or country got it under control.

It's clear that our country and world are desperate for leadership that not only believes, but also fully embraces the science of climate change, lest millions more perish from epic diseases and illnesses like COVID together with devastating environmental effects of our Earth mother convulsing with equally epic wildfires, droughts, hurricanes, hail storms, earthquakes, pestilence, and tornadoes. 

Our Earth is out of balance and this COVID moment that we virtually all experiencing in some form or fashion as a planet should heighten our resolve for bold, new leadership with courage to address the spinning of a world that is out of control—even as this is an artifact of our own creation.

-Angela Valenzuela

How Environmental Destruction Fosters Epidemics and the World Over

by Dennis Sanders | Freedom Socialist (Aug.-Sept. 2020)

The outbreak of Covid-19 has turned the world on its head. It has shut down entire economies and destroyed the equivalent of 305 million full-time jobs globally just in the second quarter of 2020, according to the International Labor Organization. In the U.S. and many countries, it has exposed the racial and gender inequalities that have always existed, as well as the starvation of public health systems and preparedness for emerging diseases.

For many in the Americas and Europe, it seems as if the virus came out of nowhere. Others in Asia and Africa (from which many of the new diseases have emerged) have seen this before.

In fact, scientists specializing in virology, biology and the climate have been studying human encroachment into wild habitats and destruction of species and ecosystems for decades. They have increasingly concluded that there is a causal relationship between environmental degradation and the creation of deadly human diseases. A recent study found that new infectious disease outbreaks have more than tripled every decade since the 1980s.

The balance of nature altered. The profit-based system we live under has drastically eroded biodiversity and fragmented ecosystems. With the expansion of large urban centers, ongoing extraction of materials from the earth, deforestation, and land development for large-scale industry and factory farming, increasing numbers of natural ecosystems are being destroyed or fragmented. Human proximity to animals that they previously would rarely come in contact with increases, putting everyone at greater risk.

Scientists consider viruses, as part of nature’s diversity, to be in a “gray area” between living and non-living. They cannot self-replicate, but they can multiply in a host. They can cause disease in that species, or others that they “jump” to. In intact ecosystems, human beings are seldom impacted.

But in our fractured environment, the risk is breathtaking. The U.S. Centers for Disease Control estimates that 60 percent of known infectious diseases in people are “zoonotic,” meaning they are passed from other animals to humans.

Three of every four diseases that have emerged among humans in the last 30 years are of this type. Zika, HIV, Hendra, Avian Flu (H5N1), Nipah, Swine Flu of 2009, SARS, MERS, Ebola, and Covid-19 are all zoonotic diseases. A study by public agencies in Kenya, Great Britain and Vietnam estimates that these diseases kill over 2 million people annually and infect over one billion.

Market domination of the planet and its resources is depleting all species and the places they live at an alarming rate.

This is Slavery. How Trump is Helping Tycoons Exploit the Pandemic by Jane Mayer

This is outrageous and upsetting.  Give this a close read to learn about American slavery, as an African American woman interviewed for this story exclaimed. It's shocking and disgusting to read about how during a pandemic, Trump is loosening every regulation imaginable right now—from poultry and meat packing plants, to trucking companies and oil and gas pipelines. The New Yorker's focus here is on poultry companies who are hyper-exploiting their workers right now. 

This is happening as their greedy corporate bosses are delivering between 2 and 3 million dollars to the Trump campaign. Get this. They are his biggest campaign contributors,

This is Coronoavirus, disaster capitalism, my friends, that is literally sacrificing, Latinos, African Americans, and Asian Americans to highly dangerous, toxic, prison-like, freezing working conditions in plants where production rates of Birds Per Minute—while standing next to COVID-infected employees in COVID-infected plants—reach ever-higher, plateaus. 

It's terrifying to read that these companies have stopped generating official data for the public which, of course means, that the general public is also sacrificed and at risk.

Untold numbers are dying. This is inhumane. We need an abolitionist movement for what is happening in these industries hidden away from public view, reminiscent of Upton Sinclair's famous 1906 novel, The Jungle [free download available].

"The book so shocked Americans that President Theodore Roosevelt ordered an immediate investigation of slaughterhouses. The result was landmark consumer-protection legislation that formed the foundation of today’s Food and Drug Administration."

We need an FDR. We need consumer and worker protections all over again in this country. Here is one small, meaningful action we can all take today.  Please sign this petition—Poultry Companies: Give workers essential benefits and safe conditions during COVID19 where you can also make a contribution. National LULAC is also taking this on under the brilliant leadership of Domingo Garcia and Sindy Benavides.

This whole system needs to be upended. We need a national campaign to boycott any plant that treats its workers so horrifically. 

Just the thought of chicken produced under these conditions makes my stomach churn anyway.

Aside from the general principle of the matter, it's for the good of everybody's health and welfare. You may want to go straight to the NY website, as I just did, to listen to the audio version of this story.  The narrator, presumably the author, Jane Mayer, does an excellent job. Hearing her tell the story made it even more impactful for me.  So impactful that I had to blog about this right away.

-Angela Valenzuela

#BlackLivesMatter
#BrownLivesMatter
#AsianLivesMatter
#CoronavirusCapitalism
#AbolishSlavery
#AbolishSlaveryInAmerica

A Reporter at Large

July 20, 2020 Issue

How Trump Is Helping Tycoons Exploit the Pandemic

The secretive titan behind one of America’s largest poultry companies, who is also one of the President’s top donors, is ruthlessly leveraging the coronavirus crisis—and his vast fortune—to strip workers of protections.

By Jane Mayer

July 13, 2020

 Ronald Cameron, the head of Mountaire, which critics call a “brutal” employer, is one of Trump’s top donors.Illustration by Cleon Peterson

On June 22nd, in the baking heat of a parking lot a few miles inland from Delaware’s beaches, several dozen poultry workers, many of them Black or Latino, gathered to decry the conditions at a local poultry plant owned by one of President Donald Trump’s biggest campaign contributors. “We’re here for a reason that is atrocious,” Nelson Hill, an official with the United Food and Commercial Workers International Union, told the small but boisterous crowd, which included top Democratic officials from the state, among them Senator Chris Coons. The union, part of the A.F.L.-C.I.O., represents some 1.3 million laborers in poultry-processing and meatpacking plants, as well as workers in grocery stores and retail establishments. Its members, many defined as “essential” workers—without the option of staying home—have been hit extraordinarily hard by the coronavirus. The union estimates that nearly thirty thousand of its workers in the food and health-care sectors have contracted covid-19, and that two hundred and thirty-eight of those have died.

For the previous forty-two years, a thousand or so laborers at the local processing plant, in Selbyville, had been represented by Local 27. Just two years earlier, the workers there had ratified a new five-year contract. But, Hill told the crowd, in the middle of the pandemic, as the number of infected workers soared, the plant’s owner, Mountaire Corporation—one of the country’s largest purveyors of chicken—conspired, along with Donald Trump, to “kick us out.”

Hill, who is Black and from a working-class family on the Delmarva Peninsula—a scrubby stretch of farmland that includes parts of Delaware, Maryland, and Virginia—was used to the area’s heat and humidity. But, as he spoke to the crowd, behind dark glasses, his face glistened with anger. “It’s greed, that’s what it is,” he said. “It’s a damn shame.”

The jobs at Mountaire rank as among the most dangerous and worst paid in America. Government statistics indicate that poultry and meat-processing companies report more severe injuries than other industries commonly assumed to be more hazardous, including coal mining and sawmilling. Between 2015 and 2018, on average, a slaughterhouse worker lost a body part, or went to the hospital for in-patient treatment, about every other day. Unlike meatpackers, two-thirds of whom belong to unions, only about a third of poultry workers are represented by organized labor—and those who are unionized face mounting pressure. The industry, which is dominated by large multinational corporations such as Mountaire, has grown increasingly concentrated, expanding its political influence while replacing unionized employees with contract hires, often immigrants or refugees. These vulnerable workers are technically hired by temp agencies, relieving poultry plants of accountability if documentation is lacking. Trump has weakened federal oversight of the industry while accepting millions of dollars in political donations from some of its most powerful figures, including Ronald Cameron, Mountaire’s reclusive owner. In 2016, Cameron gave nearly three million dollars to organizations supporting Trump’s candidacy.

Founded in Little Rock, Arkansas, but incorporated in Delaware, Mountaire has operations in five states. It reportedly generated more than $2.3 billion in revenue last year. Because it is owned almost entirely by Cameron—and because it supplies poultry to other companies that put their own labels on the meat—the company’s public profile is virtually nonexistent. Cameron himself has received almost no media attention. “I’ve tried mightily over the years to bump into him, but he lays low,” Max Brantley, a longtime editor at the Arkansas Times, told me. According to trade journals, however, Mountaire has been spectacularly successful. Arkansas Business reported that the company’s sales in 2019 were a billion dollars higher than they were in 2010, nearly doubling the size of the business. Information on profits isn’t available, but as Mountaire’s revenues have risen wages for poultry workers have fallen even further behind. In 2002, workers were paid twenty-four per cent less than the national average for manufacturing jobs; today, they are paid forty-four per cent less. On average, poultry workers now earn less than fourteen dollars an hour.

By long-standing custom, labor contracts are binding for at least three years, giving a union time to prove its value to members. But in April a laborer at the Selbyville plant, Oscar Cruz Sosa, raised a legal objection to the contract, arguing that he’d been forced to join the union and pay dues against his will. He wanted a vote on whether to decertify the union. Mountaire maintains that it played no role in Cruz Sosa’s actions, and that the move to decertify the union was “entirely employee-driven.” But Cruz Sosa has had some outside help. His case was supported by lawyers from the National Right to Work Legal Defense Foundation, the foremost anti-union advocacy group, which is funded by undisclosed tax-deductible donations. Meanwhile, a mysterious group calling itself the Oscar Cruz Committee for Employee Rights sent out mailings, in English, supporting Cruz Sosa’s complaint. (Cruz Sosa speaks only Spanish.) The return address was the Rehoboth Beach branch of MailBiz, which rents post-office boxes.

Jonathan Williams, a spokesperson for the union, suspects that Cruz Sosa was a stalking horse. “It’s not hard to find one individual, who may get special privileges from management, and who maybe is offered a future position,” he told me. “It’s very, very rare, though, when an employee does the research, contacts the Department of Labor, and goes through all this effort. Usually, someone is being coached.” (Cruz Sosa didn’t respond to interview requests.)

When the union reached out to Cruz Sosa, his lawyers filed a grievance with the National Labor Relations Board, claiming harassment. The specific legal dispute is abstruse. Mark Mix, the president of the National Right to Work Legal Defense Foundation, has called the contract’s language “illegal,” claiming that it didn’t make sufficiently clear that—as stipulated by law—new employees had thirty days to decide whether to join the union. The union argues that applications presented to new employees are unambiguous about the time frame, and says that the current contract has virtually the same boilerplate used in every contract with Mountaire since 1982.

After Cruz Sosa got thirty per cent of his co-workers to sign a petition, the National Labor Relations Board ordered an election at the Selbyville plant. When the union protested that this would violate the customary bar on overturning contracts before three years, the N.L.R.B. decided to broaden the case, reëxamining the entire concept of barring challenges to settled union contracts. The move has shocked labor-law experts. By statute, the N.L.R.B. has five members and is bipartisan, but the Trump Administration has filled only three seats, all with Republicans.

Given the pandemic, the union argued that there was no way an in-person election could be safely and fairly held in Sussex County, where Selbyville is situated. Delaware’s governor had declared a state of emergency on March 23rd, because of the surge in covid-19 cases, almost half of them in Sussex County, which has many poultry plants. The union asked for a stay, but on June 24th the N.L.R.B. moved to proceed with the election, by mail. The ballots that were sent out must be received by July 14th. Meanwhile, the board will weigh the larger question of whether such elections are legal, potentially overturning a precedent that dates back to the New Deal.

“We’re really being let down by the federal agencies,” Williams, the union spokesperson, said. He also lamented a shift at the Occupational Safety and Health Administration, the division of the Labor Department that enforces workplace safety. Since osha’s inception, in 1970, the agency has enforced federal law that makes it illegal to subject employees to “recognized hazards.” But during the pandemic the Times editorial board has been prompted to ask, “Why is osha awol?” Democrats pushed for the agency to issue an emergency rule forcing businesses to comply with the Centers for Disease Control’s health guidelines for covid-19, but the Labor Department refused.

Instead, on April 28th, forty-eight hours after Tyson Foods, the world’s second-largest meat company, ran a full-page ad in several newspapers warning that “the food supply chain is breaking,” Trump issued an executive order defining slaughterhouse workers as essential. The White House had appointed Cameron to an advisory board on the pandemic’s economic impact. The executive order commanded meat-processing facilities to “continue operations uninterrupted to the extent possible.” The Labor Department released an accompanying statement that all but indemnified companies for exposing workers to covid-19. It assured employers in essential industries that the agency wouldn’t hold them responsible if they failed to follow the C.D.C.’s health guidelines, as long as they made a “good faith” effort.

Meat and poultry workers had to keep working and risk infection—or lose their jobs. By July 7th, osha had received more than six thousand coronavirus-related workplace complaints but had issued only one citation, to a nursing home in Georgia. David Michaels, a professor of public health at George Washington University, who headed osha during the Obama Administration, told me that the agency was “saying that the Labor Department would side with the employers if workers sued,” and added, “That would be unthinkable in any other Administration. osha’s job isn’t to protect corporations—it’s to protect workers!”

The prospect of food shortages understandably caused concern in the White House. Yet reports show that in April, as Tyson and other producers were warning that “millions of pounds of meat will disappear” from American stores if they had to shut down, exports of pork to China broke records—and Mountaire’s chicken exports were 3.4 per cent higher than they were a year earlier. The next month, the company’s exports were 10.9 per cent lower than in 2019, but its exports to China and Hong Kong grew by 23.1 per cent in April and by fourteen per cent in May, according to statistics provided by Christopher Rogers, an analyst with Panjiva, which tracks the food-supply chain. Tony Corbo, a lobbyist for Food and Water Watch, a progressive nonprofit advocacy group, said, “They were crying about shortages, and yet we’re still exporting meat. The shortage was phony.”

Meanwhile, coronavirus cases exploded in the meat-and-poultry industry. Initially, Mountaire released statistics about employee infections. At the end of March, the company told the union that there had been forty-one cases in Selbyville. However, Hill’s shop steward, Manuel Rosales, told him not to trust this number. “Half the plant isn’t there,” he explained, either because the workers were sick or because they feared becoming so. A month later, a television station in North Carolina reported that a Mountaire plant, in Siler City, which employs some sixteen hundred workers, had at least seventy-four positive cases among workers and their families. After that, the company stopped sharing its covid-19 numbers. Mountaire became so secretive, Hill said, that workers “were seeing people disappear, and they didn’t know what the hell was going on.” In many cases, a “co-worker had tested positive, but the company wouldn’t tell anyone.” Rosales, who works in the deboning department at the Selbyville plant, told me, “People are coughing and they don’t look well, but they just want to keep the chicken coming. It’s all hush-hush.”

Cathy Bassett, the communications director for Mountaire Farms of Delaware, confirmed, “We’re not releasing any numbers,” adding, “I don’t even know those numbers. We’ve told our workers that if you’ve been exposed we’ll notify you.” According to Hill, the company argued to the union that it was protecting employee privacy. “They were hiding behind it,” Hill told me. “We weren’t asking for private health information—we were just trying to report the numbers.”