In his annual letter to shareholders, longtime JPMorgan Chase Chairman and CEO Jamie Dimon said there are only two ways of mending the “frayed American dream.” Neither of them have to do with banking.
America is rife with policy errors that need to be remedied, Dimon wrote in his annual shareholder letter released on Tuesday. The pandemic vastly exacerbated income inequality and left millions in the lurch without a safety net, definitively killing the American Dream for some in the process. But Dimon believes moving towards skills-based hiring and paying minimum wage workers more could stem these issues.
Providing new workforce entrants with practical skills that will lead to better-paying jobs, he wrote, calling out a few industries—advanced manufacturing, cyber, data science and technology, and healthcare—that could make for ideal starting points. This would be good for economic growth, he wrote, “and much that ails us.”
Dimon has long supported skills-based hiring. In 2019, JPMorgan made a $350 million investment in a program called New Skills at Work, aimed at helping people from underserved populations develop critical, in-demand skills.
“The new world of work is about skills, not necessarily degrees,” Dimon said at the time, explaining that there's a skills gap between those stuck in low-skill jobs and business who can't find the skilled workers they need. “We must remove the stigma of a community college and career education, look for opportunities to upskill or reskill workers, and give those who have been left behind the chance to compete for well-paying careers today and tomorrow."
Four years later, his new shareholder letter echoes his earlier sentiment.
Schools should collaborate with local businesses on skills-training programs that prepare graduates for specific jobs, Dimon wrote, in a country with 10.8 million job openings and 5.9 million unemployed workers. Gen Z, the fastest-growing group of workers, feels the same way, saying that America is failing to provide them with the digital skills they need to enter the workforce.
Critically, businesses—especially those, like JPMorgan, in the Fortune 500—must be involved in this process, and the programs they devise must be offered in various local communities where the actual jobs are. Many companies—including LinkedIn, IBM and General Motors—have put a renewed emphasis on skills-based hiring. They’re meeting demand;
Dimon: Give people money
Then, there’s the second fix: Upping the pay for low-wage workers. Unskilled laborers are barely eking by on a so-called living wage. “It is hard to live on $15 an hour, particularly for families—even if two household members are working,” he said. “Jobs and living wages bring dignity, lead to more opportunity—in housing, education, childcare, health, and overall well-being—and also help rebuild communities as that income is used to improve how people live.”
It doesn’t help that inflation has made living frugally near-impossible; more than 8 in 10 middle class workers report needing to dip into their savings just to get by.
To that point, Dimon said the Earned Income Tax Credit (EITC), which supplements low- to moderate-income working people, should be reformed and expanded. Many people eligible for the credit don’t even know about it, and as such don’t receive it. “Proper reform…could increase benefits where deserved and reduce fraudulent and improper payments.”
EITC money would undoubtedly lift up lower-income neighborhoods, he added, because the money is spent entirely on lifting up families. “I also have little doubt that this would add to GDP—because most of this money would, in fact, be spent.”
In 2022, Dimon said he’s in favor of raising the minimum wage, and encouraged second chances for job applicants with minimal education or a criminal history.
"Give people a chance, and you'll get dedicated people who want to have those jobs," he said at the time, adding that some regulations make it unfairly difficult to hire workers. “It's staggering what you have to go through to get someone hired.”
