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GO! A Blog about Growth & Opportunity

This post originally appeared on Towards Employment's blog on June 27, 2018. Photo courtesy of staff photographer, United Way of Greater Cleveland.

This February, the Fund for Our Economic Future, a Northeast Ohio regional alliance of funders, published The Two Tomorrows and asked us all to make a choice for our future. Do we want it to be just average … or extraordinary?

Choosing extraordinary means committing to a vision and an agenda to “build a continuously regenerating economy that creates good jobs and rising incomes for everyone.” At Towards Employment, we emphatically choose extraordinary, and are vigorously working to refine our strategy and programming to ensure we are maximizing our contribution to achieving this outcome.

As a barrier to realizing this vision, The Two Tomorrows report highlights the role of economic polarization: between 2011 and 2015 average household income in Northeast Ohio rose 4 percent, while regional concentrations of poverty increased and the number of people living in those areas increased as well. So while we may be making progress in creating good jobs and rising incomes for some, not all parts of our community are included in this new found prosperity.

The Fund calls for action around three growth and opportunity areas: Creating jobs, preparing people for those jobs and ensuring that workers can commute to those jobs, through more thoughtful site selection and better transportation.

Towards Employment’s work is focused on preparing people for jobs and a career. The report defines the success metrics for this area as building skills for well-paying, in-demand jobs of today and tomorrow; improving job quality and building pathways to advancement; and reducing barriers to employment. Yes. Yes. And Yes. We know this works and have partnered with the Fund to generate the research to prove it.

With support from the Fund, Towards Employment led the implementation of a five-year, rigorously evaluated national pilot called WorkAdvance. WorkAdvance targeted low-income adults with barriers to employment and provided a comprehensive set of services, tied to in-demand jobs in growing industries with a focus on advancement, not just job placement.

When the results of the pilot were analyzed, Northeast Ohio participants had experienced a 14 percent increase in earnings overall, with a 22 percent increase for the later cohorts who participated in the more fully developed model. Participants were more likely to work in the targeted in-demand industry (health care or manufacturing) and to be working a regular shift, full-time or in a permanent job with opportunities for advancement.

What made the difference? Working in partnership with educational providers, industry associations, the public workforce system and other community service providers, WorkAdvance NEO provided the right service at the right time to address barriers, develop hard and soft skills, and gain necessary experience to obtain an in-demand job. Most importantly, WorkAdvance provided long-term coaching to support newly hired workers to succeed in their current job and to advance along a career pathway. These comprehensive and aligned services helped 50 percent of WorkAdvance participants advance within two years of entering the program, with an average hourly wage increase of over $2. (See below for an overview of WorkAdvance and the stories of two graduates.)

“Comprehensive” and “aligned” are broad terms that require some unpacking in the context of helping low-income job seekers prepare for in-demand jobs. The range of barriers people confront requires a flexible approach that includes legal advice and/or representation and help navigating public benefits, mediating child support, negotiating with landlords, coaching on credit/debt, budgeting and savings, as well as the more obvious supports for interview appropriate clothing, child care and transportation. WorkAdvance provided that flexible menu of supports, leveraging Towards Employment’s in-house legal services and case managers as well as connections to other community resources.

Anyone who has read Matthew Desmond’s Evicted (and if you haven’t you should) will recognize how a system can further penalize those with limited resources. And not just in housing: a front page Plain Dealer article notes Ohio has the second highest rate of drivers with suspended or revoked licenses in the country, with suspension rates much higher in ZIP codes where at least 50 percent of residents are below 200 percent of poverty. No license, no access to many of the new jobs being created that are not easily accessible by public transportation; no job, no ability to pay off outstanding fines that could lead to access to greater opportunity. This is the trap that comprehensive and aligned services can help people overcome. By helping address root causes, unraveling the tangle of compounding penalties related to lack of income, WorkAdvance has been able to put people onto a new path. See stories that highlight this struggle.

Almost a third of WorkAdvance participants had a criminal history, as an additional barrier. According to the Center for Economic and Policy Research, a criminal record can reduce annual earnings by 40 percent and has the potential to result in a loss of between $78 billion and $87 billion in gross domestic product each year. Each year, over 3,000 individuals return to our community after serving time, looking to rebuild their lives and contribute, yet they face many barriers both real (legal restrictions) and due to biases in practice. Once enrolled in WorkAdvance, individuals with criminal records got jobs and advanced after placement at the same rate as those without.

Since the conclusion of the WorkAdvance study, Towards Employment has worked to expand access to this industry-driven, advancement focused career pathway model for individuals involved in the criminal justice system, including, with the support of Cuyahoga County, starting while people are still incarcerated so that they are better prepared upon release. We must invest in people, whether they’re returning from incarceration or stuck in low wage jobs, with the education, training, and experience to fill open jobs. Not only do these jobs change lives for the individual, they can affect our local economy, with hundreds of thousands of dollars more in payroll taxes alone supporting our communities. The exact impact of how barriers are hindering this sort of change, however, has never been fully measured. That is why we are excited by the Fund’s commitment to research that will help shine light on the economic cost of legal barriers to employment for individuals with criminal backgrounds (collateral sanctions) and what we stand to gain by removing and addressing those barriers.

A troubling note: despite encouraging results through WorkAdvance, the benefits of a job and even subsequent advancements are not equally shared across race. The importance of the role of race on economic mobility, not just socio-economic status, is underscored by the results of a new study authored by Raj Chetty and Nathaniel Hendren (Two Americas: Upward Mobility for White vs. Black Children). They followed millions of children over several decades and found that virtually nowhere in the United States do black boys grow up to earn incomes equivalent to white boys raised in the same neighborhoods by parents with comparable wealth and education levels. “The findings show that race — not just parental income or neighborhood opportunities — factors into the yawning wealth gap between blacks and whites in America.” This shows up in Cleveland in statistics, highlighted in the Fund’s Two Tomorrows report where there is a 9-point differential in unemployment rates between blacks and whites, and a $20,000 annual earnings differential between blacks and whites.

To combat these trends, first we need to understand what our own data can tell us. General trends can mask serious disparities in outcomes. For example, despite the positive impact of WorkAdvance on low income participants, with particularly promising impact on long-term unemployed, a disaggregated analysis by race shows that black workers in similar jobs earned less than white workers. An additional study that Towards Employment commissioned by Policy Matters Ohio on young adult employment again showed similar results: young workers of color earned only about 81 percent of what white workers earned from 2013 to 2015. And a recent analysis of working participants who took the WorkKeys assessment though TalentNEO (a skills-based hiring initiative) showed that at every skill level, blacks earned less than whites. While this data represents a small sample size and is not a statistically rigorous analysis, the consistency of the data at national, regional and program levels is sobering.

Where do these findings leave us in terms of finding the route to becoming “extraordinary”? WorkAdvance research provides a promising roadmap for creating more success for individuals and businesses, with the conclusion that more investment in approaches that work is needed, rather than continuously re-inventing the wheel. We want to build on this successful programming to create more access to opportunity and more qualified workers for businesses. However the racial disparities seen in earnings, even when jobs and advancements are achieved, is something that we must work harder to understand and to address at every level. More to come on what Towards Employment is doing to expand career pathway programming with a racial equity lens and how we are starting with our own organizational policies and practices. Only with aligned efforts across individual, organizations and institutions committing to greater awareness and the hard but necessary actions to address complicated, entrenched systems that perpetuate these disparities will we find ourselves moving closer to extraordinary.