Enlarging Employer-sponsored Pipelines
As vocational education continues its rebirth in the twenty-first century economy, many employers are opening their eyes to the value and necessity of creating their own youth-focused pipelines of talent. Sometimes they build these in-house, sometimes through intermediaries, and sometimes through cross-sector collaborations. Usually these are a mix of self-interest and philanthropy. There are many outstanding models to choose from.
In the past decade, several impressive national initiatives have arisen with strong financial backing from businesses. These include JPMorgan Chase’s New Skills at Work and McKinsey’s Generation USA programs. Although relatively young, such initiatives are already making inroads in bridging employment gaps among the young.
In other instances employers are creating workforce training right within their for-profit mission. Companies such as Toyota and Southwire have made generalized training for the next generation of workers a regular part of their business structures. Others, such as Norton Healthcare, profiled in Chapter 7, have strong programs for training their incumbent workers to move up from lower-level to higher-skill positions.
It can sometimes be difficult for donors to see a clear way to invest in these kinds of ventures alongside for-profit businesses. The options, however, are many. For instance, donors might pay for structural supports for a for-profit venture, such as the Career Cruising software profiled in Chapter 5 that connects young people with job opportunities. Or fund a media campaign to publicize tech and manufacturing careers, funneling interested parties to a business-organized training effort. There are many other possibilities. Besides, corporate initiatives seldom exist in isolation, and none of the finest examples operate solo. They commonly work closely with intermediaries like nonprofits, schools, local agencies, and community groups. This offers numerous points of entry for wise and eager philanthropists.
Large corporate initiatives
Following are five corporate initiatives that are wide in scope and ambition: 100,000 Opportunities, LeadersUp, Generation USA, New Skills at Work, and Grads of Life.
100,000 Opportunities and LeadersUp
Launched in August 2015, the 100,000 Opportunities Initiative is a collaboration of employers and foundations to connect out-of-work and out-of-school youths with employment opportunities. (An adjunct benefit is that employers also receive an improved pipeline of talent.) Its goal is to engage at least 100,000 young people in apprenticeships, internships, and part- and full-time jobs by 2018, at nearly 30 employers like Target, T-Mobile, Hyatt, and J. C. Penney. Companies in the network have a chance to learn best practices for locating and employing what are called “opportunity youth,” to create efficiencies in recruitment and retention, and to gain easier access to pipelines of talent operated by allied nonprofit organizations. So far, the initiative is operating in four cities—Seattle, Los Angeles, Chicago, and Phoenix—and has attracted support from such private philanthropies as the Joyce Foundation, the W. K. Kellogg Foundation, the Schultz Family Foundation, and the Rockefeller Foundation.
Similarly, LeadersUp is an employer-led coalition that keeps a tight focus on giving participating companies a decent return on their investment. Launched in 2013 by the Starbucks Corporation, LeadersUp follows a step-by-step process. It begins with identifying employer needs, then connects employers to candidates in the population of opportunity youth. Finally, the initiative tracks results.
During its first two years in operation, LeadersUp connected over 1,000 youths with employment pathways, engaged more than 30 companies from three economic sectors, and achieved a 60 percent retention rate among new hires. The organization’s goal is to connect 5,000 opportunity youth with jobs, at over 100 businesses in ten U.S. markets, by 2017.
Another large effort in early development is the McKinsey Social Initiative’s Generation program. Funded by the international management consulting firm McKinsey & Company, Generation’s goal is to train and locate job placements for 1 million young people in five countries by 2020. The American portion of the effort is focused on achieving 200,000 placements over five years, focusing on three sectors: technology, health care, and customer service.
In 2015, Generation went live in ten cities across India, Kenya, Mexico, Spain, and the U.S. It has so far graduated 1,200 youths and achieved a 90 percent job placement rate. As of the writing of this guidebook, the U.S. chapter was operating in Florida (Jacksonville and Miami), California (San Jose and San Francisco), Delaware (Wilmington), Georgia (Atlanta), and Pennsylvania (Pittsburgh), with plans to expand its footprint to about 15 more U.S. cities in the near future. Generation USA relies heavily on steering young people into completing industry-recognized credentials. The technology track, for example, leads to CompTIA A+ and CompTIA Network+ certifications, which are well known in the business. These certifications allow typical graduates to work in computer user support or network-support roles at average wages of $18 to $30 per hour. Through the health-care track, young people obtain credentials as certified nurse assistants. The customer service path combines instruction on technical topics with training in interpersonal skills, so graduates will be qualified for jobs in this high-demand field.
Generation USA relies on partnerships with nonprofits such as Goodwill, which provides services that help students stay with the program, and with schools and community colleges in its operating cities. To keep employers interested, involved, and offering positions, the initiative collects detailed statistics on the bottom-line effects of well-trained young people, which can include things like improved profits and decreased turnover. Employer partners so far include hospitals, grocery-store chains, hotels, and retail outlets.
Generation USA is also working to attract young people and give them reasons to enroll in the program. One example is using data from the Gallup Wellness Index to show millennials that improving one’s job skill levels brings multiple life benefits. This is an area where donors might be able to help. Philanthropic backing for the Generation program also includes entities like the Walmart Foundation and the Sobrato Family Foundation.600,000 skilled production jobs were unfilled because employers couldn’t find qualified candidates.
New Skills at Work
Another mammoth corporate initiative is funded primarily by financial giant JPMorgan Chase. Called New Skills at Work, it is a five-year, $250 million plan. There are three central goals: support better data collection in this area, aid employer demand for middle-skill jobs, and create supply by training new technical workers.
Launched in December 2013, the initiative contributed $50 million in its first year to nonprofits in more than 130 cities worldwide. Within the U.S., New Skills at Work operates in 38 states, including 12 major metro regions where it has made investments topping $1 million or more. JPMC makes decisions on where to invest based on the size of their own corporate footprint—so Los Angeles, San Francisco, Denver, Seattle, Houston, Dallas, Chicago, and Miami dominate the market.
New Skills at Work collaborates with other groups interested in workforce development, including the National Academy Foundation, Aspen Institute, Jobs for the Future, National Fund for Workforce Solutions, Year Up, and YouthBuild USA. The initiative seeks to close achievement gaps and wage divides by analyzing what skills are missing in local job markets, targeting investments to local nonprofits and schools that have shown they can be effective vocational educators, and encouraging cross-sector cooperation and information sharing.
One snapshot of the program’s effectiveness is in Houston. Along with the Greater Houston Partnership and Shell Oil Company, JPMC created UpSkill Houston, a five-year plan to involve businesses, schools, and nonprofits in expanding the amount of good middle-skill work done in the Space City. JPMC donated $250,000 for that planning, part of its total $5 million pledge to the city. The project aims to make core economic sectors in the city—including petrochemical, construction, and health-care work—more efficient and productive.
One product, for instance, is a career-action platform that traces the availability of jobs in the local petrochemical sector. “You can see how an entry-level job is connected to a high-skill, higher-paying job, and understand that if you take the entry-level job, then earn additional credentials and certifications, you can move up the ladder,” notes Chauncy Lennon, head of workforce initiatives for JPMorgan Chase.
Grads of Life
One campaign on the cutting edge of making sure employers are on board and participating actively is Grads of Life. Its mission is to make the practical business case for expanding access to middle-skill jobs, for instance by hiring opportunity youth. A major goal is changing the perceptions of some employers that a college degree is the best marker as to which young people should be hired. Grads of Life principal Elyse Rosenblum says “our major goal is to catalyze employer demand” for hires with focused career and technical credentials.
The campaign identifies employers in the local community who need a consistent pipeline of new talent. It then helps employers find local nonprofits, schools, faith-based organizations, and government entities that can provide such employees. The group has used $43 million of donated advertising media, courtesy of the Ad Council and Arnold Worldwide, to support its efforts. The W. K. Kellogg Foundation has been an important funder, as have the Annie Casey, Gap, Rockefeller, and JPMorgan Chase foundations.
Lessons from training run by specific corporations
From a meta perspective, large-scale corporate initiatives are instructive for demonstrating best approaches to partnerships, collaborations, and evaluation. But in-house corporate CTE training programs go a step beyond by showing, in vivid color, how opportunities are unleashed for young people in tangible ways. In the following pages are case studies of five for-profit companies that have fine-tuned excellent training programs within their own four walls.
At Toyota Motor Corporation’s sprawling plant in Georgetown, Kentucky, a lot more is happening than turning out hundreds of thousands of new cars each year. Toyota is also minting highly skilled, eminently employable young people destined for high-paying, successful careers in advanced manufacturing.
Toyota’s Advanced Manufacturing Technician (AMT) program is one of the finest examples of an employer-sponsored effort to raise the skill level of new workers to the high standards needed by today’s best manufacturers. Housed at the largest Toyota manufacturing facility outside Japan, the program recruits high-school students to spend three days every week in the company’s advanced manufacturing center—a 12,000 square foot building meant to emulate a real manufacturing floor. The process is intensive, instructive, and fun. And life-changing for many participants.
Toyota created this training after realizing that too few skilled technicians existed in the pool of people applying for Toyota jobs to sustain high-quality production. Lots of other companies have come to the same conclusion. In 2011, Deloitte and the Advanced Manufacturing Institute estimated that 600,000 skilled-production and production-support jobs were unfilled because employers couldn’t find qualified candidates. “We aren’t coming to a crisis within the manufacturing industry,” says the director of Toyota’s program, Dennis Parker. “We’ve already entered a workforce crisis.”
Starting in the elementary and middle-school years, AMT helps expose students to STEM, technology, and manufacturing work through Project Lead The Way. High-school students who enroll in the AMT program then get a full-immersion experience. They end up with, in addition to their high-school degree, an associate degree in advanced manufacturing automation technology from a local college. They gain invaluable real-world experience at a top company. And they get paid. The program also instructs them in professional behavior.
“We’ve changed the learning environment,” Parker says. “We don’t think classrooms are very effective environments. They’re not realistic to the real world, so when we partner with a college, they agree to set up an open emulation of the manufacturing environment.” The program runs on a normal business schedule of eight-hour days—two where the kids are in class, and three where they are on the floor in an internship. Again mirroring a normal business environment, there is no summer break.
After completing the two-year program, students have three options for further training: a skilled technical internship leading directly to job, an engineering degree, or a bachelor’s degree focused on the manufacturing business. To maximize flexibility and independence, AMT doesn’t accept government support. And it’s selective about which colleges it partners with. The program uses a standardized curriculum across all eight states in which it has a presence. The program begins by knowing how many job slots they have to fill, and recruit carefully so they end up with excellent workers.We don’t think classrooms are very effective learning environments. They’re not realistic.
A big bonus: Students make enough money as they go to pay for future college costs (or something else if they choose). Those enrolled in the program earn between $12 and $19 per hour. Graduates hired right out of school will be paid $60,000-$70,000. Three quarters of AMT graduates finish their postsecondary training completely debt free, Parker notes.
What Toyota created in Georgetown has since blossomed to seven other states—West Virginia, Indiana, Minnesota, Texas, Tennessee, Alabama, and Missouri—and 180 companies. Toyota shared its knowledge with the Federation for Advanced Manufacturing Education, and in 2010 a joint AMT/FAME program began. This replicates across a variety of industries Toyota’s success at minting productive new workers with valuable skills. As of 2016, there are 19 AMT/FAME programs in operation. Eight of those are directly affiliated with the company that birthed the program; the remainder extend Toyota’s method to new firms and places.
There are several way donors could support the Toyota AMT/FAME program. One is by funding Project Lead The Way and other high-quality STEM education efforts. Philanthropists can also invest in the community colleges that partner with AMT/FAME.
Southwire, a privately owned company with close to $6 billion of annual sales and a 7,500-employee workforce, is America’s leading manufacturer of wire and cable used for electricity distribution and transmission. Its owners wanted to make substantial gifts to career and technical education, but didn’t want to do so through traditional foundation giving. So they decided to use their business itself to create a model that can easily be replicated across the country in small businesses.
Southwire’s 12 for Life program locates high-school students at risk of dropping out. Then it helps them complete their education, using the promise and potential of tech jobs. Participants are exposed to a real-world manufacturing environment, and the responsibilities and opportunities of an actual job.
Based in Georgia, Southwire launched the 12 for Life program in partnership with the Carroll County schools (located southwest of Atlanta) and the Florence City Schools (in northern Alabama). Starting in 2004, students were allowed to attend high school part-time and work shifts in an operating manufacturing plant. Southwire purchased a dedicated building for the Georgia-based program in 2006, and the next year a first cohort of 71 students began to participate in a more structured program. By 2009, the effort had met with so much success that Southwire purchased another building in Florence and mirrored the curriculum there. Southwire invested about $4 million to launch the program.
Students attend class part of every school day and then work a four-hour shift in the plant. According to Southwire, students learn “a variety of job skills, including machine operation, logistics, product and reel assembly, shipping, quality assurance and data entry.” They must be at least 16 years old, pass a drug-screening test, and have been identified by their district as needing assistance to graduate from high school. To help them earn their high-school degree, students receive credit for time on the job.
This isn’t merely an after-school pocket-money job. Students are immersed in the culture of Southwire and are considered part-time employees responsible for participating in company life. They are paired with mentors inside the company who guide them in many ways. In addition to teaching concrete job skills, the program helps young men and women learn how to manage their money, file and pay taxes, satisfy bosses, and work hard as a member of a team. It also convinces participants—students at high risk of dropping out—to remain in school and keep studying.
Results are promising. By mid-2015, more than 1,100 students have graduated from the program. Of these, 40 percent were able to go on to postsecondary education, 20 percent became full-time employees at Southwire, and 30 percent were accepted into the U.S. military.
The largest employer in the Philadelphia area, Penn Medicine, with 18,000 employees, created a vocational-technical initiative in 2007. What began as a summer program has evolved into an intensive, multiyear initiative in partnership with three high schools located in economically disadvantaged areas of Philadelphia. The program introduces young people in striking detail to career opportunities in the medical field.
Beginning in their junior year of high school, students take college-level courses, get job placements throughout the Penn Medicine system, and receive professional development instruction and coaching through mentorships. The program continues through the senior year. During the two-year high-school portion of the program students earn minimum wage and are on the job 10-15 hours per week. After they graduate from high school, students enter an internship, within which they are simultaneously enrolled in college and working 20 hours per week at a Penn Medicine facility. They are paid for a full 40-hour workweek, and their hourly wage jumps to about $18 an hour.
Entering students “really don’t know the diversity of jobs and careers and opportunities available in health care,” reports Frances Graham, Penn Medicine’s director of workforce development. Through careful selection, the Penn Medicine program has been able to maintain a 100 percent graduation rate, despite the tough backgrounds of many students in the participating high schools. Graduates of the program take up jobs in the medical field paying $16 to $18 per hour.
Dow Chemical, one of the 50 largest U.S. corporations, created an in-house apprenticeship program in 2015. The company hired about 50 young apprentices for placement across five locations—three facilities in Texas, one in California, and one in Michigan. Like other examples, Dow’s program combines classroom training with on-the-job instruction. Their effort last for three years. During that period, apprentices are paid on a full-time, 40-hour-per-week schedule for the combination of work, classroom time, and personal study that they put in.
At the completion of the apprenticeship program, graduates will have an associate degree from a local community college and a valuable track record of work experience. Those wanting to stay at Dow will be funneled immediately into one of two technical career paths at the company. Dow Chemical recruits candidates for this program from high schools, and also markets it to individuals transitioning out of the military.
As one of the largest clothing retailers in the U.S., Gap Inc. has significant experience hiring young, first-time workers. Beginning in 2007, the company’s foundation decided to parlay that expertise into an initiative that helps young people increase their skills above the entry level. Called This Way Ahead, the program provides training and internships for disadvantaged youth in ten U.S. cities (plus two in the United Kingdom).
This Way Ahead partners with nonprofits in targeted cities (including Goodwill, the Door, Enterprise for High School Students, and others, all of which depend on donor support) to present eight different workshops in various aspects of career training. At the conclusion of the training, youths interview for paid internships in stores across the corporate clothing empire (including Old Navy, Banana Republic, and Gap stores). The paid internship is ten weeks in duration, with 12 hours of work per week. Three fourths of the young people who start the training secure an internship.
“We found this combination of training from a nonprofit, coupled with a real working, paid experience structured as an internship, was successful,” says Gail Gershon of the Gap Foundation. “The results were so positive that our brands agreed to help us expand. We’ve found that our hired employees who started with This Way Ahead have double the retention rate of their peers, they have higher engagement scores, and they’ve turned into a great resource of talent.”