Opportunity Youth & Business

Introduction

Finding employment in this economy is challenging, but imagine you are a young person who needs a job and has no experience. Then imagine you don’t have the right education and face other obstacles in your life that make getting that first job seem impossible.

According to a recent report from Columbia University and City University of New York, Queens College,¹ there are currently 6.7 million youth ages 16-24 who are not in school and not working. Finding solutions to re-engage these youth and get them on productive pathways is critical. In 2011 alone, the cost to the United States in lost revenues and social services associated with these youth was $93 billion.² Until recently, these youth have received limited attention in unemployment headlines and policy discussions. Ironically, at a time of high unemployment, America has a skills gap. Surveys of large and small employers tell us they cannot find qualified workers in the U.S. to fill their non-managerial ranks.³ We can no longer afford to ignore the untapped potential all young people represent and must redouble our efforts to educate and train them.

While many youth become disconnected from education and employment, we believe that with the right interventions and supports, these young people could begin to change the trajectory of their lives. Businesses can play an important role in making this happen and can help these youth get on a pathway to a better future. And businesses benefit from this work, too. Companies already involved in programs that serve this group of youth describe a range of positive outcomes resulting from these activities, including increases in employee engagement, customer loyalty, and employee retention.

A report from Civic Enterprises and America’s Promise Alliance⁴ provides an in-depth analysis of these youth, and helps us better understand their backgrounds as well as their visions for the future. This research has revealed that most of these youth are optimistic about their futures, they recognize that getting a good education and job is their own responsibility, and they describe the paths forward that are most likely to help reconnect them. These youth are therefore called “opportunity youth” because they represent tremendous opportunities for employers, communities, and the nation. The research tells us that opportunity youth are motivated to overcome the barriers they face, but they need support.

This toolkit is part of a larger effort, driven by the White House Council for Community Solutions, that focuses on re-engaging opportunity youth. The toolkit was created to guide employers, step-by-step, on working with opportunity youth, with the goals of 1) helping youth find pathways that will lead to productive adulthoods; 2) creating benefits to the businesses that engage opportunity youth; and 3) improving community outcomes which can lead to decreasing the financial burden now experienced by the American taxpayer and the United States.

Who are opportunity youth? What barriers do they face?

Opportunity youth come from varied backgrounds. About 50% of opportunity youth are male, and 50% are female.⁵ When asked about ethnicity, 43% described themselves as white, 27% as African American, 25% as Hispanic, 2% as Asian, and 3% identified as something else.⁶

Opportunity youth face many challenges. These challenges begin early: three in five surveyed grew up in poverty, nearly half were raised by a single parent, and very few grew up in households with a parent who graduated from college. More than half of these young people report looking for full-time work; however, they do not have the skills, prior work experience, or education to qualify for the jobs they seek.⁷ Though motivated to work, these youth continue to face barriers, including the high cost of education, the need to take care of their families, lack of transportation, difficulties balancing school and work priorities, and not knowing how to apply to college or obtain financial aid. These barriers will continue to block their ability to connect with education and employment, unless they receive support.

77% of opportunity youth take personal responsibility for the future success.

72% of opportunity youth are very confident that they will achieve their goals.

Source: Bridgeland and Milano, Opportunity Road, 2011

How do opportunity youth view the future? What do they need?

Despite the barriers that opportunity youth face, they remain optimistic, and want to take ownership of their lives. Nearly three in four believe that they will be able to achieve their goals.⁴ The boys and young men surveyed want to be policemen, lawyers, athletes, or in the military; the girls and young women want to be doctors, nurses, teachers, and lawyers.⁵

But opportunity youth also recognize that they need help and they know they won’t be able to reach these goals alone. They want help from educators who can guide them in their studies. They ask for support from business leaders who can mentor them in the workplace. And recognizing the dual challenge of needing to learn and earn simultaneously to support themselves and their families, nearly eight in ten young people would like jobs that allow them to earn money while attending school and gaining credentials, and seven in ten seek job training and apprenticeships that will give them on-the-job experience.⁸

Opportunity youth are motivated, but they need support

According to Opportunity Road, youth are asking for support in the follow areas:

Soft Skills Training

Life skills classes
Adult mentoring

Work Ready Skills Development

Job Training
Classes that teach the skills needed to keep a job and advance

Learn & Earn Programs

Full-time training and/or GED credit
Job opportunities that allow youth to earn money and attend school at the same time
Apprenticeships

Many businesses assume that the only way to serve opportunity youth is to provide entry level jobs. But when we look at what youth have told us about the type of support they’re seeking, we see there are many ways that a business can engage with youth and help them advance. For example, employees can serve as volunteers, and leverage their experience to mentor or train youth on the skills needed to be successful in the workplace. This can benefit the youth greatly and responds to what opportunity youth have told us they need. These kinds of activities can also benefit the employee and the business: employees who associate their volunteer work with their employer are more loyal and engaged in their jobs.⁹ So there are probably lots of ways to get involved, whether or not your company can offer youth entry level jobs. That’s where this toolkit comes in. It provides a roadmap for any company, no matter the size of the business or the industry, and offers step-by-step instructions on creating a new program for youth or upgrading an existing effort. The toolkit begins with a survey that allows a company to self-assess its resources and readiness. Then, based on the survey findings, it suggests one of three “lanes of engagement” for working with opportunity youth.

Your company can provide support through one of these three lanes of engagement

Lane 1

Soft Skills Development

Provide youth with work-relevant soft skills via course work and/or direct experience

Examples

Soft skills workshops
Employee mentors

Lane 2

Work Ready Skills Development

Provide youth with insight into the world of work to prepare them for employment

Examples

Job shadow days
Career exploration guidance

Lane 3

Learn and Earn Programs

Enable youth to develop on-the-job skills in a learning environment while receiving compensation for work

Examples

Paid internships
Permanent position that provide on-the-job training or allow for continued learning and development

Why should my company get involved?

Businesses are focused on creating value and staying ahead of the competition. They are accountable to shareholders, investors, customers, and employees. So given everything else that keeps you busy, why should you prioritize working with opportunity youth?

We can be very focused on what needs to get done today and the things we believe are core to our current business success. But let’s consider the consequences of not engaging with opportunity youth and the potential impact that it could have to the future health of our business and communities.

As we think about the country’s 6.7 million opportunity youth, we need to remember that they aren’t just potential future employees. They are also our potential future customers. As business people, we know our companies rely on having customers with steady incomes who can purchase our services and products. If a young person is out of school or work for an extended period of time, he or she can’t simply make up for lost time and get back on track. The individual’s lifetime earnings are diminished with each missed year of work at a rate of 2-3% less earnings each year thereafter. Over a lifetime, opportunity youth’s earnings are estimated to be $375,000. That compares to a high school graduate’s average lifetime earnings of $712,000.10 In addition, the aggregate taxpayer burden of all opportunity youth over their lives is $1.6 trillion, and the aggregate social burden is $4.7 trillion.11 The long-term impact on the private sector and the U.S. economy will affect all of us.

Case Study: CVS Caremark

To support the significant growth of CVS Caremark over the past ten years, the company needed a steady source of entry-level talent and a way to develop these employees so that they would be ready for advancement. Since 1996, over 80,000 entry-level workers have been hired who were previously recipients of public assistance. Recent research shows that CVS retail stores retain 60% of employees referred from their regional learning centers (which implement this specialized recruitment and training program) compared to 30% retention among regular employees.

What are the benefits for my company?

The potential implications for the country are significant, but there are very direct implications for your company, too. Many companies today are challenged to find the talent they need, and have stated that this challenge will only increase in the coming years. Opportunity youth are motivated and ready to work. We can begin to build a talent pipeline by equipping opportunity youth with the skills we know are required for workplace success. We can also increase employee loyalty and engagement through employee volunteer and community investment activities, improve shareholder return, and reduce turnover. There are other business benefits represented by this work (see table below), but they share a common theme: opportunity youth can be an asset to your company.

Shareholders

A company's reputation for growth, attracting talent, and integrity can account for much of the 30-70% gap between the book value of most companies and their market capitalizations.¹²
Investors consider environmental, social, and governance performance as a proxy for a company's strong management and a demonstration of a business' ability to identify risks and plan for long-term, strategic growth.¹³

Customers

The students who dropped out of school in 2010 alone will lose over $337 billion in wages, and an equivalent spending power over their lifetimes.¹⁴
85% of consumers have a more positive image of a product of company when it support a cause they care about.¹⁵

Current Employees

Employees who volunteer frequently are more likely to be proud, loyal, and satisfied with their jobs.¹⁶
47% of surveyed executives from multinational companies cite employee satisfaction and decreased turnover as major contributors to long-term shareholder return.¹⁷

Talent Pipeline

Only 40% of employers say they have a strong pipeline of diverse talent.¹⁸
53% of business leaders say their companies face a very or fairly major challenge recruiting non-managerial employees with the skills, training, and education their company needs.¹⁹

Okay, you’ve got my attention. How do I get started?

We hope that as you think about making a positive impact on opportunity youth, weigh the potential business benefits, and consider the national economic implications, you’ll be motivated to take action. But you might not know how to get started. That’s where this toolkit comes in. It was designed to provide step-by-step instructions that introduce companies to options for supporting, training, and employing opportunity youth. It is meant to serve as a roadmap for starting a new effort, or to upgrade an existing program. The toolkit leverages the experiences of other companies that have tackled this work and takes users through four key stages of developing a training or employment program for opportunity youth:

1. Assess & Select

What does my company have to offer?
Assess your company's resources, culture, and readiness for engagement with opportunity youth.
Select one of the three lanes of engagement in which companies can provide youth with skills for employment and adulthood: Soft Skills, Work Ready Skills, of Learn & Earn.

2. Scope

What are my goals and program parameters?
Scope your program. This will help you understand how to apply your company resources to build a successful program.

3. Plan & Pilot

What are the key steps to take to launch a pilot?
Build your plan and create goals and metrics. Try it out with a pilot, get feedback, and understand the impact and the potential business value.

4. Refine & Grow

How will the program continue to develop?
Work to refine the pilot based on participant feedback and build a program for the long-term.

We Want To Hear From You

We hope this toolkit proves useful to you and your company, as you work to create new programs for opportunity youth or build upon existing efforts. This toolkit was created by learning from existing efforts and we can only make these materials better if you share your experiences, lessons learned, and ideas for innovating. We welcome your feedback and comments. Please send your emails to info@opportunitynation.org. We look forward to hearing how your efforts served youth, served your business needs, and served the country.

Footnotes

Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Bridgeland, J. and Milano, J. (2012) Opportunity Road: The Promise and Challenge of America’s Forgotten Youth.
Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Bridgeland, J. and Milano, J. (2012) Opportunity Road: The Promise and Challenge of America’s Forgotten Youth.
Bridgeland, J. and Milano, J. (2012) Opportunity Road: The Promise and Challenge of America’s Forgotten Youth.
Bridgeland, J. and Milano, J. (2012) Opportunity Road: The Promise and Challenge of America’s Forgotten Youth.
Deloitte. (2011). “Executive Summary.” 2011 Volunteer IMPACT Survey.
Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Belfield, C., Levin, H., & Rosen, R. (2012) The Economic Value of Opportunity Youth.
Bloomberg Businessweek (2007). What Price Reputation?
Gitman, L., Chorn, B., & Fargo, B. (2009). ESG in the Mainstream: The Role for Companies and Investors in Environmental, Social and Governance Integration.
Alliance for Excellent Education. (2007). Impact on American Society.
Cone Inc. (2010). Cone Cause Evolution Study.
Deloitte. (2011). “Executive Summary.” 2011 Volunteer IMPACT Survey.
Bruce Pfau and Ira Kay, The Hidden Human Resource: Shareholder Value—Finding The Right Blend of Rewards, Flexibility, and Technology to Manage Your People Adds Measurable Value to the Corporate Bottom Line, 2002
Hewitt Associates, The State of Talent Management: Today’s Challenges and Tomorrow’s Opportunities, 2008
Hewitt Associates, The State of Talent Management: Today’s Challenges and Tomorrow’s Opportunities, 2008