Noha Kikhia, associate principal of the Redstone Strategy Group, talks about economic mobility within philanthropy, finding viable opportunities in the space and how family philanthropists can evaluate their own impact.
What is the field of economic mobility in the context of philanthropy, and what are the main priorities of organizations working in the space?
The field of economic mobility focuses on building financial security and opportunity to enable people of all backgrounds to thrive. Research suggests only half of children grow up to earn more than their parents, a measure that has been in decline for the past 50 years. Philanthropists and community-based organizations have deployed diverse strategies to increase economic mobility for more Americans by building opportunity and addressing the major challenges that keep people in poverty. Some common approaches include:
- Building more robust career pathways through improvements in workforce development training, apprenticeships and work-based learning. These solutions help ensure equitable access to skills development so individuals can find jobs that are growing in our current and future economy.
- Improving job quality through investments in employer training, equity-focused procurement practices and changes in investment approaches to incentivize improved employer practices. These solutions help ensure that available jobs are high-quality and provide a living wage. This is crucial to building upward mobility for all workers.
- Supporting individuals and families to achieve financial security through improved access to safety-net benefits and wealth-building opportunities. These solutions help individuals achieve stability, which is a foundation to upward mobility.
What have been some of the greatest challenges in creating pathways to economic mobility and opportunity?
Several challenges have created barriers to economic mobility and opportunities for diverse populations. First, the rise in income inequality and wage stagnation has made it more challenging for people to earn a sufficient income to meet basic needs. Second, we need to transform U.S. education and workforce systems to ensure they are adequately preparing individuals for jobs that will facilitate equitable advancement for all. Finally, systemic racism within the workforce field’s practices, policies and programs often create disparities in workforce outcomes that lead to barriers in economic mobility.
The team at Opportunity Insights has conducted research for many years to identify barriers to economic opportunity and develop solutions. You can read more in their research about how investments in education, neighborhoods and focal populations can address these challenges.
What are some of the most promising interventions or solutions that family and individual philanthropists are well-positioned to support?
Family and individual philanthropists are well-positioned to invest in solutions that bring together business, policy and philanthropy to address these barriers. Promising approaches include investing in place-based solutions that build community and build upon the expertise of those most impacted. Donors can also invest in innovative pilot programs that are seeking traction before they grow, which often requires funding from philanthropy.
Gary Community Investments is an example of a family office that is deploying a place-based approach to support financial security and mobility for kids and families from low-income backgrounds and BIPOC [Black, Indigenous and people of color] communities in the metro Denver area. Their investments in higher education pathways, job training programs and solutions to facilitate access to public benefits have supported hundreds of families. Their place-based approach allows for authentic relationship-building with on-the-ground stakeholders.
Can you share one or two examples of recent successes in the field?
During the COVID-19 pandemic, we saw a significant number of families and individuals investing in economic mobility efforts, and a number of nonprofits stepped up their work in this area. The Families and Workers Fund helped provide emergency cash relief to 215,000 front-line workers in 2020 and has expanded its funder collaborative to invest in improved job pathways and 21st century benefits.
Opportunity @ Work (O@W) is another organization that is supporting individuals to access high-quality jobs. It’s working specifically with people who have gained their skills and expertise in ways other than via a college education. This population is known in the field as STARs: people who are skilled through alternate routes. It’s a large group — 50% of all workers in the United States are STARs, including 62% of Black workers and 54% of Hispanic workers. O@W has created technology tools to connect employers to STARs to build stronger skills-based pathways in industries such as technology, consulting and more.
What are the considerations that donors and their advisers should keep in mind when designing a grantmaking portfolio in this field and measuring impact?
Investments in economic mobility are a smart decision. The primary considerations donors and advisers should keep in mind is what specific population they are hoping to serve and what the barriers are that those populations experience. Do they need support upskilling or reskilling in response to the changes in the local labor market? Do they need support exploring and implementing employee ownership models as an approach to wealth-building? Specific focal populations like youth or previously incarcerated individuals face unique challenges with a set of solutions and bright spots to leverage.
Investments in economic mobility can bring the American dream back to life. Donors have the opportunity to participate in a once-in-a-generation opportunity to improve the economic mobility and prosperity of all Americans. Join the movement.