Nonprofit training providers too often are seen as charities by corporate partners, says a workforce education veteran, who’s back with a startup he hopes will instead be viewed as a business partner with a scalable solution. Also, Work Shift’s 2022 highlights.
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A weekly newsletter about the intersection of education and work. By Paul Fain
The Bottom Line
The tight labor market has created more opportunity for workforce education programs that seek to open doors for lower-income Americans without college degrees. But unless employers see these on-ramps as a solution to a business problem, they tend to remain boutique experiments.
Sean Segal became well acquainted with this conundrum during his five-year stint as CEO of Generation USA, a nonprofit that offers free bootcamp-style instruction and career support to learners without degrees. Segal’s team spent lots of time developing materials to demonstrate the ROI for employers to hire their graduates.
“Without fail, when we’d present these materials to a CEO, HR lead, or hiring manager, they’d nod and immediately send us to corporate social responsibility,” he says. “We were viewed as a charity, not a business solution.”
Generation USA’s corporate partners include Verizon, which two years ago announced $44M in spending on free tech-focused training. The group’s relationship with Verizon is part of its ambitious goal to train 500K learners by 2030.
Yet even with Verizon’s substantial investment, convincing its various divisions to hire Generation USA’s graduates remained a work in progress when I checked in on the program last year.
To truly drive systems change, argues Segal, who left Generation USA early this year, workforce education providers need to meet businesses on a level playing field. He says it’s hard to do that as a nonprofit.
“They need to see us as not only a solution to one of their largest problems—one that directly impacts their bottom line—but also as a business partner with aligned economic sustainability and profit motivations,” he says.
Real change means retraining hundreds of thousands of workers each year, say Segal and Sienna Daniel, who was Generation USA’s chief growth and impact officer. And it’s difficult for a nonprofit to raise the capital needed to serve large numbers of students.
“We need to do that in a sustainable way, not begging for philanthropic dollars each year,” Segal says.
A ‘Business Imperative’
Segal and Daniel are thinking big with their new startup, Escalate. The for-profit they co-founded is focused on frontline workers and is seeking to be a retention and equity solution for corporate partners.
Escalate’s approach is designed to tap the education benefits offered by a growing number of companies. It will provide weekly, asynchronous online training for industry-recognized certifications and jobs with better wages and upsides.
A wide range of experts point to the need for more workforce education and training options for incumbent workers.
Segal says an estimated 50M Americans are in dead-end, low-wage jobs. They leave these roles in an average of just 90 days. Most quit because they need upward mobility. Yet employers spend heavily on recruitment and training to cope with the rapid turnover—and still face a talent deficit of middle-skill roles with starting salaries of $50K to $60K.
The solution is to “rebuild the internal pathways that used to exist in corporations,” says Segal. “We’re going to show this is not only possible, but it is also a business imperative for survival in the new labor market.”
The company offers eight to 10 hours per week of free, cohort-based online training to frontline employees, particularly those who work 32 hours per week or fewer. After completing a year of training, employees earn an industry-recognized certificate. They also are promoted to a second year of training, which is structured as full-time, apprenticeship-style IT job placement, with both on-the-job training and cohort-based online education.
Escalate recently was tapped by Techstars, an investment firm focused on early-stage companies, to be in the third cohort of its Workforce Development Accelerator Program. (Click here to read a Q&A in Work Shift with Taylor McLemore, managing director of the Techstars accelerator.)
Segal says Escalate is in advanced discussions with a company that has roughly 90K frontline workers. To be a real solution, the company says Escalate needs to be able to train 30K of those employees each year.
The Kicker: “We’re building to train hundreds of thousands of people each year,” Segal says, “because that is what is needed.”
Click over to Work Shift to read the full exchange with Segal.
Wrapping Up 2022
This is The Job’s last edition for 2022. The weekly newsletter will be back next year—at least that’s my plan.
A one-person reporting operation has its limits. As a result, I’ve leaned heavily on coverage from Work Shift, the newsletter’s partner publication, to add depth and breadth to The Job.
Likewise, the sophisticated reporting Work Shift publishes from experienced journalists like Margaret Moffett, Lilah Burke, Kathryn Masterson, Elin Johnson, and Elyse Ashburn, Work Shift’s editor, feature details and sourcing that aren’t possible in the tight real estate of a weekly newsletter.
See below for some of our favorite Work Shift pieces from 2022. And make sure you take time to get to the Open Tabs at the end of this edition.
We would like to bring you even more of this coverage next year. But that requires funding we currently don’t have. Let me know if you have any ideas for supporting our journalism? And click here for information on advertising and how to get in front of decision-makers in the expanding workforce education and training space.
Thanks for reading, and happy holidays. —Paul Fain
New pathways in tech — workshift.opencampusmedia.org
In this explainer series, we make sense of the fast-moving world of education and training for tech careers—from evolving degree programs to fast-growing apprenticeships. We look at what’s happening, who’s paying, and who benefits.
The workforce is changing. Can community colleges change with it? — workshift.opencampusmedia.org
Advocates and researchers in education are asking if two-year institutions might transform to reach a fuller potential—serving as community hubs for social and economic mobility.
Can campus connections drive economic mobility? Yes, but not by doing the ‘same old’ — workshift.opencampusmedia.org
Going to college isn’t an automatic ticket to a stronger network, writes Julia Freeland Fisher, author of Who You Know. Institutions have to design for it.
Texas is poised to tie community college funding to ‘value’ and jobs — workshift.opencampusmedia.org
The state’s community colleges have been starved for resources. A new proposal would boost state funding by $650M—and tie much of it to economic outcomes.
Why a ‘college and’ approach is necessary to rebuild the middle class — workshift.opencampusmedia.org
College can’t be the only path to the middle class, writes Kate Naranjo of Opportunity@Work. And we’ve neglected to invest in other routes for far too long.
Low pay in ‘helping’ professions creates a moral dilemma for colleges — workshift.opencampusmedia.org
The pandemic and mounting concerns about equity have colleges questioning whether they can continue to offer certain credentials in low-paying caregiving fields.
With Google’s latest push, a blending of industry and higher ed — workshift.opencampusmedia.org
Google’s new industry specializations were co-built by its experts and faculty at four top universities—part of a larger push to combine forces with higher education to drive economic mobility.
In debate over short-term Pell, we can’t ignore the labor market’s role — workshift.opencampusmedia.org
Labeling education programs that lead to low-wage jobs “low-quality” obscures the true problem—a labor market failure, writes Michelle Van Noy, director of the Education and Employment Research Center at Rutgers.
Understanding new-collar apprenticeships — workshift.opencampusmedia.org
Long a pathway into the trades, apprenticeships now are also preparing Americans for new-collar jobs in fields from healthcare to tech.
Cautious optimism about workforce education after the midterm elections — workshift.opencampusmedia.org
Advocates at both the state and federal levels hope to see continued momentum on efforts to create more high-quality education and job-training options for low-income Americans.
Community college leaders were significantly more likely than employers to say collaboration between their sectors was extremely important, according to survey data in a new report from Harvard Business School’s Project on Managing the Future of Work and the American Association of Community Colleges. Employers also do not view community colleges as the most efficient or effective way to acquire middle-skills talent.
New America partnered with 12 community colleges for research on what goes into quality nondegree program design and recently released two briefs in a three-part series on the project. The group conducted site visits at each college to understand what works and what doesn’t with nondegree tracks. The brief series is designed to help community college leaders better plan, deliver, and improve high-quality programs.
Demand is growing rapidly for four skills—artificial intelligence/machine learning, cloud computing, product management, and social media—with one in eight job listings now requiring one of those skill sets, according to a report from the Burning Glass Institute, the Business-Higher Education Forum, and Wiley. Those skills pay off in the labor market, but most jobs requesting them also require a college degree.
Part-time job openings for early talent have declined in recent months, with a 32% year-over-year decrease in part-time job postings on Handshake. Retail has led the way, the company reported, with a 51% decline in part-time postings in October and November. That dip tops the 39% drop-off of part-time jobs in the tech industry. As a result, college students may have less opportunity to gain valuable skills for the workforce.
A new career-readiness program from the Illinois Institute of Technology, which features hands-on experience and personalized mentorship, contributed to a 25% spike in undergraduate enrollment this semester. Illinois Tech is offering graduate coursework or upskilling options to graduates who complete the Elevate program. Preparation for career opportunities is the most-cited reason students enroll at Illinois Tech.
A new $20M workforce program from the National Science Foundation seeks to help community colleges, HBCUs, and minority-serving institutions expand career opportunities for students, New America’s Shalin Jyotishi writes in Forbes. The funding is for colleges to develop partnerships for training that leads to jobs in emerging technology fields such as AI, quantum computing, nanotechnology, and clean energy.
Just 37 percent of employers plan to use college students’ GPAs to screen for jobs—down from 73 percent four years ago, according to a report by the National Association of Colleges and Employers. Instead, employers are focusing more on evidence of skills like problem-solving and teamwork. NACE also found that they have increased their recruiting budgets by more than 51% in the past year.