A good step forward.
Road repair photo by torange.us
In his “I Have a Dream” speech, the Reverend Dr. Martin Luther King Jr. lamented the “lonely island of poverty in the midst of a vast ocean of material prosperity.”
As we celebrate Martin Luther King Jr. Day more than 50 years later, islands of inner-city economic deprivation stubbornly remain. The African American male employment rate in American cities has been on a downward spiral since King’s speech. This continuing decline reflects a failure to deal with this problem’s root causes. The tragic consequence is continued and increased human suffering.
Source: “Race and Male Employment in the Wake of the Great Recession”, Prof. Marc Levine, UWM, Jan 2012
Education fundamentally determines employability and income. For those who have already finished schooling, however, we need to pioneer other routes to economic security. “Transitional jobs” are one of the few public programs that effectively increase employment and promote economic mobility.
Transitional jobs are short-term government subsidized jobs. They typically pay minimum wage ($7.25 per hour) and last for six months, or 1,040 hours. The worker has the opportunity to learn work skills, earn a paycheck, and get connected with the labor market. The employer has the opportunity to grow its business and to test a potential employee before committing to a full hire.
Transitional job programs have a proven record. Take Milwaukee, for example, one of the worst performing cities in the country in terms of black employment rates. The graph below shows the rate of attainment of unsubsidized employment by people in Wisconsin’s Transitional Jobs Demonstration Project, which ran from late 2010 through mid 2013 and was funded by temporary Recovery Act dollars. In total, 4,076 people participated in the program and just over half (2,050) went on to secure unsubsidized employment.
Rate of unsubsidized employment by people in Wisconsin’s Transitional Jobs Demonstration Project. Just over half of the participants secured unsubsidized employment.
A rigorous evaluation of the program was funded by Rockefeller Foundation and conducted by Economic Mobility Corporation of New York.
The average annual earnings of the participants the year before entry into a Transitional Job was less than $2,000. In the year after leaving the program, the average annual income increased to $5,296. The participants still lived in highly impoverished households, but the increase is important economic opportunity, through the dignity of work, to some of our poorest communities.
The typical participant was a young African American man who had not worked in the past six months. More than 800 different businesses and organizations provided work for the job-seekers and more than 220 different types of jobs were filled.
Success stories from the project describe people who had been unemployed for months or years or had recently left incarceration, and now have full-time unsubsidized employment after working in a transitional job..
The Wisconsin program also garnered support in the private sector especially for its lack of red tape. According to the Economic Mobility Corporation’s report, which evaluated the Wisconsin program alongside five other similar programs from across the country:
Most employers created jobs that would not have existed otherwise. Sixty-three percent of employers across the states we examined said they generated jobs that would not have existed otherwise in order to employ the subsidized workers, suggesting that subsidized employment programs can help stimulate business growth. Employers also saw benefits to their bottom line and were eager to participate in similar subsidized employment programs in the future.
Wisconsin currently spends $6.5 million per year on Transitional Jobs; $5 million in the Transform Milwaukee Jobs Program with the rest committed to expanding Transitional Jobs to other high poverty areas of the state. However, Wisconsin has been penny wise and pound foolish with taxpayer dollars overall. The state spends more than $1.3 billion per year on the Department of Corrections. Tax cuts over the past couple of state budgets have disproportionately benefited the wealthy. Even a small part of the money currently spent on Corrections or distributed in tax cuts could create tremendous economic opportunity for discouraged workers in Milwaukee and Wisconsin’s other cities, towns and rural areas.
There are twenty active organizations in the Milwaukee Transitional Jobs Collaborative, working to find more money to be invested in a statewide Transitional Jobs program.
Efforts like these to keep Wisconsin’s transitional job program alive, as well as creating similar programs in other states would help to realize some of the hopes, aspirations, and dreams expressed by Dr. King and others in the 1963 March on Washington for Jobs and Freedom.
Conor Williams is the Economic Policy Analyst for the Working Our Way Out of Poverty Project. He is also active in Milwaukee Inner-city Congregations Allied for Hope, which offers an alternative to criminalization and incarceration through supervised community treatment programs.