Remove Barriers to Work and Build Pathways Back to Employment 

Use the Right Credentials to Better Align Applicant Abilities and Employer Needs

In order to produce better workforce outcomes for low-income and disadvantaged populations, skills training and credentialing needs to be better aligned with business and industry demand. This requires, however, that employers are able to signal effectively and clearly what their demand is and who they source talent from. In order to understand employer demand, a wide variety of public-private partnerships have promoted employer engagement strategies that include reviewing and validating labor market information provided by the state or federal government, or real-time labor market information vendors. However, these employer engagement strategies have consistently come up short in being able to stay on top of changing and shifting employer demand in a dynamic economy.

Achieving better alignment of education and workforce systems with in-demand jobs and industries will require that employers more effectively signal their changing talent demands to education and workforce partners. Better alignment requires first that employers better organize themselves and their demand in ways that produce consistent and scalable signaling of employers’ workforce needs and priorities. More than an employer engagement challenge, the business community must play a lead role in (1) organizing new employer collaboratives that are by business, for business and are designed to manage performance-based talent supply chains for their most critical jobs; (2) signaling the competencies and credentials that are in demand in today’s workforce; and (3) recognizing or endorsing preferred and trusted education and workforce providers that are best able to meet their workforce needs, perhaps through sector partnerships.
For example, the U.S. Chamber of Commerce Foundation (USCCF) recently launched the Talent Pipeline Management (TPM) movement as a way to reboot and reinvent employer leadership in education and workforce systems and most recently launched the TPM Academy as a train-the-trainer program designed to build capacity and provide technical assistance to organizations that are convening employers around workforce challenges. In addition, USCCF is launching a new “job registry service” that will help employers signal dynamic, linked, and structured competency and credentialing language around their hiring requirements in ways that are interoperable with learner record and credentialing systems. Lastly, in addition to transforming how employers communicate workforce priorities and demand, they can also signal where they source talent from. This can be done in ways that build off the Manufacturing Institute’s M-List, which identifies those training providers that meet the manufacturing community’s workforce training needs.

One example of an emerging model is TechHire, a national network of communities working to create pathways for overlooked and underrepresented Americans to gain skills and access to open technical jobs across the country. Community leaders in these TechHire communities across the country - including local workforce boards, employers, educators, community-based organizations, and civic leaders -- have joined hands to create access to tech training and employment within their cities, states, and rural regions. Community partners across the nation provide vital employer feedback to training providers teaching overlooked job seekers in-demand technical skills. TechHire employer partners are committed to giving individuals a chance to show what they can do by using targeted assessments rather than traditional applicant scanning that often relies only on resumes.

Establish a Jobseeker’s Allowance

Two-thirds of Americans will experience at least one year of unemployment either themselves or indirectly through their household head during their working years. Yet, only about one in four unemployed workers receives unemployment insurance (UI) to support them in their search for a new job. While we have different opinions on strengthening and expanding unemployment insurance to cover more workers, we are in agreement that the adoption of a “Jobseeker’s Allowance” (JSA) would be an appropriate strategy to fill in the gaps for workers who do not qualify for UI. In response, we recommend adoption of a “Jobseeker’s Allowance” (JSA).

The Jobseeker’s Allowance is a small, short-term weekly allowance to support work search and preparation. The JSA would be a parallel and complementary program to UI but would differ in terms of the populations it serves, the benefits and services it provides, the criteria required for eligibility, and its administration and financing. The JSA would offer a stipend of about $170 per week to jobseekers for up to 13 weeks, replacing approximately 50% of the wages of a typical low-paid worker. While JSA’s weekly benefit would be quite modest relative to UI—and its job-search requirements at least as stringent as UI—the JSA would encourage workforce participation, support geographic labor mobility, and promote family stability and social cohesion. It would also be an important countercyclical tool during economic downturns.

The JSA would provide an incentive and support for individuals with limited or no recent work history to reconnect with or newly attach to the labor force. Supports would include counseling, employer referrals, and training and education opportunities. All JSA applicants would be screened upon application to determine individualized placement into one of two program pathways for meeting the employment-related requirements: job search and career ladders or individualized mobility strategies. The majority of placements would likely be in Path One, which includes job search supports and connections to career- specific training and education opportunities. 

A smaller subset of individuals facing significant barriers to work, including but not limited to those experiencing homelessness, people with disabilities requiring services, and survivors of domestic violence would be routed to Path Two: Individualized Mobility Strategies. In this path, the 13 weeks of JSA benefits would provide the option of engagement with a program navigator to connect the participant with appropriate wraparound services, such as mental or behavioral health services, which would be available to jobseekers. This is beyond the work supports provided under path one – such as child care and transportation assistance. Because this population may need more time to secure employment, they would be eligible for a longer duration of benefits, and work with a navigator to develop an individualized plan to overcome the participants’ barriers to employment and prepare them for work in the medium- to long-term. In both paths, participants would have access to legal help with services such as expungement or pardon of a criminal record or conviction, improving credit reports, and other needed legal services to help remove barriers to employment.

Remove Barriers to Employment for Formerly Incarcerated Individuals

A staggering 70 million to 100 million Americans — one in three American adults—now have some type of criminal record. Having even a minor record, such as a misdemeanor or even an arrest that never led to conviction, can be a lifetime sentence to poverty. Criminal records stand in the way of nearly every building block of economic security and mobility—most notably, gainful employment.

Given that many individuals with more severe criminal histories often come from communities lacking in access to opportunity with fewer socioeconomic resources, a criminal record further exacerbates the problem. These obstacles are even more pronounced for people of color who face discrimination within and outside of the criminal justice system.

Each year approximately 650,000 people return home from incarceration and more than 95% of the 2.1 million people currently incarcerated today will return home during their lifetime. However, research from the Bureau of Justice Statistics shows that nearly two thirds of these individuals will be rearrested within three years of their release. Gainful employment, safe and stable housing, and skill-building through education and training are proven to greatly shrink recidivism and put people with records on the path to successful reentry.

Therefore, in order for the U.S. to address its mass incarceration crisis and put second chances within reach—as well as dramatically reduce poverty and expand opportunity—policymakers should: (1) remove employment barriers for people with criminal records and (2) increase workforce development and skills training resources for formerly incarcerated individuals and people with records.

Removing Barriers to Employment for Jobseekers with Records

While access to criminal records was unusual a generation ago, today background checks have become a near-standard part of the hiring process. Today, an estimated 87% of employers conduct criminal background checks on their applicants. Surveys of employers confirm that a criminal record is a powerful hiring disincentive. Jobseekers currently on probation or parole are the most likely to be excluded from consideration. And most employers report unwillingness to hire anyone who has served prison time. As a result, some 60% of formerly incarcerated individuals remain unemployed one year after release—and for those who do find steady work, an incarceration record can greatly diminish earning potential. By age 48, average lifetime earnings for formerly incarcerated men are $179,000 less than for non-incarcerated men. 

Importantly, while more serious records as well as prior incarceration can pose special employment barriers, employer survey research also confirms that no criminal record is too old or too minor to stand in the way of a jobseeker’s consideration—including misdemeanors and arrests that never led to conviction.

We recommend:
  • "Clean Slate” (Automatic Record Sealing) : Fair chance hiring (often called “ban the box”)—based on the 2012 Equal Employment Opportunity Commission (EEOC) guidance on employer consideration of criminal records—has been shown to boost hiring of qualified jobseekers with records, particularly in the public sector. But the most powerful strategy to reduce barriers to employment for these shutout workers is to enable them to clear their record through expungement or sealing.

    With social science research on “redemption” documenting that once an individual with a prior nonviolent conviction has stayed crime free for three to four years, that person’s risk of recidivism is no different from the risk of arrest for the general population, there is growing bipartisan agreement that it makes no sense to treat people as “criminals” long past when they pose any meaningful risk of committing new crimes.

    States should follow emerging bipartisan models that would enable people with qualifying minor records to earn a “clean slate” (have their record automatically sealed) once they have remained crime-free for a certain period of time. This new strategy is particularly important to help people unable to afford a lawyer—or unable to secure scarce free legal help—clear qualifying records; currently a great many are unable to access expungement/sealing remedies due to lack of legal help. 
  • Occupational Licensing Reform: Today, nearly 1 in 4 U.S. workers requires a government license or certificate as a condition of working in their chosen field. Yet more than 40,000 types of licensing bans across all 50 states erect unnecessary and often unjust barriers to employment, putting jobs in the nation’s fastest growing occupations and industries, including healthcare and transportation, out of reach entirely for people with records. Importantly, many of these sectors currently face skilled worker shortages that would be lessened by such reforms. Bipartisan momentum is growing in support of common-sense reform of occupational licensing laws and regulations with reforms now taking hold in states as diverse as Georgia, Illinois, Kansas, and Texas. 

Use Creative Subsidized Employment Models

For many jobseekers, including youth, those needing various types of assistance, and those described above seeking jobs after a period of incarceration, there is a risk that a job may not work out due to various obstacles, such as lack of child care, transportation, and/or work experience. A proven tool to address this reality and to share the risk with employers is subsidized/trial employment agreements, developed between employers and workforce agencies and/or their contractors. The goal is to underwrite all or part of the wage for an agreed upon period of time (varying between 3-9 months) and with clear expectations that the employer, based on evaluation of the worker, will convert the job to an unsubsidized position. Keeping the subsidy period short and including reasonable expectations discourages employers from using the subsidy as a revolving door of free labor, especially when they would have otherwise made the hire.

The subsidy can come from several sources of funds used singularly or in tandem such as a grant diversion or a subsidy through public funds that have been appropriated specifically to operate a wage subsidy program. Members of our stakeholder group hold varying views on the appropriate funding source with some open to grant diversion and others opposed.

This simple construct, however, poses risks to employers. Employees hired under a subsidized employment agreement often have less job experience and familiarity with workplace expectations than other potential employees. Therefore, subsidizing their wage becomes an equalizer in the hiring process, and the risk to the employer is being underwritten as their skills and adaptation to the job are measured.

Benefit to the Client and Employer: The benefits to the client are numerous. They are in the workplace gaining experience and being paid through a regular payroll check, and they gain specific skills related to the occupation. If the employer offers benefits to its non-subsidized employees, the client can receive the same or similar benefits financed by the wage subsidy. The subsidy allows the employer a trial period to evaluate the individual, whom they might not otherwise have hired, prior to deciding whether to retain them on an unsubsidized basis.

Relationships Are Crucial: Critical to success is a strong and trust-based relationship between agencies that administer subsidized work programs and employers, a clear understanding of the employers’ precise needs, and a job development component that can best match clients to specific jobs. Agencies can also maximize other subsidies to employers by helping them gain easy access to applicable Work Opportunity Tax Credits, and by making sure employees have access to available low-income tax credits, like the EITC.

Proven Results: A study of five TECF (TANF Emergency Contingency Fund) subsidized jobs programs (in Florida, Mississippi, Wisconsin, Los Angeles, and San Francisco), done by the Economic Mobility Corporation (EMC), demonstrates the clear successes of helping disadvantaged individuals increase their incomes during hard economic times, as well as improve their chances of finding permanent employment when the subsidy expired. The EMC report notes that, “while the goals and structures of the TANF Emergency Fund-Supported Subsidized Employment programs varied by jurisdiction, they generally sought to create job opportunities for unemployed individuals so that they could earn immediate income and build experience and skills. Many programs also sought to reduce the costs and risks to employers of hiring during a slack economy and to stimulate local economies.”

Additionally, EMC’s report stated that:
  • Participation in subsidized employment programs led to increases in employment and earnings.
  • The programs were especially effective for the long-term unemployed.
  • Employers reported hiring more workers than they would have otherwise, and workers with less experience than their usual hires.
  • Most participating employers reported multiple benefits from the program, including expanding their workforces, serving more customers, and improving their productivity.
  • The majority of jobs created would not have otherwise existed.

Key barriers addressed by this approach:
  • Unemployment remains high for many disadvantaged and displaced groups who have simply left the workforce. While the national unemployment rate has declined significantly, the jobless rate is much higher for teenagers, individuals with criminal records, workers without any postsecondary education, African-Americans, and other groups that have difficulty finding jobs even when economic conditions are good.
  • Transitional Jobs programs targeting people recently released from prison can reduce recidivism. These programs can also reduce welfare dependence and increase payment of child support by non-custodial parents.
  • While earlier subsidized employment programs focused on public sector employment, recent subsidized employment programs have sought to place participants in jobs in the private sector, potentially fertile ground for future success.

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