Impact Hiring Strategies To Bridge The Employment Gap

How companies can employ the untapped talent pool of “opportunity youth”-

As HR professionals are keenly aware, many U.S. employers are contending with a vast number of job openings that they are unable to fill. According to recent U.S. Department of Labor statistics, there are currently 7.2 million open jobs across the US, while the unemployment rate hovers at or near historic lows. The result is an employment gap that continues to challenge businesses of all sizes and sectors. Some cities and states have even turned into “worker deserts” where companies cannot find enough people to hire and are unable to keep up with growth unless they find more employees.
 

At the same time, there is a significant segment of the population that is unemployed or underemployed.  “Opportunity youth,” an often-overlooked group of young people between the ages of 16 and 24 who are neither in school nor working, represents a potential talent pool of a staggering 6.7 million workers. 

The unemployment rate for young workers remains more than double the national average, leading to a lifetime of lower earnings and instability for those that do not connect to work. The data illustrates that racial equity gaps persist as well, with an unemployment rate for black Americans nearly double that of others. Connecting opportunity youth and other underrepresented groups to the workforce is necessary for the betterment of individuals, families, and communities—as well as business growth and the overall health of the economy.

Impact Hiring: Connecting Opportunity Youth with Employers

To connect opportunity youth with employment, the sector must address barriers for both employers and the youth themselves. In that spirit, the Rockefeller Foundation and its grantees have collaborated on an impact hiring initiative to address entry-level challenges for employers, while also helping opportunity youth overcome barriers and achieve stable employment.

Impact hiring utilizes demand-side strategies that provide greater opportunities to poor or vulnerable youth and other marginalized populations to access entry level employment. It engages technologies to help employers identify promising talent from a larger pool than they traditionally consider—and to make hiring policies and decisions based on data rather than intuition. 

For example, predictive talent analytics match youth with opportunities based on potential, allowing job seekers to find positions that often reveal their talents, despite not having traditional experience that shows on resumes. At the same time, employers use the analytics to identify job seekers who would not normally be considered but that are best suited to succeed in open roles. This interchange removes many barriers that prevent opportunity youth from joining the workforce, while opening up a vast new talent market for employers.

Impact Hiring Tools and Strategies

As an HR professional, you know that recruiting, onboarding, and training contribute to nearly 40% of the total cost-per-hire for entry level talent.  Turnover and related loss of productivity often accounts for an additional 50% of the total cost-per-hire. Clearly, there is a strong bottom line incentive to evaluate and improve the hiring process. However, these high costs also make companies risk averse to working with alternative populations. That’s why it is so important to recognize that, while still in the early stages, pilot programs around the country based on impact hiring principles are already demonstrating notable ROI for employers.

Our organization, Generation USA, is a workforce development nonprofit with programs in 14 U.S. cities, dedicated to recruiting, training, and placing opportunity youth in career-launching jobs.  We recently partnered with the Rockefeller Foundation to develop a free ROI Estimator tool that helps employers define and evaluate hiring costs, so they can define pain points and take steps to make the process more efficient. We see across the board cost savings when companies partner with Generation, driven by a high successful placement rate (over 80%) and data showing that 76% of our placements are still in their jobs one year after hire.

Another useful tool that demonstrates success is the Opportunity Navigator, a collaboration of Talent ReWire and Grads of Life. This tool helps employers and HR managers understand and utilize proven best practices, including strategic investments that build diverse entry-level and frontline talent pipelines, support retention and productivity, and often lead to improved morale and performance. 

Here are some ways that you can help your company take advantage of impact hiring methods to expand your potential pool of employees, while strengthening your business:

● Research and gain awareness of the benefits of tapping into the opportunity youth labor force.
● Partner with a nonprofit organization that is committed to serving opportunity youth and applies the principles of impact hiring.
● Use technology and tools to analyze the costs of hiring and training new employees.
●  Gather data on your specific pain points in hiring and employee retention.
● Use the data that you gather to develop a customized, defined series of interventions that will enable you to overcome hiring and retention roadblocks. ● Determine how you will measure progress, track ROI, and define success your efforts.
● Stay the course and fully engage your selected tools and interventions, but be ready to adapt methods as progress is tracked.

Many of these strategies can also elevate your community and the local economy. By engaging in this approach or partnering with an organization such asours, you will be well positioned to bridge the employment gap and build a more sustainable pipeline of employees with a stronger and more inclusive workforce. 

Author Bio

Sean Segal is Chief Operating Officer for Generation USA. In this role, he oversees programs across 12 cities serving more than 2,000 participants in four sectors: technology, healthcare, skilled trades, and customer service.  Visit usa.generation.org