Special to the Philanthropy Journal
By Abigail Carlton, Willa Seldon, and Vikki Tam
Try this thought experiment: what would happen if all the workers under age 25 suddenly vanished?
“Without youth, our stores would close,” said one larger employer we spoke to, expressing the views of many firms which rely heavily on young workers to fill entry-level jobs. “We wouldn’t be able to keep up with the times technologically, or with social media. Youth keep us current and keep us connected to the public.”
Youth employment, defined as workers under age 25, is a critical social issue for philanthropists and others seeking to break the cycle of poverty, and it is a critical business issue for sectors of the economy that rely heavily on entry-level workers. And the demand for entry-level workers will only grow. Over the decade between 2012 and 2022, according to Bureau of Labor Statistics data, more than 5.6 million low-skilled entry-level jobs are expected to be created—the kind that have typically been well suited to younger workers.
A survey of 350 CEOs, HR and line executives from large U.S. employers conducted by Penn Schoen Berland, part of a larger study supported by The Rockefeller Foundation, found strong support for hiring youth. Among the large companies surveyed, entry-level positions make up 38 percent of their workforce. Over 80 percent of the executives were favorable to hiring youth, even those youth without a college degree.
Despite executive interest, there are also real challenges to hiring and retaining young workers. More than 80 interviews of corporate leaders, workforce practitioners and experts by Bain & Company and The Bridgespan Group surfaced both why it’s so hard and what a few companies are doing to overcome these challenges. Among the reasons cited in interviews were: filling a large number of entry level positions now; supporting a shift to a tech-intensive strategy; and strengthening the current and future customer base by engaging younger customers.
While many companies—especially those in industries like retail, food service, and healthcare—need and value youth as entry-level employees, the business leaders we surveyed and interviewed also cited significant challenges: (1) difficulty finding the right match for the position; (2) soft skills and professional behavior (showing up on time, dressing appropriately, knowing how to work as part of a team, and interacting in a professional manner with customers); (3) job-specific skills; and (4) turnover.
So is there a role for philanthropy?
First, employers should look for company-wide solutions: The business leaders we surveyed highlighted gaps in their own companies’ entry-level hiring practices around training and mentoring new hires on both technical and “soft” skills around professionalism. Youth may be unnecessarily screened out of the hiring pool by interview and other processes, and company culture may be making it hard for youth to fit into the workforce. Consider how CVS Caremark, the country’s largest pharmacy network, is addressing the challenge. It hires 20,000–25,000 young people per year across a wide spectrum of positions (including clerks, pharmacy technicians, and warehouse jobs). It develops youth employment models, then spreads best practices across business units so efforts are broader than just a single worthy program. Through the use of “tryout dollars”, it encourages store managers to adopt successful youth hiring programs, centrally funding youth hiring payroll expenses for a trial period while local managers determine candidate fit.
Second, look for value chain opportunities: Starbucks, for example, is engaging its suppliers in increasing youth hiring through its LeadersUp initiative, started in 2013. LeadersUp, a nonprofit, plays multiple supportive roles: identifying barriers to youth employment across the supply chain, designing employer-led interventions (training, on the job mentoring, and organization redesign to create career pathways for opportunity youth), engaging government workforce development resources and measuring the return on investment of youth hiring activities. In short, it’s working to create a talent pipeline from warehouse to stores.
Third, companies, nonprofits and education institutions should look for opportunities to collaborate on boosting youth employment, especially for vulnerable young people for whom getting and keeping that first job is so important.
And here, philanthropy can play an important role—looking beyond small-scale or one-off efforts to support the kind of nonprofit/employer collaborations that can both help young people find jobs and bring real, tangible value to employers. As employers look to fill millions of jobs over the next few years, there are compelling business reasons for considering youth as a valuable source of talent. To address the challenges of youth employment, more efforts need to aim for scalable solutions that focus on employer needs.