Accelerating Economic Mobility: Career Impact Bonds for Workforce Training

5/17/2021

Ashley Putnam: Thank you for joining us for our fifth and final episode of Workforce Realigned, a special five-episode podcast series within Economy Matters that explores how innovative finance is reshaping the future of work. Workforce Realigned is a production of the Federal Reserve Banks of Atlanta and PhiladelphiaOff-site link in partnership with Social FinanceOff-site link. My name is Ashley Putnam. I direct the economic growth and mobility project at the Philadelphia Fed, and it's been a pleasure to be your host.

Today, we're really excited to wrap up this series with an incredibly important conversation, which is really about financing the future of training for workers. We've talked a lot about the economic case for this work, about the importance of doing good and doing well, and how some people in government and higher education are innovating for the future of work. Today, we get to hear from a really exciting example of what it looks like to put that innovation into action for workers of all education levels.

I'm excited to welcome Lisa Lewin, who is the CEO of General Assembly, as well as Tim Spurlock, the CEO and founder of the American Diesel Training Centers. And they'll be joined today by a wonderful thought leader and partner in this work who has been an advocate for thinking about social impact, Tracy Palandjian, the chief executive officer and co-founder of Social Finance.

Tracy, I'd like to start the conversation with you. Social Finance has really dived into this work thinking about how to fund worker training and worker education in more innovative ways. I'm wondering what motivated that. What have you seen when you look across workers and employers and geographies about the current state of our worker training programs? What motivated you to be working in this space?

Tracy Palandjian: Thank you so much, Ashley. It's wonderful to be with you. We've been at this for quite some time now. In fact, we started thinking about our role in helping finance worker education and training before the pandemic. And as we all sit here now in April of 2021, even coming out of the pandemic, there's still some amazing job opportunities out there, millions of them. Job openings in healthcare and green energy, in the skilled trades. Even sitting right now, I think we're almost at prepandemic levels in terms of the unfilled job openings out there. I think Q2 last year in 2020, we saw the greatest dip. I think we lost around two and a half million of those job openings in the marketplace, but we're almost back to prepandemic levels at around seven million job openings on the books.

Many of them were actually good jobs that pay middle-class wages. These middle-skills jobs are roles that require more than a high school diploma, but less than a bachelor's degree and require some training beyond high school. These are all jobs with great pathways to economic mobility. Sitting here in the U.S., that's around millions of jobs. We have 90 million working-age adults with no credentials beyond a high school diploma. This idea of these middle-skills roles that remain unfilled, and the skills gap that we've been talking a lot about as a country remain prominent, even in the pandemic.

Just a couple of numbers, Ashley: 52 percent of the American labor force jobs are these middle-skills jobs, but only 43 percent of the folks in our labor force are qualified to fill them. That speaks to the massive skills gap that separates a good portion of talented folks in the marketplace from these truly good jobs with great potential for advancement. You talk about what is contributing to the skills gap. I think we're all becoming more and more cognizant, what I call the older education and training system of the past. That system isn't really set up as well as it should be currently. College, I think we all thought it was the pathway to the middle class, is no longer true anymore. I think we're all too familiar with the scary statistic that college has contributed to this unprecedented student debt crisis. Over $1.7 trillion of student debt held by 44 million Americans.

There is good news out there, because they are great effective short-term programs, certificate programs, licensure programs that can prepare students for great middle-class careers, but they cost quite a bit—$10,000 upwards of $15,000–20,000. That upfront cost is a huge barrier, especially for folks with limited credit or bad credit, people who are leaving the criminal justice systems, immigrants, refugees, or people who just face general barriers to employment. What we're doing at Social Finance is really focused on how to open doors for these folks. Especially people coming from communities of color, women, and people without the financial assets to embark on these journeys. That's where the career impact bond concept was born.

Putnam: Lisa, the work you lead at General Assembly is so critical and so important. I think most people who are listening in today are very aware that computer programming is a high-demand field that leads into a high-paying job. I'm curious, as someone who leads education and training in this field, what do you that are some of the shortcomings in getting into that career path?

Lisa Lewin: Sure. That's such a great question. Look, four-year computer science degree programs at universities have been the most traditional path to a career in computer programming. If you're 17, 18 years old and you have clear access to higher education and you can afford it, and you have the foresight to know at that tender age that you want a career in programming, then that's certainly a viable option. But that's a pretty narrow slice of the population that can access that path. And as Tracy just said, there is huge demand for those kinds of skills. There's a whole population of people that that traditional path ends up excluding. Career changers, people who have a four-year degree already, people who either don't want or simply can't afford the two- to four-year commitment and the expense of a traditional degree program. That's really where accelerated programs like ours are really critical to helping to close those gaps. While our approach, our bootcamp programs, as many people still refer to them as, our accelerated programs are really at a fraction, we offer them at a fraction of the cost of a traditional university degree. Even then, a lot of students simply aren't able to pay for those sorts of programs. The available financing options for alternative and traditional programs like ours are still unfortunately a little more limited than they are for those traditional higher education degree pathways.

That's really what we've been partnering to really help to address, that sort of gap. So that students with limited ability to find access to support and loans for these kinds of programs, or students who have, let's say limited credit histories or other debt obligations, and that's why they're unable to secure financing. We have been exploring and pursuing these alternative financing pathways to ensure that we're not perpetuating a cycle that keeps folks from obtaining the training that they're certainly capable of doing to access these really viable and healthy career paths.

Putnam: Absolutely. I think we'll get in a little bit more about this innovative model, but what I think is so exciting about this conversation today is we've got two representatives who are doing employment and training in two really different industries. Tim, I'm curious if you could help us understand a little bit more about the American Diesel Training Centers and that labor market need that you're trying to address, as opposed to the conversation we're having about technology.

Tim Spurlock: The interesting thing is, you could take what Lisa said and just change a few words and I don't need to say anything. The exact same issues that she articulates on the computer programming side are enormous on the skilled trade side. When you drill down a little bit and you focus on diesel technicians, one in 18 people in the United States is employed in some way in the transportation trucking business. As we see, there's Amazon trucks running up and down my driveway, obviously everything moves by truck. I think the interesting thing, and a little bit of my background is, I came up through educational publishing. And for 10 years, in late 2007 to 2016 or '17, I ran sales for a company that produced courseware for automotive and truck programs. If you were a school offering a program in automotive technology or truck technology, we were trying to sell you our curriculum. I got to go to hundreds of schools around the United States, both for-profit and not-for-profit, and see things from the inside. A couple of things that were just so obvious is that the classrooms were essentially empty. There weren't nearly the amount of students that should have been in this classroom. I got really interested in the problem. I started looking at it from an industry side and saw that there was a huge shortage of both automotive and truck, but we focus on truck technicians, out there. I'm like, this is a really interesting problem to solve.

I think the thing that really was the catalyst for it was that we began getting calls from companies and they would say, "We'd like to buy your curriculum." We'd say, "It's really set up for an educational-type environment." And they said, "We don't care. We're hiring people off the streets with no training whatsoever." I thought this was a really interesting opportunity. I have to tell you, we—in the early days, as we were building the business plan for this—we really modeled it after, in concept, very similar to computer coding bootcamps, or computer programming boot camps. This is what the interesting thing is about education ... it's misaligned in many cases with the skills that companies want. Take a truck technician, for an example. No company on the planet is going to hire someone and say, go rebuild that engine, or go rebuild that transmission. They're going to hire someone and say, could you conduct a preventative maintenance inspection on this truck? Can you change brakes? Can you do basic diagnostic work? Those are the kinds of skills that you don't need even an associate's degree from a community college or a degree/credential from one of the for-profit usually year-long programs out there.

Putnam: Absolutely, Tim. This is great. One of the themes we have been highlighting in the Workforce Realigned podcast, as well as the book, is about the need for these kind of innovations to create a more-inclusive economy and to build a better future of work for all workers. Tracy, I'd love to turn it back to you to talk about, to me, what is just something really exciting in terms of a partnership that does just that, which are the career impact bonds. I'm curious if you could tell us a little about what led to the creation of career impact bonds, and for folks who are listening who haven't had the opportunity to read the chapter in the book, to chat with us a bit more about what is a career impact bond and what is it doing.

Palandjian: Absolutely. The career impact bond was born out of these industry forces. A traditional education and training system where the financial burden is completely borne by the individual, by the worker, whether or not the schooling or the training program delivers outcomes for them. The career impact bond is basically building off of the income share agreement principle, but instead of just looking at the ISA—the income share agreement—as just another consumer finance option, the Career Impact Bond is actually built as a tool for impact. Look at Lisa's program at General Assembly. Look at Tim's program at the American Diesel Training Center. These are two extraordinary programs with extraordinary outcomes for workers, both in terms of persistence rates, graduation rates, job placement rates, and sustained job growth over time. Yet, if you are a low-income person, people leaving the criminal justice system, if you are facing other barriers to access, you can't come up with $10,000, $15,000 to go to ADTC, to go to General Assembly. The Career Impact Bond model is built to eliminate these barriers to access so that more people with potential and without assets can get the skills they need to build better careers and better-paying jobs.

Think of a Career Impact Bond as a student-centered income share agreement. Because of the target population that we're focused on, it covers not just tuition, but also, importantly, wraparound support services, emergency aid funding to help meet rent, transportation, childcare, and other kinds of life needs that the person faces. A student would enroll in a program at no upfront cost to them through a Career Impact Bond. They would enroll at General Assembly or ADTC, and they would go through the program with no financial burden to them at all. The obligation is if they graduate from the program and that they earn over a particular income threshold, they would pay a fixed amount of their wages over either a fixed period of time, or if they've hit a payment cap, undergirded by something what we call a student bill of rights to make sure that everyone around the table is focused on the students' success, so that even after these income share agreement payments, their take-home pay, after the Career Impact Bond payment, they're still better off.

I know that we've interviewed students at Tim's program. On average, they, I think, experience a 50 percent wage bump, going from around $24,000 a year to north of $36,000 a year. I remember talking to a General Assembly graduate on one of our webinars—Lisa, Brandon—who more than doubled his salary in Chicago, going from 30s, I think he was bartending, to in the low 70s as the starting salary. We're really focused on the wage bumps for these people. Also importantly, have everyone around the table have skin in the game, so the training providers would only be made whole if the students achieved success over a prolonged period of time. Of course, all of this is only enabled through what we call an impact for a set of investors. These investors care first and foremost about the impact, and they're willing to accept, potentially, a lower rate of return, or not compensated for the risks that they are undertaking for that investment. We're really, really excited. In addition to ADTC and General Assembly, we have two other Career Impact Bonds going on right now, and more than a thousand people have been enrolled through the investment fund that we have launched, and we're just seeing extraordinary graduation rates and job placement rates even amidst the pandemic.

Lewin: Something that Tim said and something that Tracy said just really inspired me. I just want to point out that Tim and I actually share a common background in educational publishing, and what's interesting about that is that both of us made our own career switches to doing the type of work that we do today. I don't want to be presumptuous since Tim and I are just meeting, but I think there's a reason for that. For a long time, the way that folks thought about quality education was really based on the content. The kinds of companies where Tim and I probably grew up, it was sit somebody in front of a textbook and let them sort out the rest for themselves. And nowadays, there's another version of that, sit people in front of a plug-and-play video or a plug-and-play lecture and let them figure it out for themselves.

What the folks in this virtual room know is that if you really want to transform people's lives and transform their livelihoods, it takes more. It takes a bigger investment. It takes not just great curriculum, which we provide, which both my organization and Tim's organization provide, but it takes all those other supports and services that Tracy just mentioned, the career services and coaching. There is no substitute for one-on-one career coaching, interview prep, networking support, the kinds of things that in traditional recruitment often get overlooked, which as we know are ways that people not only screen for skills—tech skills or hard skills—but also screen for soft skills, and if we're being really honest, are sometimes screening for things like class or communication. Those are the kinds of services and coaching that the Career Impact Bonds allow and support and invest in, in addition to social worker support, in addition to the discretionary funds and emergency cash. Because sometimes, it's not just about your aptitude. Oftentimes, life gets in the way of people being able to really pursue their dreams. I just wanted to kind of point that out because that's certainly a thread in this conversation and in the work that all of our respective organizations do.

Spurlock: We say that all the time at ADTC, life gets in the way. That's one thing that just the current educational system...it really kind of exploded post-World War II, post-GI Bill. It's really not built for today's world in the vast, vast majority of cases. If you said straight up, "Tim, why'd you found American Diesel?" I would say I couldn't take kids coming out of traditional programs, traditional truck programs, $40,000 to $50,000 in student loan debt. I couldn't take it, knowing their starting salary. The second thing is—and this is what the current system really doesn't do particularly well—is we're all about removing barriers. And we identified the two biggest barriers, and I've heard both of them mentioned—cost, obviously—but I would argue that more important is time, because our student, the average age at ADTC is just under 27 years old. Most of our students are in relationships. They have children. They have other things. They just don't have the time to go to a community college for two years or go to university for four years. And they certainly don't have, in the vast majority of cases, the funds or the wherewithal. So yeah, we're so completely synced up, which obviously is why we're both working with Tracy.

Putnam: I was going to say, Tracy has a magical way of bringing people together around innovation and great work, so I should not be shocked by the enthusiasm and alignment here. Lisa, I’d actually love to hear a little more about your Career Impact Bond and how that program is working with General Assembly, if you don't mind digging in a bit about that.

Lewin: I would be happy to. I may take just a couple of steps back to describe sort of how we decided to explore kind of the broader category that the Career Impact Bonds fall in, which is this idea of income share agreements. We decided to kind of enter in that space, which—just to be clear—can have its tensions and controversies, but ultimately we made the decision that we had to explore some sort of alternative means for financing to lower those barriers that we've described to people who have the aptitude but for whatever reason cannot access the traditional financing in order to support and fund their education. Our decision to commit to income share agreements in these different formats really came out of three factors. The first is we felt really comfortable and proud of our track record of being able to secure job placements for people coming through our programs. Because networking and relationships are so essential to job attainment across so many fields, it's one of the reasons it can actually be difficult for some, even if they can demonstrate the skills, to get their first opportunity, especially in an area like programming—and that's regardless of how much talent and what credentials they show. We, as their training institution, have to be confident that we can provide that for them. We build and leverage our own employer relationships on behalf of our students. It's one of the things that we excel at. This model works really well for us because we're confident in our ability to place people that come through our programs.

Second, we have a robust assessment that ensures that the people that are coming through are going to be able to do the work and complete the work and meet the kind of demands and expectations of the program. We wanted to be able to provide some sort of financing means to address what before income share agreements were a lot of students that unfortunately had to walk away from pursuing training that they were perfectly skilled and adept at being able to do, because they simply couldn't find the access or the credit to be able to invest. So that's really why ultimately, we decided that we had to move boldly forward into providing income share agreements and identifying alternative pathways. This group that we together represent, one of the country's first Career Impact Bonds, designed to serve 1,000 individuals across these 10 U.S. cities, to getting them trained in software engineering and other sort of tech areas, which we're so proud to do.

What differentiates the CIB from the ISA is a few things. Number one, it's the demographics. All of the Career Impact Bond students that we invite through our programs fit under enrollment criteria of being recipients of public benefits, or have had some sort of involvement in the justice system, or have had real challenges in obtaining credit, people who have those barriers that we've been talking about, whereas the ISA program is a little bit broader. People can sort of opt into that with the broader criteria. The Career Impact Bond was really intended to have that outsize impact to people who are facing unusually tall barriers to these sorts of opportunities. The other thing that differentiates it is that while we offer career coaching and support to anybody who goes through our programs, and it's one of the things that we are proud of, it's these added supports that we're able to provide, these additional wraparound supports. The emergency fund is another example that we're able to support and fund through these types of partnerships. As we've said many times already, it's that emergency access to funding that enables students who would otherwise be dropping out. Those can be transportation barriers. Those can be hardware and software tech needs. It can be an incident related to an unexpected healthcare cost that can knock people out of their program, something related to rent or bill payment, issues related to dependent care. Things that have absolutely nothing to do with the program itself but are the myriad ways in which we have seen talented people have to drop out of programs and abandon their future, because there was not this cushion for them. That, to me, providing that cushion, is one of the things that I think is really powerful about the Career Impact Bond model.

Putnam: Absolutely. I think so important how we think about not just the training we do, but how we finance it. Tim, I'd just love to hear a little more about how your program works. How is the model in terms of funding and financing for your students?

Spurlock: Our program is a 300-hour program. Vast majority really happened in five weeks. So, students will come to Columbus or Cincinnati, Ohio, from all over the country and they'll stay for five weeks. So, they're in their little bubble. It's really been a great model. All they have to do is train, is study and it's just worked great. We do have a couple, and really, it's the way that we started, we do have a couple of 10-week programs that are part-time. They're really intended for people who are working. They'll come to class in the evening after work, but the curriculum for both is exactly the same. It really boils down to being 300 hours.

Again, what Lisa said was so interesting because this is exactly how we operate too, and we tried everything, right? We tried private student loans. We tried a straight employer pay model. We tried a little bit of both. We tried monthly payments, but things really didn't crystallize until we began working with Social Finance and using the Career Impact Bond. Our primary use of the Career Impact Bond, and it's been a complete revolutionizer, a game changer, is we actually build into the bond a basic starter tool set. The cost of a basic starter tool set, which in the diesel technology world or diesel mechanic world, if you look at job boards, Indeed, whatever, virtually all of them will say must provide your own tools. Imagine if you come out of a program and let's say you're $20,000, $30,000, $40,000 in student loan debt, then you have to go out and potentially buy a $7,000 to $10,000 set of tools, right? It's debilitating out of the gate. We saw this when we first started, so we were able to negotiate great wholesale rates on a very solid set of tools that would retail for about $3,500. We get it for around $1,700, and we give our students the option to opt in. We don't require it. We give our students the option to opt into including that set of tools in the price of their tuition, and 98 percent of our students take that option. It's a difference of literally like $30 a month in terms of payments, right? I don't know of another school or educational program that does that, that anybody who wants to leave the program with a tool set, and it's got everything they need for a very modest payment has that opportunity. That just took things to a completely new level.

It costs a company, whether you're a trucking company, a leasing company, an independent shop, whatever, it's $1,500 for every day that you don't have a working technician. Today, I'm just talking truck mechanics in the United States there's probably about 100,000 openings, right? So, I'm not even including heavy equipment mechanics or power generator mechanics. I'm just talking trucks that you see hauling freight down the road every day. The labor market is so tight that many employers are extremely willing to really fund the payments of that bond on the student's behalf, right? The beautiful thing is, I hear all the time, there's two questions or two statements, usually accompanied with a red face and lots of frustration. I can't find anybody. I can't keep anybody. The Career Impact Bond solves both of them because now we have a portfolio of employers who are willing to fund the education of a student.

That makes it stunningly easier to recruit people. Our company partners will literally hire that individual. They then send them as an employee to American Diesel. We do that training for five weeks. And the nice thing is the employer on the back end with the student works on an agreement that says, "Hey, as long as you work for us, we will make your payments for you, right? But if you leave, if you find that better opportunity, we'll go our separate ways, but that payment is going to follow you." So, we've really been able to address both the finding issue, “I can't find anybody,” and the retention issue because the fact that that employer is now making the payments for that student, right? They think twice before maybe quitting to go make a dollar or two at a shop down the road. It really has been a game changer, and when we do recruiting campaigns promoting this model, we'll have 400, 500, 600 applicants for these jobs.

Palandjian: At the end of the day, it's all about realigning incentives and sharing risks in a way that benefits everyone.

Putnam: One of the things I have loved the most about this conversation is to me this emphasis on the costs that we don't always measure for students. We often talk about, "Why won't people just go through that training program, right? If they would just take that time and go through that training program they can be earning so much more money." Right? And I think what all of you are highlighting is about that opportunity cost and that time cost for a lot of people, not to mention the other actual financial costs of getting an education and this innovation that is really helping to de-risk that for students. I'm curious as if you were to give advice to others who are looking at launching a similar model or impact bond, Lisa or Tim or Tracy, how would you encourage them to focus on those wraparound supports and opportunity costs?

Lewin: I would say what's really key—and what you're hearing from both Tim and me—is you really have to know your audience. You have to know the lives and circumstances of the people that you want to serve. In order to launch an effective Career Impact Bond program, I'd say it's really, really critical to have that deep understanding of the nuances of the population, the things that are going to affect their experience both inside and outside of the classroom, and impact their experience in the job search. In many instances, General Assembly has been able to really anticipate our students' needs in a way that has helped them through our program smoothly from those tech challenges, to those health needs, to the emergency funding. What we do is, in addition to leveraging our decades’ worth of experience with seeing people successfully through these programs, we still every day use surveys and interviews to get feedback both in person, as well as anonymous feedback, from current students about program support services that we can then apply what we learn every day to future cohorts. That to me is really the key. It's having a deep understanding and deep empathy and deep respect for the populations of folks that you aspire to serve.

Spurlock: I would say that really it's all about results. That's one thing that we talk about all the time at ADTC is actually placement is more important to us than recruiting. If we're not doing our job, if we're not going out there and forming this relationship with hiring companies, and I think we're up at well over 200 different companies employ our graduates, and if folks aren't coming through the program successfully, and getting placed in that job and doing well, obviously we're doing something wrong. My advice would be really make sure that your program is effective and delivers results for the students.

Putnam: Where do you see Career Impact Bonds going next? What is the future of this innovative financial model, and what is Social Finance doing around it?

Palandjian: We're incredibly excited about the Career Impact Bond as a tool for impact, especially as we come out of the pandemic toward an equitable recovery, but we've also had an eye toward public policy ever since the beginning. The other way we're putting the Career Impact Bond to work is in the public policy setting in what we call a pay it forward fund concept. In a public policy setting, we have a lot more flexibility. Imagine if a state comes in and says, "You know what? We're spending $100 million in our workforce budget every year, what if we were to park 10 percent of these workforce training dollars in a pool that continuously pays it forward?" Workers who get jobs out of that pool would pay their Career Impact Bond payments back into the pot so that future students could benefit from training into the future. States are not just looking at these pay it forward funds as a workforce development vehicle, but importantly as an economic development vehicle.

We're now working with at least half a dozen states. And they're basically saying, "You know what? Skilled trades, in particular green energy, and offshore wind, is the future of the state alongside advanced manufacturing and IT, and we're going to really use this pool of capital to focus on the workforce of the future and start to shape that economic development agenda as well as the workforce development agenda in a way that's much more sustainable and outcomes focused." These two features at the end of the day have been extremely attractive to governors, especially in a time of austerity. The idea that you can stretch your dollars, instead of just funding one person in one year, stretch it to fund many more people into the future, the sustainability recycling aspect of it has been very attractive. And then the outcomes orientation as you can imagine is just so exciting, right? People would only pay back into the pool if they find gainful employment, sustain gainful employment. We're really excited about the future of Career Impact Bonds. The investment fund, we're now in year three of it having launched it in 2019, and we're beginning to see results like people getting that paycheck, making payments back into the system. It's incredibly exciting to see.

Putnam: I was going to close today by ending on the people. What is really exciting about the work that you're doing is the opportunities here around building a more inclusive and equitable workforce. This is the conversation we've been having a lot right now about racial equity in terms of who has access to career pathways and training programs like yours. Tim or Lisa, I'd love to hear about what impact you think this has on the work that you're doing on building a more equitable and inclusive workforce?

Lewin: GA was founded on the principle to give people access to good paying careers that they will love. We feel what has developed is a really good systematized way of really living up to that promise of access. That has been especially true for traditionally under-represented groups, including women, including minorities, people of color, and including folks from the LGTBQ community. We have created programs that really take the whole learner into account and ensure that our communities, that every GA community around the world, is one that is deeply and profoundly inclusive. Unfortunately, in a lot of places around the world, and I think we still have to say this about the U.S., is that often these barriers to people accessing great quality education is an issue of affordability, and often affordability is linked to things like income and wealth. Income and wealth and lack thereof is often tightly tied and coupled to being a member of an under-represented or minority group in this country. Our ability to lower those barriers to quality education, lower the barriers to financing that kind of education, and then creating programs that are welcoming and inclusive, we feel is the reason why so many of the students that we graduate and give access to these great flourishing careers are folks from non-traditional and under-represented backgrounds. We're super proud of that.

Spurlock: We feel the exact same way. I was just looking at some of our data, but I can tell you right now, there's so many untapped great areas of talent out there. In our current class here in Columbus, Ohio, we are 27 percent Black and I think 10 percent Hispanic, which is great. Overall, we're 19 percent Black or African American, 7 percent Hispanic or Latino, but what's great about that is compared to the national demographics for diesel techs, 7 percent of techs nationally are Black and 13 percent are Latino. We're already outperforming national averages. It's funny; I had a recruiter asked me one time from a company said, "What do you do to recruit underserved populations?" My answer was, "We don't really even have to do anything because it's really where we decide to recruit. I don't care what your background is, what your demographic is, everybody wants a better opportunity for them and their family. That's what we're really able to tap into, and that's the power of what we do. We're extremely proud of our student makeup, and we work every day to make it more diverse and to serve more people.

Lewin: I'll chime in with some statistics on our side. Thirty-seven percent of the people in our Career Impact Bond programs are women, 51 percent identify as people of color or nonwhite, including Black, Asian, South Asian, Latinx, and 26 percent of the people going through these programs are parents. That index is higher than certainly our own programs outside of the Career Impact Bond, and that index is significantly higher than traditional education programs. Access really matters. These programs give access to people that otherwise would not be able to take advantage of these opportunities, and the career impact bond specifically has unlocked opportunity for talent that is ready, willing, and able, but has not had the bridge that the Career Impact Bond provides to being able to capitalize on that talent.

Putnam: That's what this work is about fundamentally. We are talking about very wonky ideas, but we are also talking about individuals who get to go through programs and whose lives are dramatically changed because of their participation in them. Lisa, Tim, or Tracy, I'm just wondering if you could add some color to this conversation and share some of the stories or successes that you've seen so far from your work.

Lewin: I would love to say a little bit more about Brandon's story since he's one of our success stories that Tracy mentioned earlier. Brandon grew up in the foster care system. He had poor credit history from his time trying to make money as a self-taught musician and subsidizing his band's costs. He was kind of tinkering a little bit with coding in his downtime, but just didn't think that he had the means or the credit history to be able to support a program, any accelerated program, at GA or anywhere else. As Brandon tells it, he got in touch with General Assembly, or GA got in touch with him and said, "We have this Career Impact Bond available." A couple of weeks later, he was in and he said it was a huge celebration. He said he went out with his friends who cheered because he felt like this is it. “This is my pathway. This is my chance.” And it's turned out that way for him. Prior to enrolling in GA, he was trying to make ends meet bartending, and he graduated in the midst of this pandemic, got a job, and currently works as a software engineer in Chicago.

I'll share one more, which is from one of our students that graduated in California. If you'll pardon me, I'm actually going to read this one. I spent decades in prison and was able to learn about coding as a member of The Last Mile program. After my release, I didn't have a job. I didn't have credit. I was starting over but wanted to continue what I had learned with The Last Mile. This program helped me enroll in the SEI, the engineering program, and continue my journey. I didn't have a lot of money or options. I was making about 20 grand a year. I have a son. I needed to find something that would improve our lives. This has put me on track for a new career, a new salary, and new skills, and the emergency fund helped me during the pandemic to pay my bills when I could no longer work. I mean, this is what we hear. This is what we hear. We give people who don't feel like they have options a real pathway to a good livelihood, caring about their family, overcoming things from their past. That, to me, is what this work is about.

Putnam: Tim, do you have any stories that have stuck with you that you'd like to share?

Spurlock: Yeah, that's a problem. We could sit here till midnight and I could just tell stories. It's really why we get up in the morning. It was a young man, his name's Francisco. He goes by Daniel. He's a first-generation immigrant into this country from Ecuador. He was from the D.C. area and he bounced around and taking some community college classes, but just wasn't into it. And this kid, just imagine this, he walked into 15 different shops, like truck shops, and said, "I'd like to apprentice with you. Will you hire me and let me apprentice with you?" And 15 out of those 15 shops said no. Luckily for us, he ends up at American Diesel. I talked to the kid and spent some time with him, and obviously, our instructors were like, this kid is an absolute superstar. This kid is going to be phenomenal. He came through the program, he did extremely well, and he went back over to D.C., and he's now working for Penske, a fantastic company.

We take people who are just kind of bouncing around. The vast majority are working hard, but we say they're in high-effort, low-skill, low-wage jobs. They're working really hard. They just can't get ahead. We give them a purpose by teaching them skills that they can use for the rest of their life and giving them a portal into a business where some of our graduates will be CEOs. Some of our graduates will start their own companies. Some will be service writers. Some will be master technicians. That's really what we do is we give them a portal into the business, and we give them a purpose. That's why we love to get up for work every day and do what we do.

Putnam: I think for me, it is that the people that we're serving and talking about in these programs that are the reason we are here. What you're both talking about are the incredible assets we're not leveraging as an economy if we're not doing these kinds of programs and innovations and investments. This has been such an incredible and inspiring conversation. I am so encouraged by all of your work. And I hope that others listening to the podcast today will be encouraged to think about some innovations like these. Thanks so much to all of you for your time and this great chat.

Thank you for joining us for our fifth and final episode of Workforce Realigned. And what an excellent way to close out this series. Today we heard from training programs, both in diesel engineering and in computer and technical skills that are rethinking how they shift risk for their students to provide more inclusive and equitable outcomes.

That's a takeaway we can have from this series. We need to rethink the way we finance worker training education in order to build a more inclusive future of work. We also know that we need to prioritize financing outcomes, whether or not someone is able to get a job and maintain that job and not just outputs like paying for students to attend classes. This has been an opportunity for us to also hear about partnerships, new ways that sectors are coming together, the private sector and the public sector, to ensure that they're not just doing well, but they're also doing good.

I hope you'll join us at workforcerealign.org to learn about some additional case studies happening across the country. You can also participate in some of our events and potential action learning groups down the line. Please visit workforcerealigned.org.Off-site link. for more information about this collective partnership. Thank you so much for joining us in this series. Again, my name is Ashley Putnam, and it's been a pleasure to be your host.