Philanthropy's new focus in Minnesota: Putting people into jobs

Minnesota philanthropies are putting more time, money and political clout into efforts aimed at getting jobs for the state's neediest residents.

The new focus reflects a growing sense that the most effective way to address homelessness, poverty and the effects of racial disparities may be through job training and workforce development.

Training that leads to employment "is the best cure for many of society's challenges," said Brian Lipschultz, co-CEO of the St. Paul-based Otto Bremer Trust, which gave away $47 million last year.

"The word 'jobs' is more front and center. People are thinking a lot more about it."

A group of foundations called the Minneapolis-St. Paul Regional Workforce Innovation Network — MSP Win for short — has waded into state and local politics, urging more accountability in how the state spends its $150 million annual budget on workforce training.

Job training programs have always been on philanthropy's radar. But an anticipated worker shortage and a skills gap in several job areas, coupled with troubling income gaps between whites and minority groups, are giving them new urgency.

U.S. Bank last year gave more than $5 million in grants to college and career development programs across the country, including nearly $2 million to Twin Cities programs ranging from scholarships for gifted students to a combined GED and jobs training program at Summit Academy in north Minneapolis.

"In diverse communities, we are doubling down on work," said Greg Cunningham, U.S. Bank's vice president of global inclusion and diversity. He added: "We can't build vibrant communities unless people are working."

Just last month, Otto Bremer gave $1 million to nonprofits involved in workforce development and training. Aretha Green-Rupert, regional director at Otto Bremer, said there's a realization that while emergency food and shelter programs are needed to stabilize families in crisis, "they don't move anyone out of poverty."

The McKnight Foundation started looking at workforce development five years ago and has spent more than $1 million on its efforts, said Eric Muschler, program officer for the regions and communities program.

"We are really focused on the economic well-being of families to be self-sufficient," Muschler said.

MSP Win, about a dozen foundations hosted by the St. Paul Foundation that includes McKnight, Greater Twin Cities United Way and Otto Bremer, lobbied legislators in 2014 to create an annual report card to measure outcomes of training programs funded by the state.

The report card, kept by the Minnesota Department of Employment and Economic Development, measures the costs, completion and employment rates, and wage increases for training programs. It helps lawmakers, foundations and businesses make better decisions about what to fund.

There was initial skepticism, said Bryan Lindsley, executive director of MSP Win, because programs didn't want to do more reporting or risk funding if results didn't measure up. But the goal is "to strengthen the public workforce system and get better results for families," he said.

MSP Win convinced the state to invest more in proven winners. Then it persuaded legislators to nearly triple the budget of its proven Pathways to Prosperity programs, to $12.3 million for the next two years, Lindsley said.

In the Pathways program, people are trained for specific jobs through community colleges, nonprofit programs and on-the-job training. In Hennepin County, those who complete training are guaranteed an internship and then a job interview with the county.

Since the program was launched, the county has taken 400 interns and hired about 130 people full-time who make at least $15 an hour with benefits. That takes people off the welfare rolls while also helping to fill hundreds of vacancies ranging from 911 operators to IT support.

Hennepin County Administrator David Hough said he welcomes MSP Win's advocacy for job training.

"As a region, our economic viability depends on us getting people educated, getting them employed and earning a livable wage where they can support their families." Hough said.

MSP Win is analyzing job openings by area — health, construction, IT, for example — to better understand market demand. It's bringing together employers, unions, and trainers to map out successful career paths.

Ryan Ponthan, a business representative for the North Central States Regional Council of Carpenters, a union covering carpenters in six states including Minnesota, said an infusion of philanthropic dollars into worker training is welcomed and needed.

"I am out on job sites every day, and I see there is a need for more skilled labor out there," Ponthan said. The union also offers skills training, he said.

Trades give workers a shot at achieving a comfortable middle-class lifestyle. Apprentice carpenters start at $18.50 an hour plus benefits, and that doubles when they reach journeyman status, Ponthan said.

He particularly supports efforts to determine market demand and then invest in training programs. "That's the right approach," he said. "What does the industry need? What type of talent is the industry looking for and demanding?"

MSP Win has been instrumental in the Twin Cities Regional Workforce Council, which will meet for the first time this fall to create a metrowide plan for workforce development and job training. Commissioners from seven metro counties and Minneapolis Mayor Betsy Hodges will serve on the new board.

"We recognize our county borders really mean nothing to the labor force. It's important to really work together to look at the entire region," said Anoka County Commissioner Rhonda Sivarajah, a board member.

Summit Academy, a vocational training school that annually trains 750 adults in construction and health care, is being held up as a model and innovator. Its 20-week training programs are free of charge, and the school — with a $7.5 million operating budget — relies on government and foundation dollars as well as individual donors.

Summit's new 30-week program promising a GED and job training has financial backing from Otto Bremer, U.S. Bank, Target and MSP Win. Summit graduates, unemployed when they enroll, reported earning $15.08 an hour two years after leaving the program.

Louis King II, Summit's president and CEO, said the school's appeal is simple: "The best social service program is a job. We have demonstrated through years of welfare and philanthropy [that] we cannot replace two working parents."

Tamir Raheem earned his GED at Summit and is now halfway through the carpentry training program. Before starting the program, he had earned $15 to $16 an hour as a powder coat painter at a machine shop. But he wanted a career with more income potential and creativity, and the possibility of one day being his own boss.

Raheem, 33, of St. Paul, said he wants to join the carpenters union and send his five kids to private school, perhaps move to the suburbs. He said that Summit's training program provides the skills and connections he needs.

"I wanted to do more with my life than working in a factory," he said.

Tony O'Brien, Summit's academic program director, said the intensity and drive of students like Raheem is palpable.

"It's not a handout. It's a hand up," O'Brien said. "These are really good people."

Shannon Prather • 612-673-4804