Since 1995, Taller San Jose has worked with close to 5,000 unemployed, under educated, and unskilled youth to provide programs designed to move them out of poverty. They come to Taller San Jose facing major barriers. As Executive Director Shawna Smith explains, “We work with 18- to 28-year-olds with significant life instability. That means they have extremely low incomes, lack basic skills, typically between 5th and 8th grade math and reading levels, and have been in and out of the criminal justice system. And we have a preference for those who are parents. We like a challenge,” she says, breaking into infectious laughter.
When a population like that is locked out of opportunity, how do you advance in the workforce? The answer for Taller San Jose’s Hope Builders, a social enterprise that provides general contracting services throughout Southern California, was to design a pathway to living wage jobs in the construction industry. Hope Builders currently employs eight recent graduates on crews from Taller San Jose’s Construction Workforce Academy, one of four workforce academies—from medical administration to the construction industry—that provide intensive skills training to prepare young adults to get and keep jobs that offer a living wage.
Hope Builders is a unique social enterprise model in that it creates skilled transitional employment opportunities. Taller San Jose invests heavily upfront training program participants for the construction trades, and then utilizes the Hope Builders employment opportunities as a type of apprenticeship.
Smith admits that when REDF came to Taller San Jose with a plan to create transitional job opportunities she was skeptical at first. “We’re running a real business that requires skills to succeed. With a workforce that is constantly green I was worried we would undermine the potential for profitability. The goal my board gave me was at a minimum ‘break even.’ That meant Hope Builders had to be profitable at the same time it maximized turnover to provide the opportunity for more people to enter its workforce.”
After some trial and error, Hope Builders adopted a transitional model that allows for each crew position to turn over at least once a year, doubling the number of young adults that can cycle through the program and move on to permanent jobs. At a traditional construction business, turnover like that would be a death knell. In order to make this approach viable for Hope Builders, it also realized the need to move crew members “up”. Retaining a set number of crew members as permanent employees created the stability the business needed to maintain quality and productivity.
With REDF’s help Smith has discovered profitability and maximizing opportunity in a social enterprise can coexist. The expertise in operational performance management REDF provided showed Smith how Hope Builders could function as a nonprofit in a for-profit business environment. “REDF helped us avoid learning a lot of hard lessons,” Smith says. “Our progress would have been much slower and would have come more painfully. We had the benefit of REDF’s learning, their expertise, advice, and initial funding, so we were able to maximize our impact.”
To be able to compete in the world of low bidder takes all, Hope Builders had to get smart about how it delivers skills to new employees at the same time it transitions skilled workers into living wage jobs. “As we grew,” Smith explains, “we recognized we had to train the next level of leadership, so transitional employees can take on more responsibility in the field. We pair a crew of four with an experienced trade professional. Then we designate a trainee who becomes an assistant to the crew leader. That way, we maintain our bench strength, and deliver consistency, quality and peer mentoring. It results in more stability even as we turn over our employee base every seven months.”
Today Hope Builders is four years old, with a track record of more than $2 million in sales, 27 transitional employment opportunities and nearly as many permanent job placements in residential construction, plumbing, carpentry, and commercial tenant improvements. The data Hope Builders tracks shows powerful bottom line results for its employees. On average “entry level construction jobs in Southern California pay $13.50 an hour,” says Smith. “Those who have graduated from the Taller San Jose construction academy and transitioned through the Hope Builders program are making $15.50 an hour on average.” In the span of a year, that’s a significant increase not just in paychecks, but in lives changed.
-Shawna Smith is the CEO of Taller San Jose, a nationally recognized workforce development program that empowers disadvantaged youth to transform their lives by advancing job, life, and educational skills. In 2011, Shawna launched Hope Builders, Inc., a social enterprise business which provides licensed general contracting services throughout Southern California and creates jobs for Taller San Jose participants. Shawna received her degree in English from Santa Clara University. She was named a Marano Fellow by the Aspen Institute in 2006; and, in 2012, was named a 40 Under 40 Orange County by the OC Metro.