Aligning the Demand and the Supply of Social Enterprise

Despite the lowest unemployment levels in decades, a rising percentage of working-age Americans are not in the workforce. While demographic factors can explain some of the discrepancies, there’s more to the story. Much more can be done to move the needle in a positive direction that most Americans – who believe in the value of self-reliance and hard work across the board – would support.

In fact, a path-breaking report by Kevin Corinth at the American Enterprise Institute (AEI) estimates that 9.6 million adults and ”disconnected youth,” all of whom are not working, face barriers that social enterprise jobs are tailor-made to address—like histories of incarceration or homelessness, addiction, or mental illness.

There is a lot of talk about “scaling up” promising approaches to society’s biggest challenges. REDF and our social enterprise partners across the U.S. are growing to meet the demand for jobs among those who face the kinds of obstacles assessed by the AEI study.

By providing transitional employment in a supportive work environment that invests revenue in a range of skills training and then helps employees move on to mainstream jobs, researchers have confirmed that social enterprises generate $2.23 in “social return” for every dollar they spend helping prepare people for work.

These social enterprises have achieved more positive results—such as job retention that is 33% higher at the end of a year—than other programs have been able to with these populations.

Later this month, REDF will launch our inaugural national census of the social enterprises that offer jobs and training to those identified by the AEI report. While 9.6 million may seem like a daunting number, consider this example: If we build a social enterprise community that can routinely employ and train 500,000 people each year, we can put a significant dent in the numbers of people who have been excluded from the workforce for far too long.

Stay tuned for Chapter 2, where we’ll put the jobs numbers from thriving social enterprises across the U.S. together with the AEI assessment of total “need.”’ This combined data will allow us to clearly align the demand and the supply of social enterprise, so that tens of thousands more people can move into the workforce and have the opportunity to build a better future.