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Hot Off the Press! New Report Highlights Opportunities to Help Young Workers Thrive

By Pamela Chan and Joanna Ain on 04/10/2017 @ 09:00 AM

Tags: News, Financial Capability, Jobs

Click the image above to read the report.

Last summer, with the support of the Prudential Foundation, CFED started on a journey to explore the needs of young, lower-income workers across the nation. As we traveled around the US, we talked with an advisory group of national leaders in the field about financial wellness programs to glean an understanding of what employers know about the financial lives of their workers and how they view financial wellness programs. This work and the findings from it have culminated in the release of our new report, Beyond the Next Paycheck: Creating Opportunities for Young Workers to Thrive. Our research brings to light a fundamental insight: short-term financial worries are getting in the way of long-term financial security, and employers understand that this mismatch hurts their own bottom lines.

From the young workers we interviewed, we learned that concerns about immediate financial needs top the list of financial worries. Almost all of the workers we spoke to were worried about making ends meet—many had concerns over paying their debt and their low savings. Young people like Robert don’t always have enough to keep their utilities on. Likewise, workers like Julia who are also in school worry about their debt getting higher and higher. But, as we learned from our group of advisors, employers don’t often offer services that focus on these immediate needs. Financial wellness services tend to be targeted to higher-income employees with longer-term needs.

This disconnect between what is available in the workplace and what young, lower-income workers need must be addressed. We must encourage employers to find programs that they can run directly and that relate to the short-term and immediate needs (e.g., saving for emergencies, budgeting) of their young workers, rather than long-term needs (e.g., saving for retirement). As a follow-up to our new report, CFED is partnering with the Center for Social Development at Washington University in St. Louis to create a Financial Wellness Program Directory so that employers can find programs that match up with their workers’ needs. There, employers will be able to cull through offerings that speak to the needs of their workers, such as emergency assistance and payroll advances. We're also working to provide additional information for employers to learn more about financial wellness programs and how to take the first steps to get one started in their workplace.

To help ease the disconnect between workers’ needs and services available, we focused on several other key insights to help guide employers that want to support the financial security of their young, lower-income workers:

  • Young workers want financial wellness services that are interactive, individualized, simple and secure. To fit this need, employers should think about services like financial coaching, financial classes, online tools and interactive savings programs.
  • Employers can leverage a number of existing programs, services and resources to meet the financial wellness needs of young workers through partnerships with many nonprofit and government programs that are targeted to the specific needs of lower-income workers.
  • Employers can and should track effectiveness and impact of services to help demonstrate a return on investment on such programs in the long term.

Employers have an important opportunity to positively influence the financial well-being of young workers. With the release of Beyond the Next Paycheck, we hope that employers can better understand what kind of financial wellness programs young, lower-income workers need in the workplace so that this emerging workforce can be primed for financial security well into the future. Stay tuned for more in the coming months!

3 Reasons Why Americans Are Numb to the “Economic Recovery”

By Dedrick Asante-Muhammad and Holly Heafey, Graduate Intern on 07/21/2016 @ 11:00 AM

Tags: Racial Wealth Divide, Jobs

Editor's Note: This article originally appeared on the Huffington Post.

Great news! The latest jobs report revealed that unemployment is down to just 4.9%, a rate that many economists argue is equivalent to full employment. Clearly, our nation is in better economic shape than 2009 when unemployment was at 10%, 2.8 million households lost their homes to foreclosure and the stock market had hit a 12-year low. Yet, you won’t hear many ordinary families shouting from the rooftops about the recovery; most Americans still see today’s economy as fair to poor. So why is there so much tension between the economic indicators and the sentiments of so many Americans, seven years into the economic recovery? These three factors contribute to the strong feeling of economic insecurity.

  1. Unemployment rates have recovered, but underemployment hasn’t. To get a fuller picture of how Americans are doing in the job market we must examine the “hidden unemployment rate,” which is known as the U-6 unemployment rate or “underemployment rate.” The underemployment rate, includes workers who are working a part-time job but would prefer to work fulltime, overqualified workers working low-paying jobs and people who have been job-seeking in the past year but have not actively searched in the past four weeks. Underemployment has increased from pre-recession rates. Before the recession, the national underemployment rate was 8.2%; now it’s 10.1%. Today, African Americans and Latinos have underemployment rates of 15.9% and 12.9%, respectively, even higher than the national average. Most American communities are still experiencing high underemployment. What does that mean? It means that even though many workers may not be counted as “unemployed,” they still do not have access to the types of jobs that allow for financial security and stability.
  2. Wages have been sluggish and more and more unequal for the last 35 years. If we were to adjust the national income of today by inflation, we would see that many American families are earning the same income they would’ve earned decades ago.
  3. Most importantly, wealth hasn’t recovered to pre-recession levels — and for African Americans and Latinos, it continues to recede. Pew Research Center reports that in 2007, median wealth of all households was $135,700; by 2013, it had dropped to just $81,400. If we look at the three largest racial/ethnic groups we see the great economic insecurity of African Americans and Latinos and how their wealth continues to decline while white wealth has begun to recover. Black median household wealth has declined from a meager $19,200 in 2007 to $16,600 in 2010 to $11,000 in 2013. Similarly, Latino median household wealth experienced a similar decline. White Americans also saw a dramatic loss of wealth during the Great Recession, with wealth of $192,500 in 2007 falling to $138,600 in 2010. But while white-owned wealth still hasn’t reached pre-recession levels, white median household wealth — unlike that of blacks or Latinos — has begun to rebound, growing to $141,900 in 2013. This unequal recovery is just one more reason many Americans are still waiting for better economic opportunities.

Low unemployment and a strong stock market does not mitigate the reality of stagnant wages, growing economic inequality, widespread underemployment and a loss of household wealth. A job is not enough to ensure real economic security and well-being, and until the country sees a rebound in median household wealth with a decline in racial wealth inequality, the US will still be far from building a strong and inclusive economy.

Turning this tide of economic insecurity will require bold policy changes, from reforming unfair tax spending to tackling racial wealth inequality. As the issues of race, economics and politics are searing the headlines, it is as important as ever that the nation focuses on building an economy where the nation can be united in economic security.

Addressing Financial Barriers to Help Clients Find Jobs

By Kori Hattemer and Matt Garlipp on 04/16/2014 @ 11:00 AM

Tags: Financial Capability, Integrating Financial Capability, Jobs

Photo by Lance Cheung, USDA

Over the past two weeks, we introduced the Housing and Emergency Assistance cohorts of our Integration Learning Cluster. As we mentioned in those posts, the Integration Learning Cluster is comprised of 11 social service organizations from three sectors—Housing, Emergency Assistance and Workforce Development—that are incorporating financial capability services to help their clients achieve lasting stability and independence.

The members of the Workforce Development Cohort provide various job training and placement services. Their typical client:

  • Is receiving some form of income.
  • Is goal-oriented.
  • Has competing priorities, such as trying to find reliable transportation and child care.

Given the priorities of this population and the goals of the organizations, the Workforce Development cohort members are trying to answer:

  • What are the financial barriers to finding and keeping a job?
  • What is the right combination of services that will help our clients overcome those financial barriers?
  • What is the right point in time to offer different financial capability services?
  • When our clients are focused solely on finding a job and securing a stable income, how do we motivate them to also improve their financial lives through activities such as credit repair and saving?
  • What is the measurable effect on employment outcomes of integrating financial capability services?

Four workforce development organizations were selected to address these critical questions as members of the Integration Learning Cluster:

FEGS is a health and human services agency in New York City that serves 100,000 people per year. FEGS participated in our previous Integration Learning Cluster, during which they prepared job retention counselors to refer clients in their welfare-to-work program to a starter savings account and financial coaching. During this Learning Cluster, they plan to expand financial empowerment to five additional workforce development programs that serve adults and youth, including a second welfare-to-work program.

Goodwill Industries of Sacramento and Northern Nevada (Goodwill SAC) operates 23 retail stores and 70 collection sites across California and Nevada. Goodwill SAC has funding from United Way to implement a Financial Coaching Program in partnership with five other community partners. Goodwill is the lead organization and will be integrating financial coaching into its existing workforce development program. They are using an innovative household assessment tool, the “Labor Market and Financial Capability Outcome Scale Matrix,” to assess clients and track progress over time.

IMPACT Community Action in Columbus, OH, offers three service branches: emergency services, home weatherization and empowerment services (including workforce development and financial services). While the organization already implements some financial empowerment services, they have identified a need to better integrate these into their “Employment Plus” program to help clients develop the financial capabilities they need to be successful in either postsecondary education or employment.

Primavera Foundation offers a continuum of housing and workforce development services to address homelessness, poverty and neighborhood destabilization throughout the greater Tucson, AZ, area. Primavera wants to incorporate their existing financial education and savings program into their Primavera Works program, which provides day-labor opportunities for people enrolled in a Primavera housing program or shelter. They want to leverage the time when a person is working and earning money to give them the tools and skills they need to manage their income and save.

As these organizations and the other members of the Integration Learning Cluster develop innovative strategies for helping their clients achieve financial security, we will continue to update you on their progress and the challenges they face along the way through additional blog posts and briefs.

In the meantime, check out some of our other resources about integrating asset building into social service delivery:

Interested in learning more? Tomorrow, CFED and the Center for Financial Security at the University of Wisconsin-Madison are hosting a free webinar on the findings from the Assessing Financial Capability Outcomes pilot, which tested the integration of financial coaching and account access into a workforce development program in New York City. Click here to register.

This Learning Cluster is generously supported by the Bank of America Charitable Foundation.

Also in This Series

2014 Scorecard Deep Dive: Businesses & Jobs

By Lebaron Sims on 03/04/2014 @ 11:30 AM

Tags: Assets & Opportunity Initiative, Data and Research, Entrepreneurship, Jobs

Last month, CFED released the 2014 Assets & Opportunity Scorecard, a comprehensive evaluation of the relative financial security of the American public. This series takes a closer look at some of the outcome trends within each of the Scorecard’s five issue areas.

As mentioned in our post on Financial Assets & Income outcomes, the national economy has in many ways rebounded: the business creation rate increased for the third consecutive year, while private loans to small business continue to tick upward. Households, however, have yet to experience the same progress. Household financial indicators like household income, net worth, and liquid asset poverty have yet to fully recover from the shock of the recession.

Unemployment and Underemployment

The national unemployment rate continued its steady decline throughout 2012 and into 2013, decreasing every month and dipping below 7% for the first time since November 2008. Underemployment, however, remained near 15%, indicating a labor market that, though much improved, is far from healthy. Two states – New York and Delaware – saw underemployment increase in 2012. Workers of color, too, have yet to experience the benefits of the recovery – workers of color remain unemployed at a rate over 66% higher than that of White workers.

Low-Wage Jobs

The share of jobs with a median wage compensation below the poverty threshold decreased in all but five states, demonstrating a modest trend away from low-wage compensation jobs. There is still quite a way to go, however: over one in five jobs nationally fails to provide a living wage (defined as paying an annual rate commensurate to the federal poverty line for a family of four), and a third or more of all jobs in three states (Mississippi, West Virginia and Alabama) are low-wage.

Employers Offering Health Insurance

The percentage of employers offering health insurance to their employers decreased once again in 2012, continuing a decade-long trend. In 31 states, participation rates declined from 2011; only six states – Kentucky, Minnesota, Nevada, New Hampshire, Oklahoma and Wisconsin – had higher rates in 2012. The participation decline has been largely driven by businesses with fewer than 10 employees – only 28.2% of these businesses offered health insurance to their employees in 2012. As data from the ACA’s full implementation rolls out over the next few years, it will be fascinating to see how these numbers change, particularly among small businesses.

States can continue to support working households by promoting a living wage for all workers, and help out-of-work residents build businesses by offering self-employment assistance programs, or offering support or financial incentives for microenterprises. For more data, including a breakdown of policies your state can implement to help workers and small businesses survive and thrive, visit the Scorecard website, or download the full 2014 Scorecard report, “Treading Water in the Deep End,” here.

Also in this Series

Self-Employment IS Job Creation

By Sean Luechtefeld on 12/10/2012 @ 03:30 PM

Tags: Entrepreneurship, Jobs

Twenty-twelve was a banner year for small business. The election, combined with the lingering aftereffects of the Great Recession, brought small business to the forefront of a national conversation about job creation. Indeed, the American public refuses to believe that it’s only large corporations who create jobs.

In fact, not only is it not the case that large corporations create new jobs, but rather, according to research by the Kauffman Foundation, it’s new and small businesses that are solely responsible for all net new jobs that are created in this country.

All net new jobs.

Although this fact is realized by the owners of startups under a year old – those responsible for job creation – the public is yet to embrace a system that supports entrepreneurs who, in essence, create jobs for themselves where employment is otherwise unavailable. Meanwhile, millions remain jobless in an economy that still has a long way to go.

The struggles facing low-income people who turn to self-employment, though real, certainly aren’t insurmountable. For example, one barrier facing the self-employed is that the cost to file the taxes necessary to stay “legal” is high. In many cases, paying to file taxes which themselves come with a lofty price tag simply isn’t viable for business owners who lack liquid capital in the first place. Yet, programs exist to help these filers. Volunteer Income Tax Assistance (VITA) sites – nonprofit programs authorized by the IRS to provide free or low-cost tax filing services – not only defray the cost of filing, but can also help low-income entrepreneurs claim the Earned Income Tax Credit (EITC). Annually, the EITC delivers $7.5 billion in capital assistance to 4.4 million self-employed households.

As a related example, low-income business owners often lack capital and business services that help more established businesses succeed. These services are currently being offered by nonprofits all over the country who help owners of startups access checking and savings accounts or who offer workshops and trainings on homeownership, foreclosure prevention, business development and financial management.

These programs are already proving successful in hundreds of communities throughout the US. To expand on these successes, the federal government should expand programs that help entrepreneurs. Doing so would help more low-income entrepreneurs succeed. When they succeed, we all benefit.

The key, of course, is making the obvious yet overlooked argument: that self-employment IS job creation.

Be Your Own Boss! California’s Opportunity to Support Self-Employment and Job Creation

By Heidi Pickman, Guest Contributor on 11/09/2012 @ 08:30 AM

Tags: Entrepreneurship, Financial Capability, Jobs

Right now, California leaders have the opportunity to assist the unemployed to become self-employed, create jobs and reduce the unemployment rolls – all at the same time. Last spring, the federal Department of Labor government set aside $5.3 million for California to help unemployed workers start their own businesses, but so far the state has left that money on the table. The money is part of $35 million in grants that Congress made available for states to implement expansions of the Self-Employment Assistance (SEA) program. Under the SEA program, unemployed workers receive up to 26 weeks of unemployment insurance benefits while starting a small businesses – a full-time job in its own right. Participants receive training and assistance and do not have to look for other full-time work during that time. States have to opt in to the SEA program, but California has not yet done so.

To start a California SEA program and access the $5.3 million, the state legislature needs to pass a bill. CAMEO is working to make this a reality, but surprisingly there is opposition. “We initiated the Help Unemployed Be Your Own Boss (BYOB) campaign because California’s unemployment rate continues to remains higher than the national average,” said Claudia Viek, C.E.O. of the California Association for Microenterprise Opportunity (CAMEO). “If the unemployed can’t find a job, they can create their own. California needs to apply for these federal funds and train the unemployed to become their own boss.” CAMEO launched this petition to show Governor Brown and state legislators that Californians need and want this program.

California has had double digit unemployment for more than three years and a persistent problem with long-term unemployment. The percent of long-term unemployed (jobless for 27 weeks or more) as a share of total unemployed in California rose from 19.9% in December 2005 to 44.5% in December 2010. This dramatic increase in long-term unemployment has hit all demographic groups in California, but some populations experience more long-term unemployment than on average, including minorities and older workers.

Self-employment must be part of any economic recovery plan for California because existing companies are simply not creating enough jobs. Self-employment is a growing labor market trend; before 2000, self-employment grew at an average of 1.4% a year but post-2000, self-employment grew at an average of 3.5% a year. As of 2009, self-employment was more than 25% of wage and salary employment in California. The self-employment rate is projected to continue to grow in the years to come, increasing by an estimated 7.2% in the next five years. The SEA program would help those jobs develop faster and ensure that new business owners have the skills they need to succeed—but only if California acts soon. The deadline to apply for the $5.3 million in SEA funding is June 2013.

Please support CAMEO’s efforts! Sign the Be Your Own Boss petition and invite 10 or more friends to sign it. Spread the word with Facebook and Twitter.

AEO Launches 1 in 3 Campaign

By Kim Pate on 05/02/2012 @ 03:15 PM

Tags: Entrepreneurship, Jobs

As part of its 1 in 3 Campaign, the Association for Enterprise Opportunity has unveiled a new report at its annual conference further proving it’s proposition that, “If one in three microenterprises hired just one employee, the U.S. economy would reach full employment.”

In addition, the report concludes “If demand for microenterprise-intensive services and products was met locally in communities around the United States, we could create 10-16 million new jobs.” That’s based, the report says, on a survey of business owners who identified the local consumption impact on the 20 most microenterprise-intense industry sectors. That’s the key: people must start buying from the mom-and-pop shops.

This aligns with CFED’s Self-Employment Tax Initiative (SETI), funded by Sam’s Club Giving Campaign because SETI supports the notion that state and local governments can facilitate job creation by providing federal tax preparation assistance to new businesses and the self-employed.

Aspen Asks: Can America’s Small Businesses Deliver Growth and Financial Security?

By Lauren Williams on 04/26/2012 @ 01:30 PM

Tags: Entrepreneurship, Jobs

Small business defines American economic growth. CFED certainly believes that it can help families build financial security and Karen Mills, Administrator of the Small Business Administration, agrees.

At an event on April 12 hosted by the Aspen Institute as part of the “Building the Economy We Want: Aspen Asks What Will it Take?” series, Administrator Mills was interviewed by Jared Sandberg, Editor of about what is needed to make small business a robust engine of development for jobs that offer financial security for workers. Though many would argue that the SBA has a long way to go in order to better fulfill the needs of really small businesses—or microenterprises—she shared several encouraging insights regarding SBA’s commitment to small business development:

  • What is the role of small business in that process and how is SBA supporting that role? Small business is, without question, the job creating engine of the American economy. Of the more than 27 million businesses in the United State, 99.9% are defined as small businesses with fewer than 500 employees. According to the Kauffman Foundation, without business startups, there would be no net job growth in the United States economy. The Recovery Act allowed SBA to increase its maximum guarantee on 7(a) loans to 90%, which was intended to reduce lender risk and encourage them to offer more and larger loans to small business owners. Administrator Mills argues that we are now in a recovery of substance fueled by entrepreneurship, regional cluster building and innovation.
  • What about access to capital? Why are banks so averse to actually banking? What is SBA doing to improve access to capital? Early on in this most recent financial crisis, banks pulled back on their small business lending activity in order to avoid risk and some simply didn’t have enough capital to lend. Even after the Recovery Act attempted to lessen the risk to lenders of conducting business, access to capital has remained constrained in the American economy. Additionally, some argue that it simply costs banks too much to make small dollar loans for it to be profitable, which creates challenges for microenterprises seeking small amounts of capital in particular. SBA has tried to resolve some of the cost burden on banks making SBA 7(a) loans, minimize duplication and allow for quicker turnaround by reducing the number of pages of the SBA loan application from 46 to 8.
  • Many sources of personal wealth and resources of low- and moderate-income families were depleted during the recession. How do we build that wealth back? The Administrator didn’t offer up any specific methods for helping families build wealth that was depleted during the recession, but did highlight the central significance of home equity in many of the communities hardest hit by the financial crisis, and encouraged the importance of a more inclusive vision of entrepreneurship going forward.

When it comes to helping families build personal wealth, CFED is rich with ideas. We know that achieving household financial security is a dynamic process in which families iteratively gain skills, increase income, begin to save, leverage savings into assets and protect gains made along the way. We know that families’ ability to build assets depends greatly on the quality of their access to public benefits, tax credits, quality job opportunities, affordable basic goods and services, debt reduction, low-cost financial products, public incentives and consumer protections. We also know that small business ownership, often starting with self-employment, is one way that many low- and moderate-income families create their own jobs and that policymakers and federal agencies that support small business are integral in developing a framework to support those families along the way.

New Federal Funding Available for CDCs to Create Jobs and Combat ‘Food Deserts’

By Jimmy Crowell on 04/24/2012 @ 09:45 AM

Tags: Jobs

Last week, the Department of Health and Human Services (HHS) Community and Economic Development (CED) program announced that they will be providing $27 million (up to $800,000 per project) in grants to community development corporations (CDCs) for projects that create jobs and business development opportunities for low-income individuals. Through this grant, the CED program aims to create new employment opportunities for Temporary Assistance for Needy Families (TANF) recipients and individuals living on incomes at or below 125% of the Federal Poverty Level.

The CED program, in coordination with the Healthy Food Financing Initiative (HFFI), will also provide up to $10 million for CDCs working to increase access to affordable and healthy foods in low-income communities. HFFI was created by the Obama administration in early 2010 to combat the growing number of food deserts, or communities with little access to fresh, healthy foods, in America. This funding from the CED program is designed to enable CDCs to develop food retail outlets and enhance healthy food infrastructures in low-income communities.

Applications for the CED program are due June 5, 2012 and can be submitted electronically here. We hope our partners in the field will be able to take advantage of this new funding opportunity!

Founder’s View: The Myth of the 1%

By Bob Friedman on 03/05/2012 @ 09:30 AM

Tags: Entrepreneurship, Jobs

Republican leaders like Speaker Boehner have suggested that increasing tax rates on the wealthiest one percent of Americans would be a mistake, alleging that the top one percent are the preeminent job creators and entrepreneurs in our economy. In fact, it turns out that the top one percent create only about one percent of businesses and that the lion's share of new businesses are started by the remaining 99%, including middle- and low-income Americans, trying to create jobs for themselves.

What’s more, the primary source of investment in the 2-2½ million new businesses started each year (which are responsible for almost all net new jobs created each year) is personal savings and the savings of friends, family and associates – not the resources of the wealthiest one percent. There may be other reasons not to increase tax rates on the top one percent, but impact on job and business creation and investment are not among them. Let us look instead to the opportunities open to all our people, especially those who may have entrepreneurial capability and interest, but not the ability to invest in themselves and their families.

When one examines the best available data, it becomes clear that the wealthiest one percent are not particularly more likely to be active entrepreneurs deriving a substantial portion of their income from their ventures than the other 99 percentiles. In fact, according to the Office of Tax Analysis of the Treasury Department, millionaires make up only .5% to 1.4% of small business owners. Ninety-nine percent of small – and new – businesses are founded by the rest of us; we represent all income brackets, races and education levels and we come from all over the country.

New jobs, in fact, do not come primarily from small or large businesses, but instead, from new businesses under one year old. According to the Kauffman Foundation, over the last thirty years, it is these youngest firms that have created all net new jobs, adding an average of three million per year.

Over the last thirty years, the job contribution of new and young businesses has varied from highs of 3.6 million to lows of 2.2 million. For the last couple years, we have been at one of those lows in new business job creation, at a time when we can least afford it. No wonder the nation is asking how to create jobs and only beginning to look in the right direction for how to stimulate the formation and growth of new and young business.

When one looks at the nature of new business job creation, the first finding is that most startups are small indeed, often employing only the entrepreneur herself/himself in the first few years. Some two million Americans create jobs for themselves each year, many part-time. Some of these businesses are pioneering new edges of the economy (green burials for the aging, soon-to-be-dying baby boomers; indigenous beans; new digital domains and new services) while others offer more prosaic goods and services. In both cases, entrepreneurship is often driven by necessity. Nevertheless, it remains the difference between some income and employment and unemployment and poverty.

Twenty to thirty percent of the self-employed add employees, sooner or later. Three percent or so of business starts grow to some size, creating tens or hundreds or thousands of jobs, and in some cases, they build whole new industries. It is on these high-growth firms that the Kauffman Foundation, the President’s Start-Up Initiative and many business leaders are now focused. Indeed, the cultivation of seed and venture capital firms, incubators, expanded H-1 Visas and lower tax rates for new businesses are all worth pursuing.

But what of the other 97%? Should we ignore them? More to the point, if you had met Steve Jobs when he was a college drop-out from a blue-collar home with an interest in calligraphy and acid, would you have recognized him as the stand-out entrepreneur of our generation? Unlikely. So, if we really want to increase the yield of our economic garden, perhaps we should water all the plants.

How do we do that? For starters, the un- or underemployed American considering whether to start a business and create a job for herself should be encouraged through tax deferrals that could temporarily reduce business costs (for example, not having to pay both employer and employee shares of FICA). Likewise, would-be entrepreneurs should have greater access to the personal savings and savings of families, friends and associates from whence the overwhelming majority of all investment in new business starts comes. To facilitate this, we should make the existing Saver’s Credit refundable and available for new business creation as well as homeownership, college and retirement. We should also think critically about a two percent reduction in the Self-Employment Payroll Tax, which looks like it may be the beginning of a true Self-Employment Tax Credit. Finally, we should remove the penalties poor and unemployed families depending on some form of public assistance face when trying to create their own jobs. This includes asset limits in welfare, Social Security, Food Stamps, health insurance and more.

In short, it’s new and young, not small or large. It’s savings and equity, not debt. It’s tomorrow’s economy, not yesterday’s. It’s powered by all of us, not just the top 1%. And, perhaps most importantly, it’s with tax incentives for saving and entrepreneurship for all, not just for our wealthiest neighbors.

The Economic State of America's Higher Education System

By Peter Kim, Guest Contributor on 02/13/2012 @ 03:30 PM

Tags: Education, Jobs, Recommended Reading

For years it was the dream of many Americans to send their children to college. However, it has turned into a fiscal nightmare for parents as tuition costs rise while the number of available jobs has not. Students and their families have taken huge sums of debt on the assumption that their college degree will be an instant ticket to a high-paying job, but those jobs are nowhere to be found in the current market. This spring, college graduates are entering a labor market with fewer jobs that require a college education. On top of that, a Yale School of Management study suggests college students who graduate in a recession can earn 40% less than students who graduate in better times. Higher education is turning into a bubble.

According to a 2010 report in Money magazine, the cost of college tuition has gone up 439% since 1982. Another study saw the rate of tuition growth increase four times the rate of inflation and twice as much as health care since 1978. While federal aid has offset some tuition for eligible students, their inability to find jobs has put a strain on their ability to pay back student loan payments. Some columnists blame the government for interfering with the market, arguing that federal aid encourages students to take on debt they may not be able to pay back.

As a result of the stagnant economy and continued high unemployment, college graduates are being forced to take low-paying jobs, sometimes multiple jobs, to pay bills. Graduates who took artistic disciplines have relied on freelance work to help make ends meet, but this is not enough. Others have chosen to do public service; in 2009 at the height of economic malaise, AmeriCorps reported a 42% increase in applications, of which 70% were college graduates. Still, others have decided to stay in school and go to graduate school.

Regardless, the lack of opportunities for capable graduates has forced many to return to graduate programs instead of contributing their skills to society. As a result, increased enrollment in college has resulted in the cost of higher education rising. Upon graduation, 65% of students graduate with debt, with the average student owing $24,000 in 2009. Facing unsustainable borrowing costs and a lackluster economy, graduates are finding it increasingly difficult to pay back their loans. Today, the higher education bubble is bursting at the seams as 10.8% of students at public institutions defaulting on their loans within three years of graduation (default rates at for-profit schools are double!). Today, understanding the long-term costs and benefits of attending a college will be more important than ever before. Digging deep to find grants, scholarships, and using all the resources available to you will be a great way for you to ensure a debt-free future.

For more information, watch this motion graphic created by Education News.

Created By: Education News

With a passion for education and technology, Guest Contributor Peter Kim is getting involved in hopes to help innovate the way information is presented and received. Follow Peter on Twitter.

Exciting Professional Opportunity in Dallas/Fort Worth Area

By Susan Hoff, Guest Contributor on 01/19/2012 @ 10:30 AM

Tags: Jobs

United Way Metropolitan Dallas Seeks Director of Financial Stability/Asset Building

United Way of Metropolitan Dallas is seeking a dynamic professional to lead a community organizing and planning effort to develop a comprehensive community plan to address family financial stability and asset development. Work will include analyzing existing resources in Dallas and around the country, developing a plan for strengthening and scaling successful programs, and identifying effective programs in other communities and developing a plan to import them. The successful candidate will have expertise and a proven track record in community organizing and planning, excellent verbal and written communication and facilitation skills, and strong working knowledge of financial stability and asset building programs and services.

This position is comes with a competitive salary and benefits package. Interested applicants should forward their resume and cover letter to Susan Hoff, Senior Vice President for Community Impact, at

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