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A Double Bottom Line Investment: Giving Young People A First Job

President Obama is calling on communities and businesses to sign on to the “First Job” Recruiting and Hiring Compact to help youth find employment.

Particularly when you’re just starting off in the workforce, the prospect of finding a job with a blank resume and limited network and connections can be daunting. This process is tough for college students and even harder if you’re one of the one in seven young Americans who are out of school and work.

Here’s the thing: one of the main things employers are screening for in the hiring process is work experience. It allows them to call references who can vouch for a candidate, assess what someone can do based on demonstrations of what he or she has produced in the past, and many of the skills they are looking for can only be gained on the job. In a recent survey, 66 percent indicated that work experience is a crucial factor in hiring decisions and employers across nearly all sectors ranked it as one of the most important factors for recruitment.

And the past experience required to get a job has only increased in recent years as we have seen a macro trend of companies disinvesting in training.

The trouble is, if employers are looking for experience when making hiring decisions, how does someone with little or no experience convince a company to give them their first shot to prove what they are capable of?

President Obama is calling on communities and businesses to step up to address this challenge by signing onto the “First Job” Recruiting and Hiring Compact. The goal is to spread best practices that community and business leaders are already implementing to connect more out of school, out of work Opportunity Youth ages 16 to 24 to first jobs. 

Giving more young people their first step on the career ladder would have major positive returns for the economy as a whole. A 2012 study estimated that the lifetime cost to taxpayers of 6.7 million youth who were neither in school nor in work was around $1.6 trillion, which reflects lost tax revenues, higher expenditures on crime and health care, and increased social services, among other factors.

And for companies that are looking to the future, wanting to invest, grow their businesses and compete for new markets and innovation, one of the most important assets they have is their talent. Companies that have hired thousands of teens and young adults from low-income communities into their first job indicate that program graduates hired by the company enjoy much higher the retention and engagement rates than relative to their peers. Taking these steps to give young people their first job is not just good for the youth, but a smart business decision.

For Companies For communities

Ryan Burke is Senior Policy Advisor for Economic Policy & Director of TechHire.