Our economy continues to recover from the worst downturn in our lifetimes – we’ve created over 15.3 million new jobs since job growth turned positive in 2010; the unemployment rate has been cut in half to five percent; and wages rose more last year than in any previous year on record. But the President knows that we still have work to do ensure that the gains of this rates than they did before the crisis. But unemployment rates for young people – and in particular, young people of color – are still far higher than they should be.
When a young person fails to get onto that first rung of the employment ladder it can set her back for a lifetime. Studies show that people who endure a spell of unemployment between the ages of 16 and 24 earn $400,000 less over their careers.
So it’s critical that we help these individuals find jobs. Besides a steady paycheck, a lot of important ‘firsts’ can come from a first job. For some young people, it is the first time an authority figure sets high expectations for them, the first time they cannot get away with being late, or the first time they demonstrate their capabilities to a mentor who helps them get ahead.
That’s why, earlier this year, the Administration proposed significant new investments to get young people into year-round and summer jobs. And the President called on businesses to play their part, by giving young people with limited resumes a better shot in the hiring process by providing internships, training, mentoring, and job interviews.
Companies around the country have stepped up. Today, we are announcing that nearly 40 of the nation’s largest employers – in addition to hundreds of small- and medium-sized companies – have signed onto the White House #FirstJob Compact. The Compact memorializes a set of best practices for recruiting, hiring, and retaining out-of-work, out-of-school young people aged 16 to 24—our nation’s Opportunity Youth. The My Brother’s Keeper Alliance, a nonprofit dedicated to creating pathways to success for boys and young men of color, will work with companies that have signed onto the #FirstJob Compact to help them execute their commitments, track progress, and share lessons learned.
These businesses will benefit too: companies that have hired Opportunity Youth report that they have higher retention rates and employee engagement than their peers. That matters because on average, companies face turnover costs of about $2,000 for an entry-level employee; and annual turnover rates can exceed 50 percent for entry-level employees in some sectors.
We are continuing to call on companies to sign onto the #FirstJob Compact. More information on how to do so can be found here.
Here’s some of what we’ve heard from companies and youth about the impact these practices have had on them and their organizations:
“Programs like this help us to have a real and meaningful impact on the communities where we live and work. Together, we can create additional opportunities for young people to get a start in the workforce, while inspiring our current and future employees to drive their own growth and careers.” - Ajay Banga, President and CEO, Mastercard
“We are proud that over half of our new associates each year are young people, providing an amazing talent pool that can grow with us and become our future leaders. We’re committed to providing our entry-level associates with expanded training and clear career pathways so they know what is expected of them to grow, develop and get ahead.” - Doug Mcmillon, CEO, Wal-Mart Stores, Inc.
“A first job can truly be life-changing, and we've seen countless examples of how someone can build their confidence, their skills and ultimately a fulfilling life if they are set on the right track in the beginning. It's incredibly inspiring to see someone who joined us in an entry-level position one day rise to the highest levels. Many of the most serious issues facing our nation and our world can be addressed by ensuring millions of young people receive the right opportunities when they are just starting out, and businesses like Hilton are very fortunate to benefit from their energy, passion and drive." - Christopher J. Nassetta, President & CEO, Hilton Worldwide
“If you were one minute late to This Way Ahead job training you had to go home. I’m used to being a little late and getting away with it. The internship helped me realize that if I wasn’t serious about my commitments, no one was going to take me seriously.” - Darius, This Way Ahead graduate
“YouthBuild helped me grow in areas I didn’t know I needed to grow in. They went over and beyond to make sure that everyone can achieve the goals I set for myself.” - Antwain, YouthBuild graduate
“The neighborhood I grew up in was extremely violent. I could have become a statistic, but I wanted something bigger than that. Year Up changed my perspective and boosted my confidence. Setting aside stereotypes and odds about young black men, we all have the same 24 hours each day. What separates us is what we choose to do with them. I’ve chosen to do something.” - Le’Sean, Year Up graduate