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Closing the Skills Gap: Chase Launches $75 Million Career Training Initiative

In recent years, “the skills gap”-that is, the gap between the skills employers need and those that young workers bring to the table-has grown wider. It’s a trend that threatens to leave many promising young workers behind.

But what if we invested in those young workers to give them the training they need to compete for jobs in today’s global marketplace? The $75 million “New Skills for Youth” career readiness initiative, spearheaded by JPMorgan Chase, aims to do just that.

“Economic opportunity is increasingly out of reach for millions of young people,” Chase Chairman and CEO Jamie Dimon explains in a news release. “It is a crisis that only 60% of students in high-poverty urban school districts graduate from high school and that more than five million young people are out of work and school. Without the right skills or education, they find themselves stuck in low-skill, low-wage jobs or unemployed. We are in investing in high-quality career-focused education programs so that more young people have a shot at real economic opportunity.”

According to Chase, “1 out of 3 American companies have openings for which they can’t find qualified workers.” At the same time, there are an estimated 5.5 million young people, aged 16-24, who are neither working nor in school, with youth unemployment at 11% overall. Among young African Americans, that number rockets to and 22%.

That divide suggests that expanding access to quality career education programs, to provide the technical and professional skills today’s marketplace demands, would be a win-win for both workers and employers, as well as for the U.S. economy at large.

It’s against that backdrop that the New Skills for Youth initiative was launched. Chase developed the concept as a way to expand access to career pathway programs for young workers.

In a recent USA Today op-ed, Dimon and Freeman Hrabowski, president of the University of Maryland in Baltimore County, make the case that the education and corporate sectors need to work in concert to bridge the skills gap.

“Educators need to recognize that businesses have a high demand for skilled workers, whether they’re robotics technicians or licensed practical nurses, and better align what they teach with the skills employers desperately need,” Dimon and Hrabowski write. “Likewise, business leaders need to support the education system as it strives to teach today’s skills and help students develop into critical thinkers and life-long learners. Many students who start on a technical training path will have opportunities to go on to earn four-year degrees in the years to come.”

The New Skills for Youth initiative has two key components. First, Chase is working with the Council of Chief State School Officers and the National Association of State Directors of Career Technical Education Consortium on a nationwide grant program encouraging states to design and implement new career training programs. Information on how to apply is at http://www.ccsso.org/Resources/Programs/Career_Readiness_Initiative.html.

The first phase of grants, totaling $2.5 million announced at the end of March, was secured by twenty-four states and the District of Columbia. The grants allow the states to, “develop detailed career readiness action plans, which are an essential step to expanding economic opportunity for young people.”

Ohio Interim State Superintendent, Lonny Rivera stated upon receiving the grant, “It’s more important than ever that students receive a career-focused education. We’re excited to catapult our initial groundwork to an innovative and bold level where students are engaged and excited about learning, ultimately leading to a seamless transition to college and careers.”

The initiative’s second prong provides targeted investments in career-training programs. Chase says the goals will be “to increase the number of students, especially low-income young people, who earn meaningful postsecondary and workforce credentials. Effective programs will be aligned with the needs of emerging industries that are looking for skilled workers to fill good-paying jobs in the growing global economy.”

Communities that received Phase One grants are now also eligible to apply for Phase Two grants in the fall of 2016 where states will receive up to $2 million over three years to implement the plans they developed in Phase One.

By tracking the successes and shortcomings of these programs, Chase seeks to identify workable models for career training and education that can be implemented in other environments.

As a leader in the financial industry, Chase recognizes that a strong economy requires expanding opportunities for everyone. Particularly in a time of slow global growth, it’s critical that the private and public sectors work together to address the skills gap and help young workers prepare for the jobs of today and tomorrow. The New Skills for Youth initiative is one promising start toward addressing the skills gap.

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