As part of their CDFI Futures series, Next City dove into the impact of LISC’s Financial Opportunity Center (FOC) and Bridges to Career Opportunity (BCO) models. More than 100 FOCs, in 26 states, combine job placement, financial coaching and financial supports to improve peoples’ long-term economic prospects. Katrin Sirje Kärk, LISC’s director of Workforce Innovations describes how the program promotes clients’ lifelong goals: LISC and the coaches, she says, “are committed to being there for as long as needed.”
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LISC Moves the Needle on Jobs and Poverty with Financial Opportunity Centers
By Frances McMorris, Next City
For years, job placement for the chronically under- or unemployed was the go-to remedy for addressing poverty. However, in the last 15 years, the Local Initiatives Support Corporation (LISC) has expanded the scope of its workforce development programs to improve the long-term economic prospects of low-income, disadvantaged and underserved people and communities throughout the United States. LISC, one of the largest non-profit Community Development Financial Institutions (CDFIs) in the country, has done so by supporting financial opportunity centers.
LISC officials found that helping someone find a job wasn’t quite enough, says Katrin Sirje Kärk, LISC’s Director of Workforce Innovations. “Oftentimes the jobs were lower wages, and didn’t have benefits and had schedule volatility,” she says. Federal funding sources emphasized the work first. “Get someone into a job and that will address poverty and solve everything, which it did not.”
The financial opportunity center model combines job placement, financial coaching and financial supports. Early on, these aspects of the program were separated. But the preponderance of low-wage jobs was a challenge. Even after receiving financial coaching, an individual may stumble on the path to wealth building when falling victim to check-cashing fees and predatory loans, Kärk says. After growing the number of FOC sites over several years, LISC and its partners realized just how important credit had become for their clients — important to secure a fairly priced loan, and critical to obtaining more stable rental housing and jobs.
LISC’s Bridges to Career Opportunities (Bridges) program offers training and other financial education and help to chronically unemployed and underemployed adults. The Citi Foundation, a major supporter of the Bridges program, has committed $10 million to help 40 financial opportunity center partners in 19 cities over the last three years. (Editor’s Note: Citi Foundation is also a funder of Next City.) Through Bridges, participants work with LISC’s network of financial opportunity centers to improve their literacy and math skills, get financial coaching and technical training, and even earn industry certifications.