CDFIs Are Adding a Job Quality Lens to their Advising Work — Here’s How Your Advising Program Can Too

Many community development financial institutions (CDFIs) offer capital and education to small businesses in their communities, helping entrepreneurs - especially women and people of color - start and grow their businesses. While this work is important, it could be significantly enhanced by improving the quality of jobs of their workers. A job quality lens not only elevates workers' lives, but also strengthens business resilience which can drive the deeper, long-term change that we seek for our communities.

Over the last two years, CDFIs participating in the Aspen Institute's Shared Success demonstration have integrated a focus on job quality into their advisory services. As a former business coach and program manager at a CDFI, and as someone who was new to job quality, I would like to share some practical steps for how your advising program can do the same.

But before we dive in, let's take a step back: What do we mean by job quality? When we talk about job quality, we are looking at a variety of elements that make jobs good for workers. Broadly speaking, this includes fair wages, access to benefits, opportunities for advancement, a healthy work culture, and including workers' ideas and perspectives in decision-making processes. And good jobs are also good business. As Zeynep Ton writes in "The Case for Good Jobs," improving jobs and processes that support workers can increase retention and productivity because "engaged workers are more productive, provide better service, and are less likely to jump ship." The effect of improving job quality ripples beyond the success of the business; it is an essential building block to improving economic and social equality in the very communities CDFIs strive to serve.

Through business advising, CDFIs are well positioned to support their business owner clients to see the value of investing in job quality as part of their overall business strategy. Coaches and business advisors participating in Shared Success have heard about their clients' struggles with hiring and retaining workers, especially after the COVID-19 pandemic. If this resonates with what you hear from your clients, a way to help clients navigate these challenges is by improving job quality.

The CDFIs participating in the Shared Success demonstration serve local communities across the country. While some have a track record of embedding job quality into their work, adding a job quality lens to their advising programs was new for most. Here are some strategies organizations newer to job quality are using to incorporate this lens into their work:

Learn about job quality

You don't need to be an expert to get started. Start by building your understanding of what makes a good job to identify ways your business advising program can help clients improve the quality of the jobs they offer. The new Job Quality Center of Excellence, developed by the Aspen Institute Economic Opportunities Program, has a library of resources, including case studies, research, recorded discussions, and tools that can help you build your understanding of job quality and develop a practice that fits your organization.

Adapt job quality practices to your unique context

Combine what you learn from these resources with what you already know about your clients to tailor advising practices. For example, if your clients struggle with high turnover, you can learn how improving job satisfaction - you'll be surprised by the many ways you can tailor advice to fit the business needs, leadership styles, and employee values - can be a cost-effective and practical investment for your clients. See, for example, CEI's tool that helps business owners understand the cost of turnover. The CDFIs that are part of the Shared Success demonstration have found that having a basic framework for job quality enables them to suggest business strategies aligned with their clients' unique challenges and workforce needs.

Build partnerships

Partnerships can enhance your knowledge while expanding job quality support for your clients. Consider partnering with organizations and people that specialize in job quality, human resources, state labor, or workforce support. For example, Northern Initiatives partnered with Good for Michigan to deliver job quality trainings for their clients and business advisors. Other organizations engage HR consultants in trainings and one-on-one support for their clients. Partnerships offer a practical way to enhance the resources available to your clients and allow you to gradually build your program's capacity.

Invest in your team's capacity to support business practices that make good jobs

Whether by training business advisors and coaches, engaging with knowledgeable partners, or connecting with expert consultants, investing in capacity building has helped organizations ensure that their advising can effectively guide clients on improving job quality. Capacity building includes building an understanding of what job quality looks like in your operating context and for your target clients. To do this, organizations are learning about locally relevant benchmarks for wages and benefits, as well as practices that improve workplace culture and opportunities for advancement for the businesses they support.

Embed job quality elements into existing business assessment tools

Organizations that offer one-on-one advising can include questions about employment practices as part of their initial business assessments. For example, Colorado Enterprise Fund incorporated job quality elements into its business progress assessment. By making this a part of the initial conversation, you ensure that your client sees job quality as a fundamental part of the business model, rather than an additional strain or, worse, an afterthought. Including job quality elements in your assessments also helps advisors better understand business operations and identify feasible areas for improvement.

Provide training and business peer learning opportunities

Programs that offer trainings and workshops either can design new modules or incorporate job quality elements into existing curricula. This approach fosters peer networks where small businesses can share best practices and learn from one another. Shared Success organizations facilitating group trainings, like California FarmLink's Employment Resilerator, provide a structured approach to guide clients through the process of improving job quality. If a curriculum is a tall order, your program can also offer one-time workshops. For example, Micro Enterprise Services of Oregon has invited workforce specialists to offer one-off workshops to its childcare business peer groups.

Highlight successes

As businesses start to implement job quality improvements, tracking their progress and sharing their successes will reaffirm the benefits of continuing to invest in job quality. The CDFIs that are part of the Shared Success demonstration are finding that it also encourages other businesses to follow suit. They invite these businesses to share their experiences during training sessions and workshops, as well as through client profiles in social media and newsletters.

Organizations involved in Shared Success are finding ways to leverage existing core elements of their programs - such as one-on-one advising, trainings, tools, and partners - to incorporate job quality. We are using insights gained from these CDFIs to develop a range of tools and resources designed to help you integrate job quality into your advisory work, including practical guides and resources for business coaches and small businesses. If you're looking to get started, you don't have to build your job quality capacity from scratch. The Shared Success demonstration is committed to supporting you in this journey.

September 23, 2024, marked the 30th anniversary of the creation of the CDFI fund. Created to support job creation, build businesses, and revitalize communities, CDFIs continue to chip away at some of the same barriers to economic and social equity today that persisted 30 years ago. Yes, building strong and sustainable communities involves creating jobs. But if we aim to truly revitalize communities, we must also invest in the quality of life of its workers. I encourage you to connect advancing good jobs as part of the mission and commitment you have to building strong local businesses.

Learn More

The Business Ownership Initiative at the Aspen Institute is an initiative of the Institute's Economic Opportunities Program (EOP), which advances promising strategies, policies, and ideas to help low- and moderate-income Americans connect to and thrive in a changing economy.

The Aspen Institute Economic Opportunities Program hosts a variety of discussions to advance strategies, policies, and ideas to help low- and moderate-income people thrive in a changing economy. To learn about upcoming events and webinars, join our mailing list and follow us on social media.

Public link

Please use the above public link if you want to share this noodl on another website.