Posted: 18 Sep 2016 09:00 PM PDT
Blogger Note: One FOC is located here in Mesa @ La Mesita
An independent study has found that Financial Opportunity Center clients, who access a range of services, have more success meeting their financial goals than people in programs offering employment assistance alone. Their gains include landing and keeping a job, growing credit and increasing annual earnings. The research findings will help LISC refine and propel its financial stability work on behalf of low-income Americans.
. . . we have promising new evidence that this strategy works: An independent study by the Economic Mobility Corporation (Mobility) has found that FOC participants have greater success in meeting their financial goals than do people in programs offering employment assistance alone.
Mapping a Road to Financial Wellbeing
Summary of the Mobility study
Complicated financial picture Beyond the statistically compelling findings of the study, there are more nuanced lessons to be drawn.
After program entry, for instance, FOC participants’ earnings increased, but financial support from family and friends decreased, as did reliance on unemployment benefits. At the same time, they spent more on basics like rent, utilities and food. So while clients did not experience significant changes in their net incomes, we can see that this is due, in part, to the fact that their expenses before program entry were artificially low. The evaluation also pointed up the challenges clients face in an unpredictable and shifting financial situation. The evidence shows us that they can and do make progress towards financial health by stabilizing their credit and employment, but there is only so much they can do without wage growth. For most FOC clients, poverty hasn’t taken root overnight and it doesn’t get eradicated quickly, either. While Mobility’s findings are extremely encouraging, and tell us we’re backing the right approach, they also suggest that two years is too little to show dramatic changes. And while job retention is crucial, wages for workers with minimal or newly acquired skills are usually too low to bump them out of privation and onto a financial cushion right away. As the study’s authors write, “Given the FOC participants’ limited recent attachment to the labor market, lack of assets, and level of debt when they entered the programs, it is not surprising that helping them achieve financial security and mobility requires a long-term strategy.” Looking ahead Clients need to be engaged and coached over the long term, and that requires on-going policy and funding support for bundled service strategies like FOCs. Clients also need access to higher quality jobs: higher wages, better benefits, steady employment and opportunities for advancement. We will shore up this approach with our Bridges to Career Opportunities program, which connects FOC participants to education, better jobs and greater economic opportunities. The study results demonstrate that, with the right tools, people can take the small, determined steps that turn into solid financial footing.
You can find all the details here
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