Arriving Refugees Boost US Government Revenues

Posted by Terrence Isert, September 20, 2017

A draft US Health and Human Services report quantified a net positive boost to the US government coffers from newly arrived refugees. As reported in the NY Times, the study analyzing economic cost of refugee resettlement programs versus the cost of admitting them over a 10-year period from 2005 – 2014. The initial findings found a $63 billion net positive increase to US government revenues. The draft report can be found here.

Minority-Owned Business on the Rise

Posted by Terrence Isert on July 26, 2017

The 2017 annual U.S. Census of Survey of Entrepreneurs shows an increase in minority-owned businesses. Both payrolls and employment of minority-owned employers grew by nearly 5% over the period of 2014 to 2015. Women-owned firms grew annually be 3.0% over the same period. Not surprisingly, the highly-populated Mid-Atlantic/New England metropolitan areas and California accounted for a large share of the growth. Read more here.

Responding to Refugees: Here and Abroad

Posted on May 10, 2017 by Terrence Isert

Interesting news highlighted in an op-ed by Senators Corker and Coons with regards to a new Food for Peace Reform Act. The legislation, originally submitted in 2015 and resubmitted depicts one of many critical needs for refugee support services in international settings such as the developing famine crisis in Sudan.  Beyond basic needs of food and shelter, refugees resettled in the U.S. require a variety of psycho-social, education, health care and economic development services. These services help speed up the process of assimilation which in turn can provide economic benefits both to these new American households but also to their newly adopted communities.

Are Trade Deals Good for the American Worker?

An Article from Politico on the intertwined NAFTA and TPP

Posted by Terrence Isert, March 7, 2017

Help or hindrance? At ProMicro Consulting, I’ve thinking a lot about the recent national discussions around trade deals and the popular conception that free trade hurts American manufacturing workers and jobs A recent arti. is recent article in Politico juxtaposes criticisms and advantages of the recently rejected TPP as a pathway to a better NAFTA.  Much has been made of the manufacturing job losses totaling 5 million since 2000. However, manufacturing have seen a recent uptick of 800,000 jobs in the period of 2010 to 2014. This number is significant in that some economists have quantified this amount as the number of manufacturing jobs shipped to our trading partners, particularly Mexico.

The story of free trade and jobs runs deeper than that however.

The economics of these trade deals are tricky and in this case interwoven more with trade deficits, the Great Recession, the pace of manufacturing outputs and politics in the US. According to the US Census, the trade deficit alone ballooned since 2000  (30.2B, March) to 2017 (48.3B, January figures) according to the at least indirectly affecting industries such as manufacturing. NAFTA was always manufacturing and agriculture-heavy in its focus, the former losing 5 million jobs since 2000(see EPI article) although a modest rebound of 800,000 jobs has occurred since 2010. By comparison the TPP was focused more heavily on service industries where the US has a large trade surplus even with Mexico. The new trade deal under TPP was designed to address some of the labor-protection issues, open up access to new markets (dairy industry in Canada) and insert environmental measures missing from NAFTA.

What is clear is that the US missed an opportunity to update a trade deal with its North American partners to improve its trading relationships benefiting more American workers and an opportunity for broader and deeper access to new and existing Asian markets. Those deals may be harder to strike unilaterally and now less favorable to US jobs and its economy.

Four Takeaways for Future Food Security in a Changing Climate

Posted by Terrence Isert, February 9, 2017

How does the world adapt its agricultural practices given the uncertainty of what has become an increasingly unpredictable set of weather patters across the globe? What are the key impacts and adaptations? Who should be involved in decision-making? Devex reports on a presentation by Emmy Simmons, a Senior Advisor to the Center for Strategic and International Studies on changing climate and agricultural impacts on future food security. Read more here.

Rebuilding Urban Communities: Light it Up

Posted by Terrence Isert, January 10, 2017

When it comes to rejuvenating an urban community, expert opinions will often cite a variety of political, social and economic ills that range from the need for education reforms, infrastructure investments, improved racial equality and political reforms among many critical leverage points. Adding citing lighting is not something that leapst to mind. however Detroit has accomplished a milestone on its way to its goal of urban revitalization by doing just that. Read more about the city of Detroit’s latest success here.

Cash Grants instead of Welfare?

Posted by Terrence Isert, January 4, 2017

Is there a more efficient safety net delivery channel than the current welfare state in the US. A recent article by Richard Barlow of Cognescenti argues for just such a model. He cites the effectiveness of Brazilian model however there are tradeoffs. The US is not Brazil. One study calculates current welfare packages that include state and federal aid that provide a median of $29,000 in benefits compared to the $10,000 in cash per person that the author proposes. Is this a feasible fix or a voucher system in disguise?

EDA Awards Entrepreneurship and Innovation Grants for Growth

posted by Terrence Isert, December 6, 2016.

The US EDA awarded $15 million in entrepreneurship and innovation in 19 states throughout the US. Perhaps most notable is the concept that through these grants economic inclusion is not only fostered but considered essential to promote economic growth and more importantly, community stability and resilience to build foundations for future prosperity. Read more here.

Book Review: In their Own Hands by Jeff Ashe and Kyla Neilan

Posted by Terrence Isert, April 16, 2015

The idea that poor people and their families can save anything meaningful seems as ludicrous as the assumption by Muhammed Yunus in 1976 (Price of Dream) that small amounts of credit could help build poor families start businesses in Bangladesh. Jeff Ashe and Kyla Neilan’s In Their Own Hands demonstrates both. In fact, the poor can do so effectively, on their own and with little to no outside help – a departure from the approach of the microfinance movement. When NGOs train participants and then “get out of their way” — these rural and urban groups perform best. Women and men in each group manage themselves and their money more effectively than constant NGO-interaction or supervision.  The savings group movement enables not only the poor but the very poor to do what they could not do before: save first, then borrow from each other and continue the process over and over again without help from the outside.

Mr. Ashe’s chronicles his own personal journey from the Peace Corps volunteer forming solidarity groups in Guatemala to microfinance practitioner in Boston. He admits his own misgivings with the micro-lending movement (see this 2007 SSIR article here) and its microfinance institution-building efforts in the 1990s. He poignantly tells of his own sartorial discovery of these groups thriving in Nepal and his own efforts afterwards to launch them in some of the harshest climatic, economic and political environments across Africa and Latin America.

The novel is a compelling read for anyone interested in exploring a poverty-reduction model that is easily scalable, highly-efficient, low-cost to implement and teaches people and their communities to help themselves by putting the power of choice in their own hands.

Youth Choices: What Influences Them and What’s Important

Pathways for Sustainable Jobs and Enterprises

Posted on October 5, 2014 by Terrence Isert

What is needed to predict where and how youth will succeed in either a new job or enterprise?

How are markets and market opportunities identified? Do youth weigh the risks of each or use different criteria to make their decisions? Some recent research sheds some light on the importance of understanding the factors that can influence youth and ultimately impact their entrepreneurship choices. Factors include both external and internal considerations. Youth need social supports, accessible markets, and useful programs from institutions (schools, training, etc.).  Some of the most important internal factors for youth highlight their needs, attitudes, personality traits and preferences. All of these factors form part of larger framework for youth to succeed in any job or enterprise they choose.

 

Internal Factors

Cognitive and non-cognitive abilities are internal factors that play important roles in predicting youth success. Cognitive abilities or intelligence have been studied more frequently. They relate well to achievement levels in school, future wage earning, and a range of social behaviors. One study (Journal of Labor Economics, 2006) illustrated the significance of non-cognitive abilities and their impact on youth decision-making. Non-cognitive abilities such as personal preference and personality traits on economic and social behavior have been studied less.  These abilities also have an important influence school, future earnings and employment. Traits such as charm, persistence, motivation for example are undeniably important factors that influence future success in attaining work or creating a business.

 

External Factors

What could be considered by some to be out of youth’s sphere of control are conditions equally necessary for success at job and enterprise creation. An effective way to classify these is with the Capability Framework (Sen 1992, 1999) which identifies three categories: institutional, social and material conditions. Government policies for example create (institutional) support for new employment opportunities. Communities valuing youth savings groups and earning potential are just two examples of shifting social support to youth.  Various life and skills training programs highlight how schools (institutional) can partner with communities (social) to provide new opportunities for youth. Families and households can also be a rich source of (material) resources, even moral support (material conditions) to promote youth businesses. NGO programs that mitigate obstacles to these external factors help youth succeed.  Youth can then focus on developing good decision-making, confidence and other “soft” skills to increase their chances for success.

A Final Word: Poverty Alleviation versus Business Development

Goals and outcomes of entrepreneurship programs are directly influenced by choices as to “who and how” to target.  Necessity entrepreneurship and opportunity entrepreneurship as defined by USAID speak to the end game of a typical youth enterprise development program.  Which one is yours? The former has a goal of poverty alleviation. It promotes microenterprise and livelihood opportunities as a way for young people to gain revenue through an income-generating activity or microenterprise creation to escape from poverty. The latter makes the assumptions that youth are sufficiently motivated, that they have no constraints on their choices and that they already operate an enterprise. With sufficient skill sets and training, youth will be positioned to grow their existing businesses.  It presupposes at some level that conditions are supportive and that any obstacles or constraints for economic growth can be overcome.

 

Why is this important? Some programs may confuse activities that support existing businesses with poverty alleviation and therefore attempt to move necessity entrepreneurs away from livelihood activities and into riskier endeavors. Conversely, business development may not provide poverty alleviation in a given community or region. However it may be a very effective strategy for helping a few youth expand their business or employment opportunities.  Therefore, it’s essential to survey youth to gain a thorough understanding of their socio-economic profiles, their varied personal traits and preferences, and the context. Armed with these external and internal factors, supportive programming can be constructed around youth to meet their varied needs and guide them to successful development.