Nonprofits have always been asked to calculate their cost savings, their financial savings, or their economic impact by creating a Social Return on Investments (SROI). These calculations are complex, and so the Sundance Family Foundation with the help of Ecotone Analytics, set about trying to discover the SROI on it’s new Earn and Learn program by the 2020 grantees.

For every $1 contributed to an Earn & Learn program, there is a projected $3.50 social return on investment (SROI). Over a 3-5 year period of time this return is accrued to participating youth, society, employers and taxpayers in different ways. However, it all results in either additional revenue or projected savings. Ecotone’s process of developing an SROI analyzes and combines the data of the Earn & Learn grantees with external literature to project the potential value of an organization’s impact while identifying the people and entities to whom the benefits accrue.

The first step is to monetize the outcomes which includes:

  • Increased earnings and fringe benefits associated with those earnings (e.g. health care, PTO, etc.) for young adults when they land their first employment placement and when they reach middle skills careers in 3-5 years
  • Improved Mental and Emotional Health / Reduced substance use by youth
  • Reduced use of Public Assistance by youth
  • Foregone earnings from program participation for youth
  • Increased job retention / reduced hiring costs for employers
  • Reduced recidivism / justice involvement for youth

The SROI can be difficult to compare across organizations, particularly in different sectors. Yet, it can help to identify and try to measure those aspects of the program that can be managed to maximize impact. Trying to create an SROI for a group of organizations helping a group of young adults helps identify the key individual level indicators that signal impact and that can be tracked across participating Earn and Learn organizations.

For example, key indicators include:

  • Annual increase in earnings
  • Proportion of youth receiving benefits with their job
  • Cost of hiring for employer
  • Increased job retention

Tracking key metrics gives meaning to philanthropic evaluation of programs: are we really getting a return for the dollars invested in the community as so many donors are prone to ask. A more important question is: are we doing good; are young adults getting trained, hired and ultimately getting into careers that can sustain their families.

The Sundance Earn & Learn program is still in the early stages of development. Many outcome targets are currently uncertain given the effects of COVID-19 on the number of youth potentially served. While initial data was drawn from grant applications, future data will be drawn from employers and other cross-sector partners to help the collective understanding changes which must be made to help youth success.

The current Earn and Learn career pathway includes: 1) career exploration, 2) social/emotional support to enhance youth personal agency, 3) community engagement to enhance youth social capital and connectedness, 4) mentoring and internships, 5) short term skills-training which result in a nationally  recognized certificate or two year degree, 6) job placement, 7) on-the-job training through apprenticeships, and 8) job-retention supports. Job-retention supports include access to crisis funds, transportation, and a path to a middle-skills career.

Sundance is using both the SROI measurements and the United Nations Sustainable Development Goals as its framework for capturing data. This data should help us know if we are successfully moving more youth, particularly youth from low-income communities and youth from communities of color into meaningful and sustainable careers.

Social Impact ROI for Earn and Learn

Fig 1. The Sundance Earn and Learn grantees reported in May 2020 that their average cost per youth or young adult is $7,600 with an estimated return of $26,400. This includes the increase for youth from an average minimum wage of $21,000 to an entry-level wage of $35,000 (plus an increase in benefits) with a pathway to a wage of $50,000-$73,000 per year. Benefits go to many entities including federal and state taxpayers as a result of the increased taxes provided. The employer saves money in several areas including personnel recruitment. Society benefits with reduced costs for services, corrections. This analysis is available in the Technical Documentation document which can be downloaded on the Sundance Earn and Learn page.

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