Eight out of 10 were founded in the past five years.
New Investments in Racial Economic Equity
A post-2020 investment surge spurs innovative approaches to driving economic advancement for Black Americans.
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Table of Contents
An Opportunity for Truly Transformative Change
George Floyd. Breonna Taylor. Ahmaud Arbery. Those are just a few of the people whose names the nation has come to know because they were victims of racial violence in 2020. The killings of these and other Black Americans sparked the largest racial justice protests in the United States since the civil rights movement. Meanwhile, the COVID-19 pandemic made it clear that it was time to examine the ways systemic racism fuels economic inequality and poor public health outcomes for Black people in our country.
Corporations, foundations, and philanthropists responded to that call, committing at least $50 billion to address social injustice and racial inequities. At Jobs for the Future (JFF), as part of our mission to drive equitable economic advancement for all, we redoubled our commitment to achieving racial economic equity, with a particular focus on Black learners and workers. We were excited by the opportunities for truly transformative change that this new outpouring of resources could unlock and eager to identify ways in which we and others across the education and workforce fields could support the organizations taking on this vital work.
In this market scan, we sought to identify organizations that might now have the resources to pursue new strategies—or dramatically expand existing ones—to advance racial economic equity. We focused on the two key approaches we recommend in our Purpose-Built Call to Action: Achieving Black Economic Equity: ending occupational segregation and eradicating the racial wealth gap.
Understanding the Landscape
We started our research by collecting data on public financial pledges and other commitments of resources that corporations and other funders have made since June 2020. We then traced the paths of these investments to identify the organizations that are receiving those funds, with a specific focus on organizations working in JFF’s areas of expertise in the education, workforce, and economic development sectors.
We initially found new or renewed public commitments by more than 260 companies, foundations, and other organizations totaling nearly $44 billion from June 2020 through the spring of 2022. We then closely reviewed more than 110 funders that had made total pledges of $5 million or more each, aiming, where possible, to identify beneficiaries and understand investment goals.
The result was a data set that included more than 300 grants, investments, and other pledges of support for efforts to transform education and workforce systems in pursuit of racial economic equity from more than 40 funders. The combined total value of those commitments was about $1.23 billion.
Innovators to Watch
Our research led us to identify a select group of Innovators to Watch. These organizations are at the leading edge of market trends in the effort to advance racial economic equity, and they distinguish themselves from other forward-looking companies by their potential to create significant business-aligned social impact.
Here are eight characteristics of our Innovators to Watch:
Each of these organizations offers a potentially transformative innovation or is led by inspiring founders and teams that we believe in.
Trends to Watch
- Funders are creatively deploying a full suite of resources. We’re seeing funders commit to this work in many ways, sharing human capital and other valuable resources as well as financial capital.
- HBCUs are at the vanguard. Historically Black colleges and universities, despite decades of government disinvestment, have helped catalyze advances in Black communities for more than 100 years. According to one study, the number of startups led by Black women with undergraduate degrees from Howard University exceeds the number of startups led by Black women with undergraduate degrees from Harvard University.
- Hometown organizations are attracting attention. We also noticed that funders are giving to local organizations, probably because they want to connect with partners that serve their communities. For example, the Amgen Foundation has directed its giving to organizations in areas where Amgen has a significant presence.
- Networks and coalitions with the potential for nationwide impact are also benefiting from new investments. In the education sector, examples include initiatives that are designed to benefit learners at multiple postsecondary institutions, such as the Student Freedom Initiative and HBCU C2 at Tennessee State University, a program that empowers all HBCUs to bring coding and creativity (C2) programs to their campuses and communities.
Opportunities for Future Innovation and Investment
Programs that seek to increase investments in Black business owners and emphasize expanding the share of those investments that come in the form of equity capital.
Such efforts can help build stability and wealth in Black communities. Because Black-owned businesses are more likely to be located in and hire residents of Black communities, investments in Black-owned businesses create opportunities for Black workers to get jobs close to home, which increases the likelihood that the dollars they earn will be reinvested in the form of increased sales for local businesses and increased tax revenue.
Robust collection and analysis of data related to the outcomes of investments.
High-quality, regularly updated data enables stakeholders involved in efforts to advance racial economic equity to identify opportunities to strengthen impact. We also see value in gathering and sharing feedback from the people and organizations that benefit from investments.
Initiatives that focus on long-term outcomes.
Stakeholders will be more likely to develop lasting holistic solutions if they take the long view of success. For example, a long-term outlook will help ensure that an effort to end occupational segregation includes not only immediate education and training opportunities for participants but also services to help them find jobs and advance in their careers.
Funding strategies that ensure that recipient organizations are prepared—and have the support they need to take full advantage of their newly available resources.
While funders might want to make a big impact right away, it may be more advantageous in the long run to give the recipients time to organize their resources and prepare budgets that incorporate the new funding.
Investments in structural changes to maintain a focus on racial economic equity despite ebbs and flows in public attention.
Dismantling systemic racism requires extensive forethought and planning, and sustainable wins won’t materialize through a one-time wave of philanthropy alone, especially if long-standing policies and frameworks go unaddressed.
Driven to action during the racial reckoning of 2020, Jobs for the Future (JFF) launched the Racial Economic Equity Initiative with the goal of accelerating Black economic advancement.
Motivated by ongoing education and economic disparities experienced by Black learners and workers, we seek to create a world where race is no longer a determinant of education and economic outcomes—a world where Black learners and workers secure quality jobs in high-growth sectors, succeed in their careers, and experience economic advancement.
We aim to identify solutions and best practices to achieve two foundational priorities: disrupt occupational segregation and eradicate the Black-white wealth gap. JFF's Center for Racial Economic Equity does this through research, thought leadership, network building, and advisory services.
Achieving Black Economic Equity
Eliminating the economic barriers facing Black Americans will require bold, race-conscious solutions that touch every facet of U.S. society.
Building Professional Social Capital for Black Learners and Workers
Mapping the landscape of programs specifically designed to help Black learners and workers build professional social capital.
Purpose-Built to Advance Equity
JFFLabs features solutions for Black advancement within tech careers, including a commitment to transforming the systems in which we all learn and work.
Accelerating Black Economic Advancement
JFF aims to identify and scale strategies to disrupt occupational segregation and eradicate the Black-white wealth gap.