The New York Times: Google Creates $100 Million Fund for Skills Training Program
Social Finance in the News
Excerpted from The New York Times
Google said on Thursday that it was creating a $100 million fund to sponsor an ambitious project to expand effective skills training and job placement programs for low-income Americans.
The Google-backed initiative is targeting a big problem: how to find, train and create paths to good jobs in the modern economy for the nearly two-thirds of American workers who do not have a four-year college degree.
“I genuinely think this is one of the important areas for society to figure out,” said Sundar Pichai, the chief executive of Google’s parent company, Alphabet, in an interview. If the project is successful, Mr. Pichai said, he hopes it will be a “template for other companies to do more” and show policymakers that there are better-performing alternatives to traditional government training efforts.
The tech giant is working with three nonprofit groups on the effort: Year Up, which focuses on upward mobility programs for the disadvantaged; Merit America, an organization that offers tech training programs for adults without a bachelor’s degree; and Social Finance, which designs student-friendly financing and repayment plans.
The training organizations are paid a portion of their costs upfront and receive additional payments only if their graduates land and keep higher-paying jobs. The program will combine Google philanthropy with loan repayments from students. The loans will carry no interest, and students will begin repaying only if they get a job that pays at least $40,000 a year. The payments will be about $100 a month and continue for a maximum of five years.