Putting Inner Cities To Work (cont.)

As America develops new strategies to sustain its global economic strength, the focus is shifting to the ability to lead through innovation and technological superiority. In the 21st century, America’s ability to continuously reinvent its competitiveness will depend on its success in deploying internal resources – particularly human resources – more effectively, rather than seeking low-cost manufacturing or service bases globally. In these circumstances, underemployed or unemployed inner city populations will be a valuable energy source for driving the economic engine.

Making it work

The challenge lies in recognizing the potential of America’s inner cities and overcoming the myths that cloud their image. According to an ICIC survey in 2004, perceptions about the level of crime in inner cities are much higher than actual crime levels. Similarly, the experiences of many companies repeatedly have shown that rather than being a liability, inner city workers are some of the most loyal, motivated and driven employees a company can hire.

Businesses that set up shop in inner cities quickly recognize the hidden asset that their local workforce represents. A survey of the 2005 ICIC - Inc.Magazine Inner City 100, a national annual ranking of the country’s fastest-growing inner city companies, revealed that inner city residents hold more than 40 percent of the 14,000 jobs in the 2005 Inner City 100 companies.When asked to list the top competitive advantage that these companies enjoyed because of their location, the response was unequivocal: access to a diverse and available workforce.

The Inner City 100 companies are some of America’s highest-growth corporate entities. On average, the companies on the 2005 list grew by 827 percent between 1999 and 2003 with a compound annual growth rate of 67 percent. Together, they generated over $2.2 billion in annual revenue. They choose to hire inner city residents because it makes business sense to do so. A close look at some of the Inner City 100 companies over the last seven years reveals that these companies have developed smart strategies to get the best out of their inner city workforces. Consider the following examples.

Managing retention

Employees at the architectural woodwork firm Ameriscan Designs in Chicago, Ill., work in a multi-lingual work environment.

For Chicago-based Ameriscan Designs, a custom woodworking and cabinetry business, finding skilled workers can be difficult, so the company works hard at retaining its employees by using a mix of skills training, salary increases and promotions.

Most employees at the entry level come in as floor sweepers. Those who show a desire to advance and a willingness to work hard are quickly moved up. First, entry-level employees are paired with more experienced employees for on-the-job training, and are required to work their way through a checklist of formal skills. At every stage, employees know exactly the raise or promotion that goes along with the acquisition of a specific skill set.

The net result: The company hires low-skilled inner city employees at $7 per hour for jobs like floor sweeping and soon has the most successful employees working at highly skilled woodworking jobs (such as cabinetmakers and installers) that pay $30 per hour.

Financial stability

Brightside Academy is the largest daycare provider in Pittsburgh. Like any other child care provider, the company cannot afford to have unstable employees in its centers. Realizing that employee stability is linked to personal financial stability, CEO Harold Lewis began a concerted effort to help employees gain financial security through programs such as no-interest loans, free checking and home ownership assistance.

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