Friday, October 17, 2014

Jobs vs Job training: Meet People Where They Are

I remember President Clinton giving one of his incredibly convincing speeches about boosting the economy, world trade, and transitioning screwed middle class workers from good jobs to theoretically better jobs if we just had this one thing: training.

So we funded a lot of training, largely focused on tech. Tech was gonna save everything. And then the market collapsed in 2000 and we hit the recession, and no amount of training would create new jobs for everyone getting training.

Training is important. Some people really thrive with it--they hit the classroom, hit the books, get first-hand exposure to new equipment, machinery, and technology, and companies hire them right after completion of the course or degree.

Yet manufacturers around here complain that they can't get enough skilled workers. And this is for "good" jobs, with pay starting at $18/hr and higher.

Yet we have relatively high unemployment, and the city sports a high poverty rate and a higher near-poverty rate, making up 75% of its residents.

So how is this possible? Training is available, the jobs are available, so why the high unemployment, poverty, and unfilled jobs?

It's because both the training and the jobs require an existing platform of skills and education, and that's where the gap is. If someone hasn't finished high school, or finished but isn't literate (how is it possible that SDOL graduates 82% of seniors, yet 50% aren't proficient at reading and math?), they won't get through the training if they're even admitted to the program.

If the goal is to employ people, you have to meet them where they are. We definitely have a lot of talented people getting solid jobs in local manufacturing; something like a gagillion percent of Stevens College graduates land jobs before they even graduate, with high starting pay.

But we have a significant number of neighbors who don't have that basic foundation of education and skill. And it's unlikely--not impossible, but unlikely--that they'll get there.

So what to do?

You have to meet them where they are. We need to create demand for products and services that require little skill or education, but that also pay well. That's what we're trying hard to do at The Lancaster Food Company. We have a relatively high entry wage & benefits, and anyone who can lift 50 lbs and learn parts of the production can apply.

What other businesses could create demand for low-skilled labor? Or where skills could be developed? It could be service work, furniture production, bookbinding, composting--many, many types. The key is not to chase cheap labor overseas and keep these types of jobs here.

But what's missing are the businesses--new ones and existing--focused on creating demand for those kinds of jobs. We're hoping to see more businesses that build their model around ethical wages and unskilled or low-skilled labor.

That's how we'll end poverty in the city as we know it, and that's how we'll get the unemployment rate down. It will reduce crime, improve housing, and improve education. It will take 15 to 20 years for the full effect, but the immediate effect will be felt in the families of those that get the jobs, the place they live, and the places they shop.

Clinton was right, but he was wrong about the universal impact of training; it's good for some people, but for others, you have to meet them where they are.

Monday, October 13, 2014

Market Wages are not Ethical Wages

The daily post (if days are measured in months).

I've been thinking a lot about what "fair" means when it comes to fair wages. What's a fair wage? Market rate? The market will pay the lowest it can--it seeks efficiencies. It doesn't seek humanity, dignity, fairness, justice, equity--just the lowest price for the commodity.

So market wages are not ethical wages. To me, anything under a living wage is unethical. You ask someone to come work for you for 8 or 9 hours, and pay them lower than what it takes to pay for housing, utilities food, transportation, and healthcare. They aren't able to save, and are still underwater when it comes to the bills. Yet you're profiting from their labor. To me, that's unethical.

Paying higher than a living wage gives the person a chance to save, and to hand their time over to you without needing a second job to make ends meet. Second jobs aren't the worst thing in the world, but if someone is working 16 hours to make ends meet, someone's not paying them a living wage.

People who pay market wages do so because they can, and they rationalize it by saying that others are nuts if they pay any more than they have to.

I don't see it that way. If I'm going to ask you to change your life on my behalf, you're at least going to get a living wage, and closer to what we call a "thriving wage"--even for entry-level work. If you're on the team, we've got your back. We don't want you to be tired. We want you to be healthy. We want you to develop financial security. And we want you to work hard in service of the company's mission, its customers, and its people.

I haven't been writing for quite some time and have really felt the need to start again. Writing helps me clarify my thinking, and I haven't been doing that, so things sit there, clogging up my neural pathways (don't ya love science?).

So I'm pledging to go back to the daily post. I'm hoping you'll hold me to it, and that all three of you will chime in on the comments. Thanks for reading.

Wednesday, July 16, 2014

The Not Really Sharing Economy

Words have meaning, words matter.

Sharing is one of the great human attributes; you have something and your neighbor can benefit from it, you see the need, you offer to share it. There's no or little cost to you, and no cost to your neighbor.

In the lunchroom: "Would you like to share my table?"
On the playground: "Would you like to share my ball?"
At the picnic: "Please, have some of our chicken!".

That's sharing.

We share without the expectation of something in return. Sharing is not transactional. It's an act of generosity, an act of love, and sometimes an act of necessity.

So when the tech, investment, and startup media and bloggers came up with "The Sharing Economy", they weren't talking about you and I pooling our tools together, creating a tool library, and sharing it with others. They weren't talking about a couple sharing a milkshake.

They were talking about transactions involving excess capacity of stuff--a house, a car, an office.

Folks, when you charge me to stay at your house, that is not sharing. That's a great business model, and I love AirBnb, but that's not sharing. That's rent.

When you offer to drive me from one place to another for $15, that's not sharing. That's charging me for a transportation service.

Sharing is a beautiful thing. The media--and VCs, and etc, etc etc--got it wrong, and are sullying a great word with an otherwise stellar reputation.

Now that I've shared my thoughts with you, I'm going to go charge somebody for a loaf of bread.

Friday, July 11, 2014

Lancaster Food

So we're rolling--we landed on shelves this week with the first four products from The Lancaster Food Company: organic whole wheat, organic soft white, organic sandwich rye, and organic sprouted multigrain.

Lots to catch up on, so I plan to start posting a bit more soon. I've said that before, eh?

Thursday, May 1, 2014

The Lancaster Food Company

It's been quite a while, folks! I've had difficulty blogging over the past nice months, as you might have noticed by the complete absence of posts.

For the past six months I've been working on a new company--The Lancaster Food Company. We make a range of organic food products, including organic breads, spreads, sauces, and salsas. Our parallel missions are to create thriving-wage employment for vulnerable populations, make tasty organic foods, and support the local food ecosystem here in the metropolis of Lancaster.

Starting a food business ain't easy--it sure ain't software. Finding a space, converting the space to a commercial food-grade facility, meeting the organic standard (i. e., fill out lots of forms), finding suppliers, buying equipment. What--you mean I can't just provision services on Amazon Food Services? (Actually that's not a bad idea--we could use a food accelerator here in the hometown).

I've decided to start blogging again. This time it will be very light on tech, light on startups, heavy on food startups, the food ecosystem, building a social impact business, and whatever else develops.

In the meantime, sign up to learn more about The Lancaster Food Company. We'll let you know of our launch--give us about five weeks to get our first batch out the door. Thanks for coming back!

Thursday, December 12, 2013

Capitalism & Community

Fred posted about capitalism today, noting the amazing wave of automation enabled by relatively recent advances in a broad range of technologies, and how that will displace millions of workers.

That is, of course, if we choose automation over people and communities. In some cases, the automation is welcome, innovative, and new in that it creates new business instead of disrupting existing ones (or simply solves a problem without creating a new business...not everything needs a dollar sign affixed to it).

But in most cases, the automation will be at the expense of people who held the same or similar jobs, to the benefit of people on the other end who want their widgets in 3 hours instead of 24. 

It's a choice. 

It's worth reading the blog, but even more worth reading the comments. The libertarians are of course always right and denouncing Fred's liberal tendency for actually caring about people, and the plutocrats, well, they'll let us eat what GMO-baed high-fructose corn syrup carbonated battery acid, unless we complain and then they'll shut down the Twinkie plants (yes, they shut down a profitable business at the expense of the workers but to the benefit or your coronary arteries). 
My comment is here, imperfect and off the cuff but it gets to the heart of the matter, obviously informed by people like Judy Wicks and

"Capitalism used to be the economic system in service of our democratic republic. The opposite is now true; we're a plutocracy.
But to the point: business owners will have to make the conscious choice to hire people instead of automating to squeeze every last bit of profit.
Communities are a mix of people (some employed, some not), businesses, professionals, etc. When businesses choose not to employ simply to make more profit instead of asking "how much is enough", we will see the end of our communities.
We already see this in communities around the country, whose jobs went overseas chasing profits through cheaper labor and now amazing but destructive automation.
I'm (we're) choosing not to automate (edit: as much as possible). I'm much more interested in people than profit. I love me some profit, but I'd rather live in a vibrant, strong community. To bolster that, our supply chain will be as local as possible, and together we'll build the antidote to unfettered capitalism: (maybe call it) responsible capitalism."

Tuesday, November 26, 2013

A Calling

It's been months since my last post. Forgive me, but I've been, well, thinking.

I met Judy Wicks in 2003 in Philadelphia at a meeting of the Philadelphia Sustainable Business Network. She encouraged me to go to an SVN conference in the Fall, and seeking like-minded entrepreneurs, I did (and seeking campaign contributions, sadly).

It was there that I learned about Greyston Bakery and dozens of other businesses designed to have social impact through the daily act of building and growing business. Greyston has an open hiring policy,  meaning that if there's an opening, they'll take the next person in line for the job regardless of their personal history, credit rating, homelessness, criminal background, etc.

Their motto is "we don't hire people to bake brownies, we bake brownies to hire people". Last year they did about $10 million in business; if you've had Ben & Jerry's ice cream with brownies in it, you've helped to hire people.

That commitment, that act of love, that recognition of basic human dignity, all delivered daily--that moved me and troubled me at the same time. I was on the way back up from losing a fortune from ChiliSoft by refusing to sell SUNW all the way down, and felt I needed to hit another home run. That feeling led to a great company, but also led to some bad mistakes, including, I think, delaying the transformation of my admiration of the Greyston commitment to my own commitment to something that reflected a similar basic love.

That bugged me for some time. Ten years. Last year I posted about the gnawing that I've felt about living a meaningful life, and what my life's work is or should be.

That was 18 months ago; I continued to delay, wanting one last swing. So when Vic asked me to lead BigLeap, well, it served the purpose of take another swing while doing something that could have positive impact.

When something gnaws at you for so long, you need to address it. Clearly I believed that this was important work. Why wasn't I diving in?

Part of it was money. I had none up until the sale of my last company this summer. Part of it was fear. Building a business is hard enough, and adding a requirement like open hiring at wages that reflect human dignity is that much harder.

This Fall I recognized that I wasn't pulling as hard as BigLeap needed me to. I wasn't nailing it. Yet I was looking for a place to live in the Bay Area or New York, and was about ready to get a realtor and make a move.

I rationalized it, thinking that I needed a break from Lancaster, that the space would do me good, that I should swing for the fences again. New York easily won out over the Bay area.

Then one weekend I took a hike with a new friend, someone I had only met once before. The conversation was all over the place, but it was one of the most important I've had in a long time. At one point she said something about how it was important for her to "claim her priorities".

That resonated with me. I hadn't set any priorities. I talked about my values, about how Lancaster seems to refuse to talk about poverty or deal with it on a human level. I complained (the optimism of dissent). But I hadn't claimed my priorities. Defined them, set them, committed to them.

I lived in New York City during 9/11; lost a dozen neighbors and one friend, and had trouble dealing with the regular reminders for months, especially when the wind would shift and blow the smoke north; I lived on Great Jones, which was close enough for the building to shake when the towers fell, and close enough to be smokey depending on the wind.

New York offered a lot, but I never felt a sense of community. As usual, I was doing it wrong, choosing to live in Manhattan while my friends were in Brooklyn, running in circles that cared little about me personally.

I felt alone after 9/11, except occasionally when I was with a friend from high school. So I retreated to the beach, where for two years I felt alone and no sense of community.

In 2004 I moved back to Lancaster to build the company. It took a while, but finally I found a lot of friends and now feel a very strong sense of community. I can't say I never feel alone anymore, but I do feel at home and there's comfort in knowing that good friends are just a few blocks away.

In looking to move to New York I wasn't honoring the importance of that sense of community. I knew it and felt it. I knew that by moving I'd be starting over to some degree, though I do have friends there, but it would never be my home, and I'd never be a New Yorker. And I know where home is--it's here in Lancaster.

That hike somehow triggered a real sense of purpose and focus. I've felt a calling for a long time, but haven't honored it, and that's what the gnawing was about all this time.

Not long after that I cancelled plans to live in New York. I talked with Vic about stepping down from BigLeap, which I did and now serve as an advisor. I decided to work full time in Lancaster on building the economy south of King Street, and ending poverty here as a moral imperative, or at least reducing it. (And yes it sounds grandiose to me too. It's a good sign of a an entrepreneur or a sociopath, take your pick).

Doing that isn't particularly complicated; people need jobs that at least pay living wages, and those jobs have to be within the reach of their skills. Recently I've been thinking in terms of thriving wages, and employee wealth through equity. How can we make that happen?

And what wage reflects human dignity? $7.25/hour?

Walmart pays poverty wages to many of its employees. To me that's simply morally wrong and we should not as a society accept that. Lancaster County businesses and consumers should also reject poverty wages by cutting off the companies that continue to do that.

actual sign at a Walmart in Cleveland this month
We end up subsidizing those companies through poverty support programs like food stamps, WIC, EITC, and a host of other programs. It's offensive that our taxes go to subsidize Walmart's lack of humanity, to support its poverty culture, not to mention its negative impact on US manufacturers. </end of rant>

So about a month ago I started working on this full time. And to leave tech.

Initially my job would be to organize social impact entrepreneurs, evangelize about values-driven businesses, raise investment capital for businesses committed to ending poverty through daily business practices, and a long list of other things we need to develop a healthy social-impact ecosystem which leaves no room for poverty or poverty wages.

That lasted a week :)

By the end of the week I realized we really don't have many businesses like this, or social impact entrepreneurs starting new ones. I felt like I'd be pushing around the edges, but not actually doing. And if anything I'm a starter, an entrepreneur.

So I decided to start a new company that will, metaphorically anyway, bake brownies to hire people. I'll still evangelize, still organize and convene (Judy's kindly agreed to speak at the Ware Center on December 6th as part of a monthly speaker series, and we started a social impact meetup), but my day gig will be the new company. I'm starting it with a close friend; we'll give more details when we're further along.

So that one conversation on a long hike down at Tucquan Glen had pretty powerful effects.

Instead of leaving again, I decided to go all in here in Lancaster--to stay here, buy a building here, invest here, build a new business here (south of King Street), organize like-minded people here, and make an honest attempt to serve the calling. To commit.

It's going to be hard (I've failed before and easily can again), but this is a great city and our people have open hearts and generous spirits. I'm happy this is my home, and I'm thankful for the opportunity to try to make an impact on what to me is our biggest problem.

We can call it social justice or economic justice, but what it comes down to is this: business can serve as the vehicle for our highest aspirations, and sometimes it's as simple as giving someone a chance to work for a living, at a dignified wage, a chance that others (so far) won't give.

Or if you're an existing company or consumer, it's as simple as buying something from a social enterprise instead of from Walmart, or a supplier who doesn't reflect your values.

Vote with your dollars. It matters. 

Ending poverty seems lofty. Maybe crazy. Simplistic. But if we embrace it as a moral imperative, and convince ourselves and other business owners to make our businesses reflect our personal values, to value people regardless of their backgrounds or skills, I'm convinced we can create a self-sustaining, overflowing wealth of opportunity that rewards all of us, in ways far beyond profit.

To me this is meaningful work, and if there is such a thing as a calling, for me this is it. I'm all in. That was one hell of a hike.