Job Quality as a Part of CDFI’s Mission

Job Quality as a Part of CDFI’s Mission

In addition to their mission of providing financial services and products to people and businesses in low-income communities, many Community Development Financial Institutions (CDFIs) consider themselves more broadly as vehicles for economic development in their communities. Beyond supporting business creation and growth, they support the creation of quality jobs for community members. 

Maureen Conway, Executive Director of the Aspen Institute Economic Opportunities Program, recently sat down with executives from two leading CDFIs and Shared Success grantees: Amanda Blondeau, the Chief Strategy Officer of Northern Initiatives (founded in the face of declining resource extraction in Michigan’s Upper Peninsula), and Robert Boyle, CEO of Justine PETERSEN (founded to serve the greater St. Louis region). 

This interview has been edited for length and clarity. Listen to the full podcast interview here. 

Maureen Conway: Amanda and Robert, I’m thrilled that you’re here for our series on job quality in small businesses and, in particular, to talk about how the issue of job quality relates to the mission of Community Development Finance Institutions (CDFIs). Historically, CDFIs have focused on job creation and job retention as drivers of economic development in their communities. What inspired a shift to include job quality as part of the mission work of a CDFI? 

Amanda Blondeau: At Northern Initiatives, we are celebrating 30 years of helping businesses to start and grow. As a CDFI based in Michigan, we were founded in the face of declining resource extraction in Michigan’s Upper Peninsula to help people create opportunities for themselves as jobs left our region. But it’s not just about having the job. We’ve thought about job quality for a long time, but the changes that COVID brought to our economies brought it to the forefront. Attracting and retaining employees is one of the biggest challenges we hear from small business owners. A lot of that comes down to the quality of your job.

Robert Boyle: Similarly, for us at Justine PETERSEN, our mission is to support individuals in building their assets and creating enduring change. We have partnered with business owners to offer credit-building services to workers, going deeper into the organization so the business owner can provide quality jobs.

How do you define “job quality”? How do you work with your team to integrate job quality as a focus in your work as a CDFI?

RB: Job quality is not simply about money; it’s about holistic opportunities for the employees and their families. Employee recognition is a big part of the work that we’re beginning to do. We are asking potential borrowers, “Are you thinking about what your employees are feeling and understanding?” We are trying to lead by example within our own organization, implementing an employee recognition program, which has really energized our group. 

AB: Reflecting on employee experience, I’ve been at Northern Initiatives for over 21 years now. I think a big part of it starts with the environment that we’re in. I’ve been able to move up and have a voice in what we’re doing. I feel very supported. 

Participating in the Aspen Institute’s Job Quality Fellowship started our journey of evolving our offerings to include job quality “know-how” to small, growing businesses. We are now asking, “What do you want to make out of this? How do you create wealth and offer economic mobility? Can you offer flexible scheduling?” while also meeting the entrepreneur where they are at and where they want to go. 

Both of you are also concerned about how to build a more inclusive approach to economic development within the places where you operate. How does job quality connect to that part of your mission?

AB: A CDFI’s mission is to focus on underserved, underinvested communities. Who gets left out in our financial and economic system? When Northern Initiatives was created to serve the Upper Peninsula of Michigan, we were focused on serving rural communities. As we’ve expanded to serve all of Michigan, we look at who gets left out in urban communities; often that is people of color. We will lend to anyone who meets our lending criteria, but we want to make sure to address the barriers that have kept folks from accessing capital and other resources. We provide loans so that they can create that job and grow that business. We believe that is the path to wealth: building assets. The CDFI supports where others cannot or are not set up to in order to create economic mobility and stability in those communities.

RB: In some ways, it’s natural for Justine PETERSEN because of the demographics of our region. We have a strong focus in St. Louis, where we were founded. We also lend throughout Missouri and in southern Illinois and in Kansas as well, so of course, the demographics of who we serve in those areas is different. However, among the biggest challenges is creating an understanding that the job quality activity is an investment into the business, just as financial capital is an investment or building improvement is an investment.

So often, we hear job quality framed as a trade-off, like if you invest in workers, that’s bad for the business’s bottom line. How do you address that?

RB: It’s difficult to measure. We’re just beginning to think about how to confirm for our business owner, with data, that this is really going to pay off. I can’t be definitive at this point about whether or not we’re getting through to our business owner. It’s similar in some ways to the small business owner who’s been successful but may not have an accountant. You think that this is an expense, but it’s actually an investment in our employees and our business.

AB: When I was a coach, one of the things that would really resonate with some small businesses is telling a story of how staff treatment can indirectly impact the reviews your business receives. If you’re seeing reviews of “the staff were nice” or “the staff were cranky,” that’s usually based on that job. How many times have you been to a restaurant and you could tell that people just weren’t happy? You’re not going to go back. It doesn’t matter if they have the best food around. It’s not just about the quality of food. It’s the quality of the experience. And that really comes down to how people are treated, and how good of a job this is, and does it meet their needs. Employees really are our most precious asset. 

Is there anything you would say to your fellow CDFIs seeking to connect job quality with economic development in their communities? 

AB: I would say it’s a continuum, and you don’t need to understand it all, but we need to start having the conversations. There are a lot of resources out there, which is great, but it can be overwhelming. Just start the conversation, for example, about attracting and retaining employees, because that is a common challenge for businesses everywhere. 

RB: The idea of giving a voice to your employees is a really new notion to those business owners. I think often business owners feel that because it’s their business, they should have all the answers. Small business owners tend to take on everything themselves and don’t really think about the really good advice they can get from asking their employees, so encouraging that can be a good entry point. 

To close, I would be curious to hear if there’s one example of a small business in your community that inspires you as you do this work.

AB: There are so many, but one that I’m thinking of is a jeweler that creates their own jewelry*. They had priced their product and marketed it in a way that they now are able to take vacation. They can employ other artists, train them, and offer benefits. Some of their employees also started their own businesses, which is also a success and has led to this growth in the community of artisans.  

RB: There is an extraordinary person named Rochelle who first came to Justine PETERSEN in the early 2000s to purchase a home. Subsequently, she began to build her child care center from a very small operation to one of the larger operations in the St. Louis region. And the neat thing about Rochelle is that she’s brought into the organization an opportunity for her staff not only to have a living wage but quality jobs. 

Wonderful. Thank you both so much for talking with me. I am really grateful for the work that you both do in the communities you serve.

About Shared Success

Shared Success is a project of the Economic Opportunities Program, works with community lenders to integrate job quality programming into their small business support services, demonstrating that improved job quality can support the needs of employees while helping small businesses succeed.

About the Economic Opportunities Program
The Aspen Institute Economic Opportunities Program hosts a variety of discussions to advance strategies, policies, and ideas to help low- and moderate-income people thrive in a changing economy. To learn about upcoming events and webinars, join our mailing list and follow us on social media.