Oakland: Reimagining Small Business Lending to Improve Jobs

“As a CDFI [Community Development Financial Institution], we often don’t have the bandwidth and resources to take new ideas and translate them into action. Reimagine Retail has provided critical and timely support to help us create and pilot a quality jobs toolkit that offers practical tips, guidance, and approaches for small businesses to address business challenges and opportunities through an employment practices lens. This has shifted our work at PCV and strengthened our lending to small businesses and consulting to impact investors. Our hope is that, over time, the toolkit can help CDFIs, impact funds, workforce development organizations, and others better engage with small businesses and undertake strategies to improve job quality. Reimagine Retail has been really helpful in shaping our thinking for how best to work with small businesses and improve job quality in ways that work for businesses, employees, and communities.”

— Tom Woelfel, Pacific Community Ventures

Jen Musty, owner of the small business Batter Bakery. Musty piloted the Good Jobs, Good Business Toolkit and saw benefits for her staff and her business.

Jen Musty, owner of the small business Batter Bakery. Musty piloted the Good Jobs, Good Business Toolkit and saw benefits for her staff and her business.

Through Reimagine Retail, Pacific Community Ventures (PCV) adapted its small business lending and advising practices to improve worker mobility and job quality. With technical assistance from Aspen EOP and the MIT Good Jobs Institute, PCV (a CDFI located in Oakland, California) developed the Good Jobs, Good Business Toolkit, a first-of-its-kind how-to guide for small business owners that makes a business case for investing in workers and offers actionable guidance and resources on hiring, training, employee engagement, wages, benefits, and scheduling. PCV conducted a six-month pilot to test the toolkit with small retail and service-sector businesses, pairing each one with a business adviser. Five businesses completed pilots; all engaged in meaningful workforce practice changes that have demonstrably improved business performance and worker experience.

The pilots indicated that many small businesses are eager for coaching and nimble enough to make changes quickly. For example, DAD Services, a minority-run, family-owned cleaning company with 25 employees, identified the need to expand middle-management positions. During the pilot, the company made four internal promotions, developed management training, and launched an online training video library. Owner Donald Jacko Sr. says these changes reduced attrition and absenteeism and are helping lower administrative costs. Since the pilot, “things run more like a well-oiled machine,” Jacko says. At retailer Batter Bakery, owner Jen Musty piloted new training and employee engagement approaches that she credits with improving customer service, resulting in a $22,000 increase in sales over a three-month period and helping her retain workers in a high-turnover business. She has since strengthened benefits and increased wages. “Staff are on the front lines with customers and communicate what’s special about our products,” Musty says. “It’s important they feel they are learning and can grow within the company.” To make its toolkit more accessible and based on pilot feedback, PCV created the Good Jobs, Good Business website, which launched in September 2019.

Through the Reimagine Retail network, PCV has shared the toolkit with a variety of workforce development organizations, including Reimagine Retail Chicagoland members. Workforce organizations were not PCV’s original target group, but many have been eager to use the toolkit with their small business partners. Workforce organizations and lenders have shared interest in approaches and tools that support their work focused on improving job quality, which can contribute to better outcomes for workers, enhanced business results for small businesses, and stronger lending outcomes.

 

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Reimagine Retail explores ways to enhance job quality and improve mobility for the retail workforce. Reimagine Retail is a project of the Aspen Institute Economic Opportunities Program. Learn how EOP is helping low- and moderate-income Americans and thrive in a changing economy. Join our mailing list and follow us on social media to learn about events, publications, blog posts, and more.