COVID-19 Project Overview
In the wake of COVID-19, U.S. unemployment levels reached almost 30 million — with more than half of unemployed people permanently displaced from their jobs. And while there are millions of unfilled positions, about two-thirds require postsecondary education. For many young adults, rising education and career training costs are a barrier to employment, especially in recession resistant industries like healthcare and IT.
UP Fund is working to help students from low-income backgrounds overcome the education roadblock by making skill-building and career-based training more accessible.
Unlike other financing models for comprehensive workforce providers, which rely on philanthropy and government funding, UP Fund leverages Career Impact Bonds financed by impact investors. These bonds support thousands of students by covering the upfront cost of intensive career training and job placement in high-demand fields.
This whole thing kind of changed my life — I effectively doubled my income with 4-5 months of work.Branden LaCour, General Assembly Career Impact Bond Graduate
How it Helps
For students from low-income backgrounds, pursuing postsecondary education can be a big risk — especially amid the pandemic. In addition to racking up significant debt, there’s no guarantee they will be able to secure gainful employment after graduation. And while many accelerated training models exist, they usually come with a hefty price tag, too.
But UP Fund’s alternative financing model helps lower these barriers and alleviate risk factors for students.
Developed by the nonprofit Social Finance, Career Impact Bonds make up a catalytic capital investing pool that is used to fund at least 50% of course costs. The remaining balance is deferred until after students complete their training, earn a job, and reach a certain income threshold. To help ensure their future success, students also have access to support services like financial coaching, mental and behavioral health care, and job placement. Additionally, the bonds offer consumer-friendly repayment features including grace periods and payment caps.
By helping to train and reskill thousands of young adults, UP Fund is improving their career prospects for in-demand fields like software engineering, user experience, IT, healthcare, and more.
Photo at top courtesy of General Assembly.