Opportunity Costs and Social Capital
Updated: Dec 3, 2020
After thirty years in the field of workforce development, I am surprised that there is little recognition for the importance of social capital building. Especially since it is the number one way people find jobs in the U.S.
When enrolled in a workforce development program, most youth are given instruction on basic strategies such as handshake techniques and the best ways to answer the ten commonly asked interview questions. Most workforce agencies don't provide students with social capital building support, often never helping students identity their existing social capital assets. At the same time, Ivy League colleges are proactively helping students cash-in on social capital like a winning scratch off ticket. Why is workforce development lagging so far behind?
It’s time every young adult has the truth about the job hunt and career success, no matter what their economic status. I’ve hear countless stories of young people who spend valuable time and money on workforce training only to find out that there is no one on the other side of the labor market ready to assist them in putting their hard earned credential or skill to work. Many feel betrayed and have documented their experiences to their peers who consequently refuse to engage the programs that failed their peers in the first place. And the recruitment problem continues.
Every youth has the innate desire for significance and self-sufficiency and most do not sit idly by while their friends enroll in workforce service programs. For those that don’t enroll, they find other ways to engage in job seeking and opportunity building, of which social capital building is paramount.
Herein lies the dilemma - it’s called opportunity costs—the cost of doing something better. Let’s me use Rayshawn again as an example (his real name is Kevin but he hates his government name). Rayshawn is about to graduate from Anywhere Workforce Development. He needs a job to start paying child support. He starts the process by writing a résumé, filling out one hundred online job applications, and going on ten interviews - all set up by the Anywhere program staff. At the same time his buddy, Logan is out there making connections and building social capital. For each hour Rayshawn spends in a classroom, Logan is in the community connecting.
If Rayshawn decides to continue his traditional job-hunt strategy instead of building social capital, the opportunity cost of the traditional job hunt is the potential benefit of building more social capital. So which one will have a greater payoff?
For most workforce development professionals, traditional job search techniques seem like the best way to help Rayshawn get employed. At least they are easily quantifiable. In the data driven human service world, all the quantification you can get is key, right? But assisting Rayshawn in building social capital with gainfully employed adults, something that is not so easily measurable and rarely effectively studied, is also critical.
What Rayshawn is “losing” by traditional job hunting is an opportunity cost—a huge one. Not only will social capital help him find a job, it will also set in motion a process to make sure he is never without a job again. The lost opportunity is the price for following traditional ways. In this case, he is paying the potential of building social capital - it can be a costly non-choice.
Edward DeJesus is the President of Social Capital Builders.