In Crisis, L.A.'s New Civic Tech Program Pivots from Providing Internships to Basic Needs
Apr 22 2020
The vision of LA-Tech.org as it prepared to launch this month was of a thriving tech ecosystem coordinating its resources to give back to the L.A. community.
Built by a group of L.A. CEOs and founders from the likes of Cornerstone, Blackline and Factual, the coalition originally sought to bridge the growing divide between wealth and want in Los Angeles through programming to provide low-income youth with internship opportunities at tech companies like Snap and ZipRecruiter. The idea was both to give back and to support the L.A. tech world by strengthening its local labor pool and helping employees feel connected to their community.
<p>But as the coronavirus plagued one corner of the world after another, holding live events became impossible and the suffering of low-income Angelenos took on new urgency. Taking a page out of the startup playbook, LA-Tech.org has pivoted. It is now launching with a <a href="https://la-tech.org/covid-19-response" target="_blank">fundraising program</a> to raise $415,000 for two local nonprofits, <a href="https://homeboyindustries.org" target="_blank">Homeboy Industries</a> and <a href="https://www.ifoster.org" target="_blank">iFoster</a>. In doing so, LA-Tech.org is addressing two areas of severe collateral damage caused by the pandemic: food security and the digital divide.</p><h2>An Ugly Crisis, Acute Needs</h2><p>"The economic contraction that's happening in L.A. right now is worse than it was in the last recession," said LA-Tech.org Executive Director Sean Arian, who in 2008 was Director of Economic Development for L.A. Mayor Antonio Villaraigosa. "It is faster than it was in the last recession, and it is hitting the lowest-income people first."</p><p>The crisis, Arian told dot.LA, is thus exacerbating the economic inequality that spurred the formation of LA-Tech.org in the first place. Since 1990, low-wage service jobs have grown in L.A. by 17%, while high-wage, mostly high-knowledge jobs have grown by 7%. But middle-wage jobs have plummeted. </p><p>Whereas the 2008 recession first struck the well-off – mostly via finance and real estate – the coronavirus fallout is most acute among the economically vulnerable. Worse, the nonprofit community that seeks to serve such people has seen its funding shrivel. </p><p>"The need for services for low-income people has gone way up at the same time that revenues – basically donations – to nonprofits have started to dry up," Arian said.</p><p>After several conversations across government, nonprofits, and the private sector, LA-Tech.org had its plan of action.</p><h2>Combating Food Security with the Homies</h2><p class="shortcode-media shortcode-media-rebelmouse-proxy-image">
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</p><p>Homeboy Industries helps formerly incarcerated gang members heal from conflict and trauma and re-enter society. Included in its suite of therapeutic programs is a chain of social enterprises – the Homeboy café, bakery and catering service – where a subset of members work, usually before moving on to jobs elsewhere. About 90% of participants have never held a job for more than a month, Homeboy chief executive Tom Vozzo told dot.LA.<br/></p><p>With the coronavirus shuttering its programming and slashing business traffic, Homeboy can't serve or employ as many people. In response, it, too, has pivoted, to making fresh, prepackaged meals. And it will now be getting a hand from LA-Tech.org.</p><p>"If we can get to 1,000 meals a day then in our café we can get to employing the same amount of people we had before we closed our doors," Vozzo said. Currently they're making less than 500 meals per day. </p><p>Donations will not just help Homeboy keep its program running, but will also send prepackaged meals to the needy, including people experiencing homelessness, foster youth, and low-income seniors. </p><p>"There are a lot of tech companies that have these huge catering budgets they aren't using anymore," Arian noted. He hopes these funds can be redeployed via LA-Tech.org to Homeboy. </p><p>Having adjusted its operations to accommodate social distancing, Homeboy is ready to move quickly. "Once the L.A. tech community donates money to us, in 48 hours we're turning that around into meals." </p><h2>Filling the Digital Divide with iFoster</h2><p class="shortcode-media shortcode-media-rebelmouse-image">
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</p><p>"What happens when someone who's a low-income student has to do all their learning online and doesn't have a laptop?" noted Arian.<br/></p><p>"Mass panic," said Serita Cox, co-founder and chief executive of iFoster, an L.A.-based, national nonprofit that aims to provide resources to foster youth. </p><p>Normally, Cox told dot.LA, items like laptops and smartphones are a key priority for iFoster, because technology isn't included in typical child welfare benefits. A joint study with USC, Cox noted, found that only 21% of late-high school and early-college age foster youth in L.A. county had access to the internet and a computing device at home; that compares to 79% of non-foster, low-income students aged 13-17, according to a Pew Research report. </p><p>"In child welfare, technology took a backseat to basic needs," Cox said. "But now, technology has come front and center as a basic need."</p><p>The list of resources that foster youth depend on but can no longer access face-to-face include school, family visits, social workers, attorneys and therapists. Requests for gear have ballooned, from a typical 50 per week to over 500. </p><h2>Stepping Up for L.A.</h2><p>LA-Tech.org has a fundraising goal to deliver 1,000 laptops through iFoster.<br/></p><p>"Only 8% of foster youth ever get a college degree," Cox said. "We can't make it worse."</p><p>Arian wants tech companies throughout the community to get involved with the <a href="https://la-tech.org/covid-19-response" target="_blank">Step Up For LA</a> program and "make it their own."</p><p>It's the beginning of what the LA-Tech.org founders hope will be an ongoing collaboration among the tech community in its efforts to give back. </p><p>"We felt," said Adam Miller, Chief Executive of Cornerstone OnDemand and co-chair of the LA-Tech.org Board (also a dot.LA investor), "like we could accomplish this collectively much better than we could individually."</p><p>---</p><p><em>Sam Blake is a reporter at dot.LA, where he primarily focuses on media & entertainment. Find him on Twitter @hisamblake and email him at samblake@dot.LA</em><br/></p>
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As regions nationwide steel themselves for the oncoming peaks of COVID-19 cases, the U.S. economy continues to stumble. But some emerging patterns suggest certain changes once it stabilizes.
For now, JPMorgan economists forecasted this week a 40% annualized decline in U.S. GDP for the second quarter, and a 20% surge in April's unemployment rate, with 25 million jobs lost. The number of people seeking unemployment benefits in the past three weeks totals 16.8 million.
<p>What could be in store once the economy rebounds?</p><p>As a tech-savvy online jobs marketplace, ZipRecruiter has a unique vantage point to monitor and forecast the labor market. Labor economist Julia Pollak spoke with dot.LA about what the latest batch of data signals for the other side of the crisis.</p><h2>Show Me the Data<br></h2><p>"This recession is like no other we've experienced," said Pollak. "People are calling this the Great Cessation." </p><p>Some people "will find that during the recovery the economy will have changed beneath their feet." </p><p>There is no sugarcoating the gloom. According to figures ZipRecruiter provided to dot.LA, average daily job postings across the internet have been declining for six straight weeks; worse, the rate of decline has been accelerating. In all but four of the 27 industries that ZipRecruiter tracks, job postings have plunged between the weeks ending March 8th through April 5th. </p><p>Travel (-51%) and tourism (-31%) have been hit hardest. So have states dependent on these industries, like Hawaii (-25%) and Nevada (-24%). These states and sectors are highly sensitive to nationwide trends, noted Pollak, meaning once things start to rebound, they should see relatively quick recoveries. </p><p>Conversely, some job postings are growing fast. These include jobs* in:</p><ul class="ee-ul"><li>Transportation: Commercial Flatbed Truck Driver postings are +2,614% over the past four weeks; Truck Driver Trainer +634%</li><li>Storage: Warehouse Laborer +83%, Warehouse Sorter +62%</li><li>Finance and Insurance: Claims Adjuster +212%, Financial Sales +93%</li><li>E-commerce: Distribution Associate +232%, Grocery Shopper +17%</li><li>Healthcare and Social Assistance: Intensive Care Nurse +188%, Nursing Assistant +184%</li></ul><div>*<em>Each with more than 1,000 daily active jobs on average each week.</em></div><p class="shortcode-media shortcode-media-rebelmouse-image">
<a href="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjkwMjY2NS9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTYxNTUzMjEzOH0.iIjMKKfW9xQC6GoiUmgPaDHhFB_jAcMPEJnjZOJmY1o/img.png?width=980" target="_blank"><img type="lazy-image" data-runner-src="https://assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8yMjkwMjY2NS9vcmlnaW4ucG5nIiwiZXhwaXJlc19hdCI6MTYxNTUzMjEzOH0.iIjMKKfW9xQC6GoiUmgPaDHhFB_jAcMPEJnjZOJmY1o/img.png?width=980" id="dc4b6" class="rm-shortcode" data-rm-shortcode-id="8302a266437556f90fc06497f61365b9" data-rm-shortcode-name="rebelmouse-image"></a>
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</p><h2>The best predictor of future behavior...</h2><p>As for what these foretell regarding the future economic contours, Pollak suggests also looking at past trends.<br></p><p>"All kinds of slow, gradual transformations that we were seeing in the economy before are now going to happen very quickly," she forecasted. </p><p>This includes the decline of certain industries, like manufacturing and retail. "Stores will go into bankruptcy much sooner than they might have," noted Pollak. </p><p>Other industries are likely to continue their ascent. "The healthcare sector has added 278,000 jobs each year on average over the past 10 years," said Pollak. Expect more growth, especially given pent-up demand for elective procedures (assuming age demographic trends mostly hold). </p><p>Meanwhile, workers and consumers are acclimating to formerly peripheral activities now <a href="https://dot.la/online-grocery-apps-are-thriving-during-the-covid-19-crisis-are-they-here-to-stay-2645673118.html?rebelltitem=2#rebelltitem2" target="_blank">becoming mainstream</a>. <br></p><p>"Some of the growth that's occurring now in e-commerce, distance learning and <a href="https://dot.la/can-telemedicine-stem-the-spread-of-coronavirus-2645650007.html" target="_blank">telemedicine</a> will be permanent," Pollak predicted. </p><p>Throughout the economy, "people are learning new technologies (and) interacting with new goods and services that they hadn't used before. And <a href="https://dot.la/coronavirus-prayer-2645604848.html" target="_blank">some are enjoying the experience</a>." </p><h2>Fitter, Happier, More Productive</h2><p>Firms, too, are adapting to new ways of doing business, which could mean increased productivity in the long run. "Companies have been forced to invest in all kinds of technology that may have been available and would have resulted in huge cost savings, and didn't (invest) because of inertia, but now that they've become familiar (with these technologies) they'll use them to great benefit," noted Pollak. </p><p>Reducing headcount, though often painful (and sometimes <a href="https://dot.la/bird-layoffs-meeting-story-2645612465.html" target="_blank">unceremonious</a>), may also ultimately make companies healthier. </p><p>"People get confused when the stock market goes up despite people losing their jobs," tweeted former Presidential candidate Andrew Yang on Thursday. "The truth is that many companies will be more profitable and efficient with fewer employees."</p><p>As working from home becomes commonplace, companies will be able to reduce land costs; and those unit costs will likely be cheaper. Some studies suggest a distributed workforce may increase productivity. </p><p>Workers on the low-end of the earnings distribution may become more productive, too. </p><p>Pollak has found that the federal aid package, combined with unemployment benefits, has left nearly half of all American workers at least as well paid as they were before the pandemic--albeit temporarily. "This offers an opportunity for many low-wage workers to overcome barriers they had to higher-wage employment in better jobs before," she said. There is no guarantee such workers will seize that opportunity, but many now have the time and financial support to train for skills, certificates and licenses that were previously out of reach. </p><p>The big question is the extent to which the damage done to the labor market overmatches the positive trends--and how long it will take to close that gap. The longer the health crisis lasts, the worse the problem will become so long as net jobs continue to decline.</p><p>In the meantime, actions like those taken by the Fed and Congress will buy the economy time, in hopes of hastening what ZipRecruiter Chief Executive Officer Ian Siegel called the "great American comeback story to come." </p>
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ZipRecruiter Slashes Staff by 39% as Job Market Seizes – a Telling Sign as Nation Slides Into Recession
Mar 28 2020
ZipRecruiter, one of the nation's largest websites connecting companies with jobseekers, has slashed nearly 40% of its own staff as the economy buckles in the fallout of the coronavirus crisis that's upended both Wall Street and Main Street.
The Santa Monica-based company cut 492 employees on Friday, with about 49 of them furloughed with only their healthcare benefits and the hope that the company will make good on its intention to bring them back, sources told dot.LA. The biggest hit was at ZipRecruiter's office in Tempe, from its sales team.
<p style="">The move parallels what has become a global economic disaster as stock markets dive and companies freeze spending. Unemployment filings in America surged to a staggering record of 3.3 million last week. And economists predict productivity will be sharply down for the rest of the year, with Goldman Sachs forecasting an annualized 24% shrinkage of the U.S. economy from April through June. </p><p style="">"Our customer base looks like the U.S. economy by size, geography and industry," ZipRecruiter Chief Executive Ian Siegel told dot.LA. "The U.S. economy is hurting and we regretfully have to do what is necessary to make sure we are there for the great American comeback story to come."</p><p>ZipRecruiter -- whose own data is well followed by economists as a harbinger of hiring activity -- faces the same bleak reality that pushed the U.S. government to issue its largest ever financial stimulus package last week, topping $2 trillion. Since the start of this year the S&P 500 has fallen nearly 22%. National unemployment could reach 30% by the second quarter, said St. Louis Federal Reserve Bank President James Bullard. Meanwhile the coronavirus toll climbs, with over 2,000 deaths in the U.S. and more than 124,000 confirmed cases as of Saturday.</p><p style="">In addition to news updates, company executives have kept close watch of internal data to guide their reaction. Most alarming was the rapid decline in new business signups, which have plummeted below half the normal rate. Job postings have fallen, too, by 40% compared to "pre-COVID levels", particularly among non-essential businesses like retail, restaurants and automakers.</p><p>ZipRecruiter determined it needed to prepare for many months of economic lethargy. Sacked workers will receive one month's severance pay, three months of healthcare coverage, and a two-year extension to exercise their equity.</p><p style="">The layoffs are part of ZipRecruiter's broader cost-cutting measures, which also include reducing the marketing budget. Monthly expenses have been cut by $10 million. Siegel has taken a 50% salary reduction, as have his three co-founders, who are active employees and board members. Other executives are also taking pay cuts.</p><p>Company leadership does not think this crisis affects its long-term outlook. It still sees a winning opportunity in using artificial intelligence to connect job seekers and employers, if only once the coronavirus trauma begins to subside.<br/></p><p>They surely hope that'll happen sooner than later. </p><p>The company's statement appears below in full. </p><p><em>The COVID-19 pandemic has dramatically altered almost every aspect of our lives. Among them has been a pronounced reduction in hiring activity over the past couple weeks as "safer at home" edicts have gone into effect across the country.<br/></em></p><p><em>As a result of this decline in economic activity, ZipRecruiter came to the difficult decision to furlough or lay off 492 employees (39% of total headcount) on Friday. These actions are in no way a reflection of the incredible contributions these valued team members made to ZipRecruiter. </em></p><p><em>To help them through this difficult period we provided all impacted individuals with 1 month of severance pay, 3 months of company-paid COBRA healthcare insurance coverage, and a 2 year extension to exercise their equity.</em></p><p><em>In times like these, ZipRecruiter's mission of connecting people to their next great opportunity will be more important than ever. To fuel the coming recovery, the ZipRecruiter team stands ready.</em></p><p><i>----</i></p><p><i>Sam Blake is dot.LA's entertainment and media reporter. Email him at samblake@dot.LA and find him on Twitter @hisamblake. Are you a tech worker in the L.A. who has been affected by job losses due to the coronavirus? Let us know your story at <a href="mailto:editor@dot.la">editor@dot.la</a>.</i><br/></p>
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