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Terri Lee Freeman

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Investing in Education, Workforce Development and the Safety Net Will Close the Income Gap

Posted: 03/19/2012 4:46 pm

Ours is a region of breathtaking wealth and heartbreaking poverty. A new report released earlier this month by the DC Fiscal Policy Institute confirms just how large that income inequity gap really is. The analysis, which focuses on the District in particular, reveals that the richest five percent of households have an average income of $473,000, the highest among the 50 largest cities in the United States. Meanwhile, the poorest 20 percent of District households have incomes averaging under $10,000. Income disparity in the Maryland and Virginia suburbs is increasing as well.

In other words, while our region's economy has led to economic growth and prosperity for many on the middle and higher rungs of the ladder, residents on the bottom of the income scale largely are being left behind.

This is hardly a surprise to those of us who are involved with philanthropy. As one of the leading funders of nonprofits in the Washington region, The Community Foundation for the National Capital Region is committed to promoting equity, access and opportunity for all residents of our community by investing in effective nonprofits. If anything, the new report only reinforces what we see every day through the hundreds of organizations funded by our community of givers.

Our philanthropic efforts take on a new urgency as local and state governments are grappling with budget cuts that would have a devastating effect on low-income residents already hit hard by the recession. As jurisdictions in the District, Maryland and Virginia weigh tight budget proposals and consistently return to human services and housing for cuts, we recognize that it will take both increases in public revenues and increased investments from philanthropy to assure that all residents have access to our region's prosperity.

While philanthropy alone cannot address income inequality, it can make a difference. We believe economic security can be achieved by investing in three key areas: education, workforce development and the safety net.

1. Education. How can we expect young people to be successful and eventually achieve economic security if their educational foundation is unreliable? We must invest in education to increase the percentage of youth who graduate from high school ready for post-secondary activities. Philanthropy can catalyze change by investing in strategies that prevent youth from falling off track, intervene with at-risk students, reengage students and accelerate completion of graduation requirements, and target drop-out populations for re-enrollment toward an educational and career trajectory.

2. Workforce development. Employers in our region have thousands of positions that go unfilled but for a skilled workforce. We must increase the number of employable adults by investing in effective workforce development that provides workers both increased skills and marketable credentials, post high school. We have too many positions in the region that go unfilled but for a skilled workforce.

3. Safety net. The Washington region has one of the strongest economies in the country, yet poverty continues to grow and the demand for basic safety net services such as food and shelter continues to increase as public resources decrease. Job loss or reduction in hours and the collapse of the housing market make it difficult for families to keep their homes and has led to an increase in requests for emergency services. The impact of the economic crisis is far from over. The Community Foundation's focus is on helping the region's safety net operate more effectively, increasing and preserving safety-net funding and improving policies to reduce poverty over the long-term.

In the end, it will take public, private, and nonprofit partners working together to catalyze positive community change and ensure we are no longer a region of haves and have nots.