Pay for Success in Action: Massachusetts Pathways to Economic Advancement
The Massachusetts Pathways to Economic Advancement Project is a Pay for Success (PFS) initiative that is designed to increase employment opportunities for limited-English speakers by providing workforce development services. Developed by the Commonwealth of Massachusetts, Jewish Vocational Service (JVS Boston), and Social Finance, the project aims to deliver services to about 2,000 immigrants and refugees in Greater Boston over three years. The project's English for Advancement (EfA) program offers vocational English language classes, integrated with job search assistance and coaching, to help limited English speakers make successful transitions to employment, higher wage jobs, and higher education.
About the Investee
JVS is one of Greater Boston’s largest community-based workforce and adult education providers. Through the PFS investment, JVS will offer four programs – Rapid Employment, English for Advancement, Skills Training, and Bridges to College. The Commonwealth of Massachusetts will repay investors only if JVS successfully achieves positive outcomes defined at the outset of the project.
About the Impact Investors
The project’s 40 impact investors include several MIE members. Bank of America Merrill Lynch acted as the placement agent for certain qualified high net worth and institutional investors.
- Prudential Financial, Inc.
- Maycomb Capital, Community Outcomes Fund
- Combined Jewish Philanthropies’ Donor Advised Funds
- Barbara Bush Foundation for Family Literacy
- Blue Haven Initiative
- The Boston Foundation
- Boston Impact Initiative
- ImpactAssets
- The Inherent Foundation
- The Kresge Foundation
- The Shapiro Foundation
- Sorenson Impact Foundation
Results To Date (Updated 11/23/2020)
An evaluation of the English for Advancement (EfA) program, which includes an ongoing randomized control trial, showed that EfA demonstrates a substantial impact on earnings in the second year after project enrollment, averaging $3,505 over the first two years. Participants with previous US work experience who came to EfA unemployed realized earning gains of more than $7,100, compared to members of the control group during the second year after enrollment. Massachusetts Pathways to Economic Advancement is the first Pay for Success project in the nation to focus on workforce development.
Maycomb Capital's Community Outcomes Fund: The First PFS Investment Fund in the U.S.
The Kresge Foundation and Prudential Financial Inc. supported this PFS transaction via Maycomb Capital's Community Outcomes Fund, a new equity fund that will invest in outcomes-based financing transactions in the U.S.
Projects supported by the Community Outcomes Fund will help government scale social and health services that produce measurable outcomes in social and economic mobility. Through the Maycomb Fund, Prudential Financial, Inc. provided nearly 50% of total investment to the Massachusetts project. The Kresge Foundation provided a guarantee (in the form of a PRI) of up to $10 million to the Community Outcomes Fund, which offers limited credit protection to Limited Partners in the fund.
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