Conclusions and Recommendations

Intermediary organizations play an important role in supporting the expansion of equitable, high-quality work-based learning opportunities for youth. Though no two models look the same, WBL intermediaries all need to translate and coordinate across the many partners needed for these programs to succeed and grow. But despite growing recognition of intermediaries’ importance in the expansion of WBL for youth, their finance models—and, importantly, their path to sustainability—are not yet well understood.

Intermediaries’ finance models are complex and, as this report makes clear, they vary. However, all of the intermediaries braid multiple revenue sources to fund their work. Braiding funding sources is often framed as a strategy for sustainability, but for the intermediaries in this analysis, braiding was first and foremost a strategy for survival. Without dedicated, recurring funding sources to support the full cost of their operations and programs, they weave together grants, formula funding, earned revenue, in-kind donations, and other public and private money. These funding models appear to grow more diversified and, by extension, more complex as intermediaries mature and their programs expand. Finance leaders at these organizations also became more adept and comfortable with managing these complexities, allowing the intermediaries—at least those interviewed for our case studies—to achieve a degree of financial stability. Still, however, true sustainability felt elusive. And without dedicated funding to support intermediaries’ role in the expansion of WBL, it might be.

Fortunately, there are steps program leaders, state and federal policy leaders, and philanthropic leaders can take to support the financial health of WBL intermediaries in both the near and long term. Our analysis leads us to make the following recommendations.

• Estimate true costs of implementing and coordinating WBL programming, taking into account not only expenses borne by the intermediary, but also those that may be covered or provided by partners, with or without formal financial agreements.¹ Understanding the true cost of a program—and the true extent of the public and employer investment it leverages—can help intermediaries demonstrate program efficiency and strengthen the case for additional program resources.
• Map funding opportunities in cooperation with partners that have access to different resources that they can use to support a shared mission. Together, determine if and how resources—including both financial and operational resources—might be shared and identify and prioritize funding gaps. Having a shared understanding of options and constraints can clarify priorities and unite partners around common goals, even it does not lead to a dramatic redistribution of resources in the immediate term.
• Establish goals for financial stability while working to develop a vision and plan for sustainability in the long term. Goals should reflect an organization’s overall strategy and might include targets for diversification (e.g., develop earned revenue stream) or resource allocation (e.g., fund staff with reliable, renewable funding source). Setting near- and long-term financial goals can help intermediaries make more strategic decisions as new funding opportunities and challenges emerge.
• Invest in staff capacity to achieve financial goals. For upstart intermediaries, this may mean hiring a full-time staff member to manage complex budgets, track costs and expenses, and apply for and administer grants. The experiences of the intermediaries in our case studies suggests that finance models get more complex as intermediaries expand services and programs. Dedicated finance and development staff can protect an organization as it grows and position it to compete for and manage larger, more complex funding sources.

• Inventory funding sources that can support youth WBL and provide clear, accessible guidance to help WBL partners understand the full range of public resources that can support programs and partnerships. The inventory effort should include funding sources and streams administered by education (including K–12 and postsecondary funding), workforce, economic development, and other relevant agencies. Guidance should clarify if and how funding can support capacity to operate WBL programs, and whether and how that funding can flow to intermediaries outside of the public system. State leaders should also use this process to assess the extent to which existing funding options adequately support public goals or mandates related to WBL.
• Align application and reporting requirements with each other to reduce the administrative burden of WBL intermediaries that braid funding from multiple public sources to support the same program(s). Greater consistency across application requirements (and application systems), reporting templates, and data collection processes would be beneficial and could eliminate barriers that discourage intermediaries—especially those with limited finance and administrative capacity—from pursuing public resources.
• Experiment with flexibility and incentives to encourage innovation and cross-agency partnership. With WIOA and Perkins plans due in 2024, states have an opportunity to reassess and reassert priorities related to college and career success and to realign resources accordingly. For states prioritizing WBL expansion, this presents an opportunity to develop cross-agency strategies for supporting intermediary capacity (within or outside of existing public systems).
  At the federal level, cross-agency cooperation through a new performance partnership model similar to the Performance Partnership Pilots for Disconnected Youth (P3) could support experimentation with innovative finance models for WBL intermediaries, many of which already braid funds from the U.S. Departments of Education, Labor, and Health & Human Services, among others. Designed effectively, the pilot could lead to improved service provision for youth and employers, while yielding valuable insight for federal agencies that administer funding sources that are aligned, but remain problematically siloed.
• Increase investment in intermediary capacity to support WBL. In the near term, state and federal leaders can support intermediaries by creating new grant programs or modifying restrictions on existing grant programs to make it easier for intermediaries to use public resources to coordinate and deliver intensive WBL experiences. To encourage buy-in from employers, grant programs could include local match requirements or technical assistance to develop fee-for-service models. However, in order to truly expand high-quality WBL opportunities for American youth, more reliable, renewable funding streams will need to be created to support the operational capacity necessary to implement them.

• Recognize the need for flexible, patient capital, especially in cases where an intermediary is launching and must build new, cross-sector partnerships to achieve its programmatic goals. High-quality, intensive WBL programs require partners, including high schools and businesses, to change entrenched systems and cultures. Multi-year grants can provide room for WBL intermediaries to build trusting partnerships, while also supporting more robust, multi-year program models.
• Invest in intermediaries’ financial health by supporting dedicated finance personnel, professional development, and technical assistance related to braided finance models. Professional development might target not just the intermediary’s staff, but also finance personnel from across the partnership to facilitate learning, improve communication, and strengthen cooperation. Technical assistance should support intermediaries in understanding the true cost of their programs and assist them in modeling different paths to sustainability as part of business planning efforts. Technical support exploring and applying for large public grants would also be of value.
• Coordinate with other funders to align priorities and investments in WBL to reduce administrative burden and fragmentation in the field. More consistency across grant applications, reporting, and data requirements would benefit individual intermediaries and promote common priorities and metrics for WBL quality. Philanthropy has an important role to play in encouraging innovation and promoting a focus on equity, and in making both possible where public dollars cannot. Collaborating rather than competing with peer funders—including, where appropriate, public agencies—can reduce pressure that intermediaries feel to repackage their work to appeal to different funders’ priorities and will help them maintain focus.
• Fund additional research to understand the true cost and value of various WBL program models, and to continue assessing the potential of different intermediary and partnership formats to deliver quality outcomes and achieve sustainability. This analysis was not designed to link program or system change outcomes with intermediaries’ costs or finance models. Research that does so would be a valuable next step.

These recommendations are not intended to be exhaustive but rather, to provide concrete, achievable steps that, based on our analysis, we believe are needed to support the survival and sustainability of intermediary organizations working to expand work-based learning opportunities for youth.