On Thursday, JPMorgan Chase & Co. announced a $40 million investment over three years to create economic opportunity in Chicago’s underserved neighborhoods on the South and West Sides. A lack of opportunity is a root cause of Chicago’s gun violence, concentrated poverty, and persistent racial and economic inequities, so the firm’s investments will focus on key drivers of inclusive economic growth including jobs and skills development, small business expansion, neighborhood revitalization and financial health.
“Chicago is one of America’s greatest cities, but not every resident shares equally in the city’s economic growth,” said Jamie Dimon, Chairman and CEO, JPMorgan Chase. “It is on us – leaders in business – to step up, collaborate with government and the community and develop solutions where we have resources and expertise to offer. We believe in Chicago’s future and are hopeful our investment will help the city thrive and make opportunity available to every Chicagoan.”
How the Firm is Creating Economic Opportunity
JPMorgan Chase makes about $250 million in annual philanthropic investments to create opportunity across the U.S. and in 40 countries around the world. To ensure the greatest impact, the firm combines data with its business expertise—including human capital, management expertise, and partnerships—to create opportunity in underserved communities.
JPMorgan Chase’s investments in Chicago, Detroit and other cities focus on four strategic drivers of inclusive growth: preparing people for in-demand careers, helping small businesses expand, revitalizing neighborhoods, and improving financial health.
Over the last five years, the firm has developed several global initiatives based on these strategic drivers. These initiatives are specifically focused on equipping workers with critical skills, helping women and minority-owned entrepreneurs by providing them with the capital and expertise they need to grow, revitalizing underserved neighborhoods by investing in locally driven solutions and helping individuals get the skills and tools needed to build strong financial futures. JPMorgan Chase also actively seeks to use its most important asset—the expertise and commitment of the firm’s employees— to maximize the impact of its philanthropic investments and help nonprofit partners expand and better serve their communities.
“By bringing together a broad coalition of civic, corporate and community partners to create jobs and invest in neighborhoods, we can drive change that will last for generations,” said Chicago Mayor Rahm Emanuel. “Today we have the opportunity to build a powerful coalition with JPMorgan Chase that will create economic opportunities in communities across Chicago.”
In Chicago, the firm is bringing its experience addressing economic opportunity through these global initiatives to the South and West Sides. It is also applying lessons learned from its investments in Detroit and other cities, including collaborating with business, nonprofit, and government leaders and strengthening underlying organizations and systems, to create a more lasting community impact.
“JPMorgan Chase uses the same strategies that drive business success—innovation, ingenuity, and focus—to drive change most effectively in communities,” said Peter Scher, Head of Corporate Responsibility, JPMorgan Chase. “We look to see where we can move the needle and make the biggest difference, relying on data and the expertise of our people to strengthen our investments. In Chicago, we will take what we’ve learned in other cities to invest in the communities that have been left behind.”
The firm will focus its $40 million Chicago investment on these four key drivers of economic opportunity. To drive sustainable change in collaboration with others, the firm’s investment in these priority areas will help strengthen nonprofit organizations in many ways including helping to make them more financially resilient so that they can better serve low-income communities and communities of color.
· Preparing Residents for In-Demand, Good Paying Jobs: To help address unemployment in some of Chicago’s South and West Side neighborhoods, which exceeds 30 percent, the firm is partnering with employers and training institutions, such as Advocate Healthcare, City Colleges of Chicago, the Brazier Foundation and Heartland Alliance’s Rapid Employment and Development Initiative. These programs work to help Chicagoans get the skills they need to secure high-quality jobs in growing fields like healthcare and advanced manufacturing. Also, the firm is expanding The Fellowship Initiative (TFI), an intensive academic leadership, mentoring and development program for young men of color from Chicago to prepare for college and their future careers. In total, 117 students from Chicago, Dallas, Los Angeles and New York City graduated from TFI this year and are heading to college, 39 of which are from Chicago. Another 200 Fellows are currently in the program including 60 from Chicago.
· Investing in Neighborhood Revitalization: According to analysis conducted by Next Street, there is an unmet need of $400 million in investment capital to rebuild and transform Chicago’s neighborhoods. To address this challenge, JPMorgan Chase is investing in the Chicago Community Loan Fund and Chicago Neighborhood Initiatives to finance critical projects that help turn around struggling neighborhoods. Going forward, financing will provide and leverage capital for residential, commercial and retail development projects that often lack access to conventional financing, spurring others to invest. Other support focuses on creating and preserving affordable housing through creative financing led by the Community Investment Corporation.
Growing Underserved Small Businesses: Small businesses act as engines that drive economic stability—creating jobs, contributing to vibrant neighborhoods, stimulating innovation and powering the regional economy. Yet research shows a lack of capital flowing into minority-owned businesses in Chicago. Working with Chase for Business, the firm’s business banking, merchant services and credit card arm that serves small businesses, this investment will help build a pipeline of lending referrals to external Community Development Financial Institutions, such as Accion, to help underserved businesses gain access to credit. The investment will also support the firm’s Ascend 2020 program to expand access to capital and technical assistance to primarily minority-owned small businesses and entrepreneurs.
· Creating Financially Healthy Families: The firm is investing in financial capability programs that support innovative new products and services that leverage technology and insights to help consumers weather financial shocks through increased savings, improved credit and personal asset growth. Out of about 1 million Chicago households, 650,000 are financially insecure (less than $2,000 in savings), and 38 percent of residents have a subprime credit score, according to the Urban Institute. In Chicago, the firm’s support is strengthening families and communities by improving employment and racial equity outcomes and is building on its existing partnerships with the Center for Economic Progress and Ladder Up, The Resurrection Project, Mercy Housing Lakefront, Neighborhood Housing Services, and the University of Chicago Poverty Lab to improve financial health.
Leveraging Key JPMorgan Chase Assets
To support Chicagoans, the firm will leverage its most important assets including the expertise and commitment of their employees through the Service Corps and lines of business, data-driven analyses from the JPMorgan Chase Institute and financing through the firm’s Community Development Banking group for projects that expand economic opportunity.
The firm’s Community Development Banking group will commit $110 million over the next three years in financing for projects that expand opportunity and help revitalize key neighborhoods. The Community Development Banking group has significant experience deploying capital and credit for the creation of affordable housing, retail space and community facilities in Chicago’s most underserved communities. Past projects include the Chicago Center for Arts and Technology and the Salvation Army Freedom Center as well as health and recreation facilities such as PCC Medical Center and MetroSquash and affordable housing such as the Preservation of Affordable Housing buildings on the South side.
Also, the firm will continue to bring highly-skilled employees to Chicago to support nonprofits in key neighborhoods. The Service Corps, a three week, skills-based volunteer program, allows the firm’s top-performing employees to share their expertise with nonprofit partners to expand their community impact. The firm’s first Service Corps team in Chicago recently worked with BSD Industries, a robotics technician training program in the Woodlawn neighborhood, to create a viable expansion sourcing for the development of green cutlery. In total, 45 employees over the next few years will volunteer their expertise with key Chicago nonprofits.