Too many people are being shut out of the rewards of a growing economy, and the frustration and disillusionment that follow have had deep and far-reaching impacts. Creating greater economic opportunity must be a responsibility and an imperative for all of us.
During the past five years, my colleagues and I at JPMorgan Chase have undertaken significant long-term initiatives focused on this imperative. We’re targeting a limited number of areas where we believe we can have the greatest impact. While we deployed approximately $250 million globally in 2016 toward these efforts, we know that money alone won’t solve these challenges. Instead, our mantra has become, “Work the problem.” That means understanding precisely the social or economic challenge we’re trying to address and deploying the skills, expertise, data, relationships and resources that contribute to positive outcomes.
We have too often seen well-intentioned money — both public and private — fail to result in long-term impact. So a critical and deliberate part of our strategy is strengthening the underlying organizations and systems that are needed to empower communities to deliver and sustain change.
Our work around the world has made two things clear. The first is that there are some universal drivers of inclusive growth, which include workforce development — getting more people the skills they need to succeed in today’s economy — small business expansion, financial health and neighborhood revitalization. The second is that making real impact requires the private sector to play a much more active role. Companies must leverage their unique assets to help solve problems — not simply give away money and hope for the best.
Three years ago in Detroit we launched our most comprehensive initiative to date, which we view as “proof of concept” of our firm’s model. We have made Detroit the focus of our Corporate Responsibility Report this year because it provides insights that are informing our efforts elsewhere. While our primary focus is Detroit, we also showcase examples of our model at work beyond Detroit.
Our work in Detroit has also yielded lessons that we think can be instructive for others. Chief among these is the need to bring an innovation mindset and a willingness to adjust. For example, we initially focused on incubators to drive small business growth, but it became clear that we could have greater impact by providing minority entrepreneurs with much-needed capital. As a result, we shifted our strategy. With data from the JPMorgan Chase Institute showing that local spending at small businesses has grown faster in Detroit than in other major cities we track, we are confident we are now focused where we can best move the needle. We’ve since expanded this approach to small businesses in other communities.
Equally important, we’ve learned firsthand the power and necessity of collaboration. Detroit’s turnaround has been possible only because government, businesses and nonprofits all came to the table and asked, “What value can each of us provide to solve these challenges?”
The model JPMorgan Chase put into practice in Detroit is making a real impact, but as we learn more about what’s most effective, we continue to refine it. I hope the lessons we have learned in Detroit and elsewhere around the world can help spark a conversation across all sectors about better approaches to solving our challenges and creating greater economic opportunity for all.