HIGHER EDUCATION
NJ ’ s Pay It Forward Program : An Innovative Jobs Initiative
New Jersey is committing public dollars to a new career training fund .
Compiled by John Joseph Parker Contributing Editor
New Jersey Governor Phil Murphy and the New Jersey CEO Council , a coalition of Chief Executive Officers ( CEOs ) from some of the state ’ s largest and most widely recognized companies , have launched the New Jersey Pay It Forward Program . This innovative program will provide interest-free and fee-free loans from a revolving fund to support low-income New Jersey career seekers participating in approved training programs . New Jersey is the first state in the country to dedicate public resources to a fund of this nature .
“ As we emerge from the COVID‐19 pandemic , it is crucial that we remain focused on building a stronger , fairer New Jersey economy ,” says Gov . Murphy . “ The New Jersey Pay It Forward Program will play a key role in achieving this goal by opening up new opportunities for New Jerseyans who have been shut out of good , family-sustaining jobs in the past . I am excited to partner with the members of the New Jersey CEO Council to launch this first-in-the-nation program that will bolster New Jersey ’ s recovery from COVID‐19 and set the stage for long-term , equitable economic growth .”
The Pay It Forward Program will provide zero-interest loans and grants to students who are enrolled in non-degree credential and certificate programs at approved training providers . The program will focus on helping students enrolled in short-term training programs that offer high-quality , industry-recognized credentials and certificates in high-demand fields , and participants will not be required to make any repayments until they have successfully completed the training program and their income exceeds a specific level .
The NJ CEO Council arose from meetings of the Governor ’ s Restart and Recovery Commission , named by the Governor in April 2020 to advise the administration on the safe reopening of the state ’ s economy . The Council is made up of the CEOs of BD , Campbell Soup Company , Johnson & Johnson , Merck & Co ., Prudential Financial , PSEG , RWJBarnabas Health , Verizon and Zoetis .
The program is a direct result of the Council ’ s October 2020 pledge to hire or train more than 30,000 New Jersey residents from underrepresented communities of color and other underserved communities by 2030 , and their challenge to the rest of New Jersey ’ s corporate community to train or hire an additional
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“ As we emerge from the COVID‐19 pandemic , it is crucial that we remain focused on building a stronger , fairer New Jersey economy ,” says Gov . Murphy .
40,000 workers . In line with this commitment , CEO Council members have pledged to contribute grants to the Pay It Forward Program , and the state plans to add to this commitment with a grant of approximately $ 5.5 million in FY22 .
“ The pandemic has severely undermined the financial well-being of people across New Jersey , especially in vulnerable communities ,” says Charles Lowrey , chairman and CEO of Prudential Financial , and co-chair of the NJ CEO Council . “ We have seen firsthand how job training can unlock financial opportunity for families , and greater economic mobility for the next generation . Thanks to the commitment of the governor and members of the CEO Council , the Pay It Forward program will help low-income New Jerseyans access training programs that were previously out of reach .”
“ It is incredibly heartening to see so many respected New Jersey companies stepping up to support the recovery of our hardest hit communities as we emerge from this long-lasting and devastating crisis ,” says Kenneth C . Frazier , chairman and CEO of Merck and co-chair of the NJ CEO Council . “ The New Jersey Pay It Forward Program sets a high bar for states and their business communities as the entire country takes stock and rallies to recover from the pandemic .”
To keep costs low for loan recipients , funds provided through the Pay It Forward Program will serve as a “ last-dollar ” option , providing zero-interest loans for only the gap left over after students have exhausted all the free resources for which they are eligible .
To reinforce Governor Murphy ’ s priority for ensuring fair consumer protections while delivering affordable pathways to education and training , the New Jersey Higher Education Student Assistance Authority ( HESAA ) will require all contractors engaged in the Pay It Forward Program to follow strong
Gov . Murphy and the NJ CEO Council have launched an innovative , new education loan program .
student-centric program design criteria . The zero-interest , zero-fee Pay It Forward loans will feature an income-based repayment model that calculates affordable monthly payments as a percentage of participants ’ discretionary income and requires no payments when participants ’ post-training income falls below a certain threshold , enabling trainees to support their families without incurring unmanageable debt .
If repayment is not complete five years after the participant completes the training program , the remaining balance will be forgiven . Participants will also receive wrap-around services such as help with child care and transportation needs as well as stipends to support their living expenses , and they will not be required to repay these non-tuition costs .
This is all possible because the Pay It Forward Program is not designed to turn a profit . Unlike similar private funding mechanisms , the expenses that are repaid by trainees receiving Pay It Forward Loans will recycle back to support the next round of training for their fellow New Jersey residents . Hence the name “ Pay It Forward .”
“ NJ Pay It Forward will enable New Jersey workers whose careers have been derailed by the pandemic and economic turmoil to pursue valuable training that will ease their entry into more lucrative and sustainable jobs ,” explains HESAA
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