In 2022, we connected 144 immigrants with higher education who were looking for a relevant job with personal mentors. After six months, 31% had secured a relevant job, and 50% had done so within a year. This corresponds to a socioeconomic savings of approximately 20.3 million kroner, according to an external study conducted by Wilstar Social Impact (Wilstar, 2022). This amounts to a savings of approximately 141,000 kroner per participant, or 7.4 kroner in societal benefit for every kroner invested in Sammen om en jobb. In this article, we take a closer look at how we measure the socioeconomic impact of our work and how we ensure the quality of our data.
Measuring socioeconomic impact—that is, quantifying the economic savings generated by a given initiative—is both important and difficult. A term frequently used in this context is “Social Return on Investment” (SROI), which refers to the amount of social impact generated for every krone invested in the project. In 2022, the mentoring program had Sammen om en jobb an SROI of 7.4 kr. This means that for nearly 2.7 million kroner received in funding in 2022, the program generated an estimated socioeconomic impact of 20.3 million. This makes the mentoring program a highly effective initiative.
Looking at SROI is important for comparing the mentoring program with other initiatives, so that we invest our time, effort, and money where the impact on society is greatest. Such priorities are important whether you’re one of the world’s richest countries allocating nearly 1,900 billion through the national budget, or a small nonprofit organization managing two to three million in grants.
The idea of using mathematics to determine the best societal solutions may sound too good to be true, and, like so many other things, the reality is often a bit more complicated than a mathematical calculation with two lines under the answer. Any calculation of socioeconomic impact will always be based on certain estimates and assumptions. Sometimes these will be quite accurate and close to reality; other times, the assumptions are more rough, and there is greater uncertainty surrounding the figures.
In the remainder of this article, we will explain as simply as possible how we go about measuring our socioeconomic impact, what assumptions we make, what uncertainties we encounter, and how we ensure that the results are as realistic as possible.
How is social value created?
The first thing we need to identify in order to determine the socioeconomic impact is the various ways in which the program creates value. Most of the value created by getting people into relevant job comes from increased production, tax revenue, reduced spending on benefits and employment-related measures, as well as unpriced costs associated with poorer health, lower quality of life, and reduced social participation (Hyggen and Ekhaugen, 2021). Since some of these costs are very difficult to quantify, we focus solely on costs directly related to being overqualified for one’s job and not being able to realize one’s full potential. According to Vista Analyse, the total cost of 28,000 immigrants being in jobs for which they were overqualified in 2017 was 5–6 billion Norwegian kroner, or approximately 230,000 Norwegian kroner per person, adjusted for inflation (Vista Analyse, 2017).
Efficiency
In 2022, we matched 144 immigrants with higher education to personal mentors with the goal of supporting them on their path to a relevant job. Total operating costs for the entire organization that year were 2,654,520 NOK—or approximately 18,400 NOK per match. By comparison, the average cost per pairing for all IMDi-supported mentoring programs in 2016 was 41,500 kr, or nearly 50,000 kr adjusted for inflation through 2022 (IMDi, 2016). This makes us one of the country’s most cost-effective mentoring programs, but says nothing about the actual social impact. A cost-effective program that fails to achieve results is still a poor use of resources. Therefore, we must examine what participants gain from the program.
Results
Of the 144 people who participated in the mentoring program in 2022, 31% received a “ relevant job ” during the program itself, and 50% in the six months that followed. The socioeconomic value of this will be:
144 people * 0.5 employed * 230,000 NOK in societal savings per employed person = 16.6 million NOK
This means that the total value of getting people into jobs in 2022 was approximately 16.6 million. However, none of this is solely due to the efforts of Sammen om en jobb . Many received help from other sources or found jobs on their own.
Our share of the profits
That is why we ask participants what role the mentoring program played in their finding a job. Of those who find a job, 89% report that the mentoring program played an important (4/5) or decisive (5/5) role. Therefore, we can say that the mentoring program has contributed to 89% of the effect of getting people into jobs:
16.6 million * 0.89 = 14.8 million.
Although Sammen om en jobb was instrumental in helping many people find jobs, it is likely that some or most of them would have found a relevant job on their own sooner or later. We must therefore take into account that the mentoring program merely accelerated the process. The figure above represents the annual socioeconomic savings achieved by helping people find relevant job.
Annual vs. Total Societal Impact
If, on average, the participants had found jobs exactly one year later, the total savings would also have been 14.8 million. If participants had, on average, found a job on their own after half a year, the figure would be halved, and if participants had never entered the workforce, the figure could be multiplied by the average number of years participants have left before retirement age. In other words, we’re talking about very large margins, and we’re now really starting to work with rough estimates.
By looking at how long participants had been trying to find relevant job before the program began, we estimate that, on average, it would have taken a year and a half to find a job without the mentoring program. This means that many would have found a job faster, some would have taken significantly longer, and a few would never have entered the relevant job at all. The calculation of the total socioeconomic impact in 2022 is then:
14.8 million NOK in annual socioeconomic benefits * 1.5 years = 22.2 million NOK in total socioeconomic benefits
The NOK 22.2 million in socioeconomic benefits generated in 2022 is relatively similar to the external analysis conducted by Wilstar and EY (NOK 20.3 million), which may indicate that the figures are quite realistic (see this analysis at the bottom of the article).
To calculate the average societal impact of getting one participant into a job, we can divide this figure by the number of participants:
22.2 million NOK / 144 participants = 154,000 NOK
Social Return on Investment
By dividing the total socioeconomic value created in 2022 by Sammen om en jobb ’s total costs for the same year, we arrive at our “social return on non-investment”:
22.2 million NOK / 2.7 million NOK = 8.2 NOK
This means that for every krone invested in Sammen om en jobb , 8.2 krones in social impact is generated.
Conclusion
This is a simplified calculation of our socioeconomic impact, and of course, the reality is more complex; we must therefore take into account that the actual socioeconomic impact could be somewhat higher or lower. Nevertheless, the figures clearly indicate that supporting talented individuals on their path to a “ relevant job ” through a mentoring program is an excellent investment in society!
Not included in this calculation are all the indirect costs associated with improved physical and mental health among participants, increased social participation and a sense of belonging, the creation of role models in local communities, and greater diversity in the Norwegian workforce. Nor have we factored in the impact of 144 mentors gaining greater knowledge and experience with diversity, mentoring, and multicultural communication, or the ripple effects the program has in shifting the public debate toward recognizing the potential and resources of immigrants who bring a wealth of skills and motivation.
References
Hyggen, C. and Ekhaugen, T. (2021). Socioeconomic Assessment of Marginalization and Social Exclusion. Ministry of Children and Families.
IMDi (2016). Summary of Experiences from Mentoring Programs. Directorate of Integration and Diversity.
Vista Analyse (2017). Overqualified Immigrants in Low-Wage Jobs. Aftenposten.
Wilstar, (2022). Impact Report 2022. Wilstar Social Impact.
Socio-economic analysis of the “ Sammen om en jobb ” mentoring program, conducted by Wilstar and quality-assured by EY.