N.J. launches Pay It Forward Program to prep workforce, support economic growth

First-in-nation initiative will provide zero-interest, no-fee loans to enable students to train for family-sustaining careers and power N.J.’s economy

A new and innovative workforce development program launched Wednesday to help New Jerseyans get education and training necessary to advance their careers.

Gov. Phil Murphy, together with the New Jersey CEO Council and Social Finance, have initiated the New Jersey Pay It Forward Program intended to help build a robust and talented workforce while supporting economic growth in the state. Participants in the program will receive zero-interest, no-fee loans at no upfront cost, as well as non-repayable living stipends and wraparound supports, to allow them to affordably prepare for good-paying, career-track jobs in the health care, information technology and clean energy sectors.

“With today’s launch of Pay It Forward, New Jersey is the first state in the nation to model this innovative approach that will help residents obtain family-sustaining jobs and then pay their success forward by supporting future cohorts of students,” Murphy said. “This initiative is another way in which my administration is working to give more residents access to high-quality education and training that will lead to good-paying jobs and successful careers.”

According to the Wednesday announcement, the loans will enable participants to enroll in credential, certificate and degree programs at one of three inaugural training providers: Registered Nursing at Hudson County Community College, cybersecurity at New Jersey Institute of Technology, and heating, ventilation and air conditioning (HVAC) and welding at Camden County College. Loan terms are designed to be more borrower-friendly than even federal student loans.

All loan payments will be recycled back into the fund to “pay it forward” for subsequent students’ training costs. The program aims to help participants find jobs while also helping employers fill in-demand positions in high-growth sectors to promote economic growth in New Jersey.

Participants who find jobs earning above a specific income threshold will repay the cost of their tuition over time. Any loan balance remaining after five years will be forgiven for borrowers in good standing. To help them succeed throughout the program, participants will also receive living stipends and free wraparound supports, including access to an emergency aid fund and mental health counseling services. Under the program, students will not have to repay the living stipends or wraparound supports. The loans are intended to be a last-dollar option, allowing students to maximize the free resources available to them to minimize the amount they need to repay.

Members of the New Jersey CEO Council, a coalition of CEOs from some of the state’s largest and most widely recognized companies, provided corporate contributions of approximately $5 million to the Pay It Forward Program. The state added to this commitment with appropriations of $5 million in Fiscal Year 2022 and $2.5 million in Fiscal Year 2023. The CEO Council is made up of the CEOs of BD, Campbell Soup Co., Johnson & Johnson, Merck & Co., Prudential Financial, Public Service Enterprise Group, RWJBarnabas Health and Verizon.

“We’re excited to partner with the state of New Jersey and the CEO Council to launch this first-of-its kind public-private partnership that brings the state’s economic and workforce development priorities together,” Tracy Palandjian, CEO and co-founder of Social Finance, the nonprofit designing and managing the fund, said. “This sustainable, innovative fund is helping to advance New Jersey’s business goals while putting the learner’s success at the center of the arrangement.”

The New Jersey Pay It Forward Program plans to partner with additional training providers in the coming months.