Do you know someone who you could ask at the last minute to take you to work if your car wouldn’t start? It is a situation that most of us will face at some point in our lives, but it is also an illustration of how relationships matter to economic well-being in our daily lives. Over the last 20 years, there has been an emerging recognition that social capital matters. Social capital refers to the networks of relationships among people who live, work, and play together and which enables society to function efficiently and effectively. These relationships may be bonding – designed to cement close relationships of trust and reciprocity among members of the community. Or they may be bridging – designed to connect people together in broader networks of information and resource sharing who might otherwise not be connected.
Consider one nonprofit in central Indiana, which matches disadvantaged residents with stable community leaders for mentorship and social opportunities for a year-long period. The clients of the program choose mentors with whom they feel comfortable, and the mentors provide access to important knowledge such as how to find a job or how to interact in a professional environment. This relationship results in the clients being more career-ready and provides a more stable economic environment for the household.
Many of us at the University of Southern Indiana and Indiana University have studied the relationship between social capital and economic development. We have found that individuals who are connected to strong networks experience economic benefits such as greater job stability, income, and career advancement. This is in addition to social benefits such as feelings of stability, social support, and cohesion. However, I think it is important to note that these benefits accrue not only to individuals but to communities. Those neighborhoods and cities with the strongest networks create the most jobs and have the highest earnings.
This is why, as part of United Way of Southwestern Indiana’s new Pathways to Potential strategy, there is an emphasis on “social stability and growth.” We know programs that strengthen relationships among people make a difference whether that be tight-knit communities that serve as a safety net for their members or strong networks in our communities that expand opportunities for personal and economic growth. By investing in community partners who build social capital, our community creates a pathway to potential for those most in need.