Verizon hasn’t laid off any of its 135,000 employees during the pandemic. Instead, the company has retrained around 20,000 workers for new careers.
It’s part of Verizon’s (VZ) responsible business plan announced Tuesday. Dubbed Citizen Verizon, the plan includes a pledge to prepare 500,000 mostly lower-wage people for jobs of the future by 2030 through skills training and job advancement tools.
While it’s an expensive endeavor as other companies cut costs — millions of Americans are now collecting unemployment because of the unprecedented health crisis — Verizon (VZ) chose to focus on retraining workers, CEO Hans Vestberg told CNN Business in an exclusive interview.
“Verizon, as a large corporation, needs to take actions and be responsible here,” said Vestberg, who became CEO two years ago, later adding, “Large corporations have far bigger impacts than governments even, sometimes. We feel that responsibility as a corporation.”
The retraining programs will aim to teach vulnerable populations — especially those whose jobs are threatened by automation — digital skills and provide the mentorship needed to thrive in the modern economy. Verizon said the focus will be on lower-wage workers, including those who work in factories, restaurants and as drivers. There will be an emphasis on young, Black and Hispanic workers who have not gone to college.
As part of Citizen Verizon, the company is creating an education platform designed to support hybrid learning models being used in school districts across the United States. Verizon said the platform will provide digital literacy training for parents, remote learning resources for teachers and tech guidance for school districts. The program aims to provide 10 million children with digital access and skills training by 2030.
Biden calls for end of ‘shareholder capitalism.’ Verizon says it’s already there
In May, Verizon ranked No. 1 in a Forbes and JUST Capital list of the responses to the pandemic among America’s top publicly traded employers.
“Many of the decisions you’re taking in a crisis like this, they will follow you for years because this is when people, customers, employees will remember how we acted,” Vestberg said.
Verizon said it spent nearly $216 million last year in learning and development programs its employees.
The comments come amid a broader debate over the role of Corporate America. Last year, the Business Roundtable said corporations are responsible for improving society by serving all stakeholders — not just shareholders.
Joe Biden, the presumptive Democratic nominee for president, declared in a major speech last week that he will end the era of “shareholder capitalism.”
Vestberg, a former senior executive at Swedish telecom giant Ericsson (ERIC), said that’s “how we act” every day: “We want a positive outcome for all of our stakeholders because ultimately, to have a successful and growing company, the only way is actually to manage your customers, your shareholders, your employees and society.”
But Vestberg stresses that doesn’t mean Verizon isn’t still focused on making money.
“We should grow because ultimately that gives us the liberty to actually act on all the stakeholders,” he said.
Corporate America is ‘not doing enough’ to fix inequality
But the recent protests around racial inequality suggest that far too many Americans have been left behind in the modern economy.
The median net worth of white households is about 10 times the median net worth of Black households, according to the Federal Reserve. The median income for Black households less than 60% of that of white households.
The pandemic is only worsening America’s inequality problem. Nearly 40% of low-income workers lost their jobs in March, the Fed has said. The Black unemployment rate stood at 15.4% in June, compared with 10.1% for Whites.
“It’s clear they’re not doing enough,” Vestberg said of efforts by large companies to narrow those gaps. “Every corporation, every organization needs to do this better in order to create more equality, both here in the US but also in the rest of the world.”