For anyone steeped in civic engagement in America, the importance of the 2020 Census, underway right now, cannot be overstated and is impossible to ignore. The count determines how government distributes some one trillion dollars. It also apportions Congressional and state-level legislative seats, thus fundamentally shaping — and being shaped by — our democracy.

But how specifically does census data affect the work of impact investors and philanthropists?

The answer is: What doesn’t it affect?

Census data has underpinned every aspect of community development finance for roughly 50 years. As the backbone of the Community Reinvestment Act, Census data is the primary way of directing investments to low-income neighborhoods. It is also the basis of eligibility requirements for the federal Opportunity Zone program, a key feature of the Tax Cut and Jobs Act of 2017.

Census data also affects investors in myriad indirect ways. It shapes our understanding of wealth and income inequality by mapping, for instance, household income by race and gender, where for the last 60 years Black and Hispanic people consistently earned less than their White and Asian counterparts. It illuminates population patterns showing greater diversity in some places and migration in others.

This data helps impact investors to craft strategy, raising important questions about whether philanthropy can or should do more to engender measurable positive outcomes or arrest harmful trends.

And in 2020, it may be more challenging than ever to complete an accurate Census count.

Inaccurate Data: A Quadruple Whammy in Stark Relief

Current projections suggest that up to 1.5% of the American populace may be undercounted. Yet that’s not the full story. Disaggregating those projections suggests that children under four years old could be undercounted by up to 6.3%, Latinx people by 3.6%, Black people by 3.7%, American Indian/Native Alaskan people by 2.1% and Asian-American/Pacific Islander/Native Hawaiian people by 1.4%.

Though hard-to-count populations and structural challenges to the Census have always existed, in 2020 we face a steeper challenge. Outreach to hard-to-count populations may have been insufficient. Complete count committees, which manage regional efforts, are not active in all states and communities. And although we’ve hit a major milestone in developing the first ever online census survey, it is not equally accessible for people without computers, internet access, or who may be less tech savvy.

Evidence also suggests that general mistrust of the federal government, particularly by immigrants, refugees, and people of color may lead to significant numbers of people opting out of this census. While much has been done by philanthropy and civil society to support efforts to dispel inaccurate messages and get out the count, challenges persist.

This census is also entering a critical phase during an unprecedented national emergency as COVID-19 reached pandemic status in March. Social distancing necessitates a decline in community engagement, yet one-to-one outreach is exactly what’s needed to spread the word to harder-to-reach communities or those for whom online participation is unavailable. Further, many of the very same communities that would bear the brunt of an economic recession would also experience the negative effects of not being counted when recovery funds are being distributed.

Together, these and other factors have created serious uncertainties for our nation’s most essential data gathering effort.

We’re in This Together ... And Together We Rise!

As we reach the final critical stretch of the census, the administration has extended deadlines by up to two weeks in most cases, giving donors and impact investors more time to reach out to their neighborhood organizations or Complete Count Committees to support mobilization efforts as the nation weathers the COVID-19 crisis and other storms.

Simultaneously, we must prepare for the likelihood that the 2020 Census data may not be reliable for the next decade. If this comes true, what are the ramifications for our decision-making processes, as well as our impact goals. What other sources of data, whether records from government agencies or new big data solutions being created by social enterprises, would we need to invest in, learn how to use, or make publicly available? And what can we do to fill the gaps quickly, collectively and equitably?

With thoughtful collaboration, we can adopt strategies to help inoculate communities against census undercount threats, COVID-19, and an economic downturn. To do this we must work in proactive partnership, incorporating community voices, to usher in a new regenerative normal, delivering on our shared positive social impact goals.

The impact investing field has grown over the last decade as a result of hundreds of individuals and philanthropic institutions recognizing the need to collaborate to solve our collective challenges. Let us rise to the occasion again, now, to deliver on the promise of our outcomes-focused missions and impact investment theses. The world is watching.

Resources:

Webinar: Census 2020- Why and How It Matters for Impact Investing

Why Your Foundation Should Become a 2020 Census Official Partner

Funders Committee for Civic Participation: Redistricting Resources

National League of Cities Municipal Action Guide
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By Monique Aiken, Vice President, Mission Investors Exchange.