Why the Workforce Investment Act Matters — Part III

This is the third in a series on the Workforce Investment Act (WIA) and NLC’s belief that Congress must reauthorize and modernize the Act to ensure that it meets the needs of today’s workers and employers. In this third blog we will explore how these locally-based job training programs have translated into real world outcomes that have benefited unemployed, underemployed and economically disadvantaged adults and youth throughout the United States.

Why the Workforce Investment Act Matters — Part III

By Neil Bomberg

Having looked at the ways in which the Workforce Investment Act (WIA) is structured and operated, it is now worth asking how has the nation’s Workforce Investment Act system performed?

A review of national data suggests that it has performed very well. Overall outcomes are extremely good, especially when one considers that many WIA participants are among the most difficult to help find work.

According to the U.S. Department of Labor, 81 percent of all participants and 80 percent of all employers who participated in the WIA system said they were satisfied with the assistance they received.

Among low-income adults who participated in WIA programs:

• Fifty-five percent obtained employment. While this number is lower than it should be (the goal was 72 percent) it is significantly higher than the placement rate for non-WIA individuals, which is less than 25 percent.
• Eighty percent of those who obtained employment remained on the job after six months and 72 percent found a job which matched their skills levels.
• Seventy percent who received job training entered employment and 87 percent of those remained on the job more than six months.

Among dislocated workers who participated in WIA programs:

• Fifty-seven percent obtained employment as a result of their participation in WIA. Like the adult figure, this is lower than it should have been (the goal was 77 percent) but it more than twice the placement rate for non-WIA individuals which is 25 percent.
• Eighty-eight percent of those dislocated workers who obtained employment remained on the job after six months.
• Of those dislocated workers who received job training services 78 percent entered employment and 90 percent of those remained on the job after six months.

Among youth aged 19 to 24, 63 percent entered employment or returned to school, 57 percent obtained a degree or certificate, and 38 percent made measurable literacy and numeracy gains. Among youth aged 14 to 18, 87 reached their desired skills attainment levels and 67 percent obtained a diploma or its equivalent.

Why the Workforce Investment Act Matters — Part II

This is the second in a series on the Workforce Investment Act (WIA) and NLC’s belief that Congress must reauthorize and modernize the Act to ensure that it meets the needs of today’s workers and employers. In this second blog we will explore how and why job training services are offered and what role the local workforce investment boards and city and county elected officials play in the development and implementation of these services.

Why the Workforce Investment Act Matters — Part II

By Neil Bomberg

Job training services provided by the federally-funded and locally-operated Workforce Investment Act (WIA) take many forms, so that the services provided can meet an individual worker’s or employer’s needs. Services can include classroom training, customized training, and on-the-job training, or some combination of all three.

Training funds typically are distributed through individual training accounts that provide vouchers to job seekers; those searching for work then use the vouchers to enroll in eligible training programs approved and made available by the local workforce investment boards to meet specific employer needs within their communities. However, these vouchers are only issued after local workforce investment boards and city and county elected officials work with businesses within their communities to identify what types of job openings that exist, the kinds of skills that are necessary to fill those positions, and the availability of appropriate training programs within their community. In other words, individuals cannot simply decide to opt for a certain type of training unless it can be shown that there are opportunities to work in the field for which training is offered. (In a forthcoming blog examples of how this is done will be provided.)

Each job training program is designed to help workers gain new skill sets or upgrade existing skill sets, while providing them with some support services such as child care and transportation assistance, so that they can complete their job training program and move into a permanent full-time position that improves each participants employability and earnings. Often, training is provided by local community colleges who have worked with local employers to identify which jobs are growing in the community; other times it may be offered by a company that has determined that it is going to expand operations and needs new, skilled employees to fill those jobs. Still other times training may be offered by a local public-public private partnership that has been created to bring job seekers into a specific sector such as health care, hospitality, retail, construction or manufacturing.

Most importantly, there is no single way to implement an effective local workforce development program. It must be responsive to the specific needs of employers and workers alike, and it must be based on the labor situation within a given community; something that local workforce boards make up of local business leaders and city and county elected officials are particularly skilled at doing.

Why the Workforce Act Matters — Part I

This is the first in a series on the Workforce Investment Act (WIA) and the belief by the National League of Cities (NLC) that Congress must reauthorize and modernize the Act to ensure that it meets the needs of today’s workers and employers. In this first blog we will explore the foundation of the program, which is commonly referred to as the local public-private partnership (which includes local business leaders and local city and county elected officials), the one-stop system, and how these translate programmatically at the local level.

Over the next five weeks, NLC will publish other blogs that will address the kinds of job training that WIA programs offer, the impact that these programs have on workers and employers, some examples of effective programs, the kinds of changes to WIA NLC can and cannot support, and what members of the Human Development Committee are doing to ensure that the Congress is aware of city elected officials legislative wants and concerns.

Why the Workforce Investment Act Matters — Part I

By Neil Bomberg

Every year, the federal government invests billions of dollars in the nation’s workforce development system. Among the programs funded is the Workforce Investment Act (WIA) which provides training and employment services to millions of unemployed, underemployed and disadvantaged Americans through a national network of one-stop career centers that are governed by local workforce investment boards and city and county elected officials.

When WIA became law in 1998 it included a completely new and innovative approach to delivering workforce development services. One-stop career centers have become the backbone of a seamless employment-services delivery system in every state. These one stops are operated and governed at the local level by local workforce boards, comprised of business leaders, and city and county elected officials. They make up the public-private partnership for which this program is known.

The one-stops have provided workers and employers alike with access to the full range of employment services that have included job placement assistance, training, credentialing, unemployment benefits and career guidance, as well as access to other relevant government services, including 17 types of federal training and education programs. Over the past several years, these one-stop centers have successfully provided upwards of nine million Americans per year with employment assistance and millions of employers with skilled workers.

Most of the nine million Americans who enter the WIA system receive “core services” which are generally described as job search and job placement assistance, labor-market information, workplace counseling, and preliminary skills assessments. Others receive “intensive services” which are generally described as comprehensive skills assessments, group counseling, individual career counseling, case management, and short-term pre-vocational services, such as how to write a résumé and prepare for an interview. Both of these services are designed to help those looking for work and who have employable skills, find a job quickly. A smaller number receive “job training services.” These are designed to provide WIA clients with industry-recognized skills so that they may obtain employment, especially after core and intensive services do not result in finding a job.

The Ryan Budget Will Impact Worker Skills and Job Growth

By Neil Bomberg, Program Director

Last week, the House of Representatives passed Chairman Ryan’s budget resolution.  Though it has no chance of passing by the Senate, it will have an impact on the way in which the House allocates funds to various line items in the appropriations process.  My view is, and this is a view shared by many who are much smarter than I, that if the Ryan budget became law that the doors to our nation’s federal job training system would be shut, and a significant amount of Pell Grant funding would be eliminated.   Millions of Americans would be denied access to the skills and credentials training and job placement assistance they need to succeed in today’s labor market.  In addition, it would stifle the ability of U.S. businesses to find the skilled workers they need to take advantage of new markets and emerging economic opportunities, putting our nation at a competitive disadvantage at a time when other countries are increasing their investments in developing their human capital.

But that is not all.  The Economic Policy Institute (EPI) argues that Paul Ryan’s latest budget would not only cut funding for important domestic programs like the Workforce Investment Act (WIA) and Pell, would not only aggressively slow job growth, but actually would eliminate jobs – millions of them.

According to EPI, the magnitude of the Ryan budget cuts would suck demand out of the economy when it most needs it, just as it is returning from the single greatest financial meltdown since the Great Depression.  Moreover, EPI concludes that by simply using a “standard macroeconomic model that is consistent with that used by private- and public-sector forecasters, the shock to aggregate demand from near-term spending cuts would result in roughly 1.3 million jobs lost in 2013 and 2.8 million jobs lost in 2014, or 4.1 million jobs over two years.”

While the National League of Cities (NLC) recognizes the challenging fiscal environment faced by lawmakers, NLC also believes that the United States simply cannot afford to make additional cuts to these important education and training programs.  Without access to these programs, millions of Americans will go without the skills training and credentials they need to enter the world of work.  They will be unable to compete in the current labor market.  Worst, they will remain unemployed or work in low wage jobs that will further contribute to their economic isolation.

To avoid this, NLC is calling on Congress to take several proactive steps.  The first is, within the constraints established by the Budget Control Act of 2011, continue to invest in programs that provide job training and educational assistance.  The second is to reform and modernize the Workforce Investment Act and the nation’s education laws so that they reflect the education and training outcomes that will be demanded over the next decade.  Without this level of support, the United States will not be able to continue to compete internationally and grow economically, and it will find itself falling behind.

Congress Should Not Follow Paul Ryan’s Plan and Cut or Eliminate Job Training and Pell Grant Programs

By Neil Bomberg, Program Director

It is hard to understand, when one looks at the program outcomes for the Pell Grant program and the Workforce Investment Act (WIA), why House Budget Chairman Paul Ryan wants to cut or eliminate their funding.  Both appear to be helping Americans obtain the job skills and education they need for the 21st century workplace.

The U.S. Department of Labor reports that there is great demand for job training and job placement services.  Last year, more than nine million Americans received training and related services through the federally-supported workforce investment system – an increase of nearly 250 percent over the previous two years – and more than half of those individuals found employment in one of the toughest labor markets in history, in large part because of the assistance they received.

According to the U.S. Department of Education, nearly 10 million individuals relied on Pell grants last year, including many who were attending school while continuing to work full-time to support their families.

Critics argue that the outcomes for WIA participants and Pell Grant recipients — slightly more than half of WIA participants find jobs as a result of their participation in the WIA system, and 40 percent of Pell Grant recipients graduate from four year colleges after six years of study – are not sufficient to justify continued funding.  However, I would argue that these numbers are actually impressive when taken in context.

Fewer than 30 percent of all unemployed Americans can expect to find a job in the first month of unemployment, and that number decreases rapidly to less than 20 percent when one is unemployed for more than six months, according to the Brookings Institution.  Equally compelling is the fact that there is only one job opening for every four unemployed individuals, according to the Economic Policy Institute, suggesting that a placement rate greater than 25 percent is exceptional.  Yet WIA’s placement rate exceeds 50 percent.

Though the difference in graduation rates after six years for Pell and non-Pell students who enter four year institutions is significant – 55 v. 40 percent – the difference is explainable.  Pell Grant recipients are among the poorest students, and face significant financial challenges while in school.  Many cannot afford to complete their educations because of these financial challenges.  They are likely to be older than most students, which generally means that they have family and related obligations that non-Pell students do not have, thereby making it more difficult to complete college.  They are more likely to be first generation post-secondary students and come from families with very low academic achievement.  According to Inside Higher Ed more than 40 percent of Pell recipients come from families with a high school diploma or less as compared with non-Pell students where the rate is only 20 percent.  Conversely, 61 percent of non-Pell students come from families with a bachelor’s degrees or higher, as compared with 36 percent for Pell recipients.

Finally, if our goal is to ensure that more people than not have access to a post-secondary education, in large part so that they can compete in the 21st century economy, then Pell Grants are succeeding.  Over the past five years, the number of community college students receiving Pell Grants nearly doubled, according to the American Association of Community Colleges (AACC), and in the past academic year, the number of recipients increased by 21 percent.

From where I sit, these data suggest that the Workforce Investment Act and the Pell Grant program have, in very different ways, made significant impacts on the populations they are designed to serve, and from NLC’s perspective, warrant continued support.

The Impact of Rep. Paul Ryan’s Budget on Federal Job Training Programs

By Neil Bomberg, Program Director

As I read through the budget proposed by House of Representatives Budget Committee Chairman Paul Ryan (R-WI), I was left wondering why House Republicans are so vigorously opposed to job training programs like the Workforce Investment Act (WIA).  This program – which helps private sector employers find and train skilled workers – is being vilified as wasteful, duplicative, and welfare-like, despite substantial evidence to the contrary from researchers and the Government Accountability Office (GAO).   Most confusing is the fact that these proposed cuts are coming at a time when more than 13 million Americans remain out of work and employers across America are complaining that the existing skills mismatch is preventing them from filling some 3.5 million jobs.

What does the Ryan budget mean for the nation’s Workforce Investment Act job training system?

If the Ryan budget were adopted into law, funding for federal job training programs that would help U.S. workers and employers obtain critical workforce skills would be virtually eliminated.  According to the Campaign to Invest in America’s Workforce (CIAW), the “Ryan Budget” would reduce the budget line that funds labor, health and human services, and education programs by more than $16 billion (22 percent) when compared to fiscal year 2012.

Why has Chairman Ryan proposed to cut funding for Workforce Investment Act job training programs?

Chairman Ryan argues for these cuts, in part, by suggesting that federal job training programs are duplicative and ineffective.  He cites a January 2011 report from the GAO  as proof. But this represents a fundamental misreading of that report; in fact, while the GAO found that a number of federal programs offer similar services the report clearly stated that “even when programs overlap, the services they provide and the populations they serve may differ in meaningful ways.” And, GAO recently affirmed the value of well-designed public-private job training partnerships, noting in a January 2012 report that these initiatives have helped to meet vital employer skill needs in communities across the nation while helping jobseekers get and keep well-paying jobs in high-growth and in-demand industries.