Congress Moves Toward a Better Workforce Development System

June 23, 2014

Congress may soon do a remarkable thing — pass a significant, non-urgent bill on a bipartisan basis. We can’t be sure, of course. But advocates are justifiably hopeful.

The bill I’m referring to would reauthorize the Workforce Investment Act — the single largest source of federal funds for a broad range of programs and services that help people prepare for and find work. Or looked at another way, that provide employers with workers whose skills match their needs.

WIA hasn’t been reauthorized since it was created in 1998. Needless to say, the labor market has changed since then, as have the needs of people who want to enter it, re-enter it or move up from dead-end, low-wage jobs.

That’s not all that’s changed. State and local agencies have gained experience — not altogether happy — with the administrative complexities the current law imposes.

And experts have noted some perverse incentives, created partly — but not entirely — but funding cuts that predate the Budget Control Act caps and across-the-board cuts. Those, of course, have only made matters worse.

Most importantly perhaps, thinking about how workforce development programs should be structured has evolved. So have views on how public agencies and their contractors should be held accountable — and for what.

All of which brings us to the proposed Workforce Innovation and Opportunity Act — proclaimed by key Republicans and Democrats both as a “bicameral, bipartisan … deal to improve the nation’s workforce development system.”

Getting to this point wasn’t easy. Last year, House Republicans crafted — and with scant help from Democrats, passed — a bill that would have eliminated 35 WIA programs and effectively rolled the rest into a block grant, with funds frozen for seven years at the Fiscal Year 2014 level.

The effect, as the White House said, would have been to shortchange the needs of “vulnerable populations” who face “significant barriers to employment.”

So one of the best things we can say about the new bill is that the block grant is dead. The basic WIA structure remains the same, ensuring that each top-level component — job training, employment services, adult basic education and vocational rehabilitation for people with disabilities — gets funding.

At the same time — and here’s where things get interesting — states must develop a single, comprehensive plan for all “core” programs for both eligible youth and adults, including those with disabilities and those who are “dislocated,” e.g., have been laid off or soon will be.

Local Workforce Investments Boards — also sometimes known as Workforce Investment Councils — must then develop plans that align with what their state has produced.

What we see here isn’t just administrative streamlining. The unified plan requirement will tend to break down silos, e.g., between the agency that administers the one-stop employment services centers and the agency that administers adult education.

Beyond this, the bill establishes a clear preference for a career pathway approach to workforce development.

Basically, this approach involves a continuous, interlocking series of programs and services that enable participants to move from wherever they are to successively higher levels of education and employment in a particular industry or occupation that offers significant opportunities in the area where they live.

Services here may include various “needs-related payments” that enable recipients to get — and stay — on their pathways, e.g., transportation subsidies, child care. Also included are diverse hands-on work experiences, paid as well as unpaid.

More generally, the bill eliminates the current sequence of services for adults — an approach that reserves “intensive services” like job counseling for those who haven’t gotten jobs through basic, limited services and training only for those who are still unemployed, despite the intensive services.

The bill requires not only a single, unified plan, but a single set of accountability measures for all core programs serving adults and another set for youth-specific programs.

For adults, this will mean tracking participants according to various success measures. How many secure — and retain — unsubsidized employment, for example, plus their earnings. How many gain additional credentials and/or marketable skills.

Somewhat similar measures for disadvantaged youth — a category that will be broadened to include young adults up to 25 years old.

And, very importantly, results for subpopulations must be reported separately, including each group the bill defines as having a barrier (or barriers) to employment, e.g. homeless people, recipients of major safety net benefits, ex-offenders, single parents, individuals with disabilities.

This is one, though not the only way that the bill seeks to ensure sufficient attention to people for whom a job listing and perhaps some short-shot training won’t be enough for them to gain employment — let alone prospects for advancement.

Well, there’s a lot more in the bill — all 811 pages of it. And a lot of it, including what I’ve tried to summarize is very complex. So I’ll note just one other feature.

WIA authorizes Congress to spend “such sums as are necessary” — in other words, however much (or little) it chooses in any given year. Mostly how little. Funding, in real dollars, was more than 30% lower last year than in 2002.

The Workforce Opportunity and Investment Act specifies authorized, i.e., permissible, funding levels for each major component and for each of the six years it covers. These would generally bring funding back to Fiscal Year 2010 levels by Fiscal Year 2017, according to a National Skills Coalition brief.

But, as NSC also says, it’s very unlikely that programs will be funded at the authorized levels if Congress lets the caps and related cuts continue as currently mandated.

So a bipartisan, bicameral bill that’s a whole lot better than what we’ve got now, but not enough money to appropriately serve the many millions who could benefit — unless Congress does something even more remarkable.

 


DC First Source Act Ripe For Reforms — And May Get Them

March 10, 2011

Over the years, I’ve come to feel that District of Columbia officials are better at making new policies than at making sure that existing policies work.

We have some very enlightened policies on the books. We’ve had neither the oversight nor the ongoing budgetary commitments to produce the outcomes their sponsors and supporters envisioned.

The occasion for this admittedly gross generalization is the District’s First Source Employment Agreement Act.

Under the Act, most employers that receive at least $100,000 in contracts or other financial assistance from the District must make a “good faith effort” to fill 51% of all new jobs and new apprenticeship and trainee positions their funded projects create with District residents.

The Act was passed in 1984. Yet more than 70% of jobs in the District are reportedly held by non-residents.

This is hardly a recent development. In 2008, the DC Fiscal Policy Institute and DC Appleseed reported that “typically” only one of every three jobs in the city was held by a D.C. resident.

The single most important reason is a persistent mismatch between the qualifications a relatively high percentage of local jobs require and the qualifications many lower-income residents have.

The District is, after all, a high-education/high-skills job market. Yet, according to the latest census data, nearly a third of D.C. residents ages 25 and older have no more than a high school diploma or GED. For younger working-age residents, the figure is just shy of 40%.

But you don’t need to know calculus or comma rules to work on a construction crew. Though many of the jobs do involve some technical skills, you could probably learn them through an apprenticeship or informal training arrangement.

Which brings us to the second reason that $34 of every $100 earned in the city goes home to be taxed in Maryland or Virginia. The DC Department of Employment Services hasn’t effectively enforced the First Source Act.

Last August, the District Auditor reported that only four of the sixteen real estate development projects reviewed met the 51% hiring goal. The reason, she said, was that DOES hadn’t monitored the projects.

The department said it didn’t have the staff to do it — a fine example of the gap between good policy ideas and the funding to implement them.

Yet it seems also the case that better enforcement won’t be enough to ensure that our taxpayer dollars provide more and better job opportunities for District residents.

The First Source Act frames requirements in ways that allow covered employers to demonstrate good faith without actually hiring anyone who lives in the District — qualifications notwithstanding.

For example, the 51% jobs goal refers to new hires. So a contractor can bring in a crew from another jurisdiction, even if the members are temporary employees.

More importantly, DOES isn’t an effective “first source,” i.e., the resource a covered employer must use before hiring through other recruitment methods.

Employers complain that the job seekers in the First Source registry don’t have the skills needed for the jobs they’re creating. And they’re probably generally right because DOES doesn’t reach out to candidates who might be qualified. Nor does it help local training providers tailor their programs to employers’ specific needs.

A coalition of nonprofit employment and workforce development experts has produced a policy brief that recommends, among other things, the establishment of a “workforce broker” within the D.C. government.

Basically, this entity would act as an intermediary between employers, residents and organizations that provide training.

It would secure detailed job creation plans and hiring schedules from covered employers well in advance of projected hiring dates. It would then coordinate relevant job training with local providers and community-based organizations.

It would also carefully screen candidates and make referrals to employers, thus increasing the likelihood that they could hire qualified, work-ready residents if they wanted to.

DC Council Chairman Kwame Brown, joined by Councilmembers Michael Brown and Harry Thomas, has introduced a bill that would create such a workforce intermediary.

It would also make some other important changes in the First Source Act — among them, a new set of percentage goals based on work hours, rather than new hires, and heftier fines for noncompliance.

The bill is a good step toward narrowing the gap between the work opportunities our taxpayer dollars create and the benefits that accrue to District residents — and District revenues.

But I think it will need some significant revisions if it’s going to be not just one of those good policy ideas, but a policy that works as intended.

We’ll undoubtedly hear about these next Monday at the Committee on Housing and Workforce Development’s hearing on the bill. It’s scheduled for 10:00 a.m. in Room 120 of the John A. Wilson Building.

CORRECTION: After I posted this, I learned that it might not be altogether accurate to refer to out-of-District workers on a construction project as temporary employees. I’m told that construction contractors generally have a pool of workers they call on as needed. So the workers can be considered ongoing employees, though they don’t necessarily work for the contractor continuously.


What Would DC Lose Under The House Budget Bill?

February 26, 2011

I’ve been trying to get my mind around what the spending cuts passed by the U.S. House of Representatives would mean for the District of Columbia.

Still working on it. There are, after all, a great many cuts and many different formulas for distributing such funds as remain.

Fortunately, the Center on Budget and Policy Priorities has come to the rescue with big parts of the answer — a state-by-state breakout of the major cuts in five broad categories.

It’s an heroic effort, but not exhaustive. Missing, for example, are breakouts of the $747.2 million cut to WIC (the Special Supplemental Nutrition Program for Women, Infants and Children)* and cuts to several other health-related programs.

One of these would totally wipe out long-standing federal funding for family planning and related preventive health care. Another would cut funding for community health centers by $1 billion — about a third of their total federal funding, says Joan McCarter, Senior Policy Editor at Daily Kos.

The CBPP figures reflect the continuing resolution as it was introduced. The version of House passed included numerous amendments. But so far as I know, only one of them affected the cuts CBPP calculated. I’ll post an update if I learn I’m wrong about this.

So, with caveats, here are some of the top-line figures for programs that are especially important to low-income District residents.

Education

The District would lose a total of $8.6 million in grants for K-12 education programs. (I’m assuming here that the funds the House restored for special education would be offset by the larger funding cut approved for school improvements.)

About 44,000 local college students would see their Pell grants reduced or altogether eliminated. The maximum grant they could receive would be $845 less than it is now. Because all grants are based on the maximum, the cut would affect all recipients.

Vocational and adult education programs would be cut by a total of $190,000.

Workforce Development

The job training and related services funded under the Workforce Investment Act would take a much bigger hit than the vocational and adult ed. programs — bigger even than CBPP originally reported.

WIA programs operate on a fiscal year that begins on July 1 — three months before new federal appropriations become effective. So they customarily get advance funding to carry them through. The continuing resolution doesn’t provide any.

So according to CBPP’s recalculation, the District would stand to lose $8.2 million for its WIA Fiscal Year 2011 program year. An estimated 20,900 adults now eligible would lose opportunities for skills assessments, training, job search help and the like, as would about 450 youth.

Affordable Housing

The District’s capital fund grant for public housing would be cut by $9.2 million. This is the grant that helps cover the costs of upgrading and repairing public housing units.

An additional $900,000 would be lost for affordable housing development and rental assistance funded under the HOME Investment Partnerships program.

Community Development

The District would also lose $12.4 million of the funds it receives from the Community Development Block Grant. That’s about 63% of what it received in Fiscal Year 2010.

The block grant can be used for a broad range of activities, including affordable housing development, neighborhood revitalization, improvements to public facilities like neighborhood centers and assistance to businesses for economic development activities that will benefit principally low and moderate-income people.

Mental Health and Substance Abuse

Two other block grants provide the District with funding for mental health services and for substance abuse prevention and treatment. Both would be cut, leaving the District with $471,000 less.

And, once again, the District would be banned from using its own funds for needle exchanges to help control the spread of HIV/AIDS.

Funding Exclusively for the District

CBPP understandably doesn’t cover the impending cut to funding the District receives because it’s the nation’s capital — and a unique state-city hybrid created and still controlled by Congress.

Under the continuing resolution, federal payments to the District would reportedly be cut by more than $80 million. Our Metro system would lose an additional $150 million.

“Another serious blow to the District’s precarious financial situation,” says Mayor Vincent Gray. He warns that the cuts “will probably result in the elimination of key services for residents of the District.”

Unquestionably, especially if he’s talking about the total prospective losses.

On the brighter side, the District almost certainly won’t lose all the funds the pending continuing resolution would take away. The Senate won’t pass the bill as written. President Obama has all but said he’d veto it if the Senate did.

However, the House Republican leadership has made clear that it won’t agree to even a short-term bill to avert a government shutdown unless it includes some cuts in current spending levels.

As so often in these cases, low-income people are likely to get thrown under the bus.

* This is the figure in a just-released budget report by the Coalition on Human Needs. CBPP’s overview for the state-by-state tables and my own calculations put the figure at a rounded-down $752 million.

UPDATE 1: After posting this, I found a state-by-state breakout for the cut to community health centers. According to the national association that represents them, the District would lose $865,826, and 3,755 patients would lose access to care.

UPDATE 2: I originally reported that K-12 education would be cut by $5.4 million. This was an error on my part. The correct figure is in the text above.


How Much Does Single-Mother Poverty Cost Our Nation?

February 24, 2011

My posting on the plight of single-mother families prompted commenter Glenda to ask a really good question: “Do you have any data … on our total public costs to continue to support single mothers living in poverty rather than investing in helping them to get educated and become self-sufficient?”

I replied as best I could at the time. But I’ve decided the issue is worth a deeper dive, especially because the whole matter of government spending on programs for low-income people has become a major focus in many states — and, of course, on Capitol Hill as well.

The short answer to the question is that I don’t know of any study that has compared the relative costs of the benefits that, to a limited extent, sustain poor single mothers with the costs that would be involved in enabling them to fully support themselves and their children.

There are, however, some studies that can help us look at one side of the cost question.

For example, we have some data on what the federal government spends to help support single-mother families. Two sociology professors report that, in 2006, federal expenditures due to “father absence” totaled $98.9 billion. A quick look at the expenditures shows that “father absence” is another way of characterizing single-mother families.

As the authors note, the estimate is actually a fraction of total costs. It doesn’t include costs borne by state and local governments, e.g., what states spend on federal-state “partnership” programs like Temporary Assistance for Needy Families, Medicaid and subsidized child care.

Nor do the estimates include the long-term indirect costs due to the negative effects of growing up fatherless. Many, though probably not all of these are the same as the long-term costs of child poverty.

A team of economists produced a report on these in 2008. Basically, they reviewed the research on the relationships between child poverty and three major cost areas — earnings, propensity to crime and quality of health in adulthood. They put these together with estimated costs of the latter two and projected all the figures out over the total number of poor children in the U.S.

Bottom line was an estimated $500 billion per year cost — nearly 4% of what was then our entire gross domestic product, i.e., the total value of all the goods and services produced in the U.S. This too was explicitly a conservative estimate.

Though the team didn’t assess the cost-effectiveness of specific anti-poverty policies, they did conclude that “investing significant resources in poverty reduction might be more cost-effective over time than [they] previously thought.”

Note the use of the term “investing” here. The same word Glenda used. The thought behind the word seems to me clear and appropriate. Pay some money now because you expect it will yield returns beyond what you spent.

In this case, you put funds into programs that will lift as many children as possible out of poverty — thus, in the long run, increase productivity and reduce public costs.

I flag the word because Senate Minority Leader Mitch McConnell (R-KY) preemptively trashed on the President’s use of it in his recent State of the Union address. “With all due respect to our Democratic friends, any time they want to spend, they call it investment,” he told the anchor on Sunday Fox News.

Seems to me that it’s possible to distinguish smart investments from spending that won’t be offset by benefits to our economy and the well-being of the American people. I should think that policymakers of all stripes would concur on some of the basics.

A review of the spending cuts proposed by the Republican-dominated House Appropriations Committee suggests otherwise. One seems especially relevant here — the large cut in funding for state and local employment training programs. This, along with the other major cuts, passed in the House last Saturday.

Under the just-passed bill, total funding for these programs would be just 53% of what Congress approved for Fiscal Year 2010 — and again as part of the current continuing resolution. It would be just 49% of the President’s proposed budget for Fiscal Year 2011 because he requested an increase.

So we would “save” about $1.4 billion or $1.6 billion, depending on which measure you want to use. (The former is more accurate, though Republicans understandably prefer the latter.)

The National Skills Coalition says we should factor in appropriations customarily made in advance of the new fiscal year. These would bring the total cut to somewhat over $2.97 billion. Some smaller, more narrowly-targeted workforce development programs would be totally defunded — or nearly so.

Consider what McConnell favors instead of these investments — a permanent extension of all the Bush-era tax cuts. This, according to the nonpartisan Congressional Research Service, would cost an estimated $3,402 billion for the first 10 years.

The permanent extension bill just proposed by self-proclaimed deficit hawks Mike Pence (R-IN) and Senator Jim DeMint (R-SC) would presumably cost even more because it would wholly eliminate the estate tax.

You can pay for a lot of job training and education for all those billions — and have plenty left over for other endangered programs that would also help single moms become fully self-sufficient.


Not Enough Revenues To Break The Shortfall Cycle

December 4, 2010

FuseDC blogger Charise puts her finger on an issue I’ve been mulling over. Only difference is that she’s furious and I’m just stymied.

As Charise says, “front-end investments in prevention and intervention measures for youth and families” cost a whole lot less than programs that address our failures to provide the integrated education, training and other services that will get young people into ongoing living-wage employment.

Yet we don’t want to pit investments that will in the long run pay off in higher tax revenues and reduced social spending against programs that provide a safety net for those our system has failed.

Nor, I trust, do we want to opt for investments in youth development if that means neglecting the needs of people who for various reasons can’t become fully self-sufficient. What about seniors who worked at low-wage jobs their whole lives and now depend on meager Social Security retirement benefits? What about individuals with severe physical and/or mental disabilities?

And what about investments in programs that can lift adults out of poverty? These too will reduce safety net spending — and probably needs for spending on young high school dropouts and other “disconnected youth” as well.

So here’s the quandary. We know that robust, well-targeted investments in public education, job creation, workforce development, child care and other poverty reduction programs will help get us out of the current cycle of budget gaps that repeatedly have sent District officials back to the drawing board.

In fact, they’ll generate more revenues to plow back into these investments. But the budget gaps result largely from revenue shortfalls. So we don’t have the funds to turn the spending cycle around — more on prevention and early intervention, less on safety net because less needed.

Look, for example, at what the DC Council faces now. Say it finds the funds to make the adult job training program whole again. That would still leave local funding for the program at only $9.2 million — this when a 2007 Brookings Institution study found that as many as 61,000 low-income working-age residents needed more training and related services.

Say the Council rejects the proposed cut in funding for subsidized child care. That would still leave about 13,000 children on the waiting list for placements.

Parents with very young and/or disabled children would still face a formidable barrier to sustained full-time employment. More child care providers could close their doors, putting yet more people out of work — and likely in need of additional training.

Same story for a host of other investments that pay off in the long run.

The Council can and should find alternatives to Mayor Fenty’s proposed cuts that don’t make a bad situation worse — a new top income tax bracket among them.

But I think the District is in the same situation as state governments across the country. The need to maintain a balanced budget when this deep recession has so depressed revenues severely limits measures that could generate more revenues without further tax increases while also reducing pressures on the safety net.

The federal government doesn’t have to keep its budget balanced. It could shore up hard-pressed state and local programs, including some that have been under-funded for a long time. Instead, we see a range of initiatives to slash federal spending — not just in the long term, but right now.

Not a damn thing we can do about this so far as I can see.


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