Worker Adjustment Assistance Under the Trade Act of 1974:

Problems in Assisting Auto Workers

HRD-77-152: Published: Jan 11, 1978. Publicly Released: Jan 11, 1978.

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Congress has recognized that increased imports resulting from expanded international trade could adversely affect certain workers and firms within the United States and has directed that segments of the economy affected by increased import competition receive various forms of monetary and nonmonetary adjustment assistance. The Worker Adjustment Assistance Program is administered by the Department of Labor through State employment agencies and provides eligible unemployed workers with weekly allowances; training, counseling, and job referral; and job search and relocation allowances. As of June 30, 1976, 149,800 workers from the auto industry were certified as eligible to apply for adjustment assistance.

Few automotive industry workers took advantage of the training, job search, and relocation benefits through the adjustment assistance program because most layoffs in the industry were considered temporary, and most workers were either back to work or willing to wait for recall rather than accept another job. Most of the workers had returned to work long before their adjustment assistance payments were received. When the payments were received, a large part of the money was used to repay the company/union supplemental unemployment benefit fund. Program benefits were not always distributed equitably because of problems in identifying specific workers separated from jobs because of import competition. Some auto workers received program benefits for layoff periods unrelated to import competition.

Matter for Congressional Consideration

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Matter: The Secretary of Labor, before issuing certifications, should determine the extent to which affected workers can be identified from employer records, and, when issuing certifications, should provide guidelines for determining which workers are eligible. Congress should amend the Trade Act of 1974 so that supplemental unemployment and similar benefits can be treated in the same manner as other earned income in computing weekly benefit entitlements.

 

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