Pursuant to a congressional request, GAO discussed the Department of Labor's progress in making its 61 mission-critical systems year 2000 compliant, focusing on: (1) the systems operated by states to administer unemployment benefits payments for Labor's Unemployment Insurance Service (UIS); and (2) an assessment of the risks faced by the Bureau of Labor Statistics (BLS).

GAO noted that: (1) Labor has taken action to prepare its 61 mission-critical systems for the change of century; (2) however, with a little more than 7 months left, Labor remains at risk of systems disruptions in two of the areas GAO highlighted last fall: making benefits payments to laid-off workers, and producing labor and economic statistics; (3) the risk in making benefits payment systems compliant emanates from Labor's reliance on largely unverified progress reports from states and on states' capabilities to get the job done; (4) several State Employment Agencies report that they are not yet compliant; (5) further, the department acknowledges that 4 of the 23 mission-critical systems used by BLS contain a non-year 2000-compliant vendor product; and (6) given these risks, it is important that appropriate contingency plans be developed to ensure business continuity in the event of system failures.