Economic Adjustment Assistance:

Actions Needed to Better Address Workers' Needs and Assess Program Effectiveness

GAO-20-521: Published: Jul 29, 2020. Publicly Released: Jul 29, 2020.

Multimedia:

  • PODCAST: Programs Designed to Help Workers Facing Economic Disruptions

    U.S. workers, companies, and communities have often needed to alter how they work or operate because of external forces, such as trade agreements and defense or energy policy changes. Perhaps no single shift has impacted workers and companies like the disruptions caused by the coronavirus pandemic. We talk to Cindy Brown Barnes about a recent review of federal programs meant to help workers adjust to these disruptions.

    View the transcript

Additional Materials:

Contact:

Cindy S. Brown Barnes
(202) 512-7215
brownbarnesc@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

When a plant or company closes down or moves, there are some federal programs to help workers adjust to losing their jobs. For example, the Appalachian Regional Commission (ARC) and the Department of Labor both give state and local organizations grants to provide job training and counseling services.

We reviewed these grants and found that:

Labor did not process some grant applications in a timely manner

ARC and Labor do not share information about their grant programs with each other—so they may miss opportunities to best serve workers

We recommended that the two agencies address these (and other) issues.

Participants, including former coal miners, training to become electrical utility workers

people training on telephone phones

Multimedia:

  • PODCAST: Programs Designed to Help Workers Facing Economic Disruptions

    U.S. workers, companies, and communities have often needed to alter how they work or operate because of external forces, such as trade agreements and defense or energy policy changes. Perhaps no single shift has impacted workers and companies like the disruptions caused by the coronavirus pandemic. We talk to Cindy Brown Barnes about a recent review of federal programs meant to help workers adjust to these disruptions.

    View the transcript

Additional Materials:

Contact:

Cindy S. Brown Barnes
(202) 512-7215
brownbarnesc@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

Workers who are eligible for federal economic adjustment assistance (EAA) programs may face challenges using them. There are four EAA programs and one tax credit that focus on assistance to individual workers displaced by policy and economic changes. These include programs administered by the Appalachian Regional Commission (ARC) and Department of Labor (DOL), which deliver services such as job training and counseling through state and local grantees. Selected grantees in all three states GAO visited described common challenges faced by workers from enrollment in EAA programs through re-entry into the job market.

Grantees Described Common Challenges Workers Face in Accessing and Using Economic Adjustment Assistance (EAA) Program Services

Grantees Described Common Challenges Workers Face in Accessing and Using Economic Adjustment Assistance (EAA) Program Services

Interviews with selected grantees and GAO's data analysis revealed two key challenges with administering EAA programs and serving workers:

  • Delays in grant decisions. From fiscal years 2015 through 2018, DOL took longer than legally required to process between 9 percent (3 out of 35) and 20 percent (3 out of 15) of National Dislocated Worker Grant applications. Grantees may serve fewer workers and may interrupt services to workers while awaiting decisions. DOL does not collect information on reasons for these delays and is missing opportunities to help ensure that dislocated workers receive timely assistance.
  • Lack of information sharing. ARC and DOL do not share information about their EAA grant programs with grantees or each other, including information about grant projects that serve similar populations in similar geographic areas. As a result, ARC and DOL may fail to maximize program impact and reach across the 13-state Appalachian region. Regional officials said that coordination would enable them to better identify specific services needed by dislocated workers and which program might best be equipped to provide them.

DOL has established performance measures to track outcomes for its EAA programs, but has experienced challenges with assessing the impact of job training offered under these programs. GAO reviewed two relevant studies on the impact of DOL's EAA programs containing some evidence that intensive services, such as one-on-one consultations and case management, were effective in improving earnings outcomes for dislocated workers. However, the studies were unable to effectively assess the impact of job training offered to dislocated workers under the programs due to methodological challenges. By collecting more quality evidence, DOL could be better able to determine if its EAA programs are helping workers achieve their employment goals.

Why GAO Did This Study

Federal EAA programs help workers adjust to various economic disruptions, such as policy changes on trade, defense, or energy, and shifts in immigration, globalization, or automation that cause a prolonged cyclical downturn and can dislocate workers. GAO was asked to review these programs.

This report examines (1) what challenges eligible workers face in using EAA programs, (2) what challenges grantees face in implementing EAA programs and serving workers, and (3) what is known about the outcomes and impacts of selected EAA programs. GAO analyzed DOL grant processing data from fiscal years 2015 through 2018, the most recent data available at the time of GAO's analysis; reviewed outcome data from program year 2018 and program impact evaluations; interviewed ARC, DOL, and Department of the Treasury officials, as well as state and local officials in three states that experienced different economic disruptions and use different EAA programs; and reviewed relevant federal laws, regulations, and guidance.

What GAO Recommends

GAO is making seven recommendations, including that DOL address grant processing delays, DOL and ARC share information, and DOL prioritize improving the quality of evidence on the impact of job training for dislocated workers. DOL and ARC agreed with GAO's recommendations.

For more information, contact Cindy S. Brown Barnes at (202) 512-7215 or brownbarnesc@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should ensure that DOL has a procedure to help the agency analyze reasons for delays in processing National Dislocated Worker Grant applications and grant modifications. (Recommendation 1)

    Agency Affected: Department of Labor

  2. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should identify and implement additional mechanisms to allow EAA grantees to share information about innovative and best practices with each other, such as DOL hosting an in-person or virtual national convening for grantees. (Recommendation 2)

    Agency Affected: Department of Labor

  3. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should work with the Federal Co-Chair of the ARC to identify and implement mechanisms that allow for information sharing between the two agencies regarding their EAA programs, including sharing grant decisions. (Recommendation 3)

    Agency Affected: Department of Labor

  4. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Federal Co-Chair of the ARC should work with the Secretary of Labor to identify and implement mechanisms that allow for information sharing between the two agencies regarding their EAA programs, including sharing grant decisions. (Recommendation 4)

    Agency Affected: Appalachian Regional Commission

  5. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Federal Co-Chair of the ARC should develop a plan for addressing issues related to performance data for POWER Initiative grants. (Recommendation 5)

    Agency Affected: Appalachian Regional Commission

  6. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should, as part of the Department's evidence building processes, prioritize improving the quality of evidence on the impact of job training for dislocated workers. (Recommendation 6)

    Agency Affected: Department of Labor

  7. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Labor should identify the expected time frame for providing the first report to Congress that is responsive to the WIOA requirement for an annual report that includes research and evaluation findings. In addition, the agency should communicate this time frame to relevant congressional committees. (Recommendation 7)

    Agency Affected: Department of Labor

 

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