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Workforce Funding in the Next Coronavirus Response Legislation

By: Robert Knight, Director of Government Relations and Workforce Policy

The public workforce system plays two vital roles in responding to disasters.

  1. The workforce system is a primary source of relief for those who lose their jobs through its Unemployment Insurance (UI) System.
  2. The workforce system is at the center of recovery efforts through job training, job placement, and employer services that get workers back into productive employment.

While most elected officials, as well as most economists, agree that additional stimulus funding is needed to keep the American economy from declining even further, the Administration and Congress have been unable to reach a compromise that keeps relief and recovery on track. The Democratic House approved $3 trillion across an array of programs in the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act. At the same time, Senate Majority Leader Mitch McConnell (R-Ky.) recently unveiled the Health, Economic Assistance, Liability Protection and Schools Act (HEALS) Act, a proposal of about $1 trillion.

While deadlocks of this nature often end with the two sides agreeing to split the difference, in this instance, a compromise has proven elusive. Enhanced UI benefits are a significant sticking point. Democrats have dug in on retaining a weekly benefit of $600, while Republicans favor reducing it to $400 or for some even less.

President Trump responded to the congressional impasse by issuing Executive Orders offering new UI benefits, preventing renters from eviction, extending the student loan moratorium, and postponing the payment of payroll taxes. Some observers question the legality of these moves and others their effectiveness. However, it could be the push that Congress needs to find a legislative solution.

How does the Workforce Innovation and Opportunity Act (WIOA), specifically its career centers and youth programs, fit into the current debate? We have never seen a dislocation of this magnitude, made more complicated by the physical constraints required to meet the need for social distancing. Simply put, the workforce system needs to focus on effectively serving job seekers in recovery and will need more resources to respond to the current situation.

It is no secret that inflation-adjusted support for workforce development has been in decline for decades. A coalition of organizations that support education, training, and workforce development services has called for an infusion of $15 billion into a variety of programs, including WIOA initiatives.

While we should continue to advocate for this larger goal, we also need to recognize good news when we see it. Senator McConnell’s coronavirus bill, noted above, includes $950 million for the WIOA system as follows:

  • $500 million to the States for dislocated worker activities
    The new funds are to focus on training for returning workers and incumbent workers using a variety of services, including on-the-job training (OJT), customized training, and the development of transitional jobs. The proposed legislation also encourages the one-stop system to identify online training providers and to facilitate remote access to workforce development services (areas where the workforce system is already making significant progress).
  • $150 million for WIOA Youth activities
    The bill would loosen the out-of-school participation requirement to some extent for the additional funds, a move likely to have support in many places.
  • $150 million for WIOA Adult programs
  • $150 million additional infusions into the Dislocated Worker National Reserve Grant program

His proposal would also provide $350 million from the UI Trust Fund to States for the Wagner-Peyser (Employment Service) Program.

So what will this back and forth mean for the workforce? In normal circumstances, we would speculate that a Senate-House deal on the workforce would land somewhere between the $2 billion the House approved in the HEROES Act and the almost $1 billion in the Senate proposal. But as we all know, these are not normal times.