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When Job Training Benefits Run Dry

June 6, 2008

After 34 years working at a North Carolina textile plant, Cora Turner was called into a meeting last April and given the all-too-familiar news: Your job is going overseas, and it’s not coming back.

Turner, now 56, had devoted her working years to Burlington Industries, which became part of International Textile Groups in 2004. Like hundreds of other Caswell County residents who were laid off from the company, Turner was faced with the prospect of starting over from scratch. She had no high school diploma, and she lacked the training to find decent work in the modern economy.

A federal program known as the Trade Adjustment Assistance program was specifically designed to help workers like Turner to return to college and acquire the skills they need for today’s workforce. But despite significant investment in program, which cost $220 million to train nearly 90,000 workers in 2006 alone, it still falls short in its mission, according to officials in higher education and state government.

At Piedmont Community College, where Turner is enrolled, college administrators have found that the federal assistance program doesn’t always provide sufficient coverage to students, particularly those who come to campus unprepared for college-level work. The program covers students for 130 weeks of training, including some allowances for remedial work, but that’s still often not enough time for students to complete an associate degree, according to Angela Webb, director of human resources development at Piedmont.

“They need remedial [classes], but we’re finding people coming from manufacturing that don’t even have the high school diploma,” she said. “Many of them are having to spend a year or more before they can even get their GED to go into skills training. They don’t even know how to turn on a computer, most of them don’t.”

Of those who enrolled in the Trade Adjustment Assistance program between 2006 and 2007, 18 percent had not completed high school, according to the U.S. Department of Labor. Just 8 percent of the participants were college graduates.

Piedmont Community College and nearby Danville Community College, which is just across the Virginia border, have been flooded with dislocated workers in the wake of trade-associated layoffs, giving officials at both colleges a first-hand look at where federal assistance programs often fall short. Cognizant of the need their students have for more assistance, the colleges recently secured a joint $1.85 million grant aimed at supplementing federal funds for dislocated workers pursuing school full-time.

The grant was provided by the Danville Regional Foundation, which uses funds from the sale of an area medical center to improve the lives of residents.

Turner, who says the clock will run out on her assistance before she can complete her associate degree, is among the potential beneficiaries of the foundation funds. Barring that help, however, she says she’ll settle for a certificate in medical technology. Such a certificate would position Turner to take a job that pays between $8 and $10 an hour — as little as half of what she made working in textiles.

It’s not uncommon for dislocated workers to go through a long process of additional training, only to end up making less than they did before they were laid off. On average, those who completed training through the federal Trade Adjustment Assistance program in 2006 went on to find jobs that only paid 77 percent of what they’d made before, according to the Office of Management and Budget.
Neal McCluskey, associate director of the Cato Institute’s Center for Educational Freedom, said federally-funded job re-training programs have a “history of failure” that proves them ineffective. Even those who complete the programs aren’t usually trained for professions in true growth areas, he said.

“Typically they don’t’ work,” McCluskey said. “The federal government has put a fair amount of money into training programs, and usually it’s very difficult to get people retrained and put into jobs that have a good future.”

The Trade Adjustment Assistance program, established in 1962, is the federal government’s premier program for helping dislocated workers pursue further education and job training. The program not only covers tuition and books, but also offers income and health care assistance to workers who can establish their jobs were clearly lost due to trade.

According to the U.S. Department of Labor, 72 percent of those who completed the program in 2006 found jobs within three months. Of those, 90 percent retained those positions for at least nine months.

But the reliability of the Department of Labor’s numbers has been called into question by the Government Accountability Office.
In 2007 testimony before the House Committee on Ways and Means, GAO officials said the department’s data on the program were “incomplete and may be inaccurate.” Specifically, the GAO noted that only half the states participating in the program tracked all participants in the program.

The GAO found other areas of concern within the federal program, including a health care plan that requires participants to pay 35 percent of their health care premiums. In four states studied by the GAO, officials found that workers’ out-of-pocket health care expenses would cost them nearly one quarter of their unemployment benefits. These high costs deterred participants in the program from tapping into the benefit, according to the GAO.

Congress passed a continuing resolution in 2007 that extended funding for the Trade Adjustment Act through September of this year.

As might be expected, the nation’s premier program for dislocated workers also has the most stringent requirements for qualification. While the Trade Adjustment Assistance program covers those who’ve lost manufacturing jobs due to trade, it doesn’t cover similarly affected workers in other sectors of the economy like services.

For those workers who don’t qualify for the trade adjustment program, another federal program called the Work Investment Act is typically the next best thing. But the investment act has much less generous benefits, and it places too little emphasis on preparing workers for 21st Century jobs, according to Andy Levin, director of the Michigan Department of Labor and Economic Growth.
“In our view in Michigan, (Work Investment Act polices are) wrong,” he said, “They’re all about reemployment and none about training.”

In Michigan, which has been rocked by manufacturing layoffs, more than half of the money that comes into the state under the Work Investment Act is used to help laid off workers quickly find jobs — instead of providing longer-term educational training for employment in growth industries, Levin said. Michigan officials say they want to change the paradigm, placing the lion’s share of funding in educational programs.

“We’re going to grab hold of workforce policy and we’re going to say in Michigan the priority is training that can change people’s lives,” Levin said.

Launched by Gov. Jennifer Granholm in 2007, Michigan’s No Worker Left Behind program is designed to consolidate a mix of available state and federal funds to provide two years worth of free tuition for workers who are pursuing degrees in high-demand fields or emerging industries.

Roberta Peterson, interim vice president for academic affairs at Lansing Community College, calls No Worker Left Behind a breath of fresh air.

“I haven’t always been a huge fan of this governor, but I think this is one of the things that is very innovative,” Peterson said. “This is really helping people be able to use the resources.”

 

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