Labor Law Center Blog » Blog Archive » U.S. Dept. of Labor Gives Workers $44.1 Million

U.S. Dept. of Labor Gives Workers $44.1 Million

October 18th, 2007 Posted by Amelia

What would you do if you had an extra $44.1 million leftover in your checking account at the end of the year? If you were the U.S. Department of Labor, you’d spend it on grants for workers.

On October 1, U.S. Secretary of Labor Elaine L. Chao announced the release of more than $44 million to assist states in providing career training, job search and relocation assistance to U.S. workers who lost their jobs for reasons related to trade. In many cases, these job losses resulted from layoffs, cutbacks or plant closures as manufacturers opened factories in China, South America and across the globe.

“This $44 million targeted to 15 states will help workers access skills training, job search assistance and relocation services to build new careers in high growth industry sectors,” said Secretary Chao.

In a sense, Secretary Chao is simply spending funds that have already been set aside for this program. Over the past 4 years, nearly $179 million in “leftover” funds have been released to the states to aid workers adversely affected by changing trade balances. The funds are from remaining fiscal year 2007 resources, which have been maintained in a reserve account set up in fiscal year 2004 by the U.S. Department of Labor under the Trade Adjustment Assistance (TAA) program.

The department is releasing the $44 million remaining to15 states that have the highest TAA-related expenditures. A number of states received grants between $4 million and $5 million dollars, including $4.5 million dollars to California, $4.7 million to Iowa, $4.9 million to Michigan, and $4.8 million to West Virginia.

The largest grant under this program went to North Carolina, in the amount of $5.2 million. The smallest went to South Dakota for $118,669.

Arkansas, Indiana, Kentucky, Massachusetts, New Jersey, Ohio, Oregon, and South Carolina received grants ranging from $1.5 million to $3.8 million.

Grants ranging from $150,000 to $593,127 went to Colorado and Connecticut.

In addition, funds under the program will also go for requested information systems upgrades in Colorado, North Carolina, Ohio and West Virginia. Funds will be distributed immediately along with initial payments for the federal fiscal year 2008, which began October 1.

Each year since 2004, Congress has allocated approximately $220 million for TAA training.

During fiscal year 2004, the Labor Department’s Employment and Training Administration implemented a system for disbursing allocations using a formula that gives states with the greatest needs more money.

A number of states, including Florida, Georgia, Hawaii and Nebraska, did not receive any of the reserve funds.

About 25% of the total funds are released during the year for specific plant closures to help workers. The remaining 75% is released annual. Funds are allocated in proportion to the TAA grants previously awarded.

The funds go to qualifying states that experienced large, unexpected layoffs during the year. States must spend at least 50% of the allotted funds before requesting more from the reserve account.

”Our commitment to the harder hit states will ensure that their communities can work with employers and educators to return their dislocated workers quickly to the workforce,” said Assistant Secretary of Labor for Employment and Training Emily Stover DeRocco. “As our nation’s workers strive to succeed in the competitive global economy, it is important that those facing trade-related job loss have access to expanded career opportunities.”

TAA or Trade Adjustment Assistance includes career counseling and job training. In most cases, displaced workers are not able to find another well-paying job in a similar field. TAA partially offsets the loss of wages and tuition costs while workers learn new skills to compete in the marketplace. If the workers accept a lower-paying job, TAA provides supplementary payments to partially offset lost wages for up to 24 months.