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Monday, February 14, 2011

Congress measures the impact on job training, unemployment insurance programs

a "Project Funded by The American Recover...                                    Image via WikipediaThe House Ways and Means Human Resources subcommittee began hearings on Friday, February 11th to review the nation's unemployment insurance and job training programs.  

This hearing comes on the heels of the Government Accountability Office (GAO) issuing a report that raised concerns on if $18 billion dollars the Federal Government spends on forty-seven types of education and employment training programs are making a dent in finding job opportunities for the nations’ job seekers.
“At a time of record deficits, the American people deserve to know that the government is spending taxpayer dollars wisely.  This report is a stark reminder of the need for Congress to engage in vigorous oversight and to demand accountability and results”, stated Representative David Camp (D-MI) in the press release.
The Subcommittee agreed an obvious need to place unemployed job seekers into employment opportunities to reduce the nations’ current jobless rate, has to be measured against effectiveness of the programs financed by Federal tax dollars.
"The programs under review are designed to help unemployed workers, among others, get the skills they need to prepare for good-paying jobs. With an unemployment rate of 9 percent of higher for the 21st consecutive month, our economy and workers desperately need these programs to function well -- now more than ever before," according to a subcommittee statement."
"Clear indications this system is not working as efficiently as it must to help Americans go to work.  Equally troubling are statements from Federal bureaucrats defending the current system, suggesting 47 programs under nine different agencies somehow make sense and 'overlap' is not a problem."
According to Ways and Means Subcommittee on Human Resources Chairman Geoff Davis (R-KY), witnesses at the hearing were to discuss options for helping long-term unemployed people better prepare for and connect with jobs.

Heather Boushey, senior economist with the Center for American Progress Action Fund, testified that economic evidence proves unemployment benefits and transitional jobs programs have helped the long-term unemployed.

Boushey acknowledged that addressing the deficit is important, but said that a cutback on government spending before a recovery has taken hold could exacerbate unemployment. Additionally, Ms. Boushey advised one of the best ways to assist long-term unemployed job seekers would be to invest in infrastructure to boost demand, work to ensure that those who have jobs can keep them, and help the long-term unemployed beat the odds and find work.  

"We know from decades of research that the displaced and long-term unemployed are more often at the bottom of the hiring queue and often suffer years of lowered earnings," she said. "Congress should consider reinvigorating the TANF Emergency Funds that put people to work in public/private partnerships."

She also addressed that some corporate private businesses are placing their needs to maintain high profits, before hiring, when they have the monetary resources to do so. Boushey cited a way to fix this issue is for the Federal Government to encourage reinvestment into our nations' economy by training, then hiring unemployed job seekers.
"Even though corporate America is flush with cash, investment is at the lowest level in more than five decades. So far in this business cycle, from December 2007 to December 2010, business investment has averaged 10.3 percent of gross domestic product, the lowest average for four decades. This low level of investment is not because of the cost or availability of capital, which continues to be at lows not seen since the 1960s," Boushey noted. 
"Without investment, our resources—the American people—languish in unemployment. A key challenge for policymakers is sorting out how to encourage investment."
Boushey noted that without governmental intervention into job creation, high unemployment will remain a staple for the U.S. economy, for years if not decades.

"Thus, while the recession ended in June 2009, for everyday Americans there hasn’t been a recovery. The private sector has been adding jobs every month for nearly a year and averaged 106,000 jobs per month over the past three months", she stated. 
"This is a faster pace than economic recovery in the 2000s, but at this rate, we won’t reach 5 percent unemployment for decades. To get to 5 percent unemployment by November 2012, we’d need to add more than four times the number of jobs that our economy is adding now—551,000 jobs each month".

One such program in Michigan that assisted unemployed job seekers to prepare for high-demand employment opportunities of the future “No Worker Left Behind”, ran out of funding by the American Reinvestment and Recovery Act of 2009 (ARRA) in July 2010. During the program, unemployed job seekers received supplemental funding to attend secondary education or vocational opportunities for job in the health care, green energy and technology fields.

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