The overhaul of the Workforce Investment Act (WIA) in the late 1990s put in place a new framework to provide federal job training programs to workers and to “improve the quality of the workforce, reduce welfare dependency, and enhance productivity and competitiveness.” Reauthorization of WIA is long overdue, as the Act’s provisions technically expired nearly a decade ago. Yet Congress failed to act this year, and, as a result, America has no clear workforce development strategy at precisely the time when our economic future depends on it. Today’s record-high levels of long-term unemployment mean that job training will be critical for America’s future economic success. Many employers complain of a “skills gap” between the skills demanded by available jobs and those held by jobseekers, and individuals seeking training are often unable to obtain the skills they need to enter (or re-enter) the workforce on a path to economic security.
On December 12, Brookings hosted a discussion on the future of federal workforce development policy in the context of long-term joblessness, slow labor market recovery, and a fragile middle class. Moderated by Fellow Elisabeth Jacobs, a panel of experts examined current federal policy, promising proposals for updating existing policy to meet current labor market challenges, and political obstacles preventing progress toward a system that best meets the needs of both workers and employers.
One of the main policies to reduce long-term unemployment is an active labor market policy. The OECD publishes each year data on Government investments in labor market programs like training and wage subsidies.
Gemany and the Scandinavian countries are champions of active labor market policies. This is well known. But, less known is the fact that the US are not. US investment in active labor market programs before the Great recession wasbelow the OECD average, nearly 4 times lower: 0.13% of GDP vs 0.48%.
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