Trade Adjustment Assistance: Most Workers in Five Layoffs	 
Received Services, but Better Outreach Needed on New Benefits	 
(31-JAN-06, GAO-06-43). 					 
                                                                 
Little is known nationally about the extent to which workers laid
off as a result of international trade use the variety of	 
federally funded reemployment services available to them. GAO was
asked to study the experiences of workers affected by a small	 
number of trade-related layoffs. GAO examined (1) the extent to  
which workers accessed federally funded reemployment services and
the mix of services received, (2) the employment outcomes these  
workers achieved, and (3) the extent to which workers used the	 
new health insurance and wage insurance benefits under the Trade 
Adjustment Assistance (TAA) program, and the factors affecting	 
their participation.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-43						        
    ACCNO:   A46079						        
  TITLE:     Trade Adjustment Assistance: Most Workers in Five Layoffs
Received Services, but Better Outreach Needed on New Benefits	 
     DATE:   01/31/2006 
  SUBJECT:   Employment assistance programs			 
	     Health insurance					 
	     Income maintenance programs			 
	     International trade				 
	     Occupational surveys				 
	     Program evaluation 				 
	     Reductions in force				 
	     Reemployment					 
	     Training utilization				 
	     Trade Adjustment Assistance Program		 

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GAO-06-43

     

     * TRADE ADJUSTMENT ASSISTANCE
     * Most Workers in Five Layoffs Received Services, but Better O
          * Contents
          *  
               * Results in Brief
               * Background
                    * Trade Adjustment Assistance Program
                    * WIA Dislocated Worker Program
                    * Employment Service
               * Most Workers at Five Sites Received Some Reemployment Assist
                    * Most Workers at Each Site Visited a One-Stop Center and
                      Rece
                    * Workers Most Often Visited One-Stop Centers for Job
                      Search A
                    * About One-Third or Less of Workers Generally Received
                      Traini
                    * Age, Gender among Factors Affecting Training Enrollment
                         * Workers' Characteristics
                         * Timing and Availability of Training Programs
                         * State Training Policies
               * Most Workers at Four of the Five Sites Found a Job or Retire
                    * Most Workers at Four of Five Sites Were Reemployed or
                      Retire
                    * The Majority of Workers in Most Sites Earned Less in
                      Their N
                    * Outcomes Alone Cannot Measure Program Impact
               * A Small Proportion of Workers in the Five Sites Received Hea
                    * Few Workers Received HCTC at Any Site, and Less Than
                      Half Kn
                    * Few Workers Received Wage Insurance Benefits at Any
                      Site
               * Conclusions
               * Recommendations for Executive Action
               * Agency Comments
          * Appendix I: Objectives, Scope, and Methodology
               * Case Study Site Selection
                    * Site Visits and Focus Groups
                    * Review of State Administrative Data
                    * Telephone Survey
                    * Regression Analysis of Survey Data
          * Appendix II: Detailed Breakdown of Workers' Training Provide
          * Appendix III: Detailed Breakdown of Participation in HCTC
          * Appendix IV: Regression Analysis of Survey Data
          * Appendix V: General Mills Plant Closure (Hazelwood, Mo.)
          * Appendix VI: Lear Plant Closure (Lewistown, Pa.)
          * Appendix VII: Weyerhaeuser Plant Closure (Longview, Wash.)
          * Appendix VIII: Toro Plant Closure (Oxford, Miss.)
          * Appendix IX: Sanmina-SCI Plant Closure (Wilmington, Mass.)
          * Appendix X: Comments from the Department of Labor
          * Appendix XI: GAO Contact and Staff Acknowledgments
          * Related GAO Products
               * Order by Mail or Phone

Report to Congressional Requesters

United States Government Accountability Office

GAO

January 2006

TRADE ADJUSTMENT ASSISTANCE

Most Workers in Five Layoffs Received Services, but Better Outreach Needed
on New Benefits

Trade Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance Trade Adjustment
Assistance Trade Adjustment Assistance Trade Adjustment Assistance Trade
Adjustment Assistance Trade Adjustment Assistance

GAO-06-43

Contents

Letter 1

Results in Brief 5
Background 7
Most Workers at Five Sites Received Some Reemployment Assistance, but
Generally Less Than a Third Entered Training 12
Most Workers at Four of the Five Sites Found a Job or Retired after Being
Laid Off, and Employment Outcomes Varied by Services Received 29
A Small Proportion of Workers in the Five Sites Received Health Insurance
or Wage Insurance Benefits, but Many Workers Were Unaware of These
Benefits 39
Conclusions 48
Recommendations for Executive Action 50
Agency Comments 50
Appendix I Objectives, Scope, and Methodology 52
Appendix II Detailed Breakdown of Workers' Training Providers and Costs by
Site 56
Appendix III Detailed Breakdown of Participation in HCTC 57
Appendix IV Regression Analysis of Survey Data 59
Appendix V General Mills Plant Closure (Hazelwood, Mo.) 63
Appendix VI Lear Plant Closure (Lewistown, Pa.) 66
Appendix VII Weyerhaeuser Plant Closure (Longview, Wash.) 69
Appendix VIII Toro Plant Closure (Oxford, Miss.) 72
Appendix IX Sanmina-SCI Plant Closure (Wilmington, Mass.) 75
Appendix X Comments from the Department of Labor 78
Appendix XI GAO Contact and Staff Acknowledgments 86
Related GAO Products 87

Tables

Table 1: TAA Program Fund Allocations for Case Study States, Fiscal Year
2004 10
Table 2: Workers in TAA- and WIA-Funded Training by Program Type 25
Table 3: Maximum Allowable TAA Training Costs per Worker 28
Table 4: Average Pre-layoff Hourly Wage and Wage Replacement Rates 35
Table 5: Monthly Costs for HCTC-Eligible Health Insurance Plans Available
to Dislocated Workers at Each Site 45
Table 6: Number of Focus Groups and Participants by Site 53
Table 7: Survey Response Rates by Site 54
Table 8: Workers in TAA- and WIA-Funded Training by Provider Type 56
Table 9: Workers in TAA- and WIA-Funded Training by Expected Program Cost
56
Table 10: Workers' participation in HCTC 57
Table 11: Key Reasons Workers Gave for Not Participating in HCTC 58
Table 12: Numbers and Percentages of Workers Who Visited a One-Stop
Center, by Sex and Site, and Odds and Odds Ratios Derived from Them 60
Table 13: Odds Ratios Describing the Effects of Various Factors on the
Likelihoods of Visiting a One-Stop Center, Receiving Training, and
Receiving HCTC 61
Table 14: Profile of St. Louis County, Mo. 63
Table 15: Characteristics of Workers at General Mills' Hazelwood Plant 64
Table 16: Profile of Mifflin County, Pa. 66
Table 17: Characteristics of Workers at Lear's Lewistown Plant 67
Table 18: Profile of Cowlitz County, Wash. 69
Table 19: Characteristics of Workers at Weyerhaeuser's Longview Plant 70
Table 20: Profile of Lafayette County, Miss. 72
Table 21: Characteristics of TAA-Certified Workers at Toro's Oxford Plant
73
Table 22: Profile of Middlesex County, Mass. 75
Table 23: Characteristics of Workers at Sanmina-SCI's Wilmington Plant 76

Figures

Figure 1: Case Study Sites 4
Figure 2: Most Dislocated Workers Visited a One-Stop Center 14
Figure 3: Most Workers Received One-on-One Assistance at One-Stop Centers
15
Figure 4: Service Tracks Available at the Lewistown, Pa., One-Stop Center
16
Figure 5: Percentage of Workers Who Went to a One-Stop Center within 2
Months of Being Laid Off 20
Figure 6: One-Third or Fewer of Workers at Most Sites Enrolled in Training
21
Figure 7: Workers in TAA- or WIA-Funded Training by Expected Length of
Training Program 22
Figure 8: Number of Months Workers Received Income Support Benefits (UI
and in Some Cases Extended Income Support) 23
Figure 9: Most Workers at Four of Five Sites Had Found Jobs or Retired at
the Time of the Survey 31
Figure 10: Number of Months Workers Took to Find Their Current Jobs 33
Figure 11: Workers Replaced About 80 Percent or More of Wages on Average
34
Figure 12: Most Workers Received Benefits in New Jobs 36
Figure 13: More Than Half of Reemployed Workers Returned to Manufacturing
37
Figure 14: Across Sites, HCTC Participation Was Relatively Low 40
Figure 15: Percentage of Workers Who Visited a One-Stop Center Who Were
Aware of HCTC 41
Figure 16: Reasons for Not Participating in HCTC, among Workers Who Were
Aware of HCTC but Chose Not to Participate 43
Figure 17: Few Workers Participated in ATAA 47
Figure 18: Percentage of Older Workers Who Visited a One-Stop Center and
Were Aware of ATAA 48
Figure 19: Time Line of General Mills Plant Closure, Hazelwood, Mo. 65
Figure 20: Time Line of Lear Plant Closure, Lewistown, Pa. 68
Figure 21: Time Line of Weyerhaeuser Plant Closure, Longview, Wash. 71
Figure 22: Time Line of Toro Plant Closure, Oxford, Miss. 74
Figure 23: Time Line of Sanmina-SCI Plant Closure, Wilmington, Mass. 77

Abbreviations

ATAA Alternative Trade Adjustment Assistance

COBRA Consolidated Omnibus Budget Reconciliation Act of 1985

ES Employment Service

GED General Equivalency Diploma

HCTC Health Coverage Tax Credit

IRS Internal Revenue Service

TAA Trade Adjustment Assistance

UI Unemployment Insurance

WARN Worker Adjustment and Retraining Notification Act

WIA Workforce Investment Act

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United States Government Accountability Office

Washington, DC 20548

January 31, 2006

The Honorable Charles Grassley, Chairman The Honorable Max Baucus, Ranking
Minority Member Committee on Finance United States Senate

The Honorable Michael Enzi, Chairman The Honorable Edward Kennedy, Ranking
Minority Member Committee on Health, Education, Labor, and Pensions United
States Senate

Manufacturing workers in the United States face an uncertain future, as
manufacturing employment continues to decline. The rate of manufacturing
job loss has slowed since early 2003, but manufacturing employment has
continued to fall despite overall employment growth. Between January 2003
and June 2005, manufacturing employment in the United States fell by 3.9
percent while overall employment increased by 2.6 percent. Finding a new
job may be especially challenging for manufacturing workers who lose their
jobs as a result of international trade, in part because they may be
unable to adapt to the changing U.S. labor market. These workers tend to
be older and to have fewer transferable skills than other laid-off
workers, according to one study, making reemployment assistance especially
important for them.1

The Trade Adjustment Assistance (TAA) program, established in 1962, is the
federal government's primary effort targeted at manufacturing workers who
lose their jobs as a result of international trade. The program, funded at
$1.1 billion in fiscal year 2005, is focused on manufacturing workers laid
off as a result of increased import competition or a shift of production
abroad. TAA provides up to 130 weeks of training and up to 104 weeks of
income support benefits to supplement the regular 26 weeks of Unemployment
Insurance (UI) benefits available to workers in most states. The TAA
Reform Act of 2002 added two new benefits to the program-health insurance
assistance and wage insurance for older workers. In addition, the federal
government funds reemployment services such as job search assistance for
dislocated workers and job seekers more generally, including
trade-affected workers, through the Workforce Investment Act (WIA)
Dislocated Worker program and the Employment Service (ES) program. The
U.S. Department of Labor (Labor) oversees the TAA, WIA Dislocated Worker,
and ES programs, which are generally implemented at the state and local
level through a network of one-stop centers that provide access to a
variety of employment and training services.

1 See Lori Kletzer, Job Loss from Imports: Measuring the Costs
(Washington, D.C.: Institute for International Economics, 2001).

Despite the availability of a broad array of federally-funded services,
little is known nationally about the extent to which workers affected by
international trade use these services. Labor tracks the number of
individuals who receive services through the TAA, WIA Dislocated Worker,
and ES programs, but these data do not tell us the proportion of workers
affected by a given trade-related layoff who seek services or the full
range of services they receive. Workers affected by a trade-related layoff
could, for example, look for a job on their own; they could visit a
one-stop center and receive reemployment services such as workshops and
one-on-one assistance; or they could receive training and extended income
support. To better understand how trade-affected workers utilize federally
funded assistance, and what employment outcomes they achieve, you asked us
to examine the experiences of workers affected by a small number of
trade-related layoffs. Specifically, in this report we examine (1) the
extent to which workers accessed federally funded reemployment services
and the mix of services received, (2) the employment outcomes these
workers achieved, and (3) the extent to which workers used the new health
insurance and wage insurance benefits under the TAA program, and the
factors affecting their participation.

To address these questions, we selected plant closures at five locations:
General Mills, Inc. (baked goods, Missouri); Lear Corporation (automotive
carpets, Pennsylvania); Sanmina-SCI Corporation (printed circuit boards,
Massachusetts); The Toro Company (lawnmower and snow-thrower engines,
Mississippi); and Weyerhaeuser Company (fine paper and pulp, Washington).2
These plant closures all occurred since January 2003, and Labor determined
that all were related to international trade. In the aggregate, about
1,500 workers were affected by these closures and were potentially
eligible for the TAA program, or almost half of 1 percent of the estimated
number of workers covered by the 3,618 TAA petitions certified nationally
during fiscal years 2003 and 2004.3 The General Mills plant (near St.
Louis) and the Sanmina-SCI plant (near Boston) were located in large
metropolitan areas, the Lear and Toro plants were located in rural
counties, and the Weyerhaeuser plant was located in a medium-sized town.
We selected these sites because the plants manufactured a variety of
products, were located in different regions of the country, experienced a
layoff event that affected between 100 and 500 workers, and occurred after
the TAA Reform Act of 2002 was enacted (see fig. 1). The Toro layoff in
Mississippi affected over 100 workers total, but just 40 of them were
determined by Labor to have lost their jobs as a result of international
trade and were potentially eligible for TAA services.4 To learn about
strategies to help affected workers, we visited each layoff site and
interviewed state and local officials, company and union officials, and
training providers. To learn more about workers' experiences with
employment and training services and their reemployment outcomes, we
conducted a telephone survey of workers affected by each layoff. Survey
response rates for each layoff ranged from 66 percent to 86 percent. We
used the responses to make estimates about the entire population of each
site, after conducting an analysis of the difference between the survey
respondents and non-respondents. All percentage estimates from our survey
have margins of error of plus or minus 7 percent or less unless otherwise
noted. All wage related estimates from our survey have relative margins of
error of plus or minus 10 percent or less unless otherwise noted. (For
detailed survey results by site, see GAO-06-44SP .) Using data from our
worker survey, we performed multivariate regression analyses to estimate
the effects of factors such as age, gender, and education level on the
likelihood of receiving training and other services. We augmented the
survey with several focus group discussions of two to seven workers at
each site. We also reviewed state administrative data on workers'
demographics and the services they received, as well as state wage records
on employment outcomes, when available. We assessed all data for
reliability and found them to be sufficiently reliable for the purposes of
our reporting objectives. We performed our work from November 2004 through
December 2005 in accordance with generally accepted government auditing
standards. (See app. I for more details on our objectives, scope, and
methodology.)

2 For the remainder of this report, we refer to these companies as General
Mills, Lear, Sanmina-SCI, Toro, and Weyerhaeuser.

3 All workers covered by a certified TAA petition are potentially eligible
for TAA benefits and services. However, certified workers must apply
individually for specific benefits and services.

4 In our analysis and reporting, we focused on the workers in the Toro
site who were covered by the TAA petition, but when relevant we included
data on the other workers for comparison.

Figure 1: Case Study Sites

                                Results in Brief

At all five sites that we studied, the majority of affected workers
received some reemployment assistance through a one-stop center, but at
most sites about a third or less received training and long-term income
support. Between 72 and 100 percent of the workers in each site went to a
one-stop center, and they most commonly received one-on-one assistance
such as job search assistance, according to our survey estimates. Women
and workers with lower pre-layoff wages were significantly more likely to
visit a one-stop center than men and workers with higher pre-layoff wages.
At four of the five sites that we studied, about a quarter or less of the
workers did not go to a one-stop center. These workers most commonly
reported that they needed to find a job right away and did not think they
had time to visit a one-stop center, or did not need help finding a job.
While most workers at each site visited a one-stop center, a minority at
each site enrolled in training. The proportion who enrolled in training
ranged from 9 to 39 percent at the five sites, with no more than a third
in training at four of the sites. While about half the workers received
income support benefits for over 6 months at three of five sites, about
one-third or less of the workers in all five sites received long-term
benefits-for 1 year or longer-which are generally available only to
trade-affected workers in training who have exhausted their Unemployment
Insurance benefits. Older workers were less likely to enter training,
according to analysis of our survey data. For example, over half of the
Weyerhaeuser workers in Washington were age 55 or older, and only 5
percent of these older workers entered training while almost 60 percent
retired.

Most of the affected workers had either found a job or retired at the time
of our survey. At three of the sites, 60 percent or more of the workers
had found jobs. In another site, Weyerhaeuser in Washington, 39 percent
had found jobs, and an additional 32 percent had opted for retirement. In
the fifth site, Sanmina-SCI in Massachusetts, only 37 percent of the
workers had found new jobs, but this layoff occurred more recently and had
the highest proportion of workers who entered training, most of whom were
expected to still be in training at the time of the survey. The majority
of reemployed workers in four of the five sites earned less in their new
jobs than they had previously earned, but typically replaced about 80
percent or more of their prior earnings. In one site, however, slightly
more than half of the reemployed workers matched their prior wages. More
than half of reemployed workers returned to the manufacturing sector, and
at most sites workers who returned to manufacturing replaced about the
same proportion of their pre-layoff wages as workers reemployed in other
industries. Workers who entered training replaced slightly less of their
wages than workers who did not in all but one site, and those who were
trained generally left manufacturing for another industry. Our study
cannot be used to determine whether one set of services was more effective
than another, but only to document what happened to different workers who
chose different services. Labor has funded a long-term impact evaluation
of the Trade Adjustment Assistance program that may tell us more about the
effectiveness of various service strategies. The study is scheduled to be
completed by the end of 2008.

Few workers at each site received either the health insurance or wage
insurance benefit, but many workers told us they were unaware of these
benefits. Participation rates for the health insurance benefit, which
covers 65 percent of workers' monthly premiums for eligible health
insurance plans, did not exceed 12 percent of all workers at any site,
according to our survey. At most sites, less than half of affected workers
who visited one-stop centers said they were aware of the health insurance
benefit, although information on the program was provided to them at
information sessions. Workers in several sites told us they might have
applied for the health insurance benefit if they had known about it. Yet,
of the workers aware of the health insurance benefit at each site who did
not use it, about half or more said they did not need it because they had
other coverage available or they could not afford health insurance even
with the benefit's 65 percent tax credit. For example, the average cost of
insurance premiums for a family plan in Mississippi was about $1,000 per
month, leaving workers with an out-of-pocket cost of about $350 per month,
roughly 41 percent of the maximum monthly Unemployment Insurance benefit
of about $840 in Mississippi. Workers and officials also noted limited
participation and awareness for the wage insurance benefit-which provides
a wage subsidy for workers 50 years of age or older who find a job within
6 months of their layoff without training. At four of the five sites,
between 21 and 72 percent of workers were potentially eligible for the
wage insurance benefit, and fewer than one in five of these workers
received the benefit at any site. Workers at the fifth site were not
certified as eligible for the wage insurance program. Workers said in our
focus groups and on our survey that they had not participated in the
program because they were unaware of it, did not want to forfeit the
opportunity to take training for the $10,000 maximum wage subsidy, or were
unable to find work within 6 months of their layoff.

We are recommending that the Secretary of Labor provide guidance to states
and local one-stop centers to ensure that potentially eligible workers are
made aware of and understand the new health and wage insurance benefits
under the Trade Adjustment Assistance program. In its written comments,
Labor agreed with our findings and recommendations and noted steps it was
taking to implement them.

                                   Background

Dislocated workers who have lost their jobs as a result of international
trade are largely provided services through three federally funded
employment and training programs-the TAA program, the WIA Dislocated
Worker program, and the Wagner-Peyser ES program. These services are
provided through a consolidated service delivery structure called the
one-stop system. In order to encourage the streamlined delivery of
employment services, WIA was enacted in 1998 and required that the TAA,
WIA, ES, and other federally funded programs provide employment and
training services through the one-stop center system made up of nearly
2,000 individual one-stop centers operating in about 600 local workforce
areas across the nation. These program services may be provided directly
at a one-stop center, or at other locations through referrals.

Trade Adjustment Assistance Program

The TAA program was designed to assist workers who have lost their jobs as
a result of international trade. In order for workers to be eligible for
TAA benefits, Labor must certify that their layoff was trade affected.
This certification process begins when a petition on behalf of a group of
laid-off workers is filed with Labor. Petitions may be filed by a group of
at least three affected workers, the employer experiencing the layoff, a
union, or a state or local workforce agency. Labor has 40 days to
investigate whether workers were laid off as a result of international
trade, for example because of a shift in production to another country or
an increase in imports of articles like or similar to what the workers
were involved in producing. If Labor certifies the petition, it notifies
the state in which the layoff occurred, which then has responsibility for
contacting the workers eligible for TAA program benefits under the
petition. States must inform workers individually about the benefits
available to them as well as how to apply for benefits.

The TAA program provides two primary benefits-training and extended income
support. States have responsibility for approving training and determining
eligibility for extended income support, while local one-stop centers are
the main point of intake and actual delivery of TAA services and benefits.
Training benefits include vocational training, on-the-job training, and
remedial training (e.g., English as a second language or literacy).
Participants in TAA-approved training must attend training full-time.
Program participants may also receive a total of 104 weeks of extended
income support beyond the 26 weeks of UI benefits available in most
states. This includes 78 weeks of extended income support while workers
are completing vocational training, and another 26 weeks if workers are
completing remedial training. During their first 26 weeks of extended
income support, participants must either be enrolled in training, have
completed training, or have a waiver from this requirement. To qualify for
extended income support, participants must be enrolled in training by the
later of two dates: either 16 weeks after being laid off or 8 weeks after
Labor certified their petition. The maximum level of extended income
support payments in a state is set by statute at the state's maximum UI
benefit level.

The Trade Adjustment Assistance (TAA) Reform Act of 2002 added several new
benefits to the TAA program, including the Health Coverage Tax Credit
(HCTC).5 Workers must be enrolled in training or have a waiver from this
requirement to be eligible for the HCTC benefit that helps workers pay for
health care insurance through a tax credit covering 65 percent of their
premiums for qualified plans. Workers can choose to receive the tax credit
in one of two ways-as an advanced option that covers 65 percent of their
monthly premiums allowing them to lower the amount they have to pay out of
pocket for health coverage, or as an end of year tax credit that is
claimed on their income taxes. The tax credit is administered at the
federal level by the Internal Revenue Service (IRS) and three federal
departments-Treasury, Labor and Health and Human Services-share
responsibility for implementing HCTC. There are three health plan options
that are automatically HCTC-eligible:

COBRA continuation plans. Under the Consolidated Omnibus Budget
Reconciliation Act (COBRA) of 1985,6 certain employers with 20 or more
employees are required to offer 18 to 36 months of continued health care
coverage to former employees and their dependents who lose health coverage
due to certain circumstances, such as when a worker is laid off.
Generally, health care insurers may charge individuals purchasing COBRA
continuation coverage no more than 102 percent of the total premium.

Spousal coverage. Health care insurance obtained through a worker's
spouse's employer is also HCTC-eligible, provided that the employer
contributed less than 50 percent toward the cost of coverage.

5 For more information on TAA benefits such as HCTC see GAO, Trade
Adjustment Assistance: Reforms Have Accelerated Training Enrollment, but
Implementation Challenges Remain, GAO-04-1012 (Washington, D.C.: Sept. 22,
2004); and GAO, Health Coverage Tax Credit: Simplified and More Timely
Enrollment Process Could Increase Participation, GAO-04-1029 (Washington,
D.C.: Sept. 30, 2004).

6 Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985, Pub. L.
No. 99-272, Apr. 7, 1986.

Individual market plans. Workers may use HCTC to cover a portion of the
monthly cost of individually purchased health insurance coverage if the
worker purchased the coverage at least 30 days prior to being laid off.

In addition to the three options that are automatically qualified for
HCTC, the TAA Reform Act allows states to designate other coverage
alternatives-called state-qualified options-for HCTC recipients. For
example, states may make arrangements with individual health insurers,
among others, to provide HCTC-eligible coverage to TAA participants.

The Reform Act also established as a demonstration project a wage
insurance benefit for older workers-known as the Alternative Trade
Adjustment Assistance (ATAA) program. This program supplements the incomes
of workers 50 years of age or older who forgo TAA-funded training and are
able to find jobs within 26 weeks of being laid off that pay less than
$50,000 a year and pay less than what they previously earned. If workers
meet these criteria they are eligible to receive 50 percent of the
difference between their new and old wages up to a maximum of $10,000 over
2 years. Older trade-affected workers are only eligible for the wage
insurance program if the petition for TAA assistance that was filed with
Labor included a specific request for ATAA eligibility.

About $750 million was appropriated for income support for trade-affected
workers for fiscal year 2005, while another $259 million was appropriated
for training. Labor allocates 75 percent of these training funds to states
according to a formula that takes into account each state's previous year
allocations, accrued expenditures and participant levels. Labor holds the
remaining 25 percent of training funds in reserve, to distribute to states
throughout the year according to need. To cover administrative costs
associated with the TAA program, Labor allocates to each state an
additional 15 percent of its program allocation (see table 1). For
example, Pennsylvania was allocated $20.6 million in fiscal year 2004 to
provide trade-affected workers with training and other services, and an
additional $3.1 million was allocated to cover costs associated with
administering the TAA program. Labor sets and tracks national TAA
performance goals for job placement, job retention and wage replacement
outcomes, but there are no individual state performance goals.

Table 1: TAA Program Fund Allocations for Case Study States, Fiscal Year
2004

Dollars in millions
State         TAA training funds TAA administrative funds 
Missouri                    $4.8                     $0.7 
Pennsylvania                20.6                      3.1 
Washington                  13.4                        2 
Mississippi                  1.7                      0.3 
Massachusetts                5.2                      0.8 

Source: U.S. Department of Labor.

WIA Dislocated Worker Program

The WIA Dislocated Worker program is available to dislocated workers in
general and is not reserved for those affected by international trade. A
dislocated worker is an individual who (1) has been terminated or laid
off, or who has received a notice of termination or layoff, from
employment; is eligible for, or has exhausted entitlement to, UI or is not
eligible but has been employed for a sufficient duration to demonstrate
attachment to the workforce; and is unlikely to return to his previous
industry or occupation; (2) has been terminated or laid off, or has
received a notice of termination or layoff, from employment as a result of
any permanent plant closure of, or substantial layoff at a plant,
facility, or enterprise; (3) was self employed but is unemployed as a
result of general economic conditions in the community in which the
individual resides or because of natural disasters; or (4) is a displaced
homemaker.

Labor distributes 80 percent of the WIA Dislocated Worker funds ($1.5
billion in fiscal year 2005) directly to states, the District of Columbia,
and Puerto Rico based on a formula. States then distribute 60 percent of
these funds to local areas by formula to support WIA services for
dislocated workers. Each state can reserve no more than 25 percent of its
dislocated worker funds to provide rapid response services to help
dislocated workers transition quickly to reemployment, and up to 15
percent for other statewide activities. Labor retains 20 percent of
dislocated worker funds ($283 million in fiscal year 2005) in a national
reserve account to be used to provide states with national emergency
grants, demonstrations, and technical assistance.7

7 These national reserve funds are also used to provide annual allotments
to the outlying areas of the U.S. Virgin Islands, Guam, American Samoa,
the Commonwealth of Northern Mariana Islands, and the Republic of Palau.

Under the WIA Dislocated Worker program there are three sequential levels
of service available through the one-stop center system-core, intensive,
and training. The initial core services-including job search and placement
assistance, the provision of labor market information, and preliminary
assessment of skills and needs-are available to everyone. If a dislocated
worker is determined to be unable to find a job or has a job that does not
lead to self-sufficiency after core services, intensive services may be
made available, which include comprehensive assessments, development of an
individual employment plan, and case management. Dislocated workers who
are determined to be unable to obtain or retain employment after intensive
services can move on to training. At this level, dislocated workers can
receive services including occupational skills training and on-the-job
training.

The 1988 Worker Adjustment and Retraining Notification (WARN) Act
generally requires employers with 100 or more workers to give notice-often
called a WARN notice-to the affected workers' representatives (e.g., a
labor union) or the workers themselves if they have no representatives, as
well as to the state dislocated worker unit 60 days in advance of expected
plant closings or mass layoffs.8 Once an employer files a WARN notice with
the state's dislocated worker unit, a rapid response team is mobilized to
provide immediate and on-site contact with the employer experiencing
layoffs as well as with employee representatives to assess the needs of
affected workers. Generally workers are invited to attend a rapid response
meeting where they are provided with information about UI and other
federally funded employment and training services also available through
the one-stop center system. Typically, if they have reserved adequate
funds to provide rapid response services, states may also use rapid
response funds for services including providing additional assistance to
local areas that are experiencing increased unemployment, and to pay for
direct services such as training. States can also apply to Labor for
national emergency grant funds to provide additional employment and
training services to workers affected by mass layoffs and plant closings,
or to provide temporary assistance to workers affected by natural
disasters and other catastrophic events.

Labor monitors program performance by requiring states and localities to
track job seekers who receive core services that require significant staff
assistance, intensive services, and training. States and local areas are
required to monitor the outcomes of WIA Dislocated Worker program
participants on measures including job placement, job retention, and
earnings change. State performance targets are established annually
through negotiations between individual states and Labor. States, in turn,
negotiate WIA performance levels with each local area. Labor holds states
accountable for achieving their WIA performance levels by tying those
levels to financial sanctions and incentive funding.

8 Pub. L. No. 100-379, Aug. 4, 1988; 28 U.S.C. S: 2101.

Employment Service

The ES was created in 1933 by the Wagner-Peyser Act and was designed to
link job seekers with employers. ES is a partner in the one-stop center
system and offers a range of services that are available to all job
seekers and employers. About $800 million in ES funds was provided to
states for fiscal year 2005. For job seekers, ES provides services such as
job search assistance, job referral, and assessments, as well as
one-on-one case management. ES also offers employer services including
recruiting workers, screening applicants and helping employers manage
layoffs. Labor tracks program performance by measuring outcomes of job
seekers who received ES services against national goals related to job
placement and job retention.

Most Workers at Five Sites Received Some Reemployment Assistance, but Generally
                       Less Than a Third Entered Training

At all five sites, the majority of affected workers visited a one-stop
center and received some services, but at four of five sites only about a
third or less received training and long-term income support. At least
two-thirds of the workers in each site (ranging from 72 to 100 percent)
went to a one-stop center, and they most commonly received one-on-one
assistance such as job search assistance, according to our survey
estimates. In four of the five sites we studied, workers who did not go to
a one-stop center most commonly reported that they needed to find a job
right away and did not think they had time to visit a one-stop center, or
did not need help finding a job. Generally, one-third or less of the
workers in each site (ranging from 9 to 39 percent) enrolled in training.
Similarly, about one-third or less of the workers in each site received
long-term income support benefits-for 1 year or longer-which are available
to trade-affected workers in training who have exhausted their UI
benefits. Older workers were less likely to enter training, according to
our survey data.

Most Workers at Each Site Visited a One-Stop Center and Received One-on-One
Assistance

Over 70 percent of workers at each site visited a one-stop center,
according to our survey (see fig. 2). While all TAA-eligible Toro workers
visited a one-stop center since being laid off, over 80 percent of Toro
workers who were not eligible for TAA also visited a one-stop center.
Workers with lower pre-layoff wages were significantly more likely to
visit a one-stop center than workers with higher pre-layoff wages, and
women were twice as likely as men to visit a one-stop center, even after
accounting for other factors such as time since being laid off.9 General
Mills workers were also significantly less likely than workers in the
other sites to visit a one-stop center, which may have been linked to the
fact that the General Mills plant closure was TAA-certified several months
after the layoffs there began. According to union officials, many of the
workers had already been laid off by the time the petition was certified
and, because of this, Missouri state officials noted they had difficulty
reaching these workers to inform them about available benefits and
services.

9 Using data from our worker survey, we performed a multivariate
regression analysis to estimate the effects of age, gender, education
level, job tenure, time since layoff, pre-layoff wage, and layoff site on
the likelihood of visiting a one-stop center. The complete results of this
analysis are presented in app. III.

Figure 2: Most Dislocated Workers Visited a One-Stop Center

Note: In some cases, not all workers who were asked a particular question
in our survey answered the question. For all figures in this report that
use data from our survey, we have excluded from our calculations any
workers who were asked but either did not answer the relevant question(s)
or responded don't know.

Workers most commonly received one-on-one assistance such as job search
assistance (see fig. 3). Over half of the workers in each site reported on
our survey that they received one-on-one assistance at a one-stop center,
for example with how to look for a job or how to enroll in training.
Workers were somewhat less likely to receive assessments, attend
workshops, or use self-serve one-stop center services on their own. For
example, at one-stop centers at each site we visited, workers were able to
use computers to conduct on-line job searches or to up-date their resumes.
However, some workers at these sites told us that they did not use these
one-stop center resources, because they could use their home computers to
access on-line job banks or to work on their resumes. Additionally, most
workers who visited a one-stop center in four of the five sites we studied
reported that one-on-one assistance was more helpful than services such as
workshops and assessments.

Figure 3: Most Workers Received One-on-One Assistance at One-Stop Centers

To address the needs of some of these trade-affected workers, local
one-stop staff at one site designed a new service delivery process. Staff
at the Lewistown, Pa., one-stop center developed three service tracks as a
way to streamline the assistance they provided to workers affected by the
Lear plant closure (see fig. 4). Workers were placed into one of three
service tracks depending on their interests and goals. Workers interested
in getting a job right away were placed in the job seeking track that
included a series of workshops on interviewing and resume writing, while
workers interested in retraining were placed in the training/education
track that included several assessment tests to measure their basic skills
and to identify their career interests. A third service track was designed
for workers undecided about retraining or getting a job and included a
combination of workshops and assessments aimed at helping workers
determine if their job skills are in-demand and if their skill sets need
upgrading through training.

Figure 4: Service Tracks Available at the Lewistown, Pa., One-Stop Center

States used a variety of federal funds to provide reemployment services to
trade-affected workers. In all five sites we visited, state or local
officials told us that TAA administrative funds were insufficient to
provide TAA participants with case management services, and they relied on
other funding sources, particularly ES or WIA, to fund these services.10
Only two states-Missouri and Washington-used a portion of their TAA
administrative funds to fund one-on-one case management for TAA
participants at sites we studied. The proportion of TAA participants who
received services funded through WIA among the sites we studied ranged
from 8 percent of Toro workers in Mississippi to 37 percent of General
Mills workers in Missouri, according to administrative data.

Local areas experienced some difficulties in using local WIA resources to
serve trade-affected workers, according to officials in the sites we
visited, and in response three states used alternative funding sources to
provide these services. At some sites existing case management resources
were not sufficient to meet the needs of trade-affected workers as well as
other workers using one-stop center services. For example, one-stop
officials in Massachusetts told us that they are reluctant to dedicate WIA
case management resources to assist TAA participants, because WIA case
managers are already busy working with WIA program participants. In
addition, concerns about WIA performance measures, especially those
related to reemployment and wage replacement, may serve as a disincentive
for local areas to co-enroll TAA participants. According to state and
local officials in two states, TAA participants tend to have higher
earnings in their previous jobs than the average local job-seeker and are
less likely to find jobs that pay at or near what they previously earned,
which can count against their WIA performance measures. In response to
these concerns, three of the states we visited also used national
emergency grants-discretionary funds that Labor awards to states
experiencing large layoffs-or statewide rapid response funds to serve
trade-affected workers. Massachusetts, for example, initially used a
portion of its rapid response set aside funds to serve Sanmina-SCI
workers, and later used $540,000 in national emergency grant funds. These
funds were used to support additional case managers to provide Sanmina-SCI
workers with one-on-one assistance. Similarly, Missouri received about
$1.4 million in national emergency grant funds to hire additional staff
including case managers and to provide training for dislocated workers
affected by several lay-offs that occurred in the St. Louis area,
including the General Mills plant closure.

10 According to our earlier study, states have increasingly relied upon
WIA funds to provide services such as case management to TAA participants.
See GAO-04-1012 .

To address concerns that co-enrolling TAA participants in WIA may
negatively affect performance measures, Labor recently piloted an
initiative to encourage states to co-enroll participants in the WIA
Dislocated Worker program. The seven states participating in this
initiative are required to co-enroll all new TAA participants in the WIA
Dislocated Worker program from October 2005 to the end of June 2006.11
States may exclude these TAA participants' employment and wage replacement
outcomes from their WIA performance calculations when the outcomes
adversely affect their statewide performance. Labor currently intends to
track co-enrolled participants' outcomes across these seven states for
program years 2006 through 2008.

Workers Most Often Visited One-Stop Centers for Job Search Assistance and to
Learn More about Available Services and Benefits

Workers most often visited one-stop centers for two reasons-to learn more
about available services and benefits and to get job search assistance. At
least 80 percent of workers who visited a one-stop center at each site we
studied told us that the prospect of learning more about benefits and
services and getting assistance with finding a new job motivated them to
initially visit a one-stop center. According to state or one-stop center
officials in four of the five sites we studied, many workers do not have a
specific course of action in mind when they first visit a one-stop center
and are interested in getting more information about available services
and benefits. Some workers, however, are primarily interested in finding a
new job and visit one-stop centers for that purpose. Workers also reported
that they visited one-stop centers for other reasons including that they
heard from friends and co-workers that the one-stop center offered helpful
services, they were interested in enrolling in training for a new
occupation, or to maintain their UI benefits. Most workers at each site
learned about reemployment services available at the one-stop center from
a meeting held at or around the time of their layoff that provided them
with information about reemployment services, often called a rapid
response meeting. While over 70 percent of the workers at each site
attended rapid response meetings, more workers at the Toro plant in
Mississippi and the Sanmina-SCI plant in Massachusetts-where rapid
response meetings were held on company time-attended these meetings than
workers at the other sites.12

11 The states participating in Labor's co-enrollment project are Illinois,
Kentucky, Missouri, Oregon, Pennsylvania, South Carolina, and Texas.

At four of the five sites, between 12 and 28 percent of the workers did
not visit a one-stop center.13 Across these sites, between 47 and 71
percent of workers who did not go to a one-stop center said they did not
need help finding a job. Workers also often told us that they did not go
to the one-stop center because they needed to find a job right away and
did not think they had time to visit a one-stop center. Workers less
commonly reported that they did not visit a one-stop center because they
were unaware that job search and training services were available at
one-stop centers, that the one-stop center was located too far away from
where they lived, or that it was difficult to get to the one-stop center.

Over 60 percent of workers at each site who visited a one-stop center did
so in the first two months after being laid off (see fig. 5). Some
workers- less than 10 percent of workers at each site-went to a one-stop
center even before they lost their jobs. Workers in four of the five sites
we visited told us that they were aware of the TAA program's training
enrollment deadline and enrolled in training quickly. Some workers,
however, told us they initially felt that they could find employment
without the help of the one-stop center, and only used one-stop center
services when they were unable to find a job or a job that paid close to
their former wage.

12 According to state and local officials, rapid response sessions for
workers affected by the Weyerhaeuser layoff in Washington, the General
Mills layoff in Missouri, and the Lear layoff in Pennsylvania were not
held on company time.

13 All the TAA-eligible workers affected by the Toro layoff visited a
one-stop center.

Figure 5: Percentage of Workers Who Went to a One-Stop Center within 2
Months of Being Laid Off

About One-Third or Less of Workers Generally Received Training and Long-Term
Income Support

At most sites, relatively few workers had enrolled in training since being
laid off. In four sites, less than one-third of workers were currently or
had been enrolled in training at the time of our survey. At the remaining
site, Sanmina-SCI in Massachusetts, 39 percent of the workers had enrolled
in training (see fig. 6). Even after accounting for other factors that
could affect training enrollment, such as workers' age and gender,
Sanmina-SCI workers were significantly more likely to enter training than
workers at all the other sites.14 Among the Toro workers in Mississippi
who were not TAA-certified, 6 percent enrolled in training, compared to
the 18 percent of TAA-certified Toro workers who took training.

14 Using data from our worker survey, we performed a multivariate
regression analysis to estimate the effects of age, gender, education
level, job tenure, time since layoff, pre-layoff wage, and layoff site on
the likelihood of entering training. The complete results of this analysis
are presented in app. IV.

Figure 6: One-Third or Fewer of Workers at Most Sites Enrolled in Training

Of the workers at the sites we studied who entered training programs, most
entered programs that were relatively short-term and that cost less than
$10,000. At four sites, half or more of the workers who enrolled in
training were enrolled in programs expected to last 1 year or less,
according to administrative data (see fig. 7).15 At three of these sites,
about 30 percent or more of the workers in training entered programs
expected to last 6 months or less. In the sites we studied, shorter-term
training included, for example, a 2-month certification program in truck
driving or a 1-month nursing assistant program. Longer-term training
included 2-year associates degree programs at community colleges in fields
such as elementary education or heating, ventilation, and air conditioning
maintenance and repair. At each site, at least 60 percent of the workers
who enrolled in training entered programs with an expected cost of less
than $10,000. (For a detailed breakdown of training costs, see app. II.)

15 We used state administrative data to examine certain details of
workers' training programs that were not available through our survey
data. However, there was not an exact correspondence between states'
administrative records and our survey results regarding which workers
entered training. The level of agreement between administrative and survey
data on whether workers had entered training ranged from 82 to 95 percent
at the five sites. Also, at some sites, administrative data were not
available for all aspects of each worker's training program. For example,
a state may have been able to provide administrative data on the type of
training program a worker entered, but not on the expected duration of
that worker's program.

Figure 7: Workers in TAA- or WIA-Funded Training by Expected Length of
Training Program

Notes: Data on training duration were available for 105 General Mills
workers, 91 Lear workers, 25 Weyerhaeuser workers, 7 Toro workers, and 139
Sanmina-SCI workers. Because of rounding, totals do not always equal 100
percent.

While about half the workers at three of five sites received income
support for over 6 months, one-third or fewer at each site received
benefits for over 1 year-generally only available to trade-affected
workers in training who have already exhausted their UI benefits. At least
two-thirds of the workers at each site had received income support
benefits at the time of our survey, and at three sites about half the
workers had received these benefits for over 6 months (see fig. 8).
However, only about a third or less of the workers at each site had
received the benefits for over 1 year, and no more than 8 percent of the
workers at any site had received benefits for longer than 18 months.
Because most workers in the sites we studied did not enroll in training,
and those who did most commonly entered programs lasting 1 year or less,
the vast majority of the workers in these sites did not utilize the full 2
years of extended income support benefits available to them.16

Figure 8: Number of Months Workers Received Income Support Benefits (UI
and in Some Cases Extended Income Support)

Notes: Data include workers still receiving UI or extended income support
benefits at the time of our survey. For example, the Sanmina-SCI plant
closure occurred about 8 months before our survey, and 49 percent of
Sanmina-SCI workers were still receiving income support benefits at the
time of our survey. Because of rounding, totals do not always equal 100
percent.

16 TAA-certified workers may receive up to 104 weeks of extended income
support benefits beyond the 26 weeks of UI available in most states. This
total includes 78 weeks while workers are enrolled in vocational training,
and an additional 26 weeks if they are enrolled in remedial training.

The majority of workers at each site who enrolled in training received
vocational training. A few industry categories were consistently popular
across sites (see table 2, which provides information on training funded
by TAA and WIA). Training in health care occupations was among the more
popular choices at most sites, including training for jobs in direct care
(e.g., nursing assistant) and in administration (e.g., medical coding and
billing). Training in office and computer skills, ranging from basic
computer skills to more advanced network support and accounting skills,
was also among the most popular in most sites. Construction and trades,
including occupations such as electrician and plumber, were among the
popular fields in two sites-General Mills and Lear; and transportation,
including truck driving, was the leading field at Lear. Fewer workers at
each site entered remedial training, which includes courses in literacy,
English as a second language, and General Equivalency Diploma (GED)
preparation. The proportion of workers entering remedial training funded
by any source was highest at Sanmina-SCI in Massachusetts, where according
to administrative data 50 percent of the workers who entered training took
remedial training. One-stop center officials in Massachusetts told us a
number of training providers in the area offered programs that combined
GED preparation or English as a second language instruction with training
in vocational skills.

Table 2: Workers in TAA- and WIA-Funded Training by Program Type

                                                    Site
                               General                                        
                                 Mills  Lear Weyerhaeuser    Toro Sanmina-SCI 
Program type                  (Mo.) (Pa.)      (Wash.) (Miss.)     (Mass.)
Construction and trades         15%   28%           4%      0%          5% 
Health care                      27    20           12      14          10 
Manufacturing                     0     0            0       0           3 
Office and computer skills       36    15            4      29          21 
Remediala                         0     0            0       0          13 
Remedial in conjunction                                                    
with occupational skillsa         0     0            0       0          37
Social services and                                                        
education                         1     0            4      57           1
Transportation                   11    30            4       0           3 
On-the-job training               0     2            8       0           0 
Other                            10     4            0       0           7 
Unknown                           0     1           64       0           0 

Source: State administrative data.

Notes: Administrative data on training programs were available for 92
General Mills workers, 94 Lear workers, 141 Sanmina-SCI workers, 7 Toro
workers, and 25 Weyerhaeuser workers. Vocational training was most
commonly supported by TAA training funds, although WIA was also sometimes
used to pay for workers' training at the General Mills, Lear, and
Weyerhaeuser sites.

aSanmina-SCI was the only site where remedial training was funded by TAA
or WIA; remedial training was provided at other sites through, for
example, Adult Basic Education funds.

Most workers in sites in large metropolitan areas who entered training
attended proprietary schools, while workers in the other sites most
commonly attended public institutions such as community colleges and
vocational/technical schools. Seventy-five percent of the General Mills
workers and 71 percent of the Sanmina-SCI workers who entered training
attended proprietary schools. All of the Toro workers in Mississippi who
entered training attended a community college, as well as 63 percent of
the Weyerhaeuser workers in Washington who entered training and for whom
data are available. Public vocational/technical schools that serve high
school students as well as adults were the leading providers for Lear
workers in Pennsylvania, serving 48 percent of Lear workers who entered
training. (For a detailed breakdown of the training providers used by
workers at each site, see app. II.)

Age, Gender among Factors Affecting Training Enrollment

A variety of factors were associated with workers' decisions about whether
to enroll in training and what type of training to enter, according to our
survey analysis and according to officials and workers we spoke with. Some
of these factors were related to attributes of the individual workers,
such as their age or gender, while others affected all workers at a
particular site, such as the availability of training programs in the
local area.

  Workers' Characteristics

Older workers were less likely than younger workers to enter training.
Workers over age 55 at our five sites were significantly less likely than
younger workers to enter training, even after taking into account other
characteristics such as workers' gender and educational level, our survey
data indicate.17 Workers or one-stop center staff in four of the sites we
studied said age was a factor in workers' training decisions. For example,
one-stop center staff in Mississippi told us that older workers often
lacked the confidence to go back to school after many years away from the
classroom. The Weyerhaeuser plant closure in Washington affected a higher
proportion of workers age 55 and older (57 percent) than any of the other
closures, and according to our survey only 5 percent of these older
Weyerhaeuser workers entered training, compared to 14 percent of
Weyerhaeuser workers under age 55. One-stop center staff in Washington
said a large number of the older workers affected by the closure received
waivers from the training requirement under the TAA program because they
were nearing retirement;18 56 percent of Weyerhaeuser workers age 55 and
older retired, according to our survey.

Workers' gender affected the type of training program they entered and
sometimes whether they enrolled in training, according to officials in
three sites. One-stop center staff or training providers in multiple sites
said men are more likely to enter training in truck driving, while women
are more likely to enter training in nursing or other medical fields. And
officials in Missouri told us that in the St. Louis area, a shortage of
training programs in traditionally male occupations-such as construction
and auto body work-discourages some men from even seeking training. They
said it was expensive to operate training programs in some of these
fields, and potential providers are especially reluctant to invest in
expensive technology just for training purposes when the technology
changes rapidly.

17 This finding is based on the regression analysis of our survey results.

18 Under the TAA statute, one reason that workers may receive a waiver
from the training requirement is that they are within 2 years of
retirement.

Workers' skills at the time of their layoffs were a factor that sometimes
pushed workers into particular types of training and sometimes acted as a
barrier to training enrollment, according to workers, officials, or
training providers in the sites we studied. In particular, lack of basic
skills was often cited as a factor affecting training enrollment. For
example, the Sanmina-SCI site in Massachusetts had the highest proportion
of workers without a high school degree or GED (14 percent) among the
sites we studied, and it had the highest proportion of workers enrolled in
remedial training. One-stop center staff in Massachusetts said many of the
workers affected by the Sanmina-SCI plant closure lacked basic skills and
needed GED preparation or English as a second language instruction. In
Washington, a college official said inadequate math and science skills
constrained training options for some dislocated workers. These workers
chose to enter programs to become licensed practical nurses or certified
nursing assistants because they lacked the basic skills necessary to
enroll in training to become registered nurses. A one-stop center official
in Pennsylvania told us that workers need a minimum level of basic
reading, language and math skills to qualify for vocational training, and
that lack of basic skills may have prevented many Lear workers from
entering vocational training.

  Timing and Availability of Training Programs

The timing of training start dates affects which programs workers enter,
according to officials or workers in four sites. One-stop center or state
officials in these sites told us that community college training programs
typically have only a few starting dates-or only one starting date-per
year, and that the timing of program start dates is not always convenient
for laid-off workers. For example, officials in Missouri and Washington
explained that workers must sometimes wait a number of weeks until the
start of the next community college semester, because of a lag between the
worker's layoff and the start of the next semester. In these cases,
workers might choose to attend a proprietary school with an
open-enrollment policy rather than a community college, to avoid using up
several weeks of income support benefits while waiting to start training,
or they might opt for a shorter-term training program to avoid running out
of income support before completing training.

Officials in two sites that are not in large metropolitan areas said a
lack of training programs in the local area limited workers' training
options. One-stop center officials in Pennsylvania said a shortage of
affordable training programs in the Lewistown area, in particular the lack
of a community college, has been a barrier to training enrollment for Lear
workers. One Lear worker told us he was interested in a particular
training program at a community college, but he could not enroll in the
program in part because it would have been about a 50-mile commute each
way. Similarly, an official in Washington told us that there are limited
training programs in the Kelso/Longview area, and some workers relocated
in order to enroll in a program that is not offered in the Kelso/Longview
area.

  State Training Policies

States' maximum allowable TAA training cost per worker sometimes affected
workers' training decisions. Four of the states we visited-all except
Mississippi-have established a maximum limit or cap on TAA training costs
per worker (see table 3).19 Two of these states set different caps for
different types of training programs, such as a lower cap for remedial
training and a higher cap for vocational training. The maximum caps range
from $12,000 in Washington to $23,000 in Massachusetts. Workers or state
officials in three sites told us these caps sometimes affected workers'
training decisions. For example, a General Mills worker in Missouri told
us that she initially wanted to enroll in a medical billing certification
program that offered instructor-led training and an internship, but this
program's cost was higher than the state cap. She ultimately enrolled in a
less expensive, computer-based medical billing program.

Table 3: Maximum Allowable TAA Training Costs per Worker

State (affected company)    Maximum allowable TAA training cost per worker 
Missouri (General Mills)    $13,000                                        
Pennsylvania (Lear)         16,000                                         
Washington (Weyerhaeuser)   Public school-10,000 Private school-12,000     
Mississippi (Toro)          None                                           
Massachusetts (Sanmina-SCI) Remedial program-5,000 Vocational certificate  
                               program-15,000 Degree program-23,000           

Source: State officials.

19 In some states, training programs with costs exceeding the official
state cap are approved in special circumstances.

 Most Workers at Four of the Five Sites Found a Job or Retired after Being Laid
            Off, and Employment Outcomes Varied by Services Received

We found that most of the workers who lost their jobs because of foreign
trade at four of the five sites we studied had either found a job or
retired at the time of our survey. The majority of reemployed workers
earned less in their new jobs than they had previously earned, but
according to our survey estimates generally replaced about 80 percent or
more of their pre-layoff wages. Also, more than half of reemployed workers
returned to the manufacturing sector, and at most sites workers who
returned to manufacturing replaced about the same proportion of their
pre-layoff wages as workers who entered other fields. Workers who entered
training replaced slightly less of their wages than workers who did not in
all but one site, and those who were trained generally left manufacturing
for another industry. The outcomes for workers in our study are generally
similar to those found in an earlier study of laid-off workers in
industries significantly impacted by trade.20 Outcome measures allow an
assessment of whether a participant is achieving an intended outcome, but
they cannot measure whether the outcome is a direct result of program
participation. Labor has funded a long-term study of the effectiveness of
the TAA program, scheduled to be completed by 2008.

Most Workers at Four of Five Sites Were Reemployed or Retired after Being Laid
Off

The majority of workers at four of the five sites had either found a job
or decided to retire at the time of our survey. At three of the sites, 60
percent or more of the workers had found jobs (see fig. 9). In the fourth
site, Weyerhaeuser in Washington, less than half of the workers were
reemployed, but almost 60 percent of the Weyerhaeuser workers were age 55
or older and over half of these older workers retired.21 A number of the
reemployed Weyerhaeuser workers were simply rehired by Weyerhaeuser:
almost one-fourth of the workers affected by this plant closure were able
to find a new position at another part of the company. In the fifth site,
Sanmina-SCI in Massachusetts, only 37 percent of the workers had found new
jobs, but this layoff occurred more recently than any of the other
layoffs-only 8 months prior to the survey. In addition, Sanmina-SCI had
the highest proportion of workers who entered training, and most of these
workers were expected to still be in training at the time of our survey.
Of the Toro workers in Mississippi who were not TAA certified, 59 percent
were reemployed, about the same as the percentage of TAA-certified workers
at that site who had found new jobs. These findings are similar to those
of an earlier study of U.S. workers laid off from industries significantly
affected by trade where 63 percent of the workers had found reemployment
after their layoffs.22

20 See Kletzer. This study ranked manufacturing industries according to
the increase in the import share of each industry from 1979 to 1994. Those
industries in the top 25 percent in terms of increase in import share are
defined as high import-competing industries, or what we call industries
significantly affected by international trade. The study used data from
the Displaced Worker Surveys conducted by the Bureau of Labor Statistics
from 1984 to 2000. The Displaced Worker Survey is administered as part of
the Current Population Survey, a nationally representative monthly survey
of about 60,000 households.

21 At the time of the lay-off, Weyerhaeuser workers with at least 10 years
of service to the company and who were at least 55 years old were eligible
for early retirement. However, workers only received full retirement
benefits if they were at least 59 years old. Retirement was involuntary in
that these workers' positions were being eliminated.

22 See Kletzer.

Figure 9: Most Workers at Four of Five Sites Had Found Jobs or Retired at
the Time of the Survey

Note: Totals do not equal 100 due to rounding.

The workers who had entered training were the least likely to be
reemployed at each site, but it may be too soon to know the effect of
training on employment outcomes. Generally one-third or less of workers at
each site enrolled in training, and among this group, no more than half at
any site were reemployed. However, some of the workers who had enrolled in
training were expected to still be in training at the time of our survey,
according to administrative data.23 In two of the five sites, about 60
percent or more of the workers who had entered training were expected to
still be in training, and in the other three sites about a third were
expected to still be in training. Among those scheduled to complete
training by the time of our survey, over 60 percent were reemployed at all
sites but one-similar to the overall reemployment rate for most sites. At
the fifth site, Sanmina-SCI in Massachusetts, only 35 percent of workers
who were scheduled to complete training were reemployed.

23 TAA participants in training must be in full-time training, which may
make it more difficult for them to work while completing training.

Workers who did not go to a one-stop center were at least as likely to be
reemployed as those who visited a one-stop (but did not get training).24
In only two sites-Weyerhaeuser and Sanmina-SCI-were workers who did not
visit a one-stop center more likely to be reemployed than those who did.
For example, at Weyerhaeuser, 50 percent of those who did not visit a
one-stop center were reemployed compared with 39 percent of those who did
visit a one-stop center but did not get training.

About half or more of the workers at four of the five sites took at least
7 months to find their current job (see fig. 10).25 At the fifth site,
Sanmina-SCI, about one-fifth of the reemployed Sanmina-SCI workers took at
least 7 months to find their current jobs, but the Sanmina-SCI plant
closure occurred only 8 months before our survey. A smaller number of
workers found their current jobs more quickly-in four sites, about one in
five of the reemployed workers found their current jobs within 3 months.
By comparison, an earlier study of workers laid off from industries
affected by trade found that a larger proportion of workers were
reemployed more quickly-half of the workers found new jobs within 2 months
of being laid off, while 25 percent took over 6 months.26 Workers in the
five sites in our study who did not go to a one-stop center generally were
reemployed a bit more quickly than those who did. Of the reemployed
workers who did not go to a one-stop center, half or more found their
current jobs within 3 months of being laid off. Of those reemployed
workers who went to a one-stop center (but did not get training), between
14 and 45 percent found their current jobs within 3 months. This
difference may be due to time dedicated to receiving job search assistance
and other services to help them get a job.

24 We could compare outcomes for four sites only. At Toro, all laid-off
workers visited the one-stop center.

25 Our survey asked workers about their jobs at the time of the survey. We
did not ask about their work history since being laid off.

26 See Kletzer.

Figure 10: Number of Months Workers Took to Find Their Current Jobs

The Majority of Workers in Most Sites Earned Less in Their New Jobs, Replacing
about 80 Percent or More of Their Pre-Layoff Wages

The majority of reemployed workers in four sites earned less in their new
jobs than prior to being laid off, but at the fifth site-Weyerhaeuser in
Washington-slightly more than half the reemployed workers earned the same
or more than their prior wage. Reemployed workers at all five sites were
able to replace, on average, between 79 and 94 percent of their pre-layoff
wages (see fig. 11). Similarly, an earlier study of workers laid off from
industries significantly affected by international trade found that when
these workers were reemployed, they replaced, on average, about 87 percent
of their prior wages.27 Workers and officials told us that several of the
plants that we studied paid higher wages than other companies in the area.
Unless workers moved out of the area, they could not easily earn
comparable wages doing the same type of work. However, some reemployed
workers at each site-with the proportion ranging from 12 percent of
reemployed Toro workers in Mississippi to 53 percent of reemployed
Weyerhaeuser workers in Washington-were able to earn at least as much as
they had prior to their layoffs.

27 See Kletzer.

Figure 11: Workers Replaced About 80 Percent or More of Wages on Average

Workers in four of the five sites who did not go to a one-stop center had
a higher average pre-layoff wage than those who did. For example,
Weyerhaeuser workers who did not go to a one-stop center had an average
pre-layoff wage of about $30 an hour, while those who visited a one-stop
center (but did not get training) had an average pre-layoff wage of about
$27 an hour. When reemployed, workers who did not visit a one-stop center
generally replaced at least the same proportion of their pre-layoff wages
as those who did.28 With the exception of Lear, those who received
training had the lowest average pre-layoff wages. And at two of five
sites, these workers had the lowest average wage replacement rate when
reemployed (see table 4).

28 At the fifth site, Toro in Mississippi, all workers went to a one-stop
center. Therefore, we could not compare the employment outcomes for those
who visited a center to the outcomes for those who did not.

Table 4: Average Pre-layoff Hourly Wage and Wage Replacement Rates

                 Went to one-stop and                  Went to                          
                 enrolled in training                one-stop but                       
                                                       did not               Did not go 
                                                      enroll in                  to     
                                                       training               one-stop  
                                                         Average                 Average
                Average         Average      Average        wage     Average        wage
             pre-layoff wagereplacement   pre-layoff replacement  pre-layoff replacement
                 hourly            rate       hourly   rate when      hourly   rate when
               wage (in  whenreemployed     wage (in  reemployed    wage (in  reemployed
Company        dollars)       (percent)     dollars)   (percent)    dollars)   (percent)
General                  $15.67        82        $16.49        88         $17.97     95 
Mills                                                                                   
Lear                      16.22       92a         16.13        74          17.26     94 
Weyerhaeuser              25.35       71a         27.10        87          30.34    93c 
Toro                      13.83         b         15.21        81              b      b 
Sanmina-SCI               16.79        89         18.46        94          22.96    96c 

Source: GAO survey of dislocated workers.

Note: Some of the workers who entered training-ranging from about
one-third to over 60 percent among the five sites-were expected to still
be in training at the time of our survey, and it may have been more
difficult for these workers to have started a new job.

aThese estimates have margins of error of plus or minus 15 percent or less
of the value of the estimates.

bAll Toro workers went to a one-stop center. None of the Toro workers who
went to training have become employed, according to administrative data;
however, all but one were expected to still be in training at the time of
our survey.

cDifferences between estimates of average wage replacement rates for
workers who did not visit a one-stop center versus those who did were not
statistically significant at the 95 percent confidence level at
Weyerhaeuser and Sanmina-SCI.

The majority of the workers who had found new jobs at the time of our
survey said they were receiving some benefits such as health insurance
benefits or paid time off through their new employer (see fig. 12). Over
60 percent of the reemployed workers at each site received health
insurance benefits in their new jobs.29 In addition, about 75 percent or
more of the reemployed workers at each site received vacation time, sick
leave, or personal leave at their new place of employment. However, some
workers told us the benefits in their new jobs were less generous than the
benefits received from their former employer. Generally, fewer reemployed
workers received retirement benefits in their new jobs as compared to
health insurance benefits and paid time off.

29 Prior to the layoffs, employers at all five sites provided health
insurance benefits to their employees.

Figure 12: Most Workers Received Benefits in New Jobs

More than half of the reemployed workers at each site returned to jobs in
the manufacturing sector (see fig. 13). This was true for workers who
visited a one-stop center (but did not get training) as well as for those
who did not visit a center. Similarly, an earlier study of workers laid
off from manufacturing industries that were significantly affected by
international trade found that when these workers were reemployed, 52
percent of them returned to the manufacturing sector.30 When reemployed
workers did not return to manufacturing, we found they entered fields such
as professional and business services; trade, transportation, and
utilities; construction; and education, health care, and social services.
A higher proportion of workers who took training entered a new field. In
three sites, the majority of workers who enrolled in training and found
new jobs entered a field other than manufacturing.

30 See Kletzer.

Figure 13: More Than Half of Reemployed Workers Returned to Manufacturing

Note: The estimate for Toro has a margin of error of plus or minus 9
percent of the value of the estimate.

Reemployed workers who returned to manufacturing generally replaced about
the same proportion of their pre-layoff wages as those who entered other
fields. For example, at General Mills, workers who returned to
manufacturing had an average wage replacement rate of 90 percent, while
those who moved to other fields had an average replacement rate of 88
percent. However, at two of the sites-Weyerhaeuser and Sanmina-SCI-those
who stayed in manufacturing replaced a higher proportion of their
pre-layoff wages than those who did not. At Weyerhaeuser, where workers'
average pre-layoff wages were about $27 per hour, reemployed workers who
remained in manufacturing replaced 93 percent of their prior wages, while
those who entered new fields replaced 65 percent of their prior wages. At
Sanmina-SCI, where workers' average pre-layoff wages were lower-about $18
per hour-reemployed workers who remained in manufacturing replaced 96
percent of their prior wages, compared to 89 percent for those who entered
new fields.

Outcomes Alone Cannot Measure Program Impact

While outcome measures are an important component of program management in
that they assess whether a participant is achieving an intended
outcome-such as obtaining employment-they cannot, by themselves, measure
whether the outcome is a direct result of program participation. Other
influences, such as the condition of the local economy or an individual's
readiness to search for work or learn new skills, may affect his or her
ability to find a job as much or more than participation in an employment
and training program. We examined the outcomes for all workers affected by
the selected plant closures. However, we could not determine whether their
outcomes were a direct result of the services they received. To determine
whether participant outcomes are a result of services, rather than of
other factors, it is necessary to conduct an impact evaluation that can
take these and other factors into account when comparing workers'
outcomes.

Labor has funded a long-term study to assess the impact of TAA program
services such as training on participants' employment and earnings. The
goal of the study is to determine not only the outcomes achieved by TAA
participants, but also the impact of TAA program services-that is, whether
participants had better outcomes as a result of the program than they
would have if they had not received program services. Labor last completed
an evaluation of the TAA program in 1993, but methodological issues
resulted in inconclusive findings from that study. According to Labor
officials, the methodology used by the new study is an improvement over
the methodology used by the 1993 study, and should provide more conclusive
findings. The new study will compare the outcomes for a treatment group
(TAA participants in 25 states) and a comparison group (UI claimants in
the 25 states who are similar to the TAA participants in a number of
observable characteristics). It will examine, for example, the workers'
job search methods, their training outcomes, and their employment history
before and after being laid off. This methodology will likely allow an
assessment of the impact of the TAA program, rather than just outcomes.
Data collection began in 2005 and will continue until 2008, and a final
report is scheduled to be issued by the end of 2008.

  A Small Proportion of Workers in the Five Sites Received Health Insurance or
    Wage Insurance Benefits, but Many Workers Were Unaware of These Benefits

A small proportion of workers in the five sites received the health
insurance benefit (HCTC) or the wage insurance benefit (ATAA), but many
workers told us they were unaware of these benefits. Participation rates
for the HCTC benefit did not exceed 12 percent at any site, according to
our survey estimates. In most sites, over half of the workers who visited
a one-stop center said they were unaware of the benefit, despite efforts
by state and local officials to inform them about the benefit. Of the
workers who were aware of the benefit but did not use it, about half or
more at each site said they did not need it because they had other health
insurance, or it was too expensive. Likewise, few older workers received
the ATAA benefit. Awareness of the benefit varied greatly by site, ranging
from 0 percent of potentially eligible Toro workers in Mississippi to 81
percent of potentially eligible Lear workers in Pennsylvania. In addition,
some workers aware of the ATAA benefit chose not to receive it because
they did not want to forfeit their training benefits or because they did
not find a new job within 6 months of their layoff.

Few Workers Received HCTC at Any Site, and Less Than Half Knew about HCTC at
Most Sites

Few workers at the sites we visited received the HCTC benefit, but it is
difficult to assess the demand for this benefit among non-participants
because many workers told us they were unaware of the benefit.
Participation rates for HCTC, a benefit in which eligible participants may
receive a tax credit covering 65 percent of their premiums for certain
health insurance plans, did not exceed 12 percent at any site (see fig.
14). Men were significantly more likely to receive HCTC than women, and
Lear workers in Pennsylvania were significantly less likely to receive
HCTC than workers at any other site, when controlling for other
characteristics.31

31 Using data from our worker survey, we performed a multivariate
regression analysis to estimate the effects of age, gender, education
level, job tenure, time since layoff, pre-layoff wage, and layoff site on
the likelihood of participating in the HCTC program. In addition to gender
and site being statistically significant, we also found that workers with
less than 10 years of job tenure were significantly more likely to receive
HCTC than workers with 10 years or more job tenure, and that workers with
some college were less likely to receive HCTC than workers with less than
a high school degree. Also, we found workers laid off more recently were
less likely to receive the benefit. The complete results of this analysis
are presented in app. IV.

Figure 14: Across Sites, HCTC Participation Was Relatively Low

Most workers visited a one-stop center at all sites, and at four of the
five sites, fewer than half of these workers said they were aware of the
HCTC benefit (see fig. 15). Workers in several sites told us they might
have applied for HCTC if they had known about the benefit.

Figure 15: Percentage of Workers Who Visited a One-Stop Center Who Were
Aware of HCTC

Note: HCTC awareness was only assessed for those workers who went to a
one-stop center.

While state and local officials told us they took a number of steps to
inform workers about HCTC, these efforts were not always successful.
Officials in all sites said they discussed HCTC benefits at rapid response
sessions or TAA information meetings, and provided written literature on
HCTC to workers.32 These materials varied by site, and they were either
distributed at the rapid response meetings or mailed to workers at their
homes. State officials in Washington prepared a bright pink flyer to
distribute to workers highlighting the HCTC benefit, hoping that the
coloring of the flyer would draw workers' attention to the material. The
flyer also highlighted the state-established toll-free telephone number
that workers and local one-stop center staff could call to get further
information about the HCTC benefit. In Massachusetts, the state attaches a
HCTC brochure to letters sent to affected workers notifying them of their
potential eligibility for TAA. However, some workers told us they were
sometimes overwhelmed by the prospect of being laid off and by the volume
of information received at the time of the layoff, and, therefore, could
not absorb all of the information they received.

32Generally, employers are required to inform the state dislocated worker
unit 60 days in advance of an expected plant closure or mass layoff. A
rapid response team is then mobilized to provide information to affected
workers on available benefits and services.

While officials at all sites introduced HCTC at initial information
meetings and distributed literature on the benefit, we found that the
information provided to workers during follow-up discussions varied, and
state officials in the sites saw their roles differently. For example, in
Massachusetts and Pennsylvania, if workers asked detailed questions about
the benefit, case managers were instructed to have workers call the IRS's
toll-free HCTC number. A Massachusetts state official noted that because
of HCTC's complexity, it was too much to expect case managers to become
experts on the benefit and to be able to answer workers' questions. On the
other hand, case managers in Washington receive quarterly training on HCTC
from state officials. During these training sessions, case managers are
specifically instructed to tell clients about HCTC and are expected to
answer basic questions about the benefit.

About half or more of the workers at each site who were aware of HCTC and
chose not to participate said they did not need to use the benefit because
they had coverage through another source, such as through their spouse's
health insurance plan. Other reason that workers gave for not
participating in HCTC were that it was too expensive or too confusing (see
fig. 16). Some workers who said they had other coverage listed multiple
reasons why they did not participate in the benefit. After excluding those
who said they had other coverage, most workers at each site, who were
aware of HCTC, said that they did not participate because it was too
expensive. A smaller number of workers at each site said they did not
participate because the benefit was too confusing.33 (See app. III for
more detailed survey results on reasons workers chose not to participate.)

33The total number of workers who reported that they had no other health
care coverage and did not participate in the HCTC benefit in each site was
small, ranging from 6 Toro workers in Mississippi to 31 Sanmina-SCI
workers in Massachusetts.

Figure 16: Reasons for Not Participating in HCTC, among Workers Who Were
Aware of HCTC but Chose Not to Participate

Notes: Totals do not equal 100 because workers were given a series of
reasons and could answer yes to as many as applied to their situation.
These questions were only asked of workers who came to a one-stop center
and said they were aware of HCTC. (See fig. 15 for the percentage of
workers who visited a one-stop center and who were aware of HCTC.) The
estimates for General Mills, Weyerhaeuser, and Toro have margins of error
of plus or minus 13 percent of the value of the estimates.

About half or more of the workers in each site who were aware of HCTC, but
did not use it, told us that even with the benefit's 65 percent credit,
they could not afford the health care insurance premiums.34 The monthly
cost of available health care plans covering one worker in our five sites
ranged from $233 per month to $488 per month (see table 5).35 Premiums for
family plans ranged from $651 per month to $1,512 per month. Workers
receiving HCTC benefits would be responsible for paying 35 percent of
these amounts. With HCTC benefits, the least expensive individual plan
would cost $82 per month, and the least expensive family plan available
would cost $228 per month. Workers receiving UI benefits received maximum
monthly payments of between $840 and just over $2,000 depending on the
state they lived in. Depending on the type of health insurance plan
workers received, a large portion of their UI benefits could have been
spent on health care. For example, the average cost of insurance premiums
for a family plan in Mississippi was about $1,000 per month, leaving
workers with an out-of-pocket cost of about $350 per month, roughly 41
percent of the maximum monthly UI benefit of about $840 in Mississippi.
For four states, these costs were for COBRA continuation plans only. 36
Pennsylvania also had two state-qualified options that were available in
the county where the Lear layoff occurred, but the monthly premiums for
these plans were generally no less expensive than for COBRA continuation
plans.37

34 While most of the workers who said they did not receive HCTC because of
cost told us that it was the ongoing premium payment that was too high, a
slightly lower percentage said that it was the initial months of
unsubsidized premiums. Workers choosing the monthly payment option for
HCTC are usually responsible for paying the entire premium until their
applications are processed. (See also GAO-04-1029 for additional
information.) A mechanism exists to provide interim health insurance cost
assistance until the first payment processes under the HCTC program.
Labor's Office of Inspector General recently published a report finding
low participation for this mechanism, and their findings on reasons
workers did not participate were similar to ours. For example, they found
that reasons for non-participation included that workers could not afford
premiums even with this assistance and that workers found the program to
be too complex. (See "Performance Audit of Health Coverage Tax Credit
(HCTC) Bridge and Gap Programs," DOL-02-05-204-03-330.)

35 In some cases, plans have different deductibles that workers are
responsible for paying.

36 Under COBRA, workers are eligible to continue their employer sponsored
health care insurance plan at their own expense, but at the group rate the
employer paid, if they lose coverage because of reasons including loss of
employment. Generally, health insurers may charge workers purchasing COBRA
continuation plans no more than 102 percent of the total premium.

Table 5: Monthly Costs for HCTC-Eligible Health Insurance Plans Available
to Dislocated Workers at Each Site

                                                          Cost of             
                                                           family             
                                                             plan             
                                                            after             
                                                             HCTC Approximate 
                               Cost of individual         subsidy     monthly
                                   plan afterHCTC         (35% of  maximum UI
                   Individual     subsidy (35% of  Family   total     benefit
                         plan         total cost)    plan   cost)   available
General Mills $233 to $341         $82 to $119 $733 to $257 to      $1,000 
(Mo.)                                             $997    $349 
Lear (Pa.)      235 to 389           82 to 136  651 to  228 to       1,912 
                                                     1237     433 
Weyerhaeuser    296 to 381          104 to 133  834 to  292 to       2,040 
(Wash.)                                           1089     381 
Toro (Miss.)           388                 136     993     348         840 
Sanmina-SCI     331 to 488          116 to 171   1,026  359 to       2,032 
(Mass.)                                             to     529 
                                                    1,512         

Source: Published premiums by health insurers and employer data.

Note: Range of premiums include COBRA plans and state qualified coverage
options.

In addition, some workers chose not to receive HCTC because they found the
benefit confusing. For example, one Sanmina-SCI worker from Massachusetts
commented during the survey that the 10-page pamphlet he received from the
state on HCTC was too confusing. Similarly, a Lear worker in Pennsylvania
said he had to take the pamphlets he received to the one-stop center for
additional explanation. When the one-stop officials referred him to a
phone number, he decided it was too difficult to pursue the benefit.
Workers at another site said that they did not understand that they could
receive HCTC benefits under their spouse's health care plan in some
circumstances.

In a prior report,38 we recommended that Labor help individuals better
understand HCTC, including the eligibility requirements, and Labor has
begun to take steps to help inform workers about the program. For example,
Labor held forums for state agency staff on integrating dislocated worker
services in early 2004, which included discussions of the HCTC benefit. In
addition, Labor is developing fact sheets on HCTC for states to distribute
to trade-affected workers at rapid response meetings and at one-stop
centers. Labor has also informally encouraged states to have local case
managers talk about HCTC with clients. Despite these efforts, many workers
were still unaware of HCTC at the time of our survey.

37 Washington currently has an HCTC-eligible state-qualified option, but
the option was not available at the time of the Weyerhaeuser layoff.

38 See GAO-04-1029 .

Few Workers Received Wage Insurance Benefits at Any Site

Few workers participated in the wage insurance benefit at the four sites
that were certified for Alternative Trade Adjustment Assistance (ATAA), a
program that subsidizes some of the difference between the prior and new
wages of older trade-affected workers who find reemployment quickly. At
the four sites which were ATAA-certified, between 21 percent and 72
percent of the population were age 50 or older and, therefore, potentially
eligible for the wage insurance benefit.39 No more than one in five of
these potentially eligible workers participated in ATAA at any site. For
example, at Lear in Pennsylvania, where the largest proportion of
potentially eligible workers received ATAA, about 30 percent were 50 years
of age or older at the time of the survey, but only about 18 percent of
these older workers (or about 5 percent of all Lear workers) actually
received ATAA (see fig. 17).

39 To determine potential eligibility, we included workers who said they
were 50 years of age or older at the time of the survey. Not all of the
workers we identified as potentially eligible could necessarily have
received ATAA benefits. To receive ATAA benefits, workers must be able to
obtain reemployment within 6 months in a job that pays less than their
prior job, and be willing to forgo TAA-funded training. These criteria
were not included in our calculation of potentially eligible workers.

Figure 17: Few Workers Participated in ATAA

While state or local officials in three ATAA-certified sites told us that
they discussed the ATAA benefit at rapid response meetings and TAA
information meetings, workers' awareness of the ATAA benefit varied
greatly at the sites we visited. Awareness among workers who were 50 years
old and older and visited a one-stop center ranged from zero percent of
Toro workers in Mississippi to 81 percent of Lear workers in Pennsylvania
(see fig. 18). State or local officials at three of the four
ATAA-certified sites told us they discussed the ATAA benefit at rapid
response meetings or TAA information meetings. However, some workers said
they were overwhelmed by the volume of information received after the
layoff, and some told us they did not necessarily recall ATAA specifics.
Labor officials are taking steps to promote the ATAA benefit, such as
informally encouraging states to ensure case workers talk about ATAA
during one-on-one case management sessions.

Figure 18: Percentage of Older Workers Who Visited a One-Stop Center and
Were Aware of ATAA

Workers gave additional reasons for not participating in the ATAA benefit.
According to several state and local officials, workers may not want to
give up the opportunity to enter training for the $10,000 wage subsidy.
Several older workers also reported on our survey that they did not
receive ATAA, in part, because they did not find a new job within 6 months
of their layoff. Officials and older workers told us that it was difficult
for older workers to find new jobs. For example, a dislocated Weyerhaeuser
worker told us he would have been willing to forfeit his training benefits
for ATAA had he been able to find a job within 6 months of the layoff.
However, he said that the high wages that he had earned from Weyerhaeuser
may have discouraged potential employers.

                                  Conclusions

The TAA program targets manufacturing workers affected by international
trade, who may have fewer transferable skills and face greater challenges
to reemployment than other dislocated workers. The program provides a
unique blend of services and benefits that have been designed to meet
these workers' needs-some of which are not available to other dislocated
workers. But little has been known about whether the services provided are
the right mix for today's workers who are dislocated due to trade. This
study provides a glimpse of the needs of a small group of workers, the
services they received, and their employment outcomes about 8 to 22 months
after their layoffs.

Workers affected by these layoffs have taken a variety of paths. A large
majority sought some assistance from their one-stop center. Relatively
small numbers chose to enroll in training, but those who did often used
this opportunity to chart a new career path. A few did not seek any
federally funded reemployment services, and yet were still successful in
getting a new job. We cannot know all the factors that motivated workers
to seek particular services or that affected their employability, and we
cannot assess the role that TAA services played in the outcomes workers
achieved. It may be that some workers make an independent assessment of
what they need to help them rejoin the workforce and then try to take the
necessary steps to make that happen.

While few workers took advantage of training and long-term income support
through the TAA program, even fewer made use of two new benefits under the
TAA program-health insurance assistance and wage insurance for older
workers. Workers who knew about the benefits sometimes told us that the
benefit levels were not high enough to get them to participate. But
relatively large numbers were simply not aware of the benefits, and some
said they might have applied for the benefits had they known about them.
Sometimes workers admitted to being overwhelmed by the prospect of losing
their jobs and by the wealth of information they initially received.
However, states' efforts to inform workers about and explain these
benefits have been mixed at best-some trained their case managers to
answer questions from workers, while others did not see that as their
role. Despite Labor's efforts to encourage states to make this information
more widely available, many workers still do not know about these benefits
and, as a result, cannot make use of them. Without better information,
these workers may not have the opportunity to avail themselves of benefits
that could ease their transition to reemployment.

                      Recommendations for Executive Action

We recommend that the Secretary of Labor provide guidance to states and
local officials on how to better ensure that workers are aware of two new
benefits under the TAA program:

           o  the Health Coverage Tax Credit and
           o  the Alternative Trade Adjustment Assistance program.

This guidance should clarify that workers need additional information
beyond what is provided at initial informational meetings.

                                Agency Comments

We provided a draft of this report to officials at Labor for their review
and comment. In its comments, Labor agreed with our findings and
recommendations, noting a number of steps it has already taken to improve
access to HCTC and ATAA for eligible workers. Labor also acknowledged that
more needs to be done, saying that many of the difficulties encountered in
providing services and administering benefits are driven by the
complexities of the systems used to implement the program. Labor noted
additional steps it will be taking to help ensure access to services, such
as working with the IRS and states to identify and resolve HCTC issues as
they arise, and developing a revised TAA benefits brochure for workers to
be distributed by states. Labor also provided technical comments which
were incorporated as appropriate. A copy of Labor's response is in
appendix X.

As arranged with your offices, unless you publicly announce the contents
of this report earlier, we plan no further distribution of this report
until 15 days from the date of this report. At that time, we will send
copies of this report to the Secretary of Labor, relevant congressional
committees, and others who are interested. Copies will also be made
available to others upon request. The report is also available at no
charge on GAO's Web site at http://www.gao.gov .

Please contact me on (202) 512-7215 if you or your staff have any
questions about this report. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of the report. Key contributors to this report are listed in appendix XI.

Sigurd R. Nilsen Director, Education, Workforce, and Income Security
Issues

Appendix I: Methodology Appendix I: Objectives, Scope, and Methodology

We examined (1) the extent to which workers accessed federally funded
reemployment services and the mix of services received, (2) the employment
outcomes these workers achieved, and (3) the extent to which workers used
the new health insurance and wage insurance benefits under the Trade
Adjustment Assistance (TAA) program, and the factors affecting their
participation. To address these issues, we selected five plant closures
that were determined by the U.S. Department of Labor to be related to
international trade, visited each layoff site, conducted a telephone
survey of workers affected by each plant closure, held focus groups with
affected workers, and collected state administrative data on services and
benefits received. We also interviewed officials from Labor. We conducted
our work from November 2004 to December 2005 in accordance with generally
accepted government auditing standards.

Case Study Site Selection

To obtain information for this report, we judgmentally selected five plant
closures based on several criteria. First, we selected five states by
considering factors such as states' prior TAA training allocations and
number of TAA participants, the manufacturing products that have been
affected by mass layoffs in different states, and geographic diversity. We
then chose plant closures within the five states that met several
criteria: the plant closures were determined to have been related to
international trade by the U.S. Department of Labor, and therefore all or
some of the affected workers were potentially eligible for the TAA
program; the plants manufactured a variety of products; the closures
affected between 100 and 500 workers; and the closures occurred after the
TAA Reform Act of 2002 was enacted. We also sought to achieve a mix of
sites in rural and metropolitan areas. Based on these criteria, we
selected plant closures that had occurred at General Mills (Mo.), Lear
(Pa.), Sanmina-SCI (Mass.), Toro (Miss.), and Weyerhaeuser (Wash.).
Because we studied only five plant closures and because of the method of
selection, we cannot conclude that our findings are representative of the
experiences of trade-affected workers nationwide.

Site Visits and Focus Groups

We visited each site to obtain information on the plant closures and to
learn about the experiences of the affected workers. During the site
visits, we interviewed state and local officials, training providers, and,
when available, company and union officials. We also held focus group
discussions with workers at each site to learn more about workers'
experiences with employment and training services. Focus group
participants were recruited by one-stop center case managers, as it was
not feasible for us to recruit focus group participants at each site.
Because of this selection method, the focus group participants did not
include any workers who had not visited a one-stop center. This selection
method could have introduced bias into the focus group results; however,
the information we obtained from focus groups was used only to provide
examples. We conducted 15 focus groups in total, with between two and
seven workers participating in each focus group. A total of 69 workers
participated across all sites (see table 6). The questions used for the
focus groups covered topics such as workers' experiences with one-stop
center services and training and the helpfulness of those services,
knowledge about and participation in the HCTC and ATAA programs, and
employment outcomes. GAO facilitators conducted the focus groups, the
discussions were tape recorded, and transcripts were professionally
prepared.

Table 6: Number of Focus Groups and Participants by Site

                       General                                                
                         Mills    Lear   Weyerhaeuser      Toro   Sanmina-SCI 
Company               (Mo.)   (Pa.)        (Wash.)   (Miss.)       (Mass.)
Number of focus                                                            
groups                    3       3              2         3             4
Number of                                                                  
participants              9      11             11        14            24

Source: GAO analysis.

Review of State Administrative Data

We reviewed state administrative data on workers' demographics and
services received, and, when available, state wage records on workers'
employment outcomes. The data we reviewed included workers' age, education
level, weeks of UI received, training program enrollment, cost of
training, and reemployment status. Administrative data were not available
for every worker in each site. We recoded certain elements in the raw data
so that they would be comparable across sites. For example, we recoded
workers' training programs into a few standardized categories. When
recoding the data, we reached a team consensus on the recodes and
independently checked each recode. We assessed the reliability of the data
by interviewing state officials who had provided the data, performing edit
checks of the data, and comparing the administrative data to information
generated from the telephone survey. Based on these methods, we found
state data quality processes and procedures to be sufficiently reliable
for the purposes of our report.

Telephone Survey

We conducted a telephone survey of all workers who were laid off from the
five plants we studied. The survey was designed to obtain information on
workers' experiences with local one-stop centers, HCTC, and ATAA; use of
UI benefits; employment outcomes; and demographics. We obtained lists of
affected workers at each site from state officials. Prior to administering
the survey, we pre-tested the survey questions with workers at each site,
and made changes to the questions based on these pretests. The data from
15 completed pre-tested interviews were incorporated into the final
dataset.

The surveys were administered via phone by a contractor hired by GAO.1 The
survey was conducted from April 19, 2005, through June 24, 2005. The
survey administration included the following elements: (1) advance letters
were mailed to all dislocated workers approximately 5 to 7 days prior to
the start of data collection to provide information on the study and add
legitimacy and saliency to the survey; (2) all interviews were conducted
via Computer Assisted Telephone Interviewing (CATI), and a minimum of 10
callbacks were made to each worker to maximize contact and response rates;
and (3) all cases with missing information or incorrect contact
information were researched via several avenues to find the most accurate
information for each worker. Survey response rates for each survey ranged
from 66 percent to 86 percent (see table 7). Some of the reasons workers
did not complete the survey included that their phone numbers were no
longer in service, they had passed away since their layoff, they had
limited English skills, or they declined to complete the survey.

Table 7: Survey Response Rates by Site

                                                Toro (Miss.)         
              General                                                            
                Mills  Lear Weyerhaeuser                         Not Sanmina-SCI 
  Company       (Mo.) (Pa.)      (Wash.) TAA-certified TAA-certified     (Mass.)
  Number of       436   308          205            40            72         472 
  workers                                                            
  Number of       285   262          160            34            52         348 
  respondents                                                        
  Response        66%   86%          81%           85%           72%         75% 
  rate                                                               

Source: GAO analysis.

Note: A small number of out-of-scope workers were subtracted from the
population for certain sites, for purposes of calculating the survey
response rates. Workers were considered out-of-scope if they had quit or
retired prior to the layoff, or were still working at the plant at the
time of the survey.

1 Due to a technical problem with the survey administration, GAO staff
separately asked TAA-certified workers in Mississippi the HCTC and ATAA
questions.

We investigated the magnitude of potential non-response bias in the
results of dislocated worker surveys at the five locations, and concluded
that there was no significant non-response bias at any of the five
locations. We compared administrative data on worker demographics and
services received for survey respondents and the overall population and
found there generally were not significant differences between survey
respondents and the overall population for each site. Therefore, we chose
to generalize the survey results to the entire population of affected
workers at each site. We generated estimates for each site by treating the
responding workers as simple random samples from each of the populations.

Because we decided to treat the respondents as simple random samples, our
results are estimates of the populations and thus are subject to sampling
errors that are associated with samples of this size and type. Our
confidence in the precision of the results from these samples is expressed
in 95 percent confidence intervals, which are expected to include the
actual results in 95 percent of samples of this type. All percentage
estimates have margins of error of plus or minus 7 percent or less unless
otherwise noted. All wage related estimates have relative margins of error
of plus or minus 10 percent or less unless otherwise noted.

The practical difficulties of conducting any survey may introduce other
errors, commonly referred to as non-sampling errors. These errors can
occur if survey respondents have difficulty interpreting a particular
question, lack information necessary to answer a question, are
uncomfortable with accurately reporting certain sensitive information, or
do not answer certain questions, among other factors that affect data
collection and measurement. We took steps in the development of the
survey, the data collection, and the data analysis to minimize these
non-sampling errors.

Regression Analysis of Survey Data

As a complement to our interviewing and focus group efforts we also
applied logistic regression analysis to our survey data to identify
factors affecting the likelihood that workers received a set of services.
Specifically, we examined the effects of a series of demographic and other
variables from our survey on the likelihood of a worker (1) coming into a
one-stop center, (2) receiving training, and (3) receiving HCTC. The
demographic and other variables we examined included gender, age,
education, tenure in previous job, pre-layoff wage, and time since layoff.
The full results of this analysis are presented in app. IV.

Appendix II: Detailed Breakdown of Workers' Training Providers and Costs
by Site Appendix II: Detailed Breakdown of Workers' Training Providers and
Costs by Site

Table 8: Workers in TAA- and WIA-Funded Training by Provider Type

                                                    Site
                               General                                        
                                 Mills  Lear Weyerhaeuser    Toro Sanmina-SCI 
Provider type                 (Mo.) (Pa.)      (Wash.) (Miss.)     (Mass.)
Community college               15%   15%          40%    100%         14% 
Four-year college or              1     0            8       0          11 
university                                                     
Public vocational/technical       4    48            4       0           1 
school                                                         
Proprietary school               75    26            4       0          71 
Non-profit agency                 0     0            0       0           1 
Employer (e.g., on-the-job        2     2            8       0           0 
training)                                                      
Other                             1     9            0       0           2 
Unknown                           1     1           36       0           0 

Source: State administrative data.

Notes: Administrative data on training providers was available for 92
General Mills workers, 94 Lear workers, 141 Sanmina-SCI workers, 7 Toro
workers, and 25 Weyerhaeuser workers. Because of rounding, totals do not
always equal 100 percent.

Table 9: Workers in TAA- and WIA-Funded Training by Expected Program Cost

                                              Site
                       General                                                
Expected program      Mills    Lear    Weyerhaeuser     Toro   Sanmina-SCI 
cost                  (Mo.)   (Pa.)         (Wash.)  (Miss.)       (Mass.)
$4,999 or less          27%     21%              8%      83%           43% 
5,000-9,999              47      43              68       17            36 
10,000-14,999            19      18              16        0            15 
15,000-19,999             5      16               8        0             7 
20,000 or more            3       2               0        0             0 

Source: State administrative data.

Notes: Administrative data on training cost was available for 105 General
Mills workers, 91 Lear workers, 134 Sanmina-SCI workers, 6 Toro workers,
and 25 Weyerhaeuser workers. Because of rounding, totals do not always
equal 100 percent.

Appendix III: Detailed Breakdown of Participation in HCTC Appendix III:
Detailed Breakdown of Participation in HCTC

The following tables provide further detailed analysis of workers' use of
HCTC and their reasons for not participating in the benefit. Table 10
provides information on the number of workers who visited a one-stop
center and were aware of the HCTC benefit and whether they participated in
HCTC. Table 11 provides information on the reasons given by workers for
not participating in HCTC. Note that in Table 11 respondents could choose
more than one of these reasons for not participating.

Table 10: Workers' participation in HCTC

                               General                                        
                                 Mills  Lear Weyerhaeuser    Toro Sanmina-SCI 
                                 (Mo.) (Pa.)      (Wash.) (Miss.)     (Mass.)
Total number of affected                                                   
workers                         436   308          205      40         472
Total number of survey                                                     
respondents                     285   262          160      34         348
Total number of workers who                                                
went to a one-stop center                                      
and were aware of HCTC           80   136           61      14         115
Number of workers who said                                                 
they were participating in                                     
HCTC                             33    26            5       2          15
Number of workers who said                                                 
they were considering                                          
participating in HCTC or                                       
expecting to get the                                           
benefit                           5    12           10       0          13
Number of workers who said                                                 
they were not participating                                    
in HCTC                          42    98           46      12          87

Source: GAO survey of dislocated workers.

Table 11: Key Reasons Workers Gave for Not Participating in HCTC

                               General                                        
                                 Mills  Lear Weyerhaeuser    Toro Sanmina-SCI 
                                 (Mo.) (Pa.)      (Wash.) (Miss.)     (Mass.)
Number of workers who did                                                  
not participate in HCTC          42    98           46      12          87
Workers who said they had                                                  
other health coverage            29    62           36       6          46
Workers who said they did                                                  
not have other health                                          
coverage                         12    30            8       6          31
Workers who did not respond                                                
whether or not they had                                        
other health coverage             1     6            2       0          10
Of those workers who said                                      
they did not have other                                        
health coverage                                                
The number of workers who                                                  
only said they did not                                         
participate in HCTC because                                    
the benefit was too                                            
expensive                         7    12            5       2          13
The number of workers who                                                  
only said they did not                                         
participate in HCTC because                                    
the benefit was too                                            
confusing                         2     5            0       1           1
The number of workers who                                                  
said they did not                                              
participate in HCTC because                                    
the benefit was both too                                       
confusing and too expensive       1    10            1       2           7
The number of workers who                                                  
gave other reasons for not                                     
participating in HCTC             0     1            2       1           9
The number of workers who                                                  
gave no reason for not                                         
participating in HCTC             2     2            0       0           1

Source: GAO survey of dislocated workers.

Note: For an overview of responses to HCTC-related questions by layoff
site see GAO-06-44SP .

Appendix IV: Regression Analysis of Survey Data Appendix IV: Regression
Analysis of Survey Data

To determine what factors were related to whether workers went to a
one-stop center, received training, or received HCTC benefits, we used
multivariate logistic regression models to estimate the effects of several
factors. The advantage of the multivariate approach is that the effect of
any given factor is estimated after its relationship with other factors is
taken into account. The factors we considered were sex, age, education,
tenure, time since the layoff, pre-layoff wage, and site, or the plant
where the worker had been employed.

The logistic regression approach requires that we use odds and estimate
differences in the odds by taking their ratios. Table 12 below provides an
example of how odds and odds ratios are calculated. The top panel of table
12 shows that 88 percent of female workers visited a one-stop center,
compared to 80 percent of male workers. Alternatively, we can calculate
the odds on women and men visiting a one-stop center, which were 291/38 =
7.7 and 608/150 = 4.0, respectively. These odds imply that 7.7 women
visited a one-stop center for every woman that did not, and that 4.0 men
visited a one-stop center for every man that did not. Moreover, the ratio
of the two odds, 4.0/7.7 = 0.52 can be interpreted as meaning that the
odds on visiting a center were only half as large for men as for women.
While this might seem inconsistent with the difference between 88 percent
and 80 percent, consider that 12 percent of the women but 20 percent of
the men (nearly twice the percentage) did not visit a one-stop center.
When the factor being considered has more than two categories, we choose
any one category arbitrarily as the referent category, and calculate the
ratios of the odds for all other categories relative to that one. For
example, in the bottom panel of table 12 we see the odds on visiting a
one-stop center in each of the five sites, and odds ratios which indicate
how much different the odds were for every site relative to General Mills.
These odds ratios indicate that at the Sanmina-SCI, Lear, and Weyerhaeuser
sites, the odds on visiting a one-stop center were greater than in General
Mills, by factors of 2.3, 2.8, and 2.0, respectively. The odds were
highest at the Toro site, in fact, but because all workers visited a
center in that site, the odds, and thus the odds ratio, are undefined.

Table 12: Numbers and Percentages of Workers Who Visited a One-Stop
Center, by Sex and Site, and Odds and Odds Ratios Derived from Them

              Sex                    No     Yes Total       Odds on      Odds
                                                            visited     ratio
              Female          38    291    329   7.658       
                           11.6%  88.5% 100.0%               
              Male           150    608    758   4.053 0.529 
                           19.8%  80.2% 100.0%               
              Total          188    899   1087               
                           17.3%  82.7% 100.0%               
              Site                                           
    Visited   Sanmina-SCI     50    298    348   5.960 2.326 
    one-stop               14.4%  85.6% 100.0%               
     center   Toro             0     34     34       a     a 
                               0 100.0% 100.0%               
              General         80    205    285   2.563       
              Mills                                          
                           28.1%  71.9% 100.0%               
              Lear            32    230    262   7.188 2.805 
                           12.2%  87.8% 100.0%               
              Weyerhaeuser    26    134    160   5.154 2.011 
                           16.3%  83.8% 100.0%               
              Total          188    901   1089               
                           17.3%  82.7% 100.0%               

Source: GAO survey of dislocated workers.

a Indicates odds and odds ratios that cannot be estimated given that there
were no TAA-certified Toro workers who did not visit the one-stop center.

Table 13 shows the effects of the different factors on visiting a one-stop
center (first column), receiving training (second column), and receiving
the HCTC benefit (third column) when we use multivariate logistic
regression models to estimate their effects simultaneously. As noted
above, the advantage to this approach is that it allows us to estimate the
effect of each factor after taking account of the fact that the different
factors are related to each other (i.e., males and females in the sample
may have different lengths of service or wages, workers at different sites
may vary by sex, education, etc.) and have sometimes intertwined effects
on the outcomes of interest.

Table 13: Odds Ratios Describing the Effects of Various Factors on the
Likelihoods of Visiting a One-Stop Center, Receiving Training, and
Receiving HCTC

                                    Service
Factor               One-Stop Center Training   HCTC 
Female                                        
Male                          0.486*    0.737 1.947* 
Under 40                                      
40 - 55                        1.094    0.702  1.159 
Over 55                        0.659   0.455*  1.152 
< High School                                 
High School Graduate           0.965    0.784  0.649 
Some College                   1.407    1.464 0.464* 
College Graduate               0.631    0.925  0.551 
Unknown Education              0.397    1.756  0.752 
< 10 Years Tenure                             
10 - 19 Years Tenure           1.267    0.906 0.410* 
>19 Years Tenure               1.228    1.103 0.368* 
Time Since Layoff              0.989     .981 1.025* 
Pre-layoff Wage               0.617*    0.766  0.925 
Sanmina-SCI                   3.191*   3.595* 2.200* 
Toro                         11.980*          2.200* 
General Mills                          2.385* 2.200* 
Lear                          3.191*   2.385* 
Weyerhaeuser                 11.980*          2.200* 

Source: GAO survey of dislocated workers.

Notes: Asterisks indicate effect coefficients that are significant at the
0.05 level.

The numbers of cases used in the analyses were 987 (one-stop center), 842
(training), and 821 (HCTC).

The model for each outcome in this table is one that imposes simplifying
constraints on the differences between sites. That is, we selected for
each outcome a model that included dummy variables for sites or groups of
sites that were significantly different from others. Equal odds ratios
across sites imply that the only difference across those sites were due to
random fluctuations or chance. We used formal tests of the difference in
the fit of models to determine whether the more parsimonious models
adequately described the significant differences across sites.

Sex, pre-layoff wage, and site are the only factors that have significant
effects on the likelihood of visiting a one-stop center. Men were roughly
half as likely as women to visit a one-stop center (odds ratio of .486).
Better paid workers were less likely to visit a center as well, with every
$10 increase in pre-layoff wage diminishing the odds of visiting a center
by a factor of 0.617. Net of the other factors, workers at the Toro and
Weyerhaeuser sites were nearly 12 times as likely as workers at General
Mills to visit a center, and workers at the Sanmina-SCI and Lear sites
were roughly 3 times as likely as workers at General Mills to do so. This
implies that (1) workers at Toro and Weyerhaeuser were similar with
respect to the likelihood of visiting a center; (2) workers at Sanmina-SCI
and Lear were likewise similar; and (3) workers at Toro and Weyerhaeuser
were 11.98/3.19 = 3.8 times as likely to visit a center as workers at
Sanmina-SCI and Lear. Once these effects, and the differences across
sites, were taken account of, none of the other factors (i.e., age,
education, etc.) appeared to have any significant effect.

The only factors that had significant net effects on the likelihood of
receiving training were age and site. Workers over age 55 were less than
half as likely to receive training as workers under age 40. Workers at
Sanmina-SCI were more than three times as likely to receive training, and
workers at General Mills and Lear were more than twice as likely to
receive training, as workers at Toro and Weyerhaeuser.

Finally, the factors which affected whether workers received the HCTC
benefit were sex, education, tenure, time since layoff, and site. Men were
twice as likely as women to receive HCTC, and workers with some college
were half as likely as workers with less than a high school education to
receive the HCTC benefit. Workers with 10 or more years of service were
less than half as likely to receive HCTC as workers with less than 10
years, and workers laid off earlier were more likely to receive the
benefit, because each additional month since the layoff increases the odds
on receiving it by a factor of 1.025. Net of these effects, workers at
every plant except Lear were alike, and more than twice as likely as the
workers at Lear to receive the HCTC benefit.

Appendix V: General Mills Plant Closure (Hazelwood, Mo.) Appendix V:
General Mills Plant Closure (Hazelwood, Mo.)

The General Mills plant located in Hazelwood, Mo. (population 26,000 in
2004) shut down in 2003. Hazelwood is a city located 18 miles northwest of
St. Louis and most of the plant's employees lived in the St. Louis
metropolitan area in St. Louis County (see table 14). The St. Louis
metropolitan area experienced several large layoffs in 2003 that affected
almost 1,000 manufacturing workers and left the metropolitan area with one
of the state's highest unemployment rates in 2003. State and local
officials say that food manufacturing, once a major employer in the St.
Louis metropolitan area, is in a state of decline, resulting in few
dislocated General Mills workers being able to find new jobs with the
area's existing food manufacturers.

Table 14: Profile of St. Louis County, Mo.

Population, 2003 estimate                                        1,013,123 
High school graduates, persons 25                                      88% 
years old and older, 2000         
Median household income, 1999                                      $50,532 
Unemployment rate 2004 annual                                         5.4% 
average                           
Unemployment rate 2003 annual                                         5.2% 
average                           
Unemployment rate 2002 annual                                         4.7% 
average                           
Major employment sectors, 2000      Education, health, and social services 
                                                (22%) and manufacturing (13%) 

Source: U.S. Census Bureau and U.S. Bureau of Labor Statistics.

General Mills is an international company that produces an array of
packaged consumer foods such as cereals, refrigerated and frozen dough
products as well as snacks and yogurt. General Mills employed over 27,000
workers and operated 36 plants in the United States in 2004. General
Mills' Hazelwood plant produced frozen dough products such as cakes and
doughnuts, employed over 400 workers at the time it closed, and paid
workers an average of $12.45 per hour-comparable to wages paid in the St.
Louis metropolitan area by other employers. The affected workers were
predominantly male, 40 years old or older, had worked at the plant for at
least 10 years, and had at least a high school diploma (see table 15).
State and union officials told us that the workers were not considered
highly skilled. Most of the workers were unionized through the Bakery,
Confectionery, Tobacco Workers and Grain Millers International Union.

Table 15: Characteristics of Workers at General Mills' Hazelwood Plant

Age                                                                Percent 
39 years and younger 40-54 years 55 years and older                 116921 
Gender                                                            
Male Female                                                           5743 
Education                                                         
No high school diploma/GED High school diploma/GED Some            5553541 
post-secondary education Four-year college degree or more Other   
Years worked at plant                                             
Less than 5 years At least 5 years, less than 10 years At least   16114825 
10 years, less than 20 years At least 20 years                    

Source: GAO survey of dislocated workers and Washington state
administrative data.

Note: Percentages of some characteristics may not add up to 100 percent
because of rounding.

The General Mills plant completely ceased operations in October 2003 as a
result of a shift in production to Canada. General Mills gave the state of
Missouri official notice of its intentions to close its plant on December
18, 2002, and began laying off workers in waves beginning in January 2003
and ending in October 2003 (see fig. 19). According to the employer, only
some salaried employees were offered transfers to other General Mills
plants. Unionized workers were not eligible for transfers to other General
Mills plants. A group of workers from the Hazelwood plant submitted a
petition for TAA eligibility with Labor. Labor began its investigation in
June 2003 and certified the layoff as TAA eligible in July 2003. Workers
were not eligible for the wage insurance program (ATAA), which was not
implemented until August 2003.

Figure 19: Time Line of General Mills Plant Closure, Hazelwood, Mo.

Appendix VI: Lear Plant Closure (Lewistown, Pa.) Appendix VI: Lear Plant
Closure (Lewistown, Pa.)

The Lear plant in Lewistown, Pa. (population of about 8,800 in 2003)
closed in 2004. Most of the plant's employees lived in Lewistown, the
largest town in rural Mifflin County in central Pennsylvania (see table
16). The town is relatively geographically isolated: it is situated in a
valley, with about a 30-mile drive over mountain roads to the nearest
city. The Lewistown area experienced four mass layoff events between 2002
and 2004, including the closure of the Lear plant. The resulting loss of
about 700 jobs had a significant impact on the local economy, according to
Pennsylvania state officials.

Table 16: Profile of Mifflin County, Pa.

Population, 2003 estimate                                           46,335 
High school graduates, persons                                       77.2% 
25 years and over, 2000        
Median household income, 1999                                      $32,175 
Unemployment rate, 2004 annual                                        6.8% 
average                        
Unemployment rate, 2003 annual                                        7.6% 
average                        
Unemployment rate, 2002 annual                                        8.8% 
average                        
Major employment sectors, 2000 Manufacturing (30%); education,health care, 
                                  and social services (18%); and retail trade 
                                                                        (14%) 

Source: U.S. Census Bureau and U.S. Bureau of Labor Statistics.

Lear manufactures automobile interiors, and had about 300 plants
nationwide at the time it closed its Lewistown plant. The Lewistown plant
produced automobile carpets; employed about 300 workers; and paid wages of
$15 to $17 per hour, some of the highest in the area. The workers at the
plant were predominantly male and age 40 or older, most had worked at the
plant for at least 10 years, and the vast majority had at least a high
school diploma (see table 17). They also had fairly specialized job
skills, according to local officials. Most of the workers were unionized
through UNITE (formerly the Union of Needletrades, Industrial and Textile
Employees). The union did not play an active role in serving the workers
when they were laid off, according to some workers and officials.

Table 17: Characteristics of Workers at Lear's Lewistown Plant

Age                                                                Percent 
39 years and younger 40 - 54 years 55 years and older               236215 
Gender                                                             
Male Female                                                           7327 
Education                                                          
No high school diploma/GED High school diploma/GED Some             577136 
post-secondary education Four-year college degree or more          
Years worked at plant                                              
Less than 5 years At least 5 years, less than 10 years At least 10 8154830 
years, less than 20 years At least 20 years                        

Source: GAO survey of affected workers and state administrative data.

Note: Percentages for some characteristics may not add up to 100 percent
because of rounding.

The Lear plant in Lewistown was closed on February 15, 2004, primarily as
a result of a shift of production to another country. Lear officially
notified the state of Pennsylvania of the Lewistown plant closure on
October 1, 2003, and most workers were laid off from the plant between
November 2003 and February 2004 (see fig. 20). Twenty-six of the workers
laid off from Lear's Lewistown plant were hired at Lear's plant in
Carlisle, Pa. (approximately 60 miles from Lewistown) and then laid off
primarily in January 2005 when production was reduced at that plant. A
group of workers from the Lewistown plant submitted a petition for TAA
eligibility. Labor began its investigation of the petition in October
2003, and certified the affected workers as TAA-eligible in November 2003,
finding that the plant closure was related primarily to a shift of
production to Canada. Labor also certified the workers as eligible for the
wage insurance (ATAA) program.

Figure 20: Time Line of Lear Plant Closure, Lewistown, Pa.

Appendix VII: Weyerhaeuser Plant Closure (Longview, Wash.) Appendix VII:
Weyerhaeuser Plant Closure (Longview, Wash.)

The Weyerhaeuser plant located in Longview, Wash. (population 35,943 in
2003) shut down 2003. Most of the plant's employees lived in or around the
Longview metro area in Cowlitz County situated along Washington's
southeastern border with Oregon (see table 18). Longview lies about 50
miles east of Portland, Oregon, and 100 miles south of Tacoma, Wash.
Cowlitz County experienced several large layoffs from 2001 to 2003 that
affected more than 1,600 workers and left the county with the state's
second highest unemployment rate in 2004. According to state and local
officials, these layoffs have had a significant impact on the local
economy, and while a few years ago laid-off workers were quickly absorbed
by other local employers, laid-off workers are now having difficulty
finding jobs.

Table 18: Profile of Cowlitz County, Wash.

Population, 2003 estimate                                           95,146 
High school graduates, persons 25                                    83.2% 
years old and older, 2000         
Median household income, 1999                                      $39,797 
Unemployment rate 2004 annual                                         8.5% 
average                           
Unemployment rate 2003 annual                                        10.4% 
average                           
Unemployment rate 2002 annual                                        11.4% 
average                           
Major employment sectors, 2000          Manufacturing (21%) and education, 
                                            health, and social services (20%) 

Source: U.S. Census Bureau and U.S. Bureau of Labor Statistics.

Weyerhaeuser is an international company that manufactures a host of
wood-related products, ranging from paper and paper packing products to
finished wood products such as lumber used in home construction.
Weyerhaeuser's fine paper plant produced paper commonly used for copying
and printing. Weyerhaeuser employs about 65,000 workers internationally of
which about 27,000 work in its plants across the United States.
Weyerhaeuser operated its fine paper plant on its 700-acre company campus
in Longview. Over 200 workers were employed at the fine paper and pulp
plant and about 2,000 at Weyerhaeuser's campus overall. Weyerhaeuser still
operates several other production lines on this campus. According to state
officials, Weyerhaeuser is considered one of the best companies to work
for in the Longview area and pays some of the area's highest wages. Entry
level positions at the fine paper plant started at $17 per hour and most
affected workers were earning an average of $24 per hour. Affected workers
were considered highly skilled and most had at least a high school diploma
(see table 19). The majority of the workers were male, 55 years of age or
older, and had worked at the plant for at least 20 years. The workers were
unionized through the Association of Western Pulp and Paper Workers. State
and local one-stop center officials told us that they worked closely with
union representatives to coordinate outreach and services for affected
workers.

Table 19: Characteristics of Workers at Weyerhaeuser's Longview Plant

Age                                                                Percent 
39 years and younger 40 - 54 years 55 years and older                83657 
Gender                                                             
Male Female                                                           8911 
Education                                                          
No high school diploma/GED High school diploma/GED Some            3424881 
postsecondary education Four-year college degree or more Other     
Years worked at plant                                              
Less than 5 years At least 5 years, less than 10 years At least 10  032473 
years, less than 20 years At least 20 years                        

Source: GAO survey of dislocated workers and Washington state
administrative data.

Note: Percentages of some characteristics may not add up to 100 percent
because of rounding.

The plant ceased operations in mid-2004 as a result of a shift in
production to Canada. Weyerhaeuser gave the state of Washington official
notice of its intentions to close its fine paper plant on November 26,
2003, and workers were laid off in waves beginning in November 2003 and
ending in August 2004 (see fig. 21). According to the employer, almost 50
workers were reabsorbed at other Weyerhaeuser plants operating in Longview
or Cosmopolis, Wash. (almost 100 miles from Longview). In accordance with
union rules affected workers were able to bid on positions held by junior
Association of Western Pulp and Paper Workers members working at
Weyerhaeuser. Furthermore, many affected workers were also eligible for
retirement. The union negotiated an early retirement option available to
workers who had at least 10 years of service to the company and were at
least 55 years old. The union filed a petition for TAA eligibility with
Labor. Labor began its investigation of the petition in November 2003 and
certified the layoff as TAA eligible in January 2004. Workers were also
certified as eligible for the wage insurance (ATAA) program.

Figure 21: Time Line of Weyerhaeuser Plant Closure, Longview, Wash.

Appendix VIII: Toro Plant Closure (Oxford, Miss.) Appendix VIII: Toro
Plant Closure (Oxford, Miss.)

The Toro plant located in Oxford, Miss. (population of about 12,700 in
2003) shut down in 2004. Oxford is the largest city in rural Lafayette
County in northern Mississippi, and most of the plant's employees either
lived in Lafayette County or surrounding counties (see table 20).
According to local officials, Lafayette County experienced four mass
layoff events and plant closures between 2002 and 2004, including the Toro
plant, which contributed to a 40 percent reduction in manufacturing jobs
in the county.

Table 20: Profile of Lafayette County, Miss.

Population, 2003 estimate                                           40,188 
High school graduates, persons 25                                    78.5% 
years old and older, 2000         
Median household income, 1999                                      $28,517 
Unemployment rate 2004 annual                                         4.8% 
average                           
Unemployment rate 2003 annual                                         4.9% 
average                           
Unemployment rate 2002 annual                                        3.2 % 
average                           
Major employment sectors, 2000      Education, health, and social services 
                                       (33%); manufacturing (12%); and retail 
                                                                  trade (11%) 

Source: U.S. Census Bureau and U.S. Bureau of Labor Statistics.

Toro designs, markets, and manufactures landscaping equipment, and
employed about 5,200 employees worldwide in 2004. Toro's Oxford plant
produced two-cycle engines for lawnmowers, employed about 110 employees,
and paid workers between $8.50 and $15 per hour depending on their job
title. Approximately 40 employees were machinists (who created the engine
parts produced at the Oxford plant) and the remaining 70 employees
included assemblers (who put the engine parts together). Only the
machinists were TAA-certified. Most machinists at the plant were male, 40
years old or older, had worked at the plant for at least 10 years, and had
at least a high school diploma (see table 21). The workers were not
unionized.

Table 21: Characteristics of TAA-Certified Workers at Toro's Oxford Plant

Age                                                                Percent 
39 years and younger 40-54 years 55 years and older                 355312 
Gender                                                             
Male Female                                                           6139 
Education                                                          
No high school diploma/ GED High school diploma/ GED Some           353440 
post-secondary education Four-year college degree or more          
Years worked at plant                                              
Less than 5 years At least 5 years, less than 10 years At least 10  322716 
years, less than 20 years At least 20 years                        

Source: GAO survey of affected workers and state administrative data.

Note: Percentages for some characteristics may not add up to 100 percent
because of rounding.

The Toro plant in Oxford was closed on July 30, 2004, at least partly as a
result of a shift of production to China. Toro gave the state of
Mississippi official notice of its intentions to close the Oxford plant on
January 30, 2004, and most workers were laid off during April and May 2004
(see figure 22). The company submitted a petition for TAA eligibility to
Labor on behalf of the workers. Labor began its investigation of the
petition on January 26, 2004, and certified the 40 machinists as
TAA-eligible on February 19, 2004, because the plant closure was related
to a shift of machining two-cycle engine components to China. However,
Labor did not certify the assemblers as TAA-eligible because it determined
Toro was shifting the assembly of two-cycle engines to another domestic
facility. Labor also certified the machinists as eligible for the wage
insurance (ATAA) program.

Figure 22: Time Line of Toro Plant Closure, Oxford, Miss.

Appendix IX: Sanmina-SCI Plant Closure (Wilmington, Mass.) Appendix IX:
Sanmina-SCI Plant Closure (Wilmington, Mass.)

The Sanmina-SCI plant located in Wilmington, Mass. (population of about
22,000 in 2003) closed in 2004. Wilmington is in Middlesex County roughly
16 miles northwest of Boston (see table 22). About two-thirds of the
plant's employees lived in Massachusetts, and almost a third lived in New
Hampshire. Economic conditions during 2004 and 2005 have been varied among
the communities where Sanmina-SCI workers lived. Some of these workers
lived in communities that have experienced a number of trade-related
layoffs in recent years, and have had relatively high unemployment. But
other Sanmina-SCI employees lived in communities that had lower
unemployment rates and, according to local officials, experienced strong
job growth.

Table 22: Profile of Middlesex County, Mass.

Population, 2003 estimate                                        1,466,561 
High school graduates,                                               88.5% 
persons 25 years and over,    
2000                          
Median household income, 1999                                      $60,821 
Unemployment rate, 2004                                               4.4% 
annual average                
Unemployment rate, 2003                                               5.3% 
annual average                
Unemployment rate, 2002                                               5.0% 
annual average                
Major employment sectors,          Educational, health and social services 
2000                          (24%); professional, scientific, management, 
                                 administrative and waste management services 
                                               (16%); and manufacturing (12%) 

Source: U.S. Census Bureau and U.S. Bureau of Labor Statistics.

Sanmina-SCI is an electronics manufacturing company with operations in
over 20 countries. The Wilmington plant produced printed circuit boards
and employed almost 500 workers at the time it was closed. The workers at
the plant were predominantly male, age 40 or older, and over half had
worked at the plant for at least 10 years. At least three-quarters had a
high school diploma or GED (see table 21). The workers were not unionized.

Table 23: Characteristics of Workers at Sanmina-SCI's Wilmington Plant

Age                                                                Percent 
39 years and younger 40 - 54 years 55 years and older               236215 
Gender                                                          
Male Female                                                           7030 
Education                                                       
No high school diploma/GED High school diploma/GED Some                    
post-secondary education Four-year college degree or more Other 1441251210
Years Worked at Plant                                           
Less than 5 years At least 5 years, less than 10 years At least            
10 years, less than 20 years At least 20 years                    15264514

Source: GAO survey of affected workers and state administrative data.

Note: Percentages for some characteristics may not add up to 100 percent
because of rounding.

The Sanmina-SCI plant in Wilmington was closed in September 2004, at least
partly as a result of a shift of production to another country.
Sanmina-SCI officially notified the state of Massachusetts of the
Wilmington plant closure on July 20, 2004, and most workers were laid off
from the plant between August and October 2004 (see fig. 23). The company
submitted a petition for TAA eligibility to Labor. Labor began its
investigation of the petition in July 2004 and certified the affected
workers as TAA-eligible in August 2004 because the plant closure was
related to a shift of production to Malaysia. Labor also certified the
workers as eligible for the wage insurance (ATAA) program.

Figure 23: Time Line of Sanmina-SCI Plant Closure, Wilmington, Mass.

Appendix X: Comments from the Department of Labor Appendix X: Comments
from the Department of Labor

Appendix XI: A Appendix XI: GAO Contact and Staff Acknowledgments

GAO Contact

Sigurd R. Nilsen, Director (202) 512-7215

Acknowledgments

Dianne Blank, Assistant Director

Lorin Obler, Analyst-in-Charge

In addition, the following staff made major contributions to this report:
Irene J. Barnett and Amanda Mackison served as team members; James Ashley,
David Dornisch, Beverly Ross, Douglas Sloane, and Shana Wallace provided
guidance and assistance with design and methodology issues; Jonathan
McMurray advised on report preparation; Jessica Botsford advised on legal
issues; Avrum Ashery and Karen Burke provided graphic design assistance;
and Ramona Burton, Anne Cangi, Maureen Driscoll, Anna Kelley, Christopher
Murray, Carol Patey, Michelle St. Pierre, and Wayne Sylvia verified our
findings.

Related GAO Products Related GAO Products

Workforce Investment Act: Labor and States Have Taken Actions to Improve
Data Quality, but Additional Steps Are Needed. GAO-06-82 . Washington,
D.C.: November 14, 2005.

Workforce Investment Act: Substantial Funds Are Used for Training, but
Little Is Known Nationally about Training Outcomes. GAO-05-650 .
Washington, D.C.: June 29, 2005.

Unemployment Insurance: Better Data Needed to Assess Reemployment Services
to Claimants. GAO-05-413 . Washington, D.C.: June 24, 2005.

Workforce Investment Act: Employers Are Aware of, Using, and Satisfied
with One-Stop Services, but More Data Could Help Labor Better Address
Employers' Needs. GAO-05-259 . Washington, D.C.: February 18, 2005.

Health Coverage Tax Credit: Simplified and More Timely Enrollment Process
Could Increase Participation. GAO-04-1029 . Washington, D.C.: September
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Trade Adjustment Assistance: Reforms Have Accelerated Training Enrollment,
but Implementation Challenges Remain. GAO-04-1012 . Washington, D.C.:
September 22, 2004.

Workforce Investment Act: States and Local Areas Have Developed Strategies
to Assess Performance, but Labor Could Do More to Help. GAO-04-657 .
Washington, D.C.: June 1, 2004.

National Emergency Grants: Labor Is Instituting Changes to Improve Award
Process, but Further Actions Are Required to Expedite Grant Awards and
Improve Data. GAO-04-496 . Washington, D.C.: April 16, 2004.

Workforce Investment Act: One-Stop Centers Implemented Strategies to
Strengthen Services and Partnerships, but More Research and Information
Sharing Is Needed. GAO-03-725 . Washington, D.C.: June 18, 2003.

Older Workers: Employment Assistance Focuses on Subsidized Jobs and Job
Search, but Revised Performance Measures Could Improve Access to Other
Services. GAO-03-350 . Washington, D.C.: January 24, 2003.

Workforce Investment Act: Better Guidance and Revised Funding Formula
Would Enhance Dislocated Worker Program. GAO-02-274 . Washington, D.C.:
February 11, 2002.

Workforce Investment Act: Improvements Needed in Performance Measures to
Provide a More Accurate Picture of WIA's Effectiveness. GAO-02-275 .
Washington, D.C.: February 1, 2002.

Trade Adjustment Assistance: Experiences of Six Trade-Impacted
Communities. GAO-01-838 . Washington, D.C.: August 24, 2001.

Trade Adjustment Assistance: Trends, Outcomes, and Management Issues in
Dislocated Worker Programs. GAO-01-59 . Washington, D.C.: October 13,
2000.

(130421)

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www.gao.gov/cgi-bin/getrpt? GAO-06-43 .

To view the full product, including the scope

and methodology, click on the link above.

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Highlights of GAO-06-43 , a report to congressional requesters

January 2006

TRADE ADJUSTMENT ASSISTANCE

Most Workers in Five Layoffs Received Services, but Better Outreach Needed
on New Benefits

At all five trade-related plant closures that GAO studied, about
three-quarters or more of the workers received reemployment assistance
through a one-stop center, and they most often received one-on-one
services such as job search assistance, according to our survey estimates.
About a third or less of the workers at most sites received training and
long-term income support, with workers over age 55 less likely to enter
training than younger workers. Workers who did not visit a center most
often said they needed to find a job right away and did not think they had
time to visit a center, or did not think they needed help finding a new
job.

At the time GAO conducted its survey, most of the workers had either found
a new job or retired. At three sites, over 60 percent of the workers were
reemployed. At another site, only about 40 percent were reemployed, but
another third had retired. And at the final site, about a third were
reemployed, but this site had the highest proportion of workers who
entered training and most of them were likely still in training. The
majority of reemployed workers at four of five sites earned less than they
had previously-replacing about 80 percent or more of their prior wages-but
at one site over half the reemployed workers matched their prior wages.

Few workers at each site received either the health insurance benefit or
the wage insurance benefit available to some older workers. No more than
12 percent of workers at each site received the health insurance benefit,
and at four of five sites, fewer than half the workers who visited a
one-stop center were aware of it. Many workers did not use it because they
had other coverage or because the cost of available health insurance was
too high. No more than one in five of the older workers at each site
received the wage insurance benefit, and at two sites, fewer than half the
older workers who visited a center were aware of it.

Most Workers in Four of Five Sites Found Jobs or Retired

Little is known nationally about the extent to which workers laid off as a
result of international trade use the variety of federally funded
reemployment services available to them. GAO was asked to study the
experiences of workers affected by a small number of trade-related
layoffs. GAO examined (1) the extent to which workers accessed federally
funded reemployment services and the mix of services received, (2) the
employment outcomes these workers achieved, and (3) the extent to which
workers used the new health insurance and wage insurance benefits under
the Trade Adjustment Assistance (TAA) program, and the factors affecting
their participation.

What GAO Recommends

GAO recommends that the Secretary of Labor provide guidance to state and
local officials on how to ensure that potentially eligible workers are
made aware of the new health insurance and wage insurance benefits. In its
comments, Labor agreed with our findings and recommendations and noted
steps it was taking to implement them.
*** End of document. ***