United States Government Accountability Office

GAO Testimony Before the Committee on 

Veterans’ Affairs, United States Senate

VETERANS’

EMPLOYMENT AND 

TRAINING SERVICE 

Greater Accountability and 

Other Labor Actions 

Needed to Better Serve 

Veterans 

Statement of Sigurd R. Nilsen, Director 

Education, Workforce, and Income Security Issues 

For Release on Delivery

Expected at 10:00 a.m. EST 

Thursday, February 2, 2006 

 

GAO-06-357T 
Mr. Chairman: 

I am pleased to be here today to present the findings of our recent report 

on how the Department of Labor (Labor) and states have implemented 

some key provisions of the Jobs for Veterans Act (JVA).1

 Congress passed 

JVA in 2002 not only to improve employment and training services for 

unemployed veterans, but also to encourage employers to hire them. The

ability of veterans to quickly obtain quality service and employment has 

always been important, but will become even more so as the number of 

service members leaving active duty is likely to increase by 200,000 yearly,

according to Labor. 

The act introduced several reforms to two of Labor’s primary veterans’ 

employment assistance programs—the Disabled Veterans’ Outreach 

Program (DVOP) and the Local Veterans’ Employment Representative 

(LVER) program—administered by the Veterans’ Employment and 

Training Service (VETS). Under the act, DVOP staff are to focus on finding 

and serving veterans who need services to become job ready, including

case management services for developing job skills. LVER staff are to 

focus on developing relationships with employers to encourage them to 

hire veterans. In addition, the act called for DVOP and LVER staff to be 

integrated with other staff providing employment and training services 

within the one-stop delivery system established in 1998 under the 

Workforce Investment Act (WIA), and established an incentive program to 

reward staff for outstanding service to veterans. To determine how well 

these programs were working to assist veterans across states, the act also 

required Labor to establish a performance accountability system as well as 

a national minimum standard—or threshold—that states must meet for 

veterans’ employment. 

GAO previously testified on our preliminary observations on the status of 

implementation of these key provisions of JVA.2

 My testimony today will 

present the findings of our completed work related to the JVA reforms of

the DVOP and LVER programs. Specifically, I will address (1) action taken 

 1

GAO, Veterans’ Employment and Training Service: Labor Actions Needed to Improve 

Accountability and Help States Implement Reforms to Veterans’ Employment Services,

GAO-06-176 (Washington, D.C.: Dec. 30, 2005). 

2

GAO, Veterans’ Employment and Training Service: Preliminary Observations on 

Changes to Veterans’ Employment Programs, GAO-05-662T (Washington, D.C.: May 12,

2005). 

Page 1 GAO-06-357T 
to improve performance and accountability since the enactment of JVA in 

2002 and any associated challenges; (2) whether available data reflect that

such action has resulted in improved employment outcomes for veterans; 

and (3) factors affecting program oversight and accountability. 

In summary, our work shows that Labor and most states took action to 

implement JVA reforms for improving the DVOP and LVER programs 

within the first two years of the new legislation. However, our work also 

highlights several areas where Labor agencies should collaborate and take

additional action to enhance outcomes of these reforms, particularly in the 

area of improving state oversight and accountability. To this end, our 

December 2005 report recommended that Labor agencies work together to 

provide states and local areas with strategies to address the long-standing

challenge they have faced in integrating veterans’ staff into their service 

delivery system. For those states with an incentive award system, the wide 

variation in methodology for awarding incentives as well as the mixed 

opinions on the program’s success suggests that states could benefit from 

Labor presentation of methodologies that it considers successful and we 

recommended that Labor share these best practices. Finally, while states 

have appreciated the flexibility JVA provides them in serving veterans, 

such flexibility underscores the need for greater accountability to ensure 

that programs are on the right track in serving clients. However, 

accountability can be hindered and reforms implemented inconsistently 

when local level information is not always available, different Labor 

agencies do not coordinate their oversight efforts, and Labor does not use 

monitoring results to improve program performance. We therefore 

recommended that Labor strategically use monitoring results to target 

guidance and technical assistance to states and local areas most in need of

improved performance. Labor generally agreed with our 

recommendations. 

Our review was based on a survey of VETS directors as well as a survey of 

state workforce administrators in all 50 states and the District of 

Columbia. We also visited five states—California, Florida, Louisiana, Ohio, 

and Washington—where we interviewed VETS and state workforce 

officials, including local office managers and DVOP and LVER staff. In 

addition, we visited the National Veterans’ Training Institute in Denver, 

Colorado, where we interviewed training officials and veterans’ staff from 

24 states who were attending training classes. Finally, we held discussions 

with Labor agency officials and contacted various veterans’ service 

organizations and the National Association of State Workforce Agencies. 

Page 2 GAO-06-357T 
JVA amended Title 38 of the U.S. Code, the legislation that governs the 

DVOP and LVER programs, and by doing so, introduced an array of 

reforms to the way employment, training, and placement services are 

provided to veterans under the DVOP and LVER programs. (See table 1.)

The act also required increased veterans’ access to electronic services as 

well as to different types of Labor employment and training programs by 

requiring them to give veterans priority in receiving their services. In 

addition, it required federal contractors to advertise job openings at the 

appropriate employment service delivery system and report on their 

veteran hiring practices. 

Background 

Table 1: Comparison of Selected Provisions under Title 38 and JVA 

Title 38 Before JVA Amendments JVA 

Staff roles and responsibilities

• Prescribes 11 specific duties for DVOP staff and 13 for LVER

staff. 

• Only LVER staff may be assigned on a part-time basis. 

• Clearly distinguishes DVOP and LVER staff roles and gives

states flexibility in deciding their duties. 

• Allows both types of staff to be assigned on a part-time 

basis. 

Performance accountability 

• Performance measures emphasize processes over outcomes. 

• National standard not required. 

• Each local employment office evaluated annually. 

• Comprehensive performance accountability system 

consistent with WIA performance measures.

• National performance standard for the rate at which 

veterans enter employment, a rate that all states are 

expected to meet. 

• Annual performance reviews of veterans’ services without 

specifying how many local offices will be evaluated. 

Incentive awards 

• No incentive award program. • Incentive award program to encourage the improvement and 

modernization of veterans’ services and recognize 

exemplary staff. 

Source: GAO analysis of Title 38 and JVA legislation. 

Within Labor, VETS has primary responsibility for helping the nation’s 

veterans find employment. Among the programs that VETS administers are 

the DVOP and LVER programs, which were funded at about $162 million in 

fiscal year 2005. VETS administers the agency’s activities through 

representatives in each of Labor’s six regional offices and within each

state. The state directors are the link between VETS and each state’s 

employment service system that is overseen by the ETA. The DVOP and 

LVER staff, whose positions are funded by VETS, are part of the state’s 

public employment service system. 

Page 3 GAO-06-357T 
Employment services fall under the purview of ETA, which administers 

the Wagner-Peyser-funded Employment Services program within each

state, providing a national system of public employment services to any

individual seeking employment who is authorized to work in the United 

States. Like VETS, ETA carries out its employment service program 

through staff in Labor’s six regions and workforce agencies in each state.

In fiscal year 2005, ETA requested about $700 million for the WagnerPeyser program. 

The DVOP and LVER programs, along with the Employment Services 

program, are all mandatory partners in the one-stop center system created 

in 1998 by WIA and overseen by Labor, in which services provided by 

numerous employment and training programs are made available through

a single network. 

Labor and states have taken action to implement most JVA provisions to 

reform veterans’ services since the law was enacted in November 2002, but 

challenges remain particularly in implementing reforms to improve 

accountability for the DVOP and LVER programs. Labor issued guidance 

clarifying the new roles and responsibilities for veterans’ staff and 

allocated funding to states for an incentive program. Labor has also 

established performance measures aligned with state workforce systems 

under WIA as required by JVA. However, Labor reports that states will not 

be held accountable to a common national standard for veterans’ 

employment until 2007. (See table 2.) States also report good progress in 

implementing provisions, but challenges remain in some local areas in 

terms of integrating veterans’ staff with other employment services staff in 

local workforce centers. Many states also have not implemented an 

incentive program as provided in JVA for recognizing quality services to 

veterans. 

Labor and States 

Acted to Implement 

Program Reforms, but 

Accountability 

Challenges Remain 

Page 4 GAO-06-357T 
Table 2: Summary of Labor’s Completed and Planned Actions to Implement Selected JVA Provisions, as of December 2005 

Provision Labor’s completed actions Labor’s planned actions 

Prior to JVA 

Veterans’ staff roles and responsibilities • VETS issued first of several guidance letters in 

September 2002. National Veterans’ Training 

Institute subsequently began conducting training on 

JVA provisions for veterans’ staff in 2003. 

• Updates will occur as 

necessary. 

JVA enacted November 7, 2002 

First full program year following JVAa

Performance accountability • VETS issued a guidance letter establishing new 

performance measures in June 2003, followed by 

guidance in May 2004 on negotiating performance 

measures with states. 

• Labor anticipates that it 

will be 2007 before it can 

establish a national 

standard that states must 

meet for veterans entering 

employment. 

First full fiscal year following JVAb

Incentive awards • VETS allocated incentive award funds to states 

beginning in fiscal year 2004.

• None. 

Source: GAO analysis of JVA provisions and Labor information. 

a

Program year 2003 was the first full program year under JVA and ran from July 1, 2003, to June 30, 

2004. 

b

Fiscal year 2004 was the first full fiscal year under JVA and ran from October 1, 2003, to September 

30, 2004. 

Staff Roles and 

Responsibilities 

VETS took several steps to prepare veterans’ staff for their new roles and 

responsibilities under the law, and while the majority of state workforce 

administrators reported that these staff had transitioned to a greater focus 

on intensive services for veterans and employer outreach as required by 

JVA, challenges remained in the areas of training and integrating staff in 

some one-stop offices. VETS began issuing guidance to transition staff to 

their new roles in 2002, and a training program soon followed in 2003. 

Both Labor’s formal written guidance and technical assistance was wellreceived, with almost three-quarters of the 50 state workforce officials 

reporting on our survey that the quality was good or excellent in 

facilitating implementation of new staff duties. 

VETS officials cited challenges, however, in meeting all training needs for 

veterans’ staff informing them of their new roles and responsibilities under 

the act. While Labor’s training institute continues to conduct and fund 

training, it estimated that the current funding would cover training for only 

about 16 percent of all veterans’ staff each year, while annual staff 

turnover was averaging about 18 percent. In terms of staff integration, 

Labor officials said that integrating staff into the one-stop offices has been

Page 5 GAO-06-357T 
a persistent challenge and the DVOP and LVER staff we interviewed cited 

a wide variation of integration in local areas. Reasons these staff cited for

poor integration included a lack of support by the local office manager, the 

lack of education and training for other one-stop staff members on serving 

veterans, and only fair to poor quality of Labor’s guidance and technical 

assistance to states in how to integrate veterans’ staff into the local onestop offices. 

VETS issued guidance in time to establish an incentive program in the first 

fiscal year after JVA, and 32 of the 50 state workforce administrators we 

surveyed reported implementing the program. State workforce officials in 

17 states that did not implement the program cited various reasons. 

California, for example, cited that state law prohibited monetary or other 

gifts to employees for performing their duties. Idaho cited potential morale 

problems among one-stop staff that have limited opportunities to serve 

veterans. Four other states cited that the awards were incompatible with 

the states’ collective bargaining agreements. VETS officials said that some 

states had been more successful than others in designing their awards 

system and state opinions were mixed on the extent that the incentive

programs resulted in improved services. Administrators in 16 states with 

award programs in place reported that their program had a positive effect 

on improving or modernizing veterans’ services. On the other hand, 

administrators in 15 other states either said that their incentive program 

had no effect (7 states) or that it was too early to say (8 states). 

Incentive Awards Program 

Performance 

Accountability 

Labor has taken action to establish a new accountability system as 

required by JVA, but reports that more time is needed under the new 

system before it can hold all states accountable to the same standard for 

veterans’ employment. As required by the act, Labor established some new 

performance measures for the DVOP and LVER grant programs in 2003 

consistent with state performance measures under WIA. VETS officials 

told us they made additional modifications to the performance 

accountability system when they adopted the Office of Management and 

Budget’s new common performance measures in July 2005. As these new 

systems were put in place, VETS officials said they also changed the 

method they use to calculate the entered employment measure and collect 

source data. However, VETS anticipates it will need at least 3 years under 

these measures—until 2007—to collect comparable trend data needed to 

establish the national performance standard holding all states accountable 

to the same minimum goal for the rate veterans enter employment. 

Page 6 GAO-06-357T 
While data are not available to link the JVA reforms to changes in veterans’ 

services and employment outcomes, most state workforce administrators 

we surveyed believed that the reforms have improved the quality of 

services to veterans, and have improved their employment outcomes. 

Overall, 33 of the 50 state workforce administrators reported that veterans’

employment services have improved in their respective states since the 

law’s enactment. Among six different services we asked about, 

administrators most often reported that DVOP staff were spending more 

time on case management since JVA, although somewhat fewer states 

reported that services to disabled veterans had similarly improved. (See

fig. 1.) 

State Officials 

Reported that JVA 

Reforms Improved 

Veterans’ Services and 

Employment 

Outcomes 

Figure 1: Improvements in Services to Veterans since JVA Was Enacted

0 10 20 30 40 50

DVOP staff are spending more

time on case management 

Quality of case management and other

 intensive services has improved

Electronic access to services for veterans

 through the Internet has increased

LVER staff are spending more

time on outreach to employers

Veterans receive greater 

priority of referral to jobs

Services provided to disabled 

veterans have improved 

Number of states

Source: Responses to GAO survey by 50 state workforce administrators.

Workforce administrators in 33 states also reported improvement in 

veterans’ employment results. These respondents attributed the 

improvement both to the law’s reforms and to other factors. The reform 

cited most often as helping veterans obtain employment was the increased

availability of case management or other intensive services through the 

DVOP program. Other than the reforms themselves, administrators said 

veterans’ employment was influenced by employer willingness or desire to 

hire veterans and by the strength of the local job market. (See fig. 2.) 

Page 7 GAO-06-357T 
Figure 2: Factors That Assisted Veterans in Obtaining Employment 

0 10 20 30 40 50

Robust job market in local area

More employers listing available jobs

 at local one-stops or local offices

Veterans’ existing job skills were 

transferable to other jobs

Veterans’ skills matched credentials needed

for available positions

Greater willingness or desire to hire veterans

Priority of referral for federal contractor jobs

Priority of service in Labor training programs

Outreach to new employers by LVER staff 

Increase in availability of case management or 

other intensive services by DVOP staff 

Number of states

JVA reforms

Other factors

Source: Responses to GAO survey by 50 state workforce administrators.

In terms of barriers to employment, state administrators reported that 

federal contractor failure to list job openings at the local one-stop centers 

was a factor under most likely to delay or prevent some employment. 

Other factors also presented obstacles to employment, the most frequent 

one being a poor local job market. This factor was cited nearly twice more 

often as other factors, such as non-transferability of skills or employer 

reluctance to hire veterans with National Guard or Reserve commitments. 

(See fig. 3.) 

Page 8 GAO-06-357T 
Figure 3: Factors That Delayed or Prevented Veterans from Obtaining Employment 

0 2 4 6 8 10 12

Employers not listing available jobs

at local offices or one-stops

Veterans’ skills did not match credentials

needed for available positions

Reluctance of employers to hire veterans with 

possible National Guard and Reserve commitments

Veterans’ skills were not 

transferable to available jobs

Poor job market in local area 

Veterans not receiving priority 

of referral for federal contractor jobs

Waiting list for Labor training programs

Federal contractors not listing

available jobs at local offices or one-stops

Number of states

Other factors

JVA reforms

Source: Responses to GAO survey from 50 state workforce administrators.

Labor oversight and accountability for the DVOP and LVER programs has 

been affected by the lack of data available from local workforce offices in

some states, as well as the lack of coordination among Labor agencies in

monitoring and sharing information gathered on program performance. 

While state VETS directors responding to our survey most often reported

that their monitoring role under JVA has had a positive effect on local 

accountability, 19 directors reported their monitoring role either had no 

effect or a negative effect. Our survey showed two main reasons for the 

lack of a stronger effect.

Program 

Accountability 

Weakened by Absence 

of Local Data and 

Lack of Coordinated 

Oversight 

Page 9 GAO-06-357T 
Lack of Local Level Data. In our survey, state VETS directors reported 

that performance data from local offices are not available in many states, 

limiting federal oversight and weakening local level accountability. State 

VETS directors reported in our survey that among four different tools used 

to monitor local office performance, the most beneficial were analysis and 

use of data captured in states’ performance reports, along with on-site 

reviews of local offices. Under JVA, states took on greater responsibility 

for assessing their own performance, and VETS modified its monitoring 

practices in response by extending the time between site visits to local 

offices from 1 year to 5 years. VETS directors in 21 states, however, noted

that data were not available to monitor performance of local offices, and 

in these states, federal oversight may be limited to the on-site monitoring 

visits by VETS directors required once every 5 years. 

Lack of Coordinated Oversight. While Labor agencies are jointly 

responsible for monitoring employment and training services, little or no 

effort has been made to coordinate oversight or use the monitoring results 

to target assistance to states and localities that are most in need. For 

example, while VETS is responsible for monitoring performance of the 

DVOP and LVER programs, ETA oversees other workforce programs that 

serve veterans as well as nonveterans, such as WIA and Wagner-Peyser 

Employment Services. However, the two agencies do not generally 

coordinate their monitoring activities or share the results. Only five state 

VETS directors reported that they met with ETA officials to share 

monitoring results and take joint action to address problems. 

Labor also lacks a strategy for using the monitoring information it gathers 

to improve performance across states and local areas. While Labor has 

authority under JVA to provide technical assistance to states that are 

deficient in performance or need help, VETS has yet to begin addressing 

the significant variation in performance levels among states, as reflected 

by their widely divergent performance goals. For example, in program 

years 2004 and 2005, states’ negotiated goals for the rate at which veterans 

entered employment ranged from 38 to 65 percent, while Labor’s national

employment goal for veterans was 58 percent.3

 Although more than half of

the state goals fell short of Labor’s national target, VETS has not been 

proactive in determining why certain states are falling behind and in 

targeting them for assistance. 

 3

Labor’s national goal applies to all programs that serve veterans and is distinct from the

JVA requirement to set a national minimum standard for the DVOP and LVER programs. 

Page 10 GAO-06-357T 
Our report recommended that the Secretary of Labor provide clear 

guidance to integrate veterans’ staff into the one-stops and foster state use 

of incentives. We also recommended that Labor’s program offices 

coordinate their oversight of JVA provisions, and that Labor use 

monitoring results to develop program improvements. Labor agreed with 

our recommendations. 

Mr. Chairman, this completes my prepared statement. I would be happy to

respond to any questions you or other Members of the Committee may 

have at this time. 

For further information regarding this testimony, please contact me at 

(202) 512-7215. Lacinda Ayers, Meeta Engle, and Stan Stenersen were key 

contributors to this testimony. 

Recommendations 

Contact and 

Acknowledgments 

Page 11 GAO-06-357T 
Page 12 GAO-06-357T 

Related GAO Products 

Veterans’ Employment and Training Service: Labor Actions Needed to

Improve Accountability and Help States Implement Reforms to Veterans’

Employment Services. GAO-06-176. Washington, D.C.: December 30, 2005. 

Unemployment Insurance: Better Data Needed to Assess Reemployment 

Services to Claimants. GAO-05-413. Washington, D.C.: June 24, 2005. 

Veterans’ Employment and Training Service: Preliminary Observations 

on Changes to Veterans’ Employment Programs. GAO-05-662T. 

Washington, D.C.: May 12, 2005. 

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. 

Veterans’ Employment and Training Service: Flexibility and 

Accountability Needed to Improve Service to Veterans. GAO-01-928. 

Washington, D.C.: September 12, 2001. 

Veterans’ Employment and Training Service: Proposed Performance 

Measurement System Improved, but Further Changes Needed. 

GAO-01-580. Washington, D.C.: May 15, 2001. 

Veterans’ Employment and Training Service: Strategic and Performance 

Plans Lack Vision and Clarity. GAO/T-HEHS-99-177. Washington, D.C.: 

July 29, 1999.

Veterans’ Employment and Training Service: Assessment of the Fiscal

Year 1999 Performance Plan. GAO/HEHS-98-240R. Washington, D.C.: 

September 30, 1998. 

Veterans’ Employment and Training: Services Provided by Labor 

Department Programs. GAO/HEHS-98-7. Washington, D.C.: 

October 17, 1997. 

(130550) 
This is a work of the U.S. government and is not subject to copyright protection in the 

United States. It may be reproduced and distributed in its entirety without further 

permission from GAO. However, because this work may contain copyrighted images or 

other material, permission from the copyright holder may be necessary if you wish to 

reproduce this material separately. 
GAO’s Mission The Government Accountability Office, the audit, evaluation and 

investigative arm of Congress, exists to support Congress in meeting its 

constitutional responsibilities and to help improve the performance and 

accountability of the federal government for the American people. GAO 

examines the use of public funds; evaluates federal programs and policies; 

and provides analyses, recommendations, and other assistance to help

Congress make informed oversight, policy, and funding decisions. GAO’s 

commitment to good government is reflected in its core values of 

accountability, integrity, and reliability. 

The fastest and easiest way to obtain copies of GAO documents at no cost

is through GAO’s Web site (www.gao.gov). Each weekday, GAO posts 

newly released reports, testimony, and correspondence on its Web site. To

have GAO e-mail you a list of newly posted products every afternoon, go 

to www.gao.gov and select “Subscribe to Updates.” 

The first copy of each printed report is free. Additional copies are $2 each. 

A check or money order should be made out to the Superintendent of 

Documents. GAO also accepts VISA and Mastercard. Orders for 100 or 

more copies mailed to a single address are discounted 25 percent. Orders 

should be sent to: 

U.S. Government Accountability Office 

441 G Street NW, Room LM 

Washington, D.C. 20548 

To order by Phone: Voice: (202) 512-6000 

TDD: (202) 512-2537 

Fax: (202) 512-6061 

Contact: 

Web site: www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470 

Gloria Jarmon, Managing Director, JarmonG@gao.gov (202) 512-4400 

U.S. Government Accountability Office, 441 G Street NW, Room 7125 

Washington, D.C. 20548 

Paul Anderson, Managing Director, AndersonP1@gao.gov (202) 512-4800

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, D.C. 20548 

Obtaining Copies of 

GAO Reports and 

Testimony

Order by Mail or Phone 

To Report Fraud,

Waste, and Abuse in 

Federal Programs 

Congressional 

Relations 

Public Affairs 

PRINTED ON RECYCLED PAPER