BACKGROUND PAPER 

CETA Reauthorization Issues 

August 1978 

O Congress of the United States 

Congressional Budget Office 

CETA REAUTHORIZATION ISSUES 

The Congress of the Un~ted States 

Congressional Budget Office 

For sale by the Superintendent 01 Documents, U.S. Government Printing Office 

Washington, D.C. 20012 

PREFACE 

On September 30, 1978, the authorization for Comprehensive 

Employment and Training Act (CETA) programs expires. This paper 

analyzes current CETA programs and the changes that would result 

under reauthorization bills proposed by the Administration, the 

Senate Human Resources Committee, and the House Education and 

Labor Committee. The paper was prepared in response to requests 

from the Senate· and House Committees on the Budget; the Senate 

Human Resources Committee; and the Employment Opportunities 

Subcommittee of the House Education and Labor Committee. 

The paper was written by Charles L. Betsey of the Congressional Budget Office's Human Resources and Community Development 

division, under the supervision of Robert D. Reischauer and David 

S. Mundel. John Sheils provided essential computer assistance. 

Valuable advice was provided by other CBO staff, especially Steve 

Chadima, Richard A. Hobbie, George Iden, Cyrus Karr, Sophie 

Korczyk, and Charles Seagrave. 

In addition, helpful comments were provided at various 

stages of the project by a large number of individuals, including 

Anthony Carnevale, Carole Cox, Robert Fulton, Susan Grayson, Joan 

Hunziker, George Johnson, Steve Juntila, James O'Connell, John 

Palmer, Isabel Sawhill, Darla Schecter, Peggy Taylor, and Alair 

Townsend. 

The paper was edited by Mary Richardson Boo under the 

supervision of Robert L. Faherty. Norma Leake and Toni Wright 

provided excellent secretarial assistance throughout the typing 

of the various drafts of this paper and prepared the manuscript 

for publication. 

In accordance with the CBO's mandate to provide objective 

and impartial analysis, this paper contains no recommendations. 

August 1978 

Alice M. Rivlin 

Director 

iii 

CONTENTS 

Preface .............................................. 

Summary .............................................. Chapter I. Introduction ............................. Chapter II. CETA Program Activities and 

Their Impacts ••.••.•.••••••••.••.•••••••• 

CETA Activities •••••••••••••••••••••••••••••••••• 

The Impact of CETA .............................. Chapter III. Effect of Alternative Activity 

Restrictions and Funding Triggers ...... The Impact of Restrictions on Activity Mix •••••• 

Relative Size of the PSE Program •••••••••••••••• 

Chapter IV. Targeting CETA Services on Those 

in Need ••••••••••.••.••.•.•••.•.•..•.••. 

Eligibles under Current CETA Definitions ........ Impact of Changes in the Definition of 

Economically Disadvantaged •••••••••••••••••••• 

Enforcing Eligibility Requirements •••••••••••••• 

Chapter V. Targeting CETA Services on 

Geographic Areas ••••••••••••••••••••••••• 

Defining Geographic Areas ••••••••••••••••••••••• 

Impact of Current Geographic Eligibility 

Criteria •••••••••••••••••••••••••••••••••••••• 

Current Geographic Allocation Formulas •••••••••• 

Alternative Allocation Formulas ••••••••••••••••• 

Chapter VI. Coordination and Integration of the 

Delivery of Employment and Training 

Services ..•..•.••.•..•...••.....•..•.... 

v 

iii 

xiv 

1 

3 

3 

13 

24 

24 

25 

32 

33 

43 

53 

55 

55 

56 

60 

62 

61 
CONTENTS (continued) 

CETA/Employment Service Coordination 

Role of Community-Based Organizations 

Coordination of CETA with Welfare 

............ 

........... Reform ........................................ Private Sector Delivery of CETA Services ........ Appendix .•••••••••••••••••••••••••••••••••••••••••••• 

vi 

68 

69 

70 

72 

77 
TABLES 

1. CETA Program Expenditures, by Activity, Fiscal 

Years 1975-1978: In Millions of Dollars and 

Percent Distribution .......................... 2. Public Service Employment Expenditures and Job 

Slots, Fiscal Years 1975-1978: In Millions 

5 

of Dollars •••••••••••••••••••••••••••••••••••• 8 . 

3. CETA Program Expenditures for Special Client 

Groups, by Activity, Fiscal Years 1977 and 

1978: In Millions of Dollars ••••••••••••••••• 12 

4. Participant Terminations From CETA Title I, II, 

and VI Programs, Fiscal Years 1976 and 1977: 

Percent Distribution •••••••••••••••••••••••••• 21 

5. Estimated Obligations and Slots for Title VI 

Public Service Employment under Administration 

and Senate and House Committee Bills •••••••••• 28 

6. Pattern of Public Service Employment Funding 

under H.R. 11086 Title VI During a 

Hypothetical Recession: Recovery Cycle ....... 

7. Characteristics of Title I Eligib les and 

Participants: Percent Distribution, 1975 

8. Characteristics of Title VI Eligibles and 

Participants: Percent Distribution, 1975 

9. Characteristics of Migrant and Seasonal 

Farmworker Program Eligibles: Numbers and 

..... 

30 

35 

37 

Percent Distribution, 1975 •••••••••••••••••••• 39 

10. Characteristics of Summer Youth Program 

Eligibles and Participants: Percent 

Distribution, 1975 •••••••••••••••••••••••••••• 40 

vii 
TABLES (continued) 

11. Eligibles for Current Youth Programs: 

Percent Distribution, 1975 •••••••••••••••••••• 

12. Family Incomes of Youth Program Eligibles 

under Current Law: Percent Distribution, 

1975 •••••••••••••••••••••••••••••••••••••••••• 

13. Effects of Proposed Change in Dependency 

Definition on Current Title VI Eligibles: 

Percent Distribution .......................... 14. Effects of Proposed EHgibility Changes on 

Current Title I Eligibles: Percent 

42 

44 

45 

Distribution •••••••••••••••••••••••••••••••••• 48 

15. Characteristics of Title VI Eligibles under 

Current Law, Administration, and Senate and 

House Committee Proposals: Percent 

Distribution •••••...•••. .•••••••• ••••.•••• .•. • 50 

16. Family Incomes of Title VI Eligibles under 

Current Law, Administration, and Senate and 

House Proposals: Percent Distribution •••••••• 52 

17. Economic Stimulus Appropriations to 48 Cities 

by Degree of Fiscal Distress, Fiscal Year 

1978 •••••••••••••••••••••••••••••••••••••••••• 57 

18. Areas Eligible for CETA Funds under Current and 

Proposed ASU Definitions, Fiscal Year 1979 •••• 59 

19. CETA Allocation by Formula Elements and 

Amounts: In Millions of Dollars and 

Percent Distribution, Fiscal Years 1977-

1978 Appropriations ••••••••••••••••••••••••••• 61 

20. CETA Title II and VI Allocation Formula Elements 

and Weights under Administration, and Senate 

and House Committee Bills ••••••••••••••••••••• 

viii 

63 
TABLES (continued) 

21. Illustrative Allocations of $1 Billion in 

Structural PSE Funds under Administration, 

and Senate and House Committee Bills: Amounts 

in Millions of Dollars and Percent 

Distribution .................................. 22. Illustrative Allocations of $1 Billion to 

Various Prime Sponsors under Structural 

PSE Programs: Amounts in Thousands of 

65 

Dollars and Percent Distribution •••••••••••••• 66 

ix 

APPENDIX TABLES 

A-1. 

A-2. 

A-3. 

A-4. 

A-5. 

A-6. 

Summary of Selected Employment and Training 

Program Data, Fiscal Year 1977 •••••••••••••• 

Selected Employment and Training Program 

Costs Per Year of Service in Fiscal Year 

1977: In Dollars ••••.••••••••...••••••••••• 

Selected Employment and Training Program 

Costs Per Participant in Fiscal Year 

1977: In Dollars ••••••••••••••••••••••••••• 

Selected Employment and Training Program 

Outlays in Fiscal Year 1977: In Millions 

of Dollars •••••••••••••••••••••••••••••••••• 

Selected Employment and Training Program 

Years of Service in Fiscal Year 1977 ........ 

CETA, Title I: Fiscal Year 1977 .............. A-7. CETA, Title III--Migrant and Seasonal 

78 

79 

80 

81 

82 

83 

Farm Workers: Fiscal Year 1977 ••••••••••••• 84 

A-8. CETA, Title III--Native Americans: 

Fiscal Year 1977 •••••••••••••••••••••••••••• 85 

A-9. CETA, Title III--Summer Youth Program: 

Fiscal Year 1977 •••••••••••••••••••••••••••• 86 

A-10. CETA, Title IV--Job Corps: Fiscal Year 

1977 •••••••••••••••••••••••••••••••••••••••• 87 

A-I1. CETA, Titles VI and II: Fiscal Year 1977 ..... 88 

A-12. Community Service Employment for Older 

Americans: Fiscal Year 1977 •••••••••••••••• 89 

A-13. Work Incentive Program: Fiscal Year 1977 90 

xi 

SUMMARY 

The Congress is currently considering legislation to reauthorize the Comprehensive Employment and Training Act (CETA), 

which expires at the end of fiscal year 1978. Among the important issues involved in this reauthorization process are: 

o Which CETA activities have been most effective and how 

can they be encouraged? 

o How can CETA programs be concentrated on those most in 

need of services? 

o How can CETA activities be better coordinated with other 

employment and training services? 

WHICH CETA ACTIVITIES HAVE BEEN MOST EFFECTIVE 

AND HOW CAN THEY BE ENCOURAGED? 

CETA is a diverse program. Its activities include public service employment (PSE), work experience, institutional 

training, on-the-job training (OJT), and programs for special 

population groups such as migrants, older workers, and youth. 

The purposes of CETA are also diverse--to increase participants' 

employment, current and future earnings, and employability. Some 

CETA programs and activities are primarily structural, designed 

to remedy discrepancies between participants' skills and job 

requirements; others are primarily countercyclical, intended to 

phase out as aggregate unemployment declines. CETA has public 

service employment programs of both types. 

Because CETA is a relatively new program, little information 

is available on its impact, but there are numerous evaluations of 

earlier employment and training programs that supported similar 

activities. Assessments of these pre-CETA programs indicate that 

highly structured training programs serving disadvantaged clientele have had the highest' measured impacts on post-program employment and earnings. Even these impacts have been relatively 

small, however, with average annual earnings gains of $400 to 

$800 lasting up to 18 months and dissipating thereafter. Work 

experience programs have had little measurable impact on the 

xiii 
subsequent employment success of participants. The effects of 

public service employment are much more uncertain. The net job 

creation potential of public service employment has been widely 

disputed since the inception of the Public Employment Program 

(PEP), a CETA predecessor authorized by the Emergency Employment 

Act of 1971. Recent estimates of fiscal substitution--the share 

of PSE funding that simply replaces state and local monies that 

would have been spent anyway--range from 18 to 100 percent. The 

long-term structural effects of PSE on participants' earnings and 

employment are also uncertain. 

The Congress is considering several methods for encouraging 

the provision of more effective CETA services while maintaining a 

decentralized delivery system. The Administration and the House 

Education and Labor Committee have proposed establishing limits 

on the funding of structural public service employment programs. 

Under both proposals no more than 50 percent of funds expended 

under the general, structurally oriented employment and training 

program--Title II--could be used for PSE and work experience 

activities. This 50 percent limit, however, would result in 

little change in current funding patterns in these programs. The 

CETA bill reported out by the Senate Human Resources Committee 

would not restrict the pattern of funding among structurally 

oriented employment and training activities. 

The level of funding for Title VI (countercyclical) PSE 

would be restricted under all three of the proposed bills: 

o The Senate committee bill would require that structural 

PSE programs be funded at $3 billion as a condition 

for funding countercyclical PSE. Since the Senate 

bill would authorize "such sums as are necessary" to fund 

Title VI jobs, it would afford flexibility in building up 

the number of PSE jobs and would allow funding to adjust 

to changes in the average cost of PSE jobs and the size 

of the labor force. It would make phasing down PSE more 

difficult. 

o The House committee bill would require Title VI PSE 

funding to provide jobs for 25 percent of the unemployed 

in excess of 4 percent of the labor force. This formula 

would result in gradual changes in the level of PSE funds 

as the unemployment rate changed. The number of PSE jobs 

would not be eroded by changes in the cost of PSE jobs or 

by the size of the labor force. 

xiv 
o The Administration bill would require that funds for 

countercyclical PSE be obligated on the basis of changes 

in the unemployment rate, above 4.75 percent. Changes 

in the required funding would be relatively abrupt. 

Since the bill specifies dollar amounts of obligations, 

the number of PSE jobs under the Administration bill 

would be eroded by changes in the average cost of jobs, 

as well as by increases in the size of the labor force. 

HOW CAN CETA PROGRAMS BE CONCENTRATED 

ON THOSE MOST IN NEED OF SERVICES? 

Employment problems remain concentrated in segments of 

the labor force. The economy has experienced a recovery from 

the depths of the recent recession, but, while the national 

unemployment rate in June 1978 was 5.7 percent, the rates for 

blacks and other nonwhites, youth, and adult women were much 

higher. Less educated and lower income workers are also experiencing greater employment difficulties than the general 

population. 

Funding constraints limit participation in CETA programs 

to only a small share of those eligible for services. If broad 

eligibility rules make large numbers of individuals eligible 

for a limited number of employment or training slots, program 

operators may "Skim," choosing those eligibles who are easiest to 

serve rather than those most in need of service. The eligibility 

rules proposed in all three CETA bills are likely to reduce the 

size of the population eligible for Title II programs and more 

effectively limit participation to the most disadvantaged. All 

three bills would require that eligibles be both economically 

disadvantaged (with family incomes no higher than $7,000 indexed 

by family size, region, and metropolitan residence; or whose 

families receive cash assistance benefits) and either unemployed, underemployed, or in school. Under these proposed 

eligibility rules, larger proportions of eligibles would be 

recipients of Aid to Families with· Dependent Children (AFDC) 

benefits, nonwhites, females, and members of low-income families 

than under current Title I eligibility requirements (see Summary 

Table). While the scope for skimming can be reduced by limiting 

the size of the eligible population, skimming cannot be completely eliminated. 

xv 
SUMMARY TABLE. CHARACTERISTICS OF CETA ELIGIBLES UNDER CURRENT LAW 

AND UNDER THE ADMINISTRATION, AND SENATE AND HOUSE 

COMMITTEE PROPOSALS: PERCENT DISTRIBUTION AND TOTALS 

IN MILLIONS 

Senate House 

Current Human Education 

Program/Eligibles Law Resources and Labor Administration 

CETA Title 1/11 ~/ 

Total (millions) 35.0 6.4 6.4 6.4 

Nonwhite 24.7 34.1 34.1 34.1 

Female 58.4 59.4 59.4 59.4 

AFDC 16.2 30.8 30.8 30.8 

Less than high 

school graduate 58.4 56.0 56.0 56.0 

With family 

income below $7,500 76.1 99.6 99.6 99.6 

CETA Title VI 

Total (millions) 6.0 Jl./ 1.8 1.8 1.6 

Nonwhite 43.1 36.6 35.1 38.9 

Female 70.5 45.4 44.7 44.9 

AFDC 88.2 24.6 22.1 30.8 

Less than high 

school graduate 58.7 53.3 52.0 54.7 

With family 

income below $7,500 83.6 87.2 82.4 93.9 

SOURCE: Congressional Budget Office tabulations of the 1976 Survey of 

Income and Education. Statistics are for those eligible 

during March 1976. 

~/ Current Title I programs would be carried out under Title II of 

the proposed bills. 

k/ Current law Title VI(b) under the 1976 amendments. 

xvi 
The eligible group for Title VI PSE jobs would be substantially reduced, compared with cut rent Title VI (b) , under the 

Administration and Congressional committee CETA bills. At the 

same time, all of the proposed bills would, in general, result in 

targeting the PSE program on a less disadvantaged clientele than 

was accomplished by the Title VI amendments of 1976. Targeting, 

however, would continue to be better than it was in the pre-1976 

PSE program. 

HOW CAN CETA ACTIVITIES BE BETTER COORDINATED 

WITH OTHER EMPLOYMENT AND TRAINING SERVICES? 

CETA is the major but not the only provider of federal 

employment and training services. Services provided through 

the Work Incentive (WIN) program, Community-Based Organizations, 

the Employment Service, and some private employers overlap and 

perhaps duplicate those provided by CETA. Better coordination of 

activities might result in better service for participants and 

reduced overall budget costs. Proposed welfare reform legislation--such as the Administration proposal (H.R. 9030), the House 

Welfare Reform Subcommittee bill (R. R. 10950) , or the BakerBellmon proposal (S. 2777)--would require a better coordinated 

program than currently exists. 

Neither the current CETA law nor any of the proposed alternatives clearly delineate the relative responsibilities of CETA 

prime sponsors and other agencies such as the Employment Service. 

In the absence of clearer definitions of agency roles, programs 

of job search and relocation assistance proposed in the various 

bills would cause further uncertainty and duplication of effort. 

Better and more extensive coordination would also be required if any of the major welfare reform proposals introduced 

in the 95th Congress were enacted. These proposals would prOVide 

public service jobs and training to program eligibles. Differences in eligibility rules, allowable wage rates, and specified 

length of program participation in PSE under CETA and welfare 

would be the cause of considerable confusion. 

All of the CETA reauthorization bills would establish under 

Title VII a program designed to increase the participation of 

private sector employers in providing employment and training 

services to CETA participants; the intended result would be the 

increased placement of CETA workers and trainees in unsubsidized 

xvii 

31.937 0 - 78 • 2 
jobs. Since private sector involvement in such activities is 

likely to vary directly with the overall level of economic 

activity, government training and employment activities might be 

planned to vary inversely with private sector involvement. 

xviii 
CHAPTER I. INTRODUCTION 

The Comprehensive Employment and Training Act (CETA) of 

1973, which consolidated many then-existing manpower programs, 

was enacted "to provide job training and employment opportunities 

for economically disadvantaged, unemployed, and underemployed 

persons." Jj Most CETA funds are distributed to 450 prime 

sponsors--usually general-purpose local governments--that directly provide or contract for classroom and on-the-job training, 

work experience, public service employment, and other labormarket services in order to provide CETA participants employment 

and training in the short run and to increase their employability 

in the long run. 

CETA expires at the end of fiscal year 1978, and several 

important questions about the future shape of its employment and 

training system have arisen in the reauthorization debate. These 

include: 

o Which of the various CETA activities--training, work 

experience, public service employment, and labor-market 

information--have been most effective and hence should be 

emphasized in the future? 

o To what extent should CETA be targeted on those who are 

most severely disadvantaged in the labor market: racial 

and ethnic minorities, youth, and the poorly educated? 

How sensitive is targeting to changes in program eligibility rules? 

o To what extent should CETA funds be concentrated on geographic areas with high levels of labor-market problems? 

o How can the delivery of employment and training services 

by CETA prime sponsors be improved and coordinated with 

those of the Employment Service, the Work Incentive (WIN) 

program, private ~mployers, and other agencies and 

programs providing services that overlap with those of 

CETA? 

11 P.L. 93-203, Section 2. 

1 
These issues are discussed in the following chapters of 

this paper. Chapter II reviews the activities and effects of the 

major CETA employment and training programs. Because CETA 

is relatively new and very little is known about its impact, 

judgments about the effectiveness of its programs are based 

largely on extrapolations of the results of earlier similar 

programs, such as the Manpower Development and Training Act, 

the Economic Opportunity Act, the Emergency Employment Act, and 

others. 

The impact of proposed changes in the level and mix of CETA 

activities is evaluated in Chapter III. Chapter IV explores the 

issue of targeting: Do CETA services reach those in need? It 

also examines how the current and proposed definitions of eligibility affect the size and characteristics of the eligible 

population. Chapter V describes the criteria used to target CETA 

program funds on needy geographic areas and discusses the implications of alternative definitions. Chapter VI discusses the 

CETA delivery system and its coordination and overlap with other 

providers of employment and training services, as well as various 

alternative delivery approaches. 

Throughout the paper, the provisions of the current law, the 

Administration's CETA reauthorization proposal (H.R. 11086), the 

Senate Human Resources Committee bill (S. 2570), and the House 

Education and Labor Committee bill (H.R. 12452) are compared with 

one another for illustrative purposes. 

2 
CHAPTER II. CETA PROGRAM ACTIVITIES AND THEIR IMPACTS 

Since the enactment of CETA in 1973, funding for the program 

has grown from $1.5 billion (31 percent of the federal employment 

and training effort) to $9.6 billion (73 percent of the fiscal 

year 1978 federal employment and training budget). This chapter 

describes the activities funded under CETA and reviews what is 

known about their impact. 

CETA ACTIVITIES 

CETA activities are similar in many ways to earlier programs 

administered by the Department of Labor (DOL) and the Office 

of Economic Opportunity (OEO). On-the-job and institutional 

training, public service employment, work experience, and other 

labor-market service activities have continued under CETA, though 

their relative emphasis has changed. CETA was to have been a 

major step towards decategorization of the federal manpower effort (that is, individual eligibility would not be determined 

on the basis of whether one fit a certain category--for example, 

AFDC recipient) • Several categorical programs, however, including the Job Corps, migrant and seasonal farmworker programs, 

Native American programs, and a number of youth programs, were 

transferred to CETA with little alteration. 

The various programs authorized by CETA are: 

Title I provides job opportunities, training, education, 

and other services intended to enable participants to secure and retain employment. 

Title II provides transitional public service employment 

in jobs providing needed public services in 

areas of substantial unemployment. 

Title III -- provides services such as those in Titles I 

and II to population groups in particular 

need, such as youth, migrant and seasonal 

farmworkers, and Native Americans. 

3 
Ti tle IV -- provides residential and nonresidential programs of education, vocational training, and 

other act ivi ties through the Job Corp s. 

Title V -- establishes the National Commission for Manpower Policy, which studies employment issues 

and makes periodic reports to the Congress. 

Title VI -- provides transitional employment for unemployed, underemployed, and low-income persons. 

Title VII -- establishes Young Adult Conservation Corps 

to provide youth with employment and other 

benefits while they engage in conservation 

work on public lands and waters. 

Training 

Institutional Training. During fiscal year 1977, about 22 

percent of all CETA funds were devoted to training (see Table 1). 

CETA provides institutional (classroom) and on-the-job training 

(OJT) activities to increase the skills and productivity of its 

participants. Training is provided directly by prime sponsors 

and through contracts with both private and nonprofit organizations. Most CETA skill training has been carried out under the 

authority of Title I. Since the enactment of CETA, however, 

there has been a gradual shift in emphasis away from training, 

particularly institutional training, toward other activities, 

notably public service employment. 

Institutional training is also provided by the Job Corps, 

which was originally established under Title I-A of the Economic 

Opportunity Act (EOA) of 1964. With the passage of CETA in 1973, 

Job Corps authority was shifted to Title IV of CETA. The Job 

Corps is aimed at low-income and disadvantaged youth aged 14 

to 22. During fiscal year 1978, approximately 58,000 youths are 

expected to participate, at a cost of $274 million. The cost 

per participant is expected to be $6,200. Job Corps training 

takes place in centers located in several states and Puerto Rico. 

Job Corps centers are administered directly by DOL and, under 

contract, by private industry and other government agencies. 

There are three types of centers: 

4 
TABLE 1. CETA PROGRAM EXPENDITURES, BY ACTIVITY, FISCAL YEARS 1975-1978: IN MILLIONS OF 

DOLLARS AND PERCENT DISTRIBUTION 

Program 1975 a/ 1976 1977 1978 1979 b/ 

Activity Dollars Percent Dollars Percent Dollars Percent Dollars Percent Dollars Percent 

Training 752 25.6 1,138 21.7 1,305.6 22.1 1,648.1 17 .0 2,133.1 18.2 

OJT ~/ 118 3.9 272 5.2 339.2 5.7 398.9 4.1 675.3 ~/ 5.8 

Classroom 634 20.8 866 16.5 996.4 16.4 1,249.2 12.9 1,457.8 12.4 

Work 

Experience 1,355 44.4 1,491 28.5 1.494.8 25.3 2,023.2 20.9 3,097.3 ~/ 26.4 

Public Service 

Employment 900 29.5 2,425 46.4 2,938.2 49.7 5.803.2 60.0 6,262.0 53.4 

Other 47 .-..!d 173 170.4 ~ 201.7 i/ ~ 239.7 ~ 

Total 3,054.0 100.0 5,227.0 100.0 5,909.0 100.0 9,676.2 100.0 11,732.1 100.0 

Fiscal year 1975 includes Manpower Development and Training Act and Economic Opportunity Act under 

CETA Section 3A. 

~/ Administration estimate. 

£/ On-the-job training. 

s/ Includes Private Sector Initiative. 

Includes youth programs. 

Includes $5 million Disabled Veterans Outreach Program. 
o Civilian Conservation Centers (CCCs), small residential 

centers located on Department of Agriculture or Department of Interior lands. 

o Contract Centers, operated under contract by sub-federal 

government agencies private nonprofit or profit-making 

organizations. 

o Extension Centers, 

vocational skills, 

which provide advanced training in 

as well as on-the-job training. 11 

CETA funds also support vocational education activities that 

involve institutional training. Title I of CETA mandates that 5 

percent of its funds be earmarked for grants to state governors 

for vocational educational programs. 11 In fiscal year 1978, an 

estimated $97.6 million will be spent on vocational education 

under CETA. 11 CETA vocational education funds have been used 

for training allowances, purchase of equipment, vocational guidance, and, predominantly, classroom training. il Vocational education program activities under the Vocational Education Act of 

1963 were originally designed to encourage state and local education agencies to provide market-related job training that would 

prepare individuals for productive employment in a changing 

labor market and would meet the special needs of those not 

successful in regular high school programs. These program 

11 Congressional Budget Office, Employment and Training Programs, Staff Working Paper (1976). 

11 P.L. 93-203, Section 103(c). 

11 u.s. Department of Labor, Office of Administration and 

Management, Budget Division. 

il Vocational education funds are allocated on the same basis as 

other Title I funds. The current CETA law restricts the 

amount of vocational education funds received by local prime 

sponsors to not more than 20 percent of its basic Title I 

allocation. (The Administration's proposed CETA legislation 

would reduce the amount to 10 percent.) Earmarked CETA vocational education funds account for only a small (8 percent) 

share of federal vocational education support, which is administered primarily by the Office of Education. 

6 
activities have been broadened under CETA, however, to include 

services for the educationally handicapped, as well as the 

disadvantaged, and post-secondary school enrollees (primarily in 

community and junior colleges). 

On-the-Job Training (OJT). About $400 million will be spent 

in fiscal year 1978 for on-the-job training activities. The 

proportion of CETA funds devoted to OJT activities has been 4 to 

6 percent of the total (see Table 1). The Administration's 

fiscal year 1979 budget would increase OJT expenditures by nearly 

70 percent to $675 million, or 6 percent of the total. 

OJT participants receive job-related training and instruction. They typically are given training stipends or trainee-

• level wages while enrolled in the program. 

Public Service Employment (PSE) 

Public service employment activities are funded under CETA 

to serve as a countercyclical measure during periods of high 

unemployment and to assist participants' transition to unsubsidized public sector jobs. Between fiscal years 1975 and 1978, 

CETA public service employment outlays grew sixfold, from $900 

million to $5.8 billion (see Table 2). Further, whereas public 

service employment accounted for 30 percent of CETA expenditures 

in fiscal year 1975, an estimated 60 percent of CETA monies will 

be spent on public service jobs in fiscal year 1978. 

Roughly 96 percent of CETA public service employment funds 

come from Titles II and VI; relatively small amounts are funded 

under Titles I (2 percent) and III (0.4 percent). The Work 

Incentive (WIN) program public service employment effort accounts 

for 1.3 percent of all public service employment funding. 

PSE jobholders are employed by state and local government 

agencies or by nonprofit organizations. They provide a variety 

of services from child care to police and fire protection. 

During fiscal year 1978, the estimated average federal cost for 

a full-time PSE employee is $8,600. This cost includes overhead 

and fringe benefits as well as participants' wages, which may 

be supplemented by local employing agencies. 

7 
TABLE 2. PUBLIC SERVICE EMPLOYMENT EXPENDITURES AND JOB SLOTS, 

FISCAL YEARS 1975-1978: IN MILLIONS OF DOLLARS 

1975 1976 1977 1978 !il 1979 !il 

Expenditures 

CETA Title II 503 -- 'E./ -- 'E./ -- bl -- bl 

CETA Title VI 246 2,179.6 2,738.4 5,580.5 6,035.5 

Other s::./ 151 ~I 245 199.8 222.7 226.5 

Total 900 2,425 2,938.2 5,803.2 6,262.0 

Job Slots 111,262 290,300 344,100 680,900 725,200 

SOURCE: Unpublished Department of Labor data. 

!il Estimated. 

'fl.1 Titles II and VI were combined under an emergency supplemental appropriation. 

sj Includes WIN, Title I, and Title III public service jobs. 

~I Includes $53 million of Emergency Employment Act. 

Work Experience 

Work-experience programs provide part-time employment 

opportunities in settings outside traditional labor markets. 

The work experience is usually provided either as an adjunct to 

classroom training or it is offered to participants who are 

unable to hold full-time jobs {for example, school-age youth, the 

elderly, and female AFDC recipients with school-age children}. 

These part-time jobs are lo~ated in public and private nonprofit 

agencies. ;2./ 

11 Department of Labor, Employment and Training Report of the 

President. 1977, p. 45. 

8 
Little information exists about the nature of CETA workexperience program activities. il In general, these programs are 

modeled on similar pre-CETA programs, such as the OEO-funded 

Neighborhood Youth Corps (NYC) and Operation Mainstream programs. 

NYC activities were divided into three separate programs: 

o NYC In-School: A program administered by state and 

local governments and private nonprofit agencies, providing potential dropouts, part-time employment, remedial 

education, and varying levels of supportive services. 

o NYC Out-of-School: A work-experience program designed to 

increase earnings and school attendance by providing 

part-time employment to former school dropouts. 

o NYC Summer Jobs: A work-experience program designed 

primarily to reduce teenage crime and provide income. 

This program became the principal component of NYC, 

accounting for approximately three-fourths of NYC enrollments during fiscal year 1972. LI 

Operation Mainstream was designed as a work-experience 

program for "chronically unemployed and poor adultsll who were 

not served by existing programs. Operation Mainstream programs 

primarily served individuals who were unable to obtain employment or training because of their age, physical condition, obsolete skills, or poor economic conditions. ~I Program activities 

varied widely across project sites, but included training, placement, and work experience as subprofessional aides and clerical 

workers in rural conservation and beautification projects (Green 

Thumb), and community service programs. 

il Program data on work-experience programs sponsored under CETA 

relate only to participant characteristics, costs, and enrollment levels. 

LI Charles Perry and others, The Impact of Government Manpower 

Programs (Philadelphia: University of Pennsylvania Press, 

1975), p. 425. 

~I Ibid., p 454. 

9 
Job Placement 

CETA prime sponsors themselves often provide job placement 

assistance for program participants or offer assistance in 

conjunction with other agencies, principally the U.S. Employment 

Service (ES). CETA job placements are defined in three broad 

categories, depending on the degree of program responsibility for 

the placement: 1/ 

o Direct placements: Individuals are placed in unsubsidized jobs after receiving only intake, assessment, or 

job-referral services. 

o Indirect placements: Individuals are placed in unsubsidized employment after receiving CETA-sponsored employment, training, or support services. 

o Self-placement: 

initiative. 

Individuals find jobs on their own 

About 750,000 CETA Title I, II, and VI participants were 

placed in unsubsidized jobs in fiscal year 1977. CETA job 

placement activity is much lower than that of the Employment 

Service, which provided job olacement assistance and counseling 

to approximately 4.1 million individuals in fiscal year 1977 

through 2,500 local employment service offices. 10/ In some 

areas, ES is responsible for e~igibility certification for 

public service employment. 11/ \ 

CETA program data categorize participants who leave the 

program to enroll in school or other manpower programs as 

"other terminations"; and those who leave for reasons unrelated to jobs as "nonpositive terminations." Department of 

Labor, Employment and Training Report of the President. 

1978, p. 43. 

10/ Unpublished Department of Labor data. 

11/ Mark L. Chadwin and others, 

Institutional Analysis, U.S. 

Monograph 51 (1977). 

10 

The Employment Service: An 

Department of Labor, R&D 
Programs for Special Client Groups 

Under Title III, CETA provides employment and training services to such specific client groups as youth, Native Americans, 

and migrant and seasonal farmworkers. In addition, the Work 

Incentive (WIN) program for welfare recipients and the Community 

Service Employment Program for Older Americans (CSEOA) provide 

services similar to those provided under CETA. With the exception of the programs for older workers, programs for special 

client groups cover a variety of activities similar to those 

provided by general CETA funds: work experience, classroom 

and on-the-job training, and public service employment (see 

Table 3). 11/ 

Summer Program for Economically Disadvantaged Youth. The 

summer youth program accounts' for 51 percent of all funds provided to serve special target groups. During fiscal year 1978, 

it is expected to provide work experience during the summer 

months for about 1 million participants. 11/ The summer youth 

program is similar to the Neighborhood Youth Corps summer program, but larger. 

Migrant and Seasonal Farmworker Programs. Migrant and 

seasonal farmworker programs provide services designed "to 

improve living and working conditions for those who wish to 

continue in the agricultural labor market, while aiding others 

to find more stable employment in other occupations." 14/ The 

programs resemble those previously sponsored by the Office of 

Economic Opportunity. The CETA authorizing legislation requires 

that these programs receive 5 percent of Title I appropriations. 15/ 

1£/ CSEOA programs provide work experience with public and 

private nonprofit employers for individuals 55 and older. 

The Summer Youth program provides classroom training and 

work experience. 

11/ Unpublished Department of Labor data. 

li/ Department of Labor, Employment and Training Report of the 

President. 1977, p. 52. 

15/ P.L. 93-203, Section 303(2). 

11 
TABLE 3. CETA PROGRAM EXPENDITURES FOR SPECIAL CLIENT GROUPS, BY ACTIVITY, FISCAL YEARS 1977 AND 1978: IN MILLIONS OF DOLLARS 

Program 

CETA Title III 

Migrant and seasonal 

farmwork.ers 

Native Americans 

Summer youth 

Community Service 

Employment for Older 

Americans 

Work Incentive Program 

Total 

On-the-Job 

Training 

1977 1978 ,!.I 

4 

3 

106 

113 

5 

11 

100 

116 

Classroom 

Training 

1977 1978,!.1 

15 

14 

50 

79 

18 

20 

52 

90 

Work 

Experience 

1977 1978 1!/ 

6 7 

23 12 

575 672 

72 150 

-li 18 

690 859 

Public Service 

Employment 

1977 1978 

12 19 

68 74 

80 93 

Other 

1977 1978 ,!.I 

36 45 

2 

ill 108 

158 155 

Total 

1977 1978 .!.I 

61 75 

52 64 

575 672 

72 150 

---lli 

1,120 1,313 

SOURCE: U.S. Department of Labor, Employment and Training Administration, Office of Administration and Management, Division 

of Budget Formulation and Analysis. 

Estimated. 

kl Less than $0.5 million. 
Sixty percent of the $75 million in fiscal year 1978 migrant 

and seasonal farmworker program funds will be spent on "other" 

services, including child care, medical and dental care, housing, 

and nutritional services. 1£/ Approximately 7 percent of funds 

will be used to provide institutional training, 24 percent for 

on-the-job training, and 9 percent for work-experience programs. 

Native American Programs. Programs serving American Indians, Eskimos, and Aleuts under the Native Americans program 

receive a legislatively mandated share (4 percent) of Title I 

funds. Of the $64 million estimated for expenditure under this 

program in fiscal year 1978, 31 percent will be used for institutional training. About 5, 000 individuals will be served by 

the training programs; about 9,600, by the public service employment and work-experience programs. 

Work Incentive (WIN) Program. The Work Incentive program 

was authorized by amendments to Title IV of the Social Security Act of 1967. It is designed to offer a variety of work, 

training, and social services to employable Aid to Families with 

Dependent Children (AFDC) applicants and recipients. A revised 

program, WIN II, became effective in July 1972. It refocused 

WIN efforts toward direct placement, providing training, counselling, and other services only when direct placement is not 

feasible. Supportive services offered through WIN include day 

care, medical services, and transportation. The WIN program 

is jointly administered by the Departments of Labor and Health, 

Education, and Welfare. 12/ 

THE IMPACT OF CETA 

Evaluations of CETA activities have not been completed 

because the program is new and because its administration is 

decentralized. Nevertheless. similarities between CETA and 

earlier employment and training programs make studies of the 

latter useful in the CETA reauthorization process. Unfortunately, however, conclusions about the effectiveness of various 

pre-CETA programs in increasing earnings and employment stability 

~/ Unpublished Department of Labor data. 

12/ Ibid., pp. 57-58. 

13 
differ widely, making the results difficult to interpret. Positive results from program participation are often found among 

some participant groups, while no impact is apparent for others. 

Impact of Training 

CETA Title I training activities resemble those funded 

under the Manpower Development and Training Act (MDTA) of 1962. 

MDTA programs included classroom training, remedial and skill 

training, on-the-job training, supportive services, and training 

allowances. Although the initial objective of MDTA was to retrain mature, experienced family heads displaced by technological 

and economic change, the program's emphasis shifted to training 

lower income and unemployed workers, and to on-the-job rather 

than institutional training. j!1 

The major pre-CETA on-the-job training programs were carried 

out under MDTA and the National Alliance of Businessmen's Job 

Opportunities in the Business Sector Program (NAB-JOBS). Under 

the contract portion of this latter program, private firms 

were reimbursed on a fixed-fee basis for the extraordinary costs 

of hiring, training, and providing supportive services to disadvantaged new workers (long-term unemployed minorities and 

others with special handicaps). 

Evaluation studies of various pre-CETA programs found that 

the impact of these employment and training efforts depended on 

the type of training offered and the kind of client served. More 

formal institutional and on-the-job training programs had generally greater impact on earnings and employment than either 

work-experience or public employment programs. Individuals with 

labor-market disadvantages (racial and ethnic minorities, youth, 

and women) usually experienced the largest gains from program 

participation, when compared with similar individuals not in the 

program. 

~I Perry and others, The Impact of Government Manpower Programs, p. 150. 

14 
Institutional Training. Studies of the impact of MDTA 

classroom training programs indicate that earnings increased by 

$400 to $800 per year immediately following program completion. 

These added earnings declined in subsequent years. Minorities 

and women generally showed greater post-program gains in earnings 

than whites or males, but further evidence suggests that these 

relative gains did not persist. ~/ 

The increases in post-program earnings can be associated 

with either increased hourly earnings, increased employment 

during the year, or some combination of both. Recent studies 

indicate that the impact of training on wage rates is minimal: 

the wage rate increases of participants are not substantially 

different from those of nonparticipants. Nevertheless, training 

program experience may enable participants to find more stable 

employment than could previously be obtained, resulting in 

increased annual earnings. 20/ 

Job Corps. Although the evaluations of post-Job Corps 

employment and earnings gains are not definitive, most of the 

evidence indicates substantially improved post-program employment 

and wages. Earnings gains have also been found to increase with 

the length of program participation. Trainees have been placed 

in centers close to their homes in an attempt to reduce dropout rates and thereby increase the length of enrollee participation. One study of Job Corps effects showed that post-program 

gains are positive up to 18 months after completion of the 

program. 21:./ 

~/ Congressional Budget Office, Employment and Training Programs; and Perry and others, The Impact of Government 

Manpower Programs, p. 166. 

]&/ Nicholas M. Kiefer, "The Economic Benefits of Four Manpower 

Training Programs" (paper presented at the Conference 

on Evaluating Manpower Training Programs, Princeton, N. J. 

1976). 

11/ Louis Harris and Associates, "A Study of the Status of 

August 1966 Job Corps Terminees 18 Months After Termination" (unpublished, 1968), cited in Perry and others, The 

Impact of Government Manpower Programs, p. 88. 

15 

31·937 O. ?9 • 3 
Vocational Education. Data for evaluating the impact of 

vocational education programs are generally inadequate or unused. 

11/ One recent study indicates that despite the fact that many 

of the earlier studies were methodologically flawed, their conclusion that vocational education training per se does not lead 

to higher earnings than general or college preparatory education 

is a valid one, particularly in the case of black students. 

White students with high school level vocational training combined with post-high school training fared considerably better in 

terms of higher earnings than other whites. 23/ 

On-the-Job Training. OJT is generally estimated to increase 

post-training earnings by at least 20 to 30 percent more than 

institutional trainirtg. 1!i/ Further, OJT appears to be less 

expensive than institutional training, but costs of the former 

may be understated because employers may choose to bear a portion 

of the costs not compensated through the federal program. This 

apparent superiority in cost effectiveness may be distorted by 

the fact that OJT usually serves far fewer participants than 

institutional training, and employers may choose to provide 

training to only the most able applicants. On the other hand, 

OJT may provide participants access to previously unavailable 

employment. 1:2/ 

Economic gains to NAB-JOBS program participants, measured 

a year later by increases in the annual earnings of trainees relative to a comparison group, averaged $27 for white male trainees; $410 for white females; $108 for black males; and $182 for 

black females. ~/ The persistence of the increase in earnings 

1£/ General Accounting Office, What is the Role of Federal 

Assistance for Vocational Education? (December 31, 1974). 

]d/ John T. Grasso, The Contributions of Vocational Education, 

Training and Work Experience to the Early Career Achievements of Young Men (Center for Human Resource Research, 

1975). 

1!i/ Perry and others, The Impact of Government Manpower Programs, p. 50. 

1:2/ Congressional Budget Office, Public Employment and Training 

Assistance, pp. 28-31. 

1:2../ Kiefer, "Economic Benefits of Four Manpower Training Programs," p. 15. 

16 
attributable to the program is unknown. Further, a General 

Accounting Office report on the NAB-JOBS program concluded that 

the program did not significantly alter hiring decisions. Instead, the program may have resulted in substantial windfall 

gains to employers who, because of a shortage of workers during 

the Vietnam War build-up period, would have hired similar workers 

in the absence of the program. 111 

Impact of Public Service Employment 

Several kinds of criteria are relevant for evaluating 

public service employment programs: the net number of jobs 

created, their impact on participants' future employment and 

earnings, and the value of the public services provided by 

participants. Most evaluations of PSE have focused on job 

creation; less attention has been given to the impact of these 

jobs on the economic circumstances of the participants, and 

almost none to the value of the services. 

Net Job Creation. The extent to which pub 1ic service 

employment results in the creation of new jobs has been debated 

at least as long as such programs have existed. In 1976, the 

Congress directed the National Commission for Manpower Policy to 

study and report on the net job creation effects of public service employment. Two major reports resulted from this mandate. 

One reviewed the results of earlier econometric studies of 

fiscal substitution--the substitution of federal for local 

funds--and used econometric techniques to arrive at new estimates. Another study used field observers to report on the 

characteristics of CETA public service employment participants 

and jobs. These studies used different methodologies, each with 

its limitations. 281 

lJj To the extent that this occurred, subsidized workers may 

have displaced unsubsidized workers without increasing total 

employment. General Accounting Office, Evaluation of 

Results and Administration of the JOBS Program in Five 

Cities (1971). 

~I Michael E. Borus and Daniel S. Hamermesh, "Study of the Net 

Employment Effects of Public Service Emp10yment--Econometric 

Analyses," in Job Creation Through Public Service Employment, Volume III, An Interim Report to the Congress of the 

17 
The econometric study indicated that econometric estimates 

of the degree of fiscal substitution are subject to a high degree 

of uncertainty and depend upon the time period studied and the 

assumptions used. The study found that the estimates of fiscal 

substitution were not statistically reliable and varied from an 

estimate that creating 100 CETA job slots led to a real increase 

of 44 jobs to an estimate that it actually reduced jobs by 42 

during a five-quarter period. 

The second study indicated that a relatively small share of 

CETA jobs (18 percent) are used to displace jobs that would have 

otherwise existed. This study defined displacement very narrowly 

and used survey methodology. The reliability of the data and the 

the potential for generalizing their results are difficult to 

assess. J:!i! 

The varying estimates of the extent of fiscal substitution 

provide little guidance in assessing the extent of the problem, 

but several factors appear likely to reduce substitution: 

o Fiscal substitution is less likely when wage rates are 

low and eligibility criteria are stringent. Although 

the federal wage level is important in limiting fiscal 

substitution, the degree of state and local supplementation allowed will also have an effect: the higher the 

supplementation allowed, the less restrictive the federal 

wage limit, and the more likely fiscal substitution. 

o The degree of fiscal substitution may vary depending on 

the type of employing organization. For example, PSE 

jobs in local government may be more likely to lead to 

displacement than jobs in nonprofit organizations. l!l.! 

National Commission for Manpower Policy (1978), 

149; Richard Nathan and others, Monitoring the 

Service Employment Program, vol. II, report prepared 

National Commission for Manpower Policy (1978). 

pp. 89-

Public 

for the 

J:!i! Another recent survey study by the National Research Council 

of the National Academy of Sciences cited by the Nathan 

study estimated that, during the first 10 quarters of CETA, 

fiscal substitution averaged 35 percent. National Academy 

of Sciences, CETA: Local Control of Manpower Programs 

(forthcoming). 

l!l.! Nathan and others, Monitoring the Public Service Employment 

Program, pp. 32-38. 

18 
o The type of public service job affects the degree of 

substitution. Special projects that have a relatively 

short time span seem to lead to less substitution than 

jobs involving regular activities and services. 

o The speed with which public service employment can be 

implemented (the build-up rate), as well as the number of 

jobs created, influence the effectiveness of public 

service employment as a countercyclical policy tool and 

the degree of fiscal substitution. The maximum build-up 

rate is partly a function of the capacity of state and 

local governments to absorb additional employees; unfortunately, however, there have been no evaluations of 

the determinants of this capacity. Experience with the 

current PSE program suggests that rapid implementation 

of PSE is possible. During the May 1977 to April 1978 

period, PSE employment grew from 301,000 to 725,000, a 

build-up rate of 38,500 jobs per month. From May through 

November 1977, the rate was 45,500 per month. 

Wage Rates. To date, little information is available on the 

post-CETA earnings experience of participants. The National 

Planning Association (NPA) study of the Public Employment Program 

(PEP) found that participants' post-program wages were increased 

by about 36 percent over pre-program levels. In most instances, 

participants who could not secure unsubsidized public sector jobs 

following the program did not sustain their earnings gains. 11/ 

Transition to Unsubsidized Employment. About 9.5 percent 

of CETA Title VI participants during fiscal year 1977 left the 

program to enter unsubsidized employment, mostly in the public 

sector. 32/ According to the NPA study of PEP, those most likely 

to obtain permanent public sector jobs were white, professional 

or clerical workers, and highly educated. 33/ 

11/ National Planning Association, An Evaluation of the Economic 

Project of the Public Employment Program, Final Report, 

Volume I (May 22, 1974), pp. 69-90. 

11:../ During fiscal year 1977, only 22 percent of CETA Title VI 

participants left the program. Comptroller General, Information on the Buildup in Public Service Jobs, p. 41. 

11/ NPA, An Evaluation of PEP, p. 90. 

19 
Impact of Work-Experience Programs 

Few methodologically sound evaluations of the labor-market 

impact of the various NYC programs exist. One study found no 

significant relationship between participation in the program and 

subsequent earnings levels. 341 In-school program participants 

had significantly higher post-high school earnings than similar 

nonparticipants, primarily because of their higher participation 

rates in the labor force. 111 

Analyses of the economic impact of Operation Mainstream 

have focused on the extent to which it acted as an income maintenance program for enrollees and produced socially useful 

services. Of the average $4,631 federal cost per year of service, about 83 percent, or $3,840, went to enrollees in the form 

of wages and other fringe benefits. Enrollees' income from other 

sources averaged about $1,000 per year. Since the median preenrollment family income was about $1,874, participants' incomes 

increased to $4,874, or about 123 percent of the 1970 poverty 

level threshold for a nonfarm family of four. ~I 

Impact of Labor-Market Services 

Placements. During fiscal year 1977, one-third of all individuals who left CETA programs were placed in unsubsidized 

jobs, compared with 29 percent in fiscal year 1976 (see Table 4). 

The proportion of those who left either to attend school or to 

enroll in other employment and training programs (including 

programs under other titles of CETA) was 36 percent, sligh t1y 

less than the percentage in 1976. The proportion of participants 

who left for reasons unrelated to programs (llnonpositive terminations") declined slightly from 33 percent in 1976 to 29 percent 

in 1977. 

l!±.1 Kiefer, "Economic Benefits of Four Manpower Training Programs," p. 15. 

351 Perry and others, The Impact of Government Manpower Programs, p. 440. 

~I Current Population Reports, Consumer Income, Characteristics 

of the Population Below the Poverty Level: 1975, Series 

P-60, No. 106 (June 1977). 

20 
TABLE 4. PARTICIPANT TERMINATIONS FROM CETA TITLE I, II, AND VI PROGRAMS, 

FISCAL YEARS 1976 AND 1977: PERCENT DISTRIBUTION ~ 

Type of Termination 

Total 

19761977 

Title I 

1976 1977 

Title II 

1976 1977 

Title VI 

1976 1977 

Positive 67.5 70.7 68.0 70.2 75.8 83.2 61.4 54.2 

Placements 28.9 34.5 31.0 38.9 17.2 17.5 26.8 33.8 

Direct 6.9 4.7 9.1 6.5 0.7 0.3 1.3 0.5 

Indirect 15.5 21.7 16.2 24.5 1l.2 11. 9 15.3 19.2 

Self 6.5 8.1 5.7 7.9 5.3 5.3 10.2 14.1 

Other 38.6 36.2 37.0 31.3 58.6 65.7 34.6 20.4 

Nonpositive 32.5 29.1 32.0 29.7 24.2 16.5 38.6 45.5 

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 

Number of 

Participants 

(in thousands) 2,381.0 2,170.6 1,654.7 1,224.6 726.3 Jl/ 946. a Jl/ 

SOURCE: Department of Labor, EmQlo~ent and Training ReQort of the President I 1977, 

p. 43; and unpublished Department of Labor data. 

A/ Types of terminations are: positive, if they are related to jobs or activities 

that increase employability, and nonpositive if they are not; direct placements, 

if individuals are placed in unsubsidized employment after receiving job referral 

services; indirect placements, if placed in unsubsidized employment after receiving training, employment, or supportive services; self-placements, if individuals found jobs through their own efforts. 

Jl/ Numbers refer to terminations under combined Titles II and VI. 

Earnings. To date there is no information on the effectiveness of CETA placement activities in increasing participants' 

long-run earnings. Preliminary results from a study of the 

Employment Service indicate that applicants who received referral 

and placement services experienced more than 30 percent higher 

annual earnings gains than applicants who did not receive those 

services. After adjustments were made for demographic differences between the two groups, however, their relative annual 

earnings gains were not significantly different. 

21 
Impact of Programs for Special Client Groups 

A few evaluative studies offer insights into the various 

programs for special client groups. 

o Summer Youth Program. To the extent that the current 

program is similar to earlier ef forts funded under NYC, 

the effect of the program on participants' long-term 

employment and earnings is marginal at best. There 

is a sizable impact, however, on short-run unemployment 

rates. l]j 

o Migrant and Seasonal Farmworker Programs. Like earlier 

OEO programs, this program mainly provides supportive 

services. The most recent evaluation of a component 

of this program, made in 1974, indicated that 52 percent of the participants in the High School Equivalency 

Program (HEP) for migrant and seasonal farmworkers 

graduated; the average cost was $3,600 per graduate in 

1972-1973. 38/ 

o Native American Programs. Current programs are similar 

to those operated earlier by OEO. Evaluations of program impact are not available at this time. 

o Work Incentive (WIN) Program. WIN is designed to provide, individual AFDC recipients with services, incentives, and opportunities leading to unsubsidized employment, increased earnings, and reduced welfare dependency. 

Available evidence indicates limited effectiveness of 

the WIN program: 

§]j Bernard E. Anderson, "Youth Employment Problems in the Inner 

Ci ty," in Congressional Budget Office, Report of Congressional Budget Office Conference on the Teenage Unemployment 

Problem: What Are the Options? (1976); Malcolm S. Cohen, 

"The Direct Effects of Federal Manpower Programs in RedUCing 

Unemployment," Journal of Human Resources (Fall 1969), 

pp. 491-507. 

~/ U. S. Department of Labor, Manpower Administration, Evaluation of High School Equivalency Programs for Seasonal 

Farmworkers, SEG Report No. 35 (May 1974). 

22 
Unsubsidized employment. During fiscal year 1976, 

about one-fourth of WIN registrants entered fu11-

or part-time emp1oyment.]!i/ Many WIN registrants 

might have found employment without participation. 

When WIN participants' experiences were compared with 

those of similar nonparticipants, WIN participation 

was found to decrease the number of weeks of unemployment by an annual average of 2 to 3 weeks for 

males, and by 4 to 5 weeks for females. ~/ 

Earnings. Analysis of WIN participant experience 

indicates limited earnings increases from program 

participation: no discernible increase in the 

average earnings of men, but increases of $143 to 

$225 per year in the average earnings of women. 41/ 

Welfare Dependency. There is considerable movement 

into and out of poverty, welfare status, and WIN. 

The effectiveness of the WIN program in reducing welfare dependency has been limited. WIN participation 

has resulted in little or no significant reduction 

in the number of weeks on welfare; most reductions 

were for those receiving training. 42/ The impact of 

WIN in reducing the size of welfare grants has also 

been limited: grants declined by $16-$25 per month 

for women, and only those men who were in WIN-PSE for 

eight months or more experienced a reduction in their 

welfare grants ($60 per month). !1/ 

39/ Congressional Research Service, Welfare Reform Background 

Paper (1977). 

40/ Bradley Schiller and others, The Impact of WIN-II (Berkeley, 

Calif.: Pacific Consultants, 1976). 

!1/ Ketron, Inc., Differential Impact Analysis of the WIN-II 

Program (draft report, February 1978). 

!il:../ Leonard Goodwin, tlWhat Has Been Learned From the Work Incentive Program and Related Experiences: A Review of Research 

With Policy Implications, Final Reporttl (Worcester, Mass.: 

Worcester Polytechnic Institute, Department of Social 

Science and Policy Studies, February 1977; processed). 

43/ Ketron, 

gram. 

Inc., Differential Impact Analysis of WIN-II Pro23 
CHAPTER III. EFFECT OF ALTERNATIVE ACTIVITY RESTRICTIONS 

AND FUNDING TRIGGERS 

The concepts of program flexibility and local decisionmaking 

by local program ,agents have been a primary concern in the 

establishment and operation of the current CETA program. Prime 

sponsors have usually been able, within broad guidelines, to 

determine the mix of activities that they believe to be most 

appropriate to their clients or that they most want to provide. 

Congressional decisions on CETA funding levels, as well as 

the latitude accorded prime sponsors, have led to an increased 

emphasis in recent years on work experience and public service 

employment. The available evidence suggests, however, that 

training activities are more likely to increase future earnings 

and employment prospects than are public service employment and 

work experience. If that is correct, it may mean that the recent 

trend is undesirable. On the other hand, some of the ability to 

design programs to fit local needs would be lost if national 

standards required specific mixes of activities. Thus, a major 

policy issue is how to achieve more effective mixes of CETA 

activities. 

THE IMPACT OF RESTRICTIONS ON ACTIVITY MIX 

In order to emphasize the structural problems of the CETA 

client population and to provide "job training and employment 

opportunities for economically disadvantaged persons, which will 

result in an increase in their earned income," 1/ the House 

committee bill and the Carter Administration's CETA reauthorization proposal (H.R. 11086 and S. 2570) would limit to 50 

percent the share of each prime sponsor's Title II CETA funds 

that can be used for public service employment and work experience. During fiscal year 1977, the combination of work experience and public service employment under Titles I and II 

accounted for 66 percent of Title I and II expenditures. Thus, 

1/ H.R. 11086. 

24 
the effect of the proposed limit would be to decrease by nearly 

one-third the expenditures on work experience and public service 

employment relative to expenditures on training and other activities. 

The Administration's fiscal year 1979 budget request, 

however, which was submitted before its CETA proposal, would 

continue to support 725,000 public service jobs. In that event, 

funding for the proposed Title II program would come solely from 

the $2 billion requested for current Title I programs. Accordingly, if prime sponsors viewed the 50 percent limit as a 

target, the result might be a small increase in the share of 

public service employment and work-experience activities above 

the Title I share of 47 percent in fiscal year 1977. 

The Administration's CETA proposal would also restrict Title 

VI funding to public service employment and work-experience 

activities. The national effects of this restriction would be 

limited; in fiscal year 1977, only $6 million (less than half a 

percent) of Title II and VI funds were not devoted to PSE or 

work-experience activities. On the other hand, particular 

programs of some prime sponsors may be more affected by such a 

restriction. 

Each of the proposed reauthorization bills would also 

establish a new program of job search and relocation assistance 

for economically disadvantaged, unemployed, and underemployed 

persons. This program would broaden the scope of services under 

CETA because job search and placement assistance are not currently identified as a separate CETA program. Although the 

proposed bill would allow local providers to determine whether 

CETA prime sponsors or the local Employment Service agencies 

would provide such services, increased CETA involvement is very 

likely. 

RELATIVE SIZE OF THE PSE PROGRAM 

In both the Administration and the House committee CETA 

bills, the level of public service employment activities funded 

under Title VI would be tied to the national rate of unemployment. The Senate committee bill would provide "such sums as may 

be necessary," as under current law. 

According to the formula in the Administration bill (Section 

602 (b)), a base appropriation of $1 billion would be available 

25 
for Title VI public service employment jobs regardless of the 

national unemployment rate. This sum would be distributed only 

among areas with substantial unemployment. 11 The level of 

funding would increase when the unemployment rate rose above 4.75 

percent; $1 billion in additional funds would be provided on a 

quarterly basis for any full one-half percentage point increase 

above the 4.75 percent level. 11 Funds would be obligated on an 

annual basis and reduced by the amount of "triggered" funds 

obligated during the three preceding quarters. The proposed 

trigger would not become effective until fiscal year 1980. 

Starting in the first quarter of fiscal year 1980, obligations for public service jobs under the Administration proposal would be based on the national unemployment rate for 

1/ Areas with unemployment rates of 6.5 percent or higher for 

the previous four quarters. 

11 Although the bill specifies 4.75 percent, the governing rate 

would in fact be 4.8 percent since the Bureau of Labor 

Statistics does not announce its estimates to two decimal 

places. 

The trigger formula can be expressed algebraically in the 

following manner: 

Where 

$PSE 

T 

X 

$PSE :: $1b + ($1bT + $lb (X - 4.75» 

0.5 

PSE obligations 

= 0 if unemployment rate below 4.75 percent 

1 if unemployment rate for most recent quarter 

exceeds 4.75 percent 

quarterly seasonally adjusted national unemployment 

rate in whole one-half percentage points 

The amount in parentheses would be reduced by the amount 

of obligations in the three preceding quarters. In fiscal 

year 1980:1, the most recent quarterly rate is 5.76. 

$PSE = $1b + $lb(l) + $1b ~5.75 - 4.75l 

0.5 

= $1b + $1b + $2b 

= $4b 

26 
the most recent quarter. A 5.8 percent unemployment rate would 

result in obligations of $4 billion, enough to support approximately 409,000 public service jobs at an estimated cost of $9,789 

per job (see Table 5). If the unemployment rate fell to 5.4 

percent by the last quarter of fiscal year 1980, and to 4.9 

percent in the final quarter of fiscal year 1981, obligations for 

public service employment jobs would decline. About $3 billion 

would be available in fiscal year 1981, funding 290,000 public 

service jobs, and $2 billion would be available in fiscal year 

1982, supporting 183,000 public service jobs. Thus, the Administration's proposed trigger mechanism would phase-down public 

service employment funds and jobs as unemployment rates declined. 

The Senate and House committee bills differ substantially 

from that of the Administration in their treatment of Title VI 

PSE. The Administration bill places all PSE in Title VI, whereas 

the Senate and House committee versions retain the current 

practice of dividing PSE between Title VI and Title II. In 

addition, the trigger for authorizing Title VI funds under the 

House and Senate committee bills differs from that in the Administration proposal. 

The Senate Human Resources Committee bill authorizes "such 

sums as may be necessary" to fund Title VI PSE jobs. The bill 

anticipates that the necessary level of funding would decline 

with improvements in the overall economy.!!../ If the level of 

PSE jobs declined at the same rate as the total number of unemployed, about 399,000 Title VI PSE jobs would be funded in 

fiscal year 1979; 377,000 in fiscal year 1980; 351,000 in fiscal 

year 1981; and 332,000 in fiscal year 1982 (see Table 5). 2/ 

The House Education and Labor Committee bill would authorize 

Title VI funding sufficient to provide jobs for 25 percent of 

the unemployed in excess of 4 percent of the labor force. The 

House trigger would take effect in fiscal year 1980. Based on 

!!..f Comprehensive Employment and Training Act Amendments of 1978, 

S.R. 891, 95 Congo 2d sess. (1978), p. 77. 

if The Senate committee bill provides that $3 billion must be 

provided for Title II PSE before Title VI positions can b~ 

funded. In fiscal year 1979, there would be approximately 

326,000 Title II jobs. 

27 
TABLE 5. ESTIMATED OBLIGATIONS AND SLOTS FOR TITLE VI PUBLIC SERVICE EMPLOYMENT UNDER ADMINISTRATION AND 

SENATE AND HOUSE COMMITTEE BILLS 

Obligations {in millions of dollarsl Job Slots (in thousands) 

Fiscal CBO Projected Admin is- Senate House Adminis- Senate House 

Year by Unemployment tration Human Education tration Human Education 

Quarter Rate !!/ bill]]) Resources .£./ and Labor E./ bill}l Resources .£./ and Labor E./ 

1979: I 6.19 1,489 780 1,489 725 399 490 

II 6.07 1,489 780 1,489 725 399 490 

III 5.98 1,489 780 1,489 725 399 490 

IV 5.76 1,489 780 1,489 725 399 490 

1980: I 5.73 1,000 928 1,086 409 377 444 

II 5.64 1,000 928 1,034 409 377 423 

III 5.50 1,000 928 956 409 377 391 

IV 5.37 1,000 928 870 409 377 356 

1981: I 5.24 750 926 838 290 351 324 

II 5.15 750 926 778 290 351 301 

III 5.06 750 926 721 290 351 279 

IV 4.92 750 926 628 290 351 243 

1982: I 4.85 500 930 617 183 332 226 

II 4.78 500 930 568 183 332 208 

III 4.71 500 930 519 183 332 190 

IV 4.66 500 930 484 183 332 177 

!!/ Based on Congressional Budget Office. "Five-Year Economic Projection", staff memorandum dated March 28, 

1978. 

l/ Trigger mechanism takes effect in fiscal year 1980; 1979 obligations reflect Administration budget request 

on a quarterly basis • 

.£./ Estimates based on assumption that PSE slots decline at the same rate as the number of unemployed persons. 

E./ Estimates based on assumption that number of PSE jobs equals 25 percent of the unemployed in excess of 4 

percent of the labor force. 
the Congressional Budget Office's projected decline in the 

unemployment rate, Title VI PSE jobs under the House proposal ~I 

would decline from 490,000 in fiscal year 1979 to 177,000 in 

the last quarter of fiscal year 1982. 21 These estimates suggest 

that the Senate committee proposal would result in the largest 

countercyclical PSE program in low-unemployment years (fiscal 

years 1981 4nd 1982), and the Administration proposal would 

result in the smallest program. Each of the bills would have the 

effect of substantially reducing Title VI jobs from their current 

levels as the economy improves. 

The true test of the efficacy of a triggering deVice, 

however, is its operation in both periods of expansion and 

periods of contraction in the level of economic activity. Table 

6 provides an illustration of the obligation of public employment funds under the Administration proposal during a hypothetical recession and recovery. ~I The actual number of PSE 

slots depends on the pattern of outlays followed by prime sponsors, which is difficult to predict. 1/ 

This simulation shows that the quarterly changes in outlays for public service employment based on variation in the 

unemployment rate would be relatively abrupt. Because obligations vary with the amounts obligated in the three previous 

~/ The Congressional Budget Office's projected unemployment 

rate is displayed by quarter in Table 6. 

21 Approximately 235,000 Title II PSE slots would be in existence in fiscal year 1979 under the House committee bill. 

~/ The figure in the table assumed that outlays will be spent at 

a somewhat slower rate than occurs at present, since all jobs 

would be in projects that take somewhat longer to mount 

than nonproject jobs. A similar analysis of the House and 

Senate triggers is not possible because they depend on the 

size of the labor force, which changes with the overall level 

of economic activity. 

2./ This analysis assumes that each triggered amount is fully 

obligated in the quarter in which it is made available, and 

takes six quarters to spend out: Q1 = $62 million; Q2 = $188 

million; Q3 and Q4 = $250 million; Q5 = $188 million; Q6 = 

$62 million. 

29 
TABLE 6. PATTERN OF PUBLIC SERVICE EMPLOYMENT FUNDING UNDER R.R. 11086 

TITLE VI DURING A HYPOTHETICAL RECESSION: RECOVERY CYCLE 

Unemp1oy- Public Service 

ment Rate Em:e1o:'i!!!ent 

in Previous Obligations Outlays End of 

Time Period Quarter (in billions {in millions Average Quarter 

of dollars) of dollars) (thousands) (thousands) 

Year 1:1 4.30 1 250 100 100 

2 4.30 0 250 100 100 

3 4.50 a 250 100 100 

4 4.70 a 250 100 100 

Total 4.45 1 1,000 100 100 

Year 2:1 4.90 2 313 125 150 

2 5.00 a 438 175 200 

3 5.70 1 563 225 250 

4 6.40 2 814 325 400 

Total 5.50 5 2,128 213 250 

Year 3:1 7.10 3 1,189 475 525 

2 7.80 2 1,564 650 700 

3 7.20 a 1,813 725 725 

4 6.50 0 1,686 700 550 

Total 7.15 5 6,252 638 625 

Year 4:1 5.80 2 1,311 575 400 

2 5.10 0 936 425 250 

3 4.90 a 624 300 200 

4. 4.80 0 500 200 200 

Total 5.15 2 3,371 375 263 

Year 5:1 4.60 1 437 175 125 

2 4.40 a 312 150 100 

3 4.20 0 250 100 100 

4 4.10 a 250 100 100 

Total 4.32 1 1.249 131 106 

SOURCE: Based on estimates provided by the Office of Management and Budget. 

30 
quarters, there is not always correspondence between the current 

quarter's unemployment rate and current obligations. Outlays 

may bear even less relation to the unemployment rate than do 

obligations, depending upon the amounts of funds carried in, 

the build-up rates, and the desired levels of job slots--factors 

largely outside the control of federal officials. The trigger 

also creates a "cliff effect" because the obligation of $1 

billion in the first quarter of each fiscal year could hinge on 

the unemployment rate changing by one-tenth of a percentage 

point. Allowing obligations to vary by smaller amounts--say, 

$200 million for each one-tenth percentage point change in 

the unemployment rate-MWould reduce this problem. Finally, if a 

recession is relatively short, though severe, the funding mechanism proposed by the Administration bill may not be capable of 

building up public service jobs quickly enough to be of countercyclical value, and the level of jobs, once established, may be 

difficult to phase down. 

Among the alternative ways of using a trigger is to insure 

that the level of public service employment will vary with the 

jobless rate. This method is incorporated in the House committee 

bill, which funds the number of public service jobs that would be 

sufficient to employ 25 percent of those unemployed above a 4.0 

percent unemployment rate during the previous four quarters. At 

a 7.5 percent unemployment rate, 890,000 public service employment jobs would be funded by this formula; 380,000 jobs would be 

funded at a 5.5 percent unemployment rate. Changing the target 

level of unemployment or the proportion of unemployed to be 

served would alter the size of the program in relation to the 

unemployment rate. Changes in the number of job slots under 

this trigger would generally be more gradual than under the 

Administration proposal. In addition, the number of public 

service jobs would not be eroded by increases in the cost of PSE 

jobs, or the size of the labor force, as under the Administration 

proposal. 

The language of the Senate committee bill is essentially 

that of the current CETA law. It would allow the most flexibility in building up the number of PSE jobs and would allow 

funding to adjust to changes in the average cost of PSE jobs and 

the size of the labor force. On the other hand, the lack of an 

explicit trigger would make phasing down the number of established PSE jobs more difficult than it would be under the other 

alternatives. 

31 

31-937 0 - 78 - 4 
CHAPTER IV. TARGETING CETA SERVICES ON THOSE IN NEED 

Labor-market problems are concentrated among certain population groups: racial and ethnic minorities, youth, and those 

with low levels of education. During calendar year 1977, when 

the average national unemployment rate was 7.0 percent, the 

unemployment rate among nonwhites was 13.1 percent; among nonwhite youths 16 to 19 years old, the rate was 37 percent for 

males and 40 percent for females. In March 1977, when the 

overall unemployment rate was 7.9 percent, the rate for those 

with less than eight years of schooling was 10 percent compared 

with 3 percent for college graduates. 11 Consequently, two major 

issues in the CETA reauthorization debate are the extent to which 

CETA should be targeted on those with the most severe labormarket problems, and whether targeting can be improved by changes 

in program eligibility rules. 

The criteria that define eligibility for CETA programs are 

an important factor in determining the ability of the program 

to serVe those most in need of CETA services. Changes in eligibility rules result in changes in the size and characteristics 

of the eligible population and the size of the program needed 

to serve the eligible group. In general, nonentitlement programs 

such as CETA serve only a small fraction of the eligible population. If job slots are limited, program operators must choose 

among eligibles, and they may favor eligibles who are the least 

costly to serve or who offer the most potential for post-program 

Success. This selection process is known as "skimming" or 

"creaming." Broad eligibility criteria may include substantial 

numbers of those needing services, but they also create large 

pools of eligibles and make skimming more feasible. 

11 u.s. Department of Labor, Employment and Earnings. January 

1978, Tables 1 and 3; u.S. Department of Labor, Educational 

Attainment of Workers, March 1977, Special Labor Force Report 

209. For discussions of the causes of these disparities see 

Congressional Budget Office, Youth Unemployment: The Outlook 

and Some Policy Strategies (1978), Income Disparities Between 

Black and White Americans (1977), and The Unemployment of 

Nonwhite Americans: The Effects of Alternative Policies 

(1976) • 

32 
Designing clear and appropriate eligibility criteria is not 

a simple task. Some groups in need of CETA services may be 

fairly easy to identify, for example, youth between 16 and 

23 years old. Other groups present special problems both conceptually and statistically. For example, what is the appropriate 

definition and measurement of economic disadvantage or "insufficiency"? Is it residence in a "distressed" area, membership 

in a disadvantaged social group, or some combination of these and 

other factors? 

ELIGIBLES UNDER CURRENT CETA DEFINITIONS 

The pre-CETA employment and training programs (with the 

exception of the Emergency Employment Act and the early Manpower 

Development and Training Act efforts) were aimed primarily at the 

"disadvantaged." Under CETA, less emphasis has been placed on 

serving the disadvantaged. Although the CETA eligibility criteria include the "economically disadvantaged," the term has been 

defined broadly to include individuals from low-income families, 

the underemployed, and recipients of cash welfare and unemployment insurance benefits. In recent years, legislative amendments 

have narrowed the definition of CETA eligibles, while some 

administrative regulations have had the opposite effect. 1/ 

Current CETA regulations define eligibles for the various 

programs and titles along many dimensions, including age, ethnicity, area of residence, unemployment experience, veteran 

status, and income. Although the attributes of eligibles will 

not always match those of participants, wide disparities between 

the characteristics of the two groups indicate that the program 

is not serving those it was intended to serve. 

Title I Eligibles 

To be eligible for Title I activities, individuals must be 

either economically disadvantaged (having an income less than 70 

1/ P.L. 94-444. The Carter Administration, in regulations 

that became effective in fiscal year 1977, changed the 

definition of economically disadvantaged from poverty level 

income to poverty level or 70 percent of the Bureau of Labor 

Statistics lower living standard, whichever is higher. The 

effect was to increase the eligible population for some 

programs by as much as 25 percent. 

33 
percent of the Bureau of Labor Statistics lower living standard 

or the poverty level, whichever is higher; or receiving cash 

welfare benefits), a foster child, unemployed at least seven 

days, or underemployed (working part-time for economic reasons, 

or a full-time worker in a poverty-level family). 11 

About 35 million individuals in 23 million family units 

were eligible for Title I activities in March 1975. The high 

incidence of older persons (more than one-fourth were age 55 or 

older), those with low levels of education, and cash assistance 

recipients in this eligible group indicates that Title I eligibility rules may be well targeted on persons with potential 

labor-market difficulties. At the same time, the characteristics 

of those who participated in the 448,000 years of service provided under Title I during fiscal year 1976 suggest that some 

skimming did occur. il 

The characteristics of those eligible and those participating in the Title I program are not identical (see Table 7). 

Participants during fiscal year 1976 were better educated, considerably younger, more likely to be nonwhite, and less likely 

to be cash assistance recipients than eligibles. The proportion of participants in the labor force immediately before program entry was similar to the proportion of eligibles in the 

labor force (61 percent of participants and 52 percent of eligib1es), but participants were more likely to have been preViously unemployed than eligibles. 

11 The lower living standard budget developed by the Bureau of 

Labor Statistics is based on the consumption patterns of individuals in various parts of the nation. It is developed 

only for urban residents of major labor markets, but the 

Department of Labor periodically publishes allowable income 

levels based on state averages for all prime sponsor areas 

in which detailed area averages are not available. For a 

family of four in 1978, 70 percent of the lower living 

standard was $7,490 while the poverty level was $6,200. 

il Years of service are numbers of full-year equivalent participants after accounting for turnover. Data on eligibles for 

calendar year 1975 from the Survey of Income and Education 

(SIE) are used to make comparisons with the data on participants taken from the Continuous Longitudinal Manpower Survey 

(CLMS). The latter were the most recent detailed data available on CETA participants. 

34 
TABLE 7. CHARACTERISTICS OF TITLE I ELIGIBLES AND PARTICIPANTS: 

PERCENT DISTRIBUTION, 1975 

Characteristics 

Male 

Female 

White 

Nonwhite 

Less than High School 

Graduate 

In Labor Force 

Employed 

Unemployed 

Age 

Under 18 

18 - 21 

22 - 29 

30 - 44 

45 - 54 

55 and over 

Median age 

Cash Assistance 

AFDC 

SSI 

Food stamps 

Total (in thousands) 

Eligibles .!!/ 

41.6 

58.4 

75.3 

24.7 

58.4 

52.0 

28.8 

23.3 

10.7 

13.9 

18.1 

18.3 

10.3 

28.7 

(35.0) 

16.2 

19.2 

22.6 

34,959.7 

Participants "!!.../ 

56.0 

44.0 

63.0 

37.0 

50.0 

61.0 

18.0 

43.0 

23.0 

31.0 

26.0 

13.0 

4.0 

3.0 

(20.5) 

15.0 

2.0 

22.0 

448.3.£/ 

~/ Congressional Budget Office tabulation of the 1976 Survey of 

Income and Education (SIE). At the time of the survey, the 

national unemployment rate was 8.3 percent. 

k/ Continuous Longitudinal Manpower Survey (CLMS) data for 

October 1975 to June 1976 • 

.£/ Refers to years of service during fiscal year 1976. 

35 
It is impossible to tell whether the differences between 

those eligible and those participating in Title I are indications 

of skimming beqlUse all of the eligibles may not apply at the 

same rate. For example, one possible explanation for the relatively small number of cash assistance recipients among participants is the high rate at which various welfare program benefits 

are reduced as earnings increase, thereby discouraging participation. Moreover, the eligibility for some cash assistance programs may in itself indicate lack of employabilHy; in the Supplemental Security Income (SSI) program, for example, eligibility 

is limited to the aged, blind, and disabled and their dependents. 

Title VI Eligibles 

The Title VI eligible population is larger than that of any 

other single CETA program except Title I. 2/ During March 1975, 

roughly 11.4 million individuals were nominally eligible for 

participation under Title VI, while approximately 227,000 years 

of service were provided under the combined Titles II and VI 

during fiscal year 1976. 

The characteristics of Title VI eligibles indicate that 

those persons who are likely to have labor-market difficulties 

are eligible for the program, but the characteristics of participants indicate that they were not representative of the eligible 

population (Table 8). This could mean that a considerable 

amount of skimming has occurred in Title VI programs. 

Title VI served far smaller proportions of females, nonwhites, the uneducated, and cash assistance recipients than were 

eligible. ~/ Eligibles and participants had similar labor 

2/ No attempt has been made to estimate the eligible population 

for Title II programs because available data do not permit 

the identification of Title II eligibles, who must reside in 

areas where unemployment rates are 6.5 percent or more for 

three consecutive months. Estimates made by the National 

Commission for Manpower Policy indicate that the size of the 

eligible population may be in the same range as for Title VI 

programs; National Commiss ion for Manpower Policy, Annual 

Report (forthcoming), Chapter III. 

i/ The data for participants are for the program prior to the 

introduction of targeting criteria in 1976. 

36 
TABLE 8. CHARACTERISTICS OF TITLE VI ELIGIBLES AND 

PARTICIPANTS: PERCENT DISTRIBUTION, 1975 

Characteristics Eligibles !l:/ Part ic ipants EJ 

Male 

Female 

White 

Nonwhite 

Less than High School 

Graduate 

In Labor Force 

Employed 

Unemployed 

Age 

Under 18 

18 - 21 

22 - 29 

30 - 44 

45 - 54 

55 and over 

Median age 

Cash Assistance 

AFDC 

SSI 

Food stamps 

Family Income .£/ 

o - 7,499 

7,500 - 9,999 

10,000 - 14,999 

15,000 or more 

Total (in thousands) 

41.5 

58.5 

65.8 

34.1 

51. 8 

76.6 

21.4 

55.2 

11.5 

19.1 

25.5 

24.8 

10.5 

8.6 

(27.1) 

51.8 

10.2 

34.3 

65.7 

9.8 

10.9 

13.6 

11,365.2 

CBO tabulation of the 1976 SIE. 

65.0 

35.0 

76.0 

24.0 

24.0 

79.0 

24.0 

55.0 

1.0 

23.0 

44.0 

20.0 

8.0 

4.0 

(25.7) 

4.0 

2.0 

9.0 

59.0 

13.0 

16.0 

12.0 

202.6 :4/ 

a/ 

b/ 

.£1 

CLMS data for final three quarters of fiscal year 1976 • 

Participants' family income refers to all public service 

employment programs. 

£/ Refers to years of service during fiscal year 1976. 

37 
force experience: the proportion of unemployed and employed 

eligibles was roughly equal to the proportion of previously 

unemployed or employed participants. 

Title III Eligibles 

Migrant and Seasonal Farmworker Program. During fiscal year 

1976 approximately 6,000 years of service were provided for 

migrant and seasonal farmworker programs, but data for program 

participants are not available. In general, persons eligible for 

migrant and seasonal farmworker programs have low levels of 

educational attainment, live predominantly in the South, and have 

relatively high rates of cash assistance recipiency. Less than 1 

in 5 of the eligibles had completed 12 or more years of schooling 

(Table 9). More than half were residents of southern states. 

Program eligibles were predominantly labor force members; nearly 

one-ha!f were employed at the time of the survey and an additional 8 percent were unemployed. More than two-thirds were 

males, and nearly two-thirds were white. 

Summer Youth Program. The eligibility rules for the Summer 

Youth Program appear relatively well targeted in relation to 

the characteristics of youth with labor-market difficulties. 

In fact, the characteristics of participants served during the 

last quarter of fiscal year 1976 are more in line with 1abormarket problems than those of the eligible population, with the 

exception of those from families receiving cash assistance 

benef its. 1/ 

In many ways, the characteristics of program eligibles 

and participants suggest that the Summer Youth Program is operated to reduce the "riot potential" in large cities. Jobs are 

genera.lly filled by males who are currently attending high school 

(Table 10). Females are underserved relative to their proportion 

in the eligible population. Nonwhites fill a disproportionate 

share of Summer Youth Program jobs: 33.8 percent of the 7.5 

million eligibles in fiscal year 1976 were nonwhite, but 49 

1/ These conclusions also hold relative to the population eligible for the program before the changes in regulations that 

occurred during fiscal year 1976. The change in definition 

of economically disadvantaged increased the eligible population by 1.1 million youths. 

38 
TABLE 9. CHARACTERISTICS OF MIGRANT AND SEASONAL FARMWORKER 

PROGRAM ELIGIBLES: NUMBERS AND PERCENT DISTRIBUTION, 

1975 

Characteristics 

White 

Male 

Female 

Nonwhite 

Male 

Female 

Less than High School 

Graduate 

In Labor Force 

Employed 

Unemployed 

Age 

Under 18 

18 - 21 

22 29 

30 44 

45 54 

55 and over 

Median age 

Primary Earner 

Cash Assistance 

AFDC 

SSI 

Food stamps 

Region 

Northeast 

Midwest 

South 

West 

Total 

Number 

455,512 

330,605 

124,907 

261,108 

150,770 

110,339 

425,341 

396,101 

56,240 

173,080 

82,394 

120,443 

114,735 

80,485 

145,483 

302,412 

124,796 

157,640 

188,486 

56,827 

113,970 

394,346 

151,478 

716,621 

SOURCE: CBO tabulation of the 1976 SIE. 

39 

Percent 

63.6 

46.1 

17.4 

36.4 

21.0 

15.4 

83.8 

59.4 

51.5 

7.8 

24.2 

11.5 

16.8 

16.0 

11.2 

20.3 

(2 7.8) 

42.2 

17.4 

22.0 

26.3 

7.9 

15.9 

55.0 

21.1 

100.0 
TABLE 10. CHARACTERISTICS OF SUMMER YOUTH PROGRAM ELIGIBLES AND 

PARTICIPANTS: PERCENT DISTRIBUTION, 1975 

Characteristics 

Male 

Female 

White 

Nonwhite 

Less than High School 

Graduate 

In Labor Force 

Employed 

Unemployed 

Age 14 - 15 

16 - 19 

20 - 21 

Median age 

Cash Assistance 

AFDC 

SSI 

Food st;:amps 

Total (in thousands) 

Eligibles !!I 

46.0 

54.0 

66.1 

33.8 

71.1 

44.3 

30.4 

13.9 

27.1 

50.5 

22.4 

(16.8) 

34.1 

12.7 

30.0 

7,544.8 

!!I CBO tabulation of the 1976 SlE. 

Participants E./ 

54.0 

46.0 

51.0 

49.0 

83.0 

53.0 

12.0 

41.0 

30.0 

58.5 

10.5 

(16.4) 

25.0 

6.0 

34.0 

225.5 £.1 

bl CLMS data for last quarter of fiscal year 1976, see eLMS, 

Table 3. 

£.1 Numbers refer to years of service during fiscal year 1976; 

the actual number of participants was 1.1 million. 

40 
percent of program participants were nonwhite. While 14 percent 

of those eligible for jobs were unemployed, about 41 percent of 

program participants had been unemployed prior to entry. ~I 

More than 70 percent of program eligibles had not completed 

high school compared with 83 percent of participants. 

Recipiency rates for cash assistance benefits differed 

substantially between eligibles and participants, except for the 

Food Stamp Program. While 34 percent of eligibles were AFDC 

recipients, only 25 percent of participants were. Thirteen 

percent of eligibles were from SSI recipient families compared 

with 6 percent of participants. Nearly equal proportions of 

eligibles and participants were food stamp recipients. 

Other Youth Programs. The characteristics of those eligible 

for the various other youth programs differ widely as a result of 

eligibility rules (Table 11). Disadvantaged youths are most 

prevalent in the populations eligible for the Summer Youth 

Program, the youth entitlement program, and the Job Corps. 

Eligible populations for the Youth Community Conservation and 

Improvement Projects (YCCIP), Youth Employment and Training 

Program (YETP), and Young Adult Conservation Corps (YACC) programs are less numerous and have higher family incomes~ 

The racial composition of the eligibles for all youth 

programs varies from two-thirds to three-fourths white. Because 

of varying age restrictions, there are large differences among 

the programs in the proportion of eligibles who have not completed high school. Fewer than 30 percent of Summer Youth Program eligibles, who must be 14-21 years old and economically 

disadvantaged, have completed a high school education. On the 

other hand, about half of the youths eligible for Youth Incentive 

Entitlement Pilot Projects (YIEPP) and the Youth Employment and 

Training Program have finished at least 12 years of school. 

The incidence of cash assistance recipients is considerably 

higher in those programs (for example, the Summer Youth Program) 

that base eligibility in part on being economically disadvantaged. In the Youth Community Conservation and Improvement Projects (YCCIP), for which eligibles need only be 16-19 years old 

~I To the extent that the Summer Youth Program serves in-school 

youths, the March unemployment rate of program eligibles 

would be expected to be lower than that prevailing during the 

summer months. 

41 
TABLE 11. ELIGIBLES FOR CURRENT YOUTH PROGRAMS: PERCENT DISTRIBUTION, 

1975 

Characteristics 

Summer Job 

Youth Corps YIEPP ~I YCCIP il YETP £1 YACC il 

White 

Male 

Female 

Nonwhite 

Male 

Female 

Less than High School 

Graduate 

In Labor Force 

Employed 

Unemployed 

Age 14-15 

16-19 

20 and over !il 

Primary Earner 

Cash Assistance 

AFDC 

SSI 

Food stamps 

Region 

Northeast 

Midwest 

South 

West 

66.1 

30.3 

35.B 

33.B 

15.7 

1B.1 

71.1 

44.3 

30.4 

13.9 

27.1 

50.5 

22.4 

12.0 

34.1 

12.7 

30.0 

18.9 

23.4 

39.9 

17 .B 

66.9 

29.9 

37.0 

33.1 

15.1 

18.0 

60.4 

54.4 

37.5 

17.0 

69.2 

30.B 

16.1 

32.2 

12.0 

27.4 

1B.9 

23.7 

39.5 

17.9 

69.5 

31.5 

37.9 

30.5 

13.1 

17.4 

50.3 

5B.4 

42.1 

16.4 

45.B 

54.2 

26.7 

29.0 

10.B 

27.1 

19.0 

23.3 

37.7 

19.9 

74.4 

3B.l 

36.3 

25.6 

13.2 

12.4 

64.8 

100.0 

100.0 

100.0 

3.2 

14.4 

4.7 

12.0 

24.7 

25.0 

31.B 

1B.5 

73.9 

3B.0 

36.0 

26.0 

13.2 

12.B 

52.1 

100.0 

6.3 

93.7 

67.B 

32.2 

7.5 

14.3 

5.0 

12.4 

24.3 

25.6 

31.4 

1B.7 

74.4 

3B.9 

35.4 

25.6 

12.5 

13.1 

46.7 

100.0 

100.0 

54.3 

45.7 

11.1 

12.7 

4.5 

12.4 

24.9 

25.1 

30.6 

19.4 

Total (in thousands) 7,544.B 5,502.4 8,306.2 1,950.9 3,060.6 3,593.5 

SOURCE: CBO tabulation of the 1976 SIE. 

al Youth Incentive Entitlement Pilot Projects. 

hi Youth Community Conservation and Improvement Projects. cl Youth Employment and Training Program. 

dl Young Adult Conservation Corps. 

~I The upper age limit is 21 years for Summer Youth, Job Corps, and 

YETP; 23 for YACC; and 25 for YIEPP. 

42 
and unemployed, fewer than one in five eligibles receives cash 

welfare benefits. The effect of different eligibility is a large 

variation across programs in the number of eligibles; more than 8 

million youths would have been eligible for the youth entitlement 

program (YIEPP). 

Different eligibility rules also result in considerable 

variation in the family income of eligibles across the various 

youth programs (Table 12). While less than 2 percent of eligibles for the Summer Youth Program, Job Corps, and YIEPP have 

family incomes of $15,000 or more, 37 percent of YETP and YACC 

eligibles and 41 percent of YCCIP eligibles do. The characteristics of eligibles for YETP, YACC, and YCCIP make skimming 

for the best qualified candidates more feasible than in the other 

three programs. And while it is true that youths must be unemployed to be eligible for YETP and YACC, the characteristics of 

those eligible for these programs and YCCIP are not consistent 

with those of youths with labor-market difficulties. 

Although youths eligible under the Summer Youth Program, Job 

Corps, and YIEPP account for 71 percent of those eligible for all 

CETA youth programs, the President's proposed fiscal year 1979 

budget would allocate only 55 percent of youth program funds to 

these activities. ~/ 

IMPACT OF CHANGES IN THE DEFINITION OF 

ECONOMICALLY DISADVANTAGED 

The Administration proposal and the Senate and House committee bills on CETA include specific definitions of "economically disadvantagedll and other terms. All of the bills would add 

several groups to the currently served cash welfare recipients, 

foster children, and those with family incomes below the poverty 

level or 70 percent of the lower living standard. Institutionalized individuals in sheltered workshops, prisons, and hospitals 

would be defined as economically disadvantaged under the proposals and would thus be eligible for CETA programs. (The House 

committee bill would also include handicapped persons living at 

home.) Except for those who could participate in programs of the 

Older Americans Act, individuals claimed as dependents for income 

tax purposes in the previous year would be considered part of a 

~/ Unpublished data, U.s. Department of Labor, Office of Administration and Management, Budget Division. 

43 
TABLE 12. FAMILY INCOMES OF YOUTH PROGRAM ELIGIBLES UNDER 

CURRENT LAW: PERCENT DISTRIBUTION, 1975 

Summer Job 

Family Income Youth Corps YIEPP YCCIP YETP YACC 

Less than $7,500 81.7 83.3 86.6 31.1 37.3 35.9 

$ 7,500 - 9,999 11.2 9.9 7.7 8.6 8.7 8.9 

$10,000 - 14,999 5.5 5.3 4.3 19.1 17.4 18.3 

$15,000 or more 1.6 1.5 1.4 41.2 36.5 36.8 ---

Total 100.0 100.0 100.0 100.0 100.0 100.0 

SOURCE: CBO tabulations of the 1976 SIE. 

person's family in determining income eligibility in the current 

year. Estimates of the institutionalized population in 1978 

indicate that the proposed changes would add 1.3 million individuals under 65 years and 1.1 million 65 or older to those 

currently eligible for CETA. 

The effect of basing eligibility on total family income for 

all those claimed as dependents for tax purposes in the preceding 

year is difficult to estimate, but the general effect would be to 

reduce the number of CETA eligibles. Youths living at home would 

be most clearly affected, but the new definition would also 

affect the eligibility of other individuals who did not work or 

who had low earnings during the previous year and had more than 

half of their support provided by another person. Wives and relatives claimed as tax dependents in families with incomes higher 

than the applicable CETA eligibility rule would be ineligible for 

CETA programs in the following year. If this rule had been 

applied to those currently eligible for Title VI proj ect jobs, 

the eligible population would have been reduced by nearly onefourth (Table 13). The majority of those excluded would have 

been youths (mostly nonwhite males), and the median age of 

eligibles would have changed from 27 years to 31. 

44 
TAB~E 13. EFFECTS OF PROPOSED CHANGE IN DEPENDENCY DEFINITION ON 

CURRENT TITLE VI ELIGIBLES: PERCENT DISTRIBUTION 

Current Proposed Percentage 

Characteristics Law Definition Change 

White 56.8 59.4 4.6 

Male 17.6 15.7 -10.8 

Female 39.2 43.7 11.5 

Nonwhite 43.1 40.5 -6.0 

Male 11.9 8.1 -31.9 

Female 31.3 32.5 3.8 

Less than High School 

Graduate 58.7 54.1 -7.8 

Cash Assistance 

AFDC 88.2 87.4 -0.9 

SSI 15.2 14.4 -5.3 

Food stamps 51.2 54.0 5.5 

Unemployed 

1 or more weeks 24.7 23.9 -3.2 

4 or more weeks 20.9 20.8 -0.5 

5 or more weeks 18.9 19.1 1.1 

15 or more weeks 15.0 15.7 4.7 

Region 

Northeast 26.8 27.3 1.9 

Midwest 24.2 24.3 0.4 

South 29.8 28.5 -4.4 

West 19.1 19.9 4.2 

Age 

Under 18 12.9 1.9 -85.3 

18-21 19.2 13.7 -28.6 

22-29 24.1 28.8 19.5 

30-44 27.2 34.8 27.9 

45-54 9.8 12.5 27.6 

55 and over 6.7 8.2 22.4 

Median age (26.9) (31.4) 16.7 

Family Income 

o - 7,500 83.6 84.6 1.2 

7,500 - 9,999 9.8 9.4 -4.1 

10,000 - 14.999 5.2 4.7 -9.6 

15,000 or more 1.3 1.3 

Primary Earner 55.9 73.2 30.9 

Total (in thousands) 5,971.3 4,516.7 -24.4 

SOURCE: CBO tabulation of the 1976 SIE. 

45 
Current CETA rules permit eligibility determinations based 

on income annualized from a three-mouth base. Under the CETA 

bills proposed by the Administration and the Congressional 

committees, the base period would be changed to six months for 

all but Title VI activities, which would retain current rules. 

This change would significantly affect the number of eligibles. 

In general, the longer the base period, the smaller the number of 

eligibles and the more likely that the individuals served are 

experiencing long-run economic difficulties rather than shortterm variations in incomes. On the other hand, a shorter base 

period would be more responsive to immediate needs as income 

changes. A disadvantage of the short base period is that it 

would allow individuals who have high annual incomes that vary 

over the year to qualify, while excluding those with the same 

level of income evenly distributed over the year. lQl 

The effect of lengthening the base period from three to six 

months is uncertain, but it may be substantially greater in CETA 

than in cash assistance programs, in which it would cause about a 

9 percent decline in the number of eligibles • .11..1 In CETA, 

indiViduals are either eligible or ineligible, while in income 

maintenance programs such as AFDC or Food Stamps benefits 

are reduced gradually as incomes increase. Consequently, the 

decrease in the number of CETA eligibles might be considerably 

larger than 9 percent. If CETA programs were funded at the 

current levels, services could be provided to a greater proportion of those with long-term economic problems. 

Impact of Changes in Title I Eligibility 

Under the proposed rules of the Administration proposal and 

the Senate and House committee bills, Title II (current Title I) 

eligibles would be required to be economically disadvantaged and 

either unemployed, underemployed, or in school. This would 

exclude some individuals who formerly had to meet only one of 

lQl Jodie T. Allen, "Designing Income Maintenance Sys terus: The 

Income Accounting Problem," in Joint Economic Committee, 

Issues in Welfare Administration: Implications of the 

Income Maintenance Experiments, Paper No. 5 (Part 3), 

Studies in Public Welfare, 93 Cong., 1 sess., 1973. 

1J) Ibid. 

46 
these criteria. For those whose eligibility is based in part on 

unemployment, the proposed bills would loosen restrictions by 

eliminating the current requirement of 30 days' unemployment and 

require that a person be unemployed 7 consecutive days (House 

committee bill) or be without a job and willing and available to accept work (Administration and Senate versions). 11/ 

These alternative changes in eligibility requirements would 

have a significant effect on the size and characteristics of the 

eligible population. Compared with current law, the estimated 

number of individuals eligible for Title II programs would be 

reduced by nearly 29 million, or more than 80 percent, under the 

House, Senate, and Administration proposals (Table 14). The 

potential for skimming would thus be reduced considerably by 

limiting the size of the eligible population. 

The proposed eligibility rules would be better targeted on 

those with labor-market problems. The proportion of program 

eligibles who are white would decrease, as would the proportion 

of males. Less educated individuals would constitute a larger 

proportion of eligibles than under current Title 1. The share 

of participants who receive AFDC payments would increase substantially, and the median age of eligibles would be much lower 

than under the present Title I. 

Impact of Changes in Title VI Eligibility 

Compared with current Title VI (a) rules, eligibility for 

public service employment would be stricter but less targeted 

11/ The eligibility requirements pertaining to PSE under Title 

II would be stricter than those related to other Title II 

programs. The Administration bill would require that 

eligibles be economically disadvantaged and unemployed for 5 

or more weeks; the Senate bill would require that PSE 

eligibles be economically disadvantaged and unemployed for 

at least 12 weeks; and the House version would apply the 

same income limits and additionally require that eligibles 

not have worked more than 200 hours in the previous 10 

weeks. 

47 

31-937 0 - 7B - 5 
TABLE 14. EFFECTS OF PROPOSED ELIGIBILITY CHANGES ON 

CURRENT TITLE I ELIGIBLES ~/: PERCENT 

DISTRIBUTION 

Eligibles 

Current Proposed 

Characteristics Title I Title II 'pj 

White 75.3 65.9 

Male 31.7 33.9 

Female 43.6 32.0 

Nonwhite 24.7 34.1 

Male 9.9 6.7 

Female 14.8 27.4 

Less than High School Graduate 58.4 56.0 

Cash Assistance El 

AFDC 16.2 30.8 

SSI 19.2 11.8 

Food stamps 22.6 32.1 

Unemployed 

1 or more weeks 22.8 79.9 

4 or more weeks 16.7 59.4 

5 or more weeks 13.8 49.5 

15 or more weeks 7.6 29.6 

Region 

Northeast 21.7 20.4 

Midwest 22.6 22.3 

South 37.9 36.1 

West 17 .8 21.1 

Age 

Under 18 10.7 23.3 

18-21 13.9 28.5 

22-29 18.1 23.8 

30-44 18.3 14.7 

45-54 lO.3 5.2 

55 and over 28.7 4.5 

Median age (35.0) (20.7) 

Primary Earner £1 47.9 45.5 

Total (in thousands) 34,959.7 6,423.3 

SOURCE: CBO tabulation of the SIE. 

al Not adjusted for changes in dependency definition. 

~I The eligibility rules for non-PSE Title II programs are 

essentially the same under each of the proposed reauthorization bills. 

£1 Does not apply .to students who are currently employed, 

for whom data are not available. 

48 
under all of the proposed CETA reauthorization bills. 11/ The 

Administration version is generally the most targeted and the 

House committee bill the least targeted on those likely to 

experience labor-market difficulties. 

Currently, 50 percent of new participants in sustainment 

jobs and all project participants must have incomes lower than 70 

percent of the BLS lower living standard. ll/ Under the provisions of the Administration bill, all new participants would 

have to meet this income test. The Senate committee bill would 

raise the applicable income requirement for new participants to 

85 percent ($9,09S), and the House committee bill would extend 

eligibility to new participants with incomes up to 100 percent 

of the BLS lower living standard (approximately $10,700 in 

1978). 12/ 

Persons who have been unemployed for 15 weeks or more and 

who meet the 70 percent income limit are currently eligible under 

Title VI (b). The Administration proposal would reduce the 

unemployment eligibility criterion to 5 weeks, while the Senate 

committee bill would require 45 days and the House committee bill 

8 weeks of unemployment as a condition of Title VI eligibility. 

These various proposed changes in eligibility for Title VI 

programs would considerably reduce the overall size of the group 

eligible for Title VI PSE jobs compared with the number eligible for the more targeted Title VI(b} program (Table IS). 

ll/ P .L. 94-444. Title VI (a) refers to the old eligibility 

requirements (Section 607), which apply to 50 percent of 

sustainment slot vacancies; VI(b) refers to the 1976 amendments (Section 608), which apply stricter criteria to all 

new slots and 50 percent of vacancies in sustainment slots. 

li/ Those Title VI jobs existing before October 1976 are referred to as sustainment jobs. The Department of Labor 

estimates that there were approximately 300,000 sustainment 

jobs at that time. 

12/ Additionally, under the House version, all Title VI participants would have to meet this test after a period of 18 

months. 

49 
TABLE 15. CHARACTERISTICS OF TITLE VI ELIGIBLES UNDER CURRENT LAW, ADMINISTRATION, 

AND SENATE AND HOUSE COMMITTEE PROPOSALS: PERCENT DISTRIBUTION ~ 

Proposed CETA Bills 

Senate House 

Current Law Administration committee committee 

Characteristics Title VI Title VI(b) bill bill bill 

White 

Male 

Female 

Nonwhite 

Male 

Female 

Less than High School 

Graduate 

Cash Assistance 

AFDC 

SSI 

Food stamps 

Unemployed 

1 or more weeks 

4 or more weeks 

5 or more weeks 

15 or more weeks 

Region 

Northeast 

Age 

Midwest 

South 

West 

Under 18 

18-21 

22-29 

30-44 

45-54 

55 and over 

Median age 

Primary Earner 

65.8 

29.6 

36.2 

34.1 

11.9 

22.2 

51.8 

51.8 

10.2 

34.3 

53.5 

51.5 

50.5 

31.2 

27.9 

24.1 

28.9 

19.1 

11.5 

19.1 

25.5 

24.8 

10.5 

8.6 

(27.1) 

47.8 

Total (in thousands) 11,365.2 

56.B 

17.6 

39.2 

43.1 

11.9 

31.3 

58.7 

8B.2 

15.2 

51.2 

24.7 

20.9 

18.9 

15.0 

26.8 

24.2 

29.8 

19.1 

12.9 

19.2 

24.1 

27.2 

9.8 

6.7 

(26.9) 

55.9 

5,971.3 

SOURCE: CBO tabulation of the 1976 SIE. 

61.1 

37.3 

23.8 

38.9 

17.8 

21.1 

54.7 

30.8 

13.0 

32.4 

100.0 

100.0 

100.0 

60.2 

26.4 

22.5 

31.6 

19.5 

8.9 

21.3 

28.4 

24.2 

9.8 

7.5 

(25.9) 

49.8 

1,605.8 

~I Not adjusted for changes in dependency definition. 

50 

63.4 

38.2 

25.2 

36.6 

16.4 

20.2 

53.3 

24.6 

9.4 

30.5 

100.0 

100.0 

100.0 

62.1 

26.4 

22.7 

31.3 

19.6 

8.2 

20.8 

28.8 

24.0 

10.1 

8.1 

(27.8) 

49.6 

64.8 

39.0 

25.8 

35.1 

16.3 

IB.9 

52.0 

22.1 

8.6 

28.4 

95.5 

95.5 

95.5 

63.2 

27.4 

22.9 

30.3 

19.3 

7.7 

19.9 

29.4 

24.2 

10.5 

8.4 

(28.1) 

49.2 

1,767.8 I,B46.2 
Under current law, about 11.4 million persons would have 

been eligible for Title VI programs in 1975. Of these, about 53 

percent would have been eligible to participate in Title VI (b) 

PSE jobs. The eligibility rules under the Administration proposal would result in a seven-fold reduction (to 1. 6 million) 

in the total Title VI eligible group compared with current law; 

the Senate and House committee proposals would reduce the total 

eligible population nearly as much, to 1.8 million persons. 

The intent of the proposed changes in Title VI eligibility 

is to target PSE jobs better on disadvantaged labor force groups. 

A comparison of the eligible populations under the current Title 

VI(b) (the more targeted portion of the current Title VI), the 

Administration proposal, and the Senate and House committee 

proposals indicates that the Administration bill would change the 

character of the eligible population very little in some ways 

and considerably in others, compared with the current Title 

VI (b) • The number of eligibles would be reduced by about 73 

percent under the Administration proposal. The number of eligibles under the Senate version would be 10 percent greater and 

under the House version 15 percent greater than under the Administration bill. 

The Title VI eligibility rules in all three proposals would 

greatly reduce the size of the eligible population. They would 

also result in less targeting than exists under current Title 

VI(b) on individuals likely to have labor-market problems (except for unemployment experience). Compared with current Title 

VI (b), eligibles under the various Title VI proposals would be 

more likely to be high school graduates, whites, and males and 

less likely to be recipients of cash assistance benefits. In the 

case of the unemployed, the Administration proposal is best targeted on those with up to at least 5 weeks of unemployment while 

the House committee proposal would result in the largest proportion of eligibles with 15 or more weeks of unemployment. 

Since the Senate and House committee bills would extend 

eligibility to those with higher family incomes than would the 

Administration bill, the potential for skimming less needy persons from among those eligible would be somewhat greater under 

the two Congressional proposals. As indicated in Table 16, while' 

more than four out of five of those eligible for Title VI under 

any of the proposals would have had family incomes of less 

than $7,500 during the previous year, the proportion of eligibles 

from low-income families is somewhat higher under the Administration bill. Compared with the Administration bill, the 

51 
TABLE 16. FAMILY INCOMES OF TITLE VI ELIGIBLES UNDER CURRENT LAW, 

ADMINISTRATION, &~D SENATE AND HOUSE COMMITTEE PROPOSALS ~/: 

PERCENT DISTRIBUTION 

Family Income 

Last Year 

Less than $7,500 

$ 7.500 - 9,999 

$10.000 - 14,999 

$15.000 or more 

Current Administration 

Title VI(b) Bill 

83.6 93.9 

9.8 5.3 

5.2 0.8 

1.3 

Total (in thousands) 5,971.3 1,486.2 

SOURCE: CBO tabulation of the 1976 SIE. 

Senate 

Committee 

Bill 

87.2 

8.8 

4.0 

1,767.8 

~/ Not adjusted for changes in dependency definition. 

House 

Committee 

Bill 

82.4 

10.0 

6.7 

0.8 

1,846.2 

increase in the size of the eligible group that would occur 

under the higher income eligibility limit of the Senate bill 

would tend to be offset by the increase in the required length of 

unemployment duration. Income provides a better targeting 

criterion than unemployment duration. however, since the latter 

can be more easily affected by a potential participant who wants 

to qualify for program benefits. 

About 1.3 percent of eligibles had family incomes of $15.000 

or more under current Title VI(b) rules. compared with 0.8 

percent under the House committee proposal, and none under the 

proposed Senate and Administration rules. Given the range of 

income of those eligible under the House committee bill, the 

opportunity for serving less disadvantaged eligibles would be 

somewhat greater under its rules than under those of the other 

alternatives. Consequently, to target jobs on lower income eligibles under the House committee proposal, targeting goals and 

special emphasis would have to be established through administrative regulations. 

52 
The conclusions about PSE eligibility based on the proposed 

Title VI rules are changed little if consideration of Title II 

is included. Under the Senate committee bill, Title II PSE 

eligibles would have to be economically disadvantaged and unemployed at least 12 weeks. Roughly 1.0 million (17 percent) of 

the 6.4 million persons who would qualify for Title II programs 

under the rules of the proposed Senate committee bill would 

be eligible for PSE. Of those who would qualify for Title II 

programs under the Administration and House committee bills, 

about 1.5 million would also qualify for PSE jobs for the structurally unemployed. The combined size of the Title II and Title 

VI PSE eligible group under the Administration, Senate, and House 

bills (3.1 million, 2.8 million, and 3.3 million, respectively) 

would be considerably smaller than the number eligible for 

current Title VI (b) PSE jobs. At the same time, the eligibles 

under the proposed rules would, in general, not represent as 

disadvantaged a population as the eligibles under current Title 

VI(b) PSE. 

ENFORCING ELIGIBILITY REQUIREMENTS 

In CETA and other nonentitlement programs, the final mix 

of program participants is determined by the program operators; 

the effectiveness of eligibility restrictions depends ultimately 

on their application and enforcement. While the likelihood of 

skimming--the selection of program participants from among the 

best qualified eligibles--can be reduced by legislation that 

limits the size of the eligible population, some degree of 

skimming may be unavoidable. 

On the other hand, selection of ineligibles can be limited 

only by more active program supervision. Compared with any 

current cash assistance program, errors made in allowing ineligible participants into CETA programs can produce relatively 

larger per-participant budget costs and inequities. Since CETA 

benefits (public service wages, training stipends, and the 

like) do not vary with need, errors in assessing eligibility 

result in large per-participant outlays (as much as $11,500 in 

the case of public service employment). Additionally, since CETA 

is not an entitlement program, each job or training slot filled 

by an ineligible individual reduces the number of slots available 

to eligibles. 

A recent General Accounting Office (GAO) study of public 

service jobs indicates that approximately 10 percent of the 

53 
1,800 individuals working at sites surveyed by the Department of 

Labor many have been ineligible under current law. ~I If these 

error rates are indicative of the national situation, erroneous 

payments nationwide could approach $0.6 billion. 121 

According to the GAO report, the major cause of error 

in determining CETA eligibility was the reliance on participantsupplied information and the lack of standard verification 

procedures...!.!!.1 In addition, prime sponsors have little incentive for detailed eligibility screening because they are 

allowed 60 days, during which enrollees are working, to determine 

the eligibility of enrollees and there are no sanctions provided 

(such as requiring repayment of disbursements to ineligible 

individuals). l2.1 

12./ General Accounting Office, Information on the Buildup in 

Public Service Jobs (1978). 

III Based on $8,900 expenditure per year of service, the national average cost in Title VI programs during fiscal year 

1978. In 1976 approximately 5.3 percent of the 3.6 million 

AFDC families were found to be ineligib le. Erroneous 

payments to this group may have approached $0.66 billion 

based on an average benefit of $3,488 per four-person 

family. Congressional Research Service, Welfare Reform 

Background Paper (1977), pp. 12 and 86. 

~I Most eligibility determinations were found to be based 

on certification rather than verification of statements 

through the use of other sources. General Accounting 

Office, Information on the Buildup in Public Service Jobs, 

pp. 21-23. 

l2.1 In addition, many prime sponsors delegate responsibility 

for eligibility determination to state employment service 

offices, since this absolves them of legal responsibility 

for errors. For a discussion of Department of Labor enforcement deficiencies, see Carl E. Van Horn, "Implementing 

CETA: The Federal Role," Policy Analysis (1978), pp. 177-

80. 

54 
CHAPTER V. TARGETING CETA SERVICES ON GEOGRAPHIC AREAS 

The eligibility criteria specified in the various CETA 

programs are one element that determines the ability of the total 

program to serve those most in need of CETA services. CETA is 

not an entitlement program, however. Its ultimate effectiveness 

in matching employment and training opportunities with individuals needing services depends on the allocation mechanism used 

to distribute program funds among local areas. If formulas for 

geographic allocation are not consistent with eligibility criteria, some areas will be underserved while others will be 

overserved in relation to need. The question then is, how can 

CETA funds be effectively focused on geographic areas with high 

levels of need? 

DEFINING GEOGRAPHIC AREAS 

Defining geographic areas as needing more employment and 

training assistance presents several problems. Certain areas are 

thought to be in need because they lack resources or because 

their residents have higher rates of unemployment, lower income, 

and poorer future employment prospects. The definitions of needy 

areas differ among federal programs; for one program the unemployment level must be 6.5 percent for three consecutive months, 

while for another the rate must exceed 4.5 percent. 

For purposes of current CETA program operations, geographic 

areas are defined in three ways: 

o Prime sponsor areas (the basic units for program operation) are generally states or units of general purpose 

local government wi th populations of at leas t 100,000. 

o "Areas of substantial unemployment" (ASUs) are contiguous areas within prime sponsor jurisdictions; they 

must have at least 10,000 persons, have had an unemployment rate of 6.5 percent or higher for three consecutive 

months, and qualify for at least $25,000 of Title II 

support. 

55 
o Program agents are units of general purpose local government (or combinations of such units) with populations of 

50,000 or more and containing ASUs that are empowered to 

administer CETA funds allocated to ASUs. ~/ 

All prime sponsor units are eligible to participate in 

programs under the various CETA titles except Title 11, which is 

limited to areas of substantial unemployment. During fiscal year 

1978, there are 450 prime sponsors and 201 ASUs. 1/ 

IMPACT OF CURRENT GEOGRAPHIC ELIGIBILITY CRITERIA 

A recent Treasury Department study of the effectiveness of 

various programs in the Economic Stimulus Appropriations Act of 

1977 concluded that of the three programs--Antirecession Fiscal 

Assistance (revenue-sharing), Local Public Works, and CETA public 

service employment--GETA PSE funds were the least related to the 

degree of local government fiscal hardship in the 48 cities 

studied (see Table 17). 1/ The relatively poor geographic targeting of CETA PSE funds in relation to economic hardship of 

governments is caused by several factors related to the definition of formula elements. 

Unemployment Rate. Funds would be more targeted if the 

unemployment allocation factor measured relative severity more 

heavily than straight unemployment. A distribution based on 

l/ P.L. 93-203, Section 204 (d)(l). 

1./ The ASUs are those that do not qualify in whole as prime 

sponsors. The number of program agents is difficult to 

determine since program agents may be prime sponsors for more 

than one area. 

1/ "Hardship" is a composite definition that includes measures 

of population change, changes in per capita income, own 

source revenues, outstanding long-term debt, and property 

values for local government jurisdictions. Those jurisdictions affected by long-term structural problems including 

unemployment would presumably score higher in this scheme; 

U.S. Treasury Department, Office of State and Local Finance, 

Report on the Fiscal Impact of the Economic Stimulus Package 

on 48 Large Urban Governments (1978). Economic hardship is 

only one criterion for evaluating the targeting of program 

funds. 

56 
TABLE 17. ECONOMIC STIMULUS APPROPRIATIONS TO 48 CITIES BY DEGREE OF FISCAL 

DISTRESS, FISCAL YEAR 1978 

Degree of 

Fiscal CETA 

Distress High Med. Low 

Percent of 

Funds 46.4 40.5 13.0 

Relative per 

Capita Amount 

(average 

100.0) 110.5 98.1 79.5 

Relative 

Percent 

of Own 

Source 

Revenues 

(average .. 

100.0) 81.0 124.1 137.9 

ARFA al LPW bl 

High Med. Low High Med. Low 

66.6 27.4 6.0 54.9 37.0 8.1 

158.8 66.6 36.9 130.7 89.5 49.5 

119.0 85.7 61.9 90.2 122.0 97.6 

SOURCE: U.S. Treasury Department, Office of State and Local Finance, 

Report on the Fiscal Impact of the Economic Stimulus Package on 

48 Large Urban Governments (1978). Appendix A. 

~/ Antirecessionary Fiscal Assistance. 

~I Local Public Works. 

57 
unemployment in excess of a threshold defined in absolute terms 

(for example, above 4.5 or 6 percent) will be more or less targeted as the national unemployment rate changes. A better targeting device might be one that defines as eligible those areas 

whose rates exceed the national average rate of unemployment by 

a given amount; for example, those areas with rates above the 

national rate or those with rates more than 10 percent above the 

national average. 

Time Period. Under the current CETA law, areas of substantial unemployment are defined as those with unemployment rates of 

6.5 percent or above for any three consecutive months during the 

previous year. As a consequence, many areas may qualify as ASUs 

because of seasonal factors that have little relation to their 

overall long-run unemploy~ent experience. if 

The CETA bills of the Administration and the Senate and 

House committees would alter the time dimensions of the current 

definition of ASUs. The Administration bill would require that 

the average unemployment rate of 6.5 percent or above apply to 

the preceding 12 months, rather than to any 3 consecutive months 

in the preceding year. The Senate committee bill would do the 

same, but it would let the current definition apply during fiscal year 1979. The House committee bill would require a 12-

month time period for Title VI programs but would retain the 

current 3-month period for Title II programs. 

Under current definitions, approximately 535 areas would 

qualify: 202 ASU prime sponsors and 333 ASUs within prime 

sponsor areas. Based on 1977 annual average unemployment rates, 

adoption of the Administration or the House committee's Title VI 

definition would immediately decrease the number of qualifying 

areas from 535 to 455. The Senate and House Title II definitions 

would maintain the number of qualifying units at 535 (Table 18). 

The size of the decline in the number of eligible units as 

a result of the change in definition is largely a function of the 

high national rates of unemployment during calendar year 1977. 

If the national unemployment rate declines as projected over the 

authorized period of the bills through fiscal year 1982, so would 

if This problem is somewhat lessened during periods of high 

national unemployment rates such as the United States has 

been experiencing recently. 

58 
TABLE 18. AREAS ELIGIBLE FOR CETA FUNDS UNDER CURRENT AND 

PROPOSED ASU DEFINITIONS, FISCAL YEAR 1979 

Total ASU prime ASUs within prime 

Definition ASUs sponsors sponsor areas 

Current Definition 535 202 333 

Proposed Definition 

Administration 455 202 253 

Senate committee 535 202 333 

Hou~e committee 

Title II 534 202 333 

Title VI 455 202 253 

SOURCE: Unpublished data from the Bureau of Labor Statistics 

and Employment and Training Administration, based on 

the assumption that 1977 annual average unemployment 

rates will be used to define eligible units. 

the number of eligible units; the decline would be greater under 

any of the new definitions than under the current definition. 

The Senate committee bill would effectively continue the current 

definition until fiscal year 1980. It is likely, however, that 

whichever bill is passed, some existing areas would be redefined 

in order to qualify under the new rules; the extent to which this 

would occur is difficult to predict. 

Area Size. Currently, the size of an ASU under CETA is 

10,000 population or more. The CETA ASU definition represents 

one extreme among the definitions used in current antirecession 

programs; it is not based on a labor-market area or political 

entity, and the population size is small. Under various other 

countercyclical programs, areas of high unemployment or labor 

surplus are units of local governments (as in the Antireces59 
sionary Fiscal Assistance program) and Standard Metropolitan 

Statistical Areas (as in Defense Manpower Act programs). 21 

Under the current definition of an ASU, each of the 20 

largest Standard Metropolitan Statistical Areas (SMSAs) contains 

at least one area that would receive CETA funds on the basis of 

1977 average unemployment rates. If the size of an ASU under 

CETA were changed to a SMSA, 16 of the 20 largest SMSAs would 

continue to qualify for CETA funds on the basis of an annual 

average rate of unemployment of 6.5 percent or more. ~I 

CURRENT GEOGRAPHIC ALLOCATION FOR~ruLAS 

Approximately 71 percent ($9.2 billion) of CETA's appropriations for fiscal years 1977 and 1978 will be allocated by 

formula; where 90 percent ($6.2 billion) of Title VI funds and 80 

percent ($1.5 billion) of Title I funds are distributed by 

formula. The formula amounts and the elements used for allocating 

funds under the various titles are shown in Table 19. 

Data accurately representing the geographic distributions 

of individuals intended to be served by CETA programs are not 

available on a current basis, so proxy measures are used. In 

some cases, the measures used may not accurately reflect the 

dimensions of the problem. For example, funds intended to 

ameliorate youth unemployment problems are generally allocated 

on the basis of adult unemployment rates and other factors, since 

geographically detailed data on youth are not available. Similarly, unemployment data used to allocate PSE funds may not 

il The Job Opportunities Program uses the current CETA definition of an area, but limits eligibility to those whose 

unemployment rate exceeds the national average for the most 

recent calendar quarter. 

~I Those areas not eligible on a SMSA-wide basis would be Minneapolis-St. Paul, Dallas-Ft. Worth, Cleveland, and Houston. 

The areas that would qualify are New York, Chicago, Los 

Angeles, Philadelphia, Detroit, Boston, San Francisco, 

Washington, Nassau-Suffolk County (New York), St. Louis, 

Pittsburgh, Baltimore, Newark, Atlanta, Anaheim-Santa Ana, 

and San Diego. 

60 
TABLE 19. CETA ALLOCATION BY FORMULA ELEMENTS AND AMOUNTS: 

IN MILLIONS OF DOLLARS AND PERCENT DISTRIBUTION, 

APPROPRIATIONS FOR FISCAL YEARS 1977-1978 ~I 

Formula Element Amount Percent of 

Title and Weight Formula Funds 

Title I Prior year's allotment --

50 percent 752 8.2 

Nu~ber of unemployed 

37.5 percent 564 6. 1 

Number of adults in lowincome families -- 12.5 percent 188 2.0 

Total Title I -- 100 percent 1,504 16.3 

Title II Relative number of un- 1,540 16.7 

employed in areas of 

substantial unemployment 

100 percent 

Title VI Number of unemployed 

50 percent 3,081. 2 33.5 

Number of unemployed 

residing in areas of 

substantial unemployment. --

25 percent 1,540.6 16.7 

Number of unemployed 

in excess of 4.5 percent 

of labor force in prime 

. sponsor area -- 25 percent 1,540.6 16.7 

Total Title VI -- 100 percent 6,162.3 66.7 

SOURCE: U. S. Department of Labor, Employment and Training 

Administration, Office of Administration and Management. 

~I CETA appropriations were forward-funded under the Economic 

Stimulus Appropriations Act of 1977. 

61 
indicate the extent of joblessness in rural areas or urban 

ghettos, where residents may have left the labor force because 

they believe jobs are not available. 

Among the various CETA titles, roughly 8 percent of the 

allocations for fiscal years 1977 and 1978 were based on the 

prior year's funding level, 2 percent on the relative number of 

adults in low-income families, and nearly 90 percent on the 

area's share of unemployed persons. 

The Administration proposal, while providing a more targeted 

definition of ASU, would distribute funds based on the current 

Title VI formula. The Senate and House committee bills would 

require that funds for structural PSE be allocated on the basis 

of formulas proposed for Title II. The House formula would 

include such factors as the relative number of low-income adults, 

prior year's funding, and relative number of unemployed. The 

Senate formula for distributing THle II PSE funds contains the 

same elements as the current Title VI formula but assigns different weights to the various elements (Table 20). The Administration and Senate committee formulas would tend to favor suburban 

areas and small cities more than the House formula for Title II 

because of the weights given to the relative number of unemployed. 

ALTERNATIVE ALLOCATION FORMULAS 

The current Title VI allocation formula would be retained 

under all three CETA proposals. The Administration bill would 

also retain current Title I allocation criteria for distributing 

funds under the new Title II. The Senate and House committee 

bills would involve substantially different Title II allocation 

formulas. 

The difference between the Title II and Title VI allocation formulas is important. Under the Administration bill, 

funds for the base level of PSE jobs ($1 billion) would be 

distributed on the basis of the current Title VI formula. The 

Senate and House committee bills would require that the funds 

for structural PSE be allocated on the basis of their proposed Title II formulas. Based on current definitions of prime 

sponsors and ASUs, the Senate bill would tend to target larger 

amounts of structural PSE funds in the Northeast, whereas the 

Administration bill would target more funds to the Midwest. 

62 
'" 

. 

'" '" .., 

o 

.., 

'" 

TABLE 20. CETA TITLE II AND VI ALLOCATION FORMULA ELEMENTS AND WEIGHTS UNDER ADMINISTRATION, AND SENATE AND HOUSE COMMITTEE BILLS 

Title 

Title II 

Title VI 

Administration 

bill 

Prior year's allotment --

50 percent 

Number of unemployed 

37.5 percent 

Number of low-income 

adults 12.5 percent 

Number of unemployed 

50 percent 

Number of unemployed 

residing in areas of 

substantial unemployment -- 25 percent 

Number of unemployed 

in excess of 4.5 percent of labor force 

in prime sponsor area 

25 percent 

Formula Element and Weight 

Senate 

committee 

bill 2.1 

Section A. B. and C 

Prior year's allotment 

50 percent 

Number of unemployed 

37.5 percent 

Section D 

Number of unemployed 

33.3 percent 

Number of unemployed 

residing in areas of 

substantial unemployment -- 33.3 percent 

Number of low-income Number of /unemployed 

adults 12.5 percent in excess'O{4.5 

percent of labor force 

in prime sponsor area --

33.3 percent 

Number of unemployed 

50 percent 

Number of unemployed 

residing in areas of 

substantial unemployment - 25 percent 

Number of unemployed 

in excess of 4.5 percent of labor force in 

prime sponsor area --

25 percent 

2.1 Non-PSE Title II funds would be distributed using thB formula in colum., 1. 

House 

committee 

bill 

Prior year's allotment --

33.3 percent 

Number of unemployed 

25 percent 

Number of low-income 

adults 8.3 percent 

Number of unemployed 

residing in areas of 

substantial unemployment -- 33.3 percent 

Number of unemployed 

50 percent 

Number of unemployed 

residing in areas of 

substantial unemployment -- 25 percent 

Number of unemployed 

in excess of 4.5 percent of labor force in 

prime sponsor area --

25 percent 
The House bill targets relatively more funds to the South, and 

the Senate bill to the West (Table 21). Based on this data, none 

of the formulas is clearly superior in targeting structural PSE 

funds on those regions most in need. 

As shown in Table 22, large northeastern cities (for example, New York) would fare considerably better under the Senate 

committee bill, because of high unemployment rates in these 

areas. Poor rural areas such as those in Louisiana and Virginia would apparently do better under the House committee bill; 

of the three proposals, the House bill would also provide the 

largest share of funds to relatively wealthy counties (such as 

Montgomery County, Maryland). 

None of the CETA proposals is perfect in addressing the 

needs of the structurally unemployed during periods when the 

unemployment rate is not high enough to "trigger in" countercyclical public service jobs under Title VI. All of the bills 

would target some funds to areas in which structural unemployment 

is not most prevalent. The Administration bill, using the 

current Title VI formula, would tend to distribute funds most 

broadly and hence concentrate them least on areas of long-term 

need. The Senate committee bill would tend to concentrate funds 

in large cities with high levels of unemployment. The House 

committee bill would target less on these cities and would increase the share of funds allocated to relatively well-off areas. 

To the extent that Title II is intended to be a structural 

program and Title VI a cyclical program, differences in the 

allocations to various areas under the two programs are desirable. 

64 
TABLE 21. ILLUSTRATIVE ALLOCATIONS OF $1 BILLION IN STRUCTURAL PSE FUNDS UNDER 

ADMINISTRATION, AND SENATE AND HOUSE COMMITTEE BILLS: AMOUNTS IN 

MILLIONS OF DOLLARS AND PERCENT DISTRIBUTION 

Formula Amount 

Administration Senate al House bl 

Region Amount Percent Amount Percent Amount Percent 

Northeast 318.2 31.8 323.2 32.4 291.4 29.1 

Midwest 266.5 26.7 217.1 21.7 226.6 22.7 

South 220.1 22.0 256.4 25.6 288.4 28.8 

West 195.2 19.5 203.4 20.3 193.5 19.4 

Total 1,000.0 100.0 1,000.0 100.0 1,000.0 100.0 

SOURCE: U.S. Department of Labor, Employment and Training Administration, Office of 

al 

Administration and Management. 

Senate 

Senate 

1979. 

Title 

committee allocations assume ASU definition based on three-month average; 

bill would continue current three-month definition only in fiscal year 

Senate committee bill requires $3 billion for Title II PSE positions before 

VI positions can be funded. 

bl House committee bill requires that $4 billion be spent on Title II programs and 

limits spending on PSE and work experience to 50 percent of Title II funds. 
TABLE 22. ILLUSTRATIVE ALLOCATIONS OF $1 BILLION TO VARIOUS PRIME SPONSORS UNDER 

STRUCTURAL PSE PROGRAMS: AMOUNTS IN THOUSANDS OF DOLLARS AND PERCENT 

DISTRIBUTION 

Administration Senate House 

Prime Sponsor Amount Percent Amount Percent Amount 

New York City 43,678.2 4.4 44,562.5 4.5 43,555.4 

Houston, Texas 3,660.9 0.4 3,315.1 0.3 4,391.6 

Montgomery County, 

Maryland 669.3 0.1 446.2 0.0 845.4 

Balance of State, 

Louisiana J!! 6,750.9 0.7 7,075.6 0.7 7,782.6 

Prince William 

County, Virginia 188.0 0.0 142.5 0.0 211.3 

SOURCE: Unpublished data, U.S. Department of Labor, Employment and Training 

Administration, Office of Administration and Management. 

J!! Portion,of Louisiana not represented by other prime sponsors. 

Percent 

4.4 

0.4 

0.1 

0.8 

0.0 
CHAPTER VI. COORDINATION AND INTEGRATION OF THE DELIVERY 

OF EMPLOYMENT AND TRAINING SERVICES 

The CETA delivery system of many local government and nonprofit organizations exists side-by-side with other employment 

and training delivery systems. The Employment SerVice, the Work 

Incentive (WIN) program, and some private employers provide 

various services that overlap those provided by CETA. The 

issue that needs to be addressed in the CETA reauthorization is 

whether better coordination of these various systems can be 

attained. 

Coordination might better serve those eligible for service 

and reduce overall budget costs by eliminating unnecessary 

duplication. Moreover, the possible enactment of welfare reform 

legislation such as the Administration proposal (H.R. 9030) or 

the House Welfare Reform Subcommittee bill (H.R. 10950), which 

would substantially alter the existing CETA program, suggests 

that coordination of employment and training services is crucial. 

Another issue concerns community-based organizations (CBOs) 

that provide CETA services to a specialized clientele. Community-based organizations have received increases in CETA 

funding every year since the program's enactment in 1973. 

The desirability of the trend to increased funding for these 

organizations should be measured against the degree to which they 

provide services to those who would otherwise be served poorly, 

if at all by other CETA agencies. 

The appropriate level of private sector involvement in 

employment and training programs is another major issue. Private 

sector involvement in federal programs designed to provide 

on-the-job training and other manpower services has typically 

varied directly with the level of overall economic activity. In 

considering alternatives that might change the public-private 

mix of delivery systems, attention should be given to the reliability of private sector involvement over the business cycle, the 

relative net budget cost of private sector involvement, and the 

degree to which the target population is served by private sector 

systems. 

67 
CETA/EMPLOYMENT SERVICE COORDINATION 

The U.S. Employment Service (ES) of the Department of Labor 

is a system of state-administered public employment agencies. A 

network of more than 2,400 local offices provides a variety of 

services including testing, counselling, job referral, and 

training. The implementation of CETA programs and the development of a network of prime sponsors have changed the Employment 

Service's role; formerly the primary deliverer of manpower 

services, ES is now only one of several agencies providing such 

services .-1.../ 

Although the ES is involved in the administration of CETA 

programs through its membership (ex officio in many cases) on 

various state councils charged with coordinating. statewide manpower services, its role in providing services varies greatly 

from one jurisdiction to another. In some areas, the ES is a 

contractual provider of eligibility certification services. In 

other areas, ES contracts with CETA prime sponsors to make 

training allowance payments, provide job development or placement 

services, or operate on-the-job training and work experience 

programs. 1/ The decision about whether to obtain services 

from ES is left largely to the discretion of prime sponsors. In 

some cases, CETA prime sponsors and the ES have overlapping 

responsibilities and jurisdictional disputes have developed. 

Some provisions of the Administration's CETA reauthorization bill would add to the existing confusion about the roles 

of CETA and the ES and could add to the overlap of services. 

Under Title III, a program to provide job search and relocation 

assistance would be established as a national program. 1/ Also, 

Title II (Section 205) would create a program of job search 

II William Mirengoff and Lester Rindler, The Comprehensive 

Employment and Training Act, pp. 103-7. The change in the 

Employment Service's role occasioned by the pa~sage of CETA 

was one instance in a lengthy history of redefinition of the 

activities, responsibilities, and authority of ES. 

11 u.s. Department of Labor, The Employment Service: An Institutional Analysis, R&D Monograph 51 (1977). 

11 This program is not new but the existing one described in 

Section 311(e) of the current law. 

68 
assistance to be provided by local service deliverers. Included 

in these services would be intake, eligibility determination, use 

of computerized job matching, assessment, counseling, job search 

assistance grants, and relocation assistance grants. Except for 

computerized job matching (which, if it is available, must 

be arranged through agreements with the ES), these services can 

be provided by the ES or by other public or private nonprofit 

organizations. 

The Senate and House committee bills would make no change in 

the respective roles of prime sponsors and state employment 

security agencies, although they would add a relocation assistance program that presumably could be run by either prime 

sponsors or the ES. 

There have been several proposals to coordinate the roles of 

the ES and CETA bette r, but none has been enac ted. The most 

prominent recent example is the Steiger proposal (H.R. 9358, 

introduced in September 1977) to merge the ES and CETA systems. 

Under this proposal ultimate responsibility for program oversight 

would rest with the state governor, who would review and approve 

prime sponsor plans and distribute funds. The presumption 

underlying the Steiger proposal is that state-level control would 

lead to better coordination of CETA and ES activities. Although 

the Steiger proposal is not a full substitute for CETA--because 

it omits public service employment, Job Corps, and YACC programs 

--the proposal clearly raises the issues of coordination and 

control, which have not been addressed to date. if 

ROLE OF COMMUNITY-BASED ORGANIZATIONS 

Community-based organizations usually provide services 

to CETA participants who are disadvantaged members of the labor 

force. Before CETA, contracts were directly channeled from the 

Department of Labor to the various organizations--for example, 

National Urban League (NUL), the Opportunities Industrialization 

Center (OIC), and Services, Employment, Redevelopment (SER)fJobs 

for Progress. Current law designates as eligible those community-based organizations providing "programs of demonstrated 

if The Senate committee report on CETA would require the Secretary of Labor to make a report on recommendations for reform 

of the Wagner-Peyser Act by February 1, 1979. 

69 
effectiveness." The reauthorization proposals would add unionrelated organizations and employer-related nonprofit organizations to those organizations eligible under current law. 11 

As is the case with CETA and the ES, there 1s no consistent 

relationship between CETA prime sponsors and community-based 

organizations. Unlike the ES, community-based organizations 

provide a range of employment and training services, in many 

cases to individuals who might otherwise not be served. Since 

community-based organizations often serve certain racial or 

ethnic client groups, CETA regulations that require broad groups 

of participants be served by each program provider may be inappropriate. The reauthorization bills would provide an expanded 

national program to serve individuals handicapped by limited 

English-speaking ability and would give increased emphasis to 

serving the disadvantaged. These provisions would increase the 

importance of the role performed by community-based organizations 

by emphasizing services to the particularly disadvantaged. The 

House committee bill would expand the list of community-based 

organizations permitted to operate CETA programs to include 

"neighborhood organizations" that are neighborhood-based and not 

affiliated with national organizations. 

COORDINATION OF CETA WITH WELFARE REFORM 

While many recent legislative proposals would affect the 

operation and scope of CETA· activities, perhaps the most important changes would result from the enactment of the Administration's welfare reform proposal (H. R. 9030), the House Welfare 

Reform Subcommittee's bill (H.R. 10950), or one of the incremental proposals such as the Ullman proposal (H.R. 10711) or 

the Baker-Bellmon proposal (S. 2777). The comprehensive welfare 

reform bill (H.R. 10950) passed by the special House Welfare 

Reform Subcommittee includes a provision for giving public service employment to welfare recipients after a period of five 

weeks of intensive job search activity. 

There are conflicts among the various CETA bills and welfare 

reform proposals introduced in the 95th Congress with regard to 

11 These include, but are not limited to, NUL, OIC, SER, Mainstream, Community Action Programs, and Community Development 

Corporations. 

70 
eligibility, allowable wage levels, and tenure in public service 

employment. Under the Administration's proposed CETA reauthorization bill, eligibility for new Title II public service employment would be restricted to economically disadvantaged, unemployed, or underemployed individuals. The jobs would be limited 

to a maximum salary of $8,000, and no wage supplementation from 

other sources would be allowed. Tenure would be limited to 18 

months. 

Under H.R. 9030, the Administration's welfare reform proposal, public service jobs would be available to only the primary 

wage-earner in a family with children. H.R. 10950 contains a 

similar eligibility criterion. PSE participation under H.R. 9030 

would be limited to 52 consecutive weeks, while H.R. 10950 would 

impose an 18-month tenure limitation. 

The House committee CETA bill would limit Title II PSE participation to those with family incomes below 70 percent of 

the BLS lower living standard who have not been employed more 

than 200 hours dur ing the previous 10 weeks. Under this bill, 

the maximum allowable federal wage level for Title II PSE would 

be $10,000, adjusted upwards by the ratio of the local average 

wage to the national average wage to a maximum of $12,000 (20 

percent). No supplementation of this wage would be allowed. 

The Senate committee CETA bill would limit eligibility for 

Title II PSE to those who are economically disadvantaged and 

unemployed at least 12 weeks. The wage level and supplementation 

provisions are identical to those in the House committee bill. 

Title VI wages under the Senate bill could not exceed $14,400 

including local supplementation. if 

The allowable wage levels under the CETA proposals appear to 

conflict with the limits in the various welfare reform proposals. 

The current maximum salary under CETA is $10,000; the Administration's CETA bill retains this maximum for Title VI (countercyclical) public service jobs. Under H.R. 10950, the maximum 

wage level would be $9,600 in fiscal year 1981, indexed by the 

ratio of an area's average wage to the national average wage. In 

a high-wage area such as New York City, the maximum wage for 

welfare jobs under H.R. 10950 would be $10,560. 

if Individuals who were PSE participants as of October 1; 1978, 

would be able to retain their previous CETA wages. 

71 
Only in high-wage areas would the maximum allowable wages 

for welfare eligibles under the comprehensive welfare reform 

bills approach the maximum allowed under the various CETA reauthoriza tion proposals; in lower-wage areas, the maximum CETA 

wage would generally be considerably higher than the maximum wage 

for welfare jobs. This could create dual wage levels for the 

same types of jobs in some areas, although areas with lower 

average wages are not likely to pay the maximum CETA wage, 

lessening the possibility of divergence between CETA wages and 

welfare wages. On the other hand, the differences in eligibility, 

limits on length of participation, 21 and allowable wage rates 

between CETA PSE and welfare jobs could cause considerable 

confusion for participants and program operators. 

PRIVATE SECTOR DELIVERY OF CETA SERVICES 

The federal government has offered monetary incentives in 

the form of tax credits and direct subsidies to private employers to provide training and other employment services. The 

current employment tax credit, which expires December 31, 1978, 

allows an employer to reduce his corporate income tax liability 

by 50 percent of the increase in his unemployment insurance wage 

base above 102 percent of the previous year's base. ~I 

21 The Administration's welfare reform proposal would require 

that individuals engaged in special public service jobs be 

referred back to a job search program after a period of one 

year of continuous work. Under the House and Administration 

CETA bills, participants in PSE programs would be limited to 

78 weeks of participation in any three-year period. No 

more than 26 weeks of employment before October 1, 1978, 

could be counted towards the maximum allowable time, although 

the Secretary of Labor could waive the overall limit under 

certain circumstances. 

Under the Senate committee bill, individuals in Title II PSE 

programs would be limited to 78 weeks of participation in any 

five-year period; under Title VI, a 52-week limit would 

apply. Those employed before October 1, 1978, would have a 

maximum of 26 weeks of prior participation counted towards 

the time limit. The Secretary would have discretion to 

waive the limit for up to six months under exceptional 

circumstances. 

~I The Tax Reduction and Simplification Act of 1977. 

72 
The Administration's recent Urban Initiative proposal would 

give a new tax credit for hiring disadvantaged youth 18-24 years 

old, and Senator Jacob Javits of New York has proposed a tax 

credit for hiring youth 16-19 years old who have been unemployed 

or enrolled in CETA for 15 weeks or more (S. 2436). In addition, 

the CETA reauthorization bills would create, under Title VII, 

Private Sector Initiatives providing financial assistance to 

prime sponsors that involve private businesses and labor organizations in job placement and training. 

Stability of Delivery by the Private Sector 

Tax credits and other forms of subsidies are designed to 

increase the relative attractiveness of hiring or training 

disadvantaged workers by reducing their net cost to employers. 

Experience with NAB-JOBS and other private sector programs 

indicates that the participation of profit-seeking employers in 

these programs is likely to vary directly with the level of 

aggregate economic activity. if If government training and 

employment were planned to vary inversely with aggregate economic 

activity (and thus private sector involvement), more emphasis 

could be shifted to private sector providers during periods of 

good overall economic conditions. 

Target Groups Served by Private Employers 

Since private employers are motivated in part by profit 

considerations, it is possible that they will skim the better 

qualified and therefore less costly participants from among the 

eligible. This practice could result in higher costs for public 

sector employment and training programs, which would be left to 

serve a more disadvantaged clientele. If as some believe, private sector efforts are more likely than public sector programs 

to lead to unsubsidized private sector employment, the net gains 

from this strategy may outweigh the costs. 

if Committee for Economic Development, Jobs for the Hard-toEmploy: New Directions for a Public-Private Partnership 

(New York: C.E.D. 1978), pp. 39-40. 

73 
Relative Costs and Benefits 

The relative cost of providing private and public jobs and 

training opportunities is difficult to estimate. To the extent 

that private employers are subsidized for hiring, training, and 

placing employees they would have served anyway, fiscal substitution or windfall gains may occur. Fiscal substitution reduces 

the net job creation potential of both public and private employment programs. The Administration estimates that its newly 

proposed employment tax credit would result in net losses in 

corporate tax revenues of $1.4 billion. The employment-creation 

effects of such schemes are highly uncertain. lQ/ 

Accountability 

Recent press accounts of the abuse and misuse of CETA funds 

have led some critics to argue that greater central administrative control and accountability are needed. In response, the 

Department of Labor has announced the creation of a Special 

Investigations Unit to investigate charges of fraud and abuse. 

While there are 450 prime sponsors that provide CETA services, 

employment tax credits are available to an estimated 4.6 million 

private firms. 

Placing responsibility for eligibility determination with 

CETA prime sponsors and/or the ES may help to assure that bona 

fide eligibles are served, but none of the proposed bills addresses this issue. 11/ There is, however, no existing federal 

agency whose scope permits auditing the operations of private 

firms to assure that fiscal substitution and labor displacement 

do not occur and that training does occur. 

lQ/ Congressional Budget Office, Employment Subsidies and Employment Tax Credits (1977). 

11/ Although each of the proposed bills would establish recordkeeping requirements and auditing and investigation procedures, no agency is given explicit responsibility for the 

certification of persons eligible for CETA programs. 

74 
Summary 

Ultimately, the mix of public and private sector initiatives 

in employment and training will be determined by a combination of 

economic and other factors. It may be that these factors will 

dictate a new role for private sector involvement. In view of 

the relative reliability of public and private sector involvement 

over the business cycle, however, the choice of an increased 

private sector role should be made in full recognition of its 

limitations during economic downturns. 

75 

APPENDIX 
....., 

00 

TABLE A-I. SUMMARY OF SELECTED EMPLOYMENT AND TRAINING PROGRAM DATA, FISCAL YEAR 1977 

Total Cost per Cost 

Outlays Average Year of per 

(in millions Years Length Adjusted Service Participant 

Program of dollars) Service Stay (years) Participants ~I (in dollars) (in dollars) 

CETA, Title I 1,756 430,100 0.36 1,173,700 4,027 1,471 

CETA, Title III--

Migrants and Seasonal 

Farmworkers 61 4,800 0.18 26,700 12,700 2,280 

CETA, Title III--

Native Americans 52 17 ,000 0.44 38,700 3,036 1,344 

CETA, Title 111--

Summer Youth Program 575 250,000 0.25 1,000,000 2,380 595 

CETA, Title IV--

Job Corps 202 21,000 0.45 46,700 9,599 4,317 

CETA, Titles VI and II 2,836 336,600 0.53 637,200 8,429 4,449 

Community Serv~ce 

Employment for 

Older Workers 72 17.400 2.0 8,700 4,282 8,563 

Work Incentive 

Program 12.1. 360 37,226 0.35 114,345 9,670 3,150 

SOURCE: Unpublished U.S. Department of Labor data. 

~I Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

12.1 The average cost per participant and service year for the WIN program are not strictly 

comparable to CETA data. 
'" 

· cD 

'" '" 0 

'" · '" 

· '" 

...... 

\Q 

TABLE A-2. SELECTED EMPLOYMENT AND TRAINING PROGRAM COSTS PER YEAR OF SERVICE IN FISCAL YEAR 1977: 

IN DOLLARS 

Activities 

On-the- C1ass- Public 

job room Work service 

Programs training training experience employment Other Total 

CETA, Title I 4,696 4,371 3,420 8,729 4,273 4,027 

CETA, Title III 

Migrants and Seasonal 

Farmworkers 4,222 4,903 7,125 NA NA 12,700 

Native Americans 4,200 3,150 2,216 7,915 1,831 

Summer Youth Program 0 0 2,380 0 0 

CETA, Title IV--Job Corps 0 9,599 0 0 0 

CETA, Titles VI and II ~I 2,628 1,495 8,500 8,465 3,736 

Community Service Employment for Older Americans 0 0 4,282 0 0 

Work Incentive Program kl 9,250 3,656 3,680 14,766 NA 

NA Not applicable. 

~I An emergency supplemental appropriation merged Titles II and VI of CETA for the purpose of 

extending Title VI positions beyond the Title VI expiration date of December 31, 1975. 

~I The average cost per participant and service year for the WIN program are not strictly 

comparable to CETA data. 

3,036 

2,380 

9,599 

8,429 

4,282 

9,670 
00 

0 

TABLE A-3. SELECTED EMPLOYMENT AND TRAINING PROGRAM COSTS PER PARTICIPANT IN FISCAL YEAR 1977: 

IN DOLLARS 

Activities 

On-the- Class- Public 

job room Work service 

Programs training training experience employment Other 

CETA, Title I 1,989 1,617 1,197 3,927 1,286 

CETA, Title III 

Migrants and Seasonal 

Farmworkers 926 835 1,295 NA NA 

Native Americans 2,002 1,373 973 3,430 568 

Summer Youth Program 0 0 595 0 0 

CETA, Titles IV - Job Corps 0 4,317 0 0 0 

CETA, Titles VI and II ~/ 1,457 340 5,107 4,486 834 

Community Service Employment for Older Americans 0 0 8,563 0 0 

Work Incentive Program ~/ 3,237 1,089 513 8,179 NA 

NA = not applicable. 

~/ An emergency supplemental appropriation merged Titles II and VI of CETA for the purpose of 

extending Title VI positions beyond the Title VI expiration date of December 31, 1975. 

~/ The average cost per participant and service year for the WIN program are not strictly 

comparable to CETA data. 

Total 

1,471 

2,280 

1,344 

595 

4,317 

4,449 

8,276 

3,150 
(XI 

..... 

TABLE A-4. SELECTED EMPLOYMENI AND TRAINING PROGRAM OUTLAYS IN FISCAL YEAR 1977: IN MILLIONS OF 

DOLLARS 

Activities 

On-the- Class- Public 

job room Work service 

Programs training training experience employment Other Total ~I 

CETA, Title I 225 685 713 119 14 1,756 

CETA, Title III 

Migrants and Seasonal 

Farmworkers 4 15 6 0 36 61 

Native Americans 3 14 23 12 ~/ 52 

Summer Youth Program 0 0 575 0 0 575 

CETA, Titles IV - Job Corps 0 202 0 0 0 202 

CETA, Titles VI and II £/ 1 2 92 2,738 3 2,836 

Community Service Employment for Older Americans 0 0 72 0 0 72 

Work Incentive Program 106 ---1i 68 122 360 

Total ~I 339 968 1,495 2,937 175 5,914 

~/ Rows or columns may not sum to totals because of rounding. 

k/ Less than $0.5 million. 

£1 An emergency supplemental appropriation merged Titles II and VI of CETA for the purpose of 

extending Title VI positions beyond the Title VI expiration date of December 31, 1975. 
00 

N 

TABLE A-5. SELECTED EMPLOYMENT AND TRAINING PROGRAM YEARS OF SERVICE IN FISCAL YEAR 1977 

Activities 

On-the- Class- Public 

job room Work service 

Programs training training experience employment Other Total ~I 

CETA, Title I 47,900 156,700 208,500 13,700 3,300 430,100 

CETA, Title III 

Migrants and Seasonal 

Farmworkers 900 3,100 800 0 0 4,800 

Native Americans 700 4,400 10,200 1,500 200 17,000 

Summer Youth Program 250,000 250,000 

CETA, Title IV - Job Corps 0 21,000 0 0 0 21,000 

CETA, Ti tles VI and II '!!../ 500 1,000 10,800 323,500 800 336,600 

Community Service Employment for Older Americans 0 0 17,400 0 0 17,400 

Work Incentive Program ~I 11,480 15,152 5,190 5,404 0 37.226 

Total ~I 61,480 201,352 502,890 344,104 4,300 1,114,126 

NA = Not applicable. 

~I Rows or Columns may not sum to totals because of rounding. 

kl An emergency supplemental appropriation merged Titles II and VI of CETA for the purpose of 

extending Title VI positions beyond the Title VI expiration date of December 31, 1975. 

£1 The average cost per participant and service year for the WIN program are not strictly 

comparable to CETA data. 
00 

w 

TABLE A-6. CETA, TITLE I: FISCAL YEAR 1977 

Percent 

of Years Average Adjusted Cost per 

Total Total of Length of Partici- Year of 

Training Activity Outlays Outlays Service Stay (years) pants !!.! Service 

(in millions (1n dollars) 

of dollars) 

On-the-Job Training 225 13 47,900 0.36 113,100 4,696 

Classroom Training 685 39 156,700 0.37 423,500 4,371 

Work Experience 713 41 208,500 0.35 595,700 3,420 

Public Service 

Employment 119 7 13,700 0.45 30,400 8,729 

Other ~ _1 3 1 300 0.30 lllOOO 4 1 273 

Total 1,756 100 430,100 0.36 1,173,700 4,051 

SOURCE: Unpublished U.S. Department of Labor data. 

!!.! Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Cost 

per 

Participant 

(in dollars) 

1,989 

1,617 

1,197 

3,927 

1,286 

1,471 
00 

"'" 

TABLE A-7. CETA, TITLE III--MIGRANT AND FARM WORKERS: FISCAL YEAR 1977 

Percent 

of Years Average Cost per 

Total Total of Length of Adjusted Year of 

Training Activity Outlays Outlays Service Stay (years) Partici- Service 

(in millions pants !!/ (in dollars) 

of dollars) 

On-the-Job Training 4 7 900 0.22 4,100 4,222 

Classroom Training 15 25 3,100 0.17 18,200 4,903 

Work Experience 6 10 800 0.18 4,400 7,125 

Public Service 

Employment 0 0 0 0 0 0 

Other 36 ~ 0 0 __ 0 

Total 61 100 4,800 0.18 26,700 12,700 

SOURCE: Unpublished U.S. Department of Labor data. 

!!/ Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Cost 

per 

Participant 

(in dollars) 

926 

835 

1,295 

0 

2 

2,280 
00 

VI 

TABLE A-8. CETA, TITLE III--NATIVE AMERICANS: FISCAL YEAR 1977 

Percent 

of Years Average Cost per 

Total Total of Length of Adjusted Year of 

Training Activity Outalys Outlays Service Stay (years) Partici- Service 

(in millions pants 11.1 (in dollars) 

of dollars) 

On-the-Job Training 3 6 700 0.46 1,500 4,200 

Classroom Training 14 27 4,400 0.44 10,000 3,150 

Work Experience 23 44 10,200 0.44 23,200 2,216 

Public Service 

Employment 12 23 1,500 0.43 3,500 7,915 

Other _Ill ~ 200 0.44 500 1,831 

Total 52 100 17,000 0.44 38,700 3,036 

SOURCE: Unpublished U.S. Department of Labor data. 

Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Le"s than $Q .• 5 million. 

Cost 

per 

Participant 

(in dollars) 

2,002 

1,373 

973 

3,430 

568 

1,344 
00 

CI'\ 

TABLE A-9. CETA, TITLE III--SDMMER YOUTH PROGRAM: FISCAL YEAR 1977 

Percent 

of Years Average Cost per 

Total Total of Length of Adjusted Year of 

Training Activity Outlays Outlays Service Stay (years) Partici- Service 

(in millions pants !J!/ (in dollars) 

of dollars) 

On-the-Job Training 0 0 0 0 0 0 

Classroom Training 0 0 0 0 0 0 

Work Experience 515 100 250,000 0.25 1,000,000 2,380 

Public Service 

Employment 0 0 0 0 0 0 

Other 0 0 0 0 0 

Total 515 100 250,000 0.25 1,000,000 2,380 

SOURCE: Unpublished U.S. Department of Labor data. 

!J!I Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Cost 

per 

Participant 

(in dollars) 

0 

0 

595 

0 

0 

595 
00 

........ 

TABLE A-IO. CETA, TITLE IV--JOB CORPS: FISCAL YEAR 1977 

Percent 

of Years Average Cost per Cost 

Total Total of Length of Adjusted Year of per 

Training Activity Outlays Outlays Service Stay (years) Partici- Service Participant 

(in millions pants !!/ (in dollars) 

of dollars) 

On-the-Job Training 0 0 0 0 0 0 

Classroom Training 202 100 21,000 0.45 46,700 9,599 

Work Experience 0 0 0 0 0 0 

Public Service 

Employment 0 0 0 0 0 0 

Other 0 0 0 

Total 202 100 21,000 0.45 46,700 9,599 

SOURCE: Unpublished U.S. Department of Labor data. 

~ Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

(in dollars) 

0 

4,317 

0 

0 

0 

4,317 
00 

00 

TABLE A-ll. CETA, TITLES VI AND II: FISCAL YEAR 1977 

Percent 

of Years Average Cost per 

Total Total of Length of Adjusted Year of 

Training Activity Outlays Outlays Service Stay (years) Partici- Service 

(in millions pants J!! (in dollars) 

of dollars) 

On-the-Job Training 1 0 500 0.54 900 2,628 

Classroom Training 2 0 1,000 0.53 4,500 1,495 

Work Experience 92 3 10,800 0.60 18,000 8,500 

Public Service 

Employment 2,738 97 323,500 0.53 610,000 8,465 

Other __ 3 -.Q 800 Qd!. 3.800 3.736 

Total for Program 2,836 100 ,600 0.53 637,200 8,429 

SOURCE: Unpublished U.S. Department of Labor data. 

J!! Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Cost 

per 

Participant 

(in dollars) 

1,457 

340 

5,107 

4,486 

~ 

4,449 
00 

\0 

TABLE A-l2. COMMUNITY SERVICE EMPLOYMENT FOR OLDER AMERICANS: FISCAL YEAR 1977 

Percent 

of Years Average Cost per Cost 

Total Total of Length of Adjusted Year pf per 

Training Activity Outlays Outlays Service Stay (years) Partici- Service Participant 

(in millions pants (in dollars) (in dollars) 

of dollars) 

On-the-Job Training 0 0 0 0 0 0 

Classroom Training 0 0 0 0 0 0 

Work Experience 72 100 17,400 2.0 8,700 4,282 

Public Service 

Employment 0 0 0 0 0 0 

Other 0 0 0 __ 0 

Total 72 100 17,400 2.0 8,700 4,282 

SOURCE: Unpublished u.S. Department of Labor data. 

~/ Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

0 

0 

8,276 

0 

0 

8,276 
fl 

Y' 

~ 

; 

;g 

~ ~ 

'" Ci 

01 

'" .., 

'" o 

'" ~ 

, 

'" '" .., 

\0 

0 

TABLE A-l3. WORK INCENTIVE PROGRAM: FISCAL YEAR 1977 

Percent 

of Years Average Cost per 

Total Total of Length of Adjusted Year of 

Training Activity Outlays Outlays Service Stay (years) Partici- Service 

(in millions pants !!/ (in dollars) 

of dollars) 

On-the-Job Training 106 29 11,480 0.35 32,800 9,250 

Classroom Training 50 14 15,152 0.33 45,915 3,656 

Work Experience 14 4 5,190 0.19 27,316 3,680 

Pub 1ic Service 

Employment 68 19 5,404 0.65 8,314 14,766 

Other 122 ~ NA ~ NA 

Total 360 100 37,226 0.35 114,345 9,670 

SOURCE: Unpublished U.S. Department of Labor data. 

NA = Not applicable. 

!!/ Adjusted participants is the number of average annual participants divided by the average 

length of program stay. 

Cost 

per 

Participant 

(in dollars) 

3,237 

1~ 

513 

8.179 

NA 

3,.150