Before the Subcommittee on Benefits,

Committee on Veterans' Affairs, House

of Representatives

United States General Accounting Office

GAO

For Release on Delivery

Expected at 9:30 a.m. EDT

Thursday, June 7, 2001 VETERANS'

EMPLOYMENT AND

TRAINING SERVICE

Further Changes Needed

to Strengthen Its

Performance Measurement

System

Statement of Sigurd R. Nilsen, Director

Education, Workforce, and Income Security Issues

GAO-01-757T
Page 1 GAO-01-757T

Mr. Chairman and Members of the Subcommittee:

Thank you for inviting me here today to discuss our recent report on the

Veterans’ Employment and Training Service’s (VETS) performance

measurement system. VETS, as part of the Department of Labor,

administers programs and activities designed to help veterans obtain

employment and training assistance. Recently, policymakers have focused

increasing attention on VETS and its programs, advocating changes to the

structure and administration of the program and in the way it assesses

program performance. This Subcommittee introduced legislation during

the 106th Congress that would restructure the program and require a new,

comprehensive performance accountability system. In addition, in 1999,

the Congressional Commission on Servicemembers and Veterans’

Transition Assistance recommended that the Congress establish effective

outcome measures for VETS. This focus on reform comes at a time when

other federally funded employment and training programs are changing

the way they provide services and measure performance. For example, the

Workforce Investment Act (WIA), which provides employment and

training assistance for youth, adults, and dislocated workers through onestop centers, recently established outcome measures that are similar to

those that VETS now proposes.

In our recently released report, requested by this Subcommittee, we

reviewed VETS’ efforts to improve its performance measurement system.1

In that report, we examined VETS’ proposed performance measures, the

data source VETS proposes to use in the new system and other

measurement issues that may affect the comparability of states’

performance data. Our work was based on interviews and discussions we

had with over 45 officials in 15 states, interviews with VETS officials, and a

review of government documents and other relevant reports.

In summary, VETS’ proposed performance measures are an improvement

over the current performance accountability system because they focus

more on what its programs achieve and less on the number of services

provided by staff serving veterans. They also no longer require states to

compare the level and associated service outcomes provided to veterans

with those provided to nonveterans and are more closely aligned with WIA

program measures, making it easier for service providers to report on

 1

Veterans’ Employment and Training Service: Proposed Performance Measurement System

Improved, But Further Changes Needed (GAO-01-580, May 15, 2001).
Page 2 GAO-01-757T

outcomes. However, our work revealed a few areas of concern with the

proposed measures. A comparison of the performance measures with the

strategic plan indicates that VETS is sending a mixed message to states

about what services to provide and to whom. VETS’ strategic plan suggests

that states focus their efforts on providing staff-assisted services to

veterans, including case management, yet none of the proposed measures

specifically gauge the success of these services. In addition, VETS’

proposal includes one measure—the number of federal contractor jobs

listed with local employment offices—that is not only process-oriented but

also focuses on outcomes that are beyond the control of staff serving

veterans. VETS also proposes that all states use a single data source—

Unemployment Insurance (UI) wage records—to identify veterans who get

jobs. Using wage record data will greatly improve the comparability and

reliability of the new measures, however, these data also present some

challenges that states will need to overcome. States generally do not have

access to wage records from other states and, therefore, may not be able

to track individuals who receive services in one state but get a job in

another. In addition, certain employment categories are not included in

wage record data. Finally, there are other issues related to how states

count veterans for performance-reporting purposes that VETS needs to

consider as they finalize their performance-reporting requirements. In our

report, we made several recommendations to VETS regarding their

proposed performance measurement system that could strengthen VETS’

efforts to effectively measure the performance of its programs.

VETS administers national programs intended to (1) ensure that veterans

receive priority in employment and training opportunities from the

employment service; (2) assist veterans, reservists, and National Guard

members in securing employment; and (3) protect veterans’ employment

rights and benefits. The key elements of VETS’ services include enforcing

veterans’ preference and reemployment rights and securing employment

and training services. VETS’ programs are among those federal programs

whose services have been affected by WIA and other legislative changes

aimed at streamlining services and holding programs accountable for their

results.

VETS carries out its responsibilities through a nationwide network that

includes representation in each of Labor’s 10 regions and staff in each

state. The Office of the Assistant Secretary for Veterans’ Employment and

Training administers VETS’ activities through regional administrators and

a VETS director in each state. These VETS staff are the link between VETS

Background

VETS’ Programs
Page 3 GAO-01-757T

and the states’ employment service system, which is overseen by Labor’s

Employment and Training Administration (ETA). VETS funds two primary

veterans’ employment assistance grants to states—the Disabled Veterans’

Outreach Program (DVOP) and the Local Veterans’ Employment

Representatives (LVER). Fiscal year 2001 appropriation for VETS was

about $212 million, including $81.6 million for DVOP specialists (DVOPS)

and $77.2 million for LVER staff.2

 These funds paid for 1,327 DVOP

positions and 1,206 LVER positions.

The DVOP and LVER programs provide employment and training

opportunities specifically for veterans. A key responsibility of a DVOP is to

develop job and job training opportunities for veterans through contacts

with employers, especially small- and medium-size private sector

employers. LVERs are to provide program oversight of local employment

service offices to ensure that veterans receive maximum employment and

training opportunities from the entire local office staff.3

 In addition,

DVOPS and LVERs traditionally have provided services that include

locating veterans who need services and providing case management for

those veterans in need of more intensive services. Increasingly, however,

veterans are accessing services on their own, through tools such as

internet-based job listings or resume writing software.

As part of the DVOP and LVER grant agreements, states must ensure that

veterans receive priority at every point where public employment and

training services are available. The DVOP and LVER programs give priority

to the needs of disabled veterans and veterans who served during the

Vietnam era, and state employment service systems are expected to give

priority to veterans over nonveterans. To monitor the states’ programs,

VETS has been using a set of measures that evaluates states’ performance

in five dimensions: (1) veterans placed in training, (2) those receiving

counseling, (3) those receiving services, (4) those entering employment,

and (5) those obtaining federal contractor jobs. These measures primarily

count the number of services that veterans receive and compare the totals

with similar services provided to nonveterans. To ensure priority service

 2

In addition to funds for DVOPS and the LVERs, VETS’ fiscal year 2001 appropriation

included funds for the Homeless Veteran Program and Veterans Workforce Investment

Program.

3

The roles of the DVOPS and LVERs have been separately defined in two statutes. LVERs

were first authorized under the original GI bill (the Servicemen’s Readjustment Act of 1944)

and DVOP specialists were authorized by the Veterans’ Rehabilitation and Education

Amendments of 1980.
Page 4 GAO-01-757T

to veterans, VETS expects levels of performance for services provided to

veterans to be higher than levels for nonveterans. For example, veterans

and other eligibles must be placed in or obtain employment at a rate 15

percent higher than that achieved by nonveterans.

To report on performance, VETS currently relies on the Employment and

Training Administration’s 9002 system to aggregate data reported by states

on veterans and nonveterans who register with state Employment Services

(ES) offices, track the services provided to them (such as counseling or

job referral), and gather information on their employment outcomes. The

9002 system also collects information such as the registrants’ employment

status, level of education (e.g., high school, postsecondary

degree/certificate), and basic demographic information, such as age and

race.

Over the past several years, the Congress has taken steps to streamline

and integrate services provided by federally funded employment and

training programs. WIA, which the Congress passed in 1998, requires

states and localities to use a one-stop center structure to provide access to

most employment and training services in a single location. WIA requires

about 17 categories of programs, including VETS and ES programs, to

provide services through the one-stop center. While DVOP and LVER staff

are required to provide assistance only to veterans, it is unclear how their

services will be integrated at the one-stop centers. However, according to

VETS officials, agreements made with each state on planned services to

veterans now include provisions on how DVOPS and LVERs will be

integrated into the one-stop delivery system.

In addition to changing the way services are provided, programs are now

increasingly held accountable for their results. Through the Government

Performance and Results Act of 1993 (GPRA), the Congress seeks to

improve the efficiency, effectiveness, and public accountability of federal

agencies as well as improve congressional decision making. GPRA does

so, in part, by promoting a focus on what the program achieves rather than

tracking program activities. GPRA outlines a series of steps in which

agencies are required to identify their goals, measure performance, and

report on the degree to which those goals were met.

Legislative and Regulatory

Changes Affecting VETS
Page 5 GAO-01-757T

To address the goals of GPRA and in response to recommendations by us

and other groups, such as the Congressional Commission on

Servicemembers and Veterans Transition Assistance,4 VETS is currently

developing a new system to measure the performance of its programs.

Over the last several years, VETS conducted pilot programs in about eight

states that tested some new performance measures and the use of new

data to support these measures. VETS officials told us that they anticipate

implementing their new performance measurement system in program

year 2001.

VETS’ proposed performance measures include an (1) enteredemployment rate, (2) employment rate following staff-assisted services,

(3) employment retention rate, and (4) increase in the number of federal

contractor job openings listed. These measures are an improvement over

current ones, but certain aspects of these measures raise concerns that

VETS needs to address.

The proposed performance measures improve accountability because they

place more emphasis on employment-related outcomes by eliminating

process-oriented measures—measures that simply track services provided

to veterans. Current process measures that VETS eliminated from the

proposed performance system include the number of veterans referred to

counseling, the number placed in training, and the number receiving

certain other services, such as job referrals. As we noted in past reports,

these process-oriented measures are activity- and volume-driven and focus

efforts on the number of services provided, not on the outcomes veterans

achieve.5

 These measures offer states little incentive to provide services to

those veterans who are only marginally prepared for work and who may

need more intensive services requiring more staff time. The VETS’

proposal still includes one process-oriented measure that simply reflects

the percentage increase in the number of federal contractor job openings

listed with the public labor exchange but adds two outcome-oriented

 4

See Report of the Congressional Commission on Servicemembers and Veterans Transition

Assistance, January 14, 1999, Congressional Commission on Servicemembers and Veterans

Transition Assistance, Arlington, VA.

5

See Veterans’ Employment and Training Service: Focusing on Program Results to Improve

Agency Performance (GAO/T-HEHS-97-129, May 7, 1997) and Veterans’ Employment and

Training Service: Better Planning Needed to Address Future Needs (GAO/T-HEHS-00-206,

Sept. 27, 2000).

VETS’ Proposed

Measures Hold

Promise, but Some

Concerns Remain

Proposed Measures Are an

Improvement Over the

Current Ones
Page 6 GAO-01-757T

measures—job retention after 6 months and the employment rate

following staff-assisted services.6

 The VETS’ proposal also retains an

outcome measure that is in the current system—the entered-employment

rate. (See table 1.)

Table 1: VETS’ Current Performance Measures Compared With Proposed Measures

Current measures

ProcessorientedOutcomeoriented

Entered-employment rate:

The percentage of all registered veterans who were placed in

or obtained employment.

X

Number of veterans placed in training:

A count of the veterans placed in training. X

Number of veterans receiving counseling:

A count of the veterans who received counseling services. X

Number of veterans receiving some reportable service:

A count of the veterans who received at least one reportable

service.

X

Federal contractor jobs filled by Vietnam and special disabled

veterans:

A count of the veterans who were placed in jobs listed on the

federal contractor job list.

X

Proposed measures Processoriented

Outcomeoriented

Entered-employment rate:

The percentage of all registered veterans who were placed in

or obtained employment.

X

Employment rate following receipt of staff-assisted services:

The percentage of registered veterans who are employed

after receiving some form of staff-assisted labor exchange

services.

X

Employment retention rate at 6 months:

Of the veterans who had entered employment following

registration, the percentage of those who continued to earn

wages 6 months after entering employment.

X

Federal contractor job openings listed with the public labor

exchange:

The percentage increase in the number of federal contractor

job openings listed annually with the public labor exchange

from one program year to the next.

X

Source: Veterans’ Employment and Training Service, Department of Labor.

 6

VETS considers this measure as process-oriented “with an emphasis on outcomes.”

However, for this report, we classified the measure as outcome-based because it reports an

employment rate rather than only reporting a count of services.
Page 7 GAO-01-757T

The proposed performance measures also improve the way VETS

establishes the level of performance that states are expected to achieve.

VETS no longer requires states to compare the level of services provided

to veterans with those provided to nonveterans.7

 In past reports, we have

pointed out that the use of these relative standards results in states with

poor levels of service to nonveterans being held to lower standards for

service to veterans than states with better overall performance.8

 Under the

proposed system, VETS will negotiate performance levels annually with

each state based on that state’s past performance, using guidelines similar

to those used for WIA.9

 VETS will also be able to adjust these levels based

on economic conditions within each state, such as the unemployment rate,

the rate of job creation or loss, or other factors.

The proposed performance measures are also similar to those established

under WIA, making it easier for service providers to achieve WIA’s goal of

integrating and streamlining employment and training services. In the

current environment, many of the programs that provide services through

the one-stop centers have their own unique performance measures and

program definitions, requiring multiple systems and multiple data

collection efforts to track a single client. In the proposed system, VETS is

trying to align its performance measures with those of WIA. Two of the

five proposed measures—entered-employment rate and employment

retention—are nearly identical to WIA’s and to those proposed for ES.10 If

VETS aligns the measures with those of WIA and ES, local offices will be

more readily able to establish integrated data systems that will minimize

the data collection burden on service providers and clients.

 7

While states will no longer be required to compare the level of services given to veterans

and nonveterans, VETS is required to report annually to the Congress on the job placement

rate of veterans compared with the rate for nonveterans. 38 U.S.C. § 4107.

8

See GAO/T-HEHS-97-129.

9

VETS is planning to use WIA’s negotiation process to establish expected performance

levels for labor exchange services. VETS proposes that states use 2 years of data if

possible, but not less than 1 year in determining trends for performance and factors that

may influence performance.

10See GAO-01-580 for a comparison of VETS, ES, and WIA performance measures.
Page 8 GAO-01-757T

While the proposed performance measures are an improvement over those

currently in place, there are issues with these measures that VETS should

address. First, a comparison of the performance measures with the

strategic plan indicates that VETS is sending a mixed message to states

about what services to provide and to whom. The strategic plan suggests

that states focus their efforts on providing staff-assisted services to

veterans, including case management. Yet, none of the proposed measures

specifically gauges whether more staff-intensive services are helping

veterans get jobs. VETS’ proposal includes a measure that tracks

employment outcomes following staff-assisted services. However, this

measure is broadly defined, and the list of staff-assisted services includes

nearly all services provided to veterans.11 This makes the outcomes

achieved for the staff-assisted measure nearly identical to those reported

for the more general “entered-employment rate.” In addition, as VETS has

defined it, staff-assisted services include many services that might not be

considered “intensive,” such as referral to a job and job search activities.

Because the definition is so broadly defined, a veteran who only attended

a job search workshop would be counted the same as a veteran who

received more intensive services, such as testing and employability

planning. Both would be counted in the more general entered-employment

rate measure, as well as the staff-assisted service measure. A stricter

definition for staff-assisted services that includes only those services that

are generally considered staff-intensive would allow VETS to more

accurately assess the success of those services and help to clarify the

goals of the program.

Second, VETS is sending a mixed message about which groups of veterans

to target for services. As we noted in past reports and testimonies, VETS

has inconsistently identified various “targeted” groups of veterans it plans

to help.12 In its strategic plan, VETS identifies two broad veterans groups

that should be targeted to receive special attention—(1) disabled veterans

 11VETS uses the ETA definition of staff-assisted services. Staff-assisted services include (a)

referral to a job; (b) placement in training; (c) assessment services, including an

assessment interview, testing, counseling, and employability planning; (d) career guidance;

(e) job search activities, including resume assistance, job search workshops, job finding

clubs, providing specific labor market information and job search planning; (f) federal

bonding program; (g) job development contacts; (h) tax credit eligibility determination; (i)

referral to other services, including skills training, educational services, and supportive

services; and (j) any other service requiring expenditure of time. Application taking and/or

registration services are not included as staff-assisted services.

12See GAO/T-HEHS-00-206.

Concerns Remain That

VETS Should Address
Page 9 GAO-01-757T

and (2) all veterans and other eligible persons. And consistent with this,

VETS proposes that expected performance levels be negotiated separately

for each of these same two groups. Yet, the strategic plan also suggests

that, when providing services to all veterans, special attention should be

given to meeting the needs of certain other target groups, some of which

might require more intensive services to become employed. The groups

targeted for special attention include (1) veterans who have significant

barriers to employment, (2) veterans who served on active duty during a

war (or campaign or expedition in which a campaign badge has been

authorized), and (3) veterans recently separated from military service. In

reviewing VETS’ proposed measures and the plan for negotiating

performance levels, it is unclear what steps VETS will take to ensure that

DVOPS and LVERs are provided ample opportunity and encouragement to

focus attention on the portion of the “all veterans” group who may require

more staff time to be successful in getting a job.

Last, VETS’ proposal also continues to include a performance measure

related to federal contractor job openings listed with the state’s ES office.

However, in its proposal, VETS has changed the measure. Under the

current system, VETS tracks the number of Vietnam-era and special

disabled veterans who were placed in jobs listed by federal contractors—

an outcome measure. Now, under the proposed system, VETS will track

the increase in the number of federal contractor jobs listed with the state’s

ES office—a process-oriented measure.13 This new measure ultimately

holds DVOPS and LVERs accountable for the number of federal

contractors in a given state or local area, not for veteran placements with

those contractors. The presence of federal contractors in a given state or

local area is unpredictable and is determined by the federal agencies

awarding contracts. Furthermore, according to state officials that we

talked with, the federal contractor measure should be eliminated

altogether because it is the responsibility of contractors to list their job

openings. In addition, it is Labor’s Office of Federal Contract Compliance

 13Any contractor or subcontractor with a contract of $25,000 or more with the federal

government must take affirmative action to hire and promote qualified special disabled

veterans, veterans of the Vietnam-era, or any other veterans who served on active duty

during a war or in a campaign or expedition for which a campaign badge has been

authorized. Contractors and subcontractors with job openings, other than executive or top

management jobs, must list them with the nearest state employment office. Veterans cited

above receive priority for referral to federal contractor job openings listed at those offices.
Page 10 GAO-01-757T

that is responsible for ensuring that all companies conducting business

with the federal government list their jobs with state ES offices and take

affirmative action to hire qualified veterans.

Consistent with WIA and ES, VETS is proposing that all states use UI wage

records, which contain the earnings of each employee reported quarterly

to state agencies,14 to identify veterans who get jobs. While these data will

greatly improve the comparability and reliability of the proposed

performance measures, they will also bring some challenges that VETS

needs to address.

Using a single data source will help to standardize the way in which states

collect data on veterans, thereby making it easier to compare performance

across states. Currently, states are using various data sources for

performance-reporting purposes. While almost all of the states in our

review used a combination of data sources to determine whether or not a

veteran got a job, most of the states relied substantially on one data

source, but that source differed among states. For example, in program

year 1999

• 7 of the 15 states that we contacted relied to a large extent on wage record

data to determine whether a veteran got a job or not;

• 7 others relied, for the most part, on telephone calls and letters to veterans

and employers to determine a veteran’s employment status; and

• 1 state relied primarily on its new hire database for employment data.15

 14Each calendar quarter, employers in a state provide wage information on their employees

to their state’s UI agency or some other state agency. The information contained in wage

records varies from state to state. However, all wage records contain at least the following

information: the calendar quarter that the wages were reported in, the employee’s social

security number, wages paid to the employee in that quarter, and employer information.

15The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 established

the National Directory of New Hires and State Directories of New Hires. The National

Directory is maintained by the Social Security Administration on behalf of the Department

of Health and Human Services, Office of Child Support Enforcement. States maintain their

own State Directories of New Hires and generally supply data for the National Directory.

Information in these directories includes: new hire information, such as name, address, and

social security number of the employee and the name, address, federal identification

number of the employer; in some states, wage information; and UI claim information.

Proposed Data Source

for New Measures Is

an Improvement but

Will Bring Some

Challenges

Proposed Data Source Will

Help to Ensure

Comparability and

Reliability Across States
Page 11 GAO-01-757T

In addition to making state data more comparable, we found evidence that

states currently using wage records have been able to better identify those

veterans who get jobs after receiving services. A recent study found that

UI wage records more accurately identified how many veterans in the

state of Maryland got jobs after receiving DVOP, LVER, or ES services.16 In

addition, most states in our review that are now using UI wage records,

either as their primary data source or to augment other data sources,

reported higher employment rates in program year 1999 for veterans they

served than that year’s national average of 30 percent.17 By comparison, all

but one of the states that relied either on manual follow-up or the new hire

database reported an employment rate below the national average.

Another benefit of using UI wage records is that staff assisting veterans

will be relying on data already available rather than collecting additional

information from veterans or employers. Relying on these already

reported data would require less staff time from DVOP, LVER, and ES

staff, freeing them to focus more on providing job-related services to

veterans. State officials told us that relying on manual follow-up, such as

telephone calls, has been labor-intensive and has diverted staff attention

away from providing appropriate assistance to veterans.

While UI wage records offer advantages over the current data collection

system, some challenges need to be addressed. First, states should find

ways to identify interstate job placements. Because the UI wage record

system resides within each state, states generally do not have access to

wage records from other states, making it difficult to track individuals who

receive services in one state but get a job in another. Currently, there is no

national system in place that facilitates data sharing among states.

However, in response to WIA requirements, states are developing an

interstate UI wage record information sharing system, known as the Wage

 16Using UI wage records, this study tracked veterans who registered with the Maryland Job

Service during program year 1997 and found an entered-employment rate that ranged from

65 percent to 82 percent, depending on the way the study defined a registrant. In that same

program year, Maryland reported to VETS an entered-employment rate of 31 percent,

which was based on staff telephoning veterans and employers to verify employment. See

Proposed New Entered Employment Patterns of Veteran Wagner-Peyser Registrants in the

State of Maryland, by Robert Cook, BETAH Associates; and Edward Davin and Karin

Willner, DynCorp (Apr. 12, 2000).

17See GAO-01-580 for a list of all states and their respective entered-employment rates for

program years 1996-99.

UI Data Presents Some

Challenges
Page 12 GAO-01-757T

Record Interchange System (WRIS). The system is designed to minimize

the burden on state unemployment insurance programs in responding to

requests for wage record data, to ensure the security of the transactions

involving individual wage records, and to produce the results at a low cost

per record. In addition, some states have entered into agreements with

neighboring states to share wage information in support of WIA. These

efforts should help VETS as well.

Second, states should find ways to identify those veterans finding jobs in

categories not covered by UI wage records. According to Labor, UI wage

records include data on about 94 percent of workers. Certain employment

categories are not included in these data, such as self-employed persons,

most independent contractors, military personnel, federal government

workers, railroad employees, some part-time employees of nonprofit

institutions, and employees of religious orders. Therefore, the UI system

will not be able to track and count veterans who get these types of jobs.

This is an issue for WIA as well, and states are beginning to assess the

extent to which this issue will affect their ability to accurately determine

the outcome of WIA-funded programs.

There are other issues not related to the use of UI wage records that VETS

should consider as it finalizes its performance-reporting requirements.

VETS’ proposed performance system does not standardize how states

report veterans or nonveterans who use self-service activities, making it

difficult to reliably assess nationwide performance. In an environment in

which self-service is becoming more common, we found that states vary in

whether they register veteran job seekers who access self-service tools,

such as internet-based job listings or resume writing software. For

example, some states allow job seekers greater access to job listings

without requiring that they register, while others have more restrictions on

who can access job lists. Table 2 shows how such differences can affect

entered-employment rates. In this example, 100 veterans enter the

employment service for assistance. In both cases, 40 veterans ultimately

get jobs after receiving identical services. In one case, the placement rate

is 40 percent and in the other, 50 percent—a 10-percentage point

difference. This difference results from counting all job seekers in one

case and only those requiring staff assistance in the other. As a result of

the different ways states currently count veterans and report outcomes,

the entered-employment rate measure is not consistently calculated across

states, and nationwide comparisons are misleading.

Other Measurement Issues

Affect Comparability of

States’ Performance Data
Page 13 GAO-01-757T

Table 2: A Comparison of Entered-Employment Rates by Registration Policy

All veterans required to register Veterans accessing self-service do not have to register

Veterans

registered

Number of

veterans who

get jobs

Number of

veterans with

jobs counted

in enteredemployment

rate

Veterans

registered

Number of

veterans

who get jobs

Number of

veterans with

jobs counted

in enteredemployment

rate

40 veterans

use selfservice

40 10 10 40 veterans

use selfservice

0 10 0

60 veterans

require staff

assistance

60 30 30 60 veterans

require staff

assistance

60 30 30

Total 100 40 40 Total 60 40 30

Reported Entered-Employment Rate: 40/100 = 40% Reported Entered-Employment Rate: 30/60 = 50%

Source: GAO analysis.

VETS’ proposed performance system does not standardize how long a

veteran or nonveteran remains registered after seeking services for

performance-reporting purposes. We found that states differ in how long

they keep veterans registered. This difference makes the calculation of the

entered-employment rate (i.e., the number of veterans that get jobs)

different from state-to- state and nationwide comparisons unreliable. Many

of the states we contacted count individuals as registered who have

received a service in the last 6 months. However, two states only count

those as registered who have received a service in the last 3 months, while

two others count only those who received a service in the last 2 months.

And in one state, anyone who has received a service from the state’s

employment office since 1998 is counted as a registrant when determining

the entered-employment rate.

VETS has proposed changes to its performance measurement system that

will move VETS closer to implementing an effective accountability system.

However, additional changes are needed so that VETS can effectively

determine whether its programs and services are fulfilling its mission.

VETS continues to send a mixed message to states about what services to

provide and to whom. In addition, two of the proposed measures—the

entered-employment rate and the employment rate following staff-assisted

services—may provide nearly identical results, and neither helps VETS to

monitor whether more intensive services are being provided to veterans or

whether these services are successful. Furthermore, through its planning

documents and proposed performance measures, VETS continues to

Conclusions and

Recommendations
Page 14 GAO-01-757T

inconsistently identify the groups of veterans that it wants states to help.

Our report recommended that the Secretary of Labor direct VETS to

redefine staff-assisted services to include only those that may be

considered staff intensive, such as case management, so that VETS can

evaluate these services. We also recommended that VETS clearly define its

target populations so that staff assisting veterans know where to place

their priorities. VETS acknowledged that its current strategic plan sends a

mixed message to the states about which groups of veterans staff should

target for special attention and noted that it is revising its planning

documents to reflect a more consistent message. VETS disagreed,

however, with our recommendation for a revised definition of the

performance measure related to staff-assisted services.

VETS also maintains a measure related to federal contractors that does

not focus on whether veterans get jobs but instead counts how many job

openings are listed by federal contractors. In addition, state officials told

us that it is the responsibility of the contractors, not DVOPS and LVERs, to

list their job openings. Our report recommended that VETS eliminate this

measure. While VETS disagreed with this recommendation, it agreed to

reconsider the suitability of this specific measure after public comments

have been received.

Finally, because VETS allows states to decide which veterans to include in

its performance reports, data across states are inconsistent and state-tostate comparisons are unreliable. Our report recommended that VETS

establish and communicate guidelines that standardize how to count

veterans for performance-reporting purposes so that VETS will be able to

assess program performance nationwide. VETS noted that it is working

with ETA to determine how states can uniformly report veterans and

nonveterans that use self-service activities and that the revised ETA 9002

report will provide instructions on how long individuals remain registered

in the system.

Mr. Chairman, this concludes my prepared statement. I will be happy to

answer any questions that you or other members of the Subcommittee

may have.

For future contacts regarding this testimony, please contact Sigurd R.

Nilsen at (202) 512-7215. Key contributors to this testimony were Dianne

Blank, Elizabeth Morrison, and Amanda Ahlstrand.

GAO Contacts and

Acknowledgments

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