# Recent Reports

Reports News from the GAO

- Higher Education: Employment Discrimination Case Referrals Between Education and the Equal Employment Opportunity Commission Could Be Improved What GAO FoundThe proportions of Black or African American (Black) and Hispanic or Latino (Hispanic) college faculty increased from fiscal years 2003 through 2021. Yet, there were lower proportions of Black and Hispanic college faculty compared to Black and Hispanic workers with advanced degrees (e.g., master's and doctorate) and professional workers (e.g., lawyers and engineers), according to GAO's analysis of Department of Education and Census Bureau data. Black and Hispanic individuals were also less represented among college faculty than among students, according to GAO's analysis of Education data. For example, in fiscal year 2021, 8 percent of faculty were Black compared to 12 percent of students, and 7 percent of faculty were Hispanic compared to 19 percent of students.College Faculty and Students by Race and Ethnicity, Fiscal Year 2021Notes: Black refers to Black or African American. Hispanic refers to Hispanic or Latino. An individual who self-identifies as Hispanic only, or both Hispanic and any race category, would be classified as Hispanic. The Other category includes individuals such as those that identified as Native American, Pacific Islander, multiple races, or unknown race.GAO's literature search identified strategies used by colleges to recruit and retain a diverse faculty, given the potential benefits to their students. Colleges have enhanced their job search processes, developed mentoring programs, and improved campus climate to recruit and retain a diverse faculty.Education refers certain employment discrimination complaints against colleges to the Equal Employment Opportunity Commission (EEOC) for investigation consideration but has been consistently late in doing so. In fiscal year 2022, Education processed and referred to EEOC 99 complaints alleging employment discrimination at colleges based on race, color, national origin, or sex. GAO found that Education referred the complaints in 71 days on average, although Education policy calls for doing so in 30 days. However, Education does not track the timing of these referrals. Without doing so, Education could miss an opportunity to learn from offices that are more timely than others and apply those lessons agency-wide to reduce delays. Individuals with delayed complaints may experience adverse effects, such as continued discrimination or less pay. In fiscal year 2021, EEOC processed 1,342 complaints alleging employment discrimination at colleges based on race, color, religion, sex, national origin, or disability, some of which were referred by Education. However, EEOC does not have a protocol to consistently track and account for the complaint referrals. Recently, one such referral was not initially received by EEOC until the individual who filed the complaint followed up. Without a protocol to ensure that EEOC receives and processes all Education complaint referrals, some may be missed or resolution may be delayed.Why GAO Did This StudyWhile the U.S. population has become increasingly diverse, college faculty may not reflect those same levels of diversity. Little is known at the national level about the relationship between faculty diversity and student outcomes. Separately, faculty have reported experiencing discrimination at colleges.GAO was asked to review faculty diversity and employment discrimination at colleges. This report examines (1) selected aspects of diversity among faculty, (2) efforts by colleges to recruit and retain a diverse faculty, and (3) how Education and EEOC process employment discrimination complaints at colleges. GAO analyzed Education data on faculty and students from fiscal years 2003–2021, national workforce data from the Census Bureau and Bureau of Labor Statistics ranging from calendar years 2014–2021, Education complaint data from fiscal years 2011–2022, and EEOC complaint data from fiscal years 2011–2021 (each set was the most recent available). GAO also conducted literature reviews; reviewed relevant federal laws, regulations, and policies; and interviewed agency officials and selected higher education experts.
- Service Members Transitioning to Civilian Life: Agencies Can Improve Warm Handovers for Additional Assistance What GAO FoundTo assist certain service members who may be at risk for a difficult transition from military to civilian life, the Department of Defense (DOD) provides them with a person-to-person connection, known as a “warm handover,” to other agencies. These other agencies include the Department of Veterans Affairs (VA) and the Department of Labor (DOL), which can help the service members obtain additional transition services. Through its Transition Assistance Program, DOD ensures these service members receive agency contact information, but does not ensure that a connection with a person actually occurs (see figure). DOD provided at least one warm handover to about 41,000 service members, according to available data from April 1, 2021, to March 31, 2023. However, during this same time period the agency did not provide a warm handover to over 4,300 other service members who were also considered at-risk of having a challenging transition. DOD officials said the agency has not analyzed the reasons why these service members did not receive a warm handover. Without developing a written plan to analyze its data, DOD cannot ensure that the thousands of service members transitioning annually have access to the additional assistance they need and the benefits they have earned.DOD's Warm Handover Process Does Not Ensure Service Members Connect with Agencies for Additional Assistance with Their Transition to Civilian LifeTransition Assistance Program counselors and others told GAO that warm handovers could be helpful to some service members, but DOD has not assessed their helpfulness. DOD has recently worked with VA and DOL on pilot projects that will provide some additional information, but these efforts are expected to provide limited information on warm handovers, and other agency efforts to assess the Transition Assistance Program do not focus on warm handovers. Without a plan to assess the helpfulness of warm handovers, program officials may be missing opportunities to ensure they are meeting the needs of service members.Agencies generally collaborated effectively to implement pilot projects aimed at refining warm handovers, but they have not identified criteria to make decisions about scaling all of the piloted approaches. Without identifying specific criteria, these agencies risk not collecting data needed to decide whether and how to scale the piloted approaches to the broader Transition Assistance Program and warm handover processes.Why GAO Did This StudyHundreds of thousands of service members transition from military service to civilian life each year, and some can be at risk for unemployment, homelessness, or gaps in medical care. To help them succeed, DOD provides certain service members with a warm handover to other agencies and organizations for additional assistance.Senate report 117-130 includes a provision for GAO to review DOD's warm handover process. GAO's report addresses the extent to which DOD: (1) ensures that service members receive a warm handover as appropriate, (2) assesses information on the helpfulness of warm handovers, and (3) collaborates with VA and DOL in their efforts to refine the warm handover process.GAO analyzed DOD program data for April 1, 2021, to March 31, 2023, the most recent available. GAO also reviewed relevant federal laws, policies, and agency documents, and interviewed officials from relevant federal agencies and five military installations selected for diversity in numbers of transitioning service members, geographic location, and service branch.
- Human Capital: Characteristics and Administration of the Federal Wage System What GAO FoundThe Federal Wage System (FWS) and General Schedule (GS) pay system cover about 192,455 federal blue-collar wage grade and 1.5 million federal white-collar GS employees as of 2023, respectively. Each pay system has its own separate laws, regulations, and policies that govern how it is to be administered.FWS employees receive an annual pay adjustment based on pay comparisons between FWS and private sector jobs in defined wage areas that require similar skills and responsibilities. Congressional actions have capped the FWS pay adjustments so they do not exceed the average GS pay adjustment since fiscal year 1979. This is due to budgetary concerns, according to Office of Personnel Management (OPM) officials.Since fiscal year 2004, congressional actions have required FWS employees to receive at least the same wage schedule adjustment in percentage terms that GS employees receive where they work. According to OPM and Department of Defense (DOD) officials, linking FWS pay adjustments to GS pay adjustments has resulted in FWS pay rates that are below or above prevailing (market) levels.Average Wage Schedule Rates Compared to Prevailing Wage Rates for Nonsupervisory Employees in Appropriated Fund (AF) Wage Areas for Fiscal Year 2023Note: Employees in AF wage areas are generally funded from the Treasury. In some cases, data showed that the average wage rates were both above and below prevailing (or market) rates where there are multiple wage schedules associated with a single AF wage area.The process for administering the FWS includes: (1) establishing and combining wage areas, (2) conducting wage surveys, and (3) setting wage schedules. OPM defines wage areas based on geographic concentrations of FWS employees and private employment. Designated by OPM, DOD conducts annual surveys to collect data from private sector establishments within the wage areas and sets hourly pay rates for the wage schedules.Why GAO Did This StudyThe Prevailing Rate Systems Act of 1972 established the FWS for federal blue-collar employees who work in trade, craft, and labor. The act's underlying principles are to set pay rates for federal blue-collar workers in line with local prevailing (or market) rates and provide equal pay for substantially equal work. However, subsequent actions by Congress have limited the maximum pay adjustments granted to certain FWS employees, tying them to the average GS pay adjustment.The Joint Explanatory Statement for the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 includes a provision for GAO to review the administration of the FWS. This report describes (1) characteristics of the FWS and GS pay systems and how they compare, and (2) the process for administering the FWS.GAO reviewed legislation; OPM regulations, memorandums, guidance, and documentation; DOD guidance, data, and documentation; and Federal Prevailing Rate Advisory Committee reports. GAO also interviewed OPM and DOD officials and Federal Prevailing Rate Advisory Committee members (comprised of agency and labor management representatives) who provide input to OPM on defining wage areas.DOD and OPM provided technical comments on a draft of this report, which GAO incorporated as appropriate.For more information, contact Yvonne D. Jones at (202) 512-6806 or jonesy@gao.gov.
- Science & Tech Spotlight: Wearable Technologies in the Workplace Why This MattersIn 2022, the warehousing, manufacturing, and construction industries experienced over 700,000 nonfatal injuries and over 2,000 fatal accidents. Meanwhile, consumer demand on these industries grows, creating pressure for increased productivity. To enhance and monitor worker safety and productivity, companies have begun deploying wearable technologies, from ergonomic sensors to exoskeletons.Key TakeawaysRecent innovations in sensor and networking technologies have increased the feasibility of and interest in the use of wearables in the workplace.	Companies have already deployed some wearables, but there are limited published data on the efficacy of these technologies to increase safety in the workplace.	Concerns about data privacy, cost, and ease of use may hinder widespread workplace adoption of wearables.The TechnologyWhat is it?&nbsp;Wearable technologies, or wearables, are devices worn on the body and can vary in size, shape, and function. Some employers have an increasing interest in using wearables to improve worker safety and productivity. Industrial uses fall into four general categories:&nbsp;(1) supporting devices&nbsp;physically assist workers with tasks like lifting (e.g., exoskeletons and powered gloves);&nbsp;(2) monitoring&nbsp;devices&nbsp;alert workers to specific changes in vital signs or the workplace environment (e.g., smart helmets);&nbsp;(3) training&nbsp;devices&nbsp;provide feedback on movements (e.g., ergonomic sensors) or help improve worker performance (e.g., augmented reality (AR) glasses); and&nbsp;(4) tracking devices&nbsp;observe the location of employees on a worksite (e.g., GPS trackers). See figure 1 for examples.Figure 1. Illustration of some wearable technologies of interest to modern industrial workplaces.How does it work?&nbsp;The way wearables work depends on the type of technology.Supporting devices&nbsp;like&nbsp;exoskeletons&nbsp;or&nbsp;powered gloves&nbsp;provide physicalsupport to the user’s shoulders, hands, or back during repetitive overhead work, gripping, or lifting.Most&nbsp;monitoring, training, and tracking&nbsp;technologies take advantage of innovations in networking by connecting many types of sensors to collect, exchange, and analyze data—sometimes referred to as the industrial internet of things (IIOT).&nbsp;Smart helmets, for example,incorporate physiological and environmental sensors and GPS trackers into protective headgear. These sensors can alert employees and workplace medical teams to accidents, such as falls, and to potential hazards, like heat and humidity. Similarly,&nbsp;ergonomic sensors, worn on the hip, back, or arm, can alert a user when they perform potentially unsafe movements (e.g., lifting with improper form). Through real-time alerts and movement data analytics, these sensors may help train workers and reduce injuries.How mature is it?&nbsp;Advancements in sensors, data analytics, and networking technologies have increased the feasibility of wearables, although their maturity varies. Several companies use exoskeletons or ergonomic sensors to some extent. Other wearables, such as smart helmets, have had pilot studies but still need further testing. Battery life and accuracy of underlying location tracking technologies pose challenges for scale-up.Recent studies have drawn limited conclusions in assessing the net effect of wearables on employee health and productivity. For example, one peer reviewed study showed that ergonomic sensors may reduce time in risky postures, but the study had limitations including a small sample size and short duration. A different review of wearables points out that the pressure of being constantly monitored can lead to increased stress in some workers and, consequently, increased probability of injury.OpportunitiesImprove employee safety.&nbsp;Wearables could reduce the risk of injuries from strenuous work or worker-equipment collisions and may improve response time to emergencies.	Increase employee productivity.&nbsp;Some companies have used AR glasses to aid repair technicians or to reduce error rates when item picking to fill orders.ChallengesPrivacy. Monitoring devices can store data on employee physiology and movements, which may create privacy concerns. For example, employees surveyed as a part of a wearable pilot test cited concerns about being tracked.;	Data Security.&nbsp;Data stored on wearables may be vulnerable to hackers because updating software can be difficult and many devices lack strong encryptions.	Cost.&nbsp;Companies can face high up-front costs to acquire and deploy wearables.	Ease of use.&nbsp;Employees may find some technologies cumbersome, complex, or uncomfortable to use. For example, one study cited employee concerns about the additional weight of the wearable.Policy Context and QuestionsThe National Institute for Occupational Safety and Health (NIOSH) conducts and coordinates research on wearables. Officials from the Occupational Safety and Health Administration (OSHA) told us that the agency oversees workplace safety but does not have any specific standards related to wearables.What types of additional studies would determine whether wearables achieve benefits such as improving employee safety?	What is the federal role, if any, in overseeing these technologies and their use in the workplace?	What safeguards or standards, if any, could help ensure that the development and adoption of wearables achieves positive outcomes and responds to employee concerns?Selected GAO WorkWorkplace Safety and Health: Actions Needed to Improve Reporting of Summary Injury and Illness Data,&nbsp;GAO-21-122.Internet of Things: Status and implications of an increasingly connected world,&nbsp;GAO-17-75.Selected References"Wearable Technologies" NIOSH Science Blog,&nbsp;https://blogs.cdc.gov/niosh-science-blog/category/wearable-technologies/.&nbsp;Accessed January 29, 2024.Ekaterina Svertoka, et al., “Wearables for Industrial Work Safety: A Survey,”&nbsp;Sensors,vol. 21 (2021) doi:10.3390/s21113844.For more information, contact Karen L. Howard, PhD at (202) 512-6888 or howardk@gao.gov.
- Commonwealth of the Northern Mariana Islands: Greater Transparency Could Improve Worker Ratio Reports What GAO FoundU.S. workers made up at least half of employed workers in the Commonwealth of the Northern Mariana Islands (CNMI) between 2018 and 2022, according to GAO's analysis of CNMI tax data. When comparing 2018 to 2022, GAO found the U.S. portion of CNMI workers increased and the foreign portion decreased. In addition to categorizing U.S. and foreign workers using the CNMI tax data, GAO categorized workers as "unknown" when the data were insufficient to place them in the other two categories. Due to this unknown portion, the precise ratio of U.S. to foreign workers for each year is uncertain. The figure below illustrates the minimum share U.S. workers represented each year, as well as the degree to which that share might increase depending on whether unknown workers were U.S. or foreign.U.S. and Foreign Workers in the Commonwealth of the Northern Mariana Islands (CNMI), Calendar Years 2018–2022Note: GAO’s categorization of these workers is based solely on CNMI’s tax data and is not a determination based on records underlying the data of whether any individual meets the definition of U.S. worker under the Northern Mariana Islands U.S. Workforce Act of 2018. Percentages shown for 2021 do not sum to 73 and 100 due to rounding. For more details, see section related to fig. 1 in GAO-24-106698.The Northern Mariana Islands U.S. Workforce Act of 2018 (the Act) requires the Governor of CNMI to report annually on the ratio of U.S. to foreign workers. To create these reports, the CNMI government uses employers' tax data. However, it has reported that these data include a relatively high share of workers with unknown visa types—from 13 to 33 percent in the 2018 to 2021 reports, making the precise ratio of U.S. to foreign workers uncertain. CNMI has recently taken steps to improve its data analysis process, reducing the unknown portion of workers to 4 percent in the 2022 data.The CNMI government has taken some steps to communicate the analytical approach it uses to create its annual worker ratio report. For example, it uses the report and a Standard Operating Procedure to communicate some of its analytical approach. However, these documents do not include key information such as the approach CNMI uses to categorize unknown workers as U.S. or foreign, as well as the implications of the unknown portion for the ratio. Key elements of economic analysis call for transparency of an analytical approach to allow the public to assess its structure and to understand how much of its result hinges on the specific choices made by the authors.Improved transparency of the approach could benefit CNMI and other stakeholders. Specifically, greater transparency would enable CNMI officials to consistently replicate recent improvements to the annual worker ratio reports in the future. It would also help CNMI and stakeholders determine worker trends over time and assess whether CNMI's efforts to achieve one of the Act's goals—increasing the percentage of U.S. workers in the CNMI workforce—have been successful.The Office of Insular Affairs within Interior promotes the coordination of federal policy for CNMI and provides discretionary financial and technical assistance to CNMI. Interior officials also said they work with CNMI to identify the needs for future grants and coordinate that work with other agencies as appropriate.Why GAO Did This StudyCNMI's economy has historically relied on foreign workers, who made up more than half of its workers for the decade before the passage of the Consolidated Natural Resources Act of 2008 (CNRA). Under the CNRA, the Department of Homeland Security established a temporary foreign worker permit program for the CNMI called the CNMI-Only Transitional Worker (CW-1) program. The 2018 Act extended the CW-1 program through December 31, 2029, and sought, in part, to increase the percentage of U.S. workers in the total CNMI workforce while maintaining the minimum number of workers who are not U.S. workers to meet the changing demands of CNMI's economy. The Act calls for various reports on CNMI's progress toward this goal, including an annual report by CNMI's Governor identifying the ratio between U.S. workers and foreign workers in CNMI's workforce.The Act includes a provision for GAO to report every 2 years on the ratio between U.S. and foreign workers in CNMI's workforce in each of the previous 5 calendar years. This is GAO's third report in response to the provision. GAO analyzed CNMI government and U.S. agency data and reports, reviewed prior GAO reports, and interviewed and corresponded with officials from CNMI's government and the U.S. Departments of Homeland Security, the Interior, and Labor.
- Military Spouse Employment: Part-Time Workforce Characteristics and Perspectives What GAO FoundIn 2021, about a third of employed military spouses worked part time, based on GAO's estimates using data from the Department of Defense's (DOD) most recent survey of military spouses. Overall, GAO estimates that there were about 540,000 civilian spouses of active-duty military service members. The vast majority—around 90 percent—were women. Additionally, GAO estimates that about half of all military spouses (270,000) were employed in 2021. Of those individuals who were employed, about a third (88,000) worked part time.Military spouses GAO interviewed who worked part time reported various employment challenges, including being underpaid or overqualified for their job, lacking opportunities for career advancement, and not earning retirement benefits. Although many other civilian workers may experience similar challenges, military spouses discussed how military life—including frequent moves—contributes to their employment challenges.In DOD's 2021 survey, military spouses who worked part time reported levels of satisfaction with military life that were similar to military spouses who worked full time. However, DOD reported that, overall, military spouses' satisfaction with military life has been decreasing since 2012.Why GAO Did This StudyHouse Report 117-397 includes a provision for GAO to examine the characteristics and experiences of military spouses who work part time. GAO is providing information on the size, demographic characteristics, employment experiences, and health and well-being of this workforce.To provide this information, GAO analyzed data from DOD's 2021 Survey of Active Duty Spouses, the most recent and comprehensive data available on the employment status and well-being of military spouses at the time of GAO's review. GAO also analyzed 2021-2022 DOD administrative data on military spouses who were employed by DOD in federal civil service positions or positions at individual military bases. Finally, GAO conducted five discussion groups with a non-generalizable sample of 17 military spouses who were selected based on whether they had part-time employment experience while their spouse was on active duty, and whether they had children.For more information, contact John D. Sawyer at (202) 512-7215 or SawyerJ@gao.gov.&nbsp;
- DOD Education Activity: Civilian Payroll Remediation Continues What GAO FoundThe Department of Defense's (DOD) Education Activity operates schools around the world, providing educational services for the dependents of military service members and civilian employees. Since fiscal year 2018, independent public accounting firms auditing DOD's annual financial statements have reported more than 100 notices of findings and recommendations across the department related to the civilian payroll system. Many of these notices remain open and affect the pay of all DOD employees, including overseas civilian employees.DOD Civilian Payroll Notices of Findings and Recommendations, as of March 2023			Total									Closed									No longer applicable									Open								147 									92									8									47					Source: GAO analysis of DOD data on notices auditors issued since fiscal year 2018. | GAO-24-105679Closed notices addressed issues such as approving and maintaining time cards, gross pay reconciliation, and unsupported payroll allowances for some components of DOD. Some common issues identified in the open notices are (1) inconsistent documentation supporting employees' payrolls and (2) payroll amounts not agreeing with calculations based on supporting documentation. These open issues are similar to instances GAO observed, as discussed below. DOD has developed corrective action plans and roadmaps to remediate these open notices, but they will take time to effectively implement and address the issues that other auditors and GAO found.DOD Education Activity uses the Civilian Human Resources Agency and the Defense Finance and Accounting Service to perform human resources and payroll processing. DOD bases payroll computations on various requirements and must support payments with one or more source documents.GAO reviewed payroll records for 10 overseas DOD Education Activity employees. GAO found that the records for regular pay and incentives were accurate and contained adequate supporting documentation. GAO also found that of the five employees receiving allowances—such as for their living quarters—the amounts paid to three were inconsistent with the supporting documentation. In addition, GAO found that for eight of these 10 employees, at least one payroll deduction was not adequately supported.GAO also reviewed payroll records for 24 employees and found that 21 had adjustments that were not all processed timely or communicated adequately. The department processed 57 adjustments for the 21 employees' pay, 23 of which were retroactive, paid in a lump sum, and without many details provided on the employees' earnings and leave statements. The amount of time it took to process the adjustments ranged from a low of one biweekly pay period to a high of 34 biweekly pay periods. According to Defense Finance and Accounting Service officials, these delays are attributable to retroactive pay adjustments, corrective actions initiated by human resources offices or timekeepers, or employee-generated changes that were not sent timely for processing.Why GAO Did This StudyA committee report accompanying a national defense authorization bill for fiscal year 2022 includes a provision for GAO to review DOD's payroll system for overseas DOD Education Activity employees. This report (1) describes the status of DOD's efforts to address auditors' prior recommendations to improve its civilian payroll system, which includes overseas DOD Education Activity employees, and (2) examines the process DOD used to calculate overseas DOD Education Activity employees' pay, including base pay, differentials, additional allowances, and deductions, as well as how the department communicated payroll changes to employees.GAO reviewed an extract from a database containing all civilian payroll notices of findings and recommendations as of March 2023 to report on the status of prior recommendations. GAO also examined fiscal year 2021 payroll records (the most recent available at the time of GAO's analysis) and interviewed DOD representatives to gain an understanding of the payroll process. GAO traced payroll records for 10 employees to supporting documentation and verified the calculations using applicable criteria. GAO also reviewed payroll adjustments for 24 employees that were the result of either normal adjustments or payroll errors. Since DOD was not able to provide sufficient supporting documentation timely, the number of DOD Education Activity employees that GAO was able to review was too small to support generalizable conclusions.For more information, contact Asif A. Khan at (202) 512-9869 or khana@gao.gov.
- 2023 Tax Filing: IRS Improved Customer Service, but Could Further Improve Processing and Evaluate Expedited Hiring What GAO FoundThe Internal Revenue Service (IRS) made progress in resolving prior year challenges with processing returns during the 2023 tax filing season. By April 22, 2023, IRS had processed all prior year returns and had a backlog of 6.1 million current year returns, 10.3 million fewer than at the same point in 2022. IRS also generally reduced the average number of days to process paper returns, which vary by type. However, GAO found that IRS missed its processing time goals for some returns. In addition, some IRS monitoring reports contained data errors because IRS lacked a designated official to ensure accuracy of the reports. Furthermore, although IRS introduced efforts to improve processing, the rate of errors staff made when processing returns continued to gradually increase.Tax Documents in the IRS Kansas City, MO Processing Center, May 2023IRS generally improved its customer service to taxpayers, especially telephone service, but continued to struggle in providing correspondence services. IRS customer service representatives answered 7.7 million calls during the 2023 filing season—a 65 percent increase compared to 2022—and the average time to answer a call improved from 28 to 3 minutes. However, IRS responses to taxpayer inquiries via mail continue to be delayed, with 61 percent of inquiries considered late as of the end of the filing season. Addressing GAO's 2022 recommendation to estimate time frames for resolving these delays will better set expectations for, and potentially reduce repeat inquiries from, taxpayers.During fiscal years 2022 and 2023, IRS hired about 26,000 employees for its filing season workforce. IRS used funding from COVID-19 supplemental appropriations and the Inflation Reduction Act, along with an expedited hiring authority, to fill many of these positions. IRS has requested continued use of this authority but has not evaluated its recent expanded use. Doing so could help IRS inform efforts aimed at improving its usage of this flexibility.Why GAO Did This StudyDuring the annual tax filing season, IRS processes more than 160 million individual and business tax returns. IRS also provides telephone, correspondence, online, and in-person services to tens of millions of taxpayers. Partly as a result of the COVID-19 pandemic, IRS has faced challenges in recent years processing tax returns and refunds, meeting taxpayer service demands, and hiring employees. The Inflation Reduction Act of 2022 provided IRS tens of billions of dollars in funding to improve these and other areas.GAO was asked to review IRS's performance during the 2023 filing season. This report assesses IRS's performance on (1) processing tax returns, (2) providing customer service to taxpayers, and (3) hiring staff to support filing season operations. GAO analyzed IRS documents and filing season performance data related to tax return processing, customer service, and hiring. GAO also visited two IRS processing facilities and held discussion groups with IRS staff.
- Work Arrangements: Improved Collaboration Could Enhance Labor Force Data What GAO FoundFederal agency estimates vary widely with respect to the share of workers in nonstandard and contract work arrangements—that is, work that is not permanent, year-round employment with predictable full-time hours. Estimates range from less than 5 percent to over 30 percent of the total workforce, depending on the type of arrangement measured, how it is defined, and methodology used. In addition, limited data are available on worker outcomes, such as those relating to workplace safety, wages, and access to benefits. However, available data indicate that nonstandard and contract workers generally have fewer benefits and workplace protections than permanent, full-time employees.Data collection on nonstandard work arrangements is fragmented across at least seven federal agencies, which measure different populations and use varied terms and methodologies to meet specific purposes. This fragmentation contributes to limitations in data quality and results in varying estimates of nonstandard and contract work arrangements that are not directly comparable. As shown below, multiple terms may be used by one or more agencies to describe a single job—such as a dog walker—depending on specific circumstances.Selected Terms That May Be Applied to the Same Work (Dog Walker), by Federal EntityFederal agencies have taken some steps to address data limitations relating to nonstandard and contract workers, such as commissioning a panel to review a key survey of these workers. However, interagency efforts do not include an ongoing collaborative mechanism, such as a committee or working group, and have not been effective in addressing data quality issues or fragmentation. Agencies reported prioritizing the needs of their individual programs in their data collection efforts. Without an ongoing interagency collaborative mechanism in place—and agencies providing coordination and leadership for such an effort— agencies can risk working at cross purposes and lack incentives to prioritize crosscutting concerns. Data improvements from such an effort could help policymakers and others better understand this labor market segment and worker outcomes in it.Why GAO Did This StudyMillions of U.S. workers are in nonstandard work arrangements. Studies also indicate that increasing numbers of workers participate in contract arrangements, as employers outsource business functions once managed internally. Several federal agencies collect and use data on these work arrangements, with the Department of Labor having a prominent role. The Office of Management and Budget (OMB) supports, coordinates, and oversees federal statistical agencies' efforts.GAO was asked to review what data are available on these arrangements. This report examines the (1) prevalence of these work arrangements and worker outcomes, such as access to benefits; (2) data federal agencies collect and any limitations of the data; and (3) extent to which agencies have addressed limitations in available data.GAO reviewed studies on work arrangements and interviewed agency officials and a nongeneralizable sample of seven subject matter experts (selected in part for authoring widely cited studies). GAO also compared agency collaboration efforts against federal guidance and leading collaboration practices identified in its prior work.
- Employee Benefits Security Administration: Systematic Process Needed to Better Manage Priorities and Increased Responsibilities What GAO FoundThe Employee Benefits Security Administration (EBSA) resources have generally remained unchanged while oversight responsibilities have increased over the last decade. EBSA's Congressional Budget Justifications show that, over the 2013 to 2021 period, EBSA's annual appropriations have generally remained flat in nominal terms, but declined in inflation-adjusted terms. EBSA also experienced a decline in staffing levels (full-time equivalents) over the same period. Since 2020, EBSA's overall budget has increased due to supplemental appropriations. For example, EBSA's discretionary appropriation was $181 million each year from fiscal years 2015 through 2021. However, EBSA received supplemental appropriations in 2020 and later--$1 million in 2020, or $182 million total appropriations, and $19.2 million in 2021 or $200.2 million total appropriations. Officials said that because the agency's base budget has been flat while expenses, including those from rising wages, have continued to increase, the agency increasingly relies on supplemental funds. EBSA officials said that the agency has received many new responsibilities through legislation such as the Patient Protection and Affordable Care Act, the Families First Coronavirus Response Act, the Coronavirus Aid, Relief, and Economic Security Act, and the No Surprises Act of 2021.EBSA has employed strategies to manage resources, but does not have a systematic process to address reallocations. EBSA's strategic planning documents describe a number of strategies for managing resources that align with the three themes of our framework for managing declining resources. For example, agencies should consider both short- and long-term cost-cutting and cost-avoidance strategies—EBSA has prioritized activities with high monetary recoveries as a key long-term strategy to manage its resources.Additionally, agencies should use data analytics to guide decision-making—EBSA used data on case performance and recoveries to establish quantitative goals to increase its monetary recoveries in fiscal year 2022. Although EBSA officials said they use several strategies to manage declining resources, the agency does not have a clear or systematic decision-making process for doing so. Officials cited attempts to estimate resources for certain priorities, but these resource estimates were not acknowledged or included in planning documentation.Federal internal control standards state that agencies should use quality information and that significant changes to the agencies’ oversight, programs, and other resources should be communicated across the agency through established reporting lines to appropriate personnel. Without a systematic and well-documented decision-making process, EBSA officials may not have adequate information for making informed decisions about how to manage resource reallocations to meet its increased responsibilities.Why GAO Did This StudyEBSA is the agency within the Department of Labor (DOL) primarily responsible for ensuring that, as of fiscal year 2022, about 747,000 employer-sponsored retirement plans and about 2.5 million group health plans comply with requirements in Title I of the Employee Retirement Income Security Act of 1974. EBSA's effective oversight of plan management is critical to protect against mismanagement and fraud and to ensure that promised benefits will be available for the nearly 152 million workers, retirees, and their families covered by these plans. We previously reported on EBSA's strategies for prioritizing investigative staff as well as its enforcement process, but the current state of EBSA's resource planning is unknown.This report examines (1) how EBSA's resources and its oversight responsibilities have changed over time; and (2) the extent to which EBSA has developed a plan to strategically manage resources.GAO examined EBSA's Congressional Budget Justifications from fiscal year 2013 through fiscal year 2024 and interviewed EBSA officials. GAO reviewed relevant EBSA documents, prior GAO reports, federal studies, and federal laws and regulations regarding any new requirements for EBSA's oversight and enforcement of retirement and healthcare plans. GAO compared selected EBSA planning documentation against GAO's framework for managing declining resources. GAO also interviewed five stakeholder groups selected to obtain a range of retirement and health perspectives.
- Sole Proprietor Compliance: Treasury and IRS Have Opportunities to Reduce the Tax Gap What GAO FoundThe Department of the Treasury and the Internal Revenue Service (IRS) have not developed an overall tax gap strategy that includes specific approaches to address sole proprietor noncompliance, as GAO recommended in July 2007. Sole proprietor underreporting is one of the largest segments of the tax gap (the difference between federal income taxes owed and the amount paid). Sole proprietors are individuals who own an unincorporated business by themselves.Examples of Sole Proprietor IndustriesGAO identifies 17 options to improve sole proprietor tax compliance. The options involve tradeoffs and would best be considered as part of an overall tax gap strategy. However, Treasury officials said they have no plans to develop a strategy. Also, IRS has not taken steps to allow for voluntary withholding on payments to independent contractors, including sole proprietors, as GAO recommended in May 2020. Without voluntary withholding, these workers may find making quarterly tax payments burdensome, which may reduce compliance.IRS's strategic operating plan outlines its priorities for the coming years, but neither this plan nor other IRS documents provide an approach specifically to improve sole proprietor compliance. While IRS has some methods to assess noncompliance risk, they are not complete or specific to sole proprietors. A risk assessment would allow IRS to make strategic decisions related to enforcement and outreach priorities to help it reduce sole proprietors' share of the tax gap.IRS has a communications plan for platform workers, who are one type of sole proprietor. However, it does not have a coordinated communications plan focused on informing the wide variety of sole proprietors about their tax and reporting responsibilities. Such a plan would help sole proprietors meet their tax obligations and navigate tax law changes. According to stakeholders GAO spoke with, some sole proprietors are unaware of their tax obligations on income earned through online platforms. Additionally, stakeholders told GAO that they found the existing guidance overly technical and difficult to understand.Why GAO Did This StudyIRS attributes approximately $80 billion in unpaid taxes to sole proprietors underreporting income each year. This comprises 16 percent of the estimated annual $496 billion tax gap. In tax year 2019, roughly 27.8 million sole proprietors filed tax returns, which accounted for about 18 percent of all individual taxpayers.GAO was asked to review the tax compliance of sole proprietors. This report (1) reviews options for IRS to close the tax gap by increasing sole proprietor compliance, (2) evaluates IRS efforts to assess the risk of sole proprietor noncompliance, and (3) assesses IRS efforts to conduct outreach to improve voluntary compliance among sole proprietors.GAO reviewed literature and conducted a nongeneralizable survey of 25 experts and stakeholders on options to improve sole proprietor compliance. GAO also analyzed IRS tax gap and statistical data, reviewed agency documentation, and interviewed agency officials.
- Equal Employment Opportunity: Additional Actions Would Improve USDA's Collection and Reporting of Key Data What GAO FoundThe U.S. Department of Agriculture (USDA) submits to Congress annual reports that contain information regarding equal employment opportunity (EEO) discrimination complaints made by USDA employees. GAO examined the EEO discrimination complaint data included in two types of public reports that USDA submits to Congress: the Notification and Federal Employee Antidiscrimination and Retaliation Act (No FEAR Act) reports and the Food, Conservation, and Energy Act of 2008 (Farm Bill) reports. GAO also examined data in the nonpublic Equal Employment Opportunity Commission (EEOC) Form 462 reports that USDA files with EEOC.When examining the No FEAR Act reports and the EEOC Form 462 reports, GAO found inconsistencies in the data. For example, the reports differed on total number of complaints by basis of race (see figure). Representatives from USDA's EEO database vendor investigated and found that sometime before 2015, a database user had manually added “Hispanic/Latino” as an option for race for the No FEAR Act reports. However, “Hispanic/Latino” should be reported as national origin, according to EEOC guidance. By updating the database so that “Hispanic/Latino” only appears on the list of options for complaints by the basis of national origin, USDA will better ensure its No FEAR Act reports are accurate and in line with EEOC guidance. Furthermore, by disclosing this error on its website for past reports, USDA will better ensure the information it publishes is transparent.USDA's Average Number of Complaints by Race Basis per Year, Fiscal Years 2015-2022GAO also found errors, incomplete source information, and unexplained changes in sources regarding the EEO discrimination complaint data included in some of USDA's Farm Bill reports. For example, USDA's Office of the Assistant Secretary for Civil Rights (OASCR) changed a source for its analysis of per capita complaints but did not explain the change in the affected reports. Additionally, none of the Farm Bill reports GAO reviewed included an explanation of the methods OASCR used to conduct the analyses in these reports. OASCR also does not have a staff-level review process in which someone independent from the work itself verifies that key facts, figures, and findings in the reports align with the sources and are correct. By including a section in USDA's Farm Bill reports that explains the methods OASCR staff used to analyze EEO discrimination complaints and implementing a process to review the quality of information, as called for in USDA guidance, OASCR would better ensure the transparency, accuracy, clarity, and completeness of information in its reports.Why GAO Did This StudyThe annual reports on employment discrimination complaint data that USDA submits to Congress play an important role in congressional oversight of USDA's compliance with federal laws. For effective oversight, the data in these reports need to be accurate, clear, and complete.As part of a larger review in response to a provision in the Agricultural Improvement Act of 2018, GAO identified discrepancies in USDA's data and reporting on EEO discrimination complaints. This report is intended to bring these issues to the attention of USDA. In conducting its work, GAO compared data across the No FEAR Act, EEOC Form 462, and Farm Bill reports. GAO also reviewed USDA guidance and interviewed agency officials and representatives of the EEO database vendor.
- Veterans Employment: Identifying Lessons Learned from Rapid Retraining Program Could Benefit Future Efforts What GAO FoundThe Department of Veterans Affairs (VA) implemented the Veterans Rapid Retraining Assistance Program (VRRAP). VRRAP included up to 12 months of housing and tuition assistance for veterans who lost their jobs because of the COVID-19 pandemic. VA certified the majority of applicants for VRRAP and obligated the majority of VRRAP funding, with some challenges reported by stakeholders. VA certified 22,851 of the 31,625 VRRAP applicants as eligible to participate in the program. Of those certified VRRAP applicants, over 50 percent enrolled in an education program, 19 percent went on to complete their education program, and 5 percent of those originally certified obtained employment. As of April 2023, VA reported that it had obligated 95 percent of the $386 million in VRRAP funds. VA spent an average of $17,270 per veteran. Selected stakeholders reported program benefits, such as the assistance the program provided to veterans without other educational resources. Stakeholders also reported challenges, such as VA's delayed program outreach efforts to veterans.In implementing VRRAP, VA collected data on VRRAP participants as well as feedback from veterans and schools. These data highlight a number of program benefits and challenges, such as when participants found employment or issues with the amount or quality of support veterans received from VA, but VA had no plans to analyze the lessons that can be learned from its experience operating the program or validate and document them for future use. By implementing the key practices of a lessons-learned process, VA can leverage data it has already collected and improve future programs with insights from VRRAP (see fig.).Key Practices of a Lessons-Learned ProcessWhy GAO Did This StudyVA carried out VRRAP as directed by the American Rescue Plan Act of 2021. Later in 2021, the Training in High-demand Roles to Improve Veteran Employment Act made changes to VRRAP and includes a provision for GAO to report on the outcomes and effectiveness of VRRAP. This report reviews (1) VA's outreach efforts, VRRAP applications processed, and demographics for participating veterans; (2) program funds used and outcomes for participating veterans; (3) VRRAP benefits and challenges reported by surveyed veterans, selected veteran service organizations (VSO), and selected schools; and (4) steps VA has taken to identify lessons learned in the design and implementation of VRRAP.To address the first two objectives, GAO analyzed VA data from March 2021 to December 2022 on its outreach efforts, analyzed VA data from April 2021 through March 2023 on participating veterans, analyzed VA data on participating schools as of February 2023, and analyzed Census American Community Survey data from 2021. To address the third and fourth objectives, GAO reviewed VA data from a survey of VRRAP participants and interviewed VA officials as well as nonrepresentative samples of four VSOs and nine participating schools. For the fourth objective, GAO also assessed VA's efforts to implement six key practices for collecting and using lessons learned.
- Unemployment Insurance: Estimated Amount of Fraud During Pandemic Likely Between $100 Billion and $135 Billion What GAO FoundBased on statistical sampling and imputation techniques, GAO estimates that the amount of fraud in unemployment insurance (UI) programs during the COVID-19 pandemic was likely between $100 billion and $135 billion. This is about 11 percent and 15 percent, respectively, of the total amount of UI benefits paid during the pandemic. GAO's estimate is for the period from April 2020 (first full month of payments from all UI programs) to May 2023 (end of the public health emergency). This estimate covers all 53 states that participated in the regular and temporary UI programs. The full extent of UI fraud during the pandemic will likely never be known with certainty. In commenting on a draft of this report, the Department of Labor (DOL) expressed concerns about GAO's fraud estimation methodology and stated that the resulting estimate was likely overstated. GAO disagrees and explains in the report the steps taken to estimate the range of fraud. These steps include using (1) a 95-percent confidence interval to account for sample design and size, and (2) multiple data sources and validity checks to account for uncertainty associated with identifying potential fraud in its sample.During the pandemic, DOL provided states with assistance to improve UI systems and processes. As of July 2023, DOL reported allocating grants totaling about $1.4 billion to states for initiatives including fraud prevention, detection, investigation, and recovery. Officials from selected states confirmed that they used this assistance for fraud detection and prevention, including verification software and improvements in payment timeliness.Coronavirus Aid, Relief, and Economic Security (CARES) Act and American Rescue Plan Act (ARPA) Unemployment Insurance (UI) Financial AssistanceAs of May 1, 2023, states reported identifying about $55.8 billion in fraudulent and nonfraudulent UI overpayments and recoveries of about $6.8 billion from March 2020 through March 2023. During this period, states reported identifying fraudulent UI overpayments totaling $5.3 billion and recoveries of $1.2 billion. States use several tools to recover overpayments, including direct repayment and offsets. States can also write off overpayments as uncollectible. Further, states may waive their legal right to collect nonfraudulent overpayments. DOL rules do not allow states to waive fraudulent overpayments.Why GAO Did This StudyThe UI system has faced long-standing challenges with program integrity, which worsened during the COVID-19 pandemic. In response to historic pandemic job losses, Congress created new temporary UI programs to provide relief for the unemployed. The unprecedented demand for benefits and need to quickly implement the new programs increased the risk of fraud. Due to this and other challenges, GAO added the UI system to its High Risk List in June 2022.This report (1) provides an estimate of fraud within UI programs during the pandemic; (2) identifies the assistance DOL provided to states; and (3) presents amounts that states reported in UI overpayment recoveries and waivers, among other amounts. GAO used data from multiple sources to produce an estimated range of the extent of fraud during the pandemic. In determining the estimate, GAO reviewed DOL data, selected and reviewed a sample of payments, matched samples to other federal data bases, developed an econometric model on claims and economic conditions, and performed numerous other analyses. GAO also reviewed data on state-reported overpayments, recoveries, and waivers. GAO interviewed officials from 14 states, selected based on fraud risk and other factors.
- VA Equal Employment Opportunity: Increased Attention Needed to Improve Program Effectiveness What GAO FoundThe Department of Veterans Affairs (VA) has a diverse workforce, but disparities exist in career outcomes. GAO found that VA had higher representation of certain historically underrepresented racial and ethnic groups from fiscal years 2017 to 2021 than the national civilian labor force from 2014 to 2018 (the most recent data available). However, within VA's workforce, GAO estimated that from 2000 to 2021, certain of these groups hired into similar occupations had lower pay and attained fewer promotions than White men, on average (see figure).Estimated Differences in Promotions of Department of Veterans Affairs (VA) workers Hired into Similar Jobs 10 years after Starting Employment, by Race, Ethnicity, and Gender, Fiscal Years 2000-2021 (Percent Difference Relative to White Men)VA tracks complaints of alleged racial discrimination and harassment, but has not fully analyzed other data to understand potential prevalence. While VA has a goal to develop a dashboard to assess data on workplace climate, it has not planned for or conducted this analysis. Until doing so, VA is not best positioned to identify and address trends in potential discrimination and harassment.The continued misalignment of its equal employment opportunity (EEO) program with a federal directive hinders VA's ability to prevent and address employment discrimination. In 2020, GAO recommended that VA address these misalignment issues by ensuring VA's EEO director is not responsible for personnel functions and completing VA's planned realignment of its EEO Program Managers. As of April 2023, VA has not taken action to fully implement these recommendations.While VA has several programs that can receive complaints from veterans who feel they have been discriminated against in VA programs, it does not have a comprehensive policy to ensure complaints are addressed. This created several issues, such as (1) inconsistent processing of complaints; (2) lack of communication with veterans; (3) lack of coordination across the offices receiving complaints; and (4) lack of data on complaints. As a result, VA may not have visibility into whether veterans' complaints have been fully addressed, or the potential extent of discrimination against veterans in VA programs.Why GAO Did This StudyFederal law prohibits employment discrimination against federal employees and discrimination in federal programs on the basis of race, among other things. GAO was asked to review VA's efforts to ensure equitable treatment of its employees and veterans receiving its services or participating in its programs.This report examines (1) what disparities, if any, exist between VA employees from different racial and ethnic groups; (2) how VA tracks potential racial discrimination against its employees; (3) the extent to which VA has practices to prevent and address employment discrimination; and (4) how VA assesses and addresses issues related to the treatment of veterans based on race in VA programs. GAO reviewed relevant federal laws, and VA policies and documents; analyzed employee personnel data, survey data, and data on EEO complaints; held discussion groups with VA employees; and interviewed VA officials, representatives from VA's unions, employee affinity groups, and veterans service organizations.
- Job Corps: DOL Could Improve Center Safety and Security Procedures and Assess Hiring Flexibilities for Drug Intervention Specialists What GAO FoundAlthough four of the six selected Job Corps centers' safety and security protocols GAO reviewed included required elements to prevent illegal drugs from entering their campuses, two centers' protocol documents did not, but were approved by the Department of Labor (DOL). DOL national officials told GAO that they provide guidance on minimum requirements for the protocol documents, and the regions should not approve documents omitting required elements. However, GAO found that the broad guidance lacked the written procedures needed for regional offices to identify missing elements. Without such procedures, regional officials may continue to approve incomplete protocol documents, diminishing centers' efforts to prevent drugs from entering their campuses.In program year 2018, 30 percent of students tested positive for drug use on program entry, and 61 percent of these students subsequently tested negative during follow-up drug tests, according to GAO's analysis (see figure). About 51 percent of these students completed an educational or technical training credential, compared to about 58 percent of students who tested negative for drug use on entry. After drug tests administered at entry to all students and follow-up drug tests for students testing positive at entry, students are not tested again unless there is reasonable suspicion of drug use.Drug Test Results for Students Who Enrolled in Job Corps in Program Year 2018Difficulties recruiting and retaining qualified specialists negatively affect a center's ability to provide intervention services to students who test positive for drugs, according to officials GAO interviewed in five of six selected centers. DOL requires intervention specialists to have a drug abuse counseling certification in the state where the center is located, but allows centers to waive the certification requirement for one year. Some centers used waivers over consecutive years, according to DOL information, indicating prolonged challenges recruiting certified specialists and retaining those hired using a waiver. DOL officials said the agency has not assessed specific options to address these hiring challenges. This would help ensure that centers are positioned to provide intervention services to help students successfully complete the program.Why GAO Did This StudyJob Corps centers must ensure federally illegal drugs are not permitted on campus, and are required to test students for drug use within 48 hours of their arrival. Students testing positive must receive intervention services and be retested 37 to 40 days later. A subsequent positive test result is grounds for termination from the program.GAO was asked to review Job Corps. Among other objectives, GAO examined (1) the extent to which selected Job Corps centers' safety and security protocol documents included minimum requirements, (2) the progress of students testing positive for drug use, and (3) perspectives of staff at selected centers on challenges assisting students.GAO analyzed program year 2018 (the most recent complete data prior to the COVID-19 pandemic) DOL and contractor data on drug testing and program completion. GAO also selected a nongeneralizable sample of six Job Corps centers to include a range of drug test rates, center sizes, and locations. GAO reviewed current center security protocols, interviewed officials, and distributed a student questionnaire from July through August 2022.
- Telework: Growth Supported Economic Activity During the Pandemic, but Future Impacts Are Uncertain What GAO FoundThe percentage of workers who worked from home (teleworked) rose sharply between 2019 and 2021 (see figure). The increase was concentrated among workers with higher earnings and education and in certain occupations, according to GAO's analysis of nationally representative survey data. Specifically, GAO's analysis of the American Time Use Survey (ATUS) found that the estimated percentage of workers who teleworked for any portion of an average workday increased from 24 percent in 2019 to 38 percent in 2021. Similarly, GAO's analysis of the American Community Survey (ACS) found that the estimated percentage of workers who primarily teleworked in the prior work week more than tripled from 5.7 percent in 2019 to 17.9 percent in 2021. The extent of telework also varied across occupations. For example, 28 percent of workers in management and related occupations primarily worked from home in 2021 compared to 7.5 percent of workers in service occupations. Despite increases in telework, most workers did not telework in 2021.Estimated Percentage of U.S. Workers Who Primarily Worked from Home and Who Did Any Work at Home on an Average Workday, and during the Week, 2010–2021aData for 2020 are not shown because ACS 2020 1-year data and the 2020 annual ATUS estimates failed to meet Census Bureau's quality standards for publication.Studies GAO reviewed found that telework generally had a positive impact on worker productivity and firm performance in certain sectors, but methodological issues complicate efforts to estimate its long-term impacts. For example, a study of a Chinese call center found that telework increased productivity by 13 percent. Some studies also found that telework mitigated the negative impact of the pandemic on firm performance and the economy. Estimating the long-term impacts of telework is difficult however because some economic effects may emerge only over time. For example, studies GAO reviewed identified potential cost savings from reduced office space needs and potential collaboration challenges that could impact worker productivity or firm performance in the longer run.Why GAO Did This StudyFor many years, employers have used telework to manage their business operations and to promote a better work-life balance for their employees. In this report, telework refers to a flexible work arrangement under which employees perform their duties from a worksite—often at home—other than the location from which they would otherwise work. More recently, telework became an important part of the national response to the COVID-19 pandemic, which emerged in the U.S. in early 2020.GAO was asked to examine the impact of telework, both as it pertains to the workforce and various sectors of the economy. This report is the first in a series of reports that will respond to this request, and examines: (1) changes in the extent of telework in the United States before and during the COVID-19 pandemic, and (2) reported impacts of teleworking on worker productivity and firm performance. Subsequent reports will focus on public policies affecting telework, among other issues.GAO used the ACS and ATUS to describe trends in the use of telework from 2010 through 2021, the most recent data available at the time of the analysis in May 2023, and the growth of telework by select worker characteristics between 2019 and 2021. GAO also reviewed 44 studies that met GAO criteria for methodological rigor and examined the relationship between telework and worker productivity and firm performance.For more information, contact Michael Hoffman at (202) 512-6445 or hoffmanme@gao.gov, or John Sawyer at (202) 512-7215 or sawyerj@gao.gov.
- Older Workers: Retirement Account Disparities Have Increased by Income and Persisted by Race Over Time What GAO FoundDisparities between low-income and high-income older workers' retirement accounts were greater in 2019 than in 2007, according to GAO's analysis of Survey of Consumer Finances (SCF) data on households 51 to 64. For example, about one in 10 low-income households had a retirement account balance in 2019 compared to about one in five in 2007, while about nine in 10 high-income households had a balance through the period. For those with a balance, the median balance was higher for high-income households over the period, while any change for the other income groups was not statistically significant. Racial disparities also persisted over the period. A higher share of White households had a balance than those of all other races. Also, White households had about double the median balance as households of all other races.Estimated Retirement Account Balances for Households Age 51-64 with a Balance, by IncomeNote: Brackets represent 95 percent confidence intervals. Overlapping brackets for the lowest and middle income quintiles indicate no statistically significant difference between 2007 and 2019.Income, job-related factors, and race were strongly related to disparities in older worker households' retirement account balances, according to GAO's analysis of 2018 Health and Retirement Study (HRS) data. High-income households contributed a larger percentage of their pay than low-income households (about 8 and 5 percent) and received larger employer contributions. Households with higher income, longer job tenure, and a college education tended to have larger balances. Households of all other races than White and households with children had about 28 and 20 percent smaller balances, respectively.  The effects of selected strategies meant to increase workplace retirement savings vary across workers of different income groups, according to illustrative scenarios using GAO's analysis of SCF and HRS data. For example, automatic enrollment can increase participation of low-income older workers with access up to about one-third. However, only about 23 percent of low-income workers have access to a workplace retirement account. Further, they may choose not to participate, for example, if they have limited disposable income or expect Social Security to provide most of their retirement income. In contrast, increasing contribution limits for workplace retirement accounts almost entirely benefits high-income workers, as about 23 percent of high-income compared with about 3 percent of middle-income older workers contribute the individual limit.Why GAO Did This StudyIn 2022, the tax incentives for workers to save in tax-preferred retirement accounts cost the federal government nearly $200 billion in forgone revenue, according to the Department of the Treasury. Members of Congress and others are concerned these incentives accrue primarily to high-income workers and not low-income workers. Knowing the distribution of retirement account balances can help illuminate the retirement security of households of different incomes.GAO was asked to examine disparities in the distribution of retirement account balances. This report describes, among other issues, (1) how the distribution of retirement account balances among older households by income changed over time; (2) factors associated with the distribution of retirement account balances   among older households by income; and (3) how selected strategies meant to increase retirement savings affect high-, middle-, and low-income workers.GAO examined retirement account balances for older workers' households (age 51 to 64) over time using 2007-2019 SCF data. GAO analyzed 2018 HRS data to identify factors associated with the balance distribution. Both datasets were the most recent data available at the time of GAO's review. GAO crafted illustrative scenarios to show the effects of four strategies meant to increase retirement savings using SCF, HRS, and 2018 Internal Revenue Service Statistics of Income data. GAO selected these strategies with input from agency officials, federal reports, and experts. GAO also reviewed relevant literature and interviewed retirement security experts.For more information, contact Tranchau (Kris) T. Nguyen at (202) 512-7215 or NguyenTT@gao.gov.
- Unemployment Insurance: DOL Needs to Further Help States Overcome IT Modernization Challenges What GAO FoundThe eight states in GAO's study were in varying phases of modernizing their unemployment insurance (UI) IT systems, ranging from planning to operations and maintenance. As of February 2023, six of the eight states had modernization efforts underway, but not yet completed. According to officials from the six states, these efforts were expected to replace legacy UI systems that ranged from 7 to about 50 years old. The remaining two states completed modernization efforts in 2018 and 2021 and were in the operations and maintenance phase. To support their modernization efforts, the eight states rely extensively on contractors for system development and implementation, technical support, and identity verification.The selected states reported several modernization successes. For example, states reported improved system stability after migrating systems to cloud computing solutions and a reduction in paper-based UI processes. However, states also identified modernization challenges in five areas: staffing, contracting, management, financial, and technical (see figure).Eight States' Unemployment Insurance IT System Modernization Challenge AreasRegarding staffing, most states reported not having enough staff resources and not having staff with the necessary expertise to support their modernization efforts. To help states address modernization challenges, the Department of Labor (DOL) initiated several efforts, such as sending teams of experts to states and conducting pilot tests of UI technology solutions for states.DOL has gaps in managing its efforts to assist states' with UI IT modernization and its oversight of states' UI IT performance. Although DOL fully implemented key contract management activities on its first pilot, the department did not fully implement leading pilot design practices such as developing a data analysis plan and ensuring stakeholder communication. Without fully implementing leading pilot design practices, DOL likely cannot ensure its future pilots produce information needed to make effective program and policy decisions. Regarding oversight, although DOL is responsible for overseeing the UI program to ensure that the states are operating the program effectively and efficiently, it has not measured states' UI IT performance. Until DOL finalizes IT standards and measures state UI IT performance, the department will be limited in its ability to monitor whether states' UI systems are performing efficiently and effectively.Why GAO Did This StudyIn the wake of the COVID-19 pandemic, the nation experienced historic levels of job loss. According to DOL data, approximately $878 billion in benefits were paid across all UI programs from April 2020 to September 2022. However, state UI programs with legacy IT systems faced performance issues in processing the unprecedented number of UI claims. Due to this challenge and others, GAO added the overarching UI system to its High-Risk List in June 2022.GAO was asked to review UI IT modernization issues. The specific objectives were to (1) provide the status of modernization efforts for selected states, including the role of contracting; (2) identify notable modernization successes and challenges; and (3) evaluate DOL's management activities in assisting states and overseeing their efforts.To do so, GAO analyzed documentation and interviewed state officials from a nongeneralizable sample of eight states (selected based on varying location and population size, among other criteria). GAO also reviewed relevant DOL policies and guidance documents and compared them to key management and oversight activities. In addition, GAO interviewed department officials.
- 403(b) Retirement Plans: Department of Labor Should Update Educational Materials to Better Inform Plan Sponsors and Participants What GAO FoundMillions of teachers and employees of tax-exempt organizations invest in 403(b) retirement plans. The Department of Labor (DOL), Securities and Exchange Commission (SEC), and Internal Revenue Service (IRS) take steps to oversee some 403(b) plans or their investment options, or both. Specifically, DOL oversees 403(b) plans subject to the Employee Retirement Income Security Act of 1974, as amended (ERISA), and uses a range of strategies to identify plans to investigate for compliance with the law. For example, DOL has investigated instances of self-dealing—when a plan fiduciary uses plan assets for the fiduciary's own interest or own account. The SEC's oversight focuses on compliance with securities laws and regulations, while the IRS's oversight focuses on compliance with the Internal Revenue Code. DOL, SEC, and IRS also conduct outreach and provide educational materials to 403(b) plan sponsors and participants. However, DOL's website does not contain targeted educational materials that could help participants understand 403(b) plan fees. Updated DOL information on 403(b) plans could help participants make more informed decisions.GAO reviewed how five selected states worked to improve outcomes—including in some cases reducing fees participants pay—in 403(b) plans that are not subject to ERISA requirements. Officials in three of the states said they had consolidated the number of service providers offering investment options, which strengthened oversight by reducing the number of service providers they had to oversee. Officials in Connecticut told GAO consolidating service providers also resulted in lower annual fees for participants (see figure). Officials in four of the selected states said they enhanced transparency by providing participants with additional information on plans' investment options and fees or by making it available elsewhere.Connecticut: Average Investment Fees Pre- and Post-2004 Consolidation Stakeholders and experts identified actions they said could improve 403(b) participant outcomes. For example, they suggested establishing fiduciary duties for non-ERISA plans in some states that are not subject to such protections can help protect participants' interests. Also, they said requiring distribution of standardized information on investment options' returns and fees for participants in non-ERISA plans would promote transparency. Multiple experts also suggested that allowing 403(b) plans to use certain other investment vehicles could reduce fees.Why GAO Did This StudyLike 401(k) plans, 403(b) plans are account-based defined contribution plans sponsored by employers. Many 403(b) plans are subject to ERISA requirements and are intended to protect the interests of plan participants. However, some 403(b) plans are not covered by ERISA.GAO was asked to review (1) the extent of federal agencies' 403(b) plan oversight, (2) actions by selected states that could improve 403(b) participant outcomes, and (3) options stakeholders and experts have identified that could improve outcomes for 403(b) participants.GAO analyzed DOL, SEC, and IRS data and documentation; reviewed documentation from five selected states identified as taking actions to improve participant outcomes; interviewed federal and state agency officials and experts; and conducted and analyzed results from surveys of plan sponsors and service providers about options to improve participant outcomes. The analysis of state actions and survey results offer a range of perspectives on improving participant outcomes but are not generalizable.
- Veterans Employment: GI Bill Benefits Can Help Lead to Outdoor Recreation Careers What GAO FoundEligible veterans can use the GI Bill and other education benefits from the Department of Veterans Affairs (VA) to pursue certificate or college degree programs related to outdoor recreation. This is a $159 billion industry involving outdoor physical activities, such as skiing or fishing, according to a 2021 federal estimate. GAO identified 34 GI Bill-approved certificate programs and about 1,400 college degree programs related to outdoor recreation. However, veterans may face challenges pursuing outdoor recreation education, such as the seasonality or specific locations of some programs. For example, some courses in avalanche rescue are available only in mountainous regions during the winter.  Examples of Veterans' Potential Education Pathways to Outdoor Recreation Careers Using Department of Veterans Affairs (VA) BenefitsIn 2021 federal agencies employed about 4,900 veterans in a number of outdoor recreation positions. These veterans comprised 11 percent of the more than 44,000 federal outdoor recreation employees, according to GAO's analysis of Office of Personnel Management (OPM) data. GAO identified 11 federal outdoor recreation positions at the Departments of Agriculture and the Interior, National Oceanic and Atmospheric Administration (NOAA), and the U.S. Army Corps of Engineers. Officials at these agencies told GAO that they attract veterans to outdoor recreation positions through career fairs, internships, and other programs or initiatives. More than one-third of these employees hold seasonal or part-time jobs. This can deter veterans seeking full-time, year-round employment from pursuing these careers. Further, federal officials told GAO that some outdoor recreation jobs are entry level and low paying, and thus may not be a good fit for veterans who are transitioning to civilian employment mid-career.Most Common Federal Outdoor Recreation Positions for Veterans, as of 2021			Outdoor recreation position category 									Number of veterans employed 								Forestry technician									1,710								General natural resources management and biological sciences									967								Maintenance mechanic (e.g., trail worker)									959								Park ranger									732					Source: GAO analysis of September 2021 Office of Personnel Management data for selected agencies.Note: For more details, see Table 1 in GAO-23-106149.Why GAO Did This StudySome veterans leave military service with wilderness survival and other skills related to outdoor recreation. VA also provides eligible veterans with benefits to pursue additional education and training. However, little is known about the educational or employment pathways for veterans into the outdoor recreation sector.The Consolidated Appropriations Act, 2022, includes provisions for GAO to review veterans' use of educational benefits and pursuit of careers in outdoor recreation. This report describes the opportunities and challenges for veterans to (1) use the GI Bill and other VA benefits toward outdoor recreation education and (2) pursue federal employment in outdoor recreation.GAO identified GI Bill-approved outdoor recreation education programs as of 2022 using VA and Department of Education data. GAO also analyzed 2021 OPM data—the most recent available—on federal employment at four agencies with missions connected to the outdoors: the Departments of Agriculture and the Interior, NOAA, and the U.S. Army Corps of Engineers. GAO also interviewed officials at these four agencies and reviewed relevant federal laws and regulations.In addition, GAO interviewed officials at VA and outdoor recreation certificate programs selected based on veteran enrollment and approval for VA educational benefits. GAO also interviewed representatives of an outdoor recreation industry association and veteran advocacy groups.For more information, contact Melissa Emrey-Arras at (617) 788-0534 or emreyarrasm@gao.gov.
- Priority Open Recommendations: Department of Labor What GAO FoundIn July 2022, GAO identified twelve priority recommendations for the Department of Labor (DOL). Since then, DOL implemented two recommendations by: (1) revising a Memorandum of Understanding to improve collaboration to ensure the safety of meat and poultry workers, and setting time frames to evaluate the memorandum; and (2) taking steps to ensure employers submit injury and illness data when required, and better identify employers who are out of compliance with this reporting requirement.In May 2023, GAO identified one additional priority recommendation for DOL, bringing the total number to 11. These 11 recommendations involve the following areas:stronger protections for wage earners,	enhancing unemployment insurance; and	protecting sensitive information.DOL's attention to these issues could lead to significant improvements in government operations.Why GAO Did This StudyPriority open recommendations are the GAO recommendations that warrant priority attention from heads of key departments or agencies because their implementation could save large amounts of money; improve congressional and/or executive branch decision-making on major issues; eliminate mismanagement, fraud, and abuse; or ensure that programs comply with laws and funds are legally spent, among other benefits. Since 2015 GAO has sent letters to selected agencies to highlight the importance of implementing such recommendations.For more information, contact Cindy Brown Barnes (202) 512-7215 or brownbarnesc@gao.gov.
- Noncompete Agreements: Use is Widespread to Protect Business' Stated Interests, Restricts Job Mobility, and May Affect Wages What GAO FoundTwo recent nationally representative studies GAO reviewed estimated that 18 percent of workers were subject to noncompete agreements (NCAs), and one of the studies estimated that 38 percent of workers had been subject to an NCA at some time in their careers. Over half of the 446 private sector employers responding to GAO's survey reported that at least some of their workers had NCAs. Studies and GAO's employer survey also found that different types of workers are required to sign NCAs, including executives and hourly workers. For example, over 70 percent of respondents that use NCAs and that employed hourly workers used NCAs for at least some of them (see fig.).Noncompete Agreements (NCAs) by Worker Type, among Responding Employers Using NCAsEmployers GAO surveyed most often reported using NCAs to protect certain confidential information from competitors, regardless of worker type. However, several stakeholders GAO interviewed said that lower-wage workers generally do not have access to such information. Evidence suggests that workers who sign NCAs often do so as a condition of employment. Evidence also suggests that few workers who sign NCAs negotiate the terms, because they are unaware of what NCAs are, they want the job regardless, or the NCA is introduced after a job is accepted. Most surveyed employers reported rarely or never enforcing NCAs in the past 5 years. Employers that reported enforcing NCAs reported doing so for all worker types, though most often for executives and managers.Studies GAO reviewed found that NCAs restrict job mobility, and may reduce wages and new firm creation. Two of these studies found that even when NCAs are not legally enforceable in a state, NCAs reduce job mobility and workers with NCAs are less likely to search for new jobs. Studies also found that NCAs lower workers' earnings, on average, though certain groups like executives may experience mixed effects. In addition, studies found that NCAs may discourage workers from starting new firms.Of the 26 attorney general offices that responded to GAO's survey, 6 reported not having NCA-related statutes, 3 reported a statute that generally allows NCAs, and one reported a statute that generally does not allow NCAs. In addition, 16 reported a statute that allows NCAs, subject to certain provisions; for example, exempting workers who earn less than a certain wage from NCAs or requiring employers to provide written notice of an NCA to workers before they start a job.Why GAO Did This StudyNCAs are provisions in employment contracts that can restrict workers from seeking employment with a competitor. Employers historically have applied NCAs to highly skilled workers and executives with access to proprietary information, such as trade secrets. NCAs generally are governed by state law. Questions have been raised about employers' use of NCAs, and their effects on lower-wage workers who may not have access to protected proprietary information.GAO was asked to review the use and effects of NCAs. This report examines (1) the prevalence of NCAs, including for various types of workers; (2) what factors influence employers' and employees' decisions to enter into NCAs; (3) the effects of NCAs on the workforce and firms; and (4) steps states have taken to regulate NCAs.GAO reviewed empirical studies on the prevalence and economic effects of NCAs. GAO also conducted a nongeneralizable survey of private sector employers on the reasons they use and enforce NCAs; 446 employers responded to the survey. GAO conducted a separate survey of state attorney general offices on state statutes related to NCAs; 25 states and the District of Columbia responded. GAO also interviewed stakeholders, such as worker advocates, employer groups, and researchers, and reviewed relevant federal laws.The Department of Justice and Federal Trade Commission (FTC) provided technical comments on this report, which GAO incorporated, as appropriate. FTC also provided a comment letter with additional context from its research on NCAs.For more information, contact Thomas Costa at (202) 512-4769 or costat@gao.gov.
- Department of Education: Employment Information for Key Grant Programs that Foster Expertise in World Languages and Cultures What GAO FoundThe Department of Education's Foreign Language and Area Studies (FLAS) Fellowship and National Resource Center (NRC) grant programs fund education in the languages and cultures of world areas (e.g. Africa, East Asia) in different ways. While the FLAS program provides universities with grants that they then use to fund fellowships for individual students, the NRC program supports the operation of academic centers at the university level. NRCs fund activities such as curriculum development, language instruction, and outreach to community partners (e.g., government agencies or K-12 schools). GAO reviewed descriptions in applications from 27 grantee universities about how their NRC and/or FLAS grants would encourage employment in areas of need and identified the following activities as the most common:Helping students develop skills in languages (23 of 27), such as Arabic or Chinese, that are needed in the federal government or other sectors.	Offering career services (21 of 27), such as hosting workshops about job-seeking skills (e.g., resume writing) and publicizing relevant internships.	Helping students develop knowledge about world areas (21 of 27), such as equipping them with cultural competencies to navigate the global economy.	Collaborating with community partners (20 of 27), such as helping to develop a Global Workforce Skills Certificate for community colleges.Because FLAS awards fellowships to individuals, Education periodically surveys program graduates about their employment. GAO analyzed responses from the most recent survey (1,991 respondents who graduated between 2010 and 2018 out of 4,728 survey recipients). Of the 1,260 respondents who reported their employment sector, more reported that they worked in the private or non-profit sectors than in government (see figure below). About 46 percent of 1,881 survey question respondents reported that they had consulted or volunteered in one of a variety of employment sectors, most commonly for a domestic (about 10 percent) or international (about 8 percent) non-profit organization.Employment Sectors Reported by FLAS Graduates Who Responded to 2019 SurveyNote: The percentages are approximate and add up to more than 100 due to rounding. Of the 1,991 respondents, 1,260 answered the survey question about employment sectors.aEducation did not define the “other” category in its FLAS survey.Why GAO Did This StudyIn today's interconnected world, many career fields—such as diplomacy, national security, and business—need individuals with knowledge about world languages and cultures. To address these areas of needed expertise—both at the federal level as well as in the education, business, and nonprofit sectors—the Higher Education Act of 1965, as amended, authorizes the FLAS and NRC grant programs. GAO was asked to review how these programs support employment in areas of need.Among other issues, this report addresses how selected grantee universities describe encouraging employment in areas of need in their grant applications, and what Education's most recent survey of FLAS graduates shows about respondents' employment outcomes.GAO reviewed relevant application narratives from a non-generalizable sample of 27 NRC grantee universities (25 of which were also FLAS grantees) and grouped employment activities described by grantees into nine categories. These grantees comprised about 23 percent of all fiscal year 2022 NRC and FLAS grantee universities. GAO also analyzed the results from Education's 2019 survey of FLAS graduates, the most recent available. Due to the differences in the structure of the FLAS and NRC programs, Education does not administer a similar survey to NRC grantees. In addition, GAO reviewed relevant federal laws and regulations and program documents, and interviewed officials from Education.For more information, contact Melissa Emrey-Arras at (617) 788-0534 or emreyarrasm@gao.gov.
- National Labor Relations Board: New Protocols Aim to Prevent Errors When Swearing in Board Members What GAO FoundThe National Labor Relations Board (NLRB) failed to ensure that a Senate-confirmed Board nominee's presidential commission had been signed prior to administering the oath of office, but the agency has since added internal controls to avoid future mistakes. Although NLRB's protocols in place at the time instructed an official to ensure that the commission was signed as soon as possible after Senate confirmation before administering the oath of office, NLRB did not follow those protocols. Based on a review of that error, NLRB revised its protocols to include several new steps to ensure proper administration of the oath of office. For example, NLRB established a committee for handling presidential appointments consisting of six senior officials to ensure that the commission is signed prior to administering the oath of office.Why GAO Did This StudyNLRB, a federal agency in the executive branch created in part to eliminate unfair labor practices, is headed by a five-member Board and General Counsel. Each Board member is to be appointed in accordance with the Appointments Clause of the U.S. Constitution, which means that Board members are to be nominated by the President and confirmed by the Senate. After Senate confirmation, the President can then appoint the confirmed nominee to the position. This appointment is typically memorialized by a signed presidential commission. On July 28, 2021, a nominee to the Board was confirmed by the Senate. On August 28, 2021, NLRB administered the oath of office to the confirmed nominee, believing that he had received a signed presidential commission appointing him to the position. However, on September 22, 2021, NLRB Chairman learned that the confirmed nominee had not previously received his signed presidential commission and, therefore, had not been appointed to the position. On the same day, the confirmed nominee received his signed presidential commission effectuating his appointment to the position, and the Chairman re-administered the oath of office to him.GAO was asked to examine what led to NLRB administering the oath of office prior to receiving a signed presidential commission, and any procedures NLRB has implemented to prevent a similar error from occurring in the future.This report examines why an NLRB member was sworn in prior to receiving a signed presidential commission and the actions the NLRB has taken to ensure that such an error will not happen in the future.To address our objective, we interviewed NLRB officials and collected documentary evidence regarding: (1) NLRB's protocols for swearing in members as of August 2021; (2) the steps that resulted in the nominee being sworn in prior to receiving a signed presidential commission; and (3) actions NLRB has taken to prevent this error from occurring again, such as revising its protocols to swear in new members. Additionally, we reviewed relevant federal laws, regulations, and guidance, along with prior GAO work.In a separate product, we examined the legal implications of the member's service prior to his presidential appointment.For more information, contact Tom Costa at (202) 512-7215 or costat@gao.gov.
- Women in the Workforce: Underrepresentation in Management Positions Persists, and the Gender Pay Gap Varies by Industry and Demographics What GAO FoundIn recent years, women remained underrepresented in management positions in most industries, and female and male managers had different demographic characteristics, according to GAO's analysis of U.S. Census Bureau data. For example, GAO estimated that in 2021, across all industries combined, 42 percent of managers were women, which was less than the percentage of women in non-management positions (48 percent). However, women's representation in management positions increased slightly, by less than 2 percentage points, between 2018 and 2021. In addition, in 2021, female managers were more likely than male managers to be under age 40 and have at least a bachelor's degree. Female managers were also less likely than male managers to be White, married, or have at least one child in their household.GAO found that the gender pay gap varied widely across industries, and was greater for managers than non-managers, in recent years. In 2021, women working full time earned an estimated 76 cents for every dollar that men earned, on average, across all industries combined. Women's pay by industry ranged from an estimated 57 cents on the dollar in the Health Care and Social Assistance industry to 93 cents on the dollar in the Construction industry. Across all industries combined, the pay gap was greater for managers than for non-managers (an estimated 71 cents and 77 cents on the dollar, respectively).GAO also found that the gender pay gap was greater in recent years for women with certain demographic characteristics. Among full-time managers in 2021, the pay gap varied considerably across racial and ethnic groups. For example, for every dollar earned by White men, on average, Native Hawaiian or Other Pacific Islander women earned an estimated 49 cents, and Asian women earned an estimated 86 cents. In addition, the pay gap was greater for female managers who were age 40 and older, had at least a bachelor's degree, were married, and had at least one child in their household. These findings were similar for women who were not managers.Full-Time Female Managers' Estimated Average Pay for Every Dollar Earned by Full-Time, White Male Managers, by Race and Ethnicity, 2021Why GAO Did This StudyResearch has shown that women in the U.S. workforce earn less than men and face challenges in advancing their careers. For example, in 2022, GAO reported that women were underrepresented in management positions. GAO was asked to further assess disparities for women in the U.S. workforce, including women's representation and pay by industry.This report examines (1) women's representation in management positions, by industry, and the key characteristics of women and men in these positions; (2) differences in pay between women and men, by industry, for managers and non-managers; and (3) how pay differences between women and men vary based on key characteristics, for managers and non-managers.GAO analyzed the U.S. Census Bureau's record-level American Community Survey (ACS) data from 2018, 2019, and 2021 (the most recent data available at the time of GAO's review). GAO did not analyze ACS data from 2020 because they were not sufficiently reliable due to data collection challenges early in the COVID-19 pandemic. To analyze pay differences, GAO used average pay for full-time, year-round workers. Because the ACS is a sample survey, all results presented in this report are estimates. All differences in this report are statistically significant at the 95 percent confidence level, unless otherwise noted. GAO's analysis is descriptive, and neither confirms nor refutes the presence of discriminatory practices. GAO did not control for any variables, including those that would be expected to affect pay and representation, such as hours worked beyond full time.For more information, contact Thomas Costa at (202) 512-4769 or costat@gao.gov.
- Subminimum Wage Program: DOL Could Do More to Ensure Timely Oversight What GAO FoundThrough the 14(c) program, the Department of Labor (DOL) certifies employers to pay individuals with disabilities wages below the federal minimum—also known as subminimum wage. Employer participation in this program decreased by about half from 2010 to 2019, according to GAO's analysis of DOL data. During this period, the number of 14(c) workers also fell from about 296,000 to 122,000. Officials GAO interviewed from DOL and four stakeholder organizations attributed this decline, in part, to federal and state policies restricting the payment of wages below the federal minimum. Since August 2019, most 14(c) workers earned less than $3.50 per hour, while about 14 percent earned at or above the federal minimum of $7.25. Representatives from two of the four stakeholder organizations said these earnings patterns may reflect differences in workers' skills and abilities, employment opportunities, and state minimum wage laws.Employers Authorized under Section 14(c) to Pay Subminimum Wages, 2010-2019Community rehabilitation programs provide vocational rehabilitation and other services to individuals with disabilities and represent the vast majority of 14(c) employers. According to GAO's survey of these employers, almost all 14(c) workers had an intellectual or developmental disability, and most were White and of prime working age (25 to 54 years old). In addition, these employers reported few 14(c) workers engaged in competitive employment—which includes earning at least minimum wage in a work setting with individuals without disabilities.DOL oversees the 14(c) program in part through its certification process, such as by ensuring employers calculate wages accurately. However, this oversight has been hampered by long processing times for some applications, including renewals. DOL's processing times varied from 2 days to over 2 years, with about 40 percent completed within 4 months, based on GAO's analysis of data from 2019 through 2021. DOL's application processing manual states that staff are to ensure timely processing, but the agency has not set or communicated timeliness goals. Employers with an existing certificate are allowed to continue paying workers subminimum wages while waiting for their certificates to be renewed. However, if the employer incorrectly calculated wages during this period, the employer may owe workers significant back pay to make up the difference between the correct wage and the wage paid.Why GAO Did This StudySection 14(c) of the Fair Labor Standards Act of 1938 permits employers to pay wages below the federal minimum to individuals with disabilities if they hold a 14(c) certificate from DOL. In 2014, legislation amended the Rehabilitation Act of 1973 to call for maximizing opportunities for these individuals to earn competitive wages in the community. GAO was asked to examine the 14(c) program.This report (1) describes trends in 14(c) program participation and the wages workers earn, (2) describes what 14(c) employers report about their workers' characteristics and movement to competitive employment, and (3) examines the extent to which DOL oversees the 14(c) program. GAO reviewed relevant federal laws, regulations, and guidance, and analyzed DOL data on 14(c) employment, wages, certificates, and investigations. GAO also surveyed a nationally representative sample of community rehabilitation program employers and received an overall response rate of 72 percent, allowing GAO to generalize results to the population. In addition, GAO interviewed officials from DOL and representatives from stakeholder organizations selected for their experience working with the 14(c) program.
- Unemployment Insurance: DOL Needs to Address Substantial Pandemic UI Fraud and Reduce Persistent Risks What GAO FoundGAO found evidence of substantial levels of fraud and potential fraud in unemployment insurance (UI) during the pandemic. GAO estimated over $60&nbsp;billion in fraudulent UI payments by extrapolating the lower bound of the Department of Labor's (DOL) 2021 estimated national fraud rate for the regular UI program. However, such an extrapolation has inherent limitations and should be interpreted with caution. GAO is working to develop a more comprehensive estimate on the total extent of UI fraud during the pandemic. The DOL Office of Inspector General's UI fraud investigations resulted in over 1,200 indictments or initial charges from April 2020 through January 2023. Each week that office continues to open over 100 new UI fraud-related investigative matters.Illustrative examples of unemployment insurance fraud casesDOL and the states were not adequately prepared to handle UI fraud risks when the pandemic began. DOL has taken some recent steps to address UI fraud risks. For example, it has provided state workforce agencies with fraud-related guidance, integrity tools, and grant funding. DOL, however, has not yet implemented an antifraud strategy as called for by leading practices in GAO's Fraud Risk Framework.The expediting of COVID-19 relief funding exacerbated an underlying improper-payment problem in the federal government, including UI, which predated the pandemic. For example, DOL reported an increase in estimated improper payments from $8.0 billion (9.2 percent estimated improper payment rate) for fiscal year 2020 to $78.1 billion (18.9 percent estimated improper payment rate) for fiscal year 2021. For fiscal year 2022, DOL reported estimated improper payments of $18.9 billion (22.2 percent estimated improper payment rate).In June 2022, GAO added the UI system to its High Risk Program based on the system's need for transformation. The system's administrative and program integrity challenges pose significant risks to service delivery and expose the system to significant financial losses. Long-standing challenges with UI administration and outdated IT systems have further affected states' ability to meet the needs of unemployed workers, especially during economic downturns. Such challenges have also contributed to impaired service, declining access, and disparities in benefit distribution.Why GAO Did This StudyThe UI system has faced long-standing challenges with program integrity, which increased dramatically during the pandemic. According to DOL data, expenditures across all UI programs totaled approximately $878 billion from April 2020 through September 2022. This included benefits as part of four new UI programs Congress created to support workers during the pandemic. The unprecedented demand for benefits and the need to quickly implement the new programs increased the risk of financial fraud. Due to these circumstances and other challenges, GAO added the UI system to its High Risk Program in June 2022.This statement addresses: (1) fraud in the UI programs, (2) UI fraud risks and management of such risks, (3)&nbsp;continued UI improper payment problems, and (4) the addition of the UI system to GAO's High Risk Program.This statement is based on GAO's body of work related to the UI system during the pandemic. More detailed information on the objectives, scope, and methodology that form the basis of the statement can be found in individual reports, which are listed in the full hearing statement.
- Unemployment Insurance: Data Indicate Substantial Levels of Fraud during the Pandemic; DOL Should Implement an Antifraud Strategy What GAO FoundConsidered together, measures and estimates indicate substantial levels of fraud and potential fraud in unemployment insurance (UI) programs during the pandemic. However, each measure and estimate has strengths and limitations, and none completely and reliably indicates the extent of fraud in UI programs during the pandemic.Examples and Definitions of Measures and EstimatesDOL has taken steps to address UI fraud risks. For example, DOL issued guidance, provided funding to states, and deployed teams to recommend improvements to state UI programs. While these steps help prevent, detect, and respond to fraud, as of December 2022, DOL has not yet developed an antifraud strategy based on leading practices in GAO's Fraud Risk Framework. Also, it has not yet addressed the six October 2021 recommendations GAO made including to identify, assess the impact of, and prioritize UI fraud risks. These are essential pieces to inform an overall antifraud strategy. Without an antifraud strategy, DOL is not able to ensure that it is addressing the most significant fraud risks facing the UI system in alignment with the Fraud Risk Framework.Why GAO Did This StudyThe UI system has faced long-standing challenges with program integrity, which worsened during the pandemic. Congress created four new UI programs to support workers during the pandemic. According to DOL data, approximately $878 billion in benefits were paid across all UI programs from April 2020 through September 2022. The unprecedented demand for benefits and the need to implement the new programs quickly increased the risk of financial fraud. Due to this risk and other challenges, GAO added the UI system to its High-Risk List in June 2022.GAO was asked to review matters relating to the scope and severity of fraudulent activity in the UI system during the pandemic. This report examines what measures and estimates indicate about the extent of UI fraud during the pandemic and the extent to which DOL designed and implemented a strategy to manage UI fraud risks. GAO reviewed information that federal and state entities used to measure and estimate the extent of fraud in UI programs, then evaluated DOL's activities against leading practices in GAO's Fraud Risk Framework. This report is part of an ongoing body of work to better understand and manage federal fraud, including future work to improve estimates of fraud.
- Women in the Workforce: The Gender Pay Gap Is Greater for Certain Racial and Ethnic Groups and Varies by Education Level What GAO FoundIn recent years, women were underrepresented in management positions and the gender pay gap was greater for certain groups of women, according to the U.S. Census Bureau's (Census Bureau) published American Community Survey (ACS) data on full-time workers. For example, in 2021:Women made up an estimated 44 percent of the overall workforce, but an estimated 41 percent of managers.	Women earned an estimated 82 cents for every dollar that men earned (an overall pay gap of 18 cents on the dollar).	Compared to the overall pay gap, the gender pay gap was greater for full-time female managers, who earned an estimated 77 cents for every dollar earned by full-time male managers (a pay gap of 23 cents on the dollar).	The gender pay gap was also greater for women in certain sectors. For example, among workers who were self-employed in their own incorporated business, women earned an estimated 69 cents for every dollar earned by men (a pay gap of 31 cents on the dollar). In private, for-profit companies, women earned an estimated 78 cents for every dollar earned by men (a pay gap of 22 cents on the dollar). In government agencies and non-profit organizations, women earned an estimated 85 cents for every dollar earned by men (a pay gap of 15 cents on the dollar).	Compared to pay for White men, the pay gap was greater for women in most historically underserved racial and ethnic groups than for White women. For example, for every dollar earned by White men, Hispanic or Latina women earned an estimated 58 cents (a pay gap of 42 cents on the dollar), and Black or African American women earned an estimated 63 cents (a pay gap of 37 cents on the dollar), while White women earned an estimated 79 cents (a pay gap of 21 cents on the dollar).	The gender pay gap also varied by level of education. For example, among workers—including both full-time and part-time workers—with less than a high school diploma, women earned an estimated 66 cents for every dollar earned by men (a pay gap of 34 cents on the dollar). Among workers with a bachelor's degree, women earned an estimated 70 cents for every dollar earned by men (a pay gap of 30 cents on the dollar).This report is descriptive, and it neither confirms nor refutes the presence of discriminatory practices.Why GAO Did This StudyPrior research has shown that women in the U.S. workforce earn less than men and face challenges in advancing their careers. GAO's March 2022 report found that in 2019, women were underrepresented in management positions.GAO was asked to assess disparities for women in the U.S. workforce, including the gender pay gap, in recent years. This is an interim report, and GAO plans to issue a more detailed report in spring 2023. This interim report examines (1) the representation of women, and the difference in pay between women and men, in the overall workforce; and (2) how pay differences between women and men in the overall workforce vary based on race and ethnicity and level of education. To assess women's workforce representation and pay, GAO reviewed published summary-level data from the Census Bureau's ACS from 2018, 2019, and 2021. GAO did not review ACS data from 2020 because the Census Bureau determined that those data did not meet statistical quality standards due to data collection disruptions early in the COVID-19 pandemic .For more information, contact Thomas M. Costa at (202) 512-4769 or costat@gao.gov.