Veterans' Employment and Training Service: Greater Accountability and Other Labor Actions Needed to Better Serve Veterans
Published: 2006-02-02T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The number of service members leaving active duty is likely to increase by 200,000 yearly, according to the Department of Labor. To improve employment and training services for veterans and to encourage employers to hire them, Congress passed the Jobs for Veterans Act in 2002, which reformed Labor's Disabled Veterans' Outreach Program (DVOP) and Local Veterans' Employment Representative (LVER) program. This testimony summarizes GAO's recent review of progress implementing the act, including the development of new staff roles and responsibilities, incentive awards, and performance accountability system. GAO examined (1) actions taken to improve performance and accountability since the law's enactment and any associated challenges, (2) whether available data indicate that such action has resulted in improved employment outcomes for veterans, and (3) factors affecting program oversight an accountability.
section_title: What GAO Found
paragraphs: Labor implemented most reforms under the Jobs for Veterans' Act (JVA) to improve the DVOP and LVER programs within the first 2 years of its enactment. However, it has not yet fully implemented measures to improve state accountability for these programs. Specifically, Labor reports that states will not be held accountable to the same standard for veterans' employment until 2007. States also report substantial progress implementing the law, but integrating veterans' staff with other one-stop staff remains challenging in some local areas. In addition, about one-third of the states did not establish incentive programs for their workforce personnel because state laws, policies, or agreements conflict with this JVA provision. Most state workforce administrators surveyed reported that the new legislation has improved both the quality of services to veterans and their employment outcomes. For example, they reported that services provided to disabled veterans have improved. They also credited the greater availability of case management and outreach to new employers for much of the improvement in employment outcomes under JVA. Aside from the law's influence, state administrators cited the willingness of employers to hire veterans and the strength of the local job market as significant factors affecting veterans' employment. About half of state directors of Veterans' Employment and Training reported their new monitoring role had strengthened local program accountability. However, just over a third reported that accountability had either lessened or not improved. Some partly attributed this to absence of local performance data and fewer annual visits to one-stop centers. GAO found, as well, that a lack of coordination among Labor's agencies responsible for certain JVA provisions has weakened accountability. Also, while Labor has developed a system to monitor program performance, it lacks a strategy for using the information it gathers to make improvements and to help states.

section_title: Letter
paragraphs: I am pleased to be here today to present the findings of our recent report  on how the Department of Labor (Labor) and states have implemented  some key provisions of the Jobs for Veterans Act (JVA). Congress passed  JVA in 2002 not only to improve employment and training services for  unemployed veterans, but also to encourage employers to hire them. The  ability of veterans to quickly obtain quality service and employment has  always been important, but will become even more so as the number of  service members leaving active duty is likely to increase by 200,000 yearly,  according to Labor.
The act introduced several reforms to two of Labor’s primary veterans’  employment assistance programs—the Disabled Veterans’ Outreach  Program (DVOP) and the Local Veterans’ Employment Representative  (LVER) program—administered by the Veterans’ Employment and  Training Service (VETS). Under the act, DVOP staff are to focus on finding  and serving veterans who need services to become job ready, including  case management services for developing job skills. LVER staff are to  focus on developing relationships with employers to encourage them to  hire veterans. In addition, the act called for DVOP and LVER staff to be  integrated with other staff providing employment and training services  within the one-stop delivery system established in 1998 under the  Workforce Investment Act (WIA), and established an incentive program to  reward staff for outstanding service to veterans. To determine how well  these programs were working to assist veterans across states, the act also  required Labor to establish a performance accountability system as well as  a national minimum standard—or threshold—that states must meet for  veterans’ employment.
GAO previously testified on our preliminary observations on the status of  implementation of these key provisions of JVA. My testimony today will  present the findings of our completed work related to the JVA reforms of  the DVOP and LVER programs. Specifically, I will address (1) action taken  to improve performance and accountability since the enactment of JVA in  2002 and any associated challenges; (2) whether available data reflect that  such action has resulted in improved employment outcomes for veterans;  and (3) factors affecting program oversight and accountability.
In summary, our work shows that Labor and most states took action to  implement JVA reforms for improving the DVOP and LVER programs  within the first two years of the new legislation. However, our work also  highlights several areas where Labor agencies should collaborate and take  additional action to enhance outcomes of these reforms, particularly in the  area of improving state oversight and accountability. To this end, our  December 2005 report recommended that Labor agencies work together to  provide states and local areas with strategies to address the long-standing  challenge they have faced in integrating veterans’ staff into their service  delivery system. For those states with an incentive award system, the wide  variation in methodology for awarding incentives as well as the mixed  opinions on the program’s success suggests that states could benefit from  Labor presentation of methodologies that it considers successful and we  recommended that Labor share these best practices. Finally, while states  have appreciated the flexibility JVA provides them in serving veterans,  such flexibility underscores the need for greater accountability to ensure  that programs are on the right track in serving clients. However,  accountability can be hindered and reforms implemented inconsistently  when local level information is not always available, different Labor  agencies do not coordinate their oversight efforts, and Labor does not use  monitoring results to improve program performance. We therefore  recommended that Labor strategically use monitoring results to target  guidance and technical assistance to states and local areas most in need of  improved performance. Labor generally agreed with our  recommendations.
Our review was based on a survey of VETS directors as well as a survey of  state workforce administrators in all 50 states and the District of  Columbia. We also visited five states—California, Florida, Louisiana, Ohio,  and Washington—where we interviewed VETS and state workforce  officials, including local office managers and DVOP and LVER staff. In  addition, we visited the National Veterans’ Training Institute in Denver,  Colorado, where we interviewed training officials and veterans’ staff from  24 states who were attending training classes. Finally, we held discussions  with Labor agency officials and contacted various veterans’ service  organizations and the National Association of State Workforce Agencies.
subsections: section_title: Background
paragraphs: JVA amended Title 38 of the U.S. Code, the legislation that governs the  DVOP and LVER programs, and by doing so, introduced an array of  reforms to the way employment, training, and placement services are  provided to veterans under the DVOP and LVER programs. (See table 1.)  The act also required increased veterans’ access to electronic services as  well as to different types of Labor employment and training programs by  requiring them to give veterans priority in receiving their services. In  addition, it required federal contractors to advertise job openings at the  appropriate employment service delivery system and report on their  veteran hiring practices.
Within Labor, VETS has primary responsibility for helping the nation’s  veterans find employment. Among the programs that VETS administers are  the DVOP and LVER programs, which were funded at about $162 million in  fiscal year 2005. VETS administers the agency’s activities through  representatives in each of Labor’s six regional offices and within each  state. The state directors are the link between VETS and each state’s  employment service system that is overseen by the ETA. The DVOP and  LVER staff, whose positions are funded by VETS, are part of the state’s  public employment service system.
Employment services fall under the purview of ETA, which administers  the Wagner-Peyser-funded Employment Services program within each  state, providing a national system of public employment services to any  individual seeking employment who is authorized to work in the United  States. Like VETS, ETA carries out its employment service program  through staff in Labor’s six regions and workforce agencies in each state.  In fiscal year 2005, ETA requested about $700 million for the Wagner- Peyser program.
The DVOP and LVER programs, along with the Employment Services  program, are all mandatory partners in the one-stop center system created  in 1998 by WIA and overseen by Labor, in which services provided by  numerous employment and training programs are made available through  a single network.
section_title: Labor and States Acted to Implement Program Reforms, but Accountability Challenges Remain
paragraphs: Labor and states have taken action to implement most JVA provisions to  reform veterans’ services since the law was enacted in November 2002, but  challenges remain particularly in implementing reforms to improve  accountability for the DVOP and LVER programs. Labor issued guidance  clarifying the new roles and responsibilities for veterans’ staff and  allocated funding to states for an incentive program. Labor has also  established performance measures aligned with state workforce systems  under WIA as required by JVA. However, Labor reports that states will not  be held accountable to a common national standard for veterans’  employment until 2007. (See table 2.) States also report good progress in  implementing provisions, but challenges remain in some local areas in  terms of integrating veterans’ staff with other employment services staff in  local workforce centers. Many states also have not implemented an  incentive program as provided in JVA for recognizing quality services to  veterans.
subsections: section_title: Staff Roles and Responsibilities
paragraphs: VETS took several steps to prepare veterans’ staff for their new roles and  responsibilities under the law, and while the majority of state workforce  administrators reported that these staff had transitioned to a greater focus  on intensive services for veterans and employer outreach as required by  JVA, challenges remained in the areas of training and integrating staff in  some one-stop offices. VETS began issuing guidance to transition staff to  their new roles in 2002, and a training program soon followed in 2003.  Both Labor’s formal written guidance and technical assistance was well- received, with almost three-quarters of the 50 state workforce officials  reporting on our survey that the quality was good or excellent in  facilitating implementation of new staff duties.
VETS officials cited challenges, however, in meeting all training needs for  veterans’ staff informing them of their new roles and responsibilities under  the act. While Labor’s training institute continues to conduct and fund  training, it estimated that the current funding would cover training for only  about 16 percent of all veterans’ staff each year, while annual staff  turnover was averaging about 18 percent. In terms of staff integration,  Labor officials said that integrating staff into the one-stop offices has been  a persistent challenge and the DVOP and LVER staff we interviewed cited  a wide variation of integration in local areas. Reasons these staff cited for  poor integration included a lack of support by the local office manager, the  lack of education and training for other one-stop staff members on serving  veterans, and only fair to poor quality of Labor’s guidance and technical  assistance to states in how to integrate veterans’ staff into the local one- stop offices.
section_title: Incentive Awards Program
paragraphs: VETS issued guidance in time to establish an incentive program in the first  fiscal year after JVA, and 32 of the 50 state workforce administrators we  surveyed reported implementing the program. State workforce officials in  17 states that did not implement the program cited various reasons.  California, for example, cited that state law prohibited monetary or other  gifts to employees for performing their duties. Idaho cited potential morale  problems among one-stop staff that have limited opportunities to serve  veterans. Four other states cited that the awards were incompatible with  the states’ collective bargaining agreements. VETS officials said that some  states had been more successful than others in designing their awards  system and state opinions were mixed on the extent that the incentive  programs resulted in improved services. Administrators in 16 states with  award programs in place reported that their program had a positive effect  on improving or modernizing veterans’ services. On the other hand,  administrators in 15 other states either said that their incentive program  had no effect (7 states) or that it was too early to say (8 states).
section_title: Performance Accountability
paragraphs: Labor has taken action to establish a new accountability system as  required by JVA, but reports that more time is needed under the new  system before it can hold all states accountable to the same standard for  veterans’ employment. As required by the act, Labor established some new  performance measures for the DVOP and LVER grant programs in 2003  consistent with state performance measures under WIA. VETS officials  told us they made additional modifications to the performance  accountability system when they adopted the Office of Management and  Budget’s new common performance measures in July 2005. As these new  systems were put in place, VETS officials said they also changed the  method they use to calculate the entered employment measure and collect  source data. However, VETS anticipates it will need at least 3 years under  these measures—until 2007—to collect comparable trend data needed to  establish the national performance standard holding all states accountable  to the same minimum goal for the rate veterans enter employment.
section_title: State Officials Reported that JVA Reforms Improved Veterans’ Services and Employment Outcomes
paragraphs: While data are not available to link the JVA reforms to changes in veterans’  services and employment outcomes, most state workforce administrators  we surveyed believed that the reforms have improved the quality of  services to veterans, and have improved their employment outcomes.  Overall, 33 of the 50 state workforce administrators reported that veterans’  employment services have improved in their respective states since the  law’s enactment. Among six different services we asked about,  administrators most often reported that DVOP staff were spending more  time on case management since JVA, although somewhat fewer states  reported that services to disabled veterans had similarly improved. (See  fig. 1.)
Workforce administrators in 33 states also reported improvement in  veterans’ employment results. These respondents attributed the  improvement both to the law’s reforms and to other factors. The reform  cited most often as helping veterans obtain employment was the increased  availability of case management or other intensive services through the  DVOP program. Other than the reforms themselves, administrators said  veterans’ employment was influenced by employer willingness or desire to  hire veterans and by the strength of the local job market. (See fig. 2.)
In terms of barriers to employment, state administrators reported that  federal contractor failure to list job openings at the local one-stop centers  was a factor under most likely to delay or prevent some employment.  Other factors also presented obstacles to employment, the most frequent  one being a poor local job market. This factor was cited nearly twice more  often as other factors, such as non-transferability of skills or employer  reluctance to hire veterans with National Guard or Reserve commitments.  (See fig. 3.)
section_title: Program Accountability Weakened by Absence of Local Data and Lack of Coordinated Oversight
paragraphs: Labor oversight and accountability for the DVOP and LVER programs has  been affected by the lack of data available from local workforce offices in  some states, as well as the lack of coordination among Labor agencies in  monitoring and sharing information gathered on program performance.  While state VETS directors responding to our survey most often reported  that their monitoring role under JVA has had a positive effect on local  accountability, 19 directors reported their monitoring role either had no  effect or a negative effect. Our survey showed two main reasons for the  lack of a stronger effect.
Lack of Local Level Data. In our survey, state VETS directors reported  that performance data from local offices are not available in many states,  limiting federal oversight and weakening local level accountability. State  VETS directors reported in our survey that among four different tools used  to monitor local office performance, the most beneficial were analysis and  use of data captured in states’ performance reports, along with on-site  reviews of local offices. Under JVA, states took on greater responsibility  for assessing their own performance, and VETS modified its monitoring  practices in response by extending the time between site visits to local  offices from 1 year to 5 years. VETS directors in 21 states, however, noted  that data were not available to monitor performance of local offices, and  in these states, federal oversight may be limited to the on-site monitoring  visits by VETS directors required once every 5 years.
Lack of Coordinated Oversight. While Labor agencies are jointly  responsible for monitoring employment and training services, little or no  effort has been made to coordinate oversight or use the monitoring results  to target assistance to states and localities that are most in need. For  example, while VETS is responsible for monitoring performance of the  DVOP and LVER programs, ETA oversees other workforce programs that  serve veterans as well as nonveterans, such as WIA and Wagner-Peyser  Employment Services. However, the two agencies do not generally  coordinate their monitoring activities or share the results. Only five state  VETS directors reported that they met with ETA officials to share  monitoring results and take joint action to address problems.
Labor also lacks a strategy for using the monitoring information it gathers  to improve performance across states and local areas. While Labor has  authority under JVA to provide technical assistance to states that are  deficient in performance or need help, VETS has yet to begin addressing  the significant variation in performance levels among states, as reflected  by their widely divergent performance goals. For example, in program  years 2004 and 2005, states’ negotiated goals for the rate at which veterans  entered employment ranged from 38 to 65 percent, while Labor’s national  employment goal for veterans was 58 percent. Although more than half of  the state goals fell short of Labor’s national target, VETS has not been  proactive in determining why certain states are falling behind and in  targeting them for assistance.
section_title: Recommendations
paragraphs: Our report recommended that the Secretary of Labor provide clear  guidance to integrate veterans’ staff into the one-stops and foster state use  of incentives. We also recommended that Labor’s program offices  coordinate their oversight of JVA provisions, and that Labor use  monitoring results to develop program improvements. Labor agreed with  our recommendations.
Mr. Chairman, this completes my prepared statement. I would be happy to  respond to any questions you or other Members of the Committee may  have at this time.
section_title: Contact and Acknowledgments
paragraphs: For further information regarding this testimony, please contact me at  (202) 512-7215. Lacinda Ayers, Meeta Engle, and Stan Stenersen were key  contributors to this testimony.
section_title: Related GAO Products
paragraphs: Veterans’ Employment and Training Service: Labor Actions Needed to  Improve Accountability and Help States Implement Reforms to Veterans’  Employment Services. GAO-06-176. Washington, D.C.: December 30, 2005.
Unemployment Insurance: Better Data Needed to Assess Reemployment  Services to Claimants. GAO-05-413. Washington, D.C.: June 24, 2005.
Veterans’ Employment and Training Service: Preliminary Observations  on Changes to Veterans’ Employment Programs. GAO-05-662T.  Washington, D.C.: May 12, 2005.
Workforce Investment Act: States and Local Areas Have Developed  Strategies to Assess Performance, but Labor Could Do More to Help.   GAO-04-657. Washington, D.C.: June 1, 2004.
Veterans’ Employment and Training Service: Flexibility and  Accountability Needed to Improve Service to Veterans. GAO-01-928.  Washington, D.C.: September 12, 2001.
Veterans’ Employment and Training Service: Proposed Performance  Measurement System Improved, but Further Changes Needed.   GAO-01-580. Washington, D.C.: May 15, 2001.
Veterans’ Employment and Training Service: Strategic and Performance  Plans Lack Vision and Clarity. GAO/T-HEHS-99-177. Washington, D.C.:   July 29, 1999.
Veterans’ Employment and Training Service: Assessment of the Fiscal  Year 1999 Performance Plan. GAO/HEHS-98-240R. Washington, D.C.:   September 30, 1998.
Veterans’ Employment and Training: Services Provided by Labor  Department Programs. GAO/HEHS-98-7. Washington, D.C.:                October 17, 1997.
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