Employment and Training Programs: Providing Information on Colocating Services and Consolidating Administrative Structures
Published: 2011-05-11T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: This testimony discusses the findings from our recent work on federal employment and training programs and our prior work on the Workforce Investment Act of 1998 (WIA). GAO has recently identified 47 federally-funded employment and training programs for fiscal year 2009, defining them as programs that are specifically designed to enhance the job skills of individuals in order to increase their employability, identify job opportunities, and/or help job seekers obtain employment. These programs, which are administered by nine separate federal agencies--including the Departments of Labor, Education, and Health and Human Services (HHS)--spent about $18 billion dollars in fiscal year 2009 to provide services such as job search assistance and job counseling to program participants. Seven programs accounted for about three-fourths of this spending, and two--Wagner- Peyser funded Employment Service (ES) and WIA Adult--together reported serving over 18 million individuals, or about 77 percent of the total number of participants served across all programs. Forty-four of the 47 programs we identified, including those with broader missions such as multipurpose block grants, overlap with at least one other program in that they provide at least one similar service to a similar population. However, differences may exist in eligibility, objectives, and service delivery. Almost all of the 47 programs tracked multiple outcome measures related to employment and training, and the most frequently tracked outcome measure was "entered employment." However, little is known about the effectiveness of employment and training programs because, since 2004, only 5 reported conducting an impact study, and about half of all the remaining programs have not had a performance review of any kind. The multiplicity of employment and training programs combined with the limited information regarding impact raise concerns about the extent to which the federally-funded employment and training system is performing as efficiently and effectively as it should. As early as the 1990s we issued a series of reports that raised questions about the efficiency and effectiveness of the federally-funded employment and training system, and we concluded that a structural overhaul and consolidation of these programs was needed. Partly in response to such concerns, 13 years ago Congress passed WIA. This testimony focuses on two areas where we have identified opportunities to promote greater efficiencies: colocating services and consolidating administrative structures
section_title: What GAO Found
paragraphs: Increasing colocation of services at a single site, as well as consolidating state workforce and welfare administrative agencies, could increase efficiencies, and several states and localities have undertaken such initiatives. However, implementation may pose challenges and little information is available about the strategies and results of these initiatives. To facilitate further progress in increasing administrative efficiencies, we have previously recommended that the Secretaries of Labor and HHS work together to develop and disseminate information about such efforts. Sustained congressional oversight is pivotal in promoting further efficiencies. Specifically, Congress could explore opportunities to foster state and local innovation in integrating services and consolidating administrative structures.

section_title: Letter
paragraphs: Thank you for inviting me here today to discuss the findings from our  recent work on federal employment and training programs and our prior  work on the Workforce Investment Act of 1998 (WIA). As you know, GAO  has recently identified 47 federally-funded employment and training  programs for fiscal year 2009, defining them as programs that are  specifically designed to enhance the job skills of individuals in order to  increase their employability, identify job opportunities, and/or help job  seekers obtain employment. These programs, which are administered by  nine separate federal agencies—including the Departments of Labor,  Education, and Health and Human Services (HHS)—spent about $18  billion dollars in fiscal year 2009 to provide services such as job search  assistance and job counseling to program participants. Seven programs  accounted for about three-fourths of this spending, and two—Wagner- Peyser funded Employment Service (ES) and WIA Adult—together  reported serving over 18 million individuals, or about 77 percent of the  total number of participants served across all programs. Forty-four of the  47 programs we identified, including those with broader missions such as  multipurpose block grants, overlap with at least one other program in that  they provide at least one similar service to a similar population. However,  differences may exist in eligibility, objectives, and service delivery.
Almost all of the 47 programs tracked multiple outcome measures related  to employment and training, and the most frequently tracked outcome  measure was “entered employment.” However, little is known about the  effectiveness of employment and training programs because, since 2004,  only 5 reported conducting an impact study, and about half of all the  remaining programs have not had a performance review of any kind.
The multiplicity of employment and training programs combined with the  limited information regarding impact raise concerns about the extent to  which the federally-funded employment and training system is performing  as efficiently and effectively as it should. As early as the 1990s we issued a  series of reports that raised questions about the efficiency and  effectiveness of the federally-funded employment and training system, and  we concluded that a structural overhaul and consolidation of these  programs was needed. Partly in response to such concerns, 13 years ago  Congress passed WIA.
My testimony today will focus on two areas where we have identified  opportunities to promote greater efficiencies: colocating services and  consolidating administrative structures. In preparing this statement we  relied on our previous work in these areas (please see the related GAO  products section). These products contain detailed overviews of the scope  and methodology we used. The work on which this statement is based was  performed in accordance with generally accepted government auditing  standards. Those standards require that we plan and perform audits to  obtain sufficient, appropriate evidence to provide a reasonable basis for  our findings and conclusions based on our audit objectives. We believe  that the evidence obtained provided a reasonable basis for our findings  and conclusions based on our audit objectives.
In summary, increasing colocation of services at a single site, as well as  consolidating state workforce and welfare administrative agencies, could  increase efficiencies, and several states and localities have undertaken  such initiatives. However, implementation may pose challenges and little  information is available about the strategies and results of these initiatives.  To facilitate further progress in increasing administrative efficiencies, we  have previously recommended that the Secretaries of Labor and HHS  work together to develop and disseminate information about such efforts.  Sustained congressional oversight is pivotal in promoting further  efficiencies. Specifically, Congress could explore opportunities to foster  state and local innovation in integrating services and consolidating  administrative structures.
subsections: section_title: Greater Colocation of Services at One-Stop Centers May Increase Efficiencies
paragraphs: Congress passed WIA partly in response to concerns about fragmentation  and inefficiencies in federal employment and training programs. WIA  authorized several employment and training programs—including Job  Corps and programs for Native Americans, migrant and seasonal  farmworkers, and veterans—as well as the Adult Education and Literacy  program. WIA replaced the Job Training Partnership Act (JTPA)  programs for economically disadvantaged adults and youths and  dislocated workers with three new programs—WIA Adult, WIA Dislocated  Worker, and WIA Youth. These programs provide a range of services,  including occupational training and job search assistance. Beyond  authorizing these programs, WIA also required the establishment of one- stop centers in all local areas and mandated that many federal  employment and training programs, including the ES and WIA Adult  programs, provide services through the centers.
Under WIA, sixteen different categories of programs, administered by four  federal agencies, must provide services through the one-stop system,  according to Labor officials. Thirteen of these categories include  programs that meet our definition of an employment and training program,  and three categories do not, but offer other services to jobseekers who  need them (see fig. 1). These 13 program categories represent about 40  percent of the federal appropriations for employment and training  programs in fiscal year 2010.
One-stop centers serve as the key access point for a range of services that  help unemployed workers re-enter the workforce—including job search  assistance, skill assessment and case management, occupational skills and  on-the-job training, basic education and literacy training, as well as access  to Unemployment Insurance (UI) benefits and other supportive services— and they also assist employers in finding workers. Any person visiting a  one-stop center may look for a job, receive career development services,  and gain access to a range of vocational education programs. In our 2007  study, we found that a typical one-stop center in many states offered  services for eight or nine required programs on-site.
In addition to required programs, one-stop centers have the flexibility to  include other, optional programs in the one-stop system, such as the  Temporary Assistance for Needy Families (TANF) Program, the  Supplemental Nutrition Assistance Program (SNAP) Employment and  Training Program, or other community-based programs, which help them  better meet specific state and local workforce development needs. The  Dayton, Ohio, one-stop center, for example, boasts over 40 programs on- site at the 8-1/2 acre facility, including an organization that provides free  business attire to job seekers who need it, an alternative high school  program that assists students in obtaining a diploma, and organizations  providing parenting and self-sufficiency classes. Nationwide, services may  also be provided at affiliated sites—designated locations that provide  access to at least one employment and training program.
While WIA requires certain programs to provide services through the one- stop system, it does not provide additional funds to operate one-stop  systems and support one-stop infrastructure. As a result, required  programs are expected to share the costs of developing and operating one- stop centers. In 2007, we reported that WIA programs and the ES program  were the largest funding sources states used to support the  infrastructure—or nonpersonnel costs—of their comprehensive one-stop  centers. To help cover operational costs and expand services, some one- stop centers that we visited for a study of promising practices raised  additional funds to support the infrastructure through fee-based services,  grants, or contributions from partner programs and state or local  governments. For example, one-stop operators in Clarksville, Tennessee,  reported that they raised $750,000 in one year through a combination of  business consulting, drug testing, and drivers’ education services. In  addition, the one-stop center in Kansas City, Missouri, had a full-time staff  person dedicated to researching and applying for grants. The one-stop  generated two-thirds of an entire program year’s operating budget of $21  million through competitive grants available from the federal government  as well as from private foundations.
One-stop centers required under WIA provide an opportunity for a broad  array of federal employment and training programs—both required and  optional programs—to coordinate their services and avoid duplication.  Although WIA does not require that programs be colocated within the one- stop center, this is one option that programs may use to provide services  within the one-stop structure. Labor’s policy is to encourage colocation of  all required programs to the extent possible; however, officials  acknowledged that colocation is one of multiple means for achieving  service integration. We have previously reported that colocating services  can result in improved communication among programs, improved  delivery of services for clients, and elimination of duplication. While  colocating services does not guarantee efficiency improvements, it affords  the potential for sharing resources and cross-training staff, and may lead,  in some cases, to the consolidation of administrative systems, such as  information technology systems. Our early study of promising one-stop  practices found that the centers nominated as exemplary did just that— they cross-trained program staff, consolidated case management and  intake procedures across multiple programs, and developed shared data  systems.  More broadly, these promising practices streamline services for  job seekers, engage the employer community, and build a solid one-stop  infrastructure. Other types of linkages between programs, such as  electronic linkages or referrals, may not result in the same types of  efficiency improvements, but they may still present opportunities to  streamline services.
Although the potential benefits of colocation are recognized,  implementation may pose challenges. WIA Adult and the Employment  Service are generally colocated in one-stop centers, but TANF  employment and training services are colocated in one-stops to a lesser  extent. In our 2007 report, we found that 30 states provided the TANF  program on site at a typical comprehensive one-stop center. These states  accounted for 57 percent of the comprehensive one-stop centers  nationwide. Some previous efforts to reauthorize WIA have included  proposals to make TANF a mandatory one-stop partner. Increasing  colocation, however, could prove difficult due to issues such as limited  available office space, differences in client needs and the programs’ client  service philosophies, and the need for programs to help fund the operating  costs of the one-stop centers. HHS officials noted, that when TANF  employment and training services are not colocated in one-stop centers,  they are typically colocated with other services for low-income families,  such as SNAP, formerly known as the Food Stamp Program, and Medicaid.  Officials acknowledged that colocating TANF employment and training  services in one-stop centers may mean that they are no longer colocated  with these other services, although Florida, Texas, and Utah provide SNAP  services through one-stops along with TANF services, and Utah also  provides Medicaid through one-stops. Officials said that in states where  this is not the case, the potential trade-off would need to be considered.
section_title: Consolidating Administrative Structures May Also Increase Efficiencies
paragraphs: Given that the purpose of WIA, in part, was to transform the fragmented  employment and training system into a coherent one, our work suggests  that greater efficiencies could be achieved. Three of the largest  employment and training programs, the TANF, ES, and WIA Adult  programs, provide some of the same employment and training services to  low-income individuals, despite differences between the programs (see fig.  2). While the TANF program serves low-income families with children, the  ES and WIA Adult programs serve all adults, including low-income  individuals. Specifically, the WIA Adult program gives priority for intensive  and training services to recipients of public assistance and other low- income individuals when program funds are limited. All three programs  share a common goal of helping individuals secure employment, and the  TANF and WIA Adult programs also aim to reduce welfare dependency.  However, employment is only one aspect of the TANF program, which has  other broad social service goals, and as a result, TANF provides a wide  range of other services beyond employment and training, including cash  assistance.
Jo search workshops.
Susidized employment.
The TANF, ES, and WIA Adult programs maintain separate administrative  structures to provide some of the same services to low-income individuals.  At the federal level, the TANF program is administered by HHS, and the ES  and WIA Adult programs are administered by Labor. At the state level, the  TANF program is typically administered by the state human services or  welfare agency, and the ES and WIA Adult programs are typically  administered by the state workforce agency. By regulation, ES services  must be provided by state employees. At the local level, WIA regulations  require at least one comprehensive one-stop center to be located in every  local workforce investment area. These areas may have the same  boundaries as counties, may be multicounty, or may be within or across  county lines. Similarly, every county typically has a TANF office. TANF  employment and training services may be delivered at TANF offices, in  one-stop centers, or through contracts with for-profit or nonprofit  organizations, according to HHS officials. In one-stop centers, ES staff  provide job search and other services to ES customers, while WIA staff  provide job search and other services to WIA Adult customers.
Florida, Texas, and Utah have consolidated the state workforce and  welfare agencies that administer the TANF, ES, and WIA Adult programs,  among other programs. In Utah, the workforce agency administers the  TANF program in its entirety. In Florida and Texas, the workforce  agencies administer only that part of TANF related to employment and  training services. In all three states, the one-stop centers serve as portals  to a range of social services, including TANF. Officials from these three  states told us that consolidating agencies led to cost savings through the  reduction of staff and facilities. For example, a Utah official said that the  state reduced the number of buildings in which employment and training  services were provided from 104 to 34. According to a Texas official,  Texas also privatized 3,000 full-time staff equivalents (FTE) at the local  level, which reduced the pension, retirement, and insurance costs that had  previously been associated with these state positions. Officials in the three  states, however, could not provide a dollar figure for the cost savings that  resulted from consolidation.
State officials also told us that consolidation improved the quality of  services for participants in the WIA Adult and TANF programs. An official  in Utah noted the consolidation allowed job seekers to apply for  assistance they had not considered in the past, allowed employment  counselors to cluster services that made sense for the client, and allowed  clients to experience seamless service delivery. These benefits reflected  what the official said was one of the visions of consolidation: having one  employment plan per client, rather than multiple employment plans for  clients served by multiple programs. While Florida officials acknowledged  that a subset of TANF clients have significant barriers to employment— such as mental health issues—that one-stop centers may not be well  equipped to address, officials said that the one-stops in their state are able  to address the employment and training needs of the majority of TANF  clients. When asked about the quality of the TANF and workforce  programs in Florida, Texas, and Utah, Labor officials were not aware of  any performance problems in these programs and added that they view all  three states as forerunners in program improvement efforts. That said,  they noted that Utah may not be representative of other states, due to its  relatively small and homogenous population. In addition, officials from the  Center for Law and Social Policy (CLASP) said that Texas and Florida may  place more of an emphasis on quickly finding work for TANF clients than  other states.
Even with the benefits identified by state officials, consolidation may have  its challenges. An official in Utah noted that the reorganization of state  agencies and staff was time-consuming and costly, and it took several  years before any cost savings were realized. For example, developing a  shared database across programs increased costs temporarily. In addition,  when states consolidate their agencies, they must still adhere to separate  program requirements for TANF and WIA. A 2004 article on service  integration by authors from CLASP and the Hudson Institute concluded  that options were available for states to make significant progress in  integrating TANF and WIA services, but it also noted the difficulty in  administering separate programs with different requirements. The article  specifically noted differences in work requirements, program performance  measures, and reporting requirements, among others. A Utah official said  that it was important for program administrators to be knowledgeable  about these separate reporting requirements and processes across the  multiple federal agencies that oversee these programs. Similarly, this  official said that direct service staff needed to be knowledgeable about  multiple programs and how to allocate costs across these programs. For  states that have not consolidated their workforce and welfare agencies,  not knowing what actions are allowable under the law may present a  challenge to consolidation. According to the article on service integration,  states face some legal barriers to fully integrating TANF and WIA services,  but if they do not know what is allowable under the law, they may not  always exercise the full range of options available to them.
In conclusion, understanding how well the one-stop system is reducing  fragmentation through coordinated service delivery would be useful in  deciding where efficiencies could be achieved, but no study has been  undertaken to evaluate the effectiveness of the one-stop system approach.  While a few program impact studies have been done or are underway,  these studies largely take a program-by-program approach rather than  focusing on understanding which approaches are most effective in  streamlining service delivery and improving one-stop efficiency. In  addition, Labor’s efforts to collaborate with other agencies to assess the  effects of different strategies to integrate job-seeker services have been  limited. We previously recommended that Labor collaborate with  Education, HHS, and the Department of Housing and Urban Development  (HUD) to develop a research agenda that examines the impacts of various  approaches to program integration on job seeker and employer  satisfaction and outcomes. Labor has committed to collaborating with  other agencies and has involved them in developing inter-agency initiatives  for certain targeted activities, but has not yet evaluated the effectiveness  of the one-stop system.
While states and localities have undertaken some potentially promising  initiatives to achieve greater administrative efficiencies, little information  is available about the strategies and results of these initiatives; therefore, it  is unclear the extent to which practices in these states could serve as  models for others. Moreover, little is known about the incentives states  and localities have to undertake such initiatives and whether additional  incentives may be needed. We recently recommended that the Secretaries  of Labor and HHS work together to develop and disseminate information  that could inform such efforts, including information on state initiatives to  consolidate program administrative structures and state and local efforts  to colocate additional programs at one-stop centers. As part of this effort,  we recommended that Labor and HHS examine the incentives for states  and localities to undertake such initiatives and, as warranted, identify  options for increasing them. In their responses, Labor and HHS agreed  with our recommendations. However, HHS noted that it lacks legal  authority to mandate increased TANF-WIA coordination or to create  incentives for such efforts.
Increasing efficiencies among federal employment and training programs  is clearly challenging. These are difficult issues to address because they  may require agencies and Congress to re-examine within and across  various mission areas the fundamental structure, operation, funding, and  performance of a number of long-standing federal programs and activities.  As the nation rises to meet its current fiscal challenges, GAO will continue  to assist Congress and federal agencies in identifying actions needed to  address these issues.
Chairwoman Foxx, Ranking Member Hinojosa, and Members of the  Subcommittee, this completes my prepared statement. I would be happy to  respond to any questions you may have at this time.
section_title: GAO Contact and Staff Acknowledgments
paragraphs: For further information regarding this testimony, please contact me at  (202) 512-7215 or sherrilla@gao.gov. Individuals making key contributions  to this testimony include Dianne Blank, Pamela Davidson, Patrick  Dibattista, Alex Galuten, Jennifer Gregory, Isabella Johnson, and Sheila  McCoy.
section_title: Appendix I: Federally Funded Employment and Training Programs by Agency, Fiscal Year 2009
paragraphs: Employment and Training Programs: Opportunities Exist for  Improving Efficiency. GAO-11-506T. Washington, D.C.: April 7, 2011.
Opportunities to Reduce Fragmentation, Overlap, and Potential  Duplication in Federal Teacher Quality and Employment and Training  Programs. GAO-11-509T. Washington, D.C.: April 6, 2011.
Opportunities to Reduce Potential Duplication in Government  Programs, Save Tax Dollars, and Enhance Revenue. GAO-11-441T.  Washington, D.C.: March 3, 2011.
Opportunities to Reduce Potential Duplication in Government  Programs, Save Tax Dollars, and Enhance Revenue. GAO-11-318SP.  Washington, D.C.: March 1, 2011.
Multiple Employment and Training Programs: Providing Information  on Colocating Services and Consolidating Administrative Structures  Could Promote Efficiencies. GAO-11-92. Washington, D.C.: January 13,  2011.
Workforce Investment Act: Labor Has Made Progress in Addressing  Areas of Concern, but More Focus Needed on Understanding What Works  and What Doesn’t. GAO-09-396T. Washington, D.C.: February 26, 2009.
Workforce Development: Community Colleges and One-Stop Centers  Collaborate to Meet 21st Century Workforce Needs. GAO-08-547.  Washington, D.C.: May 15, 2008.
Workforce Investment Act: One-Stop System Infrastructure Continues to  Evolve, but Labor Should Take Action to Require That All Employment  Service Offices Are Part of the System. GAO-07-1096. Washington, D.C.:  September 4, 2007.
Workforce Investment Act: Additional Actions Would Further Improve  the Workforce System. GAO-07-1051T. Washington, D.C.: June 28, 2007.
Workforce Investment Act: Substantial Funds Are Used for Training, but  Little Is Known Nationally about Training Outcomes. GAO-05-650.  Washington, D.C.: June 29, 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.
Workforce Investment Act: Labor Actions Can Help States Improve  Quality of Performance Outcome Data and Delivery of Youth Services.  GAO-04-308. Washington, D.C.: February 23, 2004.
Workforce Investment Act: One-Stop Centers Implemented Strategies to  Strengthen Services and Partnerships, but More Research and  Information Sharing Is Needed. GAO-03-725. Washington, D.C.: June 18,  2003.
Multiple Employment and Training Programs: Funding and  Performance Measures for Major Programs. GAO-03-589. Washington,  D.C.: April 18, 2003.
Workforce Investment Act: States’ Spending Is on Track, but Better  Guidance Would Improve Financial Reporting. GAO-03-239. Washington,  D.C.: November 22, 2002.
Workforce Investment Act: Better Guidance and Revised Funding  Formula Would Enhance Dislocated Worker Program. GAO-02-274.  Washington, D.C.: February 11, 2002.
Multiple Employment and Training Programs: Overlapping Programs  Indicate Need for Closer Examination of Structure. GAO-01-71.  Washington, D.C.: October 13, 2000.
Workforce Investment Act: Implementation Status and the Integration of  TANF Services. GAO/T-HEHS-00-145. Washington, D.C.: June 29, 2000.
Multiple Employment Training Programs: Information Crosswalk on  163 Employment Training Programs. GAO/HEHS-95-85FS. Washington,  D.C.: February 14, 1995.
Multiple Employment Training Programs: Major Overhaul Needed to  Reduce Costs, Streamline the Bureaucracy, and Improve Results.  GAO/T-HEHS-95-53. Washington, D.C.: January 10, 1995.
Multiple Employment Training Programs: Overlap Among Programs  Raises Questions About Efficiency. GAO/HEHS-94-193. Washington, D.C.:  July 11, 1994.
Multiple Employment Training Programs: Conflicting Requirements  Underscore Need for Change. GAO/T-HEHS-94-120. Washington, D.C.:  March 10, 1994.
Multiple Employment and Training Programs: Major Overhaul is  Needed. GAO/T-HEHS-94-109. Washington, D.C.: March 3, 1994.
Multiple Employment Training Programs: Overlapping Programs Can  Add Unnecessary Administrative Costs. GAO/HEHS-94-80. Washington,  D.C.: January 28, 1994.
Multiple Employment Training Programs: Conflicting Requirements  Hamper Delivery of Services.
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