Labor and VA oversee six employment and training programs targeted to veterans (see table 1). Labor administers its programs through state workforce agencies in each state. Within Labor, VETS administers five employment programs targeted to veterans. VETS provides grants to states to support state workforce agency staff who serve veterans through the Disabled Veterans’ Outreach Program, Employment Representative Program, and TAP. Through the Homeless Veterans’ Reintegration Program and VWIP, VETS also provides funding to organizations that serve eligible veterans, including nonprofits. Labor oversees these programs through federal officials stationed in each region, as well as a Director of Veterans’ Employment and Training located in each state. Within VA, the Vocational Rehabilitation Program provides employment services to certain veterans with disabilities. VA offers the program in 56 regional offices and 169 satellite offices. The program has about 1,000 staff, including vocational rehabilitation counselors, employment coordinators, support staff, and managers. Rehabilitation counselors determine entitlement to services. In addition to its programs administered by VETS, Labor offers employment and training services to the general population—including veterans. These services are administered by the Employment and Training Administration (ETA). First, ETA administers the ES Program, which provides a national system of public employment services to all individuals seeking employment. ES provides services such as job search, labor market information, and job referrals to the public, including job seekers and employers. ETA carries out its ES Program through state workforce agencies. ETA also administers the WIA Adult and Dislocated Worker programs, which provide a broad range of services including job search assistance, skill assessment, and training for eligible individuals. When funds are limited, the WIA Adult Program is to give priority for intensive and training services to low income adults or those on public assistance. In program year 2010, 94,629 veterans exited from the WIA Adult Program. WIA’s Dislocated Worker Program generally targets adults who have been terminated or laid off from employment and meet other criteria. In program year 2010, 58,350 veterans exited from the WIA Dislocated Worker Program. Federal law requires VETS, ES, and WIA Adult and Dislocated Worker programs to offer their services through the one-stop system—which includes centers through which job seekers can access a range of employment and training programs. Two of VETS’ programs—Disabled Veterans’ Outreach and Employment Representative programs—have about 2,100 staff who work primarily in local one-stop centers. Federal law also requires other Labor-funded programs—including ES and WIA Adult and Dislocated Worker programs—to give veterans priority over the general population when they seek services (referred to as priority of service). VETS and ETA jointly monitor compliance with this requirement. Most ETA and VETS programs report the same performance measures, known as the common measures. They include percentage of program exiters who have obtained employment (entered employment rate), percentage retaining employment for 6 months after exiting the program (employment retention rate), and 6-month average earnings of program exiters (average earnings). For each of these, Labor establishes annual performance goals. VA reports an employment rehabilitation rate as a measure of performance for the Vocational Rehabilitation Program. A “rehabilitated” veteran is one who successfully completes a rehabilitation plan and is equipped with the required skills and tools needed to obtain and maintain suitable employment (i.e., employment that is consistent with the veteran’s skills, aptitudes, and interests). DOD works with Labor and VA to provide transition assistance workshops as a part of TAP. In addition, DOD helps Guard and Reserve members obtain civilian employment though its operation of several programs, including the Yellow Ribbon Program and ESGR. The Yellow Ribbon Program serves National Guard and Reserve members and their families by hosting events that provide information on employment opportunities, health care, education/training opportunities, finances, and legal benefits. The ESGR is a nationwide network of volunteers who address unemployment and underemployment of Guard and Reserve members through participation in employment-related events. As shown in figure 1, the six federal employment and training programs targeted to veterans offer similar types of employment and training services. assessment, job search or job placement activities, and job readiness skills training. Other services available from more than one of these programs include the development of job opportunities, job referrals, and occupational and vocational training, among others. Labor and VA have established a framework to coordinate their employment and training programs. In 2005, Labor and VA signed an interagency memorandum of agreement that outlines how the agencies plan to coordinate the Vocational Rehabilitation and Disabled Veterans’ Outreach and Employment Representative programs to serve disabled veterans, respectively. The agencies have also collaboratively created an interagency handbook that delineates roles and responsibilities and establishes a referral process between the Disabled Veterans’ Outreach and the Vocational Rehabilitation programs. To assist field staff, the interagency handbook also provides standard language and guidance for agreements between local Labor and VA offices. As a result, local offices from both agencies can tailor the standard agreement language to meet local situations. The handbook has not been updated since 2008. Labor and VA have provided staff with training on the handbook and formed a group to monitor coordination. Labor and VA conducted a national training webinar based on the interagency handbook for both agencies’ staff after it was published, have made virtual trainings available since 2009, and provided technical assistance to staff. To monitor the coordination activities outlined in the interagency handbook, Labor and VA created a Joint Work Group. According to Labor and VA officials, this group recently discussed and agreed on a plan to review one-third of local agreements made between Labor and VA field locations annually. Labor and VA have collected information that could be useful in updating the handbook. The Joint Work Group recently conducted its first in-depth review of states’ implementation of the handbook since it was established in 2008. According to Labor and VA officials, the Joint Work Group electronically surveyed the VA employment coordinators in all 56 VA Regional Offices and the 52 state-level directors of the Disabled While Veterans’ Outreach and Employment Representative programs. VA officials stated that they are currently reviewing the survey results to determine if the handbook needs to be updated, Labor officials told us told us they believe the handbook needs to be updated. We have reported previously that agencies need to create means to monitor agreements and related guidance periodically to keep them current and to identify areas for improvement. Our interviews with Labor and VA officials identified certain challenges with meeting desired program outcomes resulting, in part, from sections of the handbook that are subject to misunderstanding or provide insufficient guidance. They pertain to incorporating labor market information into rehabilitation plans and finding “suitable employment” for participants. The first challenge with referrals as outlined in the handbook involved ensuring that participants’ rehabilitation plans prepared them for jobs that existed in their local area. According to the referral process outlined in the interagency handbook and by agency officials (see fig. 3), there are two main referral points from the Vocational Rehabilitation Program to Labor’s Disabled Veterans’ Outreach Program staff: (1) before the participant’s rehabilitation plan is completed and (2) after the participant has completed a rehabilitation plan and been deemed job-ready, or ready for employment, by VA staff. Disabled Veterans’ Outreach Program staff may provide participants with labor market information or other employment assistance at the first referral point and are required to at the second referral point. While VA officials in four of the six states we reviewed reported that they connected participants with Labor staff to receive labor market information and other employment consulting, only three of these states reported that they did this early in the process before the rehabilitation plan is completed. In two other states, VA officials reported they understood that they were supposed to refer participants to Labor only after they had completed rehabilitation plans and were job-ready, essentially skipping the first step where labor market information may have been useful. VA officials reported that labor market information may be provided to participants through small group presentations with Disabled Veterans’ Outreach staff. For their part, state-level Labor officials noted that job placement was more challenging for Disabled Veterans’ Outreach Program staff when participants’ rehabilitation plans were developed without labor market information. In such cases, according to Labor officials, Disabled Veterans’ Outreach Program staff were sometimes working with plans focused on training in occupations not available in the local labor market—in effect using programs’ funds to prepare participants for jobs that do not exist in their local area. According to Labor officials, this made it more difficult for participants to have successful employment outcomes. The second challenge with referrals as outlined in the handbook involved ensuring that job-ready participants are directed to “suitable employment.” When veterans are referred to the Disabled Veterans’ Outreach Program at the job-ready stage, Disabled Veterans’ Outreach Program and VA staff are supposed to coordinate to find “suitable employment,” or employment that will not aggravate the participant’s disability and follows the participant’s rehabilitation plan. State-level Labor officials noted that, in some cases, veterans may choose to accept jobs they want or need but that do not fit in their employment or rehabilitation plan. Such jobs do not count as “suitable employment” for VA because the job may, in the long run, aggravate the veteran’s disability. While the handbook says agencies are to coordinate to achieve “suitable employment,” it does not explicitly say how Disabled Veterans’ Outreach Program and VA staff should deal with situations where a veteran’s financial need or preferences do not align with the goal of suitable employment. Absent guidance about how to navigate such situations, program staff may be working at cross purposes and program participants may be taking employment they cannot retain in the long run. This employment, in turn, may make a veteran’s disability worse and may make finding future employment more difficult. One official stressed that having labor market information incorporated into rehabilitation plans early may help veterans avoid taking a job that does not match their plans. DOD is expanding its employment assistance to National Guard and Reserve members, but does not have employment service agreements with Labor or VA beyond an agreement for TAP. In fiscal year 2011, DOD launched an employment assistance initiative under the Yellow Ribbon program, known as the Employment Initiative Program, that provides job workshops and job fairs to connect Guard and Reserve members to employers. The Employment Initiative Program under the Yellow Ribbon Program has hired and placed 56 “Employment Transition Coordinators” covering all 50 states, territories, and the District of Columbia who provide service members employment assistance among other services. The Yellow Ribbon Program has also held 27 job fairs since the beginning of fiscal year 2012. To support the job fairs, the Yellow Ribbon Employment Initiative Program leverages the network of 4,900 volunteers who are affiliated with ESGR. These volunteers also provide resume-building workshops, mock interviews, and career counseling. DOD also recently testified that it is leading, per a White House directive, a new Credentialing and Licensing Task Force to address gaps between military occupational specialties and civilian licensing requirements. DOD reported that this additional employment assistance is needed to support Guard and Reserve members who may not meet veteran status requirements necessary for participating in Labor or VA programs. Most of the ESGR representatives we spoke with also anticipated the program would continue to provide employment-related services. Although DOD has established these employment assistance services, no agreement or formal mechanism has been established for coordinating Specifically, them with Labor’s and VA’s veterans’ employment efforts. there is no interagency agreement for coordinating employment services beyond DOD’s and Labor’s work on the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) and TAP. Although DOD and VA have an agreement, it focuses on connecting service members who are leaving the military for civilian life with vocational rehabilitation services. Further, ESGR has no formal mechanism for identifying and referring eligible veterans to the Disabled Veterans’ Outreach and Employment Representative programs. We have previously reported that agencies with common goals and programs can enhance and sustain collaboration by creating mutually agreed-upon strategies to help align agencies’ activities and leverage resources to meet their common goals. Currently, ESGR in the states we reviewed reported informal coordination—such as meetings and co-participation in job fairs—with Labor-funded programs. For example, a DOD official noted that the Washington ESGR used a grant to hire 13 employment transition counselors in areas that needed service not provided by the state workforce agencies. According to this official, this ultimately increased impact while saving funds. However, this informal coordination may be affecting Labor resources and confusing employers. According to Labor officials, Disabled Veterans’ Outreach Program staff participation at DOD job fairs reduces the amount of time available for their primary duties, such as providing intensive services to program participants. A variety of officials from the states we reviewed also said that some employers were confused regarding which agency was leading the initiatives to employ veterans. Employment outcomes for veterans’ programs have generally not regained levels attained prior to the recent recession. (See appendix II for performance outcomes for each veterans’ program as well as veteran participants served by WIA Adult and ES programs over a 5-year period.) From program years 2007 to 2009—which spanned July 2007 to June 2010—most Labor veterans’ programs that have outcome measures saw a decline in their entered employment rate and a slight decline in their 6-month job retention rates. In program year 2010, all programs except VWIP had lower entered employment and employment retention rates than in program year 2006, prior to the recession. The number of VA Vocational Rehabilitation Program participants who were rehabilitated to employment has also declined from 9,225 participants in fiscal year 2006, to 7,975 participants in fiscal year 2011. Officials at both VA and Labor attributed the declines to various causes. For example, VA officials attribute some of the decline in the number of participants rehabilitated to the establishment of the Post-9/11 GI Bill Program. The Post-9/11 GI Bill Program is an education benefit administered by VA for individuals who served on active duty after September 10, 2001. According to VA officials, VA’s Vocational Rehabilitation Program lost some participants who had begun rehabilitation efforts but switched to the Post-9/11 GI Bill Program. They switched, according to VA officials, because the GI Bill Program provided a more generous living stipend than the Vocational Rehabilitation Program. At the same time, Labor officials identified national economic conditions as the primary reason for the drop in performance of its programs. In addition to the decline in outcomes for veterans’ programs, veterans participating in broader workforce programs also achieved somewhat lesser outcomes than those in the general population. (See app. II, figs. 7 and 8.) From program years 2007 to 2009, the WIA Adult and ES programs saw declines in measures for the percentage of participants who entered employment and the percentage who retained their employment for 6 months. These measures have generally rebounded slightly in 2010, although they have generally not regained levels attained prior to the recent recession. Since 2006, veterans have had slightly lower entered employment outcomes than those for all participants using the ES Program. In the WIA Adult Program, veterans’ employment and retention outcomes have been slightly lower than outcomes for all participants since 2009. Further, between 2006 and 2010, employment and retention outcomes were similar but slightly lower for veterans who worked with Disabled Veterans’ Outreach and Employment Representative program staff, in comparison with outcomes for veterans in the WIA Adult Program. According to Labor officials, some of these differences in outcomes may be explained by differences in characteristics of the populations served. They noted that veteran participants in the WIA Adult Program are more likely to be over the age of 55 than nonveteran participants, and historically, older workers have achieved lower outcomes in both the WIA Adult and ES programs. In addition, Labor officials stated that because the Disabled Veterans’ Outreach and Employment Representative programs serve veterans who face barriers to employment, their outcomes are likely to be lower than outcomes for veterans who are job- ready and nonveterans served by the WIA Adult or ES programs. While Labor reports some data on veterans’ program outcomes, it does not report the extent to which each of these programs is achieving its established performance goals. Labor provides Congress an annual veterans’ program report that provides certain performance information, such as the number of disabled and recently separated veterans who received intensive services. For this annual report, however, Labor is not required to report program outcomes in relation to performance goals. Labor sets annual performance goals for its veterans’ programs, but it is not reporting the results relative to those goals. In previous fiscal years, Labor included some of this information for the Disabled Veterans’ Outreach Program, Employment Representative Program, Homeless Veterans’ Reintegration Program, and VWIP in its agencywide performance report. However, in fiscal year 2011, it only reported aggregate goals for three programs, rather than the separate outcomes and goals it maintains for each of these veterans’ programs. In contrast, Labor’s website on general employment programs—WIA Adult and ES— includes both performance goals and outcomes. This information includes a national average for each measure comparing goals against performance, as well as each state’s negotiated goals and performance against those goals. Further, VA reports both an employment outcome and associated goal for the Vocational Rehabilitation Program. We have previously reported that relevant performance information should be reported both internally and externally in order to maintain accountability and transparency for achieving results. Without information on how the outcomes for each veterans’ program compare against their annual performance goals, Congress and other key stakeholders lack essential information needed to assess the performance of the program. Labor is working to implement new performance measures which have been mandated by the VOW to Hire Heroes Act of 2011 (VOW Act).Specifically, the act requires Labor to measure participants’ median earnings 90 and 180 days after a participant stops using a veterans’ program. Prior to the VOW Act, Labor only measured participants’ average earnings over 6 months after participants stop using a veterans’ program, for those who retained employment. The VOW Act also requires Labor to track the percentage of participants obtaining a certificate, degree, diploma, licensure, or industry-recognized credential after participating in its veterans’ programs. VA also plans to collect additional information about its programs’ outcomes. VA officials said that they decided to track the number, in addition to the rate, of veterans rehabilitated to employment, because the employment rehabilitation rate can fluctuate based on a number of factors. employment in fiscal year 2012. VA officials said that this is the first fiscal year this goal has been used. Consequently, VA has not yet reported its performance against this goal. VA has set a national goal to rehabilitate 9,000 veterans to In addition, the Vocational Rehabilitation Program has established a working group to develop new national performance measures. According to VA officials, the new measures will focus on the middle of the rehabilitation process, because a veteran can be in the program from 1 to 6 years, with an average of 4 years. The measures that already exist focus on the front-end (e.g., timeliness of services) and back-end (e.g., outcomes). Although the new measures have not been finalized, VA plans to implement them in fiscal year 2014, contingent on resources to make changes to the program’s database structure to capture data and report on new measures. For example, the rehabilitation rate can be negatively affected by veterans who choose to stop participating before completing a rehabilitation plan. participant outcomes, these studies can be difficult and potentially expensive to conduct. Impact evaluations can be designed in several ways, but fall into two basic design categories: experimental, using random assignment, and quasiexperimental. Quasiexperimental designs use a comparison group that is not created with random assignment. While Labor has not conducted impact evaluations, it has conducted research that examines veterans’ outcomes in relation to their characteristics and has other studies planned or under way (see table 2). These studies, though, have limitations. For example, Labor’s 2007 study of veterans’ outcomes covered five states, and its findings cannot be generalized to all states. In addition, in the study conducted on the Homeless Veterans’ Reintegration Program, researchers lacked access to participant-level data and consequently could not determine whether certain veterans’ characteristics were associated with positive or negative employment outcomes for the program as a whole. Labor is funding an evaluation of the pilot of the redesigned TAP, but has not conducted any studies or evaluations of VWIP in the last 10 years. While Labor has not conducted impact evaluations of its veterans’ employment and training programs, it is funding an impact evaluation of the WIA Adult and Dislocated Worker programs, which is planned to be completed in 2015. This study will include a supplemental study of veterans using the public workforce system, but this portion of the study, as described in the draft research plan for the study, is not an impact evaluation and cannot determine the extent to which veterans’ outcomes are due to the services they receive in the public workforce system. Similar to Labor, VA has not conducted evaluations that allow it to determine if veterans’ employment outcomes result from program services or if they are the result of other factors. As shown in table 3, VA has funded research that examines data related to the completion of veterans’ rehabilitation plans and participant outcomes. For example, VA is funding a longitudinal study of Vocational Rehabilitation Program participants and has issued two reports on the study. The most recent report begins to analyze VA administrative data to determine characteristics associated with completing rehabilitation or discontinuing the program within the first 2 years. However, the report states that its findings thus far are only descriptive and may have little or no predictive value. VA plans further study of emerging trends. VA also plans additional follow-up of program participants in its case management process. Specifically, the agency plans to send a questionnaire to collect information on whether former participants are employed and whether they need additional services. Given that the number of service members transitioning to civilian employment is expected to increase and the number of veterans with service-connected disabilities is on the rise, Labor’s Disabled Veterans’ Outreach Program is likely to see an increased demand for its services. Labor attempts to maximize the employment services for those veterans who need them most. However, we found that there is a need for clearer guidance to states on how to prioritize services and additional monitoring of their implementation of such guidance. Labor said it is developing such guidance but has not completed it, and has tested new monitoring protocols in six states but has not finalized them. It is encouraging that Labor has these efforts under way, and it will be important for the department to complete both efforts. Labor and VA both provide employment and training programs targeted to veterans. Although Labor and VA have a handbook governing their coordination with respect to employment and training for veterans, it has not been updated since 2008. Our work identified sections of the handbook that provided insufficient guidance, resulting in situations where the practices of one department presented difficulties for the other in meeting desired program outcomes. At the same time, DOD has begun expanding employment assistance initiatives to segments of the veteran population, such as National Guard and Reserve members, some of whom may also meet Labor and VA veterans’ programs eligibility requirements. However, Labor and VA’s agreement does not govern their coordination with DOD’s programs. Without an agreement that includes all three departments, efforts to help veterans find employment are at greater risk of being fragmented or overlapping, and may not leverage federal resources. Finally, the federal investment in veterans’ employment and training programs warrants greater transparency with regard to the extent to which these programs are meeting their performance goals and whether outcomes are attributable to program participation and not other factors. Labor reports substantial information on outcomes for these programs. However, Labor is not consistently reporting the extent to which outcomes for each of its veterans’ programs are achieving the specific performance goals that were established for these programs. This stands in contrast to the level of performance reporting by Labor for its WIA Adult and ES programs, which identifies the extent to which outcomes in these programs are achieving performance goals. In addition, while the federal government makes a substantial investment in Labor and VA programs to achieve employment outcomes for veterans, neither agency has conducted studies to see if these outcomes can be attributed to the programs’ services, instead of other factors. As a result, Congress and other stakeholders lack essential information to assess how well these programs are performing and hold federal agencies accountable for achieving results. We are making the following four recommendations based on our review: To increase the effectiveness of coordination efforts, the Secretaries of Labor and VA should incorporate additional guidance to address the two problem areas we identified into any update to the interagency handbook that governs their coordination for veterans’ employment and training programs. To ensure government resources are used efficiently, the Secretaries of Labor, VA, and DOD should incorporate DOD’s employment assistance initiatives into the agreements that guide interagency coordination. To enhance transparency and accountability for achieving results, the Secretary of Labor should consistently report both performance goals and associated performance outcomes for each of its veterans’ employment and training programs. To assess veterans’ employment programs’ effectiveness, Secretaries of Labor and VA should, to the extent possible, determine the extent to which veterans’ employment outcomes result from program participation or are the result of other factors. We provided a draft of this report to the Department of Labor, the Department of Veterans Affairs, and the Department of Defense for review and comment. Written comments from Labor, VA, and DOD appear in appendixes III, IV, and V, respectively. In addition to the comments discussed below, Labor, VA, and DOD provided technical comments that we incorporated where appropriate. All three agencies generally concurred with our recommendations. Both Labor and VA said they would work to enhance coordination with each other with respect to the guidance in their interagency handbook. All three agencies said they would work to ensure interagency coordination included DOD. In response to our recommendation on reporting program performance, Labor said it will explore ways to increase consistency and transparency of the information it reports. In response to our recommendation to Labor and VA regarding assessing program effectiveness, VA concurred and Labor did not specify whether or not it agreed. Labor said that it is committed to robust program evaluation and that each agency, including VETS, develops an annual evaluation agenda and sets priorities. Labor said it has a multi-component agenda for evaluating services to veterans and cited some current studies, such as a study of the TAP program and a statistical analysis of services received by veterans and their outcomes using the public workforce system. We think obtaining information about the effectiveness of veterans' programs is important because such information can assist Congress in assessing program results and identifying areas where adjustments may be needed. As Labor and VA conduct research on program outcomes, it will be important for them to consider approaches that would enable them to separate the impact of their programs from other factors that might influence participants’ outcomes. As agreed with your offices, unless you publicly announce the contents of this report earlier, we plan no further distribution until 30 days from the report date. At that time, we will send copies of this report to appropriate congressional committees, the Secretary of Labor, the Secretary of Veterans Affairs, the Secretary of Defense, and other interested parties. In addition, this report will be available at no charge on GAO’s website at http://www.gao.gov. If you or your staff have any questions about this report, please contact me at (202) 512-7215 or sherrilla@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix VI. In a January 2011 report, we identified six employment and training programs administered by the Department of Labor (Labor) and the Department of Veterans Affairs (VA) targeted toward veterans as a part of a larger review of all federal employment and training programs. We defined an employment and training program as one specifically designed to enhance the specific job skills of individuals in order to increase their employability, identify job opportunities, or help job seekers obtain employment. Labor oversees five of these programs for veterans: (1) the Disabled Veterans’ Outreach Program, (2) the Homeless Veterans’ Reintegration Program, (3) the Local Veterans’ Employment Representative Program (Employment Representative Program), (4) the Transition Assistance Program (TAP), and (5) the Veterans’ Workforce Investment Program (VWIP). VA oversees the sixth program called the Vocational Rehabilitation & Employment Program (Vocational Rehabilitation Program).requirements, and outcome measures that these programs had in common. Our 2011 report identified services, eligibility For this report, we focused on the six programs identified in our January 2011 report in more detail and examined (1) the extent to which federal veterans’ employment and training programs vary in terms of the services they deliver and the veterans who receive them; (2) the extent to which federal agencies coordinate these programs; and (3) what is known about the performance of these programs. Our approach overall involved reviewing relevant literature, relevant federal laws and regulations, and analyzing Labor and VA data on veteran participants, services provided, and performance. We also interviewed federal Labor, VA, and Department of Defense (DOD) agency officials who govern agency policy at the national level and key stakeholder associations. To determine the extent to which these programs vary in terms of the services they deliver and the veterans receive them, we analyzed Labor and VA data on services provided and veteran participants, agency annual reports, budget justifications, and other agency policy documents. To assess the reliability of Labor’s data on services to veterans in one- stops, we reviewed available information about the data and conducted interviews with officials knowledgeable about the data. We determined that these data were sufficiently reliable for our purposes. We reviewed relevant federal laws and regulations to determine program eligibility requirements. We interviewed agency officials, veterans’ service organizations, and workforce associations to better understand why programs may serve similar populations with similar services. We reviewed state plans and interviewed state-level Labor, VA, and DOD staff for our case study states. In addition, we conducted six case studies at the state level. In each state, we reviewed state plans and interviewed Labor and VA officials assigned to the state or the region. We also interviewed the Employer Support of the Guard and Reserve (ESGR) chairperson operating in the state. These are federal representatives of DOD, but not federal employees, as they are volunteers. In addition, we interviewed the directors of state workforce agencies, which carry out veterans’ employment and training programs using federal funds. Finally, within three states, we interviewed the Director of Veterans Affairs in each state, a state government official responsible for veterans’ programs and services. To select states, for all 50 states, we determined whether each was high, medium, or low on the following characteristics: the percentage of veteran population, amount of program expenditures, program performance (veterans’ entered employment rate), and veterans’ unemployment rate. We selected one state from each of Labor’s six regions to achieve variation on the above characteristics, as well as diversity in terms of geography and state size. These states were Florida, Massachusetts, Ohio, Oregon, Texas, and Virginia. To determine the extent to which federal agencies coordinate these programs, we reviewed key agency agreements and guidance, and used the same six case studies at the state level, and interviewed federal and state agency officials and associations representing the interests of veterans. In examining coordination we included not only the five programs indicated above but also three Labor programs available to the general population: the Workforce Investment Act (WIA) Adult and Dislocated Worker and the Employment Service (ES) programs. We also included programs recently begun by DOD: the Yellow Ribbon and ESGR programs. We reviewed memoranda of understanding, agency guidance, and other policy documents related to collaborative efforts among federal agencies. We also interviewed National Veterans’ Training Institute officials to discuss the extent to which required training for outreach specialists and employment representatives includes instruction on how to foster inter- and intra-agency coordination. In our case studies in six states, we interviewed state-level officials from the Veterans’ Employment and Training Services, as well as VA officials. We also interviewed ESGR officials and Directors of State Offices of Veterans Affairs. To understand stakeholders’ views on coordination, we interviewed officials from workforce associations and veterans’ service organizations. We also used data from the Defense Manpower Data Center to determine the number of Guard and Reserve members that may meet the eligibility requirements for Labor veterans’ programs and VA’s Vocational Rehabilitation Program. We assessed the reliability of information on Guard and Reserve members’ length of service and disability status, and determined that these data were sufficiently reliable for the purposes of this report. To determine what is known about program performance, we analyzed relevant federal laws and regulations, and agency documents, and interviewed agency officials and stakeholders. We reviewed agency reports on veterans’ programs containing information on program outcomes and agency goals established for these programs, such as Labor’s annual report to Congress on veterans’ programs and agencywide performance reports. We assessed Labor and VA data on participant employment outcomes by reviewing available information about the data and conducting interviews with officials knowledgeable about the data. We determined that these data were sufficiently reliable for our purposes. We reviewed the design and methodology of relevant agency-sponsored program evaluations using GAO criteria on program evaluation design. We also interviewed Labor and VA national and regional officials. In addition to the individual named above, Patrick Dibattista (Assistant Director), Sheranda Campbell, Maria Gaona, and Dana Hopings made key contributions to this report. In addition, key support provided by James Bennett, David Chrisinger, Holly Dye, Rachel Frisk, David Forgosh, Alexander Galuten, Kathy Leslie, Ashley McCall, and Walter Vance.

Summary: In fiscal year 2011, the federal government spent an estimated $1.2 billion on six veterans' employment and training programs, serving about 880,000 participants. Labor administers five of these programs and VA administers one. Despite these efforts, the unemployment rate for veterans who have recently separated from the military is higher than that for the civilian population. The number of service members transitioning to the civilian workforce is expected to increase. In response to a request, this report examines (1) the extent to which federal veterans' employment and training programs vary in services they deliver and veterans who receive them; (2) the extent to which federal agencies coordinate programs; and (3) what is known about the performance of these programs. To address these objectives, GAO reviewed agency data, policy documents, and relevant federal laws and regulations, reports, and studies, and interviewed federal and regional officials and state officials in six states selected to achieve geographic and demographic diversity. In examining coordination, GAO included in its review employment assistance DOD provides to Guard and Reserve members. The six federal veterans' employment and training programs offer similar employment services, but largely target different groups. Among these programs, the Department of Labor's (Labor) Disabled Veterans' Outreach Program has the greatest potential for overlap with other veterans' programs and Labor's employment programs for the general population. Federal law governing the Disabled Veterans' Outreach Program makes all veterans who meet the broad definition of "eligible veteran" eligible for its services, but gives disabled veterans and economically and educationally disadvantaged veterans the highest priority for services. However, Labor's guidance does not provide states--who administer the program using federal funds--criteria for prioritizing services. The law also generally requires that program staff provide participants with intensive services (e.g., individual employment plans), but Labor's data indicate that nationally 28 percent of participants received such services in 2011. In explaining this statistic, Labor officials said one possible explanation was that staff are enrolling people who do not need intensive services. Labor said it plans to develop guidance on prioritizing services, and it also has a six-state pilot to improve monitoring, but neither of these efforts has been completed. In 2008, Labor and the Department of Veterans Affairs (VA) compiled a handbook intended to guide the roles of their respective staff in coordinating services to disabled veterans; however, they have not updated the handbook nor included related Department of Defense (DOD) employment initiatives in their interagency agreements. GAO's interviews with VA and Labor officials identified certain challenges with meeting desired program outcomes resulting, in part, from sections of the handbook that provide insufficient guidance or are subject to misunderstanding. For example, the handbook says Labor and VA are to coordinate to achieve "suitable employment"--employment that follows the veteran's rehabilitation plan and does not aggravate the disability. However, it does not explicitly say how staff should navigate situations where a veteran's financial need or preferences do not align with this goal. In such instances, program staff may work at cross purposes and veterans may accept jobs that do not count as suitable employment. Further, DOD is expanding its employment assistance, but does not have an interagency agreement to coordinate with Labor and VA efforts. Absent an updated handbook and integration of DOD into the coordination framework, there is increased risk for poor coordination and program overlap. While available performance information shows that most programs' outcomes are below pre-2007 levels, the information Labor reports and the research it has conducted make it difficult to know the extent to which each program is achieving its annual performance goals. Veterans' employment outcomes for programs administered by both Labor and VA have generally not regained levels seen before the recession that began in 2007, which is similar to employment programs for the general population. In reporting performance, Labor does not relate employment outcomes to individual program goals. In contrast, Labor reports outcomes and goals for its other workforce programs aimed at the general population. Moreover, while both agencies have studies completed or under way, neither has conducted impact evaluations that assess program effectiveness to determine whether outcomes are attributable to program participation and not other factors. As a result, Congress and other key stakeholders lack essential information needed to assess each program's performance. GAO is making four recommendations aimed at improving the guidance provided to staff in the coordination handbook, integrating DOD into the interagency coordination framework, improving agency reporting on achievement of program performance goals, and assessing program effectiveness. GAO is making four recommendations aimed at improving the guidance provided to staff in the coordination handbook, integrating DOD into the interagency coordination framework, improving agency reporting on achievement of program performance goals, and assessing program effectiveness.