The Trade Adjustment Assistance (TAA) program is the federal government’s primary program specifically designed to provide assistance to workers who lose their jobs as a result of international trade. In addition, to assist U.S. domestic industries injured by unfair trading practices or increases in certain fairly traded imports, U.S. law permits the use of trade remedies, such as duties on imported products. Currently, Labor certifies workers for TAA on a layoff-by-layoff basis. The process for enrolling trade-affected workers in the TAA program begins when a petition for TAA assistance is filed with Labor on behalf of a group of workers. Petitions may be filed by the employer experiencing the layoff, a group of at least three affected workers, a union, or the state or local workforce agency. Labor investigates whether a petition meets the requirements for TAA certification and is required to either certify or deny the petition within 40 days of receiving it. The TAA statute lays out certain basic requirements for petitions to be certified, including that a significant proportion of workers employed by a company be laid off or threatened with layoff and that affected workers must have been employed by a company that produces articles. In addition to meeting these basic requirements, a petition must demonstrate that the layoff is related to international trade in one of several ways: Increased imports—imports of articles that are similar to or directly compete with articles produced by the firm have increased, the sales or production of the firm has decreased, and the increase in imports has contributed importantly to the decline in sales or production and the layoff or threatened layoff of workers. Shift of production—the firm has shifted production of an article to another country, and either: the country is party to a free trade agreement with the United States; or the country is a beneficiary under the Andean Trade Preference Act, the African Growth and Opportunity Act, or the Caribbean Basin Economic Recovery Act; or there has been or is likely to be an increase in imports of articles that are similar to or directly compete with articles produced by the firm. Affected secondarily by trade—workers must meet one of two criteria: Upstream secondary workers—affected firm produces and supplies component parts to another firm that has experienced TAA-certified layoffs; parts supplied to the certified firm constituted at least 20 percent of the affected firm’s production, or a loss of business with the certified firm contributed importantly to the layoffs at the affected firm. Downstream secondary workers—affected firm performs final assembly or finishing work for another firm that has experienced TAA-certified layoffs as a result of an increase in imports from or a shift in production to Canada or Mexico, and a loss of business with the certified firm contributed importantly to the layoffs at the affected firm. Labor investigates whether each petition meets the requirements for TAA certification by taking steps such as surveying officials at the petitioning firm, surveying its customers, and examining aggregate industry data. In the surveys, Labor obtains information on whether the firm is now importing products that it had once produced or whether its customers are now importing products that the firm produced. They also obtain information on whether the firm has moved or is planning to move work overseas and, to identify a secondary impact, whether the layoff occurred due to loss of business with a firm that was certified for TAA. When Labor has certified a petition, it notifies the relevant state, which has responsibility for contacting the workers covered by the petition, informing them of the benefits available to them, and telling them when and where to apply for benefits. If Labor denies a petition for TAA assistance, the workers who would have been certified under the petition have two options for challenging this denial. They may request an administrative reconsideration of the decision by Labor. To take this step, workers must provide reasons why the denial is erroneous based on either a mistake or misinterpretation of the facts or the law itself and must mail their request to Labor within 30 days of the announcement of the denial. Workers may also appeal to the U.S. Court of International Trade for judicial review of Labor’s denial. Workers must appeal a denial to the Court within 60 days of either the initial denial or a denial following administrative reconsideration by Labor. Under TAA, workers certified as eligible for the program may have access to a variety of benefits: Training for up to 130 weeks, including 104 weeks of vocational training and 26 weeks of remedial training, such as English as a second language or adult basic education. Extended income support for up to 104 weeks beyond the 26 weeks of unemployment insurance (UI) benefits available in most states. Job search and relocation benefits fund participants’ job searches in a different geographical area and relocation to a different area to take a job. A wage insurance benefit, known as the Alternative Trade Adjustment Assistance (ATAA) program, pays older workers who find a new job at a lower wage 50 percent of the difference between their new and old wages up to a maximum of $10,000 over 2 years. A health coverage benefit, known as the Health Coverage Tax Credit (HCTC), helps workers pay for health care insurance through a tax credit that covers 65 percent of their health insurance premiums. In addition, case managers provide vocational assessments and counseling to help workers enroll in the program and decide which services or benefits are most appropriate. Local case managers also refer workers to other programs, such as the Workforce Investment Act, for additional services. The United States and many of its trading partners have used laws known as “trade remedies” to mitigate the adverse impact of certain trade practices on domestic industries and workers, notably dumping—when a foreign firm sells a product in the United States at a price below fair market value—and foreign government subsidies that lower producers’ costs or increase their revenues. In both situations, U.S. law provides that if dumped or subsidized imports injure a domestic industry, a duty intended to counter these advantages be imposed on imports. Such duties are known as anti-dumping and countervailing duties. In addition, in the event of an increase in imports of a certain product, safeguards, such as quotas or tariffs, may be applied to these products to provide an opportunity for domestic industries to adjust to increasing imports. As of March 30, 2007, there were 280 antidumping and countervailing duty orders, and according to officials at the ITC, there were no safeguard measures in place. The process for imposing a trade remedy begins when a domestic producer files for relief or when the Department of Commerce (Commerce) initiates the process, followed by two separate investigations: one by Commerce to determine if dumping or subsidies are occurring, and the other by the ITC to determine whether a domestic U.S. industry is materially injured by such unfairly traded imports or, in the case of safeguards, experiences serious injury from a rise in imports. As a result of an affirmative determination by both Commerce and the ITC in an antidumping or countervailing duty investigation, a duty is imposed on the imported good that can reflect the difference in the price in the foreign market and the price in the U.S. market, known as the “dumping margin,” or the amount of the foreign subsidy. In the case of an affirmative determination in a safeguard investigation, the ITC provides the President with one or more recommendations for remedying the situation, such as a tariff or quota on an imported product. The President may implement or modify the recommendations, or take no action due to U.S. economic or national security interests. Labor certified two-thirds of petitions that it investigated over the past 3 fiscal years, certifying nearly 4,700 petitions, covering an estimated 400,000 workers (see table 1). Over the past 3 fiscal years, the number of petitions certified has declined 17 percent, from nearly 1,700 in fiscal year 2004 to 1,400 in fiscal year 2006. This decline parallels a decline in the number of petitions filed. Labor has generally processed petitions in a timely manner over the past 3 fiscal years. Labor’s average processing time has remained relatively steady, taking on average 32 days to conduct an investigation and determine whether to certify or deny the petition. Labor met the requirement to process petitions within 40 days for 77 percent of petitions it investigated during fiscal years 2004 to 2006 (see fig. 1). Labor most often took only an additional day to process the remaining petitions, and 95 percent were completed within 60 days. Labor officials said that they are not always able to meet the 40-day time frame because they sometimes do not receive necessary information in a timely manner from company officials. In fiscal year 2006, the most common reason petitions were denied was that workers were not involved in producing an article, a basic requirement of the TAA program. Of the more than 800 petitions filed in fiscal year 2006 that were denied, 359 (44 percent) were denied for this reason (see fig. 2). Of those petitions denied because workers did not produce articles, most came from two industries, business services, such as computer programming, and airport-related services, such as aircraft maintenance (see app. II for the complete list of industries that had petitions denied by reason for the denial). During the past 3 fiscal years, workers appealed decisions in 16 percent of the approximately 2,600 petitions that Labor initially denied, with the vast majority appealed to Labor. Labor’s decisions were reversed in one-third of the appeals (see fig. 3). Labor officials told us that appeals are often reversed because Labor receives new information from petitioners or company officials, as part of the appeals process, that justifies certifying the petition. Although few denied petitions are appealed to the U.S. Court of International Trade—42 in the last 3 fiscal years—many of the recent appeals concern the issue of whether workers were involved in the production of articles.