Republican Budget Cuts Collide with Job Training to Assist Businesses

Republican Budget Cuts Collide With Job Training to Assist Businesses
By Catherine Dodge - Apr 1, 2011 12:01 AM ET

Michael Conner, an executive with Cincinnati-based Frisch’s Restaurants Inc. (FRS), says he’s all for the Republican push to shrink government spending -- except when it comes to job-training programs that help businesses.

In their quest for deep government spending cuts, U.S. House Republicans passed a budget bill that would slash funding for a nationwide program that trains unemployed workers and helps them find jobs with companies looking for qualified employees. Conner and other critics say that provision is at odds with Republicans’ pledge to bring down the jobless rate.

“I’m an advocate for small government, but this is certainly not the time nor the place for cutting of employment related funding,” said Conner, vice president of human resources at Frisch’s. The company, which operates Big Boy and Gold Corral restaurants, has about 8,600 workers and uses the training program.

State and local employment officials also complain that the proposed Republican cuts to the program would curtail job training during a fragile recovery from one of the worst economic slumps in U.S. history and cause job-assistance centers to shut down and fire workers.

Congress passed the Workforce Investment Act in 1998 with bipartisan support. The program funneled $3 billion in grants to states last year to help provide career and employment assistance.

Republican View

Some Republican lawmakers, in defending the proposed cuts, question the program’s success after a government report found inefficiencies.

Analysts say the push to significantly reduce the federal budget deficit will affect programs widely seen as worthwhile. “You are going to hit things inadvertently when the cuts are so sweeping,” said Ross Baker, a congressional scholar at Rutgers University in New Brunswick, New Jersey. Programs with a lot of support “get thrown in the throw-away pile.”

Under the Workforce Investment Act, local boards oversee employment and training services at more than 3,000 “one-stop” job centers across the country, which served more than 8 million people last year. The Republican budget plan for the rest of fiscal 2011 would eliminate the federal grants to states to operate the local training programs.

“With the general citizenry screaming for jobs and re- training, up against similar cries for fiscal restraint, we understand the challenges you are facing,” Conner, a Republican who chairs the Southwest Ohio Region Workforce Investment Board, wrote in a letter last month to House Speaker John Boehner, an Ohio Republican. “But we ask you to consider tempering decisions that will only make the economic recovery slower.”

House Bill

The House budget bill, passed Feb. 19, calls for overall spending cuts of $61 billion, which would kill more than 100 programs and reduce funding for hundreds more. The measure was rejected by the Democratic-controlled Senate, where lawmakers want a smaller package of cuts. Both sides are working on a compromise to avert a government shutdown that would include reductions of about $33 billion.

Boehner, under pressure from other Republicans and Tea Party activists to stand firm for the House spending cuts, said yesterday “there is no agreement on numbers and nothing will be agreed to until everything is agreed to.”

Boehner was among the Republicans who seized on the unemployment issue during the 2010 campaign, saying Democrats’ spending on economic stimulus failed to reduce the jobless rate.

‘Pretty Phenomenal’

Mary Margaret Garrett, who heads the Atlanta Regional Workforce Board, said the spending cuts that include job training programs would be “pretty phenomenal at a time when the economy is struggling.”

Garrett’s board provides job assistance in seven counties in the Atlanta region. About 65,000 people last year sought help at the area’s centers, getting guidance on writing resumes, conducting a job search, honing interviewing skills and other services.

Among those who completed a specific training program, 92 percent found jobs, Garrett said. “I understand budget cuts, but there’s a whole lot of trimming that can be done without totally abandoning a nationwide job-training system.”

Dozens of people who work at the Atlanta-area centers would lose jobs as a result of the cuts, she said.

Republican lawmakers supporting the cuts point to a January report by the Government Accountability Office that said little is known about the effectiveness of most federal job-training programs, and that overlap was extensive among the nine agencies administering 47 programs in the 2009 fiscal year. The report recommended efforts to consolidate administrative functions.

Oversight Lack

“Congress hasn’t done the job of oversight and putting metrics on programs to see what does work and what doesn’t,” said Senator Tom Coburn, an Oklahoma Republican.

Coburn also questions whether it’s the federal government’s role to provide job training. “There’s never going to be a good time to make the hard choices we have to make, but we’re going to make them,” he said.

Representative John Kline, a Minnesota Republican who chairs the House Education and Workforce Committee, said inefficiencies must be cleaned up.

“Cuts are being made in areas that were unthinkable before,” Kline said. “This morass that has become the Workforce Investment Act, that can has been kicked down the road for a long time by Republicans and Democrats, and we’re going to have to come to grips with that.”

In Illinois, where more than 200,000 people use services at the job-assistance centers annually, David Stoecklin, president of the Illinois Workforce Partnership that promotes job training and economic development, has a different perspective.

“Our program tends to make a return on the investment,” he said. People who find jobs “start paying back in taxes and they stop drawing unemployment insurance.”

Training programs would come to a “screeching halt,” if Republican cuts were to become law, he said.

To contact the reporter on this story: Catherine Dodge in Washington at cdodge1@bloomberg.net