Labor Department Announces $100M in Grants to Reskill Displaced Workers

Labor Department Announces $100M in Grants to Reskill Displaced Workers

The US Department of Labor announced last week that it was making available $100 million in “Trade and Economic Transition National Dislocated Worker Grants,” which will fund training and career services programs for workers affected by “major economic dislocations.” These grants will be disbursed to states, outlying areas, local workforce development boards, and other entities, by the department’s Employment and Training Administration, and are meant to address a variety of workforce challenges, including:

  • The economic and workforce impacts associated with job loss or employer/industrial reorganization due to trade or automation;
  • The loss, significant decline, or major structural change/reorganization of a primary or legacy industry, such as a manufacturing downturn due to technological advances, including impacts on the agricultural industry due to trade or other economic trends;
  • Other economic transition or stagnation that may disproportionately impact mature workers, putting them at risk for extended unemployment, lower wages, and underemployment.

Applications for grants are due by September 7, and the administration plans to begin awarding funds by September 30. It will continue to fund qualifying applications in the order they are received until all of the allocated funds are spent.

This is the first major initiative from the Trump administration focused on protecting the workforce from automation-related displacement. Treasury Secretary Steven Mnuchin took criticism last year when he downplayed the potential impact of automation on job loss, arguing that technological displacement would not be an issue for another 50 years or more.

The latest global forecast from the OECD found that job loss from automation would probably not be as severe as many people fear, but the advent of robotics and AI will still displace or radically change tens of millions of jobs in the developed world. The OECD also warned that the people whose jobs are most at risk from automation are also the least prepared to transition into the new jobs created by an automated digital economy, underlining the need for robust reskilling programs to prepare the workforce for the future. Technological advancement is not the only big-picture change affecting US workers, however; the reorientation of US trade policy, the evolving nature of globalization, and global economic trends also have an impact, as the department’s announcement noted.

The grant program announced last week is part of a range of efforts the Labor Department is making to address the skills gap and the impact of these economic shifts on the US workforce. It is also in the process of developing new rules to allow trade associations and other nongovernmental organizations to certify work-based learning programs without having to go through the existing federal and state registered apprenticeship system, based on an executive order President Donald Trump issued last year.

SHRM’s Roy Maurer hears from a proponent of the new rules that they are being issued in response to complaints from employers that existing regulations on apprenticeship programs are too restrictive:

Katie Spiker, federal policy analyst at the National Skills Coalition, a Washington, D.C.-based group advocating for investments in workforce development, pointed out that under current law, the DOL or a state agency registers apprenticeship programs, documenting that the structure of the program’s on-the-job learning, classroom instruction, mentoring and safety components meet certain standards. The programs are subject to regulations describing the types of occupations for which apprenticeships can be used, the structure of training, the expertise apprentices need to earn and compliance with equal employment opportunity rules. …

Last month the DOL announced $150 million in funds to support organizations to help businesses set up and run the new industry-recognized apprenticeship programs and another $1 million in funding to community-based organizations helping expand women’s access to apprenticeships and training for jobs in manufacturing, mining and construction.

Critics of the new model are concerned, however, that the administration is ceding too much oversight of these programs to industry associations, which could lead to lapses in quality control. Mary Alice McCarthy, director of the Center on Education and Skills at New America, told Maurer that this was an issue of concern, noting that Trump’s Task Force on Apprenticeship Expansion acknowledged “the risks of inconsistent standards and conflicts of interest that such a structure could present” in its own report to the president earlier this year.