Money for Retraining Displaced Workers is Running Out

Local workforce boards are telling dislocated workers in much of Wisconsin that there’s not enough money to help them retrain for new work. Citing unprecedented job losses and limited funding, agencies say they don’t want to overcommit themselves and let workers start programs without knowing that they’ll have the money to let them finish.

Last week, executives from Wisconsin’s workforce investment boards met with state Department of Workforce Development Secretary Roberta Gassman pleading their cases.

"We’re concerned. Why put people in training and not let them complete? And a lot of people are in two-year training. So we’re watching that real closely," said Bob Borremans, executive director of the Southwest Wisconsin Workforce Development Board, which covers the Janesville area. "We’re going to probably take a cautious approach to bringing new people in. I know other workforce boards are already putting people on waiting lists because they do not have funding."

The Milwaukee Area Workforce Investment Board informed its staff last month that it was suspending new training vouchers because requests in the pipeline already exceeded available funding.

"We’re just projecting out at this point what it would take to complete the commitments that we have," said Don Sykes, president and chief executive officer of the Milwaukee board. "We figure we can handle it. We’re trying to just go slow enough to make sure."

Meantime, the board is recalculating projections, applying for additional funds and stepping up other services for dislocated workers, including outplacement orientation, job search consulting, résumé writing and basic computer skills classes.

A spokesman for the state Department of Workforce Development said it has taken a $10.4 million hit this year in the federal funding it passes down for dislocated worker training – a 40% cut – at the same time demand has escalated. Even $16 million in federal stimulus funds for dislocated workers hasn’t been enough.

Through the first nine months of the year, the number of workers dislocated from plant closings in the state is up 31% from a year ago. It’s nearly triple what it was in September 2007. Initial claims for unemployment insurance benefits so far this year are 18% higher than all of 2008, the first year of the recession.

Demand outstrips aid
At issue are federal funds passed through the state through assorted programs with various rules. The bottom line is that assistance for job retraining isn’t keeping up with demand from dislocated workers.

Mike Hall, 52, of Greenfield lost his job nearly a year ago in accounts payable at an equipment supply company in Milwaukee. Through counseling at the Hire Center, Hall enrolled in a one-year program to become a paralegal through Milwaukee Area Technical College.

Hall doesn’t know what the job market will be like when he graduates in December. He already has an internship in U.S. Bankruptcy Court. But he’s confident that his chances are better than if he hadn’t found a course and the retraining money to assist him.

"If it wasn’t for the Hire Center, there’s no way I could be in this program. I guess I’d be looking for work and surviving off of unemployment, which is basically all you can do is survive," Hall said. "There’s no way that I could be doing the classes that I’m taking, and the internship right now that I have with the judge would never have happened."

Hall has received about $6,000 in assistance to cover tuition and books for his coursework. And if his funding had been cut off before he finished?

"That would be very disheartening," Hall said. "It’s like losing your job all over again because you had money there that you were dependent on and making plans around, and suddenly it’s not there."

Technical college burden
Technical colleges are feeling the brunt of burgeoning demand for training. Enrollments in the Wisconsin Technical College System are projected to jump nearly 15% above last year’s record of full-time equivalent students, the system reported this week.

Especially in down economies, the system’s 16 colleges draw workers looking to improve employment opportunities or otherwise forestall job seeking. But they’re also go-to partners for workforce boards handling dislocated workers.

"What we’re concerned about is that there are not enough resources available to train all of the dislocated workers that are out there," said Morna Foy, vice president and executive assistant of the technical college system. "That’s been going on really since last fall. When the economy started tanking, our enrollments began creeping up pretty rapidly."

The Department of Workforce Development says it is working with local workforce boards to apply for national emergency grants and other funding so more unemployed workers can get retrained.

"We are working with our partners to do all that we can to help dislocated workers return to work and speed the nation’s economic recovery," said Richard Jones, a department spokesman.
In his 17 years administering workforce investment programs, James Golembeski said, he has never seen anything approaching the current mismatch between needs and resources. And the importance of retraining, he said, is greater than ever.

"When we come out of this recession, we’re not going to go back to what we had," said Golembeski, executive director of the Bay Area Workforce Development Board in Green Bay. "The new workplace coming out of this is going to be more efficient, faster paced, more responsive to the global market than ever. And workers are going to need whole new sets of skills just to keep going."


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