MANPOWER ACT OF 1969

WEDNESDAY, MARCH 4, 1970

HOUSE OF REPRESENTATIVES,

SELECT SUBCOMMITTEE ON LABOR,

COMMITTEE ON EDUCATION AND LABOR,

Washington, D.C. The subcommittee met at 10:15 a.m., pursuant to recess, in room 2175, Rayburn House Office Building, Hon. William A. Steiger presiding.

Present: Representatives Steiger and Gaydos.

Staff members present: Daniel H. Krivit, counsel; Sue Nelson, research assistant; Cathy Romano, research assistant; and Charles Radcliffe, minority counsel for education.

Mr. STEIGER. The subcommittee will come to order.

The first witness this morning is Dr. Garth L. Mangum, of the University of Utah, testifying on bills H.R. 10908, H.R. 11620, and H.R. 13472.

Mr. Mangum, it is a pleasure to welcome you to this subcommittee this morning. You may proceed in any way you wish. If you want to summarize, your statement will be made a part of the record, or you may proceed in any way you desire.

STATEMENT OF DR. GARTH L. MANGUM, McGRAW PROFESSOR OF ECONOMICS, UNIVERSITY OF UTAH, SALT LAKE CITY, UTAH

Dr. MANGUM. Thank you, Mr. Steiger. I will submit my written testimony for the record."

(The statement referred to follows:)

TESTIMONY OF DR. GARTH L. MANGUM, MCGRAW PROFESSOR OF ECONOMICS, UNIVERSITY OF UTAH, SALT LAKE CITY, UTAH

The three bills before this Subcommittee are the latest but not last step in a, to now, eight year experimental effort. Its objective has been to develop an effective system for remedying the disadvantages of a numerous and widely varying population who find it difficult to compete successfully in the labor market. Nearly every imaginable service which might lessen those disadvantages has been tried. The critical problem at the moment is to develop an effective delivery system. The current delivery system has at least three shortcomings : (1) The individual programs which emerged from the trial and error process require the needy individual to adapt to program requirements rather than having a variety of service functions packaged to fit his needs.

(2) The necessary federal initiative resulted in nationally set policies which may or may not coincide with local conditions.

(3) There is an almost total lack of accountability; programs are not effectively monitored or evaluated, and program operators are not rewarded according to performance and achievement.

The three bills before this body are aimed at improving this situation and any of the three would undoubtedly do so. All agree on the need to decategorize programs, pooling all budgets, authorizing all conceivable services, adapting the mix to local and individual need. They differ on the appropriate means for the second objective decentralization. Before discussing the relative strengths and weaknesses of the latter proposals, it may be useful to summarize the manpower policy experience of the last few years by function, program and agency. In doing so in a few brief pages, oversimplifications will be gross but the characterizations reasonably accurate.

A FUNCTIONAL APPROACH TO MANPOWER PROGRAMS

The manpower policy lexicon contains new terms and concepts emerging from the experiences of the past eight years. In general, a manpower service system is expected to:

-search out the disadvantaged (outreach)

-bring them in for service (intake)

-and identify their needs (testing)

-acquaint them with the requirements of the world of work (orientation) -give them enough exposure to alternative occupational choices to aid valid vocational decisions (prevocational training)

-offer remedial basic education including language training as necessary -provide entry level skill training for those not prepared for more extensive training

-use work experience as a method of training

-counsel the enrollee in choosing an occupation changing life styles and solving personal problems

-furnish relocation assistance as needed

-convince an employer to accept the disadvantaged employee, if necessary restructuring the job to fit the individual's capability and subsidizing the employer's hiring costs (job development)

-follow-up with a job coach to assist adjustment to work discipline

-provide various supportive services, depending upon personal obstacles to employment.

Since each of these service functions may be critical for a particular individual at a particular time, a complete manpower system would offer all of them. However, some are more important than others in the general case. Which should have priority requires diagnosis of causes. The initial notion was that failure to find employment during periods of high economic demand was evidence of personal deficiencies with skill training the best answer. This worked well for those who lived where jobs were available and were not overburdened by personal problems or blocked by discrimination. Limited success in central cities caused a shift in diagnoses with emphasis on institutional obstacles. Changing the hiring praetices of employers became the priority and funds were withdrawn from institutional training and reallocated to subsidizing private employment. With two years' experience it appears that some employers have the will to hire the disadvantaged, the staff and the profit margins to do so, and the kinds of jobs which can be filled by those with little skill. Others do not and want their employees "processed" to some minimum standards. Slackening labor markets then began to reverse the hiring process, trying up new slots and causing familiar "last in-first out" layoffs.

In retrospect and without reviewing the entire list of manpower functions, outreach has been rarely necessary since "walk-ins" have exceeded the limited capacity of the programs. Basic education (including language training in certain areas), skill training and job development have been the key functions, ingeneral. Work experience has been the most disappointing.

In program terms, this means that MDTA and NAB-JOBS have been the most important and most promising, though each individually has experienced limited success. Neighborhood Youth Corps, Operation Mainstream and such work experience programs have provided income and, by and large, useful activity to the poor but have done little to increace employability. MDTA by itself has served well those lacking only skills for access to jobs. In the central cities, it has too often been limited to preparing for low level, unattractive jobs which most could have obtained without training or providing a hunting license to search for unavailable jobs. Job development, in these circumstances, is as critical as basic education and skill training. The subsidized private employment of NAB-JOBS ap

pears to be the best way yet devised to develop jobs for the disadvantaged. But too few employers are wiling or able to provide decent jobs to the disadvantaged worker still encumbered by all of his personal disadvantages. Functionally, to marry basic education and skill training with a guarantee of employment through temporary subsidization is the most promising combination. In programmatic terms this would encompass a merger of the MDTA institutional and NABJOBS opportunities.

The slackening of job markets makes such a functional merger imperative, but for the reverse reasons. Unless institutional training provides a buffer for the laid-off NAB-JOBS enrollee, keeping him in the system and improving his skills, he will be back on the streets with his previous convictions about society's false promises reinforced.

The failure of work experience programs is disturbing. Most workers learn their jobs on the job. Why haven't they been made more employable as the result of program participation? My guess is that it is because neither administrators or enrollees consider enrollment to be the equivalent of a job. They welcome income and activity and consider the objectives achieved. This doesn't mean private employment is the only answer. It means that the jobs must be real. A program of subsidized public employment should have the same advantages and weaknesses as the program of subsidized private employment. Money could be better spent there than in work experience.

SHORTCOMINGS IN DELIVERY SYSTEMS

The delivery systems for the manpower services remain in disarray. The Concentrated Employment Programs (CEP's) was to bring all programs and services under the roof. If services could not be tailored to individual need, at least the individual should have a choice among the available programs. MDTA and WIN have remained outside of CEP. The critical function of skill training was absent. Job development has had limited success. Work experience programs were primarily places to park people while searching for something better for them. For most CEP enrollees there was simply no place to go. CAMPS planning has improved but is still best described as "separate agency plans held together by a common staple." Few would take seriously a planning process which lacked the power to reallocate budget and staff.

Glaring at the local level almost everywhere is the lack of any form of integrated planning and coordinated administration. States and others respond to the availability of federal dollars and almost entirely on federal terms. The durability and imperviousness of walls between programs, even those operated by the same agency is amazing.

Many state employment services have improved notably in their commitment to serve the disadvantaged; others not at all. Few Community Action Agencies have developed into effective deliverers of manpower services. Yet their vital role in community organization might not survive without the patronage available through manpower programs. Employment services are still able to play off their governors and the federal agency against each other. State and local public schools have many higher priorities than manpower programs.

The Labor Department's field staff is overwhelmed by the responsibility of negotiating, extending and renegotiating 30,000 contracts with 10,000 prime sponsors. Overall program evaluation has improved greatly but monitoring and evaluating of local performance is almost nonexistent. Budgetary processes tend to distribute funds unrelated to performance in program administration. Thus accountability suffers. The appropriations process can only be described as ridiculous.

A few governors and mayors have "grasped the nettle" and are creating their own devices for bringing their own manpower agencies under control and coordinating or consolidating their efforts. Most act as if manpower programs did not exist.

This characterization is overdrawn because it is designed to identify shortcomings and does not list strengths and notable accomplishments. The progress of eight years in the manpower policy business is still commendable. The business at hand is further improvement. The comprehensiveness endorsed by the bills under consideration will not solve the complex basic problems of personal deficiencies. locational obstacles, educational shortcomings, discrimination and the lack of enough decent jobs at adequate pay. They can tidy up program administration, increase flexibility and adaptability and add to accountability.

THE APPLICABILITY OF THE LEGISLATIVE PROPOSALS

As a member of the National Manpower Policy Task Force, I endorse in general terms the position paper we issued last week entitled, "Improving the Nation's Manpower Efforts." I wish only to emphasize and add a few points relative to the above analysis.

The need to decategorize programs, I consider unchallengeable the bills are deficient only in that they encompass only MDTA and the Economic Opportunity Act. The same logic would add WIN, Vocational Rehabilitation and establish ties with Vocational Education for the disadvantaged. The main obstacles are committee jurisdiction and the provisions of the bills giving primacy to the Labor Department. The broader consideration is precluded for the moment. A comprehensive manpower delivery system at the local level which includes these budgets and services as well should be recognized as desirable.

There is no good answer to the relative federal, state and local roles in the delivery of service. The current contract negotiating and administering responsibility is beyond federal capability. States could be effective agencies for decentralization but only if they have the commitment and the staff. Staff can be trained. Real commitment requires conversion; a reasonable equivalent can be bought, but only with a forceful monitoring presence. Labor markets overlap political jurisdictions and no meaningful metropolitan government exists. Each bill wrestles with their problem and each reaches its own unsatisfactory cour promise.

If the administering federal agency has the courage and political backing. it can delegate to the states and still enforce accountability. There is to now no working model. Cities large enough to have Congressmen whose politic allegiance is to districts within that city will demand direct access to Washing ton. Despite "one man-one vote." many governors do not yet understand and care about urban problems. Yet every city cannot mount the staff capability for manpower planning and program administration. Every SMSA is probably still too many jurisdictions to treat individually and there should be sou Limum cut off for the pass-through.

A key concept of all three bills is to take policy-making from bureaucracies and rest it in (or impose it upon) elected chief executives. This may well be an un admitted focal point of opposition to the proposals. It has the advantage that poor service can be penalized at the ballot box-but only where the target groups have access to the ballot box. It also opens possibilities for competition and accountability. Rather than having a residual right to programs, state th local agencies must deliver or their assignment can be shifted elsewhere. In thi regard, the Administration bill makes a mistake in singling out the employme service as the key agency, if only by implication. The employment service wi undoubtedly be the key deliverer of service, but it should have to compete fo that role, not only on a state-wide basis but by city. A third potential advantag is also threatened by the language of the Administration bill. Each governo and big city mayor should be given responsibility to produce a plan and administ a comprehensive program but left to design his own administrative machiner There is no reason for national uniformity. Effectiveness rather than form is ta „objective.

The major opposition to the proposals appears to come from the educatio establishment. Their charge of a “dual education system" is unrealistic becans it ignores the facts that MDTA already exists and the bills add nothing that not already in MDTA and the Economic Opportunity Act. More basic objection is the strengthening of the Labor Department vis-a-vis HEW and of goverta | vis-a-vis state education hierarchies. The latter are desirable. The former not s The Labor Department has tended to undervalue institutional training whi HEW has not recognized sufficiently the limitations of institutional train when not tied in with job development and placement. The proposals could Strengthened objectively and politically by assurance on that point. In f with the guarantee of a stronger education role, it might be possible to w linkage with vocational education and vocational rehabilitation.

None of the bills give sufficient explicit recognition to the roles of staff the ing, research, experiment and demonstration and evaluation. Budgetary tices should be addressed more specifically. Two year funding is essential so is a larger total appropriation. A public service employment provision been recognized for several years as one of the gaping holes in the packaz

manpower services. The 10 percent automatic increase in manpower funds as an automatic stabilizer would be helpful but very small. If 10 percent is good, why is not 25 percent better? Shouldn't the amount rise as unemployment rises, as it will, above 4.5 percent?

The three bills before this subcommittee are addressed to an important need. It is rare to be able to say of a number of proposals that any one would be an improvement. All three have strengths which could be merged into a major contribution to the long-range development of manpower policy.

Dr. MANGUM. There is certainly nothing about this business that I can tell you that you don't know about, Mr. Chairman, but I will make a few introductory remarks. Then I would like to be at your service to the extent that I can answer any questions.

The situation before the subcommittee is rather unique in that there are three pieces of legislation involved, any one of which would make a notable improvement in the system of delivery for manpower services. Yet, no one of these meets all of the needs and the problems.

This doesn't mean that the administration of manpower programs in such bad shape that any change would be an improvement. It just means that people in Congress and in the administrative offices who are very knowledgeable about the needs in manpower programs have thought very carefully through those needs and have come up with some very closely related recommendations. They would not serve as panaceas but would make an important improvement in the way we administer the programs and in the way we deliver manpower services. For about 8 years we have been experimenting in an area where we never had any experience before, where we were really identifying a new set of problems for a population that had formerly been neglected.

We are now at a stage where the need is to identify the lessons that have been learned over the years and to consolidate those gains. One of the most important of those lessons has been the identification of a series of service functions that seemed to be necessary for various members of the target groups, no one of whom needs all of the services. We have to find some way of delivering this set of fairly

well-known functions.

I will mention something about some of the functions, something about some of the programs, and something about some of the agencies involved at the State and local level, and then summarize some of these problems.

It seems to me that out of this experience we come up with two really critical manpower service functions, the one being the provision of skills, both remedial education and skill training, and the other job development. In program terms, that means the most important of all of the programs have been MDTA and NAB-JOBS. Each has made great contributions, but both have very serious problems.

The original assumption in the manpower programs was that the primary deficiency was within the individual, that if the individual would be provided with skills he could find himself a job. This turned out to be true for those people who were located where jobs were, but for many people in the central city ghettos and in depressed rural areas, it turned out not to be true. You could provide them with a skill, but what you were providing them with all too often was a hunting license to look for a job that did not exist.

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