On July 16, 2021 Representative Adam Smith (D-Wash.) reintroduced the Emergency Economic and Workforce System Resiliency Act, which will provide new funding to state and local workforce agencies to prevent layoffs, support displaced workers, and collaborate with employers on innovative strategies for preserving the existing workforce and creating new jobs. Senator Amy Klobuchar (D-MN) will be introducing the bill in the Senate.
The USFWC is proud to support this legislation, which prioritizes workers who have been deeply impacted by the COVID-19 pandemic by supporting at-risk workers, employers, and industry through strengthening state workforce systems and industry-sector supports. The bill creates a short-term (5-year) supplemental formula funding stream to states and localities to creatively to prevent layoffs, meet the needs of displaced workers, and strengthen firm viability to preserve existing and create new jobs. This funding will help states meet the exacerbated needs
of the workforce system during the pandemic and recession:
- Uses existing Workforce Innovation and Opportunity Act (WIOA) formula mechanism and reporting framework to simplify the process for states.
- Requires states to apply for funds by submitting a state plan articulating the strategic vision for use of supplemental funds.
- Encourages states to collaborate across state agencies and with other non-profit and for-profit entities to carry out grant activities.
- Requires states to conduct employer outreach to ensure workforce development activities are linked with firms that offer high quality in-demand jobs.
- Encourages states to prioritize partnerships with firms and industry sectors that offer high quality jobs with competitive wages and benefits.
- Allows states to use funds for entrepreneurial development and coaching to build workforce capacity, establishing or augmenting the work of employee-ownership resource centers, or setting up revolving loan funds to help facilitate employee- and cooperatively-owned models as a means of retaining businesses and jobs.
The bill also provides funding for planning and implementation grants for short-term pilot program (5-years) for states to pilot innovative workforce-system-wide layoff aversion models:
- The Secretary of Labor will award both planning and implementation grants to states for the purposes of carrying out layoff-aversion and job creation models, including assisting firms in transitioning to employee ownership or worker cooperative models . States can receive up to $350,000 for a planning grant and up to $25 million in funding for implementation grants.
- These grants are intended to promote innovation at the state-level in designing workforce system-wide programs and activities to ensure workers can obtain and retain employment in
high-quality in-demand occupations and industries. Possible uses include broad-based business ownership strategies for investing in distressed businesses and for workers left out of traditional employment benefits such as gig workers, contractors, caregivers and micro-entrepreneurs.
- State pilot programs will be rigorously evaluated to determine promising practices in layoff aversion and job creation strategies, with particular emphasis on what interventions help workers weather economic disruptions.
“The COVID-19 pandemic has significantly impacted our workforce and left many workers experiencing joblessness or employment instability. These disruptions have underscored the need for an updated workforce training system that better prepares our workers for changing job markets and supports them in times of disruption. Current economic development programs, workforce training programs, and unemployment benefits programs are often siloed and focus on workers already out of work,” said Congressman Smith. “The Emergency Economic and Workforce System Resiliency Act will provide critical funding to state and local workforce agencies to prevent layoffs and support workers and firms as jobs and industries encounter transitions. Through increased resources for training, upskilling, and piloting innovative incumbent worker training models, this bill will help workers develop and stay current on the skills and credentials necessary to maintain high-quality jobs with good wages and benefits.”
“This legislation will provide resources to states and localities to help prevent layoffs, retrain employees, and protect against market disruptions,” said Senator Amy Klobuchar. “By meeting the needs of our workforce, we are investing in our economy and future generations.”
This funding will help states meet the exacerbated needs of the workforce system during the recovery from the pandemic and economic downturn, and serve as a model for future workforce disruptions from economic downturns or increased automation. The bill encourages states to collaborate across state agencies and with other non-profit and for-profit entities. States are encouraged to prioritize partnerships with firms and industries that offer high-quality, in-demand jobs with competitive wages and benefits.
The Emergency Economic and Workforce System Resiliency Act also funds five-year pilot programs for states to implement innovative workforce system-wide layoff aversion models. These grants will promote state-wide innovation to effectively support workers throughout their careers and bolster firm resiliency in the wake of economic disruption.
Endorsing Organizations: Washington State Workforce Training and Education Coordinating Board, Center for Law and Social Policy, National Cooperative Business Association, Impact Washington, National League of Cities, National Skills Coalition, Democracy At Work Institute, CooperationWorks!, ICA Group, Project Equity, Northwest Cooperative Development Center, Local Enterprise Assistance Fund, National Cooperative Business Association CLUSA International, Cooperative Fund of New England, US Federation of Worker Cooperatives, SEIU-UHW West, Cooperative Development Institute, Sustainable Economies Law Center, Employee Ownership Expansion Network, National Association of Workforce Boards