Employers in sectors such as manufacturing, energy and agriculture faced with significant shortages of skilled labor, received a major boost from Congress last week. The long-awaited job training program reform bill “Workforce Innovation and Opportunity Act” received bipartisan approval. President Obama has expressed support for the legislation and is expected to sign it into law later this week.

The pending legislation (known as “WIOA”) resolves an 11 year-long debate about the best way to reform Federal workforce training programs which have been widely criticized for being redundant, inflexible, and not measured by performance.  Highlights of the legislation include:

  •  Elimination of 15 existing job training programs
  • Application of a single, uniform set of accountability metrics to make job training programs more performance driven
  • Requires states to produce one strategic plan for employment related training, education, and vocational rehabilitation
  • Emphasizes access to real-world training by increasing employers’ ability to use on-the-job training and receive as much as 75% reimbursement from the federal programs
  • Allows businesses to identify the skills they need and then connect workers with the different programs designed to build those in-demand skills

The WIOA legislation repeals the Workforce Investment Act of 1998 and provides guidance to the three executive branch departments (Labor, Education, and Health and Human Services) charged with implementation of the reforms.  The legislation targets the shortfall in eligible workers with the training and skills necessary to fill current and projected job vacancies.  If the current eligible worker shortfall is not addressed, employers are projected to have as many as 11 million unfilled jobs over the next eight years.

The WIOA was approved by the U.S. House of Representatives on July 9, 2014 by a vote of 415-6.  It was approved by the Senate last month by a vote of 95-3.  The legislation received strong support from the National Association of Manufacturers and a broad coalition of employers, business advocacy groups, and labor and social service organizations.

For additional information, please contact Joe Orlet.