Implementation of the Phaseout of CETA Public Service Jobs

GAO was asked to review and report on the Department of Labor's efforts to find permanent unsubsidized jobs or new training opportunities for individuals who lost their jobs because of the phaseout of public service employment (PSE) programs authorized under the Comprehensive Employment and Training Act (CETA).

In conjunction with the PSE phaseout, Labor took action to maximize the assistance available to move participants into unsubsidized employment or further training. The reemployment effort was given top priority for the entire employment and training system. GAO found that 44.9 percent of the former PSE participants were employed, 5.5 percent returned to school or entered other training programs, and 49.6 percent were unemployed. Employment varied among the prime sponsors. Temporary jobs were held by 23.9 percent of the employed, and 20.9 percent had part-time jobs. About 61 percent were earning more than their PSE wage, about 25 percent were earning less, and the other 14 percent were earning the same amount. Slightly more than half of the unemployed were receiving one or more forms of public assistance. On the average, these individuals were receiving about $300 per month, or $353 less than their former PSE salary. Individuals who had been laid off less than 3 months were not receiving assistance as often as those who had been out of work for a longer period. Two or more attempts to find work each week were made by 77 percent of the unemployed. Age, sex, education, CETA title, economic status, and length of participation were not significantly associated with an individual's employment status. Statistics showed that 46 percent of the participants received some help from their prime sponsors, 39 percent were helped by local employment services, and 16 percent received some help from private industry councils.