Department of Labor

The mission of the Department of Labor, which has a budget of $34 billion and 16,000 staff in fiscal year 1997, is to promote the welfare of U.S. wage earners, improve their working conditions, and advance opportunities for profitable employment. In recent years, the U.S. work environment has changed, making these goals more difficult to achieve. Although the strength of international competition has underscored the need for a skilled U.S. labor force, many Americans remain unprepared for such employment. At the same time, major changes are occurring in employer/employee relations, such as greater use of part-time and contract workers. This testimony discusses two areas that pose significant challenges to the Department: (1) providing effective employment and training programs that meet the diverse needs of target populations in a cost-effective way and (2) ensuring worker protection within a flexible regulatory structure. GAO also discusses how improved managed envisioned by recent legislation would bolster the Department's ability to meet these challenges.

GAO noted that: (1) although Labor has historically been the focal point for workforce development activities, it faces the challenge of meeting those goals within the context of an uncoordinated system of multiple employment and training programs operated by numerous departments and agencies; (2) in fiscal year 1995, 163 federal employment training programs were spread across 15 departments and agencies (37 programs were in Labor), with a total budget of over $20.4 billion; (3) although GAO has not recounted the programs and appropriations, GAO is confident that the same problem exists; (4) rather than a coherent workforce development system, there is a patchwork of federal programs with similar goals, conflicting requirements, overlapping target populations, and questionable outcomes; (5) comprehensive legislation that would have addressed this fragmentation was considered but not passed by the 104th Congress; (6) in the absence of consolidation legislation, Labor has gone ahead with some reforms, such as planning grants for one-stop career centers, but the actions it has taken have not been enough to fix the problems; (7) passage of the recent welfare reform puts even greater demands on an employment training system that appears unprepared to respond; (8) a second major challenge for Labor is to develop regulatory strategies that ensure the well-being of the nations' workers in a less burdensome, more effective manner; (9) Labor has made some changes since GAO last testified, which are perhaps best illustrated by actions at the Occupational Safety and Health Administration (OSHA), such as its partnership initiatives with companies, but OSHA's actions have not been without controversy, and substantial challenges remain there and at other Labor components with worker protection responsibilities; (10) congressional action poses new challenges in the worker protection area as well; (11) Labor has committed to redesigning its Davis-Bacon wage determination process with additional funds appropriated by the Congress; (12) Labor also must issue and enforce regulations to implement the new health care portability law; and (13) in meeting these mission challenges, Labor will need to become more effective at managing its organization.