Dislocated Workers

The expansion of Redwood National Park in 1978 put many timber workers in Northern California out of work. As a result, the federal government created programs to help alleviate the effects of the park expansion on workers and their towns. Now 15 years later, new environmental concerns have again placed restrictions on the timber industry, and the President has proposed new assistance programs for dislocated timber workers. GAO revisited the Redwood worker assistance programs and found that, although they were quite extensive, few workers actually enrolled in retraining programs. Many workers received wage replacement benefits or severance payments--some received as much as $45,000--but this money was not tied to retraining. In addition, because Labor Department regulations for retraining were delayed until 14 months after program implementation, educational service providers were reluctant to develop retraining programs, and officials lost contact with many of the dislocated workers before they could be retrained. Per capita income dropped steeply in the two counties affected by the park expansion, and housing values fluctuated. In one county, an influx of retirees helped to stabilize property values and retail sales, while in the other county construction of a state prison produced about 1,800 jobs.

GAO found that: (1) the assistance program has provided wage replacement benefits or severance payments totalling about $104 million to 3,500 individuals; (2) few dislocated workers have enrolled in retraining programs because monetary benefits are not tied to retraining and program implementation has been delayed 14 months; (3) about 95 percent of the enrollees have completed their retraining and 25 percent of them have been relocated; (4) it could not determine what happened to individuals after receiving benefits or retraining because program records are no longer available; (5) per capita income has dropped dramatically and average new housing values have fluctuated in both affected counties due to implementation of the assistance program; and (6) future assistance programs for dislocated timber workers should closely tie benefits to participation in retraining programs, create new job opportunities in the affected communities, and help dislocated workers at the time of job loss to increase participation in assistance programs.