Options for states in addressing questions relating to use of the Title III dislocated worker program of the Job Training Partnership Act are discussed. Two broad subjects are emphasized: short-term actions for aiding workers and communities suffering from economic dislocation and longer-term strategies to integrate displaced worker employment and training efforts into economic policy and program planning. The macroeconomic context is discussed, and broad economic trends are related to policy decisions state planners face. Key areas in which states can exercise discretion as regards Title III are discussed, including allocating funds, defining program activities, defining the eligible population, and defining matching funds. Other resources that the state can organize as well as broker are suggested. Two categories of mitigation are discussed: assistance to workers (retraining, job searching assistance, counseling and supportive services, relocation and job development, work sharing) and assistance to communities (short-term crisis intervention, technical assistance, adapting institutions to needs). Alternatives for building dislocated worker programs into a longer-term economic development policy are examined, including improving labor market information systems, exploring comprehensive state plant closing legislation, improving overall work force quality, retaining viable firms through employee ownership, and increasing the rate of new business formation. (YLB)