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ERIC Number: ED328787
Record Type: Non-Journal
Publication Date: 1987-Feb
Pages: 14
Abstractor: N/A
Reference Count: N/A
Trade Adjustment Assistance: Part of the Solution, or Part of the Problem? Monograph Series Vol. 1, No. 1.
Baldwin, Stephen E.
Trade Adjustment Assistance (TAA) is a benefit paid to workers who lose their jobs in industries that face increasing competition from imported goods. TAA is supposed to offset political pressures for protectionist legislation, and it has been justified on grounds of equity and efficiency as well. Research on TAA shows that it has failed to aid many workers in adjusting to job losses in industries hurt by imports. More than 97 percent of the $4 billion spent on TAA from 1962 to 1986 went to pay cash benefits to workers unemployed from trade-affected firms. Retraining and relocation assistance accounted for less than 3 percent of TAA spending. The research suggests that TAA recipients had longer durations of unemployment than did comparable nonrecipients. A serious flaw in the system is that there are long administrative delays in certifying a firm or industry for benefits. Some researchers have suggested that paying benefits in a lump sum rather than weekly would increase the chance that a worker would seek employment or training. However, it must be considered that there may be no other jobs available that pay as well, so employees prefer to wait and hope for recall. Taking new jobs may be made more attractive by providing wage subsidies or reemployment bonuses. Recent changes in the program have increased emphasis on job search and retraining. (KC)
National Commission for Employment Policy, Public Affairs Office, 1522 K Street, Suite 300, Washington, DC 20005.
Publication Type: Opinion Papers
Education Level: N/A
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: National Commission for Employment Policy (DOL), Washington, DC.