New Federal Workforce Law Enacted

Earlier this summer, a new federal workforce law was enacted. The new law, entitled the Workforce Innovation and Opportunity Act (WIOA), replaces the Workforce Investment Act and reauthorizes federal workforce and training programs. The law received bi-partisan support in both the House and Senate and passed both with large majorities.

WIOA represents the first update of federal workforce programs since 1998. The law aims to modernize and improve existing federal workforce development programs and emphasizes an increased responsiveness to the needs of businesses. The basis of the law challenges local workforce areas to design program which will grow businesses, job and wages.

The law preserves local authority in workforce investment boards and workforce investment areas. It also provides greater local board flexibility to address their workforce challenges, such as allowing them to use up to 20 percent of adult workforce funding for incumbent worker training and on the job training reimbursement up to 75% for in-demand occupations. This flexibility will allow local boards to tailor plans and services to meet the needs of local jobseekers and employers. Other types of training allowed under the law include entrepreneurial, internships, work-based and work experience leading to a career. Heavy emphasis is placed on career pathways.

WIOA reduces the minimum number of required members (from 51 to 19) for the local workforce boards but still maintains a business-led majority. This will increase the efficiency and effectiveness of local boards and further productive relationships with businesses.

A strong workforce system will increase investments and resources for quality training and help to ensure that localities and states can craft a skilled local workforce with the education, skills, and credentials needed by local employers. The new law provides a more efficient framework for a modernized workforce development system by maintaining the local role in the system with added flexibility. It recognizes that local elected officials and boards play a critical role in workforce development and the overall economic health of local communities.

The WIOA will be phased in over the next two years as the US Department of Labor works to provide further regulations and guidance.

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