Daily Labor Report®

Trump Proposal Rolls Out Four Labor, Education Subagencies (1)

June 21, 2018, 5:29 PMUpdated: June 21, 2018, 5:58 PM

The White House unveiled a proposal to combine the Labor and Education departments into a single agency with four subgroups, blending everything from enforcement to workforce development.

The June 21 reorganization report calls for the two departments’ sprawling assortment of subdivisions to be folded into agencies called K-12; the American Workforce and Higher Education Administration (AWHE); Enforcement; and the Research, Evaluation, and Administration agency.

The new Cabinet agency would be called the Department of Education and the Workforce. The reorganization plan also would shift the Bureau of Labor Statistics from the DOL to the Commerce Department.

The proposal requires congressional approval, meaning it faces a steep uphill climb in the House and Senate chambers that have rejected initiatives from previous administrations to restructure the government. The merger is an effort to fulfill promises from President Donald Trump and Office of Management and Budget Director Mick Mulvaney to eliminate federal waste and ensure bureaucratic efficiency.

The new AWHE would be focused on higher education, disability employment, adult workforce development, youth workforce development, and veterans employment. The enforcement agency would be composed of the Labor Department’s seven worker protection agencies—including the Wage and Hour Division and Occupational Health and Safety Administration—and the DOL’s International Labor Affairs Bureau and the Education Department’s Office of Civil Rights.

“Merging ED and DOL would allow the Federal Government to address the educational and skill needs of American students and workers in a coordinated way, eliminating duplication of effort between the two agencies and maximizing the effectiveness of skill-building efforts,” the administration states in the report.

Worker advocacy groups such as the National Employment Law Project were quick to criticize the reasoning behind the proposal. “The two agencies have entirely different missions and little overlap so the supposed opportunities for streamlining are scant,” Christine Owens, NELP’s executive director, said in a prepared statement.

Mixed Reaction on Hill

The head of the House Education and the Workforce Committee, Rep. Virginia Foxx (R-N.C.), praised the proposed change.

“The federal government is long overdue for a serious overhaul,” she said in a statement. “The proposed Department of Education and the Workforce is recognition of the clear relationship between education policy at every level and the needs of the growing American workforce.”

Foxx’s GOP counterpart atop the Senate Health, Education, Labor and Pensions Committee was more reserved in his reaction.

“I think it’s always wise to look for greater efficiency in how our government operates and will study the proposal carefully,” Sen. Lamar Alexander (R-Tenn.) said in a statement.

The ranking Democrat on the panel, Sen. Patty Murray (D-Wash.), referred to the proposal as the Trump administration’s “latest attempt to make government work worse for the people it serves.”

Not a ‘Fly by Night Effort’

Even though the initiative very well might fail to advance in Congress, proponents were still pleased that the administration was drawing attention to the interagency silos. For instance, Mason Bishop, the Employment and Training Administration’s deputy assistant secretary for much of the George W. Bush presidency, told Bloomberg Law that the proposal is not “a fly by night effort.”

“I give a lot of kudos to the Trump administration for at least putting it out there, because we cannot continue to operate a status quo over the next decade,” said Bishop, who was once on track to serve as the ETA’s top official under Trump before the White House changed directions on the nomination. “I think it’s very important that they do raise these issues and at least maybe create a debate and discussion around it.”

Bishop said that the current system, in which DOL and Education Department administer separate funding streams to local one-stop career development centers, leads to inefficiency and redundancy. He’d welcome a realignment, particularly to improve the implementation of the Workforce Innovation and Opportunity Act. The two agencies have already been teaming up since the 2014 passage of the law, which funds 33 job training programs across the country for adults, youth, and dislocated workers but has been troubled by operating challenges.

Eric Seleznow, who was the acting head of the ETA in the Obama administration, said more partnering between Education and Labor could be achieved without the drastic measure called for by the OMB.

“I think there’s a need for greater collaboration; I don’t think there’s any need for consolidation or cutting,” said Seleznow, who is now a senior adviser at Jobs for the Future. “Major consolidations and major reorganizations are exceptionally costly. And sometimes, the juice isn’t worth the squeeze.”

Paige Shevlin, an adviser to the Obama White House on workforce policy, agreed that increased spending will be necessary for the Trump administration to see the desired results.

The main point of consolidations from my view is to then scale programs further and make those more effective,” Shevlin said. “Without an increase in funding, it doesn’t seem like it’s about a meaningful desire to improve education or workforce policy.”

Former Education Department officials also questioned if completely combining the departments was the most effective way to improve the federal role in skills and workforce training.

James Kvaal, who served as both the Education deputy undersecretary and a policy director during the Obama administration, said if the Trump administration’s goal is to streamline the higher education and workforce development programs, there are better ways to do it.

“This plan is unnecessarily far-reaching, disruptive, and expensive,” Kvaal told Bloomberg Government in an email. “If you started with the question, how can we improve career education, this is not the plan would you end up with.”

While there is some overlap, the Education and Labor departments have separate responsibilities independent of each other, said Clare McCann, a former senior policy adviser for the Education Department during the Obama administration.

Free Market Groups Not Pleased

The plan has critics among more conservative groups that feel the plan doesn’t do enough to limit the Education Department. No programs appear to even be on the chopping block, said Lindsey Burke, director for the Center of Education Policy with the conservative Heritage Foundation.

“We need to downsize, dramatically, the current structure of the Department of Education,” Burke told Bloomberg Government. “I just worry we’ll be adding new labor programs over at ED and growing the department, which moves in the wrong direction.”

Neal McCluskey, director of the Center for Educational Freedom at the libertarian Cato Institute, said the administration’s proposal would slightly reduce the power of education interests in the administration but otherwise didn’t appear to do much.

It won’t “end, or even greatly diminish, the amount of federal intervention in education,” McCluskey told Bloomberg Government.

Student Aid Updates

The plans also reference previously announced updates to the Federal Student Aid office, such as creating an app that would allow borrowers to manage and repay their student loans. The Education Department plans for tool to be used not only when students are applying to college, but throughout their lives.

The department is in the process of soliciting companies to build the new system, opening the bidding process in February.

“While Federal student loans are uniquely complex, the Department believes that leveraging modern commercial engagement and technical capabilities is likely to reduce FSA’s operating costs over the long-term, once the solution is fully implemented,” according to the report.

(Updated with additional reporting throughout. )

To contact the reporters on this story: Ben Penn in Washington at bpenn@bloomberglaw.com; Emily Wilkins in Washington at ewilkins@bgov.com

To contact the editor responsible for this story: Chris Opfer at copfer@bloomberglaw.com

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