The last act of the 116th Congress leaves holes in workforce funding the 117th must fill

By Katie Spiker, February 10, 2021

The 116th Congress finished their work by passing a combined annual spending and stimulus agreement just before the new year. Legislators did include slight funding increases for skills programs in the legislation. Unfortunately, Congress continued their failure to invest in workforce funding that workers and businesses need to ensure an inclusive economic recovery.

This failure will mean workers who have lost their jobs will not have access to training and supports they need to reenter the workforce. Likewise, businesses will be unable to meet demand once the economy fully reopens.


Why workforce investments matter

For context: more than fifty million Americans – almost 30% of the workforce – have filed for unemployment because of the pandemic. More than ten million were still unemployed at the end of 2020. More than 40% of that job loss affects workers earning less than $40,000 per year. Workers with a high school degree or less have lost their job three times as often as those with a bachelor’s degree. And workers of color – especially women of color – have been disproportionately impacted by both the health and economic crisis.

For these workers, training and education will be critical to their ability to reenter industries that are hiring. For example, workers with some postsecondary education filled 99% of the jobs created after the Great Recession.

Applying that same standard to today, it means that without investments in training, Congress is telling 20 million Americans that their economic recovery does not matter.

We can’t train our way out of the current crisis, but these investments are a big part of the solution.


What was included in the bill – and why it’s not enough

Stimulus Components – supplemental funding

In addition to annual appropriations, the year-end deal includes $900 billion in stimulus funding, intending to address the current crisis.

The stimulus provisions include no targeted funding for skills. However, for states or localities with remaining funding from previous stimulus bills, the deadline for spending these funds was extended from December 30, 2020, to December 31, 2021. This includes the $345 million in funding for grants under the Dislocated Worker National Reserve.

The bill does include $22.7 billion in dedicated funding for an “Education Stabilization Fund.” This reups a funding stream from previous stimulus legislation. Funding can be used to support institutional costs or as emergency grants to students. Grants can cover the costs of food, housing, course materials, or health and childcare. This latest iteration of the Education Stabilization Fund includes several updates to how the funding can be spent, consistent with NSC recommendations.

The bill’s stimulus provisions also include $3.2 billion in Emergency Broadband benefits. This program will reimburse internet service providers supplying service and devices to low-income households.


Permanent Policy Changes

The year end package also included updates and extensions of several key programs that workers and businesses rely on.

  • Continuing funding and extending Temporary Assistance for Needy Families (TANF). The extension of TANF in its current structure adds stability for state spending and programs. TANF, however, has not been updated since 2005. The current structure restricts workers access to basic assistance and skills training programs.
  • Simplifying application and eligibility for federal student aid through Pell grants. The legislation also amends the Higher Education Act to significantly simplify the process by which students apply – and are eligible – for federal student aid.
  • Removing restrictions on incarcerated students accessing federal student aid. The 1994 crime bill prohibited incarcerated individuals from accessing Pell grants. The year-end spending bill restores Pell Grant eligibility for these students.


Annual Appropriations

The bill includes slight funding increases for skills programs. The overwhelming demand to reskilling and upskilling in the current crisis makes these increases critical. But investments in skills training have been cut by nearly 40% over the last two decades. Our current investments in unemployment and reemployment programs only enable about 5% of all workers who lose their jobs to access these comprehensive services.

There will be many more people who need training than there are resources to train them. Our workforce and education systems are intended to connect workers to skills training that leads to good jobs. We need significant investments today to make that possible.


What we didn’t see in the year-end spending and stimulus bill

Since the beginning of the pandemic, NSC has consistently called for investments in four areas as part of stimulus and recovery advocacy:

  1. Workforce development as part of a people-centered infrastructure plan.
  2. Workers who lost their jobs, to ensure they can reskill and upskill.
  3. Workers most vulnerable to losing their jobs, including digital literacy skills.
  4. Partnerships between educators and businesses.

The 116th Congress failed to provide the funding necessary to meet these worker and business needs in their final act.

NSC is calling on our partners across the country to add your voice to advocacy for investments in skills. With the 117th Congress now in full swing, there’s no better time to ensure policymakers have skills on their agenda.