NSC releases FY 2013 budget analysis.

February 16, 2012

On February 13, President Obama submitted his Fiscal Year (FY) 2013 budget request to Congress, providing the Administration’s appropriations requests for federal programs and activities beginning October 1, 2012. National Skills Coalition has just released an analysis of key workforce and education programs included in the President’s request.

The FY 2013 budget request arrives at a critical time for the workforce field. Despite continued high unemployment—and clear evidence that U.S businesses are struggling to find qualified workers to sustain economic growth—Congress has cut more than $1 billion from workforce development programs over the last two appropriations cycles. With further budget reductions required as part of last summer’s debt ceiling compromise—enforced through strict caps on discretionary spending and automatic spending cuts known as “sequesters”—workforce programs likely face additional cuts in FY 2013 as Congress begins the budget and appropriations process.

Against this backdrop, the President has increasingly focused on the importance of training and education. The “American Jobs Act,” a $447 billion job creation bill proposed by the White House in September 2011, included major new investments in training to help low-skilled and long-term unemployed workers reenter the labor market. Similarly, the President’s “Blueprint for an America Built to Last”—released in conjunction with the recent State of the Union—identified a skilled workforce as one of four pillars of a strong economy, and called for a new national commitment to train two million skilled workers. The Administration’s FY 2013 budget builds on these initiatives, expanding proposals from the American Jobs Act and proposing new education and training initiatives that would provide billions of dollars in new training funding, while largely sustaining workforce existing funding streams.

Highlights of this year’s budget include:

  • $12.5 billion for a “Pathways Back to Work Fund.” Under the FY 2013 budget, the Pathways Back to Work Fund would support immediate employment and training activities for unemployed and low-income individuals. The budget calls for $10 billion in mandatory funding to support subsidized employment opportunities and “other promising strategies designed to lead to employment,” and another $2.5 billion in mandatory funding for summer and year-round youth employment programs.
  • Reemployment NOW Fund. The budget proposes a $4 billion “Reemployment NOW” fund, intended to give States the flexibility to better connect individuals experiencing long-term unemployment (i.e. Extended Unemployment Compensation (EUC) claimants) with job opportunities. In particular, States would be able to implement “Bridge to Work” programs that place long-term unemployed workers in short-term unpaid work experience with local employers (while maintaining their UI benefits); provide self-employment assistance as a reemployment strategy; or support “work sharing” programs that allow employers to reduce hours rather than lay-off workers and provide unemployment assistance to those workers who lose hours as a result.
  • Community College to Career Fund. A new Community College to Career Fund would provide a total of $8 billion over three years to support job training partnerships between states, community colleges, and businesses. Funding would be available to support job training activities aimed at filling jobs in high-growth industries, including work-based strategies like registered apprenticeship and OJT, paid internships for low-income students, and entrepreneurial training. Funds would be split evenly between DOL and the Department of Education (DOEd), with each agency receiving $1.33 billion in FY 2012-2014.

NSC looks forward to working with the Administration and Congress to support workforce policies and investments that expand access to job training and education for all U.S. workers and businesses.