The Clinton-Kaine Job Replacement Plan

Even before her infamous gaffe in March about putting coal miners out of business, Democrat Hillary Clinton was aware of the economic disruption those workers are facing.

Her solution, laid out in a policy in November, promises to make America a green energy “superpower” that will both produce high-paying jobs and save the environment: “Building a 21st century clean energy economy in the United States will create new jobs and industries, deliver important health benefits, and reduce carbon pollution.”

“Job retraining has proven to be a failure over the last two decades.”

Left unsaid is the obvious difficulty of putting displaced coal miners in places like West Virginia and Kentucky in a position to compete for jobs that likely will not exist within hundreds of miles of their homes. Similar challenges exist for former factory workers who lose high-paying jobs as America’s industrial sector contracts.

“Job retraining has proven to be a failure over the last two decades,” said Kevin Kearns, president of the U.S. Business and Industry Council. “The record is pretty clear … We’re creating a lot of [false] hope where hope doesn’t exist.”

Clinton and running mate Tim Kaine wrapped up a three-day bus tour of Ohio and Pennsylvania on Monday to highlight their jobs plan in working-class areas targeted by Republican Donald Trump. The Trump campaign hammered the Democratic ticket Monday on the Obama administration’s jobs record, pointing to data showing that poverty rose while incomes fell in both states between 2008 and 2014.

Kearns said America would be better off spending money defending its industrial base from the threats of foreign trade cheaters than teaching workers to do other jobs. He said many job-training programs take place in community colleges that vary in quality from state to state.

“You’re kind of guessing what’s going to be available. And that’s hard to do,” he said. “Essentially, you’re asking community college officials to tell you what the marketplace is going to be like in two years.”

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The federal government spent nearly $2 billion on adult and dislocated worker programs in fiscal year 2013 alone, according to the General Accountability Office. Yet, the data that the Labor Department gathers from states that run the programs is “inconsistent and complete,” according to a December 2013 GAO report.

A Heritage Foundation report last year on the effectiveness of the Trade Adjustment Act suggested that federally funded job retraining is worse than useless — it may actually harm displaced workers. The analysis cited a 2012 study by Mathematica that found that only 37 percent of displaced manufacturing workers who received job training from the program found employment in the occupations for which they trained.

[lz_table title=”Job-Retraining Failure?” source=”Heritage Foundation/Mathematica”]Laid-off manufacturing workers
| Average weeks worked,Got training,Didn’t get training
Year 1,6,25.5
Year 2,18.9,37.8
Year 3,28.1,37.1
Year 4,33,35
| Average earnings,Got training,Didn’t get training
Year 1,$3.1K,$15.7
Year 2,$9.6K,$22.6K
Year 3,$13.6K,$21.0K
Year 4,$15.9K,$19.2K
All 4 years,$42.9K,$80.1K
[/lz_table]

Participants also worked fewer hours and earned less money than comparably displaced manufacturing employers who did not participate.

David Muhlhausen, a research fellow at The Heritage Foundation and one of the authors of the 2015 analysis, said a number of academic studies suggest that the programs do not have a very good record matching displaced manufacturing workers with new jobs that pay as well as their previous jobs.

“There isn’t a lot of hope that they help the people they’re designed to help,” he said. “The training provided isn’t what employers need … They [the programs] may be steering people toward training that they don’t need.”

Peter Navarro, an economics and public policy professor at the University of California, Irvine, called job-retraining programs a “cruel joke” on American workers.

“The problem we have is there’s a fundamental mismatch of skills Americans have an opportunities,” he said. “You can retrain these people all you want. But if there are no jobs for them, what’s the point?”

“You can retrain these people all you want. But if there are no jobs for them, what’s the point?”

Muhlhausen said participation in job training programs can actually hurt employment prospects because participation allows people to extend unemployment benefits. But while participants often do not actually improve their marketability, they harm their employment prospects by increasing their time out of the labor force.

Job retraining tends to be popular with politicians, Muhlhausen said, but he added that it often amounts to little more than a public relations sop.

“They’re offering a program that doesn’t really offer a solution,” he said.

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Alan Tonelson, an economic policy analyst who is critical of America’s trade politics, said new jobs of displaced factory workers simply do not pay as well.  “Even the best of these programs are no solutions for these relatively high-paying industries that have been lost,” he said.

Muhlhausen said research by one of his Heritage Foundation colleagues suggests skills taught by programs geared toward the high-tech “green energy” jobs of the future often amount to using a caulking gun.

“A lot of these high-tech, green jobs aren’t actually all that high-tech,” he said.