BUSINESS

Increase in imports force laid-off workers to retrain

Fatima Hussein
fhussein@enquirer.com

Ray Rogg worked more than 25 years at TMK Ipsco's Wilder steel mill before being laid off this winter, along with 126 other people. Some of the workers let go had up to 15 years more seniority than Rogg.

The layoffs came after the company filed federal notices to more than 300 other workers last June. While temporary, there is no set time for the workers to return.

Rogg is one of the dozens of laid-off TMK Ipsco workers who were recently approved for a U.S. Department of Labor grant meant to retrain laid-off employees after their industry moved overseas. The group will begin classes at Gateway Community & Technical College in Florence this month.

Rogg, 54, is the president of United Steelworkers Local 1870. The Erlanger resident has 12 grandchildren to help support, so he says he is now considering going back to school to retrain for an entirely new industry.

"I might do electrical, or plumbing," Rogg said, "or maybe HR since I have experience in negotiating as a union head."

What led to the layoffs at the steel mill

Both company and union officials blame recent trade agreements for the layoffs, specifically the Trans-Pacific Partnership Agreement that was signed in New Zealand this week. Even though Congress has yet to approve the plan, the company and the union charge the deal has allowed the import of cheaper steel from China and South Korea.

Simultaneous to the conclusion of negotiations for the trade agreement last October, workers from TMK Ipsco were approved to receive benefits through the U.S. Department of Labor for Trade Adjustment Assistance (TAA) funds.

TAA is a federal program created in 2009 as part of the Obama administration's stimulus package. It's designed to reduce the impact of imports on certain sectors of the U.S. economy. Benefits can include more than two years of unemployment benefits and free training for certain skilled trades.

Rapid re-employment of skilled laid off workers is the program's goal, according to Jason Ashbrook, director of the Kentucky Career Center for the Northern Kentucky Area Development District.

Yet critics of the trade adjustment assistance program say there's a lack of evidence as to whether the program is successful. Some go so far to say the program hurts workers who receive its benefits and wastes taxpayer funds.

Helping the displaced or cushioning older workers?

According to a 2012 report by the Government Accountability Office, more than 107,000 TAA participants received benefits and services under the 2009 law, a but little is yet known about their employment outcomes.

David Muhlhausen, a researcher on empirical policy analysis at The Heritage Foundation, a conservative think tank, says the TAA program is ineffective and harmful.

"In net present-value terms, the typical trade assistance participant experienced $26,837 lower total earnings and income despite receiving federal benefits," he wrote in a June 2015 article for The Daily Signal, the multimedia news organization of the foundation. He added that only 37 percent of participants who received job training found employment in the occupations for which they trained.

"The most recent federal evaluation finds that participation in the program hurts displaced workers," Muhlhausen wrote.

Rogg, who helped handle TMK Ipsco's petition to the Labor Department for Trade Adjustment Assistance, said the funds will be a big help to the laid off workers. "Some of these guys have been working here for more than 40 years," Rogg said, "it's going to be an adjustment."

Area labor leaders applaud the program as a life raft to older individuals who need more extensive assistance in finding new work.

"I think the TAA is a fantastic program," the career center's Ashbrook said. He said the extension of unemployment benefits and paid training provide a cushion for people who may have skills that are no longer useful in the current job market.

Ashbrook said over the past five years, roughly 300 workers have been retrained due to outsourcing.

What the program costs in Greater Cincinnati

Moira Weir, director of Hamilton County's Job and Family Services, said the $886,426 from TAA that was spent in 2015 by OhioMeansJobs Cincinnati/Hamilton County had a sole purpose: Finding work for displaced employees.

"In almost all cases, we will not fund training unless it is likely to lead to a full-time job in a growing industry with existing vacancies that pay more than $13 per hour," Weir said in an email to The Enquirer.

More than $482,159 came from a series of grants issued by the state to let dislocated workers pursue training to be truck drivers, or to gain in-demand administrative/office skills.

Weir said the money was spent locally in two ways. "Most were spent on tuition at one of a dozen Greater Cincinnati and Northern Kentucky training institutions for a professional certification with a training time of less than one year." The remainder offset the costs incurred by local employers to provide on-the-job training.

However, some have questioned the need for certain skilled workers to receive greater unemployment and training benefits when hundreds of thousands of workers are laid off every year. While marginal National Dislocated Worker Grants have recently been awarded to coal miners, former military members and Silicon Valley tech workers, the bulk of TAA is awarded to manufacturing workers.

James Brock, an economics professor at Miami University said the argument boils down to the differences in trade.

"This is a deliberate government policy that the government has changed," Brock said. "When it comes to technology it's not a matter of deliberate man-made policy rather an evolution of industry.

He said it would take political lobbying power to call for increased benefits for workers who are routinely laid off due to economic changes.

"There is a question there, why shouldn't people be paid additional benefits when their jobs are phased out? I don't know."

Some members of Congress have supported this view and spoken out against TAA and what they see as its lack of merits.

U.S. Sen. Orrin Hatch, R-Utah, called TAA a "poison pill" for taxpayers in a 2011 statement regarding its inclusion in the trans Pacific trade deal.

"Including a domestic spending program of dubious merit is bad policy.... I hope we can find a better path forward and the president will now act quickly and submit these agreements for congressional consideration, without including the TAA," he said.

Rogg hopes that conditions in the oil and gas exploration industry will improve so he can return to his job at TMK Ipsco.

"We've all been through layoffs here before, and been brought back, but it's looking pretty bad now," he said. "Starting over is scary."