DEED programs need some work

State workforce programs help Minnesotans find jobs, but are plagued by problems with accountability and coordination, members of a House division learned.

A new report from the Office of the Legislative Auditor highlights administrative problems within the Department of Employment and Economic Development. Legislative Auditor James Nobles presented the report and its findings to the House Bioscience and Workforce Development Policy and Oversight Division on Feb. 17. No action was taken.

The report finds that unemployed Minnesotans who utilize the state’s workforce centers are generally more likely to find employment than those who don’t; however, the complex web of workforce programs in the state is difficult to accurately monitor for performance.

“These are programs that are always very important to people who are looking for work or looking to change jobs,” Nobles said, adding that workforce programs “need to be effective,” especially at a time of high unemployment.

Key findings in the report include:

• accountability within DEED is diffuse due to fragmented authority and funding;

• workforce programs are only partially integrated with related programs like unemployment insurance and adult basic education;

• funding for program providers bypasses a competitive selection process; and

• DEED’s monitoring of program providers is inconsistent and not well funded.

Jody Hauer, OLA program evaluator manager, said another problem is that workforce program funding is tied to flawed federal performance standards. This gives workforce program providers an incentive to work with people who are most likely to succeed in finding jobs, rather than those who need the most help.

“The workforce program receives no additional credit when a person who has limited schooling gets a job, than when a skilled tradesperson comes in with an AA degree and gets a job,” Hauer said.

Among other problems, Hauer also said DEED does an inadequate job of providing face-to-face help for people who want to apply for unemployment insurance benefits, directing them instead to a central phone service or to DEED’s Web site.

Rep. Tim Mahoney (DFL-St. Paul), the division chairman, said the system is “bent in ways that it shouldn’t have been bent,” but “it’s not broken.” He said additional hearings are planned on the topic, possibly as early as Feb. 23.