Trade Adjustment Assistance for Workers (TAA)

Trade Adjustment Assistance for Workers (TAA)

Updated February 17, 2021
Trade Adjustment Assistance for Workers (TAA)
Overview and Program Rationale
 Increase in directly competitive imports. The sales or
Reduced barriers to international trade are widely
production of the petitioning firm has decreased and
acknowledged to offer net benefits by expanding market
imports of articles or services directly competitive with
access but may adversely affect domestic industries and
the petitioning firm have increased.
workers that face increased competition. Trade Adjustment
Assistance for Workers (TAA) is designed to help trade-
 Shift in production. The workers’ firm has shifted the
affected workers adjust to job loss resulting from increased
production of articles or supply of services that were
foreign competition. The primary benefits under TAA are
produced or supplied by the petitioning workers to a
funding for retraining and weekly income support payments
foreign country, or the workers’ firm has begun to
while affected workers are enrolled in training.
acquire from a foreign country articles or services that
are directly competitive with those produced by the
Trade Adjustment Assistance
workers.
Reauthorization Act of 2015
In June 2015, Congress enacted the Trade Adjustment
 Qualified secondary firm. The workers’ firm is a
Assistance Reauthorization Act of 2015 (TAARA; Title IV
supplier or downstream producer to a firm that was
of P.L. 114-27). This law established a set of TAA
certified under either of the prior two criteria, and the
eligibility and benefit provisions that are currently in effect
secondary firm meets certain other criteria.
and set to remain in place through June 30, 2021. TAARA
further established sunset provisions that will take effect
 USITC firm. The workers’ firm is publicly identified
July 1, 2021. At that time, the program will revert to a more
by name by the United States International Trade
restrictive set of eligibility and benefit provisions for new
Commission as injured by a market disruption or other
program participants.
qualified action.
This product focuses on the TAA program under current
If DOL’s investigation finds that the cause of the workers’
law and touches on some major aspects of the sunset
dislocations meets the statutory criteria, the workers’
provisions. For a more detailed discussion of the sunset
petition is certified. Workers covered by a certified group
provisions, see CRS Report R44153, Trade Adjustment
petition can then pursue individual benefits.
Assistance for Work ers and the TAA Reauthorization Act of
2015.
Under the provisions scheduled to take effect July 1, 2021,
eligibility will be reduced. Among other changes, eligibility
Program Administration
will be limited to production workers. Service workers will
TAA is administered jointly by the U.S. Department of
no longer be eligible for new certifications.
Labor (DOL) and cooperating state agencies. DOL is
responsible for investigating group petitions to establish
Training and Reemployment Services
program eligibility. State agencies are responsible for
Workers covered by a certified TAA petition are entitled to
administering federally-funded benefits to eligible workers.
certain benefits and services to aid them in preparing for
and obtaining new employment. As noted above, training
Funding and FY2021 Appropriations
and reemployment services are administered through state
Appropriations for TAA in FY2021 were $633.6 million.
workforce agencies.
TAA is nonexempt mandatory (direct) spending, which
means it is subject to sequestration under the Budget
Case management and career services are typically
Control Act. In FY2021, sequestration for nonexempt,
provided by staff at state-run American Job Centers (also
nondefense spending was 5.7%, meaning that the post-
known as One-Stop Career Centers). Statute specifies a
sequestration funding level was about $597.5 million.
group of services that all TAA-certified workers shall
receive, including a comprehensive skills assessment and
Eligibility and Group Application Process the development of an individual plan to identify an
To be eligible for TAA benefits, an individual worker must
employment objective and training to achieve that
be part of a group of TAA-certified workers. To obtain
objective.
group certification, a group of dislocated workers files a
petition with DOL that describes how foreign trade
Training benefits can be paid directly to a training provider
contributed to the workers’ job losses. DOL then conducts
or through a voucher system. Statute establishes a set of
an investigation to determine if the circumstances of the
conditions under which training shall be approved: there is
workers’ job losses meet program eligibility criteria.
no suitable employment available for the worker, the
Qualified circumstances of job loss are the following:
training is available at a reasonable cost, the worker is
qualified to undertake the training, and there is a reasonable
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Trade Adjustment Assistance for Workers (TAA)
expectation of employment after the completion of the
Health Coverage Tax Credit (HCTC)
training.
The HCTC provides a subsidy for qualified health
insurance premiums for TAA workers. The HCTC equals
Funding for training and reemployment services is granted
72.5% of qualified health insurance costs. To qualify for the
from the federal DOL to state agencies using a formula that
HCTC, the worker must be receiving TRA, UI in lieu of
considers the state’s past and anticipated usage of TAA. A
TRA, or RTAA.
portion of funding is withheld from the initial formula
distribution and states may apply for these reserve funds.
Issues for Congress
Equity among dislocated workers. TAA provides a set of
Under current law, the statutory cap for training and
benefits and services that, in many cases, are more robust
reemployment services is $450 million. Beginning July 1,
than those available to workers who involuntarily lose their
2021, the funding structure for these services will change.
jobs for nontrade reasons. Some opponents of TAA suggest
The cap will be limited to training and reduced to $220
trade-affected workers should not receive special treatment
million.
and trade-affected workers should instead utilize the
benefits and services that are available to all dislocated
Income Support: Trade Readjustment
workers. Supporters of TAA note that, due to the
Allowance (TRA)
congressional role in approving trade agreements, trade-
TRA is a weekly payment that works in conjunction with
based dislocation may have a more direct relationship to
unemployment insurance (UI) to provide a TAA-certified
congressional action than other forms of job loss, and
worker with income while the worker is enrolled in
therefore a specialized program is warranted.
training. TRA begins the week after a worker exhausts his
or her UI. A worker’s weekly TRA benefit equals his or her
The relationship between TAA and expansionary trade
final weekly UI payment. There are three stages of TRA
policy. Historically, TAA has been reauthorized and
that, when combined with UI, offer a maximum of 130
expanded alongside policies that relate to expansionary
weeks of benefits.
trade policy. For example, TAARA was enacted in 2015 in
conjunction with the Trade Promotion Authority, which
 Basic TRA begins the week after a worker exhausts UI.
granted the President the authority to negotiate trade
A worker may collect UI and Basic TRA for a combined
agreements that would be subject to an “up or down” vote
total of 52 weeks. In limited cases, a worker may be able
in Congress. Some Members may consider expansionary
to obtain a training waiver and collect Basic TRA
trade policy more appealing if it is accompanied by TAA
without enrolling in training.
legislation.
 Additional TRA begins the week after a worker exhausts Other TAA Programs
Basic TRA. A worker may collect Additional TRA for
This product discussed the TAA for Workers program. In
up to 65 weeks. Only workers enrolled in training may
addition to the program for workers, statute also authorizes
collect Additional TRA; workers with waivers are not
smaller programs that provide assistance to firms and
eligible.
farmers adversely affected by international competition.
 Completion TRA is an additional 13 weeks of benefits
 Trade Adjustment Assistance for Firms supports
that are available only if a worker will complete a
trade-impacted businesses by providing technical
training program during that time.
assistance in developing business recovery plans and
matching funds to implement those plans. The
Wage Insurance for Older Workers:
authorization for the TAA for Firms program was
Reemployment Trade Adjustment
extended by TAARA, and FY2021 funding for the
Assistance (RTAA)
program was $13.5 million. For more information, see
Workers who are age 50 and over can participate in the
CRS Report RS20210, Trade Adjustment Assistance for
RTAA program, which provides a wage supplement to
Firms, by Rachel F. Fefer.
qualified workers who obtain new employment at a lower
wage. RTAA is a payment equal to 50% of the difference
 Trade Adjustment Assistance for Farmers is
between the worker’s wage at his or her TAA-certified job
authorized in statute to provide technical assistance and
and the wage at the worker’s new job. The maximum
cash payments to trade-affected agricultural commodity
RTAA benefit is $10,000 or two years of benefits,
producers. The authorization of the TAA for Farmers
whichever comes first.
program was extended by TAARA, but the program has
not received an appropriation since FY2011. For more
To qualify for RTAA, a worker must either be employed on
information, see CRS Report R40206, Trade Adjustment
a full-time basis (as defined by the laws of the state in
Assistance for Farmers, by Mark A. McMinimy.
which the worker is employed) or be employed at least 20

hours per week and be enrolled in a TAA-sponsored
training program.
Benjamin Collins, Analyst in Labor Policy
IF10570

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Trade Adjustment Assistance for Workers (TAA)

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https://crsreports.congress.gov | IF10570 · VERSION 5 · UPDATED