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With Federal Funds Gone, States Take the Lead on Subsidized Jobs

I highlighted yesterday the success of a 2009 Recovery Act program through which 39 states and the District of Columbia placed 260,000 low-income parents and young people in subsidized jobs, mostly in the private sector.  The federal funding for that program dried up a few years ago.  But several states — recognizing that these programs hold huge promise for the long-term unemployed and others who often have great difficulty getting hired — have decided to use their own funds to create or expand subsidized jobs programs.  Here are some examples:

  • Connecticut Governor Dannel Malloy this week proposed a $3.6 million initiative, targeted to the long-term unemployed, that will combine a job-readiness program, supportive services, financial coaching, and an eight-week paid work program.  He also proposed expanding a program that offers two incentives to employers to hire additional employees:  a six-month wage subsidy and grants to small manufacturers to train new workers.
  • Colorado is implementing a two-year, $2.4 million subsidized jobs program targeted to non-custodial parents, veterans, and displaced workers aged 50 years or older who are below 150 percent of the poverty line.
  • Nebraska, Minnesota, and California are starting or expanding subsidized programs for recipients of Temporary Assistance for Needy Families (TANF).  Nebraska plans to spend $1.1 million per year to operate a two-year pilot program.  Minnesota plans to spend $2.2 million each year over the next two years on a new program to encourage employers to hire long-term TANF recipients.  And California’s Governor Jerry Brown has proposed boosting funding for subsidized jobs by almost $100 million this year, to $134 million.

As their budgets rebound, states will have resources to make new investments.  More states should follow the lead of these states and some other local communities that have decided that providing subsidized jobs is a winning proposition for the unemployed, employers, and local communities.