The Labor Department in The Carter Administration: A Summary Report — January 14, 1981 By Ray Marshall

At the beginning of the Carter Administration, the office of Macro-Economic Policy was merged with ASPER, and ASPER was restructured to focus on general economic policy, jobs and training programs, income maintenance efforts, health and disability issues, and labor-management concerns.

The major efforts of ASPER included:

In early 1977, the country was in a recession with high levels of unemployment. Among the highest priorities of the new Administration was to stimulate the economy to create new private sector jobs and to increase the number of temporary public sector jobs at the beginning of the Carter Administration. ASPER was deeply involved in the design of the stimulus and creation packages, including the development of tax reform proposals. After gaining the initial budget changes needed to implement these programs, ASPER's focus shifted toward more permanent solutions to the underlying economic problems of inflation, unemployment, and low productivity growth.

The first stage of this effort was to develop new, legislatively mandated economic goals while simultaneously evaluating the effects of the stimulus program on the economy. ASPER's longer range efforts included contributions to the Humphrey-Hawkins Act, the first major legislative statement of American economic goals since the Employment Act of 1946. As part of this, ASPER, representing the Secretary, became involved in the on going process of economic forecasting with the other major parts of the Executive Branch concerned with economic policy, the so called "Troika."

The next stage was to concentrate on controlling inflation. ASPER also worked with CEA, Treasury, OMB, and other members of the Administration's Economic Policy Group on the macro aspects of the inflation problem, while developing a more micro approach to the problem. Indeed, ASPER played a key development role in support of the whole gamut of major economic policy initiatives. This included detailed studies of such specific industries as transport and health to determine how they contribute to inflation. One result of these efforts was that the President adopted a sectoral approach to fighting inflation in his speech of October 24, 1978. This was then incorporated into subsequent wage-price guidelines and other efforts of the Administration to control inflation.

Another outcome of the work on inflation was to make organized labor and the various parts of the Administration recognize their commonality of interests in a variety of areas, including trade, employment, labor law reform, etc. ASPER provided the support for the Secretary and President in their meetings with George Meany, Lane Kirkland, Doug Fraser and other union representatives which led to the "accord with Labor" in 1979.

ASPER also worked on a new industrial policy for the country. This work included:

  1. Specific industry task forces to help major industries suffering from increasing foreign competition — particularly the auto industry (support for Chrysler being part of this work) and the steel industry, in which ASPER worked with ILAB to support the government part of the tripartite committee with labor and industry;
  2. Efforts to stimulate growth in productivity working with the Productivity Council;
  3. A series of meetings with the OECD and others working toward global economic stimulus, especially the investment of "excess" OPEC dollars in lesser developed countries (LDCIS); and,
  4. Inter-agency projects to stimulate specific growth, such as the work with the Department of Energy on synfuels.

In short, ASPER performed a key policy development role in support of the whole gamut of major economic policy initiatives of the Administration, ending with this President's plan to revitalize the economy in the 1980s. Essentially, these efforts were only a start towards strengthening the economy — the underlying problems of inflation, unemployment, and low productivity growth still remain. ASPER's welfare reform efforts resulted in two coordinated legislative proposals, but Congress failed to act on either. In order to demonstrate how the jobs proposals might work, a sixteen city pilot test was set up. ASPER's role included design of the pilot selection of the sites, implementation (under way in fourteen cities), and development of information systems which allowed proper monitoring and evaluation of what happens. In the test, all welfare applicants and recipients are counseled to find private sector jobs. If such jobs cannot be found, then either a local public service job is funded, or training is offered. The results to date show an unexpectedly high rate of private sector placement and retention when supervised job search is provided.

Closely related to welfare reform was ASPER's work on improving the Comprehensive Employment and Training Act (CETA) system. ASPER's work was generally reflected in the new CETA legislation.

Once CETA reauthorization was accomplished, ASPER turned its attention to assisting ETA with implementation and other management problems. Among the problems tackled were area wage rates for public service jobs; targeting of job creation efforts; the redesign of the CETA management information system, the development of performance standards for prime sponsors; and the development of incentive awards for good performance.

There were four other areas in which ASPER worked closely with ETA and with other parts of the Administration to improve employment opportunities: 1) In recognition of the very high unemployment rates among youth, especially minority and female youth, a Vice Presidential task force on youth developed a comprehensive, $2 billion initiative to replace the Youth Employment and Demonstration Project Act which expired in September, 1980. Among other things ASPER ensured that the final proposal stressed documentation of participant and operator performance, and focused on helping youth attain marketable work skills and literacy. Research and test designs for evaluating the program were also developed. However, the program has not been enacted by the Congress. 2) ASPER worked with ETA toward strengthening the Employment Service, based on a review of the Wagner-Peyser Act. 3) Efforts were made to bring about job development through urban policy initiatives. 4) ASPER examined how employers' use of criminal records affects employment opportunities, especially for youth.

Work in the latter three areas resulted in establishing a base for future action, but has not resulted in the kinds of changes originally envisioned.

ASPER also assisted in efforts to design a general dislocation policy for industries affected by trade, governmental actions, or other factors which caused major pockets of unemployment.

Finally, ASPER supported the Secretary in areas related to employment and welfare. It coordinated the Department's participation in the development of the Administration's national health insurance proposals; provided analysis for the Secretary as one of the three Trustees of the Old Age, Survivors, Disability, and Health Insurance trust funds (social security and medicare); and developed ideas for work-sharing, especially in times of high unemployment.

Regulatory reform was a major goal of the Carter Administration, and ASPER represented the Department in the development of its systems for improving regulations.

Within the Department, ASPER shifted from being an agency which performed economic impact analyses of regulatory proposals prior to their issuance, to one of encouraging DOL agencies to develop the internal capability for performing good economic analyses.

In specific regulatory areas ASPER provided economic analyses of the employment and inflation effects of new minimum wage legislation, in the salary level tests for administrative, professional, and clerical employees, and with problems related to both the Service Contract Act and the Davis-Bacon and Related Acts. Also, ASPER managed the Department's responsibilities under the National Environmental Policy Act. Departmental regulations implementing these were formally adopted in 1980.

In the area of workers' compensation, ASPER worked with ESA, the Solicitor, and the Economic Policy Group to get the Administration to endorse the idea of having federal minimum standards for state programs. ASPER also worked with ESA on the Federal Workers' compensation programs, particularly the FECA and black lung programs, to develop proposals for major changes.

Under the Black Lung Act Amendments of 1977, ASPER took the lead in studying occupational respiratory and pulmonary diseases. In cooperation with NIOSH and the Social Security Administration, ASPER undertook major new research to better describe the medical nature of such occupational diseases, and to learn how many workers were affected and how much income support they were getting from various sources. An interim report was submitted to Congress in 1980 which outlined the findings to date, explained some of the alternatives to improve compensation, and detailed the research work that remains to be done.

Another major ASPER effort was to work with selected enforcement programs to devise better compliance strategies. The concentration was on OSHA, OFCCP and, to a lesser extent, ERISA.

ASPER's work with OSHA involved the design and test of alternative methods for targeting enforcement resources; an experiment to test whether labor-management safety and health committees reduce the need for direct OSHA compliance efforts; and evaluation of the impact of OSHA standards on productivity in two specific industries.

Nearly all of the programs and policies on which ASPER has worked have either a direct or an indirect impact on labor-management relations. ASPER was also involved in a number of specific labor-management projects, the most important of these being the development of a strike monitoring capability within the Administration.

Other ASPER labor-management projects included the development of a research agenda to encourage the academic community to increase its study of this area; continued work on questions relating to the quality of working life, such as the sponsoring of special surveys of worker attitudes and perceptions; studying costs and other factors involved in labor protection provisions; examination of data on union related crime; and work on workplace privacy issues, such as the confidentiality of medical records.

Finally, ASPER was responsible for the development of a cohesive and coherent research program for the Department, coordinating research and evaluation efforts of all DOL agencies and providing guidance and assistance when needed.