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Jobless Aid Fails to Keep Up With Employment Changes : Society: Except for a few shining examples, the aging system isn't providing the help displaced workers need.

Jobless Aid Fails to Keep Up With Employment Changes. FIRST OF TWO PARTS


TAMPA, Fla. — Ruth LaHue tells the sort of success story government policy planners dream about.

Laid off in early February from her secretary's job, the 47-year-old mother of three visited an innovative unemployment benefits office here and spoke with a job counselor familiar with state and federal programs for displaced workers. The counselor took her to another office for a skills test and a review of possible career goals.

Now LaHue has made plans to return to college to fulfill a long-held dream of becoming a special education teacher--honing talents learned through caring for a 15-year-old son who is deaf.

"I felt really devastated when I lost my job," she says, "but that doesn't mean something really good couldn't come out of it."

Usually, however, it doesn't.

Despite isolated examples such as the employment center that helped LaHue, the nation's unemployment system--a 59-year-old patchwork of programs established by the New Deal as a key part of the nation's social safety net--is badly out of date and failing to provide the help displaced workers need.

The reason: The nature of unemployment in America has changed but the unemployment system has remained the same.

Tampa's setup, where state officials have consolidated in one building a range of programs to aid displaced workers, is the exception. In many parts of the country the local unemployment office, where people apply for benefits, and the employment service, which is supposed to help people find new jobs, are not even located in the same part of town. Existing federal programs are widely scattered and often poorly coordinated with state and local efforts.

Federal programs to aid dislocated workers manage to provide some level of assistance to roughly half a million people a year, but under widely varying and often bewildering rules and regulations. One program aids workers who have lost jobs because of import competition, another exists to help workers whose jobs have suffered because of clean air rules, still another benefits the small number of workers displaced by Redwood National Park in Northern California.

When a Pennsylvania plant that made paper goods closed recently, workers who had made paper napkins there were deemed eligible for federal aid on the grounds of import competition. Those who had made paper cups were out of luck.

The problems of the unemployment system seemed more critical a year ago, when many economists believed that the country faced a "jobless recovery" in which even economic growth would not bring back robust employment figures.

Today that fear has faded. Nationally, the unemployment rate has dropped steadily and, even in hard-hit Southern California, employment is beginning to show some signs of recovery. By 1997, the majority of government and private economists forecast, the United States will once again have reached the "full employment" level--the term economists use to designate the lowest level that unemployment can reach without sparking inflation.

But even at the full-employment level, more than 6.5 million Americans will remain looking for work and millions more will be stuck in part-time or temporary jobs when they would prefer full-time work.

With those figures in mind, President Clinton and Labor Secretary Robert B. Reich have made fixing the shortcomings of the U.S. unemployment system a priority. Earlier this month, Clinton unveiled legislation to improve the system--an initiative that has been Reich's top priority for this year.

Even with the recession over and unemployment rates dropping, Reich says, what he calls a "re-employment" system would address an important public concern. "Many people are scratching their heads and saying, 'Wait a minute. The economy is getting better, jobs are coming back, so why do I feel so insecure?' "

Part of the answer, Reich argues, is the belief many workers share that if they lose their job, they will have neither the skills to find new work nor any government program capable of helping.

"In a democratic society, there really are only two alternatives," he says. "Either people hold on to what they have--they seek regulations, they seek protectionist barriers to imports, they don't want to allow immigrants into the country, they sort of hunker down--or they find easy passageways to new jobs and better alternatives."

If the country wants to keep the open and flexible labor markets that have been a major contributor to U.S. prosperity--and a major reason that the United States has avoided the economic problems now plaguing Western Europe--then "we all have a stake in making sure people can move to new and better jobs quickly."

Research on experimental state programs scattered across the country over the last decade indicates that well-designed government programs can significantly ease the transition from one job to the next. But so far no one is trying to expand those scattered initiatives into a national system.

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