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HRD-82-121 1 (1982-09-10)

handle is hein.gao/gaobabmou0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 HUMAN RESOUCS RESTRICTED -Not to be released outside the ae1IiVUW DIVISION Accounting Oflice except on the basis of specific approval by the Office of Congressional Relations. a-208873 SEPTEMBER 10,1862 The Honorable John Heinz RELEASED United States Senate Dear Senator HeinzI 11!9457 Subjects !'Information on the 1974 Trade Act Worker Adjustment Assistance Program Certification Process (GAO/HRD-82-12 1) This report responds to your March 12# 1982, request that we review the Department of Labor's recent administration of the petition certification (approval/denial) process under the worker adjustment assistance program authorized by the Trade Act of 1974 (19 U.S.C. 2101). You were especially concerned about the decline in the number of petitions approved for benefits. We briefed your office on the information in this report on July 23, 1982. In, response to your request and as agreed with your offtce, we analyzed a 10-percent random Sample, stratified by industry, of the 295 petitions denied during September and October 1981. In addition, we interviewed the Labor officials who were responsible for investigating, reviewing, and certifying the petitions in our sample. Information obtained is summarized below and detailed in enclosure I and the exhibits. In calendar year 1980, Labor denied 62 percent of the peti- tions it investigated. The denial rate rose to 84 percent in calendar year 1981 and was 81 percent for the first 6 months of 1982. Our analysis showed that while Labpr did not formally im- plement a policy to increase petition denials, some of its actions created an atmosphere that resulted in a more conservative appli- cation of the act's provisions in the review process. We determined that several shortcomings in the petition certi- fication process and other factors affected the increase in denials, but a lack of quantifiable information prevented a precise measure- ment of the degree to which these shortcomings or other factors contributed. The shortcomings include (1) not having specific criteria for applying that portion of the legislation relating to whether increased imports contributed importantly to worker separ- ations, or the threat thereof, and to the absolute decrease in sales or production and (2) relying on data collected from a firm's customers to determine the impact of imports on such customers' purchases both individually and as a group. Such data, referred to as customer survey data, are usually not verified and often represent a relatively small percentage of a firm's sales. (204802)

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