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What Is Trade Adjustment Assistance?

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  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 14 September 2014
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Trade Adjustment Assistance (TAA) is a type of program that aids displaced workers to develop new job skills and find work in different industries. One of the more common examples of this type of program is found in the United States, and has been used to help consumers who lost jobs due to downsizing within an industry to develop skills that allowed them to seek employment opportunities in different fields. In the United States, the Trade Adjustment Assistance program was developed as a joint effort between the US Department of Labor, the Department of Commerce, and the Department of Agriculture.

The origins of the Trade Adjustment Assistance initiative in the United States took place as shifts in the economy began to occur, due to changes in the balance between imports and exports. One of the more significant examples of this type of activity occurred with the textile industry in the United States during the 1960s and beyond. As more textiles were imported into the nation, US-based textile manufacturers began to curtail plant operations within the country. Some of the reductions were part of a strategy to move operations abroad, taking advantage of lower labor and operational costs. At other times, the close of textile plants was due to a loss in profits that made the operation of those plants difficult to sustain.

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As more workers were displaced due to the plant closings, the Trade Expansion Act of 1962 along with the Trade Act of 1974 provided for resources to aid those displaced workers to develop new job skills that would allow them to move into other industries that were less impacted by the shift in the balance between imports and exports. The exact process for managing this reeducation and job placement initiative varied, sometimes due to the type of job opportunities that remained in the area where the displaced employees resided. In some cases, the program also provided help with relocation to other communities that were capable of providing a wider range of job opportunities.

Qualifying for participation in the Trade Adjustment Assistance program usually requires proof that the workers have been directly impacted by increased imports that in turn trigger a reduction in the production efforts of their employers. The amount of that impact must be significant, and has at times been identified as a minimum of 20% of the employer’s production or sales. Companies that serve as major suppliers to the companies directly affected by imports may also qualify for some type of assistance.

When the employee is let go due to no work being available or a plant facility closing, the provisions of the Trade Adjustment Assistance help to create educational opportunities that allow the employee to gain the skills necessary to secure viable employment in another field. This can include resources that cover the costs of technical training or some type of program specifically designed by the state and approved by the Department of Labor. The overriding goal of Trade Adjustment Assistance is to equip individuals for employment, which helps to keep the percentage of unemployed citizens at a lower rate. In some states, the programs would not only include job education, but also aid in the task of job placement upon successful completion of the retraining effort.

Over time, Trade Adjustment Assistance has provided training and placement opportunities for individuals formerly related to a number of industries. Farmers have sometimes been eligible for the program, as well as employees in the electronics and automotive industries. Since 2006, individuals employed with companies that produce digital products have also been covered under the provisions of this program, making it possible for employees who lose their jobs due to software imports to also seek assistance.

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