Soaring auto layoffs and job losses in steel, rubber, electrical manufacturing, and other industries are expected to add $1 billion to the Carter administration's budge for American workers unemployed because of imports.
The Labor Department estimates that 593,000 workers will receive foreign-trade adjustment benefits this year, most of them in the auto industry and satellite industries dependent on auto business. Labor Secretary Ray Marshall warned then that unless Congress provided more money, reserves for benefits would be exhausted by May 23.
The House agreed this week to provide the needed funds, incorporating an additional $1 billion for trade adjustment assistance in a bill to increase the 1980 federal budget by $24 billion. However, the program set up in 1962 under the Trade Expansion Act came under sharp critisicm for its rapidly expanding assistance to relatively high-income workers, many of them laid off only for short periods. Many on Capital Hill say that other manpower programs will be squeezed by the unexpectedly high foreign-trade job benefits.
The result is expected to be a re-examination of the program, with the focus particularly on eligiblity standards and benefits.
The Labor Department announced on April 26 that 93,500 Ford Motor Company workers and 38,600 General Motors employees in 13 states can apply for the federal benefits as a result of layoffs caused by rising sales of imported automobiles and trucks. At the same time, it declared 4,000 other Ford and GM workers ineligible, because imports were not the principal reason for their layoffs.
The additional 132,100 auto workers who now qualify for aid will swell the record numbers already on the rolls.
Altogether 282,000 auto workers have been ruled eligible to receive as much as $269 a week in benefits under the trade act since the start of the 1980 fiscal year, last Oct. 1.
Those qualified become eligible for benefits that, with regular unemployment benefits, provide up to 70 percent of average weekly wages for up to one year. In addition, those laid off from jobs permanently can receive free restraining for another job, up to $500 to cover 80 percent of the cost of finding a new job and up to $500 to cover the costs of relocating. There is a $269-a-week ceiling for wage assistance.
The worker's aid program was written into the Trade Expansion Act of 1962 to get labor support for a measure intended to give US consumers greater access to foreign goods and to provide foreign price competition with domestic producers. The original eligibility rules were so restrictive that few workers were aided until the program was revised in 1974. Congressional critics now say the eligibility rules are too loose.
Rep. Sam M. Gibbons (D) of Florida said during recent hearings that "fully 70 percent of those unemployed due to the impact of imports are back at work before they get a single dollar of benefits." If they can get by during temporary layoffs, he said, "One wonders whether they need aid at all."
Some new proposals would limit payments to those who exhaust regular unemployment benefits or would deny benefits for the first 13 weeks of unemployment. Another proposal would require laid-off workers to take retraining for other jobs to be eligible for benefits; few do now. As of last September, only 18,347 who lost jobs had agreed to be retrained; only 2,714 had asked for aid in finding new jobs; and a scant 1,744 had sought relocation assistance.
Labor, meanwhile, wants the program expanded to allow benefits for workers who lose jobs in plants only indirectly affected by imports. To get this, union spokemen appear willing to support some modification in the program as a whole.