Summary: GAO discussed the U.S. Employment Service's (ES) basic labor exchange program. GAO noted that: (1) the Department of Labor (DOL) gave state governments broad authority to implement ES programs; (2) ES placement performance varied by states and local offices, primarily due to state and local practices within the control of ES managers; (3) state management practices associated with better performance included setting measurable performance goals, providing incentives, and conducting frequent on-site monitoring of local offices; (4) although such factors as attentiveness to employer and applicant needs, extensive interaction with the Job Training Partnership Act Program, and separation of ES and local office functions improved local office operations, many state and local ES programs did not adopt those or similar practices; (5) although DOL and the states were responsible for ensuring that ES operates an effective labor exchange system, DOL reported difficulty in balancing its oversight needs against limiting federal intrusion into state affairs; and (6) while ES programs in some states flourished without federal assistance, wide variations in local office performance indicated that some states needed DOL help to improve their programs.
