What Does Trade Adjustment Assistance Mean?

Trade adjustment assistance (TAA) offers job training, relocation allowances, income support and help with healthcare premiums and related benefits to workers in the U.S. who lost jobs due to the effects of increased imports.

The government program, run by an office within the U.S. Department of Labor, unofficially started as part of the Trade Expansion Act of 1962. It began formally in 1974, with notable amendments in following years. The current program, redesigned in 2015, runs until 2021, unless Congress renews it again.

To qualify for trade adjustment assistance, affected workers must first file a petition indicating that their job loss largely resulted from the effects of foreign trade. Most state unemployment offices have the needed forms.

The program also supplements incomes of dislocated workers ages 50 and over who take a job at a lower wage than they earned previously.

Understanding Trade Adjustment Assistance (TAA)

Trade adjustment assistance (TAA) attempts to offer U.S. workers, particularly those in manufacturing industries hard hit by globalization and overseas outsourcing, a chance to build skills and credentials to help them transfer into new careers.

In fiscal year 2020, the agency said an estimated 23,436 individuals used TAA benefits and services. Nearly half received training for a new position, of which 91% earned some sort of training credential. The agency says 76% of participants in the program obtained employment within six months.

While the program mainly benefits those in manufacturing industries, a smaller number of farmers, as well as workers in scientific, technical and finance industries, also use the program.

Pros and Cons of Trade Adjustment Assistance

Some vehemently oppose Trade Adjustment Assistance, and see it as a way for supporters of free trade to win over those destined to lose out when their jobs are shipped overseas. Similarly, some opponents of liberalized trade call trade adjustment assistance “burial insurance” for dead jobs that come as a result of trade agreements, such as the North American Free Trade Agreement. They also point out the program costs hundreds of millions of dollars and help only a small percentage of affected workers.

Proponents argue more broadly that free trade lowers prices for consumers, benefiting nearly everyone, with a few notable exceptions. Also, the trade deficit results mainly from increased wealth in the U.S., and the net effect of U.S. consumers having more money to buy overseas goods. Some proponents say it’s impossible to replace all jobs lost as a result of free trade at the previous level of income. However, a job in a new industry, even one that pays less than before, may be significantly better than what workers might find without the benefits of trade adjustment assistance.