DIRECTIVE	:	EMPLOYMENT SERVICE PROGRAM LETTER NO. 11-98
TO	:	ALL STATE EMPLOYMENT SECURITY AGENCIES
FROM	:	JOHN R. BEVERLY III Director United States Employment Service
SUBJECT	:	United States Employment Service Unemployment Insurance (UI)/Employment Service (ES) Dialogue Paper

1. Purpose. To circulate for comment the UI/ES Dialogue paper. Companion directives transmitting this information will be issued by the UI and Job Training Partnership Act program offices.

2. Background. On March 13, Secretary Herman announced the beginning of a year-long UI/ES Dialogue -- a public interchange on the role, effectiveness and design of the UI and ES (i.e., Wagner-Peyser Act service provider) programs. Recent years have seen rapid changes in the economy and in the workforce, accompanied by movement in several key indicators of UI activity and outcomes including long-term downtrends in recipiency, wage replacement, reemployment services, and Trust Fund solvency rates. These indicators. suggest that UI and ES may be playing a diminishing role in economic activity generally and the labor market in particular. These findings call for a broad reevaluation of the Employment Security system's impact and of whether. the UI and ES programs are performing as they should to achieve their stated mission into the 21st century.

3. The Dialogue Paper. The centerpiece document for the dialogue is the attached paper, A Dialogue: Unemployment Insurance and Employment Service Programs. The Department of Labor plans to circulate this paper widely to ensure that as many interested parties as possible participate in the conversation on the proper shape and role of these two key elements of the workforce development system. The Dialogue paper concisely states the major facts and issues on which public comment are desired. It should be read in conjunction with its two accompanying items. The first, an introduction, sets the stage and poses several questions related to key dialogue issues. The second is the Technical Supplement--a more detailed treatment of the basis for the dialogue issues.

4. Action Required. Recipients of this ESPL are requested to make the attached Dialogue materials available to all interested staff and encourage them to submit comments as desired. Comments are requested by August 7, 1998.

5. Inquiries. Direct questions to the appropriate Regional office.

6. Attachment. Dialogue Materials: Introduction; Dialogue Paper; Technical Supplement