The Rise of Poverty Inc.

The Atlantic, June, 2024 (excerpt)

… Perhaps the clearest example of public-choice theory turned on its head is Job Corps, a $1.8 billion job-training program for young adults that, unlike most War on Poverty initiatives, has been contracted out since its inception in 1964. Decades of evidence suggest that the program accomplishes very little. It served barely 50,000 students a year before the pandemic, meaning it cost about $34,000 a student. (Job Corps largely shut down during the pandemic and hasn’t fully restored operations since.) In one 2018 audit, the Department of Labor’s inspector general concluded that the program “could not demonstrate beneficial job training outcomes.” Another investigation, by the Government Accountability Office, noted more than 13,500 safety incidents from 2016 to 2017 at Job Corps centers, nearly half of them drug-related episodes or assaults. In 2015, two students were murdered in separate campus-related crimes. Critics have also questioned the value of running an expensive residential program in mostly rural areas, far from actual jobs.

Job Corps administrators manage to hang on to government contracts for decades. (One such company notes on its website that it won its first Job Corps contract in 1964.) Today, the biggest operator is the Management & Training Corporation, a Utah-based company that runs 20 Job Corps centers nationwide. In 2022, MTC won three multiyear contracts, worth a total of about $263 million, to run Job Corps Centers in Nevada, New Jersey, and Hawaii. The program remains popular in Congress, especially in districts where centers are located. The Friends of Job Corps Congressional Caucus, organized by a lobbying organization for Job Corps contractors, has 80 members. (MTC’s president serves on the organization’s board.)

Contractors’ longevity stems in part from their ability to outlast administrations—and the simple fact that, once a contract is awarded, the company that wins it often becomes a de facto monopoly. When the next contract rolls around, there may be no credible competitors.

In short, an effort to curtail Big Government has instead preserved the worst of both worlds: all the spending and bloat of government, with none of the public accountability. No wonder, then, that poverty sticks around. There’s simply too much demand for it….

read … The Rise of Poverty Inc. - The Atlantic

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US Department of Labor pauses Job Corps center operations

News Release from USDOL, May 29, 2025

WASHINGTON – The U.S. Department of Labor today announced it will begin a phased pause in operations at contractor-operated Job Corps centers nationwide, initiating an orderly transition for students, staff, and local communities. The decision follows an internal review of the program’s outcome and structure and will be carried out in accordance with available funding, the statutory framework established under the Workforce Innovation and Opportunity Act, and congressional notification requirements.  

The pause of operations at all contractor-operated Job Corps centers will occur by June 30, 2025. As the transition begins, the department is collaborating with state and local workforce partners to assist current students in advancing their training and connecting them with education and employment opportunities. 

The department’s decision aligns with the President’s FY 2026 budget proposal and reflects the Administration’s commitment to ensure federal workforce investments deliver meaningful results for both students and taxpayers.

“Job Corps was created to help young adults build a pathway to a better life through education, training, and community,” said Secretary Lori Chavez-DeRemer. “However, a startling number of serious incident reports and our in-depth fiscal analysis reveal the program is no longer achieving the intended outcomes that students deserve. We remain committed to ensuring all participants are supported through this transition and connected with the resources they need to succeed as we evaluate the program’s possibilities.” 

The Job Corps program has faced significant financial challenges under its current operating structure. In PY 2024, the program operated at a $140 million deficit, requiring the Biden administration to implement a pause in center operations to complete the program year. The deficit is projected to reach $213 million in PY 2025.

On April 25, 2025, the department’s Employment and Training Administration released the first-ever Job Corps Transparency Report, which analyzed the financial performance and operational costs of the most recently available metrics of program year 2023. A summary of the overall findings: 

Average Graduation Rate (WIOA Definition): 38.6%
Average Cost Per Student Per Year: $80,284.65         
Average Total Cost Per Graduate (WIOA Definition): $155,600.74
Post separation, participants earn $16,695 annually on average.
The total number of Serious Incident Reports for program year 2023: 14,913 infractions.

Inappropriate Sexual Behavior and Sexual Assaults Reported: 372
Acts of Violence Reported: 1,764
Breaches of Safety or Security: 1,167
Reported Drug Use: 2,702
Total Hospital Visits: 1,808

Additional information can be found in the FAQs.

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Rep. Tokuda Condemns Decision to Pause Job Corps Operations 

Nationally recognized locations in Hawaiʻi will be affected

News Release from Office of Rep Jill Tokuda, May 29, 2025

Washington, DC -- Today, U.S. Representative Jill Tokuda (HI-02) issued the following statement after the U.S. Department of Labor (USDOL) announced plans to pause operations at all contractor-run Job Corps centers nationwide, including Hawaiʻi’s nationally recognized programs on Maui and Oʻahu. 

"I am outraged by the Department of Labor’s reckless decision to halt operations at Job Corps centers, a lifeline for young people in Hawaiʻi and across the country. This isn’t budget management; it’s a betrayal. Job Corps works. It gives vulnerable youth the tools to build stable futures and creates economic opportunities in our communities. Shutting it down abandons them and undermines everything we claim to stand for.

When Maui was in crisis, it was Job Corps students who showed up — delivering aid, offering comfort, standing strong for their neighbors. That’s not just a program. That’s resilience in action.

We should be investing more in Job Corps, not gutting it. I will fight this shortsighted move and focus on increasing our support because our youth deserve opportunity, not abandonment."

Hawaiʻi’s two Job Corps campuses on Maui and Oʻahu, ranked second out of 125 locations nationwide, provide hands-on career training in high-demand fields. In 2024, 112 Hawaiʻi students launched careers through the program. Over 80 percent of Hawaiʻi graduates are employed, enrolled in college, or plan on serving in the military within six months — earning an average wage of $17.87 per hour, well above the state and federal minimum wage.

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KITV: Job Corps centers nationwide to pause operations by June 2025 | Business | kitv.com

SA: Hawaii Job Corps to close … Between the Oahu and Maui campuses, there are 209 enrolled students and 161 staff… For Hawaii in 2023, the study found that 63.5% of students graduated and that it cost $34,088 per graduate and $14,795 a year per student, while the average annual income after leaving the program was $15,164.  The report said there were 79 incidents at Hawaii Job Corps, though incidents were not categorized.  Hawaii Job Corps cost $4.3 million in 2023….