What Is Subsidized Employment?

A subsidized wage program helps an employee acquire skills to advance to a higher paid job.

Getting a job can be especially difficult without adequate skills. The federal government developed a wage subsidy program to create jobs and promote training. The program helps employees become self-sufficient to be able to advance in unsubsidized jobs. The subsidy program helps businesses afford to hire employees, creating a win for the employer, a win for the employee and a win for the government as more people find jobs.

Purpose

Under the U.S. American Recovery and Reinvestment Act to help create jobs in the private, nonprofit and government sectors, the government developed the subsidized Temporary Assistance for Needy Families. The TANF program allows states to draw funds for employment subsidy for basic assistance, short-term benefits and services, and subsidized jobs for low-income families to help employers fill positions in both blue- and white-collar positions.

Employer Reimbursements

Under subsidized employment, employers receive a reimbursement of payments from state governments as a portion of salaries or wages that employers pay to employees in the program. Employers must purchase workers' compensation, which is not reimbursable. The term of reimbursements is up to six months or until the employee's family assistance benefits terminate, or the employee quits, whichever occurs first.

Employee Wage and Benefits

Employees in the program are paid the same wages or salary as well as benefits as those in an unsubsidized program and have the same opportunities for advancement. An employee is hired 35 to 40 hours per week under a full-time position. If an unsubsidized full-time opportunity become available, the subsidized employee must be given preference after completing his probationary or training period.

Applicants

Job applicants who cannot find unsubsidized jobs may qualify under the government subsidized program. The applicant's employment case manager screens and matches the applicant with a suitable program. The program may also suit part-time, seasonal or minimum-wage workers who have not found full-time or sufficient work to meet their income requirements. The program offers an opportunity to increase job skills for better wages and greater job opportunities.

References

• Alaska Department of Public Assistance: Subsidized Employment
• LAWriter Ohio Laws and Rules: Subsidized Employment Program.
• U.S. Government Printing Office: American Recovery and Reinvestment Act of 2009
• California Department of Social Services: Subsidized Summer Youth Employment Program Temporary Assistance for Needy Families Emergency Contingency Fund
• Jackson, Alabama, Area Chamber of Commerce: Subsidized Employment Program (SEP) Employer Fact Sheet

Resources

• CLASP: Job Creation
• The White House: Subsidized Jobs -- Helping Americans Get Back to Work
• Center on Budget and Policy Priorities: American Recovery and Reinvestment Act of 2009 ...