ADVOCACY & POLICY UPDATE - February 17, 2026

Senate Unveils Workforce Development Modernization Legislation

Workforce Development Modernization Act

On Tuesday, February 10, Senators Ted Budd (NC), Bill Cassidy (LA), Pete Ricketts (NE), and Thom Tillis (NC) introduced the Workforce Development Modernization Act, which would amend the Workforce Innovation and Opportunity Act (WIOA) to give local Workforce Development Boards the option to create virtual One-Stop Centers, share resources with other workforce development regions and One-Stop Centers, or co-locate at community colleges. The legislation aims to modernize WIOA’s service model by permitting in-person, virtual, or hybrid approaches to delivering employment and training services.

Click here to access the press release and full text of the legislation. 

Lifelong Learning Act

On Thursday, February 12, Senator Gary Peters (MI) reintroduced the bipartisan Lifelong Learning Act, which updates the Workforce Innovation and Opportunity Act (WIOA) by providing states and Local Workforce Development Boards (LWDBs) greater budgetary flexibility. The bill aims to address local workforce needs and aims to better align federal workforce funding with current labor market conditions by expanding allowable uses of funds to support upskilling, reskilling, and reentry into the labor force.

The legislation would increase the share of adult and dislocated worker funds that LWDBs may use for incumbent worker training from 20 percent to 30 percent, supporting training that helps current employees gain in-demand skills and helps employers avoid layoffs. It would also raise the cap on transitional job programs from 10 percent to 15 percent, expanding opportunities to the labor force. Additionally, it would allow LWDBs to serve as one-stop operators in their local areas, eliminating the requirement to select an operator through a competitive process and supporting more integrated, locally tailored service delivery.

Click here to access the full press release and full text of the legislation.

Investing in Tomorrow’s Workforce Act

On Friday, February 13, Senators Raphael Warnock (GA) and Dick Durbin (IL), along with Congressman Brad Schneider (IL), introduced the bicameral Investing in Tomorrow’s Workforce Act, legislation aimed at strengthening federal support for worker training and reskilling in response to technological change.

The bill addresses labor market shifts driven by automation and emerging technologies and aims to help workers transition into higher-skill and in-demand jobs and strengthen workforce readiness for evolving industries. It would establish a Department of Labor (DOL) grant program supporting industry partnerships that develop training programs for workers displaced or at risk of displacement due to technological advances. It would also increase funding for National Dislocated Worker grants and amend the Workforce Innovation and Opportunity Act (WIOA) to ensure workers affected by automation are eligible for services. 

Click here to access the press release on the bill.

Strengthening Community College Grants Program

On Tuesday, February 10, U.S. Department of Labor (DOL) Employment and Training Administration (ETA) Assistant Secretary Henry Mack announced the Trump Administration will soon launch the community college grant competition Strengthening Community College Grants program, which is intended to boost its Workforce Pell Grant program that supports short-term training programs. 

The Departments of Labor and Education will jointly announce the initiative that will allocate competitive grants to partnerships between community colleges and local industry for workforce development. According to Mack, the program will initially be funded at $65 million with the potential to increase to $130 million and prioritize getting more community colleges prepared for the July 1, 2026 launch of short-term Workforce Pell.

House Education and Workforce Committee Field Hearing

On Friday, February 13, the House Education and Workforce Committee held the field hearing “Work, Dignity, and Choice in Disability Employment" in Beaver Dam, Wisconsin. Hearing witnesses included Coalition for the Preservation of Employment Choice Vice President Kit Brewer, Opportunities, Inc. President and CEO Barbara LeDuc, TransCen., Inc. President Dr. Laura Owens, and Kathy Armstrong — parent of a 14(c) employee.

Click here to access a video of the hearing.

Pell Grant Shortfall 

Expanded eligibility has significantly increased access to the Pell Grant program for low-income students, but the growth has raised concerns about long-term funding sustainability. Changes under the FAFSA Simplification Act of 2021 broadened eligibility and made the application process easier, contributing to higher participation. Economic conditions have also increased enrollment as more individuals pursue education during periods of labor market uncertainty.

For the 2025–2026 cycle, approximately 1.7 million additional students qualified for the maximum Pell Grant, a 27 percent increase compared with the 2023–2024 cycle prior to simplification, according to analysis by the National College Attainment Network. As eligibility expands, demand for program funding has grown. To address an immediate funding gap, Congress provided $10.5 billion in one-time funding for FY26 but the Committee for a Responsible Federal Budget projects a cumulative shortfall of at least $61 billion over the next decade. Updated projections from the Congressional Budget Office (CBO) are expected to provide further clarity.

Historically, lawmakers have addressed Pell Grant shortfalls through temporary funding infusions or by adjusting eligibility and benefit rules. Past cost-containment measures included limiting year-round Pell Grants, which reduced access to summer funding. While such approaches remain options, policy observers note the program’s broad bipartisan support and the political difficulty of restricting eligibility. The Pell Grant remains one of the most widely supported student aid programs with significant bipartisan support but congressional decisions in upcoming budget cycles will determine whether increased eligibility is matched with sustained funding or offset through policy change.

Click here to access the Committee for a Responsible Federal Budget article. 

Click here to access the analysis from the National College Attainment Network.

Unemployment Rate

On Wednesday, February 11, the U.S. Department of Labor (DOL) Employment and Training Administration (ETA) released the January jobs report, which showed employers added 130,000 jobs last month — exceeding forecasts but reflecting slower hiring than seen during stronger post-pandemic years. The unemployment rate declined slightly to 4.3%, down from 4.4% in December. Average hourly earnings growth held steady at 3.7% year-over-year, indicating continued wage growth without acceleration. Job gains were mainly concentrated in health care, social assistance, and construction with some sectors, including the federal government and financial activities, experiencing employment declines.

Last month’s report indicates a labor market transitioning from rapid expansion toward steadier growth. Hiring continued and unemployment remained low, but revisions and sector trends suggest employers are becoming more cautious, with growth concentrated in fewer industries rather than broad-based expansion.

Click here to access the full report.

Click here to access Secretary of Labor Chavez-DeRemer’s statement on the January jobs report.