The bill directs the Secretary of Labor to award competitive grants to industry/sector partnerships for demonstration and pilot projects that retrain workers who are, or are likely to become, dislocated because of automation. Grants may run up to four years and fund services ranging from technology skills training and integrated education to stipends, equipment, and employer-focused incumbent worker training.
Award decisions must prioritize areas with high concentrations of covered populations and industries at high risk of automation.
The Act also amends the Workforce Innovation and Opportunity Act (WIOA) to explicitly authorize training for workers displaced by automation in adult and dislocated worker programs and expands National Dislocated Worker Grant (NDWG) eligibility to include automation-related displacements, with a $40 million annual authorization for NDWGs through 2030. The pilots must submit disaggregated outcome reports; grants must comply with WIOA labor standards and nondiscrimination rules.
For DOL, providers, employers, and local boards this creates new competitive funding streams, reporting obligations, and incentives to tie employer hiring practices to training outcomes.
At a Glance
What It Does
The Secretary of Labor will award competitive, up-to-4-year grants to eligible partnerships to design and run pilot projects that retrain workers affected by automation. The bill adds automation-related training to WIOA’s adult/dislocated worker programs and authorizes $40 million per year for NDWGs for 2026–2030.
Who It Affects
Eligible partnerships (industry/sector partnerships expanded to include State/local workforce boards and economic development organizations), dislocated workers and covered populations (the statute ties to WIOA’s barriers-to-employment definition), community colleges and training providers, employers that partner on incumbent worker training, and State/DOL administrators who oversee grants and reporting.
Why It Matters
This law channels targeted federal dollars to locally designed retraining pilots and tests employer-backed incumbent worker strategies while embedding reporting and nondiscrimination conditions. It creates a policy lever to prioritize populations shown to be most at risk of automation and to build evidence about what training actually transitions workers into in‑demand jobs.
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What This Bill Actually Does
The Act creates a new competitive grant program run by the Department of Labor for demonstration and pilot projects that focus on workers displaced or at risk of displacement from automation. Grants are available to ‘‘eligible partnerships’’—industry or sector partnerships that the bill enlarges to require participation by State or local workforce boards and economic development organizations alongside employers and training providers.
Applications must describe the partnership members, training services to be offered (including technology- and digital-literacy training), goals for upskilling, and plans to engage covered populations with barriers to employment.
Award decisions follow a clear priority order: first, partnerships located in areas with a high percentage of covered populations; second, where funding remains, partnerships in areas with heavy concentrations of industries likely to be affected by automation or in in‑demand sectors. The bill encourages incumbent worker training that helps current employees upskill to avoid layoffs and asks grantees to show how employer partners will backfill positions vacated by upskilled incumbent workers.Grant funds may pay for direct training services, equipment and technology for instruction, hiring a staff position to administer training at employer sites, stipends and transitional assistance (including child care supports and transportation stipends), integrated education and training, and other services to smooth reemployment.
Grantees must follow WIOA labor standards and nondiscrimination requirements. Each completed pilot requires a report to DOL with counts of participants, transition and placement rates, earnings data, second- and fourth-quarter post‑exit outcomes, and best practices; those data must be provided in the aggregate and disaggregated by training type, age, gender, and race.Separately, the Act amends two WIOA provisions.
It adds training for individuals displaced by automation to the list of allowable adult and dislocated worker training programs and expands triggers for National Dislocated Worker Grants to include ‘‘advances in automation technology.’’ The bill expressly authorizes $40 million per year for NDWGs for fiscal years 2026–2030 and authorizes unspecified sums (‘‘such sums as may be necessary’’) to carry out the new pilot grant program from 2026 through 2030.
The Five Things You Need to Know
Grants are competitive, limited to a maximum duration of 4 years, and awarded to ‘‘eligible partnerships’’ that must include State/local workforce boards and economic development organizations alongside employers and training providers.
The Secretary must prioritize partnerships in areas with high shares of ‘‘covered populations’’ (as defined by WIOA’s barriers-to-employment list) before funding other applicants.
Eligible uses include direct training (including digital literacy and tech skills), purchasing training equipment, paid stipends, paid leave supports, transportation/child care assistance, integrated education and incumbent worker training tied to employer backfilling plans.
Grantees must submit a post-project report with participant counts, transition-to-job metrics, annual earnings, second- and fourth-quarter post‑exit employment/education rates, and disaggregation by training type, age, gender, and race.
The bill amends WIOA to recognize automation as an NDWG trigger and authorizes $40,000,000 per year for NDWGs for fiscal years 2026 through 2030; funding for the new pilot grants is authorized as ‘‘such sums as may be necessary’’ for 2026–2030.
Section-by-Section Breakdown
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Short title
Gives the Act the public name ‘‘Investing in Tomorrow’s Workforce Act of 2026.’
Scope of ‘‘automation’’ and covered populations
The bill supplies operational definitions that shape eligibility: ‘‘automation’’ explicitly lists technologies from data analytics and 3‑D printing to collaborative robotics and autonomous vehicles, which broadens the kinds of industry disruptions the program can address. ‘‘Covered population’’ links to WIOA’s barriers-to-employment list, meaning populations already eligible for priority service under WIOA are the explicit focus for grant prioritization and outreach. Those definitions determine both who the pilots must serve and which local labor markets are candidates for priority funding.
Competitive pilot grants and required application content
DOL must run a competitive process for partnerships to propose demonstration projects; grants are capped at 4 years. Applications must identify partnership members, the specific training services to be delivered (including technology skills), measurable goals for upskilling and placement, and plans to engage covered populations. The requirement that partnerships describe employer participation and training paths creates an expectation that pilots will be employer‑aligned and locally tailored rather than purely classroom-based.
Funding priorities, allowable uses, reporting, and compliance conditions
The statute sets a two-tiered priority: first to areas with high percentages of covered populations; then to areas concentrated in industries at high risk of automation or in‑demand sectors. The bill explicitly permits incumbent worker training and requires grantees to show how employers will backfill roles, supports a range of participant benefits (stipends, paid leave, child care assistance), and allows equipment purchases. Each completed pilot must submit detailed, disaggregated outcome data; grantees must observe WIOA labor standards and nondiscrimination rules, which means existing Davis‑Bacon and equal-opportunity frameworks apply to these grants.
WIOA changes and explicit NDWG appropriation
The Act amends WIOA section 134(d)(1)(A) to add training for workers displaced by automation to the list of allowable training programs for adults and dislocated workers. It inserts ‘‘advances in automation technology’’ as a listed trigger for National Dislocated Worker Grants and adds an explicit authorization of $40 million per year for NDWG activities for fiscal years 2026–2030. Meanwhile, pilot grant funding is authorized by the catch-all phrase ‘‘such sums as may be necessary’’ for the same period, leaving exact pilot funding levels unspecified.
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Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Dislocated workers at risk from automation — The program targets workers in industries likely to be automated and prioritizes populations with barriers to employment, offering paid stipends, child care/transportation supports, and technology-focused reskilling to improve reemployment prospects.
- Workers earning under $40,000 and historically disadvantaged groups — By tying priority to WIOA’s covered populations, the bill directs initial funding toward women, people of color, and low‑income workers who studies show face higher automation risk.
- Employers seeking to retain talent — The bill supports incumbent worker training and permits grants to fund employer staff positions to manage training, giving employers a low‑cost route to upskill existing employees instead of laying them off.
- Community colleges and training providers — Grants pay for equipment, curriculum development, and integrated education and training, creating new revenue and partnership opportunities for local providers.
- Local workforce boards and economic development organizations — The expanded role in eligible partnerships increases their influence over regional workforce strategies and access to federal pilot funding.
Who Bears the Cost
- Federal budget and appropriations committees — The bill requires new federal outlays: an explicit $40 million/year for NDWGs plus unspecified amounts for pilot grants between 2026 and 2030, which will compete with other priorities.
- Employers that must backfill or create new roles — The statute encourages employer backfilling and may create hiring costs for firms who must recruit replacements for upskilled incumbent workers.
- Training providers and employers — New reporting requirements and compliance with WIOA labor standards create administrative burdens and potential costs for data systems and staff time to capture disaggregated outcomes.
- State and local workforce agencies — Administering, monitoring, and coordinating the expanded partnerships and grantee compliance will increase workload; absent earmarked administrative funds, this could strain existing budgets.
- Department of Labor — DOL will need resources to design the competitive process, evaluate pilots, manage data collection, and synthesize best practices into scalable models.
Key Issues
The Core Tension
The central dilemma is between rapid, locally tailored investment to upskill workers displaced by automation and the need for durable, evidence-based programs that align with real labor market demand and sustainable funding. Targeted pilots and employer-aligned incumbent training can produce quick wins for individuals, but without clear funding levels, rigorous long-term outcomes, and tight alignment with regional hiring demand, the approach risks producing fragmented, short-lived interventions that don’t scale.
The bill creates a targeted pilot approach but leaves two central implementation ambiguities. First, pilot funding is authorized as ‘‘such sums as may be necessary’’ rather than a concrete appropriation, so the program’s scale depends on future budget action; this differs from the explicit $40 million NDWG authorization and could make planning for multi‑year pilots difficult.
Second, the statute asks partnerships to tie incumbent worker training to employer backfilling plans, which is policy-forward but creates practical questions about enforcement and whether small employers can realistically hire replacements.
Measurement and fidelity pose additional challenges. The reporting requirements capture second- and fourth-quarter post‑exit outcomes plus earnings and disaggregations, which provide near-term signals but may understate long-term career mobility.
Local labor-market alignment is another tension: grants encourage regionally in‑demand placements, yet ‘‘in‑demand’’ definitions and forecasts can change quickly with technology cycles. Finally, expanding NDWG triggers to include ‘‘advances in automation technology’’ broadens eligibility but raises discretionary judgment calls about what counts as automation-induced displacement versus ordinary churn, which may produce inconsistent State-by‑State NDWG usage.
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