Consistent with timing in previous years, OFCCP has recently updated the hiring benchmark for protected veterans. In annual affirmative action plans (AAPs), comparing the number of hires to a predetermined veteran benchmark is a required element of federal contractor compliance with the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA). If you are selected for a VEVRAA focused review, you can expect that the hiring benchmark will be given greater scrutiny.
As of March 31, 2020, the nationally set benchmark is now 5.7 percent. This is a slight downturn from 2019’s benchmark of 5.9 percent. In fact, the benchmark has decreased every year since VEVRAA’s inception in 2014 (see Figure 1 below).
|
|
VEVRAA Benchmark |
Overall US Unemployment |
|
2014 |
7.2 |
6.7 |
|
2015 |
7 |
5.4 |
|
2016 |
6.9 |
5.9 |
|
2017 |
6.7 |
4.4 |
|
2018 |
6.4 |
4.0 |
|
2019 |
5.9 |
3.8 |
|
2020 |
5.7 |
4.4 |
In the past, DCI has speculated underlying explanations for this trend. Potential reasons for the downward trajectory include alternate paths for veterans post-discharge, e.g. higher education, as well as an overall decrease in unemployment rates for veterans and non-veterans alike (see far right column in Figure 1).
The rationale behind the latter theory is, as unemployment rates decrease, there are increasingly more non-veteran civilians in the workforce than there are veterans. Thus, the percentage of veterans in the civilian workforce becomes diluted when unemployment is low.
It will be interesting to see whether the downward trend for the national benchmark continues in 2021. As widely reported, unemployment rates have experienced a sharp increase since the rise of the COVID-19 pandemic. Thus, the changes in the U.S. economy and labor market this year will likely lead to a boost of the veteran benchmark when the updated figure is released this time next year.
Although it is common to adopt the national benchmark, contractors may instead opt to set their own benchmark using a combination of five factors. The information used for these five factors has also been updated recently in the VEVRAA Benchmark Database. To view the database, click here: https://www.dol.gov/agencies/ofccp/vevraa/hiring-benchmark
DCI will continue to post VEVRAA-related updates here on our blog as the focused reviews approach.
By Lily Kerr, M.S., HR Analyst at DCI Consulting Group
