Status of Veterans Unemployment
Madam Chairwoman, Ranking Member, and members of the subcommittee, on behalf of Iraq and Afghanistan Veterans of America’s one hundred and eighty thousand members and supporters, I would like to thank you for allowing us to testify before your subcommittee. My name is Tim Embree and I served two tours in Iraq with the United States Marine Corps Reserves. The “Status of Veterans Employment” is a critical issue facing many Iraq and Afghanistan veterans and IAVA welcomes the opportunity to discuss this issue at length with you.
America’s newest veterans face serious employment challenges. The process of returning to civilian life is complicated by the most severe economic recession in decades. Furthermore, many Iraq and Afghanistan veterans, leaving the active-duty military, find civilian employers who do not understand the value of their skills and military experience. As a result, unemployment rates for Iraq and Afghanistan veterans are staggering. Additionally, the National Guardsmen and Reservists who leave behind their civilian lives to serve alongside active-duty troops, are inadequately protected against job discrimination. The experience of previous generations of veterans who faced similar situations suggest that today’s veterans may continue to struggle for years to come.
IAVA recommends the following to combat veterans’ unemployment:
- Fully restore funding to the ESGR, which provides critical USERRA protections for deploying Guard and Reservists. ESGR is slated to be cut 17% in FY 2011.
- Grant Post-9/11 GI Bill benefits to veterans who enroll in apprenticeships, On the Job Training, and vocational programs.
- Allow service-disabled veterans the option to use their education benefits and voc-rehab services concurrently.
- Extend the tax credit in the American Recovery and Reinvestment Act, which incentivizes hiring Iraq and Afghanistan veterans, beyond 2010.
- Increase Department of Labor VETS budget by $7.3 million for FY 2011 to improve job placement programs.
- Mandate public reporting of all VETS–100 forms (# of veterans hired by Federal contractors).
- Create civil and criminal penalties for employers who knowingly violate USERRA protections.
- Extend USERRA protections to National Guardsmen, Reservists, and servicemembers working in domestic response operations, such as hurricane or wildfire missions.
I. Status of Veterans Employment
“I have had to move my family 2-3 times in search for employment… I have had LOTS of difficulty finding employment” – IAVA Vet
Unemployment rates among new veterans have risen significantly in the last 2 years. According to the Bureau of Labor Statistics, in 2009, the average unemployment rate for Iraq and Afghanistan-era veterans was 10.2 percent. Unemployment rates from 2007 and 2008 were 6.1 percent and 7.3 percent respectively. The unemployment rate of Reserve and National Guardsmen, who often leave behind civilian jobs when they deploy, have more than quadrupled since 2007. They now rival that of veterans recently discharged from the military – 10.6 percent vs. 13.8 percent.
Disturbingly, the situation appears to be deteriorating further. According to the Bureau of Labor Statistics, in March 2010, the unemployment rate of Iraq and Afghanistan-era veterans was 14.7 percent. [i]
“All the jobs I found that would hire vets were security jobs
that pay $8 bucks an hour” –IAVA Vet
Finding a job for a returning veteran is hard, but finding quality employment is extremely difficult. Sixty-one percent of employers do not believe they have “a complete understanding of the qualifications ex-service members offer” [ii] and recently separated servicemembers with college degrees earn on average almost $10,000 less per year than their nonveteran counterparts. [iii] This wage gap could continue for decades; Vietnam veterans earned significantly less than their civilian peers till they were in their fifties.
IAVA is also concerned about the duration of new veterans’ unemployment. In 2009, 75,000 Iraq and Afghanistan-era veterans suffered from long-term unemployment—15 weeks or more. This represents more than 45 percent of all unemployed new veterans in 2009.
“First interview question was ‘Are you going to be hired and then have to leave again?’” – IAVA vet
Employers are growing increasingly wary of hiring or reemploying National Guardsmen and Reservists because of their unprecedented mobilization rates. Tens of thousands of reservists returning from combat are not being promptly reemployed or when reemployed they are not receiving the pay, pensions, health care coverage, and other benefits they are entitled to. More than 40 percent of Guardsmen and Reservists lose income when they are mobilized. [iv] Self-employed reservists are suffering 55 percent earnings losses when they are activated.
II. Existing Programs
Federal veterans’ employment services can be categorized into one of three types of programs: job training, job placement and job protection. A proper balance of attention and resources must be dedicated to each category to ensure our nation’s veterans can successfully return to work.
A. Job Training Programs
GI Bill Benefits
“After approximately 30 interviews and temporary positions
I chose to attend school under the new GI Bill.” –IAVA Vet
The new GI Bill is the greatest investment in veterans and their families since World War II and it couldn’t have come at a better time. Veterans, facing tough economic times and high unemployment numbers, are flocking to universities across the nation, making themselves more marketable on the job front. The Post-9/11 GI Bill has enabled over 230,000 students to attend first-rate colleges and universities.
“This was a huge disappointment to me when I found out my schooling was not covered under the new GI Bill… I am a mechanic by vocation, there are no 4-year degree programs for people like me.” –IAVA Vet
Unfortunately, a significant number of veterans have been short-changed under the new GI Bill. Apprenticeships, On-the-Job-Training and vocational programs are excluded from the new GI Bill. IAVA believes the Post-9/11 GI Bill should be extended to veterans enrolled in these highly beneficial programs.
Non-degree granting schools, or vocational schools, are specifically excluded from the new GI Bill and no provision was made for Apprenticeship and On-the-Job-Training (OJT) programs. Both types of programs were covered under the old GI Bill. Oddly, a veteran can still use their new GI Bill to obtain a vocational certificate just not at a vocational school.
Veterans pursuing vocational training should not be penalized for going to a strictly vocational school. The WWII GI Bill sent over 8 million veterans to school. More than half of those veterans were not seeking a college degree; they participated in some type of vocational training program. Unfortunately, nearly 16,000 modern veterans pursuing vocational training will not be able to access the new GI Bill.
Vocational Rehabilitation and Employment Services (Voc-Rehab)
The Voc-Rehab program offers individual rehabilitation programs for disabled veterans with an emphasis on employment counseling and services, as well as assistance finding a job. For severely disabled veterans, unable to return to work, the program gives them the tools to live as independently as possible. Participants who complete the rehabilitation earn on average six times what they did before the program. [vi] Over 110,000 veterans participated in FY2009 [vii]; double the number of veterans who participated in FY2003.
Unfortunately, only a small percentage of veterans who enroll in Voc-Rehab successfully complete the program. [viii] And according to a 2004 VA Voc-Rehab Task Force, the type and timeliness of its employment services are “out of sync” with the 21st century labor market and attitudes towards persons with disabilities. [ix] For example, to use Voc-Rehab to pay for college, veterans must convince Voc-Rehab counselors that they are actually smart enough to succeed at the college of their choice. We have heard countless anecdotal stories where this process has pitted a disabled veteran against their counselor when the veteran wants to challenge themselves at a tougher school.
We believe that by breaking down the bureaucratic wall between the new GI Bill and vocational rehabilitation and by allowing service-disabled veterans the option to use their GI Bill benefits and vocational rehabilitation services concurrently, disabled veterans will have access to quality rehabilitative services without the hassle of proving their mental acuity.
Transition Assistance Program/ Disabled Transition Assistance Programs (TAP & DTAP)
Servicemembers approaching separation can take advantage of the Transition Assistance Program (TAP), which provides employment and training information as well as a variety of counseling programs. The Departments of Defense, Veterans Affairs, Transportation, and Labor partner to conduct the three-day workshops where servicemembers learn interview skills, tips for job searches, and how to prepare civilian resumes and cover letters. The program has shown some effectiveness; servicemembers who participate in TAP find their first post-military job three weeks faster, according to DOL. [x]
Regrettably, utilization of TAP is low. The Marine Corps is the only branch of service that requires its members to sign up for TAP briefings but attendance is still not mandatory. The DOD has established a goal of 85 percent participation across the services [xi], yet only 60-65 percent of all separating active-duty servicemembers attend the TAP employment seminars. [xii] In the National Guard and Reserves, the usage rates are even lower: only 30 percent of all separating Reservists or National Guardsmen attend some portion of TAP. [xiii] In addition, all aspects of TAP are not always available and the time constraints of troops’ demobilization process can also make attending a TAP session difficult, if it is available at all. [xiv] To encourage greater participation, the DOD launched TurboTap.org in 2007. The Defense Department website allows active-duty and reserve servicemembers access to transition resources on their own time, including information on military and VA benefits and employment assistance.
“Once I learned how to translate my skills into civilian-speak, I found I was in high demand and very competitive for several good positions.” –IAVA vet
While IAVA is happy to see that the President’s budget request for FY 2011 is asking for a 14% increase in funding for TAP trainings, we believe that we must modernize TAP and universally require the civilian employment training to ensure every separating veteran has the skills they need to secure meaningful employment. There is no commonly accepted translation of military certifications, training and experience to their civilian counterparts. For example, Navy Corpsmen and Army medics are performing difficult medical procedures under unimaginable conditions but they do not qualify for employment in a similar medical field once they transition to the civilian world. To improve the TAP courses a study should be commissioned that will report recommendations to Congress on the differences between DOD and civilian vocational certifications and licenses to ease the transition of certifications into the civilian world.
B. Job Placement
The American Recovery and Reinvestment Act, commonly known as the “Stimulus bill,” authorized a two year tax credit for employers who hire unemployed Iraq and Afghanistan-era veterans. This tax credit of up to $2,400 per unemployed veteran was created to incentivize employers to hire veterans who were taking the brunt of the unemployment blight.
“Many employers say they 'value Veterans', but sometimes it's just about the bottom line. Providing monetary or tax incentives may make employers think more about employing Veterans” – IAVA Vet
IAVA and many other veterans organizations lauded this tax credit when it passed. We believe that this tax credit should be extended indefinitely. Given the current state of the economy and the fact the other groups, such as ex-felons, are permanently eligible for the same tax credit it is the right thing to do.
“My employer knew nothing about tax benefit for hiring disabled vet
until after I was hired.” – IAVA Vet
The unemployed veteran tax credit is accompanied by a permanent tax credit for the hiring of disabled veterans, worth up to $4,800 per disabled veteran. However, the VA and the Department of Labor VETS program have done a poor job advertising either of these tax credits to potential employers and job seeking veterans. A tax credit designed to spur the hiring of veterans that no one knows about is ineffective and can lead to frustration and misunderstanding between veterans and the business community. IAVA believes that there needs to be a coordinated outreach effort by the VA and Department of Labor to educate employers and veterans about this helpful benefit.
Department of Labor Veterans’ Employment and Training Services
Low-income, homeless, or disabled veterans can turn to the Department of Labor’s Veterans’ Employment and Training Service (VETS). The VETS program provides grants to state and local agencies to provide services, such as training, licensing and certification, one-on-one employment counseling, and support services. These programs helped over 850,000 veterans last year. [xv] Other grants fund representatives to work with employers and human resources personnel to increase employment opportunities for veterans.
“New York State has a good department of labor in helping vet's find jobs” –IAVA Vet
IAVA is concerned that while the President’s request for the VETS budget contains a modest increase in funding (2.4%), none of this increase will be spent on improving or expanding veterans job placement programs. We are also concerned that some VETS programs may not be correctly measuring or reporting their effectiveness as reported by the Government Accountability Office. [xvi] In some states, VETS programs are either understaffed or splitting their time between serving veterans and nonveterans. IAVA concurs with this committee’s minority views and believes the DOL VETS program should have their funding increased by an additional $7.3 million. [xvii] This funding would used to train veteran employment specialists and improve federal oversight of these programs.
Federal Hiring: Veterans Preference
The Federal Government hires three times the percentage of veterans as the private sector [xviii] and therefore plays a critical role in combating veterans’ unemployment. Last November President Obama issued an executive order outlining the Veterans Employment Initiative. [xix] This order required enhanced recruitment and promotion of employment opportunities for veteran within the Federal government and established a Council on Veterans Employment. The Federal government has already stood up a website, www.fedshirevets.gov and released a strategic plan to implement this goal of increasing the number of veterans working in the Federal government.
“I searched usajobs.gov, submitted applications but never heard from them. I guess there is a magic way to write your job description.” –IAVA Vet
IAVA is highly encouraged to see the speed and thoroughness of this Council in addressing these employment issues. We believe that their website is well organized and extremely helpful to job seeking veterans. However, it still lacks a clear explanation of what the 5 or 10 point veteran preference actually means in terms of the federal hiring process and the job bank is just a link to usajobs.gov. The Council’s strategic plan lays out a clear and ambitious set of goals and we believe that it will take both the Executive and Legislative branch working together to ensure that these goals are implemented all the way down to the GS-11 Human Resources Specialist responsible for hiring the veterans in each agency.
“I ended up getting a job with a company that is contracted out by the government and is unionized. So everyone is understandable and supports my actions with the military.” – IAVA Vet
The Federal Government is the world’s largest buyer of goods and services, with purchases totaling over $425 billion each year. With this level of spending the Federal Government can leverage its purchasing power to require potential contractors to increase veterans hiring. Current federal law mandates federal contracts over $100,000 “take affirmative action to employ” veterans. [xxi] These contractors are required to publish job openings with the state job banks and to annually report the number of veterans they have retained by submitting a VETS-100 form to the Department of Labor. These contractors are also prohibited from discriminating against veterans.
Unfortunately, the data collected from VETS-100 forms is aggregated and only partially published in the DOL VETS annual report. IAVA believes that these forms should be publically reported, allowing interested parties to review whether contractors are actually following through on these contracting mandates. The hope is that the public disclosure of these forms will create a healthy competition between contractors on which contractor hired more veterans. IAVA would love to see Boeing and Lockheed Martin making these statistics part of their bids for the next big defense contract.
Failure to comply with established contracting requirements can lead to the suspension or disbarment of that contractor from receiving future contracts. IAVA believes violations of USERRA protections should also be included as grounds for suspension or disbarment.
Finally, IAVA was troubled to learn the Troubled Asset Relief Program (TARP), authorizing up to $770 billion to bailout banks, exempted banks receiving federal bailouts from veterans hiring requirements, while protections for minorities, women and disabled individuals were still included. IAVA believes that TARP should be amended to force compliance with veterans’ preference rules and that all future stimulus programs should not overlook veterans hiring preferences.
Small Business Help
Many veterans have chosen self-employment over unemployment by starting their own small business ventures. Veterans represent 14.5% of small business owners nationally. [xxii] For reservist and veteran business owners looking for technical or financial assistance, support is available through the Small Business Administration (SBA) and the Department of Veterans Affairs.
Last year, the SBA assisted more than 180,000 veterans, reservists, active servicemembers and spouses through its entrepreneurial counseling and training services. [xxiii] The agency offers low-interest capital through the new Patriot Express Pilot Loan program. The SBA Office of Veterans Business Development also operates five veteran-specific business outreach centers and provides federal contracting assistance to veterans, although it has relatively limited resources to do so.
In addition, the SBA has teamed up with the VA and the International Franchise Association to create the Veterans Transition Franchise Initiative, which offers 30 percent off franchising fees for veterans.
Veterans can also turn to the VA’s Center for Veterans Enterprise (CVE) for assistance with starting or expanding their businesses. However, since this committee recently held a hearing on this particular issue we would like to associate our comments with the testimony of Joe Sharpe, from the American Legion when he concluded, “The implementation of CVE is small and does not necessarily provide the right assistance to veterans. The Vetbiz.gov website is not easily navigated and needs to become a more user-friendly website.”
“During my deployment I had to totally shutter the doors on my construction business. It put my family in a very difficult position” – IAVA Vet
IAVA believes that the VA must work to mitigate the effect of frequent and lengthy deployments by providing small businesses owners in the National Guard and Reserves with additional access to capital, insurance, and bonding via the VA’s Center for Veterans Enterprise. The Center for Veterans Enterprise should receive appropriate funding and resources to achieve this goal.
We would be remiss to omit several other veterans’ jobs programs that exist such as www.vetsuccess.gov, www.warriorgateway.org and Helmets to Hardhats. The VA has extensively briefed IAVA on their new job search website for veterans and more specifically disabled veterans. We applaud the VA for reaching out to potential employers and recruiting them to participate. However, we believe that vetsuccess.gov should be integrated with www.fedshirevets.gov and expanded for all veterans creating a single jobs for veterans portal. Warrior Gateway was created by the Business Executives for National Security at the request of the Chairman of the Joint Chiefs of Staff Admiral Mike Mullen to assist OIF and OEF veterans navigate the government agencies and non-profits serving veterans. Helmets to Hardhats is a Department of Defense funded initiative to place separating servicemembers in skilled labor positions and we have heard very good feedback from our members about this program.
C. Job Protections
Although National Guardsmen and Reservists are legally protected under the Uniformed Services Employment and Reemployment Rights Act (USERRA), many troops still experience employment discrimination because of their military service.
“I can offer no quotes, smoking guns, or neon signs stating that ‘reservists’ need not apply, but I have heard the tone of an interviewer become cold the instant the ‘reserves’ comes up in the conversation.” – IAVA Vet
Among National Guardsmen and Reservists who have served since September 11, 2001, “Nearly 11,000 were denied prompt reemployment;” [xxiv] “More than 22,000 lost seniority and thus pay and other benefits;” [xxv] “Nearly 20,000 saw their pensions cut;” [xxvi] and “Nearly 11,000 didn’t get their health insurance back.” [xxvii]
The Employer Support of the Guard and Reserve (ESGR) is the single best resource for educating employers and veterans on USERRA rights and for resolving USERRA issues quickly and informally. However, the President’s budget request for FY 2011 plans to slash the ESGR budget by nearly 17%, this will effectively cripple this great asset. These cuts could not have come at a worse time with the rising number of USERRA violations and the fact that of the tens of thousands of reserve component troops who have suffered this discrimination, approximately three-quarters of them do not seek assistance.32
A common reason veterans are not seeking help is the lack of familiarity with USERRA protections and obligations. Twenty-eight percent of reservists report not receiving information on USERRA/reemployment rights during activation or deactivation.33 More than a third of employers surveyed by Military.com were unaware that USERRA regulations required them to give a returning veteran the same or an equivalent job.34 IAVA believes that the ESGR must be fully funded, not cut by 17% in FY 2011. We also believe that DOD should implement an extensive notification program for servicemembers’ employers specifically informing them of their USERRA obligations.
“Even though I was hired back right away I lost 3 years of raises and my company doesn’t trust me because they are scared I will be deployed again” – IAVA Vet
We believe that USERRA must be modernized and strengthened to handle the historic levels of deployments of the National Guard and Reserves. We believe this can be done by:
- Creating civil and criminal penalties for employers who knowingly violate USERRA protections.;
- Granting servicemembers their day in court, as intended by the original USERRA statute by making USERRA complaints exempt from predispute binding arbitration agreements;
- Preventing employers from firing an employee while a USERRA claim is being processed, by requiring courts hearing USERRA complaints to utilize their full range of legal powers, including injunctions when appropriate; and
- Protect Reservists and Guardsmen from termination, loss of seniority and loss of sick and vacation time from their civilian jobs while they receive DOD medical treatment for injuries the servicemember sustained in the uniformed services.
USERRA compliance is also not uniform across the board. Some federal and state employees do not enjoy the same level of protection under USERRA as employees in the private sector. Astonishingly, National Guardsmen and Reservists serving in domestic disaster response situations are not eligible for USERRA protections at all. IAVA recommends extending USERRA protections to National Guardsmen, Reservists, and to servicemembers working in domestic response operations such as hurricane or wildfire missions and holding federal and state governments to the same standards of USERRA compliance as private sector employers.
Department of Labor VETS
Mobilizations have put a strain on businesses, and especially small businesses, that employ reservists.52 Employers often struggle to maintain their workforce and keep their businesses afloat while their reservist employees are called up for multiple tours, often with little notice and without a clearly-defined length of absence. For some businesses, the cost to train their replacements can be steep. According to Dave Miller, vice president of a national trucking firm with approximately 50 employees deployed, the company is spending up to $100,000 to train each replacement.53
IAVA recommends offering tax credits for employers who, when their reserve component employees are called to active-duty for over 90 days, continue to support their employees by paying the difference between the servicemembers’ civilian salary and their military wages. Furthermore, tax credits should be provided to businesses that provide additional training for returning Reservists and National Guard members to bring them up to same level of training as their non-veteran peers.
[i] Bureau of Labor Statistics, “Employment Situation Summary: March 2010,” April 2, 2010, Table A-5: http://www.bls.gov/news.release/empsit.nr0.htm.
[ii] Military.com, “Military.com Study Reveals Profound Disconnect between Employers and Transitioning Military Personnel,” November 5, 2007: http://www.military.com/aboutus/twocolumn/0,15929,PRarticle110507,00.html.
[iii] Abt. Associates, Inc. “Employment Histories Report, Final Compilation Report,” March 24, 2008: http://www1.va.gov/vetdata/docs/Employment_History_080324.pdf.
[iv] “41 percent of drilling unit members reported income loss [when mobilized for a contingency operation].” GAO-03-573T, “Military Personnel: Preliminary Observations Related to Income, Benefits, and Employer Support for Reservists During Mobilization.” March 19, 2003: http://www.gao.gov/new.items/d03549t.pdf.
[v] Spring 2010 GI Bill Benefit Processing, http://gibill.va.gov/spring2010.htm
[vi] Department of Veterans Affairs, Office of Policy and Planning, “Women Veterans: Past, Present and Future,” September 2007, p. 19-20: http://www1.va.gov/womenvet/docs/WomenVet_History.pdf.
[vii] Department of Veterans Affairs, Annual Benefits Report FY 2009, (Page 67), http://www.vba.va.gov/REPORTS/abr/2009_abr.pdf
[viii] “Despite the tens of thousands of VR&E program participants in a given year, the number of veterans rehabilitated by obtaining a job or achieving independent living goals averages only about 10,000 a year.”VA Vocational Rehabilitation and Employment Task Force, “Report to the Secretary of Veterans Affairs: The Vocational Rehabilitation and Employment Program for the 21st Century Veteran,” 2004, p. 4: http://www1.va.gov/op3/docs/VRE_Report.pdf.
[ix] Ibid., at 5.
[x] Gerry Gilmore, “Pentagon Improves Services for Transitioning Servicemembers, Families,” American Forces Press Service, May 19, 2008: http://www.defenselink.mil/news/newsarticle.aspx?id=49927.
[xi] Joseph C. Sharpe, Jr., Deputy Director of the American Legion National Economic Commission, Testimony before the United States House of Representatives Committee on Veterans’ Affairs, “U.S. Department of Veterans Affairs/U.S. Department of Defense Cooperation in Reintegration of National Guard and Reserve,” June 24, 2008: http://veterans.house.gov/hearings/Testimony.aspx?TID=32446&Newsid=260&N....
[xiii] Women Veterans in Transition Pilot Research Study by Business and Professional Women’s Foundation, “Building Strong Programs and Policies to Support Women Veterans,” p. 2: http://www.bpwusa.org/i4a/pages/index.cfm?pageid=5383.
[xiv] Department of Labor, “Employment Situation of Veterans: 2007,” April 10, 2008, p. 3: http://www.bls.gov/news.release/pdf/vet.pdf.
[xv] U.S. Department of Labor, “Budget in Brief FY 2011”, page 76, http://www.dol.gov/dol/budget/2011/PDF/bib.pdf
[xvi] GAO-07-594, “Veterans’ Employment and Training Service: Labor Could Improve Information on Reemployment Services, Outcomes, and Program Impact,” May 2007: http://www.gao.gov/new.items/d07594.pdf.
[xvii] House of Veterans Affairs Committee Minority, Views and Estimates for FY 2011, page 9, http://republicans.veterans.house.gov/documents/FY2011RepublicanVandE.pdf
[xviii] Office of Personal Management, “The Governmentwide Veterans’ Recruitment and Employment Strategic Plan for FY 2010-FY2012,” page 2, http://www.fedshirevets.gov/pdf/Vets_Initiative_Strategic_Plan.pdf
[xix] Executive Order, President Obama, November 9th, 2009, http://www.whitehouse.gov/the-press-office/executive-order-veterans-empl...
[xxi] 38 U.S.C. 4212
[xxii] Characteristics of Veteran Business Owners and Veteran-owned Businesses Chapter 5 of The Small Business Economy for Data Year 2006, A Report to the President, http://www.sba.gov/advo/research/sbe_07_ch5.pdf
[xxiii] Small Business Administration, FY 2009 Performance Report, page 66, http://www.sba.gov/idc/groups/public/documents/sba_homepage/fy_2011_cbj_...
[xxiv] United States Senate Health, Education, Labor and Pensions Committee, “Kennedy Holds Hearing on Veterans’ Employment Issues,” November 8, 2007: http://help.senate.gov/Maj_press/2007_11_08_b.pdf.
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