Barack Obama pushes for veterans jobs programs
Communities that hire veterans to work as police and firefighters will be given preference in the grants competition.
The administration will also propose a training program designed to help veterans wanting to start their own small businesses.
With GOP lawmakers stressing the need to cut government spending, it remains to be seen how far the proposals will make it in a deeply divided Congress.
Many conservatives have in the past voted to cut spending for the COPS program, while Obama is calling for a major expansion.
Congress also has been focusing on the problem of unemployment among veterans.
A House subcommittee on Thursday examined the unemployment rate for those who serve in the National Guard or Reserves.
Witnesses estimated that about 1 out of every 5 returning guardsmen is unemployed.
Theodore Daywalt, CEO and president of a jobs board called VetJobs, told lawmakers that veterans who totally separate from the military are for the most part finding work, even in today's economic environment.
"But if a veteran remains active in the National Guard, they are having a difficult time finding meaningful employment due to the constant call-ups and deployment schedules," Daywalt said in his written testimony.
Daywalt said some employers have become wary of hiring someone who is called up for as many as 24 months at a time.
And the difficulty in finding work has led some guardsmen to volunteer for second or third deployments. He also predicted that the unemployment problem for guardsmen and reservists could get worse as the military downsizes because it will result in more competition when openings do occur.
About 160,000 troops leave active duty annually, and some 95,000 members of the National Guard and Reserves join them.
The Labor Department already operates some jobs programs to help troops with the transition to civilian life.
For example, there are employee workshops that help vets with advice on job searches and labor market conditions.
The department also provides grants to states that in turn hire workers to conduct job training workshops and reach out to employers on behalf of vets.
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