With the economic downturn taking its toll on the job market, the Labor Department this week launched a $20 million contest aimed at encouraging state workforce agencies to develop programs for displaced workers.

Among other criteria, the department is calling for proposals that promote stronger partnerships with local employers and other labor market resources.

"The programs that state workforce agencies devise will let workers vulnerable to joblessness take greater ownership of their careers," Brent Orrel, the department's assistant secretary for employment and training, said in a statement.

Organizers said proposals should fall into one of four categories, including entrepreneurship opportunities, raising educational and skill development, innovative adult learning, and preventing worker dislocations.