Full text of "National defense migration. Hearings before the Select Committee Investigating National Defense Migration, House of Representatives, Seventy-seventh Congress, first[-second] session, pursuant to H. Res. 113, a resolution to inquire further into the interstate migration of citizens, emphasizing the present and potential consequences of the migraion caused by the national defense program. pt. 11-[34]"

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NATIONAL DEFENSE MIGRATION

HEARINGS

BEFOBB THS

SELECT COMMITTEE INYESTIGATING

NATIONAL DEFENSE MIGRATION

HOUSE OF EEPBESENTATIVES

SEVENTY-SEVENTH CONGRESS

FIHST SESSION '

PURSUANT TO

H. Res. 113

A RESOLUTION TO INQUIRE FURTHER INTO THE INTERSTATE
MIGRATION OF CITIZENS, EMPHASIZING THE PRESENT
AND POTENTIAL CONSEQUENCES OF THE MIGRA-
TION CAUSED BY THE NATIONAL-
DEFENSE PROGRAM

PART 16
WASHINGTON HEARINGS

JULY 15, 16, AND 17, 1941

Printed for the use of the Select Committee Investigating
National Defense Migration

NATIONAL DEFENSE MIGRATION

HEARINGS

BEFORE TflE

SELECT COMMITTEE INVESTIGATING

NATIONAL DEFENSE MIGRATION

HOUSE OF EEPEESENTATIVES

SEVENTY-SEVENTH CONGRESS

FIRST SESSION
PURSUANT TO

H. Res. 113

A RESOLUTION TO INQUIRE FURTHER INTO THE INTERSTATE
MIGRATION OF CITIZENS, EMPHASIZING THE PRESENT
AND POTENTIAL CONSEQUENCES OF THE MIGRA-
TION CAUSED BY THE NATIONAL-
DEFENSE PROGRAM

PART 16
WASHINGTON HEARINGS

JULY 15, 16, AND 17, 1941

Printed for the use of the Select Committee Investigating
National Defense Migration

UNITED STATES

GOVERNMENT PRINTING OFFICE

WASHINGTON : 1941

OCT 31 19*'

SELECT COMMITTEE INVESTIGATING NATIONAL DEFENSE
MIGRATION

JOHN H. TOLAN, California, Chairman

JOHN J. SPARKMAN. Alabama CARL T. CURTIS, Nebraska

LAURENCE F. ARNOLD, Illinois FRANK C. OSMERS, Jr., New Jersey

Robert K. Lamb, Staff Director

Mary Dublin, Coordinator of Hearings

John W. Abbott, Chief Field Iniestigator

[arold D. Cullen, Associate Editor
Josef Berger, Associate Editor

CONTENTS

Jr'age

List of witnesses v

Tuesday, July 15, 1941, morning session 6309

Testimony of Sidney Hillman 6309, 6393

Statement by Sidney Hillman 6310

Testimony of Robert L. Mehornay 6409

Tuesday, July 15, 1941, afternoon session 6413

Testimony of William Green 6413, 6454

Statement by William Green 6414

Supplementary statement by William Green 6443

Wednesday, July 16, 1941 6481

Testimony of Corrington Gill 6481, 6508

Statement by Corrington Gill 6486

Testimony of H. F. Alves 6518, 6522

Statement bv H. F. Alves 6519

Testimony of Robert C. Weaver 6529, 6536

Statement by Robert C. Weaver 6530

Testimony of M . Clifford Townsend 6545, 6563

Statement bv M. Clifford Townsend 6545

Thursday, July 17, 1941 . 6575

Testimony of Donald M. Nelson 6575, 6605

Statement by Donald M. Nelson 6576

Testimony of Leon Henderson 6620, 6635, 6666

Statement by Leon Henderson 6620

Memorandum by Leon Henderson 6654

Index 6673

LIST OF WITNESSES

Washington Hearings, July 15, 16, 17, 1941

Page

Alvep, H. F., senior specialist in State school administration, United States

Office of Education, Federal Security Agency, Washington, D. C-- 6518, 6522

Gill, Corrington, assistant commissioner. Work Projects Administration,

Federal Works Agency, Washington, D. C 6481,6508

Green, William, president, American Federation of Labor, Washington,

D. C 6413,6454

Henderson, Leon, administrator. Office of Price Administration and Civil-
ian Supply, Washington, D. C 6620, 6635, 6666

Hillman, Sidney, associate director general. Office of Production Manage-
ment, Washington, D. C 6309, 6393

Mehornay, chief of Defense Contract Service, Production Division, Office

of Production Management, Washington, D. C 6409

Nelson, Donald M., director. Division of Purchases, Office of Production

Management, Washington, D. C 6575,6605

Townsend, M. Clifford, director, Office of Defense Relations, Department
of Agriculture, and member of Plant-Site Committee, Office of Produc-
tion Management, Washington, D. C 6545, 6563

Weaver, Dr. Robert C, chief, Negro Employment and Training Branch,
Labor Division, Office of Production Management, Washington,
D. C 6529,6536

NATIONAL DEFENSE MIGRATION

TUESDAY, JULY 15, 1941

House of Representatives,
Select Committee Investigating

National Defense Migration,

Washington, D. C.
The committee met at 10 a. m., pm-siiant to notice, Hon.. John H.
Tolan (chaiiman) presiding.

Present were: Representatives John H. Tohm (chairman), of Cali-
fornia; John J. Sparkman, of Alabama; Laurence F. Arnold, of
Ilhnois; Carl T. Curtis, of Nebraska; and Frank C. Osmers, Jr., of
New Jersey.

Also present were: Robert K. Lamb, staff director; Mary Dublin,
coordinator of hearings; and John W. Abbott, chief field investigator.
The Chairman. The committee will please come to order.
Mr. Reporter, the first witness will be Mr. Sidney Hillman, Asso-
ciate Director General, Office of Production Management.

TESTIMONY OF SIDNEY HILLMAN, ASSOCIATE DIRECTOR GEN-
ERAL, OFFICE OF PRODUCTION MANAGEMENT, WASHINGTON,
D. C.

The Chairman. Mr. Hillman, I have read your paper and I think
it is a very valuable contribution.

May I say to you, although you probably already know, this com-
mittee was appointed last year to investigate the general migration
of destitute citizens between States. We held hearings throughout
the country, and we made our report to Congress. Following that,
Congress saw fit to continue the committee to serve during this ses-
sion on account of the migration caused by our nationa^defense
program.

We have recently held hearings in San Diego, Calif. ; we have been
to Hartford, Conn., Trenton, N. J., and Baltimore, Md. I am
making this statement so you may know the scope of our study.

Congressman Sparkman will interrogate you, Mr. Hillman.

Mr. Sparkman. Mr. Hillman, I have some questions which were
sketched out before I had access to your statement. I imagine most
of them you have answered in the statement but some of them may
not have been answered.

Mr. Hillman. Mr. Sparkman, of course the statement itself is a
summary and if agreeable to you I would like to read it and then be
interrogated on it or I will adjust myself to your requirements. Of
course the material is covered pretty well in summaiy form here and
if you have no objection I would like to read it to the committee.

Mr. Sparkman. You mav go right ahead.

6309

g310 WASHINGTON HEARINGS

STATEMENT BY SIDNEY HILLMAN, ASSOCIATE DIRECTOR GEN-
ERAL, OFFICE OF PRODUCTION MANAGEMENT, WASHINGTON,
D. C.

Mr. HiLLMAN (reading). May I say, Mr. Chairman, that I welcome
the opportunity to appear before yom- committee. We in the O. P. M.
have great responsibihties to plan and carry through the defense
program as far as production is concerned, and it is our responsibility
to carry it through in a way that will give us the utmost for national
defense and not create too many social problems whUe we are doing
it, and any time we have the opportunity to appear before a com-
mittee I consider it as part of our work.

We cannot always explain to the country in all detail what we are
doing. I sincerely believe, Mr. Chairman and members of the com-
mittee, that this planning for our labor supply that we have tried to
do is a very far-reaching job and as a result of it we find conditions
are not altogether satisfactory, but I think they are quite satisfactory
from the point of view of national defense.

You requested me to supply your committee with statistical data
and reports on several topics comiected with the problem of labor
migration in defense industries, and to summarize this material in my
testimony. At the outset, I should like to make clear that I am not
here seeking to deal with the orderly planned movement of labor to
newly developed defense plants, and the like, but rather with the
problem of the unplanned disorderly migration of men searching for
work, from city to city.

Of course we are putting up new plants and part of our program is
to distribute the load as much as possible tlu'oughout the Nation, and
of course it requires skilled labor in order that these plants can be
properly started going.

With your permission I shaF first make a statement on the subject
matter under consideration, and then present each document or set of
documents at the proper point. This will enable me at one and the
same time to provide the committee with the requested details, and
to explain the attitude of O. P. M. toward this basic issue of labor
migration, as well as to outline the methods by which we are striving
to cope with it.

DEFENSE MIGRATION, 1940-41, CONTRASTED WITH 1916-17

As your committee recognizes, a condition of large-scale labor
migration is not only a tremendous question in itself, but it is also
of vital importance to that national morale which lies at the center
of our defense-production problem. That is why I hope sincerely
that some of the material which I am subihittmg at your request
will be of some value in helping you to cope effectively with this
crucial question of labor migration.

We may take it for granted that the worker does not ordinarily
pull up stakes and leave home, whether with his family or alone,
unless there are conditions which prompt or indeed compel him to
do so. Fortunately, there has not yet been any large-scale migration
of labor, with its resultant chaos, during this first year of the defense
effort, comparable to that which took place in the defense production
of the World War. And furthermore, as the months have passed,
the information which reaches me indicates that the tendency of

NATIONAL DEFENSP: MIGRATION 6311

labor to migrate has not increased in any degree commensurate with
the expansion of defense output, which as you know has multiplied
during these months in all 18 of the major defense mdustries, in
addition to the expansion in consumer-goods mdustries as well. In
fact, while it is impossible to obtam exact figures of the total amount
of labor migration, it is my impression that instead of mcreasiiig in
these latest months, it has actually been reduced. This does not
mean, however, that migration has been elimmated, or that it has
ceased to be a cause for grave concern.

EFFECTS OF UNCONTROLLED MIGRATION

I need hardly explain why we are eager to keep labor migration to
a minimum, and to keep under control whatever relocation of workers
must occur. A disorderly labor situation means high turn-over in the
plants, and this is both costly to industry and injurious to efficient
production. Plants that have an adequate and well-established labor
force should not have that force disrupted by the pirating practices
of other plants. Again, an uncontrolled inflow of migratory workers
into communities alreadj^ glutted with defense workers is bound to
create serious housing shortages, rising rents, and in some cases
health and social problems besides. Finally, those communities and
areas from which labor migration proceeds are bound to suft'er serious
loss both in their normal civilian pursuits and a further loss in case the
communities should later be incorporated into the defense effort. For
all these reasons, it has been the policy of the Labor Division from
the beginning that every worker should, if possible, be employed
locally, be trained locally, and be brought into the defense effort locally^
Some of the methods by which we have sought to achieve this objec-
tive, I shall explain as I proceed. Meanwhile, let me point to some
considerations that have contributed to the difficulty of the task.

CONTRACT AWARDS AS FACTOR IN MIGRATION

We may accept it as a fundamental principle that sharp contrasts
in employment opportunities and conditions, within various regions,
tend to create worker migration. Labor tends to migrate from those
sections where such opportunity is less, to those points where oppor-
tunity exists or is reported to exist. The defense effort began at a
time when there was a great deal of unemployment, when there was
already a considerable amount of migratioTi going on. From the first
days of the National Defense Advisory Commission, the Labor
Division foresaw the possibility that the award of defense contracts
would lead to a stampede of unemployed workers toward defense
areas. Naturally, this is an important factor in labor migration. I
understand, however, that Mr. Donald Nelson, Director of Purchases
for O. P. M., is to discuss this point at length before this committee.
Suffice it to say, however, that the Labor Division from its inception
has urged that contracts be equitably distributed and that they be
placed in areas where idle men and idle machines were to be found.

MAGNITUDE OF THE DEFENSE EFFORT

Another underlying cause of labor migration is the size of the defense
effort itself. The current increase in employment is taking place not

6312 WASHINGTON HEARINGS

only in the defense industries, but also in various other industries
affected by the growth of consumer purchasing power. The Bureau of
Labor Statistics estimates that the next 12 months up to and including
June 1942 will see a total increase in nonagri cultural employment of
between 2}^ and 3^ million persons. For the defense contracts in force
in the manufacture of aircraft, vessels, machine tools, ordnance, and
other defense items, the Bureau of Labor Statistics estimates that
betvv^een April 1941 and April 1942 approximately 1,400,000 addi-
tional workers will be required. Shipbuilding will require some
323,000 additional workers, aircraft 408,000, ordnance and machine
tools 291,000, and construction and other defense industries 384,000.
Some of these will be drawn from nondefense industries and some will
be newly employed.

I herewith, therefore, submit the detailed data supplied to me by the
Bureau of Labor Statistics, in response to Chairman Tolan's first
request, for "the labor requirements of the various national-defense
industries now estimated as necessary for the next 2 years." The
Bureau has made a very full statement of requirements by skills, by
industries, and by regions, up to April 1942. Estimates beyond next
April are more general, inasmuch as it is difficult to say at this time
how far the defense effort will extend.

May I insert this in the record as Exhibit A?

The Chairman. It will be received.

(The document referred to follows:)

Exhibit A. — Estimated Increase in Over-All Nonagricultural Employment

Estimates made by the Bureau of Labor Statistics point to an increase in civilian
nonagricultural employment of roughly 2J/^ million to 3 million persons in the next
12 months. This may be viewed as the probable maximum increase now in sight
for that period. The forecast is not projected beyond June 1942 because of the
many imponderables in the industrial situation. But within the next year it is
not likely that any upward revisions of the present defense program will result
in a much greater increase in total employment than indicated, since any material
increase in defense production over present schedules during the coming year
will probably require offsetting reductions in nondefense production and employ-
ment. The level of employment beyond next June depends upon the steps taken
in the period immediately ahead to expand industrial capacity. Hence, no reliable
estimate of the employment outlook can now be made for a period of more than a
year ahead.

Except for capacity limitations and other restrictive factors, the defense pro-
gram as now scheduled, coupled with expanding consumer demand and private
investment, might be expected to result in a gross national product of about
$105,000,000,000 for calendar year 1941, or a net national income of about
$92,000,000,000. Actually, on the basis of productive activity in the first half
of 1941, it seems probable that gross national product will not total more than
$98,000,000,000 this year, with national income at about $86,000,000,000. Limi-
tations of basic raw material supplies, in conjunction with fiscal measures designed
to restrict civilian consumption, are likely to restrict gross national product to an
annual rate of about $106,000,000,000 in the second quarter of 1942.

Under these assumptions we should expect the Federal Reserve Board index
of industrial production to rise from an average of 149 in the second quarter of
1941 to 171 in the second quarter of 1942. The total number of employees in
nonagricultural establishments would rise from 32 to 34.5 million, an increase of
2.5 million. This estimate allows for decreases in employment in the production
of automobiles and other consumer durables. The attached table indicates the
anticipated levels of employment for each quarter during the period covered by
the forecast.

NATIONAL DEFENSE MIGRATION g313

Expansion of basic facilities might make possible an increase somewhat larger
than the estimate indicates, possibly by as much as another half-million workers.
This applies primarily to the second quarter of 1942; the forecasts for the interven-
ing periods could not be materially affected by any expansion of facilities which
might be undertaken at the present time. Prompt action now to expand raw
materia] supplies, manufacturing facilities, power supply, and railroad equipment
would make possible considerable expansion during the last half of 1942 and in
the following year.

ESTIMATED DEFENSE-LABOR REQUIREMENTS

While no regional break-down has yet been made of the estimated increase in
over-all nonagricultural employment, it is possible to be more specific in stating
the increases in the labor force which will be required to maintain delivery sched-
ules on contracts let for a major portion of the coming year's defense production.
The Bureau of Labor Statistics has estimated that between April 1941 and April
1942 approximately 1,400,000 additional workers will be required in the manu-
facture of aircraft, vessels, machine tools, ordnance, and other defense items for
which contracts are in force, certificates of necessity issued, or loans made, for
the construction of new or expanded defense manufacturing facilities. The
attached memorandum (Defense Labor Requirements) shows labor requirements
by occupations and principal geographical regions, where production facilities are
located. The estimates cover final assembly and subassembly of ships, aircraft,
machine tools, ordnance, and certain other defense items. In addition, they em-
brace the operating labor requirements of new facilities for the production of parts
and materials such as steel, aluminum, and magnesium.

The increase in the labor required over the year is divided among specified
lines of defense manufacture as follows:

Shipbuilding 323,900

Aircraft 408,441

Ordnance and machine tools 291, 611

Other 384,629

Total 1,408,581

In each of the first 3 items are included estimates of labor required on sub-
assemblies and parts. A large number of certificates of necessity have been
granted to establishments producing parts for a variety of final defense uses where
it is impossible to classify the establishment. These are carried in the category
of "other" defense work, as is the labor required in the new steel, aluminum, and
magnesium plants. Most of the additional 1,400,000 workers will be new em-
ployees, though some of them will be drawn from nondefense to defense employ-
ment in the establishments covered by the estimate.

To date, defense production has been accomplished without substantial diver-
sion of labor from civilian production to defense production, while at the same
time manpower has been diverted to the armed forces. In general, employment
in all lines has expanded. However, it is apparent that an "all-out" defense effort
will necessitate the curtailment of output in many nondefense lines and will re-
quire the transfer of many workers now employed in nondefense activities to
defense production.

The decrease in unemployment will be somewhat less than the increase in em-
ployment, plus expansion of the armed forces. In the first place there is a normal
net increase in the labor force of somewhat more than 600,000 a year. In the
second place individuals will be drawn into the labor market who do not usually
work; youngsters will leave school, wives will take jobs, and skilled workers who
have retired will return to jobs. In any event, it is important to point out that
by the middle of 1942, despite an increase of approximately 6,000,000 persons in
nonagricultural employment since the beginning of the defense effort, there will
still be substantial unemployment in the cities in addition to a substantial reser-
voir on farms of workers who could be drawn into nonagricultural employment,
and of women not now in the labor market, but potentially available for employ-
ment.

03 14 WASHINGTON HEARINGS

Employment forecasts, by quarters, for fiscal year 1943
[Annual rate in billions, 1935-39=100]

national
product

Estimated
national
income

Federal
Reserve
Board
industrial
production
index

Employees in non-
agricultural estab-
lishments

Manufac-
turing

Third quarter.

Fourth quarter
1:

First quarter..

Second quarter

Third quarter..

Fourth quarter
2:

First quarter..

Second quarter

Millions
10.2
10.8

11.0
11.4
11.7
12.2

12.4
12.0

Millions
29.8
31.0

32.0
33.2
34.1

33.3
34.5

Summary of defense labor requirements by geographical regions

Region and occupational group

Ship-
building

Aircraft

Machine
tools and
ordnance

Other

Total

United States

323, 900

408, 441

291,611
12, 316
26, 462
11, 579
72, 365
2,250

384,629

400

38, 500

35, 034

167, 426

4,376

1,800

71, 595

800

34, 700

29, 998

1, 408, 581

12, 716

51, 600
9,600
65, 700
21,200
67, 000
9,200
39, 900

10, 200
8,300
56, 167
37, 500
73, 500
125, 074
16, 600
54,100
27, 000

126, 762

East South Central

64, 513

361, 658

West South Central

65, 326

South Pacific

142, 300

113,973

100

39, 093

13, 473

319, 842

North Pacific

57, 400

127, 893

South Atlantic

59, 700

130, 171

NATIONAL DEFENSE MIGRATION

6315

Defense labor requirements by occupation — Preliminary estimates of the numbers of
additional workers required by April 1942 in the manufacture of aircraft, vessels,
machine tools, ordnance, and other defense items

Occupational group

Ship-
building

Aircraft

Machine
tools and
ordnance

Other

Total

United States

323, 900

408, 441

291,611

384, 629

1,408 681

32, 390

32, 675

14, 579

11, 539

91, 18S

19, 434
12, 956

20, 422
12, 253

8,748
5,831

7,694
3,845

56, 298

Engineers, etc -

34, 885

155, 473

147, 038

113,727

134. 620

550, 858

23,328

8,748

15, 384

38 712

Barrel riflers and straighteners

8 748

1,620
1.620
9,717
4, 859
3,239
3,239
11,338
12, 956

1,924

3,544
9,717

1,924
1,924

5 163

Drillers

3 239

Electricians - - - -

2,044
24, 504
20, 422
16, 338

2,918
11, 664
8,748
4,374

3, 845
15, 384
7,694
5,770

20, 145

64, 508
36. 864

Inspectors - - - . - . _

26, 482

3,239
1,620

35,629
8,098
8,098

13, 602

12, 956
972

16, 194
6,477

3,239

1,620

156, 453

Machinists ' -----

36, 759

37, 912

46, 153

8 098

1,924
5,770

16, 338

Ship fitters

12 956

8,168
2,043
20, 422

10, 205

873

4,957

7,694
1,924
17, 306

Welders

21 034

49, 162

Semiskilled - . .

71,257

167, 462

119,562

180, 776

539,057

1,620
6,477
9,717

8,748
29, 159

11,539
38, 463

Assemblers (erectors)

65, 349

139 448

9,717

20, 422

11, 665

. 15, 384

Handy men

21, 053
4,859

21,053

Machine operators, miscellaneous - -

8,168

32,078
5,831
2,918
1,458

50, 003
5,770
3,846
5,770
3,846
3,846

90.249

11.601

10,211
4,085

28,591
4,085
8,168

16, 975

Punch and press operators

11,313

32, 437
9,389

1,458

Skin fitters

8,168

4,859
3,239
19, 433

4,859
12, 627

Welders, tack

4,085
14, 298

1,457
24,790

3,846
38,463

Other —

96,984

Unskilled

64,780

61, 266

43, 743

57,694

227, 483

1 Including such skilled jobs as boring mill operators, engine lathe operators, milling machine opera-
tors, etc.

Prepared May 20, 1941, by the Bureau of Labor Statistics, U. S. Department of Labor, subject to revision.

6316

WASHINGTON HEARINGS

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2,090
1,257
4,134
1,083
1.082

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3,353
4, 983
2,895
9,471
2,537
2,501
138
2,629
21, 778

48, 436

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NATIONAL DEFENSE MIGRATION

6317

o .

g318 WASHINGTON HEARINGS

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 1942 in the manu-
facture of aircraft, vessels, machine tools, ordnance, and other defense items

IN ALABAMA

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

All employees

9,000

19,824

28, 824

900

594

1,494

540
360

396
198

936

558

4,320

6,938

11,258

793

45
45
270
135
90
90
315
360

144

270

99
99

234

189

198
793
396
297

513

1,153

396

297

90
45
990
225
225
378
360
27
450
180

'M'5iphini<!t<; 1

2,380

3,370

225

Pipe Fitters

99
297

324

675

360

_..-

396
99
893

423

549

Other

1,073

1,980

9,317

11,297

45
180
270

595
1,983

640

2 163

270

793

585
135

585

2,577
297
198
297
198
198

2 577

Painters

297

Polishers

198

297

Riveters

198

Sheet metal machine operators

198

135
90

540

135

198
1,983

288

Other

2,523

Unskilled

1,800

2,975

4,775

IN CALIFORNIA

67, 000

73, 50p

1,800

142. 300

Professional and su bprofessional

6,700

5, 880

12, 634

4,020
2, 680

3, 675
2,205

36
18

7,731

Engineers etc

4.903

Skilled

32. 160

23, 520

630

56,310

\ssemblers

-9

335

2,010

1,005

670

2, 345

2,680

335

344

Calkers and chippers

2.010

9
9

1,014

679

Drillers

670

Electrif^ians

367
5.880

18
72
36
27

2 730

8, 632

Orindcr operators

Inspectors

2,940

2,967

See footnote at end of table.

NATIONAL DEFENSE MIGRATION 53 JQ

IN CALIFORNIA— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Skilled-Continued.
Joiners

670

335

7,370

1,675

1, 675
2,814

2. 680
201

3,350
1,340

670

5,880

216

1,675

Pipe fitter.s

2,'205"

9
27

1 684

5,046
2 680

Ship fitters

Tool and die workers

1.103

735

4,410

36
9

1 340

Welders

Other

5.831

Semiskilled

14, 740

33, 075

846

48, 661

335
1,310
2,010

54
ISO

389

Assemblers (erectors)

11,025

12 545

735

Hindy men

4. 355
1,005

4 355

Machine operators, miscellaneous

367

735

367

1,103

8. 085

. 1,470

2,205

234

27
18
27
18
18

601

Painters

762

Polishers

Punch and press operators

1 130

Riveters

8 103

Sheet metal machine operators

1.488

Skin fittp'-s

2 205

1,005

670

4,020

1,005

Wplders, tack

1,103
5,880

18
180

1,791

Other

10, 080

Unskilled . ..

13,400

11,025

270

24 695

IN CONNECTICUT

4,200

8,700

14, 162

29, 100

56, 162

420

348

708

873

2,349

Draftsmen, etc

252
168

174
174

425

582
291

1,433
916

Skilled _..

2,016

3, 741

5,523

10, 185

21 465

1,133
425

1,164

2,297
425

21
21
126
63
42
42
147
168

Boilermakers

146

167

126

146
146

209

Cranemen

188

Drillers .

Electricians

87
435
826
348

142
566
425
212

291

1, 163

582

437

667

Foremen

2,332

1,833

Inspectors

997

21
462
105
105
176
168

13
210

Machinists '

1,479

1,841

3,491

7,273

105

Pipe fitters

146
437

251

Sheet-metal workers

613

168

Tool and die makers

261
44
261

42
241

582

146

1,308

1,352

Welders

442

Other

1,894

Semiskilled

924

3,306

5,807

13, 677

23, 714

84
126

425
1,416

873
2,910

1,319

Assemblers (erectors)

1,175

5,585
126

Drill-press operators

783

566

i, 163

2,512

60396— 41— pt. 1(

5320 WASHINGTON HEARINGS

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 19^2 in the manu-
facture of aircraft, vessels, machine tools, ordnance, and other defense items — Con.

IN CONNECTICUT— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Semiskilled— Continued.

273
63

273

H jlders-on

Machine operators miscellaneous

348
44
304

1,558
283
142
71

3,783
437
291
437
291
291

764

Polishers

737

Punch and press operators

508

291

Sheet-metal machine operators

406

Sta^e builders and riggers

63
42
252

Welders, tack ..

71
1,204

291
2,910

404

Other

608

4,974

Unskilled .

840

1,305

2,124

4,365

8,634

IN ILLINOIS

All employees

200

14, 000

28, 523

6,575

49, 298

560

1,426

197

2,203

' Draftsmen etc

280
280

856
570

131
66

1 279

924

Skilled

6,020

11, 125

2,302

19, 543

Assemblers

2,282
856

263

2 545

Barrel rifiers and straighteners

856

1
1
6
3
2

Calkers and chippers

33
33

Cranemen

Drillers

140

700

1,330

560

285

1,141

856

428

66
263
132

498

Foremen

2,112
2 318

1.087

Joiners

1
22
5
5
8
8
1
10
4

Loftsmen

2,380

3, 708

788

Painters

Pipefitters

33
99

107

Ship fitters

Tool and die makers

420
70
420

998
86

485

132
33

295

1 551

Welders .-

199

Other

1,204

Semiskilled ... .-

5,320

11, 694

3,090

20, 148

Apprentices

1
4
6

856
2,852

197
657

1 054

1,890

5,403

Drill-press operators

1,260

1,141

263

2 664

13
3

Machine operators, miscellaneous

560
70
490

3,138
570
285
143

854
99
66
99
66
66

4,552

Painters

739

841

Punch and press operators

242

Riveters

143

279

3
2
12

Welders, tack

980"

143
2,423

66
657

211

Other

4,072

UnskiUed

2,100

4,278

986

7,404

NATIONAL DEFENSE MIGRATION

6321

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 1942 in the manu-
factxire of aircraft, vessels, machine tools, ordnance, and other defense items — Con.

IN INDIANA

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

500

8,800

27, 670

29,000

65, 970

professional and subprofessional

352

1,384

870

2,656

Draftsmen, etc

30
20

176
176

830
554

580
290

1,616

1 040

Skilled

240

3,784

10, 791

10, 150

24, 965

2,214
830

1,160

3,374

830

Blacksmiths and anglesmiths

3
3
15

. 17

145

148

145
145

152

150

440
836
352

277

1,107

830

415

290

1,160

580

435

672

2,727

Grinder operators

2,246

1,202

5
3
55
12
12
21
20
2
25
10

Loftsmen

1,496

3,597

3,480

8,628

Pipe fitters

145
435

157

Sheet metal workers

456

Tool and die workers

264
44
264

968
83
470

580

145

1,305

1,814

297

Other

2.049

Semiskilled -

110

3,344

11, 344

13, 630

28,428

Apprentices

2
10
15

830
2,767

870
2,900

1,702

1,188

6,865

Drill press operators

792

1,107

1,160

3,059

Machine operators miscellaneous

352
44
308

3,044
553
277
138

3,770
435
290
435
290

. 290

7,166

1,032

Polishers

875

573

290

Sheet metal machine operators

138

472

8
5
30

Welders, tack - .- .-.

138
2,352

290
2.900

433

Other

616

5,898

Unskilled .

100

1 1, 320

1 4, 151

4,350

9,921

IN KANSAS

30,000

500

30,500

Professional and subprofessional

2,400

2,415

1,500
900

10
5

1,510

Engineers, etc

905

Skilled

9,600

175

9,775

20
3
3
3

5
20
10

8
57

Carpenters

Cranemen

150
2,400

155

Foremen

2,420

Grinder operators

1,200
2,400

1,208

Machinists '

2,457

Pipe fitters

Sheet metal workers -.

900

908

Q322 WASHINGTON HEARINGS

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 194^2 in the manu-
facture of aircraft, vessels, machine tools, ordnance, and other defense items — Con.

IN KANSAS— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Skilled— Continued.
Tool and die workers

450

300

1,800

10
3
22

460

Welders

13, 500

235

Apprentices

15
50
20
64
8
5
8
5
5

4,500
300
150
300
150
450

3,300
600
900
450

2,400

Machine operators, miscellaneous

214

Polishers

155

Punch and press operators

458

Sheet metal machine operators

605

Skin fitters

900

5
50

Other

2 450

Unskilled -

4,500

IN MAINE

All employees

17, 800

500

18, 300

Professional and subprofessional

1,780

1 795

1,068
712

10
5

Engineers, etc

717

Skilled

8,544

175

8,719

Blacksmiths and anglesmiths -

534

267
178
178
623
712

Carpenters

3
3

270

Cranemen

181

Drillers . -

178

Electricians

5
20
10

628

Inspectors

178
89
1,958
445
445
748
712
53
890
356

Loftsmen

Machinists i

2,018

Pipe fitters

448

Ship fitters

712

Tool and die workers

9
3
22

Welders

893

Other

378

Semiskilled

3,916

235

Apprentices

89
356
534

15
50

104

Bolters-up

534

Drill press operators

1,157
267

Holders-on

267

8
5
8
5
5

Polishers

Sheet metal machine operators

Stage builders and riggers

267

178
1,068

267

Welders, tack

5
50

Unskilled

3.560

NATIONAL DEFENSE MIGRATION

6323

IN MARYLAND

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

20, 500

27, 000

4,500

19, 539

71, 539

2,050

2,160

225

586

5,021

Draftsmen, etc

1,230
820

1,350
810

135
90

391
195

3,106

1,915

Skilled

9,840

8,640

1,755

6, 839

27, 074

Assemblers

_ _

360
135

782

1,142

Barrel riflers and straighteners

135

102
102
615
308
205
205
718
820

102

Boilermakers

200

Calkers and chippers

615

98
98

406

Cranemen

303

Drillers

205

135
2,160

45
180
135

585

195
782
391
293

1,093

Foremen

3,942

526

Inspectors

1,080

1,441

Joiners

205
102

2,254
513
513
861
820
62

1,025
410

790

Loftsmen

102

2,160

2,343

6,757

Painters

513

98
293

611

Sheet metal workers

810

1,964

Ship fitters

820

Tool and die workers - .

405

270

1,620

157
14
76

391

98
879

1,015

Welders

1,407

Other

2,985

Semiskilled

4,510

12, 150

1,845

9,183

27 688

102
410
615

135
450

586
1,954

823

Assemblers (erectors)

4,050

6,864

Bolters-up

615

Drill press operators

270

180

782

1,232

Handy men

1,332
308

1,332

Holders-on

308

Machine operators, miscellaneous

135
270
135
405
2,970
540
810

494
90
45
23

2,541
293
195
293
195
195

3,170

653

375

Punch and press operators

721

Riveters

3,165

758

Skin fitters

810

Stage builders and riggers

308

205

1,230

308

Welders, tack

405
2,160

23
382

195
1,954

828

Other

5,726

Unskilled

4,100

4,050

675

2,931

11,756

IN MASSACHUSETTS

28,200

1,500

9,000

6,400

45, 100

Professional and subprofessional

2,820

450

192

3,522

Draftsmen, etc

Engineers, etc..

il'm

30
30

270
180

128
64

2,120
1,402

Skilled

13, 536

645

3,510

2,240

19, 931

720
270

256

976

270

Blacksmiths and anglesmiths

141
141
846
423
282
282
987

141

173

846

Carpenters

32
32

455

314

Drillers

282

Electricians

1,156

60396—41— pt. 16

6324

WASHINGTON HEARINGS

IN MASSACHUSETTS— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Sliilled— Continued.
Foremen

1,128

75
143
60

360
270
135

256
128
96

1,819

Grinder operators

541

291

Joiners

282
141

3,102
705
705

1,184

1,128
85

1,410
564

282

141

254

1,170

7b8

5,294

Painters

705

32
96

737

Sheet-metal workers

1,280

Ship fitters

1,128

45
8
45

315

27
153

288

573

Welders

Other

1,477
1,050

Semiskilled

6.204

570

3,690

3,008

13, 472

141

564
846

270
900

192
640

602

Assemblers (erectors)

202

2, .307

Bolters-up

846

134

360

256

750

Handy men

1,833
423

1,833

423

60
8
53

990
180
90

832
96
64
96
64
64

1,882

Painters

284

207

Puncli and press operatOJ^s

141

Riveters

117

Stage builders and riggers

423

282

1,692

423

Welders tack

45
765

64
640

391

105

3.202

Unskilled

5,640

225

1,350

960

8,175

IN MICHIGAN

All employees

2,400

54, 512

27, 300

7,628

91, 840

240

4,361

1,365

229

6,195

144
96

2,726
1, 635

819
546

153

3,842

Engineers, etc

2,353

Skilled

1,152

19, 624

10, 647

2,670

34, 093

Assemblers

2,184
819

305

2,489

819

Blacksmiths and anplesmiths

Boilermakers

12
12
72
36
24
24
84
96

Carpenters

38
38

Cranemen

Electricians

273
3,271
2,726
?, 180

273

1,092

819

410

76
305
153
114

706

4.764

Grinder operators

Inspectors

2,704

Joiners

24
12

265
60
60

100
96
7

120
48

Machinist's!...

4,905

3,549

916

9, 635

P.iinters

38
114

Sheet-metal workers

2,180

2,394

Ship fitters

Tool and die workers

1,090

273

2,726

955
82
464

153
38
344

2,205

Welders

513

Other...

3,582

NATIONAL DEFENSE MIGRATION

6325

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 1942 in the manu-
facture of aircraft, vessesl, machine tools, ordnance, and other defense items — Con.

IX MICHIOAN— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Semiskilled -..

22. 350

11, 193

3,585

37, 656

Apprentices

48
72

819
2,730

229
763

1,060

8,722

12,263

Bolters-up

Drill-press operators

2,726

1,092

305

4,123

156

Holders-on

Machine operators, misceUaneous

1,090

3,002
546
273
137

114
76

114
76
76

5, 085
660

Polishers

1,363
545

3,816
545

1,090

l,7f2

796

3,892

Sheet-rcetal machine operators

137

758

1,090

Stage builders and rigpers

36
24
144

Welders, tack

Other

545
1,908

137
2. 320

76
763

782
5,135

Unskilled

480

8,177

4,095

1,144

13,896

IN MISSOURI

All employees '

9,100

24, 550

31, 000

64, 650

728

1,228

930

2 886

455
273

737
491

620
310

1.812

1,074

Skilled

2,912

9,574

10, 850

23, 336

Assemblers

1,963
737

1,240

3,203

Barrel riflers and straighteners

737

155
155
155
310

1,240
620
455

3,720
155
465
620
155

1,395

155

Carpenters

155

728

246
982
737
368
3,191

602

Foremen

2, 950

1, 357

Inspectors

364
727

1,197

Machinist'! '

7 638

155

Sheet-metal workers

273
137
91
546

738

Tool and die workers

859
74
417

1,616

Welders

320

Other

2,358

Semiskilled...

4,095

10,066

14, 570

28, 731

Apprentices

737
2,454
982
2,700
491
246
123

930

3,100

1,240

4,030

465

310

465

310

1 667

1,364
91
46
91
46
137
1,001
182
273
137
727

6,918

Drill-press operators

2,313

6,776

1,047

Polishers

602

725

1,311

Sheet- metal machine operators

123

615

Skin fitters

273

123
2,087

310
3,100

570

Other .

5,914

Unskilled

1,365

3,682

4,650

9,697

6326

WASHINGTON HEARINGS

IN NEBRASKA

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

15,000

1,500

16,500

Professional and subprofessional

1,200

1 275

Draftsmen, etc

750
450

45
30

795

480

Skilled

4,800

585

5 385

120
45
14
60
45
23

195

Barrel riflers and straighteners

75
1,200

Grinder operators

600
1,200
450
225
150
900

623

Machinists '

1 395

Sheet-metal workers

450

52
5
26

277

Welders

Other

926

Semiskilled

6,750

615

7 365

45
150

60
165

14
8

Assemblers (erectors)

75
150
75
225
1.650
300
450
225
1,200

2 400

210

Machine operators, miscellaneous

240

Painters

180

Punch and press operators

233

Riveters

1 650

308

Welders, tack

8
127

233

Other

1,327

Unskilled

2,250

225

2,475

IN NEW JERSEY

All employees

40, 000

10, 200

3,640

67, 722

121, 562

Professional and subprofessional

4,000

408

182

2,031

6,621

Draftsmen, etc

Engineers, etc

2,400
1,600

204
204

109
73

1,354
677

4,067
2,554

Skilled _

19, 200

4, 386

1,420

23, 704

291
109

2,709

3,000

Barrel riflers and straighteners

109

200

1,200

600

400

1,400

1,600

200

339

539

Calkers and chippers

1 200

339
339

939

Drillers

400

Electricians^

Foremen

Grinder operators

102
510
969
408

146
109
55

677
2,709
1,354
1,016

2,215
4,965
2 432

Inspectors . _

1,479

Joiners

400

200

4,400

1,000

i;600
120

2,000
800

400

Loftsmen

200

1,734

473

8,127

14, 734

Painters

1,000

Pipefitters

339
1,016

1,339

Sheet-metal workers

2,696

Ship fitters

1 600

306
51
306

128
62

1,354

339

3,047

1,908

Welders

2,401

Other

4 215

NATIONAL DEFENSE MIGRATION

6327

Break-doivn by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 1942 in the manu-
facture of aircraft, vessels, machine tools, ordnance, and other defense items — Con.

IN NEW JERSEY— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Semiskilled

8,800

3,876

1,492

31,829

45, 997

Apprentices

200

800

1,200

109
365

2,031
6,772

2,340

1,377

9,314

1,200

Drill-press operators

918

146

2,709

3,773

2,600
600

2,600

600

Machine operators miscellaneous

408
51
357

401
72
36

8.805

1,016

677

1,016

677
677

9,614

1,139

Polishers

1,070

1,034

Riveters

677

746

600

400

2,400

600

Welders tack

18
309

677
6,772

1,095

Other

714

10, 195

Unskilled

8,000

1,530

546

10, 158

20, 234

IN NEW YORK

All employees..

3,300

29,031

31,265

36,200

99, 796

Professional and subprofessional

330

2,322

1,563

1,086

6,301

Draftsmen, etc

Engineers, etc

198
132

1,451
871

938
625

724
362

3, 301
1,990

Skilled.-

1,584

9,290

12, 193

12, 670

35, 737

Assemblers

2,501
938

1,448

3,949

938

16
16
99
50
33
33
115
132

Boilermakers

181

197

Carpenters.--

Cranemen

181
181

231

214

DrUlers

Electricians

145
2,323

313

1,250

938

469

362

1,448

724

543

935

5.153

Grinder operators

1,662

Inspectors

1,161

2.173

33
16
363

83
83

132
10

165
66

Machinists'

2,323

4,064

4,344

11,094

Painters

181
543

264

Sheet-metal workers

871

1,563

132

435

290

1,742

1,094
94
532

724

181

1,629

2,263

Welders """""""""^

730

Other. -

3,969

Semiskilled

726

13, 064

12, 819

17, 014

43, 623

Apprentices

16
66

3,127

3; 620

2,040

4,355

11, 168

Drill press operators

290

1,251

1,448

2,989

Handv men

214
50

214

Machine operators, miscellaneous

145
290
145
435
3,194
581
871

3,439
625
313
156

4,706
643
362
543
362
362

8,290

Painters . ...

1,458

820

Punch and press operators

1,134

Riveters

3,556

156

1,099

871

Stage builders and riggers

50
33
198

Welders, tack

435
2,323

156

2,658

362
3,620

986

Other

8,799

Unskilled

660

4,355

4,690

5,430

15, 135

6328

WASHINGTON HEARINGS

Break-down by States — Defense labor requirements by occupation — Preliminary
estimates of the numbers of additional workers required by April 1942 in the manu-
facture of aircraft,; essels, machine tools, ordnance, and other defense items — Con.

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

All employees

4.600

47, 762

29, 780

23, 292

105, 434

460

3,821

1,489

699

6 469

276
184

2,388
1,433

893
596

466
233

4,023

2,446

Skilled

2,208

17, 194

11,614

8,152

39, 168

Assemblers

'893

932

3,315

23
23
138
69
46
46
161
184

116

139

138

Carpenters

116
116

185

162

239
2,866
2,388
1,910

298

1,191

893

447

233

466
349

931

Foremen

5,173

Grinder operators

3,747

2,706

23
506
115
115
193
184

14
230

Loftsmen

4,299

3,871

2,796

11,472

115

116
349

231

1,910

2,452

Ship fitters

184

955
239

1,043
89
506

466

116

1,049

2,478

Welders

674

Other

4,035

Semiskilled

1,012

19, 584

12, 210

10, 947

43, 753

23
92
138

893
2,978

699
2,329

1,615

Assemblers (erectors)

7,642

13,041

138

Drill-press operators

2,388

1,191

932

4,511

Handy men

299
69

299

Machine operators miscellaneous

955

3,276
596
298
149

3,028
349
233
349
233
233

7,259

945

Polishers

1,195

478

3,343

478
955

1,726

Punch and press operators

976

3,576

Sheet-metal machine operators

149

860

Skin fitters

955

69
46
276

Welders, tack

478
1,672

149
2,531

233
2,329

906

Other

6,808

Unskilled

920

7,163

4,467

3,494

16,044

IN OKLAHOMA

15, 400

15,400

1,232

770
462

770

Engineers, etc_

462

Skilled

4,928

77
1,232
616
1,232
462
231
154
924

1,232

616

1,232

Sheet-metal workers

462

231

154

Other

924

NATIONAL DEFENSE MIGRATION 6329

IN OKLAHOMA— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Semiskilled

6,930

2,310
154
77
154
77
231

1,694
308
462
231

1,232

2,310
154

Drill-press operators

Painters

154

Polishers

231

Riveters

1,694

308

462

Welders, tack

231

Other

1,232

Unskilled

2,310

IN PENNSYLVANIA

All employees

22,400

16, 936

37,460

63. 504

140, 300

Professional and subprofessional

2,240

1,355

1,873

1,905

7,373

1,344

847
508

1,124
749

1,270
635

4,585

Engineers, etc

2,788

Skilled .-

10, 752

6,097

14,609

22, 226

53. 684

2,997
1,124

2,540

5,537

1,124

Blacksmiths and anglesmiths

112
112
672
336
224
224
784
896

112

318

430

Calkers and chippers

672

Carpenters

318
318

654

542

Drillers

224

1,016

847

677

375
1,498
1,124

562

635
2,540
1,270

953

1,879

Foremen

5,950

Grinder operators

3 241

2,192

Joiners

224
112

2,464
560
560
941
896
67

1,120
448

224

112

Machinists i .

1,524

4,870

7,617

16, 475

Painters

560

318
953

878

Sheet-metal workers

677

2,571

Ship fitters

Tool and die workers

339

85
847

1,310
112
637

1,270
318

2,858

2,986

Welders

1,635

Other

4,790

Semiskilled

4,928

6,944

15, 359

29. 848

57, 079

112
448
672

1,124
3,746

1.905
6,350

3,141

Assemblers (erectors)

2,710

13 254

672

Drill-press operators

847

1,499

2,540

4.886

Uandv men

1,456
336

1 456

336

Machine operators, miscellaneous

339

4,121
749
375

187

8,257
953
635
953
635
635

12,717

■ Painters

1,702

423
169
1,186
170
338

1,433

Punch and press operators

1,821

Sheet-metal machine operators

187

992

Skin fitters

336

224

1,344

336

Welders, tack.

169
593

187
3,184

635
6,350

1,215

Other

11 471

Unskilled

4,480

2,540

5,619

9,525

22,164

6330 WASHINGTON HEARINGS

IN TENNESSEE

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

300

8,300

9,156

6,710

24, 466

Professional and subprofessional

664

458

201

1,353

Draftsmen, etc

18
12

415
249

275
183

134
67

842

Engineers, etc

511

Skilled

144

2,656

3,571

2,349

8,720

Assemblers

732
■ 275

268

1,000

Barrel riflers and straighteners

275

2
9
5
3
3
10
12

Boilermakers

Calkers and ehippers

34
34

Cranemen

Electricians

42
664

92
366
275
137

67
268
134
101

211
1,310

409

Inspectors

331

569

31
8
8
13
12

14
6

Loftsmen

Machinists'

664

1,191

804

2,690
8

Pipe fitters

34
101

249

363

125
83
498

320
27
156

134
34
302

580

Welders

158

Other

962

Semiskilled _

3,735

3,754

3, 153

10, 708

2
9

275
916

201
671

478

Assemblers (erectors)

1,243

2,836

Bolters-up

366

268

717

18
5

Holders-on

42
83
42
125
913
166
249

1,006
183
92
46

872
101
67
101
67
67

1,920

367

Polishers

201

272

Riveters

980

279

249

Stage builders and riggers

Welders, tack

5
3

125
664

778

67
671

241

Other

2,131

illed...._ ._

1,245

1,373

1,007

3,685

IN TEXAS

14,300

22, 100

2,250

3,500

42, 150

Professional and subprofessional

1,430

1,768

113

105

3,416

858
572

1,105
663

68
45

70
35

2,101

Engineers, etc

1,315

Skilled

6,864

7,072

878

1,225

16, 039

180
68

139

319

Barrel riflers and straighteners

72
72
429
215
143
143
501
572

Calkers and ehippers

429

Carpenters

18
18

233

161

Drillers

143

111

1,768

23
90

35
139
70

670

2,569

Grinder operators.

138

NATIONAL DEFENSE MIGRATION

6331

IN TEXAS— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Skilled— Continued.

884

971

143
72
1.572
358
358
600
572
43
714
285

143

1,768

292

419

4,051

358

18
53

376

663

1,316

572

Tool and die workers

332

221

1,325

70
18
157

523

Welders -

960

Other

1,805

SemiskiUed

3,146

9,945

922

1,645

15, 658

72
285
429

224

105
350

245

3,314

4,173

429

Drill-press operators

221

140

450

929
215

929

215

111
221
111
332
2,430
442
663

247
45
23
12

454
53
35
53
35
35

812

319

169

397

Riveters

2,465

489

663

215
143

858

215

Welders, tack

332
1,768

12
190

35
350

522

Other

3,166

Unskilled

2,860

3,315

338

525

7,038

IN VIRGINIA

22. 300

9,773

1,934

34, 007

2,230

489

2,777

Draftsmen, etc

1,338
892

293
196

39
19

1,670

1,107

Skilled

10, 704

3,811

677

15, 192

Assemblers

782
293

859

Barrel riflers and strai^hteners

293

112
112
668
335
223
223
781
892

112

122

Calkers and chippers

668

10
10

345

233

Drillers

223

Electricians

98
391
293
147

77
39
29

898

1,360

Grinder operators

332

176

223
112

2,452
557
557
937
892
67

1,115
446

223

112

1,270

231

3,953

557

Pipe fitters

10
29

567

Sheet-metal workers

966

892

Tool and die workers

342
29
166

39
10
87

448

1,154

Semiskilled

4,906

4,007

909

9,822

112

446
668

293
977

194

464

Assemblers (erectors)

1,617

Bolters-up

668

391

468

Handy men

1,450

5332 WASHINGTON HEARINGS

IN VIRGINIA— Continued

State and occupational group

Shipbuild-
ing

Aircraft

Machine
tools and
ordnance

Other

Total

Semiskilled— Continued.

335

1,075
195
98
49

251
29
19
29
19

1,326

224

117

335

223

1,337

335

Welders tack

49
831

19
194

291

2, 362

Unskilled

4,460

1,466

290

6,216

IN WASHINGTON

28, 300

16,600

100

600

45, 600

2,830

1,328

4,181

Draftsmen etc

1^132

830
498

3
2

12
6

2,543

1,638

Skilled

13, 584

5,312

210

19, 145

8
3

Barrel riflers and straighteners

141
141
849
425
283
283
991
1,132

141

144

849

3
3

428

Cranemen

286

Drillers

283

Electricians

1,328

1
4
3

6
24
12

1,081

2,488

Inspectors

664

674

283
141

3,112
708
708

1,189

1,132
85

1, 415
566

283

141

Machinists '

1,328

4,525

708

711

498

1,696

Ship fitters

1, 132

Tool and die workers

249
166
996

12
27

350

Welders

1,584

Other - -

1,591

Semiskilled

6,226

7,470

282

14, 019

141
566
848

3
10

18
60

162

2,490

3,126

848

Drill-press operators

166

194

1,840
425

1,840

425

83
166

83
249
1,826
332
498

10
2
1
1

78
9
6
9
6
6

171

177

Punch and press operators

259

1,832

339

498

425

283

1,698

425

Welders tack

249
1,328

1
8

539

Other

3,094

Unskilled

5,660

2,490

8,255

' Including such skilled jobs as boring mill operators, (ngine lathe operators, milling machine operators,
to.
Prepared May 20, 1941, by the Bureau of Labor Statistics, U. S. Department of Labor, subject to revision.

NATIONAL DEFENSE MIGRATION 6333

TESTIMONY OF SIDNEY HILLMAN— Resumed

HOUSING ALLOTMENTS AS COMPARED WITH PERMITS FOR PRIVATE

BUILDING

Mr. HiLLMAN. The second topic upon which information has been
requested is a comparison of the housing allotments made to private
builders by the Division of Defense Housing Coordination with
the permits wliich have been issued for private building in those same
localities within the last j^ear. This matter is in the province of the
Defense Housing Coordinator. We are in close touch with tliis hous-
ing problem in two ways. First, I have set up in the Labor Division a
liaison service to keep the Housing Coordinator constantly apprised
of labor requirements in defense areas, and to present to him the re-
ports received thereon from the Bureau of Employment Security and
the Bureau of Labor Statistics. Second, through our committee on
plant sites, we study housing conditions and labor supply in areas
where the contracting agencies of Government propose to locate
defense plants. By advising these agencies on the housing and labor
supply conditions we are able in many cases to bring about such
location of new plants as will avoid severe housing shortages.

It is obvious that in order to insure swift and efficient production
of defense materials, there must not only be an adequate supply of
qualified labor, but also housing facilities at rent levels within the
economic range of that labor. Now, addressing myself to the specific
question put to me by the committee, I have here a tabulation listing
68 localities for which the Defense Housing Coordinator has estab-
lished a quota for private builders. For 60 of these localities, there
are comparable figures showing the total amount of private building
done in 1940. Hi 30 of these localities, private building in 1940 was
greater in amount than that- recommended by the Coordinator to be
privately constructed in 1941, and for 30 localities it was less.

TYPE OF HOUSING IN RELATION TO DEFENSE-

However, we cannot approach this problem solely from the stand-
point of the amount of housuig. We must also concern ourselves
with the type of housing which defense workers require. Much of
the new building consists m dwellings for purchase, whereas much of
the requirement of defense workers is for rental housing. Some of
them expect to go back, after the emergency, to the places from
which they origmally came.

While our facts are not complete, it is clear, that m many localities,
the housing that is bemg built cannot be made available for defense
workers. In Hartford, Conn., for example, of 1,190 permits filed for
new dwelling units, financed from private fimds, 898 had permit
values of $4,000 or more, uidicating purchase prices of $5,600 or more.
Housing in this price category is generally out of the reach of defense
workers. This situation is generally true of the cities covered in the
tables which I am submitting for the record.

May I direct your attention to cases where the allocations of housuig
do not seem sufficient for the approaching requirements of defense
labor? Wichita, Kans., will require 21,000 additional defense
workers in the next 18 months, which is a very conservative estimate,
of which 15,000 to 17,000 must apparently come from outside. But

5334 WASHINGTON- HEARINGS

only 500 dwelling units are expected to be constructed by private
interests and 1,000 units by public agencies. In the Seattle, Wash.,
area, during the next year from 50,000 to 55,000 workers will be re-
quired, of whom 28,000 to 30,000 must be secured from outside
the mam city area. One thousand dwellings have been allocated for
private construction and 500 for public construction. There are other
instances where the projected housing likewise seems insufficient.

I herewith present Exhibit B, containing tabulations of figures
covering the requested information, together with a statement analyz-
ing these figures.

The Chairman. Yom- exliibit will be received.

(The document referred to follows:)

Exhibit B. — Comparison of Dwelling Units Allotted for Private Con-
struction With Permits Filed by Private Builders

I have been asked by the committee to make a comparison of the number of
dwellings units allocated by the Defense Housing Coordinator to the private
building industry in dc "ense areas with the amount of private building during the
past year in the same areas as evidenced by the filing of building permits. I wish
to submit for the coP'^-'deration of the committee a table listing the localities where
the allocations ' v^ate construction of defense housing have been made and

showing the nu. i dwelling units which have been assigned to private build-

erg. This table . shows for the same localities the number of dwelling units
which building permits were filed by private builders during 1940 and the
rirst quarter of 1941 as reported to the Bureau of Labor Statistics, United States
Department of Labor.

Since some political subdivisions included in defense areas do not require
building permits and others which require permits do not report them to the
Bureau of Labor Statistics, two columns of population data are given in the table
to indicate the extent of coverage. The first column of population data represents
the total population of the defense areas as defined by the Defense Housing
Coordinator's Office. The second column of population data represents total
population of those communities reporting building permits.

Hasty conclusions should not be drawn from the figures presented in this table.
This warning stems from the fact that the number of dwelling units allocated for
private construction is the Defense Housing Coordinator's recommendation of the
amount of housing which he considers private builders should provide for defense
workers, whereas the information on building permits represents the total amount
of residential construction of all types and for all persons undertaken by private
builders.

Moreover, the allocation for private construction represnts future requirements,
whereas the building permit data represents past performance. Information will
be presented later for five of these defense communities showing the extent to
which the housing constructed by private builders is too costly for defense workers.
The figures showing the number of dwelling units constructed by private builders
during 1940 and the first quarter of 1941 mast be taken as a measure of the
capacity and willingness of private builders to construct dweUings under condi-
tions existing during that period. As conditions change, the willingness and
capacity of builders to construct new dwellings will also change. According to
the Bureau of Labor Statistics, permits were filed for 22.4 percent more dwellings
during the first 4 months of 1941 than during the first 4 months of 1940 for the
entire country, including both defense and nondefense areas. • It can be pre-
sumed that the increase averaged somewhat greater than this percentage in
defense areas.

".500 batting average not good enough"

There are 68 localities listed in this table for which the Defense Housing Coordi-
nator has established a quota for private builders. For eight of these localities
no information on past building is available. The number of dwelling units
recommended for private construction by the Housing Coordinator is greater
than the total amount of private building during 1940 in 30 localities and less than
the total amount of building in 30 localities. If it can be assumed that builders

' Monthly Labor Review, June 1941, p. 1586.

NATIONAL DEFENSE MIGRATION 6335

would duplicate their 1940 performance and that all housing constructed will be
available to defense workers or will serve to make other units available to defense
workers, this would give a .500 batting average, which might not appear too bad.
However, in this emergency we cannot afford a .500 batting average. If workers
are to be available for the expansion of production when needed, there must be
houses ready for them at costs within their ability to pay.

Some persons will no doubt question comparing allocations with 1940 data.
It is known that in many areas builders are bettering their 1940 performance by
a substantial amount, but at the same time we must realize that not all the
housing constructed by private builders is available for defense workers or will
make housing available for defense workers. In the first place, migrating defense
workers require rental housing for the most part. Few have the wherewithal to
purchase new houses, and if thej- had, there is not the willingness to assume the
obligation of home purchase immediately after securing a new job in a new com-
munity. If migrating defense workers purchase homes, it will be because lack
of available rental hovising at reasonable rents force them to do so. It is impossible
to learn from the data available how much of the new housing being constructed
is rental housing. However, the information available for five cities indicates
that most of the new construction is single-family houses and such houses are
usually built for sale. In the Hartford, Conn., area, for example, 1,111 of the
1,190 dwelling units for which permits were filed were in siiigle-family buildings.

NEW HOUSING TOO COSTLY FOR DEFENSE WORKERS

In the second place, a large proportion of the dwellings'-' ' '" cted are too
costly for occupancy by industrial workers. I submit for V' •' 'ration by the
committee five tables showing the number of dwelling units '^^i- vhich permits-
were filed classified by permit value. It is the experience of peopPe who have deai„'
with building permit data that the value shown on building permits substantially
understates the true cost of conscruction. Moreover, the estimated cost of con-
struction includes no allowance for the cost of the lot on which the dwelling is
placed. Studies made by the Bureau of Labor Statistics indicate that the actual
cost of purcha.se, including the cost of the lot, average 40 percent more than the
stated cost of construction as shown on the building permit. Let me quote some
figures from these tables (tables 2 to 6).

EXAMPLES IN HARTFORD

In Hartford, Conn., during the period from July 1940, through January 1941,
permits were filed for 1,190 new dwelling units. Of this number, 578, or'almost
one-half, had permits values of $5,000 or more. If we add 40 i^ercent to $5,000
to arrive at an estimate of the total cost of these houses to purchasers, it is ap-
parent that one-half of this construction is available to purchasers at prices rang-
ing upwards from $7,000. In addition, there were 320 houses with permit cost of
$4,000 to $5,000. Actual cost of these houses would range from $5,600 to $7,000.
Even these houses are clearly out of reach of industrial workers. There were only
292 dwellings where the permit valuation was less than $'',000, i. e., less than a
total actual cost of $5,600. A large number of these would also be out of the reach
of industrial workers. To a greater or lesser extent the same situation is true
in the other cities covered by these tables with the exception of Norfolk, Va.

EXAMPLES IN CAMDEN, QUINCY, PORTSMOUTH, AND NORFOLK

In the Camden, N. J., area, 431 of the 836 dwelling units covered by permits
issued from July 1940 through March 1941 had permit values of $4,000 or more,
or an estimated total purchase cost of $5,600 or more. In the Quincy, Mass.,
area, 473 of 811 permits filed showed valuations of $4,000 or more, or would cost
some $5,600 or more to the purchaser. In the Portsmouth, N. H., area, 92 out
of 286 permits from July 1940 through March 1941 had permit values of $4,000
or more.

In Norfolk, Va., on the other hand, there were only 264 of the 1,642 dwelling
units covered by building permits which had valuations of $4,000 or more, and
there were 1,144 with valuations of less than $3,000.

NEW HOUSING, ONCE REMOVED FROM WORKERS, IS NO SOLUTION

It is obvious from these figures that a large proportion of private building does
not make housing directly available to industrial defense workers. No doubt
some of the houses vacated by the purchasers of these higher priced homes aie
60396— 41— pt. 16 3

^336 WASHINGTON HEARINGS

suitable for and are made available to defense workers. If not themselves occu-
pied directly by defense workers, they are occupied by others who vacate their
previous homes' and after several shifts of this kind some dwellings may be made
available to defense workers. In fact, during the past, we have depended almost
entirely on this trickling-down process for the provision of homes for our lower
income workers. That this process has not worked too well in the past is evidenced
by the kind of housing that is occupied by large numbers of our low-income work-
ers. We cannot depend on its working during this emergency when tens of
thousands of new workers are being introduced into communities at a much higher
rate than that at which purchasers can be found for high-priced homes.

PRIVATE BUILDERS ALSO FILLING NORMAL NEEDS

In the third place, it must not be forgotten that a large part of the construction
being done by private builders is to meet the normal housing need of the defense
areas. With increased employment families are undoubling and securing homes for
themselves. Marriages which have been postponed because of lack of employ-
ment are taking place and result in a demand for additional housing. Moreover,
it is common knowledge that the age composition of our population is changing
and that there are more people at those ages where families are created, and that
even in those areas where population is more or less permanent, the number of
families is increasing. The resulting demands for housing may not be regarded as
direct defense needs, but they are real demands and they do help absorb whatever
housing there is available. There is no way of determining exactly how much
housing is made available for defense workers by a given amount of construction,
but it is my estimate that in the average community net more than one-half of the
construction is available for industrial workers engaged in defense work, even when
due allowance is made for the trading-up process.

EXAMPLES OF UNDUE RELIANCE ON PRIVATE INDUSTRY

The following are a few outstanding cases where it seems to me that undue
reliance has been placed on private industry. In the Buffalo-Niagara, N. Y., area
the coordinator allocated 4,000 units to private builders, whereas during the year
1940 there were only 1,149 new dweUings constructed in the greater part of the
area. In Portsmouth, N. H., 600 units were allocated to private construction
when only 124 were provided during 1940 by private builders. In Philadelphia,
11,000 units were allocated to private construction and during the year 1940 only
6,390 were provided. Allocations in Baltimore, Md., amounted to 9,000 dwellings,
with a total 1940 construction of 5,835. In Vallejo, Calif., there were 1,800 units
allocated whereas 1940 production did not exceed 281 units. Also, in Ogden,
Utah, 850 units were assigned to private builders, while only 282 were built
during 1940.

It must not be assumed from this statement that housing conditions are under
control where the amount assigned to private builders is substantially less than
what private builders constructed during 1940.

SHORTAGES IN WICHITA AND SEATTLE

The comparison is favorable for some localities only because the total amount
programmed, including publicly and privately financed construction, is sub-
stantially under the requirements of the defense program. Wichita, Kans., is
cited as an example; 500 units have been assigned to private construction, and
funds for 1,000 units have been allocated for public construction. During 1940
there were 728 dwellings provided by private builders, and during the first quarter
of 1941, 290 units were being provided. According to a recent report, which has
been made available to the Housing Coordinator, 21,000 additional workers will
be employed on defense work in Wichita during the next year and a half. Of
this number a large proportion must come from outside the Wichita area and wiU
require housing. This number may reach a total of 15,000 to 17,000 workers.
They cannot be recruited unless substantially more housing is provided than is
now being planned.

In the Seattle, Wash., area, exclusive of Tacoma and Bremerton, 1,000 dwel-
lings have been assigned for private construction and 500 for public. Private
builders in 1940 filed permits for 2,055 dwellings. My information is that dur-
ing the next year 50,000 to 55,000 additional workers will be required in Seattle,
and that 28,000 to 32,000 of these must be secured from outside the feasible com-
muting area. There will be no housing for these workers unless both public and

NATIONAL DEFENSE MIGRATION

6337

private housing is greatly expanded, and without adequate housing it is extremely
doubtful that labor requirements can be met. ■ -■a'

There are other areas in which inadequate provision is being made to house the
defense workers who must be brought in if defense schedules are to be met.
Housing of defense workers in Buffalo, Philadelphia, Detroit, Hartford, and Balti-
more is of deep concern from the standpoint of the recruitment and maintenance
of an adequate labor supply.

Table 1. — Dwelling units allotted for private construction within defense areas and
permits filed by private builders dxiring 1940 and first quarter 1941 in reporting
places

Locality

1940
popula-
tion

Dwelling
units allo-
cated for
private
construe
tion

as reporting building permits to
Bureau of Labor Statistics

Number
of places
reporting
in addi-
tion to
central
cilies
named

1940
popula-
tion

New dwelling

units by private

builders-

First

quarter

1941

New England:

Bridseport, Conn.._

Hartford, New Britain, Meriden,

Bristol, Conn..

New London, Conn

Bath, Maine

Boston, Mass...

Portsmouth, N. H

Middle Atlantic:

Northern New Jersey 2

Buffalo and Niagara, N. Y

Sidney, N. Y..

Allentown, Bethlehem, and Easton,

Corry, Pa

Ellwood City and New Castle, :
Philadelphia, Pa.«

Pittsburgh, :

East North Central:

Joliet, 111

Davenport, Iowa, and Rock Island

and Moline, 111.-

Connersville, Ind

Fort Wayne, Ind

Kingsbury, and La Porte, Ind

Madison, Ind

South Bend, Ind

Detroit, Mich

Muskegon, Mich.

Canton, Ohio

Cleveland, Ohio..

Dayton, Ohio

Ravenna and Warren, Ohio..
Manitowoc, Wis.

West North-Central:

Burlington, Iowa

Kansas City, Kans. and Mo.

Wichita, Kans

Rolla and Waynesville, Mo..

South Atlantic:

Washington, D. C.6

Jacksonville, Fla

Key West^Fla

Miami, Fla

Pensacola, Fla

Tampa and St. Petersburg, Fla_

Macon, Ga

Baltimore, Md

Fayetteville, N. C

216, 621

518, 309

47, 960

2, 650

1,534,120

35, 784

866, 066
10, 127

330, 002

10, 932

80, 587

2, 537, 306

1, 475, 735

100, 258

174, 995
16, 771

134, 385
23, 632
14,832

147, 022

74, 458

200, 352

1, 214, 943

271, 513
76, 694
42, 557

32, 863
634. 093
127, 308

15, 717

6 914, 000
195, 619
12, 927
250, 537
48, 573
209, 693
74,830 I
1, 009, 517
38, 131

Jacksonville, N. C

See footnotes at end of table.

1,500

1,700
100
200

1,000
600

5,000
4,000

1,000

100

11, 000

10, 000

200

1,325
100
50
150
50
750
10, 000
550
300
1,500

750
150
150

450

1,000

550

300

7,000
350
100

300
100
350
9,000
110
366

201, 807

420,046

30, 456

(1)

1,534,120

14, 821

2, 593. 220
2, 604, 663

78S, 480
(')

252, 411

(';

2, 357; 789
2, .360, 431
1, 130, 206
1,118,794

43, 897

149, 555

12.898

120,282

16,180

6, 923

129. 566

2, 008, 729

2, 025, 098

47, 697

138,033

1,168,4.53

1,1.55,243

223.914

55, 759

34, 706

25. 832
539, 390
114,966

(')

914, 000
173, 065

0)
212, 436
214, 409

37, 449
170, 327

57, 865
984, 237
970, 871

17,428

(')

1,202

2,003
61
(')

2, 567
124

8,137

"i,"i49"
(')

405
(')
24

1,675
224

6,390

1, 610

2,398

547

1,051

126

625

112

(')

337

140

14, 408

4,432

156

406

117

4,110

975

829

189

213

146

445

104

728

290

(')

15, 460

4,611

1,386

418

(■)

(')

5,197

678

302

1,450

314

104

5,835

1,967

368

111

(')

6338 WASHINGTON HEARINGS

Table 1.- — Dwelling xmits allotted for •private construction within defense areas and
permits filed by private builders during 1940 and first quarter 1941 in reporting
places — Continued

Locality

1940
popula-
tion

I Dwelling
I units allo-
cated for
private
construc-
tion

Areas reporting building permits to
Bureau of Labor Statistics

Number
of places
reporting
in addi-
tion to
central
cities
named

1940
poptila

tion

New dwelling

units by private

builders-

First

quarter

1941

South Atlantic— Continued.

Wilminsrton, N. C

Charleston, S. C

Columbia, S. C

Norfollc and Portsmouth, Va

Morgantown, W. Va

Charleston, W. Va

Charlotte, N. C

East South Central:

Gadsden, Ala

Muscle Shoals, Ala

Biloxi, Miss

Meridian, Miss

Jackson, Milan, and Humboldt, Tenn
Nashville, Tenn

West South Central:

Leesville, La

New Orleans, La

Corpus Christi, Tex

Beaumont, Port Arthur, and Orange,

Tex

Dallas and Fort Worth, Tex

San Antonio, Tex

Victoria, Tex

Wichita Falls, Tex

Mountain: Ogden, Utah

Pacific:

San Francisco and Oakland, Calif

Vallejo, Calif

Bremerton, Wash

Seattle, Wash

46, 52fi

89, 555
250, 389

57, 563
136, 332
112,986

47. 205
38, 647
43, 498

58, 247
G2, 710

241, 769

15, 548
540, 030
107, 615

166, 863
584. 225
338, 176
23, 741
53. 984
55, 364

,331.071
73, 590
29, 232
452, 639

50
2,350
150
400
50

100
250
50
50

100
445
490

500
1,000

33, 407
72, 973
67, 648
64, 140

203, 115
16, 655
87, 115

100, 899

36, 975
13,448
34,165
35, 481
27, 367
32, 527
167, 402

0)
494, 537
64, 081

112, 673
498, 375
259, 554

45, 112
43,688

1, 252, 150
35, 193
15, 134
370, 386

1,092
22

771
872

326
14
230
160

1,207
1,495

565
4,191
1.278

(')
271
282

11, 194

150
1,045
358
(')
63
92

2,740
85
87
555

1 No reports.

2 Includes areas of Jersey City, Newark, Caldwell, Paterson, Dover, Bound Brook, Long Branch, Sandy
Hook, and New Brunswick.

3 Only New Castle reporting.

* Includes areas of Philadelphia, Bucks County, Chester, and Delaware County.
« Only La Porte reporting.

6 Includes, in addition to the metropolitan area as defined for 1930, districts 5, 9, 15, 3, 7, and part of 10,
in Prince Georges County, Md., and part of district 5 in Montgomery County, Md. The total popula-
tion of the area is an estimate because of the divided districts.

7 Tus umbia and Sheffield reporting. Muscle Shoals not reporting.

° Jackson and Milan reporting in 1940 and 1941, Humboldt only in 1941.

Prepared in the Bureau of Labor Statistics, U. S. Department of Labor, Division of Construction and
Public Employment.

NATIONAL DEFENSE MIGRATION 6339

Table 2. — Family-dwelling units provided in the Hartford, Conn., area ^ as indicated
by building permits issued in July 1940 to January 1941, inclusive, by cost class
and place of issuance

1
1

w
1

3
1

2
5

■^

Total

1,190

149
35

378
?,92

221

107

27
9

Over 5,000

578

4fi

4,000 to 4,999

320

3,000 to 3,999

217

2,000 to 2,999

1 000 to 1 999

Not reported

Population

Bloomfleld (town) 3,247

East Hartford (town) 17,125

East Windsor (town) 3,815

Glastonbury (town) -- 5,783

Hartford (city) 164,072

Manchester (town) 21,973

Newinsrton (town) 4, .572

Rockville (city) and Vernon (town),. 8, 703 TotaL

2 Building permits not required: data obtained from town clerk.

3 Includes data for city of Rockville and Vernon (town) .

< Building permits not required; data obtained from building and loan association, leading builder
building-material dealer, and confirmed by town clerk.

PopiiJa'ion
{,1930)

Rocky Hill (town) 2,021

South Windsor (town) 2,535

West Hartford (town) 29,941

Wethersfleld (town) 7,512

Windsor (town) 8,290

Windsor Locks (town) 4,073

Table 2A. — Famtly-dwelling units provided in the Haitford, Conn., area^ as indi-
cated by building permits issued February to April 1941, inclusive, by cost class
and place of issuance

1
1

1
§

i
h

Total

467

137

247
127

7
13

18
38
13

98
19
20

15
26
12

18
12
14

1
1

23
9

1
1
2

5
1

4
6

1
1
1
1

1
1

4,000 to 4,999

3,000 to 3,999

2,000 to 2,999

1 000 to 1 999

Under 1,000

Population
(1930)

Bloomfleld (town) - 3,247

East Hartford (town) 17, 125

East Windsor (town) 3, 815

Glastonbury (town) 5.783

Hartford (city) 164,072

Manchester (town) 21,973

Newington (town) 4, 572

Rockville (city) and Vernon (town) _ . 8. 703

Prepared in the Bureau of Labor Statistics, U
and Public employment.

Population
(1930)

Rocky Hill (town) 2,021

South Windsor (town) 2,535

West Hartford (town) 29,941

Wethersfleld (town) 7,512

Windsor (town) 8,290

Windsor Locks (town) 4,073

Total 283,662

Department of Labor, Division of Construction

g340 WASHINGTON HEARINGS

Table 3. — Family-dwelling units provided in the Camden, N. J., area as indicated
by building permits issued July 1940 to March 194-1, inclusive, by location of
construction and cost classes^

Permit valuation per unit

Location of construction

Total

5,000
and
over

4,000

to
4,999

3,000

to
3,999

2,000

to
2,999

1,000

to
1,999

Under
1,000

836

169

262

307

Audubon

Berlin Borough

Brooljlawn Borough

118
1
28
19
16
6
1
31
7
10
35
58
100

2
69

23
65
4
8
4
5
8
2
3

57
30
10

24"
3

75
1
2
4

Clemcnton Borough

2
3
3
3

2
1
2
1

Deptford Township

Gloucester

16
6

1
8

Greenwich Township

Haddonfleld Borough

30
20

5
31
48

7
24

Haddon Township

Laurel Springs Borough

Magnolia Borough

1
2
2
4
2
11

9
8
28

64
10
11
25

Oaklyn Borough

1
1

Pensauken Township

Pine Hill Borough

3
1

Runnemede Borough

Tavistock Borough. . _

Wenonah Borough

West Deptford Township

1
37
9

........

2
2

4
15

11
6

Woodbury

• During the period surveyed July 1940 to March 1941, inclusive, no construction activity was reported in
the following places: Berlin Township, Glassboro Borough, Bi-Wella Borough, Lawnside Borough
National Park Borough, Pine Valley Borough, Somerdale Borough, Stratford Borough, Voorhees Town
ship, and Woodlynne Borough.

Prepared in the Bureau of Labor Statistics, U. S. Department of Labor, Division of Construction and
Public Employment.

Table 4. — Family-dwelling units provided in the Quincy, Mass., area as indicated
by building permits issued July 1940 to January 1941, inclusive, by cost class
and place of issuance

Total

Quincy

Wey-
mouth

Hing-
ham

Brain-
tree

Mil-
ton

Ded-
ham

Can-
ton

Ran-
dolph

Hol-
brook

Hun

Total

811

196

185

142

134

Over 5,000

244
229
207
95
34
2

47
42
70
23
1

33
91

54
4
3

119
10
8
3

1
1

18
27
80
7
2

41
34
4

13
5

14
5

5
4
3

10
2

4,000 to $4,999

3,000 to 3,999

2,000 to 2,999

1,000 to 1,999

Under 1,000

Prepared in the Bureau of Labor Statistics, U. S. Department of Labor, Division of Construction and
Public Employment .

NATIONAL DEFENSE MIGRATION

6341

Table 5. — Family dwelling units provided in the Quincy, Mass., area, as indicated
by building permits issued in February 1941 to April 1941, inclusive, by cost
class and place of issuance

Total

Quin-
cy

Wey-
mouth

Hing-
ham

Brain-
tree

Mil-
ton

Ded-
ham

Can-
ton

Ran-
dolph

Hol-
brook

Hull

Total

253

Over 5,000

59
91
48
45
9
1

6
18
16
40

14
25
14

4
6
1

1
17
8

29
15

3
2

2
4
3

4,000 to 4,999

3,000 to 3,999

2,000 to 2,999

1.000 to 1.999..

Under 1,000

Prepared in the Bureau of Labor Statistics, U. P Department of Labor, Division of Construction and
Public Employment.

Table 6. — Family-dwelling units piovidcd in the Portsmouth, N. H., area * as
indicated by building permits issued July 1940 to March 1941 inclusive by cost
class and place of issuance

■3

S3
1

a
1

■z

1
1

i
1

a
z

Total

286

Over 5,000

29
63

22
21

2
5

1
7

4,000 to 4,999

3,000 to 3.999

2,000 to 2,999

1,000 to 1,999

Under 1,000 _..

Berwick, Maine (town)--.

Elliott, Maine (town)

Greenland, N. H. (town)_.
Hampton, N. H. (town).-.

Kittery, Maine (town)

Newcastle, N. H. (town)..
Newingtou, N. H. (town).

Population

(1930)

1,961

1,462

.-.. ! 577

1,507

4.400

378

381

Population
(WSO)

North Hampton, N. H. (town) --- 695

Portsmouth, N. H. (city) 14,495

Rye, N. H. (town) 1,081

South Berwick, Maine (town) .- 2,650

York, Maine (town)-— 2,532

Total -— 32, 119

' Cost data obtained from assessor's records represent 60 percent of cost of construction. For the pur-
poses of this table 40 percent has been added to the assessed valuations reported.

Prepared in the Bureau of Labor Statistics, U. S. Department of Labor, Division of Construction and
Public Employment.

Table 7. — Family-dwelling units provided in the Norfolk, Va., area as indicated
by building permits issued July 1940 to February 1941 inclusive, by cost class and
location of construction

Total

Location of construction

Permit valuation
per unit

Ports-
mouth,
city

Norfolk,
city

South

Norfolk,

city

Tanners
Creek
district

Western
Branch
district

Washing-
ton dis-
trict

Deep
Creek
district

TotaL _..

1,642

156

761

246

202

197

$5,000 and up

$4,000 to $4,999

$3,000 to $3.999

$2,000 to $2,999

$1,000 to $1.999

Under $1 000

123

141
234
924
135
85

15
96
36
3

97
87
94
430
42
11

1
3
5
5
3

5
16
75
108
25
17

14
27
29
120
5
7

1
1
5
21
13
22

5
11
144
11
25

F Prepared in'the Bureau of Labor Statistics, U.
Public Employment.

Department of Labor, Division of Construction and

g342 WASHINGTON HEARINGS

TESTIMONY OF SIDNEY HILLMAN— Resumed

TRAINING FOR MAXIMUM USE OF LOCAL I^ABOR SUPPLY

Mr. HiLLMAN. Now, as I have said, there are many considerations
besides housing which have made the Labor Division anxious to avert
a migratory-labor situation. I turn at this point to a brief descrip-
tion of some methods invoked to avoid and reduce this problem. In
a word, our major policy in supplying manpower to defense industries
has been that the fullest possible use should be made of the labor
supply that is locally resident in the vicinity of the defense plants.
The condition we have striven to bring about is the exact opposite of
a condition of migration. It involves the hiring, by defense em-
ployers, of the highest possible amounts of local labor, plus the
training of that labor to qualify it for the defense jobs of its locality.

We started on this training program in the first days of the defense
effort, last June. The Labor Division brought about the corrdina-
tion, for this work, of the U. S. Employment Service, the U. S. Office
of Education, the N. Y. A., and all other Federal agencies dealing
with defense training and employment. The Employment Service,
through its 1,500 offices throughout the country, enrolled and regis-
tered defense workers and gathered information on how many workers
and what kinds of skill the defense contractors would need in each
area.

REORGANIZATION INTO 12 REGIONS FOR PLACEMENT

It is this system which I have recently reorganized along lines
which extend and strengthen the accomplishments of the first year.
Also, the Nation has been divided into 12 regions and the same 12
Government units are combined under a single regional chairman,
who is in all cases the district representative of the Bureau of Em-
ployment Security. Thousands of defense contractors are being
contacted at regular 2-week intervals, so that we can ascertain their
future labor requirements and provide for them by finding the needed
workers. All this is being done with direct relation to the actual
needs of the defense employers.

O. P. M. urges defense contractors in all cases to utilize the U. S.
Employment Service which we have established, and the great ma-
jority of them are doing so.

During the first 11 months of the defense effort, the Bureau of Em-
ployment Security registered more than 6,500,000 workers, and placed
1,500,000 of them in jobs, for the most part defense jobs. Wherever
stringencies in certain skills appeared, our training program went into
operation.

IN-PLANT AND OUT-OF-PLANT TRAINING

There are two broad divisions of that program — training in voca-
tional classes outside of industry, and training within industry. Let
me briefly describe them.

The training outside of industry includes three kinds of classes.
There is the primary or preemployment training. There is the train-
ing for former skilled workers whose skills may have grown rusty
because they worked in other callings during the depression. And
there is the specialized training or supplementary courses, largely out-
of-hours courses for defense workers who desire to upgrade their skills.

NATIONAL DEFENSE MIGRATION 6343

Starting July 1, 1940, and up to May 31, 1941, 716,655 individual
workers were trained in the preemployment, refresher and supple-
mentary courses. Out-of-school youth, rural and nonrural, were
trained in vocational courses to the number of 132,253 individuals.
The W. P. A. has supported a great many of these trainees. The
vocational courses on the N. Y. A. work projects trained 125,000,
and the various engineering colleges trained 95,529. That is a total
of 1,059,347 persons trained, and in addition, on June 21, 1941, the
National Youth Administration had 354,936 young people employed
in its out-of-school work program. The Apprenticeship Unit of the
U. S. Department of Labor further reported 51,200 apprentices
working in various approved plants and shops.

I herewith submit Exhibit C, covering developments in labor
supply and training from July 1, 1940, up to a recent date.

The Chairman. Your exhibit will be received.

(The document referred to follows:)

Exhibit C— Report of Labor Supply a.nd Training

The Labor Division of the Office of Production Management has as one of its
major functions the provision of an adeciuate and continuous supply of trained
manpower for the defense program. The Labor Supply Branch of the Labor
Division brings together and guides the activities of the various governmental
units associated with the recruitment, training, and placement of workers for the
defense program. The execution of policies, plans, and operations are carried
out by the governmental units concerned, in conformity with Labor Division
policies arrived at by the Labor Supply Branch and approved by the Associate
Director General of the Office of Production Management.

The efficient use of the Nation's labor supply and training facilities requires
that the movement and training of workers be directed to the needs of the defense
program. This requires that the training programs be geared to the predictable
demands of defense employers in order to avoid wasting needed training facilities
on occupations in which there is no present or anticipated demand. Further-
more, in order to minimize unnecessary migration, local labor should be recruited
and trained as far as compatible with ])roductive efficiency, and importation of
workers or trainees should be discouraged except when local labor supply is ex-
hausted or when the pressure of time makes adequate local training impracticable.
When it is necessarj- to import workers to be trained, they should be selected care-
fully to meet the needs existing in the community. Only by careful planning and
shared responsibility can there be assured effective utilization of our training facil-
ities and our reserve of lalwr resources.

Sound policy dictates that from every point of view the present labor require-
ments of defense employers can be met best by making the most efficient use of
all reserves of labor. Training programs, both public and within the plant, should
be greatly intensified to supply workers in the numbers and occupations needed
on the one hand and to use fully the skills of workers already employed on the
other.

As priorities on raw materials and machinery are made, there must be effective
arrangements for the placements of those who may be displaced through the opera-
tion of priorities. Otherwise, displacements will occur in the labor market,
resulting in wasteful and inefficient use of manpower.

government agencies working on labor supply

The following governmental units are carrying out assigned responsibilities and
functions at the regional, State, and local levels in order to secure an adequate
supplj^ of trained manpower for the defense program:

United States Employment Service, Bureau qf Employment Security, Social

Security Board, Federal Security Agency.
United States Office of Education, Federal Security Agency.
National Youth Administration, Federal Security Agency.
Work Projects Administration, Federal Works Agency.
United States Civil Service Commission.

g344 WASHINGTON HEARINGS

Training- Within-Industry, Labor Division, Office of Production Management.
Federal Committee on Apprenticeship, Division of Labor Standards. Depart-
ment of Labor.

NATIONAL DEFENSE TRAINING PROGRAMS

Three constituent units of the Federal Security Agency are carrying out respon-
sibilities and functions in connection with the training of workers for defense
industries, which training is conducted outside of industry. These are as follows:

UNITED STATES EMPLOYMENT SERVICE, BUREAU OF EMPLOYMENT SECURITY,
SOCIAL SECURITY BOARD. FEDERAL SECURITY AGENCY

Through its 1,500 local employment-service offices, in connection with the
training program, collects and makes available labor-market information concern-
ing the supply of and demand for workers in both defense and nondefense occupa-
tions; determines the occupations and luimber for defense training; and selects
and refers persons to defense training courses.

UNITED STATES OFFICE OF EDUCATION, FEDERAL SECURITY AGENCY

The Vocational Training of Defense Workers Section of this Agency is respon-
sible for the major part of the vocational-training program for defense workers
operated by public schools. Through regional and field agents it cooperates with
the State and local boards of vocational education in the administration and super-
vision of the program. The present vocational training program for defense
vorkers provides for the following types of courses:

I. Preemploymetit courses for unemployed persons selected from the
employment-service registers, from Work Projects Administration proj-
ects, and National Youth Administration work projects.
II. Supplementary courses for employed persons and apprentices for the
purpose of expanding their skill and knowledge in essential or allied
defense occupations.
III. Preemployment vocational courses for out-of-school rural youth.

The Engineering Defense Training Section of this Agency is responsible for the
defense training courses provided by degrees-granting colleges and universities
designed to meet the shortage of engineers, chemists, phj^sicists, and production
superviros in fields essential to the national defense.

NATIONAL YOUTH ADMINISTRATION, YOUTH WORK DEFENSE PROGRAM, FEDERAL
SECURITY AGENCY

This Federal Agency's out-of-school work program for needy unemployed young
people between the ages of 17 and 24, inclusive, provides part-time employment in
resident and workshop projects which furnish work experience preparatory to
employment in defense occupations.

The policies governing the establishment and operation of the public defense
training program are briefly summarized as follows:

1. Defense occupations. — The List of Occupations, approved by the Office of
Production Management, for vocational-trraning courses for defense workers, lists
the occupations in which training may be given under tlie defense training program.
Instructions will be issued with reference to the emergence of a shortage of workers
in an occupation, or occupations, not included in tliis list. The determination of
training in occupations not included in this list will be referred through regular
channels to the Director of Defense Training of the Federal Security Agency and
by him to the Office of Production Management for approval or disapproval.

2. Supplementary courses. — Supplementary and extension courses for employed
workers are closely coordinated to the "training-within-industry" program,
including apprentice training. In the expenditure of funds for equipment for
vocational schools, first consideration will he given to facilities for supplementary
courses.

3. Preemployment courses. — In general, the number of trainees to be given
preemployment training should be restricted to the number of jobs in defense
industries which are now open or may be open within a reasonable period from
the time of the completion of the course. The number of workers to be given
training in excess of known needs and the occupations in which such training

NATIONAL DEFENSE MIGRATION 6345

should be given will be authorized by the Office of Production Management
through the Director of Defense Training.

4. Reserve labor resources. — (a) Women workers: The training of women
workers shall be related to existing or anticipated employment opportunities for
women in specific defense occupations. As the general labor market tightens,
the Office of Production Management will take steps to promote the employment
of women and will advise the Director of Defense Training from time to time in
what occupations, in what number, and in what places the training of women
shall be extended in accordance with such policy.

(6) Negro workers: There will be no discrimination because of race or color in
the selection of trainees for the defense training courses. Negroes will be trained
in selected occupations in communities where at the present time there may be
no employment opportunities for them, but in which it is probable that their
services will be used at a later date by defense contractors.

(c) Foreign-born workers and workers of foreign-born parentage: In view of
the prospective shortage of manpower, particular attention should be paid to the
training and placement of foreign-born workers and workers of foreign-born parent-
age in defense occupations in which there are employment opportunities.

(d) Conservation of farm labor: In view of the potential shortage of farm labor,
in certain regions in which the national policy requires an expansion of production,
the specific training of rural youth for defense occupations should be carried on
in relation not only to nonagricultural defense industries' labor requirements, but
also with due consideration to the defense agricultural labor requirements. The
Office of Production Management will determine and advise the Director of De-
fense Training, from time to time, the rural areas specifically affected.

I am submitting the information which is available through the United States
Office of Education on the enrollment in vocational defense training classes.
While these are for different periods, they are the latest available detailed figures.

The detailed figures available on net enrollments in defense training courses are
as follows :

Preemplovment refresher and supplementary courses (data as of May

31, 1941) 206, 124

Out-of-school rural and nonrural youth, vocational training courses

(data as of Mar. 31, 1941) 92,368

Vocational courses for vouth on Nptional Youth Administration work

projects (data as of Mar. 31) 87, 098

Engineering defense training courses (data as of Apr. 30) 95, 529

Total of all vocational defense training courses 481, 119

The estimated total number enrolled in defense training courses since the be-
ginning of each program is as follows:

Preemplovment refresher and supplementary courses (period July 1,

1940, to May 31, 1941) 706,655

Out-of-school rural and nonrural vouth in vocational training courses

(period Dec. 1, 1940, to Mar. 31^1941) 132,253

Vocational courses for vouth on National Youth Administration work

projects (period Dec.'l, 1940, through Mar. 31, 1941) 125,000

Engineering defense training courses (period Dec. 1, 1940, through Apr.

30, 1941) 95,529

Estimated total enrollments of all defense training programs 1, 059, 437

The National Youth Administration has submitted information as of June
21, 1941. At that time there were 354,936 youth employed on the National
Youth Administration out-of-school work program. Of these 91,882 were work-
ing on construction projects, 127,437 were employed in local workshops, 30,377
in resident work centers and 102,240 were doing such work as providing clerical
assistance to local governmental agencies, public health and hospital work,
recreational assistance to draft boards and mihtary establishments, etc.

The National Youth Administration work project employment in the local
workshop and work resident center is particularly identified with the defense-
training program. These work projects are related to the requirements of
defense industries and provide the young people part-time employment in order
to prepare and qualify them for employment in industry.

g346 WASHINGTON HEARINGS

National Dkfense Vocational Training Program

The latest available statistics on enrollment in preemployment-refresher and
supplementary courses as of May 31, 1941, appear in table 1 below. These data
have been reported by the States by wire to Washington. The circumstances
under which the States are able to submit enrollment figures within a short period
after the close of the month vary. Consequently, the reliability of these figures is
subject to some limitations. However, prior to the preparation of this table all
figures were subjected to certain procedures of statistical verification, such as com-
paring the figures for this month with those of previous reports and with trends.
The plan of telegraphic reports, though new to State authorities, appears to be in-
creasingly practicable. This, the third monthly telegraphic report, is considerably
more dependable than earlier reports. In cases where figures from States were
questioned as a result of statistical analysis, more dependable figures were pre-
pared by estimate and were substituted. These are indicated by footnotes in the
table.

The tentative enrollments shown in table 1, as of May 31, 1941, in preemploy-
ment-refresher and supplementary courses, were as follows:

Preemployment-
refresher courses

Supplementary
courses

Total number in training July 1, 1940, to May 31, 1941

Number concluding training by May 31, 1941

335, 381
264, 509

371,274
236, 022

Net enrollment on May 31, 1941

70, 872

135, 252

On May 31, 1941, the net enrollment in preemployment refresher courses as
reported in table 1 was 70,872 and in supplementary courses, 135,252. There
had been a total of 335,381 in preemployment refresher courses from the beginning
of the program to May 31, 1941, andatotal of 371,274 in supplementary courses
over the same period. Of the 335,381 enrollments in preemployment refresher
courses recorded to May 31, 1941, 70,872 were still in training, leaving a balance
of 264,509 enrollments for which training had been concluded. Of the latter,
approximately one-half represent individuals known to have concluded training
to secure employment. The report of employment from preemployment refresher
courses, 129,901, is not statistically comparable to the total enrollment figure,
335,381. The actual percentage of individuals who have been in training, who
are known to have secured employment, will appreciably exceed 50 percent.

Also contained in the present report is a detailed tabulation of individual course
reports as received in Washington for the out-of-school youth training program.
The figures in tables 2 and 3 were summarized at an earlier date by telegrams
received from the States. The data for the month of March indicate that at that
time new enrollments exceeded discontinued enrollments by more than 5,000 dur-
ing the month. The indications are that this program has continued to expand
rapidly. It is estimated that there will be 300,000 total enrollment in this program
by July 1, 1941. A small percentage of persons in training in this program are
females. However, as of March 31, 1941, 12,785 of the 92,368 active enrollments
reported, represented Negro registrations. Over 83 percent of enrollments on
that date were of trainees residing in rural territory. Reported also are 12,250
registrations of enrollees of the Civilian Conservation Corps and 3,630 youths from
the National Youth Administration.

As may be seen in tables 4 and 5, auto-mechanics courses and woodworking
courses are those in which there are the largest numbers of enrollments in the
out-of-school youth program. The smallest enrollment is found in metal-work
and electricity courses. There were, as of March 31, 1941, atotal of 8,981 enroll-
ments in the out-of-school youth program in the various specific preemployment
categories. It is expected that all of these will become preemployment courses
in the VE-ND program beginning July 1, 1941. That represents a small pro-
portion of the courses offered in the out-of-school youth program.

NATIONAL DEFENSE MIGRATION

6347

Table 1.^ — Report of enrollment in preemployment refresher and supplementary
courses, for month ending May SI, 1941

Preemployment refresher

Supplementary

State or Territory

Net enroll-
ment at
end of
period

Cumula-
tive enroll-
ment from

July 1940

Total
number
of persons
securing
employ-
ment from
July 1940

Net enroll-
ment at
end of
period

Cumula-
tive enroll-
ment from

July 1940

70, 872

335. 381

129, 901

135, 252

371, 274

442
180
118

6, 805
612
790
52
839

1,171
538

4,259

1, 614
204

1,124
602
913
497
869

2,040

3,527
775

1,067

1,178

421

156

337

1,610

109

10, 389

337

159

4,325
305

2,194

376

111

2,160

1,996

927

117

591

617

1,079

2,440

222

325

1.342

564

612

31, 652

3,447

8,879

■750

2,833

3,255

1,131

1 19, 000

9,511

1,166

5,324

1 4, 000

2,945

1, 163

1 6, 100

8,445

1 22, 000

2,097

2,511

1 4, 700

383

1,068

14, 163

291

58, 367

1,951

620

1 15, 000

2,003

7,278

35, 968

1,525

1 2, 700

636

5,601

1 6, 000

2,989

436

2,433

7,172

4,854

1 15, 000

1,008

1,739

360

1 1, 450

405

157

11,463

792

6,676

236

982

603

179

16, 844

4,196

433

2,093

1,270

639

166

4,347

4,309

6,774

595

863

1, ,591

228

106

414

6,699

14, 844
977
131

6,454

737

3,441

15, 989
800
645
212

1,318

944

740

290

999

1,933

1,127

3,853

209

630

113

325

1,951
0
1,356
16, 129
1,257
1,986

250
4,875
2,672
65
8,612
4,704

535

456
2,034
1,458

102
3,385
2,101
9,595

776
1,032

922

261

6,214

281

Arkansas

2,629

California

1 40, 000

13,230

Connecticut

Delaware

6,952
' 540

Florida

17,000

5,723

Idaho

118

122.000

1 12, 000

Iowa

I 2, 000

Kansas

1 1, 200
1 7, 500

Louisiana

2,855

Maine

531
1 11,000

Massachusetts

7,390

Michigan.

2, 341

Mississippi

1 3, 600

363

Nebraska

Nevada

217

476

3,520

410

20,277

1 649

1,201

New Jersey.

New Mexico

1 13, 500
999

New York

80, 982

North Carolina

1,729

North Dakota

2,128
700
920
11,859
389
551

9,528

Oklahoma

3,403

Oregon

3,107

27,099

Rhodelsland

824

South Carolina

1,670

South Dakota

1,582

6,754

1,509

289

3,632

3,510

1,113

1.829

1,830

870

900

I 3, 580

13,000

Texas

9,574

Utah

13,000

464

Virginia

11,827

12, 558

West Virginia...

3,781

Wisconsin

4,598

Wyoming

2,959

1,442

Hawaii

2,421

Puerto Rico

1 6, 211

I Estimated in lieu of verifiable State figures.

5348 WASHINGTON HEARINGS

Table 2. — Total enrollment in courses for out-of-school rural and nonrural youth
by States, for the month of March 1941

(General preemployment and specific preemployment courses combined]

State or Territory

Number of
courses
operated
during
month

(1)

New en-
rollment
during
month

Concluded
training
during
month

(3)

Net en-
rollment
at end of

month

(4)

Total en-
rollment
since start
of program

(5)

Total _

Alabama

Arizona

Arkansas

California

Colorado

Connecticut-
Delaware

Florida

Georgia

Idaho

Illinois

Indiana

Iowa

Kentucky

Louisiana

Maine

Maryland

M assachusetts -

Michigan.

Minnesota.

Mississippi..

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota.

Ohio

Oklahoma

Oregon

Pennsylvania

Khode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin...

Wyoming

District of Columbia.

Hawaii

Puerto Rico

7,415

45, 167

3,350
154

1,372
659
852

'""■76"

1,936

352

419

509

458

471

1,598

2,268

362

518

853

620

1,880

1,662

283

293

2,594

134

1,173

1,111

101

2,710

1,071

302

3,329

5,143

256

697

682

1,167

1,415

337

3,176

1,177

123

760

1,776
138
76
827
167
962
780
311
53
14
278

4,787
251

570
1,222

217

558

3,614

500

1,691

606

912

1,250

3,646

3,245

617

763

2,454

1,369

5,687

3,322

563

1,098

147

128

756

608

6,432

407

2,113

2,074

271

5,083

2,506

367

5,908

8,591

648

403

3,193

834

2,954

4,579

710

325

557

5,465
320

4,491
659

1,505

2,918

704

1,182

1,653

4,922

3,824

865

981

3,688

1,975

7,167

4,261

1,061

1,238

186

267

381

959

725

9,791

1,079

3,185

5,395

1,845

6,211

3,576

443

7,641

10, 979

952

486

4,690

1,042

4,414

5.622

1,120

3.80

117

1,044

NATIONAL DEFENSE MIGRATION

6349

Table 3. — Net enrollment in courses for out-of-school rural and nonrural youth,
by States, as of Mar. 31, 1941

[General preemployment and specific preemployment courses combined]

State or Territory

(2)

Negro

Civilian
Conserva-
tion Corps

National
Youth

tration
(6)

Total.

Alabama

Arizona

Arkansas

California

Colorado

Connecticut'

Delaware

Florida

Georgia

Idaho.

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia

Wisconsin

Wyoming

District of Columbia.

Hawaii

Puerto Rico

92, 368

76, 976

4,787
251

3,592
570

1,222

4,498
227

2,633
575

1,015

217

558

3,614

500

912
1,250
3,646
3,245

617

763
57
2,454
1,369
5,687
3,322

563
1.098

147

128
79

756

608
6,432

407
2,113
2,074

271

5,083

2,506

8,591
648
403

3,193
834

2,954

4,579
710
325
91
557

110

130

662

161

1,134

143

2,244

1,217

159

101

739

778

1,953

824

268

178
429

3,306
401

1,311
474
700
798

3,439

2,408
571
505
51

1,707
969

4,922

1,951
541
953
70

377
5,292

1,655
1,399

238

4,578

2,129

204
5,377
7,422

505

393
2,477

587
2.667

12, 250

1,310
117
508
97
245

205

322

139

266

508

136

740

1,142

249

101

100

136

251

277

1,199

336

1,150

696

512

229

154

292

12
1
604
60
4
11
38
34
327
0
10
100
0
85
120
61
90
22
19
0
0
0
0
7
123
20

Figures not yet available.

6350

WASHINGTON HEARINGS

Table 4. — Net enrollment in courses for youth on National Youth Administration
work projects, by States, as of Mar. SI, 1941

Alabama 3, 426

Arizona 269

Arkansas 1, 989

California 800

Colorado 701

Connecticut 326

Delaware 243

Florida 1, 328

Georgia 1,011

Idaho 268

Illinois 2, 507

Indiana 1, 691

Iowa 1,024

Kansas 719

Kentucky 2,284

Louisiana 860

Maine 4. 090

Maryland 407

Massachusetts 10

Michigan 2, 648

Minnesota 1, 226

Mississippi 2, 411

Missouri 2, 808

Montana 131

Nebraska 1, 408

Nevada 46

New Jersey 2, 984

New Mexico 1, 279

New York 4, 477

North Carolina 5, 642

North Dakota 552

Ohio 6,927

Oklahoma 841

Oregon 1, 145

Pennsylvania 7, 120

South'Carolina 2, 278

South Dakota 76

Tennessee 1, 099

Texas 7, 088

Utah 636

Vermont 273

Virginia 2, 996

Washington 861

West Virginia 1, 303

Wisconsin 3, 084

District of Columbia 768

Puerto Rico 1,038

Total 87,098

Table 4-A. — Number of youth terminated because they secured private employment —
out-of-school work program, July 1940 through May 1941

1940:

July 14,500

August 13,490

September 17,093

October 18,234

November 16,844

December 16, 009

1941:

January 22,437

February 31,596

March 38, 852

April 43,058

May 47,54a

Total.

279, 653

Table 4-B. — Number of production units on workshop-production projects —
out-of-school work program, May 1941

Number of production units

Type of production activity

Total

Resident
projects

Non resi-
dent
projects

Total

5,419

998

4,42t

1,006

223

783.

Machine shop

407
308
209

76
73
58
16

331

23&

Welding

151

Foundry

Radio and electrical (total) . - .-

349

257

192
157

56
36

136

Electrical . .

121

NATIONAL DEFENSE MIGRATION

6351

Table 4-B. — Number of production iinits on workshop-production projects-
oui-of-school work program, May 1941 — Continued

Number of production units

Type of production activity

Total

Resident
projects

Non resi-
dent
projects

604

114

490

506
53
45

74
21
19

432

Aviation services -

i;567

148
303

1,155

Sewing (total)

1,264

302
1,265

25
278

277

Domestic -

987

590

118

472

272
318

223

249

Table A-C. ^Report of the number of resident centers in operation and under
construction — out-of-school work program, May 31, 1941

Number of resident
centers

State or territory

Number of resident
centers

state or territory

Total

In ope-
ration

Under
con-
struc-
tion

Total

In oper-
ation

Under
con-
struc-
tion

667

622

16
21
16

8
46

6
16

1
85

8
19
64

1
16
2
6
18
1
2
2

16
17
16

8
45

6
12

1
83

8
19
61

1
16

6
16

2
2

Alabama . . ..

38
4
12
13
11
2
8
23
4
21
8
4
32
14
33
5
2
2
14
7
18
6
3

12
7

34
4
10
12

4
21

3
31
12
32

2
9

7
16

3
12

4
2

1
2

New York City and

New York (excluding

New York City)

North Carolina

Colorado

Ohio

Pennsylvania

Rhode Island

South Carolina -

Kansas

South Dakota

Kentucky

Maine

Utah

Maryland

Michigan

Minnesota

West Virginia

Wisconsin

Nebraska

Virgin Islands

New Hampshire

60396— 41— pt. 1(

^352 WASHINGTON HEARINGS

Table 5. — Net enrollment in preemployment refresher and supplementary courses,
by city and Stale, as of Mar. 31, 1941

state and city

Preem-
ploy-
mont

refresher

Supple-
mentary

State and city

Preem-
ploy-
ment
refresher

Supple-
mentary

ALABAMA

18
39
160

CAUFO RNi A— continued
Lodi

1,021

435

186

■r.

26
208
29

I/Ong Beach

429

1,664

Modesto

13
49
123

344
294

30
132

146

Mobile

Moorpark

Napa

National City

125
30
40

153
69
16

333

118
33
17
82
46
15
25
67
12

127

893
66
48

224

87
18
17
198
36

197

North Hollywood

CShpffioIrl

Norwalk

124
16

Oakland

510

University

Ontario --

542

1,081

154

Porterville

PhnpniY

112
25

Redondo Beach

Rio Vista

Total

137

154

Riverside

24
20

Sacramento

Salinas

234

San Francisco

425

27
10

Danville

San Luis Obispo..

De Witt

8
134

San Pedro

108

Fayetteville

Santa Barbara

20
55

Santa Maria

25
10

809

South Gates

14
10
13
499

127

10
11
12

Taft

Vallejo

634

14
40
9
26

Van Nuys

Venice .

67
43
45

138

Mena

Ventura

88
9

Total

Pine Bluff

30
25
91
17

6,192

12 936

COLORADO

29
18
171
11
39

Total

228

1.049

Colorado Springs

343
73

42
89
9

37
58

103
119

Greelev

Alhambra

Pueblo

113
41

Antioch

Trinidad

Total

Berkeley

276

2,870

422

765

RoT-orlrr TTillo

CONNECTICUT

Burbank

189
83
24
19

A-usonia

18
14

293
32
15
20

215
37
29
19
41
47
30
36

619

El Centre

19
36

Danbury

74
58

81
136

140

Hartford

662

211

30
260
104

774
763

Glendale _.

Middletown

Huntington Park

New Britain

Now Haven . . .

197

Inglewood

Kentfield

La Verne -

ioo

Norwich

NATIONAL DEFENSE MIGRATION 6353

Table 5. — Net enrollment in preemployment refresher and supplementary courses,
by city and State, as of Mar. SI, 1941 — Continued

State and city

Preem-
ploy-
ment

refresher

Supple-
mentary

State and city

Preem-
ploy-
ment
refresher

Supple-
mentary

CONNECTICUT— continued

ILLINOIS

Alton

116

Roclcvme

13
36
19
39
39

Athens

1
24

104
57
16

Aurora

^ aterbury

Carterville

136

2.781

Williniantic

Champaign

139

Chicago

Colchester

817

Total - --

992

1,855

Crystal Lake

DELAWARE

Danville

Dundee.-

Bridgeville

East Moline

116

Camden .

East St. Louis

Elgin

145

Clayniont ...

36
79

114

Total

126

223

Kankakee

La Salle

36
26
35

Avon Park ..

Lockport

124

Bushnell

42
342
23
21
81.';
14
43
212
69
66
12
12
61

65
64
81

319
42
77
359
100
46
411
12
129
219

Daytona Beach

Moline

66
30

279

Jacksonville

Ottawa

Key West

Peoria

230

Lakeland

Miami

Ocala

Rock Island

139

Ocoee -

Springfield

Orlando

Urbana

145

Perry

92
44
29

313

Pcnsacola .

425
38
22
67

West Frankfort

St. Petersburg .

Wood River

243

Total

Wild wood

3,853

5,128

INDIANA

Total

1,953

2,283

72
54

351

127
9

304
11

210
43

184
26
79
12
27
73
19
22
18

928
29

Albany .

Anderson

124

Athens

25
12

Atlanta...

321
44

Bedford .

A ugusta

Bicknell

46
18

Carlisle . ...

136

Dublin

Dugger . .

55
41

East Point

East Chicago

163

Elberton

Elkhart City

Fort Benning

Elwood - ...

54
95
15
22
100
403
10
42

Fort Valley

Evansville

397

Macon

156

Frankfort . .

Marietta

Gary

196

208

631

179

La Favette

Total

649

24
26
74
29
144
101

2,598

La Porte

12
18
13
13
13
11
34
33
21
16
12

Boise

Martinsville

McCall

122

Moscow

M ishawaka

Nampa

Monticello

Weiser .

New Albany

Total

398

Pleasantville

5354 WASHINGTON HEARINGS

Table 5. — Net enrollment in f reemployment refresher and supplementary conrseSf
by city and State, as of Mar. 31, 1941 — Continued

State and city

Preem-

ploy-

ment

refresher

Supple-
mentary

State and city

Prcem-

ploy-

ment

refresher

Supple-
mentary

INDIANA— continued
Princeton

12
13
29
23
55
21

MARYLAND

Annapolis

12
562

Richmond

30
318

Baltimore

1 689

South Bend

Cumberland

Elkton .

13
20
53

31
272
44

Terre Haute

Hagerstown

Vincennes

24
17

548

Whiting

322

70
12

Total

1,339

3,256

Westminster

995

MASSACHUSETTS

Boston

121

84
178
38

10
78
129

105
36
53
107
121

Davenport

49
135

396

DubuQue

Brookline

Fort Madi=on

Cambridge

Sioux City

East Boston

135

14
29
29
36
117
31

308

724

Fall River

6S
1, 166

253

Kansas City

Greenfield

Holyoke

127

Total

1,234

269

Hyde Park

15
48

27
55
11
83
39
28
32
79
26
50
29

KENTUCKY

108

118
15

142
76
97

103

444
280

Leominster

Medford

New Bedford

201

91
285
420

Paintsville

Northampton - . -

Pittsfield

184

Total

659

1,906

Southbridge

Springfield

309

LOUISIANA

635

Taunton

Alexandria

Waltham _._.

Westfleld

60
138

15
66

306

Total -

Camp Beauregard

47
94

1,381

2,309

95
19
77
37
79
136
107
63
90

MICHIGAN

Battle Creek

Hammond

70
45
20
97
2,410
13

115
93

193
56
38

110
35

149
30
28
97
69
48
18
37

133

Opelousas

Bay City

127

Shreveport

154
18

Dearborn

4, 588

Winnfield

Ecorse - -

Total

784

971

Grand Rapids.

131

144

MAINE

Highland Park

Auburn

Houghton

Ironwood

Bath

18
123

150

Portland

35
207
10
19

Lansing

103

Waterville

Muskegon.—

Negaunee - - .

103

Wcstbrook

327

141

River Ilouge

134

NATIONAL DEFENSE MIGRATION

6355

Table 5.

-Net enrollment in preemployment refresher and supplementary courses,
by city and State, as of Mar. 31, 1941 — Continued

state and city

Preem-
ploy-
ment
refresher

Supple-
mentary

State and city

Preem-
ploy-
ment
refresher

Supple-
mentary

MICHIGAN— continued

15
15
135
27
31
9
12

MONTANA

28
146
70

Saginaw

300

29
213

Miles City

Total

Wayne

244

NEBRASKA

Ypsilanti

28
95

Total

4,015

6,370

Omaha

Total

MINNESOTA

39
25

123

NEVADA

Carlin

46
116

Duluth

78
12
10
10
52
24
30

Elko

Faribault

Sparks

123

Total ._.-

10
14
48

315
23
24

146
32

383
14

314

NEW HAMPSHIRE

Berlin .

12
15
29
28
11

136
16

St Cloud

40
16
11
95

Dover - - - .

St. Paul

Franklin

Laconia

52
11
14
59

15
12

Total

614

1,279

224

28
32
59

Total - - -

A Icorn

244

433

NEW JERSEY

Atlantic City

Clarksdale

24
175
13
126
20
141
113
78
320
42
25
26
151
55
47
50
70
12

Greenville

60
36
112
176
75
14
16
54
55
31
52

Gulfport

36
651
34
30

Bayonne -

205

Hattiesburg

Belleville

668

Elizabeth

188

385

121
10

Jersey City

118

1,070

Vicksburg

p "^jp

Total

800

912

Paterson

401

19
11
13
11
10

Trenton

Cape Girardeau

West Orange

Woodbridge

Total

1,488

3,634

NEW MEXICO

Jefferson City

46
67
340

Joplin

Kansas City

103

Clayton

Maplewood

Clovis

16
1.34

32
110
209

Hobbs

North Kansas City

St. Charles

I/as Vegas

86
111

588

St. Joseph

State College

St. Louis

Total --

132

365

NEW YORK

Albany

Alfred

49
32

Total

1,116

953

307

282

6356

WASHINGTON HEARINGS

Table 5. — Net enrollment in -preemployment refresher and supplementary cotirses,
by city and State, as of Mar. SI, ^9^/— Continued

state and city

Pieem-
Ploy-
nient

refresher

Sur^ple-
mentary

State and city

Preem-

ploy-

ment

refreshrr

Supple-
mentary

NEW YORK— continued

42
240
60
24
25
98

180
356

NEW YORK— continued

36
263

266

Baldwin

Barker

Total

NOHTH CAEOI.INA

Canton ..

127
40
114

554

625

2, 661

5,146

12,023

22, 529

Batavia

Beacon

Bellmore

57
65
44£
1,345
1, 9/4
92

Charlotte

Brooklyn

Buffalo

Oastonia

Ooldsboro

12
43

College Park

Fayette ville

Greensboro

High Point

22
51
58
10
85

38
36

Cortland

71
105
141
107
140
347

East Rochester

Raleigh

Elmhurst

94
88
178
255
IG
217

Salisbury

Elmira

Wilmington .

EIrr.ira Heights

Winston-Salem

Total

Frankfort

362

227

NORTH DAKOTA

Ellendale . -

19
7
12

Olens Falls

156
18
82
19

Hastings-on-the-Hudson

Hempstead

Mandan

Valley City.-

Total

Homell

37
80
31
17
23
41

OHIO

Akron

Ilion

74
78
99

495
47

640

133
25
13
17

Ithaca

Ashland

149

23
48
151
619
18
597
42
58
13
53
30
28

152
398

"14

Long Island City

Lynbrook

174
89

Cincinnati . .

30
64

72
2,588
602
182
85
37

Circleville

Cleveland

Mount V'ernon

1.417

Columbus - -

New Rochelle

New York City

Defiance

Niagara Falls

Delaware

Norwich

Elvria

Nyack

38
53
38

Findlay . .

Olean ""

105
16
182

Oneonta

Iron ton

58
32
37

16
74
48
126
30
19
50
1,906
83
35
28

Oyster Bay

Lancaster

Pearl River

Lima . . .

21
126
11
42
16
36
75
43
-52
P9
80
11
S9
35
23
352
14

Port Chester

123

Lorain.

123

Potsdam

Mansfield ..

67
792
276

Rochester

Massillon

Rome

Middletown . .

Saranac Lake

Nnpoleon

Scotia

169
295

Nelsor ville...

Newark

239

Spring Valley

196

569

30
294

Staten Island

304

1,267

1,014

Portsmouth

Utica

Svlvania ..

Toledo...

179

149
41
70

Van Wert

Watervliet

Wadsworth

White Plains

Washington O. H

NATIONAL DEFENSE MIGRATION 6357

Table 5 — Net enrollment in preemployment refresher and supplementary courses^
by city and State, as of Mar. 31, i 9-^1— Continued

State and city

Preem-

plOV-

ment
refresher

Supple-
mentary

State and city

Preem-

ploy

ment

refresher

Supple-
mentary

OHIO— continued

246

PENNSYLVANIA— continued
Erie

230

30
5

238-

Forty Pert

84
63

GirardviUe

Hanover

35
88
18
40
15
16
28
19
54
66

Total

3,493
33

1.388

66
43
19
18
20
46
20

Her'^hev

658-

102

BartlesvUle

Broken Bow

Cache -

Lancaster..

Collinsville

Dnimright

Enid

Guthrie

15
14

Jay

75
96
65
29
37
13
67
14

14
18
14
44
29

462

Muskogee

Oklahoma City -- .

78
42

Monessen..

Ponca City --

Shawnee

Stillwater

149
74

Oakdile

Tulsa

241

2,349
10
845
18
17
34
110
11

4,956

Total...

465

866

Phoenix ville

OREGON

152
10
15
25
282
13
23
57
16
37
154
159
664
148
23

Pittshursfh

397

Astoria

Baker

Chemawa

133

Grants Pass

Kan in

191
60
33
30
16
16
14
15
64
95
13

JohnDay.

Kiaam.,

La Grande

Medford

Ontario

Oregon City

Pendleton

Portland

662

Salem

The Dalles

Trevorton .--

Total

1.778

917

Turtle Creek

Tvrone

PENNSYLVANIA

120
137
32
32
31
12
35
30
92
12

Wilkes-Barre..

29
347
16

35
M
43

6. 651

419

317

Woodlyn

York -

Andreas

New Cnstle

Arnold

Total .-

Ashland

9, 138

Beaver Foils

RHODE ISLAND

Newport

Beavertown

Bethlehem

Bloomsburg

155

46.

Braddock.

Bristol .

17
21
15
51
60
45
63
61
32
67

51
209

SOUTH CAROUNA

22
61
10
52
71
15
9

Carlisle

196

129

Clemson

Moultrieville

6fr

30
73

Greenville

54
22

46.

East Stroudsburg

Orangeburg

6358

WASHINGTON HEARINGS

Table 5. — Net enrollment in preemployment refresher and supplementary courses,
by city and State, as of Mar. 31, 1941 — Continued

State and city

Preem-
ploy-
ment

refresher

Supple-
mentary

State and city

Preem-
ploy-
ment

refresher

Supple-
mentary

SOUTH CAROLINA— con.

VEKMONT

Chittenden

21
12

Total

316

409

St. Johnsbury . . .

152

112

Total

228

. . J

VIRGIXIA

Vermilion

189

Total

Bristol

111
52
44
24
21

185

Danville

459
16

Ettrick

415

Lynchburg .-

170

156
20

196

966

Cookeville

Norfolk

436

Portsmouth . - . . _

672

Radford

175

21
47
104
38

Richmond

92
136

279

Memphis

Nashville

235
299

Schoolfield

Tullahoma

Suffolk .._ - .

Whitehaven

466

Waynesboro

Total

1,430

685

588

3.876

WASHINGTON

Bellingham - . .

TEXAS

Amarillo

Arlington

59
152
80

1,010

Big Sprins;

92
20
115
25
376
204
127

Kirkland .- .

211

20
112
587

24
256

26
186
41
74
97
92

788

El Paso

190

339

Galveston

Vancouver

211
93
26

Total ---

Kilgore

150
26
24
54
13
71
56
47
73

252

551

2,621

Lamesa....

Laredo

WEST VIRGINIA

Belle

25
30
195
153
54
51
19
109
156
162
29

Marfa

Marshall

Benwood

325

Odessa

Huntington -- - .

217

Orange

Institute

Pampa

Martinsburg

Montgomery - ...

San Antonio

112
80
22
25

1,859

Tyler

Waco

Wichita Falls

Wheeling

Total

1,811

983

12
63

19
122
212
13
86
9

WISCONSIN

Antigo

^ppleton

101

35
22
36
95
24
68

130
13

132
41
47
29
86

100
66
17
29

Copperton

Ashland

Beaver Dam

Beloit

Lehi

Logan

174

Murray

Cudahy

Eau Claire

Oi'den

151

51
21
255
45
10
31

108

Price

Fort Atkinson

Provo

35
302
39

Janesville

Sandy

Kaukauna

Spani'^h Fork

13
139

Tooele

Total

805

1,086

Marshfield"

NATION.YL DEFENSE MIGRATION

6359

Table 5. — Net enrollment in ^reemployment refresher and supplementary courses,
by city and State, as of Mar. 31, 1941 — Continued

State and city

Preem-
ploy-
ment

refresher

Supple-
mentary

State and city

Preem-
ploy-
ment

refresher

Supple-
mentary

WISCONSIN— continued

5
24
13

301
8
24
23
93
43
49
23
27
43

169
16
14
46
76

247
22
76

WYOMING— continued

Menomonie

Rock Springs

Merrill

Sheridan

681

Neenah

Yoder

Total

236

998

115
14

DISTRICT OF COLUMBIA

Washineton

Rhinelander

301

South Milwaukee

564

HAWAII

Honolulu

Stevens Point

115
115

'""28

140

Watertown

Pearl Harbor

712

Waukesha

Total

PUERTO RICO

Arecibo

Caguas

G uay ama

864

41
17

22
59
39
62
43
46
76

Total

2,435

1,360

WYOMING

686

67
54
14

Ponce

56
45

Cheyenne

Santurce - . _ .

245

Vesa Baja

3,123

12
81

Total.

347

3,580

T ithtIo

United States total

Lusk

66, 028

109, 097

Statement by United States Office of Education,
Agency, Washington, D. C.

Federal Security

report for month ending APRIL 30, 1941 BY ENGINEERING DEFENSE TRAINING

The current status of the engineering defense training program is clearly indi-
cated by the attached tables:

Table 1: Summary of Status of program on April 30, 1941, as compared with
March 29, 1941. This shows net increments of three institutions, 318 approved
proposals, 17,967 students, and $1,307,634 in allotments.

Table 2: Authorized enrollment in engineering defense training courses on
April 30, 1941 (by classification of course and type of authorization). Mechanical
and industrial engineering are, as might be expected, among the fields leading in
enrollment.

Table 3: Summary of engineering defense training program on April 30, 1941
(by States). While engineering defense training courses are being given in nearly
all of the States, the larger enrollments are in the States which are highly indus-
trialized.

Table 4: Authorized enrollment in engineering defense training courses on
April 30, 1941 (by States, institutions, and type of authorization). In this tabu-
lation is given the approved enrollment at each participating institution.

Table 5: Monthly summary of disbursements to engineering schools through
April 30, 1941 (by States). This table shows the monthly rate at which engineering
defense training funds have flowed to the various States.

Table 6: Allotment of funds through April 30, 1941 (by States, institutions, and
type of allotment). Disbursements and encumbrances of engineering defense
training funds to each of the participating institutions is shown.

In most of these tables a distinction is made between figures derived from pre-
liminary authorizations and those from final authorizations. A preliminary author-
ization "must be procured before instruction in a course can be started , for this
reason enrollment and cost figures, although held within definite limitations, are

5360 WASHINGTON HEARINGS

subject to later revision. This revision is made in the final authorization, which
is based upon not less than 2 weeks of class experience. Since a final authoriza-
tion automatically cancels the preliminary authorization for the course in question,
there is no duplication in the two categories.

The engineering defense training program is now operating in 46 States, the
District of Columbia, and Puerto Rico.

R. A. Seaton,
Director, Engineering Defense Training.

Table 1. — Summary of status of program on Apr. SO, 1941, as compared with Mar.
29, 1941, of engineering defense training

Item

Mar. 29

Apr. 30

Number of institutions with approved proposals for courses

Number of approved proposals for courses

133
1,093

136
1,411

Allotment of funds-

$2, 551, 461
2, 509, 408

$3, 378, 479
2, 989, 754

Encumbrances

Total

5, 060, 869

6, 368, 503

Authorized student enrollment:
Final authorization

35, 498
42, 064

50, 608

44,921

Total

77, 562

95 529

Table 2.— Authorized enrollment in engineering defense training courses on Apr. SO

1941
[By classification of course and type of authorization!

C!ourse classification

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

Aeronautical engineering:

Fundamentals

Aircraft (complete planes)

652

343

1,992

1,598

470

870

714

1,685

1,122
1 213

2,706

Other

3,283

Total

4,585

3,739

8,324

Architectural engineering

148

Basic sciences:
Mathematics

682
0

174
310

856

Other

310

Total -

682

484

1,166

Chemical engineering:
Inspection and testing

353
519
411
412

215

1,235

712

56S

1,754

Production

506

Other

1,124

Total . .

1,695

2,257

3.952

Civil engineering:

276

1,164
850
758

248

765
665
476

524

Structures

1,929

1,515

Other

1,234

Total

3,048

2,154

5 202

Electrical engineering:
Fundamentals

504
800
550

375

461
510
598

879

1,261

1,060

Other

1,458

Total — —

2,714

1,944

4,658

NATIONAL DEFENSE MIGRATION

6361

Table 2. — Authorized enrollment in engineering defense training courses on Apr. 30,
1941— Continued

Course classification

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

General engineering:

400

11, 193

192

4,375

3,127

275

4,775

Engineer drawing and design geometry

14,320

Other

467

Total ---

11,785

7,777

19, 562

Industrial engineering:

911

5,567

3,824

716

570
3,473
3,325

525

1,481

9,040

Production supervision -

7,149

1,241

Total.- .—

11,018

7,893

18, 911

Marine engineering and naval architecture:

Hulls

1,438
333
183

320
230
645

1,758

563

Other

828

Total

1,954

1,195

3,149

Mechanical engineering:

1.016

3,462

249

3,076

1,686

273

501

655
3,231

635
2,483
3,025

352

491

1,671

6,693

884

5.559

Tools and dies

4,711

625

992

Total

10, 263

10, 872

21, 135

Metallurgical engineering:

Metallurgy and metallography

1,746
365
423

3,067

125

2,914

4,813

490

Other - -

3,337

Total — - -

2,534

6,106

8,640

Mining engineering - ---

Unclassified

500

587

50,608

44,921

95,529

Table 3. — Summary of engineering defense training program on Apr. SO, 1941]

[By States]

State

Number of

institu-
tions offer-
ing engi-
neering de-
fense train-
ing

Authorized
student en-
rollment

Total
funds al-
lotted

Alabama

5
4
2
1
1
1
3
3
2
2
2
4
1
2

3,900
18
41
5,755
1.380
3,881

468
1,509

200
4,863
6,704

1,229
548
295
659

1,755

$169, 538

2, 131

1,450

California

254, 762

85, 338

147, 361

18,533

Florida

152. 697

16,816

Illinois -

152. 654

224.600

20. 741

82, 181

25, 044

21,551

18, 878

Maryland-.- ---

98,188

5362 WASHINGTON HEARINGS

Table 3. — Summary of engineering defense training program on Apr. 30, 1941 —

Continued

State

Number of

institu-
tions offer-
ing engi-
neering de-
fense train-
ing

Authorized
student en-
rollment

Total
funds al-
lotted

1
2

4
2

3
1
9
3

11
2
4
1
3
6
2
2
3
3
1
2
1
3
1

1,731

'547

12s

988

155

203

1,951

135

5,820

725

131

5,291

1,507

30, 382

408

530

702
1, 487

268

1.306

916

1,784

140
1,789

139

$135, 422

Michisan

103 205

79, 490

Mississii)pi

20, 390

71 100

9, 172

Nevada

781

9,810

New Jersev

205, 493

New York

442, 139

North Carolina

103, 213

20, 807

Ohio - . - - - - -

285, 829

Olclahoma

57, 373

2,096

Pennsylvania

2, 737, 673

Rhode Island

16, 977

40, 601

South Dakota

2:438

29, 194

Texas

195, 319

Utah

25, 790

5, 556

Virginia

69, 386

24. 486

West Vircinia

72, 324

7,419

Wyoming

9,280

District of Columbia

67, 149

Total

136

95, 529

6 368 503

Table 4. — Authorized enrollment in engineering defense training courses on Apr. 30,

1941
[By States, institutions, and type of authorization]

Authorized student enrollment (Mar. 29):

Final authorization 35,498

Preliminary authorization 42, 064

Total 77,562

Authorized student enrollment (Apr. 30):

Final authorization 60,608

Preliminary authorization 44, 921

Total. 95,529

Institution

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

Alabama-
Alabama Polytechnic In'^titute

539

1,140
2,221

1,679

2,221

State total

539

3,361

3,900

Arizona: University of Arizona

State total .

Arkansas: University of Arkansas

State total

California:

409
285

3,505
40

4,200

University of Santa Clara

Stanford Universitv

3^2
330

751

University of Southern California

615

State total

1,538

4,217

5.755

NATIONAL DEFENSE MIGRATION

6363

Table 4. — Authorized enrollment in engineering defense training courses on Apr. 30,
1941 — Continued

Institution

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

Colorado:

189
43
446

173

175'
219
105

189

Colorado State College of Aericulture and Mechanic Arts

University of Colorado

218
695

278

State total

851

529

1,380

Connecticut:

University of Connecticut

1,197
1,094

510
1,080

1,707

2,174

State total

2,291

1,590

3,881

448

468

448

468

Florida' University of Florida

499

1,010

1,509

State total

499

1,010

1,509

116

200

State total

116

200

niinois:

Bradley Polytechnic Institute

157
1,357

55
3,149

145

212

4,506

Northwestern University

145

1,514

3,349

4,833

Indiana:

261
954
475

261

Purdue University

4,994
20

5,948

Rose Polytechnic Institute—

495

State total

1,690

5,014

6,704

Iowa:

Iowa State College

146
437

75
30

221

467

State total

583

105

688

Kansas:

Kansas State College

101
198

430
500

531

698

State total-

299

930

1.229

Kentucky:

University of Kentucky

143
345

10
50

153

395

State total

488

548

Louisiana:

Louisiana Polytechnic Institute

11
68
16
170

Tulane University

170

State total

265

295

Maine: University of Maine

544

559

544

559

Maryland:

595
628

82
450

677

University of Maryland -

1,078

State total...-

1,223

532

1,755

Massachusetts:

Harvard University

25
447
339

265
30

712

Northeastern University.

369

0364 WASHINGTON HEARINGS

Table 4. — Authorized enrollment in engineering defense training courses on Apr. SO,
1941 — Continued

Institution

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

Massachusetts— Continued.

336

77
42

170

506

Worcester Polytechnic Institute

Massachusetts State College

State total

1.266

465

1 731

Michigan:

Lawrence Institute of Technology

285

Detroit Institute of Technology

2S7
156
139
35
25

287

Michigan State College

156

380
861
74

519

Wayne University

896

Michigan College of Mining and Technology

State total

1.359

927

2,286

272

275

547

State total

272

275

547

Mississippi' Mississippi State College

128

Missouri:

61
771

Washington University

156

927

832

156

938

Nebraska" University of Nebraska

155

State total

155

State total

New Hampshire: University of New Hampshire..

108

203

108

New Jersey:

489

480
50
20

300

969

Rutgers University

399
213

419

513

State total

3,101

850

1,951

New Mexico:

New Mexico State College

63"

110

Sta*^e total

135

New York:

Cornell University

1,191
313

198
709

120

1,311
313

345

Union College

709

80
28
286

College of the City or New York -

261

289

Columbia University

286

691
169
362

369

New York University

698

1,389

Pratt Institute

169

362

State total

4,263

1,557

5 820

North Carolina:

Agricultural and Technical College .

27
437

60
189

626

State total

476

249

725

NATIONAL DEFENSE MIGRATION

6365

Table 4 — Authorized enrollment in engineering defense training courses on Apr. SO,
1941— Conthmed

Institution

Final au-
thorization

Prelimi- Total au-
nary au- thorized en-
thorization rollment

131

State total

131

Ohio:

441
749
360
322
610
760
125
315
301

47
480
24

488

1,229

384

322

Ohio State University

247
165

857

TTnivorsitv nf Tolwio - -

925

125

70
275

385

576

State total

3,983

1,308

5.291

47
86
169

165
1,040

212

University of Oklahoma

1,126

University of Tulsa

169

State total

302

1,205

1,507

Oregon: Oregon State Collece

State total

Pennsylvania: _ .„ ^ ,

2,441
235
273

1,993
618
355
142

1,565
46

7,097

1,975

840

3,281

235

Lehieh University

1,575
180

303

3, 568

798

Villanova College

355

■Rnnlrnoll TTnivorsifv

142

Carnegie Institute of Technology

1,590

10, 992

18, 089

1,975

State total

16, 740

13,642

30, .382

Rhode Island-

156
147

105

261

147

State total

303

105

408

South Carolina:
The Citadel

190
43
167

270

167

State Acrricultural and Mechanical College

State total

400

130

530

State total

Tennessee:

35
25
70

397
175

422

245

State total ..-

572

130

702

Texas:

Aericultural and Mechanical College of Texas

101
286
36
9
48
16

465
24
70
40

392

566

310

Texas College of Arts and Industries

106

440

Collcc of Mines and Metallurgy

State total

1 «e

991

1. 487

6366

WASHINGTON HEARINGS

Table 4:.— Authorized enrollment in engineering defense training courses on Apr. 30,
1941 — Continued

Institution

Final au-
thorization

Prelimi-
nary au-
thorization

Total au-
thorized en-
rollment

Utah:

Utah State Agricultural College

43
225

University of Utah

225

268

Vermont-

60
20

University of Vermont

State total.

Virginia;

Virginia Military Institute

84
607
500

Virginia Polytechnic Institute

632

University of Virginia. _. .

500

State total

1,191

115

1 306

Washington:

Gonzaga University

21
25
825

State College of Washington

State total

871

916

West Virginia: West Virginia University

1,750

1 784

1,759

Wisconsin:

University of Wisconsin

130

State total

130

146

District of Columbia:

Catholic University of America

1,020
190

362
118

1,382

Howard University

308

Total

480

1,309

1,789

Puerto Rico: University of Puerto Rico

139

Total .

Grand total ' _.

50, 608

44, 921

95,529

Table 5. — Monthly summary of disbursements for engineering defense training to
engineering schools through Apr. SO, 1941

[By States]

States

December

January

February

March

iVpril

Total

Alabama .

$29, 653
2,131

$29 653

Arizona

2 131

$1,450
6,200
8,404

California...

$3, 800
1,200
1,600

$37, 654
38, 787
55, 531

12, 264

13, 050
3,308

63, 837
9,388
46, 054

111 491

57, 779

Delaware.- ..

1,662

8,852

500

13 926

Florida

31, 660
2,529

53 562

1,800

Idaho

Illinois .

2,000
1,500
1,700

68, 157
36, 393
13, 996
5,891
1,704
15, 751

70 157

Indiana

15, 841

2, 273

130

5,768

16, 918
5,947
16, 157

4! 010

70, 652

Kansas

22 178

Kentucky

1,700

18 858

Louisiana

19. 761

NATIONAL DEFENSE MIGRATION 5367

Table 5. — Monthly summary of disbursements for engineering defense training to
engineering schools through Apr. 30, 1941 — Continued

States

December

January

February

March

April

Total

Maine

$2, 524
12, 577
40, 488
6,502
14, 172

$15, 149
14, 862
35, 060
12.744
21, 133

$17, 673
72, 383
95 735

"$i, 200
2,000
1,800

$43, 744
18, 187
17, 303

Michigan

38, 349
35 305

Minnesota

Missis'^ippi

8, 5fil

8,561

1,900

24, 603

34. 352

Nebraslia

3,025

781

1.905

36, 789

7, 395

259, 767

4,227

2,751

131, 989

1,070

1,111,843

6.147

9,172
781

Nevada

New HaTTip'sbirp

2,322
4,318

i6,"8li"
30,523

3. 459
71,627

3,022

4.227

1,500

77, 692

New Mexico

7 395

New York

3,400
1,800

7,125
35,828
5,617
2,064
9,891

287 103

72. 378

Ohio

1,800

207, 480

13. 984

Oregon

3,600

74, 278
5,275

10, 790
883

14. 500
6, 968

23. 940
1,911

20, 737

174, 804
3.557
7.346

1 364 525

8,832
34,548

South Carolina

16, 412

2,728
31,329

1,850

3,645
31, 586
13, 456
10, 157

3,162

3,939
12, 569

Texas

2,100

52 966

Utah

Vermont

5 556

Virginia

12,851
8,296

65 178

2.000

West Virginia

58, 817

68 974

1,650
7,276

Pi^trict of rinlnmhia

20,074

27 350

Alaska

Hawaii

Puerto Rico

3,978

3.978

Philippines

Total

38, 400

504, 117

2, 099, 388

736, 844

3. 378, 749

Table 6. — Allotment of funds for engineering defense training throuah Apr. SO,

1941

[By States, institutions, and type of allotment]

Institution

Disburse-
ments

Encum-
brances

Total allot-
ment

Alabama:

Alabama Polytechnic Institute

$29,653

$58, 321
81,564

$87 974

State total

29,653

139,885

169 538

2,131

1,450

California:

55,441

24! 832
4,845
21. 404

40, 195

University of California

73,840
2,656
26,580

98 672

University of Southern California

47 984

111,491

143, 271

Colorado:

Colorado School of Mines

14. 535
5,000
27, 846
10, 398

14 535

14, 040
10, 100
3,419

University of Colorado

37 946

State total

57, 779

27, 559

85 338

60396 — 41— pt. 1€

6368

WASHINGTON HEARINGS

Table d.— Allot me nt of funds for engineering defense training through Apr. 30^
1941 — Continued

Institution

Disburse-
ments

Encum-
brances

Total allot-
ment

Connecticut:

University of Connecticut

$61. 166
42,019

$18,893
25, 283

$80 05*^

67, 302

State total

103, 185

44, 176

147 361

13, 926

4,607

18, 533

Florida" University of Florida

53, 562

99,135

152. 697

Georgia: Georgia School of Technology

8,137

8,679

16 816

niinois:

Bradley Polytechnic Institute

5,004
65, 153

1, 425

77, 432
3,640

6 429

142, .585
3,640

Northwestern University

70, 157

82, 497

152, 654

Indiana:

6. 929
48, 786
14, 937

6,929
202, 734
14, 937

Purdue University

153, 948

70, 652

153,948

224, 600

Iowa:

Iowa State College of Agriculture and Mechanics

S,220
15, 696

1,940
885

10, 160
16,581

State total

23, 916

2, 825

26.741

Kansas:

Kansas State College of Agriculture and Applied Science__

12,963
9, 215

41. 363
18,640

54. 326

State total

22. 178

60,003

82. 181

Kentucky.

University of Kentucky

3,452
15,400

5.000
1,186

8,452

State total.-.. ..-

1,858

6,186

25,044

Louisiana:

Louisiana Polytechnic Institute

1,658
4,394

12! 013

1,790

3,448

State total

19, 761

1,790

21 551

17, 673

1,205

18,878

Maryland:

25, 221
47,162

y, 873
15,932

35,094
63,094

University of Maryland '

72, 383

25,805

98,188

Massachusetts:

Harvard University .

3,625
51, 443
15, 725
21,830

2.462
650

3,625
81 835

Massachusetts Institute of Technology

30, 392
1,950
7.345

17, 675

Tufts College

Worcester Polytechnic Institute

Massachusetts State College

State total

95. 735

39, 687

135, 422

Michigan:

Lawrence Institute of Technology

6,763

6,763.

2,154
17,945
13, 523
31 261

Detroit Institute of Technology

2,154

University of Detroit

17,945
11, 723
24,628
1,395
2,402

Michigan State College of Agriculture and Arts

1,800
6,633
22, 794

University of Michigan

Wayne University

Michigan College of Mining and Technology

7*370

State total.

38, 349

64,856

103,205.

NATIONAL DEFENSE MIGRATION

6369

Table 6. — Allotment of funds for engineering defense training through Apr. 30,
1941 — Continued

Institution

Disburse-
ments

Encum-
brances

Total allot-
ment

$35. 305

$44,185

$79, 490

8, 561

11, 829

20, 390

Missouri:

7,887
52, 968

7,887
63,213

Washington University . . . - .

10, 245

60, 855

10, 245

71,100

Nebraska' University of Nebraska

9.172

9 172

781

4,227

5, 583

New Jersey:

58, 352

34, 644

4, 039

760

15, 750

92, 996
4, 039

24,388
37, 560

83. 310

120, 300

85, 193

205, 493

New Mexico:

New Mexico College of Agriculture and Mechanics

2,655
4,740

2,655

10, 785

University of New Mexico

6,045

7,395

6.045

13,440

New York:

37, 097
m. 119

6,555

38, 380

16, 605

Rensselaer Polytechnic Institute

30, 119

9, 258

Union College

38, 380

12,611
1,933
33, 772

17,625
1,500

21,012

31. 939
8,130

94, 746

19, 558
35 272

Columbia University

New York Universitv

41, 964

73, 903

Defense Training Institute

38, 893

133 639

287, 103

155, 036

442, 139

North Carolina:

Agricultural and Technical College of North Carolina

1,805
1,875

68, 098

1 805

Duke University

6,340
24, 495

8,215
93 1Q3

North Carolina State College

State total

72, 378

30.835

103, 213

North Dakota: University of North Dakota

11,827

8,980

20 807

Ohio:

3,935
48,040
33, 513
22, 269
32, 785
42, 961
2,410
6,875
14, 692

2,068
38, 975
2,073

6,003
87, 015
35, 580

Case School of Applied Science

Ohio Northern ITniversity

Ohio State University

14,388
4,818

47, 173

Antioch College

2,410

1,357
14, 670

207. 480

78, 349

285,829

Oklahoma:

3, 587
5, 835
4,562

16, 410
26, 979

19, 997
:32, 814
4 562

University of Tulsa

State total

13, 984

43, 389

57, 373

Oregon" Oregon State College

2,001

2,09ft

6370

WASHINGTON HEARINGS

Table 6. — Allotment of funds for engineering defense training through Apr. 30,
^947— Continued

Institution

Disburse-
ments

Encum-
brances

Total allot-
ment

Pennsylvania:

Drexel Institute of Technology

.$146,815
13, 876
21, 622
136, 409
;«, 914
21. 156
6,852
133, 052
3,462
595, 648
246, 718

$6, 750

$153 565

Lehigh University

6,650
85, 779
5,759

28 272

University of Pennsylvania

222 188

Villanova College

21 156

Bucknell University

6.852

5,550

Grove City College

3 462

1, 262, 661

1,8.58,309

University of Pittsburgh

246 718

State total

1, 364, 524

1, 373, 149

Rhode Island:

5, 275
3,557

8,145

Rhode Island State College .

3 557

8,832

8,145

South Carolina:

The Citadel

14, 760
4, 380
15, 408

3,859

18 619

Clemson Agricultural College

4 380

15, 408

State Agriculture and Mechanics College .

2,194

2 194

34. 548

6, 053

40,601

South Dakota: South Dakota State College of Agriculture

883

1, 555

2.438

Tennessee:

1,350

277
6,400

1,350

XTniversity of Tennessee..

6, 667
14,500

6 044

Vanderbilt University

20, 900

State total

21, 167

8,027

29 194

Texas:

Agricultural and Mechanical College of Texas

17, 182
1,5, 673
2,550
2,015
12, 639
2,907

87, 202
2,514
6,825

104 384

Souther Methodist University

18, 187
9, 375

Texas Technological College

2 015

45, 812

58, 451

2.907

State total

52, 966

142, 353

195, 319

Utah:

Utah State Agricultural College

1,850
23, 940

1 850

23, 940

State total

25, 790

25 790

Vermont:

Norwich University

3.992
1,564

3 992

X 564

State total

5,556

5 556

Virguiia-

Virginia Militarv Institute

2,107
31, 166
31, 905

3,824
384

5 931

31, 5.50

University of Virginia

31, 905

State total

65, 178

4,208

69, 386

Washington:

3,560
19,812

380

3, .560

University of Washington

734

20, 546

State total

23, 752

734

24, 486

West Virginia: University of West Virginia

68, 974

3,350

72, 324

Wisconsin:

Marquette University

3.162

3, 162

University of Wisconsin

4,257

State total

3,162

4,257

7,419

NATIONAL DEFENSE MIGRATION 637 X

Table 6. — Allotment of funds for engineering defense training through Apr. SO,
1941— Continued

Institution

Disburse-
ments

Encum-
brances

Total allot-
ment

$1, 650

$7, 630

$9. 280

District of Columbia:

4,010
22, 410
13, 379

4,010

George Wasliington University

ii 314
13, 036

36 724

Howard University

26, 415

District total

27, 350

39, 799

67 149

3,978

2,710

3, 378, 749

2, 989, 754

6, 368, 503

Federal Security Agency — National Youth Administration

NUMBER employed ON THE OUT-OF-SCHOOL WORK PROGRAM

On June 21, 1941, there were 354,936 youth employed on the National Youth
Administration out-of-school work program. Of these 91,882 were working on
construction projects, 127,437 were employed in local workshops, 30,377 in resident
work centers and 102,240 were doing such work as providing clerical assistance
to local governmental agencies, public health and hospital work, recreational
assistance to draft boards and military establishments, etc.

During the 11-month period ending May 31, 1941, an estimated total of nearly
280,000 youth left National Youth Administration projects for jobs in private
industry. Beginning at a rate of approximately 14,000 in July and August 1940,
1 he number leaving for jobs has steadily increased and has reached over 47,000
in May 1941.

Although there has been a considerable absorption of youth into private industry
and the armed forces during the past year, there still remains a large number of
\outh who have not been able to secure employment. On May 31, 1941, there
were 377,002 youth in the awaiting-assignment files of the National Youth Admin-
istration. These youth have been certified to the National Youth Administration
as meeting National Youth Administration eligibihty requirements of need and
jire available for immediate assignment.

During the course of the present fiscal year it is estimated that nearly 900,000
different youth will have been employed by the National Youth Administration.
Approximately 600,000 of these will have left National Youth Administration
projects, of whom more than half will have left because they secured jobs in private
industry. The remaining number of youth will be terminated for a wide variety
of reasons? — because they secure public employment, return to schools, lose their
<'ligibilit}% reach their 25th birthday and for other and unknown reasons.

LOCATION OF NATIONAL YOUTH ADMINISTRATION PROJECTS

National Youth Administration projects are located in practically every county
of the United States. The widespread character of the out-of-school work pro-
gram eiiables it to reach youth who cannot be reached by other programs for youth.
In December 1940, the program employed youth from 2,821 of the 3,071 counties.
In 21 States, youth from every county in the State were employed, and in only
1 2 States were there as many as 5 counties from which no youth were employed.

Because of the widespread character, an enumeration of project locations is
difficult and expensive. It is estimated that National Youth Administration
workers are employed at over 20,000 different locations, ranging from large
l)rojects employing 800 youth to locations in cosponsors' offices where only 2 or 3
youth may be employed. On clerical and professional assistance projects, for
example, youth may be working in 100 different locations in the same city or
county.

The National Youth Administration has developed and is operating 5,419 shops
and production units. These shops are located in every State, Puerto Rico,
Virgin Islands, Alaska, and the District of Columbia. The National Youth
Administration also has in operation 622 resident work centers and has under
construction 45 others. There are attached tables showing the geographic loca-
tion of these production units and resident centers.

6372

WASHINGTON HEARINGS

Table 1. — Number of production units on ivorkshop-pi oductioti projects
school work piogram, May 19/^1

-oul-of-

Number of production units

Typo of ijro.luction activity

Total

Resident
projects

Nonresi-
dent
projects

Total --- ---- - --

5,419

998

4', 421

Machine and metalworking

1,006

223

78a

407
308
209

76
73

58
16

331

Sheet metal

235

AVelding -

151

349

257

Radio

192

157

56
36

136

121

604

114

490

Automotive maiDtenance and repair

506
53
45

74
21
19

432

1,303
1,567

148
303

1.155

Sewine

1,264

302
1,265

25
278

277

Domestic

987

590

118

472

Drafting blueprinting etc

272
318

49
69

223

249

'able 2. — Number of youth terminated because they secured private employment-
Out-of-School Work Program, July 1940 through May 19/,1 _^

1940:

1941

Julv 14, 500

August 13,490

September 17,093

October 18,234

November 16,844

December 16,009

Jamiary 22,437

February 31,596

March.: 38,852

April 43,058

May 47,540

Total 279,653

Tables.

-Number of youth employed by type of project- — out-of-school ivork program,
May 1941

Number of youth employed

Type of project

Total

Non-
resident
projects

Resident
projects

Total

377, 782

340,264

37, 518

Construction

102, 085

91, 930

1 10, 155

13,580
9,733
47. 355
13. 534
6,349
1,379

Improvement of grounds around public buildings

. . _

Building construction, repair, remodeling

Conservation.

AVatcr and sanitation

151,665

129, 304

22,361

Distribution by detail tyi)e not available .

NATIONAL DEFENSE MIGRATION

6373

I'abIvE 3. — Niwiber of youth employed by type of project- — ottt-of-school work program,
May 1941 — Continued

Number of youth employed

Type of project

Total

Non-
resident
projects

Resident
projects

Machine and metal working

20,822

16, 636

4,186

10, 013

6,836

3,178

795

8,122

5,582

2,311

621

1,891

Sheet metal

1 254

Weldin? .

867

174

jVutomotive and mechanical

8,934

6,828

2 106

7,162

522

1,250

6,120
231
477

Farm implements and equipment

291

773

Radio and electrical

4,625

3,413

1 212

2.903
1,722

2.060
1,353

Electrical

369

36, 394
57, 004

33, 612
48, 010

2,782
8,994

23,886

20, 805

3,081

2,914
20, 972

2,535
18, 270

379

2,702

124,032

119,030

15,002

Clerical assistance

75, 166
708

15, 049
3,269
3,835
3,502

16, 102
1,399

Library service

Nursery school and other services

Distribution by detail type not available.

Table 4. — Number of counties of residence of National Youth Administration
workers, by States and by urbanization groups, December 1940

Number of counties by urbanization groups

State

Total

Under
2,500

2,500

to
4,999

6,000

to
9,999

10,000

to
24,999

25,000

to
49,999

50,000

to
99,999

Over
100,000

Total -

2,821

1,238

547

421

333

122

Alabama

67
14
75
51
54
8
3
1
63

159
44

100
53
98

103

103
42
15
24
12
74

33
5
31
12
30

14
3

27
6
8

9
4
9
10

8
1

8
-.

10
5
2

Arkansas

1
3

California

Connecticut

District of Columbia -. -

Florida

27
102
25
27

7
29
54
64
15

14
28
12
19
6
36
19

12
4

8
14

5
22
14
13

8
3
2

1
17

.5
,?
\l

15
5
3
2
3
2

Idaho - .

lUinois

1
3

1
1

Kansas

Maine

Michigan

ii"

6374

WASHINGTON HEARINGS

Table 4. — Number of counties of residence of National Youth Administration
workers, by States and by urbanization groups, December 1940 — Continued

Number of counties by urbanization groups

State

Total

Under
2,500

2,500

to
4,000

5,000

9,999

10,000

to
24,999

25,000

to
49,999

50,000

to
99,999

Over
10000

Minnesota

86
82
109
54
76
15
10
21
21
7

55
99
53
79
63
32

46
66
94

197
29
14

100
39
52
67
22

46
59
38
45
11
1

21
20
22

4
14

14
4

16
6
9

1
5
4

11
13

6
16
15

9
14

9
10
7
4
6

6
5
2

16
14
3
20
10
4
17
3
5
5
2

1
3

9
5

Mississippi

2
2

Montana

Nebraska

Nevada -

New Hampshire

1
2

1
1

New Mexico

New York (excluding New York

City)

18
8
6

8
20

2
11
16

8
2

1
9
2
1

1
2

4
5

North Carolina

Ohio

2
--

Pennsylvaia

South Carolina

15
51
53
83
17
5
68
14
24
21
15

12
7

47
6
1

11
9
8

14
2

10
2
14
36
3
5
8
2
10
13
3

South Dakota

Texas

Utah -

Virginia

3
2

1
_.

Wisconsin

Table -5. — Number of certified youth awaiting assigujnent-
progratn, May 1941

-out-of-school ivork

State or Territory

Grand total

Alabama

Arizona

Arkansas... -.

California

Colorado

Connecticut

Delaware

District of Columbia

Florida

Georgia

Idaho

Illinois

Indiana

Iowa

Kansas...

Kentucky

Louisiana

Maine

Maryland _ .

Massachusetts.

Michigan

Minnesota

Mississippi

Missouri

Montana

Nebraska

Nevada

Number awaiting as-
signment May 31, 1941

Total Male Female

176, 713

5,471
111
12. 428
1.838
3,421

4,142
8,274

320
3,206
2,035
2,742
2,811
10, 393
1,597

920
16

325
1,990
2,496
7,896
3,495

645

10. 690
164

146

5, 405

9,164

485

3,365

3,709

2,809

1,534

6,510

3,083

617

4,502

1,468

2,516

6,254

5,738

679

978

State or Territory

New Hampshire

New Jersey

New Mexico

New York City and

Long Island

New York (excluding
New York City and

Long Island)

North Carolina

North Dakota

Ohio _.

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Texas.

Utah

Vermont

Virginia

Washington...
West Virginia..

Wisconsin

Wyoming

Alaska

Puerto Rico...
Virgin Islands.

Number awaiting as-
signment May 31, 1941

Total Male Female

2,039
13, 705
2,806

lli771

907

23, 016

11, 184

1,774

15, 052

38, 864

2,514

378

11, 438

654

11,350

4,394

274

263
5,234
1,817
4,854
6,076

4,479
835

6,834
21, 271

1,502
124

4,990
271

l!966

115

18, 799

1,776

8,471

6,041
5,695

14,067
"6,705

8,218

17, 593

1.012

254

6.448

383

3,461

2,428

159

19,298

111

NATIONAL DEFENSE MIGRATION 6375

Table 6. — Report of the number of resident centers in operation and under construe'
Hon — out-of-school work program, May 31, 1941

Number of resident
centers

State or Territory

Number of resident
centers

state or Territory

Total

In op-
eration

Under
con-
struc-
tion

Total

In op-
eration

Under
con-
struc-
tion

Total

667

622

16
8

46
6

16
1

85
8

64
2
1

16
2
6

18
1
2
2

16
17
16

8
45

6
12

1
83

8
19
61

1
16

6
16

Alabama

38
4
12
13
11
2
8
23
4
21
8
4
32
14
33
5
2
2
14
7
18
6
3
12
7

34
4
10
12
10

4
21
8
3
31
12
32
4
1
2
9
7

16
5
3
12

' 2

1
1

1
2

1
1

New York City and

Arkansas

New York (excluding
New York City)

Connecticut

North Dakota

Florida

Ohio

Idaho

Oregon

Pennsylvania

Rhode Island

Indiana

South Carolina

Knnsjis

South Dakota

Kentucky

Tennessee

Texas

Utah

Vermont

Maryland

Michigan

Washington

Minnesota

West Virginia

Mississippi

Missouri

Wyoming

Nebraska

Virgin Islands

New Hampshire

Table 7.-

■Youth employment by type of project and State
program, week ending June 21, 1941

-Out-of-school work

Total

Resident
projects

Local

state

Nonresi-
dent pro-
duction
projects

Construc-
tion proj-
ects

Professional

and

clerical

projects

Grand total

354, 936

33, 377

127, 437

91.882

102 240

11,275
1,569
4,408

10, 980
3,289
2,736
789
1,584
5,060
6,752
1,131

22, 773
9,790
5,926
6,043
6,217
9,847
2,752
4,655

10, 504

10, 543
7,931
8,072

14, 765

1,456

3, 945

358

642

11,644
1.254

1,810
99
431
1,174
317
78

2,636

389
1,422
3,411
1,377
1,489

136

261
1,626
1,914

151
10. 853
4,962
3,683

830
2,574
4,937

670
2,061
5,444
3,799
3,070
1,380
5,459

389

1,613

304
4,802

638

3,234

397

2,036

1,031

591

148

190

1,352

1,384

308

3.826

2,526

,1,212

2,625

1,847

1,312

427

990

638

. 1, 759

3,037

2,779

5,313

432

962

1,555

258

3,595

684

619

California

5.364

1.004

1.098
605

Delaware

1,133

Florida

561
2,316

466
1,461

599

210
1,519

858
1,529

860
13

129

385

1,551
239
137
475

Georgia

1,138

206

Illinois

6,633

Indiana

1 703

821

Kansas

1, 060

Kentucky

938

2, 069

Maine

795

Maryland

1 591

4.293

Michigan

4,600

Minnesota

1 436

2,362

Montana

498

Nebraska

896

235

New Hampshire

105
351
10

150

4,936

New Mexico- -.-

348

6376

AVASHINGTON HEARINGS

Table 7.— Youth employment by type of project and State — Oat-of-school work
program, week ending June 21, 1941 — Continued

New York City and Long Island

New York (Excl. N. Y. C.)

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina

South Dakota

Tennessee-.-

Texas

Utah

Vermont

Virginia

Washington

West Virginia.-

Wisconsin

Wyoming

Alaska •..

Puerto Rico

Virgin Islands.

Resident
projects

887

908

335

1,224

1,830

331

994

2,117

427

1,081

2, 552

145

675

167

820

432

Nonresi-
dent pro-
duction
projects

7.570

5,676

4,762

428

8,070

2,021

988

7,117

1.050

501

170

2,770

5,267

140

360

1,923

1,954

1,236

1,855

423

699

109

Construc-
tion proj-
ects

1, 192

884

2,116

10, 614
1.525

7,;

620
1,057
4,831
6. 537

280
28
2, 306
1.060
3, 155
1,056

138

Professional

and

clerical

projects

6, 712
1,136
1,439
6,633

387
1,463

400
2,855
3, 004

180

234

606
,262

294

104
,149

104

Apprenticeship Training

The training of apprentices within industry is handled by the Apprenticeship
Unit in the Division of Labor Standards of the United States Department of
Labor. The program of the Apprenticeship Unit and Training Within Industry
are closely coordinated. The Director of Training Within Industry is a member
of the Federal Committee on Apprenticeship; the Federal Chief of Apprenticeshij)
is a member of the Washington training within industry staff; and field representa-
tives of the Apprenticeship Unit are members of district training within industry
panels.

I. functions op the unit

The Apprenticeship Unit operates under specific congressional enactment
authorizing the ])romotion of labor standards of apprenticeship through coopera-
tion between management and labor. It has been clearly recognized by Congress
that this function is entirelj' distinct from that performed by the vocational
division of the Office of Education, in that it promotes the training of skilled
craftsmen not in the school but in the factory, the shop, and the plant.

During the past year or so the work of the unit has been concentrated almost
exclusively on promotion in defense industries, located principally in the major
industrial areas of the United States. Because the primary objective of the unit
is to persuade employers and labor to provide the actual training of apprentices, as
a result of which the cost to the Federal Government has been negligible, Congress
has willingly supplemented the unit's small appropriation to permit the employ-
ment of a larger apprenticeship field staff. Two years ago the unit employed only
15 field representatives; a year later, only 16; and today, 113. By the end of
August 1941 the unit will have in the field 175 trained representatives to encourage,
assist, and advise defense industries in developing their in-plant training pro-
grams.

The field staff attempts to secure the adoption of proper labor .standards of
apprenticeship in one of two ways. Where adequate organization of emploj'ers
and employees exists, a committee is formed con.sisting of three representative.s
from the appropriate employers' association and three representatives from the
approjjriate labor union. Where the employers are not organized in a trade asso-
ciation, separate apprenticeship committees, representing the employer and the
labor organization, are established for each plant. If no bargaining agent exists
for the employees, the employer is asked to register his apprenticeship standards
with, and .secure approval for his standards from, a State, or wliere this is lacking
a Federal apprenticeship committee; all State and Federal apprenticeship com-
mittees are composed equally of representatives of labor and employers.

NATIONAL DEFENSE MIGRATION

6377

II. GROWTH OF THE APPRENTICESHIP PROGRAM

The rapid expansion of the work of the unit is reflected in the following com-
parisons:

(a) Two years ago the entire unit made only 800 contacts per month, educating
representatives of management and labor in desirable apprenticeship standards,
advising them on improved methods of in-plant training, and stimulating them
to further effort in the preparation of skilled workers. One year later the unit
made 900 contacts. Today the unit contacts almost 8,000— roughly, 10 times
as many. And every contact results in some improvement in attitude. After
10 years of apathy and neglect, the training of skilled workers in this country
is receiving the attention it so vitally needs.

(6) Two years ago the unit could record only 300 apprenticeship systems in
the United States under standards approved by the Federal Committee on Ap-
prenticeship; 1 year later it recorded 550; today the records show more than a
threefold increase, more than 1,000 such systems under approved standards.

(c) Two years ago only 11 private plants had adopted training standards
recommended by the Federal Committee on Apprenticeship; 1 year later the
total had risen to only 22; today 236 are so registered, and almost all of them are
in defense industries. Private industry, in other words, is rapidly becoming
converted to the belief that only the best form of training will suffice, and that
the Apprenticeship Unit, as an impartial Government agency, can and does offer
the soundest suggestions in this connection.

(d) Against a present total of 125,000 apprentices employed in the United
States, it is estimated that we should be training at least five times as many.
During the past 6 months the total employed has increased about 25 percent.
Only a small fraction of these, however — ^probably about 50,000 — are under
adequate training programs. The need for continued aggressive education of
the public is urgent. Even with its present field staff, the Apprenticeship Unit
can adequately cover only a minor part of the total territory and bring about
improved training conditions.

(e) Two years ago only 15 States had apprenticeship agencies, 11 of which
operated under State laws; 1 year later the respective figures were 21 and 12;
today 24 States have such agencies, 15 of which are under State laws. In other
words, the people of the various States are becoming increasingly aware of the
need for organized programs of training for skilled workers.

(/) Almost every labor organization in the countrj^ has endorsed the standards
recommended by the Federal Committee on Apprenticeship, and employers are
increasingly asking for assistance of the field stafl" in improving their training
programs. This assistance has, of course, been carried out in close cooperation
with the Training Within Industry Section.

Estimated number of apprentices affected '^ by program of Federal Committee on
Apprenticeship, by States, March 1941

Total, United States 51.200 Nevada 100

New Hampshire 100

New Jersey 100

New Mexico 100

New York 11,000

Alabama 400

Arkansas 200

California 4, 200

Colorado 400

Connecticut 1, 100

Delaware.

District of Columbia-
Florida

300
100
800
Illinois 2, 600

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts.

Michigan

Minnesota

100

400

500

400

700

200

700

3,600

1,000

Missouri 2, 000

North Carolina 100

Ohio 2,000

Oklahoma 100

Oregon 900

Pennsylvania 2, 000

Rhode" Island 300

Tennessee 1, 100

Texas 2,000

Utah

Vermont

West Virginia.
Virgini

100

600

Washington 1, 200

Wisconsin 3, 200

Hawaii 400

U. S. Navy 4, 000

U. S. Army 800

Tennessee Valley Authority 200

Mississippi 200

' "Affected" here means that labor standards of apprenticeship have been improved in one or more
respects, although the apprentice is not necessarily operating under all standards of the Federal Committee
on Apprenticeship.

(5378 WASHINGTON HEARINGS

TESTIMONY OF SIDNEY HILLMAN— Resumed

Mr. HiLLMAN. It is well known that tlie exact types of skill required
in defense industries must be mainly trained within the plants and on
the job. Last autumn I established within the Labor Division a sepa-
rate section to visit the defense contractors — show them the need to
inaug-urate training programs within their plants as a regular part of
their operation. In recent months the progress of training within
industrj^ has been very rapid. Our most recent report reveals that
937 major deftmse contractors, with an aggregate of over 1,500,000
employees, have put in training-within-industrj^ systems and are thus
protecting themselves against future skill shortages. These plants
are also in a better position than others to increase the number of
shifts. Each shift requires a quota of trained workers and supervisory
personnel, which the in-plant training provides. I herewith submit a
detailed report on training within industry, called Exhibit D, showing
its general results and also its results by districts.

The Chairman. Your exhibit will be received.

(The document referred to follows:)

July 7, 1941.
Exhibit D. — Training Within Industry

i. functions

The Training Within Industry Section of the Labor Division of the Office of
Production Management was established in September 1940, to assist defense
industries in meeting their manpower needs b>' training within industry each
worker to make the fullest use of his best skill up to the maximum of his individual
abilities. This is accomplished through upgrading of all classes of personnel as
their experience and abilities warrant, through planned job progression, job
rotation, and intensive supplementary instruction both on and off the job.

The conclusions of various recent conferences confirm experience that this
training includes three phases:

(o) Development of production specialists through intensive instruction on
the job according to basic operations.

(b) Development of all-round skilled mechanics through trades apprentice-

ship, in accordance with Federal standards, separate from production-
worker training, for the purpose of developing a predetermined,
limited number of all-round journeymen mechanics.

supervisory duties of increasing responsibility, and provision for related
organized help through discussions and conferences under both plant
and outside auspices. Technical and other management assistants
must be developed also.

This organization renders specific advisory assistance to defense industries in
inaugurating programs which they carry on within their own plants at their own
expense. The availability of this service is widely known but is not compulsory.
There is no authority to go into a plant on any basis other than at management's
request.

Four general types of assistance apply in most cases and are being adapted to
fit the various conditions in each specific plant.

1. Help in the analysis of the training needs.

2. Aid in setting up a program within the plant to meet its needs.

3. Experience of other employers who have met similar problems is made

available through headquarters and field clearance.

4. Availability of the services of tax-supported Government agencies, sucli

as the State and Federal employment services, vocational and trade
schools, engineering colleges, National Youth Administration, Civilian
Conservation Corps, Work Projects Administration, made known to
plant managements so that the fullest use may l)e made of them. Only
through interpreting the needs of industry to these agencies, and their

NATIONAL DEFENSE MIGRATION 6379

closest coordination, can they furnish the most effective preemplnyment
education and preemployment experience as well as related instruction
for employed workers.

II. ORGANIZATIDX

Field service is most effectively rendered by representatives of training
within industry, working continuously in local areas of the district in which de-
fense industries are located. This field service is carried on under the general
direction of a small staff at Washington headquarters.

The headquarters staff consists of the Director, Associate Director, and
specialists experienced in dealing with training problems of industry. The
staff is guided by an advisory committee composed of six representatives of
labor and six of management. In addition, outstanding persons now actively
engaged in successful Training Within Industry programs serve as consultants
on a headquarters panel to assist in training methods dealing specifically with
certain major industries vital to the defense program. The members of the
National Advisory Committee, and the consultants on the headquarters panel
are available to the field service as speakers or as advisers regarding special
problems when the situations warrant such action and if requested through the
Director.

The field organization is set up in 22 districts as follows, according to the most
importaTit industrial centers:

1. Northern New England. 12. Northern Ohio.

2. South New England (Connecticut 13. Michigan.

and Rhode Island). 14. Indiana.

3. Up-State New York. 1.5. Greater Chicago and Illinois.

4. Greater New York City. 16. North Central States.

5. New Jersey. 17. Missouri, Arkansas, Oklahoma, and

6. Eastern Pennsylvania and Dela- Kansas.

ware. 18. Texas and Louisiana.

7. Maryland. 19. Colorado and Wyoming.

8. Virginia, North and South Carolina. 20. Southern California, Arizona, New

9. South Eastern States. Mexico.

10. Ohio Valley. 21. Northern California, Nevada, and

1 1 . Western Pennsylvania and Northern Utah.

West Virginia. 22. Pacific Northwest.

In each district the organization is as follows:

1. One district representative borrowed from industry because of his ex-

perience and standing in this field of work and, if needed, one field
assistant and one office assistant.

2. Four advisers, two from labor and two from management, selected on

account of their background and working experience in dealing with
such problems within manufacturing industries. They assist the dis-
trict representative in establishing helpful relationships in their areas,
and also assist in creating and maintaining public interest in training
problems. More than 80 labor leaders and management leaders are
now acting in this capacity.

3. A panel of 10 or more personnel and training consultants borrowed from

industry on account of their knowledge and experience, ^who are avail-
able on call as needed. Some 400 men are now members of these panels.

111. ACCEPTANCE OP TRAINING-WITHIN-INDUSTRY PROGRAM TO DATE

Acceptance of Training Within Industry programs has been excellent by
those companies where there is immediate need for training.

In a few areas of the country, however, there has been excellent acceptance of
the program in principle but little use made of it because of the lack of defense
contracts. This is particularly true in the Midwest; that is, the St. Louis, Daven-
port, Chicago, Milwaukee, Minneapolis, and St. Paul areas; and in the Southeast;
namely, the Atlanta, Knoxville, Birmingham, Richmond, and Chattanooga areas.

There has been a decided increase in demand for Training Within Industry
service, based on a growing realization by management and labor of future manu-
facturing requirements. Practically every district reports increased demand for
Training Within Industry counsel.

6380

WASHINGTON HEARINGS

IV. SPECIFIC RESULTS TO DATE

Patterns for iu-plant training, including specialized workers, all-round me-
chanics (apprenticeship) and supervision, which are satisfactory to industry, have
been developed largely through conferences with personnel and production manag-
ers. These patterns have been briefly described in 12 bulletins and 3 case studies,
all of which are being distributed throughout defense industries. Several additional
bulletins and case studies are in progress.

Some 17,000 sets of bulletins have been requested and distributed.

Several hundred articles in trade and professional papers have been published
based upon the bulletins.

Several hundred meetings and conferences have been called in all sections of
the country on training, most of which have grown out of the stimulus afforded
by the bulletins plus personal visits, addresses, and meetings.
; Training programs have been stimulated or effected through adviser, panel,
and other contacts with some 937 companies aggregating over 1,500,000 employees.'
(Figures from 17 out of the 22 Training Within Industry districts.)
V Field men have explained to employers how to make full use of Government
services, such as Employment Service, vocational schools. National Youth Ad-
ministration, Work Projects Administration and Civilian Conservation Corps.

They have also aided in subcontracting- and in locating unused manufacturing
facilities, in endeavoring to get employers to make greater use of Negroes, newly;
jiaturalized citizens, and physically handicapped, and in promoting jmore exten-
sive employment of women in defense industries.

V. PROGRESS OF TRAINING AVITHIN INDUSTRY AS OF JUNE 15, 1941

Summary by districts '

District and location

1. Upper New England

. Lower New England

3. Upper New York State

4. Greater New York City

■5. New Jersey

0. Eastern Pennsylvania and
Delaware.

7. Maryland -.

8. Virginia, North and South

Carolina.

9. Georgia, Alabama, Florida,

Mississippi, and eastern

10. Southern Ohio, Kentucky, and
southern West Virginia.

Number
of firms
benefited
by train-
ing with-
in indus-
try

Number of
employees
affected ''

70,000

22,500

(5)

74, 435

232,000

General action and comments ' .^

Distributed about 500 bulletins to interested
executives in 4 States. Only few requests for
service, but need increasing. Many Con-
tractors approve training-withinindustry
program. Personal contacts rapidly getting
under way.

Action primarily in Connecticut; 50 other
firms now interested. Expect to complete
Connecticut and Rhode Island surveys by
Aug. 31. General acceptance of need for
training within industry.

Reaction from industry to program very favor-
able. Demand for service growing as addi-
tional contracts are placed.

Excellent cooperation from industry. Expect
to contact 572 defense firms within next 3
months.

Keener realization of necessity for training after
6 weeks of contacts.

District office just being established.

Distributed 404 bulletins to firms requesting
personal contacts. Contractors now asking

E.xcellent cooperation from industry and Gov-
ernment agencies. Splendid training pro-
grrams. Need for training-within^irdustry
service growing.

Increased demand for training-within-industry
service already in evidence, with contractors
represented on panel, plus advisers and firms
contacted, represent 45 to 50 jiercent of Cin-
cinnati defense manufacturers.

Industry just beginning to appreciate training-
within-industry program.

11. Western Pennsylvania and
northern West Virginia.

1 The following figures are based on telegraphic reports dated .June 15, 16, 17, and 18, from 17 of the 22
training-within-industry districts. Many companies have had complete training-within-industry service,
while others have been counselled and aided generally.

2 Approximate only. "Affected" here means affected by any training activities undertaken as a result
of the training-within-industry program.

3 The following comments are based on telegraphic reports dated June 15, 16, 17, and 18, from 18 of the 22
district representatives of training within industry.

* District office not established yet.
' No figures yet.

NATIONAL DEP^EN«E xMlGRATION

Stanmary by districts — Continued

6381

District and location

Number
of firms
benefited
by train-
ing with-
in indus-
try

Number of
employees
affected

General action and comments

12. Northern Ohio except Lucas

County.

13. Michigan, and Lucas County,

Ohio.

14. Indiana

15. Illinois; Lake Porter, La Porte

Counties. Ind.

16. Northern Central States, Min-

nesota, Iowa, Wisconsin,
Nebraska, North and South
Dakota.

17. Missouri, Arkansas, Okla-

homa, and Kansas.
18 Texas and Louisiana

48
159
86

(■)

16
124

42
150

75, 000

400,416

(°)
64.000

(•)

68,200

C)
21,800

110,000
20,000

30, 300

Companies served seem uniformly apprecia-
tive, as most aid has been on acute problems.
No limit to service possibUities.

Management and labor enthusiastic about
training-wit hin-industry program.

Apathy of business still present. Additional
contracts will create greater demand for
training-within-industry services. Industry
cooperative, but little voluntary request for
service. Much interest in training bulletins.

Lack of defense contracts. Training-within-
industry program formerly met with apathy
in Duluth and Minneapolis. Interest in
training-within-industry growing.

Demand for in-plant and supervisory training
on Increase.

19. Colorado and Wyoming

20. Southern California, Arizona,

and New Mexico.

21. Northern California, Nevada,

and Utah.

22. Washington, Oregon, Mon-

tana, and Idaho.

Working closely with all industrial associa-
tions, causing broad coverage and effect of
training-within-industry program. Good
cooperation.

Reaction to training-within-industry by in-
industry highly receptive.

General reaction of industry negative, except
in shipbuilding industry, which accounts for
nearly 90 percent of this area's primary de-
fense manufacturing.

Reaction on part of industry very favorable to
training-within-industry program.

Total -

939

1.566,000

' No report submitted.

' No figures; three-fourths of area's defense contractors addressed June 12.

VI. ANTICIPATED LABOR REQUIREMENTS

(Based on figures covering 16 out of the 22 districts)

In general, defense contractors are not especially concerned about potential
labor shortages.

Training-within-industry programs are being rapidly developed in many dis-
tricts where, but a few weeks ago, contractors were expressing little if any interest
in training.

Several districts, however, are still doing only a small amount of training, due
to lack of defense contracts and insistence that labor shortages are not and will
not be acute. This is particularly true in upper New England, the Chicago dis-
trict, and the Minneapolis district.

The majority of district representatives maintain that in-plant training will
adequately take care of future labor requirements, providing continued cooperation
is obtained from labor and the various Government training agencies.

TESTIMONY OF SIDNEY HILIMAN— Resumed

Mr. HiLLMAN. The Detroit-Toledo area leads, with more than
400,000 workers under this type of training. I only wish that time
permitted me to dwell upon this remarkable accompHshment in some
detail. I must refer you, however, to the report itself.

EMPLOYMENT OF NEGROE.S

All such training heli^s to reduce the migration of workers by en-
couraging the employment of locally resident labor. But one thing
more is necessary if local labor is to be utilized to the full, and that is

5382 WASHINGTON HEARINGS

that there shall be no prejudices operating against the local worker..
I refer to prejudices because of race, color, creed, sex, and national
origin of parents, all of which have played some part in restricting thfr
employment of local labor and hence in creating migrations. The
Labor Division has a section working to overcome the consequences
of prejudice which operate against Negro workers, and another section
dealing with the prejudices against other minority groups. Both are
making progress. You are undoubtedly acquainted with the public
statements in this connection issued by the President, as well as his
Executive order which prohibits discrimination. Obviously, discrim-
ination of this type is calculated to limit defense production and further
imdermine national morale and the true interests of democracy in this
emergency. As long as a man or woman can do the required work,
he or she should be employed on equal terms.

I herewith submit a report, called Exhibit E, on the work of the
Negro Employment and Training Branch, indicating what is being
accomplished in this regard.

The Chairman. Your exhibit will be received.

(The document referred to follows:)

Exhibit E. — Nkgro Employment and Training

report by dr. robert c. weaver, chief, negro employment and training
branch, labor division, office of production management

Field investigations by members of the staff in the Negro Employment and
Training Branch of the Office of Production Management indicate that arbitrary
employment barriers erected against Negroes and other minority groups in certain
defense industries have increased the unnecessary migration of workers into some
defense areas. This widespread exclusion of minority groups from participation
in defense production has multiplied civic and social problems in various com-
munities by placing additional burdens on the housing, school, police, and fire-
prevention facilities of these municipalities. At the same time, these practices
have tended to retard the progress of our defense effort by making impossible
the total utilization of our human resources.

A few typical incidents will illustrate this situation. In Hartford, Conn., for
instance, where an increasing shortage of skilled workers was evident this year,
holders of defense contracts not only refused to employ competent and available
Negro workers but also barred Negro youths from defense-training programs after
the available supply of white youths had been exhausted. While maintaining
this ban against Negro workers — thereby increasing the percentage of Negroes
on the relief rolls — these employers advertised throughout the country for white
workers to come into the Hartford area.^

This situation was duplicated in Los Angeles, where large-scale defense produc-
tion is under way. Outside workers were imported into this area by the thousands
while qualified and available Negro workers were denied the opportunity to lend
their skills and aptitudes to the defense efi'ort.

During the construction of a camp near Petersburg, Va., hundreds of available
Virginia Negro carpenters were barred from employment on this project while
thousands of white carpenters from all parts of the country were imported to the
site for employment.

Similar practices may result in a heavy influx of outside labor to the Baltimore
area this year. A recent surve}' conducted in that city revealed that approxi-
mately 40 percent of the male-labor reserve of Baltimore is composed of Negroes.
Assuming that only one-third to one-half of the Negro labor reserve under 45
years of age could qualify for training courses, from 3,000 to 4,500 additional
trainees would be made available for defense industries in that area. Conversely,,
the failure of defense contractors to utilize this potential labor reserve will raise
the number of in-migrants to Baltimore from 3,000 to 4,500, with a resultant in-
crease of the housing, school, police, and fire-prevention needs of the community.

Many factors contribute to this widespread practice. One important factor is
the attitude of management — both top and supervisor}' — toward the situation.
Some presidents and directors of vital defense industries have refused to take

' See testimony of T. R. Downs, Hartford hearings, p. 53n-5319, especially pp. 5316 and 5318; and of
Martin F. Burke, Trenton hearings, p. 5603 ff.

NATIONAL DEFENSE MIGRATION g333

any cognizance of the problem. Others, in isolated instances, apparently have
permitted their own emotional bias to influence the employment practices of their
companies. Practices of this nature, however, are more prevalent among the
superintendents and foremen in defense plants. These men usually establish the
practices and draw up the specifications through which workers are hired, and
their lack of provision for the integration of qualified Negro workers has been
accepted without question by management and labor alike.

unions' attitude toward negroes

Another important factor in this picture is the attitude of organized labor toward
the integration of organized Negro labor into our defense efforts. Although only
a limited number of international unions bar Negroes by ritual or constitutional
bans, scores of small local unions establish barriers against the employment of
quahfied Negro workers.

A typical instance where such a practice affects the problem under considera-
tion occurred recently in Illinois. Hundreds of skilled Negro workers, many of
them holding union membership, were barred from construction work on a large
powder-plant project near Chicago seemingly because the business agent of
certain local unions in the nearby town refused to give clearance to these qualified
Negro workers. While we have been able to correct the situation in many trades,
these bans have been maintained in several crafts despite the crying need for
skilled workers in these categories. At the same time, the local unions involved
are calling skilled white workers from other jobs, some of them defense projects,
no doubt, in various parts of the country in an attempt to fill the labor needs on
this particular project.

ATTITUDE OF WHITE EMPLOYEES IN GENERAL

A third factor which may influence the picture is the general attitude of white
employees toward the introduction of Negro workers into industry. While this
factor undoubtedly does play a part in the formulation of exclusionist policies, it
is often exaggerated by employers in their refusal to hire Negro workers. One
large construction engineering firm, for instance, refused to use skilled Negro
building trades workers in the erection of a powder plant in the Middle West.
The construction manager for this firm defended this practice by saying that
"white and Negro artisans would not work together in this section of the country."
He refused to alter his position even when it was pointed out to him that subcon-
tractors on this very construction job were using hundreds of Negro and white
skilled workers and working them side by side. As a result of his arbitrary posi-
tion on this question, hundreds of additional Negro skilled workers in the area
were denied employment opportunities at the very time that the construction
manager frantically sought white workers from other sections of the country,

I do not believe that I can stress too much the economic waste, and the dangers
to our national unity, which result from such practices. There is no general form-
ula by which thousands of local situations may be solved. There is, however, in
almost every community and in most industries objective evidence that available
local labor resources are being ignored while frantic efforts are being made to lure
outside workers into defense communities. This is a problem which both manage-
ment and organized labor must face, and one for which both must seek a solirtion.
In view of the current emergency, it is a problem which deeply affects the entire^
American economy.

TESTIMONY OF SIDNEY HILLMAN— Resumed

Mr. HiLLMAN. Resident workers may be locally trained, however,
and employed, without removing one basic cause for the migration of
workers. This lies in inequalities of wages, hours, and working con-
ditions that exist in different localities and between dift'erent plants
in the same industry.

Dift'erent wage scales in shipyards within the same area, for example,
might be expected to create excessive labor turnover m that area. A
worker can hardly be blamed for quittmg his job in a substandard
plant and gomg to work in a plant in the same industry some distance
away, where, he understands, conditions are better. During the

60396 — 41— pt. 16 6

5384 WASHINGTON HEAIilNGS

World War it was notorious that certain shipyards indulged in com-
petitive bidding for one another's workers, with a resulting rise in
costs and disruption of employment conditions within the industry.

It w^as because of this that the Labor Division last November 27
launched its program of stabilization for the shipbuilding industry,
which today is virtually complete. The plan was to bring the
employing shipbuilding concerns into conference with the organiza-
tions of shipyard labor and with the Navy and Maritime Commission,
under the auspices of O. P. M.; and to w^ork out a general agreement
on basic zone standards, one agreement for each shipbuilding sector.
The Pacific-coast agreement was the first; it w^as reached on April 11.
The Atlantic-coast agreement has been consummated and also has
been signed by all parties; the Gulf agreement is scheduled to go into
effect August 1 ; and the Great Lakes agreement was concluded July
11 and its terms are now in process of final approval.

We are now in the first states of extending this stabilization system
to the aircraft industry. O. P. M. has similarly initiated a stabiliza-
tion program for the construction industry. A tentative agreement
has already been arrived at between the Federal agencies in charge
of construction and the building trades. By stabilizing conditions on
an industry-wide basis, migration is discouraged.

(The following memorandum giving the outlines of the agreement
mentioned above was later received from the witness and accepted
for the record as Exhibit E-1:)

Exhibit E-I. — Memorandum of Agreement Between the Represent.\tives
OF Government Agencies Engaged in Defense Construction and the
Building and Construction Trades Department of the American-
Federation of Labor

1. uniform overti.me rates

Where a single shift is worked, 8 hours of continuous employment, except for
lunch periods, shall constitute a day's work beginning on Monday and through
Friday each week. Where work is required in excess of 8 hours on any one day
or during the interval from 5 p. m. Friday to 7 a. m. Monday, or on holidays
such work shall be paid for at one and one-half times the basic rate of wages.

2. UNIFORM shifts

Where two or more shifts are worked, 5 days of 7,i'2-hour shifts from Sunday mid-
night to Friday midnight shall constitute a regular week's work. The pay for a
full shift period shall be a sum equivalent to eight times the basic hourly rate, and
for a period less than the full shift shall be the corresponding proportional amount
wliich the time worked bears to the time allocated to the full shift period. Any
time worked from Friday midnight to Sunday midnight, or in excess of regular
shift hours, shall be paid for at one and one-half times the basic rate of wages.
Wherever found to be practicable, shifts should be rotated.

3. NO stoppage of WORK

The Building and Construction Trades Department of the American Federation
of Labor agrees that there shall be no stoppage of work on account of jurisdictional
disputes, or for any other cau.se. All grievances and disputes shall be settled by
conciliation and arbitration.

4. SUBCONTRACTORS

It shall be the poHcy of all Federal contracting agencies to require the utiliza-
tion of specialty subcontractors on those parts of the work which, under normal
contracting practices, are performed by specialty subcontractors subject, however,
to the following:

NATIONAL DEFENSE MIGRATION 5385

(a) When a general contractor can demonstrate that specialty work has
been customarily performed by his own organization and that his existing
organization is competent to perform the work, he may be permitted to do so.

(6) Where the performance of specialty work by specialty subcontractors
will result in materially increased costs or inordinate delays, the requirement
hereinbefore mentioned may be waived.

On negotiated contracts the decision as to which parts of the work will be per-
formed by subcontract will, insofar as may be practicable, be made at the time
the contract is negotiated.

.5. PREDETERMINATION OF WAGES

In predetermining the minimum wage which is to be paid to contractor's em-
ployees on the specific construction job, consideration shall be given to the rates
preVailing in the area from which labor must be drawn to man the job and to new
wage rates which have been negotiated and concluded through bona fide collective-
Ijargaining processes which will take effect at a future date.

Wage rates paid at the start of work on a project shall continue until the com-
pletion of the project, or not more than 1 year, and new agreements or new deter-
minations of wages for work in the same area will become effective only on new
jobs started or new contracts signed after the employer-employee agreement has
been negotiated.

6. APPLICATION OF AGREEMENT

Any contract work done for, or through, any Federal agenc.v for defense pur-
l>oses within the continental limits of the United States and the Panama Canal
Zone shall be governed by this labor policy.

It is understood that the provisions of this agreement shall apply onh- to
national defense projects.

7. APPRENTICES

It is agreed that the number of apprentices used shall be limited to the number
agreed upon between the respective unions and contractors and ajjjjroved by the
Department of Labor in the case of those unions and employers' associations that
have established apprenticeship standards in conjunction with the Department
of Labor and the number of apprentices in other cases shall conform to the usual
j:)ractice prevailing between the unions and the employers' associations of the
respective trades.

8. BOARD OF REVIEW

There shall be constituted a board consisting of a representative of the Gov-
ernment agencies, a representative of the building and construction trades depart-
ment of the American Federation of Labor, and a representative of the Office of
Production Management. It shall be the function of this board to interpret the
provisions of this agreement, to adjust disputes arising hereunder, and the findings
of the board shall be binding on the parties to the agreement. In case of a dispute
involving a specific governmental agency, that agency may designate a repre-
sentative as a temporary member of the board for the mediation of that dispute.
The board shall have no authority to encroach upon or to relieve any governmental
agency of its legal authorities and/or responsibilities.

TESTIMONY OF SIDNEY HILIMAN— Resumed

COLLECTIVE BARGAINING AS CHECK ON MIGRATION

Mr. HiLLMAN. Collective bargaining itself has a stabilizing in-
fluence, and there is less migration in industries where collective
bargaining prevails than in those which are not organized or organized
only m part.

I herewith submit a report, marked "Exhibit F," on the work of
the Shipbuilding Stabilization Committee of the Labor Division,
showing its progress to date.

The Chairman. The document will be received.

5386 WASHINGTON HEARINGS

(The document referred to follows:)

Exhibit F. — History of the Shipbuilding Stabilization Committee — Its
Origin and Purposes

In the single year since the start of the present defense program in June 1940,
Congress has appropriated approximately $8,000,000,000 for the building of naval
and merchant ships. In only 1 month during the 4 years 1935-38 had aggregate
employment in the construction and repair of vessels reached 100,000 men. As
late as December 1939 it was only 132,000. Under the stimulus of the greatest
shipbuilding program ever undertaken in this countrj", the number of shipyard
employees was rapidly to increase, however, so that by February 1941 it was
251,000, while estimates of the Bureau of Labor Statistics forecast an employment
bv September 1942 of 725,000 — which would mean an increase in 3 years of
600,000, or more than 500 percent.

In the great Emergency Fleet program of the first World War the maximum
number of employees in steel shipyards — not attained until May 1919 — was
268,000. The earlier peak in wood and composite shipyards had been 80,000.
Construction and repair in navy j'ards and in private shipyards doing work not for
the Emergency Fleet Corporation would, of course, add somewhat to the total —
but still give a figure considerably smaller than that now in prospect. Experience
during the earlier emergency showed, however, how exceedingly grave were the
problems created even by this lesser expansion in shipyard activities. In the
summer and fall of 1917, with the United States already at war, a succession of
strikes occurred in shipyards surrounding New York, in yards at Wilmington,
Del., and Philadelphia, and at the ports of Seattle, Portland, and San Fran-
cisco. With 40,000 shipyard workers and 10,000 other metal trade workers out,
practically the entire shipbuilding program on the Pacific coast was tied up.
Lying back of these visible signs of disruption and unrest was a confused policy, or
early lack of policy, with regard to wage rates — competitive bidding, which led on
the one hand to a spiraling of wages and pyramiding of costs to the Government,
and on the other to futile movement of men from yard to yard and city to city.

purpose of the shipbuilding stabilization committee

It was to counteract, during the present emergency, tendencies in this direction
that on November 27, 1940, the Labor Division of what was then the National
Defense Advisory Commission, announced the appointment of a Shipbuilding
Stabilization Committee. By this time labor shortages were already occurring
in certain occupations. This was especially true of ship carpenters, loftsmen,
and shipfitters. There was also an inadequate supply of marine architects, shop
electricians, marine gas-engine machinists and template makers. The danger of
competitive wage bidding was increased by the extreme lack of uniformity in rates
and earnings as between shipyards. For example, the average yard hourly earn-
ings of skilled burners and welders varied along the Atlantic coast from $1,267
for the yard with the highest average to $0,621 for the yard with the lowest aver-
age. The ultimate purpose of setting up a committee was, of course, not so much
to establish uniform standards for their own sake as to remove causes of controversy
and friction, so that all efforts might eventually be directed to increasing produc-
tion. It was desired, moreover, not to have the job of recruiting and training
labor vastly complicated by unnecessary migration or the movement of men from
one yard to another and then back again, and to reduce to a minimum the'harmful
effects of migration on living conditions,

representation on stabilization committee

The Shipbuilding Stabilization Committee is composed of four representatives
of labor (two from the American Federation of Labor and two from the Congress
of Industrial Organizations), four representatives of the shipbuilding industry,
representatives of the United States Navy and United States Maritime Commis-
sion, and a chairman and executive secretary from the Labor Division of what is
now the Office of Production Management. The labor representatives on the
committee are John P. Frey. president of the metal trades department of the
American Federation of Labor, and Harvey Brown, president of the International
Association of Machinists, representing the American Federation of Labor; and
John Green and Philip Van Gelder, president and secretary, respectively, of the
Industrial Union of Marine and Shipbuilding Workers of America, representing
the Congress of Industrial Organizations. The industrial members on the Com-

NATIONAL DEFENSE MIGRATION 6387

mittee are H. Gerrish Smith, president of the National Council of American Ship-
builders, representing the Great Lakes shipyards; Gregory Harrison, representing
the Pacific shipyards; F. A. Lidell, representing the Gulf shipyards; and Prof.
H. L. Seward, representing the Atlantic yards. Rear Admiral Emory S. Land,
Chairman of the United States Maritime Commission (with Capt. J. O. Gawne,
U. S. Nav3', as his alternate) is the member for the Maritime Commission; while
Joseph W. Powell, Special Assistant to the Secretary of the Navy (with Capt.
C. W. Fisher, U. S. Navy, as his alternate), represents the Navy. Morris L.
Cooke, industrial engineering consultant to the Labor Division of the Office of
Production Management, is chairman of the Committee, and Thomas L. Norton
is executive secretary.

POLICY OF STABILIZA.TION COMMITTEE

At its initial meeting on December 5, 1940, the Committee adopted the following
statement of policy:

"The Shipbuilding Stabilization Committee at its first meeting adopts a policy
urging that there should be no interruption of production on the part of shipyard
employers and of shipyard employees before all facilities at the disposal of the
National Defense Advisorj'^ Commission for adjusting differences have been
exhausted."

As a result of deliberations extending over several meetings the Committee
concluded that labor conditions could best be stabilized through voluntary co-
operation on the part of all parties concerned, and that the basis for agreement
could best be worked out in a series of zone conferences at which the employers
and vmion representatives in each region, together with Government officials,
would arrive at zone standards. The zone standards, however, would cover only
the most basic matters, those points respecting which the Government, as the
final purchaser of the product and trustee for the whole defense program, had a
vital interest. Broad zone standards having been arrived at, it would then be
left to the employers and employees in each local area to themselves come to an
agreement covering many matters in greater detail— or with variations to fit the,
customs or ideas of the parties.

It was decided that zone standards should cover only the following points:

(a) Basic wage rate for standard skilled mechanics. The definition as to

who were to receive the standard rate and what differentials were to
be paid for other occupations was left for determination by the parties.
This would permit a maximum of conformity to local custom.

(b) Overtime.

(d) Bar against limitations on production.

(e) A no-strike and no-lockout clause.
(/) Provision for grievance machinery.

Ig) A 2-year duration clause, with provision, however, for wage adjustments
at the end of 1 year.

Though not a "must" item, the Committee sought to have the question of
training programs included in the standards for the industry.

COAST FIRST AREA. COVERED BY ZONE STANDARDS

The Pacific coast was chosen as the first area to be covered by zone standards.
The technique used at the conference was as follows:

Since the American Federation of Labor unions were in the majority in the
shipyards in that region, representatives of these unions developed the zone
standards with those employers with whom they had agreements. The Indus-
trial Union of Marine and Shipbuilding Workers of America (Congress of Indus-
trial Organizations) merely had observers at the conference, but this union agreed
in advance to conform to the standards as established. The United States
Navy, the United States Maritime Commission, the Office of Production Man-
agement, and the Shipbuilding Stabilization Committee were also represented
by official observers. Following the determination of zone standards for the
Pacific coast, it happened that the employers and union representatives for that
zone as a whole ertered into a "master agreement" which, while within the
limits set by the zone standards, went into greater detail, setting up for the
whole coast certain further standards within which local agreements were to
be worked out for the individual yards. The Government was not a party to
this "master agreement."

(J388 WASHINGTON HEARINGS

At the Atlantic coast conference, on the other hand, the Congress for Indus-
trial Organization union represented all labor. No master agreement has been
introduced on the Atlantic coast or in any of the other zones.

On both the Atlantic and Pacific coasts complete agreement has now been
reached oii zone standards — the only serious incident having been the refusal
of two machinists' locals in San Francisco to subscribe to the standards accepted
by their representatives, and a strike at San Francisco which followed. This
ended, however, in the signing of the agreement by all parties.

On the Gulf the work of the conference has been completed, and the standards
will doubtless have been approved l)y all concerned by August 1. On the Great
Lakes negotiations were concluded on July 11, and the conference adopted the
standards on tliat date.

It is the hope of the Shipbuilding Stabilization Committee that, a check having
been put on tlie development of competitive differentials, the gigantic task of
adding some 600,000 men to the shipbuilding industry can be carried through
with a minimum of migration, either geographically or in the way of drawing men
from other defense industries — particularly shipbuilding — and with a maximum
of opportunity left open for the locally unemployed or ineffectively employed.

At the request of the Shipbuilding Stabilization Committee, the Bureau of
Labor Statistics made a survey of the sources from which skilled men were drawn
for 5 Atlantic coast shipyards during the last 6 months of 1940. Of 1,580
skilled workers hired it was found that 1,015, or 64 pi-ecent, came from the State
in which the shipyard was located (or in the case of Camden, from New Jersey
or Pennsylvania). Their occupations, as of the date hired, has been as follows:

Percent

Shipbuilding 6.7

Machine tool and aircraft industries 3. 7

Other manufacturing industries 14. 6

Nonmanufacturing industries and Government employment 26. 9

Self-employed 9. 8

Works Projects Administration and unemployed (including persons just

out of school) 34. 1

Not reported 4. 2

Total 100.0

There were important variations between yards in some of the figures. Thus
the percentages of skilled employees recruited from Works Projects Administra-
tion or from among the unemploj-ed, taken yard by yard, ran 71.9, 27.4, 18.1,
16.5, and 6.9 percent, respectively.

TESTIMONY OF SIDNEY HIILM AN— Resumed

Mr. HiLLMAX. The temptation to the worker to leave home and
migrate is felt with special strength in those communities which have
no share in the work of defense production.

Last autumn the Labor Division became interested in the so-called
ghost towns and had a studj' made of them.

(The following study was received later from the office of Mr.
Hillman and accepted for the record as Exhibit F-1:)

Exhibit F-1. — History op the Efforts of the Labor Division to Revital-
ize Ghost Towns and to Stimulate Subcontracting

As soon as the national-defense program reached a stage where a substantial
volume of defense work had been contracted for it began to be evident that the
shift from normal peacetime activities to munitions production would raise
serious problems of industrial and population migration. In the accompanying
table the value of defense contracts awarded to concerns in the several States
through March 1941 is compared with the population of each State to obtain a
per capita value. Between the high of $305 per capita going to Connecticut and
no contracts at all going to North Dakota there is almost every degree of variation
in the volume of defense orders distributed.

Something of this sort was, of course, inevitable. The first airplane orders
had to go to a State with an airplane industry, orders for ships to localities having
shipyards, whih; few if any defense contracts could be expected to go to purely

NATIONAL DEFENSE MIGRATION

6389

agricultural areas. Also the impact of defense production has been spread much
more widel}- than these figures suggest because goods finished in one State gen-
erally require much material produced elsewhere.

When all allowance is made for these conditions the geographical distribution
of defense orders nevertheless raised and is continuing to raise serious problems.
On the one hand communities receiving large volumes of orders were confronted
with a problem of expansion. It became necessary to enlarge plants, to import
worliers, to build houses, to extend community facilities of all kinds. All this
meant a double burden and danger. The first effect was to cause congestion and
expense, and raise all the problems connected with boom towns. The second
menacing aspect of the situation was the overexpanded condition which vi,as
likely to reveal itself as soon as the peak of emergency production had been
passed. The timing and character of post-war adjustments is of course as yet
unknown. Certainly, however, we should not go any further than is necessary
in shifting our industries and population to centers where the need for them
may cease when the emergency passes.

Value of defense contracts in dollars per capita

Alabama 57.

Arizona

Arkansas

California- _

Colorado

C<jnnecticut.

3.2

2.5

186.0

109. 0

305.4

Delaware 81.6

District of Columbia 8. 3

Florida 24. 7

Georgia 25. 3

Idaho 2. 2

Illinois 32. 5

Indiana 97. 3

Iowa 26. 9

Kansas 28. 7

Kentucky 10. 5

Louisiana 14. 5

Maine 163. 8

Maryland 167. 0

Massachusetts 158. 9

Michigan 125. 9

Minnesota 14. 9

Mississippi 31. 1

Missouri 90. 2

Montana (')

' Less than .5 cents- per capitn.

Nebraska 4. 9

Nevada 25. 4

New Hampshire 23. 3

New Jersey 258. 9

New Mexico 17. 6

New York 72. 6

North Carolina 19. 1

North Dakota None

Ohio _--_ 58. 7

Oklalioma 2. 8

Oregon 34. 9

Peniisvlvania 71. 3

Rhode Island 70.1

South Carolina, - -_ 19. 5

South Dakota .2

Tennessee 25. 3

Texas

Utah

Vermont

Virginia

Washington. _
West Virginia^
Wisconsin. .
Wyoming

31. 7

18.0

7.8

201.5

249.7

57.4

34. 8

17. 1

PROBLEM OF AREAS WITH FEW DEFENSE ORDERS

The other and more serious half of the problem introduced by the uneven
distribution of defense work lay in the communities where defense orders were few
or nonexistent. At the start, this merely showed itself as a failure to share in the
quickening of industrial activity occurring in communities getting defense orders.
As soon, however, as shortage of labor de\'eloped in defense centers, this meant
that communities lacking orders began to lose their normal labor supply. Next
there has been a tendency to lift key equi])ment bodily from shops having no
defense business and transport it to other places, thus removing the very possi-
bility of carrying on productive work in the localities whose equipment has been
depleted. Finally, now that we are reaching a point where priorities are beginning
to cut off materials from some producers, and restrictions on consumption also
promise to curtail production in various peacetime industries, the predicament of
many companies and communities which have not shared much in the defense
program promises to be greatly aggravated.

The decline in industrial activity in some areas and its overstimulation in others
is of high concern to workers threatened with unemployment, to the shops in
which they normally work, and to the communities in which they live. The
immediate reason for desiring a better distribution of defense work is, however,
the expediting of defense production. The largest possible volume of defense
production is needed this year. The output from new equipment introduced into

5390 WASHINGTON HEARINGS

enlarged plants cannot be available in any appreciable volume until next year, if
then. Where it is possible to utilize existing but idle equipment precious time is
saved — in addition to avoiding the cost, additional drafts on labor and materials
and confusion inherent in building new capacity. Furthermore, even if we were
100 percent equii)ped to meet the needs of today, changes in the type of goods
wanted would soon throw some capacity into idleness, at the same time that there
would be serious delays in the bringing out of new products, unless ways could
be found to quickly convert much of the capacity already on hand but not in
use, so that it could again become active in the meeting of new needs.

TWO METHODS OF IMPROVEMENT

Though the difficulties which have here been mentioned cannot be overcome
entirely, there are two main methods by which we might hope to bring about an
improvement. The first method is to introduce such changes in the way in which
Government contracts are let, or effect such organizations and preparations in the
areas where activity is slack, that prime contracts themselves can be placed where
none are now held. The second method is to work out arrangements by which
firms having large Government orders can place many of the actual operations
with other concerns which could not undertake to produce all of the given product,
but could do some part — a procedure which is known as subcontracting or farming
out. Obviously there are real difficulties involved in the application of either of
these methods. Yet the records of munitions production in England, Germany,
France, and Spain indicate extensive farming-out programs in most of these
countries, and it has long been known that even before the American defense
program got well under way subcontracting had been carried on with marked
success by certain companies in this countrj'. Because of the great importance
of this issue both to labor and to national defense, it seemed to the Labor Division
that much more should be known on the one hand of the difficulties, and also the
possibilities, of placing work in the communities which have so far had little, and
on the other hand of the technique, and also the problems, involved in successful
farming out.

SURVEYS IN SLACK AREAS

Active exploration along the first of these lines was started in October 1940.
A group of engineers and economists was sent out to selected areas where the
decline of some industry had created a serious slack, and quick surveys were
made of the conditions found to exist and of the possibilities of putting unem-
ployed labor and equipment to work on defense production. In these early trips
som.e 8 or 10 cities, a number of which could well be termed "ghost towns," were
visited. These included Paducah, Ky.; coal-mining centers in southern Illinois,
Bloomington and Bedford, Ind., where the limestone industry had been depressed;
Cambridge, Ohio, and Harrisonburg, W. Va. ; and in Pennsylvania, New Castle,
Chambersburg, Franklin, Sharon and Farrel, and Beaver County. Later, con-
tacts were made with communities in almost all parts of the United States.

Exploration into the technique, the problems and possibilities of subcontract-
ing was started in November 1940.

The work of the Labor Division on "ghost towns" and "farming out" has been
primarily educational and promotional. The actual administration of subcon-
tracting aids, especially since the organization of the Defense Contract Service,
has been in the Production Division. The Labor Division has, however, consulted
with persons in many communities who were seeking light on how they might take
a part in the defense program; it has endeavored to stimulate interest among manu-
facturers, technical men, and in the Government departments: and it has issued the
following farming-out bulletins:

No. 1. Farming Out Practices at Home and Abroad.

No. 2. Available Capacity in Special Areas.

No. 3. List of Selected Defense Prime Contractors.

No. 4. The Problems and Organizations of Farming Out.

No. 5. Farming Out Methods.

SUBCONTRACTING HAS INCREASED

During the months which have passed since the Labor Division started work in
this field there has been a material increase in the volume of subcontracted work.
In many of the depressed areas visited there has been some improvement in condi-
tions, mainly because with the general quickening of national industrial activity,
including the growing volume of rail transportation, electric power generation,

NATIONAL DEFENSE MIGRATION 6391

etc., there has been a pick-up in many servicing and supplying industries. In
New Castle, Pa., the pressure on steefproductipn has compelled the reopening of
closed mills, and in other places there is at least an early prospect of some defense
business.

In general, however, it cannot be said that the problem of depressed areas or of
farming out has been solved. As a matter of fact, farming out cannot get very
far if pushed merely as an end in itself. At the root of the whole problem is the
need for an intensified planning of defense production. Only as procurement au-
thorities determine precisely what is needed, and break these needs down into the
component parts of machines as well as the whole product, and then bend every
effort to find where the necessary work can be done and done quickly can there
flow any real volume of work to those who are not in the direct line for prime con-
tracts.

Unfortunately this type of analysis, and the effort to mobilize for full use all
out capacity and labor power wherever it is, has been very slow in getting under
way.

TESTIMONY OF SIDNEY HILLMAN— Resumed

Mr. HiLLMAN. A general policy of subcontracting has been strongly-
advocated, but this, I understand, is to be the subject matter of testi-
mony by Mr. Mehornay of O. P. Al.'s Defense Contract Service.^

One further point remains. The effect of mandatory priority orders
in creating unemployment in plants which cannot get materials is at
present causing concern, and a special section of the Labor Division
has been established to deal with the whole problem of priorities in
their effect on labor displacement. As my final exhibit I submit a
report on this work.

I herewith submit Exhibit G for the record.

The Chaieman. It will be received.

(The document referred to follows:)

Exhibit G. — Work of Priorities Branch, Labor Division, Office of
Production Management

The imposition of priorities on scarce metals and materials is almost certain to
cause some displacement of business and labor. Priority action involves some
curtailment in the use of a metal or material in the manufacture of certain products
for civilian use.

For example, although the production of virgin aluminum has been increasing,
the use of such aluminum for the manufacture of articles like ice trays, automobile
parts, cooking utensils, foil, costume jewelry, and building materials has been
curtailed as the military requirements for virgin aluminum have expanded.

The consequence of directing more and more aluminum into airplane production
has been that employers with productive facilities formerly used to produce noi -
defense articles must either substitute some other material for aluminum if they
remain in nondefense production, or arrange to use their productive equipment on
defense orders for which aluminum is available, or find their operations curtailed
by the lack of available metal for nondefense production.

" In contrast to domestically produced metals and materials, whose output has
been increasing, is the situation in certain imported articles such as rubber, cork,
and tin, in which stock piles are being accumulated against the day when this coun-
try may be cut off from the overseas sources of supply for these materials used in
defense production. The accumulation of such a stock pile may involve a priority
program for reducing the amount of the commodity available to manufacturers.
In the case of rubber, for example, the manufacturers are receiving 15 to 20 percent
less crude rubber this month than they used in their operations in June, and they
will receive a progressively smaller amount each month of this year.

The Labor Division of Office of Production Management, is, of course, vitally
concerned about the problem of labor displacement resulting from priorities, not
only because of the unfortunate personal effects upon those workers who may
be rendered temporarily idle, but also because we are trying to make the most
effective possible use of the available labor supply in order to facilitate the
defense program.

1 Se€ p. 6409.

5392 washinctTon hearings

It has been the policy of the Labor Division of Office of Production Manager
ment to strive, insofar as possible, to keep existing working forces intact in the
plant and the community where they have been located in order to avoid the
waste involved in disrupting present staffs, building up and training new staffs
under different supervision, and shifting workers and their families from one
locality to another.

PROGRAM TO MINIMIZE EFFECTS OF PRIORITIES ON LABOR

In order to minimize the effects of priorities on labor and to aid in the transfer
of productive facilities from nondefense to defense work, the Labor Division has
pursued the following program:

1. We recommend that commodities be placed under mandatory priority before
shortages become acute so that sudden curtailments may be avoided and pro-
ducers can anticipate and prepare for future curtailments.

2. In priority orders and in the administration of priorities, we try to make
certain that some material is reserved for allocation to firms that are definitely
shifting from nondefense to defense work so that thej' can maintain their working
forces intact during a short transition i^eriod.

3. We ha\e an arrangement with the Defense Contract Service whereby we
call to their attention cases and areas of present and prospective labor displace-
ment so that the Defense Contract Service may survey the equipment of the em-
ployer or branch of the industry in order to ascertain what defense orders could
be produced by that equipment.

4. The possible use of substitute materials as a means of maintaining existing
working forces is a matter that is taken up with the Conservation Service of the
Office of Production Management, whose special job is the use of substitutes to
conserve on strategic materials.

5. When, for various reasons, an employer is unable to shift to defense work
or to a substitute material and is forced to reduce his employment, arrangements
are made for the United States Employment Service to register his workers for
employment in the expanding defense program.

LIAISON, UNIONS-O. P. M.

In order that the representatives of the labor that may be affected Ijy priorities
or other Office of Production Management action may be fully advised and may
in turn offer advice and proposals to the commodity chiefs in the Office of Pro-
duction Management who are administering the priority, production, and pur-
chasing program in each commodity, there are in the Labor Division two repre-
sentatives, one approved by the American Federation of Labor and the other by
the Congress of Industrial Organizations, who serve as liaison with their respective
organizations. In addition, because of the growing impact of priorities ui)on
labor, a number of special advisers are being appointed from national labor
organizations, so that there will be an adviser to the Labor Division from the na-
tional union directly involved in a particular commodity or industry, especially
in those industries most affected by priority orders.

Furthermore, defense labor advisory committees, corresponding to the defense
industry advisory committees, are being established. The labor advisory com-
mittees will consult with the staff of Government experts in the various com-
modity sections and advise them on those aspects of defense production and
priorities that are of primary concern to labor, as the industry advisory committees
will consult and advise on matters of primary concern to industrial management.
Section 2 of Office of Production Management Regulation No. 8 explains the
selection of these labor advisory committees as follows:

"Whenever in the judgment of the Director of the Labor Division of the Office
of Production Management the interests of national defense will be served thereby,
he shall invite the representatives of labor in an industry in which there is a com-
modity section in the Office of Production Management to nominate delegates
to comprise the membership of a Defense Labor Advisory Committee. The
Director of the Labor Division shall appoint the members of each Defense Labor
Advisory Committee. He, or such officer of the Division as may be approved
by him, will act as a point of clearance for the committees and keep records of their
membership."

NATIONAL DEFENSE MIGRATION 6393

TESTIMONY OF SIDNEY HILLMAN— Eesumed

Mr. HiLLMAN. We want to ostublisli the practice b}' which, when a
defense industry needs workers, it will promptly use the facilities of
the nearest public employment office for both present and pending:
needs. That office will arrange for the necessary workers to be found
locally if they exist locally, and otherwise will arrange to locate them
in the speediest manner possible. The greatest single need in coping
with this problem is that all defense employers make use of the public
employment system; and this they are doing increasingly. By this
means, together with other steps in the program, vocational training,
in-plant training, and a generally systematic handling of defense labor
supply, now under integrated supervision, we are confident that the
labor needs of defense can be met without the evils of an undirected
flow^ of labor. [Reading ends.]

Mr. Sparkman. Thank you, Mr. Hillman. I think that is a very
fine and clear statement.

A good many of the questions that I had outlined are answered in
the statement. But there are some others which 1 would like to ask
you and have your comments on.

PLANS FOR 3-SHirT, 7-DAYS-A-WEEK OPERATION

Has your Office any estimate as to the time when the \arious
defense industries may be expected to go on a full-time bjisis — that is
a three-shift day and a 7-day-a-week basis?

Mr. Hillman. We have no estimates about all mdustries. We
are following each industry to find out whether they are utilizing at
least two shifts a day and, if not, why not.

We are doing it in the aircraft industiy right now and in the ship-
building industry and, of course, in the Ordnance Division, but we
haven't got as yet an estimate of all of them because, gentlemen,
they must first have the ordei-s before thej^ can do that.

Unless our defense program is planned so far ahead that there is
sufficient backlog of work we can't possibly ask the employer to put
on two or three shifts because he may not have orders to carry him
that far.

Mr. Sparkman. As I get it yom- idea is that if it becomes necessary
it can be done?

Mr. Hillman. We are doing it right now. We are following it
up in the aircraft industries because there are sufficient orders placed
to utilize all the facilities and all of their labor. The same is true in
the shipbuilding industry.

estimated total labor requirement

Mr. Sparkman. What are the present estimates of the total labor
requirements for the defense industries? I notice in your statement
you gave increases that we might expect?

Mr. Hillman. We expect about, for next year, conservatively,
3,000,000 additional workers will be required for the defense effort,
and that goes for the increase in the next vear. You mav be mter-

5394 WASHINGTON HEARINGS

ested to know that our estimates of today show that there are 2,700,000
people workmg directly on defense contracts as against 400,000 people
in equivalent employment exactly 1 year ago.

Mr. Sparkman, Let me get that clear. There are 2,700,000 em-
ployed in defense industries today?

Mr. HiLLMAN. Yes, sir.

Mr. Spaekman. As against 400,000 people a year ago?

Mr. HiLLMAN. Yes. This is an employment gain of 2,300,000 —
that is, additional people. And then we have the people who are
working short time and people who are working a great deal of over-
time.

Mr. Sparkman. Now, your additional 3,000,000 will be in addition
to the 2,700,000?

Mr. HiLLMAN. That is right.

Mr. Sparkman. In other words, you estimate that a year from now
the total number employed will be 5,700,000?

Mr. HiLLMAN. Of course it depends on the needs of the program.
As we go along we find that we are increasing the defense program.
Of course it is our task to see to it that if the program calls for a
greater expansion that we go ahead and secure that expansion.

Of these 2,700,000 people working on defense contract_s 1,000,000
are directly engaged in defense-construction projects relating to ship-
building, aircraft, and ordnance and similar undertakings.

NUMBER OF MIGRATORY WORKERS TO BE STUDIED

Mr. Sparkman. How many of these additional workers, these
3,000,000 additional workers, will have to be brought in from other
centers?

Mr. HiLLMAN. Congressman, I can supply that information, but
it will take a little more study. It depends on how much we utilize
the existing facilities.

Now, we are making every effort to bring about more subcontracting.
Mr. Mahorney will give you all we are doing along those lines. A
great deal is being done now to get the load spread by breaking up the
prime contracts into subdivisions so that we can place it where existing
facilities exist. The more we do that, the less we will need new people.

The same thing is happening in replacing some of the consumer
goods, especially the durable consumer goods, with defense projects.
Of course, as to how successful we will be in that effort wilt depend
entirely on how many more people we will need.

NEW SET-UP OF LABOR DIVISION

Mr. Sparkman. The committee is very much interested, Mr.
Hillman, in the recent reorganization of the Labor Division. I wonder
if you will give us the new set-up.

Mr. HiLLMAN. We have been using what we had before, when I
came here a year ago. We have tried to coordinate the existing Gov-
ernment agencies in connection with the requirements or the possible
requirements for the labor needs. We have called in the existing
agencies and we have ourselves acted as a coordinating agency in
Washington, and the agencies themselves have carried through the
policy in the field.

NATIONAL DEFENSE MIGRATION 6395

Now, it may be interesting to you to show you the number of
agencies that do the planning and pohcy makmg for our requirements.
It takes in the apprenticeship committee representatives from the
Department of Labor; the W. P. A.; the Bureau of Labor Statistics;
Bureau of Employment Security; Bureau of Research and Statistics
of the United States Employment Service; the Defense Training, a
branch which represents the United States Office of Education ; Negro
Employment Training ; Mmority Groups to see that they are utilized
in our labor supply; Training Within Industry Branch, which is one
of the major branches of training today, with 22 branches throughout
the Nation. In each branch, the top men from each industry, who
have the experience in training within mdustry and who are associated
with labor and industry, comprise an advisory panel of almost 600
people from different industries. These men are on call to try to show
any p^articular firm how to do the best training within industry. The
Priority Branch, knowing ahead what are gohig to be the priorities,
can estimate where work opportunities will be decreased because of
the lack of raw materials. We then try to direct orders to those plants
so they can utilize the facilities in their plants; the Labor Relations
Branch; and the United States Civil Service Commission.

All these groups meet to determine a policy. These directions go to
Washington and directly to the various regions.

In each of the regions there are 12 sections — the country is divided
into 12 sections. In each one all these branches of Government are
coordinated so that if a contract is referred to us and we find we need so
many more thousands of people, through the Employment Service
here we have the survey of available labor. Directions are given how
many to train, what to train them for and where to get them from —
within the vicinity where the contract is let.

We now have coordination and direction from the Labor Supply
Division, of finding the people, transferring them if necessary, from
nondefense industries to defense industries, giving them either pre-
employment training, or giving them refresher courses, utilizing aU our
agencies, including labor organizations, chambers of commerce, na-
tional manufactm^ers associations. All the effort is directed to finding
the proper labor for the task assigned.

METHOD OF CHOOSING LABOR REPRESENTATIVES

Mr. Sparkman. How are the labor representatives in each industry
chosen?

Mr. HiLLMAN. Associated with me in the Labor Division of the
O. P. M. is a committee representing all of the major labor groups — the
American Federation of Labor, the C. I. O., and the Railroad Brother-
hoods. There are 16 of them and I will leave their names for the
record. They are the top men from all these organizations. First
we met once a week and now we meet every 2 weeks or subject to call,
because most of the policies have been agreed to. That is the policy-
making organization for labor. The same kind of thing goes right
down into the field in every region.

(The list was later submitted by the Office of Production Manage-
ment, and accepted for the record as Exhibit H. The committee,

6396 WASHINGTON HEARINGS

known as the Labor Policy Advisory Committee, of the Labor Division
of the Office of Production Management, consists of the following:)

Exhibit H. — Membership of Labor Policy Advisory Committee

Harry C. Bates, president, Bricklayers, Masons, and Plasters International
Union of America.

Van A. Bittner, United Mine Workers of America.

H. W. Brown, international jjresident, International Association of Machinists.

John P. Coyne, president, Building and Construction, Trades Department,
American Federation of Labor.

S. H. Dalyrmple, president, United Rubber Workers, Akron.

Clinton Golden, regional director, Northeastern Region, Steel Workers Organ-
izing Committee, Pittsburgh.

Allen S. Ha3'wc,od, director of organization, Congress of Industrial Organiza-
tions, New York.

Samuel J. Hogan, president, National Marine Engineers Beneficial Association
Washington.

A. Johnston, grand chief engineer. Brotherhood of Locomotive Engineers.

George Q. Lynch, general president. Pattern Makers League of North America.

A. E. Lyon, grand president. Brotherhood of Railroad Signalmen of America,
Chicago.

Charles J. MacGowan, vice-president. International Brotherhood of Boiler
Makers, Iron Shipbuilders, Welders and Helpers of America, Chicago.

George Masterton, general president, United Association of Journeymen
Plumbers and Steamfitters.

Eimil Rieve, president. Textile Workers Union of America, New York.

R. J. Thomas, president. United Automobile Workers of America, Detroit.

D. W. Tracy, formerly president International Brotherhood of Electrical
Workers, now Second Assistant Secretary of Labor.

TESTIMONY OF SIDNEY HIILMAN— Resumed

Mr. HiLLMAN. There are advisers in each region from the Ameri-
can Federation of Labor, the C. I. O., and the railroad brotherhoods.
They work in an advisory capacity if they have a particular situation
in a city like Philadelphia or Chicago or New York.

We have a central group representing the A. F. of L., the C. L O.,
and the brotherhoods that functions so far as labor supply in defense.
I can tell you there is a united labor movement, cooperating with our
defense effort.

Mr. Sparkman. But the fiujil choice is yours — they act only in an
advisory capacity?

Mr. HiLLMAN. They act in an advisory capacity. We ask the local
people to submit names. Of course we hold all the time that it is om-
responsibility, but of comse we always designate the people who are
recommended because the}' are in a better position to know who can
give us the best advice.

PLANS FOR HANDLING LABOR PRIORITIES

Mr. Sparkman. What plans have been made for handling labor
priorities?

Mr. HiLLMAN. These are the plans.

Mr. Sparkman. It is for that purpose?

Mr. HiLLMAN. For that purpossc; yes. The President advised
O. P. M. 6 or 8 weeks ago that he wants the responsibility for that
whole placement put directlj^ on the O. P. M. — in the Labor Divi-
sion— and therefore we have the machineiy which reaches out into
every community; reaches out into every Government agency; into

NATIONAL DEFENSE MIGRATION (J397

labor and management. Therefore we can easily face that situation
and make the best arrangements.

We feel that we have that organization stepped up to all the needs
and requirements. Of course priorities need much more than that.
They are going to have more of them.

ALUMINUM SHORTAGE AS ILLUSTRATION

Let me state two situations that I am handling just now, to give
you the problem we have because of the shortage of aluminum.
Of course the manufacture of cooking equipment has been definitely
curtailed because of the lack of raw materials.

Well, we had a conference in our place between management and
labor and usually we had also the mayors of the communities. Of
course they have an interest. Then there was someone from the
O. P. M., not merely the Labor Division, but someone from the
production end who met in conference with them.

In this case industry and labor have agreed they will give us two
ot their top engineei-s. They will work out something next Thursday
or Wednesday — they are commg into Washington again — and we will
try to find out what contracts that particular industry can adujst
itself to for defense.

When we are given that recommendation we will work with the
services — the Army or Navy or Maritime Commission — and try to
get contracts for them, so we can place more work for defense and re-
place the work that they are losing because of priorities.

Mr. Sparkman. Now, let me ask you with reference to the one you
just mentioned, priorities in aluminum. How many nondefense
workers have been thrown out of emplojanent as a result of that?

Mr. Hillman. Well, I could not give you the exact number, but
I will say, Congressman, unless we make proper provisions for it
there will be entirely too many to feel comfortable about it.

Mr. Sparkman. That is true of aluminum and will be true of other
industries?

Mr. Hillman. Yes. I received a letter which I cannot read — it
is marked "confidential" by the President, addressed to me July 9,
to ask me to give special attention to it.

I am now organizing a committee under Douglas Brown, who
comes from Princeton University, and eveiy Government agency
will be represented. We are tiyuig to work out some way to antici-
pate these problems and get a distribution of the defense Toad so that
we can bring in contracts before they run out of raw materials — if that
is at all possible — on their orders for consumer goods.

numbers shifting from nondefense to defense

Mr. Sparkman. How many workers does your office expect to
shift within the next year from nondefense to defense work?

Mr. Hillman. It depends completelj' on how successful we will be
in it, and I hope we will be very successful. I hope so because I laiow
we have the cooperation of the services — I mean the Army and
Navy and Maritime Commission.

The more we can direct Government contracts to the places that
lose employment because of priorities, the less we will need shifting
from nondefense industries into defense industries.

5398 WASHINGTON HEARINGS

Where we are not successful, of course, we will have to transfer
them and retain them for additional use. Of course there will be
considerable grief going on with that, because we just can't do it
overnight.

Mr. Sparkman. Do you believe that this shifting can remain on a
voluntary basis?

Mr. HiLLMAN. I believe so. So far, Mr. Congressman, we have
done it on a voluntary basis and it has been working very successfully,
and I propose to go about it on a voluntary basis. We will ask the
employers to think of guaranteeing the worker his place back when
the emergency is over, with whatever seniority rights attach to it,
and ask the workers to go and take employment in a defense industry
or in a defense job. We are quite sure that we will get the coopera-
tion both from the employers and labor.

Now, of course, if we fail to have that, of course we will have to
lay out new policies, but so far we depend completely on cooperation.

WAGE LEVELS IN FOUR SHIPBUILDING ZONES

Mr. Sparkman. You gave us a very interesting statement about
your Shipbuilding Stabilization Committee. Are the wage levels the
same in all four zones?

Mr. HiLLMAN. No; but they are the same in the individual zones.

Mr. Sparkman. Within each individual zone?

Mr. HiLLMAN. In each individual zone. In other words, we are
trying to equalize it so their pay is the same in the same zone — for
instance, Seattle as well as San Francisco, where we have got sunijar
wages so that people will not move just because they can get 2 cents
more; and of course, the equalization, as you gentlemen realize, was
upward and not downward.

We are dealing in a tight market, but we feel now we have got the
whole shipbuilding industry covered and have got to the place where
workers know they work on a basis of equality.

Mr. Sparkman. And you feel that will cut down migration?

Mr. HiLLMAN. Yes. It has cut it down already. It has given us
stability. So much so that we want to spread it to other industries
where it is applicable. The shipbuilding mdustry, in a sense, was
our guinea pig. We had two organizations, as you laiow, the A. F.
of L. and the C. I. O. fairly evenly divided — I am not quoting per-
centages— but we put them together and they have worked co-
operatively all the way through.

They were all represented. There was no friction between the
representatives. We had the representatives of the industry — five
of them, elected by their groups in a conference held for that purpose —
and the representatives of the Navy and the Army and the Maritime
Commission, under the auspices of the O. P. M. After they had
gone through with considerable discussion we found that we have
a splendid pattern. It should assure us continuity of production
and, because of that — the greater ejfficiency and no strikes and no
lock-outs and proper provisions for adjudication of any complaints
that may arise — the services are so well satisfied that they are anxious
to see us spread it to other industries, if that is at all feasible.

Mr. Sparkman. You doubtless are familiar with the Shipbuilding
Labor Adjustment Board of the first World^War?

NATIONAL DEFENSE MIGRATION 6399

Mr. HiLLMAN. Yes, sir,

Mr. Sparkman. After which, I take it, the Shipbuilding Stabiliza-
tion Committee is probably patterned. At that tune, though, even
after the rates were made uniform throughout the country, migration
from area to area still took place as a result of the differences in rents
and other causes that may have come up,

Mr. Hillman. Of course we are trying to avoid the mistakes of the
last war.

Mr. Sparkman, I am speaking of the housmg program,

PROVISION FOR HOUSING INSUFFICIENT

Mr. Hillman. The housing situation, of course, is one of the things
that are more and more pressing. Of course, gentlemen, we depend
completely upon what provisions Congress will make for us in provid-
ing housing for defense.

Now, this is in the spirit of social reform, if that is desirable, but
we can't get efficiency unless people get proper housing; we can't hold
the wage scales if rents shoot up way out of reach and therefore ample
provision for housing for national defense is absolutely essential. It
is no saving if we are sparing money in providing housing for defense.

Mr. Sparkman. Are you satisfied with the provision made for
houses?

Mr. Hillman. It is not sufficient. I don't think we have done
enough. I think it is more and more apparent right now that our
housing situation is one of the things we are short of,

Mr. Sparkman. Has it created any difficulties for your Division in
obtaining the necessary labor supply?

Mr. Hillman. A great deal.

Mr. Sparkman. For industries?

Mr. Hillman. A great deal. We can't expect people to live in
places where four or five people have to get in two rooms or live in
something like barracks — and haven't even got the barracks. We
can't expect them to do that. It isn't fair to do it. It is socially
undcshable and it interferes with the defense program. We can't
get good work out unless we give them proper environment.

Mr, Sparkman, Some manufacturers have testified before the
committee concerning the housing difficulties of their workers. Some
of them have told us that private builders cannot buOd the houses
profitably within the rent range that defense workers can afford to
pay, I wonder what yom- idea is about that,

Mr, HiLLAiAN, I think there is a great deal to that. This Govern-
ment is going to spend a great deal of monej^, must spend it for the
defense effort. Now, housing should be charged as a proper cost of
the defense effort. If we are going to raise rents we will have to
provide the additional wage scales to take care of it.

I prefer what we have just done — we have stabilized labor costs
through collective bargaining, through agreements. Now the thing
that is disturbing us, of course, is the unjustified rise in the cost of
living, and you gentlemen know that rent is one of the major items
and therefore we are being penny-wise and pound-foolish when we do
not make proper provision for housing.

60396 — 41— pt. 16 7

6400 WASHINGTON HEARINGS

EFFECT OF FROZEN WAGE STRUCTURE

Mr. Sparkman. Let me ask you another question about your ship-
building stabihzation work. It has been charged, I beUevc, that the
effect of that is to freeze wages at a time when rents and food prices
are rapidly rising. Those critics argue that such freezing is against
the interests of labor. What is the answer of your office to that?

Mr. HiLLMAN. Gentlemen, of course, all we have done in the ship-
building industry is what we are trying to do through every collective-
bargaining agreement — what was done in the steel industry and in
the automobile industry. Fortunately for the country we have stabi-
lized wages, although only for a term of a year or so. In any labor
contract these things are agreed to for a term of a year or two and in
that sense you are freezing wages.

Of course you gentlemen can "unfreeze" it, if we don't do som.ething
about not permitting the general cost of living to get out of reach.

Now, that, gentlemen, is again your problem and I believe we all
ought to keep away from inflation if we possibly can.

I am going out of my field, but, gentlemen, if we get into inflation,
of course, all that we are doing will have to be kept on being revised.
But if we can get stability we will get the utmost for our defense effort.

STABILIZATION COMMITTEE FOR AIRCRAFT

Mr. Sparkman. You mentioned in your paper the creation of a
stabilization committee for the aircraft industry also.

Mr. Hillman. We are just exploring it now. We are starting it,
not in a full way, on the Pacific coast.

Mr. Sparkman. For what other industries or to what extent does
your office contemplate stabilizing industries?

Mr. Hillman. I think we have reached an agreement on construc-
tion, which is one of the major things. Practically all the Govern-
ment agencies — five agencies — and the labor groups affected by that
have met and, surprisingly, in less than 3 weeks' work, have come to
a tentative agi'eement which I expect will be ratified in the next 10
days. So we have these major things — construction, shipbuilding,
and if we can get aircraft — and that is where we would like to make
sure we have a Nation-wide sense of stability.

Of course the coflective bargaining through the steel industry,
through their organizations have, in their own way, brought that
stabilization.

Mr. Sparkman. Mr. Chairman, that is all that I care to ask.

The Chairman. Mr. Curtis?

prevention of price rises

Mr. Curtis. Mr. Hillman, you suggested that it was the problem
of Congress to prevent a general rise in prices. How do you propose
that we could do that?

Mr. Hillman. I suppose Mr. Henderson, and others who are
working on it, will in the proper time bring it to you. Far be it from
me to

Mr. Curtis. I am glad you have confidence in him.

Mr. Hillman. You gentlemen will have the opportunity to discuss
it. Certainh^ I am not authorized to speak for the administration on

NATIONAL DEFENSE MIGRATION 640]

that, but I am simply pointing to stabilization on the general propo-
sitions as necessary if we are not going to get the migration and chaos
that comes from inflation. As to how to do it, I am sure people
who have that responsibility will speak before your congressional
committees.

Mr. Curtis. We visited one section of New Jersey that annually
produces about 22,000,000 cans of tomatoes for ordinary sales. The
Government came in and bought, for the Army and the Navy,
17,000,000 cans of those tomatoes. Now, when these 22,000,000
customers start to bid on the 5,000,000 cans of tomatoes the price is
going up, isn't it?

Mr. HiLLMAN. Not that I am shirking in answering you, but
Mr. Donald Nelson will appear before this committee^ — or his repre-
sentatives will — and it is right in his alley — he is responsible for
purchasing. But I will say this to you, in general, I think the answer
to it is to get more tomatoes, and I think we can get them.

Mr. Curtis. I am in favor of that. I have always been against
the doctrine of scarcity.

DECENTRALIZATION OF DEFENSE INDUSTRY

Do you favor if at all possible, decentralization of defense activities?

Mr. HiLLMAN. The Labor Division as far back as July or August
last year submitted to the Defense Commission that, from the point
of view of labor supply, we wanted to utilize facilities everywhere —
labor everywhere. Let me read to you the general principles covering
the letting of defense contracts.

Mr. Curtis. Is that a long statement?

Mr. HiLLMAN. No; just a short piece:

Orders should be placed in such a manner as to insure the most efficient use of
each particular facility from the point of view of the problem as a whole; that
proper consideration should be given to contributory industries, such as the
machine-tool industry, to avoid creating underlying bottlenecks, and undue
geographic concentration of orders should be avoided, both as to procurement
districts and as to industrial sections within any such procurement district.
Reasons for such decentralization relate to factors of military strategy, as well as
avoiding congestion that will slow down production.

Mr. Curtis. Do you favor placing of defense activities where
possible in agricultural areas to use the surplus labor supply there?

Mr. HiLLMAN. We do. We put in Wichita, Kans., big plants for
bombers, and, of course, will have to draw a great deal on agricultural
labor and we are drawing on it.

Mr. Curtis. They had an existing plant there?

Mr. HiLLMAN. No; they were new plants.

Mr. Curtis. But Wichita has been one of our important airplane
manufacturing cities; has it not?

Mr. HiLLMAN. Just latety; they were small before that.

SHOULD condition OF WORKERS BE SUBORDINATED TO DEFENSE RUSH?

Mr. Curtis. Now, I have one more question: If an attempt in a
defense plant to improve the condition of the workers as to wages,
hours, or closed shop means an immediate slow-up of defense pro-
duction, do you believe that an attempt for improvement should be
made or should it be deferred until after we are adequately prepared?

Mr. HiLLMAN. Gentlemen, these matters, if they are basically right,

^402 WASHINGTON HEARINGS

will not slow up production. My judgment is, if you defer it you
slow up production. You need a labor force to feel that whatever is
fair — I say "fair" — will be given proper consideration. In that field
we have increased the conciliation staff of the Labor Department.
We have put in O. P. M. machinery as well lately with the Aviation
Board, but anyone who suggests deferring things that are fair and
feasible is not working for speeding up defense.

Mr. Curtis. Your answer would be then that even though it means
a slow-up of defense production that it should be done?

Mr. HiLLMAN. I am saying, Congressman, from my experience of
30 years in labor relations that you get greater productivity when we
have increasing wages.

I am satisfied the next 6 months wall show very little additional
cost to the Government, if any, because satisfied labor will give greater
production.

Mr. Curtis. But suppose this attempt means a closing of the
plants and there is no production, you still think it is advisable?

Mr. HiLLMAN. Pardon me ; we are trying all we can to stop these
interruptions, but if you go into the totalitarian system of prohibiting
strikes and prohibiting interruptions, you have to prepare to take
the consequences which, in my judgment, taking out the ethics of it,
is contrary to the system of government we want. That would also
■slow up production. You must accept a few tlimgs as a natural
.situation.

Of course we try to minimize it. We try to bring it down to the
minimum and we have been fairly successful in bringing it to a very,
very minimum — this interruption of work.

Gentlemen, this thing has been given a much greater importance
from the point of view of national-defense program than it calls for,
but we are doing all we can to minimize it — to bring it to a minimum —
to bring it, if possible, to zero, but we do not propose to cure it by the
kind of a cure that is worse than the disease.

My judgment, gentlemen, is that we today are doing better in
production than, in similar situation, the totalitarian governments
have done. My judgment is that we can attain and we are attaining
and we are going to attam greater production, much more than even
the optimists had hoped for.

It took time for tooling. It has to. You can't start in production
before you tool up for it, but it is my firm conviction that you can
get greater production through a cooperative labor group and a coop-
erative management group, than through the totalitarian system.
Where that system breaks down, it is because it has lost that spirit
of cooperation.

STRIKES ON THE CLOSED-SHOP ISSUE

Mr. Curtis. Would your answer be the same in reference to a strike
that did not involve wages and hours but involved a closed shop?

Mr. HiLLMAN. I would saj^ to you, Congressman, every time there
is a difference there ought to be a place for them to straighten out the
differences and they are doing it in 99 percent of the cases. The
record of that stoppage is that it is of very short duration. I don't
know. Congressman, of any system where you can keep the
democratic method and at the same time apply complete coercion,
;and even though we may have a few incidents, I would say that we

NATIONAL DEFENSE MIGRATION 640S

should still hold to the democratic way of doing it, because it is the
best way for production as well as for a way of iivmg. I see that
from past experience and especially from my experience of this year
in the national-defense program, definitely charged with responsibility
in the labor field.

Mr. Curtis. Would you then oppose the drafting of men into the
Army?

Mr. HiLLMAN. How is that?

Mr. Curtis. Would vou then oppose drafting of men into the
Army?

Mr. HiLLMAN. Oh, no, no; not at all. We all have to carry that
responsibility, to defend the Nation and it ought to be done on a basis
where everyone is doing it, of course.

Mr. Curtis. That is all.

The Chairman. Mr. Osmers?

NUMBERS INVOLVED IN WORK STOPPAGES

Mr. OsMERS. Mr. Hillman, at the present time how many, approxi-
mately, are involved in work stoppages throughout the country — in
round numbers?

Mr. HiLLMAN. 1 haven't got the figures. It changes from day to
day. I would say, as far as the national-defense program is concerned,
I don't believe the number is 10,000— probably 8,000.

Mr. OsMERS. The question I was leading up to there was this:
Do you think that there is indicated in the labor situation any further
need for legislation by Congress?

Mr. HiLLMAN. Gentlemen, I have testified time and again, even
during heated times, that there is no such need at this time — that it
would be unfortunate if a time comes when there would be need for it.

The labor situation now, I am happy to say, proves my contention —
we do not have today a smgle strike, that I know of, that is
troubling us.

Mr. OsMERS. Don't you feel, Mr. Hillman, that it would be a
tragedy for us to take away from labor its legitimate right to strike?

Mr. HiLLMAN. I think it would be wrong from all our traditions
and I think further than that, that it would slow up defense instead
of increasing its speed.

STABILITY OF WAGES AND PRICES

Mr. OsMERS. Now, changing the thought for a minute. I was
tremendously interested in what you said about stability, because if
we have a problem ahead of us. particularly during the next year as
everything expands, we have the problem of stability — stability of
labor — and this committee is concerned with that stability with
respect to wages and, of course, prices.

Mr. HiLLMAN. That is right.

Mr. OsMERS. Now, I realize that you are not here to testify on
price fixing, if and how, but you did make some remarks which to
me seem contradictory and I would like to clarify that point in my
own mind.

You expressed the view that because of higher wages we were going
to increase production over the next 6 months to quite a marked degree^

^404 WAvSHINGTON HEARINGS

in your opinion. You realize, of course, that those increased wages
are a part, probably a very basic part, of the beginnino:' of the spiral.

Mr. HiLLMAN. Well, Congressman, of course, I have given that
consideration and thought and study for years — for at least a couple
of decades and there is no final answer to that.

Mr. OsMERS. I appreciate the theory

Mr. HiLLMAN. Just a minute. I may say that you can get every-
thing to an absurd proposition. Of course you can raise wages where
it must be reflected in costs — and I am not going to give an expert
point of view on what has happened until now — but I would say it
is reasonable to expect that the increase of production that is taking
place, that in most cases industry can absorb the increases right now,
because of the reduction in overhead.

You remember that labor cost is only a part of the cost that goes
into final production and if an industry, whether it is steel or auto-
mobiles or textiles, can increase its 50 percent production to 75 or
80 percent the reduction in the general costs more than make up
for the increase in w^ages. We are now going into figures of 100 per-
cent and more — maybe to 150 percent.

I do not accept the position that the increases that have taken
place up to date should disturb, in any appreciable degree, living
costs to those working in major industries.

WAGE IMPROVEMENT IX CALIFORNIA

Mr. OsMERS. Now you see you run into some subsidiary things
there. You go into a State like California — and you create a large
aircraft industry right out of the air, you bring thousands of men into
that State, you pay attractive wages.

Mr. HiLLMAN. Yes, sir; although we haven't paid them attractive
wages as yet.

Mr. OsMERS. Not particularly, but they are attractive compared
to what the vegetable pickers are getting in the Imperial Valley.

Mr. HiLLMAN. That is right.

Mr. OsMERS. Now, carrying on through, you take the men out of
the fields in California.

Mr. HiLLMAN. That is right.

Mr. OsMERS. And even if they are only paying $20 a week in the
aircraft industry that looks pretty good to a man who has been work-
ing only 2 or 3 months a year.

Mr. HiLLMAN. Very well.

Mr. OsMERS. And what happens to 3^our agricultural economy
and yom- food costs?

Mr, HiLLMAN. Well, I hate to be one of these experts, because I
always think of the experts before the twenties, in the early twenties
and then in the thirties.

Mr, OsMERS. We have been "experted" to death,

Mr. HiLLMAN. I am not testifying as an expert. I will say to you,
Congressman, that in the over-all situation w^e will be better off if
those sectors of labor, whether in agricultural situations or otherwise,
are raised up to a decent standard of living, and that if something
has to be paid in that regard it is more than worth it because you
wouldn't have to pay it in relief and W. P, A. That is purely cold-
blooded economics, financial economics, but after all there is more

NATIONAL DEFENSE IIIGIIATION (3405

than that. We want a situation where all Americans will be able to
enjoy a decent standard of living.

Fortunately for us the country can afford it and I don't like to see
a skilled laborer taking advantage in buying the food because of under-
paid people in that area — but that is completely out of my field.

Mr. OsMERS. I am sure that this committee, after its experience in
California and elsewhere, particularly in depressed agricultural areas,
agrees with the contention that one of the great tasks before this
country as a whole is to raise the level of the living of our agricultural
workers.

Mr. HiLLMAN. Now, gentlemen, we can do that. Right now we
are doing it through the defense program and we are at the same time
helping national defense. That is the reassuring thing that we are
doing right now, it is all helping the defense program — all speeding
up production.

APPARENT ECONOMIC STABILITY IN GERMANY

Mr. OsMERS. There is something that has occurred to my mind,
Mr. Hillman, and I have asked several witnesses about it. Possibly
you may know nothing at all about it, but how does Hitler produce
the apparent economic stability that he does in Germany?

Mr. Hillman. Well, I would say that, while I don't know the
inside lately, I do not think there is anything about Hitler which
should raise any question that he is doing more than we could do if
given the time.

Mr. OsMERS. I am not raising that question.

Mr. Hillman. He wanted stability by using slave labor. Now,
we don't want that — and it won't last there for very long, because
slave labor has not lasted any place. History records that. The
people under Hitler are temporarily in slaverj^ but they will not stay
in slavery forever. Of course you can do that as long as you have
the physical power to do it and as long as a countr}^ is willing to stand
for it, but there is nothing that I have seen that would call for us to
imitate it. They have done everything by coercion. What we are
doing is through the process of cooperation.

I do not agree with those who believe that Mr. Hitler has invented
some new ideas. He has just gone back to the dark ages and is
using all the implements of torture with the new refinements — bombing
and with all these other things. Germany and the subjugated coun-
tries have to accept it, but it won't last much longer.

Mr. OsMERS. It is your understanding then — and I gather this
from your statement — that inside Germany and of course inside the
territories under Germany's control, they follow an absolutely fixed
economy — an economy that is fixed as to wages and fixed as to loca-
tion of work, hours, pay, and everything else, and there is absolutely
no leeway, no liberty whatsoever; that the price of butter is fixed
at so many marks a pound, and when the butter is gone that is the
end of it, and if you don't get it, then you don't get any butter.

Mr. Hillman. That is all fixed, the way they can think or walk or
travel or anything else.

Mr. OsMERS. In other words a worker cannot move from one place
to another?

Mr. Hillman. Not unless specially permitted.

g408 WASHINGTON HEARINGS

SHIPYAED STABILIZATION AGREEMENTS

Mr. OsMERs. Now, I want to ask a question about the shipyard
stabilization agreements. Is it true that those agreements have
been signed?

Mr. HiLLMAN. Most of them.

Mr. OsMERS. Have those agreements raised wages in certain plants?

Mr. HiLLMAN. All the increases have been agreed to m conferences
that took place with the representatives of labor and industry.
Government was just sitting there to see what was done.

Mr. OsMERS. Was that done without coercion or otherwise?

Mr. HiLLMAN. It was done tlirough the process of collective bar-
gaming. , .

Mr. OsMERS. Did these agreements raise wages m certain ship-
yards?

Mr. HiLLMAN. Oh, yes; obviously.

Mr. OsMERS. They were not gained by strikes or anytliing else —
they were negotiated?

Mr. HiLLMAN. In my opinion it was the finest demonstration of
collective bargainmg, nationally, that I ever saw, where the needs
of labor were straightened out around the conference table.

Mr. OsMERS. I agree with you.

Mr. HiLMAN. And that is what has been done.

Mr. OsMERS. And I hope that you are successful in extending that
same principle to the aircraft industry, and I think you will be.

Mr. HiLLMAN. I hope we will be.

PREPARATIONS FOR POST-EMERGENCY LET-DOWN

Mr. OsMERS. Now, is your office or is any office of the Government
making plans at this time for the let-down that is bound to come when
this emergency and this war is over?

Mr. HiLLMAN. Well, I would say that is not the responsibihty of
our office. I am quite sure others are giving attention to it. As a
matter of fact, I am quite sure they are and all that I hope for is that
what we are doing right now — the better cooperation that is going
on in the country — may help in building a mechanism to carry it
through. It would be most disastrous to the Nation and to civili-
zation if it doesn't do it, and I think we will.

Mr. OsMERS. I would like, if you will, to be just a little more
specific about your statement that you are quite sure others are
studying the problem.

Mr. HiLLMAN. I think the President has charged other people with
the responsibility of doing that.

Mr. OsMERS. You don't know what people or organization?

Mr. HiLLMAN. I wouldn't say.

Mr. OsMERS. Because every witness, and particularly witnesses of
a capacity such as yours, has seen immediately the need for such
planning and the desirability of working out some possible emergency
plans; but when I get down to the specifics of the situation, they are
always quite sure something is being done but nobody is quite sure
just what and where.

Mr. HiLLMAN. I would say we are doing the major job right now
in industry. Labor and [Government are cooperating during this
emergency and doing it successfully. I think the future will show how

NATIONAL DEFENSE MIGRATION 6407

successful we are and that we will be able to cope with all our prob-
lems, if the "timetable" abroad will permit us to do so. I believe the
same mechanism we are using now, w^ith the same support back of us,
will take care of our situation then.

I see no reason why we cannot keep all the people employed on the
kind of things that the country needs after this emergency.

Mr. OsMERS. You mean on consumer goods?

Mr. HiLLMAN. On consumer goods, of raising the standards of life,
of giving everybody security. I have always believed that it can be
done and that the only way you can do it is through the democratic
process. And I believe you know that a great deal will^depend on
Congress^ — what you gentlemen want us to do.

Mr. OsMERs. You believe that it will be possible to convert the
war economy, if we want to call it that, that we are now engaged in,
that we will be able to convert that into a peacetime economy?

Mr. HiLLMAN. Gentlemen, I have testified here and, of course, I
couldn't make our plans clear in the allotted time. We are trying,
first of all — and I hope we will be successful in some degree— not to
disturb our economy right now too much. We are putting defense
orders into the same plants where we make automobiles, so that this
same plant, with its management and its labor, can just proceed on
a backlog of orders for automobiles and refrigerators and other things
after this present emergency ends.

Now, gentlemen, 1 know that we have never supplied even half of
the demands of great numbers of people, of what they would like to
have and, frankly, what they are entitled to have. With the resources
that we have we can do it, if we just have the will to do it and the
country is back of it. Nothing can be done unless the country is
back of it. I am not disturbed about that. It can be done, and I
hope it will be done.

Mr. OsMERS. That is all, Mr. Chairman.

The Chairman. Congressman Arnold?

EFFECT OF PROPOSED LEGISLATION ON STRIKES

Mr. Arnold. Mr. Hillman, just a few short questions on a subject
that I consider you an expert in.

You spoke of the rather satisfactory condition of the strike condi-
tions in defense plants at the present time.

Mr. Hillman. That is right.

Mr. Arnold. Could the legislation that has been pending in Con-
gress for the past month or so have had any effect on that situation?

Mr. Hillman. That is a matter of one's guess. One person's guess
is as good as another. Congressman. I have advocated consistently
that we do not go in for coercive measures. I have a great faith in
the great mass of people, labor as well as others, and I believe that we
ought to approach this problem on the basis of saying: "Gentlemen,
we are preparing to defend the things that are of the utmost import-
ance to every American, to every worker and we want your
cooperation."

I think we can get more that way and therefore I have consistently
opposed some of the measures you have mentioned, because I think it
would interfere with national defense. I do not believe that the fear
of legislation has done it, gentlemen. You are dealing with millions

5408 WASHINGTON HEARINGS

and millions of individuals. What is giving us that better situation is
the greater appreciation all the time by American labor of what is at
stake. They know that when they work on defense work they are
working for the country and defending themselves and the larger
values that we are all working for.

DOES NOT EXPECT MORE STRIKES

Mr. Arnold. A member of the Military Affaii's Committee, who is
very much interested in some of the provisions that were eliminated
from the bill last week, expressed to me yesterday his opinion that
labor would break loose now and we would see more strikes than we
have seen in the past.

Mr. HiLLMAN. I differ with him completely. I believe labor is
wholeheartedly back of the defense program and I believe that the
policies that this administration followed of helping labor achieve its
proper objectives — proper, not improper objectives — without inter-
ruption of work is giving greater confidence to the great masses of
people that this defense program is not in the interest of a few — that
it is in the interest of the entire Nation and that we have a right to
ask of them their utmost cooperation.

Mr. Arnold. Well, I want to say that I Imow some great work has
been done by your organization and by the President in settling defense
strikes.

declares COMMUNIST INFLUENCE INSIGNIFICANT

Would the fact that Russia is now engaged in war with German}^
help the labor situation?

Mr. HiLLMAN. Congressman, although I have heard so much of
that, I really believe it is insignificant, one way or the other. You
must always have faith in the American laboring man. I have seen
them for 30 years from the inside and 99 percent and the majority of
the other 1 percent are just good Americans, not interested in any
alienisms and never were.

Mr. Arnold. But a good many people and some Members of Con-
gress, have thought that the communistic element was more in sym-
pathy with the ideals of Russia and its teachings than those of America,

Mr. HiLLMAN. But their numbers are so few and their influence is
so insignificant, and in any individual places where they had signifi-
cance we were completely able to cope with it and we have coped
with it in one or two situations. There has never been a major dis-
turbance because of them. Personally, I am more disturbed about
following the policy of not doing what is fair with the people of the
country, whether it is labor or management or the average man.
They have a right to expect us to follow a policy of fairness in our
defense program and not work for one group or another group or
give any group any advantage.

Mr. Arnold. You look forward with confidence to the full coopera-
tion of labor?

Mr. HiLLMAN. If we keep on with a proper policy and if, all the
blame is not charged to labor. There are, unfortunately, a few — but
entirely too many — who are trying in different ways to discourage
the defense program. Of course, they influence part of labor and
they must accept the responsibility more than the small groups we
we are talking about. People are telling the country at large that the
defense effort is uncalled for, unjustified.

NATIONAL DEFENSE MIGKATION 6409

Well, of course, that must have some effect on some Americans,
who happen to be part of labor, but even that, I am satisfied, is
nothing really to be disturbed about.

Mr. Arnold. You would think some of those elements that are
speaking over the radio today were in the employ of Hitler, wouldn't
you?

Mr. HiLLMAN. I am not saying that but I say they have to accept
full responsibility for what follows from it.

Mr. Arnold. That is all.

COERCION doesn't WORK

The Chairman. As I get your idea about strike legislation, Mr.
Hillman, we are liable to think in terms of the perfect picture. That
is, if we pass strike legislation everytlhng will be 100 percent perfect,
France tried that with her edicts and found it didn't work. Isn't
that true?

Mr. Hillman. Anyone who has tried that found it didn't work.
I do not know the number of people in concentration camps in Ger-
many, but probably there are more people in those concentration
camps than have participated in strikes. They have their way of
doing it. Assume there is a strike there, in a couple of days the
strikers are in a concentration camp and not back at work.

The Chairman. But Mr. Hillman, England never tried it and
Canada did try it and they had illegal strikes, isn't that true?

Mr. Hillman. I would prefer not to discuss that at this time. It is
my considered judgment that we, here in this country, with the labor
that we have and the general feelmg in the country, and the policies
that we have been guided by in the past, are going to get and we are
getting most of our efficiency in production by labor through follow-
ing a policy of cooperation that will enlist its support. It is not a
question of — "Well, we better do it or something will happen to us" —
not happen to us merely as workers, but happen to all of us.

The Chairman. Thank you very much, Mr. Hillman.

Our next witness is Mr. Robert L. Mehornay.

TESTIMONY OF ROBERT L. MEHORNAY, CHIEF OF THE DEFENSE
CONTRACT SERVICE, PRODUCTION DIVISION, OFFICE OF PRO-
DUCTION MANAGEMENT, WASHINGTON, D. C.

The Chairman. Mr. Mehornay, Congressman Arnold will inteiTo-
gate you.

Mr. Arnold. Mr. Mehornay, will you please state yom- name and
official position?

Mr. Mehornay. Robert L. Mehornay, Chief of the Defense
Contract Service, Production Division, Office of Production Manage-
ment.

volume of subcontracting

Mr, Arnold, Mr, Mehornay, how much subcontracting is being
done at the present time?

Mr. Mehornay. Our best records at this time apply to subcon-
tracts under primary contracts in excess of $10,000. We do not go
below that figure in our records.

^410 WASHINGTON HEARINGS

At the present time there are approximately 18,000 prime contracts
over that amount and by the priority extension records, which are
kept, there are 366,000 subcontracts and sub-subcontracts applying to
those 18,000.

Mr. Arnold. What method is the O. P. M. using to check up on
the quantity of subcontracts?

Mr. Mehornay. We are using four methods now. The figures
which I have just given you come from the Army and Navy Munitions
Board where application for extensions of priorities are reported. In
addition to that we follow very closely the spot checking of the
Ordnance Department because of the very complete records which
they keep, and that sample checking of their orders shows 22,000
subcontracts applying to 1,450 prime contracts.

We also through our own research and statistics department have
a continuing check by direct inquiry to the prime contractors. I have
only a percentage report on that and not the figures, but it shows as of
this time that 25 percent, by dollar volume, is being subcontracted.
The other figures were all applicable to number of contracts.

Mr. Arnold. Subcontractors file with the O. P. M. for priority
rating. Do you make any studies from these records of the extent of
subcontracting?

Mr. Mehornay. Mr. Congressman, they do not file with O. P. M. ;
they file with the Army and Navy Munitions Board where the granting
■of priorities based on the prime contractor's priority is authorized
and is recorded, and that was the figure which I used in the first
instance.

We do not keep priority records for subcontractors — we do for prime
"Contractors.

COMPULSORY SUBCONTRACTING IN ENGLAND

Mr. Arnold. What do you think of compulsory subcontracting
such as is required in England?

Mr. Mehornay. I do not think it is necessary for us to go to all-
out compulsory subcontracting. I have the theory that we should
take all of our bids on a modified executive basis, holding them open
for negotiation, then the apparently successful bidder or the group of
acceptable bidders, as to the price and their ability to produce, should
be brought in and through negotiation the amount of subcontracting,
the purpose of the subcontracting, the speed and the spreading possi-
bly through that subcontracting, should be determined and be given
heavy weight in influencing the letting of that contract. Then that
agreed amount by items to be used, to be contracted, or the option
to be performed, should be written into the contract.

In other words it should be a negotiated portion of the contract
and not predetermined in the bid called.

Mr. Arnold. Are you satisfied with the amount of subcontracting
that is being done today?

Mr. Mehornay. No, sir.

Mr. Arnold. It has been suggested that the big prime contractors
are waiting for priorities to squeeze the small producer into taking
subcontracts on a cost-of-production basis. Does this coincide with
your knowledge of the present situation?

Mr. Mehornay. No, sir; I have no knowledge that would indicate
that that is true. Rather to the contrary. Our continuous checks

NATIONAL DEFENSE MIGRATION 6411

with the prime contractors disclose none who flatly refuse to do sub-
contracting. There are many who can explain to you why it is not
possible or practical for them to do it, but none who flatly refuse.

Mr. Arnold. Are most of the present subcontracts in the hands of
present prime contractors?

Mr. Mehornay. I am not clear, Mr. Congressman, as to the intent
of that question.

Mr. Arnold. Are prime contractors subcontracting to other prime
contractors — is most of it in that direction?

Mr. Mehornay. It would be only an observation on my part. It
is so mixed that it would be merely an observation. No records are
kept. Many of our most important prime contractors are at the
same time subcontractors to other prime contractors. The condition
is readily admitted and is very voluminous but we do not have the
percentage or the ratio.

DISTANCE PENALIZES SUBCONTRACTING

Mr. Arnold. Will subcontracting really spread the defense work
throughout the Nation or will it intensify the present concentration
of contracts, in your opinion? It has been hoped that it would
spread it out, but will it really do that or will it intensify the present
concentration?

Mr. Mehornay. It will not spread it out and will leave the con-
centration normal until the load becomes sufficient to necessitate its
moving out further and further from the prime contractor. Naturally
a man is going to do business with point closest to him, all other
things being equal. If we could eliminate that distance penalty
that the far-oft" subcontractor must pay in his freight differential
from him to the prime contractor, we would have removed one of
the big obstacles to spreading the subcontracts further away from the
prime contracting base.

Mr. Arnold. That is all, Mr. Chairman.

The Chairman. Thank you very much, Mr. Mehornay. You have
given us some very valuable information to include in our report to
Congress.

The committee will stand adjourned until 2 o'clock.

(Whereupon, at 12:30 p. m., the committee adjourned until 2
p. m., the same day.)

AFTERNOON SESSION

The committee met at 2 p. m.

The Chairman. The committee will please come to order.
Our first witness this afternoon is Mr. William Green, president of
the American Federation of Labor.

TESTIMONY OF WILLIAM GREEN, PRESIDENT OF THE AMERICAN
FEDERATION OF LABOR, WASHINGTON, D. C.

The Chairman. Mr. Green, we appreciate your coming here to
testify before us.

As you know we have been all over the United States, last year
investigating the migration of destitute citizens from one State to
another and, during this session, the migration of workers on account
of our national-defense program.

We are very much interested in this defense migration. I have read
your statement very carefully and I think it is going to be a very valu-
able contribution to this committee.

Congressman Curtis, of Nebraska will ask you a number of questions.
I think in that way we will accomplish more than by a reading of your
statement at this time. Your entire paper will be made a part of the
record.

Mr. Green. That will be quite agreeable.

The Chairman. And following the hearing this week if there is
anything further you would like to add to your statement, the record
will be kept open for a few days.

Mr. Green. In view of your explanation, Mr. Chairman, I wish to
report that I have a supplemental statement that I will be glad to
include in the record.

The Chairman. I wish to say this to you, Mr. Green, that this is
the first committee in the history of Congress dealing with human
interstate commerce. We have had plenty of investigations about
iron and coal and steel but never before have we investigated our
interstate traffic in human beings.

This is a very important hearing and we are going to report back to
Congress on what we find out, so anything you have to add we will be
glad to make a part of the record.

Mr. Green. Well, I will submit this statement along with my
other statement. This statement includes replies from our local or-
ganizations scattered throughout the entire United States to a ques-
tionnaire we mailed to them asking that they tell us what the situation
is in their respective localities. I think you will find it very valuable
and very interesting.

6413

g414 WASHINGTON HEARINGS

(The statement and supplemental material referred to above are
as follows:)

STATEMENT BY WILLIAM GREEN, PRESIDENT, AMERICAN
FEDERATION OF LABOR

The Part of Organized Labor in Defense Migration

Very early in the development of the defense program it became apparent
that, in spite of a stupendous volume of unemployment, local demands for par-
ticular types of skills could not ahvaj^s l^e filled locally. Labor leaders knew that
there would be great migrations of workers to new areas, both those directed to
particular jobs and those just hoping to find some job. Sometimes the mere
announcement that defense funds would be used in some city was enough to start
a trek toward that place, long before the work was ready. Sometimes employers
have started the migration by indiscriminate advertising for workers. What-
ever the cause, labor knew we must face and solve the problem of unnecessary
migration as well as the temporary and local shortages for certain skills. The
American Federation of Labor is concerned with both these wastes in the defense
program. We want them eliminated while our liberty of individual action and
our rights as union workers are preserved.

union cooperation in supplying men to jobs

In the summer of 1940, as soon as we learned that large numbers of skilled
workers would be needed for defense construction, international unions affiliated
with the building- trades department of the American Federal of Labor made a
survey of their affiliated locals to find out the number of unemployed members
seeking work and those who would be willing to go to other towns.

To set up within our building-trades department a great defense-employment
exchange was not difficult, for our international unions already serve their mem-
bership as Nation-wide employment offices. Business agents in local unions
normally act as placement agents, referring men to jobs. Therefore we had
only to bring information together in central headquarters to establish a clearing
house covering the entire Nation.

With this information in hand we were ready to act at once. Calls for skilled
craftsmen came urgently for cantonments, for powder plants, for airplane fac-
tories, and all the varied types of defense building. Calls to our building-trades
department from contractors or from the United States Government were
quickly transferred to the international unions and men sent to the job. In
Charlestown, Ind., to build the huge du Pont smokeless-powder plant, 23,000'
workers were required. Charlestown was a tiny place of 900 inhabitants; there
was no nearby source of labor supply sufficient to meet the need. Labor for this
job was recruited literally all over the United States by our unions, and sent
promptly to the spot. Men came from thousands of miles away. And this
entire job of labor recruiting was done by union offices without a cent of e.xpense
to the Government or to contractors for the huge task of contacting the men and
transporting them to the work.]

L/VBOR recruitment ELSEWHERE

Similarly, in Fort Leonard Wood, Mo., where 29,000 men were needed to build
the cantonments, labor was recruited within a radius of 200 miles and sent
promptly to work. Men came in their cars, bringing a carload of workers with
them. The cars then served to transport workers between their lodgings and
their work, for often it has been impossible for our members to find lodging within
even 25 miles of the jobs, and drives of 40 or 50 miles morning and evening have
been the daily lot of very many.

In Jacksonville, Fla., it was necessary' for our organizations to send plumbers all
the way from New York. In Corpus Christi, Tex., our organizations have
supplied over 23,000 construction workers, who transformed a wilderness into the
most modern airplane training station in the world, and completed this job 6
weeks ahead of schedule. In Camp Shelby, Miss., we supplied the work force to
build what amounts to a small city to house 67,000 soldiers. The following
structures were put up: 13,000 tent frames, 414 mess halls, 80 warehouses, 56
administration centers, a laundry, a hospital, 34 post exchanges, 85 miles of water
mains, 60 miles of sewer, 65 miles of paved roads. This work was completed
ahead of schedule, costing the Government only $20,000,000 compared to the

NATIONAL DEFENSE MIGRATION 6415

estimates of $22,000,000 for the job. In Fort Belvoir we completed a camp to
house 20,0C0 soldiers in less than 3 months. In Ravenna, Ohio, we are supplying
over 12,000 men for the construction of the $14,000,000 Atlas Powder Co. loading
and ammunition plant. We drew labor for this job from all over the country, and
work is proceeding up to schedule.

In building the cantonments for the United States Army, we have in effect con-
structed 46 small cities in 6 months' time. These cities house anywhere from
20,000 to more than 60,000 men, and involve the building of living quarters,
powerhouses, roadways, stores, hospitals, laundries, mess halls, sewage systems,
water-supply lines.

The labor supply for this colossal task has been furnished by the international
unions aflRliated with our building-trades department, as noted above, without
any cost to the Government or to contractors. When an international could not
furnish all the men needed, the requirements were filled by cooperation with other
internationals. The International Association of Heat aiid Frost Insulators and
Asbestos Workers, for instance, having more calls than they had men to supply,
agreed to accept members of the Operative Plasterers' International Association
of the United States and Canada unions able for the work, without charging either
initiation fees or dues.

METAL TRADES UNIONS H.WE ASSISTED

Unions in the metal trades have also contributed. The International Associa-
tion of Machinists has recruited men for work in navy yards, arsenals, airplane
plants, and other metal work from the entire country. Registration of unem-
ployed machinists began on May 23, 1940, at international headquarters and has
continued to date. Local lodges have been alert to notify the International office
immediately when they foresaw that new work would require additions to work
force.

In Bremerton, Wash., for instance, the navy yard lodge advised headquarters
that a large number of machinists would soon be needed. The international
immediately sent job specifications with rates of pay and requirements to all
lodges west of the Mississippi. Men were advised that medical examinations
would be required, urged to take these examinations before leaving for the job;
they were instructed to send their qualifications to the Bremerton office and be
ready for immediate summons. In this way Bremerton was able to mobilize its
work force with a minimum of waste motion. The Bremerton lodge met the men
on arrival and assisted them in getting quickly registered and on the job.

Similarly, the machinists recruited 3,000 machinists and 1,650 tool makers for
the arsenals, airplane mechanics for Vultee and Lockheed, and men for many
other defense jobs.

LINK WITH EMPLOYMENT SERVICE

The supplying of skilled union men to jobs was further improved and speeded
by linking our union employment activities with the United States Employment
Service. This was necessary because we found that in spite of the great demand
for skilled workers and our activities in referring them to jobs, literally thousands
of workers were traveling around looking for work, not knowing where to go.
Clearly we needed centers of call, and it was obvious that these could best be
furnished by the 1,500 local offices of the United States Employment Service.
LTnion placement is not in competition but cooperating with the United States
Einployment Service.

On June 20, 1940, following a pledge of the executive council of the International
Association of Machinists to support the preparedness program, officials of that
union met with the Director of the Employment Division of the Bureau of Em-
ployment Security to work out an understanding of the operating methods of the
public employment offices and methods of cooperation between them and the
grand-lodge representatives, business representatives, railway general chairmen,
and local lodge officers. Following the agreement reached at this meeting the
International Association of Machinists advised its lodge officers and business
representatives to make immediate contact with local emj^loyment offices and
arrange for a suitable plan of getting all unemployed members registered and also
for registering machinists temporarily employed in occupations not requiring their
highest skills.

In July 1940 I wrote all the central labor unions affiliated with the American
Federation of Labor, urging their cooperation with local employment offices to
work out plans which would get every unemployed union member registered at
the public employment offices, and would also preserve the established union

60396— 41— pt. 16 8

g416 WASHINGTON HEARINGS

placement channels of those unions prepared to supply employers directly with
union workmen. At that time, also, I requested our central labor unions to
cooperate in working out needed training programs in local communities in order
that an effective labor supply would be available when and where reeded.

With help from our union members, the National Employment Service prepared
a statement of procedure to be followed by local offices in plachig workers both
when union contracts are in existence and when an employer calls for workers
without designating union affiliation. The purpose of this procedure was to
assure the most effective use of all channels of labor placement to get men onto
defense jobs promptly, and to preserve the functions of union placement and
protect the rights of union members under contracts.

The International Brotherhood of Electrical Workers made a notable contri-
bution to working out detailed procedures for a better control of the labor supply
on defense projects. It held a series of regional conferences throughout the
United States in the early months of 1941, bringing together clearance officers of
the United States Employment Service on State and regional levels, business
managers, international representatives, and vice presidents of the union and
representatives of the Labor Supply Division of the National Defense Commission.
These meetings were designed to help organize the labor supply, to avoid local
shortages of skilled workers, and to prevent wasteful and aimless flocking of
workers to areas where jobs are not ready for them. The problem is similar to a
traffic jam — the aim of the conferences was to find ways to route work crews most
efficiently and with the least friction, to use the union members nearest to the job
rather than to send men unnecessarily long distances, perhaps to find the jobs
filled when they arrived.

Out of these conferences detailed procedures for cooperation between the
United States Employment Service and the unions on all levels were developed.
Local business representatives work with the local employment offices, interna-
tional representatives with State offices, and so on until national clearance is
reached when our international oflfices cooperate with the national Employment
Service clearance office. This cooperative plan opens up a quick job-clearance
system throughout the entire country, making thousands of highly skilled union
rrien immediately available for defense work and enlisting the cooperation cf our
unions. It has had great success throughout the country and has speeded the
defense program.

THE WILL TO MIGRATE

As long as free enterprise is operating, men will seek work where they get the
best bargain. A number of factors enter into the choice of jobs. If a man is
unemployed he will, of course, take a job under conditions which would not tempt
him to leave a job he has. Among the things he considers are wage rates, general
working conditions, distance from his home, chance to use his highest skill and to
advance, and what he has to give up in the way of seniority and retirement rights
if he leaves his former job, and the relative permanence of the two jobs. Defense
jobs have to offer equal or better opportunities than are open to workers in other
lines or they won't attract enough men.

Congress recognized the need to make Government contracts attractive to
business men when it passed the special tax and amortization laws. Additional
incentive to take defense contracts is created by priority rulings on materials
which make it possible for a manufacturer to continue operations on defense
when he would have to close his plant if he stuck to his former line. Material
and machine priorities similarly act as a powerful lever to move workers into
defense jobs. But there must also be some inducement in the conditions of the
job to attract and hold enough men.

One such inducement would be the use of a revamped social-security program
which would not discriminate against many defense workers as the present one
does.

In spite of the fact that the first selective service call took men from private
jobs into the Army more than 6 months ago, no legislation has been passed to
protect the rights they had been building up to old age and survivors' insurance.
A little over half the States have frozen rights of draftees under their unem-
ployment compensation laws, but the meager benefits and limited coverage of
most laws plus the fact that many persons exhausted their benefit rights before
they went into service and have iiotliing left to "freeze" make these provisions
less effective than apparent in many cases.

Not even that much has been done for workers called from private jobs into
civilian Government service. The navy yards and arsenals have expanded their
working forces materially. From July 1940 to April 1941 the average number of

NATIONAL DEFENSE MIGRATION 6417

workers on Federal civilian pay rolls as defense production workers and in other
■defense employment increased by nearly 200,000 exclusive of the Work Projects
Administration defense work and of additions to nonmilitary regular Government
agencies which also have increased their staffs to handle new problems created
by defense. Many of these workers have been drawn from private employment
where they had been building up both unemployment compensation and old-age
and survivors insurance rights. Government service provides no protection
against later unemployment, and the Civil Service Retirement Act, which still
does not cover all P^ederal workers, provides no benefits for survivors and no
continuing protection if a worker leaves the service, as most of these defense
workers will, before retirement age.

Take the case of a worker with a wife and two small children, who has had 3
years of employment covered by old-age and survivors insurance, at an average
wage of $100 a month. If he should die his family would receive a little over
$45 a month until the children reached 16 years of age, or 18 if they were still in
school. That means he has built up for his family protection equal to the income
from more than $13,000 at 4 percent. If he leaves his job to work in a navy yard
or on a Government force-account job and dies after he is no longer in insured
status under old-age and survivors insurance, his family would have no income.
Can the worker throw away that equity lightly? He should not have to take a
•less favorable situation in Government defense work than he had previously.

UNEMPLOYMENT COMPENSATION SYSTEM AS IT AFFECTS MIGRANTS

Of course defense work for private companies is not subject to this disadvan-
tage. Our system of unemployment compensation, however, may operate to the
disadvantage of migrants whether they go into Federal service which gives them
no rights or into private defense employment in which the amount of protection
-depends on the diverse State laws. For construction workers, moved from one
defense site to another as needed, the State unemployment compensation laws
may prove of little use. Since earnings in several States cannot be pooled to give
■eligibility in any one State, a migratory worker may easily find himself unem-
ployed with no rights to compensation in spite of a considerable amount of pre-
vious employment. State experience rating laws impose unnecessary hardships
on contractors, since the very nature of defense work demands large working
forces who will complete the job quickly and who will have to be laid off at the
end of the work in that area to seek employment elsewhere.

The records of employment offices showing the huge number of workers sent
across State lines for jobs or traveling voluntarily in search of work testifies
eloquently to the fact that employment and unemployment are phenomena na-
tional in scope. We ask for a national system of unemi)Ioyment compensation
with Nation-wide adequate standards of benefits and the end of the discrimina-
tory system of experience rating which has no part in such a period of employ-
ment as lies ahead and which can only make more difficult the building of a sound
system to meet postdefense unemployment.

DISMISSAL WAGE SYSTEM

We ask also for a study of a supplementary system of contributory dismissal
wages in defense employments to overcome the disadvantage of the temporary
nature of such employment. When workers leave or are forced out of their
customary work by priority orders which cut off the supply of materials on which
they formerly worked, they may lose real equities in seniority agreements, in
plant retirement systems, and in the normal expectation of continued employment.
Defense work is expected to be temporary. If justice is done to those forced into
it by priorities and if it is to be made attractive enough to induce many other
workers to accept defense jobs voluntarily, these equities should be compensated
for. Unemployment compensation alone, limited as it would necessarily be
even under reasonable standards, is not adequate for that purpose.

Furthermore, some such system, which would hold back part of the higher
wage workers will be getting in the defense plants and add to it something from
the defense profits until the end of the current crisis or until a personal emergency
in the worker's family made the use of such savings necessary, would serve to
check inflation now and to offset decreased employment income later.

Housing

The machinery for routing workers to defense areas worked out by our unions
and the United States Employment Service is intended to get men on the job

g418 WASHINGTON HEARINGS

where they are needed. Providing for them in the new area is another problem.
Frequently, other considerations dictated the location of defense plants, and
particularly of military camps, away from larger communities. The small cities
and rural areas which have received the influx of new workers have frequently
been overwhelmed by the problems of housing and otherwise providing for their
new residents.

The defense emergency has pointed up the lack of adequate housing for the
working people of this country. The accumulation of large numbers of workers
around defense plants has made the situation more urgent, but it is a problem that
has existed for many years. We are suffering now from this housing shortage in
part because we did not build more homes at an earlier date.

We have underbuilt for more than a decade. During the 10 years from 1920
to 1930 there was an average of over 650,000 nonfarm homes built each year, but
for the 4 depression years, 1932 through 1935, the average dropped to 82,000;
that is, only 12 percent of the number constructed during the preceding period.
Although the number has increased since that time, it has not yet reached 550,000
homes a year. This backlog must be caught up with.

The National Resources Planning Board estimates that we need over 2,500,000
nonfarm homes to relieve the accumulated shortage now existing in this country.
This does not include special defense needs. The United States Housing Au-
thority estimates that by 1950 we will need 10,000,000 more nonfarm homes than
we have at present. This means building at the rate of 1,000,000 a year, or more
than double the rate of the first quarter of 1941.

The defense program, of course, forces an upward revision of these estimates
because, in some instances, the labor force will migrate from towns and cities with
high vacancy rates to others already crowded, and from farms to towns. As a
result, houses in some locahties remain vacant, while in other sections of the
country many more will have to be built.

And these figures do not tell the whole story, for this housing shortage hits
almost exclusively people in the low-income groups. Therefore, these homes must
be built to rent or sell for a price the average wage earner can afford to pay.

An effort is being made at this time to meet this situation through both public
and private enterprise. However, this effort is still a long way from being ade-
quate. The American Federation of Labor, through its central labor unions and
State federations, has just completed a survey of conditions existing in towns and
cities in which there is a sizable amount of defense work. The results of this sur-
vey indicate overwhelmingly that the need for more and better housing is still
very serious.

The areas for which information was gathered can be divided roughly into three
groups: (1) Those in which the situation demands further immediate attention,
where overcrowding has already reached a serious stage and where measures
already taken or planned are hopelessly inadequate; (2) those in which it is ob-
vious that the situation will very shortly become serious unless further steps are
taken at once before the new defense plants get into full production; and (3) a very
few localities where, for various reasons, the community is apparently still able to
handle the situation as it has developed so far,

BAD SPOTS IN DEFENSE HOUSING

Here are some of the conditions our unions report:

In Corpus Christi, Tex., 20,000 additional workers have been added to the
96,000 permanent residents of the city since the start of the defense program, an
increase of more than 20 percent in about a year. In addition, about 7,000
workers had to be housed temporarily while construction work was in progress.
These new workers are now living in any available accomodation, including
tourist camps, trailer camps, tents, shacks, and automobiles, while rents on per-
manent living quarters have advanced from 75 to 200 percent. Some of the tem-
porary workers could get no shelter of any sort and were sleeping in the open.
Government agencies have built or are building 1,700 units, and about 500 units
are being built privately. Obviously, this program will not fill the need.

Brownwood, Tex., was equally swamped. Houses normally renting for $20 a
month shot up to .$60 and higher. From Abilene and Mineral Wells we heard
complaints that the rent for a cot in a crowded tar-paper shack with no sanitary
facilities was $3 a day. Other workers were paying $60 per month apiece to
sleep two in a bed. This is what our men had to return to after a full day's
work.

The situation in Gadsden, Ala., is critical. In this important steel and iron
center the industrial expansion has brought in about 1,250 permanent workers,

NATIONAL DEFENSE MIGRATION 6419

with 5,000 more expected there within the next few months. These men with
their families are living in old and leaking slab huts (made from slabs taken ofif
green lumber), in garages, barns, stables, old store buildings, and shacks with
dirt floors, with no sanitary facilities whatsoever. Unless the situation is rem-
edied before winter there may be acute suffering. At least 1,000 new homes are
needed here instead of the 250 that are now being built by the Government.
Private capital is reluctant to build homes at a price the workers can afford.
Rents have gone up on the average worker's home about 33)^3 percent. The work
of expanding Camp McClellan, about 23 miles from Gadsden, added some 3,500
temporary workers to the town's permanent population and further complicated
the housing problems.

Reports from Wichita and Parsons, Kans., show grave problems there. With
airplane factories operating under capacity contracts in Wichita, the city of some
120,000 persons has already absorbed 15,000 permanent workers witli at least
40,000 expected by the spring of 1942. In the last 6 months about 1,000 dwellings
have been erected by private capital, but these are chiefly offered for sale. The
Government's building project so far includes only 400 family units with another
1,000 in prospect. The outlook is bad for that expected flood of new residents.

Already it is impossible for workers to find houses to rent to which they can
bring their families. Single workers can rent space in rooms in private homes.
With from two to four sleeping in every available room, workers are paying $5
to $6 per week apiece for space in a double bed in stuffy basement dormitories
housing 6 to 12 men.

A serious situation confronts the city of Parsons, Kans., a community of about
14,000. Here there is still a chance to anticipate the housing needs because the
main part of the defense work has not begun. There can be no delay, however.
The Federal Government has approved a $35,000,000 shell-loading plant to be
located in Parsons. This will mean some 4,000 construction workers for the period
necessary to bui'd the plant, and about 6,000 production workers for its operation.
These latter, being fairly permanent, will certainly want to bring in their families.
It is easy to see the problem is acute and immediate.

This city, center for the general oflRces and shops of the Missouri, Kansas &
Texas Railway Co., has never had many vacant houses for rent. The railroad
is increasing its personnel and this adds to the demand for decent living quarters.

Burlington, Iowa, a town of about 27,000 in normal times, reports that upward
of 20,000 workers of all types have come into the town as a result of the construc-
tion of a shell-loading plant there. According to city officials, there was a short-
age of housing even before this plant was constructed. The increases in rent
show what is happening here. Houses normally renting for $25 to $30 a month
now cost $54 to $65, and single rooms in private homes, for which normally from
$3.50 to $5 a week was paid, are now bringing $10 a week, with two or three cots
in each room. The Government has built reasonably satisfactory barracks on
the site of the plant but these can house only a small proportion of the workers.
Trailer camps have grown up all around the plant, with sanitary conditions at
their worst. A few new houses are being constructed, but the rents are exorbitant.

PROJECT NEEDED IN BUFFALO

Our union people in Buffalo, N. Y., have been trying since last September to
secure the housing facilities which they foresaw would be needed when the defense
program got under way. So far, they say, "1,000 housing project units have been
approved for this area; 200 in the city of Lackawanna and 800 in the city of
Buffalo. The present estimate of new workers for this area is 25,000 and they
will be employed here by January 1, 1942." It would seem that a large-scale
housing project should be planned immediately for this section, and there should
be no delay in its execution. Our people see that private capital cannot or will
not provide the necessary facilities at prices within the range of the wage earner.
Either the Government must build these homes, or higher wages must be pro-
vided so that the worker can afford to pay the rents demanded by private industry.

The situation in Schenectady will be acute by fall unless some 1,000 to 2,000
dwelling units are put up. The General Electric Co. anticipates needing more
than 5,000 men by October. The American Locomotive Co. will take on about
800. Probably a number of these men will come in from outside the community.
A rough estimate shows about 3,000 new people already in the city since the
start of the defense program. There has been little private construction in
spite of the showing of need. In May only 290 house units were vacant, more
than half of those classed as slum dwellings. Banks have been reluctant to finance
decent homes at workers' rent levels and realtors have opposed labor's demand

Q420 WASHINGTON HEAEINGS

for a State housing project. Rents for workers' homes are rising and relief is
badlv needed.

The situation in Tacoma, Wash., illustrates again the fact that the housing
program has consistently dragged behind the need for more homes. The de-
fense program has brought at least 10,000 fairly permanent residents into this
city, besides the 45,000 soldiers stationed at the 2 nearby camps, and the 4, COO
building tradesmen employed on the construction of these camps. Thousands
of workers came to this area because of publicity overstating the number of
workers that would be needed. The only Government building that has been
carried out here to date consists of 350 units for married enlisted personnel in
military service. A million-dollar housing program is being considered, but has
not yet been adopted, notwithstanding the 10,000 workers that have already
been'added to the population.

CONDITION SURROUNDING ARMY CAMPS IN RURAL AREAS

The most crucial situations have come about, usually, where plants or Arm}^
camps have been built in locations far removed from any good-sized cities. For
instance, the construction of Camp Blanding in Florida required the employment
of 20,000 men. The nearest town was Starke, which ordinarily had a poDulation
of only 1,500. Jacksonville, the only sizable city within reach, was 50 miles
away.' Of course, workers found it impossible to get suitable living accomoda-
tions. Many lived in their cars, in trailers, covered trucks, hovels made of scraps
of metal, building paper, and even palmetto leaves over rude frames. Houses
in towns within a radius of 75 miles were badly overcrowded, and rents went up
alarmingly. One of our members reports that he was able, by getting there
early, to find a summer cottage 2 miles from the camp. This had no modern
conveniences, and usually rented for from $20 to $25 a month. He paid $45 to
begin with, and was paying $60 by April. The contractors built barracks for
1,500 of the 20,000 workmen, and even this limited provision was late in being
finished.

Spartanburg, S. C, had a difficult time while temporary workers prepared the
adjacent military camp (Camp Croft). With most of the temporary construc-
tion workers gone now, the city has left some 8,000 new permanent residents,
workers, families of officers, and others drawn to the community in the last year.
Rents have increased from 40 to 75 percent for people trying to find homes.
Ev3n for homes continuously occupied rents have gone up at least 10 percent.
SoTie relief is expected from the 270 family units for low-income workers now
be'ng completed and 120 units for the families of officers, but these will still not
so've the problem entirely.

These reports are illustrative of what is happening all across the country.
I will file for your later consideration a summary of many more such statements
from our union representatives in defense areas.

All of the towns surveyed reported rent increases, varying from 10 to 200 per-
cent, with many telling of increases of 35, 40, and 50 percent for homes rented
to new workers coming into the town. In a large number of the towns substand-
ard and condemned buildings unfit for human use were being reoccupied, and in
others where private construction seemed to promise an adequate number of
homes, the rents for these units were beyond the reach of the wage earner's income.
Even where low-cost houses are providing for some workers the units do not
release other homes for newcomers to an eqtiivalent extent, because frequently
it only permits the undoubling of families in dangerously overcrowded dwellings^

OPPOSITION TO labor's EFFORTS

Because most of these communities have insufficient funds to handle so big a
problem, Federal aid on a large scale is necessary, but the cooperation of all local
groups is also vital if a sensible solution is to be achieved. Organized labor
groups in these cities and towns are capable of a fine contribution in this respect.
The results of our survey tell us that these men and women know the situation
in their localities, and are not only willing but eager to help find the jsroper answer.
In some areas this help is being sought and accepted in a fine spirit of cooperation,
and a real job is being done. In others, opposition to labor's efforts is found on
all sides. In the answers to our questionnaires we found many complaints that
representatives of organized labor were not given a change to cooperate; that real
estate men opposed Government-financed housing programs; that banks were
not interested in financing low-cost housing. This is an emergency situation,
and no special interests should be allowed to stand in the way of dealing with it
swiftly and efficiently.

NATIONAL DEFENSE MI(4KATI0N g421

The housing problem is no new one, and it will still be with us when the defense
emergency has passed. The defense program has made quick action of primary
importance, but we must not lose sight of the future. The homes that are built
today should become a worth-while permanent contribution to the community.
This can only be done if local authorities study their city, and devise well-thought-
out plans coordinating defense needs with the ordinary peace-time demands of
the community-. When the defense industry that brought these additional people
into a city is a thing of the past, it should be possible to use these homes in place
of the disgraceful slum areas which mar most of our cities.

A comprehensive housing project has long been recognized as one of the cushions
against a slump in our economic system when we are able to shift over again to
a peacetime economy. For this reason, too, present construction of houses should
not sacrifice sound planning while achieving the requisite speed. Each com-
munity should be concerned to have a program that both takes care of the present
and looks to the future.

What we need, then, is first of all more homes, many more, and as fast as they
can be constructed. Secondly, they must be built to rent for a price the average
worker can afford. And finally, they should be well built, rightly situated and
well planned so as to be a real asset to the community in the future. This sounds
like a compHcated and difficult job, and it is, but it can be done if there is whole-
hearted cooperation among all interested groups. In all of these communities,
there are able and eager members of the American Federation of Labor who are
anxious to contribute their knowledge and experience toward finding the most
constructive solution of their local problem.

Health

Many of the health problems arising from defense migration have their roots
in and are only an accentuation of deficiencies in provisions for community
healtli and industrial hygiene under more normal conditions. W^here a State
or city has had a strong public health department, where sanitary facilities
have iieen well planned, inspection of milk and water supplies efficient, public
clinics ample, and health education progressive, the community is more able to fit
new workers into its life without acute difficulty. On the other hand, when huge
numbers of workers are moved into areas already poorly equipped, when tempo-
rary trailer camDs or civilian barracks are established without proper inspection,
the worst slum hazards are created.

I have already told you of the reports our affiliated unions have given us of the
crowded and undesirable living conditions. While the country has been fortu-
nate to date in escaping any serious eiiidemics, we cannot continue to rely on
good luck. Conditions conducive to the spread of contagious diseases exist in
many communities and must be eliminated.

In many defense areas thousands of workers poured in, hitch-hiking and coming
by car, looking for jobs without definite knowledge of conditions. Many of them
could not get work and had no money to go back home. They live in tents, tour-
ist camps, shacks, and trailers, without proper sanitary provision, creating a
situation which threatens the health of the entire community. This situation
has been particularlv acute around Louisville, Ky., and Charlestown, Ind. In
some cases our affiliated unions have financed the removal of their members caught
in such a situation. Our members in Louisville have been concerned at the
danger to the whole community which is created by the unsanitary shack camps
in Charlestown.

The construction workers at Camp Leonard Wood in Missouri had either to
travel from 20 to 100 miles a day to and from work or live without any semblance
of decency and privacy in pup tents, trucks, or crowded 8 to 10 ni a room. There
were no sanitary provisions in the neighborhood of the camp. These workers,
now being laid off as the camp project nears completion, are transferring in large
numbers to work on the O'Reiley Hospital at Springfield, Mo. While that com-
munity offers better facilities, there will certainly be overcrowding there too.

A similar situation existed in Lawton, Okla., because of the expansion of Fort
Sill. Workers were traveling 10 to 50 miles daily, living in crowded rooms and
even sleeping in automobiles. The county health clinic has been overtaxed and
workers cannot get proper service.

In Mississippi there are no free clinics of any kind in most defense areas, and
the public health department is understaffed. With the permanent residents
already inadequately provided for, the influx of new workers creates a serious
problem.

g422 WASHINGTON HEARINGS

SANITATION PROBLEMS ACUTE IN SMALL CITIES AND TOWNS

In nearly every case in which large numbers of workers are brought to new
areas, especially to smaller cities and towns, sanitation problems are acute.
Even when Federal money has been available for housing, the town's sewage
system is often inadequate for the load placed on it. Often the town has no
riioney for new sanitary facilities and in some cases legal debt limits prevent
further public borrowing.

The city of Parsons, Kans., of which I have already spoken, anticipates serious
difficulties when the size of their community is nearly doubled in less than a year.
The health department is concerned over the water supply, sewage disposal, milk
inspection, and health work, none of which can be properly safeguarded on the
funds now available. This is an immediate concern — Federal aid could help
them prepare for the emergency before the new workers pour in. The safe-
guarding of the health of our workers and their families makes this aid essential.

In Virginia the area between Williamsburg and Fort Monroe faces a serious
health problem because of the pollution of rivers and the bay with sewage. Make-
shift dwellings, such as converted streetcars, tents, trailers, shacks, and con-
demned slum houses in a number of cities, are not only uncomfortable but actually
unsafe without careful planning for an inspection of sanitary facilities, which has
been lacking to date.

A report from Charleston, W. Va., stresses as a special problem the lack of a
uniform milk ordinance and the inadequate inspection of the raw milk which
many dealers supply.

Even some large"^ cities have had to put a dangerous load on existing health
facilities. Philadelphia, still far from the expected peak of defense work, is already
suffering from overcrowding and reoccupancy of substandard vacant homes with
a consequent increase in the tuberculosis hazard. The Philadelphia Department
of Public Health considers tuberculosis and communicable diseases its chief
problems now. The city finances have not permitted any expansion in facilities
for diagnosis and treatment of tuberculosis or for vaccination and immunization of
newcomers, many of whom are from communities which had no proper health
education or compulsory vaccination.

In many areas hospitals are so crowded that there is a long wait for beds, and
hospital and medical costs are too high for workers and their families. We need
more free and low-cost clinics serving all defense areas. Charleston, S. C, con-
siders one of its most serious problems the lack of a hospital in the navy yard area.
Other areas report no hospital or clinic or even first-aid station near large defense
plants. Sometimes seriously injured men have to be taken 50 or 60 miles for
treatment.

VENEREAL DISEASE A MAJOR PROBLEM

Aside from sanitation, venereal diseases are the most acute health problem in
defense areas. This is particularly true on the frmges of camps and in places
where thousands of workers, often without their families, are being brought
together with no proper provision for wholesome recreation. The Army protects
its personnel with prophylaxis and treatment of infections. Every defense area
should have free clinics giving the same service to workers. This is vital for the
protection of the whole Nation.

Not only is defense migration creating serious health problems connected with
overcrowded housing, lack of proper sanitary facilities, increased risk of venereal
infection, and conditions which make the outbreak of epidemics a constant menace,
but also the conditions of work in defense plants are a threat to the health and
safety of workers on the job. In 1940 industrial accidents in all manufacturing
industries increased nearly 13 percent over 1939, with less than 11 percent increase
in man-hours worked. In 1941 the rate of industrial accidents is probably in-
creasing even more.

INJURIES IN DEFENSE PLANT

The record in defense industries is strikingly worse than that for all manufac-
turing. In terms of exposure, the increase in frequency rate (that is, the number
of disabling injuries per million hours worked) was 2.5 percent. But for basic
defense industries it was nearly 10 times that much. In shipbuilding and in air-
craft production the frequency rate of disabling accidents was 22 percent greater
in 1940 than in 1939, in the machine-tool industry the rate increased 23 percent.
That means a great loss in productive manpower as well as increased hardships for
the workers in those important industries when the increases in disabling injuries
were 22 or 23 percent higher than the increases in man-hours worked. We need
immediate measure to reduce this loss from accidents.

NATIONAL DEFENSE MIGRATION 6423

• Safety programs in most plants have not been expanded proportionately to
the number of new workers, and many plants have no safety program. Con-
gestion in the plants, increased tempo of operations, and failure to keep floor
space clean while work is going on are responsible for some of this increase.
New workers and workers rusty from long unemployment or employment at
less than their full skill are more likely to have accidents than those accustomed
to the job. Longer hours of work, as overtime employment mounts, contribute
to cumulative fatigue, and in some defense areas workers are forced to live so
far from their jobs that they spend 2 or 3 hours a day traveling to and from work.
This adds to the work fatigue.

The American Federation of Labor was represented in 1940 in the hearings
on Senator Murray's bill to make more adequate provisions for the control and
prevention of industrial conditions hazardous to the health of employees. At
that time we urged Congress to appropriate more money for this purpose and to
place the supervision of industrial hygiene work done with such Federal funds
under State departments of labor which are charged with the responsibility of
administering labor laws and which have, in most cases, right of entry into
plants for the necessary inspections. We are convinced that this expansion of
industrial hygiene work is more than ever necessary in the present emergency.

Only about half of the workers in our country have the use of first-aid rooms
in their plants. Inspection of plants for dangerous concentration of dust and
for exposure to chemical poisoning is wholly inadequate. We cannot afford the
loss of manpower from defense work needlessly caused by accidents and pre-
ventable ill health. Throughout the year 1940 accidents cost us four times as
manj' man-days lost from production as strikes did. The ratio is probably similar
today. Yet the loss in accidents has received practically no attention, while
strikes have been blazoned abroad.

Serious as the problem has been for years, it is now a major threat to our
defense production. The American Federation of Labor strongly urges that
appropriations be made for adequate safety and industrial hygiene work.

EDUCATIONAL FACILITIES IN DEFENSE AREAS

It is obvious that the migration of large numbers of workers and their families
to defense areas brings with it also the problem of providing sufficient educational
facilities for the children of these families.

A survey of this situation was made at the beginning of the year by the Office
of Education. On the basis of reports sent in by State superintendents and com-
missioners of education, estimates were drawai up indicating that by September
1941 there would be at least 300,000 additional children to be accommodated in
defense centers; a need for over 10,000 more teachers; and the cost of the necessary
extra facilities would run to over $125,000,000.

These are necessarily rough estimaties, and since they were made the picture
has changed in many details — other liousing units have been authorized and
defense plants have been planned for additional towns. These figures, therefore,
must be considered only as an mdication of the minimum extent of the need.
It is probable that if this study were to be repeated now, the estimates would
be higher.

The survey the American Federation of Labor has just made indicates too
that most of these communities expect their schools to be seriously overcrowded
when they open in the fall. In Pontiac, Mich., it is said that schools will be
crowded into temporary shacks withm a year. The report from Pittsburgh
states that there are no schools at all available near the new housing projects.
In Kentucky areas schools were already overcrowded before the influx of new
workers. It is expected that the enrollment in the elementary schools of Omaha
and nearby towns will be increased by about 5,330 pupils. The schools there
have facilities for only 2,725 of these children. Charleston, S. C, is seriously
concerned that their schools will not be able to take care of the increased enroll-
ment.

Because the summer vacation intervened in time to avoid having to face the
problem which was increasing with the expansion of communities, many com-
mimities have some chance to get new school facilities ready before fall.

Where defense plants and housing units are located at a distance from existing
facilities, new schools will have to be built. In other cases, it will mean that
additions must be constructed, and more teachers hired.

Sometimes the local communities are prevented by debt limits from making
any expansion in their school program. A member of the school board of Parsons,
Kans., has written that th^eir- school fund levy is at its top now and no further

^424 WASHINGTON IIEARIN(}S

revenue is available. A new school building under Work Projects Administration
auspices will not be ready for fall unless the program is speeded. A compara-
tively small increase in the school enrollment would require new teachers, and
the expected enrollment would completely disrupt the present school program.
Other cities are in much the same difficulty. When local communities are not
able to bear the burden of extra equipment and personnel needed because of the
migration of defense workers with their families, it is up to the State and Federal
Governments to lend a hand. A program for this purpose should be put into
operation without delay, so that by September when schools reopen minimum
requirements, at least, will be provided for. This is necessary to the maintenance
of a good morale and to the long-time strength of our Nation. We cannot afford
to neglect proper schooling in a democracy if it is to live.

RECREATION

Closely related to the housing and health lacks of defense communities is the
problem of recreation. Our national habit in recent years has turned so strongly
to commercial recreation that we are ill prepared to recognize and solve the
problem created by the influx of a large number of new workers into crowded
areas. While some attention is now being given to the importance of healthful
and desirable recreation for men in the Army, little has been thought of the thou-
sands of workers on construction jobs and in defense plants.

Clearly there are two distinct problems of recreation for the workers removed
from their home communities for defense jobs. There are the large numbers of
workers who come for a temporary period to construct Army camps and defense
plants. Many of these workers are single or have left their families elsewhere.
The housing is even less adequate generally for these construction workers than
for the permanent production workers who come later. The conditions under
Avhich they live are such that they must seek all their recreation outside of their
own living quarters. These men have more money to spend than many of the
soldiers in camp, but except for that difference their problem of recreation is much
the same. They are away from their former friends and living under conditions
which do not give them any permanent interest in the new community. They
have no homes to keep up and improve. They are unlikely to establish church
ties unless the members of the churches make more of an effort than they have to
welcome the newcomers for their temporary stay. Most communities have no
program of helping migrant workers make friendly social contacts. It is small
wonder that the men turn to less desirable forms of recreation.

Then there are workers who bring their wives and children into the new com-
munity. Over a period of time their social contacts will be broader than those
of the single men. However, the presence of the new families imposes an obliga-
tion on the community to provide other kinds of recreation. The children need
playgrounds where they will be safe, and public parks with expanded recreational
facilities to serve the larger population are needed. Adequate cultural and recre-
ational opportunities free and at low cost are needed for workers and their families.
In some defense areas school playgrounds and gymnasium facilities have been
insufficient for the number of children they serve, and often these are closed during
school vacations with no thought of providing for the children's idle time. That is
a poor way to build the kind of community we want in this country.

From a number of defense areas our unions report inadequate recreational
facilities. From what we know of the type of recreation available in many cities,
especially smaller ones, we can be certain that they have little to offer the new
workers brought in temporarily or more permanently for defense jobs. Most of
those smaller places have no money available for new recreational facilities, but
even m.ore — they have no real comprehension of the social value of planning for
sound recreation for all residents. The Federal Government should, along with
its housing program, help local communities develop and improve recreational
facilities both for the workers themselves and for their families. Immediate
plans should be laid to give guidance to those areas which in the near future will
have a large increase in their working populations. This is as important as the
program of the United Service Organization for the armed forces.

This program need not be expensive. The workers do not need or want high-
priced directors getting up entertainments for their passive amusement. They
do not want closely supervised entertainment. They need social centers in which,
with some informal assistance in getting acquainted, they can have good compan-
ionship, in which they can talk, read, listen to the radio, dance, have community
sings, get up their own bands, orchestras, and games if they please — in short, they

NATIONAL DEFENSE MIGRATION 6425

■need a reasonably well-equipped clubhouse for workers in defense areas, especially
in smaller places in which there are no good alternate social opportunities.

Exactly what each community should have depends, of course, on its character,
Avhether it is rural or urban, or within a reasonable distance from a large city.
It must depend, too, on the type of migrants; whether chiefly single workers, or
.families have moved in. Those matters should be determined when plans are
made to build or enlarge a military post or defense plant, and Government funds
and experience should be made available to local communities to help them
establish such needed recreation centers as well as for adequate housing, schools,
and health facilities.

What these workers need is a chance to relax and enjoy themselves in pleasant
surroundings after their day's work, and an opportunity to find good recreation
with congenial companions. As the pressure and strai!i of defense work increase
recreation will become increasingly important in the maintenance of a high
morale. We cannot afford to neglect it or leave it wholly in the hands of those
who hope to profit by selling entertainment to jieople who have no chance to choose
other forms of recreation.

labor's stake in defense planning

The problems which are being created now by the migration of workers for de-
fense jobs will carry over to plague us more acutely in the post-defense period
unless we do sound planning now.

In the first place, we must plan to provide a continuation of jobs in the areas
where defense production has brought in masses of workers, or establish orderly
methods of redistributing labor to other places where they can find jobs at the eid
of defense work. This does not mean compulsory mobilization of labor now or
later, but a program of continued production through the readjustment period
and an even more complete canvass of job opportunities and a more widespread
coverage of the employment service than we have now.

In the second place, to keep pace with the national problem of migration and
face the fact that many of the workers now employed will be laid off for short or
long periods before they get placed in permanent peacetime work, we must have
a national system of unemployment compensation with benefits adequate to care
reasonably for the unemployed workers and to give a substantial lift to community
purchasing power. Our employment market is now Nationwide. Men are freely
moving across State lines and concentrating in defense areas unevenly distributed
among the States. The post-defense problem of unemployment will also be a
national matter and cannot be satisfactorily handled b,y the separate States.
Nor are the wide difference in benefit rights and the tax rates employers pay in
the several States reasonable or desirable in the face of the Nationwide scope of
the problem and the fact that we will have to undo, at least in part, the concen-
tration of workers in certain areas built up for the defense program.

To soften the hardships of readjustment both for men discharged at the end of
military service and workers whose defense jobs are ended and who must either
find new employment or retire from the labor market, we should plan now some
form of dismissal wage which has the double advantage of reducing the inflationary
tendency of the present period and of bolstering purchasing power later when it will
counteract deflation.

PROTECTION OF PENSION RIGHTS

Furthermore, we need now to devise means of protecting the old age and sur-
vivors' insurance rights of persons who go into either military or civilian defense
work. Loss of such valuable rights should not be required of any person serving
the Nation.

In the third place, this defense period should be a means toward improving the
Nation's health standards. It is a disgrace that this richest Nation in the world
should have so many of its young men in their prime unfit for military service be-
cause of nutritional deficiencies and physical defects arising from improper or
insufficient medical care. Clearly a large part of our population cannot afford
the preventive and remedial treatment necessary for good health. Clearly our
State work in public health and industrial hygiene has been spotty and generally
too limited to do the job which must be done.

We need to plan now for an adequate public health program, for disability insur-
ance, and for complete medical care within the reach of workers' incomes. It is
low-income earners who are neglected. Unable to pay for adequate treatment and
vmwilling to accept or ineligible for charity in the form of free care, they go without

0426 WASHINGTON HEARINGS

the attention they need until they contract the most severe illnesses. The health
problems appearing in overcrowded defense communities are showing up also
real deficiencies which have long existed in the facilities available for the average
worker's family. The already inadequate facilities bog down under the added
load of migrants' needs.

Great Britain, in the midst of active warfare and straining every resource to the
utmost for the Nation's life, finds it desirable to give more attention to social
legislation. The Minister of Health recently announced that the Government was
introducing interim legislation to increase the benefits under their health insurance
scheme and that they hoped to carry through later a thorough overhaul of the
social insurance programs, particularly health and pensions insurance and work-
men's compensation. He said: "The Government are of opinion that the com-
prehensive survey of existing schemes, which must be an essential preliminary to
such legislation, should be set on foot at once as part of post-war planning."
Since that time. Sir William Beveridge, a brilliant economist and one familiar with
labor problems, has been appointed head of a committee to make this comprehen-
sive survey and to recommend necessary changes to create an improved and uni-
fied system.

This is the time for us, too, to work for a stronger, healthier population, both to-
have vigorous soldiers and workers, and to build within our democratic system the
kind of living conditions which ought to be denied no one. The basic morale of a
healthy nation would be in itself a measure of defense against foreign doctrine.

AVOIDANCE OF NEW SLUM AREAS

Third, construction of homes now should be governed by a plan which does not
create slum areas in cities and rural communities in the post-defense period, and
which does not saddle workers with debts they cannot meet later. There must be
inspection to prevent colonies of jerry-built houses which will be the nucleus of new
slums. Many of the houses now being constructed sell or rent at a figure too high
for the average worker. We need more genuinely low-cost homes, subsidized if
need be so that persons displaced in slum clearance will not be forced into worse
slums because they cannot afford a decent place to live.

Where the housing problem is obviously temporary, as in providing living
quarters for construction workers building military camps, the use of mobile
units with proper attention to sanitary facilities is entirely proper. We do not
want to waste money for unnecessary houses where they will not long be needed.
The American Federation of Labor has urged the continuation and expansion
of the migratory labor camp program of the Farm Security Administration.
But where a community is growing on a permanent basis, new homes should be
constructed in such a manner that they can replace old slum areas and offer
decent living quarters at a cost workers can reasonably afford. And while new
dwelling units are being added, the Federal Government should help the States
and cities provide for adequate sanitary facilities which the extra housing makes
necessary in local communities.

Fourth, when defense migration puts undue strains on the local school and
recreational facilities, the Federal Government should give such help as neces-
sary to relieve the local community. Defense is a national problem and the dis-
locations which it causes in our living must not be thrown unduly on a few areas.
We can use the necessities of this emergency to improve the opportunities for
all if we are far-sighted in our planning.

The American Federation of Labor stands ready to help in this planning for
post-defense living. Out affiliated departments and unions have many members
skilled in the problems of housing, employment and unemployment, and migra-
tion of workers. We will be glad to contribute our efforts toward sound plan-
ning in a democratic manner for both the defense emergency and the economic
and social adjustments which must follow it.

There is no group that has more at stake than wage earners, in this struggle
that now grips the world. Democracy means to us opportunity to have a voice
in determining our destinies and advancing our economic and social well-being.
Democracy, we believe, leads to a higher level of living and involves acceptance of
responsibility for working out the problems in order to reach that objective.
When danger threatens our democracy we stand ready to give and do.

ORGANIZATION OF A DEFENSE ECONOMY

Preparation for national defense today necessitates the organization of a
defense economy with provisions for the manufacture of munitions and all the

NATIONAL DEFENSE MIGRATION 6427

mechanized defense agencies. Our defense economy may supplement or displace
our production for civilian uses and it has priority. Technicians and workers in
large numbers must transfer from civilian to defense work. The kind of control
or government that is developed for our defense economy is of paramount im-
portance to all workers. In a very positive wa.y government for defense activi-
ties is separate from government for normal living. This defense government
concerns and affects vitally owners, management, and workers in defense produc-
tion, and unless these groups have representation in the defense government these
citizens pass into a dictatorial regime in which they are helpless to protect their
interests or maintain their rights.

In defense operations time is such an important factor that authority to act
quickly and surely must be vested in some one person who can be held responsible
for results. The life and future of the Nation may be at stake. If the responsible
head provides in his organization representation for those who are affected by his
decisions and gives their views and recommendations adequate and continuous
opportunity for consideration, principles of democracy and a sense of freedom will
be maintained even during such emergency as defense and war. This type of
organization is essential to national morale — the will to see the thing through —
and morale is essential to mass effort. In addition to maintaining morale, repre-
sentation for the organized groups concerned brings cooperation for the work and
releases the latent energies and abilities of the whole group because each has the
responsibility derived from representation. To express this another way, if the
defense administration asks a labor repre,sentative to serve in some capacity his
cooperation is gained and that of those he can influence personally; but if the
■defense administration asks the National Manufacturers Association and the
American Federation of Labor to designate representatives to help with the prob-
lems of defense production, these representatives are in a position to get coopera-
tion from their entire organizations.

If policies are democratically evolved, the administrator may be given authority
to carry them out — even though that power may exceed peace limit reservations.
This is the philosophy upon which the American Federation of Labor rests its
claim to representation.

CONTROL OF EMPLOYMENT ACT IN BRITAIN

This has been the procedure in Great Britain. Under the Control of Employ-
ment Act (1939), which empowered the Minister of Labour to prohibit employers
from advertising for or hiring new employees without ministerial consent, any
order issued under this power first was submitted to a committee composed of
equal representation of employers and employees. The report of the committee,
together with the Minister's order, have to be laid before Parliament, which could
void the order. However, the Government did not exercise mandatory power
but continued to rely upon voluntary cooperation.

With the Churchill cabinet came the Emergency Powers Act, May 22, 1940,
which authorized Orders in Council requiring persons to place themselves, their
services, and their property at the disposal of the Government. The Minister
of Labour has power to direct any person to take any job, to require any class
■of persons to register information about themselves, to inspect premises, and
require necessary records. The Minister is empowered to determine wage rates
and working conditions for persons filling jobs to which he directs them.

The Minister immediately ordered that in key defense industries, building,
civil engineering, contracting, and general engineering, employers should engage
workers only through the Labor Exchange. No male worker in coal mining or
agriculture may transfer to another industry except with the approval of the
Labor Exchange, and on becoming unemployed, workers formerly employed in
these industries must return to them. Dock workers were required to register
and in most cases registration was in the hands of committees of employers and
workers. Later all skilled workers were required to register and to give informa-
tion on work experience. When these orders were issued the Minister of Labour
announced he still relied upon unions and employers" organizations for their
enforcement.

A National Labor Supply Board was set up by the Minister consisting of two
representatives appointed by unions and two appointed by employers, with him-
self as chairman. This board was to put into effect regulations of labor supply.
Voluntary methods were still relied upon and only in 1941 came steps toward
greater control of employment, with denial to employers of the right of dismissal
■ except for misconduct. Workers were transferred from nonessential to defense
production, and women released men for production work. Reliance was still

g428 WASHINGTON HEARINGS

placed on voluntary methods, but movement of labor in war industries was
restricted. Dock workers were made Government employees to be allocated to
various jobs.

This brief outline of British experience shows the adaptation to emergency
methods and machinery of the deep-rooted practice of representation and the
instinct for freedom that prevails even in their blackest hour. As a matter of
principle the British still adhere to voluntary methods because they are sound
and just and hence are the surest way to production and national morale. So
labor in the United States, should the national emergency require it, would be
willing to delegate to responsible government agents power to make decisions in
the interests of national safety provided the representative principle was observed
giving each group concerned its day in court.

Our present organization for national defense ignores the principle of repre-
sentation and fails to delegate responsibility definitely. Hence the administra-
tion needs the support of an understanding nation which is necessary for an all-
out effort. When organizations of workers and employers are asked to participate
in national defense by designating their representative to work with the Govern-
ment, they will then be in a position to send information throughout their ranks
that will result in understanding and they will have a responsibility for getting
things done. Out of such a situation will come grim determination to produce the
defense necessary to maintain our free institutions.

Survey by American Federation of Labor Unions of Conditions in Defense

Areas

[Note.— Population figures in some instances apply to the city itself and the surrounding industrial area.
Figures are for the predefense period.)

ALABAMA

Anniston area.

Housing. — Defense program larger in Anniston area than in any other part of
State. If defense program continues to expand, housing facilities must be in-
creased greatly.

Birmingham .

Population. — Normal, 330,000. Defense program brought in 500 soldiers and
1,000 construction workers.

Housing. — Workers paying about 30 percent more rent. Very small increase
in private construction, but have four United States Housing Authority projects.
Situation not acute.

Health. — Have free general clinics, and some State public health service.
State, county, and city health services doing a good job. New workers can get
adequate health service at present.

Childersburg area {Talladega, Childershurg, and Sylacauga).

Have combined population of 7,000 to 8,000, but with powder plant and bag
loading plant getting under way these places do not have sufficient housing
facilities, schools, or churches to take care of workmen on defense jobs. More
houses needed in this area as quickly as they can be erected.

Gadsden.

Population. — About 60,000. About 23,000 soldiers now stationed at Camp
McClellan, about 23 miles from Gadsden. Increase of about 3,500 temporary
workers and about 1,250 permanent residents, with about 5,000 more expected
over the next few months.

Housing. — Housing Authority has built and is building large number of houses,
but this expansion is not sufficient. New workers find it impossible to obtain
decent homes, and are now living in slab huts, trailers, houses without floors,
garages, barns, stables, and old store buildings. Rents for new workers have
gone up about 33 J^ percent. There has been practically no private building;
250 Government-built units are under construction. Report by Roy D. McCord,
attorney for union and member of housing committee: Condition in Gadsden is
appalling. Should be 1,000 new home units in area. Situation should be classed
as emergency. Will be both suffering and disease in area if conditions are not
corrected.

Health. — Have free venereal clinic, but no general. Have a county health
department. Receive same amount help now as before defense program. New
workers cannot get adequate health service. New workers moving into town
have taxed sewage and sanitary facilities of area.

NATIONAL DEFENSE MIGRATION 6429

Schools aiiA recreation facilities. — Have insufficient schools and no recreational
facilities whatsoever.

Price'!. — Within last 2 months all commodities, services, and rents have gone up,
and rents are exorbitant.

Union activity. — Unions have appointed committees to confer with city com-
mission, county board of revenue, and county health office. These committees
have pointed out several insanitary conditions to these boards. Have no repre-
sentative on advisory committee of employment service.

Mobile.

Population of about 60,000. Has been growing rapidly in recent years. Housing
facilities have been able to take care of the situation so far, but more housing will
be needed very shortly.

ARKANSAS

Little Rock area.

During construction at Camp Robinson, near Little Rock, no great shortage of
facilities to care for transient workmen, but housing shortage developed and
rentals increased markedly with advent of soldiers. Many families of soldiers
were forced to return home as the}' were not able to secure suitable houses at
rentals they could afford. To get two new Government defense projects: 1. Det-
onating plant at Jacksonville, about 17 miles from Little Rock — a small town
that cannot take care of the housing situation during construction of the plant; 2.
Picric acid plant near Marche (also near Little Rock). This town also not able
to care for workmen. Three flood-control projects now under construction.
Some workmen driving 40 miles to and from their homes. Others being housed
in tents, trailers, and shacks. Serious shortage will develop with starting of new
projects. North Little Rock has slum-clearing project well under way. Little
Rock has been working 2 years on its slum-clearance project, but contracts not
yet let. Fort Smith had to take their project to the people to put it over. Not
sure when it will start. Pine Bluff turned down a project. Appears that real-
estate interests are either antagonistic, or at least uncooperative in trying to
relieve housing shortage.

CALIFORNIA

San Francisco.

Population.— 750,000.

Housing. — No housing problem, nor increase in rents. Large program of home
building in all parts of the city, including several Work Projects Administration
projects numbering several thousand homes.

Health.— Free general and venereal clinics. State health board campaigning
for tuberculosis and syphilis clinics. No acute health problems; adequate service.

Schools.— No particular problem here.

Prices. — No unusually high prices or rents.

CONNECTICUT

Waterbury.

Population. — Ninety-nine thousand three hundred and fourteen, by 1940
census. About 4,000 permanent workers have been added since beginning of de-
fense program. Year ago citj- employed about 34,750 people, and in May 1941,
empllyed 45,348; increase of 10,598 over the year.

Rents have risen $2 to $5 in some instances for workers homes. From June
1940 to May 1941, 299 permits issued for 1-family dwellings, 6 permits for 2-
family dwellings, and 1 permit for a 6-apartment building. Three hundred Gov-
ernment built homes to be erected.

Health. — Have two free general clinics, and one free venereal clinic. Had
State public health work before defense program. Waterbury Health Council
formed during past year to aid health program. New workers can get adequate
health service.

Prices. — Unusually high prices for eggs, butter, and flour.

Lnion activity. — Asked for slum clearing; no advisory committee to employ-
ment service set up in this city.

FLORIDA

Jacksonville and Starke.

Population. — One hundred seventy-three thousand and si.xty-five (1940 census),
Camp Blanding — about 8 miles from Starke, town of about 1,500, and about 50
miles from Jacksonville (new road not finished when construction work at camp
was going on). Meant IVi-hour trip each way for workers living in Jacksonville.

^430 WASHINGTON HEARINGS

Also naval air station 12 miles frona city; 8,000-10,000 workers employed on con-
struction of air base; started building Camp Blanding when base was about 75
percent completed. This project at one time employed 20,000. At peak of these
projects about 25,000 new workers came in from other localities or traveled from
50 to 100 miles to work. Including soldiers, 60,000 to 70,000 people have become
temporary residents. About 25,000 more or less permanent residents have come
in because of these projects.

Housing. — Workers found it impossible to get adequate homes. Many lived
in their cars, in trailers, covered trucks, hovels made of scraps of metal, building
paper and even palmetto leaves over rude frames. Houses in towns within 75
miles that took roomers were badly overcrowded. Rents increased alarmingly.
One member, by getting there early, found summer cottage 2 miles from camp,
without modern conveniences; ordinarily renting for $20 to $25 a month. He
paid $45 a month, and by April was paying $60. Contractors provided fairly
decent barracks, but were late getting them built, and would accommodate only
about 1,500 workers of 20,000. Private construction considerably above the
average. Building of defense homes with Federal aid, responsible for about 600
family units, is continuing. Housing shortage very acute.

Health. — Have free clinics operated by city, but inadequate to care for increased
demand. City and State boards of health making strenuous efforts to control
disease. Nearest hospitals to Camp Blanding (before Army hospital was ready)
were in towns 40 to 50 miles away. Contractors had first-aid stations, but many
serious accidents occurred on job and on crowded highways, many deaths un-
doubtedly resulting from inadequate facilities.

Prices. — No attempt by anyone to control prices. A meal in Starke doubled
in price without any increase in quantity or quality of food. Later a few restau-
rants opened closer to camp, but prices were higher than one would ordinarily
pay for same food and service in Jacksonville.

Schools and recreational facilities. — Already have acute shortage of school facili-
ties. Trying to remedy situation by securing Federal aid in building of new
schools.

Lnion activity. — Taken part in program to provide better housing. Central
labor union represented on committee to secure better school facilities. Local
teachers union also active. Representatives of all jbuilding-trade unions work
closely with employment service.

Pensacola and Panama City.

A $5,000,000 gunnery school is being erected here; housing shortage is very
acute.

West Palm Beach. -i

Population. — Forty-six thousand. Defense program has brought in 3,000 sol-
diers, 1,000 construction workers, and 500 permanent residents.

Housing. — Possible but difficult to find reasonably priced housing facilities. No
rise in rents. Government building 150 defense units. Situation is not over-
crowded.

Health. — General and venereal clinics available. No State public-health work,
except that now State furnishes serums for use by county and city health units.

Schools and recreation. — Schools are being enlarged, but there is great need for
additional recreational facilities.

GEORGIA

Columbus.

Population. — Normally, 45,000. Defense program has brought in about 42,000
soldiers, 3,000 construction workers, and about 8,000 permanent workers. Fort
Benning, with normal population of 8,000 men, is now expanded to about 50,000,
and 50,000 more are expected within the next 6 months. p]stimated 25 percent
of the soldiers have wives and children, Columbus being the nearest place for
them to live.

Housing. — It is impossible for new workers to find reasonable housing facilities.
Rents have gone up 40 to 150 percent. About 1,000 defense housing units have
been built, and private capital has built about 500 houses in the $3,000 class.
These do not begin to offset the demand. Army billeting office in Columbus esti-
mated property at higher value than working people can afford. People are
having to move into cheap and insanitary homes. United States Housing Authority
made a survey of Columbus and vicinity and found that rents have increased
as much as 145 percent. A representative of Office of Price Administration and
Civilian Supply has established a fair-rent committee in Columbus, but not

NATIONAL DEFENSE MIGRATION 6431

expected to have any weight with the landlords, since it has no authority to
impose any penalties.

Health. — No free clinics. New workers are not able to get adequate health
service. No expansion of hospital facilities known since start of national emer-
gency.

Hinesville.

Population. — 100,000 normally. Since the beginning of the defense program
30,000 soldiers, 1,000 construction workers and 10,000 workers on a more per-
manent basis have come in.

Housing. — New workers find it impossible to get decent homes reasonably.
Some are now living in trailer camps and shacks. Rents have gone up $5 to $15 a
month. There is considerable private construction plus 2 housing projects for
Negroes and 2 for white residents.

Health. — Have a free general clinic. At present there are no particular health
problems needing special attention.

Prices. — General increase of about 10 percent.

Union activity. — Local Trades and Labor Assembly appointed committees,
offering full cooperation with local health authorities and with Board of Educa-
tion. Have no representation on advisory committee to employment service,
and feel that they should have such representation.

Macon.

Population. — Seventy thousand. Sixteen thousand soldiers, 8,000 temporary
workers, and 6,000 permanent workers have been brought into area by defense
program.

Housing. — Still possible to find housing facilities, but in another 3 months it
will be impossible unless more homes are built. People are living in trailers, a
few in tents, and some are sleeping from 2 to 6 in a room. Rents are up 20
to 45 percent. Private capital backed by Federal Housing Authority is
contemplating about 300 homes. Have 2 completed low-rent housing projects
and 2 under construction. It is believed that if proposed plans materialize, hous-
ing situation will be under control.

Health. — Free general clinic. Service adequate, no particular problem unless
it is the possibility of spread of venereal disease.

Schools and recreation. — Schools crowded. Will probably need more recrea-
tional facilities.

Prices. — Rents and food prices rising rapidly.

Savannah.

Population. — Ninety-five thousand nine hundred and ninety-six, 1940 census.
Sixteen thousand soldiers have come into +he area, about 1,000 temporary work-
ers and 1,000 permanent workers. Workers can still find housing facilities, al-
though with some difficulty. Rents have increased about 10 percent in general.
The Government has built 2 colored housing projects, 1 white housing project,
and there is one project under construction for air base men.

Health. — Have 1 general free clinic. Have some State Public Health work, but
no more than before defense program. City's health record is good.

IDAHO

Boise.

Population. — Thirty thousand. Increase due to defense work; 2,500 soldiers,
500 temporary, and 1,000 permanent residents.

Housing. — Rents up about 10 percent. One hundred Government built homes
available for Army officers and their families. Have tried to secure United
States Housing Authority aid.

Health. — No particular health problems, and no lack of schools and recreational
facilities.

Prices. — General living expenses up 15 percent.

ILLINOIS

Rock Island (Tri-Cities area).

Population. — One hundred and fifty thousand, with about 1,500 temporary
and 5,000 permanent residents added by defense program. Many workers are
living in trailer camps and shacks; it is impossible to get decent homes at reason-
able rents. Rent is up 15 to 20 percent. Extensive private construction going
on and about 500 units of Government built homes, but situation is still very
overcrowded.

-41 — pt. 10 9

g432 WASHINGTON HEARINGS

Health. — Free venereal clinic. Has State public health work in community.

Recreational facilities. — Insufficient.

Prices. — General rise in prices.

Union activity.— -Been active in asking for better health and schooling facilities.

INDIANA

Indianapolis.

Population. — Three hundred and eighty-six thousand one hundred and seventy^
with about 20,000 workers of permanent type added by defense work.

Housing. — Rents advanced 5 to 10 percent. Critical shortage of housing facil-
ities, but this is being eliminated by building program carried on by private
interests. One of the heaviest programs in the country.

Health. — City hospital operates free general clinic. No expansion of facilities
since start of defense work. Trailer camps without municipal supervision present
health problem.

Schools and recreation. — Both inadequate to care for increased population.

Prices. — Increases apparently not greater than general for the country.

Union activity. — Not encouraging. School board will not work with labor.

Hammond.

The situation which exists in Hammond is common to all localities in this area.
The Federal census of 1940 disclosed the total of 18,652 dwelling units in the city
of Hammond, of which only 194, or 1 percent were vacant early in 1940. Before
these figures were dry on the printing press, there was not a vacant house to be
rented in Hammond, which condition continues to the present time in still greater
degree. Numerous families are doubled up and are living in trailers within the
city and just outside the city limits, under conditions which cannot be any too
healthful, and certainly are not a suitable place for children. Heavy influx of
families into Hammond area, and it is impossible for incoming families to find a
house in the city. They are finding homes by overcrowding orliving in trailers.
or unoccupied sliacks wherever they can be found. The situation warrants con-
struction of 1,000 new houses in Hammond and environs in addition to several
hundred now being built.

IOWA

Burlington.

Population. — Normal, 27,000. Upward of 20,000 workers of all types have
come in since the defense program (shell-loading plant).

Housing. — City officials state that there was shortage of housing before con-
struction of this plant. Houses normally renting for $25 to $30 a month now
rent for $54 to $65 a month. Rooms in private homes normally $3.50 to $5 for
a single room now bring $10 a week, with two or three small beds or cots in each
room. Government has built barracks on the site of projects which are reasonably
satisfactory, but these do not accommodate any great portion of the workers.
Farmers charging $2 a week for space to park trailers. Trailer camps grown up
in large numbers around site, with sanitary and other living conditions at their
worst. Few new houses being constructed, but rent exorbitant. Transportation
facilities are bad.

Schools. — Adeciuate school facilities next to impossible.

Health. — Doctors and hospitals taxed to limit and working under great handicap.

Prices. — Food and clothing prices have in most instances more than doubled.
Prices in Burlington Atlantic & Pacific stores were advanced from 20 to 70 percent.

Union activity. — Organized labor receiving full and satisfactory cooperation
from employment service. Real-estate operators successfully defeated unions'
eflforts to pass enabling act to permit Federal housing projects in State.

KANSAS

Fort Riley cantonment.

During construction, workers had to drive long distances to and from work.

Parsons.

Population. — Fourteen thousand. Carpenters' union estimates that 4,000 men
will be emploved in the construction work, and after plant is completed (shell-
loading plant," $35,000,000), 6,000 men will be employed there.

Housing. — Rents have gone up 10 percent already. There is some talk of new
houses, but not many are started as yet. No Government housing. There have
never been any great number of vacant houses for rent. Since railroad general
offices and shops are located there, increase in railroad employment will add to
the shortage.

NATIONAL DEFENSE MIGRATION 6433

Health. — Have free general clinic, and some State public health service. Com-
mittee io now being formed to consider health problem. Health service is at
present inadequate. Report from member of Kansas State Board of Health:
"Proper inspection, sewage disposal, and water supply is necessary program for
project."

Schools. — School facilities will be strained. School building program has been
approved in Washington under Work Projests Administration, but if started at
once it will not be finished in time to meet emergency. Suggests speedier program.
In the beginning school facilities will be able to care for 1,400 increase without
great disruption of school program, but even this will cause many inconveniences,
and additional 10 teachers will be needed. No additional revenue can be secured
to meet emergency. Tax levy cannot be increased without special legislation.
Reduces amount of available moneys to be expended for health units, sanitary
engineer, and milli inspection in area.

Wichita.

Population. — One hundred and twenty ^^ thousand. Defense program has
brought in 1,000 workers of temporary nature; 15,000 with permanent jobs;
40,000 expected by spring (conservative estimate).

Housing. — According to machinists, has several airplane factories operating at
capacity under Government contracts, and housing facilities are very inadequate.
Almost impossible for workers coming into the area to find decent, reasonably
priced homes. Situation is bad but is being taken care of as fast as possible.
Government is working on housing project that will care for 400 families, with
1,000 more units being contemplated. Local capital is erecting homes as fast as
possible, with probably about 1,000 new residences built in the past 6 months.
At present, however, there are no houses available, so workers cannot bring their
families with them. All available rooms and basements are rented with 2 to 4
people in every room. Hundreds of basements in the city have from 6 to 12 men
sleeping in them, paying $.5 and $6 for a bed.

Health. — Do not know of any free clinics. Committee just set up to provide for
public-health facilities. New workers can get health service if they can pay for it.

Schools. — Inadequate, but Defense Council is looking into the problem.

Prices. — Outside of rents, prices are still reasonable.

KENTUCKY

Louisville area.

Population. — Five hundred thousand, with increase of 35,000 soldiers, 35,000
construction workers, and about 5,500 production workers.

Housing. — New workers have been living in rooming houses, hotels, tourist
camps, boarding houses; in Charlestown, Ind., also in hotels, tourist camps, trailer
camps, shacks, and boarding houses remodelled from roadhouses. Rents in area
are up about 35 percent. About 2,000 homes are being constructed by Federal
Housing Administration and private enterprise, ranging in price from $3,000 to
$10,000, with an average of about $5,500.

Health. — Has free general and venereal clinics, and apparently fairly adequate
State public health program. Workers who have come into area and cannot get
jobs present a health problem. Apparently no provision has been made as yet
for expanding facilities to take care of these people. State federation requested
improvement in sanitation conditions for Charlestown, Ind., in effort to prevent
epidemic during the summer.

Schools and recreation. — Recreational facilities and churches adequate. Schools
were overcrowded before influx of new workers and their families.

Prices. — Local press has been pointing to rising prices for commodities and
rents.

Union activity. — Unions cooperate with authorities at all times in trying to secure
housing, health, and school facilities.

MASSACHUSETTS

Quincy area.

Population. — Two hundred and fiftj' thousand; 10,000 construction workers and
50,000 workers with more permanent jobs have come into this area since beginning
of the defense program.

Housing. — City of Quincy and surrounding communities woefully lacking in
adequate and reasonable housing facilities to accommodate workers employed in
Fore River shipvards on defense work. Emplovment at these yards has increased
from 9,000 in 1940 to 17,000 by June 1, 1941", and by 1942 'it is expected that
25,000 to 28,000 will be employed there. Rents are up 5 to 10 percent. There

6434 WASHINGTON HEARINGS

is some Federal Housing Administration sponsored building and some private
building, but no Government-built project as yet. Federal housing projects have
been proposed, but the chamber of commerce, the banks, with heavy investments
in real estate, and real-estate interests have managed to block labor efforts to
secure a defense housing development in the city.

Health. — Have free clinic and some State public health work, but there is no
apparent increase since the start of the defense program. Workers are not able
to get adequate health service. Hospitals are taxed to capacity.

Schools and recreational facilities. — Generally inadequate.

Union activity. — Subcommittee on housing has been working with city and
civic leaders to secure defense housing development for Quincy. Have attempted
to get housing authority committee established (in city council), but efforts were
unsuccessful.

MICHIGAN

Battle Creek.

Fort Custer has brought complicated problems of housing and school facilities.
Bay City.

Population. — Normally 75,000. Only about 200 construction workers and 50
permanent families have come in so far.

Housing. — Have not had any defense work to speak of. Nearest defense job
is in Midland where there is a housing shortage. Majority of men on that job
live in Midland, Saginaw, or Bay City. No housing shortage in Bay City,
although a few men live in trailers.

Health. — No free clinics. Have city and county public health program.

Detroit.

Population. — One million five hundred thousand; 2,000 soldiers and 2,000 con-
struction workers plus an unestimated number of production workers.

Housing. — Rents up $10 to $15 a month. There is quite a boom in poorly
built and much overpriced residences. Government has built two large projects,
both already occupied. Overcrowding chiefly in slum areas.

Health. — Have free clinics and some State public health work, although it is
still inadequate. In outlying areas, Warren Township, and Macomb County
sewage-disposal-system, garbage-collection, and other sanitary services are badly
needed.

Schools. — Schools are very overcrowded. All classes are too large; some of
them run in two divisions, morning and afternoon.

Prices. — All foodstuffs and rents unusually high.

Union activity.- — Detroit and Wayne County Federation of Labor has tried for
years in every possible way to improve these conditions. Labor people are
serving on all committees concerned with housing, schools, health, etc., and are
doing a good job of representing working people generally.

Macomb County.

The new Chrysler tank plant in this county brought problems of providing
adequate sanitation, housing, school, and transportation facilities.

Muskegon.

Defense work has led to difficulties in housing and schools. Federal housing
project of 300 units will help situation, but employment there is at all-time peak
and will contiuue to go up. Local community is unable to provide these
facilities without Federal aid.

Pontiac.

Population. — Eighty thousand. Expect 100,000 by fall.

Housing. — Impossible now for workers to find decent homes. Are now living
in trailer camps, lake cottages, and are doubling up with other families. Rents
have gone up $10 a month. About 200 housing units built over past year with
help of Federal Housing Administration. Now have only 17,600 units. Will
need at least 10,000 more by fall.

Health. — No free clinics. Some State health work, but very inadequate. No
free health service for workers.

Schools. — Will be crowded into temporary shacks within a year.

NATIONAL DEFENSE MIGRATION 6435

MISSISSIPPI

State.

Housing. — In some case as many as 15,000 to 20,000 workers have gone to one
defense project, a large number of them living in trailer camps and tents. Rents
are higher than last year.

Health. — Apparently few free clinics in any of the defense communities; probably
inadequate services for increased population.

Schools and recreational facilities. — Very inadequate.

Pascagoula.

Population. — Fifteen thousand, with 3,000 temporary and 4,000 permanent
added by defense program.

Housing. — -Impossible for new workers to find adequate homes. Employees of
Ingalls Shipbuilding Corporation have had to seek homes as far away as Mobile,
Ala. (40 miles). Rents on some homes have gone up from $5 to $35 a month.
There is some private construction and a naval housing project to provide 700
homes. From 3 to 6 people now sleep in one room.

Health. — Have free general clinic. Had some State public-health work before
defense program. Public-health service available to all people of county. Have a
health doctor and two nurses.

Schools. — School facilities just about one-half of what they should be. Class-
rooms are overcrowded, and there are not enough teachers.

Prices. — Rent, groceries, and clothing have all gone up in price.

MISSOURI

Camp Leonard Wood.

At peak, employed 35,000 men. Housing conditions were the worst possible
Located 85 miles from a city of any size; workers lived in all conceivable types of
housing, including pup tents, trucks, and a few rooms in Waynesville, 8 miles
from the camp, where as many as 10 men were crowded into rooms designed to
accommodate 2. Men were compelled to pay four or five times regular rates.
Workers wanting reasonable accommodations for their families sometimes had to
live from 50 to 60 miles from the project. There was no sanitary system in the
vicinity of the camp. It was a miracle that no epidemic broke out. This project
is now nearing completion, but many of the men are now transferring to the
O'Reiley Hospital project at Springfield, where housing conditions are very bad,
with only about 50 vacant houses in the city.

Kansas City.

Two major defense projects, with about 6,000 men employed, the majority of
them living in the area. There is a shortage of residences in the city, and real-
estate men have raised the rents on the few available houses. Have just passed a
housing bill which will permit Kansas City to secure Federal funds for proposed
projects.

St. Louis.

Has 3 major plants under construction, employing about 10,000 men, the major-
ity of which are St. Louis residents. St. Louis and the county have built a large
number of homes during the past year. Three large Federal housing projects
have been started to accommodate 2,000 families.

NEBRASKA

Omaha.

Population. — About 300,000. Only 50 construction workers brought in as yet.
Not much need of outside labor so far, since the slack around there has not yet
been taken up (bomber assembly plant at Fort Crook).

Schools. — By fall, enrollment in elementary schools of Omaha and adjoining
towns will be increased by about 5,330. Schools wiU have facilities for only 2,725
of these.

Union activity. — Have a member on regional defense committee appointed by
the Governor and on the subcommittee of labor and employment.

NEW HAMPSHIRE

State.

There is a terrible shortage of houses. Many workers travel 50 to 60 miles
to work at the navy yard and on housing projects. Some of the houses have no
modern conveniences, and rents are very high. Schools in the cities are good,

g436 WASHINGTON HEARINGS

most of them modern. There may be some overcrowding in defense areas but not

to any great extent.

Manchester.

Population. — Forty-five thousand. Additional, 1,500 soldiers, 1,000 con-
struction workers.

Housing. ^ThQVQ is room for improvement in the housing situation. Houses
are old and have no modern conveniences. Homes in rural districts have no
modern bathrooms, no electric light or gas, and no running water. For a short
time men had to live in trailer camps, but defense work in the area is now com-
pleted. Main problem is high rents, all out of proportion to desirability of house,
location, and facilities provided. No Government housing and little private
building. Overcrowding is not yet the problem so much as decided tendency
toward profiteering.

Health. — No free clinics or first-aid stations near defense projects, and no free
venereal clinics available to working people. Lack of any free hospital service.

Prices. — Rents up as much as 65 to 75 percent. Unusually high prices for
almost all commodities. Actual living costs of production worker are much
higher than in his former community.

Union activity. — Union has no representation on any of the housing, health,
or school committees. Have representation with State employment service.

NEW JERSEY

Elizabeth.

Population. — Two hundred thousand, with 5,000 workers brought in by defense
program. Millions of dollars' worth of contracts let in this area, and when work
gets under way on these there will be need for additional housing.

Housing. — One company will be taking on 1,500 employees, for whom there
will be only 25 houses available. There are two low-rent housing projects in this
area, both fully occupied. Have applied for another United States Housing
Authority project. Rents are up about 10 percent. Private construction has
consisted chiefly of one-family dwellings for sale.

Health. — Have a free general clinic. State public health work has not been
expanded since start of defense work, but new workers can get adequate health
service with existing facilities. No particular health problems.

Schools and recreational facilities.— luadequaie in smaller towns of Union
County.

Union activity. — Representation on health and school boards and on Elizabeth
Housing Authority.

XEW YORK

State.

Report of housing division of State government. — State division of housing instru-
mental in initiating housing vacancy surveys in all of the important industrial
areas of the State. Returns to date, with one exception, show vacancy ratio
below danger line (3 to 5 percent). In Buffalo, Niagara Falls, and North Tona-
wanda conditions of acute shortage indicated, particularly in low-rental range.
Rent increases reported in several cities. Government building: 800 to 900 units
assigned to Buffalo-, about 300 to Niagara Falls, about 200 planned for Elmira.
Housing problem in Oswego due to colored regiment of National Guard stationed
there. Commissioned officers desire apartments in the city for their families.
Homes at reasonable rentals are difl^cult to find. No quarters are available for
housing colored visitors over week ends. Pine Camp in Watertown has thrown
tremendous load on housing accomodations, because most of the officers' families
live in the citv.

Buffalo.

Population. — About 2,500 construction workers have been brought in by the
defense program; 25,000 production workers are expected by January 1942.

Housing. — Men are living in substandard buildings and families are doubling
up. Rent has gone up about 10 percent. About 2,500 privately constructed
homes have been built outside of the city. The new workers wish to live in
the city. Also, wages of defense workers are not high enough for them to buy
or rent homes from private contractors. To date 1,000 housing projects have
been approved for the area — 200 in Lackawanna and 800 in Buffalo. So far,
there are no temporary camps or barracks, but will be soon when plants are in
full production. It is impossible at the present time for new workers to find living
quarters in this area.

Health. — Have free general clinics, and State public health work. Other
health problems will arise if adequate housing facilities are not provided.

NATIONAL DEFENSE MIGRATION 6437

Union activity. — Took matter up with Mr. Palmer last September; telegraphed
President Roosevelt January 8; called situation to the attention of Congressmen
and Senators repeatedly.

Elmira.

Population. — Fifty thousand; about fifty construction workers and 200 perma-
nent workers brought in by defense program.

Housing. — Rents have been increased $6 to $10 a month. Government build-
ing 200 houses. Influx is not yet great enough to cause serious situation, but
defense program has only just started.

Health. — Have free clinics, public health nurse services, preschool and school-
child age clinic. Free city doctors; free dental service and hospitalization.
However, sewage lines near housing projects inadequate.

Union activity. — Took active part in securing housing project.

Schenectady.

Population. — One hundred twenty-five thousand. Defense program has
brought in about 3,000 new workers.

Housing. — About 290 housing units were available in May, half of them of slum
character. Banks decline to finance housing, and there are as yet no Govern-
ment-built homes. A minimum of 1,000 units will be required to take care of
the 5,200 employees to be taken on by General Electric before October. Eight
hundred additional men are to be employed by the American Locomotive Co.
The housing situation will be acute by fall unless 1,000 to 2,000 new units are
constructed by that time. Unions have agitated for State housing project but
realtors bitterly oppose it.

Health. — Free general clinic, but no public health provisions except municipal.
Health conditions are excellent, with no special problems at present.

Schools. — No lack of schools, recreational or church facilities.

Prices. — No higher than remainder of State.

Union activity. — Union cooperates with local authorities, and has representa-
tion on local housing authority.

NORTH CAROLINA

Fayetteville.

Population. — Seventeen thousand four hundred and twenty-eight. Sixty
thousand soldiers brought inco the area, 28,000 construction workers, and 5,000
permanent residents.

Housing. — Workers on construction jobs have lived in trailers, tents, and
shacks. It was impossible for workers to find homes at the peak of construction.
Rents have gone up 100 percent. Very little private construction. Govern-
ment is just finishing defense housing project of 558 units to be used by non-
commissioned officers. Practically everyone turned homes into rooming houses,
with as many as 6 or 8 men in a room. Some could not get any rooms, and had to
travel as much as 160 miles a day to get board and room. Rent is very high, as
someone is always willing to pay a little more in order to get a house.

Health. — No free general clinics. There is some State public health work.

OHIO

Youngstoxon.

Homes and rooms are very scarce. There is one slum clearance project. Tried
to get another but were not successful. Rents are very high.

OKLAHOMA

State.

Two major defense projects are just getting under way in Oklahoma City and
Tulsa. Probably, however, these will not place great strain on the facilities of
these two cities.

Latoton.

Pop^/Za^^V)n.— Normally about 18,000; is now estimated to be about 24,000 and
about 24,000 soldiers at the fort. About 6,000 soldiers have come in, 2,000 tem-
porary workers, and 1,.500 permanent workers.

Housing. — Many workers travel from 10 to 50 miles daily to obtain living
quarters. Will be more acute situation in the near future because of oil boom in
Apache. Many of the workers live in trailers located on residence lots in the
town; also in cheaper rooms and houses on the outskirts of Lawton, but rooms

g438 WASHINGTON HEARINGS

and apartments are hard to get and especially at a price the working man can
afford. Rents are up 40 to 45 percent. Four hundred homes are being con-
structed privately and 150 are being built by the Government for Army personnel.
Anticipated that shortage will become even more acute.

Health. — Have a county health clinic, and have had State public health work
in the community intermittently. The county health clinic is probably overtaxed.
There is a lack of sanitary conveniences for transients.

Prices. — Gasoline is about 3 cents a gallon too high. Taxi fares have been
raised from 10 cents to 15 cents for town trips, and raised about 15 percent for
other trips. AH staple goods have gone up in price.

Schools and recreational facilities. — Schools are about 20 percent deficient, and
recreational facilities about 75 percent below what they ought to be.

Union activity. — Union and employment service cooperate to fullest extent in
matters pertaining to the welfare of the workers.

OREGON

Portland.

Housing. — The situation is not yet acute, but can become serious with increase
in population. More private building is going on than last year.

Health. — Free clinics and State public health work. About $25,000 has been
spent for Portland and Multnowah County. Portland spends about $270,902 for
health work. Workers can now get adequate health service but increase in popu-
lation may bring difficulties. Industrial hygiene activities are not provided for.
Other standard health services may have to be expanded.

Union activity. — Unions are very active in trying to secure better housing,
health service, schools, etc. Have representation on advisory committee to the
employment service.

PENNSYLVANIA

Chester.

Population. — One hundred and fifty thousand (in 6-mile radius). About 600
construction workers have come into the area; no figures available as to number
of permanent residents added to population by defense program.

Housing.- — About 100 families living in trailers. Rents up about 15 percent.
Situation becoming very overcrowded. Have 1 United States Housing Authority
project of 350 family units near completion, but slowed up by a political housing
authority.

Health. — Have free general clinic and public-health work in the community,
but no additional facilities since beginning of defense program. No particular
health problems as yet.

Union activity. — Do not have local advisory committees to employment service,
but secretary of the union is employed at Chester office of Pennsylvania State
Employment Service as supervisor of interviewers.

Harrisburg.

Population. — One hundred and seventy-three thousand, three hundred and
sixty-seven. Defense program has brought increase of 25,000 soldiers and 5,000
construction workers. Some of the men have been living in substandard houses,
and others have been doubling up. Figures compiled by Harrisburg Housing
Authority: Expected increase in workers, 8,000 to 9,500; 435 vacant dwellings
in the city, 40 percent of them substandard; 400 defense homes in Middletown,
and 1,500 rooms.

New Brighton.

Population. — One hundred thousand. Rents up about 10 percent. More
private building than for past 12 years. No defense work in this area. Have
Just started on housing project.

Health. — Apparently no defense activity in this area, and no particular prob-
lems involved.

Philadelphia.

PopuZahon.— Metropolitan Philadelphia, 2,898,644; Philadelphia, 1,931,334.
Conservative estimate of additional workers brought in by defense program,
150,000. Twenty-five thousand families chiefly in low-income brackets will have
to be hou.sed this year at rents between $25 and $35 a month. It is still possible,
but difficult to find decent housing, but Philadelphia is not "in production."
Some families are living in trailer camps. At present, workers are commuting
long distances, and rents are rising. Substandard buildings are being reoccupied
and decent homes are being overcrowded. Workers will soon be forced to pur-

NATIONAL DEFENSE MIGRATION • Q^39

chase homes they cannot afford or will have to go elsewhere to work. Private
construction is estimated at about 6,000 units, and the Government has allocated
funds for 3,400. Estimated that total need for additional family accommoda-
tions equals 28,500 (includes normal increase of 3,500 families). Total supply of
family accommodations, 20,403. Leaves net deficit of 8,100.

Health. — Has free general clinic. State public health service provides treat-
ments for venereal disease and pneumonia; has added no new service since start of
defense program, and naw workers cannot get adequate health service. Prob-
lems of tuberculosis and communicable disease expected to be most serious.
Existing facilities are inadequate even for normal population and lack of municipal
funds makes expansion difficult if not impossible.

Pittshurgh.

Population. — One million, nine hundred thousand; since defense program
started 2,000 construction workers have come into the area; and 30,000 workers
with more or less permanent jobs.

Housing. — Impossible for workers to find decent, reasonably priced homes.
They are living in trailer camps, tents, barracks, shacks, box-cars, and in all
available substandard houses. Rents are up 1 5 to 25 percent. There is no private
construction of homes within the income limits of the workers. Five thousand
Government defense housing units to be built starting July 5. Trailers have been
brought in for steel mill sections.

Health. — Have free clinics. Overcrowding in steel mill areas apt to result in
epidemics of flu and other contagious diseases.

Schools. — Not available near new defense housing projects.

Union activity. — Organized a county-wide housing committee.

RHODE ISLAND

State.

Population. — Seven hundred and thirteen thousand three hundred and forty-six.
About 5,000 construction workers and about 10,000 permanent workers have come
into State since start of defense program.

Housing. — Not impossible to secure housing facilities, but workers on defense
projects have been forced to live in summer cottages because of lack of all-year-
round residences. After September, permanent winter quarters will have to be
found for hundreds of families so located. Rents up about 10 percent for new
residents. Boom in private construction throughout the State and Government
housing projects are being constructed in most of new defense areas.

Health. — Highly organized State program operated by health department.
Workers can easily get adequate health service.

Schools. — Government is arranging for sufficient schools and teachers in most
crowded sections.

SOUTH CAROLINA

Charleston.

Housing. — Has been shortage for several years — become acute during past year.
Thousands of workers and families have moved into vicinity. Houses and
apartments at reasonable prices not to be found. Many families are crowding up
in trailers, tourist cabins, and any place providing measure of shelter. Several
hundred apartments being constructed — will help, but will not by any means
solve problem.

Health. — One of most pressing problems — hospital in navy yard area.

Schools. — Need assistance for schools which are not in condition to care for
expected enrollment increase.

Union activity. — Have been trying to obtain Federal assistance to relieve the
situation. Feel they should get it since condition is caused by defense program,
and much of it will be comparatively short-lived.

Spartanburg.

Population. — One hundred and twenty-seven thousand seven hundred and
thirty-three. In addition, 15,028 soldiers and about 8,000 workers with per-
manent jobs have been brought in because of defense program. Most of the
temporary workers have left.

Housing. — For people moving into the area rents have gone up 40 to 75 percent,
while people remaining settled have had rents increased about 10 percent. A large
number of privately constructed new homes are going up. Two hundred and
seventy units of Government-built homes for low-income groups have just been
completed, and 125 units for Army personnel will be ready soon. Homes are

g440 WASHINGTON HEARINGS

overcrowded, and substandard buildings are being used. In a few instances rents
have doubled, although this is the exception.

Health.- — Free general clinic. County health department has increased its
personnel since the start of defense work. Does not consider that problem has
increased since defense program.

Schools and recreational facilities. — High school is overcrowded, recreational
buildings are inadequate.

Prices. — Not up more than the general trend.

Union activity. — Unions are cooperative. They took the initiative in securing
low-rent Federal housing projects.

TENNESSEE

Memphis.

There is little defense work in or near Memphis, and adequate housing facilities
for any increase they are likely to have. In Milan (near Wolf Creek ordnance
plant), the situation is more serious. One enterprising gentleman bought aban-
doned streetcars in Nashville, and brought them near Milan to rent to workers in
the plant. Houses with proper sanitary facilities should be put up for the protec-
tion of these workers and of the community as a whole.
Nashville.

Population.- — Two hundred and fifty-seven thousand. About 2,000 permanent
workers brought in by the defense program.

Housing. — Workers required to share living facilities with other families. Rents
have risen $2.. 50 to $5. About 700 Federal Housing Administration financed
homes are under construction to rent from $30 to $45, plus 300 Lanham Act
homes and 180 defense homes. There are now trailer camps for 3.50 and dormi-
tories for 200 persons. The present program is expected to provide adequate
housing.

Health. — Have free clinics and State public health service. New workers are
able to get adequate health service.

Schools. — Davidson County needs assistance in providing additional grammar-
school facilities, and Nashville itself needs help in providing adequate high-school
facilities.

Tullahoma.

Population.— About 30,000 soldiers have been added to the population of the
area since the beginning of defense program; and 12,000 to 15,000 construction
workers have come in.

Housing. — Impossible for these workers to find decent homes. Some have
been living in boxcars, barns, churches, tents, shacks, while others have slept in
the streets. New workers have had to pay three or four times as much as was
normally charged for accommodations. Little private building and no Gov-
ernment housing project.

Health. — No free clinics. Some State public health work in Chattanooga
(over 50 miles away). Now have combined city-county health unit in Chat-
tanooga. New workers cannot get adequate health service.

Prices. — Everything has risen.

Union activity.— Central body working closely behind authorities for action on
housing, health services, etc. Have no representation on the advisory committee
to the employment service.

TEXAS

State.

Housing. — Housing is fairly satisfactory in some areas; El Paso and San An-
tonio had little difficulty in securing living quarters for workers. But difficulty
was experienced in Abilene, Mineral Wells, Palacios, Freeport, Orange, and many
other points. Workers have been forced to accept any available accommo-
dations; have in many instances been unable to secure anything and have slept
in the open without any shelter or any sanitary conveniences. Some have had
to commute as much as 60 to 70 miles to work. Outrageous rates charged in
Brownwood and Corpus Christi for sleeping accommodations. Houses ordi-
narily renting for $20 a month now rent for $60. Workers have paid as high as
$60 a month to sleep two in a bed (Brownwood area). Complaints from Abilene
and Mineral Wells that men are being charged $3 a day to sleep on a cot in a
tar-paper shack. Considerable private construction near defense projects, par-
ticularly near large cities. Few Government housing projects at Grand Saline,
San Antonio, and El Paso.

Health. — Free clinics, both general and venereal, operated in connection with
State health service in all large communities. Very little, if any, however, in

NATIONAL DEFENSE MIGRATION g441

rural areas. State health department has been granted additional appropria-
tions for this work. Workers can get adequate health services if they can pay
for it. Have been informed that department of industrial hygiene, supported
in the main by Federal Government, is to be curtailed in Texas. Would be very
detrimental to the people of the State. Urge that program should be extended,
or at least maintained at present standard. There have been special problems
in connection with defense projects including adequate supply of drinking water
and decent sanitary facilities.

Schools. — Have had little difficulty here as yet, since during construction pro-
gram most workers left their families at home. But it is becoming increasingly
acute. Additional funds have been allocated to extend facilities where necessary.

Prices. — Prices of commodities, services, and rents exorbitant where defense
projects were placed near small communities. Larger cities have absorbed addi-
tional population without any serious rise in price schedules.

Union activity. — Have local housing committees cooperating with housing au-
thorities; also have representation on most housing boards. Have been successful
in passing legislation permitting counties in sparsely populated areas to sponsor
housing programs. Too new to show concrete results as yet. Building trade
unions have been most active. Do not have advisory committee to State employ-
ment service. But State administrator and offices throughout State cooperate
wholeheartedly with organized labor — render excellent and friendly service.

Corpus Christi.

Population. — Ninety-six thousand normally. Seven thousand additional tem-
porary workers and 20,000 with permanent jobs have come in to work on defense
projects.

Housing. — Impossible for these men to find decent homes. Living in tourist
camps, trailer camps, tents, shacks, and automobiles. Rents have gone up 75 to
200 percent. There is some private construction, but not enough, and some
Government defense housing.

Health. — One free general clinic. State public health work insufficient.

UTAH

Salt Lake City.

Population. — Two hundred thousand. Eight thousand men on temporary basis
and 8,000 permanently. Ten thousand soldiers. Difficult to secure decent
homes; some men live in trailers and camps. Rent up 15 percent. Free general
clinic. Inadequate service, but general health conditions good.

VIRGINIA

Portsi7wuth.

Population. — Fifty thousand. About 25,000 more brought in by defense pro-
gram.

Housing. — Good housing facilities difficult to obtain. Four Government hous-
ing projects of about 1,000 units have helped the situation some, but rents in one
of these are too high compared with private and real-estate rentals. New workers
have to pay at least 15 percent higher rent (conservative estimate). Private
home construction has continued at rapid pace. Defense workers have been able
to pay small down payment and build tlieir own homes as cheaply as they could
rent.

Health. — -Have no free clinics nor any State public health service. Workers
not able to get adequate health service.

Schools. — Badly crowded.

Prices. — Material increase in commodity prices and rents.

Union activity. — Officers and members of central labor union frequently appear
before the city council in effort to improve living conditions. Have no representa-
tion on advisory committee to Employment Service.

Radford.^

Population. — Has been doubled by defense program.

Housing. — Very bad housing shortage. Workers have to live in tents, trailers,
and shacks, or travel miles to work (3,000 to 4,000 of them live in Roanoke, 50
miles away). Rent has doubled, and prices have gone up so high that many
workers have quit their jobs and gone home. One worker had to pay $65 for 2
rooms over an old storehouse. Condition is somewhat better, but there is a real
job to do here before winter. Workers are "living like hogs." Some private
building in area, but rents too high for workers.

1 Information submitted by Roanoke central body.

04:4:2 WASHINGTON HEARINGS

Prices. — Have gone up so high in the area that wage increases have not bene-
fited the workers.

Williainsburg and Fort Monroe area.

Population. — Fifty thousand. Brought in by defense program: At Regular
Army posts, 25,000; construction workers, 15,000; permanent, 3,000. Has been
an increase of 30 to 50 percent in rents. About 1,000 small homes have been
built in this area. Rents are too high for the average worker.

Health. — Have no free clinics and very little State health work. Health prob-
lems arise from lack of sanitary sewage system.

Schools. — Not prepared to care for more pupils.

Prices. — Rents and commodities very high.

WASHINGTON

Bremerton.

Population. — Thirty thousand. Ten thousand temporary and 2,000 new per-
manent workers. Rents are up 75 percent. Although there is an enormous
increase in building, people are compelled to live in trailers, made-over garages,
and anything that has a roof. Government-built homes include about 1,500
units, and single men's dormitories.

Health. — No free clinics. No State public health work, except State health
representatives for restaurant inspection work.

Schools and recreational facilities.— Acute shortage of schools and recreational
facilities. School board has made application for Federal and State funds.

Prices. — Living expenses increased tremendously.

Tacoma.

Population. — One hundred and fifty-six thousand before defense program;
now have 45,000 soldiers at Fort Lewis and McChord Field; were about 4,000
building tradesmen employed during construction of these 2 camps. Estimated
that defense program has brought at least 10,000 fairly permanent residents,
many employed in new shipyards. At start of defense program in this area,
thousands of workers came in from all parts of the country because of publicity
overstating number of workers needed.

Housing. — While construction work was under way it was impossible for workers
to find decent homes, and it is still difficult. During construction program
workers lived in trailer camps, tents, shacks, etc. It is estimated that rents
have risen 14 percent for the average worker's home. Been steady increase in
building permits since first of year; 106 issued for June. Housing committee
considering million-dollar program — not yet adopted.

Health. — City conducts a free general clinic. Have no State public health
work, but workers are able to get adequate health service.

Schools. — Some lack of primary and secondary schools and of recreational
facilities.

Union activity. — Unions have been active in demanding better health service,
housing and school facilities. Have members working on committees con-
nected with these matters.

WEST VIRGINIA

Charleston.

Population.- — One hundred thousand normally. Defense program has attracted
5,000 construction workers and 10,000 permanent residents.

Housing. — Lnpossible to get homes at reasonable rent. Three and four families
live together because of 30-percent increase in rents. Private construction —
jerry-built real-estate developments; 450 units built by Navy Department for
naval ordnance plant.

Health. — Free venereal clinic. General health provisions are very inadequate.
Hospitals are overcrowded. Overcrowding of schools presents health hazard.
Most serious problem is lack of uniform pasteurization laws; inspection is inade-
quate, and an epidemic may be expected.

Schools and recreational facilities. — Almost no recreational facilities and schools
are overcrowded.

Prices. — Prices of food and rent rising rapidly.

WISCONSIN

Manitowoc.

Population. — Forty-five thousand. Defense program has brought in 350 con-
struction workers, and more are coming in.

Housing. — People living in trailer camps, but new city ordinances are forbidding
this. Rents up 20 percent. Since January 1, 1941, 60 permits issued for private

NATIONAL DEFENSE MIGRATION 6443

constructiou. There is a Government project of 400 units. There is no shortage
of houses, but a real shortage of houses at a suitable rent.

Health. — Have free general clinics. No additional State public-health service
since defense program started. No pressing health problems as yet.

Schools. — May be shortage of school facilities.

Union activity. — Unions have taken active part in securing housing facilities.
Are working 100 percent with Federal authorities on the 400-home project.

SUPPLEMENTARY STATEMENT BY WILLIAM GREEN PRESIDENT,
AMERICAN FEDERATION OF LABOR

Initiation Fees

Sensational headlines heralding discoveries made by newspaper reporters, of
exorbitant fees collected by unions on defense projects, have given currency to
many outright falsehoods and deliberate misrepresentations of existing practices.

On several projects where all dealings with unions were solely in the hands of
the contractors the reporter assigned to cover the story would base it entirely
on an interview with the officer in charge, whose knowledge of the situation had
been acquired only at second or third hand. No attempt to verify the true factS'
by checking them with the contractor or with union officers was made in many-
such situations.

As a result, a few isolated cases of improper practices on the part of business
agents have been misrepresented as typical, widespread, and continuing practices.
As a matter of fact there were a few exceptional instances of either mismanage-
ment of the union affairs or ill-advised, or, in two or three instances, dishonest
administration of local union policies.

Similar misrepresentations have been spread on public records and given wide
publicity by the testimony of men who seized upon national defense as their oppor-
tunity to attack all unions. These charges are false and must not be allowed to
stand. The full record of union policies on the defense program proves them to
be the product of organized slander and falsification which is a part of a concerted
attack upon organized labor.

What is the record? What are the facts? Why are initiation fees charged
by unions and dues collected by them? What are the services performed_by
unions for their members and how are these services financed?

Benefits

It is the purpose of the American Federation of Labor unions to unite the wage
earners into trade and labor unions in order to protect and advance their wage
and working conditions and to secure for them the recognition and maintenance
of the rights to which they are entitled. The standards established in American
industry reflect what the organized labor movement in America has accomplished
over a period of several generations.

The individual workers through the local union, and individual local unions
through their national organization can achieve what neither the individual local
nor the individual worker can do alone. Organization of other workers in the
same trade or occupation results in the improvement of standards in the unor-
ganized portions of the trade and industry and adds to the collective bargaining
strength of each worker and each group of workers. By joining the union each
worker assumes the willingness and the responsibility for furthering the work and
the cause of his union, his national organization, and of the entire labor move-
ment. That contribution he must make by the payment of his initiation fee
upon induction into his union and through the payment of monthly dues.

A new member entering trade-union ranks becomes a beneficiary of the many
gains already secured and established by his union over a period of years. He
becomes a part in the continuity ol that heritage of which his union organization
is a guardian. The pajanent of the initiation fee thus represents the new worker's
contribution toward that sum total of struggle, endeavor, and service which makes
it possible for him to enjoy automatically the benefits of short hours, better
wages, and improved working conditions.

AN INVESTMENT IN ECONOMIC SECUKITY

In addition to all these things the initiation fee and the monthly dues paid by
the new member represent an investment by him not only in the economic secu-
rity which is given greater assurance by the united strength of his fellow workers,
but also in the security which he derives from the benefits which he will receive

g444 WASHINGTON HEARINGS

from his imiou in case of sickness, unemployment, or disability, and which his
family will receive in case of his death. This very important aspect of the initia-
tion fees has been completely ignored by those who have sought to focus public
attention through the public press on their own ignorance and destructive criti-
cisms ot organized labor.

In the past 14 years the reported benefits paid by national and international
unions of the American Federation of Labor amounted to $450,000,000. This
sum does not include benefits paid out by local unions in organizations in which
benefit funds are administered solely on a local basis. Had these benefits been
included the total amount paid out by the American Federation of Labor unions
during this period of economic instability would have approached a billion dollars.

One of the l)asic purposes of self-organization of workers into unions within the
ranks of the American Federation of Labor is to provide these workers with some
measure of economic security. The hazards of sickness, disability, unemploy-
ment, and old age are the hazards which the workers could better meet by pooling
their resources in order to maintain benefit payments. In the course of the last
depression the American Federation of Labor unions through their resources were
able to make an enormous contribution to its members in their fight against
economic insecurity, agamst privation, and often utter destitution.

BACKGROUND OF SOCIAL-SBCT7RITT LEGISLATION

The long depression such as we have had has fully demonstrated that protection
against economic hazards cannot be sustained by the labor movement alone.
The economic risk is one which must be shouldered by employers and by the entire
community. Labor, therefore, sought and achieved the enactment of social-
security legislation which has made possible a measure of protection by the com-
munity, of the workers' welfare against insecurity. But to the extent that the
social-security program does not fully meet the needs of workers and their families
for protection against economic dislocation and against hazards of sickness, old
age, and death, the labor movement has a continuing responsibiUty toward the
wage earners which it cannot forego.

Additional benefit payments provided by local unions are especially important.
Their importance hes in the fact that almost without exception local unions which
charge higher initiation fees and higher monthly dues than the average do so
because these assessments make it possible for the local to provide larger benefits
and render greater service to each member.

BENEFITS TO TRANSIT WORKERS IN CHICAGO

Let me give you an illustration. In Chicago, union streetcar men, bus drivers,
conductors, and other members of the Amalgamated Association of Street,
Electric Railwav, and Motor Coach Employees received during 1940 a total of
$287,121.08. This represents the payment of disability, old age, and funeral
benefits out of the international as well as local funds. To take a typical example:
John Haadley, a member of Division 241, received $800 in old-age benefits in
1940; $600 was paid by the international and $200 by the local.

In the case of death" benefits, the international pays $800 and the local $200, so
that the family receives $1,000 from the union. In this case local benefits are
smaller than those paid by the international. In other instances the locals shoul-
der the major burden of benefit payment. In the prmting trades, for example,
the International Stereotypers and Electrotypers Union of North America paid
in 1939, $298,316 in unemployment benefits which were handled by local unions
only. The union also paid death, sickness, disabiUty, old-age, and other benefits
which totaled $455,591 in that year.

The International Photo-Engravers Union of North America paid nearly a
million dollars in unemployment benefits and its total benefits paid in one year
amounted to $1,259,000.

A. F. OF L. Unions' Policies on Initiation Fees in Defense Work

With the rapid increase of defense activity the rate of reemployment of workers
on defense production and defense construction was greatly accelerated. These
developments have created new problems of administration within the ranks of
the trade-union movement.

As a general rule, national and international unions of the American Federa-
tion of Labor make in their constitutions specific provision governing the rate of
contribution by local unions to the international which is necessary to sustain

NATIONAL DEFENSE MIGRATION 6445

the operating expenses and benefit payments of the international. Exact amounts
of initiation fees and of monthly dues are determined by local unions themselves.
In some instances the prevailing practices of local unions represent arrangements
established a number of years ago which have remained unchanged during the
recent years of depression and unemployment.

The nature of defense work, its temporary character, and the economic status
of the unemployed nonunion worker seeking defense employment have created a
need for modification and revision of these policies in a number of instances.

MISINFORMATION AND ATTACKS

An impression has been created that all workers securing employment on projects
•operating under union contracts have to pay initiation fees. As a matter of fact,
if the project is operated under a union agreement that in itself necessarily means
that those employed on the project are almost entirely workers who are already
union members. These workers as a rule are either members in good standing,
or inactive members who carry an "unemployed" card which is issued in evidence
of their continued membership and eligibility for employment on work done by
union agreements.

Attacks upon labor alleging assessment of high initiation fees have been
directed mostly at unions in the building and construction trades. Almost
without exception they were directed at classes of workers who are highly skilled
building mechanics in the trades almost completely unionized by the American
Federation of Labor.

Anyone even superficially familiar with labor in the building and construction
industry knows that these skilled mechanics have to serve an extended period of
training and apprenticeship in order to develop the skill and acquire their status
•of eligibility for employment on defense work. The often-repeated story of
thousands upon thousands of unemployed workers who emerge from nowhere as
full-fledged skilled tradesmen seeking jobs on union projects is pure fantasy.
Almost without exception the initiation fee requirements have been fulfilled by
building tradesmen while they served the apprenticesliip in their trade, and the
initiation fee has been paid by them over a period of several years.

There have been cases of nonunion workers applying for work on projects
covered by union agreements who have no union status and seek to become, or
are required to become, union members. The number of workers in this category
is obviously small. But the building and construction unions have appreciated
the necessity of making special arrangements to develop a fair and equitable
pohcy toward this class of workers.

CIRCULAR LETTER OUTLINING POLICY

Let me cite a few examples of what the national and international unions in
building trades have done to achieve this end. On December 5, 1940, the Inter-
national Hod Carriers', Building and Common Laborers' Union of America, as a
result of the action of the executive board, addressed a circular letter to all officers
and members of its local unions. This letter informed the locals that the general
president had been invested with emergency powers to deal with any local situa-
tion threatening to hamper or retard defense projects. President Joseph V.
Moreschi stated the policj- of the international union with respect to initiation
fees in the following terms:

"One of the outstanding matters on which I will act in accordance with this
resolution is the question of initiation fees. Numerous stories have appeared in
the press charging that local unions affiliated with this international union have
levied exorbitant initiation fees and excessive down payments against workers
seeking membership in the union in order to qualify for jobs on defense projects.

"I believe these reports have been greath' exaggerated, but in any case, we
regard such action by local unions as an unwarranted abuse. We will not
tolerate it.

"Under the powers now vested in me by the executive board, I will issue orders
that no prohibitive initiation fees will be permitted and that no excessive down
payments can be exacted.

"Because of varied local conditions and differences in pay rates, it is impossible
and impractical to set a fixed initiation fee on a Nation-wide basis. The ceiling
will be based on local wage rates and conditions. In all instances it is my inten-
tion to issue orders that no man desiring-to join the union where jobs are available
should be required to pay an initiation fee higher than $25 and then only when
his earnings are at a rate of more than 80 cents an hour. The fee will scale down

g446 WASHINGTON HEARINGS

to as low as $2 in some instances where pay rates are lower. In this connection,
I wish to point out that the minimum initiation fee hitherto provided for in the
laws of the international union was $5 and the maximum $50.

"Furthermore, I will provide that a man joining the union will be permitted
to pay his initiation fee out of earnings, so that no hardship will be imposed on
workers taken off relief rolls who may not be in a position to produce the money in
advance.

"I have emphasized the matter of initiation fees because most of the criticism
directed against the union in the press has harped on this theme. I wish to
point out, however, that I am empowered to act in 'all instances of unreason-
ableness, abuse, or restraint on the part of any member of affiliated local union'
in the defense program and I hereby serve notice that I intend to exercise these
powers to the fullest so that we can give the Government every help and coopera-
tion in the defense program.

"Your local union, its officers and members are therefore hereby officially ad-
vised, in all their actions, to conform, comply, and be guided by the above state-
ments in order that the individual, nptional, and mutual welfare of all may be
best preserved, protected ard promoted."

President Moreschi was empowered by his executive board with "full authority
to take such action as may be necessary" in the event of noncompliance, "in order
that the welfare and interest of the membership of this international and the people
of the United States of America as a whole might be protected and preserved."

RESOLtTTION OF TEAMSTERS ON REASONABLE DUES

Another example of such action is the resolution adopted by the general execu-
tive board, on January 30, 1941, by the International Brotherhood of Teamsters,
Chauffeurs, Warehousemen, and Helpers of America. The declaration unani-
mously approved by the general executive board of this international was as
follows:

"Because of the fact that considerable adverse publicity has been given to the
trade-union movement by certain governmental agencies, newspaper columnists,
and magazine writers, and because of this certain contemplated legislation may be
enacted regulating the affairs of labor unions relative to fees charged by local
unions, which action would be seriously detrimental to the interests of the labor
movement; and

"Because of the fact that great stress has been placed by the above-named
publicity agencies on these matters, which has created considerable agitation
amongst the legislators in State and Nation;

"It is declared opinion and expression of the general executive board of the
International Brotherhood of Teamsters, Chauffeurs, Warehousemen, and Helpers
that dues of organizations should be reasonable, and that initiation fees should
be held down as much as possible, so that adverse, harmful charges will not be
directed against the International Brotherhood of Teamsters.

"It is our opinion that wherever possible the initiation fee should be limited
to $25 but under no circumstances should it exceed $50; that arrangements should
be made for payment of same by installments where necessary by those coming
into our organization; and that where local unions have sick, death, and unemploy-
ment benefits attached, these benefits should be arranged to meet any reduction
in revenue obtaining as a result of putting into practice the above requirements.

"It is further stated by the general executive board that while the international
constitution places no limit on dues if they are within reason, except that the
constitution requires that the minimum dues shall be $2 per month, it should also
be understood that where monthly dues are unreasonable or extortionate the
general executive board has the power, contained in the constitution, to take over
the affairs of such local unions if they continue to insist on charging dues or
initiation fees which are beyond reason.

"The above declaration is made with the hope that our local unions will avail
themselves of the suggestions contained herein, rather than compel the interna-
tional union, because of public agitation, to exercise its power under the consti-
tution and regulate or discipline local unions acting directly contrary to the pur-
pose and spirit of this declaration."

STATEMENT BY RIVERS ON DEFENSE POLICY

These resolutions, declarations, and actions do not represent isolated instances
of enfightened policy by individual building-trades unions. They represent the
purpose and considered judgment of national and international unions of the
American Federation of Labor in the building and construction trades. The evi-

NATIONAL DEFENSE MIGRATION g447

dence of this is the resolutions adopted by the building and construction trades
department on March 31, 1941. In making these resolutions public, Secretary-
Treasurer Rivers issued a statement on behalf of 1,500,000 members of the
A. F. of L. building-trades unions, assuring the Government and the American
people that these unions will do everything within their power to build the
strongest possible national defense and to formulate policy and practices neces-
sary to achieve that job. I quote from the statement:

"As evidence of their good faith and determination to cooperate in the national-
defense program, the members of the executive council of the building and con-
struction trades department of the American Federation of Labor, meeting in
special session, have taken constructive action on two important problems, as
follows :

"1. They have solemnly pledged that there will not be any stoppage of work
on account of jurisdictional disputes between any of the building and construction
trades unions on any building or construction project essential to speedy comple-
tion of the national-defense program.

"2. They have agreed that when the unions are unable to supply a full force
of building tradesmen to contractors on defense projects who are recognized as
being fair to organized labor —

"(a) The contractor may employ nonunion men until such time as the various
unions can replace them with members of their own organizations.

"(b) No permit or privilege moneys shall be collected from these nonunion
men by the unions where such conditions exist.

"(c) No initiation fees or other union obligations shall be collected from these
nonunion men except where they can qualify for membership and have been
requested to join the appropriate union and have been accepted into membership.

"(d) When such applications for membership are received, initiation fees shall
be the minimum possible in view of the benefits extended by the union organiza-
tions and reasonable time will be granted for the paj'ment of such initiation fees."

I have cited these resolutions and declarations as evidence of actual operating
policies of the American Federation of Labor unions with respect to workers
employed on defense projects. These policies are not empty gestures. They
have been applied and put in effect. Every single situation in which improper
practices were attempted by local officials has been investigated and corrected.
There can be no more conclusive evidence of labor's ability to exercise self-
discipline in a democratic way without outside intervention, control, and regi-
mentation.

Policies and Problems of Various Unions

I believe it is important for your committee to gain complete understanding
of practical application of standard union policies with regard to intiation fees.
With this in mind I will discuss these policies and the problems underlying them
in the case of several specific national and international unions in different trades
and occupations.

painters

The Brotherhood of Painters, Decorators, and Paperhangers of America is a
national union affiliated with the American Federation of Labor which functions
under its own constitution and enjoys democratic rights of self-government
common to A. F. of L. unions.

The national constitution of the Brotherhood of Painters requires that new
members who join local unions should pay an initiation fee of not less than $5
and monthly dues of not less than $1.50. Of the $5 initiation fee, $2 is payable
to the national, and of the monthly dues a per capita tax of 60 cents per member
is also transmitted to the national treasury.

The constitution establishes no restriction upon the local unions as to the
amount to be charged in initiation fees and lays down no specific requirements
in this respect. However, while the initiation fees charged by individual local
unions differ substantially from one locality to another, the minimum initiation
fee of $5 is charged by a major portion of local unions.

The range of initiation fees charged by locals of the Brotherhood of Painters
extends from $5 to $100 and in some few instances a fee of $150 is prescribed by
the local union. Every one of those fees has been established over a period of
many years and does not represent a departure from the customary practice.

In the localities in which there are large defense projects new local unions have
been formed and as a rule the initiation fee of $5 has been set by these new locals
affording everyone an opportunity to become union members in these defense areas.
60.396 — 41— pt. 16 10

^448 WASHINGTON HEARINGS

In some instances newly established local unions, after the expiration of 30 or
60 days of continuous employment have increased the initiation fees to $10 and
to $25 in a few cases, to bring the initiation charges in line with the long-established
practice of the union in the community.

The Brotherhood of Painters is a labor organization of long-established standing.
Today it represents a membership of some 150,000 workers whose experience,
training, and skill establish the highest standards of the trade in America.

The membership of this great national union has fluctuated with the wide
fluctuations which have taken place in the building and construction industry.
These fluctuations in employment resulting from the successive rises and falls in
the business cycle have fundamentally affected the economic status of all workers
in this trade. Over a period of years wage standards, safety requirements,
and other working conditions have been gradually established to improve the
economic security of the workers and to protect his welfare through union organ-
ization. A new applicant for membership in a local union, by his joining the union,
instantly becomes a beneficiary of work and wage standards and labor j^ractices
which it had taken the Brotherhood of Painters generations to establish. Thus
the initiation fee charged the new member represents in part his contribution
toward the cost of the service in the interest of the trade that the Brotherhood
has carried on for years and is continuing at the present time. Had there been
no organization the disastrous force of unemployment such as characterized the
industry in many periods, notably at the trough of the depression at the end of
1932, the wage structure in the trade would have completely collapsed and the
standards of hours of work, of wages, and safety conditions would have been
greatly impaired. It was through the joint activity of all members of the trade
made possible by the brotherhood that the wage structure could be preserved,
improvement in working conditions attained, and some measure of economic
security in the trade achieved.

BENEFITS TO PAINTERS

The initiation fees and monthly dues represent, in addition, a direct service to
the membership provided by the national organization and by individual locals.
The national union pays death and disability benefits to all members who are less
than 50 years old at the time of their initiation. These death and disability
benefits range from $50 to $400 to each member. The national union also pays
benefits to each member in case of wife's death. Any member whose member-
ship has extended from 1 and up to 2 years is paid $25 upon his wife's death, and
those whose membership is of more than 2 years' standing, $50.

During 1939 the Brotherhood of Painters paid out $312,814 in death and dis-
ability benefits to its members. In 1938, $289,500 was paid in such benefits
and, in 1937, the amount paid out was $278,000. During 1940, benefits of more
than $325,000 are reported to have also been paid out. In the 4-year period of
1937-40 more than $1,300,000 was paid out in death and disability benefits by
the national alone.

In addition, many local unions have made provision for the payment of sickness
and other benefits which enable the members to meet the hazards of unemploy-
ment with the backing of the economic strength of their organization.

Because in a few instances exceptionally high initiation fees ranging from $50
to $100 have been in effect, these fees have been misrepresented as being typical
of the advantage taken by the entire union of the defense program. The fact, is
of course, that the major portion of the workers employed on defense projects
were already union members ot long standing and had to pay no initiation fees
to secure employment on defense work under union agreements. Where high
initiation tees were charged these fees represented an established practice and were
not newly created as a device to take advantage of defense activity. As has
already been pointed out, on the vast majority oi defense projects initiation fees
of $5 have prevailed and in localities where continuous employment was assured
in the future, such fees have ranged from $10 to $25.

High initiation fees established by some locals have uniformly been the result
of mass unemployment and a device resorted to by the local union with large
unemployed rolls to prevent addition of more unemployed workers to its member-
ship.

Once an initiation fee is paid and a member continues in good standing in his
local union he is entitled to receive a clearance card or a transfer card which en-
ables him to transfer to another local union if work becomes available in another
locality. The charge, therefore, that initiation fees have been paid more than once
is utterly untrue.

NATIONAL DEFENSE MIGRATION 6449

In connection with rapid expansion of construction worli in Fort Bel voir, Va.,
in Fredericksburg, Va., in Washington, D. C, and in other localities in the same
area, some confusion arose as to availability of union members for immediate
employment, between the representatives of the Washington and the Alexandria
locals. In connection with Fort Belvoir 34 new members were accepted by the
Alexandria local and charged an initiation fee of $56 each. This was done in
violation of instructions the business agent in Alexandria had received from the
national and was quickly brought to the attention ot the national and ot the War
Department. The case of these 34 men was exaggerated and elaborated, creating
the impression that such was the common practice. The union was widely
criticized in the press for failure to cooperate with the defense program and for
exacting unreasonable returns from the newly initiated members. The case was
quickly investigated, however, and the attitude of the national organization to-
ward the whole problem is best summarized by quoting from the letter addressed
by William J. Gallagher, national representative of the brotherhood, to the War
Department on January 14:

"As a representative of the national organization, representing the general
president in Washington, I will not tolerate any men being compelled to pay for
a job. If we cannot supply men enough for any job we will permit nonmembers
of our organization to go to work at no cost to them. We are not going to permit
any. men to be 'shook down' for these fees for the privilege of working."

GLAZIERS

Another charge given widespread publicity alleged that glaziers on defense
projects were forced to pay initiation fees of $1,500 to enable them to become
union members. Allegations about such fees being charged in Chicago and about
the issuance of work permits for which a daily payment was required but not
applied toward the initiation fee, have been made before congressional com-
mittees, played up by the newspapers, and widely discussed by certain columnists.

it was stated that on the Fort Riley project in Kansas, exorbitant initiation
fees were charged and that work permits were given to new workers, the payment
for which was not applied to initiation. Mr. L. P. Lindelof, general president of
the brotherhood, informs me that this statement is wholly untrue and that every
one of the workers employed on the project had been a union member before he
was employed on the project and had carried a paid up card from a local union in
;St. Louis, Kansas City, or the surrounding territory.

A similar charge was made with respect to Detroit, Mich. The investigation
made by the brotherhood shows that Glaziers' Local Union No. 357 supplied all
union members for every one of the Government projects in that city, with the
■exception of nine men who applied for membership and were employed on one of
these projects. The new members were asked to pay the initiation fee within 90
days. Some men paid as low as $1 per day, some at the rate of $2 per day, and
some $3 per day. The arrangement maintained by the union was that if the
employment of new members terminated before their full initiation fee was paid,
the payments made toward it would be credited to their name so that when addi-
tional work would become available the men when employed would pay the bal-
ance of the initiation fee.

Much has also been said about the $1,500 initiation fee allegedly charged by
Local Union No. 27 in Chicago. No such fee has ever been paid by anyone in
•Chicago or elsewhere to any local union of glaziers. In 1927 and 1928 Chicago
was riding the crest, of a great building boom. At the beginning of the boom the
local's initiation fee was $100 and its membership comprised 350 men. As one
building after another was put under construction glaziers and workers claiming
to be glaziers flocked to Chicago from all parts of the country. The union mem-
bership was growing by leaps and bounds and a list of applicants for mem-
bership was continuously increasing. The union then advanced the initiation
fee to $200 and later to $300 as a means of discouraging new applicants from
coming into the union. The unhealthy atmosphere of feverish construction
activity made it clear that the boom would be short lived and the union did not
wish to assume permanent obligations toward new members whose employment
would obviously be of short duration. To make the entrance into the union
prohibitive the local set the initiation fee at a theoretical figure of $1,500. No
•one has ever actually paid such a fee and no one expected that such a fee would be
paid.

It is perfectly true that 14 years ago, at the time of the speculative boom in
•Chicago, when real-estate values were skyrocketing, when speculative builders
were anxious to build fast and unload new buildings at the highest possible values.

5450 WASHINGTON HEARINGS

the high fees established by the glaziers' union did serve to restrict the entrance
of new members into the trade. Had the initiation fees been low at the time
several hundred more men might have been allowed to come into the Chicago
boom market at the very peak of speculative activity and gain a few weeks of
employment.

The year of prosperity in Chicago in which real-estate speculators, starting
on a shoestring and running up their business into a succession of million-dollar
deals and, in some instances involving the sale of imaginary tracts which the buyer
later found to be located in Lake Michigan, this brief and fantastic era in which
even subcontractors were sometimes making $10,000 a day, collapsed quickly and
completely. It is futile to argue today after many years of unemployment
and distress among the workers who became the victims of the speculator and the
profiteer, whether or not the fee which was thus established but which was never
paid, was a mistake. It is also dishonest to resurrect the ghost of an initiation
fee that had never ma.terialized in order to convey the impression that such a
practice actually ever existed, that it does exist today, and that it is an example of a
typical union practice in a defense situation.

Glaziers' Local Union No. 27 consists of approximately 475 members. To
date there has been very little work for these men in the Chicago area. What-
ever work there has been had been manned by union members and no initiation
fees have been collected. The best evidence of this is the fact that half the mem-
bership of this union is stiU unemployed.

While there are no requests for membership in the glaziers' union in Chicago,
the established initiation fee in the union is $50 which anyone applying for mem-
bership could pay in small installments over a period of time.

Glaziers have received very little employment from the defense construction
program. Barracks, cantonments, and temporary housing projects which are
almost entirely of frame construction, have used glazed sash made and assembled
in factories. Practically everywhere on these projects installation of factory-made
windows and sash have offered no share of employment to union glaziers. Wher-
ever glass installation has been called for the unemployed union members have
by far exceeded the number of workers needed to do the job. As a practical
matter, therefore, when Thurman Arnold talks about the tremendous restriction
of the supply of skilled labor by initiation fees, he talks pure theory and probably
does not realize that his plausible-sounding fantasia bears no relation to existing
realities.

The 125,000 men who comprise the membership of the Brotherhood of Painters
of America are average Americans and patriotic citizens. In their number there
may be, as there undoubtedly would be in any group of men of such number,
some men whose character or behavior can be questioned. There have undoubt-
edly been some practices which the officers of the American Federation of Labor
and the officers of the brotherhood would agree to be improper and would endeavor
to stop. That such is the purpose of the general executive board of the national
union I have the assurance of the general president. I am informed that the
general executive board of the brotherhood has disapproved agreements in which
the initiation fee has been increased since the inception of the defense program
and has instructed local unions to lower rather than increase their initiation fees.
I am also informed that in order to more fully cooperate with the defense program
the general executive board of the brotherhood has ruled that local unions are to
accept members from other localities, when they are not in a position to supply
an adequate number of members to man the project, without charging these new
members any excessive fees but only the regular dues regularly paid by the
existing membership.

I know that the officers of the Brotherhood of Painters are doing all they can
in order to cooperate with the defense program. Only recently the brotherhood
signed an agreement with the Painting and Decorating Contractors of America
which provides that no strikes will interfere with the construction of any defense
project. Under the agreement no demands for increased wage rates by unions
concerned, after a defense project has been started, and no excessive dues or ini-
tiation fees will be permitted on any defense job. The agreement which became
immediately applicable to contracts totaling $500,000,000 at a high point in our
preparedness program was the first negotiated by the pointers' union and the
contractors on a national basis. Both sides declared in announcing the agreement
that it grew out of a common desire to advance the defense program and to
implement President Roosevelt's appeal for cooperation between labor and
management. The contract covers 6,000 contractors and 1,200 local unions of
the brotherhood.

NATIONAL DEFENSE MIGRATION 6451

I think this agreement is a notable example that the no-strike policy on defense
work, formulated by the building trades and metal trades departments of the
American Federation of Labor, can be implemented. It is vision, leadership, and
patriotism of men who are willing to assume responsibility for the success of our
defense efforts that gives best evidence of the need for willing and voluntary par-
ticipation of labor in the enforcement of industrial peace and in the promulgation
of American defense.

ELECTRICAL WORKERS

The International Brotherhood of Electrical Workers maintains two classes of
membership. In the case of class A members, the constitution provides that 50
percent of the local initiation fee be paid to the international and that the share
paid to the international be not less than $5 and not more than $60 per member.
In the case of class B inembers, the international receives $L50 per member,
plus 50 percent of the local fee charged in excess of $1.50 per each member initiated.

The amount of the particular initiation fee is fixed by the local union. The
International Brotherhood of Electrical Workers has submitted to me a sum-
mary of the initiation fees charged by I. B. E. W. locals, which I submit to you.

The locals of this international are divided into six groups: (1) Primarily con-
struction locals; (2) primarily electrical utihties locals; (3) railroad locals; (4)
manufacturing locals; (5) radio broadcasting locals; and (6) telephone and tele-
graph locals.

In the construction group the initiation fees charged by locals in the localities
reported range from the minimum $10 to the maximum of $200 for class A locals
and from the minimum of $L50 to the maximum of $150 for class B locals. In
the electrical utility group the initiation fees range generally from $10 to $25
with a few locals charging the maximum fee of $50 and $75. The railroad locals
charge fees ranging from $10 to $23, with $25 charged in some instances. Locals
in the manufacturing group have initiation fees ranging from $2 to $10, with a
maximum of $60 in one instance. In the radio broadcasting group the fees range
from $10 to $100 and in the telephone and telegraph field from $10 to $50.

It will be noted that the size of the initiation fee varies with the skill classifi-
cation of a particular worker and that it differs with the size of the community
and its geographical location. Lineman helpers would pay much smaller initia-
tion fees than journeyman linemen, and in this and other classifications the size
of the fee is prorated to the skill and earning power which the worker's standing
in the trade commands. It is the universal rule that the higher initiation fees
are charged only for the top classifications of skill and only in the largest cities
in the country.

All these are standard provisions and practices of the International Brotherhood
of Electrical Workers. With respect to defense employment, these practices and
policies have been modified to meet the need of emergency conditions. This is
done by the local unions declaring periods of "open charters" during which stand-
ard initiation fees are drastically reduced. In communities in which defense
projects resulted in the demand for more workers than the local union could im-
mediately provide, periods of open charters have made it possible to bring into
the union new members without requiring them to pay standard initiation fees.
Under open charters initiation fees ranged from $50 to $25 and that even with
respect to the topmost skill classification, no fee larger than $25 was permitted.

The International Brotherhood of Electrical Workers has paid old-age and
death benefits to its members which are very substantial. The old-age benefits
are paid at the rate of $40 per month when the member reaches the age of 65.
Death benefits range from $300 for those who have been members for 1 year to
$1,000 for those who have been members for 5 j^ears or more. In 1939 the Inter-
national Brotherhood of Electrical Workers paid $1,002,697 in benefits. Other
benefits are paid by local unions, and funds are maintained for many other
services extended by local unions.

PHOTOENGRAVERS

Initiation fees of the various local? of the International Photoengravers' Union
var}^ widely. In many localities this fee is as low as $25, in some instances the
fee may be higher. The international provides that journeymen who have
been employed at the trade for not less than 5 years may be admitted on payment
of an initiation fee of $200 plus whatever the local initiation fee may be. Local
monthly dues are usually quite low, ranging from 75 cents to $3.75. The usual
rates are $1, $L50, and $2. A few locals have no local union dues in addition to
the international per capita tax, which is $2 per month.

Q452 WASHINGTON HEARINGS

The initiation fee may be considered as a contribution to the capital resources
of the union otit of which the several benefits paid by the international union to-
its members are financed. The initiation fees build up the resources of the union
and provide a backlog against emergencies, while monthly dues paid to the
international are calculated to preserve this fund and compensate in some measure
for the continual demands made upon it.

The union pays four different benefits to its members. In case of strike or
lock-out members receive strike pay from the defense fund. During the year
ended May 31, 1940, the union paid $41,442.75 in strike and lock-out benefits.

The union has a fund used for the payment of hospitalization and other expenses
of its members suffering from tuberculosis. Last year $20,046 was spent in this
manner. Upon the death of a member of the international union it undertakes-
to pay the expenses of his funeral. Last year $26,800 was paid out in funeral
benefits.

Since 1928 the international has been operating an insurance and disability
plan which has cost large sums of money annually. Last year, for example,
insurance and disability payments amounted to $141,816. Under this plan all
journeymen and apprentices after their third year of apprenticeship are insured
in the amount of $1,000.

The servicing of the four benefits paid by the international union enumerated
above cost the union $230,104. Total revenues of the international amounted to
only $364,382. Put in other words, these expenses accounted for 63 percent of the
total income of the union.

Since its organization in 1900 the international union has paid a total of
$3,727,832.78 in these four benefits to its members. During this time strike and
lock-out benefits have amounted to $1,646,903.08; tuberculosis payments to-
$629,615.47; funeral benefits to $329,481; and insurance benefits to $1,122,833.23.
The reason for the relatively large share of strike benefits in this total is the fact
that strike benefits were for a considerable period of years the most important
benefit paid by the union. The tuberculosis payment was not established until
1908 and the insurance payments until 1928. For the last few years insurance
payments alone have accounted for approximately 60 percent of all benefit
payments.

It should be noted that these benefits are paid exclusively by the international
union and are financed by initiation fees and by the income which the union de-
rives from the monthly per capita tax of $2. These substantial forms of protec-
tion which are afforded to its members by the international union could not
possibly be maintained without the payment of initiation fees and monthly per
capita taxes.

In addition to the benefits paid by the international union a large number of
the local unions composing the international pay benefits of their own. During
the year ending May 31, 1940, local unions paid $938,534.63 to jobless members
as protection against unemployment. Sick benefits of local unions amounted to
$26,371.35 and death benefits to $60,700. From this it is apparent that total
benefits paid by local unions were $1,025,605.88 or almost five times those paid
by the international.

The unemployment benefits are paid by i 2 local unions having a membership
of 8,636 journeymen. The unemployment benefit varies as between local unions
but is usually $10 to $15 per week and may be paid for 26 weeks or 52 weeks
depending upon the local in question. During the depth of the depression very
substantial sums were paid out in unemployment benefits. During the years
1932-33 these benefits were continuously well in excess of $1,000,000 per year
and in 1933 amounted to $1,959,617.96.

Adding the total of local benefits in the amount of $1,025,605.88 to the total
international benefits paid in the amount of $230,104.80 we find that total inter-
national and local benefits of the Photoengravers' International Union amounted
to $1,255,710.69 for the year ended May 31, 1940. This impressive total reveals
clearly the extent of the protection afforded the membership of this union by the
monthly dues and initiation fees which it pays. The extent of these benefits and
the proportion which they bear to the total income of the union are compelling
evidence that the members of this union are receiving protection to the full extent
warranted by their financial contributions to the union. Facts of this sort must
be set against the unconsidered arguments of those who make statements without
any investigation of the realities of specific situations.

NATIONAL DEFENSE MIGRATION 6453

BRICK AND CLAY WORKERS

The international constitution of the United Brick and Clay Workers of America
requires the payment of a minimum initiation of $1.50. The maximum initiation
fee is governed by district councils and by local unions. In the case of a newly
formed local union, the initiation fee may range from $2 to $3, and in the case of a
firmly established union the fee is generally $5. In the Los Angeles area on the
Pacific coast the initiation fee is $3.

The international union receives $1 from each initiation fee collected by the
local. Dues assessed by local unions are generally $1.50 per month. In some
locals the dues are as low as $1 per month, and in the Chicago area the highest
dues of $1.75 per month are collected. The international union receives a per
capita tax of $1 from monthly dues paid by each member.

The international pays out death benefits of $200 and local unions maintain
additional death benefits averaging around $400. While the international union
provides full service to each local union in connection with wage negotiations,
collective bargaining, and other union needs, which is equivalent to the business
agent service, no general benefits other than the death benefits are paid out.
The low initiation fees charged by this international makes it impossible to main-
tain large systems of sickness, disability, and old-age and unemployment benefits
of the type operated by international unions whose fees are proportionately
larger.

Additional information on the administration of benefits and procedures with
respect to initiation fees and dues in these and other unions is available and will
be furnished gladly to the committee either by the national and international
anions themselves, or by the American Federation of Labor.

As a rule, relatively few national and international unions control the local
union policies with respect to initiation fees as a matter of their established and
normal procedure. In practically all cases the American Federation of Labor
unions have prescribed specific emergency policies with respect to initiation fees
which govern the entire organization in connection with the defense program.
These union policies have to fit particular situations in a great multiplicity of
trades and occupations, and reflect a great number of special problems which are
involved.

As a general rule, large initiation fees have been charged in only exceptional
cases and have been drastically reduced or altogether suspended in the operation
of the defense program. The fact that the fees and dues charged are necessary
is shown by the extensive benefits which the American Federation of Labor has
made available to its membership. The fact that the practices are fair, equitable,
and not restrictive can be attested by 5,000,000 members of the American Feder-
ation of Labor who have come into the membership of our organization, who form
a representative cross section of the American wage earners and who in the final
analysis control and determine the policies of their unions.

It must be remembered that new members who join the union and pay their
initiation fee become beneficiaries and participants in the funds already accumu-
lated in the local treasury and available for sickness, death, accident, and unem-
ployment benefits. In addition, it must be realized that a newly admitted member
of a union becomes a beneficiary of wages and working conditions which it has
taken generations of unionists to establish, and for which the union has fought
over many years. When the union worker gains the benefits of union conditions,
he owes a debt to his union for the immeasurable sacrifices and suffering sustained
by those before him, in strikes, discharges for union activity, and discrimination
on the part of hostile employers. It can hardly be argued that nonunion members
should be admitted into the union ranks without payment of any fee when all
those before them have contributed their share to the economic strength of their
organization.

I am laying these facts before you, not as a justification for the imposition of
excessive initiation fees in the time of national emergency. I feel that the emer-
gency situation calls for special consideration and special action by our unions.
Practically all of our unions have taken cognizance of the situation and have
acted accordingly. Within the limitations of our authority, we in the American
Federation of Labor have established reasonable and uniform standard initiation
fees in every instance known to us and have done away with abuses. Most of
our national and local organizations have taken the necessary action to meet the
present conditions voluntarily and on their own initiative. They have done so
in the interest of the common good as patriotic American citizens who know that
every one of us in America is engaged in a job of most crucial importance, that of
preserving liberty and democracy in America and in the world.

g454 WASHINGTON HEARINGS

TESTIMONY OF WILLIAM GREEN— Resumed

Mr. Curtis. Mr. Green, might I take a moment to state in that
connection that the task of this committee, when it originally was
created, was to investigate the interstate migration of destitute citi-
zens. "V\e were aware of the fact that due to the depression and
other causes there were a great many up-rooted people in the United
States, perhaps running into several millions, who were citizens of the
United States but belonged to no State or no community.

We were focusing oui* attention on that problem and then we found
that it all tied into the defense program, which was just coming on as
we were conducting our investigation last year. So the Congress has
asked us to continue to inquire into some of the problems that have
come about by reason of the large groups moving to and from defense
areas.

Mr. Green, I could repeat or agree with what Chairman Tolan said
about your paper. It is a very valuable one, as I know that the sup-
plemental paper will be, although I haven't seen that.

Now, before we start these questions if there is any preliminary
statements that you would care to make, anything you want to treat
in a general way in regard to this problem, we will be very happy to
have you proceed.

Mr. Green. I have covered the subject very completely and fully,
I think, in the prepared statement that I submitted. Further, the
subject is covered still further in the supplementary statement that I
have now presented for inclusion in the record. It is quite detailed
and for that reason I have no preliminary statement whatever to make.

ALARMING INCREASE IN RENTS

Mr. Curtis. Mr. Green, many industrialists have testified before
this committee that the defense workers cannot find defense housing
at rents they can pay. Does the American Federation of Labor have
any views on our present housing program?

Mr. Green. Yes, sir; from practically every area in which defense
work is going on it is bringing in new workers from practically every
area and we have reports of alarming increases in rents.

Much of this material has been covered in the body of my state-
ment and in the supplementary outline of our survey through central
labor unions and State federations of labor.

Rents have increased from 10 to 200 percent in these areas, with
50-percent increases common.

Many of the new homes and apartments built are not priced
reasonably for workers. I refer you to the supplementary statement
where I am sure you will find some interesting information regarding
rent increases.

That information was sent to me in reply to the questionnaire that
I dispatched to the offices of our subordinate local unions, located in
different towns, cities, and communities throughout the country.

The Chairman. Mr. Green, I wonder if I could interrupt you for
a moment. The committee has just returned from San Diego, Calif.,
and that city has jumped up about 75,000 or 100,000 in population.
When we went there everything was fine — there was no rent trouble
at all, but the committee's staff got busy on the proposition and we
put a witness on there who was a defense worker. He had six children

NATIONAL DEFENSE MIGRATION 6455

and he testified tie had one room and a kitchen — that means eight of
them were hving in those quarters, and that he was paying $18 a week
while his mcome amounted to only $135 a month. Now, how is he
gohig to save any money? I don't know, but that simply bears out
what you are saying.

Mr. Green. Well, a case of that kind is rather shocking, Mr.
Chairman, but I am of the opinion that it is duplicated over and over
again in different cities and towns and communities tlu-oughout the
country.

As I have explained, I have referred to this matter in quite an
extensive way in the report that I submitted m my general statement,
so that I respectfully refer you to that section in the statement I
made under "Housing," and I am sure you will find a broader and
more complete answer to the inquuy you just made.

LABOR COSTS STILL BELOW 1929

Mr. Curtis. Mr. Green, the statement has been made quite a
number of times by a number of people who have appeared before us,
that the answer to rising rents and rising wages and all that sort of
thing is to keep prices down all along the line.

What comment do you have to make in regard to that?

Mr. Green. Labor certainly does not want to see an inflationary
spiral which would only result in a lower standard of living. There
is certainly much truth in the statement that higher prices and
profits will make it necessary for workers to continue to push wage
increases. However, much of the increase in wages received today
is only a belated recognition of the greatest labor productivity which
has not been paid for by wage increases in past years. Even with the
higher wages labor cost per dollar value of production are lower now
than they were in 1929.

Based on 1929 = 100 the indexes show: Output per worker for the
first quarter in 1939 was 99.5 percent; for the first quarter of 1940 it
was 105.4 percent, and for the first quarter in 1941 it was 116.5 percent.

Now, there is a very noticeable and progressive increase in output
per worker.

Now, the output per man-hour in 1939 for the first quarter was
129.9; for the first quarter of 1940 it was 136.2, and for the first quar-
ter of 1941 it was 141, another corresponding increase.

Now, the labor cost per $100 of output in the first quarter of 1939
was 103.1; for the first quarter of 1940 it was 100.6 and for the first
quarter of 1941 it was 99.7.

Now, these are strikmg figures and I presume that much of that is
due to the development of efficiency, perhaps caused through the
introduction of a wider and broader basis of mechanical equipment,
which has tended to make the worker more efficient and to increase
individual productivity.

A. F. OF L. WORKS FOR BETTER DEFENSE HOUSING

Mr. Curtis. Coming back to this housing situation, what has the
American Federation of Labor done to secure better defense housing?

Mr. Green. The records will show that the American Federation
of Labor was the first to focus public attention on the defense housing
problem.

g456 WASHINGTON HEARINGS

As early as September 1939, long before a word was said by any
group about the enormous housing problem we were about to face,
the housing committee of the American Federation of Labor issued a
statement pointing to the need for immediate action. We promptly
urged the enactment of Public, No. 671 or the Lanham Act and other
measures calling for full utilization of the available public housing
agencies for defense housing work.

Our local housing committees in nearly 600 communities have
cooperated with local housmg authorities and with Federal agencies
in expediting defense housing in defense areas.

Our building trades unions have given wholehearted cooperation
to the United States Housing Authority and other agencies by enter-
ing into voluntary agreements providing that no strikes for any
cause would take place in the course of defense housing construction.

According to the War Department, on the cantonment construc-
tion, of a total man-hours of work only three-one-hundredths of 1
percent represented delay due to labor difficulty of any kind.

The record of the American Federation of Labor in defense housing
has been that of not only full cooperation but also of constructive
leadership.

I have covered that subject pretty fully, too, in both the general
statement and the supplementary statement which I have submitted
for the record, and I am sure you can find a more detailed answer to
your inquiry in these statements.

The Chairman. The object of these public hearings is to give the
public and the press information as to just wdiat you are doing. Your
cold statement might be in here but the public and the press might
not hear of it unless you stress it in your oral testimony.

Mr. Green. Well, we welcome that opportunity. Congressman,
and thank you for it.

INITIATION FEES IN BUILDING TRADES

Mr. Curtis. Mr. Green, we were holding some committee hear-
ings in December and a gentleman appeared before our committee who
stated that he was unable to get a job out here at Fort Bel voir because
of the high initiation fee of a building-trades union. Many of these
new construction workers are migrants, as you know, Mr. Green,
people far away from home. What benefits do these new workers
receive from the unions in return for such fees?

Mr. Green. Well, those of you who were members of the Judiciary
Committee will remember that I covered that subject very fully. I
faced the facts and presented them to the committee. It is pretty
difficult for one to pass upon the merits of a complaint filed in indi-
vidual cases, but I Imow that it has been the general policy of the
American Federation of Labor to make it as easy as possible for build-
ing-trades workers to become members of American Federation of
Labor unions, and as a result of it many of the building- trade organi-
zations changed policies these organizations had pursued for many
years, by calling upon their local organizations in different cities and
towns and communities to establish a maximum initiation fee and
that maximum initiation fee was reduced to the lowest possible level
consistent with the financial requirements and benefit obligations of
national and international unions.

NATIONAL DEFENSE MIGRATION

6457

I know of no single instance where any worker capable of perform-
ing work on buHdings and in biiOding construction was denied the
opportimity to become a member of a miion and to engage with others
in work, construction and building work.

In some instances men represented themselves to be skilled mechan-
ics and applied for work; the manager or the foreman employed them,
believing they were skilled. They started then to pay their initiation
fee into the union but it developed within a very short period that
they were not mechanics and as a result of it the manager or the fore-
man dismissed them, because they simply could not measm'e up to the
requirements as to skill. But in those instances the unions were
always instructed and required to return to the worker any initiation
fee or dues paid.

BFNEFITS PAID OUT BY UNIONS

Now, I have a statement here covering benefits for sickness, dis-
ability, unemployment, old-age, death, and miscellaneous, paid by
our unions out of the initiation fees and dues collected. These figures
are startling.

The record shows that from 1927 to 1939 our unions paid out in
sickness, disability, unemployment, old-age, death, and miscellaneous
a total of $425,742,166. That means that the initiation fees and dues
collected are redistributed in sickness, death, accident, unemployment
benefits, and in the payment, of course, of administration costs.

The new worker, when he becomes a member of the union, acquires
an equity in all moneys in the local treasury. He has an equal share
with all that are in the union and he is entitled to receive his benefits
and I would like to submit these figures for the record and if I may,
this statement beginning with "initiation fee" and covering the other
subject of benefits.

The Chairman. It will be received.

(The document referred to follows:)

Exhibit A.-

-Benefits.

paid by national and international unions of the
Federation of Labor, 1927-39

American

Year

Sickness

Disability

Unemploy-
ment

Old age

Death

Miscel-
laneous

Total

1927

$2, 793, 859

2, 377, 746
2,831.937

3, 649, 703
2, 220, 975
2,308,041
1,665,266
1.023,314
1,047,011

1, 272, 818

2, 277, 903
1, 306, 768
1, 519, 559

$2, 968, 164
3. 2S5, 578

2. 707, 188

3, 234, 067

3, 671, 380

4, 006, 891
4, 837, 730
3,176,014
3, 379, 276
2, 597, 886
2,623.918
1,641,091
I, 766, 064

$690, 206
665, 280
276, 718
3,311,280
9, 146, 724
19, 970, 557
13, 784, 043
4, 467, 802
3, 356, 276
10, 990. 104
1,671,139
2. 582, 543
1, 815, 784

$4, 348, 936

4, 712, 731
4, 883, 028

5, 910, 995
6, 090, 743

6, 148, 302
4, 678, 636

3, C12, 940
3, 684, 954

4, 784, 506

4, 600, 056

5, 334, 206
2, 073, 327

$15, 724, 821
16, 623, 586

17, 598, 287

18, 527, 095
17, 132, 023
17, 674, 384
14, 780, 206
15,011,044

12, 650, 303
12, 821, 607

13, 390, 755
13, 125, 853
12, 928, 510

$1, 743, 805
5, 149, 053
3. 945, 288
2, 064, 840

1, 700. 028
1, 340, 175

946, 231
1, 409, 530
1, 990, 787
1, 646, 750

2, 547, 454
1. 595, 827
1, 591. 961

$28, 269, 791

1928

1929....

1930

1931

1932 _

1933..

1934

1935..

1936

32, 813, 974
32, 242. 444
36. 697, 980
39, 961. 873
51, 448, 350
40,692.112
29. 000, 645
26. 108. 607
34.113.671

1937

1938

1939

27,111.225
25. 586. 289
21. 695, 205

Total

26, 294, 900

39, 895, 247

72, 728, 456

61, 163, 360

197, 988, 474

27, 671, 729

425, 742, 166

Note. — Detailed reports on benefits paid in 1940 are not yet available.

5458 WASHINGTON HEARINGS

COMPLAINTS OF EXCESSIVE FEES

The Chairman. As I remember yom- testimony, Mr. Green, before-
the Judiciary Committee, you testified that there were some com-
plaints that came in as to excessive fees being charged by some locals.

Mr. Green. Yes.

The Chairman. And that the American Federation of Labor
immediately got on top of it and helped out in every way you could,
isn't that true?

Mr. Green. That is right. There were complaints reached us—
some complaints from Members of Congress referred to us, from public
officials, from administrative representatives in Government, and from
om' members themselves and in every instance we have gone mtO'
every case and have insisted that any injustice imposed upon any
individual must be corrected.

The Chairman. I remember when we had our "Washington hearings
about 6 months ago an electrical worker came here and complained
of some treatment given to him at one of the camps. He testified
that they asked him $300 initiation fee to join an electrical union.
Well, that seemed rather startling to me as well as to other members
of the committee, but when you break that down the way you have
broken it down and explained about these electrical workers and where
they pay and caiTy these apprentices on their rolls for years, and then
the insurance and the compensation that they receive, that told a
different story as far as I was concerned. I was amazed with your
revelation of how it worked.

That is why I am very much interested in your breaking that down
the way you have. In other words, what the American public wants
to know is that there is not some president of some local union or some
treasurer of some local union that is getting fat on these people coming
in and paying their initiation fees.

That is a new angle as far as I am personally concerned. I didn't
know that before — I didn't know how they participated in those
benefits.

JURISDICTION over LOCAL UNION POLICY

Mr. Green. Well, you see, Congressman, under the laws of many
international unions the local union is chartered by the international
union and is clothed with authority to fix the initiation fee in their
respective local.

The national union delegates that power to the local organization.

The Chairman. Then what jurisdiction do you have over them?

Mr. Green. We have only a supervisory jurisdiction over that
and we try to deal with that in accordance with the facts, but because
this authority was delegated to the local union, the national unions
then took the action I referred to a short while ago, that they must
reduce their initiation fees to a uniform maximum basis and the locals
then were deprived of the power to put it above that maximum basis.

The Chairman. Well, didn't your national convention last year
take some action on that?

Mr. Green. I think we did, Mr. Chairman, but I just can't recall
at the moment.

Mr. Osmers. Wliat was the maximum amount of initiation fees^
Mr. Green?

NATIONAL DEFENSE MIGRATION 6459

Mr. Green. Well, it was different in different organizations. Now,
the common laborers, against whom there was very much complaint,
ordered that their initiation fee be reduced to a maximum of $25 —
no more than that anywhere or any place.

The United Brotherhood of Carpenters, on the other hand — I am
referring to the one as unskilled and the other as highly sldlled —
the United Brotherhood of Carpenters and Joiners, as I recall, fixed
the maximum fee for carpenters at $50.

Many locals had it above that.

HIGHEST INITIATION FEE

Mr, OsMERS. Wliat is the highest fee that you know of now existing?

Mr. Green. The highest initiation fee that I ever heard of in the
American Federation of Labor was $1,500, imposed by a glazier's
union in Chicago. But as I explained; I went into that too, Mr. Chair-
man, in my testimony before the Judiciary Committee. The facts
are that nobody ever paid it but it was set so liigh due to the fact that
unemployment was so widespread and so far-reaching and with such
-destructive results in Cliicago, that the local itself thought they woidd
deal with the unemployment problem by putting the initiation fee
high.

Mr. OsMERS. In other words, to exclude people from membership
in the union and to keep whatever work there was to themselves?

Mr. Green. It was really an attempt to exclude membership in
the organization so as to make it possible for those who were already
in to secure work.

Mr. OsMERs. Do you happen to loiow what that particular union
lias for an initiation fee at the present time?

Mr. Green. I don't know. That is under the Painters and Deco-
rators International Union.

The Chairman. Mr. Green, Congressman Curtis has been called to
the floor of the House so I will continue with the questioning.

Following up these questions: We understand that the American
Federation of Labor has assisted in routing workers to construction
jobs. Would you describe this work for the committee? In other
words, what have you done toward routing any workers to any jobs?

Mr. Green. The building trades, machinists, and electrical workei-s
have done a great deal of this work and other unions have placed
workers and helped find men for defense jobs. In the summer of 1940
as soon as we learned that large numbers of skilled workers would be
needed for defense construction, international unions affiliated with
the budding-trades department of the American Federation of Labor
made a survey of their affiliated locals to find out the number of
unemployed members seeking work, and those wdio would be willing
to go to other towns. We anticipated, in 1940, just such a situation
as we have drifted into.

employment exchange within union

To set up within our building-trades department a great defense
•employment exchange was not difficult, for our international unions
already served their membership as Nation-wide employment offices.
Business agents in local unions normally act as placement agents,
jeferrmg men to jobs. Therefore, we had only to bring information

5460 WASHINGTON HEARINGS

together in central headquarters to estabhsh a clearinghouse covering
the entire Nation. "With this information at hand we were ready to
act at once.

Calls for skilled craftsmen came urgently for cantonments, powder
I)lants; for airplane factories and all the varied types of defense build-
ings. Calls to our building-trades department came from contractors
or from the United States Government were quicldy transferred to
the international unions and men were sent to the job in Charlestown,
Ind., to build the huge Du Pont smokeless powder plant. Twenty-
three thousand workers were required.

Charlestown was a tiny place of 900 inhabitants. There was no
nearby source of labor supply sufficient to meet the need. Labor for
this job was recruited literally all over the United States by our unions
and sent promptly to the spot. Men came from thousands of miles
away and this entire job of labor recruiting was done by union offices
without a cent of expense to the Government or to the contractors for
the huge task of contacting the men and transporting them to the work.

The Chairman. Did your union pay the transportation costs?

Mr. Green. Yes, sir; paid their transportation costs. We sent
15,000 men to Corpus Christi, Tex., and it never cost the Govern-
ment a single penny.

Now, the tragic feature of that is this, that after the job was over
the men were dismissed. They themselves then were required to do
the best they could for themselves — find work in some other town or
some other place. Their job was done at Corpus Christi.

RECRUITING FOR CANTONMENT CONSTRUCTION

Now, a similar job was done in Fort Leonard Wood, Mo., where
29,000 men were needed to build the cantonments. Labor was re-
cruited within a radius of 200 miles and sent promptly to the job. Men
came in their cars, bringing a carload of workers with them. The cars
then served to transport workers between their lodgings and their
work, because often it has been impossible for members to find lodg-
ings within even 25 miles of the job. Drives of 40 or 50 miles morning
and evening was the daily lot of very many.

Now, in Jacksonville, Fla., it was necessary for our organization to
send plumbers all the way from New York. In Corpus Christi, as
I said, our oi^anization supplied over 23,000 construction workers.
I said 15,000. The actual figure is 23,000 and those 23,000 trans-
formed a wilderness into the most ro.odern airplane training station
in the world, and completed that job 6 weeks ahead of schedule.

In Camp Shelby, Miss., we supplied the work force to build what
amounts to a small city, to house 67,000 soldiers. The following
structures were put up: 13,000 tent fram.es, 414 mess halls, 80 ware-
houses, 56 administration centers, a laundry, a hospital; 34 post ex-
changes, 85 miles of water mains, 60 m.iles of sewer and 65 miles of
paved roads.

This work was completed ahead of schedule, costing the Govern-
ment only $20,000,000 as compared to the estimates of $22,000,000
for that job.

In Fort Belvoir, we completed a camp to house 20,000 soldiers in
less than 3 months.

In Ravenna, Oliio, we are supplying over 12,000 men for the con-
struction of a $14,000,000 Atlas Powder Co. plant. We drew labor

NATIONAL DEFENSE MIGRATION 6461

for this job from all over the country and work is proceedhig up to
schedule in building these contonments for the United States Army.
We have in effect constructed 46 small cities m 6 months' time.
These cities house anywhere from 20,000 to more than 60,000 men,
and involved the building of living quarters, powerhouses, roadways,
store buildings, hospitals, laundries, mess halls, sewage systems, and
water-supply lines.

COOPERATION AMONG THE INTERNATIONALS

The labor supply for this colossal task has been furnished by the
international unions affiliated with our building trades department
and as noted above, without any cost to the Government or to
contractors.

When an international could not furnish all the men needed the
requirements were filled by cooperation with other internationals.
The International Association of Heat and Frost Insulators and
Asbestos Workers, for instance, having more calls than they had men
to supply — that is a small organization composed of highly skilled
worker's and the call for service of the kind that these skilled workers
are able to give is very limited during normal times, but the emergency
increased the demand for them.

Now, these workers agreed to accept members of the plasterers
international union, an association of unions in both the United
States and Canada, for the work, without charging either an initiation
fee or dues. In other words, the two unions worked out a plan by
which they could supply the contractors in this national emergency
with the number of skilled workers required.

Now, unions in the metal trades have also contributed. The
International Association of Machinists has recruited men for work in
navy yards, arsenals, airplane plants and in other metal work from
the entire country. Registration of unemployed machinists began
on May 23, 1940. They began to register them then.

Local lodges have been alert to notify the international office
immediately when they foresaw that new work would require addi-
tional men for work in the Bremerton, Wash., Navy Yard. The
lodge there advised headquarters that a large number of machinists
would be needed.

The international immediately sent job specifications with rates of
pay and requirements to all lodges west of the Mississippi River.
Men were advised that medical examinations would be required and
they were urged to take these examinations before leaving for the job.
They were instructed to send their qualifications to the Bremerton
office and be ready for immediate summons. In this way Bremerton
was able to mobilize its work force with a minimum of waste motion.

The Bremerton lodge met the men on arrival and assisted them in
getting quickly registered and on the job.

Similarly, the machinists recruited 3,000 machinists and 1,650
toolmakers for the arsenals, the airplane mechanics for Vultee and
Lockheed and men for many other defense jobs.

COOPERATION WITH UNITED STATES EMPLOYMENT SERVICE

The supplying of skilled union men to jobs was further improved
and speeded by linking our union employment activities with the

g462 WASHINGTON HEARINGS

United States Employment Service. We worked with them. That
was necessary because we found that in spite of the great demand
for skilled workers our activities in referring them to jobs and so
forth, yet literally there were thousands of workers traveling around
looking for work and not knowing where to go.

Clearly we needed centers of call and it was obvious that these
could be best furnished by the 1,500 local offices of the United States
Employment Service. Union placement is not competing but is
cooperating with the United States Employment Service.

Now, I have gone into that as I have, because I think it constitutes
a more detailed answer to the inquiry you made, Mr. Chairman.

The Chairman. I receive many letters, as other Congressman
undoubtedly do, regarding how they can get employment in the na-
tional-defense program. After hearing your statement I shall refer
them to the State employment offices. I would like to know now,
and I know the committee would too, what is the A. F. of L.'s reaction
to the service you are getting from the State employment offices?

Mr. Green. Well, our reaction to the service given by the employ-
ment offices is favorable. They have done excellent work, we think.
There are 1,500 employment offices in the United States

The Chairman. I am talking about the Federal service.

Mr. Green. The Federal service and these 1,500 Federal offices
have rendered a very excellent service, we think, but I think our
unions have been in closer touch with the defense industrial program
than have the employment offices. That is because of this instru-
mentality, this agency which was already set up, for you know that
in practically every community, small and large, local organizations
of the American Federation of Labor international unions are estab-
lished. The employment offices are not in every locality.

The Chairman. That is true.

Mr. Green. Consequently, these agencies already set up serve
quickly and as a result of it we have been able to do the things that
I have just related in answer to your question.

CHECK OF labor SUPPLY BY STATE EMPLOYMENT SERVICES

The Chairman. Mr. Green, you heard part of Mr. Hilhnan's
testimony this morning, didn't you?

Mr. Green. I came in quite late.

The Chairman. I wanted to ask him but time would not permit
so I am going to ask you this question:

I wonder if there is any check being made at the State employment
offices or at the United States employment offices as to the load and
as to whether certain men are available and whether certain men are
not available. For instance, I received a letter about 2 months ago
from a painter in Oakland, Calif. I know him to be a qualified
painter. Well, prior to that he had been writing me for months. I
know him to be a capable, competent man. He couldn't get a job.
But the first thing when we got down to San Diego recently, to hold
a hearing, I found that there is a dearth of painters there.

So I have taken the matter up with him again. What I am trying
to get at is this: Does the Federal Government check the list to see
if the load is moving or what do they do about it? Do they just
register them and let it go at that?

NATIONAL DEFENSE MIGRATION 6463

Mr. Green. I couldn't answer that.

The Chairman. There was this one instance wliere this capable
painter, Mitchell, couldn't get work in Oakland and the employment
agencies did not seem to know of any elsewhere.

You say there are 1,500 United States employment agencies in the
United States?

Mr. Green. Yes.

The Chairman. What do these men who are looking for positions
in the national defense do when there is no United States employment
agency near them?

Mr. Green. The States have established State employment offices,
which are a definite part of the Federal Employment Service. The
1,500 local offices I mentioned represent, jointly, the State and Federal
services.

The Chairman. Yes.

Mr. Green. Of course private employment agencies still operate
to some extent. I don't know just to what extent they do operate,
but I thinlv they operate and they place men in these defense produc-
tion enterprises.

The Chairman. What I was trying to get at is, I don't think there
is any particular magic in a man who is a painter, for instance, wallc-
ing up there and registering to the United States Employment Office,
if they let it go at that. Is there anything done about it to keep him
moving? That is what I am trying to get at.

Mr. Green. I think that is a subject you might well go into, in
order to determine whether the State and Federal Governments are
giving adequate employment service — whether it can be improved
upon, whether it can be enlarged and whether it can meet the general
requirements.

SAYS SHIPBUILDING STABILIZATION HAS NOT FROZEN WAGES

The Chairman. The Shipbuildmg Stabilization Committee is
freezing the pay of shipyard workers at a time when rent and food
prices are rising. It is charged that this is unfah to labor. What is
your opinion of the work of the Stabilization Committee?

Mr. Green. The work of the Stabilizing Committee has not frozen
wages. On the contrary the ship-zone agreements which were nego-
tiated for the Great Lakes, Atlantic seaboard, Gulf of Mexico, and
Pacific coast all carry specific provisions for automatic increases in
wages as based on the Federal index.

Now, I will quote the section in the master agreement which covers
that particular question. It is in section 22 of the master agreement
and provides: [reading]

''Provided, however, That on demand of labor at the end of the first
year's operations under this agreement, and on demand of either party,
every six months thereafter, the wage scales herein agreed to shall be
reviewed by the parties. If the cost of living, as shown in the index
numbers of cost of goods purchased by wage earners and salaried
workers in large cities, published by the United States Bureau of
Labor Statistics, United States Department of Labor, shall have
changed, at the time of the review, from the cost of living at the time
of the maldng of this agreement by 5 per centum or more, the wage
scales shall be correspondingly adjusted."

60396 — 11 — pt. 16 11

5464 WASHINGTON HEARINGS

I Lave a copy of that agreement here.

The Chairman. Perhaps you had better leave it for the record.
(The agreement referred to was received and is held in committee
files).

POSITION ON COMPULSORY CONTRACTS AND LABOR PRIORITIES

The Chairman. Mr. Green, what is the position of the American
Federation of Labor on compulsory labor contract plans and on plans
for labor priorities?

Mr. Green. We are opposed to compulsory tying of workers to
jobs. We have jobs. We have faith in the American principle of
free labor, and we do not believe it is necessary to unport Hitler's
methods in order to defend our Nation. We are convinced that the
necessary shift of workers to defense jobs will come about as the result
of voluntary action and as a byproduct of priorities in materials and
machinery.

I have already spoken of amendments to our social-insurance sys-
tem, which I think should be made to encourage voluntary shifts and
to protect defense workers from material loss.

When it becomes necessary to work as a united group in war pro-
duction, we recognize that authorit}^ to make decision must be lodged
in some single head. We are read}^ to accept such decisions as a
responsible head may make for the emergency, provided labor has
opportunity to freely present its case through representatives of its
own choosing. Now that, I feel, sets forth our attitude on that par-
ticular matter.

EFFECT OF CONCENTRATION OF CONTRACTS

The Chairman. Mr. Green, it is frequently claimed that the excess
concentration of contracts is pulling skilled labor from all sections of
the interior of the Nation to a relatively few defense centers. Does
this coincide with your view of the situation?

Mr. Green. Well, I know that defense jobs are pulling workers
from long distances, but not necessarily always away from the Middle
West. For example the electrical workers on a call from Charlestown,
Ind., sent some of their members there from New York. That is, of
course, a long distance. The TNT plant near Joliet, 111., has workers
from almost every State in the Union. The airplane plants at Wichita,
Kans., have brought many workers there. The concentration is wher-
ever defense plants are located and, of course, to the degree that these
are most frequently located away from the interior, skilled workers
will be pulled away from there.

I have no figures on the number of such migrants. The Employment
Service would undoubtedly be best able to give such information. I
believe the W. P. A. studies in a few communities have shown a smaller
percentage of migrants than was expected, although construction
workers were higher than the average percentage of migrants.

The Chairman. Of course, Mr. Green, anyone can see, I think,
quite clearly that this is an emergency program and the Government
had to go into those centers where tlie,y had some present facilities to
do the work, but what the committee would like to know is. Do you
favor the decentralization of industry as we go along or are you in
favor of keeping on where they are now going?

NATIONAL DKKENSE MIGRATION 6465

Mr, Green. Well, I think that the ftu'ilities of comni unities should
be taken into account — transportation, power, geographical Ic; dion,
local conditions.

F. S. A. LOANS AS CHECK ON MIGRATION

It appears to me that the Government is pursuing a pretty practical
wise policy in the establishment of defense mdustries. It would
pro])ably create much dissatisfaction and disturb our national tran-
(}uillity, if I may put it that way, if they would center these plants in
some central point. I thmk the general policy that is being pursued
is a sound and practical one. Subcontracthig should fm-ther take
defense production to the workers.

The Chairman. I was very much interested m that because the
Farm Security Administration's appropriation for rehabilitation loans
for farmers — that is the Government loans, enough money to buy
seed or a horse or a cow to keep them home — which is one of the
solutions for this mterstate migration, was turned down by the
Bureau of the Budget, on the theory that this defense program was
going to take up the slack. As a matter of fact there are 24 States in
the Union getting those loans to keep those poor people at home on
the farms, so they won't take to the road, and out of those 24 States
there are only 5 States that had a semblance of the national-defense
contracts.

Mr. Green. Yes; 1 understand. That is a very important con-
sideration. Of course I judge that the policy pursued by the Depart-
ment of Agricuitui'e in trying to help the farmers of the country is
sound and 1 don't tiiink they should change that because of our defense
program. I don't tliink it should be changed.

LABOR STANDARDS NOT LOWERED BY TRAINING PROGRAMS

The Chairman, Now, Air. Green, there is one more question as far
as I am concerned.

What do you consider the effect on labor standards has been upon
the entrance into the labor market through the training program of a
million or more semiskilled workers.

Mr. Green. Well, in spite of the difficulty in getting workers
qualified for defense production, which has been serious, there has
been little or no lowering of standards down the line.

In order to prevent a situation that would residt in training of too
many, or competition that would result from dilution of skilled crafts,
the American Federation of Labor has proposed that training of
unskilled workers to operate a single macliine or to a single process
should be under a Federal agency and the local committees charged
with apprenticeship training. Oiily such an agency would know how
best to break down a craft into operations and to maintain continuous
training of workers, so that they would become sufficiently sldlled to
do satisfactory production, and sufficiently equipped from the point of
skill to continue to take care of themselves as independent Americans
able to earn their livings themselves.

You see, Mr. Chairman, we are all thmking about the future, when
we thmk about the needs of the present, and m doing so we must
endeavor to balance our policy with what we believe to be the needs
of the future.

6466 WASHINGTON HEARINGS

I know you share my feeling of apprehension over what will take
place when the post-war period arrives. Now, we cannot overtrain
men for one particular calling. What will we do with them when the
post-war period arrives? But we ought to be able to train them in
sufficient numbers so as to meet the requirements of the national
emergency but not overtrain them. That will require the exercise of
judgment and it can only be exercised by men of understanding.

Now, we thmk about those things when we thhik about the applica-
tion of an apprenticeship-training program.

The Chairman. You see, Mr. Green, you are hitting the nail right
on the head as far as I am concerned, speaking for myself. This
investigation that we are conducting now is twofold. That is, this
defense program has caused a great migration from State to State and
that is the only jurisdiction that we have. We are concerned with
how are they getting along — we are not concerned only with guns and
bullets, but how they are living and what are the health conditions.

Mr. Green. Yes.

The Chairman. Because that is morale and you cannot separate
civilian morale from Army and Navy morale, can you?

Mr. Green. No; it is inseparably associated.

The Chairman. Then what you said just now is quite impressive
to me. You have taken pretty good care of the present and you are
laying a pretty good foundation for the future.

SAFEGUARDS AGAINST FUTURE UNEMPLOYMENT

Now, the cushion to take up the shock after this war is over is what
this committee is deeply interested in. I think the only light that
I can see is that all America, practically, is thinking of it. Again
speaking for myself, I think that is just as dangerous as any attack
from without.

Now, speaking for myself again, I think if out of this investigation
we can arrive at some method or means by which these men, who
were unemployed and have been called back mto employment in
defense projects, can save a little something it will help to cushion
the shock.

The question was asked this morning, I think by Congressman
Osmers, "What is being done about it?"

He wants to be specific about that, and he is correct. The only
thing, ISlr. Green, that I know that has been done about it is that the
President issued an Executive order for a survey of public-works
projects for construction after the war is over.

I am not disagreeing with the President. I think that is a fine idea,
but I felt there are other things that should be done to cushion the
after-emergency shock.

Mr. Green. That is right.

The Chairman. Mr. Green, if we can arrive at some plan whereby
the workers may have saved a few hundred dollars by the time the
w*ar is over, so that they might have that cushion, w^e might have that
much of a solution of the problem, temporarily at least. We might as
well talk frankly about it. We don't like to use the words "com-
pulsory savings," and I am not advocating that, but if some system
of savings could be worked out, on a voluntary basis, I feel it would
go a long way toward relieving the problem of our workers after this
defense effort is over.

NATIONAL DEFENSE MIGRATION 6467

VOLUNTARY SAVINGS PLAN

The testiniouy in other cities has indicated that m some plants
there is a voluntary savings plan whereby a certain amount of money
is being put aside each week; but if you have any ideas about that we
would like to hear from you. We are groping for an answer. We
like to talk this over with witnesses. I think a solution of this problem
is highly important. Unsolved, it will be just as dangerous to the
Nation as attack from without. If you haven't an answer for it now,
we would like for you to address yourself to this thought and supple-
ment your testimony with any suggestions that may occur to you later.

Mr. Green. Well, I am of the opinion, Mr. Chairman, that your
committee can probably render a more valuable service through a
study of that question than, perhaps, you can through a study of the
movement of men from one place to another during these days of
national emergency.

Out of your investigations ought to come some very valuable
conclusions and recommendations. I know of no Government agency
at the present moment that is going into that subject.

Please remember that the number of unemployed in the United
States increased from something like- 8 or 9 million in 1930 to
more than 14 million in 1933. That was the peak. Then there began
some small decline in unemployment, comparatively speaking, for
some period of time.

Now, we have taken up the slack of unemployment, not because
conditions are normal but because an unlimited national emergency
exists. Well, it isn't going to exist forever and we still have several
milhon unemployed. Unemployment has been reduced to something
like 4 or 5 or 6 million — somewhere along there. But when the
last act has been put on and the curtain is down and the stage is empty
and these munitions plants are disassembled, when our defense pro-
gram has been completed, can we depend upon private industry
reabsorbing these millions of workers? And if it can't absorb them,
what kind of social conditions are we going to face after these days of
unusual economic conditions? Can our social order adjust itself to
the change in time to save us from the impact?

Now, at the moment, I can't see clearly how we are going to be
able to absorb these men, even gradually, back into productive em-
ployment after we have passed through this unlimited national emer-
gency; but I can't conceive of any subject of greater importance and
1 think now, without a moment's unnecessary delay, we ought to
apply ourselves to the consideration of this problem and see if we can
develop a plan that we can put into effect in order to save democracy
and save America.

FEDERAL FINANCES

Mr. OsMERS. I was very much interested in your last remark, Mr.
Green, in which you emphasized the importance of the post-war period.

There is a subject that must be considered hand-m-hand with it and
I wondered whether youi organization had given it any consideration,
and that is the financial soundness of the Federal Government.

Now, for approximately 10 years we have lived beyond our income
in America, roughly spendmg about $2 for every $1 that we receive.
As a result of the defense program we are speeding up the pace and

^468 WASHINGTON HEARINGS

spending $3 or $4 for every $1 that we receive in spite or our new tax
bill that we hope to pass.

Now, do you see in that situation a threat to American labor — the
continued unbalance of the Federal Government? We now have a
$100,000,000,000 debt as an immediate prospect and some people
today are discussing a $150,000,000,000 debt.

Mr. Green. Well, naturally we are moved by feelings of appre-
hension over that situation. How could any thinl^ing person be
otherwnse? That goes hand in hand with what we believe will be
our post-war problems because, if we have an army of unemployed,
they must be fed and clothed and cared for. The call will be on the
Fedferal Government and that means expenditure of additional Fed-
eral funds with an increase in the national debt.

Mr. OsMERS. Do you believe, Mr. Green, that the national debt of
the United States has a limit beyond which it cannot retain the faith
in its credit?

Mr. Green. There is a limit to the national debt, a safety limit
at least, because if the national debt increases out of all bounds of
reason then we must have repudiation and a lot of other things; and
is there anybody who believes w^e can go through that without having
our governmental and social conditions very seriously affected?

Mr. Osmers. Well, the pomt I had in mind there was that we are
rapidly approaching a time when the carrying charges on the national
debt will equal the highest tax revenue that this Nation has ever had.
If the situation should arrive which you anticipate, and which I
think this committee anticipates, a period of serious unemployment
at the conclusion of the emergency, there will be nothing left to do
but to inflate the currency in one form or another, and that will bear
most heavily on your group, naturally.

Mr. Green. We realize it ahvays bears more heavily upon labor,
because w^e can still remember the stories from abroad when it took a
basketful of German marks and French francs to buy a meal.

no post-war planning organized

Mr. Osmers. Yes; that certainly is fresh in our minds.

Now, I believe you w^ere here w^hen I questioned ^Ir. Hillman this
morning. He made a fine witness on the subjects for which he came
prepared to discuss, but on the subject of the plans that are being
made with respect to this post-war period he was very unsatisfactory,
jind, of course, admitted that he was being unsatisfactory.

Now, I put the same question to you: Do you know of any body or
group in the Government today that is trying to plan our post-war
■economy?

Mr. Green. I loiow of none except that it was announced a com-
mittee had been created some 6 months ago, as I recall

Mr. Osmers. That was at the period, if I may interrupt you, that
was at the period when a large portion of the Government and the
]:)eople of the country thought w^e w^ould be able to have both cannons
«nd butter, but much of that thinking has gone out the window.

Mr. Green. The reason I refer to the appointment of that com-
mittee was because I was asked to assign a representative of the
American Federation of Labor to serve on the committee. I recom-

NATIONAL DEFENSE MIGRATION 6469

mended the appointment of one of our representatives and so far as
I know he is serving on the committee. But it is my understanding
that that committee is engaged in other work and is giving very Httle
time to the consideration of our post-war problem.

Mr. OsMERs. That wasn't the National Resources Planning Com-
mittee, was it?

Mr. Green. Perhaps it was the National Resources Planning
Committee.

Mr. OsMERS. Apparently they are not actively engaged in planning
for that period, because if they were Mr. Hillman certainly would
have been aware of it.

Mr. Green. I judge so; yes.

The Chairman. I think, Mr. Osmers, I can answer that question.
The President issued an Executive order for a survey of the entire
United States, looking toward the solution of this post-war problem,
the survey to be particularly directed to public works resettlement and
such matters. That is all I know about it.

Mr. Green. I think that is it, Mr. Chairman. You have refreshed
my memory. I think that is it.

Mr. Osmers. In other words that committee will get the facts

The Chairman. Yes; and turn them over to the National Resources
Planning Board.

Mr. Osmers. That committee will act as a sort of receiving group?

The Chairman. Yes.

unemployment in a. f. of l.

Mr. Osmers. How much unemployment do you still have within
the ranks of the American Federation of Labor?

jVIr. Green. Well, unemployment in the ranlcs of the American
Federation of Labor is not very great. I cannot give you the figures
now, but I will get them for you and the record. But general unem-
ployment will run about 6,000,000, I would judge.

Mr. Osmers. For the entire Nation?

Mr. Green. Yes; that takes in, if you understand, employables
and perhaps unemployables. We have never assembled figures — we
have never given out figm-es as to the nimiber of unemployables and
real employables and handicapped and so on.

Mr. Osmers. Don't you feel that there is room for such a survey
at the present time? The reason I suggest that is because of the
mail I am receiving here in my office in Washington from people who
have been arbitrarily discharged from the W, P. A. following the
curtailment of W. P. A. funds. I can tell from the letters that many
of these people wTite that they will never be gainfully employed again
as long as they live, due to their background or lack of background — •
their personality, their temperament.

In other words, there will always be, in this human society, some
small margin of it, that is not suitable for institutionalizing, they are
not old enough to get a pension, and we are going to have them with
us at all times probably, as a Federal problem. In the days gone by
the families of these people would generally take care of them one
wav or another.

g470 WASHINGTON HEABINGS

CURTAILMENT IN OUTPUT OF CIVILIAN GOODS

Now, do you feel that a cmtailment in the production of civilian
goods, which is bound to come when priorities become even more
general than they are now, will lead to more unemployment?

Mr. Green. I think there will be curtailment in the production of
civilian goods. I think we will face that situation sometime, but
there is no need for an increase in the army of unemployed even
though we do that. We ought to develop a system tlu'ough which
industries affected by priority orders can be immediately transferred
into war -production, iudvistries — that is, farm out the production
materials that are being manufactured and produced in the larger
defense-production industries, utilize the facilities of these plants that
are affected by priority orders for defense production.

Mr. OsMERS. Do you know of any specific examples where the
Government has been able to influence that change from peacetime
to wartime manufacture or where they failed to achieve that?

Mr. Green. We are seeking to do that now in alummum, for
instance.

Mr. OsMERS. That would be a good example.

Mr. Green. In plants that manufacture aluminum utensils for
domestic use they are being affected very seriously by priority orders.
Now, they have in every one of those plants a very fine machine set
up and for that reason the owners of the plants are quite ready to
make such adjustments and uses of their machine tools and other
machines as are necessary in order to convert those plants quickly
from a consumer-goods manufacturing plant into a defense-produc-
tion industry.

Now rubber will be affected, copper — probably kitchen utensil
manufacturing plants, magnesium plants, and other plants of that
kind. All of them possess many qualities that would make it possible
to transform them from consumer-goods industries into defense-
production industries pretty quickly.

You understand that in some instances a single industry in a com-
munity means the life of that community.

Mr. Osmers. That is very true.

Mr. Green. And if you destroy that, by a priority order, you not
only have an unemployment problem on your hands but you have a
community problem. Now, you can't afford to do that.

Mr. Osmers. The Government is bound to do a certain amount of
it. It will be unavoidable. Even if we make a change over in a
given plant it will take some time to tool and prepare and equip that
plant for its new operation and, of course, there will be a gap between
full employment on peacetime goods and full employment on war-
time goods — there must be, but are there any other factors that you
know of that have slowed down reemployment?

Mr. Green. Well, I can't at the moment, but I think we have
probably some figures and some facts that show how some of our
consumer-goods industries are being affected or are about to be affected
by priority orders. I wUl be glad to assemble it and send it over to
you.

NATIONAL DEB^ENSE MIGRATION Q471

TECHNOLOGICAL ADVANCES AS A FACTOR

The Chairman. Mr. Green, I think I can probably give you a
suggestion. Unquestionably technological advancement — mechani-
zation— has increased unemployment, hasn't it?

Mr. Green. Yes, sir.

The Chairman. And they are perfecting these machines all the
time and that has something to do with unemployment?

Mr. Green. That has had something to do with it and it will
continue to have much to do with it in the days to come. We will
face that in the post-war period too.

Mr. OsMERS. Mr. Green, you used a term in replying to Chairman
Tolan's questioning that I want you to define a little bit better; that
was the term "overtrained." I believe you said we should not
overtrain these yomig men.

Mr. Green. What I mean by "overtrammg" is not individual
overtraining, but overtraming in numbers. It seems reasonably cer-
tain that if we are able to meet the demand of stimulated defense-
production industries with an adequate supply of skilled labor now —
and I know of no shortage of skilled labor of any consequence anywhere
at the present time — what are we going to do with this army of skilled
men that will be unemployed during the post-war period?

"over-training" in aircraft

Mr. OsMERS. I suppose you hit that problem harder in the aircraft
industry than you do in any other industry. I suppose before we
through we will have 1,000,000 skilled aircraft workers in the United
States — I am just making a guess — and the chances are, when the
war is over, we will need only half a million or a quarter of a million.

Mr. Green. That is an industrial situation which naturally at-
tracts our attention. Of course building is going to be heavy — the
demand now for building-trades people is very very great and with
steady employment men are being attracted to the building trades,

Mr. OsMERS. Now, you made a statement before, that I let pass
for the moment, but which is highly controversial. You said you
knew of no shortage of skilled labor of any consequence at the present
time. Was that your statement?

Mr. Green. That is right.

Mr. OsMERs. Wliy is it that we constantly read in the public press
about these shortages of skilled labor?

Mr. Green. Well, I thmk they are probably based upon some story
that originates somewhere rather than because of the facts. Our
survey among our skilled people tends to show that there is no sub-
stantial shortage of skilled labor.

Mr. OsMEBS. Well, Glenn Martin, when testifying before the com-
mittee in Baltimore, said that his plant was at the present time
employing 20,000 people and that by the spring of 1942 they expected
to employ 42,000 people.

Mr. Green. Yes.

Mr. OsMERS. And in questioning him the committee found that
nearlv all of the skilled workers that he would use in the 42,000 next

g472 WASHINGTON HEARINGS

year were not competent today as skilled workers; that they would
hav^e to be trained by a great number of makeshift prog-rams in the
plant and out of the plant, and that they would have to gi-ade up
workers to meet the demand.

It seemed to me that there was an acute shortage of skilled labor in
that particular industry.

Mr. Green. Where?

Mr. OsMERS. In Baltimore, in aircraft production.

Mr. Green. Baltimore?

Mr. OsMERS. Yes; at the Glenn Martin factory.

Mr. Green. Well, my information is that every airplane factory in
Baltimore is supplied with an adequate supply of skilled labor. Now,
I may be wrong on that; but if there is a shortage, it is not acute, and,
of course, I explained m my statement here where there had been some
demand for skilled workers, a small number of skilled workers in
international unions like these frost and insulators. Now, the demand
came on so quickly it was probably difficult to supply all they required
of that character of skilled workers, but they met that situation by
joining up with another organization and supplying the number of
people that were needed.

A. F. OF L. RESTRICTIONS ON APPRENTICESHIPS

Mr. OsMERs. By and large, Mr. Green, do you feel the policy — it
may not even be a policy of the American Federation of Labor, but
the understood policy of the American Federation of Labor for the
last 10 years, whereby they have restricted apprenticeships over these
depressed years — do you feel that policy was a wise one?

Mr. Green. Do you mean during the normal conditions?

Mr. OsMERS. During the last 10 years — the so-called depression
years.

Mr. Green. The trouble was that during those depressed years
there wasn't enough apprentices — enough yovmg men made applica-
tion to take advantage of apprenticeship opportunities to meet the
requirements, because there was no work for them and as a result of
that the number that was specified by our international unions to serve
as apprentices was never equalled because they were all out on the
streets.

Mr. Osmers. In other words it was not a restrictive policy of the
American Federation of Labor?

Mr. Green. No; it was because the young men did not enter mto
the building and construction industry and metal trades as apprentices.

Mr. Osmers. Now, one problem that has confronted this committee
at almost every turn of the road has been the problem of the Negro.
We have found in studying migration that literally hundreds of thou-
sands of Negroes have moved about the country over the past years —
they have come principally from the South ; those on the easterly slope
of the Appalachians having gone up to New York and Philadelphia
and Baltimore and those on the western side of the Appalachians have
gone up to Chicago, St. Louis, Detroit, and so on.

We have heard charges many times that the unions of the American
Federation of Labor, in many instances, prohibit Negroes from mem-
bership.

>'ATIONAL DEFENSE MIGRATION 5473

Now, you have heard, of course, the recent statement, that we all
endorse, by the President, that Negroes should take their full part in
the defense program.

I would like to ask whether the American Federation of Labor has
tftken any action in opening the doors of their unions to Negroes?

A. F. OF L. POLICY TOW^ARD NEGROES

Mr. G REEN. Well, the American Federation of Labor has repeatedly
declared its official policy to be equal opportunity to Negro workers
in securing employment and in learning trades. As a result of that
policy the American Federation of Labor has organized and helped
millions of Negro workers. We endeavor to organize the Negro
workers into our unions just the same as we do the white workers.
Perhaps you know that the American Federation of Labor organized
the Pullman porters.

Mr. OsMERs. Yes.

Mr. Green. And gave it a charter of afliliation with the Amei'ican
Federation of Labor and has cooperated with that organization in all
the efforts it has put forth to secure better wages, improved conditions
of employment and so forth for the Pullman porters.

Now, as to unskilled workers, the one unskilled organization in
the building and construction trade, which is the Hodcarriers Building
and Common Laborers' Union, admits Negroes into membership on
equal terms with the white members and they get the same rate of
pay and are put on the seniority lists — thus enjoymg seniority privi-
leges, just the same as the white members of that union.

Then in many of the building trade organizations the Negro is
admitted as a mechanic- — carpenters, bricklayers. Those are two
organizations that I know of and I know there are many Negro
menibei*s of both organizations in different sections of the coim.try.

Mr. Osmers. How^ever, Mr. Green, we might say that in general
there is no restriction against the Negro but m particular there is a
gi-eat deal of restriction against it. Now, I come from the State of
New Jersey and I am sure that you are aware of the fact that — I
wouldn't say all, but nearly every building trade-union in the State
of New Jersey proliibits Negroes from membei*ship. I don't know
whether they have it in their constitution or not but as a practical
matter no Negroes are members.

Mr. Green. I can't answer that. I am answering what I do know
and I do know that the bricklayers and the carpenters have Negro
members and I know the building and hodcarriers and common
laborers' unions have Negi"0 members. I know they have them in
New Jersey and New York, thousands of them.

FRAMEWORK FOR OPERATION OP ALL UNIONS

Mr. OsMERs. May I ask this question, because it concerns union
organization and is beyond my knowledge:

In the event that one of your locals should exclude a Negro because
of his color does your governing body have any control in such a case
or any jurisdiction?

Mr. Green. The federation hasn't, because the federation is not
an organization — it is a federation of organizations. Each national

^74 WASHINGTON HEARINGS

union is clothed with authority when it is chartered by the Americfin
Federation of Labor, to form its own laws, draw up its o\vti constitu-
tion and administer its own affairs without interference from any other
organization or from the American Federation of Labor itself.

Mr. OsMERS, Shall I put it this way: There is no bill of rights or
there is no framework

Mr. Green. There is no set-up here. Our relationship to our inter-
national unions is just about the same as the relationship of the
Federal Government to the State governments.

Mr. OsMERs. That brings up a point that I have in mind. I just
started to ask whether there is a framework within which all of these
unions must operate? Now, for example, we have the Federal Gov-
ernment and the Federal Constitution provides a framework within
which the States are permitted to operate, but no State in the Union
can go beyond that Federal Constitution.

Mr. Green. Yes; but the President of the United States cannot go
into a State and tell that State what to do either.

Mr. Osmers. No, but if that State should pass a law restricting free
speech or free press or something else that was protected by our
Constitution then the Supreme Court and the power of the Federal
Government would prevent the State from doing it.

Mr. Green. That is because that would affect the Federal statutes
or the Constitution and the same is true with us. Now, in our con-
ventions, to show how we handle that, in our conventions the American
Federation of Labor itself, as I have said, has gone on record repeatedly
in favor of extending to the colored worker equal economic oppor-
tunity with the white workers.

Mr. Osmers. I have read that.

Mr. Green. Now, we have done that. Now, then where a union
affiliated with us adopts a clause in its constitution that is discrimina-
tory against the colored worker and probably provides that only white
members are eligible to membership, then we urge and insist that that
imion eliminate that bar from its constitution. And, secondly, we
say:

"If you refuse to take Negroes, that are covered in your trade, that
are working along with your people in some line of work, into your
organization, the American Federation of Labor will charter them
directly and take them into the American Federation of Labor as a
direct chartered union."

That is the way we meet thati situation.

Mr. Osmers. I was going to ask you another question but you
answered it when you used the word "insist." What retaliatory
measures can you adopt?

race problem remains unsolved

Mr. Green. Of course, you understand, Mr. Congressman, that
we are living in a very realistic world and we are dealing with the reali-
ties of life. We have many problems that are real and we still have
the race problem.

Now, some of us believe there should be no race problem as far as
economics are concerned while there are others that look at things
differently. Now, we can't help that point of view. It is real. But

NATIONAL DEFENSE MIGEATION 6475

we are dealing with it as best we can and fortunately here in America
we have been breaking down that prejudice that has existed for some
40 or 50 or 60 years.

Now, I think if we will all be reasonable eventually we will be able
to overcome these problems, but we can't do it by waving oiu" hands.

Mr. OsMERS. That is true and I appreciate the difficulties that you
meet.

Mr. Green. You imderstand that?

Mr. OsMERS. Yes, sir; because you have something that has come
before this committee on many occasions. Kepresentatives of Negro
groups have come before this committee and said why this company
or this corporation refused to employ Negroes, but upon investigation
we found that the company or corporation involved had absolutely
no feelings on the subject whatsoever, but they reported to the com-
mittee that if they had brought in colored workers into their plants^
that they would have had serious trouble with the white workers who
were then employed.

Of course we get right back to what you said before, we still have a
race problem in tliis country.

Mr. Green. Just that; and some employers unload those things on
then- workers.

AGREEMENT BETWEEN GOVERNMENT AND BUILDING TRADE UNIONS

Mr. OsMERS. Is it true that there is in prospect now the possibility
of a master agreement between the Govermnent and the building
trade-unions similar to the shipbuilding agreement?

Mr. Green. Yes, sir.

Mr. OsMERS. That will cover all of our building trades connected
with national defense?

Mr. Green. Yes, sir; that has been negotiated and as I understand
it is waiting merely this determination, as to whether the situation
requires the issuance of an Executive order in order to make it legal
and effective or whether it automatically goes into effect.

Mr. OsMERS. That would be an extremely desirable tiling, would it
not, Mr. Green?

Mr. Green. It would have a wonderful stabilizing effect.

Mr. OsMERS. I certainly agree that it would, and I express my
personal wish that it is successful.

I concluded because about the only way we are going to be able to
prevent this spiral, that is well started now, from getting out of hand
is through these stabilizing agreements. Of course I read with a
great deal of interest this survey of conditions in defense areas which
you submitted to the committee and as a document it is a valuable
thing to us when it gets down to cases.

There is one thing that impresses me:

All over the United States workers are paying about 30 percent more rent —

just to quote from one place; another:

Within the last 2 months all commodities, services, and rents have gone up.
Rents are exorbitant —

and other quotations.

g476 WASHINGTON HEAlilNUS

ACTION TO MAKE STABILIZING AGREEMENTS EFFECTIVE

Now, is it your opinion that if wc arc to stop migration in the United
States, that the Federal Government is going to have to take action
that will make these stabilizing agreements effective by putting the
damper on the increase of some of these living costs? It is a lot
easier said than done, I realize.

Mr. Green, You know you are dealuig with a very diiRcult eco-
nomic problem when you attempt to deal with price control?

Mr. OsMERS. I appreciate that.

Mr. Green. And the laws which govern economics are very
stubborn. They don't yield to artificial means, and artificial remedies,
very well; so when we go into that field we are trying to accomplish
a very difficult task.

The one thing that in my opinion will tend to keep rents down,
particularly at a reasonable level, would be the development of an
adequate housing program, one that would run parallel with our
mdustrial development and that would, month by month and year
b}' year, meet our housmg requirements.

As long as there is a scarcity of houses, rents are gomg to be high
in that community and nobody can change that.

Mr. OsMERS. They probably would enter mto secret agreements,
over and beyond whatever the Government established, in order to
get living quarters?

Mr. Green. They would, of course. You couldn't control that.

Mr. OsMERS. Sort of a bootleg situation?

Mr. Green. Yes, sir; it is just like there being one apple and every-
body wants that apple. The price of that apple v/iil be affected and
that is the way it is with housing.

I referred to that in my statement and I would request you go into
that. I think I have some valuable information here as to the housing
problem and the need for the development of our housmg program.
That, Mr. Chairman, is one of the economic features that can be
considered as a partial remedy for our post-war difficulties — -the
preparation for the launching of an adequate housing program, when
we see we are approaching the end. It will create work opportunities
not only in the manufacture of material for liousing but in housing
construction.

NO PRIORITIES ON BUILDING MATERIALS

Mr. OsMERs. Do you expect the use of priorities with respect to
building materials?

Mr. Green. No ; I don't think it will ever prevent essential building.

Mr. Osmers. You don't think it will do that?

Mr. Green. I don't think it can afford to do that.

Mr. Osmers. That is ah I have, Mr. Chan-man.

The Chairman. Congressman Arnold?

Mr. Arnold. No questions.

The Chairman. Mr. Green, you have been very patient and very
clear and very able, but there is just one question that I want to ask
you because I am still deeply concerned about what is going to happen
afterward. Now, on page 11 of your statement 1 think is a most
striking statement. Let me read it to you:

NATIONAL DEFENSE MIGRATION 5477

Defense work i.s expected to be temporary. If justice is done to those forced
into it by priorities and if it is to be made attractive enough to induce many other
workers to accept defense jobs voluntarily, these equities should be compensated
for. Unemployment compensation alone, limited as it would necessarily be under
reasonable standards, is not adequate for that purpose.

And you go on to state how inflation can be avoided.

Now, you see, if you as president of the American Federation of
Labor and speaking for that great organization, and if management
could outhne some plan along the lines that you have made in your
statement, there is yoiu' real cushion.

Now, at the San Diego hearings we had a witness who testified that
in Comiecticut the shipbuilding plants would add to the cost of pro-
duction or add to their contracts a reasonable amount to take care
of the unemployed afterward. We went mto Connecticut but we
couldn't find a thing about that. But as I say again, it is the word
"compulsory" that stands in the way. We can't tell them they have
got to save but just as sure as we are here today the cushion is going
to be the savings of the workers themselves.

For that reason they cannot be charged exorbitant rents. They
have to receive a wage out of which they can save somethmg, isn't
that right?

Mr. Green. That is right.

SPECIAL CATEGORY OF SOCIAL SECURITY

i\lr. OsMERS. I want to recall some suggestions that were made to
the committee some time ago and I would like to get Mr. Green's
reaction, now that you have brought that very important point up.

The suggestion was made, and I joined in that suggestion and still
feel the same way about it, that a special category of social security
should be established for people employed in pm-ely defense indus-
tries and that from those workers and from the Government and
from the employer should be exacted a higher percentage from their
salaries than at the present time in civilian life, for the reason that
when this emergency is over these people will not go back to work in
the normal coin-se of things. It will take a longer period of time and
they are entitled to longer social-security payments before relief is
considered, than the normal worker is entitled to. What do you
think of that suggestion?

Mr. Green. There is much merit in that suggestion, I think,
iilthough it would be difficult to differentiate purely defense employ-
ment in many cases, and unemployment will affect all workers in a
post-defense period. All of us, of course, have thought about that
phase of the problem and I was thinking about that when I appointed
a defense committee here about a week ago for the purpose of special-
izing ui national-defense problems, and I am looking for suggestions
myself because I have a clear understanding and a deep appreciation
of the seriousness of the problem, and that ought to be, perhaps, con-
sidered in connection with other remedies to be used in meeting our
post-war problems.

Air. OsMERs. It is very much before this committee because at
the conclusion of the emergency we may see migration in the United
States such as we have never seen before, looking for employment
opportunities.

5478 WASHINGTON HEARINGS

The slightest whisper or rumor will send thousands of people out
across the country somewhere to 50 jobs and we don't want that to
happen. It would be cruel and bitter to these people that have helped
to defend their country, in the plants.

Mr. Green. That is right.

The Chairman. You see, Mr. Green, as we traveled over this
country the one bright spot was that we are not waiting like we did
in the World War No. 1. We are getting on top of it now, by listen-
ing to men like you and others, and if we get the facts first, probably
we will get some solution, but we can't let it go as we did after the
last war.

Mr. Green. No; we can't afford to do that now because economic
conditions have changed, you know, since 25 years ago, and I don't
know whether the country could meet the social strain.

Mr. Osmers. We are in a little bit different financial position than
we were at that time, too.

Mr. Gre£n. That is right.

The Chairman. Well, Mr. Green, I express my own appreciation
and the appreciation of the members of the committee for your
appearing here today. It has been a very valuable contribution and
I hope we have the privilege of hearing you again some time.

Mr. Green. Thank you, Mr. Chairman, and I want to say if we
can be helpful to you further call upon us and we will respond whole-
heartedly.

(The following letter, dealing with subject of post-emergency social
security, was received subsequentlj^ from Mr. Green and accepted
for the record:)

Exhibit B

American Federation of Labor,

Washingto7i, D. C, July 28, 1941.
Hon. John H. Tolan,

Chairman, House Committee Investigating National Defense Migration,

Washington, D. C.

My Dear Congressman: Taking advantage of j^our invitation to extend my
remarks before the House Committee Investigating National Defense Migration,
I would like to develop further the kind of social-security system which we believe
should be created now in order to prepare the Nation to meet the post-defense
crisis.

The problem of employment is clearly shown by the migration of workers to
be a national one, not confined to a single State or section. Post-defense unem-
ployment will be Nation-wide and can be solved only by national measures. With
that in mind we urge the consolidation of the loosely knit and inadequate Federal-
State unemployment compensation sj'stem into a comprehensive Federal program
of social insurance. This comprehensive program should have a single pooled
fund for the multiple insurance benefits, designed to compensate in part for loss
of wage income involuntarily imposed on workers and their families by events
beyond their control, unemployment, old age, premature death, temporary and
permanent disability, and for supplementary payments to cover in part at least
the costs of medical care and hospitalization which would permit workers and their
families to get the attention they need and which is not now within their financial
reach. This fund should be created by the joint contributions of employers and
employees, and a payment from general tax revenues.

The American Federation of Labor has upheld employer contributions alone
for unemployment compensation, believing that workers bear a sufficient burden
in their loss of income uncompensated by insurance and that the expense of unem-
ployment compensation is a legitnnate business expense. We have always sup-
ported the contributory plan for old-age and survivors' insurance. In a compre-
hensive plan, providing for general social insurance which will protect wage earn-
ers and their families against the financial burdens of ill health and disability as

NATIONAL DEFENSE MIGRATION 6479

well as uuemployment compensation we believe workers' contributions are entirely
justified.

The coverage of this comprehensive system must be broadly extended to those
groups of workers now excluded from protection. Special provisions should be
included to protect existing rights or create rights for persons who serve the Nation
in military or civilian defense. The diverse and inadequate provisions of State
unemployment compensation offer little protection against the mass of unemploy-
ment we must prepare to combat at the end of the defense program. Wide exten-
sion of coverage is essential to create an equitable system.

In the midst of waging war, Britain has found it desirable to enlarge and im-
prove its program of social insurance. The morale of the Nation was improved
by the consideration thus given to caring for social needs of its people. We urge
this comprehensive social insurance system for the purpose of creating a better
living for our working people and their families and to give the Nation as a whole
a more adequate defense against the economic and social problems which will
beset it. We need now to get ready to hold up the Nation's purchasing power
when unemployment is general. We need now to protect American families from
the disrupting effect of loss of income when the wage earner is disabled tempo-
rarily or permanently. We need in both peace or war to make it possible for all
our people to save in advance through an insurance program for necessary medical
care. Our road to a healthier, stronger Nation with unshakable morale lies,
through building greater securit}- for our people.

Enlarging our contributory insurance program now would have the further
effect of reducing consumers' expenditures by collecting social-security taxes on
a broader base and creating reserves which will be used when needed later to
sustain consumption and encourage production. With a single pooled fund there
will be greater economy of operations and the wider spreading of risks will make
possible more liberal benefits in relation to the necessai'y reserve. Consequently
benefit payments will have a greater influence on the post-defense period than
would otherwise be possible.

The American Federation of Labor urges Congress to plan for such a compre-
hensive national program, providing for old age and survivors' insurance, with
extra income for medical and hospital care for all workers and] their families,
financed from a single fund built up on a contributory basis by employers, em-
ployees, and the Government. I cannot stress too strongly how important I feel
this program to be to our Nation. Both now and when we again face serious
depression and unemployment we need a national system, soundly financed, and
able to pay benefits which will be adequate to prevent much distress and to keep
our purchasing power from collapsing while we are adjusting our economy again
to a peacetime production. Now while we still have time we should build our
social insurance system into a comprehensive program which will protect us from
economic chaos later. The limited coverage of the present social security law,
its failure to provide disabilit}' insurance and aid for medical care, and especially
the complete inadequacy and confusion of our 51 unemployment compensation
laws make the existing system incapable of doing the job that will need to be
done.

Sincerely j'ours,

William Green,
President, American Federation of Labor.

The Chairman. The committee will recess until 9:30 o'clock
tommoiTow morning.

(Whereupon, at 4 p. m., the committee adjourned until 9:30 a, m.^
Wednesday, July 16, 1941.)

60396— 41— pt. 1(

NATIONAL DEFENSE MIGRATION

WEDNESDAY, JULY 16, 1941

House of Representatives,
Select Committee Investigating

National Defense ISIigration,

Washington^ D. C.
The committee met at 9: 30 a. m., Hon. John H. Tolan (chairman)
presiding.

Present were: Representatives John H. Tolan (chairman), of Cali-
fornia: Laurence F. Arnold, of Illinois; Carl T. Curtis, of Nebraska;
and Frank C. Osmers, Jr., of New Jersey.

Also present were: Robert K. Lamb, staff director; Mary Dublin,
coordinator of hearings: F, Palmer Weber, economist; and John W.
Abbott, chief field investigator.

The Chairman. The committee will please come to order.
Our first witness is Mr. Gill, Assistant Commissioner, "Work Proj-
ects Administration.

TESTIMONY OF CORRINGTON GILL, ASSISTANT COMMISSIONEE,
WORK PROJECTS ADMINISTRATION, WASHINGTON, D. C.

Tlie Chairman. Mr. Gill, I have read your statement with a great
deal of interest, particularly along the line of prevalent opinion in
the LTnited States, that this national-defense program is not going
to take care of all unemployment.

Our committee has found out that is quite accurate and I think
your paper presents some very startling facts and figures along that
line.

Mr. Gill. I wonder if it would meet with your approval if I read
the statement. It is comparatively short.

The Chairman. All right, Mr. Gill, you may proceed,

Mr. Gill (reading). In many respects the unemployed in this coun-
try face a very precarious situation. In the year ahead they will get
reiatiA^ely less help than at any time since the Federal Government ac-
cepted the responsibility of providing jobs for destitute workers.

In still another v\-ay. the unemployed face a bleak outlook. Many
people think the armament program will provide jobs to all who want
to work.

However, the defense program will by no means provide all of the
unemployed with jobs. The remaining unemployed workers will be-
come the object of increasing resentment. The ancient prejudice

6481

5482 WASHINGTON HEARINGS

which held that anyone who wanted a job could get one may again
ride high and become the typical general attitude toward the unem-
ployed.

The great strides taken in the handling of the unemployment prob-
lem in recent years were possible only because this prejudice was
largely broken down. The unemployed, therefore, stand to lose in
two ways: In loss of public employment and in loss of public sym-
pathy and understanding.

"statistically liquidating" the unemployed

There has been a lot of loose talk about reemployment and unem-
ployment since the war started. Judging from some of the statements
made a year ago, there should be no unemployment now. We still hear
such statements about unemployment in the coming year. There has
been too much of a tendency to liquidate unemployment by statistical
calculations rather than bj^ the development of job opportunities.

The statistical calculations started from such facts as these : Indus-
trial production is at a record-breaking level. Feverish activity is evi-
dent in centers of defense production. Employment has increased
sharply. Between May 1940 and May 1941, nonagricultural employ-
ment increased 3.1 millions. In the same period the armed forces
were augmented by 1.2 million. Total industrial production in May
1941 was 32 percent above the 1929 high.

These are the statements one sees in the newspapers. They are true,
but they do not tell the whole story. A full defense effort, as well as
humane considerations, requires the review of all of the facts.

A full defense effort means that we can no longer afford the luxury
of idle men any more than we can afford idle steel or aluminum capac-
ity. The Nation needs the output of every worker. The country can-
not afford the corroding of morale which results from the denial to
large groups of the right to participate in our productive effort and
the right to earn a living. It is a curious paradox that while Hitler is
importing labor we are deliberately denying ourselves the use of a
significant proportion of our labor supply.

After a year of intense defense activiity, total employment in May
was still below the peak of 1929. Agricultural employment was 1.5
million less than in May 1929, and markedly below the seasonal high
of 1929. Nonagricultural employment last May was only 800,000 above
the 1929 peak. Total employment, therefore, is less now than 12 years
ago, but total production is much higher. The rapidly increasing me-
chanical productivity of our industrial plant explains in part the fail-
ure of employment to keep pace with production. Outi:)ut per man-
hour in all manufacturing increased 34 percent from 1929 to 1939.

LABOR FORCE UP 6 0 0,000 NET EACH YEAR

Every year there is a normal net increase of 600,000 in the labor
force. This is a net increase over and above those that leave the labor
market because of old age or for other reasons. Since 1929 the nor-
mal growth of labor supply has amounted to at least 7,000,000
persons. To provide full employment, industry must expand con-
tinuously to offset the disemployment created by technical improve-
ments and to absorb the ever-rising crop of new workers.

NATIONAL DEFENSE MIGRATION 6483

Additional allowance must be made for an abnormal growth of labor
supply during this emergency period. It has been estimated by Mr.
Chester Davis that there were 5,000,000 workers in rural areas in 1940
who were either unemployed or who were too unproductive to main-
tain decent income levels. Some of these workers have already been
attracted into the industrial labor market. Better employment oppor-
tunities and higher wages are also attracting into the labor market
youth who otherwise would have remained in school, housewives who
normally would not work, and older persons who had retired.

None of the published estimates of unemployment makes allow-
ances for this abnormal influx. This deficiency in the figures on
unemployment will become much more serious as the defense program
expands. During World War I, more than 3,000,000 extra workers
were drawn into employment in this way. An abnormal increase in
the labor supply of 1,000,000 during the fiscal year 1942 is a con-
servative estimate.

AVER.\.GE HOURS OF WORK

Average hours of work are also an important consideration. Aver-
age hours declined from about 48 in 1929 to 40 now, a reduction of 17
percent. The reduction helped to maintain employment when pro-
duction was declining.

However, hours are now being increased and this restricts the rate
of employment. The Bureau of Labor Statistics reports that average
hours in manufacturing advanced 7 percent from July 1940 to May
1941. In 17 key defense industries the number of workers in April
1941 was 45 percent greater than April 1940, but the number of man-
hours worked was 62 percent greater. If these industries had not
exceeded the standard 40-hour week, they would have required 204,000,
or 9 percent more workers. There is still ample room for expansion
of output by increasing hours. More than 8,000,000 workers are still
employed less than 40 hours — many of them less than 30 hours.

CONCENTRATION OF CONTRACTS IN 2 0 AREAS

The defense stimulus has been very highly concentrated. Twenty
industrial areas received 65 percent of all prime defense contracts
awarded through June. A very highly concentrated awarding of
contracts was necessary because industrial plants in this country
have been concentrated in a relatively few areas.

These 20 areas contain only 27 percent of the population of the
country and only 23 percent of W. P. A. employment. Eight of these
20 industrial areas with only 18 percent of the population and 16
percent of W. P. A. employment have received 45 percent of all prime
defense contracts. There are 2,300 counties with no direct defense
contracts at the present time.

Even in defense areas, unemployment has not been eliminated. Op-
portunities for jobs have attracted large numbers of workers from
other areas and from farms. Because of age, color, lack of citizen-
ship, or required skills, many persons now counted as unemployed are
unable to compete with these new entrants into the labor market.

The period of very rapid production increase is now nearly over.
From June 1940 to May 1941, the index of industrial production ad-
vanced 24 percent. In the latter month the index was at 150 percent

5484 WASHINGTON HEARINGS

of its 1935-39 average. Standard and Poor's Business Advisory
Service stated on June 27, 1941 :

Whatever the figaire the index eventually reaches, the fact of the matter is
that our production facilities are being taxed at the present time and further
gains in composite production from current levels will be limited by growing
shortages of manpower, materials, and machinery.

Indeed, because of the prospective curtailment in the output of many nondefense
materials, there is some question whether the present index will exceed 360 to
165 percent of the 1935-39 level at any time during the duration of the defense
program.

MATERIAL SHORTAGES, ACTUAL AND THREATENED

Shortages are evident in industry after industry — machine tools,
shipbuilding, shipping facilities, railroad equipment, aircraft, alumi-
num, magnesium, steel, nickel, copper, zinc, neoprene, and others.
Serious shortages are threatened in electric power, gasoline and oil (in
the East), rubber, textiles, and practically all imports. The situation
is rapidly becoming worse. The recent Dun report estimated there
will be a shortage of 6.4 million tons of steel in 1942. Automobile pro-
duction is already scheduled for a 20 percent cut, and most trade au-
thorities doubt that materials will be available for even 50 percent
production.

It takes time to build new plants, to develop new sources of material,
or to train highly skilled labor. Shortages have given rise to official
priorities on many of the above products. The purpose of priorities
is to ration materials when demand exceeds supply. The most urgent
defense needs get first call. What is left is divided among other de-
fense uses and civilian consumjition. The effect of priorities is to .shift
shortages from defense to nondefense j^roduction.

BEARING OF SHORTAGES ON EMPLOYMENT TOEND

The bearing of these developments on the rate of reemployment and
the volume of unemployment is direct and immediate. Insofar as pri-
orities are substituted for new plant capacity, total production and
employment fail to expand. Unemployment is created in nondefense
industries that are unable to obtain equipment and materials. The
prospective cut in automobile production will result in large losses of
employment not only in Detroit but also in garages, service stations,
and retail sales organizations throughout the country.

The Wall Street Journal on June 28, reported that —

One conservative official estimates a 50 percent reduction in automotive operations
this fall would add more than 100,000 workers to relief rolls in Michigan alone.

On June 26, in reporting the results of a survey on the effect of defense
needs on civilian production, the National Industrial Conference
Board said :

Nearly 80 percent of the executives reporting say that they expect to have to
curtail production of civilian goods in the near future. A number of them do
not see how they can continue their present production rates beyond another
45 or 60 days. Executives say they do not see how they can continue to supply
durable goods to civilians in anywhere near adequate volume, in view of the
fact that the 1941 defense program, according to the Offlce of Production Man-
agement is expected to absorb about 64 percent of last year's durable goods capacity
and that the 1942 defense program calls for 6 percent more durable goods than
were turned out for all purposes in 1940.

NATIONAL DEFENSE MIGRATION 6485

In a recent address, Mr. Peter Nehemkis, of the Office of Produc-
tion Management, stated that —

Priority orders have had drastic effect not upon a few concerns but ujion entire
industries. Already not less than 10 entire industries whose supplies have been
either drastically curtailed or completely shut off must either close down or enter
a new line of production.

Indeed, before the end of this summer, we may expect to find one-third of
American industry faced with the grim reality of "guns versus butter."

As the tempo of the wartime economy gains increased momentum, you may
exi>ect to find for a time not less but more unemployment : not less hut more idle
machines.

SHAKE-UPS CAUSED BY CHANGING PRODUCTION SCHEDULES

Employment shake-ups resulting from the forced changes in pro-
duction schedules, transfers, and shut-downs have been numerous.
Workers are transferring to defense jobs, in some cases en masse, as
entire plants shift from nondefense to defense production. The point
here is that defense jobs are being filled by persons who transfer from
one industry to another, and that vacated jobs in nondefense indus-
tries will not be filled. The net effect is that defense labor require-
ments are being met without corresponding increases in total employ-
ment.

Workers being forced out of nondefense industries by priorities and
shortages are not always able to find new jobs. Many such workers
are handicapped because they lack certain required skills or live
in sections of the country where no defense jobs are available.

It should also be emphasized that mere passage of appropriation
bills does not in itself provide jobs. The funds must be spent. Short-
ages of plant capacity, skilled labor, and materials, as well as the tre-
mendous management problem that is involved, mean that there is a
large gap between appropriations and expenditures.

DEFENSE EXPENDITURES AND THE NATIONAL INCOME

Moreover, defense expenditures do not constitute a net addition to
national income because of reductions in income in nondefense lines.
If we assume that cash defense expenditurse for fiscal 1942 will
approximate the 15.5 billion predicted recently by the Director of
the Budget, national income should increase by about 10 billion.

On the basis of past relationships between national income and
employment, a $10,000,000,000 increase in.national income should result
in an increase in employment of about 2.5 millions. On an average
monthly basis, this would be a somewhat smaller rate of increase than
the average of 265,000 a month for the period June 1940 to May 1941.

In translating these employment increases into probable changes in
unemployment, it must be remembered that there will be the nor-
mal net increase in the labor force of 600,000. There will also be a
substantial abnormal increase. Many of the new jobs will go to these
induced entrants who are not now counted as unemployed.

ESTIMATE or DECLINE IN UNEMPLOYMENT

We are of the opinion that the average decline in unemployment
during the fiscal year 1942 will not be more than 1.5 million, and that

5486 WASHINGTON HEARINGS

total unemployment will probably average about 5 to 5.5 million. The
Work Projects Administration will be able to provide jobs for only
1,000,000 of these unemployed persons.

Of this number, some 250,000 will be employed on projects certi-
fied as necessary for national defense. In addition, the W. P. A.
will further the defense program through an expanded training
program. It is a well-known fact that in many defense centers short-
ages of trained labor have developed. In the past fiscal year the
W. P. A. training program has offered training to 115,000 j^ersons;
of the 80,000 who have completed training, about 65 percent have
obtained jobs.

At the present time we are developing an additional program
of in-plant training, under which workers will go into plants
and receive training on the job. They will be paid by the W. P. A.
At the end of the short training period — usually limited to 4 weeks —
they will be terminated by the W. P. A. and placed on the employer's
pay roll. A short statement on the W. P. A. training progi'am will
be inserted in the record.

Since roughly 5,000,000 will be unemployed during fiscal 1942 and
since W. P. A. will be employing only 1,000,000 of these, there is
no possibility of a general labor shortage. Such shortages as occur
will involve highly skilled occupations and will be confined to cer-
tain localities. In the farm labor field, we are cooperating with
the Department of Agriculture in an effort to insure that the con-
tinuing surplus of farm labor will be available at the right times
and places. More detailed statements on labor shortages and on
the effect of the defense program on unemployment will be inserted
in the record. [Reading ends.]

(The following supplementally statements were introduced by the
witness for the record:)

SUPPLEMENTARY STATEMENTS BY CORRINGTON GILL, ASSISTANT
COMMISSIONER, WORK PROJECTS ADMINISTRATION, WASHINGTON.
D. C.

The Effextt of the Defense Pbogram on Unemployment

There is a widespread impression tliat the problem of unemployment and
need is rapidly disappearing under the impact of defense expenditures. The
effect of the defense program on unemployment will depend upon (1) the
extent to which production increases; (2) the amount of employment that is
provided by this increase in production; and (3) changes in the labor supply
The level of output will deteiynine the volume of employment. There are
various obstacles to increases in output that operate as drags on the rate of
reemployment. It is the purpose of this analysis to outline these various
obstacles in order to suggest why the transition to full employment cannot be
achieved within a few months, in spite of the billions that have been appro-
priated for armaments.

FACTORS affecting EXPANSION OF OUTPUT

Bottlenecks.

The level of industrial production during fiscal 1942 will be seriously affected
by bottlenecks. The placing of approximately $20,000,000,000 of orders for
armaments on top of existing demand has resulted in capacity shortages in
certain crucial fields of production. Bottlenecks already exist in the following
fields; machine tools, shipbuilding capacity, shipping facilities, skilled labor,
plane engines, steel, aluminum, magnesium, nickel, neoprene, zinc, and copper.
Bottlenecks are likely to appear in certain other fields, including railroad equip-
ment, electric power, and imports from the Far East.

NATIONAL DEFENSE MIGRATION 6487

Since production has reached capacity in the important fields enumerated
above, further substantial increases in industrial output must wait upon addi-
tions to plant and upon measures to increase the supply of certain essential
raw materials (especially minerals, such as copper, nickel, and zinc). The
interdependence of industrial activity diffuses the effects of delays due to bottle-
necks and the result is a general drag upon expansion of output.

Sieel has been called "the needle s eye through which the country's whole
economy has to pass." The first Dunn report holding steel capacity to be ade-
quate has already been supplanted by a second report predicting a deficit of
1.4 million tons in 1941 and 6.4 million tons in 1942. Dunn's estimate of the short-
age is probably still too low. All indications are that civilian consumption of
steel will be severely restricted.

On March 1, 1941, the Federal Power Commission said that the electric
power industry should increase its proposed expansion of generating capacity
by more than 26 percent during 1942. The Commission implied that thus far
the industry has far underestimated the demands which will be put upon it
and warned that continuation of this underestimation might bring serious
trouble. Since the Commission's study was completed, both the defense pro-
gram and aid to Britain have bseu expanded. Moreover, it takes from 18 months
to 3 years to install generating facilities and the current backlog of unfilled
orders for electrical equipment may prevent installation at the normal rate.

Capacity operations have been reached in a growing number of raw-material
industries. Supplies of critical materials are being expanded but indications
are that there will not be enough of these materials to meet both civilian and
defense needs. Production of consumer goods will probably be affected to an
increasing extent with a resultant drag on the rate of reemployment.

There have been no significant additions to the supply of skilled metal-
workers, machinists, and tool-and-die makers. Many of the thousands of skilled
workers who will be sought during the next few months will not be available
unless there are radical new developments in training, upgrading, and simplifica-
tion of production processes.

The problem of obtaining expansion of capaeity.

Delay in obtaining the required plant expansion arises basically from the fear
of excess capacity during the postdefense period. To the extent that the ex-
panded facilities are not required for peacetime production during the post-
defense period, private capital invested in defense plants will be subject to
losses. The problem, therefore, is to persuade businessmen to act in terms of
an expanding economy.

The difficulty of expanding capacity is also related to the monopoly question.
Concentration and monopoly play important roles in determining the volume of
investment, and such conditions are especially pronounced in certain fields where
plant expansion is required by the defense program. In industries dominated
by one or a few coriwrate giants with high fixed costs, investment decisions
are made with more than ordinary hesitation and deliberation. Sentiment is
apt to be strongly on the conservative rather than the expansionist side. Plant
expansion that threatens at some future date to disturb the value of existing
properties because of excess capacity is likely to be retarded if not entirely
avoided, even though such investment promises favorable returns over the next
few years. Concentration is especially pronounced in certain fields where expan-
sion of capacity is urgently required if schedvdes of defense production are to
be met.

Last summer, defense production was postponed until Government and industry
coidd agree on means to bring capital into the defense program. Irretrievable
months of time were lost while an amortization policy was formulated that would
be satisfactory to business interests. In spite of the arrangements adopted, the
required amount of plant expansion has not been obtained. Much larger expan-
sion is both necessary and possible. The question is whether more time will be
wasted by another protracted period of bargaining with private investors over
terms.

Piioiities.

Skyrocketing defense demands for such materials as aluminum, chromium, zinc,
and steel has begun to create an acute shortage of these cnicial materials. Such
slaortages have given rise to official priorities. The Priorities Division of the
Office of Production Management has imposed industry-wide mandatory control
over 14 materials and classes of materials. Inventory control is exercised over
15 metals and classes of metals. The priorities critical list contains approxi-

^488 WASHINGTON HEARINGS

mately 300 items aud classes of items on which Army and Navy orders can auto-
matically be giveu priority.

Priorities are the alternative to expansion of capacity; their purpose is to
ration materials when demand exceeds supply. The most urgent defense needs
(planes and ships) get first call; other defense uses then receive allocations.
Civilian demand is met as far as possible out of the remaining supply.

Civilian production is already being seriously affected. More and more busi-
nessmen are waking up to the fact that while business is good, supplies are short.
Rationing is incrensing all along the line. To a greater and greater extent,
materials and supplies that would normally be used in the production of durable
consumers' goods are being diverted to the production of armaments.

On May 28, the Wall Street Journal reported that "Side by side with booming
defense plants are others which are slowing production, operating in fits and
starts, laying off workers. Especially hard hit have been small enterprises."

On June 17, an OflSce of Production Management official reported that as much
as one-third of American industry may be faced with the necessity of closing down
before the end of summer if means are not found to utilize their facilities for
defense production. Not less than 10 industries have had their supplies either
drastically curtailed or completely shut off. This oflBcial said that we may
expect to find for a time not less but more unemployment ; not less but more idle
machines.

Efforts are being made to find substitute materials in order to meet civilian
demand. In cases where satisfactory substitutes are not available, plants are
seeking to obtain subcontracts for defense work. Such shifts mean simply a
diversion from civilian production ; they obviously limit the amount of
reemployment.

Important industries faced with slowdowns or shutdowns include automobiles,
washing machines, refrigerators, radios, vacuum cleaners, and air conditioners.
The reason is that durable consumers' goods are made of the same materials a?
ships, tanks, giuis. and airplanes, and there is not enough of such materials to fill
both needs.

STEEL AND THE AUTO CUKTAILMENT

Steel is the most widely used of metals. It enters into the manufacture of
thousands of products. On June 13, the Ofii^e of Production Management advised
13 companies that they should curtail production of sheet and strip steel for
nondefense purposes and use strip-mill capacity thus released to turn out more
plates for shipbuilding, railroad cars, and other urgent defense needs. Such di-
version will be at the expense of automobiles, refrigerators, and other products
that use flat-rolled steel.

Of the 20 percent forced reduction in automobile production scheduled for
August, the Wall Street Journal says that "Thousands of auto workers will have
about 5 months of standing idly on street corners. Defense lobs won't be ready
for them until the end of the year." While the Ofiice of Production Management
has thus far requested only a 20-percent curtailment. Business Week reports that
manufacturers do not expect to finish the 1942-model year with more than 50
percent of the in41-m()del output. Further cuts will be imposed by the Office of
Production Management in order to assure the availability of scarce materials
that are necessary for defense purposes.

Diversion of metal from nondefense uses is expected to check the increasing con-
sumption of steel in private building. Priority ratings are expected to hit pri-
vate dwellings, apartments, theaters, and shops.

Early this month Iron Age stated in an editorial that "curtailment in civilian
steel shipments far beyond anything imagined a short time ago is being forecast.
* * * S'ime mills estimate that as h'gh as 60 percent of new orders are linked
directly or indirectly to defense needs."

Aluminumware companies that have been unable to shift to defense production
(or to products made from other metals) have reduced employment to as low as
25 percent of normal. Manufacturers of radios expect curtailment of output com-
parable with that faced by automobile companies. The Army ficures that a four-
encine bomber uses as much aluminum as goes into the manufacture of 60,000
coffee percolators or more than 30,000 kitchen utensils. Defense needs for alumi-
num in June were expected to take from 05 lo 100 iiercent of all the metal avail-
able, including scrap.

Present predictions are that there will be insufficient gasoline fm the east
coast to supply civilian demand because of the transfer of 50 tankers for aid to

NATIONAL DEFENSE MIGKATION 6489

Britain. Any curtailment of the use of automobiles will be reflected iu the em-
ployment provided by the network of related service and supply industries.

Because of shipping uncertainties and in order to assure the completion of
adequate stock piles, the Office of Production Management has ordered a cut in
the use of rubber. Rubber is to be rationed to processors iu amounts almost 25
percent less than they are presently consuming. Sharp curtailment of the manu-
facture of tires and thousands of other civilian items made from rubber is
inevitable.

It is becoming increasingly clear that such results are involved in the rapid
shift from civilian to defense production. Use of priorities veill continue to
broaden ; more and more industries must obtain a defense rating or gradually
be shut off from supplies of materials. The consequent curtailment of civilian
production is one of tlie primary reasons why the vast expansion of employment
that has been predicted for this next year will not materialize.

Curtailment of civilian-goods output could have been largely avoided by earlier
expansion of capacity in bottleneck areas. But industry has been reluctant to
expand. As defense output increases during the coming fiscal year, additional
civilian-goods industries will be forced to curtail output and employment because
they cannot obtain materials. To the extent that the li.st of priorities is expanded,
mcreases in armaments production will be at the expense of civilian production
so that increases in arms output and employment will not be net gains. For
tills reason, total employment will increase more slowly.

Now that priorities have been resorted to, there is the further danger that
emphasis will swing from addition of new plant capacity to shifts in the use
made of existing plants. If. instead of building new plants to meet the increased
demand, plants now engaged in producing civilian goods shift to the manufacture
of armaments, the effect will be to freeze output and employment at a point far
sliort of potential capacity, and a large volume of unemployment will persist
even at the height of the defense program.

Frictional maladjustm ents.

Certain optimistic estimates of reemployment for fiscal 1942 have failed to
make adequate allowance for certain inevitable frictional maladjustments: (1)
The Nation's industries that have been geared for satisfying only peacetime
needs must quickly be redirected to produce a maximum of armaments, and
such adjustments are time consuming; (2) the difficulties of bringing all
available capacity into defense productiou involve a tremendous management
problem; (3) and the accumulation of excessive inventories (to guard against
price rises and shortages) means maldistribution of scarce materials and delays
in the expansion of total outptit.

Structural adjustments ore time con-sunihtfj. — To a large extent, the demand
for armaments means that American industry is called upon to produce new
products. In many cases, the handling of defense contracts involves only rela-
tively simply conversions — swords can be made in plow factories. Any shift in
the direction of production, however, inevitably involves maladjustments that
are time consuming. Because tanks and locomotives are both heavy vehicles
made of steel, it is far too easy to assume that a shop experienced in making the
one can turn to the other.

Eventually, machine guns will be produced by companies formerly manufac-
turing such products as refrigerators, gears, electric lights, and spark plugs.
But numitions are infinitely more complex than peacetime machines, and very
few of them lend themselves readily to the methods of the assembly line.

Unaccustomed materials and parts must flow in vast quantities along new
routes. Innumerable frictions and delays naturally develop iu this flow. Delays
in the arrival of new equipment and shortages of materials have the effect of
postponing hirings. Even after the initial toollng-up is accomplished, and large-
scale production of armaments has begun, 'bugs" creep in. New plants are com-
ing into production month by month, and production in these individual plants
cannot be expected to move smoothly at the outset.

The concentration of defense production in comparatively few areas has raised
serious problems concerning the geographical availability of labor. Enormously
expanded production and employment in these few areas means the hurried
transplanting into congested centers of thousands of people. Great housing
projects must be undertaken, and the necessary community services must be pro-
vided for these new populations. Labor turn-over becomes excessive because
workers are unable to find satisfactory living quarters for their families, and

g490 WASHINGTON HEARINGS

this reduces output. At the same time, in other communities many productive
facilities are only partly used and labor is unemployed.

It is problems of this sort that are involved in the statement that structural
adjustments are time consuming.

Difficulties in hringing all available capacity into operation. — The bulk of de-
fense contracts has been awarded to a comparatively small number of industrial
concerns. Orders have been piled on the larger concerns for at least two reasons :
(1) They have the facilities and established managerial ability to handle large
orders; (2) it is easier to deal with a limited number of large concerns than with
thousands of smaller ones. It would probably have taken month.-! longer to break
contracts down into parts and negotiate with numerous smaller concerns. The
Army and Navy turned to the manufacturers whom they had previously done
business with. That was the quickest way to get started.

Thus, while 511 concerns received prime contracts of $100,000 or more during
the last half of 1940, 114 of these accounted for 95 percent of the total ($6,700,-
000,000 out of $7,000,000,000). Sixty-eight companies had received about two-
thirds of the $14,200,000,000 of defense contracts let by March 14.

Estimates made for the Ofpce of Production Management indicate that more
than 200,000 primary contractors are available for defense work. By last March
scarcely more than 13,000 had received orders. By the end of May more than 76
percent of defense contracts had gone to 12 States, while 4 Stf^tes (California,
New York, New Jersey and Michigan) had received $4,500,000,000, or 40 percent

Tlic farming-out prol)letn. — Further substantial increases in the output of
armaments depends not only upon expansion of capacity in bottleneck areas, but
also upon enlistment of a much larger proportion of available productive facilities
in the defense effort. The Nation has scores of giant companies, but it also has
many thousands of small metalworking companies. The companies that have
I'eceived defense contracts represent only a small proportion of the country's
productive equipment and labor supply that could be adapted for defense pro-
duction. If we are to produce the volume of armaments of which we are poten-
tially capable, it is essential for defense work to be more widely dispersed.

The obstacles to bringing idle facilities into defense production are numerous.
The work may be unfamiliar, even to the prime contractor. The bottleneck
parts are sometimes the most difficult to make. As in the case of airplane engines
and machine tools, standards may be exceedingly precise. Many primary con-
tractors do not know where to find concerns to which to subcontract parts. And
many small concerns do not know how to get subcontracts or what kinds of
parts are required that are within their capacity to make. Innumerable time-
consuming subcontractual arrangements are necessary. Problems of equipment
and financing must be solved. New management relations must be established.
Farming out is often more expensive than producing in the home plant. Large
concerns that have received defense contracts are naturally reluctant to share
their profits.

The utilization of smaller plants to fill defense orders has been slow to be
achieved. This is a considerable part of the explanation why expansion will
proceed at a slower and slower rate.

Accumulation of excessive inventories. — Another type of frictional maladjust-
ment is the accumulation of excessive inventories. Stocks have been accumu-
lated against possible price increases and against possible future shortages and
priorities.

By last February, forward buying had begun to intei'fere with the flow of
materials for defense needs. The retarding elTect of genuine shortages has been
exaggerated by the creation of artificial shortages. The introduction of priori-
ties in certain industries was hastened by this situation.

THE VOLUME OF EMPLOYMENT

The effect of itvereasing productivity.

For many years, technological improvement has been fairly continuous. In
industry after industry, the manpower required per unit of product has been
constantly reduced. This means that a thousand tanks, a hundred ships, or a
million uniforms require fewer workers to produce than was I'equired 10 years
ago and many fewer than was required 25 years ago.

Man-hour productivity in all manufacturing was 40 percent higher in 1940
than in 1929. In the railroad industry, the increase from 1929 to 1939 was 40

NATIONAL DEFENSE MIGRATION

6491

percent ; in electric light and power, 76 percent. In the iron and steel industry,
output per man-hour increased 166 percent between 1919 and 1939. Productivity
has also increased in agriculture. Recently, the Department of Agriculture
stated that "normal requirements in farm production * * * can now be met
by approximately 1,600,000 fewer workers on farms than in 1929 * * *."

Manufacturing production increased 32 percent between January 1929 and Jan-
uary 1941 while manufacturing employment increased only 14 percent. Employ-
ment lagged behind production to this extent in spite of a decline in average
hours worked per week from about 48 to about 40. If hours had not declined
during this period, employment would have lagged still further behind
production.

Although there are more persons in the labor supply in 1941 than in 1929, we
need fewer workers to produce a given quantity of real income. During the
course of the defense program, the production of goods will reach higher and
higher record levels. But because of increased productivity, employment will not
keep pace with this increased output.

The factor of part-time employment.

There is an additional reason why employment may be expected to lag behind
production. Increased production is being achieved by lengthening the hours
worked by those already employed. In April there were 4,200,000 workers em-
ployed less than 30 hours per week ; 8,100,000 were employed less than 40 hours.
Plants now on part time will employ their workers for a full workweek before
they add new workers to pay rolls. If hours of labor were to increase to the 1929
level, production could increase at least one-fifth above the 1940 average without
the employment of any additional workers.

The Bureau of Labor Statistics has attempted to calculate the total number of
man-years of labor that defense appropriations will require. Such a total, how-
ever, will not mean a corresponding increase in the number of workers employed.
For example, defense contracts totaling $1,000,000,000 may mean .")00,(X)0 man-years
of employment, but this does not mean that 500,000 new workers will be added
to pay rolls. Instead, a substantial part of these 500,000 man-year? of employ-
ment will be allotted to workers already on pay rolls by lengthening the workweek.

Employment in defense industries.

Employment in the 15 key defense industries in April 1^1 and the percentage
of total nonagricultural employment represented by each were as follows :

Industry

EmplojTnent
in key defense

industries,!

April 1941

Percentage
of total nonl
agricultura -
employment

44,800
166, 100
157, 800
89 600
50, 600
29, 900
13,400
29,900
18, 100
34, 300
118, 200
506,000
326, 900
560, 000
34, 300

Aircraft and parts (exclusive of engines)

Machine-tool accessories

.08

Instruments (professional, scientific)

.05

Brass, bronze, and copper products

Electrical machinery ^apparatus and supplies)

Blast furnaces, steel works, and rolling mills

1 49

.09

Total

2, 179, 900

5 79

• Excludes employment in explosives, ammunition, and firearms industries, as these figures are not being
ma''e public. Employment in Government shipyards is also excluded. In April, Government yards
employed 144.030. or 0.38 percent of total nonagricultural employment.

It is apparent that defense industries employ only a small proportion of all
workers. Very large gains in these industries will not greatly affect the
volume of unemployment.

Future labor requirements for aircraft, machine tools, and shipbuilding have
been estimated by the Bureau of Labor Statistics. In the aircraft industry,

6492 WASHINGTON HEARINGS

employmeiit iu plants ot tinal assembly totaled 217,000 ou March 31. (This
includes manufacture of all parts — frames, engines, propellers, etc.) Peak
employment of 405.300 is estimated for November 30, 1941.

In the machine-tool industry, it is expected tliat 22,600 additional wage-
earners will be employed between January and December 1941, bringing the
total number of wage earners to approximately 102,800. In shipbuilding,
the present schedule will require a continuous increase in the number of
workers until peak employment of approximately 560,000 is reached in Sep-
tember 1942. Ship construction constitutes the largest single category of
defense activity— 36 percent of total contracts awarded through March. Em-
ployment in this large segment of the defense program has expanded very
slowly thus far. Yards have been working at capacity level for some time.
New construction facilities require considerable time to build.

Small as these prospective employment increases are in terms of total
employment, it is qitestionable whether such schedules can be met because
an exceptionally high proportion of skilled workers is required in defense
industries. During last November and December, 12,000 defense employers
were canvassed by the Bureau of Employment Security regarding the types of
workers they expected to hire. Forty-four percent were to be in skilled
occupations, 33 percent in semiskilled occupations, and only 23 percent in
unskilled occupations. The proportion of skilled workers employed in ship-
building and machine tools is 48 percent and 46 percent, respectively.

Indirect employi)ien t.

From the above figures on direct employment in defense industries, it is
apparent that it is in nondefeuse industries that the bulk of reemployment
must come during the next 12 months if certain widely quoted estimates are to
be realized. Throughout this report the position has been taken that these
estimates are too optimistic, and emphasis has been given to the impeding effect of
such factors as bottlenecks, priorities, and frictional maladjustments. There are
additional factors of a more technical sort that will restrict the amount of indirect
employment.

Indirect employment will arise through the spending and respending (by
the recipients) of the funds originally disbursed by the Government. The
volume of this respending will be reduced at each successive round by various
"leakages" (notably savings).

It is at this point that the question of prices and pi'oflts is relevant. If
prices rise, there will be a disproportionate expansion of profits. This always
happens. Even with stable prices, however, profits will increase as output
rises because overhead costs per unit decline with increasing volume of output.^
Higher profits will increase savings. Savings are "leakages" — funds received
from the spending stream and not returned. They reduce each successive
wave of respending of defense funds and hence they reduce the total volume
of employment created by defense expenditures. Savings will thus be a serious
drag on the rate at which indirect employment is created iu uondefense
industries.

Rising prices will also restrict the rate of reemployment by retarding con-
sumption, since wages as a whole inevitably move upward more slowly than
prices. A i-ising price level therefore, will slow up expansion of output and
employment in consumer-goods fields where the greatest excess capacity exists.

Other factors that threaten to keep down the volume of indirect employment
lie in the field of fiscal policy. For instance, if consumption taxes are resorted
to extensively in the near future, a considerable part of the rise in consumers'
incomes would be diverted to the Treasury and the current rate of expansion
in nondefense fields would slow down. Furthermore, the Treasury has an-
nounced that efforts will be made to borrow several billion dollars from con
sumers during fiscal 1942. Borrowing from this source in any stich volume
must be taken into account in estimating the leverage elTect of defense expendi-
tures in creating indirect employment.

1 That profits have already increased .substantially is evident from data for 1940. Ac-
cording, to the Department of Commerce, corporate profits reached the highest level since
li)29. Net incomo of mantifacturhig corporations exceeded 1039 by about .SO jiercent with
the metal and metal-products group up more than 50 percent. In the steel industry, 1939
profits were doubled despite the fact that the average rate of production was only 78
percent. Durable-goods industries as a whole registered an increase of 66 percent.
Profits are expected to be considerably higher in 1941 in spite of rising costs and taxes and
the fact that special reserves are being sot aside in expect.'ition of additional taxes.

NATIONAL DEFENSE MIGRATION 5493

Emploiiinent per million of added income.

The past relationship between increases in national income and incieaseK
in nonagricultiiral employment throws light upon the volume of reemploy-
ment that may be expected during the next 12 months. From 1934 through
1940, between 190,OCO and 304,000 workers were reemployed for each billion-
dollar increase in national income. Therefore, if past experience is any indi-
cation, we can expect employment to increase between 200,000 and 300,000
lor each billion-dollar increase in national income that occurs during 1041.

This type of calculation is useful in providing a general limit to the volume
of reemployment that can be expected. For example, if national income increases
to S2 billion for calendar li)41, this 8 billion increase may mean that reem-
ployment will be as much as 2.4 million (i. e., at the rate of 300,000 per billion
of added income) or as little as 1.6 million (at the rate of 200,000 iDer billion).
If national income increases as much as 10 billion this year the employment
increase may be expected to range between two and three million.

These are the limits suggested by the experience of the last 6 or 7 years.
But since experience indicates that reemployment per billion of added Income
falls off as total national income increa.ses, and since the national income
is already at an all-time high (when adjusted for price changes), it seems
reasonable to assume that the rate of reemrloyment this year per billion of
added income will be closer to 200,000 than to 300,000.

A reasonable estimate of the possible increase in national income during
1941 (eight to ten billion) indicates a maximum reemployment of approximately
2.5 million.

THE VOLUME OF UNEMPLOYMENT

Whatever increases occur during fiscal 1942 in the volume of employment
will not be refl >cted in corresponding reductions in the volume of unemployment.
The major reason for this lies in certain dynamic aspects of the labor .supply.
In the first place, the normal increase in the labor supply amounts lo about
(500.000 woi'kers annually. For this reason alone, an increase of 2 million in
total employment during fiscal lt)42 would mean a reduction in unemployment
of only 1.4 million.

Additional allowance must be made for abnormal growth of the labor supply —
for so-called induced entrants. It is practically certain that employment increases
resulting from th? defense program will be accompanied by a considerable net
increase in the active labor supply. From 2 to 3 million surplus farm workers,
counted as employed in agriculture, are ready to seek employment in urban
industries wlien jobs are available. Better employment opportunities and higher
money wages should bring into the market a large number of youths who have
continued in school because they could not get a job. Similarly, many women
not normally seeking jobs will be attracted into the labor market. None of these
types of workers is included in current unemployment estimates and yet they very
clearly constitute immediately available labor. Large numbers of new workers
from such sources will secure jobs, thus diminishing the effect of gains in em-
ployment upon the supply of workers now counted among the unemployed.

In short, there is a huge reserve of potential workers (not now counted as
members of the labor supply) who will seek jobs as employment opportunities
increase. If the same proportion of the population aged 14 and over enter the
labor market as in 1929, a potential labor supply of at least 60,(X)0,0OO is indicated.
This is approximately 7,000,000 more workers than the labor-supply figure shown
by the preliminary census reports for April 1940, and approximately 12,000,000
more workers than were employed in April 1941.

It follows that caution should be exercised in translating estimates of probable
increases in employment into estimates of probable future decreases in unemploy-
ment. The marked employment gains that are in prospect may well be offset
in considerable part by sharp gains in the total supply of labor offered in the
market. Such evidence as is available indicates that there was an abnormal
increase in the labor supply during the World War of at least 3,(100,000.

THE RATE OP EXPANSION WILL SLOW DOWN

There are a number of reasons for expecting that the rate of expansion of
output and income under the defense program will tend to slow dovsm. Pro-
duction gains were most rapid during the first few months when idle capacity
was being absorbed. Capacity operations have now become a limiting factor in

g494 WASHINGTON HEARINGS

certain crucial areas. Aside from whatever progress is made in farming out
defense orders, the pace of future advance will be geared to the completion of new
facilities, especially in the metals, machine-tool, and finished-armament industries.
Additions to capacity take time to complete and will slow down the pace of the
upswing. Additions to basif' capacity in the steel industry, for instance, require
over a year to complete and a decision to increase steel capacity by a significant
amount was not made until June 194L

The levels reached by production and employment will also depend upon the
ability of industry to become organized at a higlier and higher pitch. With
production already at the highest rate in history, and with bottlenecks evident
in several key industries, the problems of organizntioii (of the labor supply, of
materials, and of plant expansion) to achieve higher levels become increasingly
difficult,

CONCLUSION

The defense program might be expected to release the Nation's full potential
capacity to produce. According to policy pronouncements, we are determined to
get production at any cost. Presumably, the measures taken to further the
defense program will look toward maximum production rather than the protection
of vested interests. The quantity of output has become the dominant considera-
tion rather than the cost to individuals.

Tbe rate at which output rises does not depend upon the volume of appropria-
tions but upon the organization and control of Anifrican industry. Certain out-
standing obstacles to rapid expansion have been discussed in this report. Insist-
ence upon maximum production has been slow in being translated into action.
The required measures for proper coordination and control have been slow in
formulation and slow in becoming accepted as essential to an adequate defense
program.

The achievement of full employment and maximum utilization of resources
is not an immediate prospect. After reasonable allowance for all stimulative and
restrictive factors in light of present knowledge, it appears that unemnloyment
cannot be expected to decline more than 1 or 1..5 m'lUon during fiscal 1942. In this
case unemployment in the year ahead will probably average between 5 and 5.5
million.

THE TRAINING PEOGRAM OF THE WO"K PBO.TECTS ADMINISTRATION

During the last fiscal year the Work Projects Administration has participated
in an extensive vocational school training program to prepare workers for manual
occupations in industries engaged in national-defense operations. Over 115,000
certified Work Projects Administration workers have or are receiving training in
these courses. Of the SO.OOO who have completpd trnining, over 65 percent nre in
private jobs and the others represent a reservoir of labor ready for employment
as opportunities develop in the areas w^^ere tlie trained workers res'de About
35,000 persons are in training in over 6.".0 different communities in all 48 States.

This training program has been conducted in cooperation with the vocational
schools wh'ch have b-^en responsible for the technical instruction given. The
OflBce of Production Mnnagement has been the sponsor of this project and the
United St^ates Office of Education has been cosponsor.

In addition to the vocational school program, there has been developed by the
Work Projects Administrntion, on an e^'perimental basis, an in-plant training
program for giving preemployment instruction to certified persons prior to their
transfer to the employers' pay rolls. For a short period, usually limited to a
maximum of 4 weeks, certified persons are trained on equipment and under
conditions as comnarable as possible to those existing under shop operations.
Factories provide the facilitips and supervision. Tliere is a brief period of pre-
employment instruction and observation by the plant's officials, and at the end
of the training period the trainees are terminated by the Work Projects Adminis-
tration and are taken onto the pay rolls of employers and placed in productive
employment.

On both of these programs the trainees continue to receive the security wage
from the Work Projects Administration until they have completed the course
of training. It is anticipntod that both of these training programs will be
substantially exiianded during the coming year.

There are operated, in addition, special training programs designed to serve
the same purpose ; namely, the return of certified persons to private or other

NATIONAL DEFENSE MIGRATION 6495

public employment. These include the training of men for airport service jobs
and the training of household workers. It is anticipated that they will be
developed and expanded as opportunities for placements develop.

In addition to the training programs, the Work Projects Administration utilizes
all facilities in the community, such as employer organizations, growers' associa-
tions, public employment services and individual employers for placing certified
persons directly in private employment. This program will be undertaken on an
extensive scale during the current fiscal year.

The Distribution of Dffense Contract Awards

The allocation of defense contracts continues to be highly concentrated,
despite attempts to distribute them more widely. A few industrial areas have
received very large contract totals, while many other areas have received
little or no direct stimulation.

Twenty industrial areas, with only 27 percent of the population and 23
percent of the Work Projects Administration workers, received about 65
percent of the prime defense contracts through June 30, 1941. Eight industrial
areas which have received 4.5 percent of the defense awards contain only 18
percent of the population and 16 percent of the Work Projects Administration
workers.

Warship construction and aircraft manufacture, contracts for which totaled
over .$8,000,000,000 through June 30, 1941, are mainly responsible for this high
concentration. A large proportion of the total prime contracts are for warships
or aircraft in 16 of the above 20 industrial areas. The innnediate effects of
these large orders upon employment can be easily exaggerated. In many
instances the construction of numerous shipways and airplane plants must be
completed before the full magnitude of defense orders can be translated into
employment gains. Moreover, in some areas (typically Detroit), defense orders
will not represent a net increase in total business because material priorities
will cut deeply into certain important types of nondefense production.

The attached table .shows the concentration of prime defense contracts hy
industrial areas in relation to population and Work Projects Administration
employment.

Prime defense contracts, 1940 population, and Woj-k Projects Administration
employment, hy industrial areas

Industrial area '

Continental
States

New York City-New-
ark-Jersey City

Philadelphia-Camden...

Boston

Norfolk-Newport News_

Los Angeles

Detroit

Seattle-Tocoma

San Francisco-Oakland.

Prime defense contracts
cumulated from June
1, 1940, through June
30, 1941 2

Amount
(000)

$15, 025, 358

1, 669, 052
1, 480, 920
881, 283
713, 605
651, 359
584, 614
422, 639
348, 720

Per-
cent

Cumu-
lative
percent

31.6
35.9
39.8
42.6
44.9

Population 1910 3

Number

of
persons

3,275

10, 782, 353
3, 199, 637
2, 656, 131

285, 246
2, 785, 643
2, 209, 691

687, 061
1, 412, 686

Per-
cent

Cumu-
lative
percent

8.2
10.6
12.6
12.8
14.9
16.6
17.1
18.2

Employment on proj-
ects financed with
W. P. A. funds as of
June 25, 19414

Number

of
persons

1, 333, 364

99, 712
22, 547
35, 885

1,971
16, 233
17,710

6,018

Per-
cent

Cumu-
lative
percent

7.5
9.2
11.9
12.0
13.2
14.5
15.0
16. „

1 Industrial areas as defined by the United States Bureau of the Census in the Biennial Census of Manu-
factures, 1937, Part I, pp. 40-4) . Where no definition is given by the Census, industrial areas are as defined
by the Bureau of Research and Statistics, Office of Production Management, in release of April 29, 1941.

» Source: Office of Production Management, Bureau of Research and Statistics: "Summary of Defense
Contract Awards by Industrial Area, June 1, 1940, to June 30, 1941" release of July 14, 1941. Includes prime
defense contracts awarded by the War and Navy Departments and project orders to Army and Navy
establishments of $10,000 and over. This tabulation reflects not only the awarding of new contracts but also
the reassignment of contracts to other plants or companies and the modification or cancelation of previous
awards.

> Source: Department of Commerce, Bureau of the Census.

« Subject to revision.

60396— 41— pt. 16-

-13

6496

WASHINGTON HEARINGS

Prime defense contracts, 19/fO population, and Work Projects Administration
employment, hy industrial areas — Continuetl

Industrial area

Washington (D. C.)-

Alexandria (Va.)

Chicago

Baltimore

Hartford

St. Louis

San Diego

Vallejo

Albany -Schenectady ■

Troy

Bremerton

New London

Bridgeport-New Haven

Waterbury

Cleveland

Total, 20 industrial
areas

Remainder of country..

Prime defense contracts
cumulated from June
1, 1040, through June
30, 1941

Amount
(000)

$316,668
312, 731
299, 166
264, 480
260, 794
260. 586
237, 057

209, 017
205, 949
203, 111

200, 549
197, 330

9, 720, 230
5, 305, 128

Per-
cent

Cumu
lative
percent

47.0
49.1
51.1
52.9
54.6
56.3
57.9

m.i

62.1

64.7
100.0

Population 1940

Number

of
persons

753, 654
4, 825, 527
1, 014, 925

450, 189
1, 406, 526

289, 348
49, 118

465, 643

44. 387
125, 224

902, 700
1, 329, 640

35, 735, 329
95, 963, 946

Per-
cent

27.1
72.9

Cumu-
lative
pcerent

22.5
23.3
23.6
24.7
24.9
24.9

25.3
2.5.3
25.4

27.1
100.0

Employment on proj-
ects financed with
W. P. A. funds as of
June 25, 1941

311, 250
1, 022, 114

Per-
cent

23.4
76.6

Cumu-
lative
percent

20.1
21.5
21.6
21.7

21.9
21.9
22.0

22.3
23.4

23.4
100.0

than 0.05 percent.

Reports on Fabm-Laeob Shortages and the Work Peojeots Administeation,

1941

Farm-labor shortages have been reported this year from several sections of
the country. The chief explanation for these alleged shortages has been the
attraction of better paying iobs in defense centers. Another widely mentioned
factor is the operation of the Selective Service Act which has taken some workers
from the farms.

Wherever these factors actually threaten to create local stringencies in the
supply of farm labor, and wherever there are Work Projects Administration
employees with agricultural experience, it is the policy of the Work Projects
Administration to make these workers available for farm work. The admin-
istrative officers of the Work Projects Administration cooperate with interested
local groups in facilitating the referral of qualified workers. This course of
action is in line with the general policy of the Work Projects Administration to
encourage the i-oturn of project workers to private employment. To this end
Work Projects Administration seeks to play an active and not a passive role.

The policy of the Work Projects Administration in this respect was established
at the inception of the program, and has been repeatedly made known to the
public by every means at its disposal. On July 10. the Work Projects Adminis-
tration initiated a series of broadcasts designed to reach every part of the Nation,
again restating the determination of the Work Projects Administration to facili-
tate the transfer of Work Projects Administration workers to private employment,
especially to farm jobs.

The market for farm labor is essentially a disorganized one, in spite of the
efforts of the State employment services under the guidance of the United States
Employment Service. What the Work Projects Administration is endeavoring
to do at this time is to encourage farmers to go directly to the employment service
where all certified persons are registered, or, where it is more convenient, to go
directly to the Work Projects Administration office and notify that office of the
number and qualifications of persons needed, the rate of pay, the hours, the
duration, and the location of the job. If labor is available, the employment
service or the Work Projects Administration will have the workers on the job at
the agreed time. If there is no labor available from the Work Projects Admin-
istration, it is appropriate that the farmer should be so informed.

NATIONAL DEFENSE MIGRATION 6497

W. p. A. COOPERATING IN LABOR RECRUITMENT

The Woik Projects Admiuistration has been working with the Department of
Agricultiire and with State committees on farm labor toward a realistic nse ot
the AVork Projects Administration as a source of labor recruiting. The Work
Projects Administration is as anxious to provide workers for farm jobs as it is
to provide labor for industrial employment.

The policy just described is written into the statute governing Work Projects
Administration operations. And the policy is further implemented by adminis-
trative regulations issued to the regional and State Work Projects Administra-
tion offices. While the Work Projects Administration is active in carrying out
this policy, it is equally obligated not to close down projects indiscriminately
and in wholesale fashion at the first unsupported assertion that acute "farm
labor shortages" threaten.

A brief examination of the farm labor situation in the United States demon-
strates, first, that no general farm labor shortage can conceivably exist at the
present time in this country ; and second, that such localized "shortages" as do
develop are almost invariably anticipatory rather than actual and can be
guarded against by tested remedial measures.

GENERAL SHORTAGE OF FARM LABOR IMPOSSIBLE

The impossibility of a general shortage of farm labor in the United States
is at onco apparent from a review of the relevant over-all statistics. In the
recently issued report of the Tolan Committee on the Interstate Migration of
Destitute Citizens, after a careful examination of Nation-wide data, the state-
ment is made: "It is evident that there was in 1940 a reserve of unused or in-
effectively used manpower pressing upon the agricultural labor market of at
least 5,000,000." ^ This large surplus has been the result of the displacement
of labor caused by mechanization of agriculture and, particularly in the thirties,
the damming up of population on the farms because employment opportunities
in the cities became virtually nonexistent. Each city, in fact, had its own large
surplus of unemployed.

This vast labor surplus on the farms cannot suddenly have disappeared.
Rural-to-urban migration, in i-ecent months has been increasing but this develop-
ment has been confined to those urban areas which have become important centers
of defense activity. A liberal estimate of the withdrawals to date from the
reservoir of 5,000.000 surplus agricultural manpower does not exceed 1,000,000,
an estimate which includes those inducted into the armed forces. INIoreover,
some of the losses will be temporary. Large numbers of farm woi-kers who
have been attracted by military construction jobs will be available at the period
of peak seasonal demand for labor this summer and autumn. Such constructiort
has been tapering off rapidly, thus releasing workers when demand will be
strongest.

With continued expansion of the defease program and further enlargement
of the armed forces, we may expect a further reduction in the total farm labor
sui*plus. Such a reduction has long been desired and should be welcomed.
It is symptomatic of an improvement in conditions which have spelled depression
and low living standards for both farmers and their employees. But there
appears to be no immediate likelihood that this surplus will soon disappear.
The net increase in employment during the coming year will probably not
exceed 2 or at the most 2.5 million, so that even if the total increase were to
come from rural areas there would still be a surplus of farm labor. Moreover,
the substitution of agricultural machinery for farm labor is occurring this year
at a greatly accelerated rate.

LOCAL AND TEMPORARY FARM LABOR SHORTAGE

Any general shortage of farm labor, therefore, appears quite impossible.
There remains the possibility that local and temporary shortages may occur
because of the disorganized and haphazard character of the farm labor market..
A review of such alleged shortages as have already been repoi"ted this year makes
it clear that the danger of shortage is commonly exaggerated. The claim that
there will not be enough farm labor at the time and place required is not one
which originated this year. The practice of predicting shortages is long-estab-

iP. 403.

^498 WASHINGTON HEARINGS

lished and springs from several sources. One of these is often the very real fear
that labor will not be on hand in sufficient numbers, at the exact time of greatest
demand. In certain cases there is also the desire to attract a surplus of labor
to the area, thus assuring such intense competition for jobs that wages will remain
low. The statement has been made that in the opinion of some farmers a
shortage of labor exists when there are not as many workers seeking jobs this
year as last and at the wages prevailing last year.

In certain instances the existence of a surplus permits an arrangement of the
work process which results in lower labor cost to the farmer, but in much reduced
earnings to the workers. An example is the assignment in some sections of one
row of cotton to a picker. Such a procedure is not essential for proper picking
of cotton, and it may mean as little as a half day's work for the picker. But in
the view of some farmers it has the advantage of bringing about low labor costs.

With the general surplus so large, all that has been necessary in many localities
has been to put out stories of "shortage" through the newspapers or by word of
mouth. Thereupon labor would promptly apply for jobs in more than the numbers
required. Under these circumstances the most haphazard methods of recruiting
labor have flourished without need for organized community action to economize
the labor supply. Now, with the counterattraction of defense employment in
some localities, the old hit-or-miss methods may no longer suffice.

OPPORTUNITY FOR STATE EMPLOYMENT OFFICES

The present situation, characterized by some decline in the available surplus
and by fear that the declines will become much more serious than is at all likely,
provides an unusual opportunity for the State employment service oflSces and other
Government agencies. A good example of what can be done occurred this year on
the Pacific coast. There was a threatened shortage in Oregon of several thousand
fruit pickers. But there was a surplus of experienced labor in California. The
employment services of Oregon and California and the Farm Security Administra-
tion together worked out arrangements for the transportation and housing of
the needed workers, and for their return to California when their services were
no longer required.

Frequently migration may not be necessary at all. Where a careful check-up
is made of real (not rumored) labor requirements and at the same time of the
number of workers locally available, it is often found that anticipated "shortages"
fail to materialize. Particularly is this the case where adequate wages and
conditions, including housing, are provided. Pooling labor supplies of different
farmers and shifting workers from farm to farm with a minimum delay and
loss of time, may also serve to prevent thi-eatened shortages. Here again a well
coordinated and efficiently operating employment service is of great value. In
fact, only through the work of the employment offices can the eflScient shifting
of labor and the dovetailing of operations be achieved.

If the procedures outlined above do not fully circumvent threatened shortages
within particular areas and localities, other important sources of labor supply
are usually available. Many youth can be employed during the period of vacation
from school. In some areas for certain crops, women also constitute an important
potential labor reserve. Moreover, to meet peak seasonal demands, urban
workers may move out into farming areas. Workers from Philadelphia, for
example, are used in considerable numbers on the farms of southern New Jersey.

"shortages" are failubes to hire at low wages

Most important, however, in any consideration of farm labor is the factor
of relatively low wage scales. Most "shortages" of farm labor represent diffi-
culty in obtaining all the workers wanted at the relatively low wage prevailing.^
Consequently, most "shortages" can be remedied by wage increases. Many
farmers have already increased wages this year. While it is true that farmers
cannot ordinarily pay wages comparable to those in the defense industries,
experience indicates that an advance of wages even to a level considerably
below that in defense work typically succeeds in holding farm labor. For
example, in connection with the recent strawberry picking on the eastern shore
of Maryland, an increase from 2 cents per quart, paid last year, to 3 cents this
year assured an ample supply of pickers, many of whom migrated from Virginia.

There are, of course, great variations in the economic situation of employing
farmers. A consideration this year which bears in a very practical way on the

See testimony of P. C. Turner, Baltimore hearings, p. 6145.

NATIONAL DEFENSE MIGRATION 6499

ability of many farmers to afford higher wages is the greatly improved income
they will receive from 1941 crops. The higher income is due in large measure
to higher benefit payments provided by the Government, as in the case of
wheat, or to increased Government purchases, as in the case of tomatoes.
Relevant also is the fact that a major proportion of the hired farm labor is
employed by large-scale commercialized farms. For example, according to the
census in 1935, 5 percent of all farmers in the State of New Jersey employed
nearly half of the farm workers, while 70 percent of the farmers employed no
labor. These large employers, whether incorporated or not, are often able to
pay relatively higher wages.

HOUSING FOR FAEM WORKERS

Housing facilities for farm workers is this year a matter to which increasing
attention is being directed. Evidently the reduction in farm labor surplus in
certain areas is leading to real improvements in this important feature of the
agricultural worker's standard of living. In many areas, however, no im-
provements have taken place in housing, while wages in some sections of the
North are not infrequently below $2 per day and in some areas of the South
are below $1 per day.

A few examples will serve to reveal the character of current farm labor
shortages. Typically, they are much more serious in anticipation than when the
need for labor actually develops. Newspaper reports from Arkansas about the
middle of May expressed fear over insufficiency of pickers for the large straw-
berry crop.^ Yet, early in June it was reported that 1,479 freight cars of
strawberries had been shipped, or more than twice the number for 1940. To
accomplish this, the Arkansas Employment Service in cooperation with the
employment services of Oklahoma and Missouri, had recruited 25,000 pickers,
10,000 more than in 1940 and 40 pei'cent more than in any preceding year.
The newspaper account presenting these facts makes no mention after the
event of "farm labor shortage." -

"statistical, shortage" in maryi^nd

The situation in Maryland provides further illustration of the difference
between anticipation and realization, but is particularly significant as an example
of what might be called a "statistical shortage" — one produced exclusively by
statistical procedures. The subcommittee on farm labor of the Maryland State
land-use planning committee has released estimates of farm-labor shortage
which are open to serious question.' In the subcommittee's Report on the Farm
Labor Situation in Maryland, issued in April 1941, it was estimated that a
farm labor shortage of 4,000 existed on January 1, 1941, that this had increased
to 10,000 on April 1 and would reach 16,000 by July 1.

These figures were arrived at by applying incautiously the estimating pro-
cedure utilized by the Agricultural Marketing Service of the Department of
Agriculture. This procedure consists of sampling the opinion of farmers on
the supply and demand for labor, expressing their opinions in percentages of
"normal." "Normal" supply with "normal" demand=100; a decline in supply
relative to demand results in an index of less than 100. Farmers' opinions on
what constitutes "normal" are, of course, highly subjective. The subcom-
mittee's analysis makes the estimated 23,000 hired workers normally employed
on January 1 the point of departure for "shortage" estimates cited above,
predicted as amounting to 16,000 by July 1. Whether 23,000 is regarded as
identical with "supply" or with "demand," it is clearly in error to describe the
estimated reduction of 16,000 in supply as a "shortage" as the report does.
The estimate properly represents simply an estimated reduction, by the amount
stated, in the number of unemployed farm workers and of others available
for farm work.

That these predictions of shortage were considerably wide of the mark is
indicated by the fact that to date large seasonal demands for farm labor have
been met in Maryland.* Furthermore, oflicials of the Maryland employment
Service are reported to have revised downward, virtually to the vanishing
point, the estimates of "shortage" set forth in the subcommittee's report.

1 See the Little Rock Gazette, May 17, 1941.

2 Arkansas Democrat (Little Rock) , June 8, 1941.

s See testimany of Dr. S. H. De Vault, Baltimore hearings, p. 6134.

* See testimony of S. Lee Englar and F. B. Gambrill, Baltimore hearings, pp. 6146 and
6147.

ggOO WASHINGTON HEARINGS

SURVEYS OF EASTERN SHORE A:;D JERSEY "SHORTAGES"

In response to claims that the farm labor "shortage" in three Eastern Shore
counties of Maryland was so acute as to call for the general closing down of
Work Projects Administration projects, the Work Projects Administration made
a survey of the situation early in June. In this area of intensive truck farm-
ing the farmers stated that they had "read in the newspapers" that shortages
were expected. But they did not appear unduly alarmed over the prospect.
Seasonal farm operations had been carried on without experiencing shortages;
increases in wage rates evidently insured adequate supplies of labor. While
peak demand for labor had not yet arrived, it was expected that migration
chiefly from Virginia, together with a greatly enlarged program on the part of
the Maryland State employment offices, would provide the additional workers
needed.

A similar survey in several southern New Jersey counties, where requests
were also made for the general closing down of Work Projects Administration
t)rojects, disclosed essentially the same picture. Crops had been taken care
of up to the end of May when our survey was made. In Cumberland County,
vrhere asparagus and strawberries are the main crops, peak demand had al-
ready occurred. Indicative of the nature of much of the farm labor "shortage"
was the situation of one strawberry grower who was interviewed. He had
been named as a farmer who had expressed fear that he would not have enough
labor. Upon inquiry, he informed the Work Projects Administration inves-
tigator that he had employed 35 pickers and turned 5 away.^

These surveys as well as much other material that has come to our attention
support the view that most farm labor "shortages," on close scrutiny, turn out
to be anticipatory rather than actual. One recalls the statement made in
1918 by Assistant Secretary of Labor Louis Post. In that World War period,
when unemployment was much less than it is now, Mr. Post declared : "The
farm labor shortage is two-thirds imaginary and one-third remedial." "

WICKAED PLAN FOR LAND-USE SUBCOMMITTEES

Without hazarding a guess at what the proportions are today, it may be
stated with assurance that the remedial measures, described above, are at
hand for meeting such localized shortages of farm labor as may threaten.
In effectuating these measures the Work Projects Administration in conform-
ity with the policy previously set forth, stands ready to do its part. One way
to attain closer cooperation was suggested in March of this year by Secretary
of Agriculture Wickard. He proposed that in the various States subcommittees
en farm labor of the State land-use planning committees be organized, and
that ex officio members of the subcommittee consist of the State heads of the
following agencies : Farm Security Administration, Bureau of Agricultural
Economics, Extension Service, Agricultural Marketing Service, United States
Employment Service, and Work Projects Administration. More than 30 of
these State subcommittees have been organized, and the State administrator
of the Work Projects Administration is an ex officio member of a large pro-
portion of them. The importance which the Work Projects Administration
attaches to the work of these subcommittees, is indicated by a letter sent to
all State administrators under date of April 3, outlining the work of the sub-
committees and urging the administrators to cooperate in every way. A copy
of the letter accompanies this statement.

The response of the Work Projects Administration in the various States has
been very satisfactory to the Department of Agriculture. This is indicated
by a letter under date of June 27 from Paul H. Appleby, Under Secretary of
the Department, to Commissioner Hunter :

"Reports from State representatives of this Department indicate that co-
operation extended by State Work Projects Administrators, who are working
closely with Department officials on State farm labor subcommittees, has been
very excellent. Work Projects Administration is represented on 31 of the 39
subcommittees now formally organized."

* Copies of the reports on reported shortages of farm labor in Maryland and New Jersey
are attached.

' Quoted in the Tolan committee report, p. 371.

NATIONAL DEFENSE MIGRATION 6501

CALLS FOB W. P. A. SHUT-DOWNS

In certain instances subcommittee reports have appeared which call for the
general closing down of Work Projects Administration projects in rural areas
throughout the State. It is significant that this questionable course, which
fails to take account of local differences in the labor supply situation or of
the characteristics and training of Work Projects Administration project work-
ers, is advocated by subcommittees upon which Work Projects Administration
is not represented.

Among the principal agencies directly concerned in safeguarding against
threatened farm labor shortages are the State employment services. Where
local employment offices exist. Work Projects Administration workers ai'e regis-
tered with them and placements in farm jobs, as with other kinds of work,
are made through these offices. The Work Projects Administration local offices
also increasingly serve as agencies in supplying labor when there are project em-
ployees with the requisite experience and when wages and working conditions
are suitable.

It must not be overlooked that a large proportion of the project workers
even in rural areas, because of age or lack of exiDerience, do not possess the
qualifications needed for agricultural work. Many project workers, therefore,
are not desired by the farmers. This is esiiecially true in cases where the re-
ported scarcity relates to "regular" farm workers — such as experienced tractor
operators, dairymen, and poultrymen. These types are very little represented
on Work Projects Administration projects.

However, all qualified workers are obligated to leave their project jobs when-
ever suitable employment is offered, and the Work Projects Administration
fully recognizes its obligation to terminate them if they refuse such employ-
ment. On the other hand, the Work Projects Administration is obligated to
maintain the standards of employment which are contained in the law. To
permit these standards to be broken down in particular situations, especially
where there occurs a specious plea that shortages of farm labor exist, would
involve maladministration of the law.

Reported Farm Labor Shortage, Eastern Shore, Md.

Newspaper accounts have expressed considerable alarm about the possibility of
a serious agricultural labor shortage in Maryland this year, particularly during
the harvest season. A reduction in the available labor supply has been predicted
as a result of migration of workers to industrial centers and military construction
projects and induction into the armed forces. At the same time, it has been
reported, demand for workers may become greater than normal because of
increases in acreage.

The newspaper accounts were based in some measure on a report prepared by
the Maryland subcommittee on farm labor of the State land use planning com-
mittee, which forecast a shortage of 16,CH10 farm workers in Maryland by July 1.
Much of this shortage was expected to apply to the Eastern Shore. However,
officials of the Maryland State Employment Service are now reported as believing
that this estimate is very much too high.

A field investigation made during the first week in June by the Work Projects
Administration Division of Research of the situation in the three southernmost
counties of Maryland's Eastern Shore — Wicomico, Somerset, and Worcester —
showed that no shortage had yet developed. The concentration of truck farming
and canning in this area makes the supply of sufficient workers to meet the
extremely seasonal and irregular character of its labor demand a matter of con-
cern every year. It is not likely that the problem will reach more serious pro-
portions this year than usual. Farmers who were questioned stated that they had
"read in the newspapers" that there was going to be a shortage this season, but
they did not appear to be alarmed over the prospects.

The larger farms and the canneries in the three counties depend chiefly on hired
workers. Though there is some variation in types of workers needed, in general
the same persons move from farm to farm and harvest one crop after another.

5502 WASHINGTON HEARINGS

Principal crops, in the order of their harvesting, are asparagus, strawberries,
string beans, Irish potatoes, tomatoes, shell beans, and sweetpotatoes. Whole
families, about three-quarters of them Negroes, are employed in the fields. In the
canneries Negro and white adults are employed ; women are in the majority.

FACTORS AFFECTING HARVEST EMPLOYMENT

The extent of the demand for harvest workers depends largely on the size of
the crops, weather conditions during the picking season, and market prices. High
market prices cause farmers to speed up the harvesting ; on the other hand, when
market prices drop so low as to make the harvesting unprofitable, some farmers
plow their crops under. The farmers who have contracted with canneries are less
influenced by price fluctuations than those who sell in the open market. The
irregularity of the demand for workers and lack of coordination of labor supply
and demand occasionally brings about a situation in which farmers in some locali-
ties cannot secure enough workers, while in other localities workers cannot find
enough employment. The "shortage of labor" aspect of this situation rather than
that of "labor surplus" is usually publicized.

The size of the crops to be harvested, and thus the extent of the demand for
workers during the coming picking season is still uncertain. A severe drought
during May caused the strawberry crop to be small. Other crops, already in the
ground in May, were undoubtedly damaged, although more recently heavy rains
have improved the prospect for good yields. String beans, which were expected
to be ready for picking during the week of June 10, should provide a test of the
adequacy of the supply of both field and cannery workers.^

PROPORTION OF MIGRANTS IN HAR\t:ST AND CANNING

Estimates of the number of migrants usually employed vary somewhat, but
it is generally agreed that they make up about half of all cannery and harvest
workers hired during the peak season. Most of the migrants are Negro families
from Virginia and farther South ; others, both Negro and white, customarily
come from Baltimore and nearby areas. This year an increase in the piece-wage
rates for strawberry picking from 2 cents a box to 3 cents is believed to have
provided the inducement for migrants to come in sufficient numbers from other
States, chiefly from Virginia. At the time of this survey the piece rates for
picking beans had not been set, partly because of uncertainty about the price
of beans.

Although there has been some decrease in the available supply of local work-
ers, losses have occurred mainly in the towns and among groups of workers not
experienced in agriculture. The small defense contracts awarded in the three
counties have not resulted in absorption of farm workers in defense industries,
and State selective service officials have recommended deferment of agricultural
workers needed for the harvest.

Concern has been expressed over the possibility of a decrease in the number
of workers coming from Baltimore, where defense activity has resulted in ex-
panded industrial employment. Although it is still too early in the season to
make any definite predictions, one stawberry grower reported that the same 12
white men who, with few exceptions, have picked his berries for the past 18
years came from Baltimore this year as usual. Furthermore, it should be noted
that agricultural and unskilled workers have not been absorbed in large num-
bers even in those industries in which defense production is causing shortages
of certain types of skilled and semiskilled workers. Negroes, who probably con-
stitute about 75 percent of all harvest and cannery workers, have been excluded
from many types of defense employment, and until recently were not accepted
for defense training in Baltimore.

Stricter enforcement of State laws governing labor contractors' activities in
moving migrants from one State to another has also been a matter of concern
to farmers in the southern counties of Maryland's Eastern Shore. Some con-
tractors continue to operate, paying fines every time they are caught. In
other cases, farmers who have a regular supply of workers whom they have
employed year after year, send their own trucks to pick up groups of workers.
This season the regular workers have come to the area in about the same number
as previously.

^ Subsequent information indicates that on June 15, when bean-picking was at its height,
farmers were obtaining an adequate number of worliers.

NATIONAL DEFENSE AIIGRATION 6503

W. p. A. ROLLS AS SOURCE OF EASTERN SHORE LABOB

Work Projects Administration rolls have been one source of labor supply for
local farmers. Total employment on Work Projects Administration projects in
the 3 southern counties of the Eastern Shore fell from 627 at the end of Feb-
ruary to 3SS at the end of May 1941. The awaiting-assignment file had fallen
to 55 by the end of April 1941. Much of the seasonal decrease in the Work
Projects Administration load has been due to separations to private employ-
ment, mainly agricultural, though reductions necessitated by inadequate funds
have also made for decreases in the Work Projects Administration rolls. The
remaining Work Projects Administration load consists largely of older men and
vromen and those who have never done farm work. Although farmers some-
times hire inexperienced workers for some types of labor they are reluctant to
employ such workers to pick crops lest they damage the plants and fail to pick
clean.

Some cases of refusals of Work Projects Administration workers to accept
farm employment have been reported, but in practically all such cases the work-
ers had already left Work Projects Administration for private jobs or had been
called to jobs expected to open within a few days. The district Work Projects
Administration policy is to dismiss those who cannot satisfy the Employment
Service as to their reasons for not answering calls for private employment. So
far this year there have been very few terminations for this reason. Since direct
relief is not granted to employables in these counties, harvest workers cannot
be drawn from local direct relief rolls.

STATE EMPLOYMENT SERVICE CHECKING STATION

The Maryland State Employment Service, in an elfort to provide channels
for the more efficient placement and transfer of harvest hands, this year has
set up a checking station for the registration of migrants on one of the main
roads leading into the State near the Virginia line. By suggesting that the
migrants go to the farms which are hiring pickers that day, the employment
service prevents loss of time in looking for work. To facilitate transfer of
migrant workers from farm to farm, the employment service has secured from
farmers estimates of their labor requirements as well as information on the
supply of workers.

Thus far the employment service has not sent out clearance orders for
farm hands. The district office which serves the three counties had more
than 1,800 persons registered in the active file during the last week of May ;
more than 700 workers were receiving unemployment benefits. As a safeguard
against labor stringency during the tomato picking and canning season, the
Maryland Employment Service has arranged with the Norfolk office of the
Virginia Employment Service to provide clearance if this becomes advisable.

Any significant decrease in the number of farm workers available this year
as compared with other years seems unlikely. Furthermore, there is little
possibility of any substantial increase in the size of the crops to be harvested
and canned. With the development of a more elastic placement procedure
and improved coordination of supply of workers with the demand for workers,
the employment service will probably be better able than before to meet
the needs of both the farmers and the harvest workers.

Reported Farm Labor Shortage, Southern New Jersey, May 1941

In May 1941, newspaper reports implied that farmers in 6 southern counties
of New Jersey ' needed immediately 5,519 additional farm workers, 2,994 of
them in Cumberland County. On May 15, the Cumberland County Agricultural
Committee, fearing a serious farm labor shortage, passed a resolution asking
that all Work Projects Administration projects in the State be shut down so
that Work Projects Administration workers might be available for farm em-
ployment. Later, it was explained that the resolution was intended to apply
only to the Work Projects Administration projects in the agricultural counties
of southern New Jersey, where shortages had been reported.

^ Atlantic, Burlington, Camden, Cumberland, Gloucester, and Salem Counties.

6504 WASHINGTON HEL^RINGS

An investigation conducted by the Work Projects Administration Division
of Researcli during the last week of May indicated that no actual shortages
existed in the area and that the shortages which were feared locally were not
likely to arise. In Cumberland County, where the gi'eatest shortages were
anticipated, the period of usual peak demand had already been reached and no
serious difiiculties in securing enough workers had been encountered. By mid-
June the area of anticipated shortages had moved north to Burlington and
Monmouth Counties where peas, beans, potatoes, and tomatoes will be har-
vested in July, August, and September. The figues reported in the newspapers
reflected the number of additional jobs expected to open during the season and
not the number of additional workers needed at that time. Many workers
follow the crops and fill three or more jobs during one season.

Southern New Jersey, one of the most intensely developed areas of truck and
fruit farming in the country, is characterized chiefly by large farms. * * *
Important crops of the area are asparagus, strawberries, peas, beans, tomatoes,
and potatoes. Havesting of asparagus continues from about mid-April to mid-
June. Strawberries are picked during a 3- to 5-week season beginning during
the last week in May. Picking of peas and beans lasts from the end of June
to the middle of August, when the tomato and potato crops are ready to be
harvested. Onions are topped, peppers picked, and fruit harvested during the
time of the tomato and potato harvesting. The season ends with the berry-
picking in the eastern part of the area.

ASPAEAGUS, STRAWBEKRY HARVESTS MARK PEAK

Peak employment on farms in Cumberland County occurs during the asparagus
and strawberry harvests in late May and early Jime. From this peak the
number of workers needed declines about 25 percent by the middle of June.
The demand remains near the mid-June level until about the first of September,
when it drops precipitously. In other counties in the area peak employment is
reached somewhat later than in Cumberland County.

The anticipation of a labor shortage this season was based largely on the fear
that workers from other areas would not come to New Jersey in as large numbers
this year as in previous years. In 1940 approximately 6,500, or about 25 percent,
of the estimated 26,000 employed during the harvest season in southern New
Jersey came from outside the locality. About half of these workers were em-
ployed in Cumberland County.

It is probable that the total demand for farm workers in New Jersey will be no
greater this season than it was last year. In fact, two circumstances have
tended to reduce the demand for farm laborers. First, use of farm machinery
has been on the increase. According to the local Farm Security Administration,
many more agricultural machines have been sold in the area during the past 3
months than during any other similar period. Secondly, Cumberland County's
strawberry crop this season was seriously curtailed by drought, though the first
crop of the year, asparagus, was as large as last year's. At the Vineland
Produce Market auction up to June 1, only one-third of the usual volume of
strawberries had been brought in for sale. It is still too early to predict the
size of other crops, but since the period when employment is usually at a peak
has already passed, it appears almost certain that a shortage of workers will
not develop in Cumberland County this season.

FACTORS CREATING FEAR OF L.\BOR SHORTAGE

Several factors combined to create the fear that farm-labor shortages would
occur in southern New Jersey during May. Most important was the 1940 ex-
tension of the New Jersey child-labor law to cover agricultural employment.
This law provides that no child under 12 may be employed for wages, and no
child under 16 may work without a special permit from the school authorities.
It was feared that the migrant fai-m workers ordinarily I'ecruited from among
the Italian families in the Philadelphia-Camden area would not come to southern
New Jersey this spring. However, Italian adults did come from Pennsylvania,
as in previous years, for the harvesting of asparagus and strawberries.

Another factor which led to reports of labor shortages was this year's early
harvest season, brought on by imusually warm weather. Thus the harvest of the

NATIONAL DEFENSE MIGRATION 6505

first crops in southern New Jersey coincided with the harvest season in Virginia
and the Eastern Shore of Maryland, and workers from these areas were not
available in the usual numbers. However, since the strawberry crop was small,
enough pickers were secured without canvassing all possible sources of labor
supply.

A third circumstance leading to fears of labor shortages, a circumstance basic
to the whole problem of agricultural labor supply, was the continued low level
of farm prices and wages. Although farm wages are higher this year than last,
they remain below the rates of pay in expanding industrial establishments.
Hourly rates for regular farm workers in southern New Jersey range from 20 to
35 cents an hour. The piece rate for picking strawberries was 3 cents a quart,
compared with 2% cents last year. However, since strawberries were sparser
than usual and it took longer to fill the box, increases in daily wages were not
comparable with the rise in the piece rate. The price situation for the important
tomato crop, under the stimulus of heavy Government buying, promises to be
somewhat more favorable, thus providing the basis for wage advances in harvest-
ing this crop.

Another factor adding to the general feeling of a threatened shortage was the
more rigid enforcement of a law forbidding farm labor contractors to transport
workers from other States. Methods of recruiting labor in southern New Jersey
in the past have been mainly through personal efforts and through padrones, or
agents. The State employment service has been used but sparingly in securing
labor. Of 15,527 placements made by the employment service throughout the
State during April 1941, only 342 (2.2 percent) were in agricultural pursuits.
During the last week in May the first attempt at interstate clearance of workers
was made. In a memorandum sent to the local offices in Bridgeton and Millville,
Cumberland County, it was stated that 1,500 workers from Pennsylvania might be
available for agricultural work.

EMPLOYMENT SE31VICE 8T1XL DISREGABDED

Some success has been achieved so far this year in the efforts of the New Jersey
State Employment Service to encourage farmers to make use of the public-
employment offices. However, it is of interest that the manager and secretary of
the southern New Jersey Vineland Produce Auction Market Association (an
organization representing about 800 Cumberland County farmers), who had com-
plained of the inability of farmers to secure workers, had never heard of either of
the employment-service offices in the county. At the end of April 1941, 3,747
persons were registered in the Millville and Bridgeton State Employment Service
oflSces. About one-third of the 1,348 active registrants in Bridgeton were women.
The manager expected to place many of these persons when the need materialized
in the canning factories.

Work Projects Administration workers have made up only a small part of the
seasonal agricultural labor supply. At the end of April 1941, 693 workers were
employe<l on Work Projects Administration projects in Cumberland County as
compared with 1,2&5 in February 1941. This drop was caused in part by increased
opportunities for private employment and in part by quota reductions. In May,
less than one-fifth of the workers remaining on Work Projects Administration in
Cumberland County had farm backgrounds and most of them were older workers.

In summary, it may be said that the predicted shortage of workers has not
existed to date and there is strong reason for believing that anticipated shortages
will not occur during the remainder of the season, especially since the period of
peak employment in Cumberland County has passed. In spite of the various
deterrents to the normal influx of farm labor, the asparagus and strawberry crops
were picked without serious difficulty. It is doubtless natural for some farmers to
fear shortages when they observe that the usual surpluses of labor have become
smaller. However, as pointed out by Kenneth S. Roberts, a leading farmer of
Cumberland County, and a member of subcommittee on farm labor of the State
land-use planning committee, real shortages of farm labor will almost certainly
be prevented by the pooling of labor resources and increased use of the State
employment service.

6506

WASHINGTON HEARINGS

Federal Works Agenoy

Work Projects Administration

1734 New York AvEinJE NW.

Washington, D. C.

Howard O. Hunter,

Acting Commissioner of Work Projects.

April 3, 1941.

Employment Letter No. 6.

To : All State Work Projects administrators.

Subject : Cooperation with State subcommittees on farm labor.

The Department of Agriculture has indicated that in 1941 there may exist,
along with large surpluses of agricultural labor, serious dislocations of such
labor of a local or seasonal nature. The Work Projects Administration has
always been committed to a program of facilitating the return of certified persons
to private employment. The Honorable Claude R. Wickard, Secretary of Agri-
culture, has requested the Administration to participate on a State basis with
State subcommittees on farm labor in meeting such dislocation problems as they
may arise.

The Department of Agriculture has suggested that State land-use planning
committees establish State subcommittees on farm labor to meet these problems.
The Department of Agriculture desires to obtain for the State subcommittees on
farm labor the cooperation of the State representatives of the Farm Security Ad-
ministration. Bureau of Agricultural Economics, State statistician of the Agri-
cultural Marketing Service, State extension service. State employment service,
and also the State work projects administration.

For detailed information on this program, the following releases of the Depart-
ment of Agriculture are attached hereto : ^

1. Reorganization of Department's Agricultural Labor Committee and Proce-
dure for Dealing with Problems of Farm Labor Supply, Memorandum No. 820,
Supplement 2, released by the Honorable Claude R. Wickard, Secretary of Agri-
culture, March 10, 1941.

2. Suggestions for Facilitating the Work of State Subcommittees on Farm
Labor, No. FL-1-41, released by the United States Department of Agriculture,
March 10, 1941.

3. A list of secretaries of the State land-use committees.

In keeping with the same principles set forth in Mr. Howard O. Hunter's
memorandum of November 30, 1940. on "Private and Public Employment of Cer-
tified Persons," and also Mr. Fred R. Ranch's Memorandum of September 25,
1940, on the Work Projects Administration-Social Security Board Understanding,
the State work projects administrator is requested to designate a representative
of the Division of Employment to cooperate with the State subcommittee on
farm labor.

Malcolm J. Miller, AssiMant Commissioner.

1 Three copies of each attachment sent to each regional director and one copy to each
State administrator.

NATIONAL DEFENSE MIGRATION 6507

P. A. Projects, June 1941 and

Average Number of Persons Employed on W

June 1940

[Subject to revision]

Increase

June 1941

June 1940

(+) or de-
crease (-)

1, 410, 943

1, 755, 526

-344, 583

1, 375, 804

1, 734. 497

-358, 693

32, 037

34, 523

-2, 485

5,607

5, 740

-133

29, 757

26, 941

+2. 816

56,813

75, 571

-18, 758

30, 789

42, 827

-12,038

26, 024

32,744

-6,720

16, 961

17. 234

-273

6,921

16, 724

-9, 803

1,959

2 736

-777

7,909

10, 799

-2.890

25, 372

25, 379

-7

30, 061

35, 388

-5,327

6,444

7,237

-793

95. 547

135, 737

-40, 190

34,067

47, 345

-13,278

18, 830

19,093

-263

20,280

20,374

-94

29, 148

34, 463

-5,315

28,736

24, 783

+3, 953

4,602

6,246

-1,644

8,172

1.5,220

-7,048

57, 142

65, 910

-8, 768

48, 838

67, 1.55

-18,317

36, 941

35, 674

+ 1,267

28,447

25, 758

+2,689

51.871

64,411

-12,540

8, 415

8,736

-321

20,183

20,196

-13

1,231

1, 470

-239

4,820

6,234

-1,414

42, 471

58, 511

-16,040

10,066

9,024

+1,042

76, 619

103,054

-26, 435

25,311

42,092

-16.781

30, 302

37,460

-7, 158

9,918

9, 598

+320

80,670

118,994

-38, 324

32, 109

37, 843

-5,734

9,096

12, 658

-3, 562

93,018

158,605

-65, 587

6,037

10, 952

-4.915

25, 801

28, 668

-2, 867

9,764

9,463

+301

29,449

33, 600

-4, 151

73, 845

73, 246

+59»

8.425

8,702

-277

2.662

3, 833

-1,171

17, 378

26, 259

-8,881

16, 366

23, 557

-7, 191

26,850

30,011

-3, 161

30,295

38, 713

-8, 418

2,2'U

2,5/7

-336

241

-222

1,031

1,672

-641

32, 584

17, 356

+15, 228

1,505

1,760

-255

Continental United States.

Anzona.— .
Arkansas..
California.

Northern -
Southern.

Colorado

Connecticut

Delaware

District of Columbia.

Florida

Georgia

Idaho

Illinois

Iowa-

Kentucky

Louisiana

Maine

Maryland

Massachusetts-

Michisan

Minnesota

Mississippi

Montana

Nebraska

Nevada

New Hampshire

New Jersey

New Mexico

New York City

New York (excluding New York City).

North Carolina

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania

Rhode Island

South Carolina.

South Dakota

Tennessee

Texas

Utah

Vermont--

Virginia

Washington

West Virginia

Wisconsin

Wyoming

Alaska

Hawaii

Puerto Rico

Virgin Islands

g508 WASHINGTON HEARINGS

TESTIMONY OF CORRINGTON GILL— Resumed

The Chairman. Mr. Gill, have you any figures or have you made
any investigation as to the number of workers that will be absorbed
by industry in the next fiscal year?

Mr. Gill. Yes; we believe that between 2 and 2i/^ million new
w^orkers will be employed during the coming fiscal year.

The Chairmax. And what are the main factors to your mind
which will hinder a more rapid rate of reemployment — not in detail
but sort of a summary of it?

Mr. Gill, Well, the bottlenecks that have appeared and are ap-
pearing and will appear in industry, will prevent a more rapid rate
of reemployment.

The Chairman. What do you call a "bottleneck of industry" ?

Mr. Gill. The inability, let us say, of the manufacturer to get
certain parts that are needed for the manufacture of the airplanes
that he is building.

Another reason keeping manufacturers from increasing plant ca-
pacity is their fear that when this emergency is over they are going to
have a heavy inventory and a heavy plant investment on which they
will not have any opportunity of making money.

The Chairman. In other words it is gambling on the future con-
cerning which nobody knows?

Mr. Gill. That is correct.

The Chairman. And what else?

NECESSITY OF BUNCHING DEFENSE CONTRACTS

Mr. Gill. Other factors slowing up reemployment are the decline
in the civilian production due to shortages and priorities. Another
is the time that it takes to change over from a nondefense industry
to a defense industry. Another is the concentration of defense pro-
duction in a few industrial areas.

The Chairman. Is any attempt being made to spread that now?

Mr. Gill. Yes; they are making very strong attempts to do it,
but industry in this country, as you well know, is highly concen-
trated and to get production going quickly they were forced to let
contracts to comparatively few firms.

The Chairman. In other words to take advantage of the present
existing facilities they let contracts to a few manufacturers?

Mr. Gill. That is correct.

The Chairman. And they were forced to do that?

Mr. Gill. That is right, sir.

The Chairman. But there is an attempt being made now to spread
it, isn't there?

Mr. Gill. Definitely.

The Chairman. And what else?

EXCESSIVE inventories

Mr. Gill. Another factor that hinders this more rapid rate of
employment is the existence of excessive inventories. Many firms
have built up excessive inventories of raw materials and consequently
there are shortages in these certain raw materials among other firms
at the present time.

NATIONAL DEFENSE MIGRATION 6509

The Chaikman. Do you find, Mr. Gill, that as the rate of produc-
tion increases the rate of employment increase fails to keep pace?

Mr. Gill. Yes. There are certain figures, Mr. Chairman, which I
think will show that very clearly.

For example, from 1920 to 1940 there Avas no increase in the number
of persons employed in manufacturing plants, and yet you had an
increase of 66 percent in the volume of physical production during that
period ; during the past year, from ]SIay 1940 to May 1941, you had an
increase of 35 percent in production, and in those plants an increase of
only 22 percent in employment.

The Chairman. Mr. Gill, if, as you estimate, approximately 2^/2
million workers may be reemployed in 1941, is it likely that unem-
ployment will decrease correspondingly ?

Mr. Gill. No, sir. In the first place, it must be remembered that
each year we have a net increase of about 600,000 persons in the labor
market.

Furthermore, you will have during this coming year a very heavy
abnormal increase in the labor supply — people who are not normally
counted as unemploved.

The Chairman. Where do the 600,000 come from?

Mr. Gill. Well, it is the 3'oung people — it is the net working popu-
lation increase.

The Chairman. And that averages about 600,000 every year ?

Mr. Gill. Net, yes.

UNCERTIFIED ELIGIBLES FOR W, P. A.

The Chairman. How many workers are eligible for W. P. A. but
not being certified for lack of funds ?

Mr. Gill. At the present time we are employing less than half of
the persons who are unemployed and said to be in need by local relief
agencies. That figure varies from time to time, from month to month,
and from year to year.

At the present time we are employing a smaller percentage of the
needy unemployed than any time since 1935.

The Chairiman. How many W. P. A. employees have been cut off
on account of the reduced appropriation passed by Congress?

Mr. Gill. In May we had 1,450,000. At the present time we have
1,000.000— slightly over 1,000,000 persons. Some 400,000 have been
cut off in the last 60 days.

The Chairman. What becomes of those 400,000 — what do they do —
are they employables ?

Mr. Gill. Oh, yes; definitely, very definitely, sir. Some of them
get jobs in private industry — by no means all, however. Many of them
reapply at relief offices.

We made a study of how^ many of the persons who had been cut
off reapplied, and we found that the percentage varies from city to
city, but from between a third and a half requalified for direct relief
in the local welfare offices after they had been cut off from W. P. A.

migration as result of w. p. a. cuts

The Chairman. Do you think, Mr, Gill, considerable migration to
defense centers will result because of these people being cut off the
W. P. A. rolls?

6510

WASHINGTON HEARINGS

Mr. Gill. I don't know that I can make a statement, Mr. Chairman,
that would answer that question specifically.

There certainly is migration, and I have no doubt that a lot of
people who were' cut off from W. P. A. have moved or have gone into
defense areas, into industrial cities, to try to get jobs. I don't know
how many. We haven't measured that.

The Chairman. I was interested in your statement in which you
said that a lot of people were going to defense centers. That doesn't
mean they will all secure employment ?

Mr. Gill. On the contrary.

The Chaieman. You haven't any figures, have you, Mr. Gill, to
indicate the portion of people who actually get employment in a plant
in defense centers and those that do not? The reason I am asking
that question is, in one of our hearings it was brought out that but
1 in 5 who applied were hired.

Mr. Gill. I believe that that figure is correct.

employers' preference as between w. p. a. and migrants

The Chairman. Do defense contractors prefer to employ outside
labor rather than local W. P. A. workers?

Mr. Gill. We probably do not get as high a proportion of reemploy-
ment in private industry as the proportion of W. P. A. workers is to
the number of unemployed.

The average age of the W. P. A. worker is 43 years. The people
who are being employed in defense industries, generally speaking, are
young men. Some of these plants will not hire anybody over 25
years old.

The Chairman. Now, as we understand it, approximately a half
million W. P. A. workers are on projects certified by the Army or Navy
as national-defense work, but the workers are not getting the pre-
vailing wage rates, although the workers are doing essential work,
are they not ?

Mr. Gill. That is correct.

The Chairman. What do you think about that situation ?

Mr. Gill. Your statement is not quite correct as to the numbers,
Mr. Chairman. We have at the present time about 400,000 persons on
defense projects. Of that number, about 225,000 are working on
projects that have been certified by the Secretary of War or the Sec-
retary of the Navy as being of prime importance for national defense.
On those projects, certain exemptions can be made in accordance with
the Relief Act.

We can make exemptions concerning the number of hours that
they work, and make certain other slight exemptions, but they are
paid in all cases in accordance with the schedule of security wages.
They make more money if they work longer hours, but it still is
probably below the prevailing rate.

comparison or w. p. a. and prevailing wages

The Chairman. How do prevailing wage rates compare with the
W. P. A. rates?

Mr. Gill. That is a difficult question, if not impossible question, to
answer, for this reason :

NATIONAL DEFENSE MIGRATION g511

We have, as you know, a schedule of monthly earnings that W. P. A.
workers receive twice a month. We do not have an hourly rate.
Actually, of course, if you divide the schedule of earnings by the num-
ber of hours they work, you get an average hourly earning figure, and
that is an absolute figure. It happens to average 45 cents an hour for
all workers on W. P. A., but where you try to make a comparison of
the prevailing rate, you have the problem of ascertaining the pre-
vailing rate.

That is a very difficult thing to determine, of course. I would esti-
mate that if such a comparison could be made, this 45-cent rate would
run probably about two-thirds of the prevailing rate.

The Chairman. Have you any figures to indicate whether the re-
ported farm labor shortage is anticipatory or is actual ?

Mr. Gill. Almost entirely anticipatory, Mr. Chairman.

We receive complaints — and this is not something new that just hap-
pened when the defense activities built up last year, but periodically
for the last 6 years — of shortages of labor in some particular place, and
we have always investigated immediately. In practically every
instance we found that there was no actual shortage, but that somebody
was worried for fear there was going to be a shortage. Upon investi-
gation we found that no shortage did develop.

The W. P. A. has cooperated throughout its history with the local
employment offices, with the United States Employment Service and
Department of Agriculture, and local employers to make sure
W. P. A. employment does not interfere in any way with local
employers getting help when they need help.

The Chairman. Well, these 400,000 W. P. A. workers who have been
dropped from the rolls should help to take up this slack of farm-labor
shortage.

Mr. Gill. Yes ; plus all the people that are on W. P. A. — because we
release them immediately if there is any actual shortage developing —
plus the large number of unemployed persons who are not on W. P. A.
We only employ about 25 percent of the unemployed.

The other 75 percent are available, just as the W. P. A. workers are
available, at all times for private jobs.

The Chairman. I know in our hearing, especially at Baltimore, the
fear was expressed there that there would be a farm-labor shortage,
and some of the witnesses indicated that the blame, lots of times, was
with the farmers, because they would not give them sufficient notice
as to how many men they would need to do the work, but rather would
expect to get them the same day. They testified that it took a few days
to get them together.

But you are not very fearful about a farm-labor shortage ?

Mr. Gill. No, sir ; not a bit. In certain areas, in the cotton sections
of the South, for example, during the cotton season we close the
projects in a county if there is any actual shortage of workers.

w. p. a. training for defense work

The Chairman. Will you, Mr. Gill, briefly describe the W. P. A.
and vocational-bchool training program and indicate the numbers
trained, if you have those numbers ?

Mr. Gill. Yes ; I will be very glad to. We have trained over 115,000
persons for defense work.

60396— 41— pt. 16 14

0512 WASHINGTON HEARINGS

The Chairman. Right there, do they get paid while being trained ?

Mr. Gill. Yes, sir. They receive their usual W. P. A. wage.

The Chairman. And how many have you trained?

Mr, Gill, One hundred and fifteen thousand had or are receiving
training. Of the 80,000 who have completed, about 65 percent have
obtained jobs. The others, of course, are ready to take jobs when
they open ujd in their locality.

We have at the present time about 35,000 in training, and this num-
ber is constantly turning over because I think the period of training
is only from 8 to 12 weeks.

The training is being done in about 650 different communities in the
country. In addition to or as a part of that training, we also have a
program of in-plant training. There we take persons on W. P. A.
who show an aptitude for training, who can absorb the training, put
them right in a manufacturing plant, and during the period of 2 to 4
weeks, under the supervision of the plant foreman, they are trained.

Most of them go right into the shop as private employees and are
cut off of the W. P. A. at the end of that training period.

The Chairman. Mr. Gill, will this reduced W. P. A. appropriation
have any effect on the training program of the W. P. A. ?

Mr. Gill. I think if we had a larger appropriation we probably
could do more training.

The Chairman. What I am trying to get at is — you say you have
trained 115,000. The appropriation has been reduced, and hundreds
of thousands have been taken off of the W. P. A. pay roll. As a result
of that, has there been any reduction in your training program?

Mr. Gill. No, sir; there has not. The 115.000 are those who have
or are going through the training period. At any given tune there
are only thirty or forty thousand who are in training.

status of migrant in training program

The Chairman. How does the migrant fit into this training pro-
gram ? Does he have au}^ status at all ?

Mr. Gill. He doesn't have any preferred status. He stands on his
own feet along with others who are certified as in need and who show
a particular aptitude for training. We have in that training program,
1 am sure, a large number of migratory workers. Statistically, I can-
not give you an answer as to how many or what proportion they are.
In any event, they are not discriminated against.

JV'Ir. Curtis. Do you have a break-down as to where those people are
located who receive training through the W. P. A. ?

Mr. Gill. I don't think I have with me.

Mr. Curtis. Has it reached all of the States?

Mr. Gill. It is in 48 States and in, as I said, about 650 communities.
I am sure it is heavier in some States than others.

Mr. Curtis. In what specific lines are you training them ?

Mr. Gill. Any line that the vocational-education people in the com-
munity believe would be suitable and might lead to private employ-
ment. It is a project that is jointly sponsored by the Office of Produc-
tion Management and the Office of Education.

Mr. Curtis. I wish you would enumerate some of the courses, Mr.
Gill.

NATIONAL DEFENSE EMIGRATION g513

Mr. Gill. In the Bell Aircraft plant, as an example of one of onr
in-plant training programs, we have men being trained for machine
operation. That is one example.

Mr. Curtis. Are most of the men being trained under your program
receiving in-plant training?

Mr. Gill. No, sir; I would say most of them are not receiving in-
plant training.

Mr. Curtis. Those who are not receiving in-plant training — what
are joii training them to do?

Mr. Gill. A large number of these persons, for example, have been
trained in welding, and large numbers of them have received private
employment as welders in the shipbuilding program near New Orleans.
I happen to know that particular case.

Mr. Curtis. And what else besides welders ?

JNIr. Gill. I would like to put a list of the various occupations in
the record.

Mr. Curtis. I would be very glad to liave that.^

W. p. A. WORKERS ENGAGED IN DEFENSE

Now, you state that quite a number of W. P. A. people are engaged
in defense projects?

Mr. Gill. Yes, sir. The list of major occupations referred to above,
in which training is being given, would include auto service, aviation
services, machine shop, welding, drafting, pattern making, woodwork-
ing, riveting, sheet metal, radio services, electrical services, foundry,
forge, ship- and boat-building and repair, and construction.

Mr. Curtis. You don't mean that they are building airplanes or
ships or motors or guns, do you ?

Islr. Gill. No, sir; most of them that are working on certified de-
fense projects are building airports that are important to the Army
or the Navy.

Mr. Curtis. In other words, they are engaged in what we usually
term as public works, but public Avorks that have shown they have a
military value?

Mr. Gill. That is correct ; yes, sir ; exactly.

Mr. Curtis. And a great deal of that is nonskilled labor ?

Mr. Gill. Yes, sir; particularly on airport construction and on the
access-road program. Both of those use a very high percentage of
unskilled labor.

Mr. Curtis. Don't you think it is better for the individual, for his
own good, if there is always maintained a wage inducement for him
to seek private employment ?

Mr. Gill. He has the wage inducement, Mr. Congressman, because
what he receives on W. P. A. is not what he could receive if he were in
private employment in that area.

Mr. Curtis. Is it your opinion that that should be the case, or are
you here contending that these W, P. A. wage schedules should be as
high as private schedules?

Mr. Gill. No, sir. I believe at the present time, and for the past
couple of years, the W. P. A. wage has been about right. I don't say

1 A copy of this list of occupations was included in Mr. Hillman's paper. See p. 6360,
table 2.

5514 WASHINGTON HEARINGS

it is what people ought to receive, but in our economy I think it is
about right.

PURPOSE OF w. p. A.

The purpose of the W. P. A. is not primarily defense. The purpose
is to give employment to needy unemployed persons at a wage that will
be adequate to support them in decency, but will not be so high as to
prevent their wanting to take private jobs.

Mr. Curtis. You don't think that employment in the W. P. A.
should become a career?

Mr. Gill. I do not.

Mr. Curtis. Now, you discussed something about the relationship of
the W. P. A. workers to farm help. What is the situation in regard
to domestic help — women and girls when they leave the W. P. A.
or N. Y. A. to accept work as domestics?

Mr. Gill. I think that probably there is more back of complaints
that W. P. A. interferes with people hiring domestics than any other
particular type of complaint, I think the reason is that the average
wage domestics in this country receive is absurdly low. I believei
that if domestics received better or adequate wages there would be
no complaint.

Mr. Curtis. Do you think it is entirely a question of wage ?

Mr. Gill. I think it is to a considerable extent, I think most of
the problem is the low wages paid to domestics in this country.

Mr, Curtis. Are your complaints uniform throughout the various
areas of the country?

Mr, Gill. No. We get very few complaints such as that in metro-
politan northern cities, where domestics receive more of an adequate
wage than they do in some other sections of the country.

Mr. Curtis. Do you contend that if people have an opportunity to
secure employment, that they are physically and mentally able to do,
that they should take it, even though it is not quite as' desirable as
the W. P. A,?

Mr. Gill. Our regulation on accepting private employment specifies
that the wage be a decent wage and the condition of employment be
decent. I know that is a matter of opinion, however.

Mr. Curtis. It is a rather relative term, isn't it?

Mr. Gill. Yes; but we did put that safeguard in to prevent the
abuse that we have had, instances where employers would offer
W. P. A. workers substandard wages or jobs that required hours far in
excess of the hours that should be required, particularly in farm la-
bor— not general farm labor, but in certain specified farm areas the
wage was absurdly low,

W, p. A. SAFEGUARD AS BUOY TO FARM WAGES

Mr. Curtis. Well, does that tend to force the price of farm labor up ?

Mr. Gill. I don't believe so, in general. I think it may have some
effect in a few spots. I think that one might say that in certain areas —
in the cranberry fields of New Jersey, for instance, as I remember, and
in the onion fields in certain sections of Ohio, and in the beet fields in
certain sections of Colorado, I think that it may have had some tend-
ency to increase wages in those particular spots.

NATIONAL DEFENSE MIGRATION Q515

Mr. Curtis. And do you favor that?

Mr. Gill. I certainly do.

Mr. Curtis. Do you favor it under a system whereby the farmer
cannot pass on any of these increased labor costs in the price of his
product? Now, I notice that we took some testimony a couple of weeks
ago in reference to strawberry picking. Strawberries sold for $2 a
crate. They were paying about 60 or 70 cents to get a crate picked, but
the wages were raised to $1.20. The crates cost the farmer 51 cents and
the farmer was paying that increase out of his own pocket. He got 29
cents for himself and his family, for all of that season's work and in-
vestment and the hazard involved, but there is no way of adding that
increased cost in labor onto the price of the berries. It just doesn't
happen. And, while I would like to see the farm laborers of the coun-
try get high wages, I just can't understand the officials of this Govern-
ment forcing those wages up at a time when it means taking pennies
and nickels away from the farmer's family.

Now, if he could pass it on, that would be all right ; but I certainly
disagi'ee with any such policy.

That is all, Mr. Chairman.

The Chairman. Mr. Arnold?

WATS TO REDUCE W. P. A.

Mr. Arnold. You will probably agree with me that the only way the
W. P. A. rolls can ever be cut down is by forced action — that is, it will
be necessary that the Congress reduce the appropriation in order to
reduce the W. P. A. rolls.

In other words, as long as you have an appropriation of one and a
half billion dollars, you will find people who will make application to
get on your rolls.

Mr. Gill. There is a difference of opinion there, Mr. Congressman.
I personally do not believe that that is correct I do not believe that
the only way to reduce the W. P. A. is to cut the appropriation.

The fact that we have as large a turn-over as we have and as many
people going into private employment, indicates that there is no neces-
sity of cutting the appropriation to reduce the rolls.

Mr. Arnpld. Of course, I am speaking to you as one who has sup
ported the W. P. A. appropriations and one who feels that W. P. A
has performed a great service in the past, but I represent a rurai
community in southern Illinois where tenant farmers who live on small
farms are attracted to the W. P. A. because that work brings more
cash income to them. They are farmers who have had, misfortunes,
and the W. P. A. appeals to them because it gives them more cash
income than they can make on their farms.

Then, in small towns out in that area, it is almost impossible to
secure workers for home work. I was out there last week and stopped
along the Wabash River at Grayville, and Palestine, where in former
years you could always buy fish, but there was no one fishing any more.
I don't know whether they were on W. P. A. or not, but probably
W. P. A. would furnish them more cash income than fishing.

As I see it, it is an endless chain.

6516 WASHINGTON HEARINGS

TURN-OVER IN SEWING PROJECT

And just recently, because of tliis reduced appropriation, a certain
sewing project in my district was scheduled to discontinue employing
20 women, 15 of whom were widows, 5 of whom had husbands unable
to work. This is all in an area that has brought in 7,000 producing oil
wells in the last 4 years.

Now, I am wondering, in view of those conditions before W. P. A.,
what would those men and women have done? They protested to me,
and I managed to get the project reopened, but what would those
Avomen have done before the days of W. P. A. ?

Mr. Gill. Some of them would have been on local relief, and some
of them would have been probably living with relatives, and some, I
suppose, would probably be working as domestics.

Mr. Arnold. That is where I think the bulk would be working. But
the point I am trying to make is that it is just human nature, with
the American people, to try to better themselves and secure steady em-
ployment. For that reason it is very difficult for W. P. A. to reduce its
rolls, because there always will be more waiting than you can take
care of.

Mr. Gill. I might say that the turn-over in the sewing project was
far lower than the rate of turn-over in other types of projects. There
were fewer private-job opportunities for those people than there were
for construction people or even common-labor jobs, and, consequently,
that part of the program had a tendency to remain more static than
the rest of the program.

Mr. Arnold. That is all I have, Mr. Chairman.

The Chairman. Congressman Osmers ?

TYPE or PERSON DISCHARGED BY W. P. A.

Mr. Osmers. Mr. Chairman, I was interested in one thing Mr, Gill
said in reply to a question that you directed to him, regarding a type of
people that were involved in the 400,000 that had been discharged.

The chairman asked you whether you considered these people were
employables or not, and you said : "Very definitely."

Well, that seems to be at variance with what personal observations I
have been able to make among the people that have been discharged.

I expressed yesterday to the committee my opinion that a great many
of the people now on W. P. A. are not strictly in the employable class,
either temperamentally or physically, or because of their age or of
some other factor.

Now, in my own State we have a rather serious problem, which I
wrote to Mr. Hunter about the other day, in the State of New Jersey.
We have had our numbers cut to a greater proportion than some other
States in the Union.

Mr. Gill. That is right.

Mr. Osmers. And, of course, the answer that ^Ir. Hunter gave me
makes a plausible answer on paper — that we had received a great
many defense contracts in New Jersey and therefore the need was
considered to be less than it was in other areas. But when it was
translated into human terms, to the individuals that were discharged,
it didn't work out because we found, and I have found, that the

NATIONAL DEFENSE MIGRATION 6517

people that have been discharged are not necesarily employable under
the defense program.

For that reason I would like to have you go into your definition of
an "employable."

DEFINITION or "EMPLOYABLE"

Mr. Gill. An "employable person," in my opinion, is one who can
get a job at any given time ; consequently any definition of "employ-
able" depends upon the status of the labor market at that particular
time.

At the bottom of the depression the standard set-up for employ-
ment was probably higher than it ever was. As employment picks up
and as labor becomes more scarce, workers have a much better chance
of getting a job. For example at the present time with five or six
million still unemployed, a person of 55 years of age might be consid-
ered unemployable. If because of defense or increased nondefense
business in the next 5 years we get the unemployment figure down to
a half million, let us sa}', the person of 50 or 55 years of age will be
considered employable and will have a job and will be doing good work.
But on any forced lay-off such as we made in the last 30 days it wasn't
to be expected that those persons would step right out and get jobs in
private industry.

They are competing with 3 times that number, at least, who were
unemployed — not 3 times that number, but 10 times that number —
who were unemployed in that community at the same time, men who
possibly lost their jobs more recently than the W. P. A. worker did —
men who are younger than they are.

Mr. OsMERS. Well, now it seems to be working out in this country
as we go into the war economy, that while more and more people
are being employed in defense industries, fewer and fewer are being
employed in nondefense industries.

Mr. Gill. That is correct.

Mr. OsMERS. Because of priorities in materials and for numerous
other reasons?

Mr. Gill. That is right, so their chances may not increase in direct
pyroportion to the number of defense jobs that are opened up.

Mr. OsMERS. Would you say that a majority of the people remaining
on W. P. A. today would, in normal times, be family responsibilities?
You implied, in response to Congressman Arnold's question, that a
great many of those from 50 to 65 years of age would be family re-
sponsibilities— would be living with relatives, children, and so on.

Mr. Gill. Yes ; and on direct relief in the community.

Mr. OsMERS. Charities?

Mr. Gill. Yes; may I make one statement here? When I said
these people were "employable people," I said it in terms of W. P. A.
employment.

These 400,000 men are typically those who have been working
on the W. P. A., possibly for a year, building airports, building
various kinds of road work, and doing a good job. The physical
accomplishments of the W. P. A. during that period would be evidence
that they have been doing good work.

That was what I meant in connection with their being employable
or not.

g518 WASHINGTON HEARINGS

CHOICE BETWEEN CUTTING W. P, A. ROLLS OR RATES

Mr. OsMEES. Do yoii think it was wise to cut the number on W. P.
A. rather than the amounts paid to each individual ?

Mr. Gill. I don't think the amounts paid to each recipient would
stand any cut.

Mr. OsMERS. I was wondering what a man who was completely
cut off the pay roll would think about that.

Mr. Gill. Well, it is always a question if you are going to employ
X number of people at a decent wage or whether you are going to
take that money and distribute it, however, thinly it might work
out, so as to give everybody something.

We had the same problem during the F. E. R. A. days, whether to
give out available funds generally without any standard of relief, or
whether to set a standard below which we would not go. We set a
minimum and it gave the money to fewer people but it did maintain
a level of decency for those that got the money.

Mr. OsMERS. William Green of the American Federation of Labor
testified yesterday that in the master agreements that are being
made in certain industries in the United States, there is a clause
which permits both the union and the employer to reexamine the
rates of pay every 6 months, because of the rising costs of living.

Has the W. P. A. taken into consideration the rising costs of
living ?

Mr. Gill. We haven't had to so far because the rise has not been
sufficient up to now to create any difficulty. I suspect that in the
next 12 months we are going to have to reexamine that very care-
fully.

Mr. OsMEES. Do you feel that if Congress fails to make additional
appropriations and if you decide to raise the individual amounts
paid, that you will then drop off more people?

Mr. Gill. It is just a matter of arithmetic; yes; we would have to.

Mr. OsMERS. That is all.

The Chairman. Thank you very much, Mr. Gill. We appreciate
your statement and comments to the committee.

Our next witness is Mr. Alves.

TESTIMONY OF H. F. ALVES, SENIOR SPECIALIST IN STATE SCHOOL
ADMINISTRATION, UNITED STATES OFFICE OF EDUCATION, FED-
ERAL SECURITY AGENCY, WASHINGTON, D. C.

The Chairman. Mr. Alves, Congressman Curtis will interrogate
you.

Mr. Curtis. Will you give your full name to the reporter, please?

Mr. Alves. H. F. Alves.

Mr. Curtis. And what is your official position?

Mr. Alves. Senior specialist in State School Administration,
United States Office of Education.

Mr. Curtis. How long have you been with the Office of Education ?

Mr. Alves. Six years this coming October.

Mr. Curtis. And what work were you engaged in prior to that
time?

Mr. Alves. For 10 years I served in the State department of edu-
cation in Texas, first as State high-school supervisor, and then as

NATIONAL DEFENSE MIGRATION 6519

State college examiner; then as director of research and finance and
executive secretary of the State board of education.

Mr. Curtis. "Wliat degree or degrees do you holdl

Mr. Alves. Bachelor's, master's, and practically completed doctor's.

Mr. Curtis. Have you received some special training in school-
plant management and facilities, and that sort of thing ?

Mr. Alves. Yes, sir.

Mr. Curtis. The Office of Education has made a study of school
facilities in connection with national defense, I believe?

Mr. Alves. Correct, sir.

Mr. Curtis. At whose request was that made?

Mr. Alves. At the request of the Secretary of the Navy and the
Secretary of the War, in resjDonse to Senate Resolution 324.

Mr. Curtis. How large a committee was designated to make this
survey ?

Mr. Al\tes. There was no committee designated. The responsi-
bility was placed in the Office of Education — that is, on the United
States Commissioner of Education.

]\Ir. Curtis. Were you in charge of that work ?

Mr. Al\t:s. By assignment I was placed in charge of the study,
which was carried on in cooperation with the chief State school
officers of the 48 States, who in turn called on the local school au-
thorities.

(The following statement was introduced for the record :)

STATEMENT BY H. F. ALVES, SENIOR SPECIALIST IN STATE SCHOOL
ADMINISTRATION, THE UNITED STATES OFFICE OF EDUCATION,
FEDERAL SECURITY AGENCY, WASHINGTON, D. C

School Needs in Defense Areas

Activities essential to the national defense program call for concentrations of
population at designated points, which in turn call for the rendition of services
necessary to community living. The enlargement of existing as well as the
location and construction of new military and naval reservations and industrial
establishments have necessitated and will necessitate a rapid shifting of popu-
lation. Today, after nearly a year of the emergency, hundreds of thousands of
families are living under roofs not known to them or anyone else several months
ago. But moving large numbers of families from one community to another and
from one State to another is, as we might expect, forcing us to recognize many
problems relating to and involving the education, health, and general welfare
of youth and adults.

Senate Resolution 324, dated October 9, 1940, called upon the Secretary of
War "to make a full and complete study and investigation of all school facilities
at or near naval yards. Army and naval reservations, and bases at which housing
programs for defense workers are being carried out or are contemplated."

Following requests from the Secretary of the Navy and the Secretary of War
for the United States Office of Education to make the study called for by
Senate Resolution 324, plans for the study were formulated with the assistance
of interested Federal agencies and State departments of education. The study
as planned and carried out, however, included all local areas affected by
activities of the defense program— not only those "at which housing programs
for defense workers are being carried out or are contemplated," and centered
attention on the three specific questions in Senate Resolution 324, viz:

(1) Whether such housing programs would necessitate additional school

facilities ;

(2) Whether the communities adjacent to or near such yards, reservations,

and bases are financially able to provide such additional facilities as
needed ; and

g520 WASHINGTON HEARINGS

(3) Whether the Federal Government should provide such additional facili-
ties of the community.

SURVEY OF EXISTING SCHOOL FACILITIES

In December 1940 the Office of Education sent to State superintendents and
commissioners of education a form and instructions for collecting information
for evaluating the adequacy of existing school facilities and for preparing esti-
mates of facilities needed to accommodate children of school age of personnel
connected with projects essential to the defense program. Representatives of
the chief State school officers cooperated with local school authorities in obtain-
ing the information.

In brief, the inquiry form sought the following information :

(1) The number of additional pupils that coidd be accommodated (as of

December 1, 1940) by existing school facilities.

(2) The number of additional families and of children of school age esti-

mated in terms of available information on proposed housing units.

(3) The number of additional teachers required.

(4) Needed school plant facilities for increased school population.

(5) Estimated amounts of funds needed for school plant facilities (includ-

ing school sites) ; for operation and maintenance of these facilities;
for transportation facilities (including equipment and cost of opera-
ation and maintenance) ; and for salaries of teachers required.

REPORTS OF ESTIMATED NEEDS

Reports of estimated needs, submitted to the United States Office of Educa-
tion, pointedly show that there is an imperative need in many localities for
school facilities to accommodate children of personnel connected with activities
essential to the national-defense program, and that, in defense areas many local
school administrative units faced with the problem of providing immediately
school plant facilities and teachers for a large number of additional children
of school age, are without authority to obtain through regular channels addi-
tional funds for these needs. Many of these units cannot, at least for the next
school year and in some instances for following years, provide funds for re-
auired capital outlay and current expense purposes.

Local school administrative units, in common with other local governmental
entities, must conform to legal limitations regarding maximum bonded indebt-
ness for school purposes and the maximum local tax on property that may
be levied —

(a) For interest on and reduction of bonded debt (for school purposes), and
(ft) For current or operating expense.

A reduction in tlve tax base of a local school administrative unit reduces
the tax income (for scliool purposes). This results when property is acquired
by the Federal Government. In some instances, public-school authorities have
no recourse in the matter of obtaining increased local funds, because tlie
additional children live on property of the Federal Government or on property
of industrial concerns not a part of, but adjoining, the local school adminis-
trative unit or units involved.

In local areas affected to an appreciable extent by defense activities the
need for housing (family dwelling) units, public and/or private, has been
recognized. The influx of personnel connected, and to be connected, with these
activities is, according to estimates submitted to tlie United States Office of
Education, generally expected to bring into these areas more children of
school age than can be accommodated by existing school facilities. These
estimates in effect indicate that we may expect from 300,000 to 850,000 such
children without adequate physical plant facilities and/or instructional services
wlien schools open this fall.

The findings of the study of school needs in defense areas pointedly show —

(a) That school plant facilities should be planned and constructed at the
time that family housing facilities, public and private, are pro-
grammed and built ; and

( h ) That the Federal Government, as the responsible agency for the removal
of school children into localities, few of which can provide adequate
school facilities for them, has a definite responsibility in assisting

NATIONAL DEFENSE MIGRATION 6521

States and their respective local school administrative units (at and
near defense areas) in providing for educational facilities for these
children.

PLAN FOR FINANCING NEEDED EXPANSION

In his official report filed January 21, 1941, the United States Commissioner
of Education recommended the following plan for paying the cost of school
needs in defense areas.

1. For children residing on public property the Federal Government should

bear the cost of required capital outlay and current expense except
that when such property is liquidated, a pro rata part of the cost should
be assumed by the local school administrative unit or units involved.

2. For children residing on private property not subject to immediate tax-

ation the Federal Government should lend to the local school adminis-
trative unit tlie required funds for capital outlay and current expense
that cannot be derived locally until the property in question appears
on the tax rolls, except that during the non-tax-produciug period the
Federal Government should pay, in lieu of taxes, its pro rata part of
the current expenses.

Hearings on H. R. 3570, calling for "community facilities," including schools,
were held in March by the House Committee on Public Buildings and Grounds.
On April 2, the chairman of this committee reported out H. R. 4-545 "to provide
for the acquisition and equipment of public works made necessary by the
defense program." This bill "public work" to mean "any facility useful or
necessary for carrying on community life," and states "but the activities
authorized under this (title II) shall be devoted primarily to schools, water-
works, works for the treatment and purification of water, sewers, sewage,
garbage, and refuse disposal facilities, public sanitary facilities, hospitals, and
other places for the care of the sick, recreational facilities, and streets and
access roads."

H. R. 4545 was passed by the House of Representatives May 9, 1941. and
was referred to the Senate Committee on Public Buildings and Grounds. Hear-
ings were held by the Senate committee on May 19 and 20, and on June 9 the
committee reported the bill with amendments, passed by the Senate on June
12, but rejected by the House on June 19. After sjibmissiou to conference, the
House finally adopted H. R. 4545 with Sepate amendments and the Senate
accepted it on June 27, 1941. The bill as signed authorizes the appropriation
of $150,000,000 for public works, as previously defined, and is in effect an
amendment to Public Act 849, which provides Federal funds for family housing
for defense workers.

Earlier I stated that estimates in file in our Office pointed out that from 300,000
to 350,0(X) children of school age would find themselves in September in localities
without adequate school facilities, i. e., without school buildings and teaching
personnel. I wish to emphasize that I am referring to the status as of May 15,
when the official statements were filed at the hearings on H. R. 4545 of the
Senate Committee on Public Buildings and Grounds. Estimates as of that date
were based, in the main, on the number of additional family-dwelling units
(defense housing) with funds then available. As additional funds are made
available from public and private sources, the number of additional families and
the consequent number of additional children of school age that may be expected
in concentrations of population because of activities essential to the national-
defense program will be correspondingly increased. We must recognize that the
situation with reference to shifting of population because of defense activities
is changing from day to day. Findings of today are having to be adjusted to-
morrow. Our estimates of need represent, therefore, those situations with de-
fense activities in such advanced stages of development that we can definitely
determine actual conditions of need for additional school facilities, say as of
September and October. We recognize that in numerous other situations with
defense projects in early stages of development actual conditions of need cannot
be definitely determined for 3, 6, or 9 months with the exception that we are
fully aware of possible and even likely urgent needs occasioned during the con-
struction periods by families living in trailer units and in summer-resort cottages
(generally located with no reference to schools) and in other instances by a sec-
ond family sharing living normally occupied by only one family.

On the basis of estimates referred to, there is needed approximately
$1.30,000,000. Of this amount from $110,000,000 to $150,000,000 will be required

g522 WASHINGTON HEARINGS

for capital outlay, including school buildings and equipment, school sites when
not already available, and transportation equipment; and $15,000,000 to
$20,000,000 for operation and maintenance of school buildings and transporta-
tion provided by Federal funds and salaries of teachers and other instructional
costs.

As indicated earlier, estimates of needed school facilities that have been sub-
mitted by State and local school authorities are on file in the United States Office
of Education. These authorities are now carefully reviewing and critically evalu-
ating these estimates so as to be ready to certify actual conditions of need with-
out delay. Time is an important factor because school facilities for the children
involved are urgently needed in many localities when school opens in September.
Field representatives of the Office of Education are rendering every possible assist-
ance to States and localities in their respective efforts to project actual conditions
of need. It is hoped that rules and regulations required for the administration of
the program will now be formulated without delay.

TESTIMONY OF H. F. ALVES— Resumed

Mr. Curtis. Now, in your paper you cite the figure of 300,000 to
350,000 children for whom added facilities will be required. Now I
take it that that figure refers to that many new pupils in defense
areas. Do you feel that is a conservative or liberal estimate?

Mr. Al\tes. I should say that it is a fairly conservative estimate
for this reason : The number of additional children in a defense
area — in the respective school administrative units in that area — is
based on the influx of additional families which, to a great part, is
determined by the additional number of family dwelling units built
or being built in those areas.

As of May 15 there was available Federal money from Public
Act 671, Public Act 781, and Public Act 819, totaling approximately
$435,000,000, on an average of $3,000 per family dwelling unit, which
I believe is about the average figure set in 849. That would repre-
sent somewhere around 130,000 to 140,000 Federal houses built and to
be built for additional families coming into a community.

On the basis of figures submitted to our office from 196 areas, as
I recall, we find that the ratio of private houses built to Federal
houses at that time was about 2 to 1. If we figure that for 130,000
Federal houses, there were roughly twice as many private houses
built — I mean houses paid for by private capital — that would run
close to

Mr. Curtis. That is private housing or is that for housing de-
fense people ?

Mr. Alves. That is right, as a part of the defense housing pro-
gram. That will run somewhere around 350,000 to 400,000 addi-
tional family dwelling units that either were in process of construc-
tion, had been constructed, or were ready for construction on the basis
of funds available as of May 15.

And on that basis again, we figured only one child of school age
per family, although the average on them is slightly under, but
200 defense areas reporting showed 1.3 to 1.4 average number of
children of school age per family. But we figured only one and
that is the reason I make the statement I think it is a conservative
figure, with roughly 350,000 to 400,000 houses under the defense
housing program. An average of one child of school age, it would
make appear that figure of 300,000 to 350,000 is conservative.

NATIONAL DEFENSE MIGRATION 6523

DISTRIBUTION OF NEW DEFENSE HOUSING

Mr. Curtis. Now, for the most part, are those defense houses put
off in new neighborhoods by themselves or scattered throughout the
cities near where the plant was located?

Mr. Alves. I wouldn't attempt to answer that question, because
for the most part I don't know_j^ but I do know that they are sup-
posedly being located in accordance with available existing com-
munity facilities, if it is possible.

That would mean by implication that the houses are located near
concentrations of populations, rather than in areas where there is
no concentration, because in the last case you would find fewer, if
any, community facilities such as sewers, hospitals, schools, and
the like.

Mr. Curtis. I have in mind one midwestern city that is having a
bomber plant built in it.

Mr. Alves. Yes.

Mr. Curtis. People are coming in there and occupying new houses
that are scattered throughout the city on vacant lots. That being so,
the school system can absorb the entire increase because there will be
a few of those pieople in each of the various wards of the city and a
small number in each room of the various ward schools ; could they
not?

Mr. Al-\t:s. I would say that it certainly the essence of got»d plan-
ning to do that.

Mr. Curtis. But if the housing authorities planned a project away
from the city, that would put all these defense workers together and
in that case there would be many new pupils, all in one place, and
consequently complete facilities would have to be provided.

Has the Office of Education taken any position in regard to which
of the two types of housing they prefer ?

Mr. Al'S'es. Of course, our position has been very definitely that if
it is at all possible, existing school facilities should be utilized.

But, of course, our office has taken no responsibility or assumed any
authority in the placement of defense housing projects.

COST OF SCHOOL CONSTRUTION

Mr. Curtis. Now, the figures that you refer to school children, that
is both grade and high-school pupils?

Mr. Alves. Yes, sir. Of that number, roughly, 30 to 35 percent
under a normal distribution may be expected to be in high-school
work.

Mr. Curtis. If the Federal Government paid the whole bill for
350,000 children, what is your estimate of the cost?

Mr. ALi-ES. You would have to qualify whether you want a figure on
the basis of permanent school building construction.

Mr. Curtis. You quoted a figure of $130,000,000. Wliat does that
include ?

Mr. Alves. That includes, as I indicated in my statement, a dis-
tribution of about $110,000,000 to $115,000,000 required for capital
outlay. That includes school buildings and necessary building equip-

0524 WASHINGTON HEARINGS

ment; school sites when not ah-eady available and transportation
equipment. Capital outlay would run from 110 to 115 million dollars.

The remainder, from 15 to 20 million dollars, according to the esti-
mates submitted, will be required for the operation and maintenance
of the school buildings and the transportation provided by Federal
fimds, and for salaries of teachers and other instructional costs foi
these additional children if those amounts cannot be included in the
current budgets.

Mr. Curtis. Now, under your capital outlay, does that constitute
permanent structures or temporary structures'?

Mr. Alves. It includes both.

Mr, Curtis. If permanent structures are built, does the Federal
Government pay the entire bill?

PLAN FOR PAYING FROM FEDERAL, FUNDS

Mr. Alves. That involves a plan for paying the cost which, as far
as I know, has not been definitely established or accepted in the Com-
missioner's official report submitted and found in Senate Document
No. 20. It is also found in the report of the House Committee on
Public Buildings and Grounds in its hearings on 3570, and in the
Senate hearings on H. K. 4545.

In that you will find a plan for paying the cost of needs.

Mr. Curtis. Needs of what — elaborate on that — what do you
mean by that ?

Mr. Alves. The Commissioner's official report states this :

For children residing on public projaerty —

and we are talking always about children connected directly with
defense, whether they are children, of Army officers, of noncom-
missioned officers or of naval officers, or children of airplane-factory
workers or munition-factory workers —

exempt from local and State taxation, the Federal Government should bear
the cost of required capital outlay and current expense, except that when such
property is liquidated a pro rata part of the cost should be assumed by the local
school administrative unit or units involved.

I will state the second part of that plan and then go back and
qualify both, if I may. For children residing on private property
such as private defense housing projects, not subject to immediate
taxation, the Federal Government should lend to the local school
administrative unit the required funds for capital outlay and current
expense that cannot be derived locally until the property in question
appears on the tax rolls, except that during the nontax-producing
period the Federal Government should pay in lieu of taxes its pro
rata part of the current expense.

THREE SAMPLE SCHOOL-FINANCING PROBLEaiS

Now, if I may go back I will take 3 example communities — A,
B, and C. In each of the communities may we assume that we have
identical situations to start with. Each has an influx of 1,000 chil-
dren of defense workers of one type or another. May we assume
further that each of the communities has bonded itself for school
purposes to the maximum and, incidentally, about three-fourths of

NATIONAL DEFENSE MIGRATION 6525

all the school districts in defense areas find themselves just exactly
in that position.

Here are the 3 communities — A, B, and C, each with an influx
of 1,000 defense children and each unable to ^ond itself any further
and each unable to levy any increase in local taxes for current or
operating costs.

In community A the thousand children live in Federal houses,
houses built by the Federal Government and placed on permanent
Federal reservations. There are a thousand houses built as a result
of defense activities, and these houses are paid for by the Federal Gov-
ernment and are located on permanent Federal reservations — ^they
are permanently exempt from local and State taxation.

In community B, because there was no room available on the
permanent Federal reservation, the thousand houses built by the
Federal Government were placed, let us say, on a 150-acre tract
bought by the Federal Government adjoining the reservation. They
are now exempt from taxation. How long they will be I don't
think any of us know. I think we are all agreed, however, that the
Federal Government will probably not stay in the real-estate business.

Mr. Curtis. I hope not.

Mr. Alves. So eventually these houses will be liquidated. Now,
when they are liquidated, whether it be 18 months from now or
5 years from now, then we will increase the tax base of that local
school governmental entity so that it may assume an added obliga-
tion for capital outlay purposes.

Now, in community C the Federal Government didn't have to build
an3' Federal houses because private capital was willing to assume
the risk, so there we find the 1,000 chiklren living under 1,000 roofs
paid for by private capital, subject to taxation, but in the average
State it requires from 18 month to 21 months for such new properties
to get on the tax roll and produce a tax income.

My assumption was that neither of the three districts could bond
itself today.

A TRANSFER OF BFILDIXG TITLE FROM GOVERNMENT TO SCHOOL DISTRICT

In each of the three districts we have in September or in October
1,000 children waiting to go into a school building, with none avail-
able. We are all agreed there must be some provision by the time
school opens. The communities cannot vote any additional bonds,
so we will build the buildings, for the time being, out of Federal
funds.

Now, here are your questions involved: Community A never gets
any increased taxation base locally — ^bear in mind that school-building
projects in all States are the responsibilities and obligations of local
governmental units and not of States; States do not build school
buildings; that is a local responsibility, at least to date, under our
form of government. But community A will not get any increase
of its tax base, consequently it can't increase its bonded obligation.

There is a possibility of— not a likelihood — that that will have to
be a building built by Federal funds and put at the disposal of the
local district with, preferably I would say, the title transferred to the
school district.

g526 WASHINGTON HEARINGS

B — TRANSFER OF FEDERAL HOUSING TO LOCAL TAX ROLL

In community B we build the same buildings. Now when can com-
munity B absorb part of that cost? Only when those 1,000 addi-
tional houses get on the tax roll locall3^ I don't know when they will
get there. If those 1,000 houses, representing a total expendi-
ture of at least $3,000,000, should be liquidated — that is transferred
to private ownership — 12 months from now, it is quite obvious that
the increased tax base from those 1,000 houses 12 months from now
would be considerably greater than it would be 5 years from now.

Mr. Curtis. May 1 interrupt you at that point? It is entirely
possible in some cases they won't need a school; isn't that true?

Mr. Alves. My assumption is you have no existing school facilities
and you had to jDrovide the same thing in each of the three com-
munities. The point is. community B cannot obligate itself any more
because it is already obligated to the limit the law allows. It can do
so only when it gets an increased tax base, and it will get that in-
creased tax base only when those 1,000 houses become private prop-
erty.

If they become private property 12 months from now the $3,000,000
outlay may result in a $2,000,000 increased tax base. If they don't
go on the tax roll for 5 years maybe the increased tax base will be
only six or seven hundred thousand dollars. But certainly the dis-
trict could be held responsible to help, to the extent that it gets an
increased tax base from the property.

0 — FEDERAL LOANS TO LOCAL DISTRICT

Now, in community C the children live in private houses which will
go on the tax base as soon as the existing procedure permits — it
might be 18 months, but in the meantime you do need schools, so they
are built.

Our contention is that in that case — our proposal rather is that in
that case the Federal Government should lend to the local district, just
as it does in effect to the community B, but that under no condition
should a school district, simply because it has kept its financial house
in order during the past 10 years, be asked to accept an obligation,
which after the emergency may be a white elephant on its neck.

We have some examples from the World War as a result of that type
of procedure.

Our whole idea is that there ought to be, in spite of the fact that
this is an emergency program, as much equity as we can possibly get
into such a program.

As you can quickly see, there are factors and conditions which will
help determine whether this school need now should be declared to
be a permanent or temporary one. All I can say is that that thing is
full of headaches.

Mr. Curtis. It is true the community involved, whether it is A, B,
or C, receives the additional business and pay rolls and the ordinary
money turn-over by reason of the location of that defense industry
there"; isn't that true?

Mr. Alves. Correct.

Mr. Curtis. And it is also true that for the most ])art the community
sought out the Federal Government and asked them to locate that at
that place ; isn't that true ?

NATIONAL DEFENSE MIGRATION 6527

Mr. Alves. I am sorry I can't answer that, but I expect you are right.

Mr. Curtis. I think most of the Congressmen have calls at their
offices quite frequently in that regard.

Now, on the basis of the amount of money that you discussed, what-
ever portion you get of this $150,000,000, wouldn't take care of the
situation, would it?

Mr. Alves. No, sir ; it will not.

Mr. Curtis. You can't build any permanent buildings between now
and the 1st of September, either ?

Mr. Alves. We cannot.

Mr. Curtis. Then what will they do?

Mr. Alves. Well, until we have set forth the rules and regulations
under which, or by which, all agencies involved will be guided, that
question cannot be definitely answered.

SCHOOL SITUATION IN FIRST WORLD WAR

Mr, Cltitis. What was the experience in the last war in regard to
this tiling?

Mr. ALy-ES. Relatively negligible, compared to the situation at this
time There were some few buildings built — not a great many.

Mr. Curtis. In those places where buildings were not built, have you
checked the attendance records and the promotion records and so on,
to see to what extent the pupils suffered ?

Mr. Alves. Yes; and I can speak from personal experience because
I happened to grow up around an Army post — Fort Sam Houston in
San Antonio, Tex. The situations, so iar as I can compare them in
the first place, was not nearly as aggravated. There was not nearly
the concentration of population we have today, especially so far as
industry goes.

The general procedure followed was a doubling up, which is already
going on in many school systems in defense areas today — half-day ses-
sions or what we call "a staggering of the daily schedule," with the
result that you can increase the load from 25 to 50 percent without any
real harm to the pupils, unless it is continued for many years.

To give you an indication that that is already being recognized,

I recall a high school that was built for about 1,200 pupils. Last March
that high school with a capacity of 1,200 had 1,700 actually going to
school in it. This fall, by October, they expect an additional 800.
Now, you do reach a saturation point, so far as doubling up or running
parallel programs are concerned.

When you get to the lower-age levels — children 6, 7, 8, 10, and up to

II years old — it isn't very practical for a number of reasons to have
one session from 8 to 2 and another one from 2 to 7 at night.

All those factors are being recognized.

WATS OF handling TEMPORARY SCHOOL SHORTAGE

Now, in answering your question how, since we can't build a per-
manent building by October, Avill we take care of the situation. There
isn't any way to do it, except to double sessions for one thing, and, if
necessary, to use some Sunday school rooms and maybe rent some
rooms to put in the additional teachers.

The significant thing really is here though — it is a matter of finances.
Local school budgets in most States are prepared by this time of the

H— pt. 16 15

5528 WASHINGTON HEARINGS

year, under existing laAvs. The funds that a locality may derive for
school purposes are funds received as a result of a levy for this fiscal
year and no change in that levy can be made for one fiscal year. Simi-
larly State school moneys come from legislative action in most States,
and practically all States are on a biannual basis, so in those cases there
are difficulties encountered in financing additional teachers in those
localities.

Mr. Curtis. But in most cases a district is not bound firmly bv the
budget estimates submitted when the levy was made ; are they? They
can go ahead and create obligations and issue warrants; can't they?

Mr. Al\t:s. I would say, by and large, that doesn't work like it did
10 or 12 years ago. We had a terrible experience, as you may recall,
during the depression when school districts as other governmental
agencies issued warrants — anticipation warrants — with the result that
the first thing we knew they had pledged alread3^ this year, all the
money they might expect next year, so we had a write-off campaign ;
which you probably recall.

Mr. Curtis. I will admit it is bad practice, but what I meant to say
was to get around the emergency for a matter of a few months. That
could be done, couldn't it?

Mr. Al\tes. Well, what is the use of doing it if you have no increased
tax income locally ?

Mr. Curtis. I am not advocating it as a remedy for this ; don't mis-
understand me. I am thinking about the date when school starts and
the kids are at the door and we haven't done anything.

Mr. Alves. Your point is with the assurance on the part of the
locality that even though it does not have the money on hand on the
opening day but may expect it, it can proceed; that is correct.

Mr. Curtis. Now, Mr. Alves, you have given us a long paper which
will go into the record in its entirety. This is one of the matters thnt
I have thought about a great deal. Without a doubt, the Federal
Government does have an obligation in these places.

Mr. Alves. Yes.

Mr. Curtis. And the local community has some and we may never
agree on just where to draw the line as between the two?

Mr. Alves. Yes; it ought to be as nearly equitable as humanly
possible.

Mr. Curtis. That is all, Mr. Chairman.

Mr. Alves. I was going to make two statements, if I may. resulting
from your questions and statements.

Mr. Curtis. Go ahead.

Mr. Alves. The Congressman referred to the fact that these locali-
ties would enjoy an increased business because of an influx of popu-
lation. That is true, but that increased business is not the basis for
voting bonds for capital outlay purposes. That is a matter of a tax
base and I don't think we want to confuse the two. As a matter of
fact the tax income from the increased business activities goes to the
State as the agent of Government rather than the locality. I just
wanted to be sure that that got into the picture.

funds available under lanham act

Now, with reference to existing Federal funds under the so-called
Lanham Act, for community facilities. I am sure that the committee

NATIONAL DEFENSE MIGRATION 6529

knows that at the time of the hearmgs we added to the estimates in
other fields around $300,000,000. We have had $150,000,000. If the
$300,000,000 is anywhere near accurate you can quickly determine a
ratio.

The fact is that there is a request before Congress for an addi-
tional $300,000,000 for defense housing and that title VI of F. H. A.
has been made considerably more lenient.^ Recently I saw a state-
ment to the effect that there was then anticipated need over and
above all housing already planned of an additional 600,000 houses.
If that $300,000,000 for additional Federal housing is appropriated
and, correspondingly, private capital under the insurance clause of
the Federal Housing Act builds the ratio anticipated, it means by
the time you have completed 600,000 additional family dwelling units
over and" above those now planned or under construction, you can
expect another child of school age, for each family occupying one
of those units, to come into the picture.

The Chairman. Our record will be kept open for a week or 10
days and if you could submit to the committee a statement showing
what figures you have obtained from various defense centers with
reference to the increase in teacher load and facilities, we will be
glad to incorporate it with your statement.

Mr. Alve-?. Does the chairman mean a list of defense centers^

The Chairman, I think that is what we have in mind. It doesn't
liave to be done today.

Mr. Alves. I don't think we can do that now for this reason, and
I want to be sure that it isn't understood we don't want to. We
would like to but right now we have in the field eight representa-
tives of the office who are going into the localities with representa-
tives of State departments of education, and with the assistance of
every possible agency we can persuade to help. We are squeezing
tlie water out of these estimates and some of them liave a little water
in them.

Now, whatever list we could prepare today or tomorrow wouldn't
be any good anyway because, although these men are going at it
rapidly, they are not yet near finishing. And furthermore, in get-
ting the administration of H. R. 4545 going, as you probably are
aware, the W. P. A. has men in the field, regional directors and field
men, and they are going into the localities and, wherein a given
locality you have a given situation today, it might be quite differ-
ent tomorrow, because everybody is actively at work trying to de-
termine the actual conditions of need. I am afraid it is almost an
impossibility.

The Chairman. We realize the situation. We thank you very
much.

Our next witness is Mr. Robert C. Weaver.

TESTIMONY OF ROBERT C. WEAVER, CHIEF. NEGRO EMPLOYMENT
AND TRAINING BRANCH, LABOR DIVISION, OFFICE OF PRODUC-
TION MANAGEMENT, 'WASHINGTON, D. C.

The Chairman. Mr. Weaver, Congressman Osmers will interro-
gate you.

1 Text of "Title VI, Defense Housing nisurance," appears in Washington, pt. 17, July 18.
19. and 21, p. 6960.

^530 WASHINGTON HEARINGS

Mr. OsMERS. Mr. Weaver, would you give your name and posi-
tion to the reporter for the record ?

Mr. Weaver. Kobert C. Weaver, Chief of Negro Employment and
Training Branch, Labor Division, Office of Production Management.

STATEMENT BY ROBERT C. WEAVER, CHIEF, NEGRO EMPLOYMENT
AND TRAINING BRANCH, LABOR DIVISION, OFFICE OF PRODUCTION
MANAGEMENT

Racial Discrimination in Employment in National-Defense Industries

Field investigations by members of my staff in the Negro Employment and
Training Branch of the Office of Prodnction Management indicate that arbitrary
employment barriers erected against Negroes and other minority groups in
certain defense industries have increased the unnecessary migration of workers
into some defense areas. This widespread exclusion of minority groups from
participation in defense production has multiplied civic and social problems
in various communities by placing additional burdens on the housing, school,
police, and fire-prevention facilities of these municipalities. At the same time,
these practices have tended to retard the progress of our defense effort by
making impossible the total utilization of our human resources.

A few typical incidents will illustrate this situation. In Hartford, Conn.,
for instance, where an increasing shortage of skilled workers was evident this
year, holders of defense contracts not only refused to employ competent and
available Negro workers but also barred Negro youths from defense training
programs after the available supply of white youths had been exhausted. While
maintaining this ban against Negro workers — thereby increasing the percentage
of Negroes on the relief rolls — these employers advertised throughout the
country for white workers to come into the Hartford area.

This situation was duplicated in Los Angeles, where large-scale defense pro-
duction is under way. Outside workers were imported into this area by the
thousands while qualified and available Negro workers were denied the oppor-
tunity to lend their skills and aptitudes to the defense effort.

During the construction of a camp near Petersburg, Va., hundreds of avail-
able Virginia Negro carpenters were barred from employment on this project
while thousands of white carpenters from all parts of the country were im-
ported to the site for employment.

Similar practices may result in a heavy influx of outside labor to the Baltimore
area this year. A recent survey conducted in that city revealed that approx-
imately 40 percent of the male labor reserve of Baltimore is composed of
Negroes. Assuming that only one-third to one-half of the Negro labor reserve
under 45 years of age could qualify for training courses, from 3,000 to 4,500
additionnl trainees would be made available for defense industries in that area.
Conversely, the failure of defense contractors to utilize this potential labor re-
serve will raise the number of in-migrants to Baltimore from 3.000 to 4.500
with a resultant increase of the housing, school, police, and fire-prevention needs
of the community.

ATTITUDE OF MANAGEMENT

Many factors contribute to this widespread practice. One important factor is
the attitude of management — both top and supervisory — toward ttie situation.
Some presidents and directors of vital defense industries have refused to take
any cognizance of the problem. Others, in isolated instances, apparently have
permitted their own emotional bias to influence the employment practices of
their companies. Practices of this nature, however, are more prevalent among
the superintendents and foremen in defense plants. These men usually establish
the practices and draw up the specifications through which workers are hired,
and their lack of provision for the integration of quidified Negro workers has
been accepted without question by management and labor alike.

ATTITlT^y. OF ORGANIZFD LAROR

Another important factor in this picture is the attitude of organized labor
toward the integration of organized Neg^-o labor into our defense efforts. Al-
though only a limited number of international unions bar Negroes by ritual or
constitutional bans, scores of small local unions establish barriers against the
employment of qualified Negro workers.

NATIONAL DEFENSE MIGRATION g53X

A typical instance where such a practice affects the problem under considera-
tion occurred recently in Illinois. Hundreds of skilled Negro workers, many
of them holding union membership, were barred from construction work on a
large powder plant project near Chicago seemingly because the business agent
of certain local unions in the nearby town refused to give clearance to these
qualified Negro workers. While we have been able to correct the situation in
many trades, these bans have been maintained in several crafts despite the
crying need for skilled workers in these categories. At the same time, the
local unions involved are calling skilled white workers from other jobs, some of
them defense projects, no doubt, in various parts of the country in an attempt
to fill the labor needs on this particular project.

GENERAL ATTITUDE OF WHITE EMPLOYEES

A third factor which may influence the picture is the general attitude of
white employees toward the introduction of Negro workers into industry.
While this factor undoubtedly does play a part in the formulation of ex-
clusionist policies, it is often exaggerated by employei's in their refusal to hire
Negro workers. One large construction engineering firm, for instance, refused to
use skilled Negro building trades workers in the erection of a powder plant
in the Middle West. The construction manager for this firm defended this
practice by saying that "white and Negro artisans would not work together in
this section of the country." He refused to alter his position even when it was
pointed out to him that subcontractors on this very construction job were using
hundreds of Negro and white skilled workers and working them side by side.
As a result of his arbitrary position on this question, hundreds of additional
Negro skilled workers in the area were denied employment opportunities at
the very time that the construction manager frantically sought white workers
from other sections of the country.

I do not believe that I can stress too much the economic waste, and the
dangers to our national unity, which result from such practices. There is no
general formula by which thousands of local situations may be solved. There
Is, however, in almost every community and in most industries objective evi-
dence that available local labor resources are being ignored while frantic efforts
are being made to lure outside workers into defense communities. This Is a
problem which both management and organized labor must face, and one for
which both must seek a solution. In view of the current emergency, it is a
problem which deeply affects the entire American economy.

(The following exchange of correspondence, which took place sub-
sequent to the hearing, has been made a part of the record in accord-
ance with instructions of the chairman.)

[Copy]

July 23, 1941.
Dr. Robert C. Weaver,

Chief, Negro Employment and Training Branch,

Labor Division, Offiee of Production Management, Washington, D. C.

Dear Mr. Weaver : You may already have seen a statement released to the
press by Mr. Noel Sargent, secretary of the National Association of Manu-
facturers, on July 18, 1941, in connection with his appearance before this
House committee. In this release he referred to your testimony and said, "I
respectfully submit that the committee, entitled to and obligated as it is to
consider all available facts, should ask Dr. Weaver to submit the following
additional data simultaneously with the names of the manufacturers of whom
he complains." I am attaching on a separate memorandum the list of these
data and am forwarding this to you with the request that you will add this
to the list of names of those manufacturers whom you mentioned in the course
of your testimony before us.

At the time of Mr. Sargent's appearance before the committee it was agreed
by the committee that we should ask you to supplement your testimony with
this additional material in order that we might keep the record straight. We
will hold the committee record on this hearing open for a period of 10 days
or until August 1 for the receipt of this material from your office. If you
have any further questions with respect to this request, will you communicate
with the office of the staff director. Dr. E. K. Lamb.

0532 WASHINGTON HEARINGS

May I take this opportunity to thank you and Mr. Hillman for the arrange-
ment to have you appear before this committee to present the comprehensive
testimony that you gave us on July 17.
With all good wishes, I am,
Sincerely,

John H. Tolan, Chairman.

[Enclosure]
DATA to be asked OF DR. ROBERT C. WEAVER

I respectfully submit that the committee, entitled to and obligated as it is
to consider all available facts, should ask Dr. Weaver to submit the following
additional data simultaneously with the names of the manufacturers of whom
he complains :

1. A list of all unions, international, national, and local, of which he has
or secures knowledge, which refuse membership in their organizations to
Negroes ;

2. An analysis showing the proportion, in unions which do admit Negroes to
membership, and such Negro membership to that of white workers ;

3. A statement, in his ufRcial capacity as chief of the branch of Negro Em-
ployment and Training of the Office of Production Management, showing what
studies have been made of the actual or probable effect on Negro employment of
"closed shop" contracts recommended or ordered by the Defense Mediation
Board, or the National Labor Relations Board, and negotiated by unions barring
Negro members.

JtTLY 29, 1941.
Chairman of Housing Committee

Investigating National Defense Migration.

Washington, D. C.

Dkar Sib: During my appearance before your committee on July 16, 1941,
you asked me to furnish you certain information about American trade-unions
which bar Negroes from membership.In this connection I would like to call
your attention to the Handbook of American Trade-Unions, Bulletin No. 618,
issued in 1936 by the Bureau of Labor Statistics of the United States Depart-
ment of Labor.

Concerning this problem this official publication of the United States Depart-
ment of Labor cites the following constitutional qualifications for membership
in the following international unions :

Airline Pilots Association (American Federation of Labor), Page 241: "Any
moral person of the white race of lawful age and good moral character * * *."

Brotherhood of Railway Clerks (American Federation of Labor), page 251:
"Any white person, male or female, of good moral character * * *."

Brotherhood of Railway Carmen (American Federation of Labor), page 180:
"Any white person between the ages of 16-65 years."

Brotherhood of Dining Car Conductors (Railway Brotherhood), page 252:
"An applicant for membership must be of the Caucasian race."

Grand International Brotherhood of Locomotive Engineers (Railway Broth-
erhood), page 259: "No person shall become a member of the Brotherhood of
Locomotive Engineers unless he is a white man 21 years of age * * *."

Brotherhood of Locomotive Firemen and Enginemen (Railway Brotherhood),
page 262 : "Any worker within the jurisdiction who has served for at least 30
days, white, of good moral character, sober and industrious * * *."

Railway Mail Association (American Federation of Labor), page 311: "Any
regular mail railway moral postal clerk or certified substitute railway postal
clerk of the United States Railway Mail Service, who is of the Caucasian race,
is eligible for membership."

International Organization of Master Mates and Pilots of America (American
Federation of Labor), page 239: "Any white person of good moral charac-
ter * * *."

Switchmen's Union of North Amex'ica (American Federation of Labor), page
270 : "Any white moral person of good moral chai-acter * * *."

Order of Railroad Telegraphers (American Federation of Labor), page 281:
"Any white person of good moral character * * *."

Train Dispatchers A.ssociation of America (Railway Brotherhood), page 271:
"Any train dispatcher, white, of good moral character ♦ * *."

Brotherhood of Railroad Trainmen (Railway Brotherhood), page 274: "Any
white moral person between ages of 18-65 * * *."

NATIONAL DEFENSE MIGRATION g533

Railroad Yardmasters of America (Railway Brotherhood), page 277: "Any
moral white person of good moral character * * *."

Wire Weavers Protective Association of America (American Federation of
Labor), page 202: "Applicants for membership must be Christian, white, moral,
of full age of 21 * * *."

Order of Railway Conductors (Railway Brotherhood), page 25: "Any white
man shall be eligible to membership * * *."

Brotherhood of Sleeping Car Conductors (American Federation of Labor),
page 253 : "Applications for membership must be white, moral, sober, and in-
dustrious and must join of his own free will * * *."

Commercial Telegraphers Union of North America (American Federation of
Labor), page 282 : "Any wliite person of good moral character who is of 16 years
of age * * *."

International Brotherhood of Blacksmiths, Drop Forgers, and Helpers (Ameri-
can Federation of Labor), page 175: "Colored: Where there are a sufficient
number of colored helpers they may be organized as an auxiliary local and be
under the jurisdiction of the white local having jurisdiction of their territory ;
colored helpers shall not transfer except to another auxiliary local composed of
colored members and colored members shall not be promoted to blacksmiths or
helping apprentices and will not be admitted to jobs where white helpers are
now employed."

The Handbook of American Trade-Unions states further on this question :

"Constitutional requirements, however, do not in all cases cover the whole
situation and in extreme cases they may, as a matter of fact, actually control.
Rituals sometime contain phrases which by interpretation may exclude whole
classes and groups of workers, such as Negroes."

In your letter of July 23, you requested more detailed information relative to
Negro participation in labor unions. Among other things, you ask for a list of all
unions, international, national, and local, which refuse membership in their
organizations to Negroes. I have dealt with the international organizations
above. Since we are constantly in the process of dealing with the problem of
discrimination against Negroes on the local level, it is impossible to supply a list
which has any validity. As soon as instances of discrimination are called to
our attention, we communicate directly with the iinion involved, and in most
instances we have been successful in securing some adjustments. The basis
of our approach to this problem is an agreement of cooperation from the Amer-
ican Federation of Labor and Congi-ess of Indu.strial Organizations, which was
t^ecu^ed by the National Defense Advisory Council some months ago. I am
attaching for your information a copy of an announcement of this agreement.

It is impossible at this time to give any statistical break-down as to the
proportion of Negroes in unions. There are many organizations which have a
large number of Negro members and in which there is no racial break-down
either locally or nationally. In order to secure this information it would be
necessary to send questionnaires to each local of every union in the Nation.
The data so assembled would be incomplete and outmoded by the time it was
compiled.

The only information which I can supply relative to the effect on Negro em-
ployment of "closed shop" contracts recommended by various Government boards
would be general. As charges of discrimination in such cases are brought to our
attention we immediately investigate them and, through the facilities of the
Labor Division, attempt to secure an adjustment. Our approach to this problem
is similar to instances where we have charges of discrimination by industry.
I might say, however, that in light of the nature of the skilled supply of Negro
labor, most "closed shop" contracts with which we deal are in the building
trades occupations. Here we have made notable progress, as was indicated in
the placement figure cited in my prepared testimony. I can add, however, that
this matter of "closed shop" contracts and Negro exclusion is a real pi'oblem
facing us. Its intensity is modified, however, by the fact that, with the exception
of the building industry, in the majority of the defense contracts where Negro
employment is an issue, either industrial unions wh'ch are open to Negroes are
involved or there are not at the present time "closed shop" agreements.

I regret that it is impossible for me to answer definitely the questions which
were set for«:h by Mr. Sargent but the problem is of such nature as to preclude
detailed statements on these matters.

g534 WASHINGTON HEARINGS

In my testimony before your committee I stated that several industrial firms
had refused to en'iploy Negro production workers after they had been urged to
do so by representatives of our office. The North American Aviation, Inc., the
Consolidated Aircraft Corporation, the Fairchild Aviation Corporation, and the
Colt Firearms Co., at Hartford, Conn., are among this group.
I trust this information will be of assistance to your committee.
Sincerely yours,

[Signed] Robert C. Wea\'er,
Chief, Negro Employment and Training Branch,

Labor Division.

(The following correspondence also has been made a part of the
record:)

Exhibit B — On Companies Refusing To Employ Negko Production Workers

Office of Production Management,

Social Security Building,
Washington, D. C, August 5, 1941.
Hon. John H. Tolan,

Congress of the United States,

Washington, D. C.
My Dear Mr. Tolan : I have your letter of July 30 requesting a complete list
of industrial firms which have refused to employ Negro production workers after
they have been urged to do so by a representative of my office.

It so happens that in the majority of cases where we have been able to make
no progress in placement, management has not definitely refused to hire Negro
workers but has made promises of cooperation which have in many instances
not been followed. It was for this reason that the list which I gave in my
letter of July 29 was short. There are many plants which hire a few Negroes
and refuse to add any more, or which have promised to hire Negro production
workers but have refused to be definite as to the time of action. In light of
these facts I do not believe that a more detailed list would be accurate.
Sincerely yours,

[Signed] Robert C. Welwer,
Chief, Negro Employment and Training Branch,

Labor Division.

[Copy]

July 30, 1941.
Dr. Robert C. Weaver,

Chief, Negro Employment and Training Branch,

Labor Division, Office of Production Management, Washimgton, D. C.
Dear Dr. Weaver: Thank you for your letter of July 29* and for the mate-
rials it contains. Your letter will be placed in the records of the committee
as part of your testimony.

If I remember the request of the committee correctly in regard to the list
of industrial firms that had refused to employ Negro production workers, after
they had been urged to do so by a representative of your office, I believe that
we asked for a complete list of such firms. If it is possible for your office
to furnish such a complete list within the next 10 days, we can make it part
of our record.

We do not wish to emphasize the firms in the particular localities which
we investigated to date in contrast with other firms throughout the country wha
have refused to employ Negroes.
With all good wishes, I am.
Sincerely,

John H. Tolan, Chairman^

This reference is to letter appearing on p. 6.531.

NATIONAL DEFENSE MIGRATION 6535

[Copy]

August 8, 1941.
Dr. Robert C. Weaver,

Chief, Negro EmMoyment mid Trn'ming Branch,

Labor Division, Office of Production Management, Washington, D. C.
Dear Dr. Weaver : Thank you for your letter of August 5. In it you men-
tion that a number of firms have made promises of cooiieration which have
not been followed; would you submit for the record as complete a list as
possible of such firms?

In addition, you make a statement that several employers have promised
to hire Negro production workers but have refused to be definite as to the
time of action. The committee assumes that those firms who have promised
cooperation are sincere in their promises and that the inclusion in the record
of as complete a list of such firms as possible would in no way hinder the
important work of the Labor Division.
With all good wishes, I am.

Sincerely,

John H. Tolan, Chairman.

Office of Production Management,
Washington, D. C, August 18, 194L
Hon. John H. Tolan,

Congress of the United States,

Washington, D. C.
My Dear Mr. Tot.an : In response to your letter of August 8, I am attaching a
list of companies from which commitments have been received for the employ-
ment of Negroes. Those companies with the asterisk have already employed
Negroes in accordance with their promises. Other companies listed have made
commitments for the employment of Negroes in production capacities and we are
now in the process of following up these promises. This list is accurate as of
.August 15.

Sincerely yours,

[Signed] Robert C. Weaver,
Chief, Negro Employment and Training Branch, Labor Division.

LIST OF COMPANIES FROM WHICH COMMITMENTS HAVE BEEN RECEIVED FOR THE
EMPLOYMENT OF NEGROES

Ordnance:

Goodyear Engineering Corporation (Hoosier River Ordnance Works).

Houde Engineering Co.

Indiana Ordnance Works* (Du Pont).

Iowa Ordnance Plant (Day & Zimmerman). Plant now under construc-
tion.

Kingsbury Ordnance Works (Tood & Brown).

Lake City Ordnance Works (Remington Arms). Plant now under con-
struction.

Ohio River Ordnance Works (Atmospheric nitrogen).

Radford Ordnance Plant* (Hercules Powder Co.).

Ravenna Ordnance Works (Atlas Powder Co.).

St. Louis Ordnance Works (Western Cartridge Co.). Plant now under
construction.

United States Cartridge Co. (division, Western Cartridge Co.). Plant now
under construction.

Wolf Creek Ordnance Works (Procter & Gamble).
Aircraft industry:

Allison Division of General Motors.*

Bell Aircraft Corporation.*

Bendix Company.*

Brewster Aeronautical Corporation.*

Briggs Manufacturing Co.*

Curtiss-Wright Aircraft Corporation.*

g536 WASHINGTON HEARINGS

Aircraft indnstry. — Continued.

Douglass Aviation Corporation.*

Graliam Paige Motor Corporation.

Grumman Aeronautical Corporation.*

Hudson Motors.*

Lockheed Aircraft Corporation.

Packard Motor Car Co.*

Pratt & Whitney.*

Republic Aviation Corporation.*

Spartan Aircraft Co.

Sperry Gyroscope Co.*
Shipbuilding industry:

Consolidated Steel Corporation, Ltd.*

Cramp Shipbuilding Co.*

Federal Shipbuilding Co.*

New York Shiiibuilding Co.* (unskilled only).

Sun Shipbuilding Co.*
Garment trades:

Baniberger-Rointhal Co.*

Freuhanl' Southwest Uniform Co.*
Motor manufarturinff:

Autocar Co.

Continental Motors.
Miscellaneous:

American Telephone & Telegraph Co.*

Bauer & Black.

Bridgeport Brass Co.*

Cleveland Pneumatic Tool Co.

Eberhardt Manufacturing Co.*

Edward G. Budd Co.*

Emerson Electric Co.*

Fruehauf Trailer Co.

Goodrich Rubber Co.*

Goodyear Aviation Co.

Lacakawanna-Bethlehem Steel Corporation.*

Murray Body.*

Pressed Steel Co.

Radio Corporation of America.

Thompson Products Co.*

York Safe & Lock Co.

TESTIMONY OF ROBEET C. WEAVER— Resumed

Mr. OsMERS. I wonder, Mr. Weaver, if you would give to the com-
mittee a few typical community examples of discrimination against
Negroes ?

Mr. Weaver. Perhaps the most striking example is in the aircraft
industry. Take the west coast, in the southern California area,
where there has been a terrific labor requirement for the aircraft
industry in the last few months, with tens of thousands of workers
being recruited — many of them being recruited from out of the State
of California.

Mr. OsMERs. Where are they coming from principally, Mr. Weaver?

Mr. WexWer. Texas, I should say, from my information as to that
situation.

There were exactly four Negro production workers in the aircraft
industry in southern California a month ago when I was out there.
In the Los Angeles area there is a fairly large population, a popula-
tion from which, conservatively, several thousand trainees could have
been recruited and that population has been completely untapped
to date with the exception of the four that I mentioned.

NATIONAL DEFENSE MIGRATION g537

We have another situation in the same industry in Baltimore, Md.,
with the hirgest single labor demand tliere coming from an aircraft
manufacturing plant.

That plant is now increasing its employment rolls at a very rapid
rate. There is a dearth of training material in Baltimore at the
present time. The only reserve for trainees for production workers
is a Negro reserve.

TWO UNIONS REFUSING TO ADMIT NEGROES

Mr. OsMERS. What unions refuse to permit qualified Negro workers
to membership ?

Mr. Wea\'er. Well, that is a very difficult question to answer be-
cause the union policies are usually not national policies. I mean
you will find a given situation in one city and another situation in
another city. There are two A. F. of L. unons that I know of which
have constitutional provisions which would prevent Negroes being
members.

One restricts Negroes to helpers and only helpers in a shop, and
they cannot get any further than helpers. The other union, the
Carmen of America, say that for membership a person shall be white
and between the ages of 16 and 65 years.

Now, in other unions, in other internationals, there are instances
where there are rituals Avhich limit membership to white persons,
while the constitution says nothing about race restriction. The main
difficulty is not so much in the international or national requirements
as in local practices.

]\Ir. Osmers. Now, right on that subject. We had evidence given
to the committee that some white workers, particularly skilled work-
ers, refused to work with Negro workers. What do you think of
that argument?

Mr. Weaver. Well, I think that it is about 25 percent true. But
I will say this in explanation. As we track down these cases we have
employers say they will not hire Negroes because of union situations.
We go back and very often find that they have an open shop, so it is
absurd to say that it is a union requirement.

We go into cities where it is said they cannot hire Negro workers
as production workers because the white production workers will
walk out. Well, right down the street, in the same industry and
on the same processes, we find Negroes and white workers working in
tlie same occupation.

Now, there is no question that where you have created a new
industry and where that industry starts out discriminating and keep-
ing out any element of the population — they don't have to be Negro,
they can be au}^ other minority group — that that builds up in the
minds of the workers a vested interest which makes it more difficult
to introduce them at a later time. Although there are instances, as
in any time of a tight labor market, where those same people, who
claim they can't work together, find they will work together. We
have them working together in other places.

In other words a lot of it depends upon management's point of
view. If management were willing to plan for the thing and go about
it intelligently and with some degree of an over-all plan and point of

^538 WASHINGTON HEARINGS

view there would be no difficulty. In 25 percent of the cases it has
been done and is being done today without any difficult^;.

Now, there are certain situations in which if you inject a new
group suddenly without any preparation, you are apt to have diffi-
culty, but it depends there upon the way in which it is done. The
best proof of the pudding is in the eating of it and the test is that
there are companies in the same areas which are now doing the thing
successfully.

EFFORTS TO COMBAT DISCRIMINATION

Mr. OsMERS. Now, what efforts has your branch of the Labor
Division made to overcome this Negro discrimination and what
progress are you making ?

Mr. Wea\t:r. Well, we are doing two things. The first thing is
the thing we have been doing since the inception of the branch. We
have been there for about a year, first with the Defense Commission
and then, of course, transferred over to O. P. M. I have a relatively
small field staff and that staff goes into these industrial areas, works
directly with defense contractors and through its contacts has been
able to secure a modification of certain of these employment policies as
far as racial discrimination in employment is concerned.

The first thing we worked on was the construction of Army can-
tonments because that was, of course, the first big employment. We
were, I should say, relatively successful in that particular situation,
because we had had a great deal of experience. I had worked before
with the United States Housing Authority and I was able to borrow
some of the people who knew the construction game pretty well,
and we were able to go in there and work with the unions and in
many instances were able to secure Negro participation in unions
where they had never been before.

Mr. OsMF.RS. Which industry, Mr. Weaver, forms the biggest
stumbling block to your efforts — which single industry?

Mr. Weaver. That is very difficult to say because, on the surface,
from a statistical standpoint, you would say it is the machine-tool
industry, but that wouldn't be an accurate statement because in he
machine-tool industries you have so many highly trained workers,
and we do not have a large number of Negroes highly trained in that
industry.

Mr. OsiMERs. You mean the experience factor is not with your
Negro worker ?

Mr. Weaver. Yes ; that is true too.

Mr. OsMERS. I know if they are not allowed to start in industry
they can't get the experience. It is like the egg and the chicken.
Have training facilities been provided for Negroes in proportion
to their population ?

Mr. Weaver. No, sir.

EFFECT of defense PROGRAM ON MIGRATION FROM THE SOUTH

Mr. OsMERS. Has the migration of Negroes out of the South,
which has been so marked in the last few years, been accelerated
because of the defense program ?

Mr. Weaver. On the whole, I would say no. In one or two cen<
ters, you see, during the depression, migration declined quite a bit,

NATIONAL DEFENSP: MIGRATION 6539

but there are centers to which there has been a continued migration
of both Negroes and whites. Some localities attract them, just as
you have migration to California, which is sometimes entirely dis-
associated with any economic factor. For the same reason you have
migration of Negroes into certain areas in the North which have
glamour, I might say, to the populations back South.

But as far as industrial movement is cioncerned, that declined
during the depression and there is no evidence now of any appre-
ciable increase, with the exception of one or two centers which have
always had the glamour factor involved.

In that connection I should like to point out that our whole ap-
proach to this problem has been one of the employment of all avail-
able, qualified local labor. Our whole policy and procedure is based
upon the use of these people, not because they are Negroes but be-
cause they are a part of the local population; because they are al-
ready here, because schooling is already here for them, because
housing is already here for them, and ail of the other things that
go into that picture, both social and economic. Our whole pro-
gram has been one of using these people because they are local
labor and we are not interested and have not been interested in
any way in encouraging the movement of people from one section
of the country to the other.

Mr. OsMERs. What does the average Negro citizen feel about this
discrimination ?

Mr. Weaver. I think the average Negro citizen feels this discrimi-
nation more keenly than he probably feels anything else of a public
nature.

At least, since I have been conscious enough to know what they
are thinking and how they are feeling, I think that every Negro
organization and every Negro newspaper has agreed on the seriousness
of that situation and they have become almost united on what should
be done to solve it. That is a very significant thing and, of course,
it is all tied up with this morale problem.

EFFECT OF THE PRESmENT's ORDER

Mr. OsMERS. Do you think that the President's recent Executive
order will have any effect upon the situation?

Mr. Weaver. Yes; I think, obviously, that the future contracts
which will include a nondiscrimination clause will give us a great
deal more to work with, when we go to discuss this thing. At least
we will have some basis on which to base our negotiations and
approaches to the problem.

I don't think it will solve the whole problem, because obviously we
have got all these contracts which have gone before, which will not
be influenced by the nondiscrimination clause, and also the fact that
a clause in a contract is only the first step. It has got to be imple-
mented.

Mr. Osmers. Is that clause being written into all new contracts?

Mr. Weaver. I have checked with the Army and they have sent
out a directive that it should be included in all new contracts. I
am now checking \^ith the Navy, and the Coast Guard.

g540 WASHINGTON HEARINGS

Mr. OsMERS. I questioned a witness at our Baltimore hearings.
He was the representative of the BaUimore Urban League,^ and I
put that question to him, whether he thought it would be helpful in
his efforts, which are somewhat similar to your own, to nail it down
in a contract so that they had something to point to, something
definitely written in black and white that they could talk about, and
he thought that it would be helpful if they had that clause to work
on.

RECALCITRANT UNIONS

Now, just going back for a moment in your testimony, would you
care to name some of the unions that do exclude and bar Negroes?

Mr. WKtiLVER. Well, I would prefer to name the unions with which
we have the greatest difficulty because, with the exception of the
two which have these constitutional provisions, there are always
some exceptions.

It could be pointed out that in some one city this local admitted
our people whereas in maybe 95 percent of the other cities they do
not admit them.

The machinist union has been one with which we have had a
great deal of difficulty. The electrical union in the building trades^
those two would be outstanding.

Mr. OsMERS. Are they A. F. of L. or C. I. O. ?

Mr. Weaver. They are A. F. of L.

Mr. Osmers. Do you ever have any difficulty with other building
trade-unions ?

Mr. Weaver. Yes; locals, but it is very difficult to generalize. I
mean in one city we may have perfect accord with the trowel trade,
where we have the most favorable situation, yet we will go to
another city and maybe in the bricklayers' local union we will havu
the greatest amount of difficulty.

Mr. Osmers. I know in my State of New Jersey — and while this
committee was in Trenton we had evidence presented there — that
various building trade-unions in that State forbid memborship for
Negroes effectively, whether they do it constitutionally or not, I don't
know. They effectively prevented Negroes from becoming members.

Mr. Weaver. The difficulty with that, sir, is the fact that in New-
ark, when we were building the housing project there, we were able
to get Negroes in most of the unions, so any blanket statement of
that sort is very dangerous because you will get the exceptions which
will disprove your blanket statement.

Mr. Osmers. In a broad sense, would you say that the situation
is improving?

Mr. Weaver. I believe that, as far as the union relationship is con-
cerned, we are making progress with that.

discrimination against other groups

Mr. Osmers. Now, while I realize you haven't come here for the
purpose of discussing all discrimination, I wonder if you would
cite to the committee and for our record any other evidences of

1 See testimony of Edward S. Lewis, executive secretary, Baltimore Urban League,
Baltimore hearings, p. 009.".

NATIONAL DEFENSE MIGRATION 6541

discrimination against other races or groups or minorities in the
population?

Mr. Wea%t:r. Well, obviously our work is very closely tied up
with that of the other minority groups, because the problem, geneti-
cally, is the same problem. It is just a different expression of it. I
think perhaps the best way I can indicate that is to differentiate
between the Negro discrimination and the other groups by first
enumerating the other principal groups.

There has been discrimination against persons who are Jewish;
there has been discrimination against persons who are of Italian
parentage, though they may be citizens of two generations, but the
fact that their grandparents were Italian has been used against
them.

There was some discrimination, though not as much as one might
expect in the light of circumstances, in the cases of people of Ger-
man parentage. On the west coast there is quite a bit of discrimina-
tion against so-called Latin Americans or Mexicans,, depending upon
how they may use the terminology there.

Those have been the principal groups which have been discrimi-
nated against.

The Chairman. All of those groups, of course, were included in
the President's Executive order, were they not ?

Mr. Weaver. Yes, sir.

Mr, OsMERS. And you feel that progress is being made along those
lines ?

]\Ir. Wea\^er. There is this difference in those groups : There is
nothing like a national problem with them as there is in the case
of the Negro worker. You have one section of the country, let us
say in New England, where you get your anti-Semitism — where you
get a certain amount of discrimination against persons of Italian
parentage.

If you go into the Middle West you will have the same industries
in which you find none of that or no evidence of that particular
type of discrimination, so it is more difficult to get your fingers on
that problem from a national point of view.

We are, however, through Dr. Alexander's office, establishing con-
tacts in the field with these problems and are beginning to make
some progress, I believe, with them.

firms flatly refusing to hire negroes

Mr. Osmers. Have any firms refused to employ Negroes after a
direct request from your office?

Mr. Wea\t:r. Yes, sir.

Mr. Osmers. Would you be specific about them ?

Mr. WEA^T2^. I would prefer to get that and submit that later
rather than try to give it from memory.

Mr. Osmers. I wish you would do that for the purpose of the
record.^

Now, what is being done about providing additional training facil-
ities for Negroes?

Mr. Weaver. We have just put into effect a new, definite policy
in the training division of O. P. M. x^s you know, the idea has

See letters from Mr. Weaver, pp, 6533-6535.

g542 WASHINGTON HEARINGS

been to train in relation to the demands of industry. It has ahnost
gotten to the poi]it in many areas where persons are trained only if
it is sure industry will use them.

Well, you oet a vicious circle there, obviously. Negroes have not
been trained because the training people feel they couldn't be em-
ployed and the employment people said they couldn't get jobs for-
theln. We have now adopted a new policy, stating that in certain
communities where O. P. M. will go in and see there is going to be-
a growing demand for workers in certain occupations, we will decide
that in those communities there should be some training of Negroes,,
decide in what occupations and to what degree, so that now we will
begin training Negroes in more centers, for occupations in which
they may not now be employed.

Mr. OsMERS. Do you feel that the situation is improving?

Mr. Weaver. Yes. We have the machinery set up and we are
actually doing it in one or two areas.

Mr. OsMERS. Tell me how big a staff you have in the Negro em-
ployment and training branch?

Mr. Weaver. About six field men with one or two others.

Mr. OsMERS. How many other Negroes are employed in O. P. M. ?'

Mr. Weaver. Outside of my office I suppose there may be three or-
four stenographic workers, one or two clerks, and four or five mes-
sengers.

Mr. OsMERS. About a dozen you would say?

Mr. Weaver. I think that would be about accurate.

DISCRIMINATORY PRACTICES IN SOME STATE EMPLOYMENT SERVICES

Mr. OsMERS, Now, you have had, I presume, considerable experience
with the United States Employment Service. Have you found any
evidence, on their part, of discrimination against Negroes or against
any group?

Mr. Weaver. Well, it all depends on what you mean by the United
States Employment Service, sir. Of course, as you know, they op-
erate through the State offices.

Mr. OsMERS. That is what I am referring to.

Mr. Weaver. I have found the Employment Service very coopera-
tive. Obviously, in their various local and State offices you get all
degrees of cooperation ; it depends upon the locality of the office
and the person who is in charge of the office.

Mr. OsMERS. Would you care to cite for the record any specific
instances where they were discriminating or apparently discrimi-
anting against Negroes?

Mr. Wea\-er. The Employment Service is in a very peculiar posi-
tion. Overt and outward discrimination is difficult to put upon it
because it is a referring agency and the situation that perhaps is
the most unfortunate thing would be when an employer calls in and
says : "I want 25 workers."

The interviewer says : "Wliat do you want, colored or white
w^orkers?"

And immediately the man says : "White workers"' without thinking.
It is almost an instinctive thing. Just as I would say if I were on
the other side : "Colored workers."

You just do it. On the other hand there have been offices like in
New York City where it has received calls for white workers and

NATIONAL DEFENSE MIGRATION 6543

they have explained to the employer that it had qualified Negro
workers and has sold them on the service of those qualified workers,
but that is a rare thing.

Mr. OsMERS. Would you say that as a general thing the employ-
ment services could help a great deal if they wanted to?

Mr. Weaver. Yes; and 1 think in tliis new set-u]i that we have,
this new labor supply branch of O. P. M. in which the Employment
Service is represtened and in which our office is represented in these
new labor supply committees in the various areas, we are going to be
able to get the Employment Service to do more of this than they
have done in the past.

NUMBER or NEGROES PLACED IN CONSTRUCTION

Mr; OsMERS. Would you be able to estimate for the committee the
number of workers that have received positions in defense industries
as a result of the efforts of your branch?

Mr. Weaver. I could only do that in construction, sir. I think
that in construction by April, conservatively, we had placed over
2,500 Negro skilled workers and tens of thousands of common labor-
ers, many of whom would have been placed anyhow, but the skilled
workers, I think, we had a great deal to do with placing.

Other than that it is impossible to estimate, because after we get
an employer to accept Negro workers and after we get the machinery
in operation to refer them to him, there is no way that we can
check back on the number he employs.

Mr. Osmers. William Green testified before the committee yester-
day and he told us with considerable ])ride and I think he should
liave considerable pride in the fact that his union had cooperated
with the defense program in the instances which he had cited to
the committee, and they had sent as many, in one instance, as 23,000
skilled workers to a certain defense area. I would like to inc|uire if
you know the nimiber of Negroes that were involved in those huge
innnbers of men that were supplied to these defense programs.

Mr. Weaver. I don't know the answer but I am willing to say
that it was a very small number, if any. I don't know the facts
except as they are reflected in the employment on those particular
projects that we run into.

Mv. Osmers. Well, this committee as you know, is interested in
stopping needless migration wherever possible and the point that
we have made, in many of these communities, has been that they
should use the resources of their own area first before transferring
thousands of people from all over the country. I think the Balti-
more area is a crystal-clear example.

BARRING OF negro CARPENTERS AT PETERSBURG, VA.

Mr. Wea\'er. I can give you a specific one, in the construction
of the camp at Petersburg. I have forgotten the name of the camp
now, but there is this big camp down there at Petersburg. There
Mere hundreds of Negro carpenters in the area contiguous to Peters-
burg and in Petersburg. On the other hand as far north as New
York City, through the same mechanism which you speak of, white
carpenters were recruited and brought into the Petersburg area and
not a single Negro carpenter was permitted to work in the construc-
tion of that camp.

e039t>— 41— pt. 16 16

5544 WASHINGTON HEARINGS

Mr. OsMERS. Would you agree with me in this statement, that it is
rather ridiculous to spend these millions of dollars and go to the
extent that we are to defend the four freedoms throughout the world,
if we are not going to give those four freedoms to the people in our
own country.

Mr. Weaver. Yes, sir; very definitely. And I think it also is a
very dangerous procedure.

Mr. OsMERS. I told an aircraft executive, who came before the
committee and expressed the great fear that the production of air-
craft in his plant would stop if they employed Negi'oes, that I
thought it would be just as well if the production of aircraft did
stop if we were going to bar this one group of Americans from par-
ticipating in the program.

That is all I have, Mr. Chairman.

The Chairman. Congressman Arnold ?

Mr. Arnold. No questions.

The Chairman. Congressman Curtis?

RACIAL variations IN APTITUDE

Mr. Curtis. Mr. Weaver, do you think that the various aptitudes,
such as mechanical aptitude vary within races or nationalities?

Mr. Weaver. I think they vary with individuals.

Mr. Curtis. Do you think that Mexicans make just as good police-
men as Irishmen?

Mr. Weaver. It all depends on the Irishman and the Mexican.

Mr. Curtis. In other words it is your opinion that it is a matter of
training and individual adaptability?

Mr. Weaver. Yes, sir; and selection.

Mr. Curtis. Are there any figures on that?

Mr. Weaver. We had a lot of figures some time ago on intelligence
tests and then the testers of the intelligence tests got together and
disagreed on what they were testing. That is about the closest we
ever had anything, objectively, on that. We get aptitude tests which
are admittedly unsatisfactory but they are indicative of, perhaps, a
capacity.

I don't think that you have any objective data. You do have this
fact:

You can prove just about what you want to prove on those things,
I believe. I think I could prove that Negroes could do any job as
well as anybody else with the same data that somebody else would
use to disprove it. The nearest we have to objective data on effi-
ciency are those figures which come out of groups working at piece
rates on a productive basis and most of those figures seem to indicate
that these racial factors don't count, provided the same type of selec-
tion was used in the first place.

Mr. Curtis. You don't think that they could prove that, say for
instance, Swedish people were better mechanics than Greeks?

Mr. Weaver. I don't quite comprehend that concept, sir, because it
all depends upon what group of Swedish people you start with.
Now, obviously, if you go into a rural area, say into a plantation
area where cotton is being producfxl with a single process that has
been there for years and you take the worker who is doing that, be
he white or black, and you put him up to a machine, and then you go
into another area where there is diversified farming and where the

NATIONAL DEFENSE MIGRATION 5545

farmer has to be a good all-around mechanic and put that farmer next
to that southern plantation worker, be he white or black, and the
man from the diversified farming section is going to run circles all
around the other man, but I don't think that is a racial characteristic.

Mr. Curtis. You do not think that the Greeks' ability to excell in
running a restaurant is a racial characteristic ?

Mr. Wea\^r. No ; I think that is an environmental factor, the same
as the Chinese in the laundry business.

Mr. Curtis. And the Japanese as vegetable growers?

Mr. Weaver. Yes.

Mr. Curtis. That is all.

The Chairman. Thank you very much, Mr. Weaver. We appre-
ciate your coming here.

Our next witness is Governor Townsend.

STATEMENT OF M. CLIFFORD TOWNSEND, DIEECTOR, OFFICE OF
DEFENSE RELATIONS, DEPARTMENT OF AGRICULTURE, AND
MEMBER OF PLANT-SITE COMMITTEE, OFFICE OF PRODUCTION
MANAGEMENT, WASHINGTON, D. C.

The Chairman. Governor Townsend, Congressman Arnold will
interrogate you.

Mr. Arnold. Governor, you have given your name to the reporter.
In what capacity do you appear here?

Mr. Townsend. Dn-ector, Office of Defense Relations, Depart-
ment of Agriculture.

Mr. Arnold. And you are also a member of the Plant-Site Com-
mittee of the O. P. M.?

Mr. Townsend. Yes, sir.

Mr. Arnold. And your home is in Indiana ?

Mr. Townsend. Yes, sir; living here temporarily.

Mr. Arnold. Would you briefly outline the present work of the
Plant-Site Committee of the O. P. M. ?

Mr. Townsend. Do you mean just the character of the work that
is being engaged in at the present time?

Mr. Arnold. Yes. You have submitted a very fine statement to-
gether with charts that are very valuable and they will be included
in the record. They will constitute a very valuable contribution.

statement of M. CLIFFORD TOWNSEND, MEMBER OF PLANT-SITE
COMMITTEE, OFFICE OF PRODUCTION MANAGEMENT, WASHINGTON,
D. C.

The Location of Defense Plant Sites

A great many people have been concerned for some time with the effect of
the defense program upon the migration and future welfare of American
workers. At present we cannot estimate accurately how many hundreds of
thousands of workers will shift from one line of work to another or move
their homes from one comnumity to another as a result of the defense program,
because it is still impossible to predict the magnitude of the emergency that
will face the Nation this winter or next year. Recently, however, when I
visited my home State, Indiana, I was impressed by the extent of the effects
of the defense program on the American worker. Already many managers of
defense plants and many farmers in my State have found 'it difficult to recruit
qualified workers. This is true despite the fact that only a year ago our Gov-
ernment had to provide for from seven to ten million unemployed workers
"willing and able to work," while thousands migrated from State to State In

g546 WASHINGTON HEARINGS

search of jobs. In short, although the Nation has just begun its defense pro-
gram, it is already necessary for workers to move to new communities and
to acquire the skills of what may be temporary jobs.

As the sweeping implications of our defense program become evident it is
clear that comprehensive planning of the very highest order is necessary If our
defense production is to be carried on successfully without creating serious
problems for large groups of workers after the emergency is over. I would
like to devote my testimony before this committee primarily to the problem of
coordinating the planning of industrial an<l agricultural production under the
defense program so that the migration of workers and their dislocation from
peacetime jobs is reduced to a minimum. As a member of the Plant Site Board
of the Office of Production Management, and as Director of the Office of Agri-
cultural Defense Relations, I have an opportunity of participating in the plan-
ning of each of these two major aspects of the defense program.

Prom the very beginning of the defense program many individuals have
claimed that a proper geographical distribution of defense production would
do more to prevent wasteful human migration than any other single measure.
Now we are faced by the significant fact that only through a carefully planned
distribution of contracts and new plant facilities can we hope to maintain a
balanced production program. From the time I first participated in the de-
fense program it has been my opinion that unless the geographical distribution
of industrial production is carefully planned in relation to the problem of
increasing the production of est-eiitial food commodities, all kinds of serious
difficulties will be encountered. Without such planning one phase of the de-
fense program will compete with another for labor and materials in some
areas, while in other sections of the country large labor and raw material
reserves will remain unused. There is always the danger, in short, that we
will fail to secure the maximum increase in the production of the tools of
war or the desired increase in the production of food commodities. We would
run the risk of break-downs in our industrial production or a curtailment in
the supply of certain food commodities.

FOUR PRINCIPLKS IX DISTRIBUTING PT.ANTS

In planning the geographical distribution of new defense plants, defense
officials have been guided by four major principles:

First. New defense plants should be located so as to enable us to make the
greatest and most expeditious use of the manpower, machinery, and materials
of the Nation. In short, the defense program must be so distributed that we
can draw promptly and to the fullest extent on the available manpower and
facilities of the country. To accomplish that, plants must not be located at
sites where shortages of labor, housing, essential materials, and transporta-
tion facilities, or other "bottlenecks" will be encountered. Furthermore, plants
should not be located at sites where such an additional factory will create
new "bottlenecks" for operators already established in the area.

Second. It has been the policy to distribute operations so that when we are
through building armaments our Nation will have as soundly organized an
industrial system as possible. If this objective is to be achieved it is neces-
sary to avoid drawing into a few temporary boom areas thousands of work-
men who will be left stranded after the emergency is over. A more difficult
task is to work toward a better balance between industry and agriculture in
many States.

Third. The manufacture of defense requirements should be distributed so as^
to make the maximum possible contribution to the welfare of American work-
ers— both urban and rural. Such an objective calls for locating defense plants
in areas where large bodies of unemployed and underemployed workers have
been dammed up in temporarily depressed communities or on poor land.
World War No. 1 demonstrated that to use effectively such labor and to lay the
basis for a permanent improvement in the standard of living of such people,
insofar as possible, industry must be brought to the workers rather than the
workers to a distant factory.

Fourth. The fourth objective of the Plant Site Board of the Office of Pro-
diiction Management has been to avoid as far as possible the location of any
plants in areas producing essential defense food commodities where there was
a prospect of a serious rural labor shortage. A study was made of the areas
in which the production of dairy and poultry products and vegetables and
fruits was concentrated and on the advice of Vice President Wallace, Secretary-

NATIONAL DEFENSE MIGRATION

6547

Wickard, and Surplus Marketing Administrator Milo Perkins, tliese areas were
avoided by the committee, insofar as it was possible. Again, however, I think
it should be pointed out that frequently this rule had to be overlooked when-
ever technological or strategic considerations restricted the choice of sites for a
defense plant.

It has not been, easy to carry these principles into effect. Some of you, no
doubt, are of the opinion that we have been better in principle than in prac-
tice. The opinions of many of you have been formed on the basis of data
regarding the distribution of all defense contract awards. Table I shows the
distribution by States and by industrial areas of all types of major defense
contracts between June 1, 1940, and May 31, 1941, except some of the contracts
awarded by the Defense Plant Corporation and the Maritime Commission.

Table I. — DistriJ)ution of major defense prime contracts awarded hy the War
and Navy Departments, by State and major object, June 1, 1940, to May 31,

1941

[Thousands of dollars]

Total

Percent of
United
States
total

Airplanes,

engines,

parts, and

equipment

Ship con-
struction
and equip-
ment

AU other

Grand total

$11,955,995

100.00

$2, 523, 247

$3, 687, 281

$5, 745, 467

11, 243, 128

94.04

2,489,263

3, 639, 186

5,114,679

168, 704

3.107

4,940

1,334,502

123, 707

558, 146

6,365

5,623

96,202

85, 420

1,251

333.078

376, 240

68, 761

63,612

48,477

34,387

185.476

358,651

690. 686

723,908

43,449

71, 579

359, 823

14, 265

4,249

12, 748

1,388,764

9.362

1, 100, 529

85,636

1.41
.03
.04
11.16
1.03
4.67
.05
.05
.80
.71
.01
2.79
3.15
.58
.53
.41
.29
1.55
3.00
5.78
6.05
.36
.60
3.01

40, 172

128, 532
3,107

461,455

128,095

4,295

197

46, 309

5,276

4 924

California - -

664, 126

208, 921

Colorado

123, 668

215, 233

214,818

2,070

Di'5trir>t of Cnldmhia

5 426

Florida

49. 893

Georgia

80, 125

Idaho

1 251

Illinois . --

40,003

120,695

43,441

117

24,414

268, 661

Indiana

251 642

68, 682

Kansas

20, 171

Kentucky

278

4,011

174.624

6,847

528,488

26, 150

439

60,014

1,301

48. 082
30. 376

Maine

10, 852

234. 587

4,654

220, 727

705

117,217

Massachusetts

157, 544

Michigan

Minnesota

Mississippi

477, 031
42. 305
21, 565

67,452

291, 070

Montana

Nebraska ..

.12
.04
.11
11.61
.OH
9.20
.72

14, 252

Nevada

4,249

153
313,063

18
820, 149

12, 577

255, 552

New Mexico

9.362

New York

344, 250

149, 704
793

606. 575

84, 843

North Dakota

Ohio

475, 504
22, 626
51.014

654, 251
61, 938

75, 760

266, 580

9.924

3,. '540

545. 749

424, 409

95, 017

14, , 891

4,293

3.98
.19
.43

5.47
.52
.41

18, 133

1,860

19,. 172
76
47

125, 576

362

36,244

191,510

8', 342

331, 795

Oklahoma -

20, 404

Oregon

14, 759

Pennsylvania

Rhode Island

443, 569
56, 494

South Carolina

40, 456

128

Tennessee

.63
2.23

.08

.03
4.56
3. .55

.79
1.19

.04

57
37, 742

1.424

101,871

74, 279

Texas

126, 967

Utah

9,859

:::::::::

3,540

Virginia

389, 801

239,412

1,649

60,524

155, 948

135, 810

7,015

49, 187

West Virginia

93, 294

Wisconsin

74, 352

Wyoming

4,293

Off continent

623', 593

.75
5.21

1,034
47, 061

88,240

Unassignable

33, 984

542, 548

6548

WASHINGTON HEARINGS

These are aggregate figures for all types of defense operations. They in-
clude new plants built by the Federal Government as well as contracts placed
with private manufacturers in existing plants. It is true that there appears
to be considerable concentration of defense production but it must be recalled
that before the emergency began, manufacturing was already highly concen-
trated in these same States. In 1939 the census showed that 10 States, New
York, Penn.sylvania, Illinois, Ohio, Michigan, New Jersey, Massachusetts, Cali-
fornia, Indiana, and Connecticut, accounted for about 71 percent of all the
value added by manufacturers in the counti'y as a whole (see table II). It is
interesting to note that the 10 States with the highest percentage of defense
contracts had very nearly the same percentage of the total (72 percent). Fur-
thermore, 8 of the 10 States having the largest share of defense contracts
were in the list of rhe 10 States having the largest share of the Nation's
industry. In other words, defense contracts had to be given to plants where
they were located.

Before proceeding further, however, I think that it is wise to break down
this data further and examine table III and map I (prepared by the Indus-
trial Location Section, National Resources Planning Board), showing the dis-
tribution of all new plant facilities financed in one way or another under the
defense program. Naturally, one would expect a wider range of choice in
selecting locations for brand new facilities than in placing orders with existing
firms. New plants can be placed wherever raw materials, labor supply, terrain,
])Ower and transportation facilities, and points of use are satisfactorily related
to one another. The data regarding the distribution of all new defense plants
between June 1, 1940, and May 15, 1941, show that there has been a con-
siderably wider distribution of new facilities than of contracts to existing
plants. No State has been assigned more than 8.9 percent of the total capital
invested in these new facilities, which is considerably less than the share of all
manufacturing activity (13.5 percent) possessed by New York State. Further-
more many States not included in the 10 most industralized States, such as
Alabama, Missouri, Tennessee, Texas, Virginia, Washington, and West Virginia,
have been given a large number of new defense plants.

Table II. — Percentage distribution of total value added hij manufacture and
major defense contracts among the States

Value added by

manufacture

1939

Percent of

United States

total

Percent distri-
bution major
defense con-
tracts June

1940-May 1941

Continental United States

$24, 710, 565, 000

100. 00

100.00

Alabama

247, 384, 000

32,041,000

67, 390. 000

1,13.5,158,000

91,256.000

692, 187, 000

55, 183, 000

44,317,000

118,016,000

283, 616, 000

31,770,000

2,201,595,000

970, 212, 000

244, 795, 000

118,952,000

187, 400. 000

200, 086, 000

152, 423, 000

422, 849, 000

1, 188, 319, 000

1, 798, 404, 000

310, 628, 000

73, 462, 000

587, 962, 000

39, 790, 000

69, 087, 000

11,758,000

105, 188, 000

1,524,114,000

8, 712, 000

3,341,895,000

545, 952, 000

11,102,000

1.00

!27
4.59
.37
2.80
.22
.18
.48
1.15
.13
8.91
3.93
.99
.48
.76
.81
.62
1.71
4.81

1126
.30

;i6

.28
.05
.43

6.17

.04

13.52

2.21
.04

1.50

Arizona

.04

California

11.87

Colorado

1. 10

4.96

Delaware

.05

District of Columbia

.05

Florida .

.85

Georgia

.75

Idaho '

.01

Illinois ..

2.97

3.35

Iowa...

.62

Kansas .... .

.56

Kentucky. .

.44

Louisiana

.31

Maine . .

1.65

Maryland .

3.19

Massachusetts

6.15

Michigan .... ..

6.43

.38

Mississippi.

.64

Missouri ..

3.20

Montana .

Nebraska

.13

Nevada..-. '

.04

New Hampshire-

.12

New Jersey.... .

12.34

New Mexico. .

.09

New York

9.78

North Carolina

.77

North Dakota. .

NATIONAL DEFENSE MIGRATION

6549

Table II. — Percentage distribution of total value added by manufacture and
major defense contracts among the States — Continued

Value added by

manufacture

1939

Percent of

United States

total

Percent distri-
bution major
defense con-
tracts June
1940-May 1941

Continental United States— Continued.

Ohio --

$2,125,474,000
103,118,000
172, 175, 000
2, 489, 129, 000
238, 289, 000
169, 847, 000

19, 955, 000
320, 342, 000
453, 105, 000

43, 720, 000

51,941,000
379, 488, 000
286, 647, 000
214, 779. 000
686. 605, 000

15, 629, 000

8.60
.42
.70

10.07
.96

!08
1.30
1.83

.18

.21
1.54
1.16

.87
2.78

.06

4.23

Oklahoma

.20

.46

5.82

Rhode Island

.55

.44

Tennessee

.67

2.37

Utah

.09

Vermont

.03

4.85

3.77

West Virginia

.84

1.27

Wyoming

.04

Table III. — Geographic distribution of expansion of manufacturing facilities for
defense, as of May 15, 19Jfl

State

Arkansas

California.

Colorado

Connecticut

Delaware-

District of Columbia

Florida

Gforgia

Illinois

Indiana.-

Iowa -.

Kansas-- -

Kentucky

Louisiana

Maine.. .-. --.

Maryland

Massachusetts

Michigan

Minnesota ..-

New York -

North Carolina

Ohio

Mississippi

Missouri

Montana

Nebraska-

Nevada

New Hamp.shire

New Jersey

New Mexico

Oklahoma

Pennsylvania

Rhode Island

South Carolina

Tennessee

Texas

Utah---

Vermont-

Virginia

Washington

West Virginia

Wisconsin

Break -down by location not
available ._-

United States-

Percent

of United

States

total

$124,

163,

28,
122
3
8,
2

177,
224

8.";.:
218, S

, 134, 223

4.2

.004
5.5
1.0
4.1

3.2
.2
.1
3.9
2.2
3.0
.7

Privately
operated

ment
operated

Privately
financed

British
financed

OMITTED AS CONFIDENTIAL

g550 WASHINGTON HEARINGS

Even these figures, however, are somewhat misleading. Prior to April 1941,
plant site proposals made by the Army were approved by the National Defense
Advisory Commission. During this period speed was the essential consideration,
and plants were located at those sites where production could be gotten under
way the most rapidly. Map II and graph I show the State and regional distri-
bution of the projects approved by the Defense Commission. In April, at which
time I first became involved in this work, a special Plant Site Board was
organized within the Office of Production Management for the specific purpose
of encouraging a wider distribution of new defense facilities. As a result of its
efforts and the fact that the Army had turned its attention to locating plants
in the West and Southwest, the Plant Site Board has been able to secure the
location of a larger share of new plants in the Great Plains States and the
Southwest than did the National Defense Advisory Commission. Map III and
graph II shows that during the first few months that the Plant Site Board has
functioned there has been marked relative increase in the number of plants
located in the West North Central, West South Central, and the East South
Central regions, and a decline in the number of plants awarded to the East
North Central, Middle Atlantic, and New England regions.

Although the record of the Plant Site Board is good, I am not entirely pleased
with its work. It is regrettable that more defense facilities have not been
located in areas in the Old South that have suffered so heavily from the loss
of tobacco and cotton export markets. I do feel, however, that a conscientious
effort has been made to examine the possibilities of locating industry in areas
where labor is immediately available. In this way we have taken a very
constructive step toward reducing to a minimum the amount of migration of
labor resulting from the defense program.

NATIONAL DEFENSE MIGRATION

6551

6552

WASHINGTON HEARINGS

NATIONAL DEFENSE MIGRATION

6553

6554

WASHINGTON HEARINGS

REGIONAL DISTRIBUTION OF FEDERAL EXPENDITURES FOR DEFENSE INDUSTRIAL
FACILITIES APPROVED BY NATIONAL DEFENSE ADVISORY COMMISSION

AUGUST, 1940 - APRIL, 1941
et CENSUS DISTRICTS

EACH COIN REPRESENTS $5,000,000.

FIGURES INDICATE VALUE OF CONTRACTS IN MILLIONS.

TOTAL VALUE OF CONTRACTS- <l,06e.9

NATIONAL DEFENSE MIGRATION

6555

REGIONAL ALLOCATION OF PLANT SITE BOARD APPROVALS

APRIL 30, 1941 THROUGH JUNE 30, 1941
BY CENSUS DISTRICTS

FIGURES INDICATE VALUE OF APPROVALS IN MILLIONS

TOTAL VALUE OF APPROVALS - $ 1,047.5

AMOUNT DISTRIBUTED BY REGIONS -$ 1,030.5

NOT ALLOCABLE- $ 17.0

6556

WASHINGTON HEARINGS

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NATIONAL DEFENSE MIGRATION

6557

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6558

WASHINGTON HEARINGS

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NATIONAL DEFENSE MIGRATION

6559

60396 — 41 — pt. 16 17

g560 WASHINGTON HEARINGS

INFLEXIBI.E DISTRIBUTION IN a-:R'rAIN INDUSTRIES

Our success in encouraging the wide distribution of new defense facilities
has been restricted in a large measure to those plants producing ammunition
and ammunition components. Table IV shows, however, that in expanding many
other highly important defense industries there has been very little decentrali-
zation. The expansion of iron and steel facilities or of plants producing arma-
ment requiring considerable iron and steel, or even factories turning out air-
craft or new naval units, must be located in the few highly restricted areas.
It would be possible to take any one industry and discuss with you the tech-
nical limitations which have made it impossible to locate plants outside a few
restricted areas, but I shall impose on your time only long enough to cite a
few examples. Increased facilities for ship construction can be erected so
much more rapidly at existing shipyards that new ways are being built almost
entirely adjacent to them. In the case of the aircraft industry, quite a dif-
ferent situation exists. Experienced managers and technicians, in this case, are
so scarce that in a great many instances expansion was feasible only at parent
plants.

The fact remains that a great deal of the industrial expansion under the
national-defense program will have to take place within the great industrial
areas of the East and Middle West, whether we like to see that happen or
not. It is the only way we can secure the increase in production we need so
urgently.

It is clear, therefore, that a great many people will be drawn into rela-
tively few defense boom areas located primarily in the Northeastern section
of the country. In addition, many workers in these defense areas will find
it profitable and necessary to shift occupations. This will be true of many
skilled year-around farm workers who will find jobs in local factories. This
drift of farm hands into industry in the Northeast presents the Nation with
many serious problems. Our national-defense program requires that those
workers be replaced. In concluding my remarks, therefore, I would like to
discuss the extent of present farm-labor shortages and describe the measures
that can be taken to recruit additional workers.

DRAIN OF WORKERS FROM THE FARM

Thus far there has been no shortage of farm labor for the Nation as a
whole. According to the July 1 report of the Agricultural Marketing Service,
however, the supply of farm workers was only 67 percent of normal and 71
percent of demand. This report states that "this was the smallest supply re-
ported during the 19 years covered by the July record and lower than previ-
ously reported for any month since 1918, when this series was first inaugu-
rated." On July 1, 1940, the supply was 88 percent of normal and 102 percent
of demand. According to this report, the major reasoris given by farmers for
this decrease are rapid increases in defense activity, wide differentials between
industrial wage rates and the rates which the agricultural price level will
permit farmers to pay, and the drafting of able-bodied men for our armed forces.

July 1 employment figures for the Nation show 268,000 fewer workers on
farms than a year ago. To meet the impact of the drain of workers from
the farm, however, farmers are obliged to employ older men, schoolboys, and
women. The decline in employment, then, reflects only a part of the total loss
of efficient workers on farms.

Nonagricultural employment and men in military service, according to the
latest information, increased by 4.3 millions between May 1940 and May 1941.
Agriculture has not only sacrificed thousands of its more skilled workers, but in
addition, there were 182,000 fewer persons employed on farms for the same
period.

Since May, agriculture has reached its peak in this year's seasonal demand
for labor, and 1,010,000 additional workers have been employed. Approximately
one-third of these came from the farmers' family and two-< birds were hired.
The increase in agricultural employment was met in part by the payment of
the highest wage rates paid on farms since 1930. The index of farm wage rates
now stands at 160 percent of the 1910-14 average, as compared with 129 percent
a year ago.

The severity of the problem appears less important when figures for the
Nation are studied, than when the problem is observed within geographic
divisions and particular farming areas. It will be observed (table V) that
in May 1941, only one geographic division, the Mountain States, showed an

NATIONAL DEFENSE MIGRATION

6561

increase in employment. This occurred in the area least affected by increases
in nonagricultural employment. Decreases in agricultural employment in the
New England, Middle Atlantic, and the East North Central States are par-
ticularly associated with increases in nonagricultural employment. In the
Southern States this factor was of lesser importance, with the possible excep-
tion of parts of the South Atlantic States.

Between July 1940, and July 1941, three geographic divisions showed increased
agricultural employment. Farming activities now are at their peak in the
New England, Middle Atlantic, and East North Central States. In New Eng-
land, an increase of 14,000 farm workers was reported over the previous year.
Eight thousand of these were added from the farmers' own families and
6,000 represented hired labor increases. Contributing to this increase was the
employment of school boys and men above the draft age, and the payment
of wages between $63 and $79 per month and between $2.85 and $3.55 per day
(without board in each case).

Table V. — Changes in number of persons employed in agricultural and non^
agricultural pursuits, 1940-41

Nonagricul-
tural—
May 1940
to May
1941 1

Agricultural

Geographic division

May 1940

to May

1941

July 1940

to July

1941

New England

1,000
-f422
-1-689
-1-933
-1-175
-i-486
-fl36
-flSO
-1-42
-f256

1,000

-14
-25
-12
-66
-56
-35
-f36
-5

1,000
+14

Middle Atlantic

— 17

-fi

West North Central

+53

South Atlantic

—187

-100

West South Central

-26

Mountain

—6

Total

4-3, 115

-182

—268

• Excludes an increase of 1,198,000 in the military and naval forces.

Source: Bureau of Labor Statistics, U. S. Department of Labor, and Agricultural Marketing Service,
U. S. Department of Agriculture.

In West North Central States nonagricultural employment is not so important,
and an increase of 53,0'30 workers occurred over last year. The Pacific Coast
States has been able to call upon their reserve labor force, and an increase of
7,000 occurred over last year.

Decreases in employment are particularly noticeable in the Southern, Middle
Atlantic, and East North Central States. In the South, the decrease in acres
devoted to cotton, the drought and layiug-by of the crops are more important
factors. In the Middle Atlantic States and the East North Central States,
however, the situation is now in its more critical stages. Labor requirements
are now at their peak in these areas of intense industrial activities. Moreover,
these two areas are imiwrtant producers of vital agricultural defense com-
modities in which production increases are absolutely necessary.

FAKM AREAS AFFECTED BY L-UJOR WITHDRAWALS

The Bureau of Agricultural Economics reports that large numbers of the
more skilled and reliable regular farm workers have been lost to industry and
the military forces. Every major agricultural area has been so affected. As
a result, farmers have been forced to employ less efficient men and usually at
higher wage rates. The areas most adversely affected in this respect are areas
surrounding industrial centers and Army cantonments and the dairy, poultry,
vegetable and canning sections of the East North Central, Middle Atlantic, and
New England States.

Shortages of workers expected earlier this year have been met in part by an
increase in the number of family workers and in part by a decline in production
of certain crops due to weather conditions. It had been anticipated that critical
shortages of workers would occur in some areas. One of these areas was the

6562 WASHINGTON HEAKINGS

Atlantic seaboard truck farming area. This expectation was based upon the
heavy drain of workers to defense employment and to employment indirectly
stimulated by the defense program, plus the unknown effect of these factors upon
the usual flow of migrant workers. The flow of migrant workers was reduced
and it is now believed that the anticipated shortage would have occurred
except for the drought conditions which affected most of this area. Another
area in which shortages were expected was the dairy and poultry areas of the
North Central, New England, and Middle Atlantic States. In the North Central
States production was maintained in spite of a reduction of 52,000 farm workers
in June 1941, compared with June 1U40, and a 6,000 reduction between July
1940, and July 1941. Employment in the New England,' Middle Atlantic," and
South Atlantic' States totaled 58,000 less on June 1, 1941, than a year earlier,
and 9,000 less between the July 1940, and July 1941 period.

Adequate supplies of farm labor appear to exist in the Southern Appalachians
of Virginia, West Virginia, Kentucky, North Carolina, and Tenneseee, and in the
cotton and tobacco areas of the Southeastern States. A surplus appears to exist
in Montana and Wyoming and in the upper Great Lakes States. No immediate
shortages are apparent in the Great Plains States except in parts of Kansas
and certain localized areas and for farm help with mechanical ability.

During the coming months, and in particular during 1942, agriculture will ex-
perience increasing difficulties in securing adequate labor unless proper measures
are taken because non-agricultural employment will continue to increase. First
of all, farmers will find it necessary to rely upon le.ss experienced and less quali-
fied workers. Higher wage rates are now being paid in all localities than in re-
cent years. Farmers may find it necessary fo pay increasingly higher rates of
pay to more nearly compete with industry. Family workers will contribute a
larger proportion of the total working force to ofl'set, in part, the total wage
expense and, in part, because less qualified help is now available. The flow of
habitual migratory farm works will undoubtedly decline. This factor, alone,
will be sufficient to make the problem acute at seasonal operations. The exist-
ing shortage of dependable regular hired men will become so acute that farmers
may be prone to curtail or eliminate certain operations to avoid losses due to
labor shortages or inefficiencies. The short-cutting of farm practices at high
wage rates may become profitable to individual farmers, but it should be dis-
couraged if it will affect production of vital commodities. If a farmer should
be faced with this problem, he should give preference to those crops designated
as vital to the defense program. Curtailing of operations should be limited to
less essential crops.

IMPENDING SHORTAGES OF FARM LABOR

In spite of increased wages, serious shortages of farm labor will develop in
many sections of the country during the next 2 years. These shortages will
develop in areas where we cannot tolerate decreases in production because of
the necessity of maintaining the Nation's output of certain vital food commo-
dities. Constructive steps must be taken soon, therefore, to meet these shortages.
Thus far we have limited our effort to securing temporary deferment for young
selectees who are needed on the farm, and to increasing the effectiveness of the
farm placement .service in recruiting workers. These efforts have by no means
solved the problem, and additional steps must be taken soon.

We have all been aware of the growing farm labor problem and its probable
effect upon agriculture's part in the defense program. Considerable efforts are
continually being made by the various agencies concerned to assist with the
problem. Unfortunately we cannot look to increased use of machinery for solu-
tion of much of the problem. Particularly is this true in the production of
such vital commodities as fruits, vegetables, poultry, and eggs. Moreover, it now
appears that production of farm machinery will be curtailed. The problem
tends now to become one of securing an adeauate supply of manpower of suffi-
cient experience.

Many feel that workers should be required to leave the Work Projects Admin-
istration and accept jobs on farms. This is practicable to a very small percent. I

^ Includes Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, and Connec-
ticut.

2 Includes New York, New Jersey, and Pennsylvania.

• Includes Delaware, Maryland, Virginia, West Virginia, North Carolina, South Carolina,
Georgia, and Florida.

NATIONAL DEFENSE MIGRATION ^563

am iucliued personally to believe that alleviation of the problem from this source
has been greatly overemphasized. Nevertheless, no stones should be left un-
turned and efforts should be continued to transfer systematically as many of
these people as possible to private employment. It seems to me that farmers must
look forvrard to finding workers in the more youthful and the older age groups.
Many such individuals, however, are untrained for agricultural work and prove
to be a liability to the farmer in many cases. It is becoming clear, therefore,
that the Federal Government must shortly undertake some program aimed at
training workers for specialized farm jobs. In addition, farmers can solve
many of their own problems through exchanges in the use of the available
labor force within their communities. Almost constant contact can be main-
tained between farmers within communities. Community committee represent-
atives in hundreds of counties included in the land use planning program will
render valuable service by maintaining ties between communities.

The loss of excellent farm workers and the recruiting and training of new
workers for farm work will cause serious postemergency employment prob-
lems. It is quite likely that after the present emergency is over we will once
again be faced with a back-to-land movement, and large surpluses of migrant
farm workers. Nevertheless our course is clear. We must not hesitate to
mobilize the resources of the Nation in meeting the present emergency. At
the same time, however, a new effort should be made to plan systematically to
meet complex and difficult postemergency problems.

TESTIMONY OF M. CLIFFORD TOWNSEND— Eesumed

Mr. Arnold. In addition to your statement, I would like to ask
some questions and one of them is what the present work of the
Plant Site Committee of the Office of Production Manajijement is.

Mr. TowNSEND. Well, it is the duty of the Plant Site Committee
to accept or reject the sites that are presented to them by the various
defense bodies — the Army, the Navy, the Air Corps. Its work seems
to be pretty well completed at the present time.

There is pending now what is known as one unit of a powder
plant — bag-loading and shell-loading plant. Then week by week
there comes before that Board additions and expansions to both
privately owned and Government owned plants. All plant sites
come before the Board whether they are for Government or private
plants, in which the Government is investing money or loaning
money.

Mr. Arnold. Then the Plant Site Committee exercises absolute
veto powers over plant sites?

Mr. TowNSEND. Yes, sir ; that is their power. They do not initiate
sites. I want to make that plain. They do not initiate sites. They
are simply an approving board. The Plant Site Committee, of
course, has to have some standard or program to which they turn
when they review these sites.

They are interested, as I understand you are interested, in workers
and the welfare of the workers — not only the welfare of the workers
at this time but the welfare of the workers after this defense effort
has been concluded.

Mr. Arnold. And you are connected with it to the extent of exer-
cising the veto power?

Mr. TowNSEN. Ye^.

Mr. Arnold. Who makes the actual choice of sites — the Army and
the Navy and Air Corps ?

Mr. TowNSEND. That is right. And in the case of an individual
who is establishing a defense industry, he selects it.

g564 WASHINGTON HEARINGS

Mr. Arnold. But the Plant Site Committee approves his selec-
tion?

Mr. TowNSEND. That is right. Private manufacturers make their
requests and furnish our board with the reasons why their choices
should be approved.

DECENTRALIZATION OF NEW PLANT FOR DEFENSE

Mr. Arnold. Has the Plant Site Committee accelerated the rate
of decentralization of new plant expansion since its appointment?

Mr. TowNSEND. Yes; I think we have very, very materially. I
am submitting here for your study some charts showing the location
of plants in the point of dollars approved by the Defense Commis-
sion prior to the organization of the Plant Site Committtee.' The
majority of these plants are in Northeastern States.

The Plant Site Committee came into being in April. Before that
they went to the Defense Commission for approval. Since the
Plant Site Committee has come into being, you will see by the second
chart that defense activity is much better distributed, geographically,
and has moved to the West and the Southwest and Northwest a
great deal more than it had before. I think it is well for you to see
the picture.

The first contracts let for this effort were let to those industries
already established, and 71 percent of all the industries in the United
States, from the point of view of value, were located in 10 States
and those 10 States received 72 percent of the contracts, which was
practically in proportion to the money invested in the industries.

The Defense Council and the Army and Navy were confronted
with the element of time, and it has since been proven that time was
the crucial consideration. It appears that most of the new industries
that were established then were established close to larger centers of
unemployed, managerial ability, and tools.

The Plant Site Committee has been fortunate in being allowed to
deliberate a little more carefully — time may not have been quite
such an element — and they have deliberated carefully and have had
the cooperation of the Army and Navy, I must admit, in giving more
thought to the economics of the country after the present defense
effort. So, it has been a little easier for the Plant Site Committee to
distribute these plans in, I believe, a better way.

Mr. Curtis. Would you yield to me for one question ?

Mr. Arnold. Go ahead.

PROCEDURE FOR COMMUNITY SEEKING PLANT

Mr. Curtis. Mr. Townsend, assuming that there is a certain type
of community that is needed for the location of some sort of defense
effort, and one of these communities is able to offer evidence that
they can take care of the situation — that they can provide decent
housing facilities, say for 4,000 people, and that those houses are so
located in their area that the children of those homes can be taken
care of in existing school facilities — to whom should that data go?
To your Plant Site Committee or to the Army and Navy officials?
Do they pay any attention to such matters, or are they just charged
with the pure militaiy technicalities of it?

See pp. 6554 and 6555.

NATIONAL DEFENSE MIGRATION g565

Mr. TowNSEND. Well, of course, their first obligation would natu-
rally be to consider the physical features — the proximity to the place
where the product is needed, the availability of materials, transporta-
tion, and labor. I wouldn't want to say that they don't think about
the other, but they are probably not quite so obligated to think about
the welfare end of it. The Plant Site Board does go into the other
side very thoroughly and I think if data were to be submitted by
such a connnittee it should be submitted both to the Army and Navy
and to the Plant Site Board.

^Ir. CuRiis. Thank you.

Mr. Arnold. Could jou tell the committee how many requests for
approval of sites b}' the Army and Navy and Air Corps have been
rejected by the Plant Site Committee after their deliberations?
Could you give us an approximate number of requests that have been
rejected?

Mr. TowNSEND. Ver}^ few. I couldn't give you the number; no,
sir; but very few.

CXX)PERATI0N \VITH ARMY AND NAVY

Mr. Arnold. Well, is there satisfactory cooperation between those
branches ?

Mr. Townsend. There is pretty good cooperation. That is prob-
ably the reason that there are so few rejections. They come in with
their preliminary studies and let the Plant Site Board study them
somewhat, and li some reason why that site ought not be approved
is presented, they begin to think of some other place. That is why
there haven't been many rejections.

Mr. Arnold. Your paper indicates that decentralization has been
achieved in new ammunition plants. Why is it that decentraliza-
tion could be achieved in that industry and not in other new plants ?

Mr. Townsend. Well, I believe to give you an exam])le would be
easier.

RAW MATERIAL FACTOR IN PLANT LOCATION

The location of a bomber engine plant at Ypsilanti, Mich., w^as not
a good location from the standpoint of distributing its products to
the aircraft industry, but the engines of the United States are gen-
erally made at the meeting point of steel and coal, and that was a
natural meeting point.

This company appeared to be the only one that was in a position
to take this large contract — this unusually big obligation — and they
>^aid, and I think rightly, that they were limited in their mechanically
trained supervisors and executives to the point that they couldn't
take this obligation unless the new plant were located near their pres-
ent plants. Of course, too, I think the Army thought that by slowing
up the business of making automobiles there would probably be a suf-
ficient number of laborers available there to be transferred into the
new plant, so it was doubtful whether it would have been wise to have
located that plant at any other place.

The Boarcl would liked to have put that into some other part of
the country where probabl.y there was more available labor, but it
didn't seeiii practical to do it. There are limiting factors. Your
powder plans just must go — especially smokeless-powder plants —

g566 WASHINGTON HEARINGS

where there is great volume of water. It takes almost an unbeliev-
able amount of water to make smokeless powder.

One of the engineers told us that if all the smokeless-powder
plants being constructed in the United States were put at one spot
on the Mississippi Kiver there would not be enough water to operate
rhem.

Mr. Arnold. Of course, it is evident why shipyards and steel
plants, and so forth

TRANSPORTATION, LABOR SUPPLY AS FACTORS

Mr. TowNSEND. Shipyards must be where there is water and most
shipyards are expanding their present facilities.

Mr. Arnold. Because it is easier and quicker and cheaper to con-
struct new ways within a yard than it is to start a new yard?

Mr. TowNSEND. That is right. Of course, personally, I have been
interested in the relation of rural and urban labor. My obligation is
largely agricultural and I have had fine cooperation in trying to
keep from putting these plants into that portion of the United
States where specially trained farm labor is needed at a time when
we are asking for an increase in agricultural production.

That is especially true in dairy and pork- and egg-producing re-
gions. We have not been able to do the job as well as we would
like, but that has been considered.

We find now that shortages in farm labor are beginning to de-
velop, especially in those areas.

Mr. Arnold. Was the Plant Site Committee consulted in the lo-
cation of the new steel plants or the new aluminum plants to be
built?

Mr. TowNSEND. Yes, sir.

Mr. Arnold. In both cases?

Mr. TowNSEND. Yes, sir; the deciding factor in both cases — and
the whole reason in aluminum plants — is electric power.

Mr. Arnold. And you are consulted with respect to all plants
where the Government contributes toward the building of them ?

Mr. TowNSEND, Yes,

Mr, Arnold, This morning Mr, Gill stated that unemployment
during the fiscal year 1942 will probably average 5i/^ millions. He
said the W. P. A, would be able to take care of only 1,000,000.
What is the Plant Site Committee doing to facilitate the reemploy-
ment of the remaining 4I/2 million — I mean by the distribution of
plants ?

Mr. TowNSEND. Well, a lot of this unemployment is in some of
the Southern and Southwestern States and some plants are being
put in there. The Plant Site Board is trying to encourage that
and I think the Army is trying to place as many in those areas as
it can.

They have had housing problems when they get into those areas,
especially with a plant that employs 6,000 or 8.000 people. Under
those conditions youi have to develop schools and housing and sanita-
tion and water and all the other utilities.

They are of the opinion that, even with good roads^ about 20
miles is as far as workers should commute, and that is especially

NATIONAL DEFENSE MIGRATION g567

true when you oet into lar^e plants. Road congestion occurs and
it takes the employees away from their homes for a good long
time, so they figure 20 miles is the limit. Some plants, however, are
being located in those areas.

Mr. Arnold. Of course, in mined-out areas you have the labor
and the housing already there for a good number of people?

Mr. TowNSEND. Yes; more so in a mining region than you would
find in a marginal farming region.

MALDISTRIBUTIOX OF FARM LABOR

Mr. Arnold. This next question has to do with the agricultural
situation. Your figures don't agree with those of Mr. Gill and
Chester Davis. Chester Davis, testifying before this committee last
December, stated there were 5,000,000 workers in rural areas in 1940
who were imemployed or underemployed in August, and who thus
constituted a farm-labor surplus. That was last December. You
state in your paper that there may be a serious farm-labor shortage in
some sections of the country. In view of Mr. Davis' estimate how
do you account for tliis ?

Mr. TowNSEND. I would readily agree with Mr. Davis that there
is no shortage in farm labor if you had the labor where the work is.
The shortage is developing in the dairy sections and in the Corn Belt
largely, and the surplus of farm labor is in the Southern and South-
western States. Then, of course, Mr. Davis included poorly employed
or, as he called them, underemployed, in his figures, with which I agree.
That is all right; they are employed but very poorly employed. It
should be noted, furthermore, that the great majority of the 5,000,000
are underemployed, rather than unemployed. Now it is quite dif-
ficult to pull certain groups of underemployed rural families into
industry.

There has been an increase in defense employment by more than
3,000,000 but agricultural employment is down now to about 265,000
less people employed in agriculture than there were a year ago.

Mr. OsMERS. Is that due to govermnental restrictions on agri-
culture?

Mr. TowNSEND. No.

Mr. OsMERS. Curtailment of crops and because of mechanization?

Mr. TowNSEND. No. That is due to the boys going to the Army
and going into defense industries where the wage differential at-
tracts them.

Mr. OsMERS. You use the figure "265,000." Wliat is the total figure
in agriculture?

Mr. TowNSEND. It is something in excess of 11,500,000, according
to the July estimate.

APPRAISAL OF WORK OF PLANT SITE COMMITTEE

Mr. OsMERS. Do you consider that the work of the Plant Site Com-
mittee, Governor, has been a success?

Mr. TowNSEND. Yes; I think it has been beneficial.

Mr, OsMERS. We have had so much evidence submitted to the
committee that the location of a great many of these defense indus-

g568 WASHINGTON HEARINGS

tries has upset the entire economy of communities — counties and
large parts of States — because there weren't facilities at the sites
that have been selected.

Now, I want to make clear first, before we get into the questions
on the subject, that I realize that certain plants, we will say an
aluminum plant that must have power, must be built where the
power is and not some place else, and we know that you can't put
a powder plant in the middle of a large city. We wouldn't want it
there. But I Avould like to make this comparison : Before the United
States Army moves men into a cantonment that cantonment must
have sanitary facilities, housing, pure water, sleeping quarters, rec-
reation quarters, and so on. Do you feel that the Government is as
careful of the health and welfare of its civilians as it is of its armed
forces ?

Mr. TowNSEND. No; I am afraid not.

Mr. OsMERS. Don't you feel that we should devote as much attention
to that as we devote to the military side of it ?

Mr. TowNSEND. I think we should be just as much concerned, yes,
sir ; but you can realize that the problems are greater because in the
latter case you are dealing with free citizens — they are allowed to live
wherever they care to.

Mr. OsMERS. They are allowed to live where they care to but they
have got to live wherever they are. They can do as they please but
if they are going to work on a certain project, any hypothetical one
you might mention, they have got to live there.

Now, I don't think, just as a citizen, that it is fair to make these
thousands of American citizens move into these areas where there is
is no place for them to live and no place for their children to be
educated: where their health is endangered. Frankly, it is my per-
sonal opinion that we have done a very poor job throughout.

Mr. TowNSEND. Well, beyond initial consideration in selecting sites,
that has not been particularly an obligation of our Board.

FACTORS CONSIDERED BY PLANT-SITE COMMITTEE

Mr. OsMERS. What are the factors — we will put it this way to get
to the work of your Board — what are the factors that your Board
considers when a proposal comes from anywhere — from a manufac-
turer or from a branch of Government, to locate a plant in any part
of the country?

Mr. TowNSEND. One of the first things our Board wants to know
is. Is there labor available in that area ? and we consider that within
a 20-mile radius. That is first. Secondly, If labor is available, is
there housing available for them? That is also considered by our
Board.

You have other limiting factors, like I said about a powder plant,
it must have a great volume of water ; it must have certain elevation ;
it must be above flood areas; they like to have two railroads running
through them — one each way so that they can have a choice in case
something happens to a railroad; they must get their materials out
by the other road; so occasionally it is' just almost necessary to locate
an industry where there isn't sufficient housing.

There may be in that part of the country a large surplus of unem-
ployed, and you would like to employ them and you must locate there,
but there may be an inadequate housing situation. Thus, a plant is

NATIONAL DEFENSE MIGRATION 6569

sometimes located in an area that lacks adequate liousine;. _ Then
that becomes somebody else's problem. We figure it is the obligation
of some other unit of the Government to see that they are taken
care of.

Mr. OsMERS. If those factors have been considered in the location of
our plant sites, why is it that we have this apparent dislocation of
workers and lack of housing and other public facilities in places where
they have gone ? I mean we have had so many examples of it before
this committee that it would be just repetitious to go into all of the
places where conditions are very bad.

Mr. Tow^NSEND. Well, it is clear that it would be impossible to locate
all of these industries, taking into consideration their peculiar require-
ments, where there is sufficient housing and unemployed.

Mr. OsMERS. AVell, of course, my answer to that would be that before
the site was selectecl, and they built the plant, that the United States
Housing Authority should come in and make provision for it. That
would be my answer to that quickly.

Mr. TowNSEND. I will agree with you.

Mr. OsMERs. And if there was a school shortage, you would have
the Office of Education in there to make some provision for that;
and if it were determined that they weren't going to have proper
facilities, you just wouldn't locate the plant there.

Mr. TowNSEND. That is right.

YARDSTICK FOR LABOR SUPPLY

]Mr. OsMERS. Now, Congressman Arnold touched briefly on the
question of agricultural employment. How do you determine when
there is a shortage of labor?

Mr. Town SEND. Well, a bureau of the Department of Agriculture
keeps a statistical record — they have certain farmers in localities who
furnish them with that information.

Mr. OsMERS. How accurate is that service ?

Mr. TowNSEND. It is only comparatively accurate. It is not abso-
lutely accurate. It only secures the opinion of those farmers. It
would be impossible to make a detailed survey. My Office, the Office
of Defense Relationship, has a State and Federal service made up of
workers already in the Department of Agriculture and not new
employees, headed by the chairman of the Agricultm-al Conservation
Program Committee in each county and each State, and we are begin-
ning now to get from them reports on the farm-labor situation. We
will get it continuously from now on.

I am of the opinion, from what information I have now, that it will
be acute this year only for seasonal workers — like picking tomatoes
and picking fruit. There is also going to be a shortage that will
be severe in the dairy industry, because that requires highly skilled
labor. A dairy manager is a highly skilled individual. We have
reason to believe that in 1942 that shortage is going to be even more
serious.

Mr. OsMERS. Well, these reports whicli have emanated from the
Agricultural Marketing Service have, as I presume you know, caused
some needless and injurious migration.

In other words there has been given publicity to the fact that there
is a shortage of labor in a certain area and naturally, if you or I were

g570 WASHINGTON HEARINGS

out of a job, the first thing we would do would be to get in our car
and run to that area and if we got to the area found out that the
reported shortage did not exist, we would become an economic and
social problem and a bother to ourselves.

There are several criticisms of that Marketing Service that has come
to my attention and to the attention of the committee. I would like
you to pass j^our judgment on it. I am going to read some of them.
Their sample is very small. Only 22,000 of the reporters queried, and
of these about only 5,000 answered the question.

Do you think any reliable estimates can be made on the basis of
such a small sample ?

Mr, TowNSEND. Well, I think it is better than no report at all. Of
course it really couldn't be accurate but sometimes a straw vote is
indicative. The Agricultural Marketing Service reports refer to the
supply of labor as a percentage of normal and in comparison with
earlier periods. I feel sure that their employment reports are secured
from less than half of all of the reporters since only about 25 percent
of our farmers hire laborers during certain seasons, while approxi-
mately half of the farmers never hire labor.

UNPREDICTABLES IN FARM LABOR NEED

Mr, OsMERS. It is very hard, is it not. Governor, to estimate an
agricultural labor shortage, particularly in the harvesting of crops,
and that is when it is always acute, until after the shortage has de-
veloped and you have tried to hire men? In other words, the har-
vesting may start tomorrow and you may not have a man on the place
today, but in the morning they will arrive in truckloads and you
wouldn't know until tomoiTow noon whether there is going to be a
shortage ?

Mr, TowNSEND. That is right.

Mr. OsMERS. Now, the Marketing Service has no base year by which
to compare its reports from year to year, and there is no way of
knowing what the reports of one month or one year mean, when
compared with previous years. Now, in view of that what signifi-
cance can we place on these, figures ?

Mr, TowNSEND. Well, they compare this year with last year. That
helps some.

Mr. OsMERS. They do compare one year with the previous year?

Mr. TowNSEND. Yes, They gave me the fact that the supply was
71 percent of the demand this year, and 102 percent of the demand
last year. That was a comparative figure.

I am not at all acquainted with the Marketing Service's methods.
I have had nothing to do with it. I got a little information from
them for this study and that is about all I know about them. They
gave me the comparison of the 2 years and I thought that was
helpful, but I will admit it looked like a big variation. I am not so
sure, however, that a base period would be helpful. Other factors
might easily outweigh the apparent desirability of a base period.
Some such factors would be mechanization, the changing relationship
of acres and yields of particular crops to total acres and total produc-
tion, differences in labor requirements, shifts of crop acres from areas
of high labor requirement areas to low labor requirement areas, and

NATIONAL DEFENSE MIGRATION 6571

SO on. In the end, it is conceivable that a base period might be less
desirable than the farmer's opinion, which is compared with his needs
over a period of years.

Mr. OsMERS. Well, from an economic standpoint, it is to the inter-
est of the farm employer to create a labor surplus, isn't it? And
isn't it likely therefore, that some of them would color their reports,
in order to produce that surplus and thereby lower the cost of their
labor?

Mr. TowNSEND. That is possible ; yes, sir.

Mr. OsMERS. Would you say that we need, particularly with ref-
erence to farm labor, some new and wider method of reports?

Mr. TowNSEND. It could be very helpful, and especially in a time
like this or in a time of depression — in any abnormal time — both to the
worker and to the employer.

Mr. OsMERS. There are so many of these workers who migrate. I
am thinking of the situation in the State of New Jersey. The com-
mittee examined it last year. Technically, at the moment we are
probably 3,000 short on potato diggers, but they are not going to
aig potatoes for probably another month.

Now, these people have normally come up from the South every
summer and have done the potato harvesting and have gone back.
Now, we won't know and haven't any way of knowing whether they
are all going to arrive this year or not.

Mr. TowNSEND. And probably no system could be devised that
would give you that information.

Mr. OsMERS. Do you think that an extension of the United States
Employment Service and its component State services w^ould help?

DIVISION OF LABOR UNIT STUDYING MIGRATION

Mr. TowNSEND. State employment services plus Federal direction
within and between States would be helpful.

Now, I have a labor unit in my Office of Agricultural Defense Kela-
tions — of course, I have only one or two men in it — but I am going to
use that. I have been with them, and they have given me quite a little
information as to how they operate, and I think they are going to be
quite helpful in getting special migratory labor.

They are not going to lielp much with the single farm hand ; they
are going to work on migratory labor, and I think they are going
to be very helpful. We are going to depend on the committees, of
Avhich the chairmen of the A. C. P. connuittees are the chairmen of the
county committees, to get us information as to where the labor is
needed, and then we will transmit that request to the farm placement
division of the employment service, and they will try to get the labor
brought in there.

The laboi- will have to come, of course, from these areas where there
is still some surplus farm labor.

Mr. OsMERS. Farm labor is so important in computing the cost of
living that we should try to regulate it and adjust it in some way so
there will be even employment and steady income, because we are
starting in that fatal spiral now, and any sharp upset in the farm-
labor situation will only accentuate it.

g572 WASHINGTON HEARINGS

Mr. TowNSEND. Well, it is going to be a great problem, the great-
est we have ever experienced.

Mr. OsMERS. It has been suggested that agricultural employers'
views on farm labor reflect directly what they hear about industrial
employment and not what the actual situation is. If this is true,
the reports of the Agricultural Marketing Service would bear no
relationship to the actual labor situation.

That is all I have, Mr. Chairman.

Mr. Arnold. I have one more question.

FEDERAL. PLANT PLACEMENT WIDER THAN PRIVATE

How does the centralization of Government-financed plants com-
pare with the centralization of privately financed expansion of facil-
ities? Is there any more decentralization of those plants that you
finance for private industry than there is of those they build them-
selves ?

Mr. TowNSEND. The decentralization has been much better with
Government-financed plants than with private plants.

Mr. Arnold. I mean those built for private industry?

Mr. TowNSEND. Yes; I think so. The Government naturally
would have a little more freedom.

Mr. Arnold. But you consult private industry as to where they
think the best location is for the plant you are building for them ?

Mr. Townsend. Oh, they come to us for approval of the plant
site. They have already decided where they want to locate their plants,
but so many of their projects have been expansions of present plants.
You see, private industry has built very few entirely new plants. It
lias been largely expansion of their existing plants.

Mr. Arnold. And those financed by the Government are practically
all new enterprises, and consequently the Government has a better
opportunity to select their site?

Mr. Townsend. That is correct.

Mr. Arnold. That is all.

post-defense outlook as factor

The Chairman. Governor, I just have one question to ask you:
In arriving at a determination for the location of one of these
defense plants, does your commission take under consideration the
fact, for example, we had 5,000,000 agricultural workers unemployed
last year? Do you take into consideration the fact that after this
emergency is over, with millions of people going from their old
States to States where they get better positions in these defense
projects, any plant that is decentralized and set out where there is
an excessive labor supply is going to have a very decided effect on
the migration between States after this emergency is over?

Mr. Townsend. Oh, yes. Probably one of the first things we
think about is in that connection, but here is your problem.

You take a powder plant and you put it out in Arkansas or West
Virginia in the coal region, or in southern Illinois, where there are
a great many unemployed people. You put the plant there. The
workers are there, and they need the work, and they are glad to

NATIONAL dp:fensp: migration ()573

work, but when the effort is over and the powder plant is closed,
we may be faced by a serious situation. But we believe it is better to
do that than to have those workers go into some great center and make
their money and spend it there and after it is over go back to that
community.

If they live there even for 3 or 4 years and work and earn the
money, a part of that money will still remain in the community if
they don't keep it themselves, and the economic situation will be
better than if they went away and then came back.

Our policy is to try, so far as possible, to take the work to the
worker rather than to take the w-orker to the work.

The Chairman. I was wondering if you considered that a factor.

Mr. TowNSEND. I would say that is our first consideration.

The Chairman. I think the figure is now that about 2,000,000 have
left their home States and migrated to other States.

JNIr. TowNSEND. Yes.

The Chairman. And it will probably run up to three or four mil-
lion before this is through — nobody know^s — and when this emerg-
ency is over and the defense projects close down, there is going to
be a whirlpool of migration unless we can keep as many as possible
at home.

]Mr. TowNSEND. There is bound to be a back-to-the-land movement
for them. It is going to be, undoubtedly, a serious economic problem.

Mr. Arnold. Is it your opinion. Governor, that if a powder plant,
employing, say, from three to six thousand people, were placed in a
community that has no surplus labor to speak of, would that com-
munity be worse off after this emergency is over than if it had not
been located there in the first place?

Mr. TowNSEND. Such a plant might be definitely a liability; yes,
sir; definitely a liability. They located a shell-loading plant in my
State. I knew nothing about it. I was Governor at the time. If I
liad known about it I would have certainly done everything I could
to have kept it from being located there. There was not a great deal of
unemployed labor there, and it is going to be a definite headache for
rhe State of Indiana after it is over. The hope of such communities,
however, is to develop peacetime industries after the emergency.

The Chairman. Well, thank you very much. Governor. You have
been very helpfid to us and very kind to us, and we appreciate your
being here.

We will adjourn until tomorrow morning at 10 o'clock.

(Whereupon, at 1 p. m., the committee adjourned until 10 a. m,,
Thursday, July 17, 1941.)

NATIONAL DEFENSE MIGRATION

THURSDAY, JULY 17, 1941

House of Representatives,
Select Committee Investigating

National Defense Migration,

Washington^ D. G.
The committee met at 10 a. m., pursuant to notice, Hon. John H.
Tolan (chairman) presiding.

Present were Representatives John H. Tolan (chairman), of Cali-
fornia; Laurence F. Arnold, of Illinois; Carl T. Curtis, of Nebraska;
and Frank C. Osmers, Jr., of New Jersey.

Also present were Robert K. Lamb, staff director; Mary Dublin,
coordinator of hearings; Creekmore Fath, acting counsel; F. Palmer
Weber, economist; and John W. Abbott, chief field investigator.
The Chairman. The committee will come to order.
Our first witness is Mr. Donald M. Nelson. Director of the Divi-
sion of Purchases, O. P. M.

TESTIMONY OF DONALD M. NELSON, DIRECTOR OF THE DIVISION
OF PURCHASES, OFFICE OF PRODUCTION MANAGEMENT, WASH-
INGTON, D. C.

The Chairman. Mr. Nelson, I have read your statement and have
an outline of it and I believe it will be a very, very valuable con-
tribution to our record.

I am very pleased to know that you are intensely interested in this
subject of migration.

Mr. Nelson. I am, sir. I think it is the most important single thing
before us.

The Chairman. This committee found last year in traveling north
and south and east and west, holding hearings in many places, that
there are about 4,000,000 migrants going from State to State, and that
number has been increasing year by year. We made a report to Con-
gress on the general subject of migration, which contained some
recommendations.

Following that the committee was continued for this year by Con-
gress W'ith the idea that migration would increase on account of our
national-defense program, which we have found to be true.

6575

60396 — 41— pt. 16-

g576 WASHUSGTON HEARINGS

(The following stfitement was submitted by the witness:)

STATEMENT BY DONALD M. NELSON, DIRECTOR, DIVISION OF
PURCHASES, OFFICE OF PRODUCTION MANAGEMENT, WASHINGTON,
D. C.

Distribution of Ordeks and of Facilities Contkacts, War and Navy Depart-
ments, Thkough June 30, 1941

The major purpose of the Division of Purchases in the Office of Production
Management is to serve as an aid to the armed forces in getting wliat they
want, in the quanlities desired, and at the times specified, with the fewest
possible disturbing effects upon the domestic economy. One disturbing effect,
both immediate and for the long run, would be a large and disorderly migration
of laborers. Consequently, the Division of Purchases has consistently sought
to advise the placing of defense orders in such places and in such manner
as to cause a minimum of labor migration.

Probably it is unnecessary to point out that in the placing of defense orders
by the War and Navy Departments, many factors other than local labor sup-
ply must play a large part, and sometimes a predominating part. For instance,
aircraft and aircraft motors, especially during the early months of the defense
program, had not enough potential laborers in their immediate vicinities to
supply the necessary work forces to handle the growing needs of our armed
forces and of other democracies. Nevertheless, the dictates of speedy delivery
and high quality practically compelled the placing of large orders with existing,
though undermanned, plants. Such plants had to draw laborers from varying
distances, probably in many cases from long distances.

More generally, the problem of the placing of orders, whether for supplies
or for new facilities to produce supplies in the future, is one which almost
invariably involves compromise in the final decision. Whether to give orders
to industrial districts already equipped and manned, or to seek new industries
and locations, is a question which very often cannot be settled to the full
satisfaction of all points of view. What must be done, and what we have tried
to do, in ct)operation with the War and Navy Departments is to make recom-
mendations which will reflect the best possible compromise between conflicting
factors. I can say that one of our basic policies has been to avoid insofar as pos-
sible both undue concentration of orders and undue centralization of industry.
Clearly, it would be undesirable to allot so many orders to overworked com-
munities as to exaggerate inward migration of laborers and thus lead to
unhealthy congestion. Likewise, it would be unwise to erect so many new
facilities in outlying areas as to cause mushrooming of temporary towns.

In this connection, a further factor must always be recognized — that is, as the
defense program grows, with its demands on both labor and materials, produc-
tion for civilian use is bound to be curtailed in many lines of business. One
result is the progressive unemployment of former civilian-goods workers, and
to meet this progressive change, we need to allot defense orders, so far as
feasible, to tlie areas where transfer of workers to defense projects can best
and most speedily be carried out.

DISTRIBUTION PATTERN OF ORDERS

Broadly, the distribution of Army and Navy orders has tended to follow rather
than to deviate from the previously existing pattern of industrial activity. This
broad tendency is reflected by the data in table 4. Specifically, concerning labor,
those figures show that up through June 30, 1941, War and Navy orders have
followed labor, with few exceptions. Thus New England, with 12.1 percent of
the total manufacturing workers in the United States, has received 12.9 percent
by dollar value, of military contracts; the Middle Atlantic States, with 28.6
percent of workers, have 27.3 percent of orders ; the East North Central States,
with 27.8 percent of workers, have 18.4 percent of all military orders (but 27.2
percent of War Department orders alone) ; the West North Central States,
with 4.8 percent of total workers, have 5 percent of total orders; the South
Atlantic States, with 12.6 percent of workers, have 11.3 percent of orders; the
East South Central States have 4.6 percent of workers and 3.5 percent of orders:
West South Central States have 3.4 percent of workers and 5.4 percent of orders ;
Mountain States have 0.7 percent of workers and 1.2 percent of orders; and
Pacific States have 5.4 percent of workers and 15 percent of orders.

NATIONAL DEFENSE MIGRATION g577

When we consider the distribution of War and Navy contracts for new facili-
ties, liowever, there are sharper contrasts. In part, new facility locations are
determined by strategic factors, which are purely for military authorities to
decide upon, and in part, by economic considerations. But the figures (table 4)
show that new facilities contracts have been placed much more detinitely away
from highly industrialized areas. Thus, New England, with 12.1 percent of
manufacturing workers, has received 6.7 percent of new facilities; the Middle
Atlantic States, with 28.6 percent of workers, have 19.1 percent of new facilities.
A reversal is found in the Bast North Central States, which, with 27.8 percent
of workers, have 32.8 percent of new facilities. The general tendency toward
decentralization appears, however, in the West North Central, with 4.8 percent
of workers and 8.2 percent of facilities. In the South Atlantic States the
percentages are the same, 12.6 percent of workers and of facilities. In the East
South Central States there are 4.6 percent of total workers but 8.5 percent of
facilities. In the West South Central workers and facilities are about the
same, 3.4 percent and 3.9 percent ; in the Mountain States there are 0.7 percent
of workers, but 3.5 percent of facilities; and in the Pacific States there are 5.4
percent of workers and 6.4 percent of new facilities.

In summary, I would say that supplies contracts have followed the location
of industry and its workers ; but that new facilities have been planned to follow
a policy of at least partial decentralization.

PROCEDURE IN DECIDING NEW PLANT LOCATIONS

The decisions on new plant locations are made only after most thorough
analyses by military boards and by the civilian advisory boards, including re-
cently the Plant Site Board. I should like to offer the following description
of the work of this Board, established several mouths ago by the Office of Pro-
duction Management (as referred to in the exhibits submitted separately).

First as to procedure — the initial negotiations for tlie selection of sites
for new industrial facilities in connection with the defense program are in
the hands of the technical agencies responsible for assuring an adequate supply
of the articles to be produced. Thus, the Ordnance Department of the War
Department has first responsibility for securing locations for new powder
plants; the Air Corps of the War Department works with the operating com-
panies in the selection of sites for new aircraft facilities; the Bureau of Ships
of the Navy Department is responsible for initiating proposals for new facilities
to build war vessels; the Maritime Commission develops proposals for the con-
struction of new ways to build additional ships for our merchant marine; and
the Office of Production Management, Raw Materials Division, takes the first
steps in finding suitable locations for new plants in the raw materials field,
such as steel, aluminum, and magnesium.

However, it would be wrong to give the impression that these are airtight
compartments. Depending upon the extent of expert assistance their personnel
is able to provide, the staff of the Production Division of the Office of Pro-
duction Management works closely with the War and Navy Departments in
the selection of both operating companies and the sites at which new operations
will be carried on. The Shipbuilding Section of the Office of Production Man-
agement works actively with the Maritime Commission and the Navy Depart-
ment in developing the new facilities necessary to supply equipment for the
over-all shipbuilding program. The Air Corps of the Army and the Bureau of
Aeronautics of the Navy Department work together closely, blocking out the
particular fields in aircraft expansion for which each will be responsible. Thus,
for example, the Navy Department has assumed first responsibility for expanding
facilities for the manufacture of Pratt & Whitney engines, while the Army
provides the funds and makes the plans for expanding capacity for the pro-
duction of Wright engines. In each case there is close coordination between
tiie two agencies through both the Office of Production Management and the
staff of the Army-Navy Munitions Board.

It will be convenient to illu.strate the procedure from this point on with a
sample project initiated by the Ordnance Department of the War Department.
The officer in charge of the program prepares a statement describing the
site proposed. Indicating its requirements in terms of labor, power, trans-
portation, water, raw materials, etc., and how it is proposed that they be met
at this location. This proposal is submitted to the War Department Facilities
Board, established in the office of the Under Secretary of War. Tliis Board is
headed by Gen. H. K. Rutherford. The War Department Facilities Board trans-
mits the proposal with all available information about it to the Plant Site Board

6578

WASHINGTON HEARINGS

of the Office of Production Management. The Plant Site Board is composed of
five members appointed by the Director General, acting in association with the
Associate Director General of the Office of Production Management. At the
present time. Donald M. Nelson. Director of the Division of Purchases of the
Office of Production Management, is chairman. The other members are E. F.
Johnson, Chief of the Ordnance Macliine Tools and Aircraft Section of the Pro-
duction Division of the Office of Production Management ; Eli Oliver, labor rela-
tions adviser to Sidney Hillman, Associate Director of the Office of Production
Management ; and Gov. Clifford Townsend, Director of the Office of Agricultural
Defense Relations in the United States Department of Agriculture. There is one
vacancy due to the resignation from the Office of Production Management of S. R.
Fuller, who, in addition to being a member, was Chief of the Raw Materials
Section of the Production Division of the Office of Production Management.

DATA OBTAINED BY PLANT-SITE BOAKD

On the basis of the requirements submitted with the proposal the staff of
the Plant Site Board secures all available data with respect to the resources
of the community in which the plant is to be located which will throw light
on its ability to meet these requirements. Particular emphasis is put on the
availability of labor at the time the plant can get in operation, the availability
of power at that time, the supply of vacant houses in case workers must be
imported, the character and quantity of training equipment and facilities in
case workers must be trained, where large acreage is involved the nature of
the land to be purchased, the number of persons who must be dispossessed,
and the relation between the location and the sources of raw materials and the
destination of finished products.

In addition the Plant Site Board is Instructed in the regulation establishing
it to "seek insofar as it can do so consistently with due expedition of the
program of defense production and appropriate factors of military strategy to
facilitate the geographic decentralization of defense industry and the full em-
ployment of all labor and facilities."

In securing the data for the use of the Plant Site Board reliance is placed
primarily on existing Government agencies and no considerable staff has been
built up for the Board itself. For example, in checking on the availability of
power, comments are secured from the Defense Power Unit of the Federal
Power Commission and from the power consultant to the Office of Production
Management. The availability of housing is checked with the Coordinator of
Defense Housing and other public facilities, such as schools, hospitals, sewage
and water facilities, with the Office of the Coordinator of Health, Welfare, and
Related Defense Activities. For labor supply principal reliance is placed on
the Labor Division of the Office of Production Management which bases its
conclusions on the reports received from the field offices of the Bureau of
Employment Security with its 1,500 public employment offices, the estimates of
labor requirements received from the Bureau of Labor Statistics, and on data
on agricultural employment provided by the Office of Agricultural Defense
Relations. General comments and data are secured from the National Re-
sources Planning Board and from the Plant Location Section of the Bureau
of Research and Statistics of the Office of Production Management. In this
way prompt and expert advice is secured without duplicating existing agencies
or personnel.

Whenever it seems likely that the data assembled will raise questions about
the locations proposed, those persons in the War or Navy Department responsi-
ble for the original selection are invited to attend the Board meeting and
work out with the Board the most satisfactory solution of the problem.

BILLION DOLLARS IN APPROVED PROJECTS

From April 30, when it cleared its first project, through June 30, the Board
formally approved 169 projects involving a total investment of .$1,047,593,999.

Notice of Board action is returned to the War Department Facilities Boards
which, on the basis of the recommendation of the Office of Production Manage-
ment Plant Site Board and of its own infoi'mation on similar subjects, but
more particularly on its views with respect to military strategy and related
problems, makes a recommendation to the Under Seci-etary of War. Action by
him is followed by clearance with the President.

NATIONAL DEFENSE MIGKATION 6579

An almost identical procedure is followed with projects initiated in the Navy
Department. Their Facilities Board is headed by Capt. A. B. Anderson.

There are certain types of projects which involve increased facilities for
producing basic raw materials, such as steel, aluminum, and magnesium, and
are hence primarily the responsibility of neither the War nor Navy Department.
In these cases the commodity experts of the Production Division of the Office
of Production Management usually take the lead although working in close
cooperation with representatives of the War and Navy Departments. For ex-
ample, in the case of the recent new plants for the production of aluminum the
Office of Production Management made recommendations to the Under Secretary
of War after clearance with the Plant Site Board. The Under Secretary of
War in turn may be expected to make a recommendation to the Reconstruction
Finance Corporation or more likely to its subsidiary, the Defense Plant Cor-
poration, expressing the opinion of the War Department as to the most desira-
ble location, the name of the operating company, and the nature of the plant
On the basis of these data the Defense Plant Corporation proceeds to negoti-
ate a contract for the construction and/or lease of the new facility.

There have also been a large number of cases, particularly Air Corps proj-
ects, in which the cost has been shared by the War Department and by the
Defense Plant Corporation. In all such cases the same procedure is followed
as in the case of projects financed wholly by the War Department, except that
after a final decision has been reached with respect to the location and cost
of the project and the ojjerating company, this is transmitted to the Defense
Plant Corporation which negotiates the contract. However, the 1942 fiscal
year appropriaion act prohibits the War Department from financing the ex-
pansions required for its procurement program through the use of Defense Plant
Corporation funds.

CHECK-UPS ON PLANT- SITE SELECTION

This is formal procedure. As a matter of fact, however, the Plant Site Board
of the Office of Production Management is instructed in the regulation estab-
lishing it to ''seek to work in close cooperation with representatives of each
such departxnent, corporation, or agency from the outset of the process of selec-
tion of the location of any plant or facility." The Plant Site Board feels
strongly that it can be most useful not by vetoing proposals submitted to it
for formal action, but by seeing to it that at the very start of negotiations
careful consideration is given to the factors which are most important in pick-
ing good sites. And again, may I remind you, by good sites the Plant Site
Board is interested in good communities and not, by and large, in particular
pieces of land.

Although there are far too many negotiations going on at any one time for
the Board to keep in close touch with all of them it has adopted several means
which have proved useful in seeing to it that in most cases by the time a proj-
ect gets to it for formal action the site selected is the best possible under the
circumstances. In the first place the Board has made it clear to both the
War and Navy Departments that it is very happy to receive preliminary pro-
posals of sites that are under consideration and to express an informal opinion
with respect to them. At the very outset of its work it requested and received
from the departments a general picture of the program of new facilities as it
shaped up at the time and gave preliminary comments on this program. Since
that time the staff has kept in close touch with both the War and Navy Depart-
ments and with those in the Office of Production Management working on n6w
facilities programs, and they have referred to the Board for preliminary com-
ment nearly all important projects at an early stage of negotiations before a
substantial delay would be caused to the Defense program by the necessity of
seeking a different location than that originally proposed by the operating com-
pany and the service department.

In the case of certain types of plants, such as ammunition plants, a repre-
sentative of the Plant Site Board has gone with representatives of the Ordnance
Department to inspect locations proposed for new plants. Tlie staff of the
Board has also kept in close touch with representatives of the railroads who
are most familiar with possible sites. They have helped greatly in finding
locations in areas which are desirable from the point of view of the Plant Site
Board.

The Board has also expressed general views to the War and Navy Depart-
ments with respect to the types of plants which it felt woiikl most efficiently

g580 WASHINGTON HEARINGS

utilize the resources of various regions of the country, has provided them with
data on communities where housing and labor shortages have occurred and
has recommended lists of communities which seem to deserve prior con-
sideration for various types and sizes of plants.

In a number of cases the service departments have referred to the Board
companies which have been asked to expand and wanted help in picking a de-
sirable location. The Board has been able to be of some assistance in those
cases, not only by reason of the data provided by Government agencies but also
the vast quantities of material submitted to it by local chambers of commerce,
by Members of Congress, by representatives of the railroads, by unions and
by other groups and individuals interested in participating in the defense
effort.

PEACETIME VALtne AS FACTOR

One other point with respect to the way sites or new facilities are selected
may be of interest to you. In the case of new facilities for the production
of aircraft and ships there is frequently some likelihood that the plants will
have a peacetime value. Although the Government is financing their construc-
tion at the moment, it would, of course, like to sell as many of these plants
as possible at the end of the emergency. The best potential purchaser is
usually the operating company. Its interest in purchasing the plant after the
end of the emergency will depend largely on whether the location is considered
to be suitable for peace-time operation in connection with its other manufac-
turing activities. The net result of all this is that in the case of expansions
in these fields the principal initiative in selecting new locations rests with the
operating companies rather than with the Government, although the influence
of the Government is not negligible. However, those of you who are interested
in sites that are suitable for this kind of activity would probably do better
by going to companies with large contracts or subcontracts than by submitting
data about these sites to Government agencies.

In the course of my work I have had to read many dozens of prospecti set-
ting forth the advantages of particular sites for defense plants. I should like
to make one or two comments about the material contained in these prospecti
as it relates to the criteria in which the Plant Site Board is most interested.

Although for many years there has been a large backlog of unemployed
throughout the country this is no longer the case. We now have in many loca-
tions acute labor shortages. In the course of the next year when the greater
part of the new facilities under construction will get into operation these
shortages will be far more widespread. As a result labor supply has become a
key problem in selecting suitable sites for new plants.

TWO LABOR ANGLES IN PLANT-SITE SELECTION

The Board looks at the labor problem from two angles. In the first place, it
is considered undesirable to locate plants where they can only be staffed by the
migration of workers from beyond a reasonable commuting distance. The low
level of activity in the housing industry during the past 10 years has left few
of our cities with a cushion of vacant houses which can absorb migrant workers.
To build new houses for them is not only expensive to the Government but
involves a substantial diversion of resources which could better be devoted to
defense production — resources of men, materials, and transportation facilities.
This situation has become sufficiently acute in the materials fields that it has
been necessary to establish special priority provisions to insure the delivery of
materials for the construction of defense housing.

The definition of reasonable commuting distance will vary from one part
of the country to another as commuting customs differ. Certainly, however,
data on the labor available in an entire State are always irrelevant. As an
average we are using 30 miles. In some parts of the country it is reasonable to
draw a circle with a 30-mile radius. In others where the highway network
is less satisfactory it is necessary to examine the highway facilities carefully.
Attention must be paid to mountain ranges which require a roundabout ap-
proach and to toll bridges which make commuting from certain directions
expensive.

The second principal problem is determining how many unemployed persons
are available within the commuting area. This involves finding out not only
how many persons are without jobs but also how many of them would be

NATIONAL DEFENSE MIGRATION 6581

interested in tlie particular type of work ofcered by the new plant and could
be expected to meet its requirements, both in terms of sex, age, race, citizen-
ship, physical fitness, and occupational skill. Once a satisfactory inventory is
made of the unemployed, including those only partially employed on low-
income farms, it is necessary to anticipate the number of new jobs which will
be created by contracts already signed either within that commuting area
or in nearby cities to which workers will migrate from the area under con-
sideration. Some allowance must also be made for the secondary efforts of
defense employment in creating jobs in service and trade establishments. I
cannot emphasize too greatly the importance of considering not only present
unemployment but anticipated unemployment at the time the proposed plant
will be hiring new workers.

PRIOKITIIuS AN IMPONDERABLE FACTOR

A new complicating factor has been introduced into this picture during
recent months by the curtailment of certain types of manufacturing due either
to priorities as in the case of aluminum or to general agreement as in the case
of autos. At the present time these introduce an imponderable factor which
cannot be resolved until more specific information is secured about where
these cuts will be made and what their effects upon employment will be.

The same situation applies to power supply. It is not enough to describe
the generating capacity or the interconnecting lines which can supply power
to the proposed plant. In general the power supply of the country is short.
It is necessary to know in any specific location not only what the capacity is
but what estimated requirements will be as of the time the proposed plant
gets into operation. The pertinent question is what surplus will be left after
meeting existing or already contracted for requirements. It is unwise to
count on interconnection until specific information is secured about the antici-
pated surplus as of a year or more from now of the interconnected systems.

What I have said with respect to labor and power applies to a greater or
lesser extent throughout the whole picture. We are entering a period of
scarcity and shortage. We are building new facilities so rapidly that today's
situation will be wholly changed a year from now. These developments involve
a complete revision in the outlook toward many aspects of plant location which
has quite properly characterized the past 10 years. Prospectuses which take
account of the rapidly changing demand or supply situation for such items as
labor and power will receive more favorable consideration than those which
fail to take account of future developments.

(Eight, tables, six charts, and two additional exhibits, described as
follows, were submitted for the record and appear in order follow-
ing:)

Table 1. — County distribution of War and Navy Department prime contracts
and project orders, June 1, 1940, to June 30, 1941.

Table 2. — Distribtuion of major defense prime contracts awarded by the War
and Navy Departments, by States, June 1, 1940, to June 30, 1941.

Table 3. — Distribution of major defense contracts awarded by the War and
Navy Departments, by Federal Reserve district and industrial area, June 1,
1940, to June 30, 1941.

Table 4. — Percentage distribution of prime contracts and Government-financed
facilities, by regions, as of June 30, 1941.

Table 5. — Regional distribution of value of manufactured products, value of
War and Navy Department prime contracts, and estimated cost of Govern-
ment-financed facilities.

Table 6. — Regional distribution of manufacturing employment, value of War
and Navy Department prime contracts, and estimated cost of Government-
financed facilities.

Table 7. — War Department regional distribution of value of prime contracts and
estimated cost of Government-financed facilities.

Table 8. — Cumulative percentage distribution of prime contracts and Govern-
ment-financed facilities, by regions.

Chart 1. — Regional distribution of the estimated cost of new industrial facilities
financed by War Department funds and total value of manufactured product.

Chart 2. — Navy Department regional distribution of the estimated cost of new
industrial facilities and total value of ninnufactured product.

6582

WASHINGTON HEARINGS

Chart 3. — Navy Department regional distribution of prime contract awards

and total value of manufactured products.
Chart 4. — Navy Department regi(mal distribution of prime contract awards and

total value of manufactured product, excluding aircraft contracts.
Chart 5. — War Department regional distribution of prime contract awards

and total value of manufactured products, including aircraft contracts.
Chart 6. — War Department regional distribution of prime contract awards and

total value of manufactured products, excluding aircraft contracts.
Exhibit 1. — Regulation No. 6. establishing a Plant Site Board in the Office of

Production Management and defining procedure for clearance of the proposed

location of new or additional plants and facilities required for the national

defense.
Exhibit 2. — Regulation No. 6-A, amending Regulation No. 6, dated May 6, 1941,

establishing a Plant Site Board in the Office of Production Management and

defining procedure for clearance of the proposed location of new or additional

plants and facilities required for the national defense.

Table 1. — County distribution of War and Navy Department prime contracts
and project orders,^ June 1, 19.'f0, to June SO, 19'il — All aicards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services *

[Thousands of dollars]

Alabama.

120, 432

Calhoun

Chambers

Covington

Dallas

Elmore

Etowah

Jackson

Jefferson

Lauderdale-
Madison

Mobile

Montgomery.

Talladega

Tallapoosa

2,481

2, 348

564

188

320

17, 284

332

12, 631

2,861

457

39, 755
419

40, 725

Cochise-
Pima___

Arkansas-

Greene

Pulaski

Unassignable-

California 1, 383, 994

Alameda

Contra Costa-
Humboldt

Imperial

Los AngeleS--

Napa

Orange

57, 229

1,299

610, 148

264

2,222

California — Continued.

Sacramento

110

San Bernardino

237, 104

San Diego

San Francisco

__. 244, 576

San Joaquin

1, 992

San Mateo __

Santa Clara __

9,096

Santa Cruz

Solano

222, 531

Sonoma

Tulare

164

Unassignable

116

Colorado-

Denver-
Pueblo-.

Connecticut-

Fairfield

Hartford

Litchfield-
Middlesex

New Haven_-
New London.

Tolland

Windham

New Castle-
Sussex

District of Columbia.

95, 771

91, 168
4,603

611, 737

127, 035

219, 120

1,695

1,306

66, 716

194, 061

286

1,518

6,694

6,248
446

88, 330

^ Project orders are orders for work issued to Government-owned arsenals, shipyards,
manufacturing depots, and the like.

2 The tabulation includes supplies contracts only and does not include contracts for
facilities except for a relatively small amount of manufacturing equipment included in a few
supplies contracts.

NATIONAL DEFENSE MIGRATION

6583

T4BLE 1— County distribution of War and Navy Department prtme contracts
and project oi'ders, June U W.'iO, to June 30. l!)J,t—All awards having value of
$10M0 or more excluding construction, construction materials, fuels, food-
stuffs, and sei-vices — Continued

[Thousands of dollars]

Florida -

Bradford

Dade

Duval

Escambia

Franklin

Hillsborough.

Lee

Manatee

Monroe

Okaloosa

Pinellas

Sarasota

Unassignable-

Georgia.

Barrow

Bibb

Carroll

Chatham

Clarke

Cobb

Colquitt

Coweta

De Kalb

Floyd

Fulton ^-

Grady —

Habersham —

Jenkins

Meriwether

Muscogee —

Polk

Pulaski

Richmond

Rockdale

Spalding

Stephens

Troup

Upson

Walker

Walton

Washington-

Illinois.

Adams

Alexander-
Boone

Champaign-
Cook

De Kalb—.

De Witt

Du Page

Effingham-
Henry

Jo Daviess-.

74, 334

3,054

' &44

5,392

302

58, 778

113

529

5,083

42, 712

373

235

5,128

302

197

600

334

16, 894

275

112

803

295

166

276

5, 893

1, 178

9, 052

139

280, 190

1,179

525

216, 711

498

339

126

2,096

135

Illinois — Continued.

Kane

Kankakee

Lake

La Salle

McDouough

McLean

Macon

Madison .

Marshall

Massac

Montgomery

Morgan

Ogle

Peoria

Rock Island

St. Clair

Sangamon

Stephenson

Vermilion

Wayne

White

Whiteside

Will

Winnebago

Unassignable

2,604

219

623

1,258

7,864

241

615

17, 052

1,001

385

124

343

725

234

19, 150

5,574

Indiana 231, 211

Adams

Allen

Bartholomew-
Blackford

Boone

Cass

Clark

Decatur

Delaware

Elkhart

Floyd

Fulton

Grant

Hamilton

Henry

Howard

Huntington-
Jackson

Jay

Jefferson

Kosciusko

Lake

La Porte

Lawrence

Madison

Marion

Noble

Perry

Ripley

St. Joseph

3,257

676

407

565

323

41, 929

1,073

192

1,247

693

1,072

422

589

539

2,861

28, 440

6,415

76, 455

497

132

59,404

6584

WASHINGTON HEARINGS

Table 1. — County distribution of War and Navy Department prime contracts
and project orders, June J, 191,0, to June 30, 19i1 — AH awards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services — Continued

[Thousands of dollars]

Indiana — Continued.

Vanderburg

Vigo

Wabash

Wayne

Unassignable

Iowa.

Black Hawk-
Ceiro-Gordo-

Clinton

Dubuque

Floyd

Iowa

Jefferson

Linn

Polk

Scott

Webster

Woodbury

Kansas-

Atchison

Bourbon

Cherokee

Montgomery-
Sedgwick

Wyandotte

Kentucky-

Bell

Boyd

Caldwell

Campbell

Christian

Daviess

Estill

Fayette

Franklin

GraA'es

Jefferson

Kenton

Warren

Liouisiana.

Caddo

Jefferson

Orleans

Rapides

Unassignable-

1,759
101
654

1,127
49

6,789

143

426

381

3,268

551

1. 699

188

79, 917

167

68
40

75, 319

4, 287

3,984

42
61
31

143
38
17
69
17

355

2,839

300
37

11, 723

233

245

11. 025

205
35

Maine 384, 874

Androscoggin-
Cumberland—

Franklin

Hancock

Kennebec

3,827

1,866

862

922

ine— Continued.

Knox _

1,666

Lincoln

4, 007

Oxford

Penobscot

433

Piscataquis

382

Sagadahoc 169,907

Somerset 748

York 96

Unassignable 84

Maryland 307, 344

Anne Arundel 1.185

Baltimore 1, 080

Baltimore City 296, 501

Cecil 2, 975

Charles 18, 047

Dorchester 997

Frederick 35

Howard 42

Montgomery 12

Prince Georges 177

Somerset 182

Washington 13, 122

Wicomico 89

Unassignable 60

Ma ssachusetts-

Barnstable

Berkshire

Bristol

Essex

Franklin

Hampden

Hampshire

Middlesex

Norfolk

Plymouth

Suffolk

Worchester—
Unassignable.

934, 794

3,552

5,088

19, 973

777

40, 122

744

17, 419

520. 490

9,795

288. 208

27, 459

1,139

Michigan 677, 489

Alpena

Bay

Berrien

Branch

Calhoun

Chippewa

Eaton

Genesee

Grand Traverse-
Hillsdale

Houghton

Ingham

Ionia

Jackson

Kalamazoo

Kent

208

18, 998

2,771

1,047

7,566

1,100

24, 717

436

249

1,227

4,579

1,291

NATIONAL DEFENSE MIGRATION

6585

Table 1. — County distribution of War and Navy Department prime contracts
and project orders, June J, J9iO. to June 30. 191(1 — AU awards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services — Continued

[Thousands of dollars]

Michigan — Continued.

Lapeer

Lenawee

Macomb

Manistee

Marquette

Menominee

Midland

Muslvegon

Oakland

Ottowa

Saginaw

St. Clair

St. Joseph

Washtenaw

Wayne

Unassignable

Minnesota.

Blue Earth..

Brown

Cass

Dakota

Freeborn

Hennepin

Ramsey

Rice

St. Louis

Steele

Winona

Mississippi-

Alcorn

Forrest

Hinds

Jackson

Jones

Lauderdale

Lee

Lincoln

Lowndes

Marion

Newton

Pearl River

Union

Missouri.

Audrain-
Boone

Buchanan-
Cass

Clay

Cole

Dent

Dunklin-
Franklin

Greene

Jackson__.
Jasper

396

14, 055

444

487

47, 392

155, 180

114

15, 462

2,558

3,786

371, 647

839

37, 981

28
16
50
93

154

34, 672

1,910

536
25

400

52, 038

24
50, 000

12
209

15
2.54
530

64
284
304
178

276, 805

200

3,294

245

168
24
23

448
8,434

629

Missouri — Continued.
Johnson

297

New Madrid..

203

Pettis

178

751

St. Charles

26. 255

St. Francois

173

St. Louis

66, 828

St. Louis City

Saline

Scott

Unassignable

126, 971

211

61, 143

Montana : Cascade-
Nebraska

45
4,266

Adams

Douglas—-

Gage

Lancaster-
Otoe

229

3,227

180

607

Nevada: Mineral-
New Hampshire-

Belknap

Chesire

Coos

Hillsborough.

Merrimack

Rockingham-
Strafford

Sullivan

Unassignable.

285
107, 984

444

371

195

4,791

957

98, 892

2,170

113

New Jersey 1, 450,

Atlantic

Bergen

Burlington

Camden

Cape May

Cumberland

Essex

Gloucester

Hudson

Mercer

Middlesex

Monmouth

Morris

Passaic

Salem

Somerset

Union

Warren

Unas.signable

57,

28,

356,

18,

154,

298,
5,

22.

152

126
594
113
753

088
009

872
597
4C16
603
558
101
247
817
869
577

New York 1. 486, 255

Albany-
Allegany.

20, 998
199

6586

WASHINGTON HEARINGS

Table 1. — County distribution of War and Navy Department prime contracts
and project orders, June 1, 19ji0, to June SO. 19U — All awards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services — Continued

[Thousands of dollars]

New York — Continued.

North Carolina— Continued.

Broome

7,597

Edgecombe

168

Cattaraugus

9©

Forsytli

Gaston

l>13

Cayuga

7, 247

2,743

Chatauqua

8, 560

Guilford

3,935

Chemung

8,127

Halifax

Chenango

1,444

Iredell

198

Columbia

Lenoir

105

Delaware

991")

1,621

Dutchess

9, 593

185, 486

New Hanover

Erie

Pasquotank

528

Fulton

1, 509

Randolph

167

Genesee

221

Richmond

424

Herkimer

625

Rockingham

1,430

Jefferson

471

Rowan

142

Livingston

3, 168

Rutherford

213

Madison

1,246

Surry

7,741

Monroe

65, 655

Vance

2,190

Montgomery

431

Wake

Nassau

121, 868

Yadkin

New York

774, 160

Unassignable

Niagara

1,836

Oneida

37, 781

Ohio

415,443

Onondaga

13, 510

25
687

Allen

Auglaize

114

Orange

265

Orleans .

108

Belmont

135

Oswego

280

Butler

16,076

Rensselaer

3,222

Carroll

Rockland

3, 532

Champaign

208

206

Clark

4,544
37

Saratoga

841

Clinton

Schenectady

170, 616

Columbiana

5.953

Schuyler

Crawford

1,071

Seneca

206

Cuyahoga

193. 074

Steuben

338

Darke

244

Suffolk

6,072

Erie

3,244

Tompkins

J84

Fairfield

Ulster

1,848

Franklin

20, 147

Warren

158

Guernsey

Washington __

1,113

Hamilton

22, 721

Wayne

Hancock

240

Westchester

14, 375

Hardin

Wyoming

331

Harrison

494

Unassignable

109

Highland

906

North Carolina

28,580

Jefferson

15
2,177

Lake

Licking

Alamance

190

131

Alexander

Logan

201

Buncombe

319

Lorain

1,406

Burke

150

Lucas

27, 829

Cabarrus

1, 275

Mahoning

11,088

Caldwell

Marion

1,091

Carteret

Medina

134

Catawba

494

Miami

4,921

Columbus

Montgomery

31,853

Craven

660

Morrow

113

Dare

225

Mushingum

136

Davidson

849

Ottawa

174

Davie

464

28,000

Durham

1,114

Richland

513

NATIONAL DEFENSE MIGRATION

6587

Table 1. — Uounty distribution of War and Nav^y Department prime contracts
and project orders, June J, t9W, to June 30, 194t — AH auxirds har>ino value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services — Continued

[Thousands of dollars]

Ohio — Continued.

Sandusky

Scioto

Seneca

Shelby

Stark

Summit

Trumbull

Tuscarawas —

Van Wert .

Warren

Washington-
Wayne

Williams

Unassignable-

210

522

2,729

9,710

32,168

459

168

147

500

385

31
259

Oklahoma.

2,474

Grady

Muskogee

Oklahoma

Ottawa

Tulsa

Washington

56
343
141

41
160, 729

Oregon.

^,360

Clackamas-

Clatsop

Coos

Douglas

Jackson

Lane

Marion

Multnomah-

1,328

280

129

509

34, 703

Pennsylvania 1, 149, 008

Adams

Allegheny

Armstrong-
Beaver

Berks

Blair

Bradford

Bucks

Butler

Cambria

Carbon

Centre

Chester

Clarion

Clearfield-
Clinton

Columbia

Crawford

Cumberland-
Dauphin

Delaware

Elk

512

75, 834

445

6,866

9, 547

1,040

7,230

6,220

134

130

726

5,273

61, 275

2,911

7,122

14,090

Pennsvlvania — Continued.

Erie

5,474

Fayette

Franklin _ _ _

1,886

Indiana

Jefferson ■.

Lackawanna

1,387

Lancaster

2,549

Lawrence

4,294

Lebanon

243

Lehigh

7,093

Luzerne

5,765

Lycoming

14, 450

McKean

Mercer

7,325

Mifflin

255

Montgomery

37,929

Montour

1,583

Northampton

29, 263

Northumberland

1,759

Perry

Philadelphia

792, 446

Schuylkill

2,708

Snyder

Union

Venango

315

Warren

2. .174

Washington

918

Wayne

160

Westmoreland

10,196

York

18, 065

Unassignable

398

Rhode Island

96, 569

Bristol

5,445

Kent

702

Newport

64,423

Providence .

24, 919

Washington

228

852

South Carolina

144, 651

Aiken

2,081

1,406

Beaufort

513

Calhoun

Charleston

135, 347

Greenville

1,414

Greenwood

1,640

Lancaster

Laurens

Orangeburg

Richland

264

Saluda

670

Spartanburg

813

Union

214

Unassignable

gggg WASHINGTON HEARINGS

Tablk \.— County dixtributiun of War and Nav^y Department prime contracts
and project orders, June 1. fBiO, to June 30. lO'fl — AU awards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and services — Continued

[Thousands of dollars]

Tennessee.

45, 272

Bedford

Blount

Bradley

Campbell

Coffee

Davidson

Gibson

Hamilton

Humphries —

Knox

Lawrence

Marion

Marshall

Rhea

Robertson

Shelby

Sullivan

Unicoi

Williamson

Wilson

Unassignable-

125

19
219

254

4,312

24, 720

7,368

52
5, 461

11
100

49
748
770
106
166

40
489

Texas 156, 072

Arkansas —

Bexar

Brazoria —

Dallam

Dallas

De Witt-
Ellis

El Paso

Grayson

Harris

Hunt

Jeffer.son

McLennan—

Nueces

Orange

Potter

Smith

Tarrant

Taylor

Wharton

Wichita

Williamson.

482

365

40, 771

164

104

149

264

3,990

168

7,200

5, 862

91, 240

165, 615

Utah.

Salt Lake

Utah

Weber

Unassignable.

Vermont.

3,112

158

10
35
93
20

2 4''1

Bennington.
Chittenden-

90
899

Vermont — Continued.

Orleans ,

Washington

Windham—

Windsor .

107

205

1,103

Virginia 931, 526

Albemarle

Arlington

Bedford

Campbell

Dinwiddle

Frederick

Henrico

Henry

King George

Montgomery

Norfolk

Northumberland-
Pittsylvania

Prince Edward-
Prince George

Prince William..

Roanoke

Smyth

Southampton

Spotsylvania

Warwick-

Washington

Wythe

York

457

217, 665

205

771

781

977

2,289

6,374

17, 192

292, 477

728

414

494

462

114

389, 194

46
565

Washington 584, 834

Clark

Grays Harbor.

King -_

Kitsap

Louis

Pierce

Spokane

Whitman

West Virginia-^

Berkeley

Brooke

Cabell

Hancock

Harrison

Kanawha__.

Marion

Marshall—^

Mason

Mercer

Mineral

MoHdngalia.

Ohio

TayN.r

101

727

377, 738

201.338

3,550

1,328

25, 167

582

4,595

496

3,454

100

8.240

271

1,850

4.781

NATIONAL DEPENSE MIGRATION

6589

Table 1.^ — Coiiniy distribution of War and Navy Department prime contracts
and project orders, June /, W'tO, to June 30, 1941 — AU awards having value of
$10,000 or more excluding construction, construction materials, fuels, food-
stuffs, and serivccs — Continued

[Thousands of dollars]

West Virginia — Continued.

Upshur

Wood

Wisconsin -

Bayfield

Brown

Calumet

Chippewa

Columbia

Dane

Door

Douglas

Eau Claire

Fond Du Lac-

Jefferson

Kenosha

La Crosse

Manitowoc

Marathon

Marinette

30
472

145, 923

1.448

2:-)9

481

100

1,1(39

2,789

2,184

8.167

1. 639

327

33. 352

1, 552

2,691

Wiscon sin — Continued.

Milwaukee

Outgamie

Ozaukee

Pierce

Portage

Racine

Rock

Sauk

Sheboygan

Walworth

Washington

Waukesha

Waupaca

Winnebago

Wood

Unassignable

Wyoming: Natrona.

Off continent

Unassignable

60, 887

386

130

6,653

331

738

739

608

572

,462

42. 952

620, 860

Table 2. — Distributioi of major defense prime contracts awarded by the War
and Navy Departments by States, June 1, 1940, to June 30, 1941

[Thousands of dollars]

Grand total.

13, 083, 483

Continental United States. 12, 180, 450

Alabama

Arizona

Arkansas

California

Colorado

Connecticut

Delaware

District of Columbia-
Florida

Georgia

Idaho

Illinois

Indiana

Iowa

Kansas

Kentucky

Louisiana

Maine

Maryland

Massachusetts

Michigan

Minnesota

Mississippi

Missouri

215, 110

3,460

5,485

1, 335, 186

126, 213

595, 896

8, 085

5,972

118, 085

91, 090

1,251

363, 746

389, 894

68, 857

95, 203

48, 683

34, 602

187, 876

366, 018

715, 636

791, 090

45, 584

72, 910

372, 670

Continental United States — Continued.

Montana 45

Nebraska 14, 489

Nevada 4, 349

New Hampshire 15, 564

New Jersey 1, 424. 915

New Mexico 9, 362

New York 1, 159, 670

North Carolina 90, 597

North Dakota

Ohio

Oklahoma

Oregon

Pennsylvania—.

Rhode Island

South Carolina-
South Dakota-
Tennessee

Texas

Utah

Vermont

Virginia

Washington

West Virginia-
Wisconsin

Wyoming

Off Continent-.
Una ssignable

536, 949

176, 169

51, 053

744, 081

66, 564

56, 284

141

81, 135

433, 577

9,788

5, 879

552, 119

433, 376

98, 661

152, 278

4, 883

72. 298

830, 73.-

6590

WASHINGTON HEARINGS

Table 3. — Distribution of major defense contracts awarded by the War and

Navy Departments, by Federal Reserve District and Industrial Area, June
1, 1940, to June 30, 1941

[Thousands of dollars]

Grand total 13^ 083, 483

Continental United States 12. 109, 470

1. Boston district, total 1, 454, 809

Boston 625,231

Hartford 264,332

Mancliester 6, 238

New Haven-Waterbury 67, 605

New London 126, 210

Newport 7, 196

Pittsfield 11,734

Portland-Bath 172,223

Portsmouth 5,025

Providence-New Bedford-Fall River 32, 379

Springfield-Holyoke 23, 822

Worcester 27, 682

Remainder of district 85, 132

2. New York district, total 2, 131, 596

Albany-Schenectady-Troy 191.817

Binghamton 7,920

Bridgeport 132,944

Buffalo 192.517

Dover 12. 718

Nassau 130,423

Newark-Jersey City . 811, 916

New York City 424, 166

Rochester 66, 755

Syracuse 24,596

Utica 55,498

Remainder of district 80. 326

3. Philadelphia district, total 1, 199, 897

Allentown-Bethlehem 61,159

Bloomsburg 61.275

Camden 565,418

Johnstown 134

Philadelphia 395,837

Reading 9. 580

Seranton-Wilkes-Barre 7. 1">2

Trenton 10.288

Wilmington 7. 318

Williamsport 16.047

York-Harrisburg-Lancaster 42. 303

Remainder of district 23, 391

4. Cleveland district, total 680, 786

Akron 32, 168

Canton 29, 413

Cincinnati 44, 299

Cleveland 197.330

Columbus 23,433

Dayton 40,143

Erie 9, 588

Mansfield 513

Pittsburgh 101,273

Ravenna 75,845

Springfield 4,544

NATIONAL DEFENSE MIGRATION 6591

Table 3.— Distribution of major defense contracts awarded hy the War and
Navy Departments, by Federal Reserve District and hidustrial Area, June
1, W-'/O, to June 30, 1941— Continued

[Thousands of dollars]

Continental United States — Continued.

4. Cleveland district — Continued.

Toledo 28,257

Wheeling 10,983

Youngstown 23, fi42

Remainder of district 59, 355

5. Richmond district, total 1, 164, 718

Alexandria 10,374

Baltimore 299,166

Charleston, S. C IS, 563

Charleston, W. Va 53, 981

Indianhcad 6, 210

Norfolli-Newport News 421, 929

Radford-Pulaski 89,638

Richmond 5, 758

Remainder of district 259, 099

6. Atlanta district, total 558, 553

Atlanta 37,518

Birmingham 12, 710

Chattanooga 16,839

Childersburg 99, 6i3

Knoxville 5,461

Mobile-Pascagoula 101,053

Muscle Slioals-Sheffield 6, 500

Nashville 4,312

New Orleans 11,511

Remainder of district 263, 006

7. Chicago district, total 1, 583, 073

Anderson-lNIuncie 7, 488

Battle Creek 16, 950

Cedar Rapids 3, 268

Chicago 312,731

Detroit 584,614

Des Moines 575

Flint 30, 797

Fort Wayne 3, 540

Grand Rapids 1, 291

Indianapolis 79, 128

Manitowac 34,642

Milwaukee 73,052

Muskegon 47,646

Peoria 1, 231

Rockford 24,684

Rock Island 4, 643

Saginaw-Bay City 41, 893

South Bend-La Porte 127, 837

Waterloo 143

Remainder of district 186. 920

8. St. Louis district, total 572, .507

Evansville 1, 829

Louisville 169, 885

Memphis 4, 739

Milan 47,675

St. Louis 260, 794

Remainder of district 87, 585

60396— 41— pt. 16—19

6592

WASHINGTON HEARINGS

Table 3. — Distribution of major defense contracts aioarded hy the War and
Navy Departments, by Federal Reserve District and Industrial Area, June
1, 19.'i0, to June 30, 1 9. il— Continued

[Thousands of dollars]

Continental United States — Continued.

9. Minneapolis district, total 51, 391

Minneapolis-St. Paul 44, 278

Remainder of district 7,113

10. Kansas City district, total 439, 152

Denver 121, 591

Kansas City 46, 205

Omalia 13, 308

Wichita 81, 081

Remainder of district 176. 967

11. Dallas district, total 436,455

Dallas-Fort Worth 218, 617

Houston 18, 449

Orange-Port Arthur-Beaumont 105, 533

Remainder of district 93, 856

12. San Francisco district, total 1,836,533

Bellingham 1, 408

Bremerton 4, 671

Los Angeles 6.51, 244

Portland 38, 044

Salt Lake City 1,075

San Diego 259,542

San Francisco-Oakland 348, 720

San Jose 10, 273

Seattle-Takoma 422, 567

Vallejo 16,680

Remainder of district - 82, 309

Off continent 72, 352

Unassignable 901, 631

Table 4. — Percentage distribution of prime contracts and Government financed
facilities by regions as of June SO, lOJfl

Region

Percent-
age of
manufac-
turing

workers

Percent-
age of
value of
manufac-
tured
products

Percentage of value
of prime contracts

Percentage of esti-
mated cost of
Government-
financed facilities
(May 31, 1941)

War De-
partment
only

War and
Navy De-
partments

W^ar De-
partment
only

W^ar and
Navy De-
partments

United States _

100.0

New England

12.1
28.6
27.8

4.8
12.6

4.6

3.4
.7

5.4

8.6
28.2
30.8

9.5
3.5
4.6

i..";

6.6

6.0
22.5
27.2
8.2
8.9
4.7
7.8
2 4
12.3

12.9
27.3
18.4
5.0
11.3
3.5
5.4
1.2
15.0

2.5
7.3
40.5
15.3
12.9

n.o

4.8
3.1
2.4

6.7

Middle Atlantic

19.1

32.8

8.2

South Atlantic

12.6

East South Central

8.5

3.9

1.5

Pacific

6.4

NATIONAL DEFENSE MIGRATION

6593

Table 5. — Regional distribution of value of manufactured products, value of
War and Navy Department prime contracts, and estimated cost of Govervr

ment-financed facilities

Value of
manu-
factured
products 1

Value of

War and

Navy

prime

contracts '

Estimated
cost of
Govern-
ment-
financed
facilities »

Percent
100.0

New T'rglftnd

8.6

12.9

6 7

2.2
.6

4.3
.4
.9
.2

4.9
1.5
S.9
.1
.5
(<)

3 0

Maine

2.6

New Hampshire ... -. .

Rhode Island

Middle Atlantic

28.2

27.3

19 1

New Jersey .. .

6.0
12.6
9.6

11.7
9.5
6.1

2 9

New York

7 9

8.3

East North Central

30.8

18.4

32 8

Illinois. ... .

8.4
3.9
7.6
8.1
2.8

3.0
3.2
6.5
4.4
1.3

6.8

Indiana

9 0

7.3

Ohio . ....

9.2

Wisconsin

West North Central

6.8

5.0

8.2

1.3

1.5
2.5
.5
.1
.1

.6
.8
.4
3.1
.1

Kansas

Minnesota

5.5

Nebraska

North Dakota

{*)

South Atlantic

9.5

11.3

12.6

.2
.1
.4

\.i

2.5
.7

1.8
.8

1.0
.7
3.0

.7
.5
4.5

(•)

District of Columbia

Florida

Maryland

2.6

Virginia

5.3

W'est Virginia

3.4

East South Central

3.5

8.5

1.0
.9
.3

1.3

1.8
.4
.6

4.5

Kentucky

1.3

MississiDpi

2.6

West South Central

4.5

5.4

3 9

-Arkansas .

.3
1.0

.5
2.7

<".3
1.5
3.6

Louisiana

(4)

Oklahoma

3.2

Mountain

1.5

1.2

1 5

Arizona .

■\

0)
1.0

Colorado

1.3

1 Census of Manufactures, 1939.

' Contracts awarded from June 1, 1940, through June 30, 1941.

3 Commitments of War and Navy Departments, defense prime contracts and Reconstruction Finance
Corporation, through May 31, 1941.

4 Less than 0.05 percent.

g594 WASHINGTON HEARINGS

Table 5. — Regimxal distriMtion of value of mamifactured products, value of
War and Navy Department prime contracts, and estimated cost of Govern-
financial facilities — Continued

Value of
manu-
factured
products

Value of

War and

Navy

prime

contracts

Estimated
cost of
Govern-
ment-
financed
facilities

Continental United States— Continued.
Mountain— Continued.
Idaho

Percent
0.2
.3
(')
(<)
.3

Percent

(')
(')
W
0.1

(*)

Percent

Nevada

New Mexico

Utah

Wyoming

6.6

15.0

California

4.9
.6
1.1

11.0
.4
3.6

4 6

Washington - . . .

1.7

■ Undistributed

* Less than 0.05 percent.

Table 6. — Regional distribution of manufacturing employment, value of War
and Navy Department prime contracts, and estimated cost of Government-
financed facilities

Manufac-
turine em-
ployment 1

Value of

War and

Navy

prime

contracts "

Estimated
cost of
Govern-
ment-
financed
facilities 8

Percent
100.0

Percent

12.1

12.9

6.7

3.0
LO
5.8

.7
L3

4.9
1.5
5.9
.1
.5

3 0

Maine

Massachusetts -- .-....._ .

2.6

Middle Atlantic

28.6

27.3

19.1

^.5
12.2
10.9

11.7
9.5
6.1

2 9

7.9

Pennsylvania - -.-

8.3

27.8

18.4

32.8

Illinois

7.6
3.5
6.6
7.6
2.5

3.0
3.2
6.5
4.4
1.3

6 8

9.0

7.3

Ohio

9.2

West North Central - -

4.8

5.0

8.2

.8
.4
1.0
2.3
.2

.6
.8
.4
3.1
.1

1.4

Kansas - .

5.5

Nebraska

North Dakota

' Census of Manufactures, 1939.

* Contracts awarded from June 1, 1940, through June 30, 1941.

3 Commitments of War and Navy Departments, Defense Plant Corporation and Reconstruction Finance
Corporation through May 31, 1941.

NATIONAL DEFENSE MIGRATION

6595

Table 6. — Regional distribution of manufacturing employment, value of War
and Navu Department prime contracts, and estimated cost of Qovernment-
financed facilities — Continued

Manufac-
turins; em-
ployment

Value of

War and

Navy

prime

contracts

Estimated
cost of
Govern-
ment-
financed
facilities

South Atlantic - - -

Percent
12.6

Percent
11.3

Percent
12.6

.3
.1
.7
2.0
1.8
3.4
1.6
1.7
1.0

1.0
.7

3.0
.7
.5

4.5
.8

(*)

District of Columbia -

2.6

Vireinii -

5.3

West Virginia-.- - — -

3.4

East South Central -

4.6

3.5

8.5

1.5

.8
.6
1.7

1.8
.4
.6
.7

4.5

1.3

Mississippi - -

Tennessee

2.6

3.4

5.4

3.9

A k

.5
.9
.4
1.6

'".3
1.5
3.6

{*)

Oklahoma

Texas

3.2

Mountain -

1.2

1.5

-•3
!l

1.0

(*)

1.3

Utah

Wyoming

Pacific

5.4

15.0

6.4

California -- -

3.5
.8
1.1

11.0
.4
3.6

4.6

Washington

1.7

Undistributed

* Less than 0.05 percent.

Table 7. — War Department regional distribution of value of prime contracts
and estimated cost of Government-oicned facilities

Regions by States

Value of

prime
contracts'

Estimated

cost of
facilities '

Regions by States

Value of

prime
contracts

Estimated
cost of
facilities

Percent
100.0

Percent
22.5

Percent
7.3

6.0

2.5

7.0
9.8
5.7

New York

4.2

Connecticut.-

3.1
.1

2.1
.2
.4
.1

Pennsylvania

2.3

Maine

East North Central

27.2

—

Mai^sachusetts

1.0

40.5

Illinois

'".2

4.5
5.9
10.6

9.2

Indiana

14.8

Michigan

7.2

' Prime contracts are those of $10,000 and over awarded since June 1, 1940. Estimated cost of Govern-
ment-financed facilities includes War and Navy Departments, Reconstruction Finance and Defense Plant
Corporations, as well as project orders of $25,000 and over.

' Through May 31, 1941.

3 Less than 0.05 percent.

6596

WASHINGTON HEARINGS

Table 7. — War Department regional distribution of value of prime contracts
and estimated cost of Government-owned facilities — Continued

Regions by States

Value of

prime
contracts

Estimated
cost of
facilities

Regions by States

Value of

prime

contracts

Estimated

cost of
facilities

East North Central— Con.
Ohio

Percent

5.2
1.0

Percent

9.2
.1

East South Central— Con.
Mississippi

Percent

.3
1.2

Percent

2.5

West South Central.

XVost 'Mfirfh Cpntral

8.2

15.3

7.8

4.8

Arkansas .-

Louisiana

Iowa

1.0
1.4

.2
5.4

2.8
1.0

2.7
4.5

T7-„ „o_

Oklahoma

1.6

10.6
.9

3.2

Mountain . . -

North Dakota

2.4

3.1

(')

.1
1.9

(»)

Rnnth Atlantip

8.9

12.9

Colorado . . .

2.8

T> la ware

'".3
1.2
3.3
1.1

.5
1.9

Montana.-

District of Columbia

Nevada

.1
.2
.1

I2T

Utah

4.5

Wyoming

Pacific

South Carolina

2.4

6.2
2.2

California

9.5
.2
2.6

1.6

Oregon

TToof Rnnth Cpntral

4.7

11.0

Washington

2.5
.6

7.0
5.1

Kentucky

• Less than 0.05 percent.

Table 8. — Cumulative percentage distribution of prime contracts and Govern^
ment-financed facilities, by regions *

Region

Through

Oct. 31,

1940

Through

Mar. 31,

1941

Through

June 30,

1941

Percent
100.0

New England:

16.9
5.5

25.8
24.1

14.7
33.6

2.9
4.0

15.1
19.9

L6
L7

2.9
L7

13.8
6.9

27.2
20.6

17.4
34.0

5.1
6.8

12.1
10.2

3.3

9.3

2.4
4.1

1.4
1.6

17.3
6.5

12 9

Fpcilities

«6.7

Middle Atlantic:

27.3

»19. 1

East North Central:

18.4

Facilities -

»32.8

West North Central:

5.0

Facilitips . -

'8.2

South Atlantic:

n.3

Facilities . .-

'12.6

East South Central:

3.6

Facilities

'8.6

West South Central:

5.4

Facilities - -

»3.9

Mountain:

Facilities

U.6

Pacific:

20.1
9.5

15.0

Facilities

>6.4

» Prime contracts are those of $10,000 and over awarded since June 1, 1940. Estimated cost of Govern-
ment-financed facilities includes War and Navy Departments, Reconstruction Finance and Defense Plant
Corporations as well as project orders of $25,000 and over.

« Through May 31, 1941.

NATIONAL DEFENSE MIGRATION

6597

REGIONAL DISTRIBUTION OF THE ESTIMATED COST OF NEW

INDUSTRIAL FACILITIES FINANCED BY WAR DEPARTMENT FUNDS

AND TOTAL VALUE OF MANUFACTURED PRODUCT

NEW ENGLAND

MIDDLE ATLANTIC

EAST NORTH CENTRAL

WEST NORTH CENTRAL

SOUTH ATLANTIC

EAST SOUTH CENTRAL

WEST SOUTH CENTRAL

iEstcmolei Cost of Wor Oeportmeni rocllil
Comm.lmenis of Wor OeporlirenI FuniJs U
through Mo, 31, 1941 . Includes Wor Oepor
OefonM PlonI Corporolioa

Chaet I

6598

WASHINGTON HEARINGS

NAVY DEPARTMENT

REGIONAL DISTRIBUTION OF THE ESTIMATED COST

OF NEW INDUSTRIAL FACILITIES AND TOTAL VALUE

OF MANUFACTURED PRODUCT

NEW ENGLAND

MIDDLE ATLANTIC

EAST NORTH CENTRAL

WEST NORTH CENTRAL

SOUTH ATLANTIC

EAST SOUTH CENTRAL

WEST SOUTH CENTRAL

Eslimoted Cos) of Novy Department Facilities
Commitments of t^ovy Deportment Funds from June I, I940,
throuqti fWloy 31, 1941. Includes Navy Deportment shore of
Defense Plont Corporation

Chaet II

NATIONAL DEFENSE MIGRATION

6599

NAVY DEPARTMENT

REGIONAL DISTRIBUTION OF PRIME CONTRACT AWARDS

AND TOTAL VALUE OF MANUFACTURED PRODUCTS

NEW ENGLAND

MDOLE ATLANTIC

EAST NORTH CENTRAL

WEST NORTH CENTRAL

SOUTH ATLANTIC

EAST SOUTH CENTRAL

WEST SOUTH CENTRAL

PER CENT
40

June I, 1940 IKrough Jun« 10,

Chart III

6600

WASHINGTON HEARINGS

NAVY DEPARTMENT

REGIONAL DISTRIBUTION OF PRIME CONTRACT AWARDS

AND TOTAL VALUE OF MANUFACTURED PRODUCT

EXCLUDING AIRCRAFT CONTRACTS

NEW ENGLAND

MIDDLE ATLANTIC

CAST NORTH CENTRAL

WEST NORTH CENTRAL

SOOTH ATLANTIC

CAST SOUTH CENTRAL

WEST SOUTH CENTRAL

Tolol Volu* of Mai>uloclur»4 Product
Coniut of MomifoOurat lor 1939

Novy Prim* Conlrocit
Prima CootrocU 0» $I0,(

(rom June 1, 1940 Ihroujh Juna 50,1

Chart IV

NATIONAL DEFENSE MIGRATION

6601

WAR DEPARTMENT

REGIONAL DISTRIBUTION OF PRIME CONTRACT AWARDS

AND TOTAL VALUE OF MANUFACTURED PRODUCTS

INCLUDING filRCRAFT CONTRaCTS

NEW ENGLAND

ilODLE ATLANTIC

EAST NORTH CENTRAL

WEST NORTH CENTRAL -

SOUTH ATLANTIC

EAST SOUTH CENTRAL

WEST SOUTH CENTRAL

PER CENT
30 40

□ Army Prime Contfocts
Prim« Conlroctg of S lOOOO or More 4«ocde(i Iron Jun

Chaet V

through June 30,

6602

WASHINGTON HEARINGS

WAR DEPARTMENT

REGIONAL DISTRIBUTION OF PRIME CONTRACT AWARDS

AND TOTAL VALUE OF MANUFACTURED PRODUCTS

EXCLUDING aiRCRflFT CONTRACTS

NEW ENGLAND

MIDDLE ATLANTIC

EAST NORTH CENTR/

WEST NORTH CENTRi

SOUTH ATLANTIC

EAST SOUTH CENTRAL

WEST SOUTH CENTRAL

iem

r~n &,„, P„me CoMrocts

I I Pome Conirocis of 1 10,000 0' More i

Chart VI

1940 Ihrough Junt 30. 1941

NATTOAAL DEFENSE MIGKATION 6603

Exhibit 1

Regulation No. 6, Establishing a Plant Site Board in the Office of Produc-
tion Management and Defining Procedure for Clearance of the Proposed
Location of New or Additionae Plants and Facilities Required for the
National Defense

Whereas Executive Order No. 8629, dated January 7, 1941, created the Office
of Production Management and charged it with certain duties, among others,
pertaining to the formulation and execution of all measures needful or appro-
priate in order to increase, accelerate or regulate the provision of emergency
plant or facilities requii'ed for the national defense, and the stimulation and
planning of the creation of additional facilities and sources of production and
supply ; and

Whereas said Executive order charged the Office of Production Management
with the duty of insuring effective coordination of those activities of the several
departments, corporations, and other agencies of the Government which are
directly concerned with the provision of emergency plant facilities required for
the national defense ; and

Whereas the Office of Production Management has heretofore, by its Regula-
tion No. 2, promulgated March 7, 1941, vested in the Director of Purchases
respons bility for the clearance, prior to award, of all major proposals for the
purchase or construction by the War Department or the Navy Department of
materials, articles or equipment needed for defense ;

Now therefore, by virtue of the authority vested in the Office of Production
Management by said Executive order, it is hereby ordered that :

(1) There is hereby established in the Division of Purchases a Plant Site
Board, hereinafter referred to as the Board, consisting of five members, one
of whom shall be Chairman. Three members of such Board shall constitute a
quorum. The Director General, acting in association with the Associate Director
General, shall appoint the members and designate the Chairman.

(2) Whenever the Secretary of War, the Secretary of the Navy, or the Re-
construction Finance Corporation or any subsidiary thereof ijroposes to undertake
or to contract for the construction or installation of any substantial plant or
facility or the expasion in a substantial measure of any plant or facility re-
quired for the national defense, or to make any loan or to iiurchase securities
in order to finance such construction, expansion or installation, the Board shall
review the proposed location of such plant or facility for clearance as hereinafter
provided.

(3) The Board is authorized to enter into arrangements with any other depart-
ment, corporation, or agency of the Government for the submission to it for clear-
ance of the proposed location of any plant or facility required for the national
defense, the construction, expansion, or installation of which such department,
corporation, or agency proposes to undertake, contract for, or finance by making
loans or purchasing securities. Any such arrangement shall relate only to the
construction or installation of substantial plants or facilities, or the expansion in
a substantial measure of a plant or facility.

(4) If any division, bureau, office, or officer of the Office of Production Man-
agement shall make any recommendation to the War Department, the Navy De-
partment, or any other department, corporation, or agency of the Government
with respect to the proposed location of any plant or facility required for the
national defense, written notice of such recommendation shall immediately be
given to the Board by such division, bureau, office, or officer.

(5) In reviewing for clearance the proposed location of any such plant or
facility, the Board shall seek, insofar as it can do so consistently with due expedi-
tion of the program of defense production and appropriate factors of military
strategy, to facilitate the geographic decentralization of defense industry and the
full employment of all available labor and facilities.

(6) The Board .shall seek to work in close cooperation with representatives
of each such department, corporation, or agency from the outset of the process

QgQ4 WASHINGTON HEARINGS

of selection of the location of any such plant or facility. Any proposal which
the Board disapproves shall, if such department, corporation, or agency so re-
quests, be referred to the Council for final decision.

(7) Nothing herein shall be deemed to apply to (A) any proposal of the Sec-
retary of War, or of any other department, corporation, or agency of the Govern-
ment, to undertake or contract for the construction, expansion, or installation of
any plant or facility required for defense with funds appropriated under any
act which conditions the expenditure of such funds upon the recommendation of
the Advisory Commission to the Council of National Defense (but the Director
of Purchases shall serve as the liaison and channel of communication between
the War Department or such other department, corporation, or agency and the
Advisory Commission to the Couoncil of National Defense with respect to any
such proposal), nor to (B) any construction within or addition to any existing
navy yard or naval reservation.

(8)' The term "substantial," as used herein, shall be defined from time to time
by the Council of the Office of Production Management upon the recommendation
of the Board. The Board, after consultation with representatives of the de-
partment, corporation, or agency affected, shall from time to time recommend
such definition as it deems appropriate.

(9) The Board, through its chairman, shall make such regular or special reports
as may from time to time be required by the Council.

(10) The Board shall supersede the Plant Site Committee authorized by the
Council of March 17, 1941. Subject to the provisions of this regulation, the Board
shall assume the duties and functions and continue the work of said committee.

Wm. KNxn)SEN,

Director General.
Sidney Hillman,
Associate Director General.
Henry L. Stimson,

Secretary of War.
Frank Knox,
Secretary of the Navy.

Approved :
Attest :
May 6, 1941.

John Lord O'Bbian,

General Counsel.

Hebbert Emmerich,

Secretary.

Exhibit 2

July 2, 1941.

Regulation No. 6-A, Amending Regulation No. 6, Dated May 6, 1941, "Estab-
lishing A Plant Site Board in the Office of Production Management and
Defining Procedure for Clf-arance of the Proposed Location of New or
Additional Plants and Facilities Required for the National Defense"

The following paragraph should be inserted after paragraph (4) of Regulation
No. 6:

(4A) If any division, bureau, office, or officer of the Office of Production Man-
agement proposes to make any recommendation to the War Department, the Navy
Department, or any other department, corporation, or agency of the Government
with respect to the construction or installation of any substantial plant or facility
or the expansion in a substantial measure of any plant or facility required for
the national defense, written notice of such proposed recommendation shall be
given by such division, bureau, office, or officer to the Plant Site Board, and also
to the Director of Purchases if such construction, installation or expansion in-
volves a roconimended estimated expenditure of $500,000 or more ; and original
evidence of the approval and clearance of such project by the Board, together
with the data submitted to and considered by the Board, and original evidence
of the approval and clearance of the proposal by the Director of Purchases in
appropriate cases, shall accompany the recommendation to the War Department,

NATIONAL DEFENSE MIGRATION 6605

Navy Department, or any other department, corporation, or agency of the
Government.

William S. Knudsen,

Director General.
Sidney Hillman,
Associate Director General.
Henry L. Stimson,

Secretary of War.
Frank Knox,

Secretary of the Navy.
Approved :

John Lobd O'Beian,

General Counsel.
Attest :

Hebbeet Emmerich,

Secretary.

TESTIMONY OF DONALD M. NELSON— Resumed

The Chairman. Now, I would like to quote from your statement the
following :

One disturbing effect, both immediately and for the long run, would be a large
and disorderly migration of labor. Consequently the Division of Purchases has
consistently sought to advise the placing of defense orders in such places and in
such manner as to cause a minimum of labor migration.

Mr. Nelson. That is right.

The Chairman. That is right down our alley. That is what we are
very much interested in. I just want to let you know that we desire
to get all the information we possibly can on migration to defense
centers, and we welcome you here, Mr. Nelson. Congressman Curtis
will ask you a few general questions.

Mr. Nelson. All right, sir.

Mr. Curtis. Mr. Nelson, your home, I believe, is in Kansas City?

Mr. Nelson. No, sir; my home is in Chicago. I was born in
Hannibal, Mo. I went to school at the University of Missouri, at
Columbia, Mo.

The Chairman. "V^liat year was that?

Mr. Nelson. I went to school there in 1907 to 1911. I graduated
in 1911.

Mr. Curtis. When did you join the Office of Production Manage-
ment ?

Mr. Nelson. Just a year ago.

Mr. Curtis. Prior to that time what was your business?

Mr. Nelson. I was with Sears, Roebuck & Co., executive vice presi-
dent of Sears, Roebuck & Co., in Chicago.

Mr. Curtis. Mr. Nelson, will you discuss the ways in which the
Division of Purchases of the Office of Production Management seeks
to keep labor migration at a minimum?

Mr. Nel'^on. Yes, sir ; although that will be a long story, sir.

Mr. Curtis. I realize your whole paper is on that subject, but just
touch on some of the highlights as they appear to you.

Mr. Nelson. Let me touch on a few of the highlights because to me
that is one of the most important single things before us.

I have felt, of course, in our defense program, that our primary
responsibility is to get goods as quickly as possible — as quickly as the

QQQQ WASHINGTON HEAiUNUS

Army needs them and consistent with all of that the background of
our purchasing should be that of trying to prevent undue migi-ation of
workers. I feel that it would be perfectly possible to win a war or
lose it through economic dislocation in the United States. It might
shatter our whole economy after this tremendous defense program
is over, and in every way conceivable, by every knowledge of pur-
chasing, which I have, I have tried to help advise the Army to do
those things which would prevent undue migration.

CHANGED "f. O. B. DEPOt" TO 't. O. B. PLANT"

I will only give you a very few small things at first and then we
will move up to the bigger ones. When I came down here I found
that in the purchase of clothing and, as a matter of fact, most quarter-
master supplies, they were being quoted f. o. b. depot. We got the
Army to agree to change that to f. o. b. plant, with the thought that
by doing that we would get a wider diseribution of business over the
United States, and that immediately resulted.

In clothing, pants, overcoats — not so much overcoats because they
are primarily made in New York City, but in pants, shirts, and many
things of that kind they are being produced now all over the United
States, instead of just in a small area around the depot.

In other words if these orders had all been placed with the con-
cerns immediately adjacent to the depot, who had a freight advantage
and by that reason would have been able to expand their businesses,
they would have drawn in workers from all over the United States
and you would have gotten a much greater migration than you have
at present,

I merely give that as an example of one thing.

Mr. Curtis. But in caring for these groups you feel you would have
spent much greater sums than the Government might have had to pay
because of additional freight charges?

Mr. Nelson. No, sir; I believe it has been possible to do this without
the payment of extra money, because these goods are used at various
places around the United States.

It included establishing new depots and new distribution points so
the Government didn't lose money. As a matter of fact it actually
saved money.

What has happened is that a large number of new facilities have
been trained to make Government mei-chandise, so that in case there
is much greater haste necessary we would be able to procure larger
quantities much quicker than if only a few concerns got this business.

Now, I merely cite that as example of one little thing, perhaps,
which I think has had a big effect.

SCOPE or O. p. M. PURCHASING DIVISION

Mr. Curtis. May I interrupt and ask in the particular branch that
you have charge of. do you purchase everything there?

Mr. Nei.son. Well, sir, we do no purchasing ourselves. Ours is an
advisory function.

Mr. Curtis. I mean, do you supervise the purchasing of all articles?

Mr. Nelson. Our executive order covers everything, but in actual
practice the Division of Production covers many items where produc-
tion is much more important than purchasing.

NATIONAL DEFENSE xMIGRATION 6607

For example, if you are buying 155-incli gun mounts there
are only a very few concerns that coukl make them. The arrangement
for production of that kind is much more important than the actual
purchasing.

Our Office, however, clears all contracts over $500,000. All of them
come through our office — are seen by us — and anything in connection
with them may be taken up with any division of the O. P. M., as well
as any division of the Army or the Navy, with the idea of trying
to get, so far as we can, greater distribution of these orders, greater
distribution of plant facilities throughout the United States, both
Government -owned and those financed by industry.

Now, I would like to point out, sir, that every purchase is a com-
promise. We have to get these things quickly. We want to get them
when we want them. Therefore, in many cases you must do the ex-
pedient thing, rather than the wise thing, and in each case there is
that compromise and it requires fine shades of judgment as to whether
it is better to place business with concerns that are now equipped to
make it or to build a new concern to do it.

Take for example, the aircraft industry. Now. certainly, from
the standpoint of migration of workers, from the standpoint of
strategic location, it is wrong to manufacture airplanes on the
two coasts. But still the primary object is to get airplanes and get
them rapidly.

Therefore, we had to place business and had to spend millions of
dollars expanding plants in locations that we knew would cause migra-
tion, as the Congressmen are aware — San Diego, Los Angeles, Balti-
more, and other places.

We just had to get airplanes quickly and, therefore, each decision is
a compromise which requires fine shades of judgment.

DISLOCATION OF MEN AND SKILLS

But I can say to you, sir, that from the standpoint of the Division
of Purchases, and, I believe, from the rest of O. P. M., we have con-
stantly had our minds on this subject which you are now investigating,
realizing that there would be a relief problem after this is all over
that might destroy our whole economy, if too great dislocation of
workers occurred. If you had migrations from centers of the United
States to the present industrial areas, you would in a sense create
an economic desert in certain parts of the United States, if you
didn't do everything you could to trj- to take business to the workers
rather than taking the workers to the business.

Mr. Curtis. And it is entirely possible to drain certain areas of cer-
tain needed skills, too, is it not?

]\Ir. Nelson. Yes, sir ; and the thing that worries me more than any-
thing else about it is that when the skilled worker moves out the
machine that he formerly operated is no longer of any value because
there are no skilled workers. Then you move the machinery out and
when that is done permanent dislocation has occurred, which probably
never will be remedied or probably will be remedied only after a
long period of time.

Mr. CrRTis. Is it also your opinion that when this defense etfort is
over and millions are out of jobs, defense jobs, that those people are
better off if they are at home or near home, where they know the ins

60396— 41— pt. 16 20

gg08 WASHINGTON HEARINGS

and outs of business better and where they are among their friends
and families?

Mr. Nelson. Unquestionably, sir, if only from the standpoint of
dollars and cents. I know from experience. Take a State like Mis-
souri. The workers in those small towns own their own small homes.
They have a garden or their neighbors have a garden ; they have a cow
or the neighbors have a cow and they are able, in periods of stress, to
take care of themselves without the expenditure of large amounts of
money on the part of the Government.

Move those people into a large city and then you have to provide
them, in addition to all of their sustenance, their rent as well. The
relief burden after this thing is all over would be perfectly tremen-
dous if we didn't pay attention to this subject of preventing, insofar
as possible, these migrations — these large migrations of workers from
their homes to present industrial centers.

Mr. Curtis. I have in mind a letter that I received from a school
superintendent in one of my cities, pointing out that very thing. The
angle that he mentioned was that that whole territory — and he lives
in a town of about 18,000 people — is being drained of all its young
people, and that it has already been shown that the average age of
the people living in that area, according to the letter, is much greater
than it was 2 or 3 years ago.

Mr. Nelson. Yes, sir.

Mr. CtJRTis. Wliich. of course, is going to lead to complications where
in certain States or certain localities in a few years from now everyone
living there will be old people and children and the productive people
have gone to other places.

REQUIREMENTS OF AIRCRAFT MANUFACTURE

Mr. Nelson. It certainly will, sir: but that is the thing that has
been very difficult to prevent, because the aircraft industry requires
very large concentrations of young people who can become prohcient
in a short space of time. As you go through the aircraft factories on
the coast, which I did last w^eek, you are impressed with the large
numbers of young people who have moved into those areas.

Now, it isn't possible to make aircraft except in large plants. It just
isn't possible to create aircraft factories in many parts of the country.
I think if you will notice the pattern of the placing of these aircraft
plants you will find that rhey have attempted to put plants in places
like Omaha, Kansas City, Tulsa, Fort Worth, Dallas, with
the thought that eventually, as those plants begin to grow, they will
begin to take care of at least part of the migration.

Sir. Curtis. I understand that the Glenn L. Martin Co. subcontracts
about 60 percent of the material that goes into some of their products.

Mr. Nelson. It is not quite that much, as far as I know. It may
be somewhere close to that.

Mr. Curtis. That is what Mr. Martin testified at the Baltimore
hearing.

Mr. Nelson. It was? I am glad to hear it is as much as 60 percent
because certainly by subcontracting you can prevent a part of this
]nigration. Instead of putting up all the machinery to make every-
thing, if you can place orders for that in spots where the machinery
is now located and help train and teach those small manufacturing

NATIONAL DEFENSE MIGRATION 6609

plants to do part of the job, you will go a long way toward prevent-
ing, in my opinion, the extreme and disastrous result that might come
through the fact that we just had to build larger plants in both coast
areas.

SMALLER BUSINESS ACTIVITIES

Mr. CuKTis. It has been my observation that there are a number of
very small towns and cities that have some fairly well equipped shops.
It would take some time to make the adjustment, but I believe in
due time they can very efficiently produce certain parts of airplanes
and parts for other products.

Mr. Nelson. It is my belief that we haven't done nearly enough to
bring that type of manufacture into the picture.

While I was with the National Defense Commission I created an
organization which we called smaller business activities with the
thought of working toward that very thing. That has been enlarged
and amplified now in the Contract Service Division, which is under the
Production Division of O. P. M. I know that the organization is
being set up to do that and more of it is being done, but I still feel
that it is slower than it need be.

Mr. Curtis. How is the work of the Division of Purchases tied in
with the work of the Plant Site Board?

Mr. Nelson. Well, sir, in this way : I as Director of the Division of
Purchases am also the chairman of the Plant Site Board. That is how
it is tied in now, because we clear all of the contracts.

Mr. Curtis. By "plant site" are you referring just to industrial
sites or does it include Army camps and cantonments ?

Mr. Nelson. No, sir; it does not include Army cantonments, camps,
depots, or supply bases, which are located strictly from a strategic
point of view.

It includes those plants for manufacturing things which the Gov-
ernment wants made.

procedure of plant-site board

Mr. Curtis. Tell us a little bit about the procedure of the Plant
Site Board — how do .you operate?

Mr. Nelson. Well, sir, all expenditures by the Government for more
than $500,000 for the expansion or the building of new facilities, is
cleared by the Plant Site Board. Now, the Plant Site Board consists
of five people. There is Governor Townsend — ex-Governor of In-
diana, Mr. Oliver from the Labor Division of O. P. M., Mr. Johnson
of the Production Division, and Mr. Fuller, who has just resigned
from O. P. M.

Now, this group of five have attempted — not to exercise primarily a
veto power over these plant sites, because that creates delay — in
every instance to work very closely with the different branches of
the Army and Navy who are considering the location of plant sites
so that we may get in on it as early as possible — to give them the
benefits of such advice as we could with respect to one of the very
things you are talking about, the availability of labor.

We have attempted to point out to them certain areas of the United
States where there were large reservoirs of labor, of various kinds of
skills. We have pulled into that all of the statistical branches of the
Government which could get us that information.

QQIQ WASHINGTON HEARINGS

We have attempted to work with them to show them the necessity
for the pushing of tliese plants into the interior of the United States,
particidarly into the West and into the South where this migration
problem is already particularly acute.

A great deal has been done, I believe. Governor Townsend sub-
mitted a map to you showing you, since the Site Board was estab-
lished, the value of these facilities that had been put into the West
and into the Southwest.

In each instance we have gotten good cooperation from all of the
procurement agencies of the Army and the Navy who were dealing
with this problem.

They were not required to submit them to us until after all of the
planning work had been done, but through cooperation we get into it
in the very early stages, when they are planning it, so we can suggest
certain areas where we believe that plants ought to be located in order
that this problem may be handled as well as possible.

I could go into great detail on it, but I don't believe you want any
more detail than that. But that is the w^ay our Plant Site Board
operated.

READJUSTMENT OF ARMY AND NAVY PROPOSALS

The Army and Navy, in other words, submit their more or less
technical decisions from the standpoint of military necessity, and then
we supplement it with all the various material which we can get on
the availability of workers, the housing — Avhich is another very
important thing to me — for the Government to have to go out and
create tremendous new^ housing facilities when, if you go into certain
areas where there are idle workers the housing is there for them
already, seems like a waste of money.

If you can put a plant where houses exist already you save a
lot of money for the Government, and it has been possible in many
instances to point out to the Army and the Navy all of those factors.

Then again if you take out of production very rich farm land — 20
or 30 thousand acres — to make a j^lant site for an ammunition plant
you have created a little desert out of land formerly productive and
would continue to be productive. It would be taken out of its present
productive status, and a lot of people would lose their present work
and would have to move into new locations.

Now, it has been possible by woi'king with the Army and Navy to
get a readjustment of their ideas about where a plant should be located
sc it would not do that very thing to rich farm land.

Mr. Curtis. I think I mentioned to Governor Townsend yesterday
that I had in mind a city of a little less than 100,000 people and they
made a survey and found that they could house approximately 4,000
additional people and that that available housing was so located that
their school system could absorb the increase without any added plant
facilities. Are surveys of that type valuable to you?

Mr. Nelson. They are very valuable. Any that you get like that if
you will give them to us we like to have them because it will enable us
to make a study of it, and in case expansions are required we point out
those locations.

Now, oftentimes it is not possible to use them even, though you
know they should be located there, because if you are going to set

NATIONAL DEFENSE MIGRATION 6611

lip an aircraft-engine plant you need the very highest degree of
mechanical skill to make aircraft engines.

Well, unless that particular skill is available in the community in
large enough numbers, you will have to bring new people into the
community to suppl}^ the skill, so that that is where this fine question
of judgment that I told you about applies in connection with locations.
But we are anxious to have them, and if you would just give us that
information we would be very glad to have it.

Mr. Curtis. I will be very glad to see that you get it.

Mr. Nelson. We will be glad to have it, to see that that location is
pointed out and considered,

GUIDANCE FOR PRIVATE INDUSTRY

Mr. Curtis. Does the Plant Site Board ever veto a site selected by
the Army ?

Mr. Nelson. Well, as I said we don't like the job of vetoing things.
We have been able to cooperatively work out with them these things
to such an extent that if they know we are against a site, they have
tried to pick another one.

Mr. Curtis. In other words, you have changed their minds some-
times ?

Mr. Nelson. We have, sir. And I have been very happy to see
the degree of cooperation that we have gotten from both the Army
and the Navy in connection with locations which to them appeared,
from the technical side of it, ideal, but which, when all of the factors
are considered, including this subject of migration, the building of
houses and schools, and new facilities, churches, and sewers, has
disadvantages, they have worked with us to help pick the new site.

Mr. Curtis. Does that appl}' to private industry also?

Mr. Nelson. Yes, sir ; to a more or less limited extent.

Now, in the case of Government fimds it is comparatively easy to
do the job, because the Government pays for this plant. In the case
of private industry you have another problem that enters into it,
and that is the question of division of supervision, which is very diffi-
cult to get around.

For example, a plant may be located at Hartford, Conn. They
now have their supervisory force there — management is there. Well,
it might be perfectly logical that that plant ought to be located, we
will say, at Lincoln, Nebr. From all points of view that might be
the ideal town, from the standpoint of skills and other things. Well,
that management would have to travel so far and dilute itself so
much that a great delay would occur in getting started, and if it is
important that that particular thing be made very quickh^ we haven't
been able '^o move those to the distances that we would like to on
account of that division of supervision.

That has been one of the most important single things that we have
had to consider in connection with these individual plant sites.

]\Ir. Curtis. The earlier that you undertake to work with the Army
or the Navy on any particular problem the greater good you can do?

Mr. Nelson. Without any question ; there is no doubt about that
and that is why we have attempted, as I say, instead of exercising a
veto right, to go to them at their earliest indication, before they even

5512 WASHINGTON HEARINGS

have the funds or are only thinking of getting the funds. We can
point out at a very early stage the advantages or disadvantages as
we see them, of that particular site, from the standpoint of the very
problems you are studying.

PROSPECTIVE UNEMPLOYMENT IN NONDEFENSE INDUSTRIES

Mr. Curtis. Is it possible to estimate, approximately, the volume
of unemployment which may be expected to materialize in the non-
defense production due to priorities, shortages, and agreements such
as in the automobile industry?

Mr. Nelson. No, sir. You can make some approximations but they
have to be founded on conclusions which take a lot of theory.

Now, we would have to, before locating a new plant site in Detroit
at the present time, try to estimate as best we could what the disloca-
tion was going to be to the automobile industry.

Now, we would assume, for example, that it was going to be as much
as 50 percent — not because we wanted it to be 50 percent, but because
that seemed probable, from the standpoint of the availability of
materials and such things in the Detroit area. We actually used a
figure of somewhere around 50 percent reduction in the automobile
industry in Detroit, to calculate what the unemployment would be
as a result of that, to take up the slack in the new industryy to go in
there.

Now, we have done that in various spots, but we haven't done it for
the United States as a whole because it involves some assumptions
that we feel are premature.

Mr. Curtis. Do you believe that this factor is a persuasive reason
for placing contracts in the already concentrated industrial areas?

Mr. Nelson. I think it may be, sir, if, for instance, you know that
that industrial area is making products that are going to be curtailed.
I feel that you should take that into account insofar as you possibly
can.

Mr. Curtis. But the chances are that already that same community
has some other firms that are on the program of expansion.

Mr. Nelson. That also has to be taken into consideration. In
other words, that is again where this fine line of judgment occurs.
You have that very fact existing — tremendous expansions, we will
say, in defense areas.

Now, if that expansion alone will take up the probable decrease in
employment as a result of priorities and restrictions, it would be
illogical to locate other plants there.

POWER AS A FACTOR IN PLANT LOCATION

Another factor that has to be carefully considered is the power
factor in a location. We don't want to keep adding facilities and
overtaxing the present power facilities of an area.

Mr. Curtis. You are referring to electrical power ?

Mr. Nelson. Electrical power; yes, sir.
^ Mr. Curtis. The other day Mr. Hillman said there were 2.7 mil-
lion workers engaged in defense manufacturing today. Do you
believe that the addition of this number within the last year or so
has already caused a general labor shortage or is the labor shortage
localized ?

NATIONAL DEFENSE MIGRATION 6Q1S

Mr. Nelson. It is localized, sir. It is not general. There are labor
shortages of particular kinds of skills in places, but I think that the
training program that has gone right along hand in hand from the
start has been a very smart thing, in helping prevent those labor
shortages of certain skills.

Mr. Curtis. Mr. Nelson, I, as one member of the committee, am
very glad you could be here. I am very pleased with the approach
your division has made to this matter.

That is all, Mr. Chairman.

The Chairman. Congressman Arnold.

MANUFACTURE OF CLOTHING FOR THE ARMY

Mr. Arnold. I was interested in your statement, Mr. Nelson, that
the manufacture of clothing for the Army has been spread over the
country. Has that spread been pretty general ?

Mr. Nelson. Yes, sir. I would like to show you those figures. I
would be glad to show you a map of how that spread has occurred,
sir, even into a State like Texas that formerly had made very little
clothing for the Army — probably never had made any before — ^but
is now making things like pants and shirts for the Army.

That is also true of mattresses and it is true of many things that
the quartermaster buys.

Mr. Arnold. I am sure the committee will be very interested in
having those figures.

Mr. Nelson. I shall be very glad to give them to you.

Mr. Arnold. Are those manufactured articles that were formerly
manufactured in the East for the most part?

Mr. Nelson. For the most part that has been done right around
Philadelphia. If you will look at the peacetime buying, which, of
course, was relatively small, you will find that most of it occurred
right around the Philadelphia depots.

These concerns in the Middle West and in the South and Southwest
had done very little Government business before.

Mr. Arnold. Do they have as efficient plants as they have in the
East?

Mr. Nelson. In my opinion, sir, just as efficient and in many
cases more efficient.

Mr. Arnold. Is anything being done to increase the efficiency of
those plants throughout the country — any coordinated effort being
made to bring up their efficiency ?

Mr. Nelson. Well, of course, the very fact of giving business to
them and giving them the benefit of Government inspection helps
to increase their efficiency. In other words, efficiency usually comes
in the clothing industry from a repetition of the operation.

TIME and quality ARE MAIN SPECIFICATIONS

Now, the two things that force efficiency are, first, the require-
ment that they produce whatever they take by a certain time or
pay a penalty and, secondly, that they produce it of the quality
demanded by the Army. Now, those two things, to my mind, bring

QQ14: WASHINGTON HEARINGS

about an increase in efficiency in any company that takes a large
amount of Government business.

Mr. Arnold. The reason I asked that question was because in
May of 1938 I was traveling by train back to Illinois, and going up to
the diner I passed through three pullman loads of German indus-
trialists. One of them had a son who lived in Texas, who was
acting as interpreter. They had been here to Washington and,
naturally, I was anxious to know what they were in this country
for and what they were doing. Of course, at that time I didn't
think of a war, and I don't know whether they did or not.

Mr. Nelson. Very few of us did.

Mr. Arnold. But they were manufacturers employing up to 2,000
people. They were here inspecting our knitting mill and other ma-
chinery. They acknowledged it was more efficient than the German
machinery, and they were here to bring up the efficiency of their own
plants.

All of their inspections had been in the East. They were on their
way out to the Ford plant, I think, just as a side trip.

Mr. Nelson. Well, you will find today, sir, that throughout the
Middle West and the South those plants, particularly making things
like pants and shirts, tents, tarpaulins, and a wide variety of things
where those skills can be developed, have greatly improved their
efficiency in the last year.

Mr. Arnold. And their machinery is just as efficient?

Mr. Nelson. Yes; their machinery is just as efficient.

Mr. Arnold. Ancl you believe that they will be adequate for all
our requirements?

Mr. Nelson. Yes, sir; more than adequate. I think that by getting
Government orders they have thereby learned how to do business with
the Government, and it isn't easy to do business with the Government
because it is a different method of doing business, but the very fact
that they get acquainted and know how to do it, in my opinion, makes
them valuable potential suppliers.

rejections by plant-site board

Mr. Arnold. The committee seems to be interested in the work of
the Plant Site Board. Have there been any instances in which the
Plant Site Board has rejected a plant site proposal because it be-
lieved housing and other community facilities in the area were
inadequate ?

Mr. Nelson. Yes, sir; and there was one that it almost broke my
heart to reject — it was on beautiful land, but it would have required the
building, in our opinion, of a new city at that site — churches, schools,
fire department, police department. There just wasn't, on the basis
of the facts and figures, the available labor at that particular site,
although it was ideal, technically, for the manufacture of smokeless
powder, TNT, and DNT. It was possible to relocate that plant where
there are already housing facilities. I know that particular territory
well. I lived in it as a boy and I certainly would like to have seen
the plants there but to me it seemed illogical to locate a plant where
you would have to build an entirely new community and cause migra-
tion into that area.

NATIONAL DEFENSE MIGRATION 6615

Mr. Arnold. And did you not want to see that good land used
for that purpose?

]\Ir. Nelson. The best farm land in the United States.

Mr. Arnold. But the prime consideration was the lack of
facilities ?

Mr. Nelson. That is right, sir.

Mr. Arnold. Has the Plant Site Board made any efforts to se-
cure the extension of community facilities when, for other reasons,
it seemed desirable to locate or expand a plant in a given area ?

Mr. Nelson. Oh, yes. We are working very closely with the
Housing Coordinator. Facilities have to be put up at some plants
AA'here the only thing to do was to locate it in that particular area.

Mr. Arnold. They had to be located there and so the facilities had
to go in?

Mr. Nelson. Had to go in ; yes.

LABOR SHORTAGE, UNEMPLOYMENT, AND MIGRATION

Mr. Aknold. You indicate in your paper that you fear an acute
general labor shortage next year when the greater part of the new
facilities under construction will get into operation. Another
point you indicate is that considerable unemployment may material-
ize in nondefense industries due to shortage of materials, priorities,
and agreements in the automobile industry. Will you discuss the
seemins: contradiction in those two statements?

Mr. Nelson. Well, sir, it all has to do with this matter of migration.
My two statements are from this point of view : You may have in
places where these defense plants are now located, a shortage of
skilled labor but you will have a general and diverse unemployment
clue, let us say, to the cutting down of the automobile production by
as much as 20 percent, which would create collateral unemployment
in many many areas of the United States other than Detroit.

Here is a company making glass for the automobile industry,
making carbureters, making spare parts of one kind or another — it
may be the textile fabrics that go into the automobile — but the minute
you make a curtailment you have unemployment, relatively small,
that is true, but in many areas of the United States.

Industries like the automobile industry or the refrigerator industry
or other luxury industries may have to be cut down as a result
of the necessity for using those facilities for defense purposes. You
see what my point is?

STATE EFFORTS AT POOLING FACILITIES

Mr. Arnold. That answers the question. We understand that, in
several States, State industrial committees have been set up to work
out pooling arrangements within the State and thus assist in the
decentralization of contracts.

Will you indicate in how many States such committees have been
set up and how effective they are ?

Mr. Nelson. Well, I think, sir, in a large number of States com-
mittees of one kind or another have been set up. They really haven't
been effective except in a few areas. I can point out, for instance,

QQIQ AVASHINGTON HEARINGS

an area like York, Pa., where they have done a magnificent job of
pooling the available facilities in a location to take a defense contract.

In York there are several very good industries like the York Ice
Machine Co., and York Safe & Lock. Now, they have pooled the re-
sources of that particular area to take very large Government con-
tracts and they have done a grand job.

That is also occurring in States like Wisconsin, which, I believe, is
beginning to do a good job. Connecticut has had a very good indus-
trial organization, with the idea of calling to the attention of all the
procurement facilities resources which might be pooled to take prime
contracts, and I believe that the pattern is developing so that from
now on it can become much more effective.

In a State like California, for instance, they are beginning to do
a very good job. I spent some time with the chamber of
commerce in Los Angeles last week and I think they are doing some
very effective work in finding what the facilities are in their locality
and what they might be able to make and in helping direct them to
things that they might do, particularly in the subcontracting field.

Mr. Arjs^old. And also in the prime contracting field?

Mr. Nelson. Well, the prime contracting, of course, is different.
I mean a prime contract usually involves large financial resources,
management, engineering skill, organization, and it isn't easy to
put prime contracts into the hands of a pooled group of manufac-
turers.

When the Army buys a machine gun, fox example, they want and
must have somebody to be responsible, so that the thing they buy is an
efficient piece of mechanism and that it wiU do the job for which it was
intended.

If you pool a group of people who may all be able to contribute
parts to that machine gun, some one outstanding person must be
responsible for seeing that they all function and that they all pro-
duce exactly the quality needed at the time needed and thus produce
for the Army an efficient machine gun.

PROGKESS OF SUBCONTRACTING

Mr. Arnold. Are yoai satisfied with the progress made in subcon-
tracting ?

Mr. Nelson. No ; I am not.

Mr. Arnold. Do you believe that it will increase and become satis-
factory ?

Mr. Nelson. I think it has to increase, sir. I feel that subcontract-
ing is a necessary thing, but I am not satisfied at all with the progress
of it. I think, however, that today there are more people who believe
in it than did 6 months ago and I feel certain that the War Depart-
ment and the Navy Department are interested in it and see the ad-
visability of it and I believe we will find the way to do it in the near
future.

Mr. Arnold. And that has a definite connection with preventing
migration ?

Mr. Nelson. Yes, sir ; a very definite connection.

Mr. Arnold. That is, the wide spreading of subcontracting would
have more to do with the preventing of migration more than any one
thing?

NATIONAL DEFENSE MIGRATION 6617

Mr. Nelson. Certainly. It seems logical to me that if you try to
find work for the machine where it is now located, if it can possibly be
done, it is better than to pull the worker and the machine out of the
location where they now are and move them somewhere else.

UNGHOSTING THE GHOST TOWNS

Mr. Arnold. Will you indicate to what extent ghost towns have been
brought back into production through the efforts of the O. P. M. ?

Mr. Nelson. A great deal of study has been put on that. I can't
indicate to you whether we have actually yet brought ghost towns
back. There will be some when some of these new plants are built
and start working — you will find locations; for instance, here is a
town like Carbondale, 111. Carbondale formerly had a very big
coal-mining industry which disappeared.

Now, it is perfectly possible through the location of a plant site in
that location to do, say, shell loading or bag loading or whatever
it may be, to bring that locality back during the period of time
wliile it is in operation. But I do fear, sir, and I think it is a thing
that has to be very carefully thought out, what is to become of that
town after this defense program is over.

In other words, I sometimes fear that they may be worse off after
the spree than they were before, unless a lot of careful planning is
done.

Mr. Arnold. Of course, you are picking up an area there with which
I am very familiar. At one time 51 percent of their population was
on relief i

Mr. Nelson. Yes, sir.

Mr. Arnold. Or on W. P. A. ?

Mr. Nelson. Yes.

Mr. Arnold. I understand there are about 15,000 unemployed in the
area. Now, that you cannot give us an estimate of the number of
workers in that area who have been reemployed or who will be reem-
ployed as a result of these efforts ?

Mr. Nelson. No, sir; I could not do it, but I am sure that Mr.
Hillman's division could — if you want me to ask him to do it I will
be very glad to do so.

Mr. Arnold. I wish you would do so.

The Chairman. We will make that request, Mr. Nelson.

Mr. Arnold. That is all, Mr. Chairman.

pressure of time element

The Chairman. Mr. Nelson, while we are aiming at 100-percent
efiiciency, we are still human beings and we are dealing with the law
of averages ; isn't that true ?

Mr. Nelson. Yes, sir ; that certainly is true.

The Chairman. This emergency came on us all at once and speak-
ing for myself personally, I am very proud of the way the American
l^eople are holding up and refusing to get excited. In all your
activities in your Office and in the other departments, you are up
against the pressure of the time element at aU times ?

Mr. Nelson. Yes, sir ; all the time.

gglg WASHINGTON HK.\RINGS

The Chairman. And that in part explains why you allocated so
much work to places where they had existing facilities to do the work ?

Mr. Nelsox. I am convinced, sir, that tliat is the main reason it
was done. If we had had 10 years to build, I am certain you would
have seen an entirely different pattern.

The Chairman. You would have spread it out more ?

Mr. Nelson. Very much more.

The Chairman. I am pleased to see you are directing your efforts
toward spreading it out.

You see the only purpose of this committee really is in regard to
interstate commerce of human beings. Therefore, we are concerned
with how these people who go to San Diego, for instance, are getting
along — in how they are being housed, their environment so far as
health is concerned, fire protection, police protection, and then our
next interest is how they are going to get along after this is over.

Mr. Nelson. That is the important thing to me, sir.

The Chairman. And I am glad you mentioned about the load that
comes on these communities.

I think that San Diego is an outstanding example of what our
cities and communities are up against. The committee just returned
from San Diego a few weeks ago. The population of San Diego has
jumped up about 100,000 people. A project known as the Kearney
Mesa project is located just 6 miles from the city of San Diego and
will have a population of 10,000 people.

Mr. Nelson. Even the sewers won't take care of them.

The Chairman. Now, San Diego simply cannot carry that addi-
tional burden. They have to have sewage disposal, schools, and fire
and police protection and we have so far $150,000,000 and San Diego
is asking $21,000,000 for their needs alone. They bonded themselves
to pay for part of the sewage-disposal system, but other problems
come in these, in which they need help.

We found in Coimecticut and New Jersey and Maryland the same
situation. I am very pleased that you agree with the findings that we
have made and the evidence that we have obtained.

Mr. Nelson. Yes, sir.

The Chairman. And are they being charged too high rents?

Mr. Nelson. Yes, sir.

problem after the emergency

The Chairman. We are wondering and interested m how they are
getting along, and we shall do our best to solve that problem, but the
great problem, of course, is going to face this country after the emer-
gency is over.

The testimony shows that millions of people have gone from their
own States to other States on account of our national-defense program.
There is a peculiar thing in this country. We have about 30 States,
Mr. Nelson, that make it a crime to transport an indigent or poor per-
son across a State line.

And at the same time we have the Federal Government encourag-
ing this migration between States, and the result is that we have some
three or four million people who are in the different States with
no State of their own ; and if we don't address ourselves to that propo-
siticMi at this time, a dangerous whirlpool may be caused after this

NATIONAL DEFENSE MIGRATION 6619

emergency is over. It may be just as dangerous as any attack from
Avithout.

Mr. Nelson. I feel, sir, that the free-enterprise system can be
just as much in danger of being destroyed through the after effects
of the defense program as from an attack from without, unless we use
every bit of brains we have while we are building the defense pro-
gram.

The Chairman. Now, so far what has been done about it, outside of
what this committee is doing? The President issued an Executive
order for a survey of the United States to be made regarding the
feasibility of public works projects after the war is over. I think the
Planning Board is interesting itself in the problem.

Therefore, what we are greatly interested in is what these mil-
lions of people, who have gone from one State to another and who are
now getting good wages, are going to do after this emergency is
over. The only cushion for the shock at the end of the war will be
what money they have saved or whatever unemployment compen-
sation insurance they may receive, their benefits from the Social
Security Act, but if they had five or six or seven or eight hundred or
a thousand dollars in their pockets it will cushion the shock. Most
of these people will want to go home. That is a sure thing, and it
seems to me, Mr. Nelson, that the money they may have saved will be
the solution of the problem.

TRIPPED UP BY WORD "cOMPULSORY"

We would like to recommend something to the Congress along that
line, but, of course, we are always up against the word "compulsory."
We did have some evidence in Hartford whereby, under a voluntary
plan, one company was withholding a certain amount of each week's
pay, but, of course, that was voluntarily done.

We are greatly concerned with that, and I think it is a vital
problem.

Mr. Nelson. I think it is a very vital problem. I think that we
must do some national thinking anct some individual community think-
ing and planning along those lines, so this thing doesn't come on them
sucldenly.

Take an area like the one in Los Angeles that I visited last week.
There is a tremendous increase in activities which have come about
due to an increasing expenditure of Federal funds. Locally they
have got to be thinking of that particular problem just as well as the
National Government. I think it is essential that all the brains of
this country be put on that problem now, instead of waiting until it is
over and on top of us.

Tlie Chairman. In our investigation throughout the United States
we have had over 100 migrant witnesses who have come from one Stat-e
to another just to find out what they actually went through, and I
asked one migrant witness in San Diego if he was saving any money
and he said : "No; not a cent."

I said : "Well, how much are you receiving a month?", and he said :
"$135." I said : "How much are you paying for rent?"

He ansM^ered that he was paying $18 a week, which is practically
$80 a month, and he said : "Will you tell me how I can save?"

gg20 WASHINGTON HEARINGS

I said : "How many children have you?", and he said : "I have six."

So that is one thing we have got to address ourselves to — high
rentals; but we will take that up with Mr. Henderson.

Mr. Nelson. He will be able to cover that with you.

The Chairman. Mr. Lamb.

Mr. Lamb. Mr. Nelson, you spoke about the moving out of machines
and ways and means of preventing that. Do you have any estimate of
the proportion of machines bought up and moved and the plants
closed ?

Mr. Nelson. No, sir ; I haven't. Perhaps Mr. Mason Britton, who
handles that in O. P. M., could give you some figures on that. I haven't
any at present. It has been largely those that have been bought by
various industries themselves. There hasn't been any pressure yet
put on by the Government on any industry to release machine tools.

Mr. Lamb. I was only thinking of the voluntaiy closing down of
plants which were not getting orders because they were unsuccessful
bidders or something of that kind.

Mr. Nelson. I would suggest you contact Mr. Mason Britton, who
may have some of the figures. At least he can get you some approxi-
mation on it.

Mr. Lamb. Thank you.

The Chairman. Mr. Nelson, I just want to say that we deeply ap-
preciate your coming here and I thing yours is one of the most valu-
able and intelligent contributions we have had.

Mr. Nelson. Thank you, sir. I am intensely interested in this
problem.

The Chairman. Our next witness is Mr. Leon Henderson, Ad-
ministrator, Office of Price Administration and Civilian Supply.

TESTIMONY OF LEON HENDEESON, ADMINISTEATOR, OFFICE OF
PEICE ADMINISTRATION AND CIVILIAN SUPPLY, WASHING-
TON, D. C.

The Chairman. Mr. Henderson, on behalf of the committee I want
to thank you for coming here this morning. During the last session
of Congress this committee was appointed to investigate the migration
of destitute citizens between States.

We traveled throughout the United States and made our report and
recommendations to Congress. This session we were continued on the
theory that migration instead of decreasing had increased because of
this national-defense program.

STATEMENT BY LEON HENDERSON, ADMINISTRATOR, OFFICE OF
PRICE ADMINISTRATION AND CIVILIAN SUPPLY, WASHINGTON, D. C.

I am happy to come before this committee today to participate in your discussion
and investigation of the relationship of the defense program to the problem of the
migration of workers.

Defense production has caused, and will continue to cause, tremendous and
rapid shifts in employment — mostly increases, but with some decreases in certain
lines or areas. These shifts raise a host of problems : Where additional workers
are needed in areas having defense contracts, recruitment must be speedy and
must provide proper skills. Where workers congregate in rapidly growing ai'eas,
they face difficult problems of housing, sanitation, community welfare, and con-
sumer protection. Where employment is reduced as a result of priorities or other
factors arising out of the defense program, problems are raised concerning relief
and labor training and there is the important problem of bringing new work to

NATIONAL DEFENSE MIGRATION Qg21

unemployed labor or supervising the shift of unemployed labor to available
employment.

My special responsibilities as Administrator of the Office of Price Administra-
tion and Civilian Supply are to prevent rapid price increases and spiraling of
prices, visages, and the cost of living; to allocate materials which are put under
priority control in such a way as to cause a minimum disturbance to the civilian
economy; and, finally, it is the responsibility of this office, under the direction of
Miss Harriet Elliott, to protect the consumer.

Most defense agencies are concerned with one or another aspect of the problem
of defense migration. Other Federal officials have appeared and will appear
before you to describe the special features of this problem which come under
their jurisdictions. I want to do two things today : First, I will present the fac-
tual background of the rent situation and will summarize the activities of Office
of Price Administration and Civilian Supply which have a direct bearing on the
rent situation ; and, secondly, I will discuss the problem of unemployment caused
by the imposition of priorities and civilian allocation.

PRICE OF HOUSING

One of the prices we are most immediately interested in is tlie price of housing —
rents. We are interested in rents because the price of housing can, under certain
circumstances, spiral upwards to the great and immediate detriment of consumers,
and usually those consumers who can afford it least. We know that rents have
been rising where hundreds or thousands of new defense workers have swarmed
into areas with inadequate housing facilities.

Rents charged for housing acconmiodations in defense areas have a direct bear-
ing on many aspects of labor migration. If defense production is to proceed
smoothly we must be assured (1) that workers will be willing to migrate to
those areas where they are needed, when they are needed ; (2) that once they
have accepted defense jobs in new localities their living costs and general living
facilities are reasonable enough to keep them there; (3) that if they choose to
stay, their health and morale will be maintained.

Because of the sudden impact of defense activity in many centers, it was to be
exix^cted that problems would arise involving housing and community facilities
and the cost of living. And in fact, we are finding — on the basis of vacancy
and rental surveys now in progress in more than 100 defense localities — that
where the housing shortage is most acute rents are skyrocketing.

It will be difficult to continue to attract workers with the necessary skills to
aircraft, shipbuilding, and ordnance centers unless they are provided with decent
housing facilities at reasonable rents. Private residential construction and
Government allocations for defense housing are alleviating congestion, but in
m'any areas they are not able to keep pace with the growing demand for rental
housing, and as a result of the shortage, rents are reacting sharply. In some
shipbuilding, ordnance, and Army cantonment centers as many as 1 out of every 2
rented homes have had rent increases ranging from 20 to 100 percent since October
1939. The specific examples I shall quote illustrate similar conditions in other
defense 'areas ; they are not used with any intent to single out these communities.
In the great aircraft center of San Diego there has been an average increase of
14 percent on about 50 out of every 100 rented homes ; in the new aircraft center
now being developed in Wichita, Kans., there has been an average increase of
12 percent on 25 out of every 100 rented homes. In Pascagoula, Miss., a fast
growing shipbuilding center, there has been an average increase of 24 percent on
60 out (if every 100 rentals for white occupancy; in Bremerton, Wash. — the site
of the Puget Sound Navy Yard — there has been an average increase of 16 percent
on about 50 out of every 100 rented homes. The expansion of an ordnance depot
in Burlington, lowti, brought with it an average increa.se of 33 percent on 58 out
of 100 rented homes: a new ordnance plant in the Milan-Humboldt area, Ten-
nessee, brought with it an average increase of 95 percent on 40 out of 100 homes.
Key centers of varied industrial production have been likewise affected. There
has been an average 13 percent increase on 66 out of 100 homes in N'ew Britain
Conn. ; an 'average 16 percent increase on 50 out of 100 homes in Pontiac, Mich.
Communities adjacent to Army cantonments have reported some of the most
extreme cases of upheavals in the local rental market : In Brownwood, Tex., there
has been an average increase of 69 percent on 78 out of 100 homes ; in Alexandria,
La., an aver'age increase of 36 percent on 55 out of 100 homes.

When situations of this character develop, increasing the supply of available
housing facilities is the obvious .solution. But where this cannot be done fast
enough and in sufficient quantity some control of the rental situation becomes

gg22 AVASHINGTON HEARINGS

imperative. Otherwise, workers will avoid those very defense centers where their
skills are required. Or if they do come, they will soon discover that high wages
are illusory when exorbitant rentals eat away a third and more of their earnings.
Workers will move out again. They will turn to other defense areas — in itself a
waste of manpower during the process of migration — or back to nondefense
centers. When acute rental conditions cause excessive labor turn-over and result
in a futile migration of labor, they are detrimental to the defense effort and
demand regulatory action.

KENT CONTROL

Rents must be controlled, moreover, in order to maintain the health and morale
of the general civilian population. Our oflice has received letters from scores of
families of defense workers and of Army men, of service workers and of people on
relief, protesting against rent profiteering in defense localities. All express
resentment when landlords take advantage of a market with practically no
vacancies to increase rents. It should be noted that in general these sharp upward
movements in rent are particularly unjustifiable because they are not accompanied
by substantial increases in the cost of operation.

Rent increases are an especially heavy burden on people with low incomes or
moderate fixed incomes. Since there are no vacancies in many defense communi-
ties, the tenant has no choice. He either pays or he is evicted. If he is unable to
pay and is evicted, he sometimes has to leave town. We have had reports from a
number of centers adjacent to Army cantonments and ordnance plants that
natives of these communities have been forced to move far out into the country
because they could not pay higher rents. Such incidents have a disturbing effect
on the morale of our people.

When workers are forced to pay increased rents it means cutting other items
in the budget, because rents are relatively inelastic. Since we know from our
surveys that on the whole rentals under $30 a month are increasing by a higher
percentage than those over $30 a month, the group which can least afford it is
hardest hit.

Finally, higher rents in industrial defense areas involve us in the general
problem of wages. Exorbitant rent increases almost invariably produce de-
mands for wage readjustments. Some union contracts have specific clauses
stipulating a reopening of wage negotiations when the cost of living rises.
Since rent normally consumes from 20 to 25 percent of a worker's earnings — and
in some areas this ratio today is even higher — rental change is an important
factor in rising living costs. We can avoid a great deal of industrial unrest
by eliminating some of the grievances behind demands for reconsideration of
wage scales. If we fail to curb rent increases we are contributing to the spiral
of rising living costs, rising wages, and still higher living costs, from which
nobody stands to gain in the end.

The details of the rental situation in some 75 defense localities will be made
available for the record.

RENT UNIT OF O. P. A. C. S.

I wish now to describe what we are doing about the problem at the present
time: In the Price Division of our Oflice there is a rent unit which sends
members of its field staff into those areas most seriously affected by rent
increases. Frequently they go at the direct request of local officials. After
reviewing the situation, members of our staff aid municipal authorities and local
defense councils in establishing what we call fair rent committees. Our staff
outlines fundamental principles of procedure on a voluntary basis. After the fair
rent committee has been appointed by the mayor, it publicly points out the
dangers of exorbitant rentals and sets up an office to receive tenant complaints.
These complaints are examined, and cases are selected for mediation. The land-
lord is summoned to a hearing to explain the increase, and the committee, after
considering a variety of factors, makes a specific recommendation. The actual
power of the fair rent committee is dependent upon the degree of public support
which it enjoys in a community. Some ten such committees are now functioning ;
others are being set up.

This method of procedure on a voluntary basis has certain patent limitations.
Voluntary control may succeed temporarily in restraining upward trends ; It
lacks the authority to reverse such trends. There is no question in my mind
that ultimately the authority of law will have to be invoked to curb rent increases
in those areas where voluntary methods are only partially successful.

NATIONAL DEFENSE MIGRATION 6623

HOUSING PROBLEM EiXATED TO DISTRIBUTION OF ORDERS

The problems concerning housing and rents arise chiefly because of the con-
centration of defense production in certain localities. You know, of course, that
one of the early goals of the National Defense Advisory Commission was to
avoid undue concentration of contracts and to utilize for defense production the
labor of every sector of our working population, wherever located, and the
capital equipment of every part of our industrial establishment, small and
medium-sized concerns as well as our huge corporations. This is still a goal of
the Federal defense agencies.

The statistics relating to the geographical concentration of contracts and the
geographical distribution of new-plant expansion have been presented to you this
week, and there has been considerable discussion of this whole problem. I wish to
make only two comments on this subject. In the first place, the accessible data
tend to exaggerate the actual extent of concentration of defense production in
certain areas. Much of the production called for by prime defense contracts is
subcontracted and therefore actually produced in other areas. Statistics on
subcontracting are as yet incomplete. We do know, of course, that the pattern
of American industrial production is highly complex. It is difficult to tabulate
the percentage of the value of a prime contract let, say, to a New England small-
arms manufacturer, which is subcontracted to a nut-and-bolt manufacturer in
Maryland, a walnut-stock manufacturer in northern Michigan, and a special
high-grade steel producer in the Cleveland area. Moreover, it is obviously im-
possible for us to indicate or trace statistically the spreading out across the
country of the increased productive activity which results from the increased
incomes and expanded purchases made by the workers and their families in
that New England town — on automobiles, movies, clothes, toys, furniture,
food, etc.

SOME GEOGRAPHIC CONCENTRATION INEVITABLE

The second point I want to make Is that there must always be some geographic
concentration of industrial production. That is the result of the character of
our economy and of our geography. It is on the basis of a complex pattern of
geographical specialization over an area as large as the United States that
much of the wealth and prosi>erity of this Nation has been built. It would be
absurd to expect, for example, that the woolen mills producing overcoats and
uniforr^s for our greatly expanded Army .should be distributed equally through-
out each State in the Union, including the Rocky Mountain section. It would
be just as absurd to expect that the raising of the sheep from which these imi-
forms are made should be distributed equally thi-onghout all the States, includ-
ing the industrial areas of New England and the Atlantic coast.

Because of these factors it is obvious that the initial impact of defense con-
tracts will not be uniformly spread throughout the Nation. When we began our
tremendous defense program, we let ourselves in — deliberately and inevitably —
for a great deal of migration of labor. That is one of the costs which we ac-
cepted cheerfully when we decided that our Nation coidd only be secure after a
tremendous defense effort. We were able to do several things, however, to ease
the ijroblem of concentration of defen.se production. We attempted to see to it
that defense production did not cause any greater geographic concentration than
had already been brought about by regional specialization of production in the
United States, or than became necessary because of the character of special
types of defense work, as, for example, the building of ships.

Great efforts are being made to insure through subcontracting that defense
production is widespread and makes full use of our available industrial plant
and labor force. Much can be done to avoid concentration of defense produc-
tion when locating new plants. With this aim in mind, many ammunition plants,
smokeless-powder plants, bag-loading plants, etc., have been located in non-
industrial regions ; for example, the smokeless-powder plants in Radford, Va.,
and Charlestown, Ind., and the .shell-loading plant in Burlington, Iowa.

Of course, we should realize that the attempt to avoid concentration of
defense production and to locate these tremendous new plants in regions not
already highly industrialized or densely populated has led to some of the most
difficult problems which confront this committee. This is true not only with
respect to housing, but it is especially true with respect to essential community
services and amusements. It may be that a new arsenal located in Philadelphia
would have brought as serious a problem of housing in that already congested
60.396— 41— pt. 16 21

6624

WASHINGTON HEARINGS

industrial region as it has brought to relatively sparsely settled Ravenna, Ohio.
But certainly the community facilities for essential services, education, amuse-
ments, etc., would have been an easier problem to meet in Philadelphia than in
Ravenna.

UNEMPLOYMENT DUE TO PRIORITIES

Now I come to another kind of problem arising out of the defense program
which directly concerns this committee and which has a most important bearing
on the work of the Office of Price Administration and Civilian Supply. It is the
opposite of the problem caused by the concentration of defense production. It Is
the problem of unemployment resulting from the imposition of priorities. It is
what happens when we shift all our aluminum ingots to the the making of air-
planes and leave none over for making pots and pans. It results from our
decision to build up our stock of rubber for future eventualities at the expense
of some drivers of passenger cars — and of some of the workers in the rubber
plants.

When defense requirements force a curtailment of normal civilian produc-
tion, then it is necessary to allocate whatever supplies remain for civilian use.
This civilian allocation is one of the heavy responsibilities of the Office of Price
Administration and Civilian Supply. This Office has to decide which civilian
demand will be satisfied and which will not, which manufacturer shall produce
and how much. When machine tools are allocated to one or another form of
defense production or allocated among the Army, Navy, and our Allies, this does
not result in unemployment in any immediate sense. But the application of priori-
ties to copper, cork, aluminum, magnesium, and a whole range of basic metals is
going to cause some unemployment. If it is decided, as it was last month, that
95 to 100 percent of aluminum, including scrap, must go to defense production,
then the civilian industries normally using aluminum will obviously be in a very
serious situation.

Of course one of the steps that can be taken in a situation such as this is
to expand the supply of the article in question so that enough will be available,
after some steps have been taken, to meet botli defense and normal civilian
demands. This has been one of tiie lines of policy which' I and my Office
have followed most energetically during the entire period of the defense pro-
gram. But if, for various reasons, the supply is not expanded sufficiently, then
some normal civilian consumers of the scarce commodities will find empty
store shelves. If the normal producers of these civilian commodities do not
receive defense contracts or if they cannot find substitute raw materials, this
means unemployment of workers.

EXAMPLES OF "PRIORITY UNEMPLOYMENT"

You members of the committee and we officials of defense agences — to say
nothing of businessmen, trade-union leaders, and workers — have already known
of examples of unemployment directly caused by the operation of priorities
and civilian allocation. Even though the priority program is as yet in its
early stages, we know that workers are already unemployed in New Kensing-
ton, Pa. ; in Manitowoc, Two Rivers. Chilton, Kewaskum, West Bend, ano
Eau Claire, Wis. ; and in New Washington, Ohio, and Lamount, 111., because
the factories in which they normally work producing aluminum pots and pans
and other miscellaneous stamped aluminum products can get no more alum-
inum. We know that plants producing aluminum die castings in Marshall-
town, Iowa, Cleveland, Ohio, and other cities have curtailed production and
laid off men. We know that priorities on nickel and nickel steel are begin-
ning to affect employment in silverware, plated ware, and flatware establish-
ments. The rubber allocation program has already re.sulted in the first of
a series of lay-offs in the rubber industry. As production of 1942 automobiles
is curtailed, there will be some uneniployuHMit nnt only in the automobile plants
but in the widespread automol)il(' equiiinient ('stal)lishments as well.

Thus far, however, the number of persons actually laid off and the num-
ber of plants whose operations are curtailed or actually closed down because
of priorities on basic materials is not large. It is only because we stand today
just at the threshold of the operation of the priorities system that this
problem is not already npon us as a problem affecting tens of thousands of
workers and hundreds of plants. In the first place, priorities have only been
in existence for a few months and most priority orders have been issued since
April 1. The first industrywide priority order came on February 24, 1941.

NATIONAL DEFENSE MIGRATION 6625

At the preseut time, only 14 coiumodities are subject to complete priority
control. Civilian allocation is even more recent. The tirst civilian allocation
program, covering copper, was issued by Office of Price Administration and Civil-
ian Supply on May 31, 1941. To date we have issued five civilian-allocation pro-
grams. In the second place, the full effect of priorities has not been felt
thus far because manufacturers accumulated inventories last year and early
this year with which they are able to continue production for some period
of time, even after mandatory priorities controls are imposed.

But I know that this problem is going to be greatly intensified before this
summer has passed. You know that I have long been an advocate of every
sort of measure which would bring about a legitimate increase of employment
and end the terrible suffering and waste caused by unemployment. I now
have as one of my heaviest responsibilities as Administrator of Office of Price
Administration and Civilian Supply the necessity of taking definite actions
which will have as one result a reduction of employment. I can assure you
that we in Office of Price Administration and Civilian Supply are giving this
problem the most thorough and detailed consideration.

THREIE WAYS TO COUNTEK PRIORITIES

In general, of course, there are only three things which can be done. One
is to bring new work to the manufacturer of civilian products so that he can
use his existing plant and labor force in a different kind of output ; a second
is to expand supply so that priorities can be relaxed or not applied so strin-
gently as otherwise; and a third is to shift the labor let off from civilian
production to new .jobs.

The various agencies of the Federal defense organization have already set to
work to meet this problem of curtailed production and employment resulting
from priorities and civilian allocation. For example, the Defense Contract
Service of the Office of Production Management, with its regional offices, is hard
at work to get defense production out into all the small plants of the country
by the subcontracting of prime defense contracts. This means that manufac-
turers wha'^e supply of raw materials is cut off because they have been producing
for civilian use will be able to employ their plants and their men for an enlarged
defense output.

The Conservation and Substitutes Committee of Office of Production Manage-
ment is working on substitute materials and tries to help manufacturers whose
supply of a certain raw material is curtailed by indicating the substitute raw
materials which can be used so that normal production is not curtailed.

Through the Labor Division of the Office of Production Management, in co-
operation with the Bureau of Labor Statistics, the Federal Committee on Ap-
prenticeship, the United States Employment Service, the Work Projects Admin-
istration, National Youth Administration, the Office of Education, and other
Federal agencies, a tremendous labor-training program is under way. and it is
estimated that over a million jjersons have already received the benefit of this
special training for defense jobs. About one and a half million more are receiv-
ing training within industry. Thus it is possible for employees whose jobs are
threatened by priorities and civilian allocaton to be retrained for defense work
either in the same plant after subcontracting brings it some share of defense
work, or in other plants.

In its civilian allocation programs, the Office of Price Administration and
Civilian Supply is making every effort to see to it that any necessary curtailment
of production for civilian use is carried out on the fairest possible grounds. In
that connection we have issued a list of factors which we will take into consid-
eration in formulating policies and programs for our civilian allocation programs.
That list is as follows:

(a) The need to provide adequately for civilian uses essential to the public
welfare.

(6) The degree of hardship upon labor or business resulting from the fail-
ure to obtain deliveries when scheduled or from the rejection of orders.

(d) The objective of achieving an equitable division of supplies of the prod-

ucts among all users.

(e) The availability of substitutes for the particular uses for which the

products are sought.

(f) The policy of the Administrator to refuse allocation to any person who,

in the conduct of his business, discriminates against defense orders.

QQ2Q WASHINGTON HEARINGS

Many of the efforts of those interested in increasing supplies, those interested
in subcontracting, and those interested in labor training are being presented to
this committee direcly by officials of the agencies involved.

What we are doing at Office of Price Administration and Civilian Supply, and
what these other defense agencies are doing to insure that every portion of the
Nation's industrial plant and labor force is utilized for defense production, with-
out undue disruption or hardship, is significant. But I believe these efforts can
be improved. I believe they must be improved at once if we are to fulfill our
responsibility to assure the American people that the operation of the priority
system in the interests of maximum defense production will not result in
unnecessary hardship.

Exhibit A. — Rent iNCRiiASEs in Defense Areas, Octobek 1939 Through June

1941

statement by office of price administration and civilian bupply, office of

production management, WASHINGTON, D. C.
rents and the COSTS OP LIVING

It has been estimated in cost-of-living studies that rents normally absorb
from 20 to 25 percent of the average wage earner's income ; the exact propor-
tions differ in various parts of the country, depending upon a variety of local
factors. Rents are usually paid on a monthly basis, and any substantial in-
crea.se becomes a noticeable burden because it must be expended in a lump
sum. Wage earners are for this reason often more sensitive to rent increases
than to other price rises. Since rents are the second largest single item in the
budget, following food, a marked increase in rents may mean the curtailment
of other basic needs and lead to a proportionate lowering of the general
standard of living. Furthermore, rent is a relatively inelastic item in the
budget. If clothing prices increase, purchasing may be adjusted with com-
parative ease. The physical need for shelter, however, is a requirement which
cannot readily be scaled down without involving extreme liardship.

defense housing and the inadequacy of sutply

The Division of Defense Housing Coordination has given consideration to
the need for housing in some 300 defense localities throughout the country.
The Congress has thus far appropriated $442,.531,000 to alleviate acute housing
shortages by direct Government con.^truction. As of July 5, 1941, 107,383 family
dwelling units have been allocated by the Defense Housing Coordinator to 170
localities for the housing of civilian industrial workers in private defense in-
dustry, civilian industrial workers in Government plants, other civilians em-
ployed by the Army and Navy, and married enlisted personnel ; 70,146 of these
units are now under construction contract. Private industry, aided by the
Federal Housing Administration, the Home Owners' Loan Bank Board, and the
Defense Homes Corporation, is building thousands of additional units in and
about defense areas.

However, the influx of workers into defense industries and the concentration
of the families of enlisted personnel near military establishments have been so
rapid that neither private construction nor Government awards have been able to
meet the need in time. Of 18,947 defense housirg units which were listed as
completed on July 5, 1941, only 3,245 units were occupied by industrial workers
in private defense industry, 3,918 by civilian industrial workers in Government
plants, and 2,656 by other civilians employed by the Army and Navy ; the remain-
ing 9,128 units were occupied by married enlisted personnel. Housing shortages
in many defense localities have been seriously aggravated by the arrival of thou-
sands of construction workers and service workers for whom no defense housing
will be provided, as well as casual migrants attracted by the hope of employment-
According to the best estimates, funds for defense housing thus far granted by
the Congress will be able to care adequately for only about a third of all the
inmigrant workers. Even if 70,000 units of defense housing now allocated are
completed by October of this year, as scheduled, there will still be shortages in
many areas.

At the request of the Division of Defense Housing Coordination, the Work
Projects Administration has conducted vacancy surveys in 141 defense areas.
These surveys, most of which were completed during the first 6 months of this

NATIONAL DEFENSE MIGRATION 6627

year, reveal that in 103 of the areas there was habitable rental vacancy of under
2 percent ; in 61 of the areas there was a habitable rental vacancy of unled 1 per-
cent. Housing authorities consider a 4 percent vacancy to be the absolute mini-
mum for the maintenance of a normal housing market.

Under these circumstances it was to be expected that rents should react sharply
to the acute shortage. In many localities landlords and property owners have
already taken advantage of the situation to demand exorbitant rents, and no
adequate supply to restore a normal competitive market is in sight. Indeed there
is a high probability that shortages in some building materials and labor shortage
in the construction industry will in the future materially decrease the rate of new
construction. The experience of the last war amply fortifies this presumption.

RESULTS OF 0FFICL\L STJRVEYS

Rent increases have been far more widespread in areas where defense industry
and military establishments are concentrated than in areas which have not been
directly affected by the defense program. Rent increases may spread to other
localities, but for the time being they remain primarly a problem of defense cen-
ters. National averages of rental change are therefore not very pertinent to
the discussion of the immediate need for rent control. It is necessary to isolate
the areas where exhorbitant increases first appear and to identify the classifi-
cations of rental property most seriously affected within those areas.

On the basis of vacancy reports, labor migration surveys, housing market
analyses, records of military concenti'ation. and defense contract awards, a group
of approximately 100 areas was selected for special rent surveys by the Bureau
of Labor Statistics and the Work Projects Administration. The 77 localities for
which serious situations have been reported — centers of shipbuilding and the
manufacture of aircraft, munitions, steel, automobiles, machine tools, rubber
and aluminum, as well as camp sites and naval bases — cover cities and towns
in all parts of the country. Thirty States are represented in the surveys.

The distribution of the 77 localities by population groups shows that both
large and small communities are affected :

77 Defense areas hy population

Numier
of areas
Under 100,000:

0-19, 999 23

20, 000-39. 999 16

40, 000^9, 999 9

60, 000-79, 999 5

80, 000-99, 999 3

100, 000-199, 999 13

200. 000-299, 999 ^ 7

300, 000-399, 999 1

Total 77

Source : Census of 1940.

In addition to these 77 surveys, material is available on rental change in 33
large cities wher the Bureau of Labor Statistics has conducted regular inquiries
for many years; 13 of these 33 large cities may be considered vital defense

The localities surveyed by the Bureau of Labor Statistics cover the period
beginning October 1939; the latest data included vary from March through
June 1941, depending upon when the most recent resurvey was tabulated. The
Work Projects Administration surveys are based upon the period beginning
March 1940. Hence these 77 special surveys are not absolutely comparable in
time; but the periods covered are sufficiently similar to permit some groupuig
of the results.

Rents in defense localities have reacted in different degrees to housing short-
ages, depending upon several factors: (1) the percentage of previous vacancy;
(2) the number, wage group, and race of defense workers migrating to the
new locality; (3) the previous rent level in the locality; (4) the rate of new
construction both by private industry and Government agencies; (5) the
success with which civic pressure has been brought against profiteering.

6628

WASHINGTON HEARINGS

The frequency of rental increase and the percentage increases in these defense
areas are summarized below by five types of defense activity :

Rent surveys of selected defense areas for periods between October 1939 and

June 19 U

Locality

State

Period

Percent of

homes

reportinc

increased

rentals

Percent
of in-
crease »

San Diego

Hartford area

California

Connecticut

October 1939 to April 1941_..
do

48
38
24
20

14
9

Wichita ...-

October 1939 to May 1941...
October 1939 to April 1941. __

Paterson

New Jersey

SHIPBUILDING

Pascagoula:

JMississippi

October 1939 to April 1941...
October 1939 to June 1941...
October 1939 to April 1941...

/ 59

/ 43
\ 16

f 38

i 50

f 32

\ 39

I 25

Bayonne ...

Bremerton

Camden:
White

Washington

16
12

do .

Chester:
White

JNorth Carolina

New Hampshire

Wisconsin...

Maine

California

Connecticut

Massachusetts

March 1940 to May 1941

October 1939 to June 1941....

March 1940 to May 1941

March 1940 to March 1941...
October 1939 to April 1941...

March 1940 to May 1941

October 1939 to April 1941...

Wilmington (total):

White

Negro

31
31

Portsmouth

Manitowoc

Bath

Vallejo and Benicia

New London and Groton

Quincy

14
16
19
20
13
11

ORDNANCE

Burlington

New Albany-Jeffersonville
area.

Iowa

Indiana

West Virgmia

March 1940 to May 1941 ....
October 1939 to April 1941...

March 1940 to May 1941

58
53

48
44
42
40
3S
36
33
30
29

Illinois

Radford-Pulaski area

Virginia

March 1940 to June 1941

La Porte

Indiana

Tuscumbia

Alabama

Ohio -

March 1940 to May 1941

March 1940 to June 1941

March 1940 to May 1941

Florence

Alabama..

Ohio

Warren

DEFENSE PRODUCTION (OTHER)

New Britain

South Bend

Connecticut

October 1939 to April 1941...

66
58
50
46
42
40
40
40
39
38
37

{ ?l
{ '1

32
26

Waterbury

Connecticut

.. . do

New York

March 1939 to May 1941

October 1939 to May 1941...

March 1940 to May 1941

March 1940 to June 1941

October 1939 to April 1941...

New York

Bristol...

Connecticut

Alabama

Ohio

JKentucky

Sheffield .

Akron area

Louisville:

White

Gary:

White

kndiana

October 1939 to AprU 1941..

March 1940 to May 1941

October 1939 to April 1941...

Elizabeth

New Jersey

Connecticut...

Pennsy 1 vania

Meriden

Bethlehem and Allen town...

' Rent increase stated as a percent of former rental for those dwellings reporting increases.

NATIONAL DEFENSE MIGRATION

6629

Rent surveys of selected defense areas for periods hetiveeu October 1939 and
June 1941 — Continued

DEFENSE PRODUCTION (OTHER)— Continued

Locality

State

Period

Percent of

homes

reporting

increased

rentals

Percent
of in-
crease

Monongahela River Valley

area.
Gadsden:

White . ..

[Alabama

Pennsylvania

}ohio..

}--. do

}— -do

Michigan

October 1939 to May 1941...

October 1939 to April 1941. ..

March 1940 to June 1941

October 1939 to May 1941. _ .

October 1939:to Apri 1941. . .

October 1939 to March 1941 .

October 1939 to April 1941...
March 1940 to June 1941

October 1939 to'April 1941...
do

26
f 23

* M

/ 20
I 16

/ 19
I 18

/ 17

\ 52

/ 16
I 34

f 16

I 35

Negro

Ohio River Valley area

YoungfStown:

White

9
16

Dayton:

White

Massillon:

White

Bay City

Canton:

White —

}ohio

^Pennsylvania

Negro

Steelton:

White

Negro

Michigan

New York

March 1940 to May 1941.....
October 1939 to March 1941..

Muskegon

MILITARY ESTABLISHMENTS

Brownwood

Texas

March 1940 to June 1941

March 1940 to May 1941

March 1940 to April 1941....
do

78
f 70

80
1 13

f 66
1 56

f 65

' iS

f 63

55
65

51
16
9
49
43
40

39
36

/ 37

' i

f 33
^ 11

\ It

1 22

f 26

I 24

Florida

White

Negro

JMississippi

JTexas

Hattiesburg:
White

Negro

El Paso:

White . - .

Mineral Wells.

' do

March 1940 to June 1941

October 1939 to April 1941...
March 1940 to June 1941

March 1940 to March 1941...

October 1939 to April 1941...

March 1940 to June 1941

Macon:
White

JGeorgia...

Negro

Abilene

Alexandria (total)

Louisiana

Texas

Oklahoma

North Carolina

White

Corpus Christi:

White

Mexican

Negro.

Lawton

20
5
31

Favetteville

Tacoma

October 1939 to April 1941...
March 1940 to June 1941

October 1939 to April 1941...
June 1939 to March 1941

October 1939 to April 1941...
March 1940 to June 1941

March 1940 to May 1941.....

October 1939 to April 1941...
do

\labama

White

Negro

JFlorida

Tampa:

White

22
18

Battle Creek..

Columbia:
White

Michigan.

}south Carolina

California

Ivirginia

Petersburg (total):
White

Spartanburg:
White

}south Carolina.

27
23

Negro

Middletown

Ayer

M assachusetts

Utah

March 1940 to June 1941 . _ _
March 1940 to May 1941

Ogden

Sources; Surveys by the Bureau of Labor Statistics and by the Work Projects Administration.

6630

WASHINGTON HEARINGS

Fourteen of the thirty-three large cities on which the Bureau of Labor Sta-
tistics has prepared regular rent reports have revealed substantial rent in-
creases for the period October 1939 to March 1941. With one exception — Man-
chester, N. H., — these 14 cities are vital centers of defense industry — shipbuild-
ing, aircraft, and machine-tool centers :

Under $30

$30 to $49.99

$50 and over

Percent
of units
in sample

Percent
of in-
crease

Percent
of units
in sample

Percent
of in-
crease

Percent
of units
in sample

Percent
of in-
crease

48
74
82
79
84
52
80
66
61
61
77

-1-1.4
+5.3
+1.9
+1.5
+1.5
+3.5
+6.2
+2.3
+3.4
+8.3
+ 1.8
+6.6
+ 1.5
+2.1

38
21
41
41
23
14
17
15
39
16
27
33
32
21

-.3

+.4
-.1
+.4
+.1
+ 1.0
+4.4
+ 1.6
+.5
+3.1

+2:4
+.3
-.4

10
8
17
11
3
4
4
1
9
4

-1.7

-1.1

Chicago

-1.2

Indianapolis

+ 1.9

+1.1

Manchester, N. H

Memphis

+.7

Mobile

+1.3

New Orleans

+1.7

Norfolk

Philadelphia

-.6

Seattle

-.2

Note.— The percentages indicate the change in the over-all rent bill for all white homes.

An increase of 2 percent in the over-all rent bill of any rent range is
evidence of a w^idespread frequency of increase as well as a substantial per-
centage of increase. Among the cities in this group there are four : Birming-
ham and Mobile, Ala. ; Jacksonville, Fla. ; and Norfolk, Va., which show increases
of more than 5 percent in the range under $30. Though further break-downs
by frequency and percentage of increase are not available, such rent rises are
of the same character as some of the more acute situations in smaller defense
areas.

From a detailed analyf^is of the complete tabulations of the 77 special rent
surveys, as well as the data on 13 large defense cities, it appears that both
the frequency of increase and the percentage of increase have tended to be
greater in rent ranges under $30 than over $30. This is particularly significant
in view of the fact that in most of the cities surveyed rentals under $30
comprised more than 50 percent of the total residential rents. There was
a tendency for the identical dollar increase to cover a whole group of rent
ranges from $15 to $30 or from $20 to $40, for example. Hence, the burden
upon the lower-rent ranges and the lower-income groups was relatively greater.

The frequency of increase and the percentage of increase were greater where
there was a tenancy change than for imits where the same tenant occupied
the dwelling throughout the p(:riod surveyed. New defense workers would fall
entirely into the first category. In Akron, Ohio, for example, the rentals
of fully 94 percent of the dwelling units which had a tenancy change during
the period October 1939 to January 1941 were increased. Thus in addition
to the normal expenses of moving families into new areas, defense workers
are confronted with a narrower selection of units and a higher rental than
older inhabitants.

An analysis of the defense areas surveyed, grouped about major activities
in these localities, will indicate the extent to which all vital defense industries
are affected by rent increases.

Shipbuilding centers have figured prominently among localities which reported
marked rental increases. Substantially the same condition In varying degrees
has been found along the Atlantic and Pacific coasts and the Gulf — in Bath,
Maine ; Camden, N. J. ; Mobile, Ala. ; Bremerton, Wash. Many shipbuilding
centers are located near relatively small communities. The influx of skilled
and semiskilled workers into these centers has created housing demands for
which an adequate supply could not be provided in time. This is especially
true of new shipbuilding centers which underwent sudden development, such
as Pascagoula, Miss. It is also true of centers which had remained relatively
inactive for many years after the first World War, such as Wilmington, N. C,
and Bath, Maine. Shipbuilding was one of the first aspects of the national-

NATIONAL DEFENSE MIGRATION 5631

defense program to get into high gear, and by the fall of 1940 rentals in these
areas were already reacting to the housing shortage.

Aircraft centers which have reached unprecedented employment levels are
among those to report substantial rent increases — San Diego, Calif. ; Hartford,
Conn. ; Paterson, N. J. ; Seattle, Wash. In recent months aircraft centers
which before the emergency had very substantial vacancy percentages have
since reported negligible vacancy percentages accompanied by I'ent increases —
Wichita, Kans. ; Buffalo, N. Y. ; Baltimore, Md. ; Nashville, Tenn.

New munitions factories and shell-loading plants were of necessity built in
comparatively isolated areas. Rent increases which spread through all adja-
cent towns within commuting distance raised new rent ceilings which have not
been lowered even after the thousands of construction workers called in to build
the plants left the areas, as shown, for example, by the surveys of the Radford-
Pulaski area in Virginia, and reports from the Charlestown, Ind., area.

The movement of rent increases has also spread to the varied industrial centers
of New England, the Middle Atlantic States, and the Middle West. During the
depression many of these industrial centers reported a substantial percentage
of vacancies because unemployed families were forced to double up. As employ-
ment increased in these industrial localities many families undoubled, creating
a great demand for rental units. Marriages had been deferred during the depres-
sion ; with the opening up of employment possibilities, there were more marriages
and a greater demand for separate dwelling units. The supply of available
houses was inadequate because new construction had been sharply curtailed dur-
ing the depths of the depression and has only recently revived. Much of available
new construction is for sale, and workers who have just emerged from periods
of unemployment are unable to invest in the purchase of houses.

Steel centers such as Gary, Ind. ; Birmingham, Ala. ; and the towns in Alle-
glieny County ; mai-liine centers such as Bridgeport. Conn. : rubber centers such
as Akron ; automotive centers such as Pontiac, Mich. ; metal-manufacturing
centers such as Dayton, Ohio, and South Bend, Ind. ; aluminum centers such as
Massena, N. Y. ; brass centers such as Waterbury, Conn. ; electrical industry
centers such as Schenectady, N. Y. ; all have revealed similar rent movements.
None of the shortages resulting in higher rent levels in these areas has been
counteracted by an adequate supply of new construction. There is every reason
to suppose that unless controls are imposed, the upward rent movement will
continue.

Towns adjacent to camp sites have been among the localities which show the
greatest frequency of increase as well as some of the highest percentages otf
increase. In Alexandria, La., near Camp Beauregard, for example, 65 ijercent of
the white rentals and 48 percent of the Negro rentals increased between March
1»40 and May 1941 ; in El Paso, Tex., near Fort Bliss, 65 percent of the white
rentals and 29 percent of the Mexican rentals increased during the period from
the fall of 1939 to April 1941. For units which showed increases, the average
rise was 35 percent for whites and 29 percent for Negroes in Alexandria, La.,
and 15 to 20 percent for whites and Mexicans in El Paso, Tex. These instances
are typical of what is occurring in cities and towns near military establishments
when the number of men stationed at the post is two to three times the total
population of the adjacent community. As soon as work on the camp site is
begun there is a vast influx of construction workers as well as families of officers
and enlisted personnel all competing for a very small number of available dwell-
ing units.

As a result, officers and enlisted i>ersonnel who have brought their families
are often constrained to expend more than the regular allowance granted
them by the Army for accommodations. Soldiers without income from addi-
tional sources are forced to house their families in substandard dwellings
because they cannot afford to pay prevailing rents for units in good condition.
In some instances this has had a deleterious effect upon their morale. Letters
of complaint received by Government officials from families of enlisted men
bear out the unfortunate effects of exorbitant rent increases in camp-site
areas. Charges of profiteering made against townspeople create friction be-
tween soldiers and older local residents.

The absence of a ceiling on rents in these areas results in competitive bid-
ding among officers which raises rents for available dwellings in good con-
dition to double and triple their former rental. The Army has attempted to
curb this practice, which tends to raise the over-all rent level in the com-
munity. It has appointed billeting officers in some areas and ordered men to

gg32 WASHINGTON HEARINGS

rent units only through a registration service. This procedure has had some
salutary effect, but it has by no means put an end to competitive bidding for
housing accommodations.

Substantial sections of the older residents of these camp-site areas have not
enjoyed any increase of income as a result of the new influx of population
and the new defense activity. This group includes people on relief, clerical
workers, and others with small fixed incomes. As revealed in the surveys of
these camp-site areas, the rent increases cover from one-half to two-thirds of
all residential units. Since officers and enlisted men as a group include all
rent ranges in a community, the pressure of their demand is felt by all strata
of the civilian population. Reports have been received that older residents
are forced to leave communities in which they lived for many years and to
seek ramshackle dwellings in the surrounding areas because they cannot pay
the rent increases demanded of them. Such conditions obviously have had a
bad effect upon the morale of the civilian population near military establish-
ments.

MALPRACTICES WHICH ACCOMPANY RISING RENTALS

Reliable reports and complaints made to the Office of Price Administration
and Civilian Supply indicate clearly that unregulated rents in areas where there
is no longer a free market have led to many undesirable practices, among them
forced .sales to defense workers and the eviction of persons on relief. Tenants
are threatened with eviction imless they purchase properties in which they
previously had rented dwelling units. These properties are often in poor con-
dition, and the price exacted is exorbitant. Relief workers and persons on
home relief are now faced with eviction in many defense areas because they
cannot pay increased rentals. Since there are no other available rental units
in the area, they are forced to move into hovels. They can under no circum-
stances leave the community because they would lose their relief status.
These people at the bottom of the economic scale have, as revealed by official
rent surveys, suffered the greatest hardship from rent increases.

RENTS, WAGES, AND LABOR TURN-OVER

Divergent movements in the rents of different defense areas devoted to the
same basic industry may exert a negative influence on attempts at wage
stabilization .such as the coastwise agreements in the shipbuilding industry.
When rent increases seriously affect the real wages of workers, they may
upset previous wage agreements.

The direct effect which rent increases have upon excessive labor turn-over may
pot readily be recognized, but it is clear that they tend to exaggerate the ill effects
of inadequate housing facilities. Housing .shortages as the cause of a high per-
centage of labor turn-over in the last war have been studied in great detail.
Workers moved from one defense area to another in search of decent living
quarters at reasonable rents, and the time spent in migration was a total loss to
the war effort. Wages being equal, unless there is a ceiling over rents, workers
will continue to move to new areas in search of reasonable rentals. They may not
be informed about equally bad rental conditions in the area to which they migrate.
The immediate grievance will nevertheless encourage them to move. The waste
involved in periodic transfers of this nature is obvious. If rents in defense areas
are stabilized, this loss will be prevented.

FAIR RENT COMMITTEES

There is a Rent Unit in the Price Division of the Office of Price Administration
and Civilian Supply which at present is dealing with acute rental situations in
defense areas on a voluntary basis. Members of the field staff are sent into those
communities where surveys have revealed the most serious rental problems.
Frequently they go as a result of a direct request from local officials. The field
representative helps municipal authorities and the local defense council establish
what are known as fair rent committees. Certain fundamental principles of pro-
cedure for rent regulaton on a voluntary basis are outlined to the authorities.
After the fair-rent committee had been appointed by the mayor, it publicly
points out the dangers of exorbitant rentals and .sets up an office to receive
tenant complaints. These complaints are examined and cases are selected for
mediation. The landlord is suninioiipd to a hearing to explain the increase, and
the committee, after considering a variety of factors, makes a specific recom-

NATIONAL DEFENSE MIGRATION 6633

uieudatiou. The actual power of the fair-rent committee is dependent upon the
degree of public support which it enjoys in a community. Some 12 such com-
mittees are now functioning in the following municipalities : San Diego, Calif. ;
South Bend, Ind. ; Norfolk. Newport News, Hampton Roads, Portsmouth, and
Virginia Beach, Va. ; Wilmington, N. C. ; Columbus, Ga. ; Sylacauga, Talladega,
and Mobile, Ala.

This method of procedure on a voluntary basis has certain patent limitations.
Voluntary control may succeed temporarily in restraining upward trends; it lacks
the authority to reverse such trends. Ultimately the authority of law will have
to be invoked to curb rent increases in those areas where voluntary methods are
only partially successful.

Exhibit B — Organization of a Fair Rent Committee

statement of office of price administration and civilian supply

office for emekgency management, washington, d. c.

Bulletin No. 1

The Presidential order of April 11, 1941, establishing the Office of Price Ad-
ministration and Civilian Supply defined among its functions the development
of programs with the object of stabilizing rents.

In recent months exorbitant rent increases have accompanied housing short-
ages in certain defense areas. An undue burden has thereby been placed upon
defense workers, upon families of enlisted men and civilian personnel attached
to military establishments, as well as upon other civilian residents of these
communities.

In order to assure the stability of rents, defense communities should proceed
to the establishment of fair rent committees. The Price Division of the Office
of Price Administration and Civilian Supply is prepared to send representatives
into the field to aid local communities in setting up such committees and to
advise in the efficient fulfillment of their objectives.

ORGANIZATION AND FtTNOTIONS OF THE FAIR RENT COMMITTEE

A. Organization.

The fair rent committee should be an independent unit appointed by the mayor
or other responsible municipal authority.

The committee should be composed of persons known for their good judgment
and fairmhidcduess and trusted by all groups in the community.

In addition to official members of the committee, there should be included as
consultants :

1. The local sanitary officer or building inspector, or both, depending upon

the local machinery for the enforcement of health and safety ordinances ;

2. The local welfare or public assistance officer ;

3. A representative of the homes registration office, where this service exists.

Municipal departments and local branches of Government agencies such as the
National Youth Administration and the Work Projects Administration should be
called upon to lend clerical and technical assistance to the committee.

B. Functions.

It is recommended that a fair-rent committee adopt the following course of
action :

1. Upon organization issue a public statement urging landlords to maintain

rents at the preemergency level. Announce the most recent date on
which fair rents shall be regarded as having prevailed in the com-
munity.

2. Secure full and accurate information on all aspects of the local rent

problem. The Office of Price Administration and Civilian Supply will
arrange for the conduct of formal rent surveys through the cooperation
of technically competent Government research agencies. Surveys are
now in progress in more than 100 communities, and others will be
undertaken upon request.

3. Upon the completion of an official survey, publicize the findings and draw

appropriate conclusions.

5534 WASHINGTON HKA KINGS

4. Invite the general public to file with the committee specific complaints

against rent increases. In instances where there is substantial evi-
dence of profiteering, request both the tenant and the landlord to fill
out appropriate forms describing the case at issue. These forms should
be available in the permanent office of the fair-rent committee.

5. When cases are selected for negotiation, summon the parties concerned

to a hearing.

6. The cardinal principle in judging each case is the maintenance of rents

at the preemergency level. Increased costs in services since the dec-
laration of the emergency should be taken into consideration.

7. Should either party refuse to accept the mediation of the fair-rent com-

mittee, it may choose to present the facts of the case to the general
public.

8. The field representatives of the Price Division of the OflSce of Price

Administration and Civilian Supply will confer with the fair rent com-
mittee at regular intervals in order to keep them informed about
current methods and procedures in effect in various communities
throughout the country.

9. The committee in turn should communicate with the Price Division of

the Ofiice of Price Administration and Civilian Supply, in reporting
on the success of its efforts in maintaining fair rents.

It is the expectation of the Price Division of the Ofiice of Price Administra-
tion and Civilian Supply that fair-rent committees will succeed in curbing
rent increases in most communities. Should these methods fail of their pur-
pose it will be recommended that available legal steps be taken to control rents
in these areas.

Fair Rent Committee

Bulletin No. 2

The Office of Price Administration and Civilian Supply suggests that a fair-
rent committee adopt the following procedure:

DETERMINATION OF A FAIR-RENT DATE

After reviewing the facts presented in the official rent survey for the locality,
and after gathering data in an informal manner from qualified citizens, the com-
mittee should establish a date, not further back than October 1, 1939, which
is known henceforth as the fair-rent date. Consideration should be given to a
date on which rent levels had not yet been seriously affected by defense
activities in the community.

It may be convenient to establish January 1 of the year in which the com-
mittee is formed as the fair-rent date.

When such a date is determined it should be widely publicized. It should
also be stamped on the forms provided.

FILING OF TENANT COMPLAINTS

By an official statement in the local press the committee should make known
in the community that it will receive complaints from tenants, roomers, and
lodgers whose rent has been increased above the level of the fair-rent date.

At the same time the committee should announce the address of its offices and
provide a telephone and a full-time office secretary to receive complaints.
Municipal departments and local branches of Government agencies such as the
National Youth Administration and the Work Projects Administration should
be called upon to lend clerical and technical assistance to the committee.

It is recommended that tenants and roomers file their complaints on Forms No.
1 and 2. These are simple reports which furnish the committee basic informa-
tion on the dwelling unit or room involved.

SELECTION OF OASES

Forms No. 1 and 2 are examined by the committee and, as a matter of expe-
diency, the most apparent cases of serious rent increases are selected for first
consideration. By "serious increases" is mean cases in which the percentage of
increase is relatively great. A comparatively small dollar increase on a low-rent
unit may mean a iiigh percentage of increase.

NATIONAL DEFENSE MIGRATION 6635

The committee should then invite the landlord to appear for a hearing on a
specified date. Either prior to or at the hearing the landlord fills out Form No. 3
or 4, entitled "Landlord's Report on Tenant Complaint" and "Landlord's Report
on Roomer or Lodger Complaint."

THE HEARING OF INDIVIDUAL OASES

At the hearing the committee should call upon the landlord to present his
reason for the rent increase against which complaint has been filed. It should
also secure further information from the tenant or other interested parties.

A variety of arguments will be presented to explain the rent increase asked by
the landlord. It is recommended that the committee do not accept the following
considerations in judging a particular case :

1. The income of the tenant and any change in the income of the tenant
which may have occurred since the fair-rent date. This is a problem not directly
relevant to the tenant-landlord relationship. If landlords or tenants seek to
introduce this factor into the discussion, the fair rent committee should adopt
a definite attitude on this subject; the income of the tenant is not pertinent
evidence.

L'. Return on original investment. If the committee is to function success-
fully and to cover a substantial number of cases, it is not practicable to enter into
the elaborate analysis involved in any judgment of return on original investment.
There is moreover no reason why the tenant should be affected by the wisdom or
lack of wisdom exercised in the original purchase of the property.

Excluding these two factors, the committee should judge each individual case
on its merits. Landlords will frequently raise problems of increased costs of
taxation and services incurred since the fair-rent date. The committee should
suggest that increased costs, if added to the rent, be spread over a reasonable
length of time.

THE committee's RECOMMENDATION

When both the landlord and the tenant have had an opportunity to present their
sides of the case, the committee should make its recommendation. This recom-
mendation should be communicated to the landlord with the request that he in-
form the committee of his position.

Should the landlord comply with the recommendation of the committee, no
further action is necessary except for a formal check on the rental during the
next rental period.

FURTHER ACTION IN CASES OF NONCOMPLIANCE

Should the landlord refuse to comply with the recommendation, the committee,
at its discretion, may proceed to make public the facts of the case.

The committee should also communicate its recommendation to the local
homes registration office which, in accordance witli an agreement between the
Oflice of Price Administration and Civilian Supply and the Division of Defense
Housing Coordination, will refrain from registering a dwelling unit or room
whose rent is declared unfair by the committee.

If, in the course of the hearing, it appears that existing ordinances with respect
to housing or sanitary regulations have been violated, the committee should
bring these facts to the attention of the proper local authorities.

COMMITTEE REPORTS

The committee should keep a record of its action on form No. 5.

From time to time the connnittee should inform the rent section of the Ofl3ce
of Price Administration and Civilian Supply about the progress of its efforts
by presenting a summary of the disposition of various cases on a schedule which
will be provided for this purpose.

TESTIMONY OF LEON HENDERSON— Eesumed

The Chairman. I have read your statement and I think it is very
valuable. Of course, the committee has been interested so far
this session on defense migration. We have been to San Diego,
Calif. ; Hartford, Conn. ; Trenton, N. J. ; and Baltimore, Md. ; and we
are now just simply tying up the loose ends here in Washington.

gg36 WASHINGTON HEARINGS

We never make an attempt to cross-examine any witness. We are
just a fact-finding body and glad to get any information we can.

Congressman Osmers, of New Jersey, will ask you a few questions,
Mr. Henderson.

Mr. OsMERs. Mr. Henderson, will you outline for the committee some
of the rent situations that you are finding throughout the country ?

Mr. Hendeeson. In the first place I would say no thanks are due
from the committee. I coiisider it a privilege to be here because this
problem has been of personal interest to me dating back to the time
when I was with the W. P. A.

RISING RENTS

On the matter of rents. Rents being charged for housing accom-
modations in defense areas have a direct bearing on the many aspects
of labor migration. If defense production is to proceed smoothly
we must be assured the workers are willing to migrate to those areas
where they are needed and when they are needed, and once they have
accepted defense jobs in new localities that their living conditions
and general living facilities are good enough to keep them there
and that if they choose to stay their health and morale will be
maintained.

This problem of housing defense workers was something which the
old Defense Commission saw very early but I think, like in other
things, we didn't raise our sights fast enough. Defense needs, in
other words, grew so rapidly.

Mr. OsMERS. You mean the housing program lagged along with the
defense program ?

Mr. Henderson. That is right.

But I think in fairness I should state tliat instead of waiting as was
done necessitously in the last war, the Defense Commission and the
President gave immediate attention to it, but the program mounted
so fast that probably we should have started with the Defense Com-
mission in some of the matters of prices and rents and housing.

Mr. Osmers. Do you think, Mr. Henderson, more attention should
liave been given to those problems before contracts were let ? I mean
it is so easy to sit here in Washington and negotiate a $200,000,000
contract for some town down in Alabama or some other place, when it
seems to me that there hasn't been enough attention given to the civilian
pressure that is created as a result of those contracts.

Mr. Henderson. Well, as I said, it is obvious from what we are
experiencing now^ in our rent inquiries and our work with defense
areas, that we didn't begin in time nor move fast enough. But there
is a necessary amount of time that has to elapse in getting an or-
ganization and getting the money and making the arrangements.
I wouldn't want to appear to be critical of those in charge of de-
fense housing, but I would say that, along with the rest of us defense
commissioners, they didn't see the problem mounting as fast as it
actually turned out to be mounting and, therefore, in our prepara-
tions— and this is from the standpoint of prices, rents, and every-
thing else — we didn't move fast enough.

Mr. OsMERS. Considering how few of the defense dollars have been
bpent, in proportion to the total that will be spent, that have been

NATIONAL DEFENSE MIGRATION 6637

appropriated, isn't it fair to presume that these problems will become
more acute rather than less?
Mr. Henderson. Most assuredly.

ACTIVITIES OF O. P. A. C. S.

The Chairman. Let me interrupt for just a moment. That is evi-
denced by the fact that the President has asked for $300,000,000 more
for housing.

Mr. OsMERS. And I would say, Mr. Chairman, that with just the
sketchy look that we have had at the situation, $300,000,000 may not
be enough to take care of some of the things we have seen in our
studies.

Now, I wonder if you would outline for the committee, Mr. Hen-
derson, the activities of your office with respect to this rent situation ?

Mr. Henderson. I presume you don't want me to advert to the
printed statement which contains a number of examples which is
placed before you.

Mr. OsMERS. We have included your whole statement in the record.
I have glanced over it and I wonder if you would sum it up for
us — wliat you have done and what you are going to do.

Mr. Henderson. Now, in the setting up of O. P. M. there was a
concentration on getting out defense production. The various
])owers assigned by the Executive order to the O. P. M. were
directly related, of course, to the emergency problem of stepping up
defense and getting the facilities that were necessary. It has been
obvious ever since we began the defense effort that the impact of
the defense program on the civilian population was bound to be
great in this period,

I was talking with Mr. Baruch this week as to the speed with which
some of the problems came on us and it seemed obvious that one of the
reasons is the great increase in heavy mechanical armaments. The
great demand for tanks, airplanes, and huge machines of all kinds, and
their resultant demands for raw materials, is the reason why the impact
on the civilian population comes earlier and perhaps more acutely than
it did in the last effort.

Mr. Osmers. Would you say, in comj^aring this situation to the
World War situation, that in the World War situation we worked up
to the point we are now, gradually from 1914 to 1917, and at a more or
less orderly pace and that it wasn't thrust upon us as it is today ? Do
you think that that pre-war period had something to do with the time
element ?

Mr. Henderson. Most assuredly, but I think that now you get a de-
mand for materials for these mechanical weapons such as did not hap-
pen in the last war — that is, the amount of aluminum that is necessary
for a big bomber is totally unrelated to any kind of a device that was
used in the last war. And for that reason, among others, this impact
on the civilian economy comes more acutely and comes earlier.

For that reason the President set up O. P. A. C. S., the Office of Price
Administration and Civilian Supply, and appointed me as
Administrator.

Our problems are chiefly those of the civilian economy. If we
assume that in the current fiscal year about 20 percent of the Nation's

gg38 WASHINGTON HEARINGS

production of goods and services will be going for the armament pro-
gram, there is 80 percent which is the general range of our sphere of
activity. We have the question of prices as they affect not only the
purchasing which Don Nelson will do for the Army and Navy and
the other forces but we have the responsibility for prices as they affect
all of the civilian buying.

CONSUMER PROTECTION

Now, pretty generally our work falls under the heading of, first,
Consumer Protection. That is under Miss Harriet Elliott, who was
appointed the Commissioner for Consumer Protection in the old De-
fense Commission, and that is a point of contact for consumer organi-
zations throughout the country, and is also a place from which in-
formation directly bearing on consumer problems can go out. And
in addition. Miss Elliott's division sits with our other operating divi-
sions and represents the consumer point of view. When we are estab-
lishing a price for an article for civilian consumption, Miss Elliott's
representative sits right in, in order to make apparent to those people
making the price schedules what the effect on civilians is likely to be.

Mr. OsMERS. Are rents under Miss Elliott's jurisdiction?

Mr. Henderson. No ; Miss Elliott did have rents in the old Defense
Commission, but in the present set-up she has taken over the functions
of an advisory character that I had in the old price commissionership
in the Defense Commission, and continued all her own advisory
relations.

Then the operating units that she had have come over and have
dropped into our Price Division and our Civilian Allocation Division.

For instance, the man that she had on Food Supply is now in charge
of the price unit on Food Supply, but she has a representative who
is working, not only with us but with the Department of Agriculture,
with the Bureau of Standards, and the civilian consumer agencies and
bringing his experience to bear on any price ceilings that we have to
establish in the food line.

PRICE DIVISION

The Price Division is one of the two operating divisions and
there we keep a watch on all the important prices. And I might say
that we have a set-up now which, of course, is far more embracing
than was ever available before. I have had occasion to express my
admiration of what the War Industries Board did in the last war in
the way of control of the upward movement of prices, and that admi-
ration springs somewhat from the greater knowledge of these problems
that we have today — there are so many more facilities for us to work
with.

For example, we get, through our arrangement with the S. E. C.,.
a report four times a day as to the activities of the principal com-
modity markets. That is, we have a running record all the time as-
to what is happening in those markets.

Mr. OsMERS. Now, what authority do you have, Mr. Henderson ?

Mr. Henderson. May I finish ?

Mr. OsMERs. Proceed in your own way.

Mr. Henderson. I left a couple of my divisions hanging over here.

Mr. OsMERs. We don't want to tie them all up with red tape.

NATIONAL DEFENSE MIGRATION 6639

Mr. Henderson. Now, that Price Division is the one that directly
establishes the price ceilings. Then we have the Civilian Allocation
Division. After defense has taken priority on any commodity or any
industry sufficient to fill the orders that have gone oat from the Army
or Navy, we have to make the plans and programs for distributing the
residual supply among the competing civilian needs.

Now, it is obvious, as was announced yesterday, that all of the
aluminum is taken for defense account. There is none available for
civilians and presumably we have no problem, but I can assure you
we still do, from the civilian end, have a problem on aluminum.

However, on copper and zinc, and probabl}^ on 20 more metals, there
is a reduced supi^ly, and that amount has got to be distributed Avliere
it will do the most good for the civilian economy.

Through the Army and Navy Munitions Board, ratings come down
vertically on a commodity and preempt, you might say, a certain
amount of material for prompt use in defense production.

CIVILIAN PREFERENCE FOR ESSENTIALS

We in O. P. A. C. S. have to cut horizontally and our first plans and
])rograms were issued to give a civilian preference to the maintenance
of transportation lines, to the maintenance of the public utilities — to
fire prevention, to public health — that is to the things which are acutely
essential to keep the wheels of the economy running. And then antici-
pating that there will be a reduction in the amount of heavy equip-
ment that is usually made for civilians as, for example, farm equip-
ment and automobiles and refrigerators and all such things, we have
made a rating for repairs.

In other words, we have said in our plans and programs that since
there will be this reduced amount of new mechanical goods available,
it is highly essential that the garages and the repair shojjs of all kinds
are assured of a full flow of materials if there is anything left. It
is not until we get beyond the satisfaction of those urgent needs
that Ave get into the question as to how much a civilian industry can
have of this residue.

I might say that that is probably the most acute problem that we
have right at the present time. There is no parallel for that type of
an operation.

CIVILIAN SUPPLY

We also have a general assignment of civilian supply which we have
not departmentalized. I just came from a meeting which Ed Stet-
tinius had called with the copper producers to discuss with them
how we could get an additional amount of copper production.
We work in that civilian-supply function to try to get an increase in
the amount of materials and facilities that would be available to con-
tinue the civilian industries, some of which are going to be very
drastically cut.

It is not only a matter which concerns employment but it is a matter
of high concern to me with respect to inflation. We are getting an
increasing volume of purchasing power being poured out into the
system, and people have been hungry for good^ of all kinds. As a
result the consumer demand has been greatly stimulated and will con-
tinue to be. Well, if for reasons of urgency we have to cut down on

60396— 41— pt. 16 22

QQ^Q WASHINGTON HEARINGS

civilian production it is obvious you are going to have a larger amount
of purchasing power in the system trying to make its claims to the
shortened supply of goods.

What I have really done in that sentence is express the classic
definition of inflation. That is, a greater volume of purchasing power
than the supply of goods. That is what gives rise to the bidding up
of prices.

Now, we also have some auxiliary functions, including a legal divi-
sion, which has charge of the work of enforcement and the legal ques-
tions, but that in the main is my organization.

Mr. OsMERS. Well, that is a very complete description of your
function.

AUTHORITY OF O. P. A. C. S.

Now, getting back again to that question I asked you before, what
authority, what real authority, does O. P. A. C. S. have ?

Mr. Henderson. I am glad you asked that question. We have the
same authority in O. P. A. C. S. as the War Industries Board did in the
last w^ar. The authority arises from the President's emergency powers
and his obligation, of course, under the Council of National Defense
Act, to maintain the kind of balanced economy in which you can get
production and keep the people's morale up and the general economy
going.

Now, that authority — the authority to fix prices under that emer-
gency power — was never challenged during the last war. The War
Policies Commission, the Nye committee, the Cn-aham connnittee, and
several others have reviewed the activities and never have they for
one minute criticized it.

In th.e last war, except for food under the Lever Act, which was
knocked downi for a constitutional reason not related to the right under
an emergency to fix prices, but for other reasons, no specific authority
was granted to the War Industries Board or to the President for the
fixing of prices, such as for copper and zinc and lead and others.

The sanctions, however, were indirect sanctions, and when Baruch
and Brookings, who ran the Price Fixing Committee, found a recalci-
trant they exercised other powers which were available to them, such
as shutting off of transportation, and they also held the power of com-
mandeering in order to fix the price.

Now, all those powers are available to us and others besides, but
wliere the question has risen to the extent that it has risen, it has been
that there is no specific congressional statute, and therefore the penalties
do not run to the violator directly.

POWDER TO FIX rents ?

Mr. OsMERS. You mean that they have to be applied through the
back door, so to speak ?

Mr. Henderson. That is correct.

Mr. OsMERS. Through pressures and clubbing, if you want to call
it that, to make people comply.

Mr. Henderson. I have had complaints that I haven't used the club
enough.

Mr. OsMERS. Does your office at the present time have the power to
fix rents ?

NATIONAL DEFENSE MIGRATION 6641

Mr. Henderson, I think that if there were a situation in a strictly
defense area which was of an acutely clemoralizino; nature, that we
would have the same authority in that area to establish a ceiling on
rents as we do on prices.

Mr. OsMERS. Is there such a thing as a "purely defense locality" or
"area"?

Mr. Henderson. Well, as far as housing goes you know the Presi-
dent can spell out an area, and I should say that that brings it within
the emergency powers of control.

Mr. Osmers. Well, would you be able to fix rents in an area like the
Baltimore area, for example, which this committee visited 2 weeks
ago?

Mr. Henderson. If you ask me if we have the power, I think that
the sovereign power of che Federal Government does have authority
to handle any kind of an emergency situation.

Mr. Osmers. I am not questioning the sovereign power of the Fed-
eral Government. I mean does O. P. A. C. S. have the power to fix
rents — that is the question.

Mr. Henderson. On the matter of power I would say, "Yes"; on the
matter of having anything which was available to do a complete job
and a correct job, I think not.

more legislation necessary

Mr. Osmers. You think that further legislation is necessary ?

Mr. Henderson. Absolutely And we have, as you know, been
M'orking with the House District Committee on the preparation of the
Randolph bill for rent control.

Mv. Osmers. Will that apply only to the District of Columbia?

Mr. Henderson. That will apply to the District of Columbia ; yes.

Mr. Osmers. Well, how about the people that live outside of the
District of Columbia that are being abused probably just as badly
as they are here?

]Mr. Henderson. As. for example, in San Diego, and places like
that^

JSIr. Osmers. Any place you would mention.

Mr. Henderson. Well. I Avould think that either with concurrent
legislation or treated separately, that there will have to be legisla-
tion for rent control in these defense areas.

Mr. Osmers. Would you say that rent fixing, or rent control, or
whatever we might call it. should take the effect of adopting a cer-
tain time or month — some particular month of some year as a normal
and adhere to that, or would it be adjusted to various situations?

Mr. Henderson. I think a combination of a base period with
proper adjustments, with justifiable increased costs taken into ac-
count, would be the fairest way.

Mr. Osmers. For example, this committee has had instances, many
of them, of a changed type of occupancy. In other words, we would
hear of a house that rented for $30 a month for one family, but
now it is a rooming house with 12 people in it paying $4 a' week
each, or something like that. With a changed type of occupancy,
any division of tlie Government that would seek to establish a fair
rent base would have to study that particular situation. I mean,
they could not apply any rule of thumb and no one could say it

QQ42 WASHINGTON HEARINGS

should rent for $30 a month this year, because it ceased to be a one-
family house.

Mr. Henderson. I would agree to that, and I would say further,
that any type of control of prices or rents will fall down if it has to
be based upon some arbitrary factor as a base period or an index
number. The only way that I know to make a price schedule or a
price ceiling work is to do what we call "price administration" after
the establishment of a level, to provide for unusual circumstances,
such as the hardship cases, an increase in cost, etc. In every one of
the price schedules that we have established, and it would seem to me
it would be true of rents, we have undertaken immediately to carry
forward a study as to how that price operated whether there were
hardship cases and when they have been established by fact we have
made the adjustment.

I think that would certainly be true of any type of rent control.

COTTON -GOODS PRICE CONTROL,

Mr. OsMERs. I heard of an isolated instance of the work of your
office. I cannot give you dates, names, and places because I didn't
check into it, but I believe it was in a cotton-goods situation, and
something was selling at 16 cents a yard and I think your office
stepped in and made it 12 cents a yard, and it caused a great deal
of distress.

Mr. Henderson. I think I could give you the particulars of that.

Mr. OsMERS. Because the goods had been manufactured to sell at
16 cents or something of that sort.

Mr. Henderson. We fixed a ceiling on cotton yarn at 42 cents,
and at the time we did it the market had run up to about 52 cents.

Mr. OsMERs. How did you arrive at the 42-cent figure, Mr. Hen-
derson ?

Mr. Henderson. We arrived at the 42-cent figure by considering
the cost of the raw material and the mill margin. It is customary
in the textile industry to separate the cost of cotton from the total
price and that gives you the mill margin, and that mill margin that
we set was a margin that had not prevailed in the industry for a
long time and we were satisfied that it was a reasonable margin
which would allow a profit to the producers.

Mr. OsMERS. Was it a larger margin than had prevailed in the
industry for a long time?

Mr. Henderson. It was a larger margin than had prevailed in
the industry for a long time, but it was a smaller margin than they
had been getting due to the recent inflationary tendency in that par-
ticular construction of cotton yarns.

EFFECT OF COTTON PBICE FIXING

Mr. OsMERS. Taking that particular instance, what was the prac-
tical effect of that particular fixed price? Is it working out?

Mr. Henderson. Yes; it is working out.

Mr. OsMERS. Is it causing any real distress that you have found
in any particular?

Mr. Henderson. We have made some adjustments in individual
hardship cases and we are considering all the time what has been

NATIONAL DEFENSE MIGRATION 6643

the effect of the rising price of cotton on this margin. That same
thing is true with the cotton textiles in which a price ceiling was
established more recently.

It always takes a little time to make those adjustments. Now,
we were at work for 3 or 4 months studying the cotton textile print
cloth ceilings and when we established them we immediately struck
a market for the raw material — cotton — which was advancing, and
we are in the third day now of discussions with the cotton textile
industry as to changing costs.

We make changes as far as the individuals are concerned on the
proper establishment of facts and we make changes in the whole price
on the establisliment of facts.

Mr. OsMERS. Do you in any way attempt to fix any of the costs that
went into material other than this mill margin — I mean like the cotton
or the mill work ?

Mr. Henderson. No.

Mr. OsMERS. Or labor or any of those things, or transportation?

Mr. Henderson. No. We didn't attempt to do that. We made
a price based upon a liberal price for their raw material, an adjust-
ment necessary for the wage-and-hour law going into effect in that
industry and then a substantial margin.

HARM DONE BY RENT RISES

Mr. OsMERs. Now, getting Back to the rent situation for a mo-
ment : Do you feel that the defense program has been harmed directly
because of this rent situation?

Mr. Henderson. Yes, sir.

Mr. OsMERs. In other words, this committee being primarily in-
terested in the migration that has taken place and will result from
the program, we have seen instances where workers have been pre-
vented, actually prevented, from migrating to a defense job because of,
first, a lack of housing generally and, secondly, the high cost of
housing.

Mr. Henderson. Don't you- think, Mr. Congressman, that the pro-
duction of individual workers is tied pretty directly to their morale
and their morale is tied to their living conditions ?

Mr. Osmers. Without any question. It is so obvious to this com-
mittee. We have had these ])oor, miserable people that come with
their families 1,000 miles and they are doing their job, but there aren't
road facilities to get them to their work and there aren't any
places for them to live; no schools for their children, and certainly
their morale has been harmed.

Now, would you just outline briefly — you mentioned it in your
statement — what rent reduction efforts your organization has made
thus far and what form those efforts have taken?

Mr. Henderson. We have a rent section and we had previously,
in Miss Elliott's division and in my division of the Defense Commis-
sion, worked out a proposed or suggested type of State law for the
regulation of rents, which has been available to the various States, none
of which, however, have adopted it.

Mr. OsMERS. In brief, what is the form of that ?

5544 WASHINGTON HEARINGS

REMT ADMINISTRATION

Mr. Henderson. It provides for a rent administration which is
able to establish ceilings and to hear complaints and g:ives it au-
ihority to punish violators and makes a provision for appeals in the
proper manner. It is a fairly simple statute but the main part of
the effort has been through our field representatives who go out to
the defense areas where there are acute situations and work with
local officials and civilian groups in setting up voluntary Fair Rent
Committees.

These field men are well versed in what the experience has been in
other areas and they bring that to the communities. Now, I don't
know how many of those we have right at the present time but my
guess is that we are participating in such efforts in about 15 areas.

Mr. OsMERS. Are those efforts successful?

Mr. Henderson. I think that they exercise a restraining influence.
I am quite sure that in some of the towns in Indiana and in the
Norfolk area that there would have been runaway rent situations
if the citizens had not established that kind of a mechanism.

Mr. Osmers. But the only force behind those committees is the
force of public opinion, is that correct ?

Mr. Henderson. That is correct.

Mr. Osmers. And no compulsion at all?

Mr. Henderson. That is correct. However, and I don't want to
mention the name of the city, but there is one city w4th which we are
working that has found some indirect sanctions in order to make
their suggestions effective.

INDIRECT SANCITONS AND PRESSURES

Mr. Osmers. As a matter of future policy, do you believe that this
Government, through this emergency, should deal with indirect sanc-
tions and pressures and all that sort of thing, or should we face the
problem directly and either deal with it through legislation or fail to
deal with it, as the case may be, but anyway, deal with it from an
lionest government standpoint. What is your opinion ?

Mr. Henderson. I am sorry you put it on the basis of "honest gov-
ernment." I think it ought to be approached directly; but let me say
this : From my studies of the enforcement of the price schedules, which
the War Industries Board got out, it seems to me that when you have
an emergency and when a need is very clear and you have a conflict,
that the sovereign power of the Government does have a right to use
indirect sanctions in order to get observance of something which is
recognized and accepted by the community as necassary in that
emergency.

From the standpoint of administration, from the standpoint of
clarity, from the standpoint of protection of an individual's interests
in the noi-mal method of his right to appeal, however, it seems over-
whelmingly clear to me that you ought to attack the problem directly.

Mr. Osmers. But it seems to me — and I agree with what you say
about the obviousness of it and the public desirability of bringing
these things about — you do build up a series of practices that in the
long run really strike right at the heart of democracy if you use these

NATIONAL DEFENSE MKiRATION 6645

indirect sanctions and pressures. Sometimes they are abused and
that is not publicly desirable.

Mr. Henderson. I should hate to see — to take an absurd condition —
that when an owner of an industrial plant violated a speeding law
that he would have an embargo on all boxcars coming into his plant
as the penalty. I think the penalty ought to be tied directly to the
violation.

Mr. OsMERs. I think we are substantially in agreement on that.

DEFENSE INDUSTRIES OVERCONCENTRATED

Now, do you feel that we have concentrated our defense industries
too greatly or not ?

Mr. Henderson. Categorically, yes.

Mr. Osmers. Do you feel that the present tendency will have a great
deal to do with the migration problem? Do you feel the tendency
now is more toward concentration or less toward concentration?

Mr. Henderson. I haven't looked into it in detail as I did when I
was on the Defense Commission. I can say this, that it is obvious
that earnest attention is being given to trying to get more decen-
tralized locations. But when you get under pressure to get out or-
ders, as is the case with the Army and Navy procurement agencies
now, it is a natural thing to add to the orders already placed and
that adds to our concentration. Over a period of time the War De-
partment had been building up knowledge of companies who could
convert some part of their facilities to the war effort, and particu-
larly through the ordnance districts they had a pretty good working
knowledge of what those companies could do, and under pressure, as
I say, I think it is a very human thing that they would turn to the
companies that they know.

Mr. Osmers. In the course of its work this committee has visited a
large shipbuilding enterprise and, of course, we realize how acute the
need for ships is. But from the information that we gathered there
it is a lot easier to say that you want to decentralize shipbuilding than
it is to do so. because of the extremely complicated nature of the man-
agement of a shipyard and the key personnel that are required to put a
yard in being, so that we may not be able to do as we might want to do.
In other words we might think it would be desirable to put a shipyard
in Jacksonville but if there was no shipbuilding company operating
there we might hold back the program more than by enlarging an
existing yard somewhere else ; isn't that so ?

Mr. Henderson. That is so. I think, however, if the attitude of
mind on the part of those that give out contracts was 100 percent
directed toward defense, we would get a lot more decentralization.

UNEMPLOYMENT DUE TO PRIORITIES

Mr. Osmers. Now, how much unemployment would you estimate
has been created to date by priorities?

Mr. Henderson. I can't estimate that.

Mr. Osmers. Is it a large number, Mr. Henderson — is it growing
larger ?

gg46 AVASHINGTON HEARINGS

Mr. Henderson. I think that what is happening is this : First, you
fail to get the increase in employment which would naturally come
from the defense orders by reason of priorities, and then I think that
we have gotten some drastic unemployment situations — some of which
I spelled out in my statement because of priorities. But more impor-
tant, however, is what is over the horizon now. We have not cut
through with priorities anywhere near as deeply as we will have to cut,
and whereas we have had new records made in most of the consumer
durable goods that compete with defense items for materials, the pros-
pects for them for the next year is that of pretty drastic reductions.

Mr. OsMERs. Now, in your opinion would it be reasonable to expect
a great number of these displaced workers to migrate about the coun-
try seeking employment opportunities in defense industries?

Mr. Henderson. Yes, and I say that because when these cuts come
as they will at the raw material line

Mr. OsMERS. Then you have a geographical problem ?

Mr. Henderson. Yes ; but there will not be defense orders or non-
competitive things to manufacture immediately available and workers
knowing that there is an acute demand in defense industries for cer-
tain kinds of skills, undoubtedly will migrate. I think we will follow
the pattern of the experience in the last war and I expect to see a
considerable increase in the migratory labor problem.

Mr. OsMERS. Have any acute labor shortages developed to your
knowledge ?

Mr. Henderson. I do not have a working familiarity w^th that.

Mr. OsMERS. But at least to your knowledge you haven't any acute
labor shortages before you ?

Mr. Henderson. No.

Mr. OsMERS. That seems to be rather a debatable question. The
unions say there isn't any shortage but the employers say there is in
some instances.

'•qualitative" SHORTAGE OF LABOR

Mr. Henderson. Isn't it a qualitative shortage? We looked into
one situation just this morning where the employer complained there
was a shortage and the union said there are 800 men available.

But the company had been working, up until recently, on a pretty
low volume of ojoeration and obviously it had kept its best men and
it had certain standards of perfonnance. In fact its wage rates were
geared to production in which only high-grade men were used.

Well, as they attempted to move forward the difficulty of getting
men as highly qualified as those already on the rolls, became pretty
acute and what they were saying is, that although some of these men
may call themselves carpenters, they certainly are not carpenters as
far as the pay roll is concerned. I think you get a qualitative distinc-
tion there which means that you have got a qualitative shortage.

Mr. Osmers. Do you think that this defense program will lead us
to a theoretical full em.ployment before we are through ?

Mr. Henderson. That depends on what the adjustment is, how
rapid tlie adjustment is, in the civilian economy, to the displacement
that is coming about by reason of priorities for materials. Now, in
the first month of its war effort England had, and I don't want to be
held too closely to this percentage, but it seems to me about 25 percent

NATIONAL DEFENSE MIGRATION 5647

increase in unemployment despite all that increased effort — the bend-
ing of every effort to get on a wartime production basis. As I say,
despite that they had a 25-percent increase in unemployment.

Now, if the things that I see in these gloomy several months ahead
actually transpire, then the question of reaching full employment is
going to be postponed.

Mr. OsMEKS. A great deal will depend, I would say, upon the activi-
ties of your office, w^ill it not?

Mr, Henderson. No. Let me put it this way : The displacement is
coming, of course, in the civilian end of the economy by reason of
priorities for defense items. Now, in order for a manufacturer to get
over onto defense and thereby take up employment that has been cut
off on his civilian end, you have got to look to the volume of Govern-
ment orders.

In otlier words, it seems to me that the rate at which the defense
orders that haven't been allocated are put in these plants that are
going to be cut down, is going to determine how much unemployment
we will have by reason of priorities.

FACTORS IN CIVILIAN ALLOCATIONS

Mr. OsMERS. What factors is your office going to take into considera-
tion in determining civilian allocations in order that you make a fair
distribution ?

Mr. Henderson. We are going to, as I said earlier, try to provide
for the public welfare necessarily first, and then we are going to take
into account the repairs and then we want to take into account how
much displacement of labor is likely to be occasioned. For
example, we ran into a situation the other day w^here by merely secur-
ing a small amount of a necessary metal a whole industry could go
forward and obviously that was the thing to do. Then where there
are substitutes available — for instance there would be no substitute
for nickel to be used in some heating element, so obviously that would
be favored as against a company that can go from nickel over to
some other metal or from copper over to cast iron, or can go from
enameling over to a paint job or things like that. Those are some of
the considerations.

I have spelled out these factors in my statement but I would like
to draw your attention to the fact that OPACS was not created
until April 11 and we are breaking entirely new ground and it is an
enormous problem and it is not a very happy one to handle.

Mr. OsMERS. I imagine not.

CUT IN AUTOMOBILE INDUSTRY

Now, do you know the approximate number of people in the United
States who are employed in the automobile industry — roughly?

Mr. Henderson. No; I don't.

Mr. Osmers. It probably runs into several million when you take
into account all of the subsidiary industries that depend upon auto-
mobiles. Now, there is at present a cut contemplated in the produc-
tion of automobiles for next year of 20 percent, is there not?

gg48 WASHINGTON HEARINGS

Mr. Henderson. That was the cut which was announced in May as
a minimum.

Mr. OsMERS. Now, I have a little clipping here from the New York
Times, which you have probably seen, under the date line of July 11,
Avhich is as follows [reading] : , -

"Governor Van AVagoner said today he would ask President Roose-
velt in a letter to block curtailment of automobile production beyond
the 20 percent to which the industry already has agi^eed.

"The 20-percent reduction is scheduled to go into effect with intro-
duction of 1942 models on August 1, and O. P. M. sources have said
it may be increased to as high as 50 percent to free men and materials
for defense production by the automobile industry.

"The Governor said he would forward to the President a report
from the Michigan Defense Council forecasting widespread unem-
ployment and a loss of $15,000,000 a year sales tax revenue in Michigan
if new-car production was cut 50 instead of 20 percent."

Now, the committee is very much concerned with that industry be-
cause if large numbers of people are displaced it will probably start a
mass migration from the automobile areas to every part of the United
States.

I wonder if you can shed any light on the automobile situation ?

Mr. Henderson. Can I start way off here ?

Mr. OsMERS. In your own way, Mr. Henderson.

MUST CUT ALL CONSUMER DURABLE GOODS

Mr. Henderson. It will be necessary to cut not only automobiles but
all the consumer durable goods — electric stoves, refrigerators, vacuum
cleaners, household appliances generally, and that necessity does
not arise from just an idea to cut down.

The thing which will cut down the automobile industry will be the
shortage of material because of its diversion to the defense effort, and
regardless of what the pressures are, regardless of what the employ-
ment considerations are, there is this force at work now which is going
to mean a cut and it seems to me that the consumer durable-goods
industries that are going to be scarce of materials are entitled to know
as fast as they can what the prospects are so that they can make their
plans.

Let me put it this way: The automobile industry is partially an as-
sembly job and the spare parts manufacturers are entitled to know
what is going to be the need for spark plugs, for horns — for the
things that are made outside of the automobile plant. A method of
making a determination fairly early, based on the best information
you have as to what materials are going to be forthcoming for civilian
use, seems to be much more preferable than to allow industries to run
at a mad pace of production now and then come to almost a complete
halt, which could bring about situations in some of these consumer
durable-goods industries, such as in the automobile industrj' and the
rest of them., whereby you would intensify the present situation. The
industries would have expediters out on the road trying to get car-
loads of materials — scarce materials — into their plants so they could
keep on operating.

NATIONAL DEFENSE MIGRATION 6649

Well, pretty soon you would reach a point where there just wasn't
any more material, particularly if the Government enforces its pri-
ority orders.

PRIORITIES MUST BE MAINTAINED

Now the GoA'erimient has so far been very, very considerate, and it
has not really put on the pressure as to the maintenance of the assigned
priorities; but if that situation were to continue it would mean the
defense plants would be out of material, so what I foresee is, and cer-
tainly it is in the i)rogram that Mr. Stettinius has announced, that
there is going to be an insistence in this shortage period that priorities
be adhered to and that there be no diversion for the consumer durable
goods, no matter how powerful their pressures arc-
Mr. OsMERS. I understand now that many of these civilian indus-
tries are doing as you outlined — they have scouts out on the road try-
ing to get this raw material and they are going hammer and tongs,
but in the opinion of your office there should be .more of a rationing,
if I may use that term, over a period of time rather than going up
to a certain point and then cutting it off?

Mr. Henderson. In certain cities having only one industry, a com-
plete shut-down is an additional factor. From our conferences with
the consumer durable-goods people this week I am convinced that
if they are told definitely that "this is your program," they will
accept it most heartily.

Mr. OsMERS. It will apply to everyone in their industry?

Mr. Henderson. Yes, sir; and they will accept it and they will apply
American business ingenuity to make any necessary correction.

I feel also that if that is done the pressure will then be put on the
manufacturer to find competing jobs, to get subcontracts from defense,
toi get contracts from the Government. The pressure from the ap-
propriations that have already cleared and the appropriations that
have not yet been translated into orders, and from the things that
you have seen on the horizon as to the expansion of shipbuilding
and the expansion of utilities and the intensification of the lease-
lend program, particularly if a good job is done in breaking these
programs down into things that can be done by the civilian industries
with their idle equipment, plus the pressure exerted at the other end-
that is, the fact that they can only run 40 to 50 percent — these
pressures will help to repair this dislocation.

But I think as long as you let the thing run there is always that
feeling that you can get the expediters out and you can scrape the
barrel. You can make a deal, as we find from time to time, with, say,
a secondary smelter to get a little ore or you can find a gutter
broker — a black market) somewhere for just enough to keep going.

But we are scraping the bottom of the barrel on some of these
essential materials, and it is about time it stopped. Otherwise we
are going to have not only a dislocation in the consumer-goods indus-
tries but we are going to have a breaking down of defense at the time
when it should go forward at an increased rate.

Everything on the horizon, the logic of events, insists that not only
shall the program be larger but that it shall be moved forward. Needs
are such that the eftort has got to be concentrated on getting things
quicker.

gg50 WASHINGTON HEARINGS

NEW CUT IN AUTOMOBILE OUTPUT

Mr. OsMERS. If we let things run, with the knowledge that you
haven't got enough, there will be an acute impairment of defense as
well as civilian production?

Mr. Henderson. If you translate copper, zinc, brass, steel into
body framesi or refrigerators or vacuum cleaners, you can't translate
it back in order to make bombers and tanks without a great deal of
effort.

Mr. OsMERS. Now, is a further cut in automobile production con-
templated ?

Mr. Henderson. Yes.

Mr. OsMERS. To the 40 or 50 percent that has been rumored in the
newspapers ?

Mr. Henderson. Well, we are right in a series of conferences with
these consumer durable goods industries now.

Mr. OsMERS. Does that include automobiles?

Mr. Henderson. We had the automobile meeting on Tuesday, as I
recall. I think it is the ice-machinery people today. Not until we
get through with all those and match their needs against what defense
is going to leave for civilian account, will we know what cuts we
have to make.

Mr. OsMERS. So, although a further cut is likely, the decision has
not yet been made?

Mr. Henderson. No.

Mr. OsMERS. Now, the reason I asked about that decision is

Mr. Henderson. May I say this : It is obvious that O. P. M., looking
at its serious problem, knows how much of an industry's facilities
and men and managerial power and raw materials it is likely to
have to have to meet the increased program. Now, the O. P. M.
may have, in some of these industries, like automobiles, an idea of
how much they have got to preempt, but after that preemption there
will still be the consideration of how much all of them can get on an
equitable basis, and that is for the determination of O. P. A. C. S.

Well, naturally, we are working back and forth all the time, and
our men sit in the conferences the O. P. M. has and their men sit in
the conferences we have, and we haven't come to a joint determination
yet.

DETROIT HOUSING HELD IN ABEYANCE

Mr. OsMERS. There are two reasons I asked you those questions
about the automobile industry. The first is the effect that the cut, even
the present cut, will have on employment conditions within that in-
dustry, and the second reason I asked you those series of questions is
this :

We understand that the housing program in Detroit has been
held in abeyance pending a decision on automobile production, and
this committee is naturally concerned about that, feeling that no
decision on the housing should be made until they know what the
future of the automobile business is going to be. That is why we are
interested in knowing when that decision is going to be made. Is it
believed to be in the near future ?

Mr. Henderson. On our end ; yes.

Mr. OsMERS. Within a few weeks ot a month?

NATIONAL DEFENSE MIGRATION QQ51

Mr. Henderson. As I testified before, O. P. A. C. S. touches a number
of industries that are not touched directly by defense — that is by way
of placing contracts with them — and I am hoping to get an early
determination because the manufacturers that we have met with have
said one of the essential items for them in this readjustment period is
to have some definite information as to our program. So we are work-
ing day and night to try to get our determination made.

Mr. OsMERS. Now, if it were demonstrated satisfactorily to you and
to your office that a 50 percent cut in automobile production would
lead to tremendous unemployment, would that be a deterring factor
in vour decision?

Mr. Henderson. If I may go back to my previous testimony, I
would say that I would have to put that against what we know is
going to be available in the way of raw materials for that industry,
and once having done that, if there isn't enough to go around we
would have to make our decision accordingly. First, we would have
to consider the needs of the entire civilian sector of our economy, as
our obligation runs to keeping this reasonably well in order. Secondly,
we would have to consider what the seriousness of the unemployment
would be in one industry as against another.

Do you get my point ?

Mr. OsiviERS. You would have to balance the various industries?

HORIZONTAL VIEW OF ESSENTIALS

Mr. Henderson. Yes ; you might say that we have got to look at the
thing horizontally whereas in the O. P. M. they have got to look at cer-
tain heavy goods industries on a vertical basis. They have got to look
and see how far down in steel they have to go ; they have got to look to
see how much of the automobile industries'' men, management, and
facilities they need for this great block of unplaced defense orders.
We have to look at it horizontally from the point of view of mainte-
nance of the economy. That is a natural and logical distinction to
make.

Mr. OsMERS. Now, can you foresee a situation where there might
result, as a result of curtailment in the automobile industry, wide
unemployment ?

Mr. Henderson. Oh, yes.

Mr. Osmers. Yon do foresee that possibility ?

Mr. Henderson. You asked me if I could foresee it?

Mr. OsMERS. Yes : do you foresee it ?

Mr. Henderson. Let me put it this way. If nothing is done the
shortage of materials will make a serious unemployment situation.

Mr. OsMERS. If you just let it run its natural course?

Mr. Henderson. That is right. That has already ha])pened in a
number of towns as far as aluminum is concerned, and I have told of
some of them in my statement, and we know of several others. It was
called to my attention today in connection with farm equi]3ment —
tractors and combines. In one factory, despite the overwhelming
demand, they are down to 50 percent of their production and
they are bound to go further unless something is taken away from a
less essential industry that is now chewing it up. They will have un-
employment, you see.

gQ52 WASHINGTON HEARINGS

RESTRICTION ON COPPER

I am counting on the recognition of the seriousness of this problem
and this big backlog of orders and the ingenuity of American business
and the earnestness of all defense officials to remedy these things to a
certain extent.

We are out for additional copper. We have got roughly, say,
1,000,000 tons of production in this country annually and about a half
a million that we bought from South America, and we could use, on
the basis of the present defense outlook and what consumers are buy-
ing, nearly another half million tons. Well, now, copper on August 1
is going to be restricted very very severely. That means that there will
be a period in there in which the industries having copper as an essen-
tial item will have unemployment.

Mr. OsMERS. Naturally.

Mr. Henderson. Well, now, by using all kinds of ingenuity and
earnestness, ingenuity on the part of the copper producers and the
fabricators and the earnestness of the governm-ental officials — we
might be able to help some during the intervening period, until the
production of copper has increased, but until then and until copper
gets on the market again we are likely to have unemployment. I clon't
see how it can be escaped.

Mr. Osmers. And, of course, that would apply naturally to the
automobile industry the same r.s it would to any other industry.

off-the-record on new legislation

Now, just one more question, Mr, Chairman, that I have in mind,
and then I am through.

What form of legislation do you think this Congress should pass to
assist you, particularly, in your price work?

Mr. Henderson. ]\Ir. Chairman, may I be excused from answering
that question ?

The Chairman. You certainly may.

Mr. Henderson. I am under a binder of silence from several sources.

The Chairman. You might sometime contact the Congressman and
this committee, and we will try to help you. Is there anything else?

Mr. Curtis. How great a personnel would it take to enforce rent
control in the District of Columbia?

Mr. Henderson. I haven't made an estimate on that. Mr. Congress-
man.

Mr. Curtis. Do you have a rough guess at all ?

Mr. Henderson. No; because such time as I have had to devote to
rent has been devoted to getting the legislation in line, and I haven't
talked with my unit on that at all,

Mr. Curtis. What do you propose to do in a case where it is very
agreeable on the part of the tenant and landlord botli, that they violate
the rent control law and have a side agreement to pay more?

Mr. Henderson. Let me go into consultation here.

(Speaks off the record.)

repercussions of cotton price cut

Mr. Curtis. Now, coming back to this illustration that you cited in
connection with cotton. You cut the price from 52 cents to 42 cents.

NATIONAL DEFENSE MIGRATION 6653

Upon whom did that cut i-eflect to any extent — the producer of the
raw cotton?

Mr. Henderson. No. We made that cut when cotton was several
cents lower than it is noA\' but the cotton market is not determined by
the loan rate. That is, if a farmer can get 85 percent of parity as a
loan, he will not sell for lower, and, as you perhaps know, a lot of
cotton which was on loan from last year's crop at a much lower rate
than the market rate is now moving out, and so that cut or that re-
duction that we made did not att'ect a substantial part of the indus-
try's production.

For instance, we had a gradual rise in the price of cotton yarns,
and all of a sudden it turned up, and we cut off from that recent
high price to the previous lower one. Well, that period of order
olacing was vei-y, very short, and none of it had been delivered.

Mr. Curtis. In other words, your price increase had not existed long
enough to consume the excess cotton or to have the price of cotton ex-
ceed the price of the loan?

Mr. Henderson. I think that is correct.

Mr. Curtis. Assuming we did get a price for cotton above the loan
price, a free market on cotton, would such reduction be reflected upon
the producer of cotton ?

Mr. Henderson. You said a "free market on cotton"?

Mr. Curtis. Yes. Pei-haps that is not a well-chosen word, but T
mean that the price would be above the loan value.

Mr. Henderson. You mean what we would do about our schedule?

Mr. Curtis. I want to know if a cut similar to this would not be re-
flected on the groAver of cotton ?

Mr. Henderson. It would be i-eflected first on the margin which
the mill owner has. If the price were kept intact to the extent that
the mill margin was reduced below what the mill owner would accept,
that would find its way back into the demand for cotton in the market
and, of course, would be reflected in a lower price.

But let me point out that the mill niai-gin on the cotton print cloth
had gotten up to almost double what the mill margin had been in some
of the lean years and, secondly, we ai-e committed by policy to appraise
it at a decent price and a price that will reflect the costs. Further-
more, we are committed to a policy of following the congressional
mandate as far as any price is concerned on which they have made a
determination, and that goes for the agricultural products.

I would like to say one other thing as a direct statement, that we
have not at any point with our price ceilings^ directly or indirectly,
affected the market for agricultural commodities, as the experience
of the commodity markets recently would show.

permanency of price-fixing

Mr. Curtis. Now, coming back to this fixing of rents : It would be
about the same task here in Washington as it would be in any other city
of the same size that had a certain amount of defense activity;
wouldn't it?

Mr. Henderson. Yes.

Mr. Curtis. Do you th^nk that that price-fixing machinery, per-
sonnel, and the whole set-up for fixing prices would be abandoned
after this emergency is over or, if we adopt this, it will be here to stay?

gg54 WASHINGTON HEARINGS

Mr. Henderson. I think it would be abandoned and should be aban-
doned when the emergency was over.

Mr. Curtis. How many articles have you undertaken to fix the price
on as yet ?

Mr. Henderson. Eleven ceilings, but the ceilings are not the only
way in which we have affected prices. In some of them we have asked
the producers not to increase their price without consultation with
us and they haven't come around to discuss any increase in pric€.
On others, we have asked them, and this is especially true where there
are a small number of producers in an industry, not to raise their
prices. Several industries have that kind of an informal arrangement
with the Government.

In each of those cases that understanding runs directly from the indi-
vidual producer to the Government.

And so, while we have 11 ceilings we have a large part of the
various basic materials under some kind of a dampening effect. That
is true of oil. As you perhaps know, refineries in the East and the
other areas have agreed with us that they would not raise the price
without consultation with us.

There is no formal ceiling, for example, on copper yet, but the pric«
of copper has not varied very much since September of last year by
reason of a very fine working arrangement with the leading producers
in that industry.

Mr. Curtis. You stated a while ago that you felt that the Federal
Government, through its inherent sovereign power, had authority to
do whatever is necessary within certain limitations, during the period
of emergency. Referring particularly to the price-fixing authority,
in whom do you think that sovereign power rests ?

Mr. Henderson. The President. I think it is very clear that it is
with the President and I have a memorandum on that which I will be
glad to supply to any or all the members of the committee.

The Chairman. We would like to have it.

(The memorandum referred to appears below:)

Exhibit C — The Present Price Controt. Authority of the President and the
Office of Price Administration and Civilian Supply

I. Nature of the price schedules and objections thereto.
II. Summary of underlying authority.

III. The Authority to issue price schedules in the present emergency is sup-
ported by the Executive powers of the Presidency and the commandeering
and other statutes addressed to the emergency.

A. Exercise of the authority during 1917 and 1918.

B. Executive powers of the President.

C. Congressional acceptance of the President's exercise of authority.

D. The reenforcement provided by recently enacted statutes, such as

the commandeering statute, including the adoption of the 1917-18
practice.

IV. Price stabilization activities.

V. Conclusions.

Appendix A (steel price-fixing order, War Industries Board).

I. NATURE OF THE PRICE SCHEHJULES, AND OBJECTIONS THERETO

This memorandum is submitted in response to your request for a written
opinion regarding the legal authority of your Office, and summarizes the many
discussions we have had on the subject. We have always recognized, or course,
that the most effective force behind the actions we have undertaken is the

NATIONAL DEFENSE MIGRATION 6655

widespread understanding of and sympathy for our single objective — the avoid-
ance of dlKsastrous inflation. Without this public acceptance, sanctions, and
penalties of whatever nature would be quite useless. Accordingly, our constant
policy has been to rely chiefly, for enforcement of our price schedules, upon
the patriotic response of business, and upon an enlightened and informed
public opinion. Similarly, our approach to the problem of price control has
been conditioned by the knowledge that with an adequate supply of materials
and commodities formal controls, ever to be minimized, might be wholly
avoided.

Nevertheless, statements have recently been made that the price schedules
issued by the Administrator of the Office of Price Administration and Civilian
Supply are without lawful authorifv. It has likewise been stared that there is
no authority for Executive Order No. 8734, dated April 11, 1941, establishing
the Office of Price Administration and Civilian Supply and, in section 2, author-
izing that Office and the Administrator thereof to —

(«) Take all lawful steps necessary or appropriate in order (1) to pre-
vent price spiraling, rising costs of living, profiteering, and in-
flation * * *.

(c) Determine and publish, after proper investigation, such maximum
prices, commissions, margins, fees, charges, or other elements of cost
or price of materials or commodities, as the Administrator may from
time to time deem fair and reasonable ; and take all lawful and
appropriate steps to facilitate their observance.

In our judgement there is lawful authority for the price schedules and the
Executive order.

On May 29, 1940, the President designated the members of the Advisory Com-
mission to the Council for National Defen.se and created a Price Stabilization
Division charged with directing efforts at price stabilization in the raw n'ateral
field. On April 11, 1941, the President created the Office of Price Adm'nistra-
tion and Civilian Supply. On April 15, 1941, the Administrator of the Office of
Price Administration and Civilian Supply adopted as his own the actions, includ-
ing the price schedules, of the Price Stabilization Division.

There is set out below (point IV) a synopsis of the activities of these two
agencies, including in one aspect the issuance of six price schedules.'

T]]o price schedules direct buyers and sellers of the designated commrd'ties
to comply with specified "ceiling" (maximum) prices. It has been objected that
the price schedules are issued without authority because they are not ai^thorized
by any statute. In considering this objection, it should be noted that the price
schedules are not termed "orders,'' and do not purport to carry penalties for
infraction. Penalties can be imposed only by Congress. In the event of refusal
to compl.v. the Office of Price Administration and Civilian Supply has stnted
that it will make every effort to assure (o) that the Congress and the pubpc
are fully informed; and (b) that the powers of the Government are fully
exerted in order to protect the public interest.

The objections referred to above are raised at the threshold — to the issuance
of ceiling price schedules — rather than to any action taken in support thereof.
Obviously, the authority behind enforcement, even in the extreme possibility
of commandeering a plant, would depend upon the action taken and the circum-
stances, and cannot be discussed in vacuo.

It is submitted that there is authority to issue the ceiling price schedules. L^'St
this be misunderstood, however, it may appropriately be stated here that the
existence of power to enter upon a program of price stabilization in the absence
of specific congressional authorization by no means suggests the impropriety of
legislative action by Congress. Indeed, such action might well be desirable since
it would provide sanctions less drastic and more direct than those presently avail-
able, and would enable the Office in other ways to provide assurance to the great
majority of businessmen who have voluntarily chosen to cooperate that they
will not be i)enalized by the recalcitrance of a few selfish profiteers. Obviously

1 Price schedule No. 1. relating to second-hand machine tools, Issued February 17, 1941 ;
release No. PM 76. Price sc'^edule No. 2, relatina: to aluminum scrap and secondary
aluminum ingot, issued March 24, 1941 : release No. PM 186. Price schedule No. 3. relating
to zinc scrap materials and secondary slab zinc, issued March 31, 1941 ; release No. PM 219.
Price schedule No. 4. relating to iron and steel scrap, issued April 3. 1941 ; release No.
PM 226. Price schedule No. 5. relating to bituminous coal, issued April 2, 1941 (and
revoked May 1, 1941) ; release Nos. PM 228 and PM 351. Price schedule No. 6, relating to
iron and steel products, issued April 16, 1941 ; release No. PM 279.

60.396— 41— pt. 16 23

6656

WASHINGTON HEARINGS

II. SUMMARY OF UNDERLYING AUTHORITY

Congress may pass such a statute, or, in the eveut that Congress does not favor a
vigorous program of price stabilization, prohibit such action.

There is a national-defense emergency today. Although production is the
Nation's primary concern, avoidance of spiraling prices and inflation is likewise
necessary if the most effective use of all our resources is to be achieved. Price
stability facilitates concentration on production ; instability disrupts production.
Price stability braces civilian and labor morale ; instability and rising living
costs lead to labor disturbances, stoppages, and widespread resentment against
profiteering. Price stability will enable us to survive the emergency ; instability
and inflation nurtures the enervating fear of a post-emergency deflation."

The announcement of ceiling price schedules of the kind described above is
part of the px-ogram to assure the best possible defense of thy Nation and the most
efiicient use of our resources. For the same reasons President Wilson and the
agencies designated by him, including the War Industries Board and the Price
Fixing Committee, announced maximum prices in 1917 and 1918 without specific
statutory authorization.

The authority underlying the issuance of ceiling price schedules is derived
from (1) the implied constitutional powers of the Chief Executive during a
period of emei'geucy, and the obligation of the President "to take care that the
laws be faithfully executed," and to integrate in sound defense policy the
administration of the laws providing for the coordination of our industrial
resources, including the laws providing for commandeering, and the law author-
izing priorities for defense production; (2) congressional acceptance of such
exercise of Executive authority, which was fully disclosed to congressional
committees and commissions; (3) virtual reenactment of the commandeering
provisions of the Army Appropriation Act of 1916 in section 9 of the Selective
Service and Training Act of 1940, following reliance upon the commandeering
powers to support such maximum prices, as indicating legislative approval
thereof.

ni. THE AUTHORITY TO ISSUE PRICE SCHEDULES IN THE PRESENT EMERGENCY CIRCUM-
STANCES IS SUPPORTED BY THE EXECUTIVE POWERS OF THE PRESIDENCY AND THE
COMMANDEERING AND OTHER STATUTES ADDRESSED TO THE EMERGENCY

A. Exercise of the authority during 1917 and 191S.

1. The Executive authority to announce maximum prices was exercised by
the President, and agencies designated by him, during 1917 and 1918, in the
absence of specific statutory authorization. Such previous action of the
President is not only supported by sound principles and the acquiescence and
approval of Congress as shown below, but is in itself a factor indicating the
existence of authority. As the Supreme Court stated in United States v. Mid-
west Oil Co. (236 U. S. 459, 472-473), "government is a practical affair intended
for practical men," and "in determining the meaning of a statute or the
existence of a power, weight shall be given to the usage itself — even when the
validity of the practice is the subject of investigation."

2. The control of prices of basic materials was a gradual development. The
National Defense Act ^provided for a Council of National Defense, and an
Advisory Commission, having among others the function of the "creation of
relations which will render possible in time of need the immediate concentration
and utilization of the i-esources of the Nation." At first the Council of National
Defense confined itself to prices to be paid by the Government for its own
purchases. Determination of price levels for Government purchases was made
by committees established by the Defense Council, such as the General Muni-
tions Board.

However, it was quickly recognized that reasonable prices for both the
public and the Government are an integral part of the Nation's efficiency at a
time when it is fundamental to achieve complete coordination of resources.

2 See testimony of Bernard M. Baruch, War Policies Commission heariners (under H. J.
Res. 2.51, 71st Cong., 2d sess.), pp. 812-813 : "As to the morale of the generality of civilians
we all linow how it vas affectod — esnecially among soldiers' families and people of fixed
income — by the upward spiraling of the cost of living and the lavishness of reward to t^ose
who were in a position to profit by it as compared with the hardship imposed on those who
were compelled to suffer from it.

"As to the morale of industry at large in the World War, the uncertainty of the daily
fluctuation of price and the inevitable rising trend on all sides was matter for common
commiseration. I am aware of no able and experienced business administrator who does
not prefer operation under stable conditions to operation under a price schedule in an
unforseeable state of flux."

» Act of August 29. 1916. 50 U. S. C, sees. 1 to 4.

NATIONAL DEFENSE MIGRATION 6657

with concentration on production rather than preoccupation with price fluctua-
tions, and with maintenance of morale rather than its destruction because of
rising living costs/

President Wilson succinctly recognized this consideration in an address on
July 12, 1917, when he stated : '

"And there is something more that we must add to our thinking. The public is
now as much part of the Government as are the Army and Navy themselves ; the
whole people in all their activities are now mobilized and in service for the accom-
plishment of the Nation's task in this war ; it is in such circumstances impossible
justly to distinguish between industrial purchases made by the Government and
industrial purchases made by the managers of individual industries ; and it is
just as much our duty to sustain the industries of the country, all the industries
that contribute to its life, as it is to sustain our forces in the field and on the sea.

"We must make the prices to the public the same as the prices to the Govern-
ment. Prices mean the same thing everywhere now. They mean the efficiency or
the inefficiency of the Nation, whether it is the Government that pays them or
not. They mean victory or defeat."

On July 28, 1917, the Council of National Defense created the War Industries
Board in order to coordinate the war effort, and gave it specific direction "to
consider price factors." The War Industries Board evolved methods for placing
ceilings on prices for certain basic commodities covering purchases by the public
as well as by the Government. On March 14, 1918, the President appointed the
Price Fixing Committee, which devoted itself entirely to the task of stabilizing
prices of basic commodities until it was discharged of its duties in December
1918.' The maximum prices set were generally made applicable to sales to the
public as well as sales to the Government.

In describing the authority for the Price Fixing Committee, its chairman, Mr.
Robert S. Brookings, said :

"The Price Fixing Committee is appointed by the President, separate and
distinct, with absolute, fixed authority. It reports only to the President and gets
its instructions only from the President." '

On July IS, 1918, the Price Fixing Committee adopted the following statement
of policy : *

"First. Where the different purchasing departments of the Government require
so large a proportion of any commodity as to produce such scarcity of said com-
modity as to require price control with a view of avoiding a runaway market,
the Price Fixing Committee is expected by conferences with the said manufactur-
ers of said commodity to stabilize prices by agreement. Failiiig to agree, the
Price Fixing Committee tvill fix a price and enforce same through some purchas-
ing departnient of the Government, using to that end not only the various purchas-
ing enabling acts, but such indirect pressure as priority in fuel, transportation,
etc., etc., will permit.

"Second. Where a scarcity is produced in part or in whole by limitation of
imports, it is the Government's duty through the Price Fixing Committee, and a
system of import licenses under control of the War Trade Board, to see that
control is secured of said importations through an option reserved in the import
licenses so as to prevent a runaway market in said imported commodity.

"While prices as above outlined may only be arranged for the Government
and those associated with us in the war, they, as a rule, are made for the public
as well, and where made for the public, the price paid, both by the public and the
Government, is made the same, and, while it is the custom to make maximum
prices only, it is generally understood that unless there is a larger supply than
the demand, the maximum prices will by necessity also become the minimum price,
and the purchasing departments of the Government are usually expected to pay
this price."

The only stattitory provisions relating to prices were those contained in the
Food and Fuel Control Act of August 10, 1917.^ Regulation of prices of basic com-

* See statement of Mr. Baruch, footnote 2 above.

^ Address to the miners and manufacturers of the United States, published in ofl3cial
bulletin. July 12, 1917, p. 3.

8 By letter to Bernard Baruch, Chairman of War Industries Board, printed in Garrett,
Government Control Over Prices, p. 204, and relevant portion printed in minutes of the
Price Fixin? Committee, Senate Committee I'rint No. 5. 74th Cong., 2d sess.. p. 1.

' Minutes of the War Industries Board, Senate Committee Print No. 4. 74th Cong., 1st
sess.. p. 3.51.

* Minutes of the Price Fixing Committee, Senate Committee Print No. .">, 74th Cong., 2(J
sess.. pp. 849-8.50. A portion of the statement, not relevant here, is omitted. [Italics
supplied.]

"40 Stat. 276, amended 41 Stat. 297 (October 22. 1919).

6658

WASHINGTON HEARINGS

modities other than food and fuel was accomplished by Executive action without
specific statutory authority. The wide range of such commodities covered was
outlined as follows : ^^

"The controls undertaken by the War Industries Board between September
1917 and March 1918, and then transferred to the Price Fixing Committee con-
cerned copper, iron and steel, cement, yellow pine, Douglas fir, zinc, aluminum,
hemlock. North Carolina pine, and spruce. The controls initiated by the Price
Fixing Committee between March 14 and the close of war concerned hides and
skins, wool, mimition linters, harness leather, sulfuric acid, nitric acid, cotton
textiles, cotton linters, sand and gravel, manila fiber, building tile, sole and
belting leather, rags, wool grease, compressing rates for cotton, brick, millwork,
and gypsum wallboard. The informal controls exercised by the War Industries
Board itself independently of the Price Fixing Committee concerned lead, wood
chemicals, nitrate of soda, alkalis, nickel, quicksilver, platinum, manganese ore,
and burlap."

There is attached hereto as appendix A an announcement by the President
on November 5, 1917, of the ceiling prices for iron and steel products, undoubtedly
the most important commodity controlled.

Reference may also be made to the action taken with respect to lumber,
because of the difficulty which was experienced in connection with that com-
modity. On June 24, 1918, the Price Fixing Committee published maximum
prices for lumber and announced its decision in the following release : "

"The War Industries Board authorizes the following :

"The Price Fixing Committee of the War Industries Board has fixed maxi-
mum item prices for northwestern fir logs and lumber and for southern pine
lumber. The detailed schedules of these item prices have been approved by the
President and publicly announced. The prices established are 'manufacturers'
f. o. b. mill prices for shipment at the mills, the same for all purchasers. They
are maximum prices not fixed prices to hold for a period of 90 days from
June 15.

"No regulation has been made with regard to transactions other than sales
by manufacturers at the schedule prices. Wholesalers, dealers, retail dealers,
and all others are entitled to buy on the basis of these f. o. b. mill prices. As
yet no regulation of rates or profits has been made with regard to sales other
than by wholesalers or retailers to consumers. The War Industries Board
believes that sales by all dealers should be made at reasonable prices based
•on a strictly reasonable profit above the fixed schedule rates. The Board is
confident that the trade will conform to the spirit of the existing regulations and
the Board will not proceed to further regulation or restriction of dealers' prices
until their conduct of business indicates that such action is necessary."

3. The price ceilings established by the War Industries Board and by the
Price Fixing Committee met with general compliance. The vast majority were
eager to cooperate with the Government and voluntarily to comply with its
price regulations, recognizing the emergency which confronted the Nation. But
in setting prices, and incidentally setting them not at existing levels but at
substantial reductions herefrom,^ the Goverin.ient relied for ultimate sanction on
indirect controls which it declared would be exerted to enforce the ceilings on
prices. Chief among these was the power to commandeer, conferred primarily
by section 120 of the Army Appropriation Act of 1916."

Tills policy was reflected in a resolution of the War Industries Board while
steel prices were being considered. The minutes of the War Industries Board
on this point read as follows :"

"Steel, price fixing. — Mr. Summers, Mr. Replogle, and Mr. Legge were invited
into the meet^ing and informally presented their views as to the proper method the
War Industries Board should follow in the fixing of the price of steel. The
Board agreed that the proper methwl to pursue in fixing price for steel was to
fix the price of ore, coal, coke, transportation, and pig iron separately, in this

M Garrett : Government Control Over Prices (published by the War Trade Board in
cooperation with the War Tndnstries Board, Government Printing OflSce), p. 244.

" Official Bulletin, June 24, 1918, p. 13.

" See testimony of Bernard M. Baruch, War Policies Commission hearings (Under H. J.
Res. 2.51). IT. Doe. No 271. 71st ronsj.. 2rt sess., n. 5S (1031).

"Act of June 3, 1916, sec. 120; 50 U. S. C, sec. 80. Power to commandeer was also
prranted by the Naval Emersrency Fund Act of 1917, 39 Stat. 106S; the Emersencv Shipping
Fund Act of 1917, 40 Stat. 182 : and the Food and Fuel Control Act of August 10, 1917,
40 Stnt. 276.

i< Minutes of the War Industries Board (September 18, 1917), Senate Committee Print
No. 4, 74th Cong., 1st sess., p. 58.

NATIONAL DEFENSE MIGRATION 6659

way building up a fair price for steel. It was likewise agreed that should the
steel interests not be willing to give their full cooperation because of the price
fixed, that the War Industries Board should take the necessary steps to take
over the steel plants."

The steel industry did not violate the ceiling prices, and the War Industries
Board had no occasion to invoke this policy.

The significance of the commandeering power was outlined to the President
by the Chairman of the War Industries Board as follows :

"The prices imposed upon the steel manufacturers and copper producers, if
resisted, could have been enforced by seizing the mines and factories under
power conferred * * * in certain appropriation acts ; and the existence of
this power was sufficient to compel obedience to prices without exercising the
power." '^

The Chairman. Mr. Bernard M. Baruch, subsequently testified before the War
Jfolicies Commission :

"In practice the power to commandeer was very rarely used. It remained in
the background as the effective persuasive force which vitalized the whole
program of regulation." "

A distinction may conceivably be suggested in that during 1917 and 1918
maximum price.s were generally stated as "agreements." The distinction would
be legally unavailing since there was no statute authorizing Government officials
to reach such price-fixing agreements.

Moreover, maximum prices were set in the absence of agreements. Thus, in
the case of woolen rags, maximum prices were fixed by the Price Fixing Com-
mittee without a hearing and without an investigation into the trade, but
provision was made for a revision of the prices at the end of 10 weeks during
which an investigation would be made.

The announcement of the order read in part as follows :

"The Price Fixing Committee of the War Industries Board has fixed the
following maximum prices upon various grades of rags, effective on all sales
made from August 19, and remaining in effect until October 1, 1918, and
thereafter, pending the compilation of data which is to be furnished by the
Federal Trade Commission. These prices are net f. o. b. shipping point and are
to apply to sales made both to the Government and to the public." "

Tlie minutes explain that —
"?■« view of the existwg emergency, the Price Fixing Committee adopted the maxi-
mum prices on rags as in statement (attached hereto and made a part of these
minutes) which are to remain in effect until October 1, 1918, and thereafter until
further notice pending the receipt of a report from the Federal Trade Commission
and the compilation of additional data for the fixation of prices." '* [Emphasis
supplied.]

The "emergency" was outlined in a report from the Rag Administrator in the
Woolens Section of the War Industries Board, which stated that there had been
recent rapid increases and further increases could be expected unless action were
promptly taken."

Similarly, in the case of hemp, the Price Fixing Committee set a maximum
price without notice or hearing, without an agreement, in order to prevent the
lapse of prices which had been previously determined, although without authority,
In view of the fact that the sales took place within the United States, by the
War Trade Board. In the case of lumber there was some doubt whether there
was an agreement underlying the maximum prices first set.^

Furthermore, so-called agreements, which reduced prices from existing levels,
were reached in an atmosphere marked by statements of the Government officials
that they were prepared to fix prices by order. Thus, Mr. Brookings, Chairman
of the Price Fixing Committee, plainly informed the producers that" —

" Letter quoted in Putney. Bryant : Price Control in Wartime. Editorial Research
Reports, 1040. vol. II, No. 16, October 24. p. 81.3.

1" Hou.'se Doc. 271 (under H. J. Res. 251). 71st Cong.. 2d sess.. p. 41.

" Minutes. Price Fixinsr Committee, August 19, 1918. Senate Committee Print No. 5,
74th Contr.. 2d sess., p. 1095.

IS Minutes. Price Fixing Committee, August 19, 1918. Senate Committee Print No. 5,
74th Cong., 2d sess., pp. 1094-1005.

i« Td.

*» Hnrdy, Wartime Control of Prices, p. 139. footnote 24.

21 Minutes of the War Industries Board, July 9, 1918, Senate Committee Print No. 4,
74th Cong., 1st sess., p. 352. See also statement of Dr. T. W. Taus.sic. Minutes of Price
Fixing Committee, June 14. 1918 (Senate Committee Print No. 5. 74th Cong., 2d sess.), p.
697 : "It would be possible by a slight change in wording, a change in a phrase to substitute
'by agreement' for 'by order'."

QQQO WASHlN(rj(:»N HEARING>S

"The President has made it perfectly clear to us that we are not a body that
meets simply for the purpose of registering the wishes of the industry. That
is not what we are appointed for. We do try to agree with the industry, but,
failing in that, our instructions are to fix prices ; and if we cannot fix it by agree-
mtnt, we have to fix it by order, although we do not like to do that."

4. The price control of the administration was carried on with full recognition
of the fact that there was no specific statutory authority. Indeed, the War Indus-
tries Board, because of the difliculties involved in connection with lumber prices,
formally recommended "legislation investing the President with power through
such agencies as he may select to fix prices during the period of the war on such
articles and commodities as ho may deem necessary." ^

At the same time Woodrow Wilson, in an address before Congress, stated :

"Recent experience has convinced me that the Congress must go further in au-
thorizing the Government to set limits to prices. The law of supply and demand,
I am sorry to say, has been replaced by the law of unrestrained selfishness." ^

Congress failed to enact the legislation, but the Government continued its price
policy, in the absence of any Congressional prohibition and in response to the press-
ing necessities of the situation.

B. Executive poroers of the President.

1. The authority exercised during 1917 and 1918 is supported by the Executive
powers of the President. It is well established that the President has powers by
virtue of his oflice under the Constitution which extends beyond those powers
granted him by the Congress. As the Attorney General, now Mr. Justice Murphy,
recently stated to Congress : **

"You are aware of course that the Executive has powers not enumerated in the
statutes — powers derived not from statutory grants but from the Constitution.
It is universally recognized that the constitutional duties of the Executive carry
with them the constitutional powers necessary for their proper performance.
These constitutional powers have never been specifically defined and in fact can-
not be, since their extent and limitations are largely dependent upon conditions
and circumstances. In a measure this is true with respect to most of the powers
of the Executive, both constitutional and statutory. The right to take specific
action might not exist under one state of facts, while under another it might be
the absolute duty of the Executive to take such action."

2. The Constitutional provisions referring to the Presidency are all contained
in article II of the Constitution. Section 1, clause 1, sets out in a broad
phrase that —

"The Executive Power shall be vested in a President of the United States of
America."

Under clause 7, the President swears in his oath of office that he will, to the
best of his ability —
"preserve, protect, and defend the Constitution of the United States."

Section 2 provides that the President Is Commander in Chief of the Army
and Navy.

Section 3, in specifying duties of the President, provides inter alia, that —
"he shall take care that the laws be faithfully executed * * *."

3. The judicial decisions show that the President's authority is not limited
to the execution of specific congressional mandates . Even in considering the
duty of the President to take care that the laws shall be faithfully executed,
the Supreme Court laid down the principle that this duty was not "limited
to the enforcement of acts of Congress or of treaties of the United States
according to their express terms" but that it included "the rights, duties, and
obligations growing out of the Constitution itself, our international relations,
and all the protection implied by the nature of the Government under the
Constitution." In re Neaf/le (135 U. S. 1, 64).

Alexander Hamilton stated that the executive power is one which is granted
generally, in broad terms, to the President, and extends beyond the particular
grants of authority in article II, subject of course to the exceptions and quali-
fications expressed in the Constitution.^ This view is supported inferentially
by Kansas v. Colorado (206 U. S. 46), which construes in similar manner the

22 Minutes of the War Industries Board, December 5, 1917, Senate Committee Print No. 4.
74th Cong., 1st sess., pp. 149-150.

^ Address before Con9;ress, December 4, 1917. Official Bulletin, December 4, 1917, p. 3.

2* Sen. Doc. No. 133, 76th Cong., 2d sess., Executive Powers Under National Emergency,
pp. 2-3 (letter of the Attorney General rendered October 4, 1939, in reference to S. Res. 185,
agreed to September 28, 1939).

NATIONAL DEFENSE MIGEATION QQ61

clause vesting judicial power, and more clearly by Myers v. United States (272
U. S. 52).

4. The nonstatutory powers of the President embrace some power to take
action in an emergency, although the extent of such power, as Attorney General
Murphy stated, is dependent upon the circumstances.

In a recent treatise on the Presidency, a well-known scholar states as follows : ^"

"That the National Government has 'the inherent power' to meet grave national
emergencies has been proved in fact many times. By the same sign, pending
action by Congress, the President may, if the emergency is suflSciently pressing,
as in 1861, adopt temporary measures calculated to meet it, which measures are
'law' until superseded by congressional action."

Woodrow Wilson said that the office of President "has been one thing at one
time, another at another," '' and much depends upon the man who is President.
William Howard Taft, somewhat like James Buchanan, took the view as Presi-
dent that the President can exercise no power which cannot be traced to some
specific grant of power in the Constitution or the statutes,^ although that view
cannot be reconciled with his subsequent opinion in Myers v. United States, supra.
Theodore Roosevelt adopted a very broad view of the powers of the President.^

On various occasions the President has taken action in the absence of specific
authorization by Congress. For example, by Executive proclamation, in each
instance issued without statutory authorization, Abraham Lincoln blockaded the
southern ports (April 19, 1861) ; Theodore Roosevelt withdrew valuable coal
lands from the coverage of a Federal statute authorizing disposition at a low
price ; and Woodrow W^ilson ordered that companies operating telephone or
telegraph lines or cables operate only under regulations of the Secretary of War
or the Secretary of the Navy (May 1, 1917). There is no occasion to review
other instances, which exist in considerable number, since such actions depend,
as Attorney General Murphy noted, upon the circumstances of each case.

5. Without considering the extent of the President's powers with respect to
other matters, it is plain that at least until Congress directs otherwise the Presi-
dent can take steps to stabilize prices, including the issuance of ceiling-price
schedules, when the military defense of the country requires large-scale coordina-
tion of industrial resources and maintenance of industrial eflficiency, labor eflQ-
f'iency, and civilian morale.^"

Newton D. Baker, former Secretary of War, and an eminent attorney,
referred to the Executive powers of the President with respect to the matter
of controlling prices. In discussing the Capper-Johnson bill which would
have specifically authorized the President, in case of imminence of war, to
take steps to stabilize prices for commodities required by the Government and
by the civilian population, said : "

"It is really an express donation to the President of what has always been
tacitly regarded as the war power of the President * * * confirms by
-statutory enactment what has always been assumed to be the power of the
President."

The American Legion submitted a brief to the War Policies Commission in
support of the same bill. This memorandum, submitted with a notation that
it had been "submitted to and approved by many constitutional lawyers of
note," was signed by Ralph T. O'Neil, past national commander of the Legion,
Paul V. McNutt, and Col. C. B. Bobbins, former Assistant Secretary of War.
It contains this statement : '^

"In fact, the only argument that occurs to us in opposition to such authoriza-
tion is that it may not be necessary; that the powers of Congress and the
President to carry on a war are now plenary, and a statute can only serve
to restrict them."

The power exercised by the President during 1917 and 1918 may but need
not be supported without reference to legislation. As explained below (point
D, 2) a sincere and intelligent discharge of the constitutional duty faithfully
to execute the laws, particularly as applied to statutes such as the com-

25 The Works of Alexander Hamilton (Lodge ed.) , vol. IV, p. 438.

^ Edward S. Corwin, The President : Office and Powers, p. 133. In accord, see also, e. g.,
Herring, Presidential Leadership, p. 16 ; Berdahl, V\'ar Powers of the Executive in the
United States, p. 208 et sen.

2T Wilson, Constitutional Government in the United States, p. 69.

^ Taft, Our Chief Magistrate and His Powers, p. 139.

2» Roosevelt, The Works of Theodore Roosevelt, vol. XX, p. 34.

^ Compare Berdahl, op. cit., supra, p. 211.

SI War Policies Commission hearings, pt. I, p. 123.

*= House Document No. 271, 72d Cong., 1st sess., p. 64.

QQQ2 WASHINGTON HEARINGS

mandeering statute designed to assure mobilization of resources, and specifically,
reasonable prices to the Government, an achievement hardly practicable in
the absence of reasonable prices generally, provides an additional basis for the
President's action.

Furthermore, the price schedules and other steps taken do not purport to
be permanent. They were born in emergency and will be retured when the
emergency is terminated. "A limit in time, to tide over a i^assing trouble,
well may justify a law that could not be upheld as a permanent change." '^
The same is true of Executive action.

6. It is possible that some persons may question in this regard the relevance
of the price controls during 1917 and 1918 on the ground that they came alter
war had been declared by Congress. It is settled that there are no war powers
which are created by a war, but there are only the powers to meet the emer-
gency which arises in a time of war. See Home Building & Loan Association v.
Blaisdetl (290 U. S. 398, 426). The so-called war powers are misnamed if it is
assumed that they come into existence only when there is a war, with the pres-
ence of military operations. The view of Mr. Wliiting that Congress' war powers
exist only in the event of actual open hostility''* have been judicially demon-
strated to be unsound. Action can be taken for the purpose of preparing to
protect and preserve the country when the occasion arises. United States v.
Gettysburg Electric Raihvay Co. (160 U. S. 668, 682). The war powers include
the powers to strengthen the national defense. Ashicander v. Tennessee Valley
Authority (297 U. S. 288, 327-328). They are really defense powers.

Today, as in 1917, tiiere is a draft of men into military service, preparations
are being made for the national defense, and the recognition of the necessity for
complete utilization of our industrial resources has prompted passage of section
9 of ihe Selective Service Act. Accordingly, the powers exercised during 1917,
given further vitality by congressional acceptance and the reenactment of the
commandeering provisions in section 9 of the Selective Service Act, as shown
below, constitute support for the price schedules and other price-stabilization
activities authorized by President Eoosevelt.

C. Congressional acceptance of the President's exercise of authority.

1. The manner in which the Chief Executive exercised control over price levels
through maximum prices in specific commodities was explained to the public
and to Congress at length and in detail. It was set forth in the Final Report
of the Chairman of the United States War Industries Board to the President
of the United States, February 1919."^ It was also described in detail in the
treatise. Government Control of Prices, by Paul W. Garrett, published (Govern-
ment Printing Oflice) in 1920 by the War Trade Board in cooperation with the
War Industries Board.

2. It was investigated by, and was the subject matter of, considerable testi-
mony at the hearings held in 1931 by the War Policies Commission, a commission
of Senators, Representatives, and Cabinet members appointed under the author-
ity of Public Resolution No. 98, Seventy-first Congress, second session,"^ and at
the hearings held by the so-called Nye committee (SiDecial Senate Committee on
Investigation of the Munitions Industry, 74th Cong., 1st sess)."

Mr. Baruch, in answering questions of Senator Joseph T. Robinson, of the War
•Policies Commission, stated:

"Senator Robinson. //( fixing the prices, was the Board acting under express
authorization of statute, or by implied authority?

''Mr. Baruch. Implied, sir.

"Senator Robinson. The Board never had an express authority to regulate
prices?

"Mr. Babuch. Well, I would not say that exactly. Senator. There was a good
deal of discussion about the legal side of it, but that never came to the surface.
General Johnson calls my attention to the fact, for instance, that on some par-
ticular things, like fuel, there was a particular statute ; but so far as the large
number of things we have been referring to, there was no specific authority.

« Block V. Hirsh (256 U. S. 135, 157) .

3* Whiting. War Powers Under the Constitution (1871).

^^ Senate Committee Print No. 3, 74th Cong., 1st sess.

*> The War Policies Commission was composed ol Secretary of War. Patrick J. Hurley,
Chairman ; Secretary of Navy, Charles F. Adams ; Secretary of Agriculture, Arthur M.
Hyde ; Secretary of Commerce, Robert P. Lamont ; Secretary of Labor, William N. Doak ;
the Attorney General. William DeWitt Mitchell ; and Senators Reed, vice Chairman. Vanden-
berg, Robinson, and Swanson : and Representatives Hadley, secretary, Holaday, Collins, and
McSwain ; Robert H. ISIontgomery, executive secretary.

»' The Special Senate Committee on Investigation of the Munitions Industry was com-
posed of Senators Nye, chairman, George, Clark, Bone, Pope, Vandenberg, and Barbour.

, NATIONAL DEFENSE MIGRATION 6663

"Senator Robinson. My question really had application to the broad sphere
of control.

"Mr. Baeuch. Except this, Senator, that the Government had power to com-
mandeer under the authority given by the Congress, for the things that it needed
for the Army and Navy. And when we discussed prices with producers, we were
always in a position to commandeer and we made what we called, in those days,
voluntary arrangements as to price ; because we did always have the power of
seizure, or keeping away transportation or fuel from anyone who objected to
the regulation. But I must say, by and large, American industry did its full
share.

'^Senator Robinson. Did you find many instances in which there was great
difS-ulty to reduce prices?

' Mr. Baruch. Well, there were a good many acrimonious discussions at times,
but we finally ended by making prices which I think were fair in the circum-
stances. You must remember when we entered the war the prices had gone
to prodigious heights, much higher than they were toward the end of the war.
We were faced with a difficult situation, but, by persuasion and understanding
and sometimes by threat, covert or otherwise, we were enabled to make what
we thought were fair arrangements."' ^

Similarly, Mr. Baruch explained the 1917-18 experience at considerable length
to the Nye committee.

It is sigii'ficant that at no time has Congress, or the War Policies Commission,
or the special Senate committee indicated in any way that the price fixing during
1917 and 1918 by the President of the United States, and by the agencies desig-
nated by him, was in any way unlawful or a usurpation of authority. The War
Policies Commission recommended a constitutional amendment, but asserted that
this was "to eliminate all doubt concerning the extent of the power of Con-
gress * * * to stabilize prices." The Commission further recommended
that Congress take action even if no constitutional amendment were passed. A
preference was impliedly expressed for congressional action (which can be
supported by direct and heavy sanctions), but in no way was it stated or indicated
that the Executive action represented a usurpation of authoriy.

The Special Senate Committee on the Investigation of the Munitions Industry
issued a Preliminary Report on Wartime Taxation and Price Control, Senate
Report No. 944, part II, Seventy-fourth Congress, first session. This report con-
tains more than 70 pages of critical analysis of the price stabilization measures
adopted during 1917 and 1918. Although the committee concluded that the use
of the commandeering power was relatively ineffective to prevent price rises
(p. Ill), and although the committee criticizes in various ways the activities
of the War Industries Board, the committee in no way indicated that the
maximum price efforts represented a usurpation of authority by the Executive.

Indeed, the most trenchant criticisms of the Government's efforts turned upon
the objections that they had not set the maximum prices low enough. Reference
is made not only to the report of the special Senate committee discussed above,
but also to the report of the so-called Graham committee, which stated : ^^

"It has also been said in defense of the price fixing by the Government and
its other negotiations that the market price of copper was approximately 32 or
33 cents per pound when we entered the war, and that the price fixing by the
copper producers was far below what they might have obtained on the open
market. However, it will be remembered that the copper producers were at
the mercy of the Government at that time, and that under section 8 of the act of
August 10, 1917, the Food Control Act, the Government had the right at any
time to commandeer the mines and to practically fix its own price on copper."

The foregoing may be taken to indicate congressional approval of the Exec-
utive's exercise of authority. It certain ind cates congressional acquiescence
in the view that the executive powers of the President, buttressed by such sanc-
tions as resided in the requisitioning statute, constituted suflicient authority for
the Government's price-fixing program.

The significance of such acquiescence appears from the case of the United
States V. Midwest Oil Co. (276 U. S. 459). The Supreme Court upheld action
by the Pi-esklent in withdrawing from occupation lands which had been opened
by Congress, in the absence of statutory authorization to the Executive, on the
ground that such action represented a practice by the Executive which had

38 War Policies Commission hearings, under H. J. Res. 251, H. Doc. 271, 71st Cong.,
2d sess. (in31),p. 50. [Italics added.]

^ See Expenditures in the Ordnance Department, H. Rept. 1400, 66th Cong., 3d sess.
(Select Committee on Expenditures in the War Department, headed by Mr. Graham, of
Illinois), p. 93.

5664 WASHINGTON HEARINGS

been made known to the Congress and had been acquiesced in by Congress.
The opinion is the more significant in that, as the Court recognized, there was a
congressional statute authorizing such Executive action for the future, but ex-
plicitly failing either to ratify or condemn such Executive action in the past.

D. The reinforcement provided hy recently enacted statutes, such as the com-
mandeering statute, including the adoption of the 1917-18 practice

1. Recent statutes constitute a recognition by Congress of the existence of an
emergency of such scope and nature as to warrant reliance on the 1917-18
precedents. The Selective Service and Training Act of 1940 enforces the draft
of men into the Army. Section 9 provides for commandeering of plants refusing
to produce articles or demanding an unreasonable price therefor, and in substance
reeuacts section 120 of the Army Appropriation Act of 1916. Reference may be
made likewise to the statutes appropriating $40,000,010,000 for the purchase of
defense materials, reviving the Sabotage Act passed during the last war, and
strengthening the espionage statutes. With respect to industrial coordination, a
statute of primary importance is section 2 (a), Public, No. 671, Seventy-sixth
Congress, Second Session, giving priority in production to defense orders.

2. These statutes not only indicate the state of emergency in which the inherent
power of the Executive is operative, but they also relate to the iwwer and duty
of the President to "take care that the laws shall be faithfully executed."

In a state of affairs calling for intensive utilization of our industrial resources,
it is within the province of the Chief Executive to coordinate the application of
the foregoing statutes making demands upon our industrial machine, in terms
pf an integrated, efficient, over-all policy. Unless the lessons of the World War
are to be discarded, it is plain that such a policy must contain price stabilization
as an integral part, if it is to be truly effective in its dominant purpose of a
thoroughgoing coordination of industrial resources. In discharging the duty to
assure that the Government secures materials at a reasonable price the Chief
Executive can properly make the judgment that such result in the present circum-
stances can most appropriately be effectuated by assuring that prices on all
sales are kept at reasonable levels. And with respect to the priorities statute,
it is the teaching of experience that priorities powers cannot practicably be
administered in the absence of a price-stabilization program.

3. Section 9 of the Selective Service and Training Act of 1940 is virtually iden-
tical with section 120 of the Army Appropriation Act of 1916, with but slight and
immaterial change in language and content. It is and was well known that the
commandeering power, which was available in the event of failure to produce for
the Government at a I'easonable price, was invoked during 1917 and 1918 as an
ultimate sanction supporting the maximum prices then announced as applicable
on all sales, to the public as well as the Government. The Nye committee was
of the opinion that the commandeering sanction would probably be impracticable,*"
but recognized its applicability.

When, therefore. Congress enacted section 9, in language virtually identical
with that of section 120, it was in effect reeuacting the statute. Reenactment of
a statute is generally deemed to constitute legislative approval of the executive or
administrative application of that statute (United States v. Bailey, 9 Pet. 228, 256;
McCaughn v. Hershey Chocolate Co., 283 U. S. 488, 492; Copper Queen Mining Co.
V. Arizona Board, 206 U. S. 474, 479). The virtual reenactment of section 120
must therefore be approval by the Congress of the Government's reliance upon
the commandeering power to support reasonable maximum prices announced
by the Executive.

IV. PRICE STABILIZATION .\CTIVITIES

Finally, it may be appropriate to point out that the price schedules represent
only one aspect of the price-stabirzation activities, and to put such price
schedules in their proper setting. Since May 28, 1940, the Price Stabilization
Division of the Advisory Commission to the Council of National Defense, and
since April 11, 1941, the Office of Price Administration and Civilian Supply, have
undertaken studies in the fields characterized by or likely to be characterized
by price rises. They have endeavored to be of assistance in assuring that Army
and Navy purchasing did not obtrude upon commodity markets at such times as
unnecessarily to increase prices. They have endeavored to assist the officials
responsible for production by helping to anticipate the fields in which shortages

See report, op cit., supra, p. 116.

NATIONAL DEFENSE MIGRATION 6665

of supply (and resulting price increases) could be avoided by timely action to
expand production. They have made recommendations to the appropriate offi-
cials with respect to curtailment of exports, or acquisition of imports where
shortages of commodities could be anticipated, Such activities have contributed
not only to price stability but also to the increase of supply where shortage
would liinder the national-defense effort.

As already noted, we have relied to a gi-eat extent upon appeals to the
patriotism of the various individual producers to prevent excessive price In-
creases. Tribute is due, among others, to the individual steel and copi)er
producers.

We have also been vigilant to examine the facts of the industries characterized
by the price rises and to state our conclusions where we found price increases
unjustified. Thus in July 1940, by demonstrating and announcing that a feared
shortage had no substantial basis, the Division counteracted a rise in prices of
paper and paper pulp. Wherever it was found that price increases were not
supportable and had no justification (except in the desire of producers in a
strategic position to take advantage of the Nation's needs during the emergency),
such findings were announced. The vast majority of the businessmen of this
country are patriotic, do not wish to profiteer, and are well aware of the dangers
inhernt in excessive price rises and inflation. Yet even such men find that the
small minority of producers may set the tone of prices in an industry and they
will ride with the rising tide they cannot prevent. The mere statement in Jan-
uary 1940 that lumber prices were unjustifiably high, and that $25 f.o.b. mill
was a reasonable maximum price for No. 1 common southern pine lumber, en-
abled the industry to hold prices to a reasonable level, and they have even
dropi)ed below that figure.

Price schedules constituted merely the next step. Price schedule No. 1 was
issued February 17, 1941. It announced a ceiling for prices of second-hand
machine tools. These prices had been raised to fantastic heights, considerably
exceeding the prices of new machine tools. Such price increases were not due
to rising costs. They merely reflected the fact that the Government, the British
Government, and their contractors and subcontractors, faced with an all-im-
portant need for production, were willing to pay any sums whatever to get hold
of machine tools. Often the high prices, instead of bringing tools out. induced
speculative withholding for future profits. Various responsible dealers in second-
hand machine tools were alarmed by this extravagant situation, but they were
unable, by their individual actions, to stem the tide.

At this point, the Price Stabilization Division issued Price Schedule No. 1. It
directed buyers and sellers to comply with ceiling prices found to be reasonable
Imitations. It further stated that in the event of lack of cooperation the Price
Stabilization Division would make every effort to assure that Congress and the
public were fully informed, and that the powers of the Government would be
exerted to protect the public. The price schedule was not termed an order, and
it clearly did not assert any inherent compulsive effort. However, the price
schedule, buttressed primarily by the patriotic support of the members of the
trade and by public opinion, has, it is generally considered, achieved a lowering
of prices.

Subsequent price schedules have all been of the same nature, and have been
prompted by similar extreme or emergency conditions. Price Schedule Nos. 2
to 4, relate to the secondary or scrap materials markets, which, because of
shortages in and priorities for the virgin metal, threatened price repercussions
out of all proportion to the value of the commodity involved. The bituminous
coal order (Price Schedule No. 5) was intended to avoid any further unneces-
sary and unjustifiable profiteering from a temporary emergency, and has already
been revoked. And Price Schedule No. 6, relating to iron and steel products,
was intended to avoid price rises until the necessity therefor could be studied.
Such action is a practical necessity if this country is to be protected from the
dangers of price spirals and inflation.

V. CONCLUSION

For the reasons stated above, it is submitted that the price stabilization
activities undertaken since May 28, 1940, and particularly the issuance of ceiling
price schedules, were not a usurpation of authority as charged but were legiti-
mate steps taken to protect against price spiraling and inflation, and to further
the defense effort.

QQQQ WASHINGTON HEARINGS

Appendix A. Specimen price-fixing order issued hy President Wilson.

(Made public through Mr. Creel November 0, 1917 (Steel) )^

The President has approved an agreement made by the War Industries Board
with the principal Steel industries of the United States, fixing maximum prices,
subject to revision January 1, 1918, on certain steel articles as follows :

Sheets :

No. 28. Black sheets (per 1(K) pounds f. o. b. Pittsburgh) $5. 00

No. 10. Blue annealed sheets (per 100 pounds f. o. b. Pittsburgh) 4. 25

No. 28. Galvanized sheets (per 100 pounds f. o. b. Pittsburgh) 6. 25

The above prices to apply to both Bessemer and open-hearth grades.

Pipe: On %-inch to 3-inch black steel pipe — discount 52 and 5 and 2.^2 percent

f. o. b. Pittsburgh.
Cold rolled steel : 17 percent discount from March 15, 1915, list, f. o. b. Pittsburgh.

Scrap :

No. 1. Heavey melting (per gross ton, f. o. b. consuming point) $30

Cast-iron borings and machine-shop turnings (per gross ton, f. o. b.

consuming point) 20

No. 1. Railroad vrrought (per gross ton, f. o. b. consuming point) 35

Wire: Plain wire (per 100 pounds f. o. b. Pittsburgh) 3.25

Tin plate: Coke base, Bessemer and open hearth (per 100-pound box

1 o. b. Pittsburgh) 7.75

In connection with the above, the iron and steel manufacturers have agreed
promptly to adjust the maximum prices of all iron and steel products other than
those on which prices have been agreed upon, to the same general standards as
those which have been announced. It is expected that this will be done promptly
and consistently in line with the basic, intermediate, and finished products, for
which define maximum prices have been established.

WooDRow Wilson.

TESTIMONY OF LEON HENDERSON— Resumed

Mr. Curtis. Is your idea of the Government's autliority in price
fixing based upon a statute or is it just your conclusion as to our
general scheme of government ?

Mr. Henderson. That conclusion is based upon experience and
various cases, and it is also based upon a memorandum prepared dur-
ing the last war by counsel for the War Industries Board, as to the
source of power. We dug that out of the archives very early to see
what was available. And, of course, I have consulted from time to
time with those that were responsible for price fixing in the last war.

Mr, Curtis. Would you limit the scope of your price-fixing author-
ity to those articles directly connected with defense, or do you think
that goes to our entire price structure?

Mr. Henderson. I think it goes to the entire price structure, be-
cause there are many, many prices that have been rising recently which
are only remotely connected with defense.

Mr. Curtis. You think it extends

Mr. Henderson, Let me put it this way : As you divert certain
things to the defense effort and yoii have an increase in your pur-
chasing power resulting from the Government paying money out and
thus creating new purchasing power, it exerts a pressure on goods that
may not be connected at all with defense — may be only incidentally
connected — but the public interest requires that you have a stable
economy if you are going to forward your defense effort and there is
nothing more dislocating to an economy than a highly inflationary
price trend.

NATIONAL DEFENSE MIGRATION 6667

Mr. CuETis. Would you include farm land and other real estate?

Mr. Henderson. I don't think so — I hadn't thought about that. I
think the high price of farm land was a reflection of the extraordinary
inflated prices of commodities during the last war. If you kept the
prices of commodities down you wouldn't have had that problem at all.

Mr. Curtis. And would you extend it to personal services?

Mr. Henderson. Not personal services but to services that were
akin to commodities. Now, maybe I haven't made myself clear.
It seems to me that large parts of the commodity and service list
might not have to be brought under price ceilings — that is, that
they would be kept stable, but it would seem to me that, and it is
like Gresham's laWj if you didn't have the power to keep a certain
group of prices in line that that is where the effect of the inflationary-
forces would manifest themselves.

Mr. Curtis. And do you think that this power should extend fo^
both maximum and minimum prices?

Mr. Henderson. Yes — you mean the existing power?

Mr. Curtis. The power of the President to control all prices in
the country by reason of the emergency. You construe that to in-
clude both the floor and the ceiling on prices, or just the ceiling?

Mr. Henderson. I would construe it to apply to both, but I think
it would hinge on the importance of the particular situation in main-
taining a stable economy. In other words, I don't think it would be
necessary to go down into every ramification.

price fixing as stabilizer of economy

Mr. Curtis. Do you think that we would have a stable economy
if we undertook to fix all the prices?

Mr. Henderson. Not unless other things M'ere done also.

JVIr. Curtis. What other things?

Mr. Henderson. Such as a stiff tax program — a very, very heavy
savino;s program, control of expansion of credit and expansion of sup-
ply of the noncompeting goods. I think all of those are a working
part of keeping a stable economy under the terrific impact of defense
spending.

Mr. Curtis. Now, in reference to the savings program : Do you re-
fer to a compulsory savings program ?

Mr. Henderson. No ; I am referring to savings as such, but I could
conceive of a situation where the seriousness was such that some
form of what I have called "quasi-voluntary savings" might be neces-
sarv. I can conceive of a situation parallel to England's experience
and for that reason we keep a very close watch on it.

They have had to have revisions of their mechanism of control
over prices and so have we. We passed from one kind of a period
in the old Defense Commission into another with O. P. A. C. S., and we
will pass into a third, it seems to me, with formal legislation. I
think that the English experience with savings was that they were
highly satisfied with the voluntary response that they gob in the
early months of the war.

Mr. Curtis. And would you say it would still be possible for us
to miss our guess and make a mistake after you pursued all the
avenues of savings, taxes, credits, inflation, and price structure, and
so on — that it still would not be foolproof?

WASHINGTON HEARINGS

Mr. Henderson. No.

Mr. Curtis. We still might miss the boat?

Mr. Henderson. I don't think we would miss the boat, but if you
mean in terms of a runaway inflation, there would still be powerful
pressures operating on the price level, yes ; that is true of every coun-
try whose price experience we have examined — Japan, Germany, Eng-
land, Canada, France, and Italy.

POST-WAR PRICE DISLOCATIONS

Mr. Curtis. You would run into a great deal of difficulty and
complications in enforcing it; wouldn't you?

Mr. Henderson. Yes. I think you have got to foresee that, but
I think that the destruction that would be caused to values and to
the operation of the economy warrant trying to handle those com-
plications.

I think we had a tremendous loss in this country in the period
after the war from the dislocations caused by prices running away
when the Government controls were taken off after the armistice.
Prices went up more than 20 percent and then we had the precipitous
drop and it took this country at least 3 years to get back on a work-
ing basis again — ^to get back on the basis on which a manufacturer
could make a forward commitment with some assurance of cer-
tainty, which is necessary for the way in which goods are contracted
for and delivered.

I think although it has many headaches and can't be foolproof
that it is something that recognizably has to be done.

Mr. Curtis. But the thing carried to its final analysis is a com-
plete governmental control of the economy ; isn't it, during the time
the system is in operation?

COMPLETE "gO\'ERNMENT CONTROl" OF ECONOMY NOT NECESSARY

Mr. Henderson. No; and I want to be very, very positive and
emphatic on that. The governmental control, if I gather what you
mean, in Germany or Japan, for example, the intensiveness of it,
the place of the Government in the decisions at the individual pro-
ducer's line, the preemption of any available amounts of earnings
diat he may have for Government loans or for taxation, a Government
control which says to him : "You can't make these repairs," and things
like that; that is my idea of your term "of complete Government
control."

I don't believe that that is necessary in this country. I do not
only believe it is not necessary, but I think it would be highly un-
desirable because I think that the things we are defending, the things
that are at issue here are the maintenance of a strong, vigorous,
individualistic system in which the decisions are not made by Gov-
ernment but where they rely on the ingenuity and drive of the
individual.

I think that is what is at issue and my conception of regulation
is directly tied to my concept of what it is we are defending and
what it is we want to do and what the post-war problem is going to
be. I think in these terms as a democratic form of action against
a totalitarian form of action, and I prefer to believe that the Amer-

NATIONAL DEFENSE MIGRATION 6669

ican system is best and we will win out in the end, and I think the
controls have got to be directed toward that.

EACH WANTS HIS OWN PRICE RISE

Mr. Curtis. It is true that one very wholesome factor will be the
vivid memory that many people have of the mistakes made a score
of years ago, isn't that true ?

Mr. Henderson. That is correct.

Mr. Curtis. And their decisions will turn upon that.

Mr. Henderson. If we can get the vividness to apply to the indi-
vidual producer and his prices we would be much better off. Every-
body is against inflation, but is in favor of a little price rise in his
own commodity, but inflation comes by reason of prices being
advanced.

Mr. Curtis. That is true, but I do not believe you could go to an
agricultural area and convince very many people who are 40 years
of age or older, that land would continue to go up and there would
be a great heyday and it was a good idea to buy a new farm at an
exorbitant price and mortgage both of them to pay for it. I don't
think that is going to happen again.

Mr. Henderson. I can tell you the assurances we have had from
people interested in farming and farmers, is that the memory is very
vivid and they are against inflation.

Mr. Curtis. I have also taken occasion to inquire of tlie number of
migrants that have come before this committee as to their point of
view. They say it is more or less a common realization among them
of the type of work they are doing now and that it is going to stop
abruptly and they are trying to adjust their personal matters so they
can light with their feet on the ground in the best possible manner.

That is all, Mr. Chairman.

The Chairman, Mr. Osmers.

MR. HENDERSON COMES OUT ON TOP

Mr. OsMERS. I have just one or two more questions, Mr. Henderson,
that occurred to me.

I notice by the papers that you have moved your residence ujnvard.
I don't know whether that has been correctly reported or not.

Mr. Henderson. That is right, for the second time.

Mr. OsMERS. You have gone right through the roof ?

Mr. Henderson. For the second time in my life I am living in a
small penthouse. We took over an apartment house that had never
been occupied and we are pretty well fixed up. I exercised a preroga-
tive to convert the penthouse into offices.

Mr. OsMERS. Well, I just wanted to say that at least you have
adjusted yourself upward and you have gone as far as you can go
in that particular building.

I wish all of our prices were checked as effectively in their upward
progress.

Do you think, kind of summing up, Mr. Henderson, with all of
these things that we have been discussing here — cooperation between
Government and business, and so on, we will be able to keep the
situation from going through the roof?

Mr. Henderson. I do, most earnestly.

5570 WASHINGTON HEARINGS

Mr. OsMEES. Do you think it is possible to do that ?

Mr. Henderson. I think that the attitude of mind generally that
we find on the part of responsible people in industry and agricul-
ture and labor is that they do have that memory of ^vhat inflation
would do and that you can get a pretty strong effort made to keep
things in line.

Mr. OsMERS. I think that is true. I am tremendously concerned, as
I know everyone is, with the rising cost of living, which is just
starting, and, of course, if it ever gets loose we are lost.

NEW SOCIAL SECURITY FOR MUNITIONS WORKERS

There is a question I wanted to ask your opinion on. It really
doesn't come within the scope of your statement but you might care to
express an opinion on it. We have certain industries in the United
States that are purely defense industries — making powder, guns, and
shells, and things of that sort that will automatically cease to exist at
the conclusion of the emergency.

Now, I am at the present time drafting a piece of legislation which
I may submit to Congress, which will increase the social-security
payments of those workers who are engaged in purely defense indus-
tries, so that at the conclusion of the war when we know those ])eople
are going to be unemployed, they will have a longer period of time, a
longer cushion to fall back on than our present social-security laws
provide.

What is your opinion of that ? Would you care to give it ?

Mr. Henderson. I think it is a good idea. I think that it comes
under the heading of savings and we have got to look to a backlog
of very substantial proportions for that transition period and I think
the same thing can be applied to individuals and to States and to the
Federal Government. I think that they can postpone a number of
things until that period to help stop the gap.

Mr. Osmers. Isn't it also a possibility — and it will bear directly on
the migration of people — isn't it also a possibility that we might work
in some savings plan, or call it Avhat you will, within the framework
of our present social-security structure which is already set up — the
workers are listed and they have their cards and so on.

Mr. Henderson. That is con-ect.

Mr. Osmers. That is all.

The Chairman. Dr. Lamb.

Mr. Lamb. You would agree, would you not, that probably the best
way to handle inflation ideally would be to be able to expand produc-
tion, because by that means you would keep prices down automatically
and then control, such as you are called on on make, would not be nec-
essary as matters stand. However, these adjustments become inevi-
table because of shortages which cannot readily be overcome.

SUPPLY OF BUILDING MATERIALS

There is one set of shortages that the committee is particularly
concerned about and that is the shortage of building material for the
construction industry, especially for housing.

Is there any contemplation or has there already been any necessity
to institute priorities in the building industry ?

NATIONAL DEFENSE MIGRATION 6671

Mr. Henderson. I don't believe there has been any general priority
on the building industry, but there has been on some of the materials
that go into it.

It was necessary, as you probably know, as the effort progressed in
the last war, to curtail building operations very materially. My
guess would be that that can be put in the framework of inevitability
now.

Mr. Lamb. Of course, this committee is very much concerned with
that on account of the effect on defense housing and thereby its effect
on migrants coming into defense communities.

Mr. Henderson. I think it is going to mean that conservation
work and substitution work will have to be brought into play
to get materials available for housing that do not compete with defense,

Mr. Lamb. That is what I was getting at.

Mr. Henderson. And I think you will have quite a bit of translation
of effort there.

Mr, Lamb. You mentioned, in the course of your testimony, towns
affected by priorities. This committee would like to have, if it can
be secured for the record, a list of towns so affected. You mentioned
a few in your paper. Could you tell us how we might go about getting
a fairly comprehensive list ?

Mr. IHenderson. I think that the Priorities Division of O. P. M. and
the Defense Contract Service Section would be a good source for that
because that is where the pressure is applied. It is being applied to us^
of course, because of this newly acquired duty of ours, but not in such a
degree as it is on the priorities administration and on the Defense
Contracts Service Section.

Mr. Lamb. We will get in touch with them.^

CONTROL OF BUILDING MATERIAL PRIORITIES

Going back to the earlier question. Would the control of building
priorities rest with your office ?

Mr. Henderson. The allocation of residual supplies would; yes.

Mr. Lamb. But the decision as to whether they were necessary or
not in the building industry, would that be your concern ?

Mr. Henderson. Yes ; that is, the O. P. M. through the Army and
Navy Munitions Board, would determine what of the materials
and other resources were necessary for defense contracts, leaving a
residue to allocate, and we would have to apply the needs of the build-
ing industry as against all the other industries in terms of these general
standards that I recited awhile ago.

Mr. Lamb. I suppose in any such determination as that, the Office of
the Coordinator of Defense Housing would have to sit in to discuss
such a shift in allocations, would he not?

Mr. Henderson. Now, on the matter of defense housing, which is
directly tied to defense, that priority would be determined by O. P. M.
in connection with the Defense Housing Coordinator.

Mr. Lamb. And not throu^crh O. P. A. C. S. ?

Mr. Henderson. That is risht.

1 The committee was informed by the Labor Division of the O. P. M. that a survey
of communities bad been undertaken for the compilation of such a list, but that com-
pletion of the work would be too late to permit of publication in this volume.
60396 — 41 — pt. 16 24

QQ72 WASHINGTON HEARINGS

Mr. Lamb. And the legal control of defense housing would rest with
the Coordinator's Office or with the O. P. M., or do you know ?

Mr. Henderson. AVith the Defense Housing Coordinator and the
agencies to which the funds are assigned for building those houses.

Mr. Lamb. That is all, Mr. Chairman.

The Chaikman. Mr. Henderson, I want to express to you the deep
appreciation of this committee for your fairness and patience here. I
am sure that what you have contributed will be extremely valuable to
us, and I thank you very sincerely for appearing here this morning.

Mr. Henderson. May I congratulate you on your skillful choice of
questions. I must say that either the committee was picked for those
who had had experience or else, in the course of its deliberations, they
have developed a special skill along those lines.

The Chairman. I want to say to you, Mr. Henderson, in that regard,
that this is not a one-man committee. We divide it up and we assign
particular members to question particular witnesses.

We thank you very much, Mr. Henderson.

The committee will stand adjourned.

(Whereupon, at 1 p. m., the committee adjourned until 10 a. m.
Friday, July 18, 1941.)

INDEX

Agriculture (see also tmder Employment and United States Government) : Page

Areas affected by defense program 6561

Meclianization 6562

Wickard plan for land-use subcommittees 6500

A. F. of L. (See under Unions.)
C. I. O. (See under Unions.)
Community facilities :

Defense areas 6521, 6522

Funds available under Lanham Act 6528

Contracts. (-See under Industry.)
Discrimination. (See under Employment.)
Education. (See under Schools and vocational training.)
Employment (see also Industry, Migration, Unions) :
Agencies :

State employment agencies 6361, 6405, 6462, 6498

United States Employment Service 6415,6451

Agricultural :

Changes in number of persons in agricultural pursuits May 1940 to

May 1941 6561

Child labor 6504

Clearance 6503

Effects of defense program on farm labor 6567

Family groups 6502

Labor shortages 64'^6. 6497, 6498, 6499,

6500, 6501, 6503, 6505, 6511, 6560, 6562, 6567, 6569, 6570

Maldistribution of farm labor 6567

Migratory 6l;02

Negro 6"02

Peak periods 6504

Placement 6571

Relation to industrial labor market 6496

Relation to W. P. A 6501, 6514

Sources of farm labor 6503, 6505

Unpredictables in farm labor need 6570

Wages and hours 6498, 6503, 6505, 6560, 6561

Women 6502

Yardstick for labor supply 6569

Defense :

Bottlenecks impeding reemployment 6508

Dismissal wage 6425

Effects of technological improvement 6490

Effects of training program on labor standards 6465

E-stimated increase 6312, 6313, 6314, 6560, 6561

Estimated total labor requirements 6393

Government agencies working on labor supply 6343-6345

Labor relations 6383, 6388, 6401, 6402, 6408

Labor requirements by regions (5314-6317

Labor requirements by States 6318-6332

Labor requirements of aircraft manufacturers 6608

Labor shortages 6613, 6615, 6646

6673

6674

INDEX

Employment — Continued.

Defense — Continued. Page

Labor turn-over due to rent rises 6632

Peak estimates for defense industries 6492

Percentage of total nonagricultural workers in 15 key indus-
tries, April 1941 6491

Proportion of applicants hired 6510

Ratio of skilled to unskilled workers 6492

Recruiting 6414, 6415, 6461

Regional placement system, Labor Division of O. P. M 6342

Relation to national income 6485

Sources of labor supply 6471,6509,6560

Stabilization of aircraft industry 6400

Stabilization of shipbuilding industry 6386-6338,6400

Supply and training report, Labor Division of O. P. M 6343

Volume of unemployment in relation to increase in employment 6492

Wages and hours 6383, 6388,

6393, 6398, 6400, 6401, 6462, 6493, 6404, &455, 6483, 6491
Discrimination :

Against age 6516

Against minority groups 6540, 6541

Against Negroes :

Attitude of employers 6530, 6531

Attitude of organized labor 6473-6475,6530,6531,0537,6540

Companies committed to employment of Negroes 6535

Companies refusing to hire Negroes 6541

Discriminatory practices in some State employment services— 6.)42

Effect of President's order 6539

Efforts to combat 6538

Report of Negro Employment and Training Branch, Labor

Division, O. P. M 6530-6545

In various defense areas 6382, 6383, 6536, 6543

Forecasts for industry as a whole 648:>, 6491, 6492, 6493, 6508

Nondefense :

Automobile industry 6647, 6650

Dismissal wage 6417

Effects of priorities 6391, 6392, 6397, 6470, 6476, 6484, 6488, 6624, 6639

Relation to national income 6492

Savings, prices, profits as factors in nondefense employment 6492

Shift to defense 6397, 6485, 6489

Wages and hours 6483, 6491

National Youth Administration out-of-school work program 6371

Normal labor force increase 6482

Racial factor in mechanical aptitude 6544

Stability and totalitarian methods 6405, 6409

"Statistical liquidation" of the unemployed 6482

Unemployment :

Effect of defense program 6486

Factor in choice of plant sites 6566

In A. F. of L. ranks 6469

In Carbondale, 111 6617

In nondefense industries 6612

Post-emergency 0477

Proportion of unemployables on W. P. A. rolls 6509, 6511

Relation to priorities 6615, 6624, 6625, 6651, 6652

Voluntary savings plan 6466, 6467

W. P. A. :

Average number of persons on projects June 1940 and June 1941 6507

Cooperation in recruiting farm labor 6497

Cooperation with farm groups 6506

INDEX 6675

Employment — Continued.

W. P. A.— Continued. Pae«

Curtailment 6509, 6515

Definition of an "employable" worker 6517

In farm areas 6505,6506,6511

In relation to defense contracts, 1940 population, by industrial

areas &496

Program for fiscal year 1942 6486

Proportion of unemployables on rolls 6511

Relation to farm labor 6514, 6562

Wages and hours 6510, 6514, 6518

Workers in defense industry 6510, 6513, 6514

Federal Aid {see also Social Security) :

For schools 6523

H. R. 4.545 6521, 6524

Lanham Act 6521, 6522, 6528

Health :

Industrial hygiene 6421, 6423

Low-cost services to meet workers' needs 6425

Occupational environment 6422

Problems arising from defense migration 6421, 6422

Safety programs in defense industry 6423

Venereal disease in defense areas 6422

Housing :

Coordination 6333

Defense :

Distribution in relation to existing community facilities 6523

Lanham Act 6521, 6522

Projects 6626

Detroit as affected by cut in automobile industry 6651

Fair rent committees 6632, 6633r-6635, 6644

Farm labor 6499

Government :

Allotted for private construction during 1940 and first quarter

of 1941 6334, 6337, 6338

Allotments as compared with private building permits 6834

Appropriations 6626,6637

F. S. A. migratory labor camp 6427

Relation to increasing school load 6529

In regard to distribution of orders 6623

Permanency of rent fixing 6653

Power of O. P. A. C. S. in rent fixing 6641

Private building 6333, 63^4, 6335, 6336, 6339, 6340, 6341, 6626

Progress of construction program 6334

Rent control 6322, 6641

Rent increases 6420, 6454, 6476, 6626-6633, 6636-664;^

Rent surveys in selected defense areas, October 1939-June 1941 6628-6632

Rent unit, O. P. A. C. S 6322

Slum clearance 6426

Shortages :

Brownwood, Tex 6418

Buffalo, N. Y 6419

Burlington, Iowa 6419

Construction workers in Army cantonments 6420, 6421

Corpus Christi, Tex 6418

Gadsden, Ala 6418

General 6399,6418

Parsons, Kans 6419

6676 i^DEx

Housing — Continued.

Sliortages — Continued. -Page-
Schenectady, N. Y &420'

Seattle, Wash 6334, 6336

Tacoma, Wash 6420

Various defense areas 6626-

Wichita, Kans 6333, 6336, 6419

Supply of building materials 6670

Temporary 6426

Trade-union collaboration with housing authorities 6455

Types in relation to defense 6333

Industry (see also Employment) :

Accumulation of excessive inventories 6490'

Automobile, curtailment of 6647, 6650

Billion dollars in projects approved by Plant Site Board 6578

Contracts :

Concentration 6483, 6489, 6508.

Decentralization 6615

Distribution of awards 6495-

Distribution of prime defense contracts in relation to concentra-
tion of industry 6548

Distribution of prime defense contracts, June 1, 1940, to May

31,1941 6547

Distribution of War and Navy prime defense contracts by

county 6582-6589

Distribution of War and Navy prime defense contracts by Federal

Reserve district and industrial area 6590-6592

Distribution of War and Navy prime defense contracts by States — 6589

Distribution pattern of orders 6576

Enumeration of 6581-6602.

Factors in distribution of orders 6576

Farming out 6490'

Per capita value 6389

Percentage distribution of prime contracts of War and Navy De-
partments by States 6592:

Pooling facilities to take defense contracts 6616

Problem of areas with few orders 6389-

Regional distribution of industrial facilities financed by War and

Navy Departments and total value of product 6597

Regional distribution of manufactured products and value of prime

contracts and Government-financed facilities 6593-6594

Regional distribution of manufacturing employment, value of con-
tracts, and co.et of Government-financed facilities 6594-6595

Regional distribution of prime contracts of War Department and

total value of manufactured product 6601-6602

Regional distribution of value of prime contracts financed by

War Department 6595-6596

Relation to migration 6311

Relation to 1940 population, W. P. A. employment 6495

Subcontracting , 6384, 6388,

6S90, 6394, 6409-6411, 6608, 6616, 6623, 6625, 6626
Defense :

Cooperation between Army, Navy, and Plant Site Board in plant

site selection 6610, 6611

Data obtained by Plant Site Board 6578

Decentralization 6401, 6564, 6572, 6573

Determining factors in plant location 6565, 6568

Diminishing rate of expansion of defense program 6492

Geographic concentration 6623, 6645

INDEX 6577

Industry — Coiitinued.

Defense — Continued. I'age

Geographic distribution of expansion as of May 15, 1941 6549

Government-financed facilities charts 6556-6559

Government sanctions and pressure 6644

Inflexible distribution of certain industries 6560

Manufacture of clothing for Army 6613

New plant location in relation to housing facilities, labor supply,

community facilities 6610, 6611

Peacetime value a factor in plant location 6580

Plant Site Board 6545, 6579

Plant site selection influenced by expediency and compromise 6607

Plant site selection influenced by labor supply 6580

Plant sites in ghost tovpns 6614

Plants in Middle West 6613

Plants in South 6613

Procedure for clearance of location of new plants defined 6603-6605

Procedure for community seeking plant 6564

Procedure in deciding new plant locations 6577

Shift to defense production 6480

Small business activities 6609

Estimated industrial output for calendar year 1941 6312

Excessive inventories of raw materials 6508

Factors affecting expansion of output 6486

Part-time production 6491

Plant expansion restrictions : 6487

Various nondefense industries curtailed 6647-6654

Inflation 6640,6669

Labor. {See Employment, see Unions, see Industry, see Migration.)
Legislation :
Existing ;

Child labor 6504

Civil-service retirement 6417

Control of Employment Act in Britain 6427

H. R. 5454 6524

Indigent transfer law 6618

Labor contracting 6505

Lanham Act 6521, 6522

Public law 849 6521, 6522

Social security 6417, 6418

Proposed :

Antistrike 6407-6409

Industrial hygiene 6423

Rent control 6641, 6644, 6652

Social security 6444, 6477-6479', 6670

Social security in Britain 6426, 6479

Unemployment compensation 6417

Dstribution of Federal expenditures by regions 6553

EJxpansion of facilities 6551

Percentage distribution of total amount approved, by States 6554

Percentage distribution of total United States investment, by States— 6552

Regional allocation of Plant Site Board approvals 6555

6678

INDEX

Advantages 6416

Agricultural 6571

As a result of W. P. A. cuts 6509

Causes 6464

Checked by F. S. A. loans 6465

Controlled 6383, 6417, 6418, 6571, 6618, 6620

Defense 6310,6620

Minimized through collective bargaining 6385

Minimized through revised defense purchasing 6606

Minimizetl through subcontracting 6608

N. Y. A. (See under United States Government employment.)

Negro 6538

O. P. A. C. S. (See under United States Government.)
O. P. M. (See United States Government.)

Post-emergency dislocation of men and skills 6607

Relation to defense contracts 6311

Uncontrolled 6310, 6311

National Defense Advisory Commission 6623

N. Y. A. {Sec under Employment, Vocational training, and United States
Government. )

Population :

Data with reference to housing 6334

Normal increase as a factor in employment 6509

Post-emergency planning :

Employment prospects 6406, 6425

Federal program of social insui'ance 6478

Housing 6421, 6426, 6476

Industrial prospects 6572, 6607

Labor's stake in planning 6425-6427

National Resources Planning Committee 6468

O. P. M 6406

Peacetime value of defense plants _ 6580

Public works 6466

Schools, social services 6426

Social security 6581

Voluntary savings 6619

Price control. {See under Housing ; see under United States Government.)

Priorities :

Aluminum 6-581

As an alternative to plant expansion 6487

Automobile curtailment 6488, 6581

Building materials 6476, 6670-6672

Civilian preference for essentials 6639, 6647

Countering methods 6625

Effects upon business and labor 6391, 6392

Effects upon labor 6392, 6484, 6488

Machinery 6464

Material shortages, actual and threatened 6484

Materials 6464, 6624-6625

Necessity for maintenance 6649, 6650

O. P. M.'s method of handling labor priorities 6396

Power supply 6581

Restriction on copper 6652

Steel curtailment 6488

Substitute materials 6624, 6647

Recreation problems arising from defense migration 6424,6425

Relief. {See under Public welfare.)

Sanitation in defense areas 6421, 6422

Schools (see also Vocational training) :

Cost of construction 6523

Educational problems arising from defense migration 6423

INDEX 6679

Schools— Coutimied. Pag«

Estimated needs 6520

Facilities survey by United States Office of Education 6519-6529

Financing problems 6524-6527

Needs in defense areas 6519,6522

Plans for financing needed expansion 6521, 6522, 6524

Situation during first World War 6527

Situation in various defense areas 6419

Ways of meeting shortages 6527

Social security :

In England 6426, 6427, 6479

In relation to organized labor 6444

Old-age and survivor's insurance 6417, 6425

Proposed system of social insurance 6477-6179

Special category for defense workers 6477-6479,6670

Unemployment compensation 6416, 6417

Unions :

A. F. of L. :

Agreement between Government agencies and building trades-- 63S4-

6385, 6475

Apprenticeship policy 6472

Benefits 6443, 6444, 6457

Cooperation among trade-union internationals 6461

Cooperation with defense program 6414—6479

Cooperation with employment services 6461

Employment exchange 6459

Initiation fees 6443, 6444, 6445, 6456, 6458, 6459

In relation to social security 6477-6479

Organizational framework 6473, 6474

Policies in relation to defense program 6446

Policies of various unions 6446, 6447-6453

Policy toward Negro 6473-6475

Recruitment of cantonment construction workers 6460, (H61

Survey of conditions in defense areas 6428-6443

Unemployment within ranks 6469

Collective bargaining as check on migration 6385

C. I. O. :

Representation at Atlantic Coast Conference 6388

Representation on O. P. M., Labor Division 6392, 0396

Representation on Shipbuilding Stabilization Committee 6386

Liaison representatives in O. P. M.'s Labor Division 6392, 6395, 6396

Misrepresentation of organized labor 6143-6453

Opposition to labor's effort in defense program 6420

Organized labor's attitude toward Negroes— 6383, 6473-6475, 6531-6533, 6537

Position on compulsory labor contracts and priorities 6464

Stabilization of shipbuilding industry 6385-6391, 6398

Stake in defense planning 6425

Strikes 6402, 6407, 6408

United States Government :

Bureau of Labor Statistics 6312-6332

Department of Agriculture, Marketing Service 6570

Department of Agriculture, Office of Defense Relations 6545, 6569-6571

Department of Agriculture, program of cooperation between State and

Federal agencies for maximum land and labor use 6506

Employment Service 6415, 6561

Federal Security Agency, Vocational Training Section 6344

Fiscal data 6467, 6485, 6492

N. Y. A.:

Out-of-school work program 6371

Projects 6371

Residence of workers by States 6373

Vocational training progi'ams 6344-6345

Office of Education, Vocational Training Section 6344

6680 i-^'i^Ex

United States Government — Continued.

O. P. A. C. S. : Pa^e

Activities and organizational framework €637

Authority 6339

Ceilings on 11 articles 66^14

Civilian preference for essentials 6639

Consumer protection 6638

Cotton goods price control 6642,6652,6653

Exercise of price-fixing authority— 1917-1918 665d, 6666, 6667

"Government control" 6668

Inflation 6669

Price control authority of the President 6654-6.-66

Price dislocation after first World War 6668

Price division 6638

Price fixing as stabilizer of economy 6667

Price of housing 6621-6623

Rent-fixing power 6">40

Rent unit 6322

Responsibilities, scope, functions 6621-(,672

O. P. M. :

Defense contract service 6409

Division of Labor :

Agreement with A. F. of L. building trades unions 6384-6485

Attitude toward labor migration 6310, 6311. 6312

Attitude toward racial discrimination 6381-6383

Efforts to revitalize ghost towns 6388, 6317

Efforts to stimulate subcontracting 6388

Functions 6343

Functions of training-within-industry section 6378

Handling labor priorities 6396

Labor Policy Advisory Committee 6396

Liaison, unions 6392

Method of handling priorities in materials 6391, 6392

New set-up 6394

Responsibilities 6310

Stabilization of shipbuilding industry 6384, 6385-6''88

Division of Purchases 1 6575-6620

Plant Site Board 6563, 6568, 6177-6581, 6603-66;)5, 6309

War and Navy Departments: Distribution of orders and facilities

contracts 6576,6581-6632

W. P. A. (See under Employment.)
Vocational training:

Apprenticeship policy of A. F. of L 6472

Apprenticeship program 6376

Apprenticeship training ,— 6385

Division of Labor, O. P. M., regional training and placement system — 6342
Engineering defense courses:

Allotments and encumbrances by State and institutions 6367-6371

Classification of courses &360

Disbursements by States 6366

Report of month ending April 30, 1941 6359-&371

States and institutions 6320, 6366

Summaries 6360.6361

National defense training programs 6343-6377

Preemployment courses for W. P. A. and N. Y. A. registrants 6350

Preemployment courses for out-of -school youth 6348, 6.349

Preemployment courses for unemployed workers 6347

Preemployment-refresher and supplementary courses 6346

Preemployment-refresher, and supplementary courses by city and
State 6352-6359

INDEX • 6681

Vocational Training — Continued. Pag«

Supplementary course for workers and apprentices 6346

N. Y. A.:

Employment by type of project and State 6372, 6375

Number of certified youths awaiting assignment 6374

Production units 6350, 6372

Program , 6344,6345

Resident centers 6351, 6375

Terminations 6350, 6372

Negro 6346,6382

Within-industry 6342, 6377-6381, 6625

W. P. A. program 6494,6511,6512

Welfare, public:
Relief :

Post-emergency prospects 6607

Load increase due to W. P. A. cuts 6509

W. P. A. curtailment methods and effects 6515

W. P. A., purposes and effects 6514

W. P. A. standards 6518

W. P. A. (See under Employment, Welfare, Vocational Training.)

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