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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 

BEFORE THE 

SELECT COMMITTEE INVESTIGATING 

NATIONAL DEFENSE MIGKATION 

HOUSE OF EEPKESENTATIVES 

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 18 /^ * . 

DETROIT HEARINGS 

(Industrial Section) 

SEPTEMBER 23, 24, 25, 1941 



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





NATIONAL DEFENSE MIGRATION 



HEARINGS 

BEFORE THE 

SELECT COMMITTEE INVESTIGATING 

NATIONAL DEFENSE MIGRATION 

HOUSE OF EEPRESENTATIVES 

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 18 
DETROIT HEARINGS 

(Industrial Section) 

SEPTEMBER 23, 24, 25, 1941 



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






UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHINGTON : 1941 






SELECT COMMITTEE INVESTIGATING NATIONAL DEFENSE 

MIGRATION 

JOHN H. TOLAN, California, Chairman 
LAURENCE F. ARNOLD, Elinois CARL T. CURTIS, Nebraska 

JOHN J. SPARKMAN, Alabama FRANK C. OSMERS, Jr., New Jersey 

Robert K. Lamb, Sstaff Director 

II 



CONTENTS 



Pag« 

List of witnesses vii 

List of authors ix 

Tuesday, September 23, 1941, morning session 7169 

Testimony of Hon. Murray D. Van Wagoner 7069-7077 

Statement by Hon. Murray D. Van Wagoner 7070 

Testimony of Lloyd B. Reid and Fred C. Taylor 7092-7106 

Statement by G. Donald Kennedy 7029 

Testimony of Mrs. Maynard Decent 7109 

Testimony of Albert Peppin 7115 

Testimony of John Lovett, Willis Hall, and Chester A. Cahn 7119 

Statement by John Lovett 7120 

Testimony of John Lovett (resumed) 7138 

Testimony of Willis Hall 7151 

Statement by Willis Hall 7152-7156 

Testimony of Chester A. Cahn 7159-7160 

Statement by Chester A. Cahn 7159 

Tuesday, September 23, 1941, afternoon session 7169 

Testimony of Paul L. Stanchfield 7169-7197 

Statement by Paul L. Stanchfield 7169 

Testimony of Lt. Col. Harold A. Furlong 7213-7224-7231 

Statement by Lt. Col. Harold A. Furlong 7213 

Testimonj' of Raymond Foley 7231 

Testimony of Maj. Ross L. Gardner 7233-7234 

Statement by Maj. Ross L. Gardner 7233^ 

Testimony o'f George Edwards 7239-7249' 

Statement by George Edwards 7240 

Wednesday, Sept. 24, 1941, morning session 7259 

Testimony of R. J. Thomas, James Wishart, George Addes, Victor 

Reuther, Richard Deverall, and Richard Reisinger 7259 

Statement by R. J. Thomas 7260 

Testimony of R. J. Thomas 726S 

Testimony of Lt. Comdr. Walter F. Bade 7294-7296 

Statement by Lt. Comdr. Walter F. Eade 7294 

Testimony of E. B. Hill. (See Pt. 19.) 

Wednesday, Sept. 24, 1941, afternoon session 7305 

Testimony of Ear! E. Raymond 7305-7307 

Statement by Earl E. Raymond 7305 

Testimony of Michigan Automobile Manufacturers (panel) _ 7309-7356-7358 

Statement by C. C. Carlton 7310 

Statement by Robert W. Conder 7322 

Statement by R. I. Roberge .. 7329 

Statement by H. W. Anderson 7336 

Statement by L. Clayton Hill 7350 

Statement by C. E. Weiss 7351 

Statement by Robert Waldron 7352 

Thursday, Sept. 25, 1941, morning session 7389 

Testimony of Abner E. Larned 7389-7414-7422 

Statement by Abner E. Larned 7389 

Testimony of Allen Selwin 7422' 

Testimonj' of Joseph L. Weiner 7424 

Statement by Leon Henderson 7453 

Thursday, September 25, 1941, afternoon session 7463 

Testimony of William Haber 7463- 

Testimony of Harvey Campbell 7485. 

Testimony of Eric Nicol, Edward L. Keenan, and Col. Frank J. 

McSherry 7487-751.> 

in 



IV CONTENTS 

Thursday, September 25, 1941, afternoon session— Continued. Page 

Statement bv Eric Nicol 7488 

Testimony of John Reid 7519-7521 

Statement bv John Reid 7519 

Testimony of Dr. Grover C. Dillman 7524-7540 

Statement by Dr. Grover C. Dilhuan 7524 

Introduction of exhibits 7544 

Exhibit 1. Revenues and Expenditures, State of Michigan, report by 

Vernon J. Brown, auditor general, Lansing, Mich 7545 

Exhibit 2. Health Problems Created by Defense Migration in 
Michigan; report by H. Allen Moyer, M. D., commissioner, depart- 
ment of health, Lansing, Mich 7552 

Exhibit 3. Michigan's Direct Relief Problem; report by John D. 
O'Connell, director. State department of social welfare, Lansing, 

Mich -^-w--- '^^^^ 

Exhibit 4. Categorical Assistance in Michigan; report by F. F. Faun, 

supervisor. State bureau of social security, Lansing, Mich 7565 

Exhibit 5. Defense Housing in Michigan; report by Division of De- 
fense Housing Coordination, Executive Office of the President, 

Washington, D. C 7568 

Exhibit 6. Problem of School Housing in Michigan; report by Eugene 
B. Elliott, superintendent. State of Michigan Department of Public 

Instruction, Lansing, Mich ,-"",,",:"" ^^'^^ 

Exhibit 7. Training Within Industry in Michigan; report by Milton 
M. Olander, district representative; O. F. Carpenter, associate dis- 
trict representative; Carl D. Wheaton, assistant district representa- 
tive, district No. 13, Michigan, and Lucas County, Ohio; Office of 
Production Management, Training Within Industry Branch, Labor 

Division -- - ' ^ ' " 

Exhibit 8. Program of Vocational Training for Defense Workers in 
Michigan; report by George H. Fern, director, Michigan State 

Board of Control for Vocational Education, Lansing, Mich 7575 

Exhibit 9. Priorities Unemplovment and Need in Michigan; report by 
Labor Division, Work Projects Administration, Federal Works 

Agency, Washington, D. C -,- ; - t" 

Exhibit 10. In-Migrant Applicants for Michigan Automobile Licenses; 
report bv Michigan historical records survey project. Work Projects 

Administration, Federal Works Agency, Detroit, Mich -- 7587 

Exhibit 11. Health Problems Created by Defense Migration in De- 
troit; report bv Bruce H. Douglas, M. D., commissioner, depart- 
ment of health; Detroit, Mich r'-r^W ' 

Exhibit 12. Migration and Public Welfare in Detroit; report by G. K. 
Harris, general superintendent, department of public welfare, 

Detroit. Mich 1:'-;,-;^^^^- ^^^ 

Exhibit 13. Survev on Migration to Detroit, September 3-lb, 1941; 
report by John F. Ballenger, manager. Bureau of Old-age As.sistance, 
Social Security Board, Federal Security Agency, Detroit, Mic^i 7b6b 

Exhibit 14 Purpose and Activities of the Homes Registration Office, 
Detroit, Mich.; report bv Stuart E. Walker, supervisor homes 
registration, office of the housing commission, Detroit, Mich__---- 7b6b 
Exhibit 15. Detroit School Needs Created by Defense Migration; 
report bv Dr. Frank Codv, superintendent of public schools, board 

of education, Detroit, Mich V"- Vt':-"""'i 

Exhibit 16. Detroit's Vocational Education Program for National 
Defense; report by Warren E. Bow, deputy superintendent of public 

schools, board of education, Detroit, Mich ;,----.- :v- 

Exhibit 17 Priorities Unemplovment and Need in Detroit; report by 
Labor Division, Work Projects Administration, Federal Works 

Agency, Washington, D. C ^-- -_ 

Exhibit 18. Automobile Manufacture and the Defense Program; re- 
port by William J. Cronin, secretary, manufacturers committee, 

Automobile Manufacturers Association, Detroit, Mich 'ooo 

Exhibit 19. Employment in Airplane Parts Division of Automobile 
Parts Factory; report by H.J. Roesch, director of industrial rela- 
tions, Briggs"Manufacturing Co., Detroit, Mich 'ooo 



CONTENTS V 

Introduction of exhibits — Continued. Pag* 

Exhibit 20. Defense Employment in Automotive and Refrigerator 
Plants; report by Lewis D. Burch, director cf industrial relations, 
Nash-Kelvinator Corporation, Detroit, Mich 7667 

Exhibit 21. Denial cf Employment to Aliens; report by Florence G. 
Cassidy, secretary, nationality committee, Council of Social Agen- 
cies of Metropolitan Detroit 7670 

Exhibit 22. Effect of National Defense on Negro Employment in 
Detroit; report by Gloster B. Current, executive secretary, Detroit 
branch, National Association for the Advancement of Colored 
People, Detroit, Mich 7670 

Exhibit 23. Advertising in Detroit to Fill California Jobs; paid notice 
in Detroit News, September 9, 1941, by Michigan State Employ- 
ment Service 7673 

Exhibit 24. National Defense in Plymouth, Mich.; report by C. H. 

Elliott, city manager, Plymouth, Mich 7674 

Exhibit 25. Social Welfare in Wayne County; report by Walter J. 
Dunne, director, department of social welfare, Wavne County, 
Mich ; 7678 

Exhibit 26. Effect of Defense Migration on Community Facilities of 
Macomb County, Mich.; report by Charles N. McNaughton, 
chairman; Leo R. Jean, vice chairman; and Isaac Hartung, secretary, 
Macomb County Board of Social Welfare, Mount Clemens, Mich'- 7688 

Exhibit 27. Unsanitary Conditions Caused by Migration of Workers 
into Royal Oak Township, Mich.; report by George H. Briggs, chair- 
man, and E. G. Phipps, secretary, John R Council; Improvement 
Associations Committee, Royal Oak Township, Mich 7693 

Exhibit 28. Need of Defense Housing in Pontiac, Mich.; report by 
Roy E. Reuther, international representative, United Automobile, 
Aircraft, and Agricultural Implement Workers, Congress of Indus- 
trial Organizations, Pontiac, Mich 7695 

Exhibit 29. Need for Federal Assistance to Enlarge Hospital Facilities 
in Bay City, Mich.; report by J. Harry Nelson, city manager, city 
of Bay City, Mich 7696 

Exhibit 30. National Defense Contracts in Bay City, Mich.; report 
by A. J. Maxwell, Bay City Chamber of Commerce, Bay City 
Mich . 7697 

Exhibit 31. National Defense Training in Bay City Public Schools; 
report bv Benjamin Klager, superintendent of schools. Bay City, 
Mich 7698 

Exhibit 32. National Defense Migration Since June 1940 and School 
Statistics 1937-41, for Midland, Mich.; report by J. J. Shafer, 
superintendent of schools, Midland, Mich 7701 

Exhibit 33. Defense Migration in Midland, Mich.; report by R. S. 
Philip, acting secretary, Midland Chamber of Commerce, Midland, 
Mich 7702 

Exhibit 34. Defense Industry and Hospital Facilities in Saginaw, 
Mich.; report by Frank N. Andersen, chairman, building committee, 
Saginaw General Hospital, Saginaw, Mich 7703 

Exhibit 35. Community Facilities Needed in Saginaw, Mich.; report 

by Carl H. Peterson, city manager, Saginaw, Mich 7704 

Exhibit 36. School Needs in Saginaw, Mich.; report by Chester F. 

Miller, superintendent of schools, Saginaw, Mich 7706 

Exhibit 37. Defense Migration in Battle Creek, Mich.; report by 

Floyd H. Barry, mayor, city of Battle Creek, Mich 7712 

Exhibit 38. Effect of Defense Migration on Public Schools of Battle 
Creek, Mich.; report by Eldon C. Geyer, superintendent of schools. 
Battle Creek, Mich 7714 

Exhibit 39. Defense Industry and Migration in Muskegon, Mich.; re- 
port by John C. Beukema, secretary-manager. Greater Muskegon 
Chamber of Commerce, Muskegon, Mich 7715 

Exhibit 40. Overload of Hackley Hospital, Muskegon, Mich.; report 
by Amy Beers, R. N., superintendent of Hackley Hospital, Muske- 
gon, Mich 772 1 



yi CONTENTS 

Introduction of exhibits— Continued. _. . c^ ^"^ 

Exhibit 41. Defense Housing in Muskegon, Mich.; report by *^ugene 
A Krauss, housing manager, Defense Housing Division of Federal 
Works Agency, Muskegon, Mich -,-\^-^ ;^""V" 

I^xhibit 42 Housing Data and School Census of Muskegon County, 
Mich.; report by James Ten Brink, superintendent of Muskegon 
County public schools, Muskegon, Mich - - - - =- - - - ------ '733 

Exhibit 43 Defense Employment in Kalamazoo, Mich.; letter from 

Kalamazoo Chamber of Commerce, Kalamazoo, Mich 7734 

Exhibit 44 Nondefense Industrial Problem in Muncie, Ind.; report by 
Lester C. Bush, manager, Muncie Chamber of Commerce, Muncie, 

T J / I oO 

Exhibit 45." Airplane Engine and Cargo Truck Manufacture; report by 

the Studebaker Corporation, South Bend, Ind - - - - - - - - - - - 774 J 

Exhibit 46. Effect of Cut in Automotive Output on Glass Indiistry 
(A)- report by H. H. Baker, vice president, Libbey-Owens-Ford 
Glass Co., Toledo, Ohio p^---YW'V' 

Exhibit 47. Effect of Cut in Automotive Output on Glass Industry 
(B)- report by Leland Hazard, general counsel, Pittsburgh Plate 
Glass Co., Pittsburgh, Pa ''^^ 



LIST OF WITNESSES 

Detroit Hearings, September 23, 24, 25, 1941 

Pag« 

Addes, George, international secretary-treasurer. United Automobile, 
Aircraft, and Agricultural Implement Workers of America, Congress of 
Industrial Organizations, Detroit, Mich 7259 

Cahn, Chester A., secretary, Automobile Tool & Die Manufacturers Asso- 
ciation, Detroit, Mich 7119 

Campbell, Harvey, executive vice president, Detroit Board of Commerce, 

Detroit, Mich 7485 

Carlton, C. C, president, Automotive Parts & Equipment Manufac- 
turers, Inc., Detroit, Mich 7358 

Conder, Robert W., Chrysler Corporation, 341 Massachusetts, Detroit, 

Mich 7356 

Decent, Mrs. Maynard, 622 Sanford Street, Muskegon Heights, Muske- 
gon, Mich 7109 

Deverall, Richard, educational department. United Automobile, Aircraft, 
and Agricultural Implement Workers of America, Congress of Indus- 
trial Organizations, Detroit, Mich 7259 

Dillman, Dr. Grover C, president, Michigan College of Mining and Tech- 
nology, Houghton, Mich 7524 

Eade, Lt. Comdr. Walter F., United States Naval Reserve, inspector of 

naval aircraft, United States Navy, Detroit, Mich 7292 

Edwards, George, director-secretary, Detroit Housing Commission, 

Detroit, Mich 7239 

Furlong, Lt. Col. Harold A., administrator, Michigan Council of Defense, 

Lansing, Mich 7213 

Gardner, Maj.-Ross L., Automotive I^iaison Section, Central Procurement 

District, United States Army Air Corps, Detroit, Mich 7233 

Haber, William, professor of economics. University of Michigan, Ann 

Arbor, Mich 7463 

Hall, Willis H., manager, industrial department, Detroit Board of Com- 
merce, Detroit, Mich 7119 

Hill, L. Clavton, Murrav Corporation of America, 7700 Russell Street, 

Detroit, Mich '. 7357 

Keenan, Edward L., acting chairman. Regional Labor Supply Committee, 

Office of Production Management, Cleveland, Ohio., 7487 

Larned, Abner E., State administrator. Work Projects Administration, 

Federal Works Agency, Lansing, Mich 7389 

Lovett, John, general manager, Michigan Manufacturers Association, 1001 

National Bank Building, 'Detroit, Mich 7119 

McSherry, Col. Frank J., director, defense training. Office of Production 

Management, Cleveland, Ohio 7487 

Nicol, Eric, acting chief. Labor Supply Branch, Office of Production 

Management, Washington, D. C 7487 

Peppin, Albert, 1900 Commerce Street, Muskegon, Mich 7115 

Ravmond, Earl, president. Trailer Coach Manufacturers Association, 

Saginaw, Mich - - 7305 

Reid, John, secretary, Michigan State Federation of Labor, Detroit, 

Mich . 7519 

Reid, Lloyd B., deputy commissioner. State highway department, Lan- 
sing, Mich 7092 

Reismger, Richard, international board member, United Automobile, 
Aircraft, and Agricultural Implement Workers of America, Congress of 
Industrial Organizations, Detroit, Mich 7259 

Reuther, Victor, assistant secretarj^-treasurer. United Automobile, Air- 
craft, and Agricultural Implement Workers of America, Congress of 
Industrial Organizations, Detroit, Mich 7259 

vn 



VIII CONTENTS 

Page 

Roberge, R. I., office of Edsel Ford, Ford Motor Co., 15000 Woodward Ave- 
nue, Detroit, Mich 7356 

Selwin, Allen, district employment officer, Work Projects Administration, 

Detroit, Mich 7422 

Stanchfield, Paul L., chief of research, statistics and planning section, 

Michigan Unemployment Compensation Commission, Detroit, Mich — 7169 

Taylor, Fred C., planning engineer. State highway department, Lansing, 

Mich 7092 

Thomas, R. J., international president. United Automobile, Aircraft, and 
Agricultural Implement Workers of America, Congress of Industrial Or- 
ganizations, Detroit, Mich 7259 

Van Wagoner, Murray D., Governor of the State of Michigan, Lansing, 

Mich 7069 

Waldron, Robert, Hudson Motor Car Co., 12601 East Jefferson Avenue, 

Detroit, Mich 7357 

Weiner, Joseph L., Civilian Supplv Division, Office of Production Manage- 
ment, Washington, D. C 7424 

Weiss, C. E., personnel director, Packard Motor Car Co., East Grand 

Boulevard, Detroit, Mich 7359 

Wilson, C. E., president. General Motors Corporation, Detroit, Mich 7356 

Wlshart, James, research department, United Automobile, Aircraft, and 
Agricultural Implement Workers of America, Congress of Industrial Or- 
ganizations, Detroit, Mich 7259 



LIST OF AUTHORS 

Of Prepared Statements and Exhibits 

Andersen, Frank N., chairman, building committee, Saginaw General Page 
Hospital, Saginaw, Mich 7703 

Anderson, H. W., General Motors Corporation, Detroit, Mich 7336 

Baker, H. H., vice president, Libbey-Owens-Ford Glass Co., Toledo, 

Ohio 7744 

Ballanger, John F., manager, Bureau of Old-Age Assistance, Social Security 

Board, Federal Security Agency, Detroit, Mich 7635 

Barry, Floyd H., mayor, city of Battle Creek, Mich 7712 

Beers, Amy, R. N., superintendent of Hackley Hospital, Muskegon, 

Mich___J 7721 

Beukema, John C, secretary-manager. Greater Muskegon Chamber of 

Commerce, Muskegon Chamber of Commerce, Muskegon, Mich 7715 

Bow, Warren E., deputy superintendent of public schools, board of educa- 
tion, Detroit, Mich 7652 

Briggs, George H., chairman. Improvement Associations Committee, 

Royal Oak Township, Mich 7693 

Brown, Vernon J., auditor general, Lansing, Mich 7545 

Burch, Lewis D., director of industrial relations, Nash-Kelvinator Cor- 
poration, Detroit, Mich 7667 

Bush, Lester C, manager, Muncie Chamber of Commerce, Muncie, Ind-_ 7735 

Cahn, Chester A., secretary. Automotive Tool & Die Manufacturers 

Association, Detroit, Mich 7159 

Carlton, C. C., Motor Wheel Corporation, and president. Automotive 

Parts & Ecjuipment Manufacturers, Inc., Detroit, Mich 7310 

Carpenter, O. F., associate district representative, district No. 13, Michi- 
gan, and Lucas County, Ohio, Training Within Industry Branch, Labor 
Division, Office of Production Management 7570 

Cassidy, Florence G., secretary, nationality committee, Council of Social 

Agencies of Metropolitan Detroit 7670 

Cody, Dr. Frank, superintendent of public schools, board of education, 

Detroit, Mich 7643 

Conder, director of labor relations, Chrysler Corporation, Detroit, Mich-. 7322 

Cronin, William J., secretary, manufacturers' committee. Automobile 

Manufacturers Association, Detroit, Mich _ 7665 

Current, Gloster B.. executive secretary, Detroit branch, National Asso- 
ciation for the Advancement of Colored People, Detroit, Mich 7670 

Dillman, Dr. Grover C, president, Michigan College of Mining and 

Technology, Houghton, Mich 7525 

Division of Civilian Supply, Office of Production Management, Washing- 
ton, D. C 7453 

Division of Defense Housing Coordination, Executive Office of the Presi- 
dent, Washington, D. C 7568 

Douglas, Bruce H., M. D., commissioner, department of health, Detroit, 

Mich 7603 

Dunne, Walter J., director, department of social welfare, Wayne County, 

Mich 7678 

Fade, Lt. Comdr. Walter F., United States Naval Reserve, inspector of 

naval aircraft. United States Navy, Detroit, Mich 7294 

Edwards, George, director-secretary, Detroit Housing Commission, 

Detroit, Mich 7240 

Elliott, C. H., city manager, Plymouth, Mich 7674 

Elliott, Eugene B., superintendent. State of Michigan Department of 

Public Instruction, Lansing, Mich 7570 

Fauri, F. F., supervisor. State bureau of social security, Lansing, Mich 7565 

Fern, George H., director. Michigan State Board of Control for Vocational 

Education, Lansing, Mich 7575 

IX 



X CONTENTS 

Page 

Furlong, Lt. Col. Harold A., administrator, Michigan Council of Defense, 

Lansing, Mich 72 13 

Gardner, Maj. Ross L., automotive liaison section, central procurement 

district, United States Army Air Corps 7233 

Geyer, Eldon C, superintendent of schools, Battle Creek, Mich 7714 

Hall, Willis L., manager industrial department, Detroit Board of Com- 
merce, Detroit, Mich 7152 

Harris, G. R., general superintendent, department of public welfare, 

Detroit, Mich 7608 

Hartung, Isaac, secretary, Macomb County Board of Social Welfare, 

Mount Clemens, Mich 7688 

Hazard, Leland, general counsel, Pittsburgh Plate Glass Co., Pittsburgh, 

Pa 7745 

Hill, L. Clayton, general manager, Murray Corporation of America 7350 

John R. Council, of Improvement Associations Committee, Royal Oak 

Township, Mich 7693 

Kalamazoo Chamber of Commerce, Kalamazoo, Mich 7734 

Kennedv, G. Donald, Michigan State highway commissioner, Lansing, ^fi 
Mich: 7092 

Klager, Benjamin, superintendent of schools. Bay City, Mich 7698 

Krauss, Eugene A., housing manager, Defense Housing Division of Federal 

Works Agency, Muskegon, Mich 7726 

Labor Division, Work Projects Administration, Federal Works Agency, 

Washington, D. C 7585 

Lamed, Abner E., Michigan State administrator. Work Projects Adminis- 
tration, Federal Works Agency, Lansing, Mich 7389 

Lovett, John L., general manager, Michigan Manufacturers Association, 

Detroit, Mich 7120 

Maxwell, A. J., Bay City Chamber of Commerce, Bay City, Mich 7697 

McNaughton, Charles N., chairman, Macomb County Board of Social Wei- 
faro, Mount Clemens, Mich 7688 

Michigan historical records survey project. Work Projects Administration, 

Federal Works Agency, Detroit, Mich 7587 

Michigan State Employment Service 7673 

Miller, Chester F., superintendent of schools, Saginaw, Mich 7706 

Moyer, H. Allen, M. D., commissioner, department of health, Lansing, 

Mich 7552 

Nelson, J. Harry, city manager, city of Bay City, Mich 7696 

Nicol, Eric A., acting chief, Labor Supply Branch, Labor Division, OflSce 

of Production Management, Washington, D. C 7488 

O'Connell, John D., director, State department of social welfare, Lansing, 

Mich 7556 

Olander, Milton M., district representative, district No. 13, Michigan, and 
Lucas County, Ohio, Training Within Industry Bmnch, Labor Division, 
Office of Production Management 7570 

Patton, Prof. Harold S., Michigan State College, East Lansihg, Mich 7213 

Peterson, Carl H., city manager, Saginaw, Mich 

Philip, R. S., acting secretary. Midland Chamber of Commerce, Midland, 

Mich 7702 

Phipps, E. G., secretary. Improvement Associations Committee, Royal Oak 

Township, Mich 7693 

Raymond, Earl E., president, Trailer Coach Manufacturers Association, 

Saginaw, Mich 7305 

Reid, John, secretary, Michigan State Federation of Labor, Lansing, 

Mich 7519 

Reuther, Roy E., international representative, United Automobile, Air- 
craft, and Agricultural Implement Workers, Congress of Industrial 
Organizations, Pontiac, Mich 7695- 

Roberge, R. I., of the office of Edsel Ford, Ford Motor Co., Dearborn, 

Mich 7329 

Roesch, H. J., director of industrial relations, Briggs Manufacturing Co., 

Detroit, Mich 7666 



CX)NTENTS XI 

Page 

Shafer, J. J., superintendent of schools, Midland, Mich 7701 

Stanchfield, Paul L., chief of research, statistics and planning section, 

Michigan Unemployment Compensation Commission, Lansing, Mich.. 7169 

Studebaker Corporation, South Bend, Ind 7742 

Ten Brink, James, superintendent of Muskegon County public schools, 

Muskegon, Mich 7733 

Thomas, R. J., international president, United Automobile, Aircraft, and 

Agricultural Implement Workers, Congress of Industrial Organizations, 

Detroit, Mich 7260 

Training Within Industry' Branch, Labor Division, Office of Production 

Management 1 7570 

Van Wagoner, Hon. Murray D., Governor of Michigan, Lansing, Mich 7070 

Waldron, Robert, personnel director, Hudson Motor Car Co., Detroit, 

Mich 7352 

Walker, Stuart E., supervisor, homes registration, office of the housing 

commission, Detroit, Mich 7635 

Weiss, C. E., personnel director, Packard Motor Car Co., Detroit, Mich-_ 7351 
Wheaton, Carl D., assistant district representative, district No. 13, 

Michigan, and Lucas County, Ohio, Training Within Industry Branch, 

Labor Division, Office of Production Management 7570 



For greater convenience the Detroit hearings are pubhshed in two 
volumes. This vohime, under the title, "Part 18. Detroit Hearings 
(Industrial Section)," includes the testimony of all witnesses except 
Prof. E. B. Hill, of the farm-management department of Micliigan 
State College, who appeared before the committee to discuss agricul- 
tural migration and related subjects exclusively. Dr. Hill's testi- 
mony, together with his prepared statement and other papers dealing 
with various phases of Micliigan agricultural migration, appears in 
the second volume of these hearings, under the title, "Part 19. Detroit 
Hearings (Agricultural Section)." 



NATIONAL DEFENSE MIGEATION 



TUESDAY, SEPTEMBER 23, 1941 

House of Representatives, 
Select Committee Investigating 

National Defense Migration, 

Washington, D. C. 
morning session 

The committee met at 9:30 a. m., in the Federal Building, 
Detroit, Mich., pursuant to notice. Representative John H. Tolan 
(chairman) presiding. 

Present were: Representatives John H. Tolan (chairman), of 
California; Laurence F. Arnold, of lUinois; Frank C. Osmers, Jr., of 
New Jersey; Carl T. Curtis, of Nebraska, all as members of the com- 
mittee; and, as guest of the committee. Representative Fred L. 
Craw^ford, of Michigan. 

Also present: Dr. Robert K. Lamb, staff director; John W. Abbott, 
chief field investigator; Francis X. Riley and Jack B. Burke, field 
investigators; and Ruth B. Abrams, field secretary. 

The t^HAiRMAN. The committee will please come to order. I wish 
to announce for the record that Mayor Edward J. Jeffries is absent 
from the city of Detroit. His secretary, Mr. Alfred S. Colmski, has 
extended to us every courtesy. 

Governor Van Wagoner, you wUl be our first witness. 

TESTIMONY OF HON. MURRAY VAN WAGONER, GOVERNOR OF 
THE STATE OF MICHIGAN 

The Chairman. Governor Van Wagoner, I would like to say to you 
at the beginning of this hearing that your prepared statement has been 
gone over carefully, and I think it is a very valuable contribution to 
the record of this committee. 

I might explain briefly, Governor, that this committee was origi- 
nally known as the Select Committee to Investigate the Interstate 
Migration of Destitute Citizens. 

We started our hearings in New York, knowing that it was not just 
Cahfornia which had that problem to face, and we heard Mayor 
LaGuardia inform us that the State of New York had spent millions 
of dollars for the care of nonsettled citizens, and that hundreds^of 
such citizens had been transported to their homes. 

From New York we went to Montgomery, Ala.; Lincoln, Nebr.; 
Chicago ; Oklahoma City ; San Francisco, and Los Angeles. We found 
that there were about 4,000,000 people on the road, traveling between 
States. 

7069 



7070 DETROIT HEARINGS 

We are not interested in the perennial tramp or the hobo, but we 
are interested in these people who take to the road on account of cir- 
cumstances over which they have no control. You know as well as 
we do that those citizens lose their residence status in the States from 
which they have come, and do not gain residence ui another State 
for years. Millions of our people are thus made Stateless, homeless, 
and voteless. 

It is intercstuig to note. Governor, that there are 28 States in the 
Union which make it a crime to transport a poor or indigent person 
across State lines. 

We have reported to Congress on the problems arising from that 
situation. The committee was continued this session to investigate 
and report on the migration of workers as a result of the national- 
defense program. And that is why we are in Detroit. In this latter 
phase of our inquiry, we have held similar hearings in San Diego, 
Hartford, Trenton and Baltimore, and in Washington. We are 
trying to pin down the factors of danger and risk to both your own 
community and the national welfare, as they are uncovered in our 
investigation of national-defense migration. One thought I wish to 
convey at the outset is that we have come here to Detroit not to 
''show up" Michigan, or Detroit, but simply, in a cooperative way, 
to get the facts. We have never issued a subpena. We have never 
attempted to cross-examine anyone. In other words, Governor, we 
are in Detroit for these purposes: First, to find out the character and 
extent of this shift from nondefensc to defense areas as it affects the 
State of Michigan; and second, to see if we cannot in some way bring 
out a plan to cushion the shock when the national-defense program is 
completed. 

To my right is Congressman Arnold of Uluiois, and to my left is 
Congressman Osmers of New Jersey. Congressman Curtis will be 
here shortly. 

Governor V.\n Wagoner. Mr. Chairman and members of the 
conmnittee. I would like to put in the record, if I may. the fact that 
I think your committee is moving on very sound ground in gomg 
about from State to State and getting the facts in regard to this 
problem, rather than requiring the people of tlie States to go to 
Washington to give their testimony, as is so often done. I am sure 
that the MTtnesses feel more at liberty to say what they want to 
say. And then there is also, of course, the cost. It involves a con- 
siderable expenditure of money and time in requiring people from 
the various States to travel great distances in order to cover this 
problem. 

This is my first experience in testifying before a congressional 
committee in the State of Michigan, and I want to comphment you 
and the members of your committee for taking this broad-minded 
stand and going about the country to seek this information. 

(The statement submitted by Governor Van Wagoner is as follows:). 

STATEMENT BY HON. MITRRAY D. VAN WAGONER, GOVERNOR OF 
THE STATE OF MICHIGAN 

As tiie first wituess at the Michigan hearing, I understaud my benL service tt» 
this important iiKjuiry will be in presenting an over-all account of how the defense 
program in all its ramifications is affecting the normal economy of Michigan. 

During the past year there has been an almost uninterrupted rise in employ- 
ment and prnduction in Michigan's factories. Thousands of workers have been 



NATIONAL. DEFENSE MIGRATION 7071 

absorbed in defense work, as Michigan plants took part in the expanding produc- 
tion of tanks, planes, and other defense materials. At the same time a rising 
national income has raised our production of automobiles and consumers goods to 
boom-time levels. 

With thousands of new jobs created by these two forces, Michigan's factories 
have served as magnets for the migration of thousands of workers from rural 
Michigan and other States. Many of these migrants have been unsuccessful in 
the search for work, since our employers have given preference to local workers in 
filling new jobs. In some cases, where the local labor supply was insufficient, 
migrants did find work and settled near the new defense plants, creating serious 
problems of overcrowding, and pressure on inadequate facilities for sanitation, 
schools, roads and other public services. 

A new type of migration will be our principal problem in the immediate future. 
Production quotas for the automobile industry, which will reduce the output of 
automobiles by 48 percent in December and perhaps as much as 75 percent by 
next spring, will ehminate at least 150,000 or 200,000 jobs in nondefense produc- 
tion. Shortages of critical materials must be expected to cause serious lay-ofls 
also in nonautomotive industries. 

Increases in defense employment during the next few months will fall far short 
of offsetting the displacement of workers from civilian production. Without addi- 
tional contracts, close to 100,000 may be unemployed in January. This disloca- 
tion will create a very real danger of outward migration, as industrial workers 
move back to their former homes or travel to other areas in search of work. One 
of our main problems will be to prevent this out-migration from having undesirable 
results and in leaving a shortage of workers when our defense production reaches 
its peak in 1942. 

The shift from civilian to defense production will also cause major problems in 
this State by cutting into expected revenues from the sales tax and other sources; 
by greatly expanding the cost of relief and Work Projects Administration employ- 
ment; and by endangering the small nondefense industries which furnish the life- 
blood of the smaller towns and cities throughout the Statt. I think that these 
problems can be solved, but the solution will require the whole-hearted coopera- 
tion of Government, industry, and labor. 

MIGRATION AND GROWTH OF POPULATION 

Migration has played a vital part in Michigan's growth from a population of 
2,420,982 in 1900, to 5,256,106 at the time of the 1940 Federal census. From 
1900 to 1930, the rise of large-scale industry and the decline of agriculture, lumber- 
ing, and mining caused not only a vast influx of labor from outside the State, 
but also caused migration of rural Michigan residents to the industrial areas of 
southern Michigan. In that period, Michigan changed from a rural people to 
one 66 percent urban. 

The depression years from 1930 to 1935 reversed this trend to the cities and 
reduced tlie urban population to 65.7 percent of the total. Since 1935 the resump- 
tion of industrial expansion again has reversed the trend, so that today nearly 
75 percent of Michigan's population is concentrated in cities of 2,500 or more. 

Nearly half of Michigan's present population today is in the five contiguous 
counties of the Detroit metropolitan area in the southeastern corner of the State. 
This industrial empire has two- thirds of the State's 6,000 factories, two-thirds of 
the State's 900,000 workers engaged in manufacture, and two-thirds of the State's 
225,000 industrial defense workers. 

The importance of automotive manufacture, Michigan's leading industry, is 
best shown by industrial distribution of Michigan's pay-roll totals for 1940. Of 
the $1,908,000,000 total of all State pay rolls covered by the Unemployment Com- 
pensation Act for 1940, $1,200,000,000', or 63 percent.'was in wages in the auto- 
motive industry and those steel ana machinery plants which depend almost 
exclusively on the auto industry for markets. 

INDUSTRIAL EMPLOYMENT IN MICHIGAN 

Three-quarters of all industrial employment in Michigan is either in the auto- 
mobile industry or in groups directly dependent on automobile manufacturing. 
If industrial transition unemployment Is large, or of long duration, at least 40 
nonmanufacturing jobs are wiped out for each 100 factory jobs which are elim- 
inated. 

Outside of the five-county southeastern industrial area, other major defense 
and manufacturing centers are in Flint, Saginaw, .Jackson, Kalamazoo, Bay City, 



7072 DETROIT HEARINGS 

Lansing, Grand Rapids, and Muskegon — all in the southern half of the Lower 
Peninsula. 

This lower section of Michigan, containing the bulk of population and manu- 
facture, also has the larger share of the State's 225,000 farm families. 

North of the Bay City-Muskegon line, and including all of the Upper Peninsula, 
about half of the total acreage has reverted to the State through property-tax 
delinquency. This is the cut-over timberland. In the last decade, it has shown 
a general revival of growth because of new agricultural activities and increasing 
tourist and resort trade. 

Northern Michigan's chief industry — which now has become second only to 
automobile manufacture as a source of income to the State's residents — is this 
tourist and resort trade. The recent season was the best in history, with twice 
as many tourists motoring to Michigan each year as come to Arkansas, the 
second largest mecca of motoring vacationists. Fully 80 percent of our population 
in the northern part of the State depends on tourist business to sustain itself. 

For many years certain Upper Peninsula counties have had a widespread 
unemployment problem because copper mining had reached unworkable levels 
for the price of the production. Because of the importance of copper to the 
defense program, Michigan recently has received promises of a price differential 
which will permit reopening of the mines, and employment of the workers. There 
is need for quick action here, because wholesale and undesirable emigration from 
the copper area will result otherwise, to the detriment of the defense program 
needs. 

STATE TAX REVENUES AND DISTRIBUTION 

Two financial trends in Government highlighted the last decade. 

First was the demand for more social assistance, which increased expenditures 
by Federal, State, and local Governments in Michigan $200,000,000 a year, so 
that bv 1940 the combined governmental expenditures for all purposes topped 
$550,000,000. 

Second was the ineflt'ective public demand for economies, which resulted only 
in the shifting of financial burdens from local government to State and Federal 
agencies. 

By 1934, the break-down of the general property tax resulted in Michigan 
becoming one of 13 States which now leave this source of taxation entirely to 
local governments. Whereas school property taxes previously had been as high 
as 22 mills, today the average is about 7 mills. Whereas total property tax 
formerly reached up to 40 mills, today, b}- State constitutional amendment, 15 
mills is the limit to which the real property tax can rise. 

Ten years ago. State contributions to local government were $33,000,000 a year. 
For the last fiscal year, ending June 30, 1941, State aid to local units of govern- 
ment totaled over $121,000,000 and represented 60 percent of all State operating 
costs. Federal grants represented nearly $15,000,000 of this State-aid total and 
does not include other Federal expenditures for such enterprises as Work Projects 
Administration, Public Works Administration, and Civilian Conservation Corps. 

The State deficit amounted to nearly $30,000,000 on last January 1, and today 
has been reduced to about $12,000,000, chielly because of a spurt in sales-tax col- 
lections. 

Michigan's State tax sources are the most sensitive to economic conditions of 
any State, because we are unique in depending on the sales tax for 69 percent of 
general fund revenues. 

Automobile license fees and gasoline taxes are reserved by constitutional amend- 
ment exclusively for road building and maintenance, and cannot be used for gen- 
eral governmental purposes. 

Four functions account for 87 percent of State expenditures — education, social 
aid, highways, and institutions such as hospitals and jails. 

State governmental administration costs have increased only 1 percent in the 
last decade. Ilie remainder of the 100-percent increase in State expenditures 
in the last decade was taken up 75 percent by aid to local governments and 24' 
percent by State purchasing and new revolving funds, the principal one being for 
the Liquor Control Commission. 

EFFECTS OF DEFENSE PROGRAM ON STATE FINANCES 

Since Michigan depends so heavily on the 3-percent sales tax, and since this 
tax cannot be collected on defense items or even on federally sponsored defense 
plant construction materials, Michigan's financial stability depends on whether 
our citizens are permitted to continue spending a reasonable percentage of their 
wages on nondefense items. 



NATIONAL DEFENSE MIGRATION 7073 

Food sales today bring in 29 percent of the sales-tax revenue; automobiles and 
accessories, 21 percent; building materials, 6 percent; wearing apparel, 6 percent; 
furniture and household appliances, nearly 4 percent; general merchandise, 14 
percent, and miscellaneous items, 20 percent. 

Durable goods thus constitute roughly 40 percent of the total sales-tax source. 
Any drastic curtailment of such production will directly and most adversely 
affect the main source of State revenue, unless a reasonable buying shift results 
to nondurable goods. 

The sales-tax picture has been blight this year. For the 1942-43 period, the 
outlook is dehnitely dangerous for Michigan finances. Our budget requires an 
annual sales-tax revenue of nearly $70,000,000. 

Because of Michigan's dependence on tourist income as its second largest in- 
dustry, and because highway travel is the main method of generating this tourist 
business, severe rationing of gasoline or complete shut-down of the production 
of new cars, would have critical reactions on the State welfare picture. 

Welfare appropriations, paid jointly by the State and counties, will be adequate 
for the expected hardships of the 56-percent automobile production cut in De- 
cember, which we estimate will add 25,000 families temporarily to the relief rolls. 
But if defense employment does not absorb the slack in a reasonably short time, 
supplemental welfare appropriations will be necessary. Relief rolls are at a 
10-year low today, although that is partly due to the shift to categorical relief and 
Work Projects Administration. 

There is no gasoline shortage apparent for Michigan or the Midwest. Our own 
oil fields are expanding production. We look for a good tourist year in 1942, but 
if adverse conditions develop, our welfare and unemployment load will rise 
tremendously. 

Higher wages and rising costs of living due to defense influences are creating 
strain on State pay rolls and social programs. Recently our State civil-service 
commission found it necessary to adjust upward to a $100 minimum increase, all 
lower-bracket State salaries. 

We are surveving all State departments in an eflfort to reduce personnel to offset 
these salary increases, and I am confident that some success will be had in this 
effort. However, understaffed and underbudgeted State institutions will require 
supplemental appropriations in the near future, and total State operating costs 
are bound to rise if we are to meet our responsibilities fully. 

In the State-Federal fields of categorical assistance, rising costs of living are 
creating a real injustice to 30,000 children outside of the Detroit area, on the 
aid-to-dependent-children rolls. Federal grants do not match the State grants, 
and should be adjusted immediately to follow the old-age assistance pattern of 
equal contributions by State and Federal agencies. 

The plight of a mother trying to provide for her child on an inadequate allow- 
ance, at a time when the child needs the moral and physical strength of good food 
and decent clothing and housing, is to me the most pitiful plight that can exist in 
our social-security program. In Michigan, the deficiency is entirely a Federal 
one. Adjustments should be made at once. 

The old-age assistance program now presents a State financial problem. Michi- 
gan this year has wiped out almost its entire old-age waiting list of 25,000 persons. 
Our efforts to stabilize the program at around 100,000 persons now are endangered 
by rising costs of housing and' food. If present trends continue, we will have to 
allocate an additional $1,000,000 a year to this program or revert to the waiting- 
list plan. Food costs have risen 14 percent and our program now does not provide 
a minimum adequate food budget for old-age pensioners, 

EFFECTS OF DEFENSE PROGRAM ON ECONOMIC AND SOCIAL STRUCTURE OF MICHIGAN 

By the end of November, it is estimated that at least 33,000 automobile workers 
will be unemployed in Detroit because of the automobile-production quotas. 
By January 1, it is estimated that this total will reach 45,000. 

These estimates are based on present indications. The picture was darker 2 
months ago, but has been improved by additional defense contracts and by speed- 
up of the rate of induction of workers into defense plants. 

We hope the hardships now looming can be further alleviated. The problem is 
being tackled intelligently today by Federal and State agencies and by employers 
and labor unions. A 32-hour week woidd prevent any unemployment until 
December, and would cut the unemplovment total to 16,000. 

The city of Flint faces a greater relative defense unemployment than any other 
in America, unless given additional defense contracts quickly. By November 
Fhnt faces an employment decline of 8,100 on a 40-hour week, or no decline on a 

60396— 41— pt 18 2 



7074 DETROIT HEARINGS 

32-hour week. By January the totals will be 16,800 or II, 700. Entirely an auto- 
motive town, Flint has 45,000 industrial workers and only 2,000 on defense 
assignments. 

Other IMichigaii industrial centers can transfer to defense jobs with leas diffi- 
culty, but still need added contracts to absorb enough employees. 

CONTRACTS AND SUBCONTRACTS 

The mo.st threatening social and economic problem in Michigan today is the 
fate of the 2,000 small- and medium-sized factories scattered throughout every 
citv in the State. 

Subcontracting was widely practiced by the automobile industry during all the 
years of its civilian growth. Michigan's manufacturing empire cannot be looked 
upon as confined to one area of the State. The variety and intensity of industrial 
activity made possil^le the existence and self-sufficiency of hundreds of couununi- 
ties, scattered throughout the Lower and Upper Peninsula. If they were not di- 
rectly allied with larger manufacturing plants through subcontracts, at lea,st 
they existed through the trade, the accessories, the markets created by automobile 
manufacture. 

Today production quotas and defense priorities over essential materials threaten, 
within 3 months, to wipe out many small businessmen and industrialists of 
Michigan and of the Nation. 

Michigan ranks fifth among the States in total prime defense contracts, and 
first in the Nation in total ordnance contracts and subcontracts. Prime contracts 
total $1,500,000,000, and subcontracts bring the total to well over $4,000,000,000. 
Much of this work extends over a 2-year period. The total is exceeded only by 
coastal shipbuilding States. . 

And yet Michigan could produce 50 percent more for defense if the energies of 
our small industries were tapped. And unless the priorities starvation now facing 
our small industries in rural Michigan is relieved, Michigan faces a welfare and 
economic problem of serious consequences. 

DEPRESSIONS START IN SMALL TOWNS 

The problem is national and results from overlooking a fundamental economic 
truth— no American community can exist without a trading area equal vn popula- 
tion to the community itself. 'The big city needs small towns. The small town 
needs a local rural trade. . . , * • i i t 

Depressions start in small towns, because small towns exist on the trickle of 
cash from one main industry. When that trickle of cash stops, the town has 
nothing to fall back on. ... 

The town's life-giving income stops when, for some reason, the main business 
loses its customarv business orders from the larger cities. In the present instance, 
defense priorities," ignoring small towns, stops the flow of orders from the city. 

As a result, the residents of the small community cannot continue to buy 
products from the larger manufacturing areas. Its markets declining, the larger 
producing area must curtail other manufacturing, which again strikes a blow at 
the small town. . , , , , . 

Although small towns have not the industrial resourcefulness of larger com- 
munities and thus create depressions when business stops, the small-town resident 
personally is more resourceful than the city worker. Lower costs of living and 
ability to turn to "depression farm.ing" keeps the small-town resident going 
without the tremendous and immediate need for welfare assistance that character- 
izes our city populations. , ,. .. j t i *i, ^^ 

I am not an alarmist. I know the problem is complicated. I know that 
national defense deserves the right-of-way. I know that the larger plants are 
l)etter eciuipped To speed defense production, and that subcontracting of defense 
work is not possible or practical in everv instance. I know that the problem is 
receiving sym]iathetic and intelligent attention today from both governmental 
and private sources. I think the threat to our entire national economy will be 

licked. . .,. 5 • T J. • 1 

But I know also that unless civilian lal)or priorities and civilian materials 
priorities are not granted auicklv to those areas which cannot participate in na- 
tional-defense business, Michigan and the Nation will see severe economic dis- 
location within 3 months. . , . , i i j i,- -^ ♦ 
If we are to pav the new Federal taxes, and avoid widespread hardships amidst 
boom, our defense economv iT>iist be adiustcd quickly to .save those who either 
cannot, <'T as vet have not, participated in defense work. 



NATIONAL, DEFENSE MIGRATION 7075 

Michigan farmers have beeu assigned added responsibilities in the expanding 
food program. They mnst be protected by priorities for needed farm machinery 
to offset tlie already serious emigration of farm labor to defense areas. They still 
have a must insecure footing on the land, and deserve reasonable profits for their 
produce. They are diversifying their crops and cooperating fully with production 
quotas. Despite labor shortages which may l)ecome critical, they appear to be 
reaching an income position where thej- can pay their debts, gain economic 
security, and end any furtiier need for farm-subsidy payments. 

Other witnesses will discuss in detail the localized community jiroblems of 
defense migration, relative to housing, sanitation, education, and transportation. 
I call particular attention to the sound program of the >State highway department 
for building expresswajs to Ypsilanti and other defense centers, which will permit 
the cheaper and more efficient stress of commuting to work from present popula- 
tion centers, rather than creating new communities during the emergency period. 

MEASURES TO PREVENT DISLOCATION OF LABOR 

The State and Federal Govertanent face three major tasks in developing policies 
and taking positive action during the next feM^ months to ease the damaging effects 
of the industrial transition from civilian to defense production. 

Michigan will bear the unemployment hardship with pride, knowing it is neces- 
sary to the defense of the Nation. We f^e the certainty that many other civilian 
industries will have production curtailed because of inability to olJtain materials. 

Our job now is to ease as much as possible the shock of transition, by these steps: 

1. Protect the economic security of workers who are temporarily displaced, 
and furnish them with some source of income until defense jobs open. 

2. By wholehearted cooperation of Government, labor, and industry proceed 
energetically with a variety of measures to speed up expansion of defense jobs. 

3. Discourage and prevent further migration of workers into Michigan indus- 
trial centers until, by up-grading and training, all Michigan workers are utilized. 
Further migration will only multiply our present problems. 

UNEMPLOYMENT COMPENSATION 

Most of our displaced workers will be eligible for unemployment compensation 
for 18 weeks at $16 a week. I sought vainly this year to obtain a higher grant 
from the legislature, since this $16 is less than half the usual wage of industrial 
workers. 

The 2-weok waiting period, and the $16 rate, may not be sufficient to hold 
workers in the cities where they will be needed later. The 32-hour week pro- 
vides Mider, larger income, but cannot always be ajjplied. 

Under the present compensation law, there is another serious limitation on 
the adequacy of benefits. Unemployed workers cannot receive benefits in any 
year amounting to more than 25 percent of their earnuigs in the preceding base 
year (for low-pf,id workers, 30 percent). Workers wlio have had steady em- 
ployment in the base year may draw a maximum of 18 weeks of benefits, but 
those who have had irregular employment — and are therefore in most need of 
]>rotection— qualify for a shorter duration which may be as little as 8 or 10 weeks. 

Workers with high sem'ority will probably be r.bsorbcd quite rapidly in defense 
production, under agreements recently reached between labor ard inanagement 
in the automobile industry. Workers with low seniority, who are most likely 
to qualify for only a few weeks of benefits, are the ones who are most likely to 
need a longer period. 

When we realize that nearly 70 i)ercent of the workers who drew benefits in 
1938-39 had a period of unemployment which was longer than tlieir maximum 
benefit period, it seems clear that we should consider the possibility of extending 
the duration of benefits ard increasing the size of the w>ekly payment, as one 
niethod of preventing our labor force from scattering to othei- ".States in the 
interval before they can be put back to work here. 

IN( REASED BENEFITS FOB DEFENSE TBAINEEB 

There is one interesting feature of the present unemplovment compensation 
law which deserves further study. This is the provision which permits an increase 
in the duration of benefits for workers who are taking vocational training to fit 
them for new jobs. However, the present law permits only a)i increase of a few- 
weeks, (never beyond a total of 16 weeks) and makes no pn. vision for increasing 
the weekly amount i)aid to men who are undergoing training. Thus, the present 



7076 



DETROIT HEARINGS 



provisions provide little incentive to keep displaced workers from moving to 
other areas. 

We might consider the possibility of expanding this general principle to meet 
our present proV:)lems. Manv of the displaced workers will require special training 
to fit them for defense jobs. We might use the unemployment compensation 
system as a wav of supplementing their income while they receive this training. 
This might mean that it would be desirable to extend the maximum benefit period 
for men and women who are being trained for defense jobs to as much as 20 or 26 
weeks. Also, we might increase the weekly benefit rate for trainees to some more 
adequate amount, such as a flat $20 per week, instead of the lower rate which they 

otherwise receive. , , . , x- tTri. xi_ xu- 

Such a program would, of course, require new legislation. Whether this 
particular step should be taken will depend on our success in developing other 
possible measures for bridging the gap between civilian and defense jobs. 

SUGGESTIONS FOR ENLARGING EMPLOYMENT 

Unemplovment compensation, even if it is greatly liberalized, provides at best 
a partial aiiswer to the problems of the next few months. Relief and Work 
Projects Administration efforts, though these may help to sui)plement compen- 
sation, will i^rovide little incentive to prevent undesirable migration from our 
industrial cities. The basic solution of the problem must be found in creating 
additional jobs as soon as possible, and in an equitable distribution of the work 
that is available. 

Here are suggestions: , t, , .. 

1. Through the Defense Contract Service of the Office of Production Manage- 
ment, special arrangements are being made to allot further defense contracts to 
communities in which serious unemployment is expected. The immediate need 
is not for long-range projects, which cannot employ large numbers of workers until 
new construction is completed, but for contracts involving production which can 
be handled with existing equipment, or with only minor retooling. 

2. The expansion of defense employment can be speeded up to some extent by 
accelerating the production of machines and machine tools which are needed to 
equip new defense factories. The tooling-up process might be accelerated by 
pooling of existing resources for tool and die manufacture. At present, some of 
these facilities are unused, at the same time that the lack of necessary equipment 
prevents expansion of defense employment. 

3 Arrangements which are alreadv being worked out between management and 
organized labor will give assurance that workers with seniority in nondefense em- 
ployment will receive preference in new defense jobs as these become available. 
The automobile industrv has already accepted this principle for its own plants. 
Possibly some further steps toward the adoption of community-wide seniority 
might be helpful in preventing migration. .. • -.4. 

4 Where it is impossible to m.ake jobs available on actual production, it might 
be possible to increase the training programs of plants which will eventually need 
men on new types of work (such as aircraft production) with workers receiving 
pav while they are being trained. Some companies have already developed plans 
of "this type, thus providing income for workers who will eventually be needed in 

5 At present nsany defense plants are operating only for a 5-day week. If we 
can' work out arrangements for operating these plants 7 days a week there is a 
possible gain of about one-third in the number of defense jobs that can be pro- 
vided \ similar problem exists in some plants which now ojjerate with only 
two shifts and might be able to handle a third shift, with many additional workers 

emploved. , , ^ , , ,^ i- • i- 

6 the growth of defense emplovment can be accelerated bv extending existing 
contracts, and advancing delivery dates for defense products, in such a way as 
to encourage industrv to accelerate the tempo of production. , t. , , 

7 Although the facilities of many plants have been surveyed by the l^ederal 
Government to determine their availability for defense production, there is prob- 
ably a great deal that might bo done in the way of thorough engineering surveys 
which will permit unused productive equipment to be brought into action sooner. 
Such surveys— in which the State as well as Federal agencies might participate— 
may reveaf situations in which special arrangements for making equipment avail- 
able to nondefense plants would permit them to undertake defense production. 



NATIONAL DEFENSE MIGRATION 7077 

POST-WAR PROBLEMS 

Just because ue are united today for defense of our way of life, and just be- 
cause the unemployment and insecurity problems are in the background today 
because of defense spending, we cannot say we have solved the unemployment 
problem, or that we are satisfied with our way of life. 

It is time to drop the old arguments over who is to blame for unemployment 
and deficits and social insecurity, and unite behind a positive program to return 
the Nation to a self-sufficient economy that will recognize all social obligations, 
all lights of private enterprise, and all rights of labor. 

Michigan has joined the national program calUng for 6-ycar reserve of post- 
war projects and will stress such positive programs as highways, city planning, 
health service, nutrition and education. 

Following the sound lead of the National Resources Planning Board, our State 
planning commission is drafting a State program to coordinate all elements of our 
economy — agriculture, labor, industry, finance — in a voluntary undertaking which 
recognizes the mutual interests of all areas in steady employment and steady 
income. 

Today the Nation's crying need is for price control to prevent inflation. After 
the war, united cooperation can bring fair prices, fair wages and fair income for all 
groups and all sections. Government must remain the servant of the whole 
economy, and a complete program must be worked out which will merit the ap- 
proval of all elements of that economy, without any resort to socialism or 
totalitarianism. 

Home ownership, a steady job, insurance against the hazards of disability and 
old age — these are the goals of any sound society. A migratory people are not 
interested in economical government. It is important today to plan for the post- 
war period, not alone because we must be ready for the problems of the period, 
but because our people will unite more heartily behind the defense of a nation which 
is moving toward a definite goal, along a clear-cut course. 

The most encouraging aspect of these troubled times is the good sense of our 
people in surmounting the handicaps facing every step of the defense program, 
and their faith in the future of America. In Michigan, the greatest possible 
e.xpression of that faith is under way today. Our people are buying rural land to 
a greater extent than they have in decades. They have grown wiser in the depres- 
sion years, and are buying personal security for the future. 



TESTIMONY OF HON. MURRAY D. VAN WAGONER— Resumed 

The Chairman. We have prepared some questions which I think 
will bring out the points that we seek to establish by your testimony. 

Now, Governor, what is your estimate of the over-all reduction 
in ernployment in Michigan that will result from the announced 
curtailment of automobile production and from such shutdowns as 
may occur due to shortage of essential materials? 

Governor Van Wagoner. We estimate that the curtailment of 24 
percent in production which is taking place at the present time has 
caused an unemployment of about 25,000. 

ANTICIPATES 100,000 WILL BE UNEMPLOYED 

The new curtailment which is expected to go into effect — I believe 
it is in December — would at least double this number and perhaps 
force it as high as 100,000, because there are a lot of related indus- 
tries, and once the automobile production is cut down, people in these 
other industries are also forced out of employment. 

The Chairman. Governor, what are the prospects for reemploy- 
ment of these workers in the defense activities now undertaken in 
the city of Detroit? 

Governor Van Wagoner. The prospects of reemploying these 
people are not so good right at the moment. Wliat I mean by that 
IS, until the people who have the prime contracts in our State of 



7078 DETROIT HEAKINGS 

Michigan have enough prime contracts so that they are required to 
farm out more of this work, reemployment in defense mdustries will 
not offset the loss of jobs in motor-car manufacturing. 

The Chairman. In dollars and cents, what do the prime contracts 
amount to, Governor? 

AMOUNT OF PRIME DEFENSE CONTRACTS 

Governor Van Wagoner. About a billion and a half dollars, but 
the work that is being done on defense contracts is moving, in my 
opinion, too slowly to absorb the people who are gouig to be laid off 
by this changeover. 

Personally, I am sure that in the end — say a year from now— a 
majority of these people will bo reemployed in defense work and, of 
course, that is what we are really after. W(^ believe this can be done, 
and the one thmg we are very much concerned about is that the de- 
fense work is not moving fast enough to balance the serious nondefense 
unemployment at the present time. 

It seems to me if more prime contracts could be let, and if the com- 
pletion date could be speeded up, two thhigs would be accomplished. 
In the first place I thuik there would be an incentive on the part of 
the prime contractors to subcontract this work, as thc}^ do in the 
normal automobile busmess; and, second, the morale of the workmen 
themselves would be maintained. I think this is veiy important hi 
this critical period. 

The Chairman. Governor, you have some of your aides here with 
you, do you not? 

Governor Van Wagoner. Yes, sir; I have. I have more than that. 
I have quite a battery here. 

The Chairman. I would like to get the names of these gentlemen 
for the record. 

Governor Van Wagoner (indicating). Mr. C. W. Lucas, press 
secretary; Mr, V. B. Steinbaugh, who is our liaison man working with 
the O. P. M. in Washington at the request of the O. P. M.; Mr. 
Wendell Lund is head of the unemployment compensation commission 
in the State; Mr. Louis M. Nims is managing director of the State tax 
administration in the State of Michigan, and Mr. Leo J. Nowicki is 
the budget director of the State of Michigan. 

The Chairman. Governor Van Wagoner, what are the State 
agencies, such as unemployment compensation, W. P. A., State and 
county reliefs, which are equipped to deal with the hardships caused 
by unemployment in Michigan? 

UNEMPLOYMENT COMPENSATION 

Governor Van Wagoner. Well, the uncmploj^ment compensation 
commission is organized and capable of dealing with this problem, 
insofar as it is able to do so by law. However, we have in the State 
of Michigan a limit of 18 weeks for aid to the unemployed, and that 
only pays $16 per week. 

In my inaugural message in January I advocated increasing the 
period to 20 weeks, and it was changed to 18 from 16 weeks. I 
also advocated raising the amount per week from $16 to $20^ but that 
was not done. 



NATIONAL DEFENSE MIGRATION 7079 

Insofar as it is able, with the limitations placed upon it, the unem- 
ployment compensation commission can do this job. However, in 
view of the fact that the period of payments is so short, and the 
fact that the amount of money is so small, it seems to me that that 
agency's activity will not be sufficient to handle the emergency relief 
program required if, as estimated, it is going to take us at least a year 
to get these people employed on defense work. 

W. p. A. CURTAILMENTS 

As far as the W. P. A. is concerned, as you know there was a cur- 
taihnent of some 40 or 50 percent in the rolls, which has caused real 
hardship among certain people who were not even employed in the 
automobile business. It is hard for those people to exist at this 
time. 

I do not beheve W. P. A. can be of any service in this particular 
function unless the money that was taken from it is restored; and 
even that amount would be insufficient to solve this problem. 

You mention another agency. State and county relief. 

RELIEF PAYMENTS LOWEST SINCE DEPRESSION 

We now have the lowest relief since the depression. However, that 
relief is paid jointly by the State and by the county. It is figured out 
on a very close basis. If we are going to have more unemployment, 
it will mean calling the legislature back into session and appropriating 
further sums for this purpose. 

The State of Michigan last January had a deficit of $28,000,000. 
That has been reduced now to about $12,000,000. But if we are to 
call back the legislature, to appropriate more money, mstead of wiping 
out that deficit we are gomg back in the other direction, and accumulat- 
ing further deficits. 

The Chairman. What will be the effect. Governor, of the cut in 
automobile production on State revenues? 

Governor Van Wagoner. In Michigan our State reHef receives 
about two-thirds of its funds from the sales tax. 

SALES TAX 

The Chairman. How long have you had the sales tax? 

Governor Van Wagoner. Since 1933. And in Michigan, perhaps 
more than in any other State, we are dependent for the operation of 
our State government on that tax. Any decrease in car production 
or in employment in any way naturally will decrease that sales tax, 
and almost in the proportion that that employment is done away with. 
State revenues will be cut down. But the effect on revenues will be 
magnified if we have a curtailment in the things that the workers may 
want to buy, such as automobiles, refrigerators, and stable goods. 

Mr. OsMERS. Governor, does your sales tax apply to all merchandise 
made m the State or just that sold within the State? 

Governor Van Wagoner. It applies to all merchandise that is sold 
in the State. 

Mr. OsMERs. Wholesale and retail? 

Governor Van Wagoner. It is a sales tax on everything that is 
sold in the State of Michi2:an. 



7080 DETROIT HEARINGS 

Mr. OsMERs. Am I correct in inferring that if an automobile is 
sold by a manufacturer to a dealer and by a dealer to the individual, 
there are two sales taxes paid on it? 

Governor Van Wagoner. No, I don't think there are two. Maybe 
Mr. Ninis would like to answer that. He is the head of the sales 
tax administration. 

TESTIMONY OF LOUIS M. NIMS, MANAGING DIRECTOR, STATE 
TAX ADMINISTRATION, LANSING, MICH. 

Mr. NiMs. That would be a resale, which is exempted under our 
law. Ours is a direct, final sales tax. It is the last tax in a series of 
transactions. 

Mr. OsMERS. How does an automobile come under that law if it is 
sold for resale in another State? 

Mr. NiMs. Quite a high percentage of them are sold in Michigan 
to Michigan people, and if production is dropped, Michigan naturally 
would take a loss. 

Mr. OsMERs. You would only lose the sales tax on automobiles that 
were sold and used within the State of Michigan? 

Mr. NiMS. That is right. That is the direct sales tax; but of 
course any curtailment that you make in the production of automo- 
biles means that people employed in that production are not going to 
have money to spend. 

Mr. OsMERS. It lowers the purchasing power. 

Mr. NiMS. That is correct. 

TESTIMONY OF GOV. MURRAY D. VAN WAGONER— Resumed 

Mr. Arnold. Is that a 3 percent sales tax? 
Governor Van Wagoner. Yes, sir. 

Mr. OsMERs. How much money does that bring in, in the course of 
a year, at the present time? 

Mr. NiMS. Around $70,000,000. 

TOURIST TRADE REVENUES 

The Chairman. Governor Van Wagoner, I was very much inter- 
ested, and more or less startled, to learn the amount that the State of 
Michigan receives from your tourist trade. 

Governor Van Wagoner. $400,000,000. 

The Chairman. The highest in the Nation. 

Governor Van W^agoner. Yes; I believe that is correct, according 
to the figures of the chamber of commerce. 

The Chairman. Now, what effect do you think automobile curtail- 
ment and gasoline shortage will have on that trade? 

Governor Van Wagoner. Any curtailment in the sale of cars will 
naturally curtail our tourist and resort business, and the same is true 
of the restrictions on the use of gasoline. 

It is not the fellow who trades his car in every year and gets a new 
car. He is not the man we are talking about. But if the man at 
the top cannot get his new car, then he in turn can't trade his car in 
to take care of the man in the lower status, and from there on down 
the same thing is true, to the men who have the last bracket of cars. 



NATIONAL DEFENSE MIGRATION 7081 

The car that is forced off the road is the one I am talking about — the 
car that will no longer run. Its owner is the man who is going to be 
out of a car, and who is also gomg to be seriously affected by a reduc- 
tion of gasoline, if that is reflected in a rise in price. 

The Chairman. Governor, what attracts tourists to Michigan is 
the huntmg and fishing and other sports, I presume. 

Governor Van Wagoner. It is hunting and fishing, but the 
Almighty God was very gracious to the State of Michigan when He 
created this universe. As you know, we have more shore line than 
any other State in the Union. We have an area that is covered with 
trees, pretty nearly anywhere you want to go. Our State is covered 
with trees and vegetation, and that in turn protects our fishing and 
our hunting. The weather is very favorable in this part of the 
country, especially in the summertime, and it has become a regular 
haven for people from States with less pleasant climates. They 
come here once and go back and then come back again and again. 

STATE DEVELOPMENTS 

We have tried to develop our highway system so that people can 
see what we have to offer here in the State of Michigan. We are 
building shore-line highways, roadside parks with picnic tables, and 
we are making some places that are very beautiful in the State of 
Michigan accessible to the tourists. I believe they appreciate that, 
and in turn they will tell then friends, and more people will come 
back year after year. 

The Chairman. Governor, if I were not sure that you are the 
Governor of Michigan, I would say you are from California. That is 
California talk. 

Governor Van Wagoner. Well, we don't guarantee the weather 
here. 

The Chairman. We can guarantee it out there — except, of course, 
when it is "unusual." 

industrial OUT-MIGRATION 

The Chairman. Governor, do you anticipate any large-scale out- 
migration of workers as a result of industrial shut-downs in this area? 

Governor Van Wagoner. The thing that I am very much concerned 
about there is the fact that in our mass-production automobile plants 
we have built up a group of skilled mechanics — tool and die makers 
and people of that category — who may have 10 or 15 men of ordinary 
mechanical skill working under them. If we have a shut-down, and 
if we lose these key men to other parts of the country where they 
could secure work, then when we get our material in, when we get 
our defense orders and we are all ready to go, we may find ourselves 
in a condition of being unable to make the machinery to put out 
these defense articles. 

Now, that wasn't true in the depression, because then you had a 
depression all over the country, and things were just as good here as 
they were anywhere else. But if we were to lose these keymen now, 
I feel that we would lose part of the essential skill of our great produc- 
tion center here in Michigan, and I think it is very vital that some 



7082 DETROIT HEARINGS 

effort be made to see to it that we do not lose these men or the work- 
ing orc^anization which has been set up, with these keymen at the top 
and the 10 or 12 workers under each one's supervision. 

Mr. OsMERS. Have you lost many so far, Governor? 

Governor Van Wagoner. I do not believe we have, up until now, 
because the plants themselves are not going to release these men 
until they absolutely have to. Even if it costs them more money, I 
know they will keep them as long as they can. It is to their interest 
to keep them. But, of course, if you shut this whole car industry off 
100 percent, as has been talked in some places, a point would be reached 
where these men would be forced to go to other places to secure em- 
ployment, and you couldn't blame them if they did. 

Mr. OsMERS. I know they are needed in other parts of the country. 

Governor Van Wagoner. That is just the point. They need 
those people in other parts of the country, and if wo should lose them 
here, then when the day comes when we have all of the material on 
our front doorstep and are ready to say, "Go to work," we would sud- 
denly find out we didn't have the manpower and skills to do so. 

It'seems to me that one thing we ought to consider before we go into 
too much reduction of output, is a reduction of the hours of work in 
the automobile industry, say from 40 to 32 hours a week, if necessary 
in this interim and in the shift-over period, so as to hold this organiza- 
tion together. Then when the time does arrive, we are going to have 
this unit force that is used in mass production, and is trained in turn- 
ing things out in a hurry. It will be all set and steamed up to do this 
job which the country is looking to us to do. 

Mr. OsMERS. I was wondering if you had been investigating the 
possibility of spreading the work. 

Governor Van Wagoner. I think that would be much better. 

Mr. OsMERS. During this time. 

Governor Van Wagoner. I think it would be much better than 
laying off a great number of men, or looking to the Unemployment 
Compensation, or to W.P.A., or to some subsidy, because when you do 
that, after all you do lose the morale of these men, which is important 
in these times. 

Mr. OsMERS. Then the follow-up of that would be a general rest- 
lessness on the part of 3^0 ur industrial worker population, and they 
would start to move all over the country, wouldn't they? 

Governor Van Wagoner. Yes, sir; and when you want them, they 
are not going to be here. 

Mr. Arnold. Let me ask the Governor at this point, do you think 
it is because your prime contractors haven't enough contracts that 
they don't subcontract, or is it an unwillingness on their part to sub- 
contract? 

larger volume of prime contracts needed 

Governor Van Wagoner. I think the manufacturers would sub- 
contract if they had enough prime contracts so they knew they could 
take care of their own men. But to date they haven't even enough to 
reemploy their own men in changing over to defense. Therefore, 
there is no incentive on their part to subcontract this work. 

Mr. Arnold. In other words, there is not enough push. You have 
to get the contracts coming in rapidly in order to nuike them sub- 
contract all over Michigan and in parts of northern Ohio and the sur- 
rounding territory? 



NATIONAL DEFENSE MIGRATION 7083 

Governor Van Wagoner. Yes. Then there would be a real in- 
centive to subcontract the work, to get the thing out on time. 

Another thing we haven't mentioned, which is very serious, is the 
small town that has maybe just 1 plant in it and employs maybe 100 
or 200 men. 

Mr. OsMERS. What would the peacetime product of such a plant 
be? 

Governor Van Wagoner. It might be nluminum goods, or a casting 
or something like that for a bigger automobile plant. Now, if this 
particular plant doesn't get at least one subcontract, you can see that 
in that town there will be a very serious problem. 

IMPORTANCE OP SUBCONTRACTING DIVISION 

I was very happy to see the office of O. P. M. set up a separate divi- 
sion for subcontracting for just this sort of thing. In other words, I 
believe Washington recognizes this problem. Furthermore, I was 
very happy to see that they put a man like Mr. Odium at the head of 
it. In my opinion, he is a very capable man. 

Mr. OsMERS. Have you seen any evidence in the State of Michigan 
that this subcontractmg division of the O. P. M. is workmg? I feel 
as you do that it was a fine thing to see it set up, and that the director 
of it is a capable man; but have you seen any evidence that it is 
working? 

Governor Van Wagoner. I am sure that it is working, but it isn't 
working well enough or fast enough to put every plant that we have 
in the State of Michigan to work in getting out this defense stuff the 
way the Nation expects us to get it out. 

Mr. OsMERS. Governor, is there anything that you, as a member 
of State government, can suggest to ourselves, as members of the 
Federal Government, that would straighten out or help the organiza- 
tion of defense in Washington with respect to all of these problems? 

EMPLOYMENT SURVEYS 

Governor Van Wagoner. One of the things they are doing now, 
which I think is good, is following the unemployment records. They 
know, for instance, how many people in a town are working on auto- 
mobile production, and they know if that is cut off, there is going to 
be an unemployment problem there. 

Mr. Osmers. Did the Federal Government make that survey? 

Governor Van Wagoner. I guess they are working jointly with 
the Unemployment Compensation Commissions, 

Air. Lund. That is correct. Governor. 

Governor Van Wagoner. In other words, they are working closely 
to foresee reactions, and then deciding whether or not to place a 
contract in a particular field. Some contracts, however, must be 
awarded to the low bidder. In such a case you can't guarantee that 
this man in the town with the one plant is going to be the low bidder 
on that job. It might be necessary, and even advisable, that this 
man be given at least a trial order. 

Mr. Osmers. On a cost-plus plan, or something like that? 

Governor Van Wagoner. Yes, sir; a cost-plus plan. 



7084 DETROIT HEARINGS 

Mr. OsMERS. Has the State of Michigan had any difficulty in its 
dealings with the Federal Government in this emergency, in the 
matter of getting answers to questions, in getting accurate informa- 
tion, and in solving some of these problems, in many cases not only 
affecting States but manufacturers and others? People have com- 
plained bitterly about the confusion and the apparent lack of organi- 
zation in our Washington defense set-up. 

LIAISON BETWEEN STATE AND OFFICE OF PRODUCTION MANAGEMENT 

Governor Van Wagoner. Of course there is a lot of work for 
everybody to do, and there are a lot of things that can't click just over 
night; but as far as I am concerned, all of the letters I have addressed 
to the O. P. M. were properly referred to the individual whom it con- 
cerned. Only one was unanswered, and even in that instance I got a 
telephone call, and they said they would prefer to have me come down 
there and get the answer direct, which after all is all I could ask for. 
As a result of that Mr. Steinbaugh was made liaison officer between 
the Federal Government and the State, at the request of the O. P. M., 
and since he has been down there, I am sure they know what our 
problem is, and we in turn are finding out some of their problems. 

Mr. OsMERS. We are not having much difficulty in finding out 
what the problems are; we are having difficulty in solving them. I 
was wondering whether any of these problems are being solved. 
I realize that the act of setting up a board or bureau or appointing a 
commissioner or something like that is a recognition that the problem 
exists, but the problem isn't solved unless and until the commission 
or board or bureau does something. 

Governor Van Wagoner. That is correct. Well, as I say, this new 
department on subcontracting has been formed, and I think you have 
a very capable man at the head of it. I am very optimistic about the 
prospect of his getting something done about this problem. He has 
quite a reputation for benig able to get things done, and if he takes 
hold of this the same way he has other things, I am sure it will be done. 

Mr. OsMERS. With all due deference to Mr. Odium, I hope they 
get it done before the war is over. 

Governor Van Wagoner. I am very much encouraged. We 
haven't even seen results yet, because it is too early, but at least I 
know a place where I can refer the letters that come in day after day-^ 
where this small plant is going to be out of material, and that one is 
going to have so many people unemployed. 

POOLING FOR defense CONTRACTS 

Mr. Arnold. I realize Michigan is in a somewhat different position 
from that of Illinois. In my State we have certain cities, as for 
instance the city of Decatur, 111., a community of, I suppose 70,000 
people, which does not have a great enough diversification of industry 
to take a prime defense contract by itself. But there are other 
manufacturers, and together they can take contracts. 

Governor Van Wagoner. Pool their interests. 

Mr. Arnold. Exactly. One firm takes the contract, with the 
imderstanding they will all come in. 

Quincy, 111., is a town almost as large, and it is being surveyed for 
the same purpose. Do you have that situation in Michigan? 



NATIONAL DEFENSE MIGRATION 7085 

Governor Van Wagoner. I think we have some towns hke that. 
Perhaps St. Joseph, Mich., would be hke that. There they have a lot 
of small manufacturing plants. One plant wouldn't be large enough 
to handle a prime contract, but together they might be able to do so. 

Mr. Arnold. Is any effort being made to utilize those plants? 

Governor Van Wagoner. There hasn't been much done in regard 
to that here in Michigan. We have had complaints from St. Joe. 
We have been asked, " Wliat is this plant going to do when its material 
is shut off?" 

Mr. Arnold. The reason this committee is interested in that is 
that such pooling of interests will prevent interstate migration of 
workers. 

IN-TRAINING SUBSISTENCE WAGES 

Governor Van Wagoner. I think it has possibilities. 

The Chairman. Governor, what is your reaction to the proposal 
that displaced workers be paid a subsistence wage while in training for 
future defense employment? 

Governor Van Wagoner. I believe that w^ould be all right as a 
last resort. Of course, we are more concerned about speedmg up this 
program, moving the completion date ahead and putting our whole 
people on a speed-up basis, to the point where they can get these 
ordei-s out faster. We are also very much concerned about anything 
that you do along the way of a subsistence plan that is going to 
destroy the morale of the workmen themselves. 

But as a last resort, 1 thmk that would be much better than just 
leavmg this man on relief or trying to handle his situation from an 
unemployment problem standpoint. Wliat I would rather see, of 
course, is more contracts let, so that a solution will develop in its 
normal way. 

The Chairman. In San Diego, Governor, the committee's attention 
was called to what is known as a dismissal fee.^ Under this plan, 
when a company secures a Government contract, it would add an 
amount in, don't you see — say 2 percent, or 5 percent — looking to 
the time when the plant wOl probably be shut down. This money 
would then provide a cushion for the discharged workers after the 
whole thing is over, and the plant has been shut down. Has that ever 
been called to your attention? 

Governor Van Wagoner. No; it has not. 

The Chairman. After making several trips throughout the country 
last year, the committee has come to the conclusion that there were 
too many American citizens on the road. Stateless and homeless and 
voteless. We realize at the same time that the States can carry only 
a limited financial load, and that they cannot take care of all of these 
"nonresidents." There is no question about that. There comes a 
saturation point. We therefore recommended to Congress an addi- 
tional appropriation whereby the Federal Government would take care 
of these nonsettled persons. Have you given any thought to that? 

federal responsibility for nonsettled people 

Govenior Van Wagoner. We have given that a good deal ot 
thought, not just froin the angle of Federal relief; we are continually 
having people come in here during good times, and then they are 

' See San Diego hearings, p. 4959. 



7086 DETROIT HEAKIKGS 

located here, as you migrht aay, as a State responsibility afterwards. 
As far as the State of Alichigan is concerned, we do not want any 
people to come into our State — into this picture at all — until the people 
we have here now are fully employed on this defense work. 

Now, if for any reason whatsoever the Federal Government finds 
it necessary to bring workers uito this State to do a certain job, then 
I most certainl}^ thmk that after this effort is over, the Federal 
Government should make some provision for their welfare, and not 
let them become State charges. 

The Chairm.\n. I think you are correct, Governor. I think the 
State of ^Michigan's effoit sliould be to hire local people. 

Governor Van "Wagoner. That is right. 

The Chairman, And that is a question hi which our committee is 
deeply interested. We have great numbers of people now who have 
left their home States and gone to these defense centers. Well, it 
doesn't take much of an imagination to realize what a whirlpool can 
be created by a situation like this, after the war is over. So the fewer 
who leave their home States, the better for the Nation as a whole. 

Governor Van Wagoner. That is right, absolutely. 

The Chairman. Governor, have you any idea what part the 
W. P. A. should play in alleviating effects of the curtailment in 
automobile production? 

Governor Van Wagoner. The W. P. A. can't play any important 
part until the amount that has been cut off is restored, and until 
more money is appropriated, above that, to take care of the additional 
workers wllo will be laid oft' due to this curtailment. However, I feel 
the same way about that as I do these other problems. What I think 
we ought to do is concentrate on output, and on the goal of keeping 
our people all employed and up to a pitch where they can do the job 
that we are called upon to do. 

The Chairman. Governor, we have had before our committee 
governors, mayors, and high departmental officials, State and Federal; 
and in addition, over 200 migrants. We have been all over the United 
States, and everjnvhere we have found unanimous agreement that it is 
a Federal problem, the problem of taking care of these nonsettled 
persons coming in from the other States. 

Now, to provide us with infoi-mation hi the record, are you willing 
to go this far: If unemployment increases here in Michigan as a result 
of this shift from defense to nondefense industries, would you say 
that there should be an increased appropriation for the W. P. A.? 

COPPER PRODrCTION SUBSIDIES 

Governor Van Wagoner. Our prune purpose is to have the people 
employed. If they are employed in defense, that is fine, and the 
sooner they get from car production hi to defense production the 
better. We have certain numbers of people on W. P. A. You want 
to increase that, but after all, that is Avhat we will call a subsidy of 
some sort from the Federal Government. If we are going to have a 
subsidy of some sort from the Federal Gov(irimient, why not have a 
subsidy as we did in the copper range, where we asked for an incre- 
ment of 8 cents for the copper produced in the Upper Peninsula so 
they could put those people to work doing the work that they are 
used to doing, and at the same time increasing the supply of copper 



natioj^m. defense migration 7087 

which can be used for the defense effort, which is one of the basic 
materials that wo are short of at the present time. 

The Chairman. What is the status of the copper industry in the 
State of Michigan? 

Governor Van Wagoner. A price of 12 cents was set, and we took 
it up with W^asliington, and they gave us a differential of 1 cent. 
That gave us 13 cents, but we have got to get 15 cents before we can 
open up our mines in the Upper Peninsula and produce copper 
profitably. 

But if you are going to have a subsidy like W. P. A., why not 
spend it on something like copper, where we will produce more of 
these basic materials that the Federal Government is so anxious to 
get at this time? 

One objection to such a plan, we find, is that one department in 
Washington doesn't want to pay one price for copper and have another 
depai'tment pay another price without some congressional authority 
to do it. You can appreciate that. And I am wondering if that kind 
of copper — high-priced copper — couldn't be allocated, perhaps to 
nondefense activities, such as the manufacture of products which the 
private consumer wants badly enough to pay this additional price for 
them. If we did that, we would release the copper requhed in manu- 
facture for the defense effort, and not cause embarrassment to any 
Federal department for paybig two different prices for copper. 

The Chairman. In otlier words. Governor, if this committee goes 
back to W'ashmgton and is instrumental in openmg up the Michigan 
copper mines, our coming here would be a success? 

Governor Van Wagoner. Oh, very much, very much as far as the 
Upper Peninsula is concerned. You would be accomplishing three 
things. Li the fh'st place, you are going to save money, because you 
are gomg to have less of a welfare load. The people up there are not 
employed now, and if they are workuig, they will be makmg more 
money, and you will wipe out that welfare problem up there if these 
mines are opened up. Secondly, you would definitely mcrease their 
morale. They have been going along for a long time on a bare exist- 
ence, in order to make ends meet. The third thing is that you need 
moi-e copper as a basic commodity m these defense efforts, and you 
would uicrease slightly the amount of copper produced. 

The Chairman. Has any survey been made as to what your pos- 
sible production of copper might be? 

Governor Van Wagoner. Yes; it was i-ather thoroughly studied 
for many years back to see just how much copper could be produced 
for 12 cents, for 13, for 14, and for 15. But anytliing short of 15 cents 
will not do the job.^ 

The Chairman. Now, Governor, what proposals for State or Fed- 
eral action have you to make for the purpose of, first, providmg 
needed defense facihties, and, second, providing for temporary em- 
ployment? 

Michigan's defense planning 

Governor Van Wagoner. The legislature appropriated $292,000 to 
rehabilitate our armories in the State of Michigan. We have added 
100 State troopers to handle not only the motor patrol, but also any 
emergency that might come along in regard to maintaining law and 
order in our State. 

'See testimony and statement by Dr. Grover C. Dillman, p. 7524 ff. 



jQgg DETROIT HEARINGS 

Also, the highway department is building a series of defense high- 
ways which is going to make it possible to eliminate the moving in of 
a town around a defense plant, like the Ford bomber plant, the Chrys- 
ler tank plant. Information on that, however, will be given by a 
member of the highway department at a later time. I do not want to 
infringe on his testimony, except to say that there is only a 20-foot 
road running out to this new proposed Ford bomber plant. That 
plant is going to hire 60,000 people. That road, you can see, is made- 
quate. What are vou going to do? Are you going to budd up a 
community around"' that plant, or are you going to budd a series of 
highways which will let these people go back and forth to work and 
livo in the place where they are living today? 

It may cost considerable money to build the highways, but it wdl 
be much cheaper than building schools and provide housing and pro- 
viding sewers and water systems and police protection and fire protec- 
tion and the other things^ that are necessary to accommodate a town 
of 60,000 workers. . 

The Chairman. Well, Governor, I think you agree with me that 
we are up against a critical problem in this shift from nondefense to 
defense work. 

Governor Van Wagoner. That is right. 

The Chairman. There is one more point I wish to raise. In San 
Diego we had a witness who was the father of sLx babies. His wife 
was'there with hrni. I asked him if he was saving any money, looking 
toward the future, don't you see, because after all is said and done. 
Governor, as sure as we are in this courtroom today, the time will come 
when many defense workers will face lay-offs; and I still think the 
cushion is' savings by the employee. I will tell you why. Your 
public works program is all very well. The President has authorized 
the United States Planning Resources Board to make a survey of the 
situation. But the Government may be forced to retrench at the 
end of the war. We may not have money to give to Michigan for 
public works. So if some plan, some practical solution, can be 
(>vo1v(k1 by which wo have voluntary savings, or an increase in the 
unemployment compensation, the individual himself will be saving 
money to provide his own cushion after this thing is over. 

I was trying to develop that thought with this San Diego worker, 
and he sai(f that in the first place he could hardly find a place to live in. 
It took him days. Because of his six children, houses were repeatedly 

refused him.^ ^ ^ -^^ c 

I learned that the Federal housing projects contemplated units ot 
only two and three rooms and the three-bedroom houses were not 
ready for use.^ W(> took that up with Washington and now they are 
makincr provision for the construction of some larger houses. 

I asked this man if he was saving any money. He said, "How can I 
save anv money? I receive $135 a month and I pay $18 a week for 
one rooln and a kitchen." That is practically $80 a month for rent. 
As a result of that situation, San Diego created a rent-control com- 
mittee and went to the landlords, and I think the story probably went 
all over the United States. 

But Governor, whether it is voluntary savings on tlie part ot the 
employee, or an increase in unemployment compensation, or the 



1 Sco San Dioeo hoarinps. p. 4839. 
-' Ihid.. P.488K. 



NATIONAL DEFENSE MIGKATION 7089 

purchase of defense bonds, or the dismissal fee or all of them put 
together, it seems to me that living conditions such as I have just 
described cannot be eliminated from the picture as a factor affecting 
the ability of workers to lay sometliing aside for their own future. 
And it also seems to me that this must be done, that it is just as 
necessary as planning for public works after it is over. 

Governor Van Wagoner. I think you are right. 

The Chairman. Governor, what is your comment on the statement 
in the press that of 1,047 Michigan firms which had registered for 
defense orders, only 82 have received such work? 

PRIME CONTRACTS INCENTIVE TO SUBLETTING 

Governor Van Wagoner. As I have said, if the large companies 
had enough prime contracts so that they could see their way clear 
to rehiring and taking care of all of their own employees, then there 
would be a real incentive to subcontract this work. 

Mr. Arnold. It has been my observation that some small plants 
feel that they cannot engage in any of the defense work because bigger 
corporations are getting the contracts even when they have to diversify 
their operations to do it. For instance, the Sherwin-Williams Paint 
Co., of Cleveland, is coming down into southern Illinois and building a 
$40,000,000 bomb- and shell-loading plant, and it is going to operate 
in that field as well as its own field of paint-making. That is a large 
concern, coming into an entirely different line of business. In my 
opinion many of these small manufacturers are going to have to begin 
to think along that line or they will be out of materials and out of 
business. 

farming out of defense CONTRACTS ADVOCATED 

Governor Van Wagoner. I do think there should be some direction 
in the way of awarding contracts. You might say that the parts that 
could be easily manufactured would go to small firms, rather than to 
the large companies that are able to take on more difficult jobs, instead 
of having these big companies take over the manufacture of the easier 
parts and letting the small fellows bid on the complicated ones, which 
they are in no position to do. There might be some effort toward 
allocating those parts to the companies that could do that work. It 
would be a matter of seemg that the subcontract is let for a particular 
part, which could be done by a particular small firm. After deter- 
mining which parts could be made with relative ease, then subcon- 
tracts could be let to these smaller firms that we are talking about. 

On the other hand, if you let the big manufacturer take the easy 
parts to manufacture, and leave only the hard ones for the small 
manufacturer, you are going to find the small fellow unable to compete. 

Mr. Arnold. It is my opinion that the prime contractor is going to 
have to sit across the table from the prospective subcontractor and 
have his blueprints there, and talk as businessman to businessman. 
In that way the small manufacturer can determine what he can do. 

Governor Van Wagoner. That is right. 

Mr. Arnold. It would be better for a prime contractor to sit right 
down here, as we are, and discuss these problems and give the little 
manufacturer the blueprints so he may see what he can do. 

60396— 41— pt. 18 3 



7090 DETHOIT HEARINGS 

Governor Van Wagoner. That is right. To subcontract anything 
that this fellow could make would take a lot of cooperation, which 
maybe we cannot be too optimistic about. But certainly the smaller 
fellows would be able to do some of this work. 

Mr. Arnold. That would tend to keep the skilled men within the 
State of Michigan, instead of having them go to other States and 
create problems there as well as here. 

Air. OsMERs. Governor, I was deeply interested in your reference 
to the Unemployment Compensation Commission work, and your 
own efforts to have the length of payment periods increased. 

amendments to social security act discussed 

I have prepared and am considering the introduction in Congress 
of an amendment to the Social Security Act which will lengthen the 
period of compensation to 26 weeks, on a national basis, and make 
the payments uniform throughout the United States. 

Realizing that is a very complex and technical change in the law, 
I wonder whether you would care to express an opinion on the general 
merits or demerits of such a change. 

Governor Van Wagoner. I think you are certainly moving in the 
right direction. Of course, what you have to figure, if an emergency 
comes, is whether you have enough money to handle it. You would 
certainly have to consider that part of the whole problem. 

Mr. Osmers. We are trying to place the plan on an actuarial basis, 
so that whatever benefits are paid will be figured in at the time of the 
payment. 

I have in mind not the present situation, with its temporarj^ unem- 
ployment as a result of the defense program, but the long pull, when 
there will be not 30 or 40 or 50 billion dollars in Government business 
to hand out. "VMien it is all over, we are going to need some cushion 
for these workers. I don't think that even 26 weeks is going to be 
too long. For example, Mr. Arnold has mentioned a firm going into 
southern Illinois and building a shell-loading plant. We know that 
an automobile factory may be converted into a defense plant and then 
can go back to manufacturing automobiles; but we know that a shell- 
loading plant is through when this thing is over. Those men will be 
stranded, and it seems to me that Government should give that some 
consideration. 

Governor Van Wagoner. I think so too. 

Mr. Osmers. There is one other question I want to ask, concerning 
almost the very last thing you said about this subcontracting proposi- 
tion. 

I constantly hear the charge from my own constituents — and I 
represent a large industrial area — that the big firms, as they call 
them, are hogging all of these defense contracts and holding on to 
them and not subcontracting as much as they should. 

I wonder whether that is true in Alichigan. Have you found any 
evidence of that? 

WITH MORE orders, PRIME CONTRACTORS WOULD SUBLET 

Governor Van Wagoner. I think that goes right back to what I 
originally said. There is no incentive. There is no incentive to 
subcontract to smaller firms when they haven't enough prime con- 
tracts to take care of their own men. 



NATIONAL DEFENSE MIGRATION 7091 

Now, the only way you can do that is to speed up. CongTess has 
appropriated enough nioney to do that; but those appropriations have 
not been translated into orders, and until those orders are out, I don't 
tliink you are going to have that incentive to subcontract. 

Mr. OsMERS. You feel that the application of shorter production 
schedules would help in that direction? 

Governor Van Wagoner. I say move up your completion dates and 
make your contract such that you have to deliver your stuff in a 
certain length of time. 

From the records that we have around here, most of these plants 
having contracts are ahead of schedule, but it seems to me that if we 
could let enough prime contracts so that these fellows would be anxious 
to subcontract and get that help in order to complete their contract 
on time, then you would have a real incentive to subcontract. 

Now, if we can't change this thing over fast enough, then I think 
before we go to W. P. A. or before we go to any kind of relief, we 
ought to consider the possibility of cutting the thing down to a 32- 
hour week, at least during the time that we change over. 

Mr. OsMERS. Is there any possibility of further speed-up in the 
four-shift idea? 

PLANTS RUNNING MULTIPLE SHIFTS 

Governor Van Wagoner. Some of the plants here are running 
three shifts and some of them are running four. I looked at a shell 
plant in Lansing this week, and they are running four shifts up there. 

Mr. OsMERS. Can that idea be carried into other industries to 
advantage? 

Governor Van Wagoner. I don't know any reason why it couldn't 
be worked out, especially if you want to spread the employment. 
The more shifts you have, the more you can spread the employment. 
We do not want to see one group with good jobs and another out of 
work entirely; wdiat we are trying to do is to level it off so that all 
people have at least some work to do, up until the time they move 
into the defense effort on a 100-percent basis. 

The Chairman. Governor, I think you have with you Mr. Lloyd 
B. Reid, deputy commissioner. State highway department. 

Governor Van Wagoner. Yes; and I want to get in the record 
that Mr. Fred C. Taylor, planning engineer, is also here. 

The Chairman. And they are going to testify for the highway 
department? 

Governor Van Wagoner. That is right. 

The Chairman. We want to thank you. Governor Van Wagoner, 
and your staff, for the splendid conti'ibution you have made to our 
record. 

Governor Van Wagoner. And I want to thank the committee for 
coming out to Michigan, where w^e can bring in all of this help to 
testify. If you had this hearing in Washington we probably would 
have had one or two people there, but in this way we are able to get 
more basic information. 

The Chairman. The committee will recess for a few minutes, 

(Short recess.) 

The Chairman. The committee will please come to order. Mr; 
Reid and Mr. Taylor, will you please come forward? 



7092 DETROIT HEARINGS 

TESTIMONY OF LLOYD B. REID, DEPUTY COMMISSIONER, AND 
FRED C. TAYLOR, PLANNING ENGINEER, HIGHWAY DEPART- 
MENT, STATE OF MICHIGAN 

The Chairman. Mr. Reid, will you state your full name and the 
capacity in which you appear before the committee? 

Mr. Reid. Lloyd B. Reid, deputy commissioner, State highway 
department. 

The Chairman. And you are representing Mr. G. Donald Kennedy, 
State highway commissioner? 

Mr. Reid. Yes. 

The Chairman. And Mr. Taylor, will you please state your name 
and the capacity in which you appear before the committee? 

Mr. Taylor. Fred C. Taylor, planning engineer. State highway 
department. 

The Chairman. You have filed a report by Commissioner Kennedy, 
showing the traffic conditions and the traffic areas m and about Detroit 
and the State of Michigan. The statement will be incorporated in the 
record. 

(The statement referred to above is as foUows:) 

STATEMENT BY G. DONALD KENNEDY, STATE HIGHWAY 
COMMISSIONER OF MICHIGAN 

The Michigan State Highway Department is much interested in the problem of 
migration. The expansion of communities or the creation of new communities 
vitally alters the department's problem of providing and maintaining arterial 
highways and intra- and inter-community connection. The large network of 
highways and streets of the State, teeming with millions of vehicle-miles of traffic, 
testifies that the growth of the State and of transportation by motor vehicle has 
been integrated. 

In general this integration has been successful, but for several years past it has 
been evident to the department that a serious deficiency in highway facilities was 
accumulating on the State trunk-line system at a much faster rate than new con- 
struction or reconstruction could be provided. 

An example of this accumulation is provided in the department's study of road- 
way capacity conducted during the past 5 years. These studies indicate that addi- 
tional capacity will be required for 1,271 miles of highway on the trunk-line system 
by 1945. The rate at which mileage of roads with insufficient capacity accumu- 
lates is as follows: 

Miles 

Prior to 1936 388 

1937 to 1940 489 

1940 to 1945 394 

Total 1,271 

In the past 4 years mileage of rural highways becoming congested has increased 
at the rate of 122 miles per year. The department's Federal aid programs of 
1940, 1941, and 1942 have included the widening of 17 miles of highway beyond 2 
lanes. Thus the annual rate of meeting the need for added roadway capacity by 
constructing multilane roads is 5.7 miles per year or only about one-twentieth the 
rate at which the need is created. 

In 1941 traffic on the State routes is up 50 percent above 1936 conditions. 
Estimates of traffic growth made in 1936 did not forecast such an increase until 
5 years hence. As a result, the total road mileage which was expected to exceed 
its safe and tolerable capacity by 1945, obtains in the present year of 1941. In 
other words, the 1,271 miles of State trunk lines now needing to be widened or 
otherwise conditioned for capacity for maximum traffic conditions, represent 
about double the requirements anticipated for this year. 

This picture of inadequacies, from a capacity standpoint, reflects somewhat 
the effect of traffic increases on highway facility requirements. The traffic in- 
crease is that experienced to date. What the full effect of the defense production 
effort will be is conjectural, but worthy of some contemplation. 



NATIONAL DEFENSE MIGRATION 7093 

MICHIGAN INDUSTRY AND DEFENSE PRODUCTION 

Michigan is primarilv a manufacturing State measured on a production value 
standard. In the maximum production year of 1929 manufactured products 
were valued at 4.7 billions of dollars. This is about 7.1 percent of the total 
value of manufactured products in the Nation. It is estimated that production 
during the present year has exceeded the 1929 record although defense production 
is barely getting under way. ,,. , . 

The year 1942 is anticipated to record an all-time peak production for Michigan 
industry. The enormous plant expansion in the State during 1941 is expected 
to reach full production on defense materials in this year. No exact information 
Is available, however, on the full extent of defense manufacture in the State as 
the amounts involved in subcontracting and unpublicized foreign and Federal 
contracts are unknown. 

It is estimated that defense production for each of the years of 1942 and 1943 
will amount to 3^2 billions of dollars. Assuming a drastic cut of say 40 percent on 
normal civil production needs, total manufacture will run about 6 billions of 
dollars per year. This is about one-third greater production than the new peak 
which will be established in the present year of 1941. These estimates parallel 
very closely the estimated increase in national income which is expected to reach 
110 billions by 1942-43, provided the transfer from normal to defense production 
is effected by that time. 

EXPANSION OF BUSINESS AND TRAFFIC 

It is difficult to fully realize the tremendously expanded activity in social, 
"industrial, and economic spheres that will accompany the expansion of national 
income to the figures now estimated. An examination of the activity of the decade 
preceding and following World War No. 1 might give a clue to what may lie 
ahead. Indexed by manufacturing, this activity can be visualized. In the decade 
preceding the last" war, manufacturing for the Nation was valued at approxi- 
mately 20 billions annuallv. In the decade following the war, manufacture per- 
sisted at a level of over 60 billions, three times the former pace. Everyone knows 
of the technological advance which took place during the war and in the following 
period, and of the expanded social and economic activity. 

Highway transportation was perhaps in the vanguard of this expansion. Out 
of the World War expansion grew the necessity for a Nation-wide network of 
highways in the form of a Federal-aid system. In Michigan, year around traffic 
was ina'ugurated for the first time as a war time necessity. Immediately following 
the war, $50,000,000 were provided through a bond issue to build intercity high- 
way connections. Truck and passenger registrations and vehicular traffic grew 
astonishingly. 

HIGHWAY NEEDS AND EXPANDING INDUSTRY 

From the events of the past in highway transport development, it appears that 
the greatly expanded activity which is now taking place would require some con- 
sideration be given to highway transport needs of the immediate future. How- 
ever, such is not the case, as highway expenditures for improved facilities are less 
than normal. According to the Engineering News, 1941 construction in the 
Nation is nearly double last year, largely due to plant expansion for defense. 
But highway construction is less by 10 percent than last year's amount, smaller 
Federal contributions accounting for some of this drop. To date the Federal 
Government has not yet taken full cognizance, in its appropriations, of specialized 
highway needs arising out of a tremendously expanded production plant and 
national income. 

Facts gathered by the Nation-wide highway planning surveys conducted by the 
States and the Public Roads Administration have disclosed the tremendous 
accumulation of highway inadequacies particularly in the vicinity of metropolitan 
areas. In the foregoing some inadequacies applying to the State trunk-line 
system were referred to as indexed by the survey's study of roadway capacities. 
The most serious of these occur in the places of urban concentration and on im- 
portant intenirban connections. 

This overloading of important roadways is emphasized by the current indus- 
trial expansion, as this has occurred in the established industrial centers of the 
State. While the effect of expansion will be felt keenly in nearly all sections of 
Michigan, by far the most serious impact will be on the highway and street facili- 
ties of the Detroit metropolitan district, an area lying within a radius of 40 miles 
of the city. Particular reference will be made to this Detroit district situation, 
as the problem there transcends in importance anything else in the State. 



7094 



DETROIT HEARINGS 



DEFENSE ACTIVITY IIST THE DETROIT AREA 

Defense plant expansion in the State, according to latest Government figures, 
amounts to $316,000,000. Of this expansion, 241 millions, or 76 percent, is in the 
Detroit district. Plant expansion of one quarter of a billion dollars is a very 
considerable item. It is taking place in existing highly crystallized industrial 
areas and in new locations lying on the edge of the city and as far as 25 miles out 
from the city limits. Swinging these new plants into production, plus sustained 
though somewhat lessened normal operations, will severely strain existing facilities 
which were believed to be seriously overtaxed several years ago. 

The geographical distribution of the expansion is presented in the attached 
table. The primary contracts officially published by the Office of Production 
Management as of August 9, 1941, are shown in this table. They show accurately 
the spread of production expansion, but represent a fraction of the dollar value of 
the production planned. As before stated, foreign contracts and undisclosed 
Federal contracts and the subcontracting values are not known. 



INCREASES AND CHANGES IN INDUSTRIAL EMPLOYMENT 

The accompanying employment data for the corresponding district are shown 
in the following tabulation." Statistics are compiled from reports of the Unem- 
ployment Ck)mpensation Commission. 

Employment data, selected plants in defense industries 



Area 


Employ- 
ment May 
1941 


Anticipated 

additional 

October 1941 


Area 


Employ- 
ment May 
1941 


Anticipated ■ 

additional 

October 1941 


Eiver Rouge 

Milwaukee Junction 


162, 688 
126, 283 
82, 146 
34,903 
7,900 


7,994 
21,420 
10,319 

3,693 
13,445 


Washtenaw County — 


7,078 
28,145 


61,968 
1,577 


Total 




Other Detroit 


449, 143 


120,416 


Warren township 







Source: Research, statistics, and planning section, Michigan Unemployment Compensation Commission. 

Dollar value of national defense primary contracts and plant expansion awarded in 
Detroit area distributed to important industrial districts 







Expenditures for material and plant < 




District or place 


Material 


Plant 


Total 


Detroit: 

A. River Rouge' 

B. Milwaukee Junction -- 

C. Connors Mack 

D. Detroit general 2 


$147,872,853 
85,611,168 
33,094,679 
42, 645, 067 


Percent 

22.7 

13.2 

5.1 

6.5 


$34, 754, 790 
34, 257, 524 

7,631,115 
28, 557, 745 
80, 602, 283 

5, 800, 000 


Percent 
HA 
14.4 
3.2 
11.8 
33.3 
2.4 


$182, 627, 643 
119,868,692 
40, 730. 794 
71,202,812 
80, 602, 283 
30, 134. 286 
485, 979 
147, 380, 590 
1,, 538, 857 
215,118,382 

1,829,109 
268, 739 


Percent 
20.5 
13.4 
4.6 
8.0 
9.0 


Plymouth _ 


24, 334, 286 

485,979 

141,680,590 

275,513 

174,098,360 


3.7 
.1 

21.8 
.1 

26.8 


3.4 




.1 




5, 700, 666 

1,263,344 

41,020,022 

1,829,109 
268, 739 


2.4 

.5 

17.0 

.7 
.1 


16.5 


Ferndale and Royal Oak 

Warren Township.. - 


.2 
24.1 


Airfields: 

Selfridge Field 


.2 








.1 










Total . - 


650,098.495 


100.0 


241,684,671 


100.0 


891, 783, 166 


100.0 







1 River Rouge district comprises the southwestern section of Detroit, the eastern section of Dearborn, 
the municipalities of River Rouge, Ecorse, Mclvindalc, Allen Park, Lincoln Park, Wyandotte, and Tren- 
ton, and Qrosse lie. ^ ,-,^i-x ^ ■ 1 J ^ ■ A- 

2 The Detroit general district is comprised of all of the incorporated area of Detroit not mcluded m ais- 
tricts A, B, and C. , ,-, ^ -u ^ .n. ■* j 

» Ypsilanti includes the city of Ypsilanti and that portion of ■S\ ashtenaw County between the city and 
the Wayne County line. , ^, » j v. rvm e t>,„ 

* Amounts of contracts and awards and permits for plant expansion are those reported by- omce oi I'ro- 
duction Management, Bureau of Research and Statistics, to Aug. 9, 1941. These figures do not include 
subcontracts or unpublished foreign and TTnited Stales contracts. Therefore, the material figures only 
give a picture of the geographical spread of defense activity. 



NATIONAL DEFENSE MIGRATION 



7094-A 



XOo2 




7094-B 



DETROIT HEARINGS 



Q^ lis 

e^ ill 



Sail* i il 
liill il 






H- 




z ^ 




uj 2 




Z z 


/- ■ 


Jl 




Zajx 


-■*»«' 


5» 




-> > 




X<o< 




1 '-'^il 




! sflf 






1 x° 




i O*" 




! ti^H 




1 < ». 




1- 






t'*- -, . .1 • ■ 




'aiiiiiip 



NATIONAL DEFENSE MIGRATION 7095 

Labor to meet the demand of the industrial expansion will be drawn from other 
areas of the country and other sections of the State, from the population not now 
gainfully employed, and from curtailment of normal civil production. The 
department is not in a position to estimate the extent that each of the sources 
will contribute to the total need. The experts on labor demand and supply will 
probably place that information before the committee. 

Of this, however, the department is certain: That community expansion will 
take place in the area and that serious commuting problems will take shape that 
will affect the volume and character of highway transportation. The demand 
for improved facilities will be great. 

A large reservoir of labor is contained in the Detroit area. This will be the 
principal source of labor supply which must be reoriented to new and expanded 
locations. The principal new sites are the Ford Army bomber plant at Ypsilanti; 
the Army tank arsenal, and the naval arsenal, both in Warren Township in 
south Macomb County, and the somewhat smaller district at Plymouth. The 
estabUshment of these new districts is characteristic of the way industrial expan- 
sion has taken place in the past in the Detroit area. 

THE SPREAD OF INDUSTRIAL ACTIVITY 

Industry has expanded laterally and has progressively established itself on the 
periphery of the growing city of Detroit. Expansion to the size visualized by 
industrial leaders was in many cases impossible because of restrictions imposed 
by the development of contiguous area. An example is found in the Ford Motor 
Co. It was first established in Highland Park, a city now entirely surrounded by 
the city of Detroit. Some 20 years ago the industry was established at the River 
Rouge locations, then an open area. The Rouge development is probably the 
largest single industrial establishment in the world. But now the Rouge is 
considered too crowded and restricted for further expansion. While some 
additional defense plant is being built there, the major plant increase is in the 
Ypsilanti area, some 20 miles west of the Rouge. Similar examples of expansion 
can be cited in other industries. 

The total effect of continued industrial expansion has been to spread the city 
of Detroit and its metropolitan district over an area of some 2,000 square miles. 
This lateral expansion of industry and residential area has been made possible by 
the increased use of the automobile as a transportation facility. This use has given 
breadth rather than height to the area. Building statistics of Detroit show the 
tremendous preference for single-family dwelling units over multiple dwelling 
units. In 1940, out of approximately 10,000 permits, only 200 were for multiple 
units. 

The fact that this type of expansion has given a character of breadth rather 
than height to industry and residence in greater Detroit, is perhaps the principal 
reason why the mass transportation system as it now exists was not developed 
to care for the important working population and why that population uses it so 
little. 

INDIVIDUAL TRANSPORTATION FOR WORKERS 

During an intensive survey of the traffic situation in Detroit made by the 
department in 1936, it was determined that only 20 percent of industrial em- 
ployees ride streetcars and busses, while about 70 percent of the downtown 
workers, office and retail store employees, use these mass transportation facilities. 
The reason for this situation is found primarily in the fact that the original system 
was laid out to accommodate the business district and was not developed to serve 
expanding industry. 

The wide dispersion of industrial employees over the Detroit area regardless of 
the location of the industrial sector in which they are employed is astonishing 
evidence not only of the dependence the workman placed upon individual trans- 
portation but of the extent to which Detroit industry itself must depend on 
motor transportation for successful operation. The efficiency with which the 
enlarged production machine of the area will function will depend on supplying 
labor at the factory doors. 



7096 



DETROIT HEARINGS 




NATIONAL DEFENSE MIGKATION 



7097 




7098 



DETROIT HEARINGS 




NATIONAL DEFENSE MIGRATION 



7099 



Distances industrial employees travel to work — frequency distribution of lengths of 
trips to factory from various parts of the Detroit area 





Place of residence 






l-way trip length (ranges) 


Macomb 
County 


Oakland 
County 


Washtenaw 
County 


Detroit, 
Ham- 

tramck, 

Highland 

Park 


Dearborn 

and miscel- 
laneous 


All 




Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


40 and over 

35 to 39 


0.0 





2.4 

6.0 
20.5 
30.1 
25.3 
15.7 


0.0 


2.4 

8.4 
28.9 
59.0 
84.3 
100.0 


0.5 

.5 

1.0 

2.1 

3.7 

9.5 

11.6 

19.5 

51.6 


0.5 

1.0 

2.0 

4.1 

7.8 

17.3 

28.9 

48.4 

100.0 


2.4 


7.3 
2.4 
4.9 
2.4 
4.9 
9.8 
65.9 


2.4 
2.4 
9.7 
12.1 
17.0 
19.4 
24.3 
34.1 
100.0 


0.2 
.1 
.3 
.2 

.5 

2.3 

13.8 

41.3 

41.3 


0.2 
.3 
.6 

.8 

1.3 

3.6 

17.4 

58.7 

100.0 


0.0 



1.3 
3.2 
7.8 
9.7 
24.5 
53.5 


0.0 





1.3 

4.5 
12.3 
22.0 
46.5 
100.0 


0.3 
.1 

.5 

.7 

1.4 

4.2 

13.7 

36.4 

42.7 


0.3 
.4 


30 to 34 


25 to 29 

20 to 24 

15 to 19 - 

10 to 14 

6 to 9 


1.6 
3.0 
7.2 
20.9 
57.3 
100.0 


0to4 


Total 


100.0 




100.0 




100.0 




100.0 




100.0 




100.0 





Distances nonindustrial employees travel to work — frequency distribution of lengths 
of trips to place of work from various parts of the Detroit area 





Place of residence 






l-way trip length (ranges) 


Macomb 
County 


Oakland 
County 


Washtenaw 
County 


Detroit, 

Ham- 

tramck. 

Highland 

Park 


Dearborn 
and miscel- 
laneous 


All 




Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


Per- 
cent 


Cu- 
mu- 
lative 


40 and over ._. . 


0.0 


2.6 

2.6 

2.6 

5.2 

11.7 

10.4 

64.9 


0.0 


2.6 

5.2 

7.8 

13.0 

24.7 

35.1 

100.0 


0.0 
.8 





2.3 

3.1 
12.3 
12.3 
69.2 


0.0 

.8 

.8 

.8 

3.1 

6.2 

18.5 

30.8 

100.0 


0.0 

2.8 



1.4 





8.5 
11.3 
76.0 


0.0 

2.8 
2.8 
4.2 
4.2 
4.2 
12.7 
24.0 
100.0 


0.1 

.3 

.3 

.5 

.3 

2.2 

10.7 

44.8 

40.8 


0.1 

.4 

.7 

1.2 

1.5 

3.7 

14.4 

59.2 

100.0 


0.0 

.9 





.9 

7.9 

6.1 

33.3 

50.9 


0.0 

.9 

.9 

.9 

1.8 

9.7 

15.8 

49.1 

100.0 


0.1 

.4 

.3 

.6 

.6 

2.7 

10.5 

38.2 

46.6 


1 


35to39 




30 to 34 . . 


g 


25 to 29 




20 to 24 

15 to 19 


2.0 


10 to 14 

5to9 

0to4 


15.2 
53.4 
100.0 


Total 


100.0 




100.0 




100.0 




100.0 




100.0 




100.0 









7100 



DETROIT HEARINGS 



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7102 DETROIT HEARINGS 

Investigation by the Street Railway Commission of Detroit indicates that about 
10 percent of the industrial employees reside in contiguous cities and 10 percent 
in the fringe area surrounding the city and 80 percent live within the city. But 
work-travel should not be thought of entirely in terms of people living in the 
suburbs and coming to jobs in Detroit. Of growing importance is the travel of 
Detroit people to employment in industrial locations far outside the city's limits. 
The new industrial centers at Plymouth and Ypsilanti are illustrations that the 
migration of industry creates transportation problems equally important to those 
created by the movement of people to the suburbs. 

The reorientation of employees to industry in the accelerated production period 
immediately ahead will be accomplished in two ways; by intradistrict migration 
and by intradistrict commuting. The possibility of intradistrict migration ap- 
pears "to be greater than in previous industrial expansions. Particularly is this 
true with reference to the Ford plant at Ypsilanti. 

There has been a reluctance on the part of workmen to follow the industry with 
residence. Detroit Street Railway officials estimate that only 10 percent of indus- 
trial homeowners change residence when the locale of their employment changes. 
The worker has regarded individual transportation as preferable to shift of resi- 
dence. Perhaps uncertainty of permanent connections with any industry has 
forced his preference to transportation. 

DISTANCES TRAVELED BY WORKERS 

Detroit workmen do travel to their work over considerable distance. The 
highway planning survey has cross-sectioned the extent of daily travelling by 
automobile by industrial and nonindustrial workers. The results of this investi- 
gation are indicated in the table (p. 7099). The median one-way trip to work 
for both classes of workers is around 10 miles or about 20 miles of driving per day 
to work. 

Distance, however, is not so much a factor in "to work" travel by automobile 
as time required in transit. During peak hours industrial, office, shopping, and 
commercial traffic appear on the streets and highways of the Detroit area simul- 
taneously. During these periods due to congestion and delays, speed is reduced 
to a crawl and in a great many instances it takes about 1 hour to traverse city 
areas a distance of 10 miles. Along the main radiating arteries from the central 
business district through the satellite communities located on them it takes 
approximately 1}4 to 1}^ hours to arrive at the 15-mile circle. For many workers, 
going and returning to work adds from 2 to 3 hours to their working day. 

EFFECTS AND COSTS OF CONGESTION 

From an economic standpoint this is important. The cost is too high. The 
consumption of fuel under conditions of congestion driving is more than double 
that of free movement. This penalty falls on the person least able to afford it — 
the workingman. 

The provision of express-highway facilities, removal of bottlenecks, provision 
of grade-separation structures at railroad and other street intersections would be 
economically justified for it has been estimated that Detroit motorists paid 
$28,000,000 last year for congestion. 

The extent of congestion and the dislocation of traffic which it causes is shown 
by comparative traffic figures for 1936 and 1941. The department's traffic 
studies in Detroit show a traffic increase in the central business district of only 
7.6 percent during this time. Two and a half miles out, the increase was 9.9 
percent, but in the area between the 2}i mile circle and the city limits, the 
over-all increase was 60 percent, and some streets show an increase of 200 percent. 

These figures demonstrate the extreme congestion on the streets approaching 
the center of the city. They show that traffic is seeking its own relief by avoiding 
the central district and utilizing secondary and residential streets in the outlying 
area even though that entails considerable inconvenience and greater travel 
distance to its destinations. The effects of this mass detour movement on 
central district business and values and on the adequacy of existing outlying streets 
are already serious. 



NATIONAL DEFENSE MIGRATION 



7103 




60396—41 — pt. 18- 



7104 



DETROIT HEARINGS 




NATIONAL DEFENSE MIGRATION 7105 

DANGERS AND COSTS OF MIGRATION 

It is believed that unless the employees' "time-distance" factor can be reduced 
very considerably, migration of people to the new outlying industrial sites is likely 
to be greatly accelerated. The extensive and hasty intradistrict migration of 
industrial workers to these outlying areas under pressure of the emergency 
would result in industrial clogging. This movement should be prevented or at 
least deferred so that orderly planning and development of the new cities can take 
place. 

If it is assumed that a city of 100,000 population will be created near Ypsilanti 
by the operation of the Army bomber plant, it may be worth while to ponder the 
costs of developing such a city. Based on extensive analysis of governmental 
receipts and expenditures by the Michigan Highway Planning Survey, the 
capital investment and operating costs are presented for a hypothetical city of 
100,000 population. 

Public facilities : Schools, governmental buildings, fire stations, water 
supply, sewerage and sewage disposal, pavements, sidewalks, 
parks, etc $27, 000, 000 

Private facilities: Residences, stores, shops, finnacial institutions, 
service places, etc. (based on a valuation of $1,500 per capita and 
a valuation of 60 percent of market value) 225, 000, 000 

Total about 252, 000, 000 

This cost does not include the State or Federal costs involved in serving a city 
of this size. 

Operating costs are estimated to be about $5,000,000 annually. 

Perhaps the creation of a city of this size would be economically justified pro- 
vided, of course, that permanent industrial operations could be anticipated with 
some degree of certainty. But even though justified, the building of such a city 
should be deferred for post-defense activity, thus allowing time for orderly and 
careful planning. 

HIGHWAYS FOR COMMUTINn WORKERS 

Much of the cost and waste involved in hurried emergency migration of popula- 
tion can be avoided if it is made possible for workers to commute from their 
present homes to the new job location. An industrial express highway tapping 
the heart of the labor market in the city of Detroit and connecting the principal 
industrial districts would accomplish this emergency purpose. At the same time 
it would serve the area's continuing highway needs. 

The department's plan of motorways for the Detroit area includes such a route. 
The industrial exj^ressway known as the McGraw-Harper Crosstown Motorway 
was conceived as the axial route of that plan. It would bisect the Detroit labor 
reservoir, extending northeasterly beyond the congested fringe to a point north 
of Mount Clemens. Its southwesterly extension would be the initial part of the 
projected Chicago to Detroit interregional expressway. 

Thus, this projected highway is worthy of serious consideration as a vital part 
of both the industrial expansion program for defense and the planned long-range 
future highway development program which will fit well into the higher national 
income level which must inevitably follow the war. 

Vital highway connections are as much a part of plant expansion as the assembly 
lines themselves and it would be fitting that they be so regarded by those working 
for expanded production. 

HIGHWAYS FOR THE BOMBER PLANT 

In connection with the Ford bomber plant development, the department in 
cooperation with the counties involved, the Public Roads Administration, and 
Ford Co. officials, laid out a general plan of plant-gate access routes. This plan 
provides for no intersections at grade whatever, and for complete separation of 
opposing traffic. 

The objective was to completely eliminate all friction commonly experienced 
when large volumes of traffic are experienced at shift changes. A half-hour delay 
getting away from the plant and 20-mile speeds on a journey of 20 to 25 miles 
ending in Detroit city traffic would discourage any worker from continuous em- 
ployment at the plant. The inevitable large labor turn-over, with the accom- 
panying waste and inefficiency in production, cannot be tolerated. 



7106 DETROIT HEARINGS 

By the design provided in the access-road plan, 50-miles-per-hour speeds are 
permitted for the 60,000 workmen who will be employed there. But from one- 
half to 2 miles away from the plant, congested roads leading into Detroit will 
prevail. With one exception, they are two-lane roads now operating near or in 
excess of capacity. The exception is the divided four-lane route of U S 112 lead- 
ing to Detroit, via Dearborn, which, because of uncontrolled roadside exploita- 
tion, is rapidly assuming characteristics of a city street. 

Under these conditions, it appears that immediate consideration must be given 
to the construction of the express-way link between Detroit and Ypsilanti. For 
the betterment of industrial movement within the city, the cross-town portion of 
the route should likewise be started. The extension of the route to Mount 
Clemens should also receive consideration. 

This is not only a legitimate but a basic industrial defense-production item. 
The cost would be about $65,000,000. The priority of its elements should be 
determined and there should be immediate Federal action to get them built. 
The cost of this logical part of the defense-production program is a small percentage 
of the value of the plant and its anticipated production. 

BENEFITS OF ADEQUATE HIGHWAYS 

It is firmly believed that migration of the damaging kind can be reduced to 
orderly proportions by the provision of adequate industrial highway transporta- 
tion facilities. The unhealthy migration which occurs in emergency boom con- 
ditions is not only a problem of housing but of whole community building. Com- 
munities of the kind that follow in the wake of booms are either total losses or 
long-continuing public liabilities. 

In the time permitted by the emergency a desirable community cannot be built. 
The skills and materials for building it are required for defense product ion. H igh- 
way skills are more readily available and the materials are not necessarily 
restricted. The building of better transportation arteries would establish a 
pattern for metropolitan growth and save much of the endless expenditure made 
necessary by unplanned expansion. 

There is pressing need for other links in the network of the metropolitan area 
of Detroit. Quick transport by automobile to the recreation areas lying on the 
periphery of the metropolitan district is as much a necessity to working people 
as quick transport to the places of work. Week-end and holiday congestion on 
highways leading into Detroit begins about 35 to 40 miles from the city. It is as 
important to relieve this as it is to provide adequate roadways for the traffic 
going out of the city on workdays. 

POST-DEFENSE PROGRAM 

A word might be added in regard to the post-defense situation. Any shrinkpge 
of sizable proportions from the $110,000,000,000 national income estimated as the 
peak of the defense effort would bring chaos to the country. Past depressions 
would seem like eras of prosperity in comparison. To sustain the national 
income at high levels, building and proaucing will be imperative. Highways will 
be a vital part of the building program and indispensable to efficient production. 
The accumulated deficiencies in the State system will be a fruitful source of 
projects for the program of public works if needed to absorb the release of defense 
workers and soldiers. 

The department has been collecting data on the highway situation m Michigan 
through its highway planning sureey. With this data a comprehensive plan for 
the State trunk-line system is being evolved. From this plan an orderly adequate 
program for the post-defense period can be made available. It is believed that 
the department will be ready, should public works be determined essential in 
shifting defense workers and soldiers back to civil activities. 



TESTIMONY OF LLOYD B. REID AND FRED C. TAYLOR— Resumed 

The Chairman. If you will outline your report briefly, the members 
of the committee may wish to ask some questions afterward. 

Mr. Reid. We feel that the new defense industries were located m 
this area for possibly two principal reasons: We have skill in the 
business of production, and we have skilled management and we have 
a reservoir of skilled trades. That is probably the basic reason for 
locating these industries in the Detroit area. 



NATIONAL DEFENSE MIGRATION 7107 

PLANS TO FACILITATE TRANSFER OF WORKERS TO NEARBY DEFENSE JOBS 

It is our feeling the transfer of men from the job they are now on 
to this other job can best be done by minimizing the interruption and 
disruption of the shift from peacetime industry to defense industry. 

The ideal set-up — and it seems the minimum adjustment to be 
made — would have this man stay where he lives, hang up his apron in 
one shop today and go to work in another shop on a defense article 
tomorrow. We think this can be greatly facilitated by construction 
of highways which will reduce to a minimum the traveling time from 
his home to the place where he works. That is, the time consumed 
and the cost are the two prime factors that determine whether he 
wants to move or not. If he can travel from his old home to his new 
place of business at a reasonable expense and within a reasonable 
length of time, there is no incentive for him to move. 

The Chairman. This shift from nondefense to defense industry is 
bound to cause great unemployment, isn't it? 

Mr. Reid. Yes. 

The Chairman. And, therefore, if you had highway construction 
going on, it would take up a little of that problem, wouldn't it? 

large concentrations of FORD INDUSTRIES 

Mr. Reid. That is a consideration. But there are other 'impor- 
tant benefits. Let us cite the case of the Ford bomber plant. I 
understand that the Ford industries today employ 85,000 men, and 
I understand that is the largest industrial concentration in the world. 

Now, they are proposing to go out into the open country and set 
up an industrial organization that will employ 60,000 men, and I 
understand that will be the second largest industrial concentration in 
the world. 

Mr. OsMERs. Will that be in addition to their 85,000 men? 

Mr. Reid. Yes. Entirely separate. If I may step to the map 
here, I will show you these squares each of which represents 10,000 
employees in the present Ford industrial area [indicating].^ Now, 
they are proposing to go out here and set up this new area. 

The Chairman. How far away is that? 

Mr. Reid. About 15 miles, I guess; and there are no highways, 
nothing but local roads to take care of access to that plant. When 
it is a good day, you don't need a roof on the building; but every day 
you must have some transportation facilities to get men to work. 

proposed access highways 

Mr. Osmers. Is that black line that you call the "Detroit industrial 
expressway" in being today, or is that proposed? 

Mr. Reid. That is proposed entirely; it is a proposed limited-access 
highway, with divided lanes and separated by grades. That will 
take care of this tremendous outpouring of employees when the 
whistle blows. 

Mr. OsMERs. What is its extent? 

Mr. Reid. It extends on up the eastern side and bisects the 
residential areas of these people. The thing we have done, as this 
map shows, is to prepare for the employees where they live. They 

• Reproduced on p. 7094-A 



7108 DETROIT HEARINGS 

have got to come from where they Hve and they have got to go where 
the industrial concentrations are. 

Mr. OsMERs. It is not proposed to build housing at this new Ford 
plant? 

Mr. Reid. You can provide a way for these people to come to work 
from where they live now an awful lot easier than you can provide 
housing there. 

Mr. OsMERS. How far along is this plan for the expressway? Is it a 
matter of legislation yet? 

Mr. Reid. It is in the planning stage. That was our No. 1 project. 
That was to be included in the defense highway scheme. 

Mr. Osmers. What is the length of the expressway? 

Mr. Reid. Eventually it would extend to Toledo and Chicago. 

Mr. Osmers. And the black line on the map represents how many 
miles? 

Mr. Reid. Twenty-five or thirty. You see, this bisects the entire 
present Detroit industrial area. It would serve both as an access 
road to the present industrial plants and to the proposed future 
industrial plants. 

Mr. Osmers. What would the cost of such an expressway be? 

Mr. Reid. Well, it will depend on how far you go with it. 

Mr. Osmers. In the stage represented on the map. 

Mr. Taylor. It is in the report at $65,000,000. 

Mr. Osmers. A large proportion will be on land that must be 
acquired, I presume? 

Mr. Reid. Yes. 

Mr. Taylor. It traverses the densely built-up section of the city 
of Detroit. 

Mr. Arnold. Mr. Reid, if you don't have some new highway 
construction, you can visualize such a situation as we found in the 
Baltimore area where a worker testified that to travel 15 miles from 
his home to his work took 2 hours in the morning and 2 hours in the 
afternoon. 

Mr. Reid. Exactly. There are two factors, the time consumed and 
the cost; and they work together. If a fellow has to stop at traffic 
lights and average 5 miles an hour, his gasoline consumption runs 
away up, although the distance traveled is only 15 or 20 miles. He 
may be as long as 2 hours in doing that , and it may cost him as much 
to operate his car as it would to drive 100 miles. 

We don't look at this thing as a stopgap construction between the 
change in occupation, but as a basic need, a basic part of the defense 
industry — just as much so as the roof on the building. 

Mr. Osmers. Is there any highway now in existence that approxi- 
mates thi;> road? Is there any main road or through highway of any 
kind that parallels it or follows its course? 

Mr. Reid. U S 112 passes near the plant, and it is a double-lane 
highway. We have a plan for a number of roads. We can't solve a 
problem like that with one highway. The plant has to be accessible 
on all roads. 

Mr. Osmers. You have to have feeder roads? 

Mr. Reid. Yes, sir. The principal feeder has to be this way, be- 
cause this is where the people live, but it extends in each direction, and 
it is planned to develop a highway system in all directions. 



NATIONAL DEFENSE MIGRATION 7109 

The Chairman. In other words, Mr. Keid, you would classify that 
as really a national-defense project, wouldn't you? 
Mr. Reid. Yes; absolutely. 

HIGHWAY CONSTRUCTION DEPENDENT UPON FEDERAL AID 

Mr. OsMERS. Is it proposed by the State Highway Department of 
Michigan to apply to the Federal Government for funds? 

Mr. Reid. We had hoped to have it financed out of the defense 
highway bill. 

Mr. OsMERs. The one that was defeated? 

Mr. Reid. Yes, su\ I understand a substitute bill has since been 
introduced. I am not sure what progress has been made. 

Mr. OsMERS. The substitute may have a better chance if it is 
placed on a different basis. 

Mr. Reid. The new plant is going to be in production in January, 
and we are reaching the time of year when we have to stop our concrete 
mLxers on accomit of the weather. That is why the situation is 
becoming serious. 

EIGHTY-FIVE PERCENT OF MATERIAL TRANSPORTED BY TRUCK 

It is proposed to transport not only the men, but 85 percent of the 
material commg into this plant by truck. It is a staggering opera- 
tion, and we have watched it grow, and I don't believe we have 
expended our thinkmg to the size of this thing. 

Mr. OsMERS. To an observer just commg in from the outside, in 
view of the transportation problem it doesn't seem, on the face of it, 
to be a wise location. 

Mr. Reid. That particular location, I believe, was selected partly 
because the Ford Motor Co. owned the land and partly because it is 
ideally located as an airport. It is absolutely flat. It is also close 
enough to the Ford concentration there so that their facilities and 
their personnel can be available to both plants. 

The Chairman. Mr. Reid, we are glad you have called the attention 
of this committee to your problem. We thank both of you gentlemen 
very much, especially for your report, I know it will be valuable to 
to us. 

Mr. Reid. We thank you for the privilege of appearmg before the 
committee. 

The Chairman. Our next witness is Mrs. Decent, who has two of 
her children with her here. 

TESTIMONY OF MRS. MAYNARD DECENT AND BONNIE JEAN 
DECENT, MUSKEGON, MICH. 

The Chairman. Mrs. Decent, please have a seat. I hope you and 
your children will feel at ease. You will not be cross-examined, or 
anything of that kind. We think you are just as important as the 
Governor of the State or any other witness who appears before us. 

Congressman Arnold will ask you a few questions. 

Mr. Arnold. Mrs. Decent, I must confess that I do not know why 
you are turned over to me for questioning, because heretofore at all 
of the hearings Chairman Tolan has insisted upon questioning those 
in whose welfare he is so much interested — that is, those who have 



7110 DETROIT HEARINGS 

migrated from one part of the State or one part of the comitry to 
another. 

The committee, Mr. Chairman, is indebted to Mr. Krauss,^ who is 
among those present, and to the Federal Works Agency, for as- 
sistance in connection with the selection of these defense-migrant 
witnesses. 

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

Mr. Arnold. Mrs. Decent, will you state your name, age, and 
address for the record? 

Mrs. Decent. Mrs. Maynard Decent. I am 28 years of age and 
I live at 1622 Sanford Street, Muskegon Heights, Muskegon, Mich. 

Mr. Arnold. How many children have you? 

Mrs. Decent. Five. 

Mr. Arnold. What are their ages? 

Mrs. Decent. The oldest one is 8, and 6, and 3, and 2, and 5 months. 

Mr. Arnold. How long have you been living in Muskegon? 

Mrs. Decent. Well, I have only lived there about 6 weeks, but my 
husband has been working there longer. 

Mr. Arnold. Since the spring? 

Mrs. Decent. Yes. 

Mr. Arnold. Where did you live before that? 

Mrs. Decent. Escanaba. 

Mr. Arnold. That is in the northern part of the State? 

Mrs. Decent. Yes, sir. 

Mr. Arnold. It is quite a distance from Muskegon, isn't it? 

Mrs. Decent. Yes, it is. 

Mr. Arnold. How many miles? 

Mrs. Decent. Oh, it is 450 miles. 

Mr. Arnold. Was your husband working in Escanaba? 

Mrs. Decent. Well, not at the time he came to Muskegon. 

Mr. Arnold. But he had been employed? 

Mrs. Decent. He had been employed; yes. 

Mr. Arnold. Why did you leave Escanaba? 

Mrs. Decent. Well, his work wasn't steady. 

Mr. Arnold. Well, why did you come to Muskegon? 

Mrs. Decent. Well, he has brothers in Muskegon and they wrote 
him and told him that they thought he could find employment in 
Muskegon and he came down there. 

Mr. Arnold. Because of the defense efforts in Muskegon? 

Mrs. Decent. Yes, sir. 

Mr. Arnold, There would be job opportunities? 

Mrs. Decent. Yes. 

Mr. Arnold. When your husband came to Muskegon did you or 
any of the children come with him? 

Mrs. Decent. No. 

Mr. Arnold. He came first and located a job and then sent for his 
family? 

Mrs. Decent. Yes. 

Mr. Arnold. Did he go back for you? 

Mrs. Decent. Oh, no, I drove down. 

Mr. Arnold. You drove down with the children? 

Mrs. Decent. Yes. 



' Eugene A. Krauss, housing manager, Defense Housing Division of Federal Works Agency, Muskegon, 
Mich. 



NATIONAL DEFENSE MIGRATION 7lXX 

Mr. Arnold. Is the firm your husband is workmg for engaged in 
defense work? 

Mrs. Decent. Yes. 

Mr. Arnold. We are very much interested in housing conditions. 
Did you have any trouble finding a place to live? 

Mrs. Decent. Yes, sir; we did because we have children and it was 
hard to find a place. 

Mr, Arnold. You mean that landlords don't care to have children 
in their apartments or homes? 

Mrs. Decent. Most of them don't. 

Mr. Arnold. They don't object to dogs or cats? 

Mrs. Decent. No. 

Mr. Arnold. But you finally found a place to live. Will you tell 
us something about where you are living and what you are paying for 
it and what you have for the money you pay out? 

Mrs. Decent. Well, we are living in a furnished apartment and we 
pay $5.50 a week and we have three rooms. 

Mr. Arnold. How large are the rooms? 

Mrs. Decent. Well, they are quite large. 

Mr. Arnold. Three rooms including a kitchen? 

Mrs. Decent. Yes; including kitchen. 

Mr. Arnold. Do you have a bath? 

Mrs. Decent. Well, just one. There is one bathroom downstairs 
and one bathroom upstairs but there is only one bathtub. 

Mr. Arnold. Is this a brick building, an apartment house, or a 
converted family dwelling? 

Mrs. Decent. Well, I think it was an old hospital. It is just a 
wood, frame building. 

Mr. Arnold. And several other families live there. Do you know 
how many people live in the building? 

Mrs. Decent. Well, I think there are about 25. 

Mr. Arnold. And the 25 includes children? 

Mrs. Decent. Yes, sir. 

Mr. Arnold. And they use the two bathrooms which are the only 
facilities that you have? 

Mrs. Decent. Yes, sir. 

Mr. Arnold. What part of town is this building in? 

Mrs. Decent. Well, it is in the heights. 

Mr. Arnold. On a paved street? 

Mrs. Decent. Yes, sir. 

Mr. Arnold. Is it a nice neighborhood? 

Mrs. Decent. Well, yes; it is. 

Mrs. Arnold. Are you happy there? 

Mrs. Decent. Well, I wouldn't exactly say I am happy there. 

Mr, Arnold. Would you rather be back in Escanaba? 

Mrs. Decent, No; I would rather not be back in Escanaba, but I 
would like to find some place different to live in, 

Mr, Arnold. You had better liying conditions in Escanaba? 

Mrs. Decent. Yes. 

Mr. Arnold. If you could have in Muskegon what you had in 
Escanaba you would be extremely happy? 

Mrs. Decent. Yes, sir. 



7112 DETROIT HEARINGS 

Mr. Arnold. You look happy and these children look as if they 
arc satisfied and contented. How much does your husband earn? 

Mrs. Decent. Now? 

Mr. Arnold. Yes. 

Mrs. Decent. He makes 50 cents an hour. He works 10 hours a 
day. 

Mr. Arnold. Is that about $30 a week? 

Mrs. Decent. Yes, sir. 

Mr. Arnold. $120 a month and you pay $25 or $30 a month rent? 

Mrs. Decent. Yes. 

Mr. Arnold. What firm does he work for? 

Mrs. Decent. He works for the Shaw-Crane Co. 

Mr. Arnold. And they are engaged in defense production now? 

Mrs. Decent. Yes. 

Mr. Arnold. Now, on this $30 a week do you manage to get along 
pretty well? 

Mrs. Decent. Oh, yes; we get along. 

Mr. Arnold. Are you able to save any money? 

Mrs. Decent. No; we haven't been. 

Mr. Arnold. Do you think you will be after j^ou get adjusted to 
your new home? 

Mrs. Decent. Well, we hope to. 

Mr. Arnold. This committee, as the chairman has said, believes 
that one of the "cushions" after the depression overtakes us will be 
what the family has been able to accumulate. But with five children 
to clothe and feed, isn't it going to be rather difficult in your case? 

Mrs. Decent. Yes. 

Mr. Arnold. Wouldn't you and your family, since your husband 
is working on defense work, be eligible to apply for a defense house 
under the defense housing project? 

Mrs. Decent. Yes. 

Mr. Arnold. Have you applied? 

Mrs. Decent. Yes; I have applied. 

Mr. Arnold. What stage is that in? 

Mrs. Decent. Our application has been accepted but the Shaw- 
Crane is on strike right now. 

Mr. Arnold. They are on strike? 

Mrs. Decent. Yes, sir; so that is why we haven't moved out there. 

Mr. Arnold. You mean he isn't working now? 

Mrs. Decent. No; they have been on strike for a week now. 

Mr. OsMERs. What are they striking for? 

Mrs. Decent. Higher wages and a closed shop. 

Mr. OsMERs. He is paid 50 cents an hour now? 

Mrs. Decent. Yes. 

Mr. OsMERS. What are they asking for? 

Mrs. Decent. They are asking for 65 cents low. 

Mr. OsMERS. Is 50 cents low now? 

Mrs. Decent. Yes. 

Mr. OsMERS. And they want 65 cents? 

Mrs. Decent. Yes, sir. 

Mr. OsMERs. Thatis an increase of 30 percent? 

Mrs. Decent. Yes. 

Mr. Arnold. If they are out on strike very long that is going to 
make it a little difficult? 



NATIONAL DEFENSE MIGRATION 7113 

Mrs. Decent. Yes; it is. 

Mr. Arnold. You spoke about your husband having a brother 
there. Are his living quarters any different from yours? 

Mrs. Decent. Well, he has three brothers there. One is living in 
the Government apartments and then he has another one living out 
on Henry Street. Yes; they are much better than ours. 

Mr. Arnold. The Government apartments are pretty well fitted 
up? 

Mrs. Decent. Yes. 

Mr. Arnold. And do not cost much more in rent than you are 
paying? 

Mrs. Decent. No. 

Mr. Arnold. And that is what you would like to have? 

Mrs. Decent. Yes. 

Mr. Arnold. WTien this defense program is over do you plan on 
returning to Escanaba or on continuing to live in Muskegon? 

Mrs. Decent. We are planning on continuing to live in Muskegon. 
There isn't anything to return to Escanaba for. 

Mr. Arnold. You, like millions of other defense workers who have 
migrated, expect to contmue living on where you are, even though 
these defense orders will sometime soon after the war is over be 
curtailed? 

Mrs. Decent. Yes. 

Mr. Arnold. You have no other place to go; no plans except 
continuing to live at Muskegon? 

Mrs. Decent. Yes. 

The Chairman. In other words, Mrs. Decent, where your husband 
can get employment is where you want to live? 

Mrs. Decent. Yes. 

The Chairman. How many apartments are there in the building 
in which you are living? 

Mrs. Decent. Six. 

The Chairman. And you are paying about $22 a month for your 
apartment? 

Mrs. Decent. Yes. 

The Chairman. So the landlord is receiving for those six apart- 
ments, $125. Do you know what the rent was formerly in that place? 

Mrs. Decent. No. 

The Chairman. Has it gone up? 

Mrs. Decent. Well, I don't know. 

The Chairman. You say all these 25 people share the one bathtub. 
How do you arrange that? Do you draw straws for turns in the tub? 

Mrs. Decent. I wouldn't say. I don't use it. 

The Chairman. Do the children use it? 

Mrs. Decent. No; we have an old-fashioned tub. 

The Chairman. You wheel that out, do you, every Saturday night, 
as we used to? 

Mrs. Decent. Yes; that is about it. 

The Chairman. (To one of Mrs. Decent's two children.) What is 
your name? 

Bonnie Jean. Bonnie Jean. 

The Chairman. How old are you, Bonnie? 

Bonnie Jean. Eight. 

The Chairman. Do you go to school? 



7114 DETROIT HEARINGS 

Bonnie Jean. Yes, 

The Chairman. How far is the school from where you live? 

Bonnie Jean. I don't know. 

The Chairman. How many brothers have you? 

Bonnie Jean. Two. 

The Chairman. There are two girls and two boys in the family? 

Mrs. Decent. Three girls and two boys. 

The Chairman. And do they all go to school except the baby? 

Mrs. Decent. Only two of the children go to school. One little 
boy, age 2 years, is in the hospital at Marquette, Mich. He has been 
there 1 year. 

The Chairman. Well, you certainly have two lovely girls, Mrs. 
Decent. So you are satisfied to remain right where you are as long 
as your husband can secure employment? 

Mrs. Decent. Yes. 

The Chairman. Why can't you go into one of these Federal 
defense houses? 

Mrs. Decent. Well, we are living in a furnished apartment right 
now and we haven't got the money right now to have our furniture 
shipped from Escanaba or buy new furniture; and, of course, we 
don't want to do anything like that until we know how the work is 
going to turn out. 

Mr. Osmers. In answer to Congressman Arnold's question, Mrs. 
Decent, you said you had not been able to save any money on the 
job up there; is that right? 

Mrs. Decent. Yes. 

Mr. Osmers. May I ask you how you make out while the strike 
is going on, as to rent and food and other expenses? 

Mrs. Decent. Well, we have saved — my husband knew they were 
going on strike. He didn't know just when, but he knew they were, 
so we have saved what we could out of each week. 

Mr. Osmers. How long will that money last? 

Mrs. Decent. I don't know how long that will last. I imagine by 
the end of next week we will be up against it. 

Mr, Osmers. Does it look as if the strike is going to be settled? 

Mrs. Decent. Yes; they think it wUl be settled the end of this 
week. They have hopes it will be. 

Mr. Osmers. Do you think, from your standpoint, that it would 
have been better if the men had not gone out on strike and that some 
Government mediation agency would have mediated the proposition 
while they were still working? 

Mrs. Decent. Yes; I think it would have been much better. 

Mr. Osmers, Is the matter now before some Government media- 
tion body? 

Mrs. Decent. Yes; it is. 

Mr. Osmers. So, in other words, those men and their families are, 
in a way, going to be close to the starvation point, and yet it still 
has to be settled by a Government mediation body anyway? 

Mrs. Decent. Yes. 

Mr. Osmers. But in the meantime you are not receiving any 
income? 

Mrs. Decent. No. 

Mr. Osmers. What was your husband doing in Escanaba? 

Mrs. Decent. He was a cement mixer for the Superior Products. 



NATIONAL DEFENSE MIGRATION 7115 

Mr. OsMERS. And what does he do now in Muskegon? 
Mrs. Decent. Why, I think he drives rivets or something Hke that. 
The Chairman. Thank you very much, Mrs. Decent. We appre- 
ciate your coming here. Mr. Peppin is our next witness. 

TESTIMONY OF ALBERT PEPPIN, MUSKEGON, MICH. 

The Chairman. Mr. Peppin, Congressman Arnold will ask you a 
few questions. 

Mr. Arnold. Mr. Peppin, will you state your name and address 
and age for the committee? 

Mr. Peppin. Albert Peppin, 51 next birthday, the 20th of this 
month. 1900 Commerce Street, Muskegon. 

Mr. Arnold. Where were you born, Mr. Peppin? 

Mr. Peppin. Well, in the neighborhood of Ishpeming, Alich., in the 
Upper Peninsula of Michigan. 

Mr. Arnold. How long did you live there? 

Mr. Peppin. Well, until last March. That is when I came down 
to Muskegon. 

Mr. Arnold. What kind of work were you engaged in? 

Mr. Peppin. In the mming industry. 

Mr. Arnold. What kind of mines? 

Mr. Peppin. Iron-ore mines. 

Mr. Arnold. When did you start working there — at what age? 

Mr. Peppin. Eighteen years old. 

Mr. Arnold. Ever have any other kind of employment? 

Mr. Peppin. No. Practically followed the mining game all the 
way through except, well, from the u-on ore mines I went to gold 
mining for a while on a prospect up there. 

Mr. Arnold. Did you have a better job in that mine? 

Mr. Peppin. Yes; I did. 

Mr. Arnold. What was that job? 

Mr. Peppin. I was in charge. 

Mr. Arnold. You were the boss? 

Mr. Peppin. Yes, sir. 

Mr. Arnold. And what salary did you receive? 

Mr. Peppin. Well, the salary was kind of up and down at times. 
It depends on how the stock situation went, and whether they had 
any new prospects. I would say wages were around $40 a week. 

Mr. Arnold. When everything was going well you got $40 a week? 

Mr. Peppin. Yes. 

Mr. ARNaLD. That was better pay than you received in the iron 
ore industry? 

Mr. Peppin. Well, it was better in one way. I kind of hoped 
things would probably turn up to better wages in time, but the war 
came around, and the depression, and it hurt the stock and they had 
to shut down. 

Mr. Arnold. Are you married and do you have children? 

Mr. Peppin. Yes, sir; I have six children. 

The Chairman. Their ages? 

Mr. Peppin. One is 28. He is married and supports himself. One 
is 25, I think — something along that, 25 — yes, 25, she is married. I 
have one at home, 23, and one 21, and the girl 17, and the small boy 
of 9 years. 



7116 DETKOIT HEARINGS 

Mr. Arnold. How did you happen to come to Muskegon? 

Mr. Peppin. Well, where we live up there in the Upper Peninsula, 
it seemed there was no future for the young men that came out of liigh 
school. I had a boy, one bo}^, Theodore, worked for a dry cleaner. He 
has worked there for very small wages, but for a little expense money 
is why he worked. The other one couldn't get no work, so the oldest 
one came down here to Muskegon and he got work. 

At the time he told me if I come down there that there was a pros- 
pect to get a job and that the other boy might get in, too, and that is 
why we came to Muskegon. The young man has a better chance 
for employment. 

Mr. OsMERS. Is Muskegon a bigger town than the one you left? 

Mr. Peppin. It is about four times as large. 

Mr. Arnold. And the son you spoke of, who worked in the dry- 
cleaning establislmient, wasn't able because of asthma to work in the 
mine, according to the report of our staff. 

Mr. Peppin. Yes; that is right. 

Mr. Arnold. Has that mine work affected your health? 

Mr. Peppin. Not very much. 

Mr. Arnold. You could still "take it" as well as you could when 
you were 18? 

Mr. Peppin. Well, I wouldn't say for so long a period of time — like 
in a running race, I wouldn't do that — but I am able to take it for the 
age as well as anybody else. Didn't affect my health. 

Mr. Arnold. But if your family could have been a little better em- 
ployed in Ishpeming you probably w^ouldn't be a resident of Muske- 
gon now? 

Mr. Peppin. That is right. 

Mr. Arnold. When you came to Muskegon did you bring your 
family w^ith you? 

Mr. Peppin. No; they came in about 2 weeks. 

Mr. Arnold. And you had a son already employed there? 

Mr. Peppin. I had a son employed and the other one got work 3 
days after we got there, and I got work a week after. 

Mr. Arnold. You found a job without much trouble? 

Mr. Peppin. Yes. 

Mr. Arnold. Is it in a defense plant? 

Mr. Peppin. Well, it is a paper company there. They are not 
directly defense. I think it is indirect some way. 

Mr. OsMERS. What are they making, Mr. Peppin? 

Mr. Peppin. It is a big paper mill. 

Mr. OsMERS. What kincl of paper? 

Mr. Peppin. Well, they practically print — make a lot of varieties. 
I couldn't say — wrapping paper down to printing paper and such 
things as that. 

Mr. Arnold. What do you earn? 

Mr. Peppin. I am earning around $45 a week now. 

Mr. Arnold. Did Francis, your son, find work? 

Mr. Peppin. Yes. 

Mr. Arnold. Do you know whether the firm he is with is engaged 
in a defense effort? 

Mr. Peppin. Yes; it is the Fitzjohn Coach Co. 

Mr. Arnold. Then your wife and unmarried children are all living 
in Muskegon? 



NATIONAL DEFENSE MIGRATION 7117 

Mr. Peppin. Yes, sir; we are all living m Muskegon. 

Mr. Arnold. And the two married children are back in Ishpemmg? 

Mr. Peppin. Yes, sir; Francis, he is married now. He has a new 
house project — one of the new houses. 

Mr. Arnold. He is married and lives in a defense project house at 
Muskegon? 

Mr. Peppin. Yes. 

Mr. Arnold. Just recently married? 

Mr. Peppin. Last Satm-day. 

Mr. Arnold. So you might not be able to keep your family together 
after all? 

Mr. Peppin. No; we will try to keep them assembled in the same 
to^vn as much as possible. 

Mr. Arnold. In Ishpeming did you rent or did you own your own 
home? 

Mr. Peppin. I owned my home, 

Mr. Arnold. Do you still own it? 

Mr. Peppin. Yes. 

Mr. Arnold. You are renting it now? 

Mr. Peppin. Yes. 

Mr. Arnold. Do you like living in Muskegon well enough to think 
you are going to remain there? 

Mr. Peppin. Well, as long as the work is going to keep on going, I 
would like to live in Muskegon. 

Mr. Arnold. Do you think you like to live there well enough so 
that you will give up your home in Ishpeming? 

Mr. Peppin. Yes; I figure on selling it. 

Mr. Arnold. It is for sale now? 

Mr. Peppin. Yes. 

Mr. Arnold. How do you like living in Muskegon? 

Mr. Peppin. Pretty good — very good. 

Mr. Arnold. Are you satisfactorily located in a residence or apart- 
ment? 

Mr. Peppin. Yes — well, I have — it isn't mine yet, but I have se- 
cured a house and paying it on monthly payments at the start. 
T\Tien I rented it, I rented it for 3 months and if I want to buy it 
I can. 

Mr. OsMERS. You have a contract to buy the house? 

Mr. Peppin. Yes. 

Mr. OsMERS. What is the price of the house? 

Mr. Peppin. $3,800. 

Mr. Arnold. And is it a modern house? 

Mr. Peppin. A very modern house. 

Mr. Arnold. W>re you born in this country? 

Mr. Peppin. Yes, sir; I was born and raised in this country. 

Mr. Arnold. Were your parents born in this comitry? 

Mr. Peppin. My dad came from Canada when he was 12 years old 
and mother w^as very young. She was a very young girl when she 
came across, and always remained. She was raised in Champion, 
Mich., and that is just a little ways from Ishpeming and my dad was 
raised in Ishpeming. 

Mr. Arnold. Have you ever found it necessary during the depres- 
sion to ask for public assistance? 

Mr. Peppin. No, sir; we managed to wiggle through. 



7118 DETKOIT HEARINGS 

Mr. Arnold. The going was pretty hard sometimes? 

Mr. Peppin. It was kind of tough and that has happened at the 
time when the wages didn't come so regular at the gold mines and 
made it all the harder, but with the little we had ahead and our home, 
we managed to pull through very nicely. 

Mr. OsMERS. Mr. Chairman, the committee is greatly concerned 
with what is going to happen after this defense program is over. 

Now [to Mr. Peppin] you are making about $45 a week? 

Mr. Peppin. Yes. 

Mr. OsMERs. How does that compare with the wages you have 
earned all through your life? Is it higher than any you have ever 
earned? 

Mr. Peppin. No. The way it is now my wages are a little lower 
than what I did have in the Upper Peninsula. The overtime that 
I am putting in is bringing me my wages. 

Mr. OsMERS. I am sure the committee would be interested in 
knowing the answer to this question: If peace came into the world 
tomorrow, and defense work stopped shortly thereafter in the United 
States, what would you do? Would you stay in Muskegon or would 
you go back to Ishpeming? 

Mr. Peppin. Well, that would be a question that is kind of hard to 
answer. I can't say sure what I would do. If I can get work in one 
place I would go back to Ishpeming. If I couldn't get work in 
Muskegon I would go back to Ishpeming and secure work probably 
from the old company for myself. I don't say the boys could probably 
get in. 

Mr. OsMERS. It would probably break up the family? 

Mr. Peppin. Yes, sir. 

Mr. OsMERs. One of the boys might go to Illinois, looking for work, 
and you might go back to Ishpeming, and one might stay in Muskegon, 
but it would start the family on the move, wouldn't it, because there 
wouldn't be enough jobs in Muskegon? 

Mr. Peppin. That is right, because the people have been coming to 
Muskegon pretty strong, and like you say, if the defense work stops 
all at once, it would be pretty crowded with unemployment, so some 
of the older hands would stay while some of the new hands would have 
to go around to get a job. 

Mr. OsMERS. You have mentioned the fact that a lot of people 
have come into Muskegon recently during this defense boom. Where 
have they come from, in the main? Are they Michigan people or 
from out of the State? 

Mr. Peppin. Well, I don't know. Not Michigan, altogether. 
There are licenses from Illinois and from Indiana, at our plant down 
there. 

Mr. OsMERS. Do you have any idea what those men were doing 
in their home States? 

Mr. Peppin. No; I don't. 

Mr. OsMERS. They were attracted there just as you were? 

Mr. Peppin. Yes, sir. 

Mr. OsMERS. You heard there was employment? 

Mr. Peppin. Yes, sir. The way I was attracted there most, I had 
a friend that has been there 10 years that I lived neighbor to, and he 
has made good going of it with the family that he had to put up with, 



NATIONAL DEFENSE MIGRATION 7119 

and that is why I went there too. It was for the young people to 
get jobs. 

Mr. Arnold. I take if from your testimony, Mr. Peppin, that no 
matter what small wage you make, you try to lay away a little of it? 

Mr. Peppin. We do. 

Mr. Arnold. And you are planning on doing that now^? 

Mr. Peppin. Yes. 

Mr. Arnold. And you will do it either in the form of a house that 
you are buying, or maybe if you can save up a little over and above 
that you will do so? 

Mr. Peppin. That is what our plans have always been. We have 
been married a long time and we have alwaj^s tried to save a little 
money. That is one thing we always did. We always have some- 
thing ahead for the next day. 

Mr. Arnold. ^Vhat we are concerned about is that so many in 
this Nation, no matter what they are making — and that includes 
Congressmen as well as anyone else — don't lay up a penny. No 
matter what they do, they just don't think of the future. We are glad 
to find one witness who is really thinking ahead to the day when this 
defense effort may tlirow him out of a job and he will have to read- 
just his life to the new" economy. 

Mr. Peppin. That is what I have been preaching to lots of them. 
I know w^e have been talking about these matters and I have heard 
different points of view, and I always said anj^body who is making 
fair wages now ought to pin some down because things might come 
when it will be necessary to have a little on hand. 

The Chairman. Mr. Peppin, have you purchased any bonds, or 
do you intend to? 

Mr. Peppin. We intend to. Of course, w^e bought a house and we 
are trying to do a little bit on that too. 

The Chairman. Mr. Peppin, I think you and my colleagues have 
covered your situation very w^ell, and we thank you very kindly for 
coming here and testifying. 

Air. Peppin. Well, you are welcome. 

The Chairman. Our next witnessess will be Mr. Lovett, Mr. Hall, 
and Mr. Calm. 

TESTIMONY OF JOHN LOVETT, GENERAL MANAGER, MICHIGAN 
MANUFACTURERS ASSOCIATION; WILLIS HALL, MANAGER, IN- 
DUSTRIAL DEPARTMENT, DETROIT BOARD OF COMMERCE; 
AND CHESTER A. CAHN, SECRETARY, AUTOMOTIVE TOOL AND 
DIE MANUFACTURERS, DETROIT, MICH. 

Gentlemen, Congressman Osmers will ask you the questions. 

Mr. Osmers. Will you please identify 5'ourselves? 

Mr. Lovett. John Lovett, general manager, Michigan Manu- 
facturers Association. 

Mr. Hall. Willis Hall, head of industrial department, Detroit 
Board of Commerce. 

Mr. Cahn. Chester A. Calm, secretary, Automotive Tool and Die 
Manufacturers. 

60396 — 41 — pt. 18 5 



7120 DETROIT HEARINGS 

COMPOSITION OF MICHIGAN MANUFACTURERS ASSOCIATION 

Mr. OsMERS. Mr. Lovett, how many firms does your association 
represent? 

Mr. Lovett. About 1,600. 

Mr. OsMERS. Are they scattered all over the State of Michigan? 

Mr. Lovett. All over the State. 

Mr. OsMERS. Have you made any charts showing how they are 
distributed among the small, medium, and large manufacturers? 

Mr. Lovett. No; I haven't. 

Mr. OsMERS. Well, let me rephrase that. Is your organization made 
up of all sizes of industrial units? 

Mr. Lovett. All sizes, from employers of probably 15 on up. 

Mr. OsMERS. Employers of about 15. Would that be the mini- 
mum? 

Mr. Lovett. That is right. 

Mr. Osmers. On up to the largest? 

Mr, Lovett. Ford Motor Co., and Chrysler, and so forth. 

Mr. OsMERS. Mr. Lovett, your paper will be entered as a part of 
the record, 

(The paper referred to above is as follows:) 

STATEMENT BY JOHN L. LOVETT, GENERAL MANAGER, MICHIGAN 

MANUFACTURERS ASSOCIATION 

Michigan needs primary defense contracts. An increase of 100 percent in the 
contracts now let here would still leave some capacity. 

Michigan is primarily a subcontracting State. Most all of those producers of 
finished products, in one way or another, obtain parts from subcontractors. The 
hope of aiding tlie small manufacturer lies in getting the large manufacturer enough 
business so that he can subcontract it. 

That is also the answer to our labor problems. It appears, from reports received 
by the Michigan Manufacturers Association, that early in January Michigan 
faces an unemployment of 115,000 workers. This includes automotive and non- 
automotive industries. 

Priorities still are confusing, slow in coming through and interfering in some 
cases, causine lay-offs among manufacturers who have defense contracts. I rec- 
ommend that the survey which the Supply Priorities and Allocation Board seems 
to have undertaken to find out how much materiel the various defense arms have 
on hand, be speeded up, that the ability of American industry to fabricate raw 
materials for the next 6 months be arrived at, and that then the producers of 
basic materials be allowed to distribute their surplus over defense requirements to 
civilian uses. 

The migration of labor has not become a problem in Michigan as yet. There 
has been some migration from small cities in rural sections to larger industrial 
centers. There has been some influx of labor to Detroit and a fcw^ other centers 
from southern States but, generally speaking, the migration of labor at the 
present time is relatively unimportant. 

But what it will be next January, when the full impact of the curtailment of 
autom.obile production, and the full impact of priorities upon nonessential industry 
takes effect, I cannot sav. It is probable that there will not be great migration 
of labor for the reason that the same impact that hits Michigan will hit generally 
throughout the industrial States of the Union. 

IMPORTANCE OF SPEED IN LETTINH PRIME CONTRACTS 

Michigan's lal)or problem., therefore, comes back to my opening statement, 
that of prime contracts. 

Prime contracts, if thev are to be of value to prevent unemployment and to 
prevent the imj^act of priorities on nonessential industries, should be let imme- 
diately. It takes time for any manufacturer to tool up to do any kind of defense 



NATIONAL DEFENSE MIGRATION 7121 

job. Unquestionably, most Michigan industries coukl get read}' to get into pro- 
duction on any defense items by the end of January. It has been our experience 
that the War Departm.ent is slow in awarding contracts. Billions have been 
appropriated which have not yet been contracted for. The Army appears to be 
afraid to freeze its designs. It takes too long from the tune a letter of intention 
is issued by the Office of Production Management until the manufacturer gets 
working blueprints to use his labor and his facilities. 

The system of bidding prevailing in the War Departm.ent and the Navy Depart- 
ment works a still greater hardship upon States like Michigan which pay high 
wages. Obviously, territories which pay lower wages are going to underbid 
Michigan manufacturers. We have lost"^ several contracts on that basis. The 
Army Ordnance Bureau suggested at one time that the Nation be zoned into areas 
of like wages and that bids be taken from these various zones. 

I am informed that this proposal was vetoed by the Attorney General who held 
that the contracts must go to the lovscst bidders. Many firms in Michigan 
have been designated by the Army Ordnance as prime contractors and had been 
given educational orders. These firms had tooled up and had the tools on hand to 
make the defense product which the Army Ordnance had planned, but when the 
bids were taken, it was found that in many cases the contract went to a manu- 
facturer in some other State who had not had an educational order, who had no 
knowledge and no tools, but whose wage rates were from 30 to 40 cents an hour 
lower than those of the Michigan manufacturers. 

Obviously, it was necessary for this uneducated manufacturer to tool up his 
shop and get the experience which had already been gained by the Michigan 
manufacturer through the educational order. Undoubtedly, this procedure ha& 
delayed the production of defense material throughout the whole program. 

UNUSED PRODUCTION FACILITIES IN MICHIGAN 

There are plenty of unused facilities in Michigan for tlie pioduction of any 
items used in the defense program. Generally speaking, Michigan is a mass pro- 
duction State. It is a State where its manufacturers and workers are skilled in 
repetitive operations. That is the kind of prime contracts we want. 

The automotive manufacturers have, from the very beginning of the industry, 
utilized subcontractors. I am advised that the Chyrsler Corporation has around 
700 subcontractors on the medimii tank contract that it is now producing, and I 
an advised that the Clirysler Corporation regularly in the production of automo- 
biles buys from about fourteen or fifteen hundred suppliers. 

I am also advised that the Ford Motor Co. buys materials from approximately 
seven thousand suppliers: and that the General Motors Corporation and others 
of the automobile companies utilize suppliers for a considerable percentage of 
their finished products. 

Therefore, it seems to me that one important solution of Michigan's difficulty 
lies in utilizing the facilities of the larger manufacturers who, of course, will spread 
their orders to subcontractors. It is easier for a sma,ll manuf?.cturer to work 
witli a prima contractor in his territory than it is for liim to take a part of a 
Government contract directly from the Government. In the first place, the prime 
contractor has an engineering staff and the facilities for showing the small manu- 
facturer how to make the product. He can give assistance that, if the small 
manufacturer had to hire it or buy it, would make his prices out of line with what 
the product could be obtained for on bids. 

The prime contractor will assist the smp.ll manufacturer in changing over his 
machinery, and the prime contractor may have certain machines that can fit into 
the process to complete an operation started by the small manufacturer. 

CONVERSION OP SMALL FACTORIES IN LAST WAR 

In the last war, the Government experienced a great deal of dissatisfaction in 
attempting to convert small factories. The most successful combination was the 
employment of tlie facilities of the small factories in conjunction with the large 
contractors. In procurement, too, the small manufacturers would have the assist- 
ance of the buyers for the nrime contractors. 

On the other hand, tliere are certain small industries in Michigan that have 
equipment and the skill to complete a contract but it is expensive, in most cases 
too expensive, for thesj firms to have representation in Washington. The Defense 
Contract Service was designed to bring the Government orders close to the manu- 
facturer. My reaction is that, through no fault of the Defense Contract Service, 
the Government iirocuremant divisions would not let anything but the "cats and 



7122 DETROIT HEARINGS 

dogs," get into the liands of the Defense Contract Service. In looking over the 
offerings of the Defense Contract Service, in a very cursory way, my conchision 
is that many of tlicso things were difficult to obtain in Washingtovi, or the speci- 
fications were so uncertain that it was not easy to place a bid fcr the product. 
Obviously, the policy of decentralizing procurement of defense items has failed 
miserably up to date. 

Of course, hundreds of tliousands of small manufacturers throughout the United 
States cannot be represented directly in Washington. It, therefore, seems that 
the easiest solution of the troubles of the small manufacturer lies in seeing that 
the larger manufacturers liave enough business to take uj) the facilities of the 
small manufacturer. 

ESTIMATES 115,000 UNEMPLOYED IN JANTJARY 1942 

I have estimated that 115,000 men ^\'ill be unemployed in Michigan in January. 
I base this on reports to me from the local chambers of commerce of the industrial 
cities of Michigan. Their estimates appear to be based upon what will progres- 
sively happen if their industries run out of materials and, further, upon the studies 
that have been made of industry bj^ the Michigan' Unemployment Compensation 
Commission. The problem of labor and its employment in the defense industries 
is one requiring study and considerable experimentation. The manufacture of 
defense items is, generally speaking, a i:)recision job. The production of aircraft 
engines and instruments is a highly skilled occupation. There are large numbers 
of v.'orkers in Michigan industries who have been what we call semiskilled work- 
ers. The}^ operate machines which have been set up and which are maintained 
by other men. Other men are emploj-ed upon assembly lines. Training pro- 
grams can he used to retrain the younger employees for defense work. My con- 
cern is with those men who have spent many years in these industries and who 
have reached the age where it is difficult for them to undertake to learn precision 
work. These are the men with seniority and will be the men, of course, last laid 
off in the motorcar industry. But whether they can be utilized in the defense 
industry is still a matter to be determined. 

The big demand, if Michigan facilities are utilized to anywhere near capacity, 
will be for a large number of highly skilled workers. These men are not immedi- 
ately available, and the big shortage in tlie United States, as well as Michigan, 
when and if the industrial facilities of the Nation are utilized, will be for highly 
skilled workers. Michigan has a number of training programs in operation, both 
in industry and in the schools. 

I am attaching herewith excerpts from reports made to me by executives of 
different chambers of commerce in Michigan on what the situation is in their 
communities. I might say that these reports are in reply to a letter prepared 
by Mr. John W. Abbott of your committee's staff, as to information desired by 
your committee for these hearings. I think they are fairly accurate pictures of 
the conditions in the cities from which they are received. In some cases the 
report covers the county as well as the city. 



("The material referred to above is as follows:) 

Exhibit A. — Excerpts From Reports of Michigan Chamber of Commerce 



Midland is the home of the Dow Chemical Co., the largest employer in this 
district. Over 80 percent of the labor is unskilled and the supply has been suffi- 
cient in Midland and the surrounding area. (This may not be true at the Dow- 
metal Foundry in Bay City.) The Austin Co., a construction firm erecting a 
chemical warfare plant for the Government at Dow, find it difficult to secure 
skilled labor and have brought in people from all over the country. 

This influx of people is this defense area has created a housing problem that is 
not alleviated by the establishment of a homes registration office at the chamber 
of commerce. Considerable private building continues but it is inadequate. 

There are several smaller concerns, such as the Roland P. Place Manufactur- 
ing Co. making plastics, and the Midland Macliine & Manufacturing Co. I have 
•contacted both and neither seemed undulj' concerned over lack of materials, etc. 
The latter concern at the present time is working on about 95 percent defense 



NATIONAL DEFENSE MIGRATION 



7123 



orders for the Austin Co. and the Dow Chemical Co. They are not at full ca- 
pacity but have a subcontract in view which will bring them up to full production. 
The picture in Midland doesn't seem to be a bad one. With Dow, considered 
as the number 1 defense plant of the country, the largest manufacturer and ac- 
counting for employment of between 4,000 and 5,000 people in a city of approxi- 
mately 11,000, there shouldn't be much unemployment in the immediate future. 

BAY CITY 

Insofar as can be determined, based on announcements made to date, the total 
of primary contracts for national defense work here is estimated at $25,000,000. 
Since figures are seldom disclosed on secondary contracts, we do not know what 
these would amount to locally; although it is possible they might range from 
$5,000,000 to $10,000,000. 

The employment statistics you requested follow (these are actual figures re- 
ported to us by all local plants employing 10 or more people) : 





1937 


1938 


1939 


1940 


1941 




7,147 
8,662 
7,738 
7,849 
7,900 
8,226 
8,871 
8,897 
9,588 
9,266 
8,539 
6,292 


5,225 
5,202 
5,073 
4,998 
5,121 
5,742 
5,719 
5,259 
6,142 
7,891 
8,187 
7,723 


7,541 
7,173 
7,205 
7,007 
7,403 
7,094 
5,909 
6,154 
8,045 
8,281 
7,898 
7,956 


7,639 
8,657 
7,708 
7,081 
7,171 
7,415 
6,185 
7,558 
8,699 
9,384 
9,681 
9,467 


8.957 




9,232 




9,518 




9,601 




9.575 




9,882 


July 


10, 105 




9,668 























As of September 1, there were only 79 families on direct relief in Bay City. 
Nothing could better reflect the policy of Bay City manufacturers of hiring local 
labor. . ,, , c 

Local manufacturers have not yet found it necessary to import large numbers ot 
skilled, semiskilled, and unskilled factory workers. They have, however, m 
certain instances, found it necessary to draw on the rural areas of the "thumb" 
district and northern Michigan for employees. Many, if not most, of these 
employees live within a radius of Bay City, which makes it possible for them to 
drive iDack and forth to work. 

For the most part, Bay City is a metal industries town. 

Wherever they find it necessary to do so, plant operators are sponsoring 
"training within industry" programs. 

It is estimated that 400 new houses will be either started or completed in the 
Bav City area this vear. 

Although Bay City's housing situation is considered tight, it is by no means 
desperate; and unless future months bring a much greater influx of defense workers 
than we have had to date, it is thought improbable that there will be a need for con- 
struction of so-called Government housing units. This chamber is, however, 
attempting to encourage more and more privately sponsored residential construc- 
tion, in an effort to improve the quality and quantity of lower- and medium-cost 
housing. (Our vacancv ratio, according to a Work Projects Administration sur- 
vev reported March 17," 1941, was 1.5 percent, of which 0.7 percent was considered 
habitable. For details see Work Projects Administration survey No. A2274.) 

YPSILANTI 

So far we haven't been hurt, but we are plenty scared. Our two largest plants, 
the Central Specialty Co. and the United Stove Co., have not as yet been able to 
get anv defense business and because of the shortage of materials are going to be in 
trouble verv soon. These plants employ 1,600 men; practically every ^other plant 
in town is going to be similarly affected. Our manufacturers feel fairly sure of 
their supplies up to December 1, if nothing goes wrong in the meantime. Beyond 
that it is pretty much of a blank wall. 

We do have some defense business, but it is negligible from the standpoint of 
keeping men at work, and, of course, you know that the bomber-plant operation 
is not going to absorb many men for months to come. They hope to be in full 
production by next June. 



7124 DETROIT HE.VIIINGS 

The interesting angle to all this is that our men are working hard to get defense 
business. In fact, we are one of the few towns in the whole country where we have 
established a pool and where our manufacturers are willing to take business which 
two or more of them might handle jointly. They have enaged a William Paxton, 
of Detroit, to represent them with all Government jjurchasing agencies. 

Our set-up, including a complete inventory of all our equipment, has gone to 
all big prime contractors, Government departments, and Office of Production 
Management officials who have to do with the distribution of Government orders. 
Through this consolidation of manufacturers our fellows are spending real money, 
time, and effort to get business. They have been doing this for 2 months because 
of the realization that their nondefense business was being threatened and they 
would have to have defense business to keep their plants running. They have 
been anything but asleep, but as yet have been unable to get any substantial 
amount of business. 

We are going to point out some of the unbelievable experiences that our little 
group is having in submitting bids. For instance, one of our manufacturers was 
second low on an order of materials. His bid was $76,000 and the low bid was 
$24,000. Yesterday at our regular weekly meeting when we were going over 
specifications and blue prints as we do each Thursday noon, we learned that the 
low bidder down in Georgia got the business. Our manufacturer figured that 
they couldn't even furnish the material for $24,000. We just couldn't figure 
that one out. 

MANISTIQUE 

The situation, as far as local manufacturers is concerned, is beginning to be 
quite serious. 

Our industries here are mostly wood products and stone. They have little or 
no trouble in securing their primary raw materials, but they are definitely delayed 
in securing repair parts and machinery. 

The Manistique Pulp & Paper Co. is having trouble with priority in regard 
to the purchase of screens, electrical motors, and repair parts, and, if some im- 
provement is not made in the near future, it may be necessary for this plant to 
shut down. 

KALAMAZOO 

We get from our power company the record of meter settings diie to new 
families coming here and meter take-outs due to families moving from here. 
This data does not cover apartments but it can be presumed that they will run 
parallel to individual homes. The new meter settings from January 1 were 465 
and the take outs were 350. I haven't taken the trouble to count up a year like 
1937, but from our office familiarity, I would say that the above figures are just 
about like they were in 1937. There has been no bulk migration of labor into 
Kalamazoo or out of Kalamazoo. 

Now as to defense employment unemployment. Late in July I canvassed all 
of the nonpaper companies in town that I suspected might have a chance of having 
any defense business. I asked for portion of man-hours allocated to primary or 
subcontracts, total employment in Julv, and total employment the year previous. 
The summary of this canvass is that there were 20 firms that had from a little to 
quite a bit of defense business; that they had 1,800 employees, or the equivalent 
thereof, on defense; that 800 of these represented increase of employment and 
1,200 made over from civil to defense; and the total amount of labor in this city, 
industrially, is somewhere 10 to 12 percent on defense. However, this does not 
take into account the offsets in nondefense industries showing a decline and with 
severe declines apparently threatened. The all-over condition is, for the moment, 
that our city's business activity compares with what it might be in anv good 
business year. That is, if national business conditions were good regardless of 
defense, we would be as we are now without any help from defense locally. 

The figures on awards of primarv contracts to Michigan cities show that we are 
the lowest industrial citv in the State with primary contract awards equivalent 
to about $6 per capita considering our metropolitan area. We only have about a 
half a dozen firms who are sufficiently well anchored with banks of good machine 
tools capable of close tolerances to have much chance at defense contracts. I 
don't believe that their activity can overcome the shrinkage in industries not 
equipped sufficiently witlf the right machine tools. 

To prophesy what the unemployment will be if priorities are severely enforced 
against nondefense industries, is hard guessing. But, for instance, if home- 
heating units are not to be built, there will be about 1,300 men laid off, most of 



NATIONAL DEFENaii MIGRATION 7125 

them skilled. If water- and-gas heater units are cut to 50 percent, 175 men wiU 
be laid off. Then add 100 percent to these figures for the lay-off of branch sales- 
men throughout the several States. There are a whole lot of small shops and 
service and retail establishments that are certainly due to be affected but I don't 
know how to count up the result on a volume basis. 

As to housing — our housing is all full but this year and for several years we have 
had a fine program of home building on the individual basis and it has just about 
kept up with its job. A larger program of housing may be needed but I don't 
think so, not with the threat of imemployment in the nondefense industries and 
the extremely high income taxes that are going to make some people owning homes 
on a shoestring throw up their contracts. 

For the time being, the administration is pursuing a program of throwing 
nondefense out the window. Likely, that will go on for about 6 months until the 
pressure of labor, namely union labor, sets up a howl that convinces the administra- 
tion that it had better get on the big side again and then it will level off to some- 
thing reasonable. But meantime, we will have had a nice mess in which the 
theorists have had a good time. 

GRAND RAPIDS 

Returns from Grand Rapids manufacturing firms, numbering 74, received in 
response to a form questionnaire mailed by the Grand Rapids Association of 
Commerce, reveal the following facts: 

1. That of the 74 firms reporting (including 41 metalworking, 17 woodworking 
and furniture manufacturing, and 16 miscellaneous firms) 44 firms sought national- 
defense contracts and of these 44, a total of 17 firms were awarded prime contracts 
totaling $9,661,750 and 20 firms were given subcontracts amounting to $4,315,570; 
a total of $13,877,320 in prime and subcontracts. 

2. That employment in these 74 firms now is 15,545 hands, compared with 14,917 
as of last January 1. 

3. That there "are shortages of many materials now handicapping these firms, 
ranging from a small percentage to 100 percent. 

4^ That while probably less than 700 men have been laid off to date, due to lack 
of materials, over 3,300 are threatened with loss of employment within the next 
30 to 60 davs, due to this cause. 

Following is a break-down of study of the reports of the 74 firms by classification: 

Metalworking. — Employment: 11,082 currently compared with 10,946 on 
January 1. Number of these firms seeking defense contracts, 29. Total value of 
12 prime contracts received, $9,538,250. Some firms are just starting on these 
contracts; others have completed them or are in various stages of completion. 
Total value of 18 subcontracts received, $4,215,070. Plant facilities engaged by 
21 metal firms reporting average about 47 percent (for defense contracts) and 
range from 1 percent to 100 percent. 

Thirty-one metal industries reported material lacks ranging from small percent- 
age to 100 percent (as in case of aluminum). Materials in which there are short- 
ages are: Steel, toluol, ethyl acetate, linter cotton, manganese briquets, nickel 
anodes, rod, tube, and sheet steel, strip and bar steel, galvanized mesh, alloys, 
pig iron, bronze, saw steel, brass, bronze, rubber, cadmium, ball bearings, rolled 
shapes, heater controls, steel billets, carbon steel, tool steel, zinc, wire-bound boxes, 
iron castings, nickel chloride, copper sulphate, hardware, locks, chair irons, ma- 
carta schutes, chrome, tungsten, vent fans, and exhaust fans. 

No unemplovment was noted in 32 plants reporting. One plant (Jarvis Co.) 
stated "several hundred (laid ofi^) in 2 to 4 months." That company has no 
defense orders. Another reported 50 percent of force laid off, but this figure is 
not clear as company also reports 1,100 now employed compared with 1,400 of 
last Januarv 1 (Winters & Crampton Corporation). 

About 3,i00 anticipated lay-offs in next 30 days or 3 months. 

Woodworking and furniture. — Seventeen woodworking and furniture manufac- 
turing plants reported 1,291 employees at present, compared with 1,169 last 
Januarv 1. Seven sought defense contracts, but only 1 received any and that for 
onlv $1,.500 (Wadell Mfg. Co.). 

No unemployment is reported to date and only shortage of material is a 30- 
percent lumber shortage reported by one company (G. R. Dinette Co.). 

No definite statements were made as to anticipated unemployment. 

Miscellaneous manufacturers.— Sixteen miscellaneous manufacturers reported 
employment of 3,172 persons now compared with 2,802 as of January 1. Eight 
of these firms sought defense contracts. Total direct contracts received (by 4 
firms), $366,800. Total subcontracts (by 2 firms), $100,000. Note: One large 



7126 DETROIT HEARINGS 

company (Corduroy Rubber) reports that 10 percent of its business is on subcon- 
tract work; it does not state dollar volume of these subcontracts. Outside of that 
company, only a small percentage of facilities of these firms used in defense 
production. 

One large company (Globe Knitting Works) reported its silk supply only 5 per- 
cent of normal production. Other shortages reported were for board, castor oil, 
methanol, alcohol, lacquer solvents, acetone, albone, resins, and chemicals, per- 
centages running as high as 100 percent in cases of methanol, resins, and acetone. 

Reports on current unemployment vague; one firm reported 75 laid off for 2 
weeks; another said "some laid off during August." 

In the matter of anticipated unemployment Corduroy Rubber, employing 698 
on January 1 and 659 to date, anticipated 200 hands lay-oflf in November and 
December; G. R. Varnish Corporation employing 136 on January 1, and 160 at 
present, stated 10 percent lay-off anticipated. Others stated they were unable to 
guess. 

ALPENA 

We wish it were possible to contribute something to the hearing, but at present 
most of our local industries are "prettj' well set." 

You know the Alpena picture, and, of course, are aware of the fact the bulk of 
our industry is centered in the limestone and cement brackets. With one possible 
exception, all of our other plants have been able to pick up subcontracts wherein 
the prime contractor is seeing to it that he obtains the materials needed. 

We anticipate a day, not too far in the future, when our situation will be more 
acute than at the present time. Right now, the only situation we have at present 
from the local standpoint has to do with a small foundry whose principal trouble 
is financing rather than the lack of work. 

SAULT STE. MARIE 

The only one in our district is the Rudyard Block & T03' Factory. I under- 
stand that they are not able to secure steel disks and therefore will not be able 
to continue operation. They do have a lot of orders and this will really be a 
disaster to Rudyard as it is the only jjlant they have. 



It appears that, as yet, none of our industries has suffered to any marked 
degree for want of material needed in their manufacture. There has been and 
still is some delay, and it is anticipated that the condition will probably be more 
pronounced in the near future. The seriousness of this is well appreciated by 
all. However, no definite remedy has been presented. 



We estimate a total of 1,000 employees will be required on contracts now 
awarded when new plants and additions are completed and equipped, but we 
also estimate that curtailment of passenger-car production will lay off at least 
2,000 present employees. 

There has been no migration in this vicinity except in the beet fields. Lack 
of priorities has already reduced emplojanent in some of our woodworking plants, 
particularly among trailer manufacturers. 



Inasmuch as only three industries in Owosso have any defense contracts, it is 
estimated that a good manjf of our factories wiU be in a verj' serious position the 
first of the j^ear. 

Our largest industry, the Owosso Metal Industries, is now doing some sub- 
contracts and is going after other orders. However, they have informed us that 
if they are not given more defense work, they will be forced to shut down Jan- 
uary 1. This will throw approximately 2,000 employees out of work, or half of 
our entire industrial pay roll. 

We only have one industry here, the H. L. Hartley Machine Co., which is 
doing any appreciable amount of defense work and we don't believe that they 
wiU be affected. However, the rest of the list are in the same position as the 
Owosso Metal Industries. 



NATIONAL DEFENSE MIGRATION 7127 

ST. JOSEPH 

The following information which is not detailed, reflects our situation. 

To begin with, St. Joseph has a hosiery-knitting mill which has now laid off 
about 50 percent on account of the fact that their stock of silk (which was pre- 
sumed to be enough to last a full year) has been frozen by Government order. 
Thing)!! look dark indeed in this spot. 

We have a large washing machine manufacturing establishment which is very 
near to that time when they will be obliged to curtail and add to the unemploy- 
ment Vjecause of priorities on aluminum, steel, rubber, etc. 

Many of our other smaller industries, one in point, a manufacturer of sheet- 
metal signs, find themselves in a bad way on obtaining steel. 

The picture is very discouraging. Recently one of the labor organizations of 
the city has gone on record against these shut-downs and the thing which is causing 
them and is endeavoring at this time to secure cooperation from all interested 
parties. 

SEBEWAING 

As you no doubt are aware, we are located in an area which is primarily con- 
cerned with agricultural problems; however, we find that everyone is more or less 
concerned with the present state of affairs as it refers to priorities. The merchant 
finds ever increasing difficulty in obtaining merchandise due to the priority 
limitations; the service man serving farm equipment encounters difficulties also. 
I have in mind a shop doing extensive business in repairing farm equipment. 
The operator advises that he is having difficulty in obtaining metals for wielding 
due to the fact that his work is not of a defense nature, however essential to 
agricultural production. We have an industry which for the past 6 months has 
been encountering tremendous difficulty in getting the die work and materials to 
facilitate their starting production on electrical connections primarily in use for 
autos and aircraft. The manager has advised me that he has been unable to 
accept any orders for their product because of the fact he is unable to get this 
material and unless concerns of this kind are given an opportunity to complete 
their tooling they will be obliged to fold up and discontinue business. We had 
placed great hopes in this venture for it meant the employment of upward of 
.50 or 100 people. The equipment which they have already installed would make 
them ideal for defense work if they were allowed to get under way. 

This exemplifies the hardships placed on the Michigan manufacturers which 
we believe is entirely unnecessary and which as a whole will react unfavorably 
on the defense set-up. 

We have a tool and die plant here, the manager and owner of which advises 
that they are booked up with defense orders for the next 6 or 8 months to ca- 
pacity. He is operating under priorities of the highest type, manufacturing tools 
and dies for airplane parts. He advises that even though he has priority num- 
bers, his production is being held up from 6 to 8 weeks due to the lack of materials 
which he has been assured receiving under his priority numbers. It seems to 
me that a case of this kind should require urgent attention that when a manu- 
facturer enters into a 'proposition 100 percent devoting his entire production to 
defense work he should be entitled to the cooperation of the Priority Board and 
given every possible assistance in obtaining the material desired. 



Ionia Desk Co.: About 85 percent of their business is priority business and 
they plan a 50-percent increase; no shortage of materials as yet and no labor 
shortage. 

Ypsilanti Reed Furniture Co.: About 40 percent of their business is on defense 
contracts; no material trouble except obtaining shipping paper; no shortage of 
labor. 

Other Ionia industrials are not on defense contracts, only commercial and have 
no labor shortage. 

Belding Foundry Co. — Some material hard to obtain; zlso a scarcity of trained 
mechanics; some have moved to defense work cities. 

Metal Glass Products Co. (Belding) : Commercial business will last but a month 
or two; have created a defense department and have some direct contracts and 
some subcontracts. 

Extruded Metal Co. (Belding): On defense work 24 hours a day and 6 days a 
week because of brass and aluminum priorities; no labor shortage. 



7128 DETROIT HEARINGS 

Lake Odessa Tool & Die Co.: Have no priority number as yet; have had some 
subcontract work making dies for gas masks. Skilled labor hard to get. 



Although our industrial activities are somewhat limited we are very much 
aware of the problem and anxious that steps be taken to hel]) the situation. 

The Martin Loomis Machire Shop and the Northern Machine Shop are really 
the only two Clare concerns using a considerable amount of metal and are there- 
fore experiencing the greatest difficulty. 

In the case of the Loomis shop, some defense work has been obtainea through 
another concern which means that they cannot use a priority number and cannot 
obtain necessary material for their work which includes a considerable amount 
in connection with thv oil producing companies operating in this area. Their work 
which is therefore important in national defense in that the industry which they 
serve is important, is hindered through lack of materials. 

The Northern Machine Shop services farm machinery of all kinds and manu- 
factures a road leveler. The first service will become increasingly important as it 
becomes more difficult to replace farm machinery. This concern is having real 
difficulty in obtaining materials. 

We fully understand the necessity of diverting a great quantitv of materials for 
defense work but believe that it is equally importent to assure that industries who 
do not have priorities or defense contracts should be helped in some way to be 
able to continue in operation. 

JACKSON 

Regarding the amount of primary defense contracts and subcontracts in Jack- 
son. We made a survey a short i^ime ago and found there was approximately 
$22,000,000 Avorth of defense work in Jackson. There are a few companies 
practically 100 percent in defense work. Th^se include Hayes Industries, 
Kelsey Hayes Co., Lefers Forge & Machine Co., Jackson Motorshaft, Jackson 
Bumber Division. 

Estimates from local manufacturers in Jackson show that the increase in 
employment resulting from defense program is from 50 to CO percent. As near as 
I can learn, there has been very little migration of labor eithei- into or from Jackson 
because of publicity in the papers regarding defense contracts. We have of course, 
receive some increase in population which includes Army inspectors, special 
engineering personnel and some foreign labor and a few skilled mr'chanics from 
the smaller surounding to-^ns. I also might add we have lost a few of our skilled 
mechanics to Detroit, Pontiac, and Lanshig defense work. 

Regarding the effect of priorities in Jackson, practically all of our plants have 
been able to obtain material thus far. Some of our smaller plants ha.ve been 
pinched in trying to obtain piiority extensions but as a whole material shortages 
have a,ffected the production in Jackson very little. 

I feci I would be safe in saying that few would move out of Jackson if they were 
dislocated from the automobile industry, as manj' own their own homes here. 
There are fewer psople on the un?mployment lists now than in some j^ears and, as a 
whole, I would sav defense work has been an improvement for business conditions. 



What the automobile production curtailment will mean to Pontiac plants. 

American P'orge & Socket Co. (Mr. Hawke): "It will hit us very hard." This 
cut would mean a 99 percent curtailment in production. About 5 percent of 
their men are skilled workers, that would be about all that would be able to work 
on defense work without training. They are trying to get defense contracts but 
are not having much success. Present defense contracts are subcontracts for 
seatbacks for Army trucks for Chrysler Corporation. Present employment 209. 

Baldwin Rubber Co. (Mr. Shephard): Their employment would follow pro- 
duction cut almost exactly. If production was cut 20 percent their employment 
would fall off about 20 percent. Nearly all of their men are skilled laborers and 
would be able to work on defense work. They are bidding on defense contracts 
almost continuously trying to get them. Their present defense work consists of 
making the rubber parts for the G. M. T. Army trucks. Present employment 445. 

Jig Bushing Co. (Mr. Brinev, Jr): Automobile curtailment wouldn't affect 
their production much now. Their viork is mostly defense oiders. They tiain 
their men themselves — about 55 percent of them are now skilled laborers. De- 
fense orders are all subcontracts making bushings and valve sockets for airplane 



NATIONAL DEFENSE MIGRATION 



7129 



motors. Will probably have more defense contracts but at present are behind 
on orders, have more than they cftn take care of for a while. Present eir.ploy- 
ment 118. 

Pontiac Pattern & Kna;ineering Co. (Mr. Albert Weber): Cut in automobile 
production ^^'0uld cut their employment about 5 percent. Most of their men are 
skilled. Only uefense work is subcontract work making aluminum and bronze 
castings. Expect to have more defense contracts. Present employment 35. 

Pontiac Appliance Co. (Mr. Victor Nelson): /ibout 10 percent curtailment 
would take i^lace if automobile proauction is cut. Eighty percent of the men 
are skilled woricers and are doing defense work. About SO percent of the work is 
defense contracts. They expect to have more. They make steel spinnings and 
stampings. Present employment 67. 

Universal Oil Seal Co. (Mr. Victor Nelson) : About 10 percent of the men would 
be unemploved due to +he automobile production cut. Eighty percent of the 
men are skilled woikers and are doing defense work. About 80 percent of the 
work is defense contracts. Expect to have more. Make oil seals for trucks, 
tanks, airijlanes, and Navy. Present employment 85. 

Wilson P'oundry & Machine Co. (Mr. Leonard) : Emplojmient would be cut 
approximatelv 50 percent at the automobile production cut. Twenty-five percent 
of the men are skilled aiu. are able to work on defense work. Are trying to got 
more defense contracts, have some now. They do machine and founciy work and 
Navy and Ordnance work. Present employment 480. 

Pontiac Varnish Co. (Mr. Hutchins, Sr.) : Employment would be grea+ly 
affected bv automobile pioduction cut. Didn't know exactly how much but he 
spid a great deal. fteventy-fi\e percent of the men working aown there are 
skilled laborers and are woiking on defense work. Defense work comes in sub- 
contracts. Have been trying to get more defense work but have been unable. 
Would like veiy much to have more of this woik. Present employment 40. 

Average monthly employment 



January 

February.. 

March 

April 

May 

June 

July 

.August.. _. 
Se))teTnber. 

October 

N()\ ember. 
December. 



193/ 


193S 


1939 


1940 


16,018 


11,592 


14,3ry2 


15. 886 


11,331 


11,174 


14,775 


10,181 


23,910 


9,878 


14,518 


15,951 


23,881 


0. 108 


13, 676 


16,813 


23, 922 


8, 858 


13. 467 


17,8S5 


24. 509 


(i, 892 


11.242 


16, 953 


24, 150 


fi, 3(32 


5,977 


11,334 


20, 448 


5, 792 


8,234 


17. 572 


22. 013 


8,926 


13. 227 


19,584 


22, 497 


ll.OOl 


14,313 


21,667 


19, (330 


14,873 


15,542 


23. 380 


18, 172 


15, 054 


16, 167 


24. 016 



22,478 
23, 424 
24, 010 
23, 987 
23, 525 
23, 771 
23, 035 
15, 058 



This report will gi\'e you a very good cross section of the situation that confronts 
this area. In making up this survey I have used numbers. I will give you, here- 
with, the names of the concerns as numbered on report. 



Kawneer Co. 
Michigan Mushroom Co. 
Michigan Wire Goods Co. 
Mid- West Metal Products Co. 
United States Aviex Corporation. 
National Standard Co. 



1. Niles Cabinet Co. 7. 

2. Niles Metalcraft Co. 8. 

3. Niles Steel Tank Co. 9. 

4. Tyler Fixture Corporation. 10. 

5. French Paper Co. 11. 

6. Garden City Fan Co. 12. 

In summing up this report, I will endeavor to give you a little additional infor- 
mation. In the Niles area the Kawneer Co. will release 50 men by the end of the 
year d'le to lack of materials. The Niles Steel Tank Co. lias orders sufficient to 
keep them operating at capacity but are unable to get delivery on steel. They 
expect to be entirely out of material by October 15 at which time if steel deliveries 
are not made they will have to close their plant, releasing 28 welders and helpers, 
sheet-metal workers and lay-out men. The Michigan Wire Goods Co. expect to 
lay off 8 punch-press operators within 30 days due to lack of materials. The Niles 
Metalcraft have only a few days supply on hand and will be required to let 11 men 
go. 



7130 DETROIT HEARINGS 

The over-all attitude of industrialists in this area is one of extreme uncertainty. 
They are all doing everything that they know of to procure defense contracts thus 
keeping their plants operating and their personnel intact. It is estimated by Mr. 
Walter Sorenson, president of the U. W. A. — A. F. of L. that the various industrial 
plants in Niles have lost approximately 300 workers in defense industries to South 
Bend and Buchanan with a few going to Berrien Springs. It is estimated that 
about 1,500 men living in this area are employed in South Bend and Buchanan. 

Mr. Horst, personnel director of the Kawneer Co., states that in his opinion 
the loss of workers to outside concerns is due to uncertainty (60%) and wages (40%). 
One reason for the latter si the fact that our industries do not have the type of work 
that commands the high wage scale. 

The Niles situation is far from encouraging and it is my opinion that assistance 
must come from the priority division in releasing some material for consumer 
consumption. If this does not happen we are going to have a very serious unem- 
ployment situation in Niles and this area. We must have either the release of 
materials for consumer consumption or the allocation of subcontracts, so that they 
can be more evenly spread among small manufacturers to keep their men at work. 

A wide spread of unemployment in industry would create a bad morale condition 
in other lines of business. It will surely have a bad effect upon the sale of defense 
savings stamps and bonds and will create untold hardships. 

REPORT ON 12 NILES, MICH., INDUSTRIES 

1. A woodworking plant manufacturing radio cabinets and occasional furniture. 
Fifty-eight employees. Have not been affected by material shortage or priorities 
as yet. However, report that glue situation is getting bad. Have no defense 
orders, but would like some. Equipped only for woodworking. 

2. A metal stamping plant equipped with cadmium plating facilities producing 
rubber mops and household specialties. Twelve employees. Must have sheet 
steel in coils or strips and sheet rubber. Have on hand 2-day supply of rubber and 
approximately 60-day supply of steel. Have been trying to get subcontracts, but 
have failed so far. Must have material for consumer goods or subcontracts, or 
will have to close the doors. 

3. A plant manufacturing steel tanks and tank equipment. Thirty-two em- 
ployees. Production about 30 percent on defense orders. There difficulty has 
been in getting priorities from customers in time to replace their present stock 
of raw material or get new material. Have tried hard to get subcontracts, have 
listed with 5,000 prime contractors but cannot get enough to keep plant operating. 
Regular consumer business would require about 100 tons per month of hot-roU 
steel sheets and bars. 

4. Plant manufacturing steel displays and storage equipment for food stores. 
Three hundred and nineteen employees. Ten percent defense production on food- 
storage equipment. Are badly in need of material for consumer business. Esti- 
mate requirements — 20,000 pounds black-sheet steel, 30,000 pounds galvanic- 
sheet steel, 8,000 pounds stainless-sheet steel, 100,000 pounds vitreous-sheet 
steel, 10,000 board feet hardwood framing, 150,000 board feet soft lumber for 
crating, 1}^ carloads of crystal and plate glass. The above estimate is for 1 
month's production for normal capacity. Must have the above material for con- 
sumer business or sufficient subcontracts to keep plant on 40-hour basis or un- 
employment must result. 

5. A paper mill manufacturing printer bond, mimeographed bond papers. 
One hundred and thirtj'-three employees. Twenty-five percent production on 
printing paper for Government printing department. The only shortage this 
concern is experiencing is in steel banding for packing and shipping purposes. Also 
some delay in getting chemicals used in manufacture of paper. However, they 
state that a shortage in pulp and chemicals would materiall}' reduce their em- 
ployment. 

6. A plant manufacturing fan-blower apparatus for industrial application. 
Fifty-five employees. This concern is on 90-percent defense production basis 
on subcontracts. Have plenty priority numbers but having trouble getting 
material from mills and foundries, particularly stainless steel, which curtails em- 
ployment and production. 

7. This concern manufactures store fronts, windows, doors, automobile and 
aviation parts. Five hundred and fifty employees. Working 30-percent defense . 
subcontracts. Looking for more. Have priorities on material to take care of 
defense subcontracts but consumer business is suffering. Must have more 
subcontracts or aluminum and steel for consumer business or must curtail em- 
ployment. 



NATIONAL DEFENSE MIGRATION 7131 

8. This concern grows and cans food products. Have no Government orders 
at present time, are having considerable difficulty in securing cartons for shipping 
consumer products. . t-i ^ 

9. This concern manufacturers a line of wire and steel specialties. P orty-seven 
employees. This concern has a well equipped stamping plant, excellent toolroom 
for making dies, bending jigs and fixtures. They have no defense contracts at 
present; are endeavoring to secure defense work. To keep plant on consumer 
production of 40-hour workweek must have approximately 30 tons of round basic 
wire and flat steel wire and 10,000 corrugated shipping cartons per month or sub- 
contracts carrying priorities to keep plant open. 

10. This concern is a well equipped small stamping plant with complete tool- 
room. Twelve employees. This concern has registered with O. P. M. offices at 
Detroit and Chicago and has submitted apphcation for subcontracts with hundreds 
of prime contractors but to date have been unable to secure any subcontracts. 
Must have either subcontracts or material to carry on regular consumer business 
or will have to lock the doors. 

11. This concern are oil blenders. Fifteen direct employees, 160 distributors 
affected. About 30 percent of their business is being sold to United States 
Government through distributors located all over the United States. They are 
unable to get steel drums to ship product in. Their requirements are as follows: 
15 to 20 drums of following sizes per month— 55, 30, and 15 gallon capacities; also 
approximately 100 5-gallon drums per month. This concern had on hand 5 orders 
from United States Government at the time of contact with them. They were 
unable to ship because of shortage of shipping containers. Have made application 
for prioritv numbers at Chicago and Washington but as yet have had no results. 

12. This concern are manufacturers of woven-wire products. One hundred and 
ninety-two employees. They are doing 70 percent on subcontracts defense pro- 
duction. Need niore defense production or material such as steel sheet, bar steel, 
and maintenance items to continue in part on consumers' production or unemploy- 
ment will result. 

GRAND HAVEN 

We only have one plant acting on direct orders from the Navy which is running 
at full capacity. The rest of our industries are acting as subcontractors or are 
doing only civilian production. 

W^e have approximately 7 plants working on direct civilian production and 
doing no defense work. The total employed in these plants will run between 400 
and 500 people. Their situation is serious and small lay-offs are already being 
made which will increase as their inventories reduce. From 2 to 3 months will 
clean out the inventories of practically all of these plants. 

A number of the factories are only part on defense work and this in a very small 
volume. They, too, will be faced with laying off men unless they can secure addi- 
tional defense work. 

Our manufacturers and the Chamber of Commerce have made every effort to 
relieve this situation. We have been to Washington, Detroit, and Chicago 
calling upon the Office of Production Management and upon many prime manu- 
facturers. To date we have had no success. 

The majority of our small plants are in the stamping business. They can look 
forward to very little relief as far as defense work is concerned, as many of the 
prime manufacturers have idle stamping equipment. They naturally will not 
farm out any work when their equipment is idle. 

After 4 months' experience with the subcontractor problem our deduction is 
that Congress should pass some regulation forcing the large prime manufacturers 
who have tremendous amounts of materials stored up to release them. Secondly, 
that a more efficient system, be developed by the Office of Production Management 
in getting out information of work wanted by the various departments of the 
Government and the large contractors in order that the small manufacturer can 
receive notice of these bids in time to bid on the work. 

In many instances we have received requests for bids on defense work after the 
bid has been let. In the majority of cases we receive requests for bids only a day 
or two before the date the bid is to be let. This does not give the small manufac- 
turer time to figure his cost nor contact his suppliers and so forth. Another point is 
that the delivery date should he based upon when the manufacturer receives his 
material and not on the date specified in the bid. In many cases the manufac- 
turer will bid thinking that he will secure the material and then he finds that he 
cannot get as early or prompt delivery as anticipated or promised. 

The writer sent a plea to Governor Van Wagoner for relief on this situation and 
in doing so made an observation to this effect: "Why should there be so much 



7 J 32 DETKOIT HEARINGS 

confusion in the subcontract work when it has been operated for the last 25 years 
by the large manufacturers? Our automobiles, radios, refrigerators, washing 
machines, and so forth are all built under the subcontract system, so it is hard to 
understand why there is so much confusion now." 

MtJSKEGON 

There has been considerable migration of labor into Greater Muskegon from the 
area within a radius of about 60 miles, but the migration from outstate and from 
other States has been very negligible. Employment in our greater Muskegon 
industries was, according to our monthly survey made in August, the largest in our 
history. The previous peak was 18,200 reached in 1937 and in August of this 
year it was approximately 22,600. This, of course, is only industrial employment. 

Of this number I woufd estimate 1,500 as coming in from out-of-town, but not 
more than 200 or 250 have come in from places outside of this 60-mile area. 

When your letter came to us we had in process a questionnaire endeavoring to 
determine from our local industries, as well as from other western Michigan 
industries, members of our West Michigan Legislative Council, just how they 
were affected by this defense production program. Our local industries responded 
fairlv well, about 80 percent of them answering the questionnpire, which is a very 
goodly percentage. Sixteen of the west Michigan legislative group outside of 
Muskegon also answered. 

We are giving you a compilation of the answers received. The figure for 
amount of contracts awarded is taken from the figures we receive from the Detroit 
office of Office of Production Management. We have no figures for the plants 
outside of Greater Muskegon. The bulk of the Muskegon contracts went, of 
course, to the Continental Motors. We understand that they have approxi- 
mately $90,000,000 in contracts, but a large portion of this is being taken care 
of in "the Detroit plant. They are, therefore, not included in our figures. We 
understand that another large industry here has just been awarded a contract 
totaling about $3,000,000, but this is not included as the actual contract has not 
yet been received. 

We are rather surprised at the small number of plants who believe that their 
employment will be reduced because of lack of material. Apparently niany of 
these have not yet come to a realization of the seriousness of this situation. 

COMPILATION OF ANSWERS TO QUESTIONNAIRES SENT TO GREATER MUSKEGON 
INDUSTRIES ON EFFECT OF DEFENSE PRODUCTION 

Number of plants answering questionnaire 41 

Number of employees Sept. 1, 1941 18,160 

Number of employees June 1, 1941 18, 600 

Number employed Sept. 1 by those reporting reductions in em- 
ployment 8, 695 

Number emploved June 1 by those reporting reductions in em- 
ployment. - - J 9, 906 

Percent reduction in plants reporting reduction in employment 12. 2 

Amount of prime contracts in hands of local contractors $42,999,305 

Number producing defense materials 31 

Number of prime contractors 10 

Number of subcontractors 24 

Percent of defense production to total production: 

to 25 percent 71 51 to 75 percent 9 

26 to 50 percent 8 | 76 to 100 percent 7 

QUESTIONS AND ANSWERS 

If not now producing defense materials have you tried to obtain contracts? 
Yes, 9. No, 1. 

From what sources have vou tried to obtain such business? 



Regular customers. 
Other sources 



Army 6 

Navy 6 

Defense contract service 9 

Are you experiencing any difficulty in obtaining — 

Raw material? Contractors," yes, 25. Noncontractors, yes, 8. 
Equipment? Contractors, yes, 18. Noncontractors, yes, 8. 
Tools? Contractors, yes, 21. Noncontractors, yes, 9. 
Other supplies? Contractors, yes, 18. Noncontractors, yes, 10. 



NATIONAL DEFENSE MIGliATION 



7133 



Have you found it necessary to reduce your working force because of inability 
to obtain above items? Yes, 7. No, 34. 

If so, how much? Two, 10 percent. One, 11 percent. Two, 20 percent. 
One, 50 percent. 

Have you found it necessary to reduce hours per week because of such short- 
ages? Yes, 5. No, 33. No answer, 3. 

If so, how much? Four, 8 hours. One, 6 hours. One, 10 hours. 

Do you anticipate further reductions in working force because of inability to 
obtain material or equipment? Yes, 19. No, 12. No answer, 6. 

Do you anticipate future reduction in hours because of such shortages? Yes, 18. 
No, 7. Don't know, 5. No answer, 11. 

Could your plant be converted to production of materials other than your 
regular line? Yes, 14. No, IG. Doubtful, 11. 

If so, would you be willing to convert it realizing that it might affect your 
normal business? Yes, 14. No, 5. Depends, 8. No answer, 13. 

Number affected by priorities on following commodities. 



Commodity 



Aluminum 

Borax and boric acid 

Calcium — silicon 

Chlorine 

Chromium 

Copper 

Cork 

Formaldehyde 

Pig iron^_ 

Scrap iron and steel _ 



Affected 
by 



Trouble 
obtaining 



Commodity 



Steel — general 
Machine tools 
Magnesium.. 

Neoprene 

Nickel- - 

Rubber 

Silk 

Tools, cutting 

Tungsten 

Zinc 



Affected 
by 



Trouble 
obtaining 



22 
19 
1 
3 
7 
5 
1 
24 
4 
5 



BATTLE CREEK 

One manufacturer reports unable to obtain steel for making defense houses. 
Recent order of Supply Priorities and Allocations Board granting priority to 
houses under $6,000 will undoubtedly help. Another manufacturer reports 
reduction in employment of 50 percent if he is unable to obtain any further 
defense contracts and other materials are shut off under priorities. Another 
manufacturer reports complete shut down if further defense work cannot be 
obtained. One manufacturer is completely loaded with defense work and is 
having no difficulty; has increased his employment considerably. 

All manufacturers' reports to the chamber of commerce, except one or two who 
have defense contracts, show that employment will be decreased 50 percent up to 
100 percent if defense cannot be substituted for civilian work. 

Some migration of labor from smaller communities into Battle Creek. 



Exhibit B. — Replies to Query on Subcontracts and Employment in Plants 
OF Battle Creek, Mich. 

correspondence submitted by JOHN L. LOVETT, GENERAL MANAGER, MICHIGAN 

manufacturers association 

United States Register Co., 
Battle Creek, Mich., September 8, 1941. 
Mr. John L. Lovett, 

Managing Director, Michigan Manufacturers Association, 

Detroit, Mich. 
Dear John: We understand that you are going to have an opportunity to 
appear before the House Committee Investigating National Defense Migration, 
and we want to give you information pertaining to the situation we find ourselves 
in at the present time. 

Since the emergency started, quite a considerable portion of our production has 
been for direct defense work. During the last year we have supplied registers 
and vents of a total weight of 367,340 pounds to Army forts, airports, national 
defense housing projects, and other direct defense work. 

Under the present set-up it is not possible for us to obtain a priority rating for 
our steel requirements. We have to make our quotations to the subcontractor 
months before we receive the order and when the order is received we must agree 



7134 DETROIT HEAKINOS 

to make delivery by a certain time. If we waited until we were assigned the order 
before we placed our orders for the material necessary we could never make 
deliveries at the time required by the Government. For this reason we must have 
supplies of steel here in advance of receiving the orders for these defense projects. 

Under the defense rating plan we could obtain in this quarter the amount of 
steel necessary to replace the steel that we used in filling direct defense contracts 
during the previous quarter, but by the time we could get this priority arranged 
the present quarter would be almost gone. 

\\ ith full priority being put on steel as of September 1, our suppliers tell us they 
cannot guarantee that we will get anywhere near our minimum requirements 
during the next 2 or 3 months. At all times we have several quotations out on 
defense projects and if we eventually receive the orders from these quotations we 
do not know where we are going to turn to get materials with which to be sure 
that we will be able to fill these orders and as you know, most of these Government 
contracts contain a penalty clause. 

There must be a large number of manufacturers whose problem is the same as 
ours as we have outlined above. We are only too willing and glad to do all we can 
in the interest of national defense and we want to be in a position to give the 
service required on these defense orders when the orders are received by us, and 
it seems as though some plan should be put in effect by Office of Production 
Management so that people in our status will be able to obtain the necessary 
materials to put us in a position to take care of these orders as they are received. 
We are not trying to hoard steel and the facts in the case are that unless we get 
some relief before the end of this month we will not only be unable to take care of 
some defense orders but we will also have to lay off some of our help. 

We understand that the Federal Housing Administration are endeavoring to 
have Office of Production Management classify all housing costing $6,000 or less 
or built to rent for $50 per month or less as defense housing, but so far this order 
has not been issued. At least 85 percent of our production goes into such housing 
and no one can dispute the necessity of continued effort in the future to supply 
the required housing in this class. 

We sincerely trust that you will have an opportunity to present these facts to 
the committee for their serious consideration. 

With kindest regards, we are 
Very truly j'ours, 

United States Register Co. 
F, C. Bowers, President. 



Battle Creek Chamber of Commerce, 

Battle Creek, Mich., September 19, 1941. 
Mr. John Lovett, 

Michigan Manufacturers Association, 

Detroit, Mich. 
Dear John: Pursuant to our agreement, we are enclosing herewith replies 
which we received from local manufacturers. Should we receive any additional 
ones, we will forward them to you immediately. 

Incidentally, you might be interested in knowing that Wednesday night we had 
a meeting of management of those firms whose plants do not have any defense 
work, or whose facilities are not being completely used for defense work. This 
group is making a survey of facilities available in an endeavor to combine those 
facilities so as to bid on prime or subcontracts. 

Sorry you did not stay longer at Grand Haven. Would like to have seen you. 
Verj^ truly yours. 

Battle Creek Chamber of Commerce, 
R. Habermann, Secretary. 



Battle Creek Foundry Co. 

Subcontracts from Clark Equipment Co. Rating A-l-a to A^IO. 
Contract from Grand Trunk R. R. Rating A-3. 

Now running at full capacity. At present we do not believe any unemploj^- 
ment will result because of priority materials. 

Battle Creek Foundry Co. 
By C. J. Lofgren. 



NATIONAL DEFENSE MIGHATION 7135 

Electrical Manufacturing Co., 
Battle Creek, Mich., September 4, 1941. 
Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 
Gentlemen: In answer to your memo of September 3, the following informa- 
tion is given: 

(1) We have a primar}' defense contract in the amount of $78,000, no sub- 
contracts. 

(2) There will be no increase in our emploj^ment resulting from this contract 
as the work will be done by our regular employees since we are unable to get 
material for our regular nondefense work. 

(3) No unemployment will result at present; however, unless we secure an- 
other defense contract when our present one is completed, approximately the 
coming November, it will be necessary to shut down our entire plant because of 
lack of materials which have been diverted to defense. 

Very truly yours. 

Electrical Manufacturing Co. 
Geo. C. Price, President. 



Battle Creek Bread Wrapping Machine Co., 

Battle Creek, Mich., September 4, 1941. 
Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 
Gentlemen: We have j'our letter of September 3 asking for data to put in the 
hands of John Lovett of the Michigan Manufacturers' Association. 

To answer question (1) we have no prime contracts. We are handling sub- 
contract work in several different directions, that is to say, for several companies. 
To answer question (2) an estimate of increase in employment resulting from 
the defense program is 50 to 60 percent of a late 1937 date. 

In answer to question number (3) as to an estimate of unemployment which 
will result because of priority of materials, or shortages, is 90 to 95 percent of our 
entire organization. In fact, if we feel the pinch in this direction as we are told 
we will, it will unquestionably mean our closing our doors and having to go out of 
business. 

Sincerely yours. 

Battle Creek Bread Wrapping Machine Co. 
Boyd H. Redner, Assistant Manager. 



General Foods Corporation, 

Post Products Division, 
Battle Creek, Mich., September 4, 1941- 
Battle Creek Chamber of Commerce, 

Fattle Creek, Mich. 
(Attention: Mr. R. Habermann.) 
Dear Sir: Answering your questionnaire of September 3 for the Michigan 
Manufacturers' Association, this is to advise that we have no primary or sub- 
contracts for defense purposes, consequent!}' have no change in employment 
because of any defense work. 

We do, however, notice an increase in our business because of the general in- 
crease throughout the countr.y due to the defense program. 
Yours very truly. 

General Foods Corporation, 
S. H. Zimmerman, Plant Manager. 



Oliver Farm Equipment Co., 
Battle Creek, Mich., September 4, 1941. 
Battle Creek' Chamber of Commerce, 

Fattle Creek, Mich., 
(Attention: R. Habermann, Secretary.) 
Gentlemen: In reply to your general bulletin of September 3, wish to advise 
that we have some subcontracts in our plant that have not changed our employ- 
ment at all. 

60396 — 41— pt. 18 6 



7136 DETEOIT HEARINGS 

As far as unemployment is concerned because of ])riority materials it is hard 
for us to estimate at this time; however, we are finding it rather difficult to take 
off on our 1942 schedules. Materials that we anticipated receiving in August 
are now promised us in October, therefore if this condition does not improve or 
if we fail to get material in those days it will mean a loss of employment of approx- 
imately 25 percent in this plant. 
Very truly yours, 

Oliver Farm Equipment Co., 
C. W. Johnson, Plant Manager. 



Clark Equipment Co., 
Buchanan, Mich., September 9, 1941. 
Mr. R. Habermann, 

Secretary, Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 

Dear Sir: Your mimeographed memorandum of the 3d has been referred to 
me. 

Your memorandum is not clear, and I do not know whether you refer to our 
Battle Creek plant, or to the company as a whole, but I assume you are referring 
to the company as a whole. 

We do not give out details on our Government contracts, but we have a num- 
ber of them both direct and indirect. 

Answering question 2, our employment is up about 50 percent over a year ago, 
and it, of course, can be assumed that the bulk of this increase is from the defense 
program. 

Answering question 3, we do not anticipate any unemployment because of 
priorities of material. 
Yours truly, 

Clark Equipment Co., 

A. S. Bonner, Vice President. 



United Steel & Wire Co., 
Battle Creek, Mich., September 9, 1941- 
Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 
(Attention: Mr. R. Habermann.) 
Gentlemen: I will answer in order the questions put to us in your letter of 
September 3. 

We have only one subcontract at this time — the job of making tool boxes for 
the Duplex Printing Press Co. We are, however, furnishing wire shelves and 
certain other wire parts to some of our accounts whose product in turn is sold to 
the Government, or imder the defense program. We estimate this volume of 
business as about 5 percent of our total. 

We are operating almost at a maximum at the moment so there would be very 
little increase in employment at our place if we secure more Government business 
than we have now. 

If we don't get more defense business within the next few v/eeks, we will have 
to cut down our force considerably as we are not able to get some of the materials 
which go into certain of our products. I am not in position to say how many 
people we would have to let go for everything would depend on the amount of 
work we would be doing under the defense program and along our regular lines. 
It is certain, however, that there will be a cutting down of our force if we don't 
get the amount of defense business we need to offset the amount of business we 
can't handle due to our inability to get materials needed. 
Very truly yours, 

United Steel & Wire Co., 
By C. G. Genebach. 



NATIONAL DEFENSE MIGRATION 7137 

Michigan Metal Products Co., 
Battle Creek, Mich., September 8, 1941. 

Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 

(Attention R. Habermann, secretary.) 

Gentlemen: In reply to your memorandum of the 3d. 

1. We have had one primary Government contract for bedstead card holders 
for the Army, amounting to $4,875. 

2. This resulted in no appreciable increase of employment. 

3. It is rather difficult to estimate the unemployment that might result from 
Ijriority of materials unless steel in second sheets, which we use, should be placed 
mider the priority plan, which has not as yet been done. If this action is not 
taken we can continue normal o])eration, in our opinion. 

Yours very truly, 

Michigan Metal Products Co., 
M. L. Gardner, General Manager. 



Globe Manufacturing Co., 
Battle Creek, Mich., September 8, 1941. 

Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 

(Attention Mr. R. Haberman, secretary.) 
Reference: Your memorandum letter, September 3. 
Subject: Em])loyment survey. 

Gentlemen: We are now doing subcontract work for a local manufacturer 
working on defense orders. 

This has increased our factory employment approximately 50 percent. 
We should probably be completely shut down, however, because of inability to 
get material for our own line were it not for this special machine work, and we 
liave no way of knowing how long it will last. 
Yours very truly. 

Globe Manufacturing Co., 
M. R. Tyrrell, Treasurer. 



Alsteel Manufacturing Co., 
Battle Creek, Mich., September 11, 1941. 

Battle Creek Chamber of Commerce, 

Battle Creek, Mich. 

(Attention Mr. R. Habermann.) 
Dear Sir: The following information is sent you in response to your request 
dated September 3, 1941. We understand this information is to be used by Mr. 
John Lovett, of the Michigan Manufacturers Association, in a summary of facts 
to be presented before the House Committee Investigating National Defense 
Migration. 

1. (o) Primary contracts, none. 

(6) Subcontracts: (1) No. DA-W-535-AC-56. Rating A-l-E; (2) No. 
W-398-QM-10250. Rating A-l-F. 

2. An estimate of increase in employment resulting from defense program, 
15 percent. 

3. An estimate of the unemployment because of priorities would be about 50 
percent if we were unable to secure materials to manufacture items not classed 
as defense and essential items. 

Forty-seven percent of our total volume for August 1941 was produced under 
priority ratings ranging from A-l-D to A-10. 
Very truly yours. 

Alsteel Manufacturing Co., 
H. B. Ford. 



7138 DETROIT HEARINGS 

TESTIMONY OF JOHN LOVETT— Resumed 

Mr. OsMERs. Now, I am quoting from your paper because I want 
to question you about it a little bit. You say here [reading]: 

The hope of aiding the small manufacturers lies in getting the large manu- 
facturer enough business so that he can subcontract. 

Are you familiar with the York plan, in Pennsylvania:? 

Mr. LovETT. Yes, sir. 

Mr. OsMERS. Are there any possibilities in that plan for the State 
of Michigan? 

Mr. LovETT. The city of Ypsilanti has undertaken a similar plan, 
and there is some effort being made in Jackson along the same line, 
and also in Kalamazoo. 

Mr. OsMERs. Are these efforts meeting with success? 

Mr. LovETT. Not especially. The Ypsilanti plan is the furthest 
along, and they have employed an engineer and surveyed their situa- 
tion very carefully, but it hasn't produced any particular results. 
They are contacting the various procurement divisions, but up to now 
it hasn't brought anything particularly. 

LITTLE FIRMS FORGOTTEN IN DEFENSE 

Mr. OsMERS. One of the local newspapers here carried a story on 
July 25 that was headlined: 

Little firms forgotten in defense. Only 82 out of 1,407 in Michigan are on the 
Michigan Office of Production Management list receiving contracts up to July 1. 

I presume that that writer was referring to prime contracts? 

Mr. LovETT. He must have been, because there are a great many 
more that have parts of contracts. 

Mr. OsMERS. I see. What would you suggest, Mr. Lovett, that 
this Government do, through its O. P. M., that would spread this 
work? 

Mr. LovETT. I think the unportant thing in Michigan is to get the 
job into the prime contractor's hands. 

MICHIGAN A SUBCONTRACTING STATE 

We are fundamentally a subcontracting State. The manufacturers 
who produce a complete article themselves subcontract for parts, and 
they are not large enough, they haven't got tlie staff to go to Washing- 
ton and fight for contracts. In other words, if they bid on a contract 
they have got to carry all of their sales overhead, their advertising 
overhead — all that overhead. They have to carry it in a bid because 
they have been making a stove, we will say, and all of the costs have 
had to be carried in the stove. 

Well, you are not going to get any Government business on that 
basis. Now, if the prune contractor in Alichigan were able to go to 
that plant with his engineers and his buyers and pick out the particular 
things that man could do onthe defense program, he would probably 
get the job. 



NATIONAL DEFENSE MIGRATION 7139 

Mr. OsMERS. Would you say, following that line of reasoning, that 
the Government should crowd some of these prime contractors — 
the large contractors — more, than they are now, and give them more 
contracts and shorter schedules? 

Mr. LovETT. Right; absolutely right. That is the thing we have 
got to have in this State. We have got to have more, and push up 
the schedules. 

Mr. OsMERS. You are aware, as secretary of the Manufacturers 
Association, that there is almost a state of revolt among these small 
manufacturers, and that they feel that this has been a "big business 
boom," and that they have been left by the wayside. They can't 
go to Washington. They can't get priorities. They can't get ma- 
terials. And they are facing ruin, and the big ones are getting bigger, 
and the small ones are getting smaller. 

Have you found any disposition on the part of prime contractors 
in the State of Michigan to refuse to spread this work out, to try to 
hold as much of it as they can? 

Mr. LovETT. I have found just the opposite. For instance, the 
Chrysler Corporation, on this tank job, has 700 contractors. 

Mr. OsMERS. Are most of those in the State of Michigan? 

Mr. LovETT. No; they are scattered through their regular list. 
They have about 1,400 or 1,500 regular suppliers ui producing auto- 
mobiles, and they have tried to spread this out. What they would 
like to do is spread it out more and get more tank contracts and more 
of other contracts. There is no disposition not to spread it, because 
a lot of the parts manufacturers have the equipment that the prime 
contractor in the main plant may not have at all. 

Mr. OsMERS. You are right. Has your association analyzed these 
Michigan lii-ms with respect to their equipment for defense produc- 
tion? 

SURVEY OF EQUIPMENT OF 1,200 MANUFACTURERS 

Mr. LovETT. We completed a survey probably 6 or 8 months ago, 
in which we listed the equipment, the power sources, the source of 
raw materials, everything that we felt was necessary in the defense 
program ; and we turned that survey over to the local defense contract 
service, so they have a list of all of the equipment of some 1,200 man- 
ufacturers ui Alichigan on file there. 

Mr. OsMERS. Do you have any knowledge of whether they are 
using those files? 

Mr. LovETT. Oh, yes. 

Mr. OsMERS. They are using them? 

CHARGES DEFENSE CONTRACT SERVICE GETS ONLY "CATS AND DOGS" 

Mr. LovETT. They are using them. The trouble is with the defense 
contract service. They just get the "cats and dogs." The stuff is 
all let in Washington except what they can't find down there. Then 
they kick it over to the defense contract service. 

Air. OsMERS. Then the small man comes in? 

Mr. LovETT. On the cats and dogs, sure — something that nobody 
else wants, can't make. Then they try to farm that out through the 
defense contract service to the small manufacturers. 



7140 DETROIT HEARINGS 

You know that if it were a desirable contract, somebody would prob- 
abl}'^ grab it before it got out here, with all the salesmen there are 
around Washington trying to get contracts. 

Mr. OsMERS. You are agreeing with what I have said before about 
the big boys hogging it a little bit? 

Mr. LovETT. They don't do that. It isn't necessRrily hogging. I 
don't think that is the right phrase. 

Mr. OsMERS. Well, a rose by any other name would smell as sweet. 
I think it would be about the same anyw-ay, but let us not worry 
about the phrasing. 

Mr. LovETT. O. K. 

Mr. OsMERS. Let us go into the question of shortages of materials- 
here. Does your organization make any attempt to find out about th& 
shortages of material that are affecting your meml)ership? 

Mr. LovETT. None, except for the purpose of this survey. We 
canvassed, for your committee, all the local chambers of commerce as 
to their situation, and tluMr reports ar(> attached to my original state- 
ment.^ 

Mr. OsMERS. What is the most serious shortage situation you have? 

Mr. LovETT. Well, the steel situation is bad — steel, aluminum, and 
the alloys are all bad because they are strictly controlled. 

Mr. OsMEKS. Have you found in any important instance that the 
Priorities Division in Washington hasn't made fair and eriuitable 
decisions? 

MATERIAL DISTRIBUTION IN LAST WAR 

Mr. LovETT. The greatest criticism of the Priorities Division has 
been the delays in getting through orders after they have told you you 
were entitled to a priority, and in getthig that actually issued to you 
so you can pass it on for material. I would say generally the criticism 
on priorities has been based on the confusion that has existed in the 
O. P. M. m the whole priority question. I have felt that in the last 
war Mr. Baruch's idea of an inventory — inventoryhig the supplies on 
hand and then finduig out what the Government needed and letting 
the producers distribute the surplus, pro rata to their custoiners — 
was a much better scheme than trying to control the distribution of 
all of this material, which, apparently, is the plan of the O. P. M. now. 

Mr. OsMERS. Without basmg that distribution upon a natural 
inventory? . 

Mr. LovETT. That is right. I don't see how you can handle this 
material thin.g unless you know what is on hand, what you can produce, 
what the Government wants for 6 months or 12 months. It seems to 
me that is just a. b. c. but I don't flunk they have got that infonna- 
tion — certainly not as near as I can find out. 

Mr. OsMERS. You feel the tendency now is to put the cart before the 
horse and deal with the distribution of a product without determining 
what is on hand? 

Mr. LovETT. That is right. 

SPECULATIONS IN STRATEGIC MATERIALS 

Mr. OsMERS. I heard an amazing rumor over the week-end in New 
York about some of these strategic materials. According to this story, 
it seems that there are a great number of transactions now being con- 



« See Exhibits A and B, pp. 7122-7137. 



NATIONAL DEFENSE MIGRATION 7141 

ducted outside the pale of the Priorities Division — a sort of "black 
market" in materials, in which they are changing hands quickly. It 
is a speculative proposition, almost like a commo(iity market, and 
there are a great many transactions, and people never see the goods 
and never use them, and eventually they end up somewhere and are 
found to be not what they should be. Is such a thuig in existence? 

Mr. LovETT. I have heard that. I think there probably is a cer- 
tain amount of it going on. Naturally a fellow who wants material, 
a manufacturer, is going to get it if he can. I think that is being done 
largely hy brokers. 

Mr. OsMEus. That is right. 

Mr. I^ovETT. I don't think it is being done by the producer. 

Mr. ObiviERS. It is strictly a speculative proposition? 

A.r. LovETT. That is right. 

Mr. OsMERS. I am leading back to a pomt that you just made, that 
if the inventory had been made in the beginning, we would laiow about 
all of these things. It wasn't made, so there are little stores of these 
materials around the country and they are being speculated in just 
as one would in stock. Is that correct? 

Mr. LovETT. That is right. I have heard the rumor hereabouts that 
the Navy Department and a lot of its yards have enough steel on 
hand for 2 ja^ars. 

Mr. OsMERS. I would like to question you on that a little further. 
That accusation has been made against the Navy and the Army — 
that they have overordered to such an extent with the vast appro- 
priations at their disposal, that they have needlessly crippled not only 
defense but civilian mdustry in the United States. The story goes 
that at this time they have just gone into the market and embraced 
everything that w^as loose. Now, is that a charge that is made in the 
State of Michigan? 

Mr. LovETT. That is the cliarge that is made. You hear those 
rimiors. I discussed that very subject with one of the gentlemen in 
the O. P. M. He said, "Well, I can't answer you because we don't 
know." That was 2 weeks ago. Last week I was talkmg with him 
agam. He said, "Just last week we got an order to force the Navy to 
reveal its inventory." 

Mr. OsMERs. So we are getting back to the mventory question 
agam. 

Mr. LovETT. That is right. 

Mr. OsMERS. Another evidence of its necessity? 

Mr. LovETT. That is right. 

Mr. OsMERS. Now, has the R. F, C. financed much of this defense 
busmess out here? 

Mr. LovETT. Practically all the new facilities have been financed 
by the R. F. C. 

Mr. OsMERs. Your new plants? 

Mr. LovETT. Yes, sir; the Defense Finance Corporation. 

ZONING OF LABOR COMMUNITIES 

Mr. OsMERS. You made a suggestion in your paper that the Nation 
be zoned, on a basis of wages and other factorS; and that bids be taken 
on a zone basis or an area basis. Would you like to develop that a 
little further? 



7142 DETROIT HEAKIXGS 

Mr. LovETT. I would like to illustrate what I mean. We had one 
firm in Michigan which was designated by the Army Ordnance as a 
prime contractor. The Government spent the money and made the 
tools to make 3-incli shells. They ran an educational order, I think, 
of 15,000 shells. Then the Ordnance called for bids and the big con- 
tract of some 3 or 4 million shells went to a firm down in southern 
Indiana that had never had an educational order and never had been 
tooled up to the job. They were bidding on the basis of wages at 60 
cents and this particular Michigan plant had a wage of about $1.02. 

The Michigan plant, which was tooled and ready to go into produc- 
tion, didn't get the contract Now, the Army Ordnance, I under- 
stand, has recommended to the Attorney General that the districts 
with like wage levels — this Great Lakes District, for instance, around 
Detroit, Cleveland, and Toledo, has pretty much the same level of 
wages — should be zoned and should not have to compete with lower- 
wage districts, like southern Indiana and southern Illinois. 

"Labor Communities" 

I think that principle has been used in this designation of com- 
munities as "labor communities". Mr. Hillman, I thmk, has brought 
about a program by which certain cities are designated as "priority 
labor points," and a 15-percent mcrease m labor costs is permitted 
under bids, under his scheme. 

He has designated some 10 or 15 conunmiities in Michigan as 
priority labor districts. Now, that will give you a 15-percent advan- 
tage on your bids there on labor. 

But the reason we probably haven't a lot of prime contracts here 
is that our wage rates have always been high, and they are high now. 
Therefore, we have been out of competition with a lot of other dis- 
tricts. 

Mr. OsMERS. But aren't your methods of manufacture and your 
per unit cost in Michigan generally lower, even though your wages 
have been high? 

Mr. LovETT. That is right. 

Mr. OsMERS. A plant in southern Indiana may be paying 60 cents, 
wdiile you are paying a dollar? 

Mr. LovETT. Yes. 

Mr. OsMERS. Your firm in Michigan, it seems to me, should have 
been able to compete with an educational order behind them and 
obviously the requisite skill to do the job. I am wondering in my 
own mind how the firm in southern Indiana could make an intelligent 
bid. 

Mr. LovETT. I don't think they did. 

Mr. OsMERS. I don't think so either, because if they had made one, 
I believe that with the advantage of the educational order and pre- 
vious mass-production experience here, you probably would have had 
a lower bid in Michigan. 

Mr. LovETT. Well, I think our bid was reasonably honest, and I 
think the other felloM' was gambling. He got these shells for 3 cents 
a shell less than we did, but the point is that he had to tool up. He 
probably isn't in production yet, whereas our firm was ready to go 
ahead 6 months ago when tho order was let. 

Mr. Arnold. Was that a Du Pont concern in southern Indiana? 

Mr. LovETT. No, it was not. 

Mr. Arnold. And it wasn't a subsidiary of Du Pont? 



NATIONAL DEFENSE MIGRATION 7143 

Mr. LovETT. No; it was an independent concern. I have forgotten 
the name of it now, but I did know at the time; and the Michigan 
firm sent its engineers down to visit this gentleman and find out how 
it was possible for him to bid on this and get a lower figure than they 
did. They made a very thorough investigation to satisfy themselves 
just what had happened. 

Mr. OsMERS. What was their conclusion — that they had miscalcu- 
lated the job, or that he was paying lower wages? 

Mr. LovETT. Well, they figured that he probably would lose money 
on the contract before he got through, because he didn't know any- 
thing about how to make it and he just took a shot in the dark. He 
was paying at the time he took the contract 50 cents an hour. He 
figured 60 cents an hour on his wages in the contract. 

Mr. OsMERS. In other words, the total sounded like a lot of money 
and he thought he could get through on it? 

Mr. LovETT. That is right. He took a shot at it. 

Mr. OsMERS. Now, on page 3 (m this volume p. 7121) of your state- 
ment, you say, and I quote you; 

Generally speaking, Michigan is a mass-production State. It is a State where 
its manufacturers and workers are skilled in repetitive operations, and that is the 
kind of prime contracts that we in Michigan want. 

Then later on you say: 

The ro.anufacture of defense items, generally speaking, is a precision job. 

Now, do you consider those two statements to be in conflict? 

TRAINING PROGRAMS AND THE OLDER MAN 

Mr. LovETT. Well, there is a certain conflict, yes, because that will 
affect our labor problem, I think. There is quite a training program 
on here now. Men have to be trained especially for all this aircraft- 
engine business, and for a good deal of airplane riveting and that sort 
of thins:. 

The older men, who have been working for 10 or 15 years, we wdl 
say, on a repetitive operation, have developed no special skiU. They 
pick the piece up here and put it there and take it oft", and trip the 
machine. They don't set the machine up, they don't make the tools. 

Now, I don't know what position those men are going to have in 
the defense picture, because generafly speaking the younger men are 
the men who are being trained, and the ones who can be trained. So 
I am not so sure that'we won't have a problem in those men over 40 
who aren't able to be trained in these new processes. You can train 
the younger feflows on the skifled jobs, even though they haven't 
been working on them. But I doubt if you can train the other ones. 

Mr. OsMERS. We are confronted with that same proposition, of 
course, aU over the United States. I know in New Jersey we are 
making Wright motors in quantitv, and in Baltimore they are making 
airplanes in^quantity. I wouldn't want to guess at it, but I would 
say the average age of the men involved in those operations is probably 
around 21 or 22. It is amazingly low. 



7144 DETROIT HEARINGS 

WIDE TRAINING PROGRAM 

Mr. LovETT. That is right. 

Mr. OsMERS. Your situation here in Michigan would seem to call 
for a very wide training program of different levels of skill. Is that 
correct? 

Mr. LovETT. That is correct. The programs are on. Mr. Hall 
is more familiar wdth that program than I am. He has followed that 
very closely in Detroit, but we have quite a little training in industry 
itself and also in connection with the tools, not only in Detroit, but in 
Muskegon and Grand Rapids and Jackson. There has been carried 
on in Michigan for a number of years this vocational training within 
the schools, as a joint operation between industry and the school 
system. 

Mr. OsMERS. Has that developed to be a very wise program in this 
emergency? 

Mr. LovETT. It has been shown to be very wise, and it has been 
expanded a great deal in view of the defense orders that are out. 

Mr. OsMERS. I 1 ( ;ilize you are not testifying as an educator. But, 
could you give the committee briefly something about that established 
training in Michigan in comiection with yoin- public schools? 

Mr. LovETT. Well, we have operated here for a great many years 
on part time in the schools and part time in the plants. 

Mr. OsMERS. In the public schools? 

Mr. LovETT. That is right. 

Mr. OsMERS. And no tuition is charged the student? 

Mr. LovETT. That is right. 

Mr. OsMERS. Training young people of high-school age? 

Mr. LovETT. That is right, yes. They go part time to school and 
then they spend a part of their time in the factories. That has been 
the basis of vocational training in Michigan. 

The training that is given now, though, is more intensive than that. 
The men go right into the schools and take the training and then hope 
to get a job. It is entirely independent of that joint operation, but 
over the period of years this joint plan has been used in the industrial 
centers all over the State. 

Mr. OsMERS. Well, in your new programs, leaving aside your public- 
school program that has existed for years, in what categories do these 
training programs fall? Do the men pay for the courses themselves, 
or does the State pay for them, or is it Federal? How is it financed? 

Mr. LovETT. The"^men taking private-industry training are paid a 
wage as they go to school. 

Mr. OsMERs. That is the training-in-industry program? 

Mr. LovETT. Yes. The school program is paid for b}' the local 
schools and they have a grant, don't they, Mr. Hall, from the Federal 
Government? 

Mr. Hall. That is right. 

Mr. LovETT. And the men don't get any pay as they go there. 

Mr. OsMERs. Do the private schools figure in the Michigan situa- 
tion at all? 

Mr. LovETT. Privately o\vned, run-for-profit schools? 

Mr. OsMERs. Trade schools. 

Mr. LovETT. They are here to some extent, and always have been, 
and they are operatmg. I don't know how many pupils they have. 
Of course, you have in addition to the regular commercial trade 



NATIONAL DEFENSE MIGKATION 7145 

schools, other schools. General Motors has a school at Flint— the 
Flint Institute of Technology — and Ford has the Ford Trade School, 
and Chrysler has their Chrysler School, where they even go into 
giving degrees. These men are fed back into those industries. 

Mr. OsMERs. In those cases of the large automobile manufacturers, 
do they pay the entire cost of that education? 

Mr. LovETT. Oh, yes. 

EXPECTED UNEMPLOYMENT 

Mr. OsMERS. In your summary of the Michigan situation you pre- 
dict that milcss materials are forthcoming m a city like Grand Rapids, 
3,300 men may be laid off. Is that typical or is that an exception? 
f^ Mr. LovETT. Xo; I would say that is typical — that proportion — 
in a great many cities in Michigan. Grand Rapids is prunarily a 
furniture-manufacturing town, and they have a lot of metal workers 
there connected with the furniture mdustry — brass foundries and brass 
stampings, and that sort of thing. 

St. Joseph, Mich., is probably m the same situation. Sturgis and 
Dowagiac are probably worse than any of them. They haven't any 
big industr3\ AH they have is stoves and furnaces dowTi there, and 
up to now the Government has not been buying anj^ hand grenades 
or things that they can make m gray-iron foimdries of that type. So 
• I M-ould say that that is probably a fair report on the southw^estern 
part of Michigan. 

Now. in the northeast part, cities like Saginaw, Bay City, and Flint 
are devoted largely to automobile parts. They probably are not as 
badly off. But'in southwestern Michigan it is pretty bad, or will be. 

Mr. OsMERS. Your northern section is more adaptable to the needs 
of defense? 

Mr. LovETT. They have been making automobile parts and acces- 
sories, and they have the equipment that can be converted. 

Mr. OsMERs!^ Aside from hand grenades, what other things arc tliere 
that these stove manufacturers can make, these gray-iron foimdries? 

Mr. LovETT. Probably ammunition boxes and sheet-metal things, 
but they are not able to take very much of an order m one plant. 
Tlie3^ would have to pool orders or else the Government woidd have 
to split them up. 

They are primarily sheet metal and foundry industries tliere. 
They don't have an}^ close precision equipment. There isn't anything 
very precise about making a stove. 

Mr. Arnold. I attended a conference in Chicago about a week ago, 
and perhaps some of 3-our southwestern Michigan manufacturers and 
city officials were there. 

Mr. LovETT. They were. 

Mr. Arnold. They broke up into industrial groups and manufac- 
turers and city officials. Wliile I don't know that they knew I was in 
the meeting, "an official from Quincy, 111., which city was then being 
surveyed for something like the York plan or the Decatur plan, was 
telling the other officials that that was what they were going to have 
to do, "Forget peacetime manufacturing". JEIe told them they 
should quit peacetime manufacturing and go into defense production, 
and I thought for a short time they were going to throw him out of the 
meeting. 



7146 DETROIT HEARINGS 

Thej" seemed to think, when he mentioned that, that all they had to 
do was get hold of their Congressman or Senator and have him force 
the Government to furnish materials for these nondefense industries 
and let them go ahead as usual. 

Of course, I didn't speak up. I didn't want to disillustion them. 
But later Congressman Maas, who made the principal address, and 
from whom I think they expected some comfort, said that if they 
didn't get hep to the times and realize the situation in this Nation, 
they could expect to go out of business. 

Now, do you find any manufacturers of that type in Michigan? 
I don't know whether they are isolationists, or what they are. 

Mr. LovETT. Yes; it has been quite a task to bring them to the 
proposition that the defense is probably all they will have. Through 
our association we have run a regular campaign to try to convince 
them. We started in 6 or 8 months ago to tell them that if they expect 
to stay in business they had better try to get some defense orders. 

Mr. Arnold. Some of them are pretty hard-boiled, aren't they? 

MANUFACTURERS WANT DEFENSE CONTRACTS 

Mr. LovETT. I haven't seen very many hard-boiled ones here. I 
think they are hard-boiled in this way: they make up their minds 
they are going to get into defense, and then send a man around to 
try to find a defense contract, and he comes back very much dis- 
couraged, w-ith the result that they are mad at everybody. They 
can't get any steel, they know the steel people have told them they 
are going to be cut off, and they can't find any defense work that they 
can do, so naturally they are very much confused. 

I doubt very much if we have among the manufacturers of Michigan 
very many who have any objection to the defense program. They 
would love to get into it if they could. I think that is the great feeling 
in Michigan. I have found no manufacturers wdio have taken any 
other position. And quite a few smaller manufacturers, who I 
thought couldn't afford to do it, have sent men to Washington and 
kept them there for quite a while, trying to find something to do. So 
I don't believe that we have that situation. 

I do Imow that far out through the Middle West, of course, that is 
quite typical of the feeling that a great many manufacturers have. 
They have felt that they could continue to carry on their peacetime 
business. I beheve ours are better educated. They realize that that 
is impossible. 

O. p. M. SHOULD RELEASE MATERIAL NOT NEEDED FOR DEFENSE 

The peacetime manufacturer might carry on to a certain extent if 
the O. P. M. reached the stage where it knew what steel it had over 
the 12 months' period and could say to the manufacturers who use 
steel: ''Now, the country is producing 100,000,000 tons of steel this 
year; the defense program requires 50,000,000 tons. There will be 
50,000,000 tons of steel to go for nondefense purposes." If that were 
true, then these fellows would at least have the knowledge that they 
would get a piece of steel during the year. 

I think that has brought on the confusion — the absolute uncer- 
tainty as to where you fit in this picture. We know in industry that 
the facilities are not here for using all the steel that is produced m a 



NATIONAL DEFENSE MIGRATION 7147 

year in the United States. You just haven't got the defense plants 
to use it all. Now, why doesn't the Government arrive at the figure 
that it is going to use and let the rest of the country know what it 
may have? 

I think that might be done also in copper and brass. Then, I 
presume, there will be no private distribution of zinc. That is proba- 
bly all going into defense. But that is what our people out here feel. 
If they had some assurance as to what these programs were, you would 
find them in a much happier state of mind. 

Mr. Arnold. I thmk you are correct. I believe at this time more 
materials could be going to private mdustries that are not in the 
defense efi'ort. But of course rumors fly around, and the amomit of 
materials thought available is mcreased, and when these stories get 
around from manufacturer to manufacturer, they have it entirely 
too high, then a number of them are gomg to have to get into defense 
or quit. 

Mr. LovETT. That is right. 

Mr. Arnold. And they might as well make up their minds and 
quit buckmg around and fighting the Government and hindering the 
defense program. 

SOME PLANTS NOT EQUIPPED FOR DEFENSE WORK 

Mr, LovETT. Of course, Congressman, there is this pomt to bear 
in mind. There are many manufacturers who are not equipped to 
take on any defense work. They just haven't any equipment adapt- 
able to defense work. A woodworking plant for example, in this day 
and age hasn't much of a place in a defense program. 

During the last war they used to make wooden propellers for air- 
planes, and these woodworking shops had a lot of business. That 
need is all gone. The result is that you are bringing in a class of 
manufacturers who haven't the equipment and who never can get m on 
defense orders. Now, what is going to happen to them? Those are 
the ones that are really going out of busmess if this push, as they 
tell us in Washington, is going to come. 

I think most all the metalworking manufacturers eventually will 
be absorbed if they push the program, but you must bear in mind 
that a lot of them haven't any equipment that is adaptable. 

Mr. OsMERs. Mr. Lovett, you were here when I questioned the 
Governor, were you not? * 

Mr. LovETT. Yes. 

Mr. OsMERs. I tried to find out from the Governor a little about 
the State of Michigan's relationship to Washington. Not the State 
of Michigan, let us say, but the manufacturers of Michigan, in rela- 
tionship with Washington. The Governor seemed to think that over 
the hill there was a rainbow. 

Manufacture! s whom I know personally have no such rosy picture. 
They do not assume that everything is going to come out all right with 
these new services that have been established, and new officials ap- 
pointed. 

In your position as general manager of the Michigan Manufacturers 
Association, what would you say is lequired in Washington today to 
rnake the efforts of the Michigan manufaciuiers effective in the na- 
tional-defense program? 



7148 DETROIT HEARINGS 

Mr. LovETT. Well, I don't know whether you can do it in Wash- 
ington. 

Mr. OsMERS. Or anywhere else? 

DECENTRALIZATION OF BIDDING PROCEDURES SUGGESTED 

Mr. LovETT. What I would like to see is the centralization of all 
these specifications and requests for bids. I would like to see them 
sent out to localities like in Detroit and channeled through the de- 
fense contract office here as soon as they are made available in Wash- 
ington. 

In the last war I was m Illinois, with the Illmois Manufacturers 
Association. We set up, on our own initiative, the Illmois Manufac- 
turers War Industries Bureau. We hired an engineer and sent him 
to Washmgton. We furnished him with the itemized lists of equip- 
ment that we had in these industries in Illinois. His office became 
headquarters for a lot of procurement officers, because it was easier to 
go over to his office and find out who could make a thing than it was to 
run around the country. 

Well, what this man of ours in Washington did was to relay to our 
Chicago office all the blueprints and specifications on items that the 
Government was buying, and we then called in to our Chicago office 
the manufacturers equipped to make that stuff, and they sat around a 
table there and took on the contracts. 

Now, we haven't reached that stage in this situation, as I see it. 
Washington lets a lot of contracts that we know nothing about out 
here. The defense contracts office doesn't even loiow anything about 
them. 

Mr. OsMERS. You mean the contracts are let before the Detroit 
office of the defense contract service knows that they are going to need 
that equipment? 

Mr. LovETT. That is right. 

Mr. OsMERs. It is all over and done before they hear anything 
about it? 

Mr. LovETT. That is right. 

Mr. OsMERs. A frequent complaint that I have heard — and I am 
sure that every Member of Congress has heard it too— is that the 
small manufacturer cannot get an answer on materials. There just 
is no answer. In automobile production, for example, they skirt that; 
they run around in percentages; and certainly, with the hundreds of 
thousands of people involved, not only in tie State of Alichigan but 
in every town and hamlet in the United States, there should be 
something definite by this time on that industry. But I don't think 
there is a man now who can say exactly what percentage of automobiles 
made this year will be allowed to be manufactured next year; and they 
are about as nearly ready on that item as any in the list. So you can 
imagine what the result is, down in the lesser-known industries. 

Automobile manufacture is a front-page industry. 

It is well equipped to go and fight the battle. And yet, as any 
executive in the motorcar industry today will admit, he doesn't 
know what he is going to do from day to day; he doesn't loiow what 
materials he is going to get, and can't guarantee he is going to get any. 

Mr. LovETT. That is right. We don't know what we can get, when 
we can get it, where we. can get it, or whether we can get it. 



NATIONAL DEFENSE MIGRATION 7149 

Mr. OsMERS. You might be told that you can go ahead and make a 
thousand sedans. But then when you go to make them, you can't 
get the materials. 

Mr. LovETT. That is right. That is what we are up against right 
now. We don't know. 

Mr. OsMERS. I am going to switch the subject entirely now, and 
I want to ask you a general question with respect to the feelings of 
your organization on the post-war period. Have you thought about 
it at all? 

ANTICIPATES 2 YEARS OF POST-WAR PROSPERITY 

Mr. LovETT. Oh, yes. Well, the post-war period-ythat is shooting 
into the future. I believe most manufacturers in Michigan feel that 
for a year or two after this defense effort ceases they will have pretty 
good business, and pretty good 'employment, because they have got to 
replace a lot of things that have gone off the shelves. 

Mr. OsMERS. A lot of civilian goods? 

Mr. LovETT. Yes, sir; that was the experience in the last war. 

Mr. OsMERS. You think it will follow that general pattern? 

Mr. LovETT. The minute you start cutting down all of these so- 
called luxuries, you are going to find a pubhc that has made good 
money generally during this emergency, and they are gomg to want 
to buy such thmgs. So I think for a year or two at least we will 
run along pretty well and so will employment. But after that period, 
I don't know. ' I don't know what is going to happen. Nobody here 
knows. 

Mr. OsMERS. It doesn't look very proniising to anyone, does it? 

Mr. LovETT. No; there is great uncertainty. 

Mr. OsMERS. Now, tell me this: A great many things have been 
suggested, and are being suggested from day to day with respect to 
that situation. I would say Uiat most important was the suggestion 
to fix prices, to freeze prices, to control inflation, and keep us from 
gomg through the roof. How do your manufacturers feel about that 
idea? 

Mr. LovETT. They have no objection if you control the causes of 
prices which, of course, is costs; but it doesn't do any good to fix a 
price on a commodity and not fix a price on the constituent cost 
elements. If you are going to control prices you have got to control 
wages. 

Mr. OsMERS. Is there any disagreement on materials among 
Michigan manufactm-ers? 

Mr. LovETT. None that I know of. 

Mr. OsMERS. Several other suggestions have been made. In one 
of them I have been very much interested, and I probably will present 
it to Congress in the form of a bill. That is to extend the cushion of 
unemployment compensation after this emergency, extending the 
length of time, so that the transition period will not be as rough. 
Do you feel kindly toward such a plan? 

Mr. LovETT. I heard you ask the Governor that. I have been 
thinking some about it since. I am not so sure that is the answer. 
I am not so sure that the Government can find the answer. 

Mr. OsMERS. They can't find a complete or perfect answer, we 
know that. Wliat I have in mind is making such a proposal to 
lengthen the time of adjustment a little bit before we are on W. P. A. 



7]^50 DETROIT HEARINGS 

and city relief and everything else. The suggestion is that that can 
be done by taking more from everyone during the period of the emer- 
gency, thereby controlling an inflationary tendency by reducmg a 
little bit the amount of money that is available for spending. 

PREFERS UNEMPLOYMENT COMPENSATION TO DIRECT RELIEF 

Mr. LovETT. I would much rather do it your way than do it by 
W. P. A. and so-called direct relief propositions. 

Mr. OsMERS. I think you have a moral factor there that is very 
important. 

Mr. LovETT. That is right. 

Mr. OsMERS. A man who is drawing unemployment compensation 
payments feels, and rightly so, that he is drawing from a fund to which 
he contributed and to which he is entitled. He doesn't feel any of the 
stigma that a man would feel in going on relief. 

Mr. LovETT. I think, on your unemployment compensation idea, 
there is one fundamental factor that should be borne in mind. If you 
are going to extend your benefits, of course you have got to increase 
your taxes. 

Mr. OsMERS. That is right. 

Mr. LovETT. On your pay roll. Now, this pay-roll tax has a direct 
effect upon the cost'^of living, and it is one of the things that is going 
to keep the income, generally speaking, of the hourly worker, we will 
say, from ever reaching up to his outgo. 

We used to base our economy in this country, generally speaking, 
on a balance of income and prices. ^Y\\en you had an unsettled situa- 
tion, you had income do^vn and prices up, and sometimes you had 
income up and prices down. But it seems to me now that you have 
frozen the situation here, where your income never can reach your 
prices, for the simple reason that every time you raise wages you raise 
this tax, which becomes about 40 percent on the cost of your product, 
as you pyramid it through your various processing operations, so that 
you are alwavs pushing these prices up. Every time you raise a wage 
you are also raising the tax. If your Social Security tax or unemploy- 
ment compensation tax is 3 percent, you keep boosting it up because 
the producer must add it into his costs. So I question, in the long run, 
where that is all gomg to wind up in our national economy. 

ENGLISH REPORT ON UNEMPLOYMENT COMPENSATION 

The English made a very interesting report here 4 or 5 years ago, 
in which they analyzed unemployment compensation, the so-called 
Keynes theory of made work, and all that sort of thing; and you may 
recall that their commission came back to the proposition that when 
unemployment compensation for those who were working on factory 
pay rolls ran out, they went on direct cash relief at a subsistence basis. 
That was the finding of their commission. 

Mr. OsMERS. In view of all your own experience, is it your con- 
clusion that as a Nation we w^ould be better off to follow those recom- 
mendations and abandon this elaborate set-up and go on a direct 
subsistence basis? 

Mr. LovETT. Not at this time. I don't think we are far enough 
along in it. I think we have been emotional about it and I think we 
are still in the emotional stage. After we get into what we might hope 



NATIONAL DEFENSE MIGRATION 7151 

to be a normal era in the country, then we can find out whether it is 
successful or not, but I wouldn't want to say. 

CRITICISM OF DOLE SYSTEM 

Mr. OsMERS. One of the great criticisms that was made to that 
proposal and to the English system was implied in the word "dole." 

Mr. LovETT. Yes, sir; that is right. 

Mr. OsMERs. That gave it a very unfavorable light in the eyes of 
the American people. A great many working people thought: 
^'Well, if we do this it means that those of us who are working are just 
gomg to support a permanent army of people who will subsist within 
the population, people who never had either the ambition or the push 
to get a job at slightly more pay than subsistence." That was the 
great argument used agamst the plan. 

The Chairman. Congressman Osmers, I was thinking about your 
proposed bill to increase unemployment compensation, and I was 
trying to think along with you. Wliat jurisdiction would Congress 
have in passing any legislation telling the State of Michigan, for 
instance, how much its rates should be? We have the Federal 
Employees' Compensation Act, but that is limited, of course, to Federal 
employees. 

Mr. Osmers. I am referring to the unemployment compensation 
category of the Social Security Act. 

Mr. LovETT. You would take over the rate-making entirely as a 
Federal activity, would you, Congressman? 

Mr. Osmers. Yes, sir; probably exert more control over it. 

Mr. LovETT. I wouldn't favor that fundamentally. 

Mr. Osmers. I would like to say for the record that this proposal 
is still a long way from the perfected stage, and I expect to send it 
around and get a lot of advice from both employers and employees 
before I go further with it. (To Mr. Lovett.) What do you think 
of the forced savings plan? 

OPPOSES FORCED SAVINGS PLAN 

Mr. LovETT. I don't think very much of it. That becomes another 
tax, and I don't think it is in accord with the psychology of the 
American people. Even though they don't save, I don't think they 
like that. It gets back to the proposition of the check-off again, and 
not many of them like that, even though some of the union officials do. 

TESTIMONY OF WILLIS HALL, MANAGER, INDUSTRIAL DEPART- 
MENT, DETROIT BOARD OF COMMERCE 

Mr. Osmers. Now, Mr. Hall, you are general manager of the 
industrial department of the Detroit Board of Commerce? 

Mr. Hall. Yes, sir. 

Mr. Osmers. I have a couple of matters I want to discuss with you. 

It is the feeling of your group, is it not, that the workers who are 
going to be laid off in the automobile industry will, of necessity, have 
to be reemployed in defense if they are going to get jobs at all? 

Mr. Hall. That is correct; and it is the attitude of practically all 
of the employers in Detroit that they are going to make every effort 

60396— 41— pt. 18 7 



7152 



DETROIT HEARINGS 



to get enougrh defense work so tliat they can reabsorb their workers. 
That is their prin-ary objective at the moment. 

Mr. OsMERs. The paper you have submitted will be entered in the 
record at this point. 

(The paper referred to above is as follows:) 

STATEMENT BY WILLTS H. HALL, MANAGER. INDUSTRIAL DEPART- 
MENT, DETROIT BOARD OF COMMERCE 

Dotroit, Wayne County, is known as the home of mass production and the 
automobile industry. Today it is becoming the defense production center of 
America. 

Defense production is the No. ] job of Detroit's industry. The production 
genius of Detroit's industries and the skill of her workers a^-e })ein<.'- shifted 
from automobiles to tanks, aircraft, guns, and munitions. This shift brings 
manv problems and will cause teinporary unemployment for many Detroit 
workers. 

The tremendous growth of the automobile industry during the past 20 years 
has drawn workers from all over the United States to Detroit. It is axMomatic 
that when business conditions throughout the United States are reasonably 
normal Detroit and the automobile industry booms, when the country is in a 
depression Detroit business and employment drops, not as much as some large 
cities, but Detroit always bounds back first as economic conditions in the Nation 
improve. 

Thus employment in Detroit swings up and down and there is a migration 
of workers to and from Detroit with each swing. The attached tabulalion of the 
Detroit employment index indicates these peaks and vallevs. For example, 
the emplovment index went from a high of 130.6 in May 1937 to a low of 47.8 
in July 1938. During this period there was considerable migration away from 
Detroit. As busine>^s and employment improved during 1939-40 many of these 
workers returned to Detroit and found employment. The employment index 
reached 126.7 in June 1941, dropped to 96 in July during the automobile change- 
over period and recovered 116 on August 30. 

Industrial employment index, Detroit metropolitan area (1933-25 monthly average 
equals 100) — data as of middle and close of month 

[Prepared by industrial department of the Detroit Board of Commerce] 



January... 
February. 

March 

April 

May 

June 

July 

August 

September 
October... 
November 
December. 



ri27.0 
1131. n 
r"34,0 

I m,. 
r'37.8 

I I sr,. n 
n37.3 

'3<i.O 
ri37.0 

131.0 
"30.0 
I?S. ? 
r'?9.0 
131.0 
"3?. 
'27.0 
f'27.0 
119.0 
"07., 5 

08.5 
' S9. 5 

93.0 
■ 93. 1 

r8.0 



1930 



101.5 

ion. 5 

10'^. 5 
108.0 
108. 
108. .5 
100.0 
110.5 
111.5 
109.2 
10-1. 5 
99. 
58.0 
48.0 
8.5.0 
83.0 
80.8 
7-1.8 
78.0 
79. 
80.0 
75.8 
78.5 
40.0 



76.4 

70.5 

78.0 

81.2 

82, 

83.0 

82.7 

83.5 

84.0 

80.4 

74.8 

73.2 

P8. 2 

on. 8 

53. 2 
50.0 
70.4 
51.0 
4n. 1 
41.7 
50.0 
.52.7 
RO. 7 
64.0 



67.2 
69.0 
69.4 
68.6 
68.0 
65.4 
63.6 
67.5 
69.0 
69.6 
70.8 
72.2 
69.6 
63.4 
32.9 
29.2 
44.7 
37.4 
41.6 
42.0 
40.8 
39.3 
44 2 
48.0 



5; 

28.8 

45. 5 

49.2 

33.5 

41.8 

47.5 

.•"CO 

51.0 

52. 5 

56.3 

60.7 

62.4 

62.8 

63.3 

64.7 

64.5 

59.6 

48.5 

37.3 

41.2 

41.6 

52.1 

61.7 



7.5.1 
S3. 2 
90 
09.1 
101.8 
107.7 
111.2 
112.7 
106.8 
100. 5 
93.2 
83.1 
87.4 
83.9 
79.5 
'.0 2 
70.8 
64.2 
54.1 
50.2 
51,9 
62.4 
84.1 
91.2 



101.4 
108.3 
110.0 
109.5 
110.6 
110.2 
110.9 
110.8 
U'r6. 4 
102.4 
97.1 
93. V 
90.7 
66.6 
'-0.2 
71.7 
71.9 
82.7 
93.7 
100.9 
107.5 
107.8 
109.9 
108.8 



109.2 
103.8 
101.1 
100.0 
100.9 
101 
104.2 
105.8 
105.4 
105.0 
10,5.0 
103.5 
104.3 
101.0 
91.3 
78.0 
75.7 
83.9 
99.6 
103.0 
112.6 
117. ■, 
122.2 
126.1 



1937 



114.4 
126.0 
128.4 
12, 5 



8' 
12' 
l.^'O.O 
1 30. 6 
129.1 
126.0 
125.4 
117.3 

83.5 
113.4 

83.6 

86.0 
110.4 
120.8 
124.9 
123.4 
115. 1 
102.1 

74.5 



1938 



88.6 
79.8 
79.8 
74.3 
75.3 
70.5 
68.8 
68.4 
65. 1 
58. 5 
54.9 
54.9 
52.0 
47.8 
49.6 
56. 8 
62. 6 
?2. 1 
7^.7 
88.0 
92.6 
97.6 

ion. 9 

102. 9 



101.8 

100 

100 
99.3 
99, 
97 

96. 3 
9''i 
89.8 
62.4 
89, 
86.7 
71 

59.5 
65. 
89.4 
97.5 

107.1 
96.0 

102 4 
97.8 

105.9 

113.6 

112.1 



1940 



106 
104.9 
111 
109.9 
110,6 
110.3 
108.3 
108.8 
104.8 
102.6 
102.1 
96.0 
75.0 
64.1 
86.8 
93.4 
102.2 
111.6 
117.3 
120.2 
122. 7 
122^0 
121.5 
121.9 



122.1 
123.0 
122.4 
122.1 
123.6 
122.5 
108.9 
120.3 
123.8 
123,8 
125.7 
119.6 
115.3 
96.0 
107.2 
116.0 
114.9 



NATIONAL DEFENSE MIGRATION 



7153 



Recent estimates of the Michigan Unemployment Compensation Commission 
indicate a current increase in unemployment of about 22,000 workers and an ad- 
ditional 30,000 workers will become unemployed during December and January. 
In addition to this net increase in unemployment many thousands of workers 
will be shifted from nondefense to defense employment during the next 6 months. 
Additional curtailment in the automobile industry or in nondefense manufacturing 
due to scarcity of materials will create additional imemployment. 

Employment on defense production is being expanded as rapidly as production 
facilities can be equipped and made ready but it does not appear that the unem- 
ployed nondefense w^orkers can all be absorbed in defense production before the 
fall of 1942. 

This curtailed employment during the transition period will have a depressing 
effect on the entire community. 

BUSINESS STATISTICS 

Attached is a tabulation of Detroit Business Statistics for the first 8 months 
of 1941 show'ing the percent increase or decrease over the same period in 1940. 
Every factor except Detroit Stock Flxchange sales shows a considerable increase 
over 1940. Estirnates for the next 8 months indicate a decreased volume of 
business close to the 1939-40 pattern. 

Detroit business statistics 



BUILDING AND EEAL ESTATE 

Contracts awarded, Wajme County 
(Dodge Corporation).. . 

Besidential contracts awarded in 37 
States 

Value of building permits— city of 

Detroit 

New buildings 

Residential buildings 

Factories and shops 

Families provided for by new build- 
ings, Detroit 

Water board connections, Detroit area. 

Deeds recorded, Wayne County .-. 

Gas consumption, domestic, Detroit 
gas units . 

Gas meters installed, net, domestic 

GENERAL BUSINESS 

Deliveries of new passenger cars and 
trucks, Wayne County 

Postal receipts, Detroit area 

Bank debits to individual accounts, 
Detroit 

Bank clearings, Detroit 

Department store sales, Detroit 2 

Electric meters installed, net, Detroit 
area 

Telephones installed, net, Detroit area. 

Detroit Stock Exchange: 

Number of shares traded 

Value of shares traded 

BUSrNESS rAILURES — DETROIT AREA 

(Dun & Bradstreet, Inc.) 



Number 

Total assets 

Total Habilities- 



8 months ending 
Aug. 31, 1941 



I $83, 036, 000 

« $1, 154, 043, 000 

$58. 380. 300 
$50, 729, 106 
$40, 951, 974 
$3, 742, 885 

8,517 
9.632 
58, 736 

I 16, 646, 982 
1 +14, 291 



120, 251 
$8, 755, 099 

$10,713,118,000 

$5, 786, 168, 0.58 

1 113 

+25. 680 
+34, 592 

1,496,073 
$12, 827, 609 



136 
$981, 518 
2,011,514 



Percent 
increase 

or 

decrease 

over same 

period 

1940 



+29.8 

+38. 9 

+24.7 

+24.3 

+23.9 

+356. 

+9.5 
+20.5 
+27.0 

+5.1 
+47.2 



+49.0 
+9.5 

+36. 5 
+48.1 
+22.9 

+26.4 
+92.3 

-30 4 
-37.4 



-35.8 
-71.3 
-00.3 



August 1941 



1 $13, 437, 000 

1 $205, 049, 000 

$6, 986, 186 

$5. 757. 186 

$4, 904, 880 

$278, 350 

986 
1,836 
7,694 

11,300,613 
1 +2, 218 



7,187 
$1,042,059 

$1,339,803,000 

$777, 043, 802 

197 



+3, 556 
+4, 768 



207. 222 
$1, 335, 805 



12 
$232, 632 
$402, 442 



Percent increase or 
decrease over 



Last 
year 



+19.4 
+46.0 



+10.3 
+117.0 

-5.2 
+48.5 
+10.4 

+.6 
+93.0 



+28.7 
+7.2 

+43.8 
+41.8 
+36.5 

+16.4 
+74.8 

+5.5. 
-14.3 



-45. 4 
-55.3 
-61.9 



Last 
month 



+9.7 

-.2 

-16.5 
-21.8 
-21.6 
-19.7 

-22.8 
+4.5 
-11.2 

-16.8 
+35.0 



-40 1 
-.2 

-9.6 

-2.5 

-11.8 

-8.5 
+29.3 

.-5.6 
-26.3 



-29.3 

+5».5 

-3.5 



1 July 1941. 

> Index based on 1935-39 daily average equal to 100. 



7154 



DETROIT HEARINGS 

Detroit business statistics — Continued 





Percent 


months ending 
Aug. 31, 1941 


increase 

or 
decrease 




over same 

period 

1940 


118.4 


+18.6 


M73 


+29.0 


« 695, 240 


+24.7 


1 16, 800, 461 


+29.0 


326 


+27.3 


« 3, 790, 476 


+31.8 


201, 543, 166 


+12.4 


1 8, 991, 705 


+28.4 


1+381 


+20. 2 



August 1941 



Percent increase or 
decrease over 



Last 
year 



Last 
month 



INDUSTRIAL 

'Employment index, Detroit area — 
Industrial department estimate — 
average ' 

Wages paid, industrial, Detroit area, 
ba.se period, monthly average, 
1934=100 

Freight cars loaded and received — 
transportation bureau, Detroit area- 
Total in- and out-bound tonnage, 
Detroit area 

Power consumption index, Detroit 
area ' 

Automobile production. United States 
and Canada 

Revenue passengers carried on Detroit 
Street Ry. system 

Gas consumption, commercial and in- 
dustrial, Detroit gas units, Detroit 
area 

Gas meters installed, net. commercial 
and industrial, Detroit area 



111.6 

« 199 

1 94, 639 

I 2, 389, 463 

314 

« 173, 000 

20, 326, 594 

I 1, 162, 041 
1 -104 



+28.7 

+55.5 
+45.4 
+49.1 
+26.2 
+92.7 
-1.7 

+45.1 



+9.6 

+8.2 
-2.9 
-5.0 
+.fi 
-63.1 
-16.2 

-12.9 



1 July 1941. 

' Index based on 1923-25 monthly average equal to 100. 

< Juno 1941. 

« Preliminary. 

Compiled by the Industrial Department of the Detroit Board of Commerce. 



OUT-MIO RATION OF WORKERS 

Detroit has a large mobile labor supply. Workers flow toward Detroit as 
employnient and production increase and many leave Detroit as soon as they are 
laid off. During the next 4 months the trend will be away from Detroit. It is 
difficult to present an accurate estimate of this out-migration but it may easily 
total 10,000 workers. 

DEFENSE TRAINING 

Your committee will have reports from the Training Within Industry Branch, 
Labor Division of the Office of Production Management and the Vocational 
Education Program for National Defense of the Detroit Board of Education. 
Both of these groups have undertaken tremendous training programs to prepare 
Detroit workers for the shift from nondefense to defense production. In addition, 
many of our large industrial institutions have expanded their normal training 
program to meet the training needs of the defense program. All of these training 
activities will have considerable influence on encouraging the unemployed Detroit 
workers to remain in Detroit, and enter training for specific defense jobs. 

DEFENSE HOUSING NEEDS 

Six months ago it appeared that Detroit would have need for a considerable 
increase in residential building to meet the housing requirements of new workers 
that would come to Detroit for jobs on defense production. Detroit's private 
home construction industry undertook a large building program in anticipation 
of that need. 

Today, however, it appears that Detroit will have increasing residential va- 
cancies during the next 6 m.onths. This condition together with the institution 
of priorities for critical materials for defense housing costing $6,000 or less has 
materially reduced residential construction during the past month. The decline 
in residential construction will create some unemployment in the building trade 
as soon as construction programs now in process are completed. 



NATIONAL DEFENSE MIGRATION 



7155 



However, we contemplate a continuing review of the facts relative to Detroit's 
housing supply, increases in employment, unemployment figures, and residential 
construction so that our housing needs can be forecast well enough in advance to 
meet the needs of the community. 

The Federal Government has allocated 1,000 defense housing units to the 
Detroit area. The city of Detroit has established a homes registration bureau to 
register available dwelling units for rent and to receive application from workers 
for rental units. The rent index for Detroit on August 15, 1941, was 112.4. This 
compares with a rent index of 114.8 on December 15, 1937, and 143.4 in December 
1929. 

Attached is the cost of living index for Detroit as reported by the United States 
Bureau of Labor Statistics. 

Cost of living in Detroit — Indexes of the cost of good'i purchased by wage earners and 

loioer-salaried workers 

[Average: 1935-39=100] 



Date 


All items 


Food 


Clothing 


Rent 


Fuel and 
light 


House 
furnish- 
ings 


Miscella- 
neous 




69.1 

71.4 

83.4 

101.2 

120.9 

141.7 

163.2 

150.9 

127.5 

124.6 

129.4 

127.3 

132.1 

129.2 

125.5 

123.9 

124.7 

113.3 

98.7 

86.2 

83.5 

87.6 

91.2 

95.5 

99.5 

105.3 

106.4 

103.0 

100.7 

99.8 

99.1 

100.2 

99.8 

99.9 

100.9 

100.5 

100.6 

100.4 

100.9 

101.0 

101.1 

102.1 

103.4 

103.4 

106.4 

107.0 

107.4 


81.3 

84.5 

101.2 

126.8 

148.4 

163.7 

199.6 

144.5 

123.0 

119.8 

122.6 

122.9 

141.9 

137.7 

132.1 

129.6 

133.0 

112.5 

90.7 

73.8 

78.2 

85.4 

91.0 

99.4 

101.1 

109.3 

103.8 

99.8 

96.0 

94.0 

92.4 

96.2 

94.1 

94.5 

98.3 

96.0 

95.5 

94.8 

95.8 

97.0 

97.2 

98.4 

101.3 

100.7 

107.0 

107.2 

107.1 


68.8 
70.4 
81.8 
101.0 
147.1 
193. 9 
212.5 
190.0 
132.5 
123.8 
127.5 
121.2 
120.3 
117.7 
112.9 
111.8 
111.3 
103.4 
91.6 
86.6 
83.3 
94.4 
97.1 
96.2 
98.5 
102.4 
105.9 
102.0 
100.9 
100.8 
100.9 
100.1 
101.7 
102.0 
101.8 
101.2 
101.6 
101.6 
101.9 
100.0 
100.1 
102.6 
102. 6 
102.7 
103.2 
105. 
106.0 


80.7 
82.3 
94.8 
106.9 
112.1 
129.2 
136.1 
167.8 
154.1 
154.9 
167.4 
164.4 
159.5 
157.7 
148.5 
143.7 
143.4 
129.0 
105.7 
81.5 
71.5 
67.6 
75.3 
85.0 
99.8 
107.4 
114.8 
111.2 
109.1 
108.4 
108.0 
107.8 
107.8 
107.9 
107.7 
107.9 
107.9 
107.9 
108.5 
108.5 
108.7 
109.1 
109.7 
110.0 
110.6 
112.1 
112.4 


67.7 

68.8 

74.4 

88.1 

99.9 

106.9 

118.4 

138. 4 

120.2 

132.3 

125.2 

123.7 

136.1 

126.4 

119.7 

119.8 

120.2 

115.8 

107.8 

99.6 

93.1 

100.3 

102.5 

104.7 

100.2 

97.9 

99.8 

95.7 

98.7 

98. 7 

96.5 

97.5 

98.9 

98.8 

97.0 

98.9 

99.1' 

99.2 

99.4 

97.9 

98.3 

98.3 

98.3 

99.8 

101.9 

102.2 

104.2 


62.1 

67.5 

77.3 

93.4 

128.7 

169.2 

190.4 

176.3 

122.2 

112.4 

127.4 

123.0 

120.2 

117.1 

114.7 

112.5 

111.4 

103.4 

92.7 

82.1 

81.3 

91.0 

94.4 

94.7 

97.3 

104.4 

107.4 

102.2 

101.2 

101.3 

101.5 

101.3 

102.8 

100.3 

99.5 

99.2 

99.6 

99.6 

99.4 

99.2 

99.2 

102.7 

103.1 

103.5 

106.4 

109.0 

109.8 


48.0 




49.7 


1916 December 


58.7 




72.0 


1918 December 


82.9 




96.1 


1920, June ..- - 


115.9 




117.2 


1921, December 


110.8 


1922 December - - 


106.4 


1923, December 


109.7 


1924. December - 


108.3 


1925, December ..- 


106.9 


1926, December 


106.4 




109.6 




111.0 


1929, December - --- 


110.7 


1930 December . - 


108.1 


1931, December .. ■ --- 


104.7 


1932, December . 


101.2 


1933, June - - 


96.4 




97.8 


1934, Nov. 15 


96.8 


1935, Oct. 15 


95.9 


1936, Dec. 15 


98.1 


1937, June 15 . 


102.4 


Dec 15 


105. 2 


1938, June 15 


103.2 


Dec. 15 - - 


100.7 


1939, Mar. 15 


100.2 




100.2 


Sept. 15 


99.9 


Dec 15 


99.8 


1940, Mar. 15 ._ 


99.9 




99.9 


Sept. 15 


100.7 


Oct. 15 


101.6 


Nov. 15 


101.6 


Dec. 15 


101.8 


1941, Jan. 15 -- 


101.8 


Feb. 15". 


101.8 


Mar. 15 


102.2 


Apr. 15 


103.1 


May 15 


103.1 




105.2 


July 15 


105.0 


Aug. 15 


105.0 



Source: U. 8. Bureau of Labor Statistics. 



Also attached is a tabulation showing the value of building permits issued by 
the city of Detroit on a monthly basis during the past 5 years. 



7156 



DETROIT HEARINGS 

Value of all building permits, Detroit 



January... 
February. 

March 

April 

May 

June 

July 

August 

September 

October 

November. 
December - 

Year 



$6, 057, 879 

5, 533, 315 
11,917,635 
11,548,340 
11,209,318 

9, 564. 058 
10,913,415 
9,823,611 
9, 928, 308 

6, 767, 971 
4,880,017 
2, 398, 630 



100, 542, 497 



$2,998,107 

3, 795, 556 

5, 350, 051 

4, 694, 965 
3, 203. 126 
7, 940, 750 

6, 680, 969 

5, 747, 161 
3, 600, 779 
3, 419, 2f.O 
3, 169, 046 
2, 304, 140 



52, 909, 940 



1938 



.$2, 183, 8.36 
1, 988, 862 
3, 291, 544 
3, 989, 000 

3, 984, 634 

4, .533. 441 
4, 573, 852 

4, 777, 237 
5,913.840 
7, 226, 310 

5, 079, 201 
3, 888, 014 



51, 430, 371 



1939 



$.3,410,949 

3, 358, 676 
5, 807, 144 
5, 288, 482 
5,647,831 

5, 656, 736 
5,851,306 
5,465,940 
5, 140, 693 

6, 888, S93 
5, 133, 572 

4, 007, 877 



61, 664, 099 



1940 



$3, 025, 004 
3, 70S, 089 
5, 628, 631 
7, 627, 877 
7, 319. 220 

5, 405, 305 

6, 727, 979 

7, 372, 271 
7,413, 139 
7, 656, 630 
6, 523, 875 

12, 729, 713 



81, 138, 733 



1941 



$4, 369. 850 

5. 525, 872 
9. 100,909 
9. 054, 527 
6,611,020 
8, 359, 295 
8, 372, 641 

6, 986, 186 



A brief summary of present and near future conditions in the Detroit industrial 
area might be as follows: There will be increasing unemployment resulting from 
shortages of critical material and the conversion of Detroit industry from non- 
defense to defense production. Detroit industry is making and will continue to 
make every effort to speed up employment and production of defense material. 
Employment on nondefense will be maintained at as high a level as possible in 
proportion to the amounts of critical materials that can be released for non- 
defense production in order to cushion employment during the transition period. 
Defense training programs will be increased and are expected to have considerable 
influence on encouraging unemployed workers to remain in Detroit and train for 
specific defense jobs. Workers leaving Detroit during this transition period will 
probably return to Detroit when called by their former employer because wage 
rates in industry in the Detroit area are higher than any other large industrial area. 

Detroit is deeply concerned about the current problems incident to the transi- 
tion from nondefense to defense production. Howver, we are even more con- 
cerned about the problems that will confront Detroit and the entire country at 
the end of the defense-production period. We can foresee greater economic 
dislocations with its resulting unemployment, hardship, and suffering for thous- 
ands of our citizens unless we plan now to meet the problems that will confront 
Detroit and the country when we shift back to normal domestic production. 

We are hopeful that the studies of this committee may aid in formulating some 
program to meet those problems. 



TESTIMONY OF WILLIS HALL— Resumed 

Mr. OsMERS. You state in your paper, and I quote you: 

It does not appear that the unemployed nondefense workers can all be absorbed 
in defense production before the fall of 1942. 

Mr. Hall. That is correct. 

Mr. OsMERS. That is about a year from now? 

Mr. Hall. That is right. 

Mr. OsMERS. Could you just give us vour reasoning leading up to 
that? 

Mr. Hall. That statement is predicated upon the proposition that 
you are going to curtail automobile production 48 percent in December, 
and possibly more afterward. Our present schedules for defense pro- 
duction just can't be stepped up in many of the larger defense plants. 
They can't get all the tools and machinery and equipment ready, they 
can't get production rolling fast enough to absorb those men at the 
time that they are laid off. 

Mr. OsMERS. It is going to be a question of timing? 

Mr. Hall. Absolutely, a question of timing. 



NATIONAL DEFENSE MIGRATION 7157 

Mr. OsMERS. You feel hopeful that m a year, if the present arc of 
defense work continues, the employment situation will catch up with 
itself? 

Mr. Hall. That is right. 

Mr. OsMEES. Now, you also say that this curtailment will have a 
very depressmg effect on the entire community? 

Mr. Hall. Can't help it. 

Mr. OsMERS. You expect m the next 6 months a volume of busi- 
ness close to the 1939-40 pattern. Would you consider that a 
depressed standard — the 1939-40 period? 

BUSINESS CURVE 

Mr. Hall. It certainly would be depressing compared with what 
we had during the last 9 months. Of course, in 1939 and 1940, we 
thought we were having good business; and then 1941 came along 
and business rose anywhere from 10 to 30 percent above the 1940 
pattern, and now it appears that we are going to have this tremendous 
temporary unemployment, depressed pay rolls, depressed production 
of all items. We just won't have the buymg power in the com- 
munity to mamtain the level that we have had during the past 8 
months, 

ANTICIPATED UNEMPLOYMENT FOR DETROIT 

Mr. OsMERS. I think the most mterestmg figures in your paper are 
your estimates of a current increase of 22,000 unemployed now, and 
30,000 more becoming unemployed during December and January. 
Mr. Lovett uses the figure ''115,000." 

Mr. Hall. That is for the State. 

Mr. OsMERS. I presume your figures are for the city of Detroit? 

Mr. Hall. Yes; and ours were taken from a preliminary survey 
made by the Michigan Unemployment Compensation Commission. 
You will hear Mr. Stanchfield, the expert on that, this afternoon. 

Mr. OsMERS. There is a story current in Detroit that you need a 
$10,000,000 public works program, and the Detroit officials estimate 
that 40,000 W. P. A. workers will be needed, as against 12,000 on the 
rolls today. Do you care to comment on that estimate? 

TRAINING PROGRAMS 

Mr. Hall. Well, I doubt. Congressman, that 40,000 people will go 
down immediately and apply for W. P. A. Remember that each of 
these large industries is at the present time engaged in a tremendous 
retraining program to fit the nondefense worker to take on the defense 
job. In addition to that, you have the training program through 
the school system. They have, I believe, about 15,000 people in 
various stages of defense training in the school system today. And 
then you have the other program of training within industry, under 
O. P. M., and that is spreading down through many of the smaller 
industries. 

Mr. OsMERS. So it is not your opinion, summing it up, Mr. Hall, 
that everyone who becomes unemployed in the next 4 or 5 months is, 
of necessity, going to go right down to the W. P. A. office and apply for 
employment. 



7158 ' DETROIT HEARINGS 

Mr. Hall. No. You will have certainly a material increase in 
the applications for relief and W. P. A. but 

Mr. OsMERS. But you don't feel it would reach from 12,000 to 
40,000? 

Mr. Hall. I don't see how it could. 

Mr. OsMERS. What have been the effects on the city of Detroit of 
the large number of people who live in Detroit when they have a job 
in Detroit and who migrate elsewhere when they are unemployed? 

BUSINESS FOLLOWS SAME CURVE AS EMPLOYMENT INDEX 

Mr. Hall. Well, generally, you can figure that the whole economic 
condition of Detroit swings up and down with the employment index 
of Detroit's industry, because our whole economic structure is based 
upon the pay rolls of the community. As those pay rolls go up, 
generally business goes up; when they go down, business follows. 

Mr. OsMERS. These people who leave Detroit when they are un- 
employed, where do they go? 

Mr. Hall. There was a map, Congressman, prepared in 1939 and 
published in one of your committee's reports, which showed the out- 
migration from Michigan, and it indicated the unemployed Detroit 
workers went to every State in the Union. ^ 

Mr. OsMERs. Do you feel unemployment-compensation payments 
have retained workers in Detroit, or helped to retain them here? 

Mr. Hall. Not necessarily. If a worker is laid off here and can go 
back to Kentucky, Indiana, Ohio, or any other State where he might 
find cheaper living in smaller communities, he will do that. 

Mr. OsMERS. Did these men come here primarily to help with new 
automobile models? 

Mr. Hall. There is an accumulation of men who have come into 
Detroit year after year for the past 10 or 15 years. 

Mr. OsMERs. For that purpose? 

Mr. Hall. Largely in the automobile industry. 

Mr. OsMERS. Do they consider themselves residents of Detroit? 
Do they vote here, and maintain residences here, and do they send 
their children to school here? 

Mr. Hall. Wliile they are here most of them do. 

Mr. O.SMERS. On the citizenship or residence question: Do they 
consider themselves Detroiters? Or Kentuckians or Tennesseans? 

Mr. Hall. I think the great majority consider themselves De- 
troiters — part of Detroit and Detroit's industry. 

Mr. OsMERs. I am wondering what they are from a census stand- 
point. 

EXPECTED OUT-MIGRATION 

Mr. Hall. They were counted here. 

Mr. OsMERs. Now, unquestionably, as the defense program devel- 
ops, and particularly when the full blow of automobile curtailment i& 
felt in the Michigan area, you are going to lose workers here. You 
are going to lose skilled workers from the State of Michigan. They 
are going elsewhere. 

Mr. Hall. We anticipate that. 

1 See H. Kept. No. 369, Report of the Select Committee to Investigate the Migration of Destitute Citizens, 
p. 496-F. 



NATIONAL DEFENSE MIGRATION 7159 

Mr. OsMERS. They are coming to my State of New Jersey and 
making airplane motors, and to other places to make guns or some- 
thing else. Now, are your industrialists preparing some system for 
bringing those men back? Are they making records of them, where 
they go and so forth? 

EXPECT TO KEEP SKILLED WORKERS 

Mr. Hall. We doubt, first, Congressman, that we will lose a lot of 
skilled men. 

Mr. OsMERS. You doubt that? 

Mr. Hall. Skilled operators. We believe it is inevitable that we 
will lose common laborers and unskilled or semiskilled labor. But 
certainly every effort is going to be made to maintain and to keep 
within the area all of the skilled operators we can possibly keep here. 

Mr. OsMERS. W^iat is your situation with respect to skilled labor? 
Is there a shortage? 

Mr. Hall. In some categories. 

Mr. OsMERS. Chiefly what? 

Mr. Hall. Mr. Calm here, I think, probably could give you 
more information on the skilled trades shortages. 

TESTIMONY OF CHESTER A. CAHN, SECRETARY, AUTOMOTIVE 
TOOL AND DIE MANUFACTURERS ASSOCIATION, DETROIT, 
MICH. 

Mr. OsMERS. What is the situation, Mr. Calm? 

Mr. Cahn. I think we will need skilled workers. There is a dehnite 
shortage in almost all categories. 

Mr. OsMERS. We shall incorporate your paper mto the record, Mr. 
Cahn, at this point. 

(The paper referred to above is as follows:) 

STATEMENT BY CHESTER A. CAHN, SECRETARY, AUTOMOTIVE 
TOOL AND DIE MANUFACTURERS ASSOCIATION 

The automotive tool and die industry in Detroit embraces slightly in excess 
of 200 jobbing shops with employment capacities varying from 10 to 500. The 
industry is engaged principally in the manufacture of special tools, dies, jigs, 
fixtures, gages, and special machinery. Its facilities are used by producers in 
high quantities of metal goods, namely, manufacturers of automobiles, auto- 
motive parts and equipment, stoves, refrigerators, tractors, and others. 

The demands of the automobile industry require a close association between 
the purchaser of tools and the supplier and close proximity of the two are essential 
to efhciencv and satisfactory results. 

Most of the tools and dies required by the automobile industry are designated 
for the purpose of model changes, and are usually scheduled for delivery prior 
to a dead-line date of August 1. At peak, a tooling program uses the total tool 
and die manpower of the industry. Time occupied in producing tools for model 
changes, and employment levels vary in accordance with the magnitude of the 
model change. Extensive changes are accomplished by starting worlv as early 
:as January 1, and by operating upon a schedule of overtime hours. 

RELATION TO DEFENSE 

Almost 100 percent of the facilities of the industry are now engaged in defense 
work for the arsenals, aircraft manufacturers, aircraft engine manufacturers, 
automobile manufacturers, tank manufacturers, and machine tool manufacturers. 
The industry is operating upon an overtime basis. 



7150 DETROIT HEARINGS 

It must be explained that the use of facilities is limited to some extent because 
there is not sufficient skill to operate all plants on multiple shifts. 

EFFECT OF CURTAILMENT 

Quantity of production does not bear directly on the number of tools and dies 
needed for manufacture, but determines the structure and wearing surfaces. 
After new models are put into production very little of the tool and die industry 
is required to supply the needs of the automobile industry. Facilities of the 
captive shops are usually more than adequate to rebuild the tools or dies required 
as a result of break-downs or engineering changes. Curtailment of production 
will have little effect on the tool and die industry. 

THE EFFECT OF FREEZING MODELS 

The question of whether or not the freezing of models will release tool and die- 
makers for the defense program will depend upon the requirements of the pro- 
gram at the time of the year ordinarily given to model changes; namely, the first 
6 months. 

Since much of the manpower and a large percentage of the industry are, and 
have been, devoted to the making of dies, employment of these facilities will 
depend upon the quantity of dies required henceforth for the defense. It is 
highly probable that much of the equipment, particularly adapted to die manu- 
facturing, will become idle. 

MIGRATION 

A cross section check of the industry indicates that slightly in excess of 2 per- 
cent of the manpower engaged in the independent plants have migrated from 
other areas within the past year. 

An accurate check of those who have migrated away from this area is not 
available but it is doubtful the total equals 1 percent. 

TOTAL EMPLOYMENT 

The automobile manufacturers, body manufacturers, automotive parts and 
equipment manufacturers, and automotive tool and die manufacturers, in the 
Detroit area, employ a total of 20,581 men in tool and die departments, exclusive 
of apprentices. 



TESTIMONY OF CHESTER A. CAHN— Resumed 

Mr. OsMERS. Are your figures at variance with those of the labor 
unions? We have had an amazing experience in this committee. We 
have had one witness follow another, with the manufacturer or 
employer saying there is a definite shortage of skilled workers, and the 
labor man immediately contradicting him. 

Mr, Cahn. Well, my figures may be at variance with those of 
labor, but I can show evidence of the fact that there is a desire at the 
present time for skilled workmen. 

Mr. OsMERS. That there are jobs open? 

Mr. Cahn. There are lots of employment opportunities for skilled 
workers. Do not understand me to mean all classes of skilled workers. 
I understand there are pattern makers out of employment, although 
I have been told that there are opportunities in the shipyards for 
pattern makers. The probability is that there won't be too many 
opportunities for pattern makers so long as new models or the present 
automobile models are frozen, because a lot of pattern makers have 
been developed to build patterns for the automobile model changes. 
In referring to pattern makers, of course, I am referring to a very 
limited group of men. I don't know how many there are. I under- 
stand about 500. But that is the only skilled group with which I am 
familiar that has limited opportunities for employment. 



NATIONAL DEFENSE MIGRATION 7161 

A great many of these men have the abihty to do other work. As 
a matter of fact, I understand that Briggs Maniifacluring Co., which 
is making airplane fuselages and wings, has developed a pattern- 
making technique to assist them in maintaining models and bringing 
about changes in models. 

ONE HUNDRED AND THIRTY THOUSAND DEFENSE WORKERS IN DETROIT 

AREA 

Mr. OsMERS. I see. Now, getting back again, Mr. Hall, to this 
Detroit situation: There are, I believe, 130,000 defense workers in 
the Detroit area now. Does that figure about jibe with yours? 

Mr. Hall. It was taken from the Stanchfield report.^ 

Mr. OsMERS. Yes. 

Mr. Hall. I think that is substantially correct. 

Mr. OsMERS. How many of those are employed by automobile 
manufacturers in defense? 

EIGHTY-ONE THOUSAND AUTOMOBILE WORKERS IN DEFENSE 

Mr. Hall. The Stanchfield report indicated, as of November 30, 
48,000 would be employed by the 5 principal automobile producers 
and the 33,000 additional would be employed by the automobile 
suppliers, which would be a total of 81,000. 

Mr. OsMERS. Out of 130,000? 

Mr. Hall. Yes. 

Mr. LovETT. I would like just to put in one more word on this 
future of employment. 

Mr. OsMERS. Please do. 

COST PER POUND OF INDUSTRIAL PRODUCTS 

Mr. LovETT. Your skilled labor, of course, is going to become in- 
creasingly scarce, because an automobile, for instance, sells for 25 
cents a pound, while a tank like Chrysler is making, I think, sells for 
much more — perhaps $2 or $4 a pound; the Bofors machine gun sells 
for about $5 a pound ; and Pratt & Whitney engines or Wright Cyclones 
sell for about $25 a pound. That is skill. That is all skilled labor in 
there. 

Mr. OsMERS. That is the factor that makes the difference? 

Mr. LovETT. Yes; that is the factor that makes the difference in 
cost. 

Mr. OsMERS. There is just as much material in a pound of auto- 
mobile as there is in a pound of airplane motor, but the degree of skill 
is greater? 

Mr. LovETT, That is right. And that is a pretty good basis for 
you to chart your future use of skill. 

Mr. OsMERs. Do you expect, Mr. Lovett, any substantial reduction 
in the cost per pound of airplane motors as we really swing into mass 
production on them? 

Mr. LovETT. I think you will get some decrease in cost, but not a 
great deal. Labor is a very important factor, and those motors are 
all very close-limit jobs, as you know. They are precision jobs, to 

J See p. 7189. 



7162 DETROIT HEARINGS 

two ten-thousandtlis of an inch, and that is close work. And that is 
where your cost comes in. The material is no higher priced than the 
material that goes into an automobile. 

Mr. OsMERS. Yes; I guess that is true. Now, Mr. Hall, do you 
think that multiple-shift operations will have the effect of keeping 
your workers here in Michigan? 

Mr. Hall. Could have. That would be, of course, a matter largely 
of negotiation between plant manasiement and the unions. 

Mr. OsMERS. What are the possibilities in that respect? Are most 
of your defense plants now working multiple shift? 

MULTIPLE SHIFTS 

Mr. Hall. It depends on the volume of business they have. If 
they are loaded up, they are working three shifts, 24 hours a day and 
7 days a week. 

Mr. OsMERS. Certainly that would be a much better solution — 
the multiple shift plan — than having men traveling all over the country 
seeking employment. 

SENIORITY AS AID TO RETENTION OF SKILLED WORKERS 

Mr. Hall. Mr. Congressman, the 0PM Committee that has been 
meeting here in Detroit for the past 2 weeks is trying to work out a 
way of preventing loss of skilled workers. Under this plan, the first 
men to be transferred from nondefense to defense within the plant 
that has the defense contract will be the oldest, those with greatest 
seniority; and then, after those, the men who are qualified for the 
job — for the new defense job; after that, they are trying to establish 
that other defense contractors, seeking additional help, will apply 
to the Michigan Placement Service, and men will be taken from those 
still remaining on nondefense with the greatest amount of seniority 
and qualifications for the new defense job. That will have an in- 
fluence in helping retain our skilled workers in the area. 

fears for AUTOMOBILE DECENTRALIZATION 

Mr. OsMERS. Is there any concern in Michigan about the spreading 
out of all these mass-production industries, and is there any fear that 
it may lead to a decentralization of the automobile industry? 

Mr. Hall. We at the board of commerce are greatly concerned about 
that problem. You can understand that when we have five or six 
billion dollars of additional plant — defense-plant facilities being created 
and tooled up and machined throughout the United States — when this 
thing is over, many of those plants with excellent machine-tool 
capacity will be in areas with a much lower wage schedule than the 
Detroit area and the southeastern Michigan area, and you can also 
appreciate that after the defense emergency is over, there is going to be 
a period of tremendous competition, in which business is going to the 
producer who is able to produce the best product at the lowest price 
and get the greatest distribution; so that ahead of Detroit lies a period 
when we are going to have to do a tremendous job of planning today, 
and from today on, to meet the problems that are going to come up 2, 3, 
4, or 5 years from now. 



NATIONAL DEFENSE MIGRATION 7163 

Mr. OsMERS. I think, of all of the things that we have considered 
here this morning, that that probably is fraught with the greatest 
danger to all parts of the country. 

Mr. Hall. Much more serious than this temporary change-over 
picture. 

Mr. OsMERS. And that is serious enough. Because these huge 
plants that you and I see ah over the United States, building motors 
and airplanes and everything else, certainly will be able to make auto- 
mobiles if they make enough money during the war to tool them up, 
and they probably will. 

Mr. LovETT. They will be for sale cheap. 

The Chairman. You lead the Nation now in automobile produc- 
tion, and you may have to take to the air. 

Mr. LovETT. I think we will, Congressman. 

Mr. Osmers. New Jersey will take care of that. 

Mr. LovETT. That is what California is afraid of, Mr. Congressman. 

Mr. Hall. I don't think there is any question that through the 
entry of the productive skill of the automotive industry into air- 
craft, we are going to find ways to produce airplanes and airplane 
engines at much less cost than in the past. 

Mr. Osmers. Do you think the so-called seepage-down process will 
help some of these subcontractors to become prime contractors? 

farming-out of defense contracts 

Mr. Hall. I am entirely in agreement with the statemnt of Mr. 
Lovett. If you gentlemen could appreciate the tremendous farming- 
out organization that the automotive industry has, you would under- 
stand what we mean. I think Mr, Lovett said in his statement, for 
instance, that the Ford Motor Co. has 7,000 supphers. Now, the 
engineering and purchasing departments of the Ford Motor Co. know 
immediately what each of those 7,000 firms are able to produce. 
They know the tools they have on hand; they know the management's 
skill and ability; and certainly they are in much better position to 
farm that production, down to the person who is best able to produce 
it in the shortest possible time. I entirely agree with Mr. Lovett's 
suggestion that if the purchasing agencies of the Army and Navy and 
Air Corps and all other governmental agencies would spread the con- 
tracts and the blueprints and specifications out to Detroit as soon as 
they spread them in Washington and other places, we could probably 
step up the farming-out process much faster than any other method 
you could devise. 

Mr. Osmers. In other words, it will have to come from the top 
and then depend upon the pressure to shoot it out at the bottom. 

Mr. Hall. Let me give you a definite example of that. The 
Continental Motors is producing an aircraft engine for the tanks 
that are bemg manufactured here. They received requests some few 
weeks ago to step up production. Immediately they realized they 
were going to need help to do it. Consequently, they have been 
farming out much of their work, and they will have to farm out 
much more, so through the defense contract service office they have 
set up an exhibit of 50 different pieces of that engine, and have 
invited 600 Detroit and Michigan manufacturers to look at that 
exhibit and see what they could produce. As a result, they were 
able to find production facilities and farm out the work. 



7164 DETROIT HEARINGS 

Now, today, in that same office they have three separate defense 
contractors, with exhibits, and there is a constant stream of Detroit 
and Michigan manufacturers, going in and looking at the pieces, 
seeing what it wiU require to produce them. If they can produce 
them, there is an order, and they go to work on it; and I think a 
considerable improvement certainly has taken place in the last 
couple of months in the farming-out process. 

Mr. Cahn. I would like to express the same point of view, but from 
a different angle, in connection with the large manufacturers who are 
subcontracting the work. 

DIRECT SUBLETTING BY MANUFACTURERS ADVOCATED 

The majority of those 7,000 suppliers that Ford has on his list 
would rather deal with Ford because in the first place they want the 
goodwill of the Ford Motor Co. Secondly, and verj^ important, a 
committee went to the office of contract distribution, as a result of an 
investigation from Washington, and we looked at the equipment 
they had, and we were advised by the agents there that the blue- 
prints and that equipment "may be sent to 1 or 1,000 suppliers." 

Well, of course, the man who does the estimating from those blue- 
prints is one of the most important men in the organization of any of 
these shops. His time is valuable, and supposing that one item of 
$5,000 went to 1,000 firms, and was estimated by 1,000 estimators, 
you can well understand that the cost of estimating it would be many 
times the cost ot that article. 

Now, that isn't the ordinary practice in the automobile companies. 
They have five or six companies that will build that particular item, 
and they will send their blueprints and specifications to those five or 
six companies. Consequently, instead of 1,000 highly paid and 
important estimators, estimating on 1,000 blueprints for a $5,000 job, 
here are only 5 or 6 estimators. 

Mr. OsMERS. I can easily see how the cost of estimating any 
complex article might exceed the cost of the article itself if you carried 
this process out to a ridiculous extreme, 

Mr. Cahn. That is right. 

Mr. OsMERS. Now, to go into another subject. We have learned 
that 45 percent of the revenue of Wayne County is distributed to the 
rest of the State. Is that right, Mr. Hall? 

WAYNE COUNTY PAYS MORE THAN ITS PROPORTIONATE SHARE OF TAXES 

Mr. Hall. I don't understand that formula, Congressman, The 
formula that we complain about is that 50 or 60 percent of all the 
State revenues come out of business and industry and the individual 
in Wayne County, and our complaint is that we get back through the 
distribution of State aid only about 30 or 35 percent of the total State 
distribution. That differential between what we pay in and what we 
don't get back is what we are complaining about. 

Mr. OsMERS. That is, it is distributed among the less prosperous 
counties of the State? 

Mr. Hall. That is correct. 

Mr. OsMERs. I think every State in the Union has that complaint. 

Mr. Hall. Yes; Chicago and New York and all the other big cities. 



NATIONAL DEFENSE MIGRATION 7165 

Mr. OsMERS. After this defense program is over, undoubtedly a 
good many people who have come to Detroit to participate in it will 
return to the States and counties from which they came. Will that 
have the effect of easing Detroit's burden? 

Mr. Hall. Somewhat. That is our usual experience. It may 
create a relief problem in the Upper Peninsula. In many smaller 
communities it may accentuate the relief problem. 

Mr. OsMERS. There has been a great deal of talk and rumor about 
the bottleneck in machme tools m the United States. Do you feel 
that we have not developed our machme tool facihties to their fullest 
extent? 

PRACTICES LEADING TO LABOR PIRACY 

Mr. Cahn. I think the machme tool people have done quite a job, 
although I do feel that perhaps they have been a little careless in the 
issuance of priorities on machine tools. As you probably know, there 
is a decided lack of skilled labor here in Detroit, particularly in con- 
nection with the making of gages, which calls for a high degree of 
skill. Recently machines have been released to Detroit, to develop 
new companies for the manufacture of gages. It doesn't seem 
reasonable, in view of the fact that we haven't men enough to man the 
machines we have now. If those machines were issued or given out 
to develop and round out the companies that are now operating, they 
would serve a useful purpose, but I think that they are really lost 
because the men who operate those machines must be taken from 
somebody else. 

Mr. OsMERS. You mean it is gomg to lead to labor piracy? 

Mr. Cahn. It has led to labor piracy. 

Mr. OsMERS. And not increased production? Does it mean that 
they are just going to be shufHing the people around, and will it lead 
to rather unhealthy labor and business situations, steahng men from 
other industries? 

Mr. Cahn. Yes, sir; it has led to that. I have one mstance in mind. 
A new plant started, and it took the entire second shift from another 
plant that was making gages entirely for defense. 

Mr. OsMERS. What proportion of these tool and die people have 
been working on automobile production during the last 6 months? 

Mr. Cahn. Oh, quite a considerable number of die people. 

Mr. OsMERS. I just have one more question, Mr. Chairman, and I 
will direct it to one or all of the gentlemen here. Would you care to 
make any comment or any suggestion on the Governmnt's labor policy 
with respect to these defense industries? Don't all speak at once. 

Mr. LovETT. We might like to, but whether we should or not is 
another matter. 

Mr. OsMERS. I will leave it entirely to you. If you care to put any- 
thing in the record or make any suggestions with respect to improv- 
ing it, I would like to have them. 

DEFINITE LABOR POLICY NEEDED 

Mr. LovETT. I would be willing to say this: I think the Govern- 
ment must get a labor policy pretty soon. 
Mr. OsMERS. A book of rules? 
Mr. LovETT. Yes. 



7166 DETROIT HEARINGS 

Mr. OsMERS. That everybody should follow — labor and employers 
together? 

Mr. LovETT. That is right. As it is now nobody knows what is 
gomg to happen or what decision they may make in one case as opposed 
to another case. 

I think the shipbuilding case is a good pomt. They got themselves 
out on a limb and now they are scrambling around trying to get back 
somewhere. I think they would have been wise if they had done as 
in the last war— said at the very beginnmg of the defense program 
that the status quo shall be maintained and that they would not use 
the defense program as a means of promoting either side. 

Mr. OsMERS. Have you found evidence, Mr. Lovett — or again, 
any of you gentlemen — that the Government has been using the 
defense program as a lever to bring about social objectives that they 
may have in mind? 

Mr. Lovett. That has been the complaint. I don't know that 
I would phrase it just that way, Congressman. I would say that the 
lack of a policy by the Government has caused some labor leaders to 
take advantage of the situation and try to bring out things that they 
couldn't otherwise have brought about except under the pressure of 
the defense program. There is a lot of comment, prejudiced or not, 
that the important thing in the minds of some of the gentlemen who 
are running the defense program is social changes, ahead of defense 
production. That comment is heard frequently. 

LABOR agreement FOLLOWED BY STRIKE 

Mr. OsMERS. In company with the rest of the committee, I visited 
the Federal Shipbuilding & Dry Dock Co. in Camden, shortly before 
the strike there, not because there was going to be a strike, but because 
it was an important defense point; and my recollection is that all the 
shipyards on the eastern coast had entered into an agreement that was 
satisfactory to labor and governed wages, hours, and conditions of 
. mployment. It came as rather a shock, at least to me as a member 
ol the committee, on the heels of that to find this strike, which strikes 
at the very heart of our defense program, right at the first line of our 
defense. Isn't it your understandmg that that agreement had been 
negotiated, providing that there would be no strikes and that both 
labor and industry were satisfied? 

Mr. Lovett. That is exactly right. I understood they had an 
agreement and that all of these questions had been settled or were to 
be taken up through mediation, without first striking. They were to 
take them up ahead of a strike. 

The same thing is true, more or less, on the Pacific coast. 

Mr. OsMERS. I think the tragedy of the situation is demonstrated 
by the young woman who was before the committee this morning. 
The strike in Muskegon is going to be mediated by a Government 
body anyway, but they are going to be depiived — those strikers — of 
food and shelter while steps are being made to settle their differences, 
and it is rough on the workers, very rough. 

Mr. Lovett. Well, I agree with what she said about it. I think 
that is our experience. I don't believe they gain anything by the 
strike — not nearly as much as through the mediation process without a 
strike. 



NATIONAL DEFENSE MIGRATION 7167 

We have had two or three strikes here in Detroit with which I am 
quite familiar. One case was a brass company. The Federal media- 
tion board set a wage scale for the Waterbiiry, Conn., brass industry — • 
that whole east coast brass industry. This particular firm in Detroit 
is paying 7 cents an hour above that wage, set by the Board, and yet 
the men went on strike. Three hundred and some out of one thousand 
voted for a strike for 25 cents an hour increase, when their pay was 
7 cents above the rate set by the mediation board. 

Mr. OsMERS. The general public's concern, fiom my personal 
experience with it, has not been so much with the strike that is caused 
through a desire to obtain certain hours or increased wages, but with 
the strike that seeks to do neither of those things, but to work out some 
other objective 

Mr. LovETT. Closed shop, check-off, or something else. 

Mr. OsMERS. Everybody who goes into a grocery store or a meat 
shop knows that the costs of living are increasing sharply, and we know 
there are going to have to be increases in wages in many instances, but 
I hate to see all of the gains of those increases in wages lost through a 
period of 3 or 4 months of strikes before they get the increased wages. 

Mr. LovETT. I agree with you. I think that the public's reaction 
is just as you say. 

The Chairman. Gentlemen, there is no use saving this Nation the 
first morning of our hearing. We have more witnesses to hear to- 
day — some very important witnesses — and we want to thank you very 
much for appearing here. We probably could sit days or weeks, dis- 
cussing the problem before us; but I want to say again that we ap- 
pi'eciate the contribution which you have made to the committee. 
We still stand adjourned until 2 o'clock. 

(Whereupon, at 1:40 p. m., the committee recessed until 2 p. m.) 



60396 — 41— pt. 18 8 



NATIONAL DEFENSE MIGKATION 



TUESDAY, SEPTEMBER 23, 1941 

House of Representatives, 
Select Committee Investigating 

National Defense Migration, 

Washington, D. C. 

AFTERNOON SESSION 

The committee met at 2 o'clock p. m. 

The Chairman. The committee will please come to order. 

Mr. Stanchfield is our first witness. 

TESTIMONY OF PAUL L. STANCHFIELD, CHIEF OF RESEARCH, 
STATISTICS AND PIANNING SECTION, MICHIGAN UNEM- 
PLOYMENT COMPENSATION COMMISSION, DETROIT, MICH. 

The Chairman. Mr. Stanchfield, Congressman Curtis will interro- 
gate you. 

Mr. Curtis. Mr. Stanchfield, will you give your full name to the 
reporter, please? 

Mr. Stanchfield. Paul L. Stanchfield. 

Mr. Curtis. And your position? 

Mr. Stanchfield. Chief of Research, Statistics and Planning 
Section, Michigan Unemployment Compensation Commission. 

Mr. Curtis. You appeared before this committee once before, did 
you not? 

Mr. Stanchfield. Yes, sir; I saw you in Chicago.^ 

Mr. Curtis. Mr. Stanchfield, you have prepared a valuable and 
detailed statement. 

(The statement referred to above is as follows:) 

STATEMENT BY PAUL L. STANCHFIELD, CHIEF OF RESEARCH, 
STATISTICS AND PLANNING SECTION, MICHIGAN UNEMPLOY- 
MENT COMPENSATION COMMISSION 

Defense Migration in Michigan — Past Patterns of Migration and 
Future Problems Resulting from Production Quotas and Priorities 

This report presents selected data on the extent and character of migration 
which has already occurred in Michigan as a result of the defense program, and 
a discussion of future migration [)rob]ems which may result from dislocation of 
labor caused by autom.obile production quotas, material shoitages, or other 
factors related to the defense program. As background material, the report also 
discusses the normal migration pattern of Michigan industrial workers, and the 
character and location of Michigan's industries. 

The rapidly growing mass production industries of Detroit and other manu- 
facturing centers have in the past drawn a considerable part of their labor supply 

I Mr. Stanchfield testified on August 21, 1940. Sec Chicago hearings, pp. 1195-1215. 

7169 



7170 DETROIT HEARINGS 

from rural Michigan and from other States. Between 1920 and 1930, the popu- 
lation of four principal automoljile manufacturing counties increased by more 
than 400 percent. Most other industrial counties also grew rapidly. In the 
same period most of the counties in the cut-over area and the Upper Peninsula 
were losing population by migration. 

The expanding industrial centers also drew workers from other States and 
from foreign countries — so that in 1930 nearly a quarter of Michigan's residents 
were natives of other States, and nearly one-fifth were foreign born. Prior to 
1910, most of the migration into Michigan was from the East, but since then the 
Southern States have been an important source of labor. 

In depression periods, the trend of migration is reversed, with industrial workers 
moving back to the rural areas of Michigan or to other States. This type of 
movement is reflected in unemployment compensation claims filed in other States 
against the Michigan fund by former Michigan workers. In 1939, about 20,000 
individuals filed such claims — and only about 20 percent of these involved move- 
ment to adjacent States, while 80 percent were in nonadjacent States. A rela- 
tively large part of the interstate claimants moved from Michigan to States in 
the Appalachian area (Kentucky, Tennessee, Pennsylvania, and West Virginia). 
New York, California, and Missouri also were important. 

IMPACT OF AUTOMOBILE PRODUCTION QUOTAS 

The impact of passenger car production quotas will be felt severely in Michigan 
because of the predominance of the automobile industry in the State's economic 
structure. Nearly two-thirds of the 1,250,000 workers covered by the Michigan 
Unemployment Compensation Act are employed in manufacturing. The auto- 
mobile industry, together with steel, machinery manufacturing, and other in- 
dustries related to automobile production, employ more than three-quarters of 
all manufacturing wage-earners in Michigan, and almost half the total number 
covered by unemployment compensation. 

The predominance of the motor industry is even greater in Detroit and other 
important cities. Nearly four-fifths of Wayne County's industrial workers are 
engaged in production of automobiles, bodies, and parts, or in closely related 
industries. The motor industry furnishes nearly all of the factory jobs in Flint 
and Pontiac, and well over half the manufacturing employment in Lansing and 
Saginaw. 

Outside these five cities, the direct impact of automobile quotas will be less 
severe, but serious dislocation of labor may result from interruptions of civilian 
production which may be caused by material and equipment shortages in such 
cities as Grand Rapids, Kalamazoo, Battle Creek, and Jackson. 

Some of the State's smaller cities, dependent in some cases on a single non- 
defense industry, may experience serious crises as civilian production is curtailed. 

With primary defense contracts amounting to more than 1}>4 billion dollars, and 
subcontracts and indirect defense work bringing the total close to $4,000,000,000, 
Michigan's industrial centers will play a major role in defense production. New 
job opportunities in defense industries, and boom-time production in consumers 
goods industries, have led to considerable migration of workers to Detroit and 
other industrial centers in the past year. Over 26,000 of the 108,000 workers who 
filed new applications for work at Detroit employment offices in the 13 months 
ending August 1941 were last employed outside the Detroit area. The number of 
migrant applicants has increased steadily during the 13-month period. The total 
of 26,300 includes about 7,100 workers from other parts of Michigan, 5,800 from 
the Great Lakes area, 5,100 from the South, 4,100 from eastern States, 3,700 from 
States west of the Mississippi, and about 600 from foreign countries, including 
Canada. 

COMPENSATION CLAIMS AS EVIDENCE OF MIGRATION 

Less than 18 percent of the migrant applicants were skilled workers, while 
about half of them had occupational backgrounds which appear unsuitable for 
defense employment — ^including unskilled, service, clerical, saleg, and agricultural 
occupations. 

Other evidences of migration are found in initial claims for unemployment 
compensation filed by workers previously employed in other States, which in- 
creased by 21 percent from 1940 to 1941, while intrastate claims were declining 
sharply. Almost all of the increase in interstate claims was in industrial centers 
in the southeastern section of the State. 

Wage records of the Unemployment Compensation Commission show that a 
total of 66,000 workers who first obtained their social security numbers in other 



NATIONAL DEFENSE MIGRATION 7171 

States, but were not employed in Michigan in the first quarter of 1940, earned 
wages in covered employment in Michigan later in 1940 or in the first quarter of 
1941. Of these, 45 percent came from Great Lakes States, 18 percent from the 
Middle Atlantic States, 9 percent from the Soulh Central States, 7 percent from 
the South Atlantic States, and 13 percent from the Plains States. Other areas — 
the Pacific Coast, Mountain, and New England States — were of relatively minor 
importance. In addition to the Detroit area, employment offices in Flint, 
Saginaw, Pontiac, and other centers in southeastern Michigan have reported a 
more or less continuous influx of miairants from other States or from other parts of 
Michigan. Muskegon, with a high volume of defense work, has drawn workers 
from Grand Rapids and northern Michigan. 

Areas in Michigan from which workers have migrated include the Upper 
Peninsula and the cut-over area. While most of the migrants have sought work 
in southern Michigan industrial areas, some miners from the Upper Peninsula 
have gone to other States. Some of the less active industrial centers, such as 
Kalamazoo and Grand Rapids, have lost workers to Detroit and other centers of 
expanding employment. 

Production quotas and material shortages will cause a considerable amount 
of unemployment in Michigan in the next several months unless it is possible to 
accelerate defense production. A 50 percent curtailment would eliminate about 
175,000 nondefense jobs in the automobile industry by January 1942 — and in 
spite of off-setting increases in defense work, net unemployment in January will 
affect at least 54,000 workers in the Detroit area, 17,000 in Flint, and from 4.000 to 
6,000 in Pontiac, Lansing, and Saginaw. Adoption of a 32-hour week would reduce 
but not eliminate this unemployment. A more detailed discussion of the dis- 
location of labor expected in important cities, and the limitations of the data on 
which the estimates are based, is presented in section IV of this report. 

CURTAILMENT IN OTHER INDUSTRIES 

Outside the automobile centers, considerable unemployment may result from 
curtailed production (caused by material shortages if not by quotas) in many 
other industries using materials essential to defense. In Grand Rapids and 
Muskegon, for example, unemployment from this source may be severe. 

Since this dislocation of labor, in the absence of counter measures, may stimu- 
late migration away from Michigan's industrial centers, there is a real danger 
that essential workers will be unavailable when defense production reaches its 
peak in 1942. In order to meet this problem, it is essential for the State and 
Federal Governments — in cooperation with industry and labor — to take every 
possible step to protect the economic security of displaced workers, to speed up 
the expansion of defense jobs, and at the same time to prevent further migration 
to Michigan industrial centers, which might only multiply existing problems. 

Such possibilities as the liberalization of unemployment compensation, the 
development of training programs which furnish at least a subsistence income, 
and the assignment of defense contracts to concerns and areas most severely 
affected by quotas and priorities, must be energetically explored. 

Section I. Normal Migration Pattern of Michigan Industrial 

Workers 

Prior to the defense program the migration of workers to industrial centers has 
played a vital part in the growth of Michigan industry. Since the turn of the 
century, rapidly growing industries such as automobile manufacturing and the 
manufacture of refrigerators, heating equipment, and household appliances have 
required continually more manpower than has been available in the various man- 
ufacturing centers cf the State. High wages and high living standards in in- 
dustrial centers such as Detroit, Flint, Lansing, and Saginaw have attracted 
workers not only from rural parts of the State but from other States and other 
lands. Thus, a large part of the population of Michigan industrial centers con- 
sists of workers who formerly lived in other areas and their families. The rapid 
growth of Michigan industry would have been impossible without these shifts in 
population. 

The movement into industrial centers which marks periods of rising industrial 
activity is reversed in periods of depression such as the early 1930's. During 
such periods unemployed industrial workers who have migrated from communi- 
ties in rural Michigan and other States tend to return to their home communities 
and lower living costs. Rising business activity, however, finds many of these 
workers or their friends and neighbors returning to the industrial centcs of 
the State for employment in mass production industries at high wages. 



7172 DETROIT HEARINGS 

A. THE RISE OF MICHIGAN'S INDUSTRIAL POPULATION 

In the late 1800's Michigan's working population was predominantly engaged 
in agriculture, forestry, fishing, and mining, which accounted for 45 percent of 
all gainful workers in the State in 1880. In 1900 these three basic industries 
accounted for 37 percent of all Michigan gainful workers but by 1930 they ac- 
counted for less than 15 percent. During this period there was a marked increase 
not only in the proportion of workers engaged in manufacturing and mechanical 
industries but also in related pursuits such as transportation, communication, 
trade, and professional and clerical services. 

More striking than the change in the distribution of gainful workers was the 
actual increase in numbers from 569,000 in 1880 to 906,000 in 1900 and to 
1,927,000 in 1930. From 1900 to 1930 the number of workers engaged in manu- 
facturing and mechanical industries increased by 161 percent. 

B. SHIFTS IN POPULATION WITHIN THE STATE 

In the three decades from 1900 to 1930, the rise of large scale industry and the 
decline of agriculture, lumbering, and mining brought about rapid and sig- 
nificant changes in the distribution of population within the State. Although 
the State's population increased by 1,154,000 between 1920 and 1930, nearly all 
of the increase was concentrated in 26 counties, while 13 counties remained 
nearly unchanged, and 46 counties experienced population losses. In 4 principal 
automobile manufacturiiig counties, population increased from about 455,000 in 
1900 to nearly two and a half million in 1930 — an increase of more than 400 per- 
cent. Ten other important industrial counties also grew rapidly, with an aver- 
age increase of 73 percent. During the same period, there were only minor in- 
creases in the agricultural counties of the southern part of the Lower Peninsula 
and the Upper Peninsula, and an average decrease of 13 percent in the cut-over 
area comprising the northern half of the Lower Peninsula. 

In each decade, an increasing percentage of the State's workers have been 
massed in the industrial counties. The four maior automobile counties contained 
less than one-fifth of the total population in 1900 but more than half of the total 
population in 1930. 

While population in the industrial counties was increasing between 1920 and 
1930, the cut-over area and the Upper Peninsula were losing population by migra- 
tion to other areas. By use of data on births ai^d deaths in each county, it is 
possible to determine what the population would have been at the end of the 
decade with no migration to other areas. On the basis of these dala all but one of 
the counties in the cut-over area and all but three in the Upper Peninsula lost 
population by migration in the decade between 1920 and 1930. While the move- 
ment from farm to city was sharolv reversed during the depression, the expansion 
of industrial employment since 1935 has again created movement of workers from 
rural to urban areas. 

C. MIGRATION FROM OTHER STATES 

Migration of workers from rural sections of Michigan has been only one source 
of the population growth of the large automobile manufacturing centers. Accord- 
ing to the 1930 census, onlv 58 percent of the 4,842,000 persons in Michigan were 
residents of the State, while 23.5 percent (nearly 1,137,000) were natives of other 
States, and 17.6 percent (about 853,000) were toreign-born. The principal sources 
of migration from other States, in order of rank, were Ohio, Illinois, Indiana, 
Pennsylvania, New York, Wisconsin, Kentucky, and Tennessee. Sixteen percent 
of the population of Michigan in 1930 consisted of natives of these eight States. 

Prior to 1910 most of the migration into Michigan was from eastern States, 
particularly New York. Since 1910, southern States, particularly Kentucky, 
Tennessee, and West Virginia have accounted for a large portion of the migration 
into Michigan industrial centers. 

Michigan has long been a favorite center of settlement for the foreign-born. 
Only four States (New York, Pennsylvania, California, and Massachusetts) had 
more foreign-born residents than Michigan in 1930 and only seven States had a 
higher ratio of foreign-born. 

D. THE CHANGING DIRECTION OF MIGRATION IN DEPRESSION 

With the highest wage rates in the world for unskilled and semiskilled labor, 
and a relatively high standard of living, Detroit and the other automobile centers 
have been a magnet for migratory workers during periods of industrial expansion. 



NATIONAL DEFENSE EMIGRATION 7173 

The trend was to some extent reversed during the depression years of 1930 to 
1935, with thousands of workers and their families moving back to other parts 
of Michigan or their former homes in other States as unemployment became wide- 
spread in the manufacturing cities. The shift from the t;ities to rural areas and 
to other States was reflected in school census figures and in the special Micliigan 
Census of Population and Unemployment taken in 1935. The population of most 
industrial centers shoAved a decli'^e during this period while rural agricultural 
areas and cut-over areas of the State showed marked increases. 

With the growth of rational recovery, from 1935 to 1937, the tide of movement 
again turned toward the cities and former automobile workers (or their relatives 
and friends) again moved into such cities as Detroit and Flint in the search for 
jobs and high wages. While the volume of migration to Detroit in recent years 
has probably been less than it was in the 1930's, it was substantial even before 
the defense program created a new stimulus. 

E. OUT-MIGRATION OP THE UNEMPLOYED 

Two groups of migrants should probably be distinguished. Some of them — 
probably the majority — found permanent jobs in the industrial centers, made their 
homes there, and became part of the community. Others — especially those who 
were unmarried, or who did not bring their families with them — worked in the 
manufacturing centers only when jobs were available, and then returned to their 
former homes in rural Michigan or in other States during the off season. 

This latter type of movement is reflected to some extent in unemployment 
compensation claims filed aocainst the Michigan fund, in other States, by workers 
who formerly worked in Michiean. In 1939, about 20,000 individuals "filed such 
claims — and in the 2 years ending June 1940, it is estimated that at least 30,000 
different workers filed claims in other States against the Michigan Unemployment 
Compensation Fund. 

Less than 20 percent of these interstate claims came from States adjacent to 
Michigan, while 80 percent were from nonadjacent States — with a relatively large 
part of the total from Kentucky, Tennessee, Pennsjivania, and West Virginia. 
Other important States to whicli migration occurred were New York, California, 
and Missouri. 

Many of the interstate claimants had insufficient earnings in Michigan to qualify 
for benefits, but those who did qualify were primarily manufacturing workers 
(70 percent) and about 43 percent came from the automobile industry. The 
percentage of women among interstate claimants was considerably lower than 
among claimants who filed their claims within the State. 

Since 1939, as employment has expanded in the automobile centers, there has 
been less migration away from Michigan and more migration into the State. 
The out-movement which occurred during the 1938 depression, however, can be 
expected to recur in rather similar form if production quotas and priorities create 
a mass unemployment problem in Michigan. 

A supplementary statement on the extent and character of outward migration, 
as indicated by unemployment compensation records, will be submitted separately. 

F. MIGRATION OF NONMANUFACTURING WORKERS 

The number of nonmanufacturing workers cannot be ignored in the review of 
Michigan migration. The fruit and vegetable industrj^, the beet-sugar industry, 
the resort industry, and the logging industry depend to a considerable extent upon 
migratory seasonal workers who return to their home communities in the off- 
seasons. 

The fruit and vegetable industry has been dependent to a large extent upon city 
families with children who move from locality to locality with the crops. During 
the past decade the beet-sugar industry has been largely dependent upon Mexican 
labor from the Southwest for its field work. The resort industry is staffed largely 
by residents of resort communities, but is also dependent upon students who turn 
to the resort industry for summer employment and upon migratory resort workers 
who systematically work in northern resorts during the summer and southern 
resorts during the winter months. The logging industry is manned to a consider- 
able extent by single unattached men who are not permanent residents of the 
communities in which they work. 

Section II. Character and Location of Michigan's Industries 

The curtailment of passenger-car production will be felt more severely in 
Michigan than_in any other State, because of the predominance of this single 



7174 DETROIT HEARINGS 

industry in Michigan's economic structure.- The development of mass production 
has brought with it a rapid expansion of factory employment in this State. Some 
indication of the importance of manufacturing is furnished by the fact that 
more than 810,000 of the l,2.o0,000 workers covered by the Michigan Unemploy- 
ment Compensation Act in December 1940 were employed in manufacturing — 
approximately two-thirds of the total. 

Employment in the manufacture of automobiles, bodies, and parts accounts for 
nearly half of all factory employment — with a total of 394,000 covered workers 
in December. The steel industry, which in Michigan is largely dependent on 
automobile production, employed 95,000 workers at the end of 1940. Other 
important manufacturing industries, which to a, greater or less extent are affiliated 
with the automobile industry, include nonelectrical machinery manufacturing 
(73,000 employees), rubber products (11,000), nonferrous metals (22,000), elec- 
trical machinery (9,000) , and other transportation equipment (5,000) . Altogether 
these selected manufacturing groups employed almost 620,000 covered workers 
in December — almost half of the total number covered by the Unemployment 
Compensation Act, and well over three-fourths of the total for all manufacturing 
industries. 

Measured in terms of pay rolls, the predominance of the automobile industry is 
even greater than it is in terms of employment. In 1940, the wages and salaries 
of workers employed in the manufacture of automobiles, bodies, and parts (31 
percent of covered workers) amounted to $688,000,000 in Michigan — more than 
36 percent of the State's total covered pay rolls of .$1,908,000,000. Iron and steel, 
with aggregate pay rolls of $142,000,000, and nonelectrical machinery manufac- 
turing, with $136,000,000, bring the total wages and salaries of workers in tlie auto- 
mobile industry and the two most closely allied groups to almost $1,000,000,000 in 
1940 — and at the end of 1940, when employment on 1941 models was at a peak, 
wage and salary payments for these industries were proceeding at a rate equal to 
close to $1,200,000,000 per year. In this quarter, these industries accounted for 
45 percent of the State's covered employment, and 51 percent of all covered 
pay rolls. 

The manufacture of durable consumers' goods other than automobiles accounts 
for a large part of the State's indvistrial activity. Although these industries have 
not been affected so far by production quotas, they will be affected in many 
instances by material shortages under the priorities system. This is particularly 
true of manufacturers of refrigerators"; washing machines a,nd household appli- 
ances; furnaces, stoves, and heating equipment; hardware; and metal furniture 
and utensils. 

Any decline in factory employment, resulting from production quotas and 
material shortages, is certain to have repercussions on other industries, such as 
trade and service, which exist primarily to serve the wage earners employed in 
industry. Obviously, a curtailment in automobile production will restrict the 
employment opportunities of the 38,000 wage earners employed in retail automo- 
tive establishments, automobile service stations, garages, automotive finance 
companies, and other businesses dependent on sales of automobiles. In addition, 
some 16,000 proprietors are dependent on businesses in this field. Even if the 
loss of employment in this "satellite industry" is not in full proportion to the 
curtailment of production, substantial unemployment or reduction of income is 
bound to occur. Workers in durable consumer goods outlets will be affected in 
the same way. 

The impact of declining factory employment on retail and wholesale trade, 
service industries, and transportation presents an even greater problem. In 
Detroit, for example, there are 70 workers engaged in service and trade for every 
hundred engaged in primary production. Unless the unemployment of auto- 
mobile workers is minimized or kept to a short duration, it is conservative to 
estimate that at least 30 or 40 nonmanufacturing jobs will be eliminated for 
every hundred factory jobs which cease to exist. 

A. INDIVIDUAL AUTOMOTIVE CENTERS 

In Detroit and other important Michigan cities, the predominance of the auto- 
mobile industry as a source of manufacturing employment is even greater than 
would be suggested by the State-wide figures already presented. Wayne County, 
the automobile manufacturing center of the world, ranks second only to Cook 
County (Chicago) in the nimiber of manufacturing wage earners emploved in 
1937. In March of this year, about 499,000 of the 725,000 Wayne County 
workers covered by the Michigan Unemployment Compensation Act were em- 
ployed in manufacturing— and nearly 60 percent of Wayne County's factory 



NATIONAL DEFENSE MIGRATION 7175 

worker? (292,000) were engaged in production of automobiles, bodies, and parts. 
Other closely related manufacturing industries, likely to be affected indirectly by 
automobile curtailment are iron and steel manufacturing (with 51,000 covered 
employees in March), nonelectrical machinery (46,000) and nonferrous metal 
manufacturing (21,000). 

Manufacturing emiDloyment in Flint, Michigan's third city, is dominated over- 
whelmingly by the motor industry — perhaps to a greater extent that in any other 
city in the United States. Of the 64,000 workers covered by unemployment coin- 
pensation in March, nearly 50,000 were engaged in manufacturing and about 
47,000 of these were in the automobile industry, nearly all of them in General 
Motors plants. 

Pontiac, like Flint, is practically a one-industry city. Of the 45,000 Pontiac 
workers covered by unemployment compensation in March, 33,000 were engaged 
in manufacturing activities, and more than 85 i^ercent of these (27,000) were 
employed by automobile companies. 

In Lansing, despite a somewhat larger proportion of employment in trade, serv- 
ice, and Government work, manufacturing is the predominant industry — and 
nearly 17,000 of the 23,000 manufacturing workers covered by unemployment 
compensation in March were in the automobile industry. 

Saginaw County, with 20,000 manufacturing employees in March, had about 
12,000 in automobile parts factories, and more than 5,000 engaged in producing 
nonelectrical machinerj', much of which is used by the motor industry. 

B. AREAS DOMINATED BY NONAUTOMOTIVE MANUFACTURING 

Automobile factory emploj'inent is concentrated primarily in five cities of the 
southeastern section of the State — and in these cities any reduction of automobile 
production will have an immediate impact not only on the jobs of factory workers 
but also of men and women engaged in wholesale and retail trade and the various 
service industries which exist primarily to serve the factory population. In other 
sections of the State, production quotas will have a less direct effect, although 
there are significant numbers of automobile workers in such cities as Bay City 
and Grand Rapids. However, the principal unemployment problem which exists 
in such cities as Grand Rapids, Muskegon, and Kalamazoo will result from 
possible interruptions of civilian production which are caused by material and 
equipment shortages rather than by the automobile quotas themselves. 

Although Battle Creek is predominated by the processed cereal industry, it also 
has a number of durable goods manufacturing industries, such as printing presses, 
auto parts, stoves, steel and wire, and cooking utensils, which may be affected 
by materials shortages. Its most important national-defense industry is Fort 
Custer, which initiated a huge expansion program at the beginning of the defense 
emergency. This building program drew thousands of workers into the Battle 
Creek area. 

The Grand Rapids and Holland area has been engaged to some extent in the 
manufacture of automobile parts and equipment. The manufacture of furniture, 
electrical household equipment, stoves, and furnaces accounts for, by far the 
greatest proportion of its manufacturing. Industry is much more diversified in 
this area than in the automobile centers. It has a large proportion of small 
establishments, manj' of which are in various types of metal processing which 
may be affected by material priorities. So far, this area has received a very small 
number of national-defense contracts. 

Jackson manufacturing has been devoted to automobile parts and equipment, 
to electrical automotive parts and household appliances, and radios, and the pro- 
duction of industrial grinding wheels, drills, and tools. Since the beginning of 
the national-defense program, new firms have established plants in Jackson for 
defense production which may offset unemployment resulting from materials 
shortages and automobile quotas. 

Although Kalamazoo is noted as a paper manufacturing center, it is also an 
important stove and furnace manufacturing center, and produces considerable 
industrial machinery, tools, dies, and machine-shop products. 

Large national-defense contracts have resulted in considerable industrial 
expansion in Muskegon, since the beginning of the national-defense program, 
niaking this city an important center for the migration of industrial workers. 
Since it is a large producer of refrigerators, metal furniture, and various metal 
products, it may be affected greatly by material shortages under the priorities 
program. 



7176 DETROIT HEARINGS 

C. NONINDUSTRIAL AREAS AND ONE-INDUSTRY TOWNS 

The Upper Peninsula of the State, which has been noted for its mining and 
lumbering industries, will probably experience increased activity under the na- 
tional-defense program. Some mijies, which were inoperative for years, are now 
being worked to provide defense materials, while the demand for domestic wood 
pulp for the paper industry has been rising due to the fact that the European pulp 
supply has been cut off by the war. The northern part of the Lower Peninsula, 
which is predominantly cut-over and reforested land, has been little afifected by 
the national-defense program. 

Many of the small cities of the State which have single industries may be seri- 
ously affected by material shortages and production quotas. While manufac- 
turing in such cities accounts for only a small i^ortion of the industrial production 
of the State, the closing of a single plant may create serious crises in individual 
communities concerned. Lack of materials for stove production, as an example, 
would deprive Dowagiac of its most important source of employment. 

Industries such as the beet-sugar industry in the Saginaw Valley and Thumb 
area, and the fruit industry of the Lake Michigan area have been little affected 
by production quotas and priorities, but maj' be sorch' affected by tightening 
labor-market conditions which are diverting migratory part-time workers who 
have been traditionally emploj^-cd by these industries into defense cmploj^ment 
and into the military forces. While agriculture and industries dependent on 
agriculture have not been seriously affected during the 1941 season, more serious 
labor shortages may be expected in 1942 or after. 

D. DEFENSE POTENTIALITIES OF MICHIGAN INDUSTRY 

As the traditional centers of mass production industry in the United States, 
Detroit and the other automobile cities will play a major role in defense produc- 
tion. Primary defense contracts for more than one and a half billion dollars have 
been awarded to Michigan industry to date, p.nd additional subcontracts and in- 
direct defense work amoimt to over $2,000,000,000. Ph'entually, when the transi- 
tion from civilian to defense work has been completed, Michigan's factories will 
have need for all their present workers, and perhaps for even more. Mr.ch of the 
unemployment which may occur in the next few months represents only a tem- 
porary problem, and a period during which we must make efforts to keep our 
working force intact in prepa,ra,tion for the time when planes and other arma- 
ments are rolling out of Michigan factories in overwhelming amoinits. Some 
automobile workers, however, may not be able to find employment in defense 
industries because of the special skills required. In addition, there is likely to be 
continuing dislocation in nondefense employment throughout the defense period 
due to changing and increasing demands for materials for defense. 

By their very nature, Michigan's industries are potentially convertible to de- 
fense production. In July a survey by the State employment service showed 
that the automobile industry and other metal fabricating industries which might 
be adapted for defense j^roduction emplo.yed more than 682,000 workers. Of this 
total, more than 196,000, or 29 percent, were already engaged on defense work. 
About two-thirds of these (123,000) v.'ere in the Detroit area, while there were 
alreadv about 9,000 defense jobs in Muskegon, 9,000 in Pontiac, 7,300 in Bav 
City, 6,400 in Saginaw, 5,600 in Jackson, and 5,200 in Battle Creek. To date, 
the conversion to defense production has proceeded more ra.pidly in nonautomo- 
tive industries than in the automobile plants. The next phase of the defense 
expansion involves accelerated conversion of the automobile plants, with some 
temporary dislocation of labor, and the prospect of an eventual peak of employ- 
ment as high as or higher than anything in the past. 

Section III. Pattern of Migration During the Past Year 

The rapid expansion of both defense and nondefense employment in Michigan's 
industrial centers during the past year has brought with it a considerable migration 
of workers. In general, this has been a movement toward the principal industrial 
centers especially those in which there were important defense contracts, or in 
which there was a boom in production of civilian commodities. 



NATIONAL DEFENSE MIGRATION 7177 

Because increasing employment during the past year has been due partly to 
rises in automotive production and partly to defense expansion concentrated in 
automotive, centers, the general pattern of in-migration has been quite similar to 
the movement which has previously occurred vvhen auton.obile production has 
reached high levels. Many of the in-migrants are undoubtedly workers who 
have previously been employed in Michigan's industrial centers, especially in 
1929 and 1937. The prospect of thousands of new factory jobs has encouraged 
workers to move to such cities as Detroit, Flint, Pontiac, and Muskegon, both 
from rural Michigan and from other States. 

The Federal and State Governments, through the public employment service 
sj-stem and the Office of Production Managem,ent, have attempted to prevent 
unnecessary migration. The clearance system of the public employment offices 
is designed specifically to encourage m.igration only when a shortage of workers 
actually exists in a community. Local labor market information is used in an 
effort to keep workers from leaving areas in which job opportunities will soon be 
available. Because of the Nation-wide coverage of the clearance system, the 
Office of Production Managem.ent has urged euiployers to use the employment 
service whenever it appears necessary to recruit nonlocal workers. 

In spite of efforts to restrict n.igration, however, there is a good deal of evidence 
that many thousand workers have com.e to Michigan from other areas without 
any definite jot)s offered to them, in advance. 

Although a large proportion of the m.igrants have nevertheless found jobs, much 
of the movem.ent has been undesirable and unjustified, since local workers have 
been available and have been given preference for m.ost of the new jobs which 
have developed. As a general rule, Michigan employers have preferred to hire 
local residents, and have discouraged applications from the n.igrant group. Also, 
many of the migrants have lacked the occupational qualifications which are 
needed in defense jobs or in other expanding types of work. As a consequence, 
there is some evidence that many of the niigrants have not stayed in Michigan, but 
have continued to travel in search of work. In this section of the report, the 
following types of data on recent migration will be considered: 

(a) Analysis of "new applications for work" filed in Detroit offices of the em- 
ployment service during the past year by workers who had never previously 
registered in that area. 

(b) Claims for unemploj'm.ent com.pensation benefits filed in Michigan by 
workers previously employed in some other State. 

(c) Studies of the wage records of the Michigan Unem.ployment Com.pensation 
Com.mission to determine how n any workers with Social Security nunxbers origi- 
nally assigned in some other State were working in Michigan in 1941, although 
they had not been employed in this State at the beginning of 1940. 

(d) Comm.ents on migration into or out of the labor n^arket areas served by 
individual offices of the Michiran State Employment Service, based on narrative 
labor market reports submitted monthh' by the local offices. 

Later sections of the report will deal with future migration which may result 
from curtailment of nondefense automobile production or from unemployment 
caused be material and equipment shortages resulting from the defense program. 

A. NEW APPLICATIONS FILED BY MIGRANT WORKERS IN DETROIT EMPLOYMENT 
OFFICES, AUGUST 1940 TO AUGUST 1941 

Because of the concentration of heavy industry in the Detroit area, a con- 
siderable part of the defense migration during the past year has involved a move- 
ment from other areas to Detroit or its satellite communities. Since August 
1940, a sample of new applications filed in offices served by the Detroit Central 
Placement Office has been analyzed to determine how many registrants were last 
employed in some other area. 

Figures based on this analysis are summarized in tables I and 2. The first of 
these tables presents figures for each month in the period, surveyed while the 
second analyzes the data in terms of occupation. (In the tables, the data from 
the sample are expanded to estimated totals based on the total number of new 
applications in each month. A new application is an application for work re- 
. ceived from an individual for whom the local office has no record of a previous 
registration.) 



7178 



DETROIT HEARINGS 



Table 1. — Analysis of new applications ' accepted by Detroit area offices, by loca- 
tion of last employment prior to registration ^ August 1940 to August 1941 



Month 



Total 
all loca- 
tions 



Location of last employment prior to registration 



Detroit 



Applicants with last employment 
outside Detroit 



Total 



Michigan 



Great 
Lakes 
States 



All other 
locations 



Total, 13 months 

August 1940 

September 

October 

November 

December 

January 1941 

February 

March 

April 

May 

June 

July 

August 



81, 720 



26, 318 



7,132 



692 
899 
1,268 
1,148 
1.332 
1,876 
1,480 
2,240 
2,145 
2.664 
3, 432 
3,679 
3,463 



158 
250 
345 
311 
414 
497 
469 
592 
506 
617 
887 
911 
1,175 



5,775 



151 
177 
255 
252 
246 
425 
386 
481 
483 
638 
795 
755 
731 



383 

472 

668 

585 

672 

954 

625 

1,167 

1, 156 

1,409 

1, 750 

2,013 

1,557 



PERCENT DISTRIBUTION 



Total, 13 months 

August 1940 

September 

October 

November. 

December 

January 1941 

February 

March 

April 

May 

June 

July 

August 



100 



100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 
100 



75.6 



81.2 
77.7 
76.1 
74.5 
77.8 
76.6 
82.2 
82.9 
77.1 
75 3 
73 5 
69 
66.0 



24.4 



18.8 
22.3 
23.9 
25.5 
22.2 
23.4 
17.8 
17.1 
22.9 
24.7 
26 5 
31.0 
34.0 



4.3 
6.2 
6.5 



6.2 
5.6 
4.5 
5.4 
5.7 
6.9 
7.7 
11.5 



4.1 
4.4 
4.8 
5.6 
4.1 
5.3 
4.7 
3.7 
5.2 
5.9 
6.1 
6.3 
7.2 



12.4 



10.4 
11.7 
12.6 
13.0 
11.2 
11.9 
7.5 
8.9 
12.3 
13.1 
13.5 
17.0 
15.3 



1 Applications received from individuals never before registered in the ofBcc taking the applications. 

2 Figures obtained by expanding from a sample consisting of new applications received on 2 days of each 
week. 



NATIONAL DEFENSE MIGRATION 



7179 



Table 2.— Analysis of new applications ' received by Detroit area offices, by occupa- 
tional division and location of last employment prior to registration,^ August 1940 
to August 1941 





Total, all 
locations 


Location of last employment (or training) prior to registration in 
Detroit 


Occupations 


Applicants with last emlpoyment outside Detroit 




Detroit 


Total 


Michi- 
gan 


Great 

Lakes 


East 


South 


West 


For- 
eign 


Total, all applications- 


108, 038 


81, 720 


26, 318 


7,132 


5,775 


4,097 


5,121 


3,712 


481 


Total, by occupation 


98, 620 


74,411 


24,209 


6,527 


5, 483 


3,852 


4,734 


3.476 


137 


Professional and mana- 
gerial 

Clerical and sales 


5,633 
17, 036 
12, 915 

733 

16. 477 
31, 538 
14.288 


4,103 
13. 476 
10, 259 

305 
12. 160 
23. 378 
10. 730 


1, 530 
3,560 
2,656 

428 
4,317 
8,160 
3.558 


438 
834 
646 

164 
1,115 
2,407 

923 


376 
868 
530 

35 
1,091 

1,885 
698 


284 
674 
487 

15 

697 

1,188 

507 


174 
525 
615 

145 

780 

1,573 

922 


241 
624 
373 

69 

609 

1,058 

502 


17 
35 
5 


Agriculture, forestry, 

fishing 

Skilled 

Semiskilled... 


""25 
49 


Unskilled 


6 






Occupational class not avail- 


2.578 
6,840 


1,812 
5,497 


766 
1,343 


131 

474 


103 
189 


86 
159 


80 
307 


67 
169 


299 


No work history 


45 







PERCENTAGE DISTRIBUTION OF OCCUPATIONALLY CLASSIFIED APPLICATIONS 



Total, all applications. 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Percent 
100.0 


Per- 
cent 
100.0 


Professional and managerial. 
Clerical and sales 

Service... 

Agriculture, forestry, fishing. 
Skilled 


5.7 
17.3 
13.1 
.7 
16.1 
32.0 
14.5 


5.5 
18.1 
13.8 
.4 
16.4 
31.4 
14.4 


6.3 
14.7 
11.0 

1.8 
17.8 
33.7 
14.7 


6.7 
12.8 
9.9 
2.5 
17.1 
36.9 
14.1 


6.9 

15.8 
9.7 
.6 
19.9 
34,4 
12.7 


7.4 
17.5 
12.6 
.4 
18.1 
30.8 
13.2 


3.7 
11.1 
13.0 

3.1 
16.5 
33.2 
19.4 


6.9 
18.0 
10.7 

2.0 
17.5 
30.4 
14.5 


12.4 

25.6 

3.6 

18.2 


Semiskilled 

Unskilled 


35.8 
4.4 



• Applications received from individuals never before registered in the office taking the applications. 
' Figures obtained by expanding from a sample consisting of new applications received on 2 days of each 
week. 



7180 DETROIT HEARINGS 

About 26,300 of the 108,000 workers who filed "new applications" during the 13 
months ending August 31, 1941, were last employed outside the Detroit area. 
About 7,100 (G.6 percent) came to Detroit from some other part of Michigan, and 
about 19,200 (17.8 percent) were migrants from other States. More than two- 
thirds of the interstate migrants (about 13,400) had come from States not adjacent 
to Michigan, primarily from the South and the West. 

The number of new applicants whose last employment was outside Detroit has 
increased steadily during the 13-month period. In August and September 1940 
less than 900 "migrant applications" were filed per month, but the monthl}' num- 
ber rose to 1,332 in December, 2,240 in March and reached its peak with a total 
of between 3,400 and 3,700 per month in June, July, and August of this year. 

Part of the increase in migrant applications ma probably be explained by more 
general use of the employm.ent offices, since the total volume of new applications 
(including local workers) also increased during the same period. In March, the 
total volume of new applications was especially stimulated by a worker recruit- 
ment campaign designed to obtain full registration of the available labor supply. 

The proportion of new applications fled by workers last employed outside 
Detroit rose from 19 percent in August 1940 to 25.5 percent in November, but 
dropped as low as 17 or 18 percent in February and March. Since March 1941 
there has been a steady increase in the percentage of new applications filed by 
"migrants." Nonlocal workers represented 31 percent of all new applicants in 
July 1941 and 31 percent in August. 

Of all new applications from nonlocal workers, the number filed by workers from 
other areas in Michigan has increased most sharpl}', rising from less than 300 in 
August and September of 1940 to more than 900 in July and nearly 1,200 in August 
1941. 

New applications filed by workers from other Great Lakes States also underwent 
a marked increase,, advancing from about 200 per month in the latter part of 1940 
to a monthly total of between 700 and 800 in June, July, and August 1941. 

Migration from States not adjacent to Michigan has shown the smallest pro- 
portionate rise, but in each of the 13 months covered by table 1 the total number of 
applicants from such States has been greater than the number from either the 
Great Lakes States or from Michigan communities outside Detroit. 

The State of origin of interstate migrants is shown in slightly greater detail 
in table 2, which also classifies applicants from each area according to primary 
occupational classification. Of the 19,186 migrants from other States, about 5,100 
or 26.5 percent had been last employed in Southern States — representing a total 
nearly as great as the 5,775 migrants from the Great Lakes area. Applicants from 
Eastern States (including New England) accounted for a little more than one-fifth 
of the total interstate movement (4,100 or 21 percent). A slightly smaller number 
(3,712) had come from States west of the Mississippi and 481 of the migrant ap- 
plicants had last worked or received their education in foreign countries, including 
Canada. 

Only a small proportion of the migrants had experience in skilled occupations, 
the type for which there has been a .special demand in the defense program. Of 
the 26,300 last employed outside Detroit, only 4,300 (17.8 percent) were classified 
as skilled workers. The proportion of skilled applicants was fairly similar for 
all areas, with the highest percentage of skilled applicants coming from the Great 
Lakes States and the lowest percentage from the Southern States. 

Semiskilled workers were the most important group among the migrant appli- 
cants, comprising just over one-third of the total (8,160 or 33.7 percent). The 
semiskilled proportion was highest among migrants from other points in Michi- 
gan and lowest among migrants from the East and from the West. 

About half of the migrants had occupational backgrounds which appear to 
have no special suitability for employment in defense production. Of the total 
last employed outside Detroit, nearly 15 percent were unskilled workers, 11 per- 
cent were classified in service occupations, 15 percent in clerical and sales occupa- 
tions. About 6 percent were professional and managerial workers, and 2 percent 
were agricultural workers. 

Migrants from the South included a greater proportion of unskilled workers 
and service workers (19.4 and 13 percent, respectively) than any other section, 
while Eastern and Western States had a relatively high proportion of clerical and 
sales workers. 

The above figures on new applications represent an understatement of the actual 
number of migrant workers who have come to the Detroit area, since some mi- 



NATIONAL DEFENSE MIGRATION 



7181 



grants fail to register with the employment service, especially if they are easily 
able to obtain jobs without registering. However, the data shown' in tallies 1 
and 2 give some indication of the general volume of migration, and the distribu- 
tions of migrants by area and by occupational group are probably fairly repre- 
sentative of all migration to the area. 



B. INTERSTATE CLAIMS AS A MEASURE OF MIGRATION 

A second source of information on interstate movements of workers is the record 
of interstate unemployment compensation claims. The Michigan State Employ- 
ment Service offices act as agents for other States in accepting claims for benefits 
filed by workers previously employed outside of Michigan. Interstate claims 
furnish only an indirect measure of worker migration, since many migrants may 
be ineligible for benefits or may obtain jobs before filing claims in this State. 
Despite these and other limitations, data on interstate claims furnish a useful 
indication of the trend of migration, though not of the volume of movement (see 
tables 3a, 3b, and 4). 

Table 3 A. — Trend in total number of benefit claims filed with Michigan as liable 
and agent State, monthly State totals and indexes} January 1939 to August 1941 



Month 



1939 

Average- -- 

January 

February. _ 

March 

April 

May 

June 

July 

August 

September 

October 

November 

December 

1940 

Average- -- 

January 

February 

March 

April 

May 

June 

July 

August 

September 

October 

November 

December 

1941 

January 

February 

March 

April 

May 

June 

July 

August 



Total number of benefit claims 


Indexes ' of total number of claims 




filed 






filed 




Michigan liable 




Michigan liable 








Michigan 
agent 






Michigan 










agent 


Intrastate 


Interstate 




Intrastate 


Interstate 




318, 196 


12,980 
24, 369 


4, 250 


100.0 


100.0 


100. 


376, 021 


3.865 


118.2 


187.8 


90.9 


266, 694 


16, 171 


3,893 


83.8 


124.6 


91.6 


261, 320 


18, 024 


4,072 


82.1 


138.9 


95.8 


210, 048 


12, 024 


3,365 


66.0 


92.6 


79.2 


265, 988 


13, 319 


3,697 


83.6 


102.6 


87.0 


412, 549 


11,453 


3,557 


129.7 


88.2 


83.7 


480, 644 


12, 357 


4,486 


151.1 


95.2 


105.6 


653, 546 


16, 736 


5,157 


205. 3 


128.9 


121.3 


271, 657 


9,301 


4,541 


85.4 


71.7 


106.8 


238, 568 


7,038 


4,760 


75.0 


54.2 


112.0 


214. 749 


6,704 


4, 804 


67.5 


51.6 


113.0 


166, 563 


8,266 


4, 807 


52.3 


63.7 


113.1 


265, 696 


12, 414 


7,244 


83.5 


95.6 


170.4 


252, 505 


12, 729 


6,503 


79.4 


98.1 


153.0 


235, 498 


12, 752 


5,910 


74.0 


98.2 


139.1 


218, 408 


12, 344 


5, 865 


68.6 


95.1 


138. 


242, 468 


13, 808 


7,130 


76.2 


106.4 


167.8 


237, 697 


14, 273 


6,898 


74.7 


110.0 


162.3 


291, 837 


13, 799 


7,057 


91.7 


106.3 


166.0 


575, 675 


17, 717 


9,357 


180.9 


136.5 


220.2 


541, 545 


18, 334 


8,477 


170.2 


141.2 


199. 5 


225, 450 


10, 387 


7,611 


70.9 


80.2 


179. 1 


143, 326 


8,495 


7,677 


45.0 


65.4 


180.6 


.100,374 


7,237 


6,845 


31.5 


55.8 


161.1 


123, 573 


7,092 


7,595 


38.8 


54.6 


178.7 


143, 003 


11, 259 


8, 563 


44.9 


86.7 


201.5 


131,202 


8,669 


7,166 


41.2 


66.8 


168.6 


120, 091 


8,689 


6,422 


37.7 


66.9 


151.1 


124,527 


8, 045 


6,766 


39.1 


62.0 


159.2 


96, 894 


6, 361 


6,028 


31.1 


49.0 


141.8 


80, 671 


5,376 


6, 520 


25.3 


41.4 


153.4 


252, 921 


7,311 


7,715 


79.5 


56.3 


181.5 


351,676 


9,649 


7,509 


110. 5 


74.3 


176 7 



> Base: 1939 monthly average= 100.0. 



7182 



DETROIT HEARINGS 



Table 3B. — Trend, in number of initial claims filed with Michigan as liable and 
agent State, monthly State totals and indexes,^ January 1939 to August 1941 





Number of initial claims 
filed 


Indexes ' of number of initial claims 
filed 


Month 


Michigan liable 


Michigan 
agent 


Michigan liable 


Michigan 




Intrastate 


Interstate 


Intrastate 


Interstate 


agent 


1939 


67, 978 


1,693 


544 


100.0 


100.0 


100.0 








39, 219 
38, 062 
40, 050 
39, 453 
73, 865 
173,411 
149, 259 
77, 101 
32, 219 
84, 380 
33, 293 
35, 423 

50, 509 


2,337 
1,603 

1,745 
1,505 
1,449 
1,622 
3,718 
1, 516 
1,016 
1,299 
1, .342 
1,169 

1,680 


410 
415 
393 
423 
383 
480 
738 
632 
593 
645 
602 
810 

978 


57.7 

56.0 

58.9 

58.0 

108.7 

255.1 

219.6 

113.4 

47.4 

124.1 

49.0 

52.1 

74.3 


138.0 
94.7 

103.1 
88.9 
85.5 
95.8 

219.5 
89.5 
60.0 
76.7 
79.3 
69.0 

99.2 


75.4 


February 


76.3 


March .- _ - 


72.3 




77.8 




70.4 




88.3 


July 


13.5. 7 




116.2 


September . -- 


109.1 


October .. -. 


118.7 




110.7 


December - - 


149.1 


1940 


179.8 








63, 620 
39,917 
29, 864 
44, 359 
42, 392 
79, 854 
159, 659 
53, 991 
24, 206 
22, 497 
18, 095 
27, 652 

31,754 
20, 423 
20, 879 
29, 780 
24,548 
21, 188 
123, 981 
54, 046 


2,116 
1,475 
1,499 
2.251 
1,670 
1,554 
3,929 
1,174 
1,004 
1,108 
1,019 
1,364 

1,788 

971 

1,057 

1,311 

692 

755 

1,722 

1,947 


9G0 

692 

723 

1,039 

868 

985 

1,355 

1,026 

1,025 

1,047 

1,027 

986 

1, 362 

949 

984 

1,346 

909 

1,026 

1,387 

1,267 


93.6 

58.7 
43.9 
65.3 
62.4 
117.5 
234.9 
79.4 
35.6 
33.1 
26.6 
40.7 

46.7 
.30.0 
30.7 
43.8 
36.1 
31.2 
182.4 
79.5 


125.0 

87.1 
88.5 

133.0 
98.6 
91.8 

232.1 
69.3 
59.3 
65.4 
60.2 
80.6 

105. 6 
57.4 
62.4 
77.4 
40.9 
44.6 
101.7 
115.0 


176.5 


February 


127.2 


March 


132.9 


April 


191.0 




159.6 




181.1 


July 


249.1 




188.6 




188.4 


October 


192.5 




188.8 




181.2 


1941 


250.4 




174.4 




180.9 


April - 


247.4 




167.1 




188.6 




255.0 


August - 


232.9 







1 Base: 1939 monthly average=100.0. 



NATIONAL DEFENSE MIGRATION 



7183 



Table 4.- — Comparison of interstate and intrastate claim volume, by office, first 8 

fnonths, 1940 and 1941 





First 8 months, 1941 


First 8 months, 1940 


Percent change first 8 
months, 1940 to 1941 


Area and office 


Total inter- 
state claims 


Initial inter- 
state claims 


Total inter- 
state claims 


Initial inter- 
state claims 


Total claims 


Initial claims 




Num- 
ber 


Per- 
cent 
of all 
claims 


Num- 
ber 


Per- 
cent 
of all 
initial 
claims 


Num- 
ber 


Per- 
cent 
of all 
claims 


Num- 
ber 


Per- 
cent 
of all 
initial 
claims 


Inter- 
state 


Intra- 
state 


Inter- 
state 


Intra- 
state 


State total 


56, 689 


4.0 


9,230 


2.7 


57, 197 


2.1 


7,648 


1.4 


-0.9 


-49.6 


+20.7 


+36.4 




3,446 


3.9 


447 


3.6 


3,960 


3.2 


523 


3.5 


-12.9 


-28.7 


-14.5 


-17.0 






Escanaba.-- 

Hancock 


256 
599 
678 
405 
755 

45 
272 
209 

63 
8 

40 
116 


4.3 
4.3 
6.1 

6.9 
4.2 
2.2 
2.1 
4.8 
1.4 
1.8 
1.7 
1.6 


39 
64 

87 
51 
107 

7 
44 
15 

5 


4.8 
4.0 
3.3 
9.2 
4.6 
1.7 
2.6 
2.2 
.8 


340 
586 
641 
511 
842 
72 
418- 
122 
144 


4.0 
2.1 
5.4 
6.7 
4.3 
2.6 
2.6 
1.4 
2.8 


45 
69 
90 
58 
115 
11 
60 
16 
14 


3.8 
2.6 
5.0 
8.4 
4.7 
2.4 
3.4 
1.2 
2.1 


-24.7 
+2.2 
+5.8 
-20.8 
-10.3 
-37.5 
-34.9 
+71.3 
-56.3 


-31.2 

-51.8 
-6.6 
-22.3 
-9.0 
-25.8 
-19.9 
-52.0 
-15.7 


-13.3 
-7.3 
-3.3 

-12.1 
-7.0 

-36.4 

-26.7 
-6.3 

-64.3 


-32.4 
-41.6 


Iron Mountain- - 

Iron River 

Ironwood 

Manistique 

Marquette 

Menominee 

Munising 

Ontonagon 

St. Ignace 

Sault Ste. Marie_ 


+50.0 
-20.1 

-4.0 
-10.3 

-4.0 
-48.4 

-8.1 


8 
20 


3.1 

2.4 


40 
244 


2.0 
2.0 


8 
37 


3.6 
2.1 



-52.5 


+21.1 
-40.8 



-46.0 


+17.7 
-53.4 


Area 2 - 


4,782 


3.8 


679 


2.8 


6,551 


2.5 


799 


1.6 


-27.0 


-52.4 


-15.0 


-51.9 






Cadillac 

Grand Rapids... 
Holland 


155 
1,505 
498 
266 
491 
1,193 
325 
349 


2.5 
2.8 
4.0 
2.9 
8.4 
6.5 
3.2 
4.1 


17 
251 
63 
38 
59 
191 
32 
28 


2.2 
2.1 
2.6 
2.0 
6.0 
4.9 
2.8 
2.3 


366 
2,236 
632 
234 
598 
1,432 
586 
467 


2.8 
2.2 
2.3 
1.5 
4.0 
2.6 
3.5 
2.9 


29 
279 
94 
38 
73 
209 
28 
49 


1.7 
1.3 
2.0 
1.2 
2.9 
1.6 
1.6 
3.0 


-57.7 
-32.7 
-21.2 
+13.7 
-17.9 
-16.7 
-44.5 
-25.3 


-52.8 
-46.0 
-56.3 
-42.3 
-62,8 
-67.5 
-39.8 
-47.5 


-41.4 
-10.0 
-33.0 



-19.2 

-8.6 

+14.3 

-42.9 


-55.0 
-45.2 
-49.2 




-40.8 


Manistee 

Muskegon 

Petoskey. 

Traverse City... 


-61.7 
-70.4 
-34.3 
-24.0 


Area 3 .-. 


4,426 


2.0 


634 


1.2 


4,738 


1.3 


575 


.7 


-6.6 


-42.5 


+10.3 


-34.7 






Alma 


230 
152 
667 
2,117 
332 
794 
134 


1.9 
1.0 
2.0 
2.0 
2.3 
2.7 
2.1 


29 
13 
85 

302 
45 

150 
10 


1.5 
.9 
1.4 
1.0 
1.6 
2.0 
1.0 


431 
223 
570 
1,890 
687 
660 
277 


2.1 
.8 
.9 
1.2 
1.8 
1.1 
2.9 


49 
21 
63 
279 
65 
84 
14 


1.7 
.7 
.6 
.7 

1.1 
.6 

1.0 


-46.6 
-31.8 
+17.0 
+12.0 
-51.7 
+20.3 
-51.6 


-39.5 
-43.0 
-50.6 
-31.0 
-63.6 
-51.6 
-30.3 


-40.8 
-38.1 
+34.9 
+8.2 
-30.8 
+78.6 
-28.6 


-34. 7 
-54.5 


Bay City 

Flint 


-45.2 
-24.0 


Port Huron 

Saginaw 

West Branch 


-54.3 
-44.8 
-29.9 


Area4..- 


8,777 


5.4 


1,324 


3.9 


10, 375 ■ 


3.4 


1,312 


2.3 


-15.4 


-48.4 


+.9 


-41.5 








402 

1,062 

1,122 

2,229 

731 

714 

1, 235 

784 

169 

329 


7.4 
6.7 
6.9 

17.3 
3.8 
4.3 
2.2 

16.8 
1.7 
8.5 


55 
223 
146 
271 
111 
111 
222 
105 
35 
45 


4.2 
5.4 
5.0 
13.2 
2.8 
3.1 
1.9 
9.2 
1.6 
7.3 


612 

776 

1,036 

3,094 

1,111 

1,194 

1,223 

799 

178 

352 


3.9 
2.8 
2.7 
10.1 
2.3 
4.4 
1.4 
9.9 
1.2 
4.0 


69 
145 
140 
324 
123 
163 
181 
101 
21 
45 


2.1 
2.9 
2.3 
7.7 
1.4 
3.9 
1.0 
5.6 
.7 
2.8 


-34.3 

+36.9 
+8.3 
-28.0 
-34.2 
-40.2 
+1.0 
-1.9 
-5.1 
-6.5 


-66.5 
-45.1 
-60.3 
-61.1 
-60.4 
-38.1 
-34.5 
-46.7 
-35.9 
-58.3 


-20.3 

+53.8 
+4.3 

-16.4 
-9.8 

-31.9 

+22.7 
+4.0 

+66.7 



-61.6 


Ann Arbor 

Battle Creek 

Benton Harbor. - 

Jackson 

Kalamazoo 

Lansing 

Niles 


-19.9 
-53.0 
-54.3 
-56.6 
-12.2 
-35.9 
-39.6 


Owosso - -- 


-33.2 


Sturgis 


-62.7 






Areas 


35, 258 


4.6 


6,146 


2.9 


31, 573 


2.0 


4,439 


1.4 


+11.7 


-53.2 


+38.5 


-34.5 






Detroit 


31,238 

393 

374 

2,011 

1,242 


4.6 
5.3 
3.0 
4.5 
5.1 


5,504 

63 

54 

333 

192 


2.9 
3.5 
1.6 
2.8 
2.3 


28,447 

603 

358 

1,188 

977 


2.0 
3.6 
1.5 
1.9 
1.9 


4,050 
54 
29 
180 
126 


1.4 
1.9 
.7 
1.1 
1.0 


+9.8 
-34.8 

+4.5 
+69.3 
+27.1 


-54.2 
-56.3 
-49.1 
-29.3 

-54.7 


+35.9 
+16.7 
+86.2 
+85.0 
+52.4 


-35.0 


Monroe 


-38.3 


Mount Clemens _ 
Pontiac 


-20.0 
-28.5 


Wyandotte 


-34.4 



60396--41--pt. 18- 



7184 DETROIT HEARINGS 

Tables 3A and 3B contain monthly figures on intrastate and interstate claims 
for unemployment compensation which have been received by the Michigan 
agenc3^ Interstate claims received as liable State represent claims filed in other 
States by workers who earned their benefit eligibility in Michigan. Agent State 
claims are those filed in Michigan local offices by workers whose covered employ- 
ment was in some other State. 

Variations in the trends for these various types of claims are clearly indicated 
by the indexes in tables 3 A and 3B. 

While the total number of intrastate claims remained well below the 1939 
average from September of last year through July 1941, the number of agent 
State claims was from 42 to 102 percent greater than the monthly average for 
1939 (table 3A). 

Interstate claims received as liable State have declined since last year, but the 
decrease for this type of claim has been considerably smaller than the drop for 
intrastate claims. 

Until the seasonal automotive lay-offs, the number of interstate claims taken 
in other States against the Michigan fund have been considerably less than the 
volume of claims taken in Michigan against other States, although the reverse 
was true during the depression period of 1938 and 1939. 

For initial claims, differences in the trends for intrastate and agent interstate 
claims have been even wider. 

During the first 8 months of 1941, 9,230 initial claims were filed in Michigan 
by workers previously employed in other States. Most of these claims represented 
different individuals, though a few workers may have filed more than one initial 
claim. The total represents an increase of 21 percent above the corresponding 
months of 1940, when only 7,648 initial interstate claims were filed in Michigan. 

While the percentage of increase is not striking, its importance as a measure of 
trend becomes greater when it is noted that the number of local initial claims, 
filed by workers still residing in this State, declined by 36 percent in the same 
period. The fact that claims takens as agent State have increased at the same 
time that claims against the Michigan fund were falling suggests a significant 
movement of workers from other States. 

The increase in initial interstate claims has been by no means evenly spread 
throughout the State. Almost all of the increase occurred in industrial centers, 
with the change from 1940 amounting to a gain of 36 percent in Detroit, 85 percent 
in Pontiac, 79 percent in Saginaw, and 35 percent in Bay City. There were 
significant increases in Flint and Lansing, and a few of the small cities, including 
Monroe, Wyandotte, Mount Clemens, and Ann Arbor, also had sharp gains in 
interstate claims. 

Since initial interstate claims generally represent the first appearance of a 
non-Michigan worker at a Michigan employment office, these increases indicate 
which sections of Michigan have had the greatest drawing power for migrant 
industrial workers. In other areas, the volume of interstate claims has declined, 
although in some cases the decline was less than for intrastate initial claims. None 
of the Upper Peninusla offices accepted more initial interstate claims in 1941 than 
in 1940, and in the northern and western sections of the Lower Peninsula declines 
were general. (The only exceptions are minor increases in Petoskey, Niles, and 
Battle Creek.) 

While the number of initial agent State claims has remained small in absolute 
volume, such claims were equal to 2.7 percent of the number of initial against the 
Michigan fund in 1941, compared with only 1.4 percent in the first 8 months of 
1940. In the Detroit area, the corresponding increase was from 1.4 to 2.9 per- 
cent. In each of the five administrative areas, and in nearly all of the individual 
offices, the ratio of initial interstate claims to initial intrastate claims was higher 
in 1941 than in the previous year. 

Although the total volume of interstate claims (including continued as well as 
initial claims) was almost unchanged from 1940 to 1941, such claims represent 
4 percent of the total number of claims taken in Michigan offices this year as 
compared to 2.1 percent last year. In Detroit, the increase was from 2 to 4.6 
percent. 

C. EVIDENCE OF MIGRATION FROM WAOE RECORDS OP THE UNEMPLOYMENT 
COMPENSATION COMMISSION 

Data on employment service applications and interstate claims, while valuable 
as industries of the trend of migration, fail to yjve the whole picture because they 
deal only with unemployed workers. Another approach is necessary in order to 
determine how many migrants have actually moved to Michigan and found jobs 



NATIONAL DEFENSE MIGRATION 7185 

here. Some of these are the same individuals who are reflected in interstate 
claims or new applications, but there are no doubt many other migrants who 
obtain work without registering at an employment office or filing an interstate 
claim. 

With this problem in mind, a special study of the wage records of the Unemploy- 
ment Compensation Commission has been made, based on a sample of individuals 
whose social -security numbers were originally assigned in some other State. The 
study covered the five calendar quarters from the beginning of 1940 through the 
first quarter of 1941. 

In general, it may be assumed that workers with out-of-State social security 
numbers who were not employed by subject establishments in Michigan in the 
first quarter of 1941 and earned wages in covered employment subsequently are 
for the most part migrants from other States. This assumption has certain obvi- 
ous limitations. Some workers falling in this class may have been employed pre- 
viously in Michigan, but may have been unemployed or engaged in noncovered 
employment in the first quarter of 1940. On the other hand, some workers may 
have moved in from other States and obtained jobs in Michigan in noncovered 
employment, and this group would not be identified in such a study. Also, some 
migrants who found work in covered employment may have obtained social 
security numbers in Michigan after they arrived here. Assuming that these 
various limitations tend to cancel out, the following summary is a fair indication 
of the extent to which migrants have found work in Michigan. 

The wage-record survey indicated that a total of 66,010 workers with out-of- 
State social-security numbers, not employed in Michigan in the first quarter of 
1940, earned wages in covered employment later in 1940 or in the first calendar 
quarter of 1941. Workers who obtained their social security numbers in the 
Great Lakes States made up nearly half of the total (29,680, or 45 percent). 
The State of Ohio contributed the largest number of migrants (19 percent, but 
nearly 13 percent were from Illinois, nearly 8 percent from Indiana, and 5.5 per 
cent "from Wisconsin. 

The area contributing the next largest group of migrants was the Middle At- 
lantic States, with over 12,000 workers, or 18 percent of the total. New York 
accounted for 9 percent, Pennsylvania 6.5 percent, and other Middle Atlantic 
States less than 3 percent. 

The Southern States, which furnished a rather large percentage of the unem- 
ployed applicants at Detroit employment offices, furnished a smaller proportion of 
the workers who actually found jobs in Michigan. Nine percent came from the 
South Central States, with about one-third of these from Tennessee and one- 
third from all other States in the area. About 7 percent of the total came from 
the South Atlantic States, with a little more than 2 percent from Florida, 2 per- 
cent from West Virginia, and the remainder scattered. 

The Plains States, with 8,700 employed migrants, furnished a surprisingly large 
proportion of the total. More than i3 percent of the employed migrants came 
from this group of States, with 4.4 percent from Missouri, 2.6 percent from Iowa, 
2 percent from Texas, and the remainder scattered. 

A little less than 5 percent of the employed migrants had first obtained their 
social-security numbers in Pacific Coast States, with nearly 4 percent from Cali- 
fornia. The Mountain States and New England States, each accounting for less 
than 2 percent of the total, furnished only a small fraction of the employed 
migrants. 

D. PRINCIPAL AREAS AFFECTED BY MIGRATION 

A considerable amount of information, not easily reduced to figures, is available 
on the general trend of migration in individual labor market areas throughout the 
State. On the basis of monthly reports submitted by local employment offices the 
following notes summarize the situation in selected communities to which there 
has been a substantial amount of migration, or from which significant numbers of 
workers have moved to other areas in search of jobs. 

Largely because of the impetus of defense orders, Muskegon industrial employ- 
ment is at an all-time high and workers have been entering the area from all of 
northern Michigan and from some more southern cities, including Grand Rapids. 

Both Flint and Saginaw offices of the State employment service have reported a 
large number of northern Michigan workers applying for work in the automobile 
factories, the latter office reporting over 100 migratory workers' applications during 



7186 DETROIT HEARINGS 

June. There are some indications that northern Michigan workers stop at these 
cities and, if worli is not immediately available, continue on south toward Pontiac 
and Detroit. 

Applications of nonlocal workers have maintained an unusually high level in 
Pontiac. In June the local employment service office reported that approximately 
60 percent of the 550 new registrations were received from nonlocal workers, while 
in July, the proportion increased to 65 percent. The Pontiac office reports that 
approximately 75 percent of the migrant workers desire factory employment, 
although a fairly large proportion are floating workers who do not wish steady 
employment. The emploj-ment manager of one large automotive establishment 
in Pontiac reported in June that nearly three-fourths of the workers applying at 
the plant were from other States. 

The Ann Arbor, Jackson, and Battle Creek offices of the State employment 
service have all reported a more or less continuous influx of workers from other 
States. During June, the Ann Arbor office received an average of 6 applica- 
tions a day from individuals with less than 30 days' residence in the count}^ while 
in Battle Creek, about 125 of the new registrants in June had been in the area for 
less than 6 months. During the same period, Jackson reported approximately 
5 registrations of nonlocal workers daily, approximately one-third of whom were 
from outside of Michigan. There are indications that when work is not immedi- 
ately available, the nonlocal applicants at these cities also move to the next center, 
finally converging upon Detroit. 

The leading Michigan source of migrant workers is undoubtedly the Upper 
Peninsula and the northern part of the Lower Peninsula, where industrial employ- 
ment opportunities are limited and defense employment has not been significant. 
Nearly all local offices of the employment service in these areas have reported an 
extensive departure of workers, chiefly for the southern Michigan industrial areas. 
In the Hancock area, however, a considerable number of miners have also left for 
copper producing areas in Arizona. The Hancock Employment Service office 
estimates that nearly 1,500 workers have left the area for work in other parts of the 
country. The office reported in July that few workers have returned with the 
general comment that "jobs are not as plentiful as one is lead to believe." 

Wisconsin industry has also attracted a significant number of workers from 
Michigan's Upper Peninsula, some on a seasonal basis only. 

In the Lower Peninsula, Manistee and West Branch have both reported large 
scale out-migration in the direction of Detroit and the other Michigan industrial 
areas. In Manistee, even employed workers are leaving, attracted by the higher 
wage scales in other parts of the Lower Peninsula. 

Although Grand Rapids is an important Michigan industrial center, it has 
experienced a net loss of workers to Muskegon and the automobile manufacturing 
cities of the eastern part of the State. Partly because of the nature of Grand 
Rapids industry, relatively few defense orders have been awarded there and indus- 
trial employment has not kept pace with that in the automobile centers and 
Muskegon. 

In southern Michigan, the Niles-Sturgis area has suffered a net loss of workers, 
some to Detroit but mostly to the cities of northern Indiana such as Elkhart and 
South Bend where defense employment is increasing considerably. In this case, 
again, higher wage rates have attracted many employed workers. Kalamazoo, 
like Grand Rapids, has not been as active industrially as many other Michigan 
cities, and has consequently lost some skilled workers both to Detroit and to 
northern Indiana. 

The analysis of interstate claims contained in table 4 substantiates these indica- 
tions of the destination of migratorj'^ workers from other States. During the first 
8 months of 1941 initial interstate claims received in the Detroit area (area No. 5) 
totaled 6,146, or 38^^ percent more than the number received in the comparable 
months of 1940. During the same period, however, intrastate initial claims de- 
clined nearly 35 percent. Similarly, Saginaw reported an increase in initial claims 
of nearly 79 percent; Bay City, 35 percent; Ann Arbor, 53 percent; and Pontiac, 
85 percent. 

Section IV. Labor Dislocation Under the Defense Program 

Production quotas and shortages of various materials essential to the defense 
program will be responsible for a large volume of luiemployment in Michigan in 
the next several months, unless special steps are taken to avoid this waste of 
manpower by acceleration of defense production in the State's industrial centers. 

Because of the predominance of automobile manufacturing in Michigan's indus- 
trial structure, quotas established by the Office of Production Management to 



NATIONAL DEFENSE MIGRATION 7187 

limit the output of passenger cars and nonmilitary motor vehicles will have a 
serious impact on Michigan employment. A survey made in July showed that 
for the State as a whole, a 50 percent curtailment would eliminate 175,000 jobs 
in nondefense production by January 1942. Despite anticipated expansion of 
defense work, the July survey indicated net unemployment of 93,000 in January, 
even if it were assumed that all defense joljs were available to displaced automobile 
workers. 

Since the plan actually adopted calls for a more gradual curtailment of passen- 
ger-car production, the net dislocation of labor is expected to be less than was 
indicated by the July survey. However, the quotas already established, permit- 
ting national output of 817,000 units in the 4 months ending November 1941 and 
204,000 units in December, will reduce nondefense automotive employment much 
more rapidly than defense employment is now scheduled to increase. 

On the basis of surveys made in August and September (assuming 50 percent 
curtailment and a 40-hour week in nondefense automotive production) it is esti- 
mated that net unemployment in Januarv 1942 will affect at least 54,000 workers 
in the Detroit area, 17,000 in Flint, and from 4,000 to 6,000 in each of the other 
three principal automotive centers — Pontiac, Lansing, and Saginaw. 

This dislocation of labor — which will exist after taking into account the antici- 
pated gains in defense employment — may result in a wave of migration away from 
Michigan industrial centers unless special measures are taken to create additional 
jobs or guarantee some other kind of economic security for the displaced workers. 

Additional unemployment will occur in numerous Michigan localities because 
of the inability of nondefense manufacturers to obtain materials or needed equip- 
ment. Regardless of whether or not formal quotas are actually established for 
such consumers' goods as refrigerators, washing machines, furnaces, and hard- 
ware, the producers of such commodities are almost certain to have output cur- 
tailed as material shortages become more severe. 

Some of the dangers inherent in this potential migration, and governmental 
measures which might be taken to reduce the dislocation, are discussed in sections 
V, VI, and VII of this sta,tement. 

The present section discusses surveys which have recently been completed in 
an attempt to determine the extent and duration of unemployment of factory 
workers which may result from the production restrictions iinposed under the 
defense program, both for the State as a whole and for major individual communi- 
ties. The discussion includes (a) a statement of the limitations of the surveys, 
(b) a summary of the findings based on them, and (c) a brief statement of the 
estimated trends in the individual areas for which surveys have been prepared 
to date. 

A. LIMITATIONS OF SURVEYS 

All of the surveys are subject to some possible revision based on corrections 
which may be submitted by the employers contacted, but even if no corrections 
of this type were necessary, the surveys would be subject to the following general 
limitations: 

1. Trends in defense employment are based chiefly on estimates of labor needs 
for contracts alread,v received. If additional contracts are awarded in time or 
if delivery can be scheduled for earlier dates, unemployment will of course be 
reduced. 

2. In most instances, it has been necessary to assume that all workers laid off 
from nondefense jobs will be occupationally transferable to meet expanding 
defense needs. To the extent that such transferability is limited, actual dis- 
location of labor will be greater than estimated in the surveys. Efficient training 
programs will be extremely important in reducing the significance of this factor. 
Without them, in-migration of specific types of workers may be needed to man 
defense plants, even while local workers are unemployed because of nondefense 
curtailment. 

3. The estimates obtained in the surveys are generally limited to data on factory 
employment. The full volume of unemplojanent will be greater because of the 
indirect effects of unemployment in basic manufacturing industries on activity in 
dependent economic fields such as trade and service. In some cases, the arbi- 
trarx' restriction of production will have additional special effects, causing lay-offs 
for example, in advertising which would not be ordinarily affected to the same 
degree. Booming industrial activity in areas not suffering from defense unem- 
ploj'ment, on the other hand, will tend to offset these indirect effects of unem- 
ployment in selected manufacturing fields by maintaining a high demand level 
on a national scale for such nondurable consumers' goods as food and clothing. 



7188 DETROIT HEARINGS 

4. Local unemployment conditions may be relieved by out-migration, but this 
movement of workers may eventually handicap defense production, which is not 
scheduled to reach its peak until several months after nondefense lay-offs are 
forced by quotas or material shortages. Since the existence of material shortages 
is based largely on the high level of current consumption, although some controls 
have been established to conserve materials for future defense use, it is hardly 
possible that total employment in the country will undergo any prolonged decline. 
This conclusion is especially consistent with the fact that production of materials 
has been substantially expanded and that some defense production processes 
apparently require a greater ratio of manpower to equipment than the nondefense 
mass-production processes which are being curtailed. Unless surpluses of certain 
materials exist alongside of shortages of strategic materials, a high level of national 
employment might lead to out-migration of workers from some of Michigan's 
industrial centers in which they will be sorely needed as defense production 
reaches its full stride in these areas later. 

5. The effect of unemployment resulting from material shortages in nonauto- 
motive industries is not fully represented in these estimates, because of the in- 
ability of individual concerns to predict the exact time or extent to which such 
lay-offs would occur. However, in many nonautomotive communities, such dis- 
location may assume serious proportions. 

B SUMMARY OF SURVEY FINDINGS 

An analysis of estimated employment trends in "potential defense" manufac- 
turing industries in the entire State was made in July 1941, prior to the announce- 
ment of the official quotas for nonmilifcary automobile production for the first 4 
months of the 1942 model year. Employers were asked to estimate their labor 
needs on the basis of assumed quotas 20 percent and 50 percent under 1941 pro- 
duction. Covering 296 plants with about 95 precent of the total of 411,000 em- 
ployees in automotive and allied industries and 508 plants with 140,000 employees 
in nonautomotive manufacturing, this survey furnishes the only available data 
on the State as a whole. 

Assuming 50 percent curtailment from the 1941 model year and complete trans- 
ferability of displaced automobile workers to new defense jobs, the July survey 
indicated that 67,000 workers from autmobile and related manufacturing would 
be unemployed in September, 100,000 in November, and 82,000 in January. 
From 41 1,000 in July, nondefense employment in automotive and allied industries 
would decline to 314,000 in September (down 97,000), 249,000 in November 
(down 162,000 from July), and 236,000 in January 1942 (down 175,000 from July). 
Defense increases in these industries would fall short of offsetting the declines by 
74,000 in September, 110,000 in November, and 93,000 in January. 

With a 75-percent cut in effect, it Vv^as estimated in July that about 260,000 
nondefense jobs would be eliminated by January 1942, with net unemployment 
amounting to 176,000 at that time. Although no 75-percent cut is apparently 
planned for January, this estimate does provide a rough approximation of the 
amount by which defense employment would need to increase between January 
and the time when a 75-percent curtailment is actually adopted, if very severe 
unemployment conditions are to be avoided. 

Reasonable allowance for practical limits on occupational and geographical 
transferability of released automobile and related factory workers was con- 
sidered to require addition of about 15-20,000 to the minimum figures on net 
unemployment which were estimated in the July survey. 

However, even the estimates of net unemployment reached in this survey are 
obviously much too high for September and November because the actual pro- 
duction cut was 26.6 percent instead of 50 percent. The established quota might 
reduce the net displacement of nondefense workers to about 20,000 in September 
and 50,000 in November, depending upon the production schedules followed in 
turning out the full 4-month quota. Tending to reduce both of these figures still 
further, and the January estimate as well, is the fact that sizable additional de- 
fense contracts have been received since July and work on previous contracts has 
been progressing more rapidly than was expected in some important cases. By 
the end of November, however, there are some indications that unemployment 
will be greater than the estimate of 50,000 because of gradual lay-offs as the quota 
for August-November may be filled by various plants before the end of the period. 

The local community surveys made in August and September provide more 
reliable estimates of employment trends, since they were completed after the 
quota for the first 4 months of the 1942 model year was officially announced. 



NATIONAL DEFENSE MIGRATION 7189 

For all of the local labor market area surveys, unemployment estimates are 
based on a comparison of anticipated employment totals with employment at 
the end of May 1941. This base was used to avoid the distortion of current 
figures by the seasonal lay-offs for model change-over purposes. 

On the basis of a 40-hour week on nondefense automotive production, these 
surveys indicated that net unemployment of factory workers on November 30, 
might reach 41,000 in Detroit, 8,000 in Flint, at least 3,400 in Grand Rapids, 
2,800 in Lansing, 2,400 in Fontiac, and perhaps 1,400 in Saginaw. A small 
decrease (less than 500) would be expected to occur in Muskegon because of the 
automobile quota, but lay-offs because of material shortages, especially for re- 
frigerator and metal furniture production, may create an unemployment total in 
excess of 2,000-3,000 in this area. In other areas as well, particularly Grand 
Rapids, shortages of materials for nondefense manufacturing may force lay-offs 
for many workers, but virtually all employers contacted, who had any expecta- 
tion of material shortages, found it impossible to estimate the time, extent, or 
duration of consequent pay-roll reductions. The situation with respect to ma- 
terial procurement possibilities is too indefinite, but it appears quite likely that 
most of the labor market areas surveyed to date will experience substantial 
lay-offs of workers now using critical defense materials on nondefense production. 

By January 1942, still assuming a 40-hour week on nondefense production of 
automobiles it is estimated that output of 200,000 units would mean net unem- 
ployment of at least 55,000 workers in the Detroit area, 17,000 in Flint, 5,600 
in Pontiac, 4,700 in Lansing, 4,000 in Saginaw, 3,600 in Grand Rapids, and 700 
in Muskegon. These estimates take anticipated increases in defense employment 
into account, including increases expected in automotive and nonautomotive 
plants; but lay-offs due directly to material shortages were not estimated for 
reasons already explained. 

The above figures for Detroit are based on reports from a sample of 45 major 
concerns, which included the bulk of the area's automotive employment, but 
only part of the nonautomotive concerns in potential defense industries. Where 
the sample is expanded to furnish an estimate for all potential industries (firms 
regularly contacted by the Employment Service to determine their labor needs) 
the estimate of net unemployment is reduced somewhat, because of additional 
defense prospects in nonautomotive plants not included in the 45-company 
sample. This expansion of the "sample" would indicate net unemployment of 
34,000 in November and 46,000 in January. Because of the practical limitations 
or transferability from automotive to nonautomotive plants, and the probability 
that additional unemployment will result from material shortages, the estimates 
based on the 45-firm sample (41,000 in November and 55,000 in January) 
probably come closest to predicting the actual situation. 

With a 32-hour week in effect for nondefense production of motor vehicles, 
November factory employment would be only slightly lower than in May 1941. 
In January, however, even with this over-optimistic assumption, declines from 
May would occur in each of the 5 principal automotive centers, amounting to 
18,000 in Detroit, 12,000 in Flint, 2,700 in Lansing and Saginaw, and 1,700 in 
Pontiac. 

In the Bay City-Midland area, expected increases in defense employment are 
more than sufficient to offset lay-offs resulting from the automobile quotas. As- 
suming that displaced automobile factory workers can be absorbed into new 
defense jobs, no increase in unemployment is expected in the area in either 
November or January. In fact, total industrial employment should have risen 
by at least 1,500 from May to November. 

C. ANTICIPATED UNEMPLOYMENT IN INDIVIDUAL LABOR MARKET AREAS 

Since the passenger-car quota for August-November was announced on August 
21, surveys have been completed to determine the effect of this quota and material 
shortages on employment in eight industrial areas in Michigan: Detroit, Flint, 
Pontiac, Saginaw, Muskegon, Bay City-Midland, Lansing, Grand Rapids. A 
brief summary of the findings of each of these surveys follows. The Detroit 
summary below is based on figures from a revision being issued under date of 
September 18, 1941. 

Detroit. 

In July, at least 130,000 workers in the Detroit area were already engaged in 
defense production. But in spite of the enormous value of defense contracts 
already received by Detroit establishments, substantial unemployment may be 



7190 



DETROIT HEARINGS 



expected in the city during the next several months unless stop-gap contracts are 
awarded, work on present contracts is pushed ahead of schedule, or the use of 
manpower is diluted by operating nondefense plants only 32 hours per week. 
Even with a 32-hour week on nondefense automotive production, thousands of 
workers will be unemployed under the more severe curtailment program which 
will undoubtedly be in effect in January. 

Major cause of the unemployment expected in the Detroit area is the quota for 
nonmilitary automobile production, but serious lay-offs are also likely to result 
from shortages of materials for various metal and rubber processing production 
of other nondefense goods. These shortages may even force passenger-car pro- 
duction below the quota; already, material delivery delays were reported to have 
slowed down last week's seasonal rise in automobile output. 

For the 45 corporations contacted in the recently completed survey of the effect 
of the automobile production quotas and material shortages in Detroit, unemploy- 
ment would result in November for a net total of at least 41,000 of the 315,000 
factory workers employed by these firms on May 30, 1941, if nondefense auto- 
motive manufacturing is operated on the basis of a 40-hour week. By January, 
if the national quota is about 200,000 passenger cars, the net total unemployment 
on this basis would reach 55,000 factory workers (table 5). 

Table 5. — Estimated trends in defense and nondefense factory employment, Detroit 
area, totals for selected automotive producers and suppliers ' and nonautomotive 
firms, May SO, to Nov. 30, 1941, and Jan. 31, 1942 

40-HOUR WEEK ON AUTOMOTIVE NONDEFENSE IN NOVEMBER AND JANUARY 



Type of firm and employment 


Factory employment on 
specified dates 


Net change from 
May 30, 1941 to— 


May 30, 
1941 


Nov. 30, 
1941 


Jan. 31, 
1942 


Nov. 30, 
1941 


Jan. 31, 
1942 


Total, all selected firms -- 


314, 577 


273, 127 


260, 073 


-41, 450 


-54,504 




Defense .. 


72, 782 
241, 795 


119,293 
153, 834 


126, 558 
133, 515 


+46,511 
-87, 961 


+53 776 


Nondefense . -_ ... 


-108,280 




5 automotive producers, total . . 


216, 868 


175, 006 


164, 180 


-41,862 


-52, 688 




Defense 


29, 292 
187, 576 


56, 766 
118, 240 


61, 651 
102, 529 


+27,474 
-69, 336 


+32, 359 
-85,047 


Nondefense. ... 




23 automotive suppliers i total 


68, 516 


62, 075 


57, 357 


-6,441 


— 11,159 






Defense 


22, 826 
45, 690 


33, 432 

28, 643 


33, 357 
2 24, 000 


+10, 606 
-17,047 


+10, 531 
—21 690 


Nondefense 






17 nonautomotive firms, total _. . 


29, 193 


36, 046 


38, 536 


+6, 853 


+9, 343 




Defense -. 


20, 664 
8,529 


29, 095 
6,951 


31, 550 
6,986 


+8, 431 
-1,578 


+10, 886 


Nondefense 


— 1,543 







32-HOUR WEEK ON AUTOMOTIVE NONDEFENSE IN NOVEMBER AND JANUARYS 



Total, all selected firms 

N ondefense 

Automotive producers, total 

Nondefense 

Automotive suppliers, total. 

N ondefense 

Nonautomotive firms, total. 
Nondefense. _ 



314, 577 


305, 298 


286, 627 


-9, 279 


241,795 


186, 005 


160, 069 


-55, 790 


216, 868 


200. 017 


184, 734 


-16,851 


187, 576 


143, 251 


123, 083 


-44, 325 


68, 516 


69, 235 


63, 357 


+719 


45, 690 


35, 803 


30, 000 


-9, 887 


29, 193 


36, 046 


38, 536 


+6, 853 


8,529 


6,951 


6,986 


-1,578 



-27, 950 
-81, 726 
-32, 134 
-64, 493 
-5, 159 
-15,690 
+9, 343 
-1,543 



1 Producers of automobile bodies, parts, supplies, equipment. 

2 Partly computed by assuming same trend (for plants with 16,957 workers on May 30) as for remainder 
of "suppliers" and 5 automotive producers. 

3 Computed by adding 25 percent to nondefense automotive employment estimates based on 40-hour 
week, except for 2 producers of finished automobiles from whom actual estimates were received. 



NATIONAL DEFENSE MIGRATION 



7191 



Table 6. — Estimated change in Detroit employment from May to November 1941 1 
and to January 19^2, on the basis of a 40- and a 32-hour week for nondefense 
work 





Factory 
equip- 
ment, 

May 30, 
1941 


Estimated change on basis of specified 
work weeli for nondefense auto output 


Item 


40-hour week 


32-hour week 




To Nov. 
30 


To Jan- 
uary 1942 


To Nov. 
30 


To Jan- 
uary 1942 


Total - - - 


385, 400 


-34, 300 


-45, 700 


-700 


-18,200 








117, 000 
268, 300 


+65, 400 
-99, 700 


+76, 200 
-121,900 


+65, 400 
-66, 100 


+76, 200 




-94, 400 








216, 900 


-41, 900 


-52, 700 


-16,900 


-32, 100 








29,300 
187, 600 


+27, 500 
-69,400 


+32, 400 
-85, 100 


+27, 500 
-44, 400 


+32, 400 


Nondefense . _ - - - . . .- 


-64, 500 








97, 200 


-9, 100 


-15,800 


-600 


-8,900 








36, 800 
60, 400 


+17, 100 
-26, 200 


+ 17,000 
-32,800 


+ 17, 100 
-17,700 


+ 17,000 


Nondefense .- ..- -- 


-25,900 






Nonautomotive producers . -- -. 


71, 300 


+ 16,700 


+22, 800 


+ 16,700 


+22,800 






Defense - 


51,000 
20,300 


+20, 800 
-4, 100 


+26, 900 
-4, 100 


+20, 800 
-4,100 


+26, 900 


Nondefense .. - . .- 


-4,100 







Since the automotive quota for December is only 204,000 units and defense em- 
ployment would be several thousand below the level anticipated for January, 
unemployment in December will probably be higher than the estimates developed 
for January in this Detroit survey. Furthermore, it is also in December that the 
full effect of material shortages on other nondefense production is expected to 
make itself felt, as many manufacturers have accumulated stocks of supplies 
which, together with at least small shipments in the meantime, may tide them 
over until about December. 

The anticipated net decline in employment for the selected firms from May to 
November will result from a drop of 88,000 (from 242,000) in nondefense employ- 
ment, offset in part by an estimated increase of 47,000 (from 73,000) in defense 
labor needs. 

By January, the 45 selected firms expected nondefense employment to be about 
108,000 below the May 30 level, while their new defense jobs would permit absorp- 
tion of only 54,000 of the released workers. 

The 5 major producers of finished automobiles in the area (General Motors, 
Ford, Chrysler, Packard, Hudson) expected a net decline of 42,000 by November, 
slightly more than the net total for all of the 45 firms contacted. While their 
defense employment is increasing by 27,000 to nearly double the May 30 total, 
these 5 corporations expect their nondefense employment in the area to fall from 
187,000 in May to 118,000 in November. The nondefense decrease of 69,000 for 
these firms by November accounts for about 80 percent of the total estimated drop 
in nondefense employment for the 45 establishments reached in the survey. From 
May to January, these 5 producers reported an estimated increase of 32,000 in 
defense employment and a nondefense drop of 85,000. 

For the 23 automotive suppliers contacted, still on the basis of a 40-hour week 
for nondefense operations, a net decrease of 6,400 was expected by November, 
and bv January these firms expected to employ 11,000 fewer workers than they 
did on May 30, 1941. 

The survey revealed that the nonautomotive firms contacted would experience 
a net employment increase of 6,900 by November and 9,300 by January. Of the 
29,200 May employees of these 17 nonautomotive establishments, 20,700 were 
already on defense work; and the number of defense workers was expected to rise 
to 29,200 by November and to 31,600 by January 1942. 



7192 DETROIT HEARINGS 

On the basis of a 32-hour week for workers on nondefense automotive production, 
the net decreases in factory employment of the 45 selected companies would 
amount to 9,300 by November 30 and 28,000 by January 31, 1942. 

Expansion of the figures for the sample of selected firms to reflect the total for 
virtually all of the area's manufacturers of durable consumers' goods and of pro- 
ducers' goods (with about 385,000 factory employees in May) gives estimated 
declines of 34,000 by November 30 and 46,000 by January, on the basis of a 40- 
hour week for passenger-car production. On a 32-hour schedule for nondefense 
automotive production, the expanded figures reveal a net decline of less than 1,000 
by November 30, but a drop of more than 18,000 by January 1942. 

Flint. 

Unless additional defense work is allocated to Flint, this city will probably 
suffer a greater relative amount of defense unemployment than any other in the 
State. Virtually 100 percent automotive and General Motors, Flint's manu- 
facturing employment is expected to decline by 8,100 by November with a 40-hour 
week, although no decrease would occur with a 32-hour week. By January with 
a 50 percent curtailment of passenger-car production, the drop would be 16,800 
on a 40-hour basis or 11,700 on a 32-hour basis. Of 45,000 workers employed by 
the 6 General Motors plants in May, only 1,800 factory workers were in defense 
production. Under present contracts, defense employment is expected to rise 
to about 4,000 by November. By January with 600 workers added to the No- 
vember defense total, defense employment in the area will be up to about 4,600, 
provided that there is no decrease at A. C. Spark Plug as this division completes 
work on present contracts. 

Pontiac. 

Less serious in its effect on employment in Pontiac than in Flint, the automobile 
production quota will nevertheless cause a sizable amount of unemployment 
unless the workweek on nondefense production is reduced to 32 hours per week or 
defense output is stepped up. By November 1, with employees on nondefense 
production working 40 hours per week, the passenger-car quota would mean net 
unemployment for approximately 2,400 of the 24,000 wage earners of the 8 plants 
contacted. A decline of approximately 3,800 in nondefense employment of wage 
earners would be partly offset by an anticipated increase of about 1,400 in de- 
fense production. Of the expected drop in nondefense employment, the 3 largest 
automotive plants account for 3,700, while the expected increase in emploj^ment 
on defense production by 1 of these plants accounts for 1,100 of the anticipated 
rise in defense employment. In January 1942 a 40-hour week for nondefense 
automotive workers, combined with a 50 percent curtailment of output from 1941 
levels, would mean a net displacement of at least 5,600 workers. With non- 
defense workers on a 32-hour week schedule, total industrial employment in 
Pontiac would actually increase at least 1,250 by November, but would be down 
by at least 1,700 in January. Because of the predominance of automobile manu- 
facturing in the area, production quotas on other items than motor vehicles would 
have an insignificant effect in Pontiac, and material shortages are not expected 
to force lay-oflFs, in addition to those which miglit result from the passenger-car 
quota, for any of the area's 18,000 to 20,000 nondefense workers. 

Saginaw, 

With 35 percent of Saginaw's employment of 18,200 workers in potential defense 
industries already devoted to defense production and with the possibility that some 
nondefense production now done in other areas will be transferred to Saginaw, 
it is possible that no serious dislocation will occur in this area. 

However, if nondefense automotive workers are on a 40-hour schedule, approxi- 
mately 1,350 of the 13,000 workers employed by the 6 plants accounting for 
practically all of the city's automobile workers (5 General Motors and 1 Eaton 
Manufacturing) may be unemployed in November, while employment of the 
other manufacturers in the area remains virtually unchanged from the May 31 
total of about 9,000. A decrease of about 3,000 in civilian automotive employ- 
ment would be only partly offset by an increase of about 1,650 in defense employ- 
ment, with about half of this rise occurring at a single plant operated by an 
automobile producer. In January 1942 with a 50-percent reduction in passenger- 
car output and a 40-hour week, factory employment would be at least 4,000 under 
the May 31 level, as defense expansion would permit transfer for a maximum of 
only 1,800 of the 5,800 workers who would need to be released. Most of the 
nondefense decline would be at a single plant which would not need 3,300 of its 
6,400 May employees. With a 32-hour week for passenger -car production. Sag- 



NATIONAL DEFENSE MIGRATION 7193 

inaw's factory employment would increase by about 700 to November and decline 
by approximately 2,750 in January 1942. Transfer of nondefense production 
from General Motors plants in New York (Tonawanda and Syracuse) may 
eliminate lay-offs of about 550 workers at 2 General Motors plants in Saginaw, 
which would otherwise be necessary under the 27.6 percent cut by November, 
but these transfer plans are not yet crystallized. While 15,000 of Saginaw's 
22,000 factory workers are still engaged in nondefense production, no significant 
lay-offs are expected because of other quotas or materials shortages, partly 
because the area's nondefense, nonautomotive employment of about 4,000 to 
5,000 is based largely upon agricultural products of the Saginaw River Valley. 

Muskegon. 

As only about 3,700 of the Muskegon area's 9,000 workers in automotive plants 
are in nondefense production, the passenger-car quota will have relatively little 
effect, causing net displacement of only 300 workers by November and 700 by 
January. But a 50-percent reduction of refrigerator output would force Borg- 
Warner's Norge Division to lay off about 1,400 of its 3,500 employees, unless the 
plant's efforts to secure defense awards for ammunition cases, water heater 
shield, etc., are successful. Although the relatively high ratio of about 45 percent 
of the area's 23,600 manufacturing workers is already devoted to defense produc- 
tion (with a total of 5,200 defense workers employed by Continental Motors, 
Campbell-Wyant & Cannon, Lakey Foundry & Machine, and Shaw Box, Crane 
& Hoist), material shortages may force lay-offs for several thousand nondefense 
workers, but no definite data are available except from 3 plants which believe that 
lack of materials might necessitate lay-offs for about 600 workers. 

Bay City and Midland. 

Compared with the pre-change-over total of about 13,000 workers, the total 
employment of the plants contacted wiU be 1,450 higher by November, assuming 
that the 850 workers released by the 2 major automotive plants can be absorbed 
by the nonautomotive plants whose total employment is expected to rise by 2,300 
(from 9,400 at the end of May). But most of the displaced automobile workers 
will not be suitable for transfer to the new defense jobs in the nonautomotive 
plants, with the possible exception of some unskilled jobs at the plants of the 
Dow Chemical Co. in Midland and Bay City and a few skilled jobs at the Defoe 
Boat Works. Even by January, an expected decrease of about 1,600 in non- 
defense automotive employment would be more than offset by the anticipated 
increase in defense work by November, but the fact that other workers may 
already have the new jobs before the automobile workers are released, as well 
as the occupational transfer difficulty, may create unemployment for a number 
of the workers released from automotive plants. The employment of about 
8,000 to 9,000 workers in plants not contacted in the survey is not expected to 
change substantially during the remainder of the year. Although expanding to 
manufacture airplane engine parts, the Chevrolet plant will probably not absorb 
a significant number of workers by January. Estimates of automobile worker 
displacement were based on a 40-hour week, and a 32-hour week would virtually 
eliminate the need for lay-offs by November and substantially reduce the dis- 
placement in January. 

Lansing. 

With a 40-hour week, current production quotas and a 50-percent automotive 
quota in January, employment in Lansing is expected to decline by approximately 
2,750 by October 30 and 4,700 by the end of January 1942 (from a May total of 
about 22,000). A decline of nearly 8,400 in nondefense employment by January 
will be partly offset by a prospective increase of about 3,700 in defense employment. 
With nondefense work on a 32-hour week basis, net displacement in January 
would be reduced to 2,700. Expansion of defense employment at Nash-Kelvi- 
nator between January and August 1942 is the only presently foreseen prospect 
for easing the situation in 1942. This firm expects eventually to employ a peak 
of about 8,000 workers on airplane propellers and engine parts in Lansing. Nearly 
all the labor displacement by January 1942 will be at 2 General Motors plants, 
Oldsmobile and Fisher Body (13,000 nondefense workers in May); for all other 
plants combined, defense employment will increase more than the prospective 
nondefense decline. Unemployment of automotive workers may be greater than 
estimated above as many released workers wiU not be transferable to new defense 
jobs without considerable training. 



7194 DETROIT HEARINGS 

Grand Rapids. 

Because of the extremely high proportion of Grand Rapids industrial employ- 
ment which is confined to a large number of small plants, it is particularly difhcult, 
in a very hasty survey, to obtain an entirely valid projection of employment 
trends in this labor-market area. However, the 17 plants contacted in the .sur- 
vey employed about 40 percent 'of the area's total of api)f6ximately 40,000 manu- 
facturing workers. For these selected plants, the trend in total employment is 
expected to be downward, with the total decreasing by 3,400 by November and 
3,600 by January 1942. For automotive plants in the area with about 9,000 
workers in May of 1941 a net decline of about 1,300 is expected by November, 
and increases in defense employment would prevent any sizable additional decline 
Ijetween November and January. 

The most important prospective employer of defense workers is the Hayes 
Manufacturing Co., which holds contracts for airplane fusela,ges, parachutes, and 
stampings, and expects to have about 2,100 more workers on defense products 
by January than it had on May 30, 1941. However, about one-quarter of the 
workers needed for defense output will be transferred from nondefense production 
of house trailers. 

Nonautomotive producers in the area who were contacted in the survey esti- 
mated a net decline of about 2,100 by November and 2,300 by January. More 
than half of these anticipated declines were estimated for the Nash-Kelvinator 
plant (refrigerators). Unless this firm is able to secure defense contracts which it 
has unsuccessfully sought for shell or bomb cases, water containers, and field 
stoves, at least 1,300 of the 3,500 workers employed by the establishment in May 
will need to be released for a lack of materials, whether or not a production quota 
is established for refrigerators. 

Several thousand more workers in,cluding some of the 10^000 furniture factory 
employees, may find themselves imemployed in Grand Rapids because of material 
shortages and the relatively small amount of defense work in the area. 

Only 13 percent of the 26,500 July employees of 87 Grand Rapids plants 
regularly contacted for reports of anticipated labor needs were engaged in defense 
production, compared with 29 percent of the State total of 682,600 workers in 
potential defense industries. Particularly hard-hit in Grand Rapids may be the 
numerous jjlants manufacturing hardware (with a total of about 3,500 employees), 
since the equipment used for making small castings and performing plating and 
polishing work apparently cannot be transferred to defense production. Recently 
announced priorities for materials used in construction of homes valued at less 
than $6,000 may reduce lay-offs among these firms. However, some special 
arrangement might need to be made to give priority ratings, perhaps on a rough 
proportionate basis, to these small firms in order to overcome the difficulty in 
identifying the final consumer of their products because of their system of selling 
through jobbers. 

Section V. Social and Economic Problems Which Have Resulted or May 
Result From Migration 

The movement of industrial workers, or other seeking defense factory jobs in 
Detroit and the other areas in which defense employment has been expanding, has 
created a number of problems which have tested the community facilities of such 
areas. Since more extensive statements on these problems will be submitted by 
other witnesses at these hearings, I will merely mention some of them briefly. 
In the absence of new housing construction, migration to defense centers creates 
pressure on housing facilities — with overcrowding, trailer settlements, the mush- 
room growth of shacks and substandard dwellings, and upward pressure on rentals 
for houses and apartments which are already available. 

In Warren township, just north of Detroit, we have seen these conditions in an 
extreme form, and they have brought with them dangers resulting from inade- 
quate sanitary facilities, insufficient schools, and lack of adequate police protec- 
tion and other social services. 

There are other problems which might be mentioned; among them the pressure 
on roads and transportation facilities which results from the crowding of greatly 
increased population into areas in which there has been no adequate development 
of facilities to handle this population. The construction of new highways, and 
the improvement of existing roads and highways, is vital!}' necessary in order to 
permit movement between existing residential areas and new defense plants, and 
to prevent the growth of ramshackle, unhealthy communities, which will be fit 
only to be torn down after the defense boom has passed. 



NATIONAL DEFENSE MIGRATION 7195 

An entirely different set of problems will have to be faced in connection with 
the possible migration of thousands of workers away from industrial centers which 
may occur if we are unsuccessful in keeping the dislocation of labor at an absolute 
minimum during the transition from civilian to defense production. 

MIGRATION OF WORKERS UNEMPLOYED BECAUSE OF PRODUCTION QUOTAS OR MATE- 
RIAL SHORTAGES 

In spite of accumulated seniority rights and eligibility for unemployment 
compensation it is quite probable that many of the workers who are laid off 
because of the automobile curtailment, other production quotas or material 
shortages, will leave the areas in which they were employed prior to the model 
change-over. Rumors of immediate opportunities for work in defense plants in 
other areas, including locations in other States, would probably be easily sufficient 
attraction for numerous unemployed workers. The system of interstate benefit 
payments makes it possible for them to obtain unemployment compensation, 
whether or not they remain in the area in which they were employed. Another 
reason which leads to the conclusion that many workers would not hesitate to 
migrate, even if temporarily unemployed, is the fact that many of them have 
probably only recently migrated into the Michigan industrial centers in which 
they are now employed. 

If out-migration of displaced workers does occur on a large scale, several in- 
dustrial centers in the State may be faced with a shortage of workers by late 1942. 
In Detroit, it is estimated that increases in defense employment between January 
and June 1942 would be greater than the net number of workers who will be un- 
employed in January because of the automobile-production quotas, even with a 
40-hour week, for nondefense automobive production. Large increases in defense 
employment, especially for production of airplanepropellers and airplane engine 
parts by the Nash-Kelvinator (the anticipated peak defense employment this 
firm's plan's in Lansing is 8,000), may very easily create a general shorta^ge of 
woi kers in this area by the middle of 1942. 

Strong efforts should therefore be made to reduce unemployment of nondefense 
workers, to accelerate employment on defense work, or to provide some adequate 
system for the reducing of migration which might otherwise result from unem- 
ployment due to production quotas or material shortages. 

A high national production level, prevailing at the same time that substantial 
unemployment exists in Michigan industrial centers because of quotas and mate- 
rial shortages, would presumably encourage even more out-migration than would 
ordinarily occur in a nationally depressed economy. It would also cause some 
alteration in the direction of the out-migration. 

Instead of going back home to Tennessee or to other areas where living costs 
are lower and unemployment compensation payments have greater purchasing 
power, many workers may be expected to go to some of the highly active labor 
market areas in the country, especiallv those where large defense plants have been 
built in the face of a relatively small lo^al labor supply. This change in the des- 
tination of workers separated from ncniefense jobs in Michigan would probably 
make it much more difficult than usual to get them to return to this State when 
they are again needed for defense production here, in spite of higher wage rates. 
In fact, if they did find jobs in defense work elsewhere, there would be little 
justification under the defense program for seeking their return. But from all 
points of view, the best solution is to develop a sufficient demand for labor, in 
their present communities, to prevent the need for any outward migration. 

Section VI. The Need for State Action — Measures to Reduce the Dis- 
location OF Labor 

During this period in whicli Michigan's industries are making the transition 
from civilian to defense production, one of the State government's most important 
tasks will be to develop policies and take positive action to prevent the damaging 
effects which might otherwise result from dislocation of labor. The curtailment 
of passenger-car production will create a major unemployment problem during 
the next few months. In addition to this problem, we must face the certainty 
that many other civilian industries will have their production curtailed or inter- 
rupted because of inability to obtain materials or equipment whicli are of critical 
importance in the defense program. 

This situation, as was pointed out by Governor Van Wagoner this morning, 
creates a threefold task for government — not only the State government, but also 



7296 DETROIT HEARINGS 

the various Federal agencies, such as Office of Production Management, which 
can help in easing the shock of this necessary transition. 

The first problem is to take every possible step to protect the economic security 
of workers who are temporarily displaced, and furnish them with some source of 
income until they can be back'to work on defense production. 

Our second task is to proceed energetically with a variety of measures which 
can speed up the expansion of defense jobs. This task will require the whole- 
hearted cooperation of Government, labor, and industry. 

Our third task is to discourage and prevent any further migration of workers 
to Michigan industrial centers at this time, since such migration will only multiply 
the problems which already exist. 

Without trying to cover all of the steps which might be taken, it is possible to 
mention a few possible lines of attack which may deserve further study. 

1. Unemployment compensation will furnish a first line of defense for many of 
the workers displaced from civilian production. From 80 to 90 percent of them 
will probablv qualify for benefits, but this protection is limited in several ways. 
The $16 maximum rate represents less than half the full-time wage for the majority 
of workers in several industries. Even this amount is paid only after a 2-week 
waiting period, and continued for not more than 18 weeks — with a maximum 
duration as low as 8 or 10 weeks for workers who have had irregular employment 
during the "base period." It is doubtful whether, with these limitations, the 
unemployment compensation system will be enough to keep Michigan workers 
in the cities where they will be" needed. An increase in the size of weekly pay- 
ments and the duration of benefits might be considered as one way of encouraging 
our labor force to remain in Michigan until defense jobs are available. Such an 
extension, as the Governor has pointed out, might be especially justified in the 
case of individuals who are undergoing vocational training which will qualify 

them for new jobs. ^ . . ,. .^, ,, -n>- • • 

2 The Michigan State Employment Service is cooperating with the Division 
of Contract Distribution in the Office of Production Management in studying 
areas where serious unemployment will result from production quotas. Where 
the need for such action is indicated these studies serve as a basis for short-cutting 
the normal procedure for alloting defense contracts so that available production 
facilities can be used for defense purposes. 

3. Where the existing facilities are not suitable for defense production, there is a 
possibility of assigning civilian priorities which will permit at least part of the 
present nondefense personnel to be kept at work. Since some consumers goods 
will be needed even during the defense program, it is only reasonable to allocate 
such production in such a way that no community will suffer inequitably from the 
dislocation resulting from the transition to defense work. . ■, 4. •■, a 

4. Management and labor in the automobile industry have worked out detailed 
arrangements which will give preference in new defense jobs to experienced workers 
who have acquired seniority in the regular operations of the industry. This 
program, while it will not increase the total amount of work available, will tend 
to give greater security to the older workers with family responsibilities and an 
established place in the community. , x- x 4. • 

5 The temporarily dislocated workers will be given greater incentive to stay m 
Michigan communities if it is possible to expand the existing programs for training 
workers in the special skills and occupations which will be needed m defense 
plants. Such programs will be more effective if arrangements can be worked out 
so that these workers can be paid at least a subsistence wage while they are being 

6 Some of the defense plants which are now operating only 5 days a week or 
are using less than three full shifts of workers, might be able to expand their em- 
ployment considerably where it is feasible to operate the plants 24 hours a day and 
7 days a week. In some cases such a schedule is impossible because of the time 
required for servicing and maintenance of machines, but where possible it would 
result in a gain of about one-third in the number of workers employed in defense 
production. The State employment service and various divisions of the Office of 
Production Management are at present developing methods of furnishing special- 
ized types of labor or equipment to such plants where a lack of either is hindering 
capacity production. . . 

7 Especially in some communities, the impact of production quotas and priori- 
ties will be felt most harshly by small employers who serve as suppliers or sub- 
contractors for producers of consumers goods. Partial solution of the problems 
immediately before us lies in the development of a systematic arrangement for 
bringing together the primary contractors and the small manufacturers who 



NATIONAL DEFENSE MIGRATION 7197 

might be able to perform part of the work involved in the prime contracts. That 
some progress is being made in this direction is suggested by yesterday's meeting 
in New York at which Floyd Odium, Director of Contract Distribution for the 
Office of Production Management, held a "defense clinic" to bring together the 
representatives of more than 100 large firms and spokesmen for hundreds of small 
machine shops and subsidiary manufacturers. 

8. The State and Federal Governments can and will help to minimize and 
shorten the unemployment resulting from priorities by thorough surveys of the 
defense possibilities of plants which are being most seriously affected by priorities 
and quotas. New rules on distribution of Federal contracts now permit a group 
of employers, in a given industry or community, to bid on a single contract and 
then divide the job up in accordance with their individual facilities. 

All of these programs and others which might be mentioned must be stimulated 
and coordinated with a single thought in mind, of making as many defense jobs as 
possible for Michigan workers and preventing economic waste of unemployment. 
We know that in the next year or two we cannot use as many men as in the past in 
production of automobiles, refrigerators, and consumers goods — but we cannot 
afford to have this manpower idle if there is any possible way of using it in further- 
ing our national policy of defense. 

(The following letter was received subsequent to the hearing:) 

Exhibit A. — Labok Force of Firms Supplying Automobile Makers 

Michigan Unemployment Compensation Commission, 

Detroit, October 21, 1941. 
Mr. Harold D. Cullen, 

Associate Editor, House Committee 

Investigating National Defense Migration, 

Washington, D. C. 
Dear Mr. Cullen: In response to your letter of October 16, we have assembled 
various data indicating "the proportion of workers, in the automobile industry, 
employed by manufacturers who supply final producers." Our figures are for the 
State of Michigan only. 

In July 1941 manufacturers in automobile and allied industries employed a 
total of approximately 497,000 workers, including workers on temporary lay-oBf 
because of shut-downs for model change-over purposes. Of this total, approxi- 
mately 310,000 workers were employed by the five major "final producers": 
General Motors, Ford, Chrysler, Hudson, and Packard. The remainder, com- 
prising employment of the "suppliers", represents approximately 38 percent of 
the total. 

Restricting the figures to nondefense employment, we find that the totals for 
the same period are 411,000 for the total, 276,000 for the "final producers," 
and 135,000 (33 percent) for the "suppliers". 

Even when the data are limited to nondefense employment, the figures for both 
"final producers" and "suppliers" include some employment which is in non- 
automotive production. However, while the five producers of finished automo- 
biles also manufacture such nonautomotive items as refrigerators and agricultural 
tractors, the "suppliers" probably have a higher proportion of nonautomotive 
employment. For this reason the above percentages may be slightly high. 
Very truly yours, 

Wendell Lund, 

Executive Director. 
By Paul L. Stanchfield, 
Chief, Research, Statistics and Planning Section. 



TESTIMONY OF PAUL L. STANCHFIELD— Resumed 

Mr. Stanchfield. We expect and anticipate a very serious disloca- 
tion of labor here in Michigan during the coming year. I think you 
may want to ask me more detailed questions about that later. But 
I would like to say, as an introduction to this discussion, that when 
we talk about an estimate of the number of people who are going to 



7198 DETROIT HEARINGS 

be unemployed on a certain date, we are talking about something that 
we hope won't really happen. In other words, we are talking about 
the situation which would occur if we don't manage to take certain 
steps that will help to cushion the blow. 

Possibly additional defense contracts can be brought m. Possibly 
production schedules can be advanced. Possibly the impact of mate- 
rial shortages and various other causes of unemployment can be 
cushioned by special treatment. Therefore, what is presented here 
is an analysis of what would happen if the anticipated trend of non- 
defense employment goes down to the extent that would be indicated 
by our present figures, and if there is no additional defense work com- 
ing into Detroit and the other industrial centers of Michigan, beyond 
that which is already in sight. 

Now, the paper, as you have probably noticed, is divided into six 
sections. The first of these points out that throughout the period 
in which Michigan's mass industries have been expanding, migration 
has been a fairly important source of labor supply for the major 
industrial centers of this area. 

LABOR SUPPLY DEPENDENT UPON IMMIGRATION 

About a quarter of the workers in Michigan were born in other 
States and nearly a fifth in foreign countries. That is according to 
the 1930 census; and especially during the decades between 1910 and 
1930 it would have been impossible to find an adequate labor supply 
for our growing factories and mass-production industries without the 
movement of large numbers of workers into these cities. 

Now, that migration movement really has produced some of the 
permanent population of the State, but it remains true that Michigan's 
industrial centers have a very definite drawing .power for workers 
from the rural areas of this State or from the sections of other States 
from which we draw our labor supply. 

URBAN-TO-RURAL MOVEMENT IN DEPRESSIONS 

That trend of migration is reversed, in general, during depression 
periods. During the depression period, when jobs grow scarce or 
when wages are lowered, there is some tendency for workers to move 
away from the industrial centers back to rural sections of Michigan, 
or back to the other States in which they have homes or from which 
they originally came. 

Not all of that is a permanent movement. As I testified at Chicago, 
we find that over half of the unemployment compensation claimants 
who went from Michigan to other States durmg the 1938 depression 
came back again to Michigan and worked here when jobs were avail- 
able in 1939, so that we have a certain pattern of movement into the 
industrial areas at the time when the jobs are there, and a movement 
away at the time when the jobs are not there. 

During the past year we have seen a rather definite stimulus to 
migration, resulting not so much from the policies of employers as 
from the fact that people in other States and other sections of this 
State have heard a great deal about potential defense jobs, new plants, 
expanding employment in Michigan industrial centers. 



NATIONAL DEFENSE MIGRATION 7199 

They knew the wages are high here. They have heard there is a 
great deal of defense work in Michigan. As a result, workers have 
moved in. A great number of them have not actually found jobs in 
this area, but the figures which we present indicate a sizable flow of 
imemployed workers, registering at the employment offices of Detroit 
and Flint and Saginaw and various other automobile centers. 

We do find some evidence that unemployed workers are filing claims 
in Michigan against the unemployment compensation funds of other 
States, again showing that after losing their jobs elsewhere, they have 
tended to come here in the hope of finding work. And we find, 
finally, indication that some of these migrants have received jobs, 
because in the 15 months since January of 1940, 60,000 workers who 
were not working in Michigan at that time and who originally received 
their social security numbers in other States have found work here, at 
least temporarily. However, a good many of those apparently merely 
found temporary or stop-gap jobs, and moved away to other areas. 

PRIORITIES AS CAUSE OF LABOR DISLOCATION 

Now, WO are faced with an entirely different sort of problem, a 
problem of migration away from the industrial centers of Michigan, 
which may result partly from the production quotas in the automo- 
bile industry and partly from the curtiilment of other civilian pro- 
duction, which will result from shortages of critical materials. 

That second factor is extremely hard for us to estimate. Employers, 
some of them, seem to be overoptimistic because material shortages 
have not hit them yet. They feel hopeful that they will be able to 
continue because they have not yet suft'ered through material shortage. 
Others, perhaps, are too pessimistic, and say that at the rate things 
are going, their civilian production will have to be cut very sharply 
and very soon. But there is a certainty that as priorities begin to 
take up more and more of such critical materials as steel and rig iron 
and gray iron and zinc and magnesium and aluminum, the civilian pro- 
duction which depends on that type of supplies is bound to be cur- 
tailed, and many industries other than automobiles are going to be 
badly hurt in Michigan, and of course in a great many other States too. 

However, since Michigan is a mass-production State, a State de- 
pending on fabrication of metal products of some kind to a consider- 
able extent, these priorities in the automobile industry and elsewhere 
probably constitute as great a tlu'eat to this State as they do to any 
other State in terms of dislocation of labor. 

UNEMPLOYMENT ESTIMATES 

As far as the over-all unemployment picture is concerned, the 
figures presented by Governor Van Wagoner this morning come as 
close as we can get to the probable situation in January — for the State 
as a whole, probably 90,000 to 100,000 unemployed workers; for the 
Detroit area, about 50,000 or 55,000. However, those estimates are 
based on the assumption that there won't be a substantial reduction 
of the work week — a thing which, of course, would have the result of 
spreading the employment and at the same time spreading the unem- 
ployment, but making it possible to keep a larger number of workers 
on the job here. 

60396 — 41— pt. 18 10 



7200 DETROIT HEARINGS 

That is a general summary of what is contained in the statement. 

Mr. Curtis. Do you happen to know how the volume of defense 
contracts in Michigan compares in dollars to the volume of potential 
business that has not been transacted because of enforced shut-do\vns 
through priorities and otherwise? 

Mr. Stanchfield. Let me see if I am clear on your question. You 
mean the anticipated defense employment that will come in the future, 
as compared with the anticipated shut-downs in the future? 

COMPARISON OF ESTIMATED DEFENSE HIRES AND SEPARATIONS 

Mr. Curtis. Yes. 

Mr. Stanchfield. In a study which we made in July of this year 
we found that a 50 percent curtailment of the automobile industry 
would eliminate about 175,000 nondefense jobs by January of 1942 — 
that is, assuming that the prevailing workweek is not changed. 

During that same period there would be an increase of a little over 
80,000 in defense jobs, part of them in the automobile industry and 
part in other industries, leaving a net unemployment for the companies 
that we covered in the survey of about 95,000 in January of 1942. 

Mr. Curtis. That was based upon estimates made when? 

Mr. Stanchfield. That estimate was made in July, but it is still 
the best over-all picture for the State that we have available today. 

The studies we have made since then have been largely studies of 
particular communities wheie we are trying to find out on an area 
basis just what is going to happen. In July the total employment in 
defense jobs was 196,000. That includes both employment on direct 
defense contracts and employment of concerns which had priorities 
resulting from the fact that they were producing machinery or supplies 
or various other material for prime contractors. 

Mr. Curtis. Then if you employ 86,000 more, that will be a total 
of nearly 286,000? 

Mr. Stanchfield. That is right. 

Mr. Curtis. And you estimate that nondefense production has 
been cut down to create an unemployment of 175,000? 

Mr. Stanchfield. Yes; but that is a cut which will have occurred 
after July, sir. In July, in addition to these people working on defense, 
we had about 410,000 workers engaged either in producing automobile 
bodies and parts or in producing supplies and equipment needed by 
automobile companies, and those people were working at the same 
time that these 196,000 were working, so what we are going to have 
from July to January is the elimination of about 175,000 of the 
nondefense jobs which did exist in July. 

Mr. Curtis. Well, now I will ask you how many nondefense jobs 
had disappeared by July 1. 

Mr. Stanchfield. It was very close to our peak of automotive 
employment. That wasn't true of two or three of the small concerns, 
but the base figure that we used included the workers who had been 
laid off in the immediate past just for seasonal model change-over. 

Mr. Curtis. And how many was that? 

Mr. Stanchfield. At that time it was very small — probably not 
more than 10,000 or 15,000 for the State. 



NATIONAL DEFENSE MIGRATION 7201 

Dr. Lamb. Mr. Stanchfield, perhaps the Congressman would Uke 
to know where the 196,000 came from who were working on defense 
jobs as of the 1st of July. 

NET LOSS OF 90,000 JOBS BY 1942 EXPECTED 

Mr. Stanchfield. As of that date there was very little unemploy- 
ment in the State. Our unemployment compensation rolls just before 
the beginning of July were running only about twenty to thirty thousand 
claimants per week. In other words, up to that time we had had a steady 
increase in the total volume of employment, and although some non- 
defense jobs have gradually been eliminated, they had been translated 
quite smoothly into defense jobs, so there had been very little disloca- 
tion of labor up to that time. By January 1, however, we will have 
a net loss of 90,000 jobs, because we will lose 175,000 jobs in civilian 
production while we are gaining about 85,000 jobs in defense produc- 
tion. That is starting with the situation we had in July, when we 
had practically no unemployment. 

Mr. Curtis. But when you had no unemployment, you had 196,000 
people working in defense? 

Mr. Stanchfield. Yes; and we will have those, plus 85,000 more, 
or even a greater number by January; but at the same time we will 
have dropped off the jobs of 175,000 people who were working in 
nondefense production in the auto industry in July. 

Dr. Lamb. In other words you will have 276,000 working on 
defense jobs in January? 

INDIAN SUMMER OF EMPLOYMENT 

Mr. Stanchfield. That is right. And 175,000 jobs will have been 
eliminated by January. That isn't the situation as of today, because 
most of the plants are operating with nearly as many employees as 
they had in July. There are exceptions to that. There are perhaps 
20,000 automotive workers who were employed, who have been 
ehminated from their nondefense jobs; but for the most part employ- 
ment now is almost up to the July level. That is a very temporary 
situation, as the plants are trying to get into production with the new 
quota, and you wiU see a sharp drop. You might say we are in an 
"Indian summer" of employment. We are having the last little 
burst of nondefense employment as we go to work on the 1942 models, 
and then very rapidly at the end of October and in November you will 
find that the number of jobs on automotive production will be cut 
down. Then, when the further quota cut comes in December and 
January, you will have further reductions, bringing you to the final 
end result that we have 175,000 fewer workers in automobile factories 
on automotive work than we had before the model change-over this 
year. 

Mr. Curtis. Is part of the automobile industry located outside of 
Michigan? 

Mr. Stanchfield. Yes. 

Mr. Curtis. The wholesalers and distributors and retailers of auto- 
mobiles and automobile parts? 



7202 DETKOIT HEARINGS 

Mr. Stanchfield. Yes, sir. 

Mr. Curtis. They will have no part in this defense program when 
they shut down the auto production, will they? 

Mr. Stanchfield. There are some exceptions to that. As a matter 
of fact one of our large corporations, General Motors, to date has 
probably distributed more of its defense contracts to its plants outside 
Michigan — • — ■ 

PROBLEMS OF DISTRIBUTORS 

Mr. Curtis. No; I am not talking about the plants. I am talking 
about the wholesalers and retailers. 

Mr. Stanchfield. They face a very definite problem, because they 
will not have as many automobiles to sell, and as a result there are 
bound to be reductions in personnel and loss of income to the pro- 
prietors of such businesses. 

Mr. Curtis. How many people are engaged in selling automobiles, 
as compared to the number of people normally engaged in making 
them? 

Mr. Stanchfield. I don't have the figures for the country as a 
whole. In the State of Michigan, as I remember it, we have about 
36,000 wage earners, and I believe 17,000 or 18,000 proprietors engaged 
either in selling automobiles or servicing them. Therefore, we have 
about 50,000 people dependent directly or indirectly on the retail and 
service end of the automobile industry, and in that realm of employ- 
ment you are bound to have a curtailment. It may be less than 50 
percent. 

Mr. Curtis. How does that percentage compare with your total 
employment in auto manufacturing? 

Mr. Stanchfield. A comparison just for this State wouldn't be 
very representative of the national picture. 

Mr. Curtis. I realize that. 

Mr. Stanchfield. Our total employment in production directly 
or indirectly related to automobiles is about 410,000 in Michigan, 
while the employment here in retailing and servicing automobiles is 
about 50,000, counting the proprietors. We have, you see, two-thirds 
of the total amount of productive employment and probably only 
about 6 or 7 percent of the retailing and service establishments of 
the country. 

Mr. Curtis. In all probability the curtailment will run several 
times more in the number of people engaged in selling and servicing 
automobiles than in those making them, isn't that true? 

Mr. Stanchfield. I have seen figures indicating that in one way 
or another one-seventh of the wage earners of this country are directly 
or indirectly employed because of the automobile industry. That 
includes, of course, petroleum refining, transportation of automobiles, 
all the productive activities, selling gasoline, garage mechanics, and 
every other classification that goes into the picture; so that it is true 
probably that you will find the greatest number of workers, who in 
some way depend upon automobiles for their livelihood, outside of the 
factories. However, I don't have exact figures. 

Mr. Curtis. It is going to be impossible for those individuals to 
shift to defense employment, isn't it, at least in their home localities? 

Mr. Stanchfield. Some of them, of course, will be taken care of 
by the fact that garage and repair services won't be curtailed as much 



NATIONAL DEFENSE MIGRATION 7203 

as production of automobiles. As a matter of fact, as we get more 
and more second-hand cars on the road, we may need more of certain 
services; but the retaihug end of the business is very definitely going 
to be sharply hit. 

PATTERN OF OUT-MOVEMENT 

Mr. Curtis. In your paper you have a statement that the out- 
movement which occurred during the 1938 depression can be expected 
to recur in rather similar form as production quotas and priorities 
create a mass unemployment problem in Michigan. Are you refer- 
ring to the present time or at the close of the defense activities? 

Mr. Stanchfield. I mean in the very immediate future. As we 
find jobs eliminated, one of the dangers of which labor and industry 
are all equally conscious is that a large part of our existing labor supply 
will be tempted or compelled to move to some other area in search of 
work. In other words, if the situation actually develops in such a way 
that 80,000 or 90,000 or 100,000 Michigan factory workers will find 
that they are not needed here for a period of several months, some of 
them will be bound to move to areas in which living costs are lower. 

The pattern of movement during the next 2 months may not be 
exactly what we experienced in 1938 and 1939, during the last depres- 
sion. At that time most of the movement was out to rural Michigan 
or back to areas such as the Appalachian States of Kentucky, Teimes- 
see, and West Virginia, with workers going back to areas in which the 
cost of living was lower. That was because we had a nationally 
depressed economy, and there were very few job opportunities else- 
where. 

The situation that we face in here may be a little different because 
there will be areas in which defense employment is expanding rapidly, 
areas in which there are important defense factories and a relatively 
limited labor supply, perhaps, and toward those areas the displaced 
workers from Michigan may be tempted to go. 

One of the things we are most afraid of, in fact, is that this labor 
supply, which we will eventually need when we get defense production 
rolling on a maximum basis here, will move out, find jobs in some other 
States, and then, when they are needed in Michigan, the skilled and 
specialized and fairly adaptable group of machine workers who have 
been used in Michigan industry won't be here for us to use. That 
might create a very serious shortage of labor unless we take steps to 
prevent it. 

IN-MIGRATION OF POTENTIAL LABOR 

Mr. Curtis. Have you had an in-migration of potential labor this 
year? 

Mr. Stanchfield. During the past year we have made some 
analysis of the movement. There is no way of getting an exact 
measure of the total number of migrants. However, a few figures 
might be of some interest. In the Detroit area we found that out of 
108,000 unemployed workers who filed new applications at employ- 
ment offices, over 26,000 had been last employed somewhere outside 
of the Detroit area; and that the proportion and the number have 
been rising constantly during the past year. 



7204 DETROIT HEARINGS 

In August of 1941 more than one-third of all the new applicants in 
Detroit employment offices were workers who had last been employed 
in some other area. 

The Chairman. What proportion, Mr. vStanchfield , was from out- 
side of the State? 

SOURCES OF RECENT IN-MIGRATION 

Mr. Stanchfield. The bulk of those were from outside the State. 
Out of that total of 26,000, about 7,100 had last been employed in 
some other part of Michigan, and about 5,800 had been employed in 
other Great Lakes States, including the States adjacent to Michigan — 
Ohio, Indiana, Illinois, and Wisconsin — and 13,400 had come from 
States farther removed. The next largest group was the Southern 
States, which furnished about 5,100 migrants. 

Mr. Curtis. Do Michigan employers prefer local labor? 

POLICY TO DISCOURAGE MIGRATORY LABOR 

Mr. Stanchfield. I think a very definite policy has been expressed, 
at least, by the Detroit industry, to try to discourage migration into 
this area. 

Mr. Curtis. How do you discourage it? 

Mr. Stanchfield. One way is by not hiring the people, by telling 
them at the gate that you are hirmg local workers, and that you have 
applications filed already by people qualified for this type of work. 
Further, the employment service and the Office of Production Manage- 
ment have made efforts to discourage any policies which might be 
adopted by employers which w^ould tend to puU workers into the 
industrial centers. 

Mr. Osmers. Mr. Stanchfield, isn't it true that some of these 
people have come in from outside the State and have established an 
address in the Detroit area, and then returned to their regular places 
of domicile? Then when word came to their Detroit address of a 
job opening, they were notified by telegram and were then run into 
the job? 

Mr. Stanchfield. To a certain extent that has been true of part 
of the automobile industry's labor supply as long as people can 
remember. That is, there are always some workers who prefer to go 
to smaller towns or some former home during the lay-off season, 
and they leave a Detroit address, and the landladies send them a 
telegram or letter when they are called back to work. I think the 
extent of the practice has decreased, however. 

Mr. Osmers. Has any evidence ^come to your attention to indicate 
that employers in the Detroit areas prefer out-of-State workers 
because of labor difficulties? 

Mr. Stanchfield. I would be inclined to say the reverse is true. 
I think there has been a definite change in policy over the past decade. 

In the 1930's we found our stranded unemployed workers who had 
been brought in from other States constituted a very defoiite relief 
and welfare problem, which was expensive to the community and to 
the industries that had to support the community by taxes. I think 
that while there might be individual exceptions, the rule that is being 
followed now is to try to use the local labor supply as much as we can. 



NATIONAL DEFENSE MIGRATION 7205 

Mr. Curtis. What percentage of the job openmgs are handled 
through the State employment service? 

Mr. Stanchfield. That is a rather hard question to answer, because 
we have no figures on the exact number of openings that are filled 
from other sources. 

Mr. Curtis. Is it large enough so that they can control the labor 
market and almost set the policy to be followed? 

Mr. Stanchfield. That hasn't been true in the past. In other 
words, for the larger concerns, the bulk of the hiring has been at the 
factory gate or from application files. 

Mr. Curtis. I can understand that. 

INCREASING USE OF EMPLOYMENT SERVICE 

Mr. Stanchfield. There has been a tendency in the past few 
months, as the labor markets grew tighter, for the employment 
service to receive a larger proportion of the orders for workers, and 
to fill a larger part of those openings, but it still remains true that 
at least a majority of all of the jobs that are filled are filled directly 
by contact between the worker and the employer. 

Mr. Curtis. Will that be true in a plant especially constructed for 
some defense effort? 

Mr. Stanchfield. There has been some discussion in the recent 
negotiations between O. P. M. and the unions and the automobile 
industry, of the possibility of concentrating all new hiring of defense 
workers in the employment service. That hasn't definitely been 
agreed upon, but if that were done, it would guarantee that local 
workers who are unemployed and available would get the first call 
for defense jobs, so there is a possibility of a development which would 
at least establish a centralized control on the expanding defense work. 

Mr. Curtis. This committee is very much interested in the question 
of subcontracting as a means of spreading defense production. The 
Michigan automobile industry, of course, is noted for the high degree 
to which it has developed subcontracting as an aid to production. 
Can you tell the committee what proportion of workers in the auto 
industry are employed by manufacturers who supply final producers? 

Mr. Stanchfield. I think I could prepare some figures on that. 

Mr. Curtis. Would you do that and either give them to our staff 
or mail them to us in Washington? ' 

Mr. Stanchfield. I might comment at this point on that. In 
Michigan, we probably have a somewhat larger proportion of final 
producers than you would find for the industry as a whole, because 
we have here some of the largest final assembly plants, and some of 
those large companies draw in, through subcontracts, material which 
has been produced in States such as Indiana and Ohio, which go to 
build up the final assembly 

PROPORTION OF SUBCONTRACTS LET 

Mr. Curtis. Can you give the committee any idea as to how 
many of the defense contracts let to employers in Michigan have been 
subcontracts and how many have been prime contracts? 

1 See Exhibit A, p. 7197. 



7206 DETKOIT HEARINGS 

Mr. Stanchfield. The figures that we have, based on a recent quick 
study made by the defense council, woukl indicate that while there 
have been a little over $1,500,000,000 in prime contracts, the number 
of subcontracts would bring the total value of defense work for the 
State up to about $4,000,000,000. That would mean that subcon- 
tracts and other indirect defense work are larger than the prime con- 
tracts themselves. 

Mr. Curtis. It is a little hard to trace all that indirect business, 
isn't it? 

Mr. Stanchfield. It would be extremely hard to get it all straight, 
because in some cases the subcontractor himself or even the purchaser 
doesn't know exactly what production is going into defense and what 
is going into nondefense work. 

A company producmg truck transmissions doesn't usually know 
whether or not this work is on a defense contract, ultimately. That is 
also true of the metal industries. 

Mr. Curtis. Has youi employment placement service observed 
any change in the employability of such portions of the labor reserve 
as Negro workers? 

EMPLOYERS RELAX COLOR AND AGE REQUIREMENTS 

Mr. Stanchfield. There has been a general tendency during the 
past year, as labor shortages began to be felt in certain occupations, 
for employers to relax their requirements in terms of age, color, extent 
of previous service, and so on. I would say that applies more to the 
age requirement than to the color requirement. There is still a ten- 
dency in a good many plants not to extend work opportunities as 
widely to the colored worker as to the white. That results in part 
from the fact the Negro worker, through past hiring restrictions of 
employers, usually has had less opportunity to acquire experience and 
qualifications for factory work than the white worker who might be 
an alternative for selection. 

Mr. Curtis. Has the employment training service been extended to 
Negroes? 

Mr. Stanchfield. Yes; the same program has been extended to 
them, and we find that the proportion of Negroes who are trained 
is just about equal to the proportion of unemployed Negroes in the 
Detroit labor market. 

EMPLOYMENT OF NEGROES 

Mr. Curtis. But their actual employment as skilled workers has 
not increased very much? 

Mr. Stanchfield. The hiring of these Negro trainees has been 
slower than the hiring of white trainees for the same sort of work. 
However, there have laeen some notable exceptions, companies that 
have made a very real effort to divide the jobs between white and 
colored workers. 

Mr. Curtis. Do you have any recommendations as to how the 
Michigan Unemployment Compensation Act can be amended so as 
to assist workers about to be displaced, to tide them over until the 
pick-up in defense employment? 



NATIONAL DEFENSE MIGRATION 7207 

Mr. Stanchfield. Wliat we really need to do is make jobs here 
and accelerate the tempo of defense production by every possible 
means, so that the length of time for which these stopgap measures 
may be needed will be reduced. However, miemployment compensa- 
tion at present probably does provide too low a weekly benefit rate 
and too short a duration of benefits to cover the needs of the workers 
who are going to be. displaced. 

While it would be possible to amend the unemployment compensa- 
tion law to increase the adequacy of those payments, I am inclmed 
to think that what we need to do is to make more jobs in our factories. 
In other words, get more prime contracts into the State and get those 
spread out more widely among the subcontractors; make a very ex- 
tensive and thorough study of individual communities in which ma- 
terial shortages, priorities or quotas are causmg critical situations, 
and then see that some sort of work that is needed in connection with 
our national policy of defense is brought in to utilize at least the bulk 
of the labor supply we have. In recent weeks the Contract Distribu- 
tion Service of O. P. M. has been very definitely expanding both its 
staff and its machinery dealing with what they call "priorities un- 
employment." Now, by "priorities unemployment" they mean un- 
employment which is resulting from production quotas or from the 
inability of civilian producers to get supplies and equipment. 

PRIORITIES UNEMPLOYMENT SURVEYS 

They have already asked the employment service to make studies 
of about 16 diflerent cities in Michigan, and a couple more requests 
come through every week. In those studies we attempt to find out 
as carefully and as completely as we can exactly which employers in 
the community are going to have their nondefense work cut oft' or 
reduced for any of the reasons that I have mentioned; what types of 
workers are going to be displaced there, and the extent to which they 
might be absorbed by existing defense contracts. Then, if they find 
that the defense contracts that are now in sight are insufficient — and 
that is true in several important cities — the next step is to attempt 
to find defense contracts which can be moved into that area fast 
enough and in the proper form to create employment for the displaced 
workers. 

In some cases it is easy to do that with only minor retooling or 
merely by a reallocation of production. In other cases, you find that 
substantial retoolmg may be required. In such cases there may be 
further pressure for getting more defense contracts in. 

RELAXATION OF RULES ON DEFENSE CONTRACT ALLOCATION 

Incidentally, the rules on allocation of defense contracts have been 
relaxed somewhat so that in areas which have been especially certi- 
fied as "priorities unemployment centers," it is possible to assign a 
contract even though the price bid by the employer is as much as 15 
percent above the price that might have to be paid to some other 
producer. 



7208 DETROIT HEARINGS 

The rules have been relaxed so that groups of employers in a par- 
ticular industry or in a particular community may bid collectively for 
a defense contract and then divide the job up among themselves in 
order to get it done. 

DISLOCATION OF SALESMEN AND DISTRIBUTORS 

^ Mr. Curtis. When the automobile industry returns to its peace- 
time task of producing automobiles, you will again need this vast 
army of salesmen and the distributors extending throughout the length 
and breadth of the land, in every city and village and cross-roads agency ; 
will you not? 

Mr. Stanchfield. That is right. 

Mr. Curtis. And it is through their work in the past that you 
were able to make and sell so many automobiles. Now, what have 
you got to suggest for that individual, to cushion him against the 
curtailment of automobiles? 

Mr. Stanchfield. That problem is a lot broader than the auto- 
mobile industry alone. Remember, you have refrigerator salesmen, 
washing-machine salesmen 

Mr. Curtis. They are all out. In the rural areas, out in the 
country, the garageman sells all of those things. He sells Chevrolet 
cars and refrigerators and radios and washing machines, but from now 
on those things that he sells will not be available. 

Mr. Stanchfield. I think the answer has to be the same that it is 
for the workers who are displaced from other types of civilian pro- 
duction. In other words, we have got to make enough jobs in the 
right places so that we don't have any black-outs in communities 
where there is no work at all; and when we get our productive system 
rolling as rapidly as we can on the defense program that we are con- 
templating now, we must make enough jobs so we can use the salesmen 
as well as the factory workers. 

Mr. Curtis. It is not possible for the smaller communities to get 
defense activities. 

Mr. Stanchfield. Usually it is not. You are thinking of the cross- 
roads town or the small village? 

Mr. Curtis. Yes. 

Mr. Stanchfield. The unemployed workers from those areas, to 
the extent they are pushed out of the picture by priorities on the 
things that they sell, will probably be one of your migrant problems. 
That is, they will have to be absorbed somewhere else. 

The Chairman. Mr. Stanchfield, I was very much interested in 
your statement that Michigan desires to employ local people. As 
you made that statement, I was thinking of the 48 States of this 
Union that are making it possible for the Federal Government to 
spend huge sums for the national defense. All of the 48 States are 
doing that, isn't that true? 

Mr. Stanchfield. Yes. 

The Chairman. Now, there are States of this Union that haven't 
a single defense industry, are there not? 

Mr. Stanchfield. I did not know that was so. 

The Chairman. There are several that haven't a smgle one. Now, 
if Michigan constructs a wall around herself and says, "We will only 
hire local people," and there comes a time when you haven't the 



natio:nal defense migration 7209 

iiecessary help here and you have to ask the other States to help you 
out, where are you going to be then? 

NO WALL AGAINST IMPORTATION OF LABOR 

Mr. Stanchfield. I wouldn't want my remarks to be construed to 
mean that there is an absolute wall against movmg of workers into 
this area if they are needed. The policy I was trying to describe is 
one of using the local workers as much as they can be used — that is, 
takmg up the slack of local unemployment before you call in workers 
from other areas. 

The policy is, first, to use the men you have here even if it is neces- 
sary to relax specifications on age, color and so on; but eventually, as 
far as we are able to see mto the future, there will be a time when we can 
use all the workers that we now have in the Detroit area in some kind 
of defense work. We will use at least that many workers. 

control by employment service 

There is this question in all of these estimates of unemployment we 
have been talking about: How many nondefense jobs will be elimi- 
nated and how many new jobs will be created in defense production? 
Although the difference between those is the net number of unem- 
ployed, actually some of the people who will be dropped out of the 
nondefense jobs cannot be moved into these defense jobs because they 
don't have the right occupational background. They lack the per- 
sonal attributes or aptitudes that are needed for the new jobs. So 
there is a certain amount of milling around in the labor market. 
Some of the new jobs are bound to go to people other than those who 
have been jjushed out of the old nondefense jobs, and in certain 
skilled occupations even now there may be cases where it is necessary 
to bring workers from some other community to Michigan centers. 
However, when that is done, it is the policy of the State employ- 
ment service and the United States Employment Service to see that 
the movement should be controlled, working through the public 
employment service system as much as possible, so that instead of 
having the workers just move around hunting for work, the jobs are 
found for them in a selected area. Then, after every resource of that 
area has been exliausted, workers are brought in through the employ- 
ment services of nearby communities, or eventually of other States, 
which will be notified that these openings exist. The proper workers 
will be located and then brought into the centers where they will be 
needed, with a definite promise of a job and no waste motion. 

The Chairman. The Great Plains States — Nebraska, the Dakotas, 
Kansas — have lost over one million people in the last 10 years. Con- 
gressman Curtis, of Nebraska, has lost approximately half the people 
in his congressional district after 8 years of drought. Up until a 
few months ago Nebraska did not have a dime of defense contracts. 
I think finally they got one project at Omaha. There are some 
Southern States that haven't received any. So we must go a little 
carefully about this proposition of drawing walls about us, because 
if we are going to win out in this emergency, it will take the 48 States — 
all of them together, not three-quarters of them, not one-half of them, 
but all of them. That is what I am trying to get at. 



7210 DETROIT HEARINGS 

Mr. OsMERs. Were you here this morning, Mr. Stanchfield? 

Mr. Stanchfield. I heard most of the testimony. 

Mr. OsMERs. I have been questioning some of the witnesses here 
and in other places with respect to price-fixing. Any form of price- 
fixing will have a very fundamental effect on the matter that we are 
discussing, and even on the movement of people. Do you believe 
that such price-fixing should include the fixing of wages and prices of 
agricultural commoclities? In other words, should we fix our entire 
economy at one time? 

PRICE FIXING 

Mr. Stanchfield. That happens to be a little out of my line, since 
I am primarily interested in the labor supply and labor demand. 
I think you do have to recognize the fact that all prices are related 
to each other. On the other hand, when you try to fix prices — all 
types of prices, including wages — you run into the problem of just at 
what point in time j^ou will fix the wages, and how you are going to 
reconcile the fact that some industries have already had their wages 
increased with rising costs of living while others haven't. 

I don't, frankly, know the answ^er. I imagine Mr. Henderson can 
tell you something about that. 

Mr. OsMERS. We hope he knows the answer. 

Now, another question: Is there any evidence of race discrimination? 
I listened carefully to your discussion of the Negro, with respect to 
some of these industries. Is there any other form of race discrimina- 
tion in this area? 

Mr. Stanchfield. I don't quite get the question. You mean Jim 
Crowism or things of that kind? 

Mr. OsMERs. Discrimination not only as to color, but as to race. 
Do you have any discrimination against certain races within your 
population, in the filling of jobs? 

LITTLE race DISCRIMINATION IN MICHIGAN 

Mr. Stanchfield. I would say there is probably very little of that 
in Michigan, for the reason that a very large part of our population is 
foreign born. I know in some other areas of the country there is a 
tendency to discriminate against the Italian name or the German 
name or the Polish name, or whatever the employer doesn't like. 

In Michigan, if you look over the pay rolls of our plants, I think- 
the answer to that question will be self-evident, that national origin 
certainly cannot be a major factor, because you will find almost every 
nation of the world represented in our big plants. 

Mr. OsMERS. I am glad to hear that. 

There is just one other question I have in mind, and that is with 
respect to this unemployment compensation law. I heard you reply 
to Mr. Curtis that you thought the solution was more jobs. Well, 
that program will probably fall short throughout the United States. 

In Michigan you might approximate the change-over because you 
have so many defense industries, but in the States that are not adap- 
table for defense industries, they are just going to get the bad parts, 
Michigan will probably end up among the first three or foin- States in 
the Union. 



NATIONAL DEFENSE MIGRATION 7211 

Now, jumping ahead to the post-war period. What changes do 
you think should be made in our unemployment compensation laws, 
briefly, that would cushion the post-depression period of a year or 
two that will come when all this is over? 

Mr. Stanchfield. I have some rather definite opinions on that. 

STANDARDIZATION OF UNEMPLOYMENT BENEFITS RECOMMENDED 

In the first place, I think one of the weaknesses of the present unem- 
ployment compensation system is the fact that the standards of bene- 
fits — the amount paid, the duration for which benefits are paid, the 
requirements that must be met in order to qualify for benefits — tend 
to be more and more widely divergent among the States. Some 
States pay very low benefits. Others pay twice as high as the lower 
States. Some pay what amounts to considerably more than half of 
the full-time wage. Others pay considerably less under special 
formulas. 

Under the present system, there seems to be more and more scatter- 
ing among the States. The result is that, depending on local pres- 
sure, the unemployed worker in what you might call a progressive or 
liberal State has adequate protection against unemployment, if he is 
an insured worker. In other States, including a good many m the 
South, the system is very ineffective in providing protection. 

FINANCIAL DIFFICULTIES 

Now, another diflSculty is the financial problem. A State like 
Michigan might be anxious to liberalize the benefit structure in terms 
of longer duration of benefits, or a higher maximum rate, or some 
other change that essentially is desirable, but with our present rate 
structure we can't afford it. Some other States that are less sus- 
ceptible to unemployment might be able to go considerably farther 
and still remain solvent. 

SUGGESTED CHANGES IN LAW 

So — expressmg now my personal opinion rather than the opinion 
of the commission^ — I feel that it is definitely necessary to consider 
two types of improvement. One is the establishment of uniform 
national standards governing the benefit structure and the eligibility 
structure and requirements of unemployment compensation; and, 
second, to rearrange the financing of imemployment compensation 
so that through what you might call a reinsurance plan, or some 
equivalent, the pay-roll taxes collected throughout the country can 
be made available to meet the Nation-wide needs rather than being 
allocated in little compartments to a particular State. 

On that basis probably our present tax rate of 3 percent is plenty 
to give us a much more adequate benefit structure than we have now. 

Mr. OsMERs. Do you have a huge surplus in Michigan? 

INADEQUACY OF SOCIAL SECURITY RESERVES 

Mr. Stanchfield. Definitely not. The fund has been rising. It 
is up now to just under $110,000,000, but our experience during the 



7212 DETROIT HEARINGS 

depression of 1938 and 1939 showed us that we probably will bear the 
brunt of any depression more severely than any other large State in 
the Union. We are highly specialized. "We are dependent on mass 
production industries. We are dependent on Nation-wide marketing, 
and we beUeve that when a post-war or post-defense depression 
comes, the Michigan funds that we are now building up may be in- 
sufficient to carry all the load. They might carry the load with our 
present benefit structure, but they certainly impose serious limits on 
the extent to which we can increase our benefits on the basis of our 
own collections. 

Mr. OsMERS. In my own State of New Jersey, we built up huge 
reserves and we reduced our taxes. That is my recollection of it. 
You feel, as a general thing, that there are measures that the Federal 
Government can enact that will strengthen and improve and equalize 
the whole set-up? 

Mr. vStanchfield. Yes, sir; I do. 

Mr. OsMERS. You don't feel we have anywhere near reached 
perfection? 

EQUALIZATION OF BENEFITS SUGGESTED 

Mr. Stanchfield. No, sir; as a matter of fact, when the Social 
Security Act was originally adopted it was with the understanding 
that there would be experimentation on a State-to-State basis, as 
even then there was a great deal of discussion of the possibility that 
there should be, if not a Federal system, at least Federal standards 
which would provide some uniformity between States; and I personally 
feel that the time has come when we should have some of that uni- 
formity. 

Mr. Osmers. One of the objections that is constantly raised to 
equalizing those benefits, not only with respect to unemployment 
compensation but to all these measures that require a State set-up, 
is that the more prosperous States feel that their funds are being used 
to benefit the people in other States. 

Now, it may not be a sound national viewpoint, but it certainly is 
a very practical consideration when you attempt to pass some of this 
legislation. That has been true of old-age assistance and unemploy- 
ment compensation all the way through. What you face there is the 
fact that a good deal of the unemployment problem that we have to 
deal with has national causes, though it has local effects. Do you 
agree? 

Mr. Stanchfield. That is right. In Michigan, as a matter of 
fact, we wouldn't suffer by some pooling of national resources. We 
would tend to be drawing money from some other State that had a 
surplus, and that would help us solve the problem which exists here, 
because we get 70 percent of the automotive unemployment of the 
country although we don't collect enough unemployment compensa- 
tion contributions to pay adequate benefits to these workers. 

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

Mr. Osmers. Mr. Chairman, Mr. Stanchfield would like to add a 
few words to his testimony. 

NATIONAL APPROACH TO UNEMPLOYMENT COMPENSATION PROBLEM 

Mr. Stanchfield. I have just one more comment on this question 
of a national approach to the unemployment compensation problem, 



NATIONAL DEFENSE MIGRATION 7213 

and that is that regardless of what the ncrmal situation is when we are 
not in a defense program, we do know that the unemployment we 
are going to face after this defense program will be somethmg resulting 
from Nation-wide dislocations and a Nation-wide policy of building 
plants where we need them, building plants that we know eventually 
are going to fold up completely. 

The location of that unemployment, and the impact of that unem- 
ployment, may have no direct relationship to the normal resources 
of the particular State where it occurs by the time it happens, and 
therefore, regardless of what might be desirable in a noimal unem- 
ployment compensation system, we certainly need to give some 
attention to a national policy that will provide greater protection to 
unemployed workers immediately after the eventual decline of defense 
industries. 

The Chairman. I want to say to you, Mr. Stanchfield, that is a 
very good backing for Congressman Osmers' contemplated bill, and 
I am inclined to back him up too. 

Colonel Furlong will be our next witness. Colonel, will you come 
forward? 

TESTIMONY OF IT. COL. HAROLD A. FURLONG, ADMINISTRATOR, 
MICHIGAN COUNCIL OF DEFENSE, LANSING, MICH. 

The Chairman. Colonel Furlong, Congressman Arnold will interro- 
gate you. 

Mr. Arnold. Will you state your name and address and the position 
you hold? 

Colonel Furlong. Harold A. Furlong, Lansing, Mich., adminis- 
trator of the Michigan Council of Defense. 

Mr. Arnold. Colonel, you have submitted a statement here that 
is very valuable for our record and it will be inserted in the hearings 
in full. 

(The statement referred to above is as follows:) 

STATEMENT BY LT. COL. HAROLD A. FURLONG, ADMINISTRA- 
TOR, MICHIGAN COUNCIL OF DEFENSE, LANSING, MICH.' 

The defense production program is serving to revive and locally accentuate 
migrator}^ trends in Michigan which were strikingly in operation between 1910 
and 1930, but which were checked and even reversed during the depression years 
of the thirties. The basic pattern of this migration has taken the form of large 
scale influx of population into the cities of southeastern Michigan, attracted by the 
phenomenal development of the automotive and auxiliary industries, and of a 
marked efflux from most of the rural counties of the State. 

Between 1910 and 1930 the population of Detroit, as the mass-production 
capitol of the Nation, swelled from less than half a million to well over a million 
and a half. During the same two decades the combined population of focal 
Wayne County and of the contiguous counties of Macomb, Oakland, Washtenaw, 
and Monroe more than tripled, while that of the outer fringer of motor cities, 
Lansing, Flint, and Saginaw, increased by 163 percent. The influx into this region 
represented a compound of intrastate, interstate, and international migration. 

Contemporaneously with this spectacular inflow into Michigan's industrial 
centers, there occurred a net loss of population in the majority of the counties 
of the State. The census of 1930 revealed that in 57 counties, or more than two- 
thirds of Michigan's 83 counties, there were fewer persons living than at some 
former census period. The are as in which this net efflux occurred included not 
only most of the cutover counties lying north of the Bay City-Muskegon line 
(reflecting the decline in farming, lumbering, and mining), but also the majority 

' Prepared with the assistance of Prof. Harald S. Patton, Michigan State College, East Lansing, Mich. 



7214 DETROIT HEARINGS 

of the older settled and fertile agricultural counties of southern Michigan and the 
fruit-growing counties along the Lake Michigan shore. Here the shrinkage in 
population reflected the double influence of the pull toward factory and urban 
employment with its economic and social attraction, and of mechanization in 
commercial farming. Between 1920 and 1930 the farm population of the State 
declined from 848,710 to 782,394. 

MIGRATION IN DEPRESSION YEARS 

These pronounced migratory trends prior to 1930 were checked and even 
reversed during tlie depression years of the thirties, which tell with special severity 
on the automotive and machine industries. Many unemployed persons drifted 
back from industrial centers to rural areas, while the natural increase of the latter 
tended to be largely retained. Between 1930 and 1940 the population of Detroit 
showed an increase of only 3.5 percent, compared to 58 percent in the preceding 
decade; and that of Pontiac an increase of but 2.6 percent, compared to 89 percent 
between 1920 and 1930. Lansing barely held its own, while declines of varying 
degree were shown by Hamtramck, Highland Park, Monroe, Flint, Grand Rapids, 
Battle Creek, Kalamazoo, and Jackson. On the other hand, the 1940 census 
showed more persons living than in 1930 in every county of the State, except four 
mining counties in the Upper Peninsula. In 1940 there were 18,190 more farms 
reported in the State than in 1930, and the number of persons living on farms 
increased by over 90,000. This movement represented, however, a retreat to 
the land and a recourse to subsistence or part-time farming and gardening, rather 
than an expansion in commercial farming, and many of those reported as living 
on farms were not actively engaged in agriculture. Thirty-five percent of the 
increase in the number of farms was among those 3-9 acres in size and nearly 
90 percent was accounted for by those under 50 acres.i it is significant that this 
increase in the number of census farms occurred not only through nearly all the 
counties of the Upper Peninsula and the cut-over region of the Lower Peninsula, 
but even more markedly in highly industrialized counties. Thus Wayne County 
showed 74 percent more "farms" than in 1930; Oakland an increase of 67 percent; 
Macomb, 35 percent; Genesee (Flint), 82 percent; and Kent (Grand Rapids), 
27 percent. On the other hand, there were fewer farms reported in 1940 than in 
1930 in such important commercial agricultural counties as Lenawee, Eaton, 
Allegan, Berrien, and St. Joseph. 

The decline during the thirties in the population of many Michigan cities and 
the slackened rate of growth in others, served to relieve the pressure for providing 
additional public utility, sanitary, housing, and school facilities which had been 
demanded bv the spectacular influx into these industrial communities during the 
preceding two decades. On the other hand, the outward migration to lower rent 
areas and part-time farming locations imposed greatly increased demands for 
such public facilities and services upon peripheral townships and villages, whose 
existing bonded indebtedness and low assessed valuation, in combination with the 
constitutional 15-mill tax limitation, generally made adequate provision finan- 
cially impossible, 

CONTRIBUTIONS OF WORK PROJECTS ADMINISTRATION AND PUBLIC WORKS 

ADMINISTRATION 

Considerable relief in meeting these problems has been afforded, however, in 
many localities through the Federal Work Projects Administration and Public 
Works Administration programs which have also contributed appreciably to 
qualitative improvements in public buildings, facilities, and services in larger 
cities. At the same time extensive highway improvements and the development 
of suburban and interurban bus lines with frequent schedules have contributed to 
making rural residence and urban employment and the supplementing of cash 
income with direct real income, a combination of increasing and widening prac- 
ticability. Along with this the experimentations of the Farm Security Adminis- 
tration and the guided activities of county agricultural conservation committees 
and land-use planning committees have been working toward adjustment and 
stabilization amcng farm communities, and particularly toward long-term rehabili- 
tation in the counties of the cut-over region and the Upper Peninsula. 

1 For the purpose of the 1040 census a "farm" was defined as "all the land on which some agricultural 
operations are performed by one person, either by his own labor alone, or with the assistance of members 
of his household or hired employees. " Census enumerators were instructed not to report as a farm any 
tract of land of less than 3 acres, unless its agricultural products in 1939 were valued at $250 or more. 



NATIONAL, DEFENSE MIGRATION 7215 

By 1940, when business activity regained the 1929 level, there were signs that 
a certain equilibrium was being attained in Michigan between the urbanward 
migration of the twenties and the landward retreat of the earlj^ thirties. A new 
and more balanced demographic pattern appeared to be taking shape, character- 
ized by a less disparate geographic distribution of population, by a higher propor- 
tion of rural residents, by a closer approximation between community facilities 
and community populations, and by a dwindling of intrastate migration, as com- 
pared to the twenties. The cyclical increase in industrial employment, following 
the recession of 1937-38 was met for the most part by the recall of local and 
commuter-range unemployed, rather than by the hiring of workers from outside 
areas. 

Ahea Impact of Defense Production in Michigan 

This new urban-rural pattern which was evolving in Michigan during the late 
thirties is now being disturbed by the impact of the defense-production program. 
Superimposed as it has been upon a cyclical upsurge in commercial production in 
which the automobile industry has set the pace, and concentrated as it is in 
Michigan upon the automotive centers, it has generated an emergency demand 
for mechanical labor which the competition of employers and the activities of 
recently recognized unions have promptly translated into uplifted wage rates. 
This situation has already resulted in reviving and locallj^ accentuating both 
intrastate and interstate migration into the same areas when it was most pro- 
nounced between 1910 and 1930 and largely in abeyance during the thirties. 

A greater volume of defense contracts has been awarded in Michigan than in 
any other inland State. During the 12 months ending May 31, 1941, the value 
of major defense prime contracts awarded by the Army and Navy Departments 
to Michigan contractors amounted to $724,000,000, the only States receiving 
larger awards being New Jersey, New York, and California where the category 
of "ship construction and equipment" accounted for a third of their combined 
total. 1 Defense orders placed in Michigan have been principally for Army trucks, 
tractors, trailers, and maneuvre vehicles, airplane engines and fuselages, medium 
tanks, antiaircraft and machine guns, shell casings, machine tools and precision 
instruments, marine engines, hoists and winches, forging and castings. It is 
n?tural that the V:)ulk of these prime contracts should be placed with the major 
automobile concerns with their specialized and integrated plants, their large 
engineering and research staffs, and their established relations with manufacturers 
of parts and accessories. 

The production of military vehicles involved a minimum departure from 
normal operations. The output of airplane engines and shells was a matter 
of engineering adaptation rather than of new plant construction or basic labor 
shift. When additional plant facilities were required, these could often be 
obtained most speedily and economically by the conversion of idle plants in 
industrial centers. Thus the Chrysler Corporation has taken over the old Graham- 
Paige factory in Detroit for the fabrication of Martin bomber fuselages, while in 
the Lansing area General Pvlotors has converted the long disused Bohn-Ryan brass 
foundry into a forge plant turning out shells, and a large section of the idle Reo 
plant is being tooled for the production of Hamilton propeller blades bj^ Nash- 
Kelvinator Corporation. 

It is to the big automobile companies that the Army and Navy have also turned 
for the design, tooling, and operation of major defense plants where new and 
specialized construction was demanded, as in the case of the Ford bomber plant 
near Ypsilanti, and of the Chrysler tank arsenal and the Hudson nayal arsenal 
near Center Line just inside Macomb County. While the economics of industrial 
location and management have dictated that all of these three huge plants should 
be erected on open land on the outskirts of Detroit, the effect is to accentuate 
the concentration of defense production and labor migration in the southeastern 
corner of the State. 

break-down of prime defense contracts 

A break-down of prime defense contracts awarded for execution in Michigan 
up to July 26, according to the counties in which the contracting manufacturers 
or construction firms were located, reveals that 90 percent of the total value of 
$1,291,000,000 involved, was assignable to the six adjoining and industrially 

' a recapitulation by the Office of Production Management of all defense contracts awarded in Michigan 
up to June 30, 1941, including those for food, fuel, and services, and those let by the Defense Plant Corpor- 
ation and by Defense Housing agencies, showed a total of over $1,000,000,000. 

60396— 41— pt. 18 11 



7216 DETROIT HEARINGS 

integrated counties of Wayne, Oakland, Maconil), Washtenaw, Genesee, and 
Saginaw. The only other counties outside this bloc in which the value of de- 
fense contracts awarded exceeded $5,000,000 were Muskegon ($40.7 million) in 
which Continental Motors Corporation is located, Bav ($19,000,000), Kent 
($11,000,000), Calhoun ($9.7 million), and Jackson ($5."5 million). Contracts 
totaling between $1,000,000 and $3,000,000 for each county were also shown for 
St. Clair, Berrien, Ingham, and Eaton. While the process of subcontracting, the 
placing of orders for materials and accessories by manufacturers, and the inclu- 
sion of Government contracts for foodstuffs, fuels, and services which do not 
appear in these totals, suggests a somewhat more diffused pattern of defense pro- 
duction and employment through the State than the above figures indicate, the 
concentration of defense activity in the area between the Detroit River and 
Saginaw Bay is of staggering proportions. And this is bound to be accentuated 
by the bringing into production of the huge new defense plants now under con- 
struction and the execution of jslant expansions in that region for which certificates 
of necessity have been issued. 

Labor Migration Into Defense Production Areas 

The area allocation of defense contracts serves as an indicator of the localized 
distribution of the emergency demand for mechanical and construction labor. 
The existence of available labor reserves in the localities concerned does not 
preclude the drawing thither of many persons from other areas who are unem- 
ployed or who hope to better their employment by migrating to such centers of 
active demand and high wages. Mere reports of the awarding of large defense 
contracts or of the authorization of construction projects are sufficient to set 
large numbers of job seekers in motion. 

While comprehensive and accurate data on the extent and distribution of recent 
labor migration into Michigan defense areas are not available, the council has 
gathered certain indications from various sources. 

motor vehicle operator licenses 

1. A recent check made by the registration division of the secretary of state's 
department of the number of motor vehicle operator's licenses issued to appli- 
cants who had entered Michigan from other States showed a total of 10,918 for 
the 3 months of June, July, and August of this year. It may be presumed that 
most of these car owners brought one or more other persons with them into the 
State, either as family dependents or additional job seekers. The Michigan ad- 
dresses reported by these licenses indicated that 5,585, or more than one-half of 
the total, had located in Wayne County, and another 1,288 in the adjoining coun- 
ties of Oakland, Washtenaw, and Macomb. Other counties on each of which 
more than 275 licenses were issued to out-of-State applicants included Genesee 
(Flint), Kent (Grand Rapids), Ingham (Lansing), and Calhoun (Battle Creek). 
These 8 industrial counties accounted for four-fifths of all licenses issued 
during the last 3 months to operators entering from other States. 

WORK PROJECTS ADMINISTRATION SURVEY OF MIGRATION 

2. A survey of "recent migration into Detroit and its environs" conducted by 
the Work Projects Administration Division of Research in June 1941 found that 
16,300 workers, accompanied by 17,600 dependents, had moved into the survey 
area (which included Detroit proper and 17 satellite cities, but not open country 
areas) from places outside of Waj'ne, Oakland, and Macomb Counties subsequent 
to October 1, 1940, who were still living in the survey area in June 1941. The 
principal origins of these migrants were found to be the large industrial cities of 
the east and midwest, the "depressed areas" of northern Michigan, and mountain 
communities lying south of the Ohio River, the average distance traveled being 
340 miles. Only 4 percent of these migrants were Negroes. Forty-one percent 
of all the migrant workers came from rural places, and 21 percent had been en- 
gaged in agriculture at their last place of residence. Most of the workers (68 
percent) had moved to the Detroit area for the first time, and of those who had 
formerly lived there about half had been absent for 4 years or more. 

While 17 percent of these migrant workers reported that they had been with- 
out jobs at their last place of residence, only 10 percent were found to be unem- 
ployed in Detroit at the time of the surve3\ Of the latter one-fifth had been 
jobless in the places from which they had migrated, another fifth had been en- 
gaged in farming or mining at the time of leaving, and approximately another 



NATIONAL DEFENSE MIGRATION 



7217 



fifth in domestic and personal service. Most of those who were skilled or semi- 
skilled and had previously been engaged in manufacturing or construction had 
found employment in Detroit, and a considerable proportion of those who had 
previously worked in unskilled or nonmanufacturing occupations had succeeded 
in moving up the occupational scale or making an industrial shift. Thus twice 
as high a percentage of these migrant workers were employed in Detroit in skilled 
or semiskilled occupations as in their last place of residence, and whereas only 
26 percent had been previously engaged in manufacturing or construction, 50 
percent were so employed in Detroit at the survey date. 

It is noteworthy that more than half of these migrant workers were unaccom- 
panied by any dependents, and that the total number of dependents brought in 
was only "slightly more than the number of workers. The total number of migrant 
persons"^ (33,900) was equivalent to only 1.8 percent of the 1940 population of the 
area surveyed. This would imply that the additional demand so represented on 
housing and school facilities in the Detroit area did not in itself present a serious 
problem. The authors of the survey report concluded that "by and large the 
movement into Detroit appears to have proceeded with reasonalale smoothness," 
and that "in general the migrants appear to have made a remarkably realistic 
appraisal of the economic opportunities of the Detroit area." 

This rather reassuring conclusion is subject, however, to several qualifications. 
The survey does not include persons who may have come to the Detroit area in 
search of jobs between October 1, 1940, and June 1941 and departed because of 
failure to find employment. It excludes migrations of persons within the three 
counties of Wayne, Oakland, and Macomb, and of course it does not cover migra- 
tions into the Detroit area since the survey date in early June, which are known to 
have been on an expanding scale, and are almost certain to increase in the near 
future in view of anticipated labor reciuirements on existing defense contracts, and 
of tlie bringing into operation of new defense plants under construction or tooling. 

REGISTRATIONS FOR EMPLOYMENT 

3. An analysis of new applications for employment accepted by Detroit area 
offices of the Michigan Unemployment Compensation Commission, according to 
location of last employment prior to registration, reveals that of 108,038 new regis- 
trations for the 13-month period August 1940 to August 1941, inclusive, 24.4 
percent were of applicants whose last place of employment was outside of Detroit. 
The proportion of these increased from 18.8 percent in August 1940 to 34 percent 
in August of this year. The following tabulation shows the number and the 
regional distribution of these new applicants for the entire period and for the 
initial and last months included. 





Total all 
locations 


Location of last employment prior to registration 


Period 


Detroit 


Applicants with last employment outside 
Detroit 




Total 


In Mich- 
igan 


Great 
Lakes 

States 


All other 
locations 


Total, 13 months _ --. 


108, 038 
3,686 
10, 194 


81, 720 
2,994 
6,731 


26, 318 

692 

3,463 


7,132 

158 

1,175 


5,775 
151 
731 


13,411 


August 1940 - 


383 


August 1941 


1,557 







PERCENTAGE DISTRIBUTION 



Total, 13 months 

August 1940 

August 1941 



100 
100 
100 



75.6 


24.4 


6.6 


5.4 


81.2 


18.8 


4.3 


4.1 


66.0 


34.0 


11.5 


7.2 



12.4 
10.4 
15.3 



It will be seen from the above that the number of new applicants who had last 
worked in Michigan outside Detroit increased from a mere 158 in August 1940 to 
1,175 in August of this year, and that the number of registrants from, n.ore distant 
locations beyond the Great Lakes States more than quadrupled within that inter- 
val. While the number of applicants under the Detroit column was 6,731 last 
month, con.pared to 2,994 in August 1940, it constituted a marked decrease from 



7218 DETROIT HEARINGS 

the 10,813 registered in March, and doubtless represented many who merely 
wished to change their jobs, as well as young persons com.pleting defense training 
courses. 

SURVEY OF MACOMB-OAKLAND AREA 

4. A survey of the Macomb-Oakland industrial defense area, conducted jointly 
m June 1941, by the Michigan Council of Defense, the National Resources Plan- 
ning Com.mission, and the United States Public Health Service (a copy of whose 
report is attached as an exhibit i) reveals that whereas in the three Macomb County 
townships of Warren, Erin, and Lake adjoining the northern boundary of Detroit 
city, there had been only a few hundred industrial employees at the time of the 
1940 census, there were actually 9,293 such employees in June 1941. It is in this 
area that the new Dodge truck factory, the Chrysler tank arsenal, the Hudson 
naval arsenal, and several sn.aller plants employed in defense production have been 
located, and it is estin.ated that the labor loads of these combined plants will 
am.ount to 14,890 by January 1, 1942, and rise to 27,640 by June 1, 1942. The 
1940 census showed a population of 55,329 residing in these three townships. 
The survey report estin.ates that the new industrial employm.ent in this area will 
result in an increase of population of some 70,000, or nearly 110 percent by June 
1942. Southern Macomb County constitutes the most acute and concentrated 
area of actual and prospective defense migration in the entire State, and it presents 
formidable and urgent sanitary, housing, and school problem.s, concerning which 
the report m,akes specific recomm.endations, especially on the imperative necessity 
of the immediate undertaking of a master sewage-disposal system. 

LETTERS TO CHAMBERS OF COMMERCE 

5. Letters sent out in late August by the executive secretary of the Michigan 
Council of Defense to all chambers of commerce in the State, inquiring as to the 
nature and extent of defense migration in their respective communities, brought 
in replies from 17 cities. From these incomplete reports it appeared that cities in 
northern Michigan (Hancock, Iron Mountain, Gladstone, Alpena) were losing 
workers, most unemployed, by migration mainly to the southeastern part of the 
State. Cities on the fringe of the Detroit metrpolitan area (Bay City, Saginaw, 
Flint, Pontaic, and Jackson) were in substantial agreement in reporting that in- 
creased factory employment represented the absorption of resident unemployed, 
and was accompanied by reduction in local relief and Work Projects Administra- 
tion loads, rather than by any appreciable influx of job seekers from outside 
areas. (The manager of the Pontiac Chamber stated that "993'2 percent of our 
employees today are residents of Pontiac, Oakland, or adjacent counties.") The 
Greater Muskegon Chamber, in reporting that local factory employment had 
risen by over 7,000 since April 1940, stated that while some 2,000 of these addi- 
tional employees had been taken from Work Projects Administration rolls, and 
another large element was represented by commuters, an estimated three to four 
thousand had immigrated into the area, particularly from the nothern half of the 
Lower Peninsula. Ann Arbor reported an increasing number of transient workers, 
mostly headed for the Detroit area; and the secretary at adjacent Ypsilanti stated 
that "the influx of unskilled workers from the south continued unabated." 

Some significant figures were submitted to the council by the city manager of 
Plymouth in Wayne County showing the distribution of employees of 5 factories 
in that city according to the distance which they daily traveled to work. In the 
case of the old established Daisy Manufacturing Co., 97 percent of its 325 em- 
ployees lived within less than 5 miles of the factory. On the other hand, in the 
case of the new defense plant of the Kelsey-Hayes Wheel Co., only 13 percent of 
its 750 employees lived within 5 miles, and no less than 60 percent came to work 
daily from living locations beyond the 10-mile range. 

Impact of the Defense Program on the Copper Counties 

While the positive and stimulating impact of the defense program is being 
concentrated in the southeastern corner of Michigan its negative and hampering 
efi"ects are being felt most acutely in the northern extremity of the State, where 
the copper industry has been adversely affected by rising costs in the face of a 
ceiling price for its product. Although copper production in the Upper Peninsula 
increased by 85 percent between 1921 and 1929, the populations of Houghton 
and Keweenaw Counties declined between 1920 and 1930 by 26.5 and 19.7 percent, 

i Held in oommittee fliea. 



NATIONAL DEFENSE MIGRATION 



7219 



Showing Location op Macomb-Oakland Area 




7220 DETROIT HEARINGS 

respectively. This was due mainly to consolidations and technological improve- 
ments in the Michigan copper mining industry without which production could 
not have been sustained in competition with the newer and lower cost open pit 
mines of the Southwest. During the depression years of the thirties, when most 
of the mines had to discontinue operations, the exodus from these counties con- 
tinued and they showed the highest relief loads in the State. Between the 1930 
and 1940 census years the populations of Houghton and Keweenaw further 
declined by 10 and 20 percent, respectively, although during the same decade the 
population' of every other county in the Upper Peninsula, except Iron and 
Dickinson, showed some increase. 

Moderate recovery of copper prices after 1933, and selective concentration 
upon high grade veins, made possible a stepping up of production from the low 
point of" 46,800,000 millions pounds in 1933 to an average of aV^out 90,000,000 
between 1936 and 1940, with 6 of the 19 mines operating in the last year. By the 
time the defense program was launched a measure of stabilization and adjustment 
had been attained in the copper country and consideiable progress was being 
made in the rehabilitation program under the Farm Security Administration in 
cooperation with county and local authorities and the mining companies. 

Although only a few small-scale defense contracts have come to Upper Peninsula 
cities (Escanaba being a limited beneficiary), the defense program is inducing 
somewhat greater activity in the iron-mining and lumbering industries. In the 
case of the copper industry, however, the necessity of raising wages to meet the 
lure of high paid employment opportunities elsewhere, with most mines and work- 
ings definitely submarginal at the present controlled maximum price of 12 cents 
for copper, makes it unlikely that even the low output level of recent years can 
be maintained. Meanwhile the efflux of workers from the area has been accele- 
rated. The wHancock Employment Office of the unemployment commission 
which serves Houghton, Keweenah, and Baraga Counties, in recently checking 
registrations from active to inactive files, found that about 60 percent of those 
who had failed to renew their cards had left the district, indicating a migration 
of over 2,000 workers. 

In the interests both of arresting further degeneration of the economy of 
this depressed area and of increasing domestic output of copper for defense needs, 
there exists strong justification for authorization by the Federal Price Adminis- 
tration office of a supplementary price scale for copper produced in Michigan 
mines, corresponding to established differential costs. 

Impact of Defense Program on Farm Labor Situation 

Defense production activity in Michigan impinges in a palpable measure on the 
supply and supply price of labor required on general and dairy farms, and in a less 
direct manner upon the interstate migration of seasonal farm labor to the fruit, 
sugar-beet, and onion-growing areas of the State. 

As noted in the first section of this memorandum., the drift from Michigan 
farn.s to southeastern cities which characterized the twenties was reversed during 
depression years of the thirties, and the number of persons reported in the 1940 
census as living on farms in Michigan was over 90,000 m.ore than in 1930. A 
large num.ber of those so reported, however, were properly urban workers living 
on 3- to 10-acre holdings, and engaged in part-time or incidental fruit or vegetable 
farming, poultry-raising, etc. Industrial recovery in the pre-defense period was 
already leading to some return movement to cities, and the number of "census 
farms'' which had risen sharply from. 169,372 in 1930 to 196,517 in 1935, was 
reported as 187,589 in the 1940 census. 

The swelling volume of defense employment is tending not only to draw back 
to cities workers who had retreated to farms or rural villages in depression years, 
and to attract young farni. people, but it has also inevitably induced a rising scale 
of wages for farm labor, under the fam.iliar operation of the principle of "oppor- 
tunity cost." According to the State agricultural statistician's office the weighted 
average of farm wages (with board) in Michigan rose from $30.25 per month in 
July 1940 to $39.75 in July of this year, an advance of over 30 percenx. This 
is occurring at a tim.e when the Governm.ent's food defense program is calling on 
farn^ers to heavily expand production of meat animals, milk, poultry and eggs, and 
canning crops. 

Migration from Michigan farms does not appear so far to be as extensive aa 
claim.ed in certain quarters. Analysis of new applications received at the Detroit 
area offices of the State employment service during the 13-m.onth period August 
1940 through August 1941, reveals that of total applicants num.bering 108, 03H 



NATIONAL DEFENSE MIGRATION 7221 

only 7c3 were classified as havinp been last employed in "agricvilture, forestry, or 
fishing." Of these only 469 gave Michigan as tlieir place of last employment; 
and of these in turn 305 had worked on farms in the immediate Detroit area. 
Doubtless there has been a larger nvovem.ent from. Michigan farm.s to nearby m.anu- 
facturing cities, but the n\ain problem appears to be the r'sing cost of farm 
labor, and of jr.eeting the need for additional help under the defense program of 
expanded food production. . , . at. , • i 

The defense program with its increasing absorption of resident Micliigan workers 
is already giving signs of intensifying the migration of seasonal farm laborers from 
the South. This has been a growing movement in recent years, and has been 
attracted mainly to the small fruit region of Berrien and Van Buren Counties in 
the southwest corner of the State, to the sugar-beet areas of the Saginaw Valley 
and Thumb districts and Lenawee County, to the commercial onion farms in 
south-central counties, and to the mint farms of Clinton County. A survey of 
migrant farm labor in Berrien County, conducted during the 1940 season by the 
Labor Division of the Farm Security Administration indicated an interstate 
influx of at least 10,000 migratory workers, of which 75 percent were white families 
from Arkansas and Missouri (mostly displaced sharecroppers) and the remainder 
mostly single Negro workers from the South. Of 12,400 beet laborers in Michigan 
sugar' factory districts in 1939, over three-fifths came from outside the State, 
mostly Mexicans recruited in Texas. In view of the recent removal of domestic 
sugar' quotas, and of reduced availability of resident workers, a greater influx of 
beet laborers from the South may be anticipated next season. 

So long as less toilsome and more remunerative opportunities of employment are 
available to Michigan residents— intensified as they now are by the defense 
boom— the seasonal influx of Mexican, Negro, and "poor white" labor is an eco- 
noiBic necessity, unless the pattern of Michigan agriculture is to be substantially 
altered. The problem, however, is not merely one of labor supply, but even more, 
one of public health, involving housing, sanitation, medical examination, and 
communicable disease control. The problems and needs in this direction are 
elaborated in the statement prepared by Dr. Moyer, commissioner of the Michigan 
Department of Health, to which the State council of defense urges that the in- 
vestigation committee should give special attention. ^ 

Possibilities of Minimizing Defense Labor Migration 

As developed in the foregoing analysis, the extrem.e concentration in the 
Detroit areas of the primary impact of defense production in Michigan is inducing 
a labor migration which not only creates serious housing and sanitary problems 
in the areas of influx, but is also proving embarrassing to such areas of efflux as 
farming communities and the copper country. And the greater the volume and 
velocity which this m.ovement attains the m.ore formidable will be the dislocation 
and problem, of readjustment when the flood of emergency defense orders subsides. 
Migration of workers from one area to another is advantageous to both localities, 
as well as the workers them.selves, when it results in the needed employment here 
of those who were idle or dependent there. But it is economically wasteful and 
socially disturbing when it draws large numbers of persons from places where their 
services are needed to localities where the intensified labor demand is capable of 
being suppMed from those already resident in the area concerned. As Secretary 
John Lovett of the Michigan Manufacturers' Association has aptly put it, "Star- 
ring the water around does not flU the pail." This suggests the crucial importance 
of planned efforts to minimize dispensable migration and to m.aximize the utiliza- 
tion on defense production of the actual and potent al resident labor supply. To 
the extent that this is realized local pressures will be eased and the problem of 
post-defense boom readjustment be mitigated. 

In the Detroit area the potentially available local labor supply includes the 
following elements : 

(1) APPLICANTS REGISTERED WITH THE DETROIT CENTRAL PLACEMENT OFFICE 

On July 31, registrants in the actwe flies totaled 60,833 of whom. 1 2 percent were 
classed as skilled and 34 percent as semiskilled. While these include an unreported 
num.ber who were seeking merely to change their jobs or had failed to report 
placement to the office, the flgures suggest that the available resident labor 
reserves of the Detroit market have been by no means fully absorbed. They also 
suggest the importance of fuller utilization by employers of the facilities of the 
State employment offices, and of giving preference to resident applicants. 

1 See p. 7552 and Detroit hearings (Agricultural Section), "Report of anEpidemicof Diphtheria Among 
Mexican Migratory Workers in Saginaw County." 



7222 DETROIT HEARINGS 

(2) COLORED WORKERS 

The Michigan Unemployment Compensation Commission in a special report 
last June on Occupational Qualifications of Available Negro Workers Registered 
with the State Employment Service, pointed out that nearly one-fifth of the 
registered applicants in the area served by the Detroit Central Placement Office 
on April 25 were colored, and that of 10,609 colored male registrants 1,282 were 
classified in skilled and 2,547 in semiskilled occupations. Relaxation of certain 
employers' prejudices against the hiring of colored workers would presumably 
serve therefore, both to reduce unemployment and relief loads in the Detroit 
areas, and to lessen the occasion for the drawing in of workers from outside places, 
with its attendant strain on housing facilities. 

(3) TRAINING OF RESIDENT YOUNG PERSONS 

The coordinated vocational education and National Youth Administration 
defense training programs offer significant possibilities of increasing the supply of 
special skills and services required in defense production, both quantitatively and 
qualitativel}', through the selective utilization of resident young persons. At the 
end of Jul}^ Detroit's vocational education program for national defense training 
had nearly 2,000 enroUees in preemployment classes (representing prospective 
new workers) and over 9,000 in supplementary courses (representing the "up- 
grading" or specialized adaptation of men already employed). In addition some 
500 workers on National Youth Administratic;j defense projects were also securing 
instruction in defeii^e occupations. Registration of these trainees with State 
employment offices and cooperation of employers facilitates their placement where 
they can be most efi'ectively used, and their availability as "dilutants", releases 
more experienced workers for "upgraded" tasks. 

(4) TRANSFER OF WORKERS FROM NONDBFENSE PRODUCTION 

The most important po.ssibility of meeting the emergency demand for mechan- 
ical labor in defense production from local sources, both in Detroit and other 
southern Michigan cities, lies in the transfer of exjjerienced mass-production 
workers released by the compulsory curtailment in automobile output for the 
1942 model year. The recent announcement of 4- and 12-month quotas for indi-' 
vidual manufacturers removes the element of uncertainty which has long over- 
hung this inevitable subordination of civilian to defense production, and it affords 
a definite basis on which labor planning can proceed. The shifting of automobile 
workers to defense plants and operations involves delicate questions of seniority 
and grade and job reclassification. The now all-inclusive establishuient of collec- 
tive bargaining in the Michigan automobile industry has proved conducive, 
however, to the negotiated acceptance of standard principles governing these 
issues. In view of the drastic curtailment in automobile output the erection of 
the huge Chrysler and Hudson arsenals and of the Ford bomber i^lant on the 
outer fringe of Wayne County is likely to induce a nuich smaller volume of labor 
migration and to create a less serious housing problem than was earlier anticipated. 
These defense plants lie within commuting range of the present homes of most 
workers in the automobile factories of Detroit, Dearborn, and Poutiac. The 
problem becomes therefore one of improved transportation facilities rather than 
of new large-scale housing projects for incoming migrants. The Michigan High- 
way Department's plan for a system of three-grade access highways to the Ford 
bomber plant between Dearborn and Ypsilanti is indicative of how this problem 
may be met. 

Commuting Versus Migration 

Commuting represents a form of labor mobility in which the worker maj^ 
change his place of employment while retaining his place of residence. As such 
it is generally less disturbing to communities tlian is actual migration on an equiva- 
lent scale, especially where the latter involves the movement of entire families, 
and wliere the employment is of uncertain duration. Work-commuting serves to 
link urban and rural communities and to make for greater social stability. 

According to reports reaching the Council it appears that in m.ost of the larger 
Michigan cities outside Detroit and Muskegon the increased nuii'.ber of workers 
on the pay rolls of factories affected directly or indirectly by defense orders has 
so far been accon'.i)anied by a considerable addition in the en\ployees commuting 
front, surrounding townships and villages rather than by any extensive niigration 
of workers and their families from distant locations. For example, the personnel 



NATIONAL DEFENSE MIGRATION 7223 

manager of the new General Motors forge plant near Lansing, engaged in turning 
out shells, states that not n.ore than 2>^ percent of its present 1,100 err.ployees 
have cone from beyond a 40- to 50-n.ile zone, n.ost of those from outside Lansing 
com.n.uting from their hon.es. 

The n.aintenance by the State employm.ent service of part-tim.e offices in sm.aller 
cities and recent experui.ents in advertising scheduled appearances of its inter- 
viewers in still sn.alJer places served to uncover available workers in shortage 
occupations living in rural centers. For instance, during a recent 5-day appear- 
ance at Caro, a village of 3,000 in Tuscola County, 372 individuals were regis- 
tered, including n.achinists, core workers, n.olders, engine-lathe, and auton.atic- 
screw operators. While the place where such skills are wanted n.ay be beyond 
con .muting range of the place where they are discovered, m.igration of such workers 
witiiin the State serves to reduce the occasion for interstate migration. Fuller 
utilizat^"on by en.ployers of the State en.ploym.ent service with its interdistrict 
and interstate clearing system, and formation of proposed labor-pool agreem.ents 
an.ong local en.ployers' associations, are am.ong the n.ost effective n^.eans of m.axi- 
m.izing the use of local labor supply and mininiizing long-range or unnecessary 
migration. 

Federal Assistance 

Despite all that m.ay be done by intelhgent planning and cooperation within 
the State to m.inim.ize dispensible labor migration, along the hues suggested above, 
and to deal with local housing and sanitary problen.s, the defense production 
program in Michigan has generated certain situations which dem.and special 
Federal assistance. Ani.ong the n ost urgent of these, as em.phasized elsewhere 
in this statem.ent, are: 

(1) Immediate financial provision under the Public Works Administration or 
Lanham Act for carrying out the master plan of the Michigan Stream Control 
Commission and Department of Public Health for sewage disposal in southern 
Macomb and Oakland Counties. 

(2) Provision through the office of the Defense Housing Coordinator for appro- 
priate supplementary housing facilities in the Center Line area of Macomb 
County, and probably between Dearborn and Ypsilanti. 

(3) Additional grants through the United States Public Health Service to per- 
mit more adequate inspection and immunization among migratory farm laborers, 
and the experimental establishment of government camps for such workers under 
the Federal Security Administration where local authorities can be induced to 
concur. 

(4) Approval by the Office of Price Administration and the Reconstruction 
Finance Corporation of a system of supplemental price payments based on differ- 
ential costs for copper produced in Upper Peninsula mines. 



Exhibit A.^Letter From Michigan Defense Council Discouraging 

In-migration 

(The attached letter was sent from the Michigan Council of Defense on July 19 
to the following States: Virginia, Missouri, Florida, Georgia, Arizona, Oklahoma, 
Louisiana, Alabama, Kentucky, North Carolina, Arkansas, South Carolina, West 
Virginia, Texas, Tennessee, Kansas, Mississippi, and New Mexico.) 

July 19, 1941. 

Dear ■ — — ■ — •: It has recently come to our attention from several communities 
in Michigan that there is a growing influx of unskilled labor into Michigan. This, 
of course, is due to the information that has gone out regarding the defense indus- 
tries developing in this State. 

Permit us to call your attention to the conditions as they exist. A great many 
contracts have been allocated to Michigan firms, and many of the plants are 
operating to full capacity, but a number of plants are still under construction, 
namely the tank arsenal, the Ford bomber plant, and the Hudson naval arsenal. 

These plants, with a large total of new jobs, will not be in operation much 
before the middle of November and will not reach their maximum capacity for a 
year. In the meantime, the production of automobiles has been decreased and 
most of the men who are employed in the automobile industry will be absorbed by 
the new defense plants. Besides this there is still a large number of unemployed 
registered with the State employment service to be absorbed by Michigan indus- 
tries. 

With this information our surveys indicate that we have plenty of men available 
in Michigan to meet the labor demand for at least a year. 



7224 DETROIT HEARINGS 

Will yon give out the information through your council of these conditions in 
Michigan and urge the men in your State not to come to Micliigan in hopes of 
getting a job in the defense industry, except as they are assigned through the 
United States Employment Service. 

Winter will soon be here and many of these families coming to Michigan in 
hopes of finding a job are bound to be disappointed. 

Permit us to express our thanks to you in advance for your cooperation in this 
matter. 

Very truly yours, 

Harold A. Furlong, 
Lieutenant Colonel, Medical Corps, Administrator. 



TESTIMONY OF LT. COL. HAROLD A. FURLONG— Resumed 

Mr. Arnold. Would you rather proceed with some questions based 
on that statement, or do you have something to add to it? 

Colonel Furlong. I think I would prefer that you ask the questions. 
I would like to say, however, that in Michigan we very greatly appre- 
ciate the committee's coming here. We feel that it gives us an 
opportunity to present to you information that it would not be possible 
otherwise to present, and I think that the publicity which 3^ou have 
received from all sources has been a splendid indication of the popu- 
larity of your visit here. 

I hope you will receive all the mformation that you desire and, so 
far as the Defense Council is concerned, we will be glad to furnish any 
further information that we can obtain. 

The Chairman. We will extend you the courtesy of presenting any 
additional statement you care to make for our records. You may send 
it to Washington or hand it to our staff here. 

You may proceed. Congressman Arnold. 

Mr. Arnold. Will you summarize briefly for the committee the 
powers and duties of the Michigan Council of Defense, bearing in 
mind, of coarse, that we are particularly interested in a description 
of those duties which relate most nearly to the problems occasioned 
by migration? 

POWERS AND DUTIES OF MICHIGAN COUNCIL OF DEFENSE 

Colonel Furlong. As set up in the recent legislation, the Michigan 
Council of Defense, composed of 11 members, is an advisory, investi- 
gative, and coordinative agency to assist the branches of State, Federal, 
and local branches of government in bringing the defense program as 
closely as possible in touch with the people of Michigan. It has no 
mandatory powers as such. 

MICHIGAN IN-MIGRATION 

Mr. Arnold. Have you any estimates as to the volume of migra- 
tion into Michigan as a result of the defense program, or of the volume 
of migration within the State? 

Colonel Furlong. As you have heard from previous witnesses, 
that is a very difficult problem on which to get any accurate informa- 
tion. We here in Michigan are confronted not only with the seasonal 
migration in and out of the State which is associated with the auto- 
motive industry, but we also have a seasonal agricultural migration 



NATIONAL DEFENSE MIGRATION 7225 

ill and out of the State, associated with the fruit and sugar-beet 
industry particuhxrly, and the onion industry in certain parts of the 
State. ^, 

Those are problems that we ahvays have with us. There has been, 
in addition, some out-migration, particuhirly from the copper-produc- 
ing areas in the Upper Peninsula. Those people are being attracted 
by higher wages in other copper-producing areas, or by the defense 
industries in this part of the State. _ _ 

There is some indication that in certain parts of the State — it is 
rather fragmentary, I admit— that there is a certain amount of in- 
migration nito the State, particularly around Detroit and Muskegon. 

OUT-MIGRATION FROM COPPER AREA 

Mr. Arnold. So from the copper area you are losing residents to 
other parts of the State and to the outside? 

Colonel Furlong. Yes. 

Mr. Arnold. What recommendation has the Defense Council for 
meeting the shortage in health, housing, and educational facilities in 
defense communities? The committee has in mind, for example, the 
situation in Macomb County. 

SITUATION in MACOMB COUNTY 

Colonel Furlong. Well, the Macomb County situation has been 
completely covered in the report that was prepared by the Defense 
Council. We have copies of that here for your consideration.^ 

The situation in ^Slacomb County is that of an area which was, a 
few years ago, largely rural, and which, during the decade of the 
twenties, began to urbanize and then suffered very keenly during the 
depression years and again has shown a very great increase in popula- 
tion. 

For the period between the 1930 and 1940 census there is shown 
an mcrease of about 39 percent in population in that area. It never 
fell off completely. There has always been an upward trend. The 
area for a number of years has been one of the rich agricultural parts 
of the State, and perhaps hasn't developed as quickly as some of the 
counties immediately north of Detroit, such as Oakland County, 
because of the less desirable terrain. 

The development there has been mostly among the men employed 
in the large industries in Detroit. There is a rather substandard 
type of housing in that area caused somewhat by the poor natural 
facilities of drainage. 

We look upon the major problem in the area of Macomb County 
as one of providing a fundamental necessity, an outlet for the sewage 
disposal. 

You asked the question. What recommendations has the Council 
to make? 

The Defense Council has been working with various State and 
local and Federal agencies in an attempt to arrive at a logical solution 
of the difficulty in "that area. It is not only an area of low income, 
but one in which, because of the many adjoining municipalities, there 
are many municipal agencies at work. There is a problem there of 

1 Held in committee files. Data contained in the report arc summarized in Exhibit 25, Social Welfare 
in Macomb County, pp. 7678-7693. 



7226 



DETROIT HEAJRINOS 







I 

L, 



X 
CO 



n- : CO »! I 



NATIONAL DEFENSE MIGRATION 7227 

dealing with a great many governmental agencies, both county and 
local, and it has been complicated for that reason. 

PROBLEM OF SEWAGE DISPOSAL 

Over-all sewage disposal plans have been worked out in that area, 
and we are hopeful that through the recently enacted community- 
facilities bill and through Mr. Carmody's department of government, 
we will eventually be able to work out a solution for the disposal of 
sewage. 

The Chairman. The trouble with that appropriation, Colonel 
Furlong, is that it only provides $150,000,000. San Diego alone is 
askmg for $21,000,000, and California is asking for $50,000,000. With 
the pressing need for sewage disposal and other facilities, in so many 
places, don't you think more money will be required? 

Colonel Furlong. I think that eventually will prove to be the case. 

Mr. OsMERS. What is the population of Macomb County, and what 
plants are going in there, Colonel Furlong? 

Colonel Furlong. The population has increased very much just 
recently. I think I can answer your questions very nicely by showmg 
you a map of the area involved.^ 

This map is of the five counties immediately surrounding Detroit. 
Those [indicating] represent the municipalities. The map further 
reduces the situation to just one township of Macomb County, in 
which there has been a very rapid defense development. This shows 
Warren Township of Macomb County and the industries that are 
located therein. 

POPULATION INCREASE IN MACOMB COUNTY 

The population of Macomb County at the present time is 107,638. 
That was according to the 1940 census. In 1930 the population was 
77,146. The increase indicated for the last 10 years is 40 percent. 

Mr. OsMERS. What would be the cost of this sewer plan that you 
referred to, Colonel? 

PLAN FOR sewage DISPOSAL 

Colonel Furlong. The plan involves two projects. It involves an 
Oakland County project, which is immediately adjacent to Detroit 
on the north, and a Macomb County project. I will show you briefly 
on the map what our problem here is. This is the Macomb County 
line here, and this is the Wayne County line. Oakland County is 
in here. 

All these municipalities in the southern part of Oakland County have 
to depend upon the flow eastward to dispose of their sewage. 

Now, there is a project submitted from Oakland County to connect 
with this large interceptor sewer of Wayne County, to dispose of waste 
that now is traveling down Red Run Creek and Clinton River, out 
mto the lake. There is the intake for Higliland Park, which is located 
within and surrounded by the city of Detroit. Their water intake is 
there and the city of Detroit's water intake is there [indicating]. 

' See facing page. 



7228 DETROIT HEARINGS 

That is one part of the project for Oakhind County. The Macomb 
County portion of the project inchides building a portion of a drain, 
a large interceptor drain in Wayne County from this point, which is 
the Kirby pumping station up beyond the city limits of Roseville. 

In addition, this drain, which is located in here, known as the nine- 
mile drain, has been in litigation over a number of years. That will 
be connected with that interceptor sewer at that point, and will take 
care of this large area in Wayne County, in Warren Township, and 
Centerline. 

That portion of the Macomb County project will cost about $740,000 
or $750,000, and that figure probably will be given in any application 
made under the provisions of the community facilities bill. We hope 
to make it a 100 percent grant. 

Mr. OsMERS. What is the financial condition of Macomb County? 

Colonel Furlong. They are unable to finance that themselves. 

Now, in addition to the interceptor sewers, there are, of course, many 
lateral connecting sewers to be built by each community under separate 
projects of the Public Works Adm^inistration. 

Mr. OsMERS. That is not figured in as part of the $750,000? 

Colonel Furlong. No. 

DEBT LIMITATIONS IN MACOMB COUNTY 

The Chairman. Why is Macomb County unable to participate in 
the project? Is it because of debt limitation? 

Colonel Furlong. Yes. The IS-mill tax limit. There is a very 
high delmquency of tax payments. Many parcels of ground have 
reverted to the State, and the problem isn't just one of sewers alone, 
but of schools and streets and other facilities necessary to develop 
that community. 

Mr. Curtis. After this defense activity is over, what sort of 
community are you going to have there? Are you building for 
permanency? Are there going to be that many people there all the 
time? 

MACOMB county REFLECTING GROWTH OF DETROIT 

Colonel Furlong. The development of that area is part of the 
natural growth of the city of Detroit itself. There is no overlapping, 
no intervening break in the settlement. It is an artificial boundary. 
On one side of the Eight Mile road is Wayne County, and on the other 
side is Macomb County, and the growth has been taking place in the 
last 10 years in Macomb County. Macomb County is a continuation 
of the growth that has been going on in that area of Wayne County 
for the last 25 years. 

Twenty-five years ago certain parts of the City of Detroit were 
faced with these same problems that Macomb County is now facing 
today. Those have been solved in Wayne County and they remain 
to be solved in Macomb County. 

It is simply the result of the depression years and the large unem- 
ployment. The community has not been able to keep up with the 
demand for public services in that area. 

Mr. Arnold. Wliat have they done with respect to education? 
Have they kept up pretty well with that? 



NATIONAL DEFENSE MIGRATION 7229 

NEED FOR ADDITIONAL FUNDS FOR SCHOOLS 

Colonel Furlong. They are having a great deal of difficulty there 
with their schools. Some of the school districts were enlarged in order 
to accommodate the children, and now they are no better than the 
district schools they used to have. Some of the school districts have 
been so contracted that they do not have a sufficient revenue-produc- 
ing possibility to maintain adequate schools. Other districts that 
were built up have greatly exceeded their school capacity. There is 
an urgent need in there of additional funds to operate the schools. 

There is also a need for a long-range program of consolidation of 
school districts, to produce enough revenue to support the schools. 

The assessed valuation of some of these communities has not been 
sufficient to maintain their schools and other facilities to a desirable 
basis and allow for expansion. 

Mr. OsMERS. Now, if this sewage-disposal system is installed, can 
you tell us how many F. H. A. applications will be released? 

Colonel Furlong. I am afraid I cannot answer that question. 

Mr. Arnold. Would there be a great deal of building there? 

NEW HOUSING DEPENDENT UPON SOLUTION OF SEWAGE-DISPOSAL 

PROBLEM 

Colonel Furlong. Yes, sir; there is a demand for building there at 
the present time. Many areas had already been approved for F. H. A. 
loans, but because of the unsatisfactory sewage-disposal facilities it 
was found undesirable to put more housing in that area. 

Individual septic tanks do not work efficiently in that area. The 
underlying soil is a very heavy, impervious clay. It has been impossi- 
ble to carry on with that situation; the result has been a temporary 
delay in opening or granting approval to new areas for F. H. A. hous- 
ing, which will probably continue until such time as the sanitation 
proble- is solved. 

Mr. OsMERS. Does the figure you gave the committee represent 
the approximate cost of the sewer plan up there? Does that include 
the cost of the disposal plant, or is it proposed to pour that sewage 
into the river? 

Colonel Furlong. No. That plan contemplates the connection 
of those deep interceptor sewers with the Detroit sewerage system 
and paying a disposal charge. 

Mr. OsMERs. A gallonage rate, or something like that? 

Colonel Furlong. Yes, sir. 

Mr. OsMERs. Does the Detroit plant have sufficient unused capacity 
to handle it? 

Colonel Furlong. We have been in consultation with the Detroit 
departments, and they can do that. 

Mr. OsMERS. It is always easier to add to an existing plant than 
to build a new one. 

Colonel Furlong. That is right. 

Mr. OsMERs. There is one question I would hkc to ask you about 
this little map that you put before us.^ Am I correct in assuming that 
these two communities of Hamtramck and Highland Park are within 
the city limits of the city of Detroit — completely surrounded by the 
city of Detroit? 
• See p. 7226. 



7230 DETROIT HEARINGS 

Colonel Furlong. Yes, sir. 

Mr. OsMERS. Are they governed as separate municipalities, with 
their own officials? 

Colonel Furlong. Yes, sir. 

Mr. OsMERS. Now, these little squares that j'-ou have numbered — 
apparently they are communities — are incorporated? 

Colonel Furlong. Yes, sir. Those are incorporated villages or 
cities. 

Mr. OsMERS. The blank space you have there is under county 
government. Is that correct? 

Colonel Furlong. Yes, sir; and township. 

Mr. Arnold. I suppose surveys of housmg and educational needs 
have been undertaken in Macomb County and such areas? 

Colonel Furlong. Yes, sir; that is all included in the Macomb 
County report. 

ASSISTANCE TO WARREN TOWNSHIP 

Mr. OsMERS. What assistance, if any, has your organization given 
to Warren Township in securing approval of its request for schools 
recently presented to the Lanham Committee? 

Colonel Furlong. We have been endeavoring to assist them in 
every way possible, including the seeking of cooperation of both 
the State Department of Public Instruction and the United States 
Department of Public Instruction. 

I would say that the major part of our effort in the last 2 months 
has been directed to the solution of the problems in Warren Township 
and Macomb County. 

Mr. Arnold. Does Macomb County have a health department? 

Colonel Furlong. No; it does not. That is one of the things that 
is very badly needed there. 

Mr. OsMERS. Does the State law^ of Michigan provide for the 
creation of coimty health departments? 

COUNTY HEALTH DEPARTMENTS IN MICHIGAN 

Colonel Furlong. Yes. Only 65 out of the 83 counties in Michigan 
have county health departme^its. They are receiving funds both 
from the State Department of Health and from the Federal Govern- 
ment in support of those departments. 

Mr. Arnold. Are there quite a few trailer camps up there? 

Colonel Furlong. Yes, sir. Some are regulated and some not. 
I am inclined to feel that it isn't as bad as it might have been painted, 
however. 

Mr. Arnold. You think some steps have been taken to supervise 
camps under the new statute that w^as enacted? 

Colonel Furlong. Yes, sir. 

Mr. Arnold. Does the F. H. A. guarantee a mortgage in Warren 
Township? 

Colonel Furlong. I w^ould like to have that question referred, if 
possible, to Mr. Foley, wdio is the FederalHousing Administrator here. 
He is here, if you would like to ask him that question. 



NATIONAL DEFENSE MIGRATION 7231 

TESTIMONY OF RAYMOND FOLEY, MICHIGAN STATE DIRECTOR, 
FEDERAL HOUSING ADMINISTRATION, LANSING, MICH. 

Mr. Arnold (to Air. Foley). Will you answer that? Does the 
F. H. A. guarantee a mortgage in Warren Township? 

Mr. Foley. Yes, sir; certain parts of Warren Township. Warren 
Township includes some established communities as well as township 
areas. In some parts we can insure a mortgage and in other parts 
we can't. 

Mr. Arnold. Will you give us your full name? 

Mr. Foley. Raymond Foley. 

Mr. Arnold. And your official capacity? 

Mr. Foley. State director of Federal Housing Administration. 

The Chairman. Thank you, sir. 

TESTIMONY OF LT. COL. HAROLD A. FURLONG— Resumed 

Mr. Arnold (to Colonel Furlong). The report of your council 
stated that the number of people migrating from the Upper Peninsula 
to the defense areas is reaching serious proportions. t\Tiat are the 
causes for this? 

DECREASE IN COPPER PRODUCTION 

Colonel Furlong. There are four counties in the Upper Peninsula 
whose economy, you might say, has been developed around the copper- 
mining industry. Those mines have become high-cost production 
mmes. With the price of copper placed at 12 cents, only six of those 
mines are operating at the present time. 

Mr. Arnold. Six out of how many? 

Colonel Furlong. Six out of about nineteen. The selling price, 
with the increased cost of labor in that area, has further reduced and 
will probably further reduce the copper production m Michigan 
unless some differential is established for Michigan copper. 

They cannot compete with the low-cost-production mines in other 
parts of the country. It costs them about 10 cents a pound to get 
some of their copper to the surface up there, and when copper is 
below 10)^ cents a pound they cannot operate. 

Mr. Arnold. You speak in your statement of planned efforts to 
minimize dispensable migration. Applymg this to the Michigan 
situation, could nothmg be done to deal with that migration except to 
allow a differential? 

Colonel Furlong. On Michigan copper; yes. 

Mr. Arnold. Quoting your statement: 

A W. P. A. re])ort notes that in a sample check of migration for a given period, 
more than half of the migrants reported were unaccompanied by dependents. 

Would you say that this was of sufficient weight of itself to assume 
that housing and school facilities demanded would be proportionately 
less? 



60396— 41— pt. 18 12 



7232 DETROIT HEARINGS 

Colonel Furlong. I think it should have some bearing on the de- 
mands in the estimates of housing. 

Air. Arnold. In connection with your assumption in your state- 
ment that full utilization of local labor supplies, including hiring of 
Negro workers, would lessen the need of outside workers, has the 
Michigan Defense Council conferred with employer groups, with a 
view to determining the extent of discrimination and the means to 
mieet the situation? 

Colonel Furlong. We have had no such conferences. 

WORK AREAS FOR MACOMB COUNTY RESIDENTS 

Mr. Curtis. Coming back to this Macomb County situation, where 
do all those people work who have moved in there? 

Colonel Furlong. Some of them in Detroit, some in Dearborn, 
and some in Pontiac. 

Mr. Curtis. Have any new defense plants been located in the 
county? 

Colonel Furlong. Oh, yes. 

Mr. Curtis. Wliat are they? 

Colonel Furlong. The largest is the new Chrysler tank arsenal, the 
Hudson naval arsenal, and the Dodge truck plant. There is a large 
steel plant along the Eight Mile Road, and a number of other plants. 
They are listed on the map there. 

Mr. Curtis. What is the total volume of the contracts, in dollars, 
that have been awarded to that county in the present defense program? 

Colonel Furlong. I would have to look that up. 

Mr. Curtis. Have any training camps. Army cantonments, or any- 
thing of that sort been established there? 

Colonel Furlong. Selfridge Field is in that same county. That is 
east of Mount McClemens, which is in Macomb County. 

Air. Curtis. And that is the only one? 

Colonel Furlong. That is the only one in the county. 

tax-exempt PLANTS 

Air. Curtis. Then of the new activities that have been brought 
there, that would be the only one exempt from local taxation? 

Colonel Furlong. No; the Chrysler tank arsenal and the Hudson 
naval arsenal are both Government-owned and operated, one with the 
services of the Chrysler Corporation and the other the Hudson 
Motor Car Co. They are just as much a Federal arsenal as is Rock 
Island Arsenal. 

Air. Curtis. They are owned by the Federal Government? 

Colonel Furlong. Yes, sir. 

Air. Curtis. And not on the tax rolls? 

Colonel Furlong. Not on the tax rolls. And they are of them- 
selves creating a further difficulty in that area because of the increased 
demand for facilities such as the disposal of sewage. 

Air. Curtis. Then would you say the greater portion of those new 
plants and establishments that have been placed there are tax-exempt 
plants so far as their physical properties and equipment is concerned? 

Colonel Furlong. Yes, sir; and that is a very serious problem, not 
onlv there, but in similar arsenals that have been established through- 



NATIONAL DEFENSE MIGRATION 7233 

out the country. For instance, such an arsenal is located at Warren, 
Ohio. 

There should be, in my opinion, some serious consideration given 
to the possibility of a service charge for the use of necessary facilities, 
inasmuch as there is no return to the county for that service. 

Mr. Curtis. The community gets the benefit of the pay roll. 

Colonel Furlong. Yes; but that may not be sufficient to meet the 
demands upon the community to furnish these facilities. 

The Chairman. Thank you very much. Your paper and discussion 
have been a very valuable contribution to our record and we appreciate 
your coming here. 

Colonel Furlong. I think I will have the opportunity tomorrow 
afternoon of showing you some of this territory. 

The Chairman. And we will take advantage of that opportunity, 
Colonel. 

Colonel Furlong. I think you will find it very interesting. I would 
like to leave with the committee some outline maps which you may 
find helpful,^ and should there be anything else that you desire in the 
way of accommodations here, we will be very glad to be of assistance 
to you. 

The Chairman. We thank you very much. Colonel. Our next 
witness is Major Gardner. 

TESTIMONY OF MAJ. ROSS L. GARDNER, AUTOMOTIVE LIAISON 
SECTION, CENTRAL PROCUREMENT DISTRICT, UNITED STATES 
ARMY AIR CORPS 

The Chairman. Major, we appreciate your coming here this 
afternoon to help this committee in its hearing. 

Major Gardner. And I am very glad to be here, sir. 

The Chairman. Congressman Osmers will ask you the questions. 

Mr. Osmers. Major Gardner, we are very much interested in the 
way aircraft production is going to affect the economy of Alichigan, 
particularly in the automobile industry, and in the transition from 
automobile production to aircraft production. The statement you 
have submitted will be incorporated into the record. 

(The statement referred to above is as follows:) 

STATEMENT BY MAJ. ROSS L. GARDNER, AUTOMOTIVE LIAISON 
SECTION, CENTRAL PROCUREMENT DISTRICT, UNITED STATES 
ARMY AIR CORPS 

The Automotive Liaison Section is a coordinating, rather than an administrative 
section, and deals with automotive concerns having aircraft engine or plane con- 
tracts. Its functions consist principally of assisting contractors to avoid or over- 
come delays in production on their particular contracts. It also studies the 
schedules, training of personnel, and, in general, keeps its fingers on the pulse in 
order to note anj^ changes which might cause delay. 

Defense items covered by its activities are airplanes, engines, and their com- 
ponent parts. 

Due to changes taking place constantly in contracts, for the most part t)eing 
revised upward, it would be practically impossible to estimate the peak labor 
force required. 

The same would apply to peak production date. 

Since the transition from automotive or nondefense employment takes place 
gradually, due to time required for training for such transition, and due to changes 

1 See pp. 7219 and 7226. Other maps submitted by Colonel Furlong are held in committee files. 



7234 DETROIT HEARINOS 

as before stated in contracts, no estimate can be given as to what additional labor 
force may be required for peak production. 

Speaking from observations made in this area, there do not appear to be any 
serious proi)lems either with regard to training, availability of labor supply or 
transferability of present automobile personnel to defense work. 

As stated previously, it would be extremely difficult to estimate by stated 
periods or monthly estimates the rate at which present defense contracts may be 
expected to absorb labor force being laid off because of a curtailment in automobile 
production. 

TESTIMONY OF MAJ. ROSS L. GARDNER— Resumed 

Mr. OsMERS. I wonder if you would be good enough to give some 
general views on the problems of transition from motorcar to airplane 
manufacture? 

TRANSITION FROM MOTORCAR TO AIRPLANE MANUFACTURE 

Major Gardner. Aircraft work is a rather slow process at this tune' 
due to the fact that the automotive plants are, of necessity, having 
to retool their whole plant facilities to a different kind of business. 

At the present time there is a rather great shortage of tool and 
die makers and fixture makers. It is taking longer to accomplish 
that retooling than it would under normal circumstances. 

Mr. OsMERS. Would you explain, Major, your duties with relation 
to that job? 

Major Gardner. They cover practically everything involved in 
the production of aircraft. 

Mr. Osmers. You are located in Michigan, are you? 

Major Gardner. The headquarters of the central procurement 
district are located in Detroit. They have recently been moved up 
from Wright Field, Dayton, Ohio, because this is the center of the 
automotive industry, and since so many large contracts have been 
given to the automotive industry, it was felt that it was much more 
advantageous to have the headquarters of the central procurement 
district located where those plants were centered. 

Mr. Osmers. I wonder if you would tell us something of your 
experience. I understand from members of the committee staff that 
you have had a wide experience in aircraft production. 

Major Gardner. That has been my sole business for 31 years. 

Mr. Osmers. I wonder if you would be good enough to tell the 
committee a little about the normal peacetime operations of the 
aircraft industry and the normal peacetime operations of the auto- 
mobile industry, and then we might see how they are going to fit 
together. 

Major Gardner. Up to the time of this emergency, the normal 
facilities of the aircraft industry were sufficient to supply the needs 
of both the Government and the commercial operators. There was 
no need for the use of mass-production methods. 

mass-production methods required 

When the emergency arose, it was found that instead of buUding 
in terms of a few hundred planes, it was a matter of building in terms 
of many thousands of planes, in a veiy short space of time. This, 



NATIONAL DEFENSE MIGRATION 7235 

of course, would require different methods of production from those 
normally used in the aircraft industry. 

Up to the time of the emergency all planes had been custom-buOt. 
They had not been built under the method that is a very integral 
part of the automotive industry. It takes longer to lay out a plane 
on the board before it goes into production. Many things take 
place before it actually does go into production. Many tests are 
made, which are not necessary in automotive construction. 

They lay down a design for an automobile and build the tools and 
stamp it out by the hundreds, and that is their method. That isn't 
true of the aircraft mdustry, so that it has taken quite a little time to 
bring about the changes needed for mass production of aircraft, using 
the initiative and the production methods that are employed in the 
automotive industry. 

Mr. OsMERS. Do you feel that the transition can be made from 
building automobiles to building airplanes? 

Major Gardner. Oh, yes. 

Mr. OsMERs. Do you feel that we can apply automotive-manufac- 
turing methods to the aircraft industry? 

Major Gardner. To a certain extent. 

Mr. OsMERS. To a larger extent than has obtained in the past? 

Major Gardner. Yes, sir. 

Mr. Osmers. Is it true, as has been contended, that automobile 
tools are almost wholly unadaptable to the manufacture of airplanes? 

Major Gardner. That is not true. 

Mr. Osmers. It is fair to assume that heavy contracts for aircraft 
have already been placed with the automobile makers and more are 
on the way, or you would not be in Detroit. 

Major Gardner. That is right. 

Mr. Osmers. I wonder if you could give the committee some idea 
of the size and extent of these aircraft contracts that have been placed 
with the auto makers. 

Major Gardner. We don't have anything to do with the letting of 
contracts. We are only concerned with them after they have been let. 

Mr. Osmers. I mean those that have been let. 

Major Gardner. As to that I could not say. I could not give you 
a figure on that. 

problems of transition to mass-production-made planes 

Mr. Osmers. What are some of the latest developments in making 
this transition from the custom-made airplane into mass-production- 
made airplanes? 

Major Gardner. The integral parts of a plane have previously all 
been formed by hand. Now, it is a matter of teaching them how to 
form them by hand equipment. Instead of making a few hundred 
parts, we are going to make many thousand parts of the same kind, so 
machines have to be devised to make those parts, to turn them out in 
large quantities. 

Mr. Osmers. We have a statement that was submitted by Mr. 
Robert W. Conder, of the Chrysler- Corporation. He says: 

We expect to recruit substantially all employees necessary for our defense 
program from among our own employees of the automobile plants.^ 

» See 7322. 



7236 DETROIT HEARINGS 

Is that presuming that they have the requisite skills in the Chrysler 
Corporation, for example, to make airplanes? 

Major Gardner. No; it is necessary to train any automotive per- 
sonnel for a specific job. The problem has been to teach men in air- 
craft production in large numbers one specific job, the same as they 
do in the production of automobiles. 

The automotive men have not been in the habit of using riveting 
in their production, while that is a large part of the program in aircraft. 

RIVETING AS A NEW SKILL 

Mr. OsMERs. Riveting is entirely new in the automotive field? 

Major Gardner. Not only that, but it is a very exacting process 
because in using flush riveting, as it is known, you have to be very, 
very careful in getting a very smooth surface. Any indentation m the 
metal, or any obstruction caused by a mishandled rivet sets up a 
turbulence in the air and causes a cracking of the "skin." 

Mr. OsMERS. Have you any estimate of the percentage of the auto 
workers who may be transferable, either directly or after trainmg, to 
the production of aircraft? 

EIGHTY PERCENT OF AUTOMOTIVE PERSONNEL WOULD BE TRANSFERRED 

TO DEFENSE PROGRAM 

Major Gardner. To my knowledge, here hi my own contact with 
the training program, I would say roughly 80 percent of the auto- 
motive personnel could be diverted, not necessarily to aircraft, but to 
the defense program. 

Mr. OsMERS. Wliat are some of the special problems involved m 
the training program for the Detroit worker before he enters into 
aircraft production? 

training PROBLEMS 

Major Gardner. There are quite a number of problems here, due 
to the fact that there are several methods of training. There is what 
is known as T. W. I. training — training-within-industry — national 
vocational training for defense program, and the contractor's own 
school, set up by the contractor himself, in which he undertakes to 
train his own personnel. 

The breaking down of the number of hours required has been quite 
a problem. In fact, it isn't satisfactorily answered yet. Some of the 
operations require as much as 480 hours of training. Even though 
the worker may have been employed in the automotive industry for 
the last 10 or 15 years, he has to learn how to do a specific job hi a 
certain way. He can't do it the way he normally w^ould do it from 
his own knowledge of mass-production methods hi the automotive 
industry. 

HOURS OF training REQUIRED 

Mr. OsMERS. I suppose jobs requiring 480 hours of training are few 
and far between, are they not? 

Major Gardner. Approximately 12 percent of those required for 
aircraft manufactui'e. Then that varies. It runs down to as low as 
65 hours for other jobs. 



NATIONAL DEFENSE MIGRATION 7237 

Mr. OsMERS. What are your own duties here, Major? Do you go 
to the plants and get right into the problems? 

Major Gardner. Yes, sir. 

Mr. OsMERs. Is that your function? 

Major Gardner. I take up every problem that has to do with the 
expediting of the production of aircraft. 

Mr. OsMERS. You are not an administrative agent? 

Major Gardner. No; just a coordinator. 

MODEL CHANGES RETARDING PRODUCTION 

Mr. OsMERS. Are you running into difficulty due to the fact that 
the mass-production manufacturer wants you to freeze your models 
while your designers and officials at Washington are constantly chang- 
ing and improving? 

Major Gardner. Yes. 

Air. Osmers. I suppose you just have to make the best of it. 

Major Gardner. The findings as a result of activities on the war 
front at the present time are causing these changes to be made. New 
determinations are made as a result of their activities over there. 

Mr. Osmers. Is it impairing production? 

Major Gardner. It is retarding it. 

Mr. Osmers. Seriously? 

Major Gardner. Yes, seriously. There are, however, two or tlu'ee 
types of planes that have been frozen as to their present status, and 
production is going ahead on them. 

The Chairman. Major, one of the witnesses this morning expressed 
a fear that this spreading of defense-contract plants outside of the 
Detroit area might cause those outside plants to go into the production 
of automobiles after this emergency period is over. Are you afraid 
of that? 

Major Gardner. Would be liable to do what? 

The Chairman. In other words, with the spreading of defense 
contracts throughout the country — industries tooling up for that 
kind of production — might they be in position to manufacture auto- 
mobiles, after the emergency, where none has been manufactured 
before? 

Major Gardner. I don't think that is true. 

The Chairman. Our only suggestion was that if they press them 
too hard throughout the country, the Detroit area can take to the 
manufacture of airj^lanes. 

Major Gardner. That woidd depend on the demand for airplanes. 

The Chairman. You have studied this problem for 31 years, Major? 

Major Gardner. Yes. 

EXPECTED expansion OF AIRPLANE USE AFTER EMERGENCY 

The Chairman. And do you look forward to a great expansion of 
airplane production after this emergency is over? 

Major Gardner. For civil use, yes. 

The Chairman. Even to the carrying of freight? 

Major Gardner. Yes; that is contemplated right now. As a 
matter of fact there are three undertakings along that line that will 
be under way very shortly. 



7238 DETROIT HEARINGS 

The Army has a very serious problem in air transportation of cargo. 

The Chairman. Now, Major, with all due respect to the Army 
and Navy, there is one point that was brought up by a witness this 
morning, which I should like to place before you. It has been charged 
that the Army is storing, unnecessarily, surplus materials that are 
needed by nondefense industries. Do you see any evidence of that 
around here? 

ARMY NOT UNNECESSARILY STORING MATERIAL 

Major Gardner. No, sir; we have to allocate aluminiun in quan- 
tities of 5 pounds. I don't think that is storing material. That is 
not true. 

The Chairman. As an officer in the Army, you have found no 
physical evidence of it around here? 

Major Gardner. None whatever. 

Mr. Arnold. In Chicago last week, at a meeting of manufactm-ers 
who were desirous of securing allocations of material for nondefense 
work, some one made the suggestion that at the Rock Island Arsenal 
a 5-year supply of some materials had been stored up, whereas they 
could have got along very well with a year-to-year supply. Do you 
know anything about that? 

Major Gardner. I think that would have to be determined by the 
Army staff. I think their judgment would have to be given consid- 
eration there. 

The Chairman. In other words, it is something about which you 
have no knowledge? 

Major Gardner. That is right. 

Mr. Osmers. Major Gardner, to get back to ahcraft manufacture, 
are some companies substituting other methods for riveting? 

no changes in method for riveting 

Major Gardner. Not without the permission of the Air Corps. 
Nothing is permitted to be changed without the approval of the Air 
Corps. 

Mr. Osmers. Has approval been given for changes in construction? 

Major Gardner. No. 

Mr. Osmers. For an operation that would substitute for riveting? 

Major Gardner. No, sir. 

Mr. Osmers. That would be considered a very vital and basic 
change, which would probably take several months to determine? 

Major Gardner. Yes; due to the fact that at the present time there 
are 783,000 rivets- 
Mr. Osmers. It has been suggested that some of these plants ought 
to try welding instead of riveting. 

Major Gardner. It has been suggested that that bo approved. 
However, at the present time it has not been approved. 

Mr. Osmers. But it is under consideration and in process of 
experimentation, is it? 

Major Gardner. The material used for skin covering of the plane 
is too thin to weld. 

Mr. Curtis. Major, this aluminum that is being conserved, the 
greater portion of that goes into airplane production, does it not? 

Major Gardner. Yes, sir. 



NATIONAL DEFENSE MIGRATION 7239 

Mr. Curtis. I don't laiow that this bears on the investigation, 
but I want to know for my own personal information, is this used 
aluminum that was gathered up in the various communities, in the 
form of old pots and pans and coffee percolaters, melted down and 
made into aluminum which is used in airplanes? 

Major Gardner. No, sir. 

Mr. Curtis. It cannot be used for that? 

Major Gardner. No, sir, 

Mr. Curtis. What is it good for? 

Major Gardner. Good for other uses of aluminum not connected 
with airplane skin-cover. 

Mr. Curtis. To make more pots and pans? 

Major Gardner. No, sir; it is used for forgings, for castings, and 
things of that short. 

Air. Curtis. In what industries? 

Major Gardner. In various industries; in aircraft engines. 

Mr. Curtis. But it is not being used for aircraft engines? 

Major Gardner. I could not say that. We have nothing to do 
with scrap material except the disposal of it back to the aluminum 
company. Wlxat becomes of it there, we have no knowledge. 

Mr. Curtis. But the fact that it is turned back into the whole 
industrial set-up makes that much more virgin aluminum available 
for aircraft construction? 

Major Gardner. That is right. The same holds true of materials 
that are used in the training schools where they are teaching riveting 
and metal forming and the various operations in connection with 
aircraft production. They buy what is known as seconds of alumi- 
num sheets — those that have been scratched and can't be used in 
aircraft for skins. They return that and are paid so much a pound 
for it as scrap material or second material, and they return it and 
receive so much per pound for it as scrap material. 

The Chairman. Major, we thank you very much. You have 
made a fair and intelligent statement, and we thank you for coming 
here. 

Major Gardner. Thank you, sir. 

The Chairman. Our next witness is Mr. Edwards. 

TESTIMONY OF GEORGE EDWARDS, DIRECTOR-SECRETARY, DE- 
TROIT HOUSING COMMISSION, DETROIT, MICH. 

The Chairman. Mr. Edwards, Congressman Curtis will question 
you. 

Mr. Curtis. Mr. Edwards, will you give your name to the reporter? 

Mr. Edwards. George Edwards. 

Mr. Curtis. What is your official position? 

Mr. Edwards. I am director-secretary of the Detroit Housing 
Commission. 

Mr. Curtis. You have a prepared statement, do you not? 

Mr. Edwards. Yes, sir; I have submitted a prepared statement^to 
the committee. 

Mr. Curtis. That will be received in the record. 



7240 DETROIT HEARINGS 

(The statement referred to above is as follows:) 

STATEMENT BY GEORGE EDWARDS, DIRECTOR-SECRETARY, 
DETROIT HOUSING COMMISSION 

Defense workers migrating into Detroit find themselves face to face with a 
housing sliortage — a shortage imrticularly acute in the lower rental bracket. 
Satisfactory^ homes, at low rentals, are ahnost nonexistent. 

The luanber of available vacant dwellings for rent have been decreasing for 
some time. As recently as 1938, when the real property inventory was conducted, 
5.06 percent of the citv's dwelling units were found to be vacant. The percentage 
of vacant units diminished to 3.5 percent in 1940, when the Federal census was 
enumerated, and a further decrease to 2.2 percent was recorded in February 1941, 
when a sample vacancy snrvev was conducted by the Work Projects Administra- 
tion at the request of the Division of Defense Housing Coordination. This survey 
revealed that, after eliminating all units not for rent, units in which major repairs 
were needed, and those unfit for use, only 4,050 units (0.9 percent of the city's 
total) remained available for rent and in good and fair condition. Recently the 
homes registration office of the Detroit Housing Commission, in conducting a 
survey, found less than 1 percent of the city's dwellings to be vacant. Thus, m 
spite of consideraljle building activity, the available liousing seems to be appraoch- 
ing the vanishing point. . . , r 

It cannot be denied that this is a black picture to present to incommg defense 
workers in search of satisfactory homes. How many such defense workers there 
will be is difficult to estimate. According to a labor market bulletin issued by 
the Michigan Unemployment Compensation Commission on July 22, 1941, it was 
anticipated that the total employment in defense industries in the Detroit area 
would be increased by approximately 68,000 workers in the period ivom July 
1941 to January 1942. This figure does not take into account the number of non- 
manufacturing jobs that would also be created. However, many of the large 
defense plants in the Detroit area will not have been completed by January 1942. 
Many others will not be in full production until some time after. The Ford 
bomber plant, which will employ between 40,000 and 60,000 workers, the Chrysler 
tank arsenal, Hudson naval arsenal, and the Packard aircraft plant, are a few of 
the larger defense plants that fall in these classifications. The amount of migra- 
tion resulting from this employment need, would, of course, in great measure 
depend upon the amount of auto curtailment made effective. In any event, the 
city of Detroit is very poorly equipped to house an incoming migration of defense 
workers in any amount. 

WORK PRO.TECTS ADMINISTRATION STUDY OF MIGRATION INTO DETROIT 

A recent study made bv the Work Projects Administration during the early 
part of June, 1941, entitled "Recent Migration into Detroit and Environs" bears 
out the seriousness of the housing situation. Of the 16,300 families who had 
migrated into the Detroit area since October 1, 1940, only aoout one-third occu- 
pied a separate dwelling unit when enumerated. Well over half of the families 
had doubled uj) with others, and one-tenth were living in hotels and trailers. 
Not a very pretty picture in spite of the fact that it should be noted that many 
families had moved to the Detroit area without all their normal family members. 
It should be emphasized that reasonably satisfactory housing facilities must be 
made available if migrant families are to bring in all of their normal family 

IIlGllll)GrS 

The Common Council of Detroit has refeognized considerable danger in the 
housing situation and has recently taken steps to alleviate conditions. A rent- 
investigation committee has been appointed, under the chau-manship of Council- 
man John Smith, and including in its membership a number of Detroit's l^^ading 
citizens representing various walks of life. This committee has divided itself 
into three mediation panels, every one of which meets periodically and investi- 
gates many rental disputes. The purpose of the committee is to arbitrate dis- 



NATIONAL DEFENSE MIGRATION 7241 

putes between landlord and tenant and to make an attempt to prevent an infla- 
tionary run-away in rentals, which will inevitably happen if numbers of defense 
families migrate into this city, unless vigilant control is exercised. IVIany of the 
cases that have come to the attention of the committee indicated rent increases 
of 40 percent and more. The greatest cause for anxiety, however, lies in the 
I)raetice on the i)art of the landlord of evicting one tenant in order to rent to another 
at a higher rate. 

Relief families are especially vulnerable to this source of attack. They cannot 
compete with workers in seeking and maintaining standard housing accommoda- 
tions. G. R. Harris, general superintendent of the Detroit Department of 
Public Welfare, in a recent letter to the Joint Committee on Housing, said: 
"By reason of their unfortunate circumstances, families with no incomes must 
take what is left after the employed have their choice." 

"With Detroit's active part in the defense program, housing is becoming 
more and more a community problem," he continued, "slowly but surely the 
pressure of demand is causing the relief families to be evicted from any dwelling 
which is not substandard. It has been necessary to provide emergency shelters 
to house families for whom we cannot find accommodations in the community. 
In the present emergency it would appear that we must increase the number of 
these shelters. This, of course, is no solution, but it is a means of meeting a 
daily emergency situation." 

Conditions in suburban areas are no better. In most of these areas they are 
actually worse. Lack of facilities for the proper enforcement of building and 
health codes has resulted in a mushroom growth of shacks and jerry-built cottages 
in the unrestricted areas about the city. The lack of sewers and water supply 
have added to the burden, especially in Warren, Lake, and Erin Townships, in 
Macomb and Oakland Qounties, where the lack of proper sewage disposal has 
already resulted in pollution in Red Run Creek, the Clinton River, and Lake 
St. Clair. Pollution is always the forerunner of epidemics, and once serious 
epidemics break out the citizens of Detroit will not be immune just because they 
live across the line to the south in Wayne County. 

L.\CK OF HOUSING IX DETROIT 

The lack of adequate housing in the city of Detroit has been a public concern 
for some time. For many years little factual material was available. During the 
year 1939, however, the time arrived when it became possible to express housing 
conditions in statistical terms, since at this time the results of the real-property 
survey of the city of Detroit became available in complete form. This survey, 
conducted withiii the limits of the city of Detroit during the period from March 
1938, through September 1939, was sponsored by the Detroit Housing Commission 
and conducted under the Work Projects Administration. A striking condition 
disclosed by the survey is that a considerable number of people in the City of 
Detroit were living in dwellings and under conditions that are considered unsafe 
and insanitary. For instance, 70,781 dwelling units were found to be sub- 
standard 1 out of a total of 414,658 units. Only 3,537 of the substandard units 
were found to be vacant. 

The real-property surve.v conducted sample surveys to determine the income of 
tenant families living in substandard housing. It was found that over 76 percent 
of the 52,125 tenant family groups living in substandard housing were earning 
less than $1,400 per year. 

The survey brought to light the dearth of available satisfactory vacant units at 
rentals compatible with the income of these people. Although 5.06 percent of 
the city's dwelling units were found to be vacant, only 4,443 were available at 
rentals of less than $30 per month; and 58 percent of the latter were found to be 
unfit to live in. Thus, the number of available vacant units, fit to live in, renting 
for less than $30 per month, amounted to less than 5 percent of the number of 

1 A dwelling unit was considered substandard if any one or all of the following conditions existed in connec- 
tion therewith: In need of major repairs; unfit for use; less than 1 flush toilet; less than 1 bathing unit; no 
running water; no installed heating; neither electric norgas lighting; number of persons per loom 1.51 ormore: 
any number of extra families, one of which contains 2 or more persons (exceptions are made to the last two 
conditions when the monthly rent is more than $40). 



7242 



DETROIT HEARINGS 



tenant family occupants of substandard housing who were earning less than 
$] ,400 annually. (See following table:) 

Total numhtr of tenant family groups living in substandard dwelling units in ike 
city of Detroit, by income and size of family 



Total annual family 


Size of family 


Total 


income 


2 


3 


4 


5 


6 


7 


8 or more 


families 


Under $400 . 


3,706 

1,599 

3,744 

1,946 

2,132 

1,670 

1,237 

602 

669 

852 

49 


1,856 

957 

2,430 

1,356 

1,770 

1,302 

1,005 

492 

558 

754 

13 


1,027 

644 

1,440 

1,084 

1, 222 

881 

844 

283 

379 

679 

7 


532 
262 
1,088 
649 
678 
462 
451 
243 
201 
428 


442 
188 
481 
388 
358 
335 
298 
133 
168 
237 


260 

89 

355 

199 

249 

187 

160 

70 

71 

208 


382 
167 
483 
404 
310 
292 
246 
179 
169 
427 
7 


8,205 
3,906 
10,021 
6,026 
6,719 
5,129 
4.241 
2,002 
2,215 
3,585 
76 


$400 to $599,.. 


$600 to $799 


$800 to $999 


$1,000 to $1,199 

$1,200 to $1,399 

$1,400 to $1,599 

$1,600 to $1,799 

$1,800 to $1,999 

$2,000 or more 

Not reported 












Total. - .- 


18, 206 


12, 493 


8,490 


4,994 


3,028 


1,848 


3,066 


52, 125 





Source: Real-property inventory, Detroit, 1938-39. 

The urgent need for more adequate housing, demonstrated by these statistics, 
poses one pertinent question: To what extent has private enterprise applied itself 
to this problem? To ascertain an answer we can review the records for the 
10-year period 1930-1939, inclusive. If we do so we discover that the net gain 
in the number of dwelling units erected was actually less than the increase in the 
number of families for the period. 

Comparison of net gain in divelling units with increase in fatriilies, 1930 to 1989, 

inclusive 

Number of new dwelling units constructed ' 34, 889 

Number of dwelling units demolished 5, 774 

Net gain in dwelling units 29, 115 

Estimated increase in number of families (United States Census) 55, 243 

Excess of increase in number of families over net gain in number of dwell- 
ing units 26, 128 

• Included 1,624 public low-cost housing units. 

(While the population of the citj' increased by only 3.5 percent in 10-year 
period the number of families increased b.v 12.9 percent.) 

RESIDENTIAL CONSTRUCTION FOR RENTAL PURPOSES 

Of especial concern for the community was the attitude of private capital toward 
providing rental housing for the community. An accompanying chart (see facing 
page) illustrates the amount of residential construction during the decade and 
demonstrates that only an infinitesimal amount was for dwelling rental purposes. 
The bulk of the construction was in single homes, which are not built for rental 
purposes. Construction of two-family dwellings, usually occupied one-half by 
owners, was nominal; while construction of apartments, which are l)uilt solely for 
rental purposes, was almost at a standstill. Moreover, the chart shows that most 
of .the apartments that were erected were the public low-cost low-rent projects. 

Out of 33,265 dwellings erected by private capital in the lO-j^ear period, 1930-39 
inclusive, within the city limits of Detroit, only 3,995 units or 12.1 percent were 
erected for rental purposes. Out of the 10,505 units erected in 1940 only 8 per- 
cent were in apartments or two-flats. The balance were single houses erected for 
owners. The first 8 months of 1941 do not materiallj^ change this picture. In 
this period 8,226 new units were provided, 95.8 percent or 7,882 of which were 
single houses. 

The following table (p. 7244) shows the number of single family residences that 
have been erected in Detroit (total for which building permits were issued) classified 
in accordance with construction costs, for the years 1939, 1940, and 1941. It is 



NATIONAL DEFENSE MIGRATION 



7243 



evident from the table that some effort is being made to lower the construction 
costs of single houses. In 1939, for instance, the average cost per unit was 
$5,780 as compared to $5,530 for the first 8 months in 1941. (These cost estimates 
are building department figures increased by 15 percent to arrive at a better 
market figure.) Using the generally accepted rule that a family can afford to 




»3t 1933 1934- 193% 1936 1937 »938 1939 



live in a dwelling of value twice as great as family income, it will be seen that only 
4.5 percent of the houses erected in the first half of 1941 were within the reach of 
families with less than $1,725 annual income; 27.9 percent were within the reach 
of families with incomes between $1,725 and $2,300; and 67.6 percent of all homes 
erected were built for families with incomes in excess of $2,300. It is quite evident, 
then, that current construction is not in any great degree intended for the low- 
income market. 



7244 DETROIT HEARINGS 

Total number of single residences erected in city of Detroit 



Costi 



1939 



Number Percent 



Number Percent 



1941 (6 months) 



Number Percent 



Less than $2,300 
$2,301 to $3,450-. 
$3,451 to $4,600- _ 
$4,601 to $5,750. _ 
$5,751 to $6,900.. 
$6,901 to $8,050.. 
$8,051 to $11,500. 
Over $11,500 

Total 



66 

520 

1,149 

3,046 

2,786 

396 

260 

72 



.8 
6.3 
13.9 
36.7 
33.6 
4.8 
3.1 
.9 



102 

1,104 

1,943 

3,384 

2,313 

335 

210 

33 



1.1 

11.7 

20.6 

35.9 

24.6 

3.6 

2.2 

.4 



5 

254 

1,607 

1,458 

1,598 

631 

185 

26 



0.1 
4.4 
27.9 
25.3 
27.7 
10.9 
3.2 
.5 



8,295 



100 



9,424 



100 



5,764 



100 



' Building department permit cost estimates increased by 15 percent to arrive at better market value. 
Source: Department of Buildings and Safety Engineering. 

It is also quite obvious that the majority of defense workers who will be attracted 
to the Detroit area will not be in the market for the purchase of a new dwelling. 
By the very nature of the defense emergency, the future is uncertain for them. 
To believe that any great number will be willing to assume the burdens of home 
ownership is highly problematical. 

That private enterprise has made little progress in rehousing the occupants of 
substandard housing is unfortunate, yet not surpiising when an analysis of the 
factors involved is considered. It is a gieat social burden that the very people 
who are most in need of decent housing have little opportunity to obtain it, for 
the simple reason that they cannot afford it. This situation is graphically pre- 
sented by the accompanying diagram where it is shown that the number of vacant 
units available at rentals that tenant families forced to live in substandaid housing 
can afford to pay is inversely proportional to the number of such families. 

PROGRAM OP PUBLIC HOUSING IN DETROIT 

To provide decent shelter for families of low income, the Detroit Housing Com- 
mission is developing a program of public housing within the city limits of Detroit, 
which will provide for 7,317 families when completed. Since this total program 
represents barely 10 percent of the dilapidated and insanitary housing in Detroit, 
only a small beginning will have been made when it is completed. However, with 
the exception of this program, practically no rental housing is being provided in 
the Detroit area for workers of low income. 

After the completion of Detroit's program many tenant families (44,700) will 
remain living in substandard dwellings. It is recognized that many of these 
families are ineligible for public housing because, theoretically, their incomes 
are presumed to be sufficient to enable them to provide decent shelter for them- 
selves, and, therefore, in excess of the maximum limitations for approval for public 
housing projects. On the other hand, many of the owner-occupied substandard 
dwellings, of which there are 16,000 in Detroit, are inhabited by owner families 
who remain in dilajMdated dwellings only because they cannot afford to provide 
better housing for themselves. Moreover, there are many low-income families 
living in satisfactory dwellings who are forced to pay more rent than they can 
afford for the privilege of remaining in these dwellings and escaping the slums. 
It is our opinion that these last two groups are the potential recipients of the econ- 
omic benefits of a comprehensive, low rent public housing program, and that their 
combined numbers more than offset the number of tenant families living in sub- 
standard dwellings whose incomes are above the maximum limits. 

Since the early part of 1938, the Detroit Housing Commission, under the powers 
given it by Federal and local governments, has signed contracts with the United 
States Housing Authority to build a total of seven projects. One of these projects 
is completed and occupied by tenants; two are partially completed and occupied; 
one is under construction; and the rest are in the process of land acquisition and 
planning. In addition, the Brewster and Parkside projects, erected by the Pub- 
lic Works Administration were completed in September 1938, and have been 
occupied since that time. 



NATIONAL DEFENSE MIGRATION 



7245 















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7246 



DETROIT HEARINGS 



A tabulation of the status of the Detroit program as of August 28, 1941, is as 
follows: 

Complete low-rent public horising prograyn in Detroit 



Project 


Kind 


Number 
of dwell- 
ing units 


Type 


Status 


Brewster . 


Public Works Administration . 
do .. .- 


701 

775 
240 

355 

2,150 
440 

210 

1,704 
742 


Slum.... 

Vacant.. 
Slum-.. 

Vacant-. 

...do.... 
...do.-.. 

...do.... 
Slum.... 
..-do--.. 


Project completed Septem- 
ber 1938. 
Do. 


Parkside 


Brewster addition 

Parkside addition 


U. S. Housing Authority 

do 


Project completed Aug. 1, 
1941. 

172 units completed in Janu- 
ary 1941. Balance of 183 to 
be completed about Sept. 
15, 1941. 


Herman Gardens 


do 


Charles 


.... do.-. 


completed about Septem- 
ber 1942. 

192 units completed July 24, 
1941. Balance of 248 to be 
completed about Oct. 1, 
1941. 

Site acquired. Planning 
stage. 

-\cfiuiring site, preliminary 
architectural stage. 
Do. 


Brightmoor 


do 


Jeffries .. 


... do 


Douglass 


do 










7,317 





No discussion of housing conditions in Detroit would be complete without a 
review of the problems facing the Negro population. In the last 20 years the 
Negro populaoion of the city has more than tripled. 

United States census 





Negro popula- 
tion of city of 
Detroit 


Percent of 

total 
population 


1900 


4,111 

5, 741 

40,838 

122, 066 

1 142, 802 


1.4 


1910 


1.2 


1920 - - 


4 


1930 


7.7 


1940 


8.8 







1 Estimated. 

Ever since 1910 the rate of growth in Negro population has been greater than 
the rate of growth of white population. During the decade 1910-20, the World 
War period, the percentage increase was greater than that for any northern city. 
According to the latest United States census figures for 1940, Negroes comprise 
8.8 percent of the city's population. 

A constantly increasing Negro population has resulted in forcing these people 
to live in badly dilapidated housing. The denial of opportunities for natural 
expansion in unsubdivided areas, racial prejudices preventing an expansion into 
areas of satisfactory housing, and general economic conditions, all work against 
the Negro who wislies to better his living conditions. The inevitable result is 
that Negro families are forced to remain living in dilapidated areas so unsafe and 
insanitary that they have for some time Vjeen intolerable for human habitation. 
When, in some few instances, Negro tenants permeate the fringes of white neigh- 
borhoods, the monthly rentals of the dwellings vacated by whites are immediately 
increased. This is the sort of situation that faces the Negro defense worker when 
he migrates into Detroit. 

The real property inventory of 1938 revealed some startling factors about tlie 
living conditions in which Negroes find themselves compelled to live. Of the 
dwellings occupied by Negroes, more v.-ere found to be unsafe, insanitary, or over- 
crowded than in a satisfactory condition; 50.2 percent of all dwellings occupied 



NATIONAL DEFENSE MIGRATION 



7247 



by Negroes were found to be substandard; only 14 percent of the dwellings occu- 
pied by whites were found to be substandard. Quite a contrast. 





Occupied by white 
families 


Occupied by Xegro 
families 




Number 


Percent 


Number 


Percent 




311,485 
52, 134 


86 
14 


14, 770 
14, 897 


49.8 




50.2 






Total - -- - - 


363, 619 


100 


29, 667 


100.0 







The Detroit Housing Commission is particularly aware of the desperate need for 
better housing among Negro families. Up to May 1, 1941, approximately 9,200 
applications and registrations for apartments in housing projects had been re- 
ceived from Negro families. It is estimated that about 6,300 of these are eligible 
for admission. However, only 1,785 of these families will have been housed in 
projects now completed, under construction and planned for the near future. 
Thus an estimated balance of about 4,515 eligible families remain for whom there 
is no future or present provision in our program. A recapitulation follows: 

Application status for Negro projects, Detroit Housing Commission 

Approximate number of applications and registrations filed up to 

May 1, 1941 9,200 

Total number of eligible families 6, 300 

Selected for original Brewster .- 701 

Families housed in Brewster addition 240 

Turnover in Brewster project 102 

Families to be housed in Douglass _ 742 

Total families to be housed 1, 785 

Estimated balance of eligible families which need housing 4, 515 

In addition to the Detroit Housing Commission's program, the United States 
Housing Authority will very soon begin construction of a 200-unit defense-housing 
project for Negro defense workers. This is the only defense-housing project that 
has been allotted to the city of Detroit by the Defense Housing Coordinator's 
office at this writing. 

A 500-unit project for white families was proposed some time ago to be erected 
within the city limits. However, shortly after its announcement, Federal officials 
decided to erect this project in the city of Centerline in Macomb County rather 
than in Detroit. A construction contract for this project has recently been 
awarded. The onlv other defense project planned for the Detroit area at this 
time is a 300-unit project to be erected in Wayne, Mich. Thus the entire Detroit 
defense area, faced with the prospect of housing thousands of defense migrant 
workers, is allotted a mere pittance in defense-housing rental units — 1,000 dwelling 
units. 4 

In conclusion, it is well to point out that, if automobile production curtailment 
is enforced so drastically that the influx of defense workers to Detroit will be 
negligible, the present acute housing shortage may not be accentuated. However, 
to summarize, there are certain factors prevalent today that cannot be denied. 
They are: 

1.' An existing acute shortage of available vacant dwellings, especially in the 
lower rental brackets, in spite of considerable residential building activity. 

2. A large number of unsafe, insanitary and overcrowded dwellings occupied 
mainly by low-income families. 

The two factors enumerated above are applicable to both whites and Negroes, 
but they are particularly ap]3lica):>le to Negro families. 

What Detroit needs, if it is to meet an invasion of defense workers, is many new 
homes — mainly homes built for rental purposes. Unless we solve this problem, 
Detroit's inability to house its defense workers may seriously hamper the defense 
■effort of the mass production capital of the Nation. 



60396—41 — pt. IS- 



-13 



7248 DETROIT HEARINGS 

Exhibit A. — Brief Description of Detroit Public Housing Projects 

report by george edwards, director-secretary, detroit housing 

commission 
Brewster and Parkside projects. 

These two projects were built by the former housing division of the Public 
Works Administration and subsequently leased by the United States Housing 
Authority to the Detroit Housing Commission for operation. Brewster 
Homes was built on a slum site, which along with the surrounding neighborhood 
areas to the north, east, and south, was considered the worst slum area in the 
city. The relocation of 718 families was made necessary by the construction of 
this project. Parkside Homes was a vacant land project, located near the eastern 
limits of the city. 

Tenants have been living in these two projects since September 1938, when they 
were completed. A complete alteration of family living among the tenants of 
these projects has taken place. Many of the homes from which they moved 
were miserable, damp, unhealthful quarters in which disease, ill-health and 
demoralization were bred, and where the conduct of decent American standards 
of living was impossible. One can only guess at the transformation made possible 
by admission to homes flooded with light and sunshine, abundant recreation 
facilities, and the possibility of community living, until he has actually witnessed 
the change hiimself. 

Recreational facilities are abundant at both projects. At Brewster, the close 
proximity of the recreation center provides a gymnasium, auditorium, swimming 
pool, showers, and club rooms. Chandler Park, adjacent to Parkside provides 
excellent recreational facilities. 

A fine community spirit among the families has been in evidence. Each project 
supports a project newspaper. There are hobby clubs, classes in various subjects 
and many social activities. At Brewster many tenants are taking a keen interest 
in working in the flower gardens and caring for the lawns. At Parkside, there is 
an annual contest for best-kept flower gardens and best-kept lawns. The manage- 
ment is especially proud of these results. Nothing so dramatically reflects the 
contrast between Parkside and the slums as the beautiful lawns, creeping vines, 
and colorful flower beds. 

Extensions to both projects have recently been partially completed. These 
extensions are United States Housing Administration-aided projects. 

Charles, Herman Gardens, Brightmoor. 

With the beginning of 1938 when the first United States Housing Authority 
funds became available, the Detroit Housing Commission found itself face to 
face with a perplexing problem. Should it begin its building program by rebuild- 
ing large areas of the slums with low-rent projects, thereby making the housing 
shortage more acute during the period of construction ; or should the commission 
begin its program by erecting large projects on vacant land? One of the con- 
tributing factors to the acute shortage was found to be overcrowding in the slums. 
It was decided, therefore, to build the initial projects on vacant land, and after 
the completion of these projects to begin the rebuilding of the slums. This 
policy would permit a gradual transference of families from dilapidated dwellings 
in the slums to the outlying new projects, which would tend to lessen the pressure 
of the housing shortage. 

The three projects, Charles, Herman Gardens, and Brightmoor, along with the 
extension to Parkside, are projects that are under construction on vacant land sites. 
The Charles project will shortly be ready for occupancy. Construction on 
Herman Gardens was unfortunately interrupted a few months ago when the 
corporation counsel ruled that the general contract was void due to irregularities 
on the part of members of the common council in the awarding of the contract. 
Construction was halted at a time when footings and foundation walls were 
well in place. It is hoped that within a few weeks' time a new general contract 
will be awarded enabling construction work on the 2,150-unit project to be renewed. 
The Brightmoor project is the smaflest of the lot and is in preliminary stages of 
development. 

In the projects erected on vacant land, due to the lower cost of the property, 
it has been possible to plan for more open space, recreational and play area than 
in other projects. This is especially true in the Herman Gardens project where 
there is generous play space, tennis courts, ball field, spray pools, and open park. 
This project, when completed, will be the largest in area of any in the United 
States, although not in number of families. The residential buildings will be row 
houses and row flats. The structures will all be two stories in height with the 



NATIONAL DEFENSE MIGRATION 724^^ 

exception of a few Avhich have three-story ends for architectural variety and 
interest. Approximately 75 percent of the buildings will have pitched roofs, the 
balance flat roofs. Utility rooms with individual laundry and storage facilities 
have been included in all units. 

The Charles project, although not nearly so large as the Herman Gardens 
project, nevertheless offered unusual opportunities in planning. A large open 
park and recreational space is located in the center of the site. The entire project 
has been so designed that it is possible to walk to this recreational area from 
any building on the site without the necessity of crossing an automobile lane — not 
even a service drive. Thus, the best features of the garden city or "Radburn" 
type of plan are attained without the disadvantages of using underpasses. 

Jeffries and Douglass. 

These two projects are large slum clearance developments. At the present time 
condemnation proceedings are in process for the purpose of acquiring the sites. 

The Jeffries project, to house 1,700 families, will clear a slum area containing an 
incoherent street and alley pattern, with small, narrow congested streets. The 
opportunity to eliminate this maze of congestion with the establishment of a 
superblock system is very attractive. The result of the replanning will be to 
establish 4 large superblocks where formerly 35 small blocks existed. 

The site of the Douglass project, to house 706 units, lies adjacent to and 
directly south of the present Brewster Homes and extension. As now planned it 
will occupy 9 square blocks. In the planning of the project, it is proposed tO' 
arrange the units in such a way that common entrance hallways and stairways are 
entirely eliminated. This is accomplished by limiting the type of buildings to> 
2-story flats and to a 3-story combination of flats and row houses. 

Defense projects. 

Recently the United States Housing Administration requested the Detroit 
Housing Commission to act as its local agent in the development, construction 
and operation of two defense housing projects to be erected within the Detroit city 
limits. Sites for these projects, on vacant land near the city's outskirts, have 
tentatively been chosen. The sites are well located in relation to the defense- 
plants. One of the projects is to house 200 Negro families and the other from 300 
to 500 white families. It is proposed to provide one- and two-story and two- and 
four-family dwellings to be built of frame construction without basements and 
with individual heating systems. 



TESTIMONY OF GEORGE EDWARDS— Resumed 

Mr. Curtis. Will you briefly describe the functions and program of 
the Detroit Housing Commission? 

FUNCTIONS AND PROGRAM OF DETROIT HOUSING COMMISSION 

Mr. Edwards. Under the State act, the Detroit Housing Commis- 
sion has jurisdiction over attempts to solve almost any of the housing 
problems that may arise in this city. In addition, the commission i» 
engaged in the low-rent public housing program as the local cooperat- 
ing agent working with the United States Housing Authority. 

Mr. Curtis. Does it allocate the funds? 

ALLOCATION OF HOUSING FUNDS 

Mr. Edwards. The United States Housing Authority has allocated' 
$31,000,000 worth of funds to the Detroit Housing Commission. 

Mr. Curtis. Then you in turn allocate it to various projects in 
your Detroit area? 

Mr. Edwards. Yes; and we build those projects through letting- 
of private construction contracts. We are also agents for the United 
States Housing Authority on the construction of one small defense- 
housins: Droiect in this area. 



7250 DETROIT HEARINGS 

Mr. Curtis. In your paper you make the statement that houses for 
rent are ahnost nonexistent. Will you discuss that situation? 

DETROIT HOUSING VACANCY PERCENTAGES 

Mr. Edwards. Since 1938 there has been a progressive decline in 
vacancies in the city of Detroit. That is shown by the fact that in 
1938 approximately 5.6 percent of the houses in the city of Detroit 
were vacant. That was reduced at the time of the 1940 census to 
slightly over 3 percent, and this year to 2.2 percent, according to a 
W. P. A. survey last winter. 

Quite recently the homes registration office of the Detroit Housing 
Commission, which has been established at the suggestion of the 
National Government, took a survey and found that of the total of 
some 450,000 dwelling units in the city of Detroit, only 4,050 were 
vacant. That is nine hundredths of 1 percent of vacancies for the 
entire city of Detroit. It is my opinion there is a definite housing 
shortage in the city of Detroit and a serious one at this time. In 
housing and real estate circles I think it is accepted when 3^ou drop 
below a 5 percent vacancy, you have a housing shortage, because 
there always is a necessity for some dwelling units to be vacant in a 
city as large as Detroit in order that there can be some mobility in 
the housing population. 

Mr. Curtis. The usual turn-over? 

HOUSING SHORTAGES 

Mr. Edwards. That is correct. As things stand in the city right 
now, it is becoming increasingly difficult for families to find any 
dwelling facilities whatsoever below the rental of, I would say, $45 
to $50 a month. 

Mr. Curtis. Do you have a doubling-up problem here? 

Mr. Edwards. The only illustration that I can give you of that, in 
statistical terms, is given by this count that the W. P. A. took 
recently of some 16,000 migrant families who have come to Detroit. 
I believe it was found that only one-third of the families that had 
come to Detroit within a period of about the last year had managed 
to find accommodations separate from other families. That is, two- 
thirds of them were either living doubled up or in trailers or hotels. 

Mr. Curtis. Aligrant families living in hotels? 

IMr. Edwards. Yes; I believe 8 percent of the migrant families were 
living in rooming houses or hotels. 

Mr. Curtis. The common council here has had a rent investigation 
committee, has it not? 

Mr. Edwards. Yes. 

Mr. Curtis. What work have they been able to do and with what 
success? 

RENT MEDIATION 

Mr. Edwards. They have attempted to stem unjustified rent 
increases and they have attempted to deal with the problem of 
unfair rents and also with substandard housing. 

I lK>liove that by thro\\Tng the spotlight of public opinion on some 
of these conditions, thev have had some real influence in that regard. 



NATIONAL DEFENSE MIGRATION 7251 

They have recently estabhshed a rent mediation committee, to 
which landlords and tenants can come if they are agreeable to submit 
their problem for voluntary mediation. Those committees have been 
successful in some instances and they have been completely unsuc- 
cessful in other instances because of the refusal of one party or the 
other to cooperate. 

I believe that that committee has brought out the fact that among 
the lower group of rentals in the city of Detroit, rent increases are 
quite common and quite substantial, and that there is danger of a 
spiral of rent increases which would be dangerous to the whole indus- 
trial picture here. 

Mr. Curtis. Wliat do you mean, in your paper, by the phrase, 
"emergency shelter"? You say, "There is a need for providing 
emergency shelters." 

EMERGENCY SHELTER 

Mr. Edwards. The housing shortage has put much pressure on 
the families at the bottom of the economic heap. Welfare families 
are being evicted, and the Detroit Welfare Department has been 
forced to use several additional emergency welfare shelters to take 
evicted families — just dormitory-like structures. They keep them 
there until they find some other place to house them. 

I think at the present time they are having a great deal of difficulty 
in finding any accommodations for a good many of their weKare 
families. Today a family with children — ^and I thinly most American 
families have children — who cannot pay more than $45 a month would 
be pretty well stranded, so far as finding a place to live in the city of 
Detroit is concerned. 

The reason I know that is because we are operatmg the homes 
registration office, and day by day we have families coming in and 
saying, "Here, house us." And we are having real trouble in meeting 
their requests. 

HOUSING SURVEYS 

Mr. Curtis. A real property survey has been made, has it not? 

Mr. Edwards. Yes; in 1938. 

Mr. Curtis. Who made that? 

Mr. Edwards. The W. P. A. 

Mr. Curtis. Is that the one you referred to in your discussion of 
"doubling up," a moment ago? 

Mr. Edwards. No; that is a different survey. This was made in 
1938. It was sponsored by the Housing Commission and made by 
the W. P. A. The other W. P. A. survey that I referred to was a 
study of migrant workers, made just within the last few months. 

Mr. Curtis. What were some of the significant facts this real- 
property survey revealed? 

substandard housing in the DETROIT AREA 

Mr. Edwards. Among others, that 70,000 of the total number of 
houses in the city of Detroit were ascertained to be substandard in 
character at that time. Of these I think only 3,500 were found to be 
vacant. In other words, there were, roughly, 67,000 families living in 
substandard housing. 



7252 DETROIT HEARINGS 

In addition to that, the real-property survey showed that there were 
52,000 tenant famihes hving in substandard housing. I beheve 76 
percent of these 52,000 tenant famihes were earning incomes at that 
time of less than $1,400 a year. 

Mr. Curtis. Do you feel that the housing problem of Detroit is an 
•especially new problem, because of the defense activities, or a chronic 
situation that has been here for years but is being felt more because 
of the defense impact? 

Mr. Edwards. I think that Detroit has had a housing problem to 
•start with. I think it has become progressively more acute during the 
last years. 

I think, in addition, that if, in the last analysis, there proves to be 
•any in-migration of workers at all into the Detroit area, we will have 
trouble housing them unless a defense housing program is started here 
immediately on a considerable scale. 

Mr. Curtis. Well, is private enterprise building any housing? 

PRIVATE HOUSING CONSTRUCTION 

Mr. Edwards. Private enterprise is building a good many houses. 
Private enterprise built, I believe, 10,000 houses in 1940 and up to 
<date in this year I think our figures show about 8,000. 

Mr. Curtis. That is, 18,000 family units since Januaiy 1, 1940? 

Mr. Edwards. Yes; that is correct. 

Mr. Curtis. And how many have your public housing projects 
l)uilt? 

PUBLIC HOUSING CONSTRUCTION 

Mr. Edwards. Our public housing programs include about 1,000 
houses actually constructed within the last year, and 2,300 under 
construction. That mcludes the 200-unit defense housing project 
on which a contract has been let. 

Mr. Curtis. Then you have between 3,000 and 4,000 built by 
housing projects and about 18,000 built by private enterprise? 

Mr. Edwards. Yes. 

Mr. Curtis. Have any of these 18,000 units built by private enter- 
prise been built for the purpose of renting? 

Mr. Edwards. A very small percentage. I can give you those 
figures. 

Mr. Curtis. But it does affect the whole picture because some 
people who are now tenants become owners in the new houses? 

Mr. Edwards. Every house built relieves the shortage, but I would 
like to point out to j^ou that these houses have been built on a con- 
siderable scale for the last several years, and at the same time we still 
have this vacancy picture which I mentioned to you earlier. That 
vacancy count included new houses, vacant and available wherever 
they were to be located in the city of Detroit. 

Mr. Curtis. Are the defense workers in the market to purchase 
a house? 

Mr. Edwards. I would not think so. Migrants particularly 
would not seem to be in the market for houses. 

Mr. Curtis. Their presence is recognized as more or less a tem- 
porary phenomenon, isn't it? 



NATIONAL DEFENSE MIGRATION 7253 

Mr. Edwards. It would seem to me that in-migration would 
necessarily imply temporary employment. 

Mr. Arnold. We had a migrant witness this morning who just 
recently moved to Muskegon, and he is purchasing his o^vn house. 

The Chairman. Yes; that is right. 

Mr. Edwards. I don't doubt that for a minute. I think a good 
many of them will be forced to purchase houses whether they should 
or not, because they may not be able to get anything else. 

EXPLOITATION OF NEGROES 

Mr. Edwards. At the present time there are approximately zero 
vacancies in the Negro neighborhoods. There is more doubling up, 
and I think there is more exploitation in Negro neighborhoods than 
any place else in the city of Detroit. 

Mr. Curtis. Are your other areas in Detroit covered by what they 
call covenants in the title of land, barring occupancy by Negroes? 

Mr. Edwards. Yes; an overwhelming majority of the districts in 
the city of Detroit are restricted by one method or another against 
Negro occupancy. 

Mr. Curtis. Are the Negroes paying higher rents for what they 
get than the white people? 

Mr. Edwards. Yes — without any equivocation. 

Mr. Curtis. How much higher? Could you give an illustration? 

Mr. Edwards. It is very hard to say. I know of apartment build- 
ings purchased for the purpose of rental to Negro tenants. The white 
families have been moved out, and Negro tenants moved in, and rents 
were raised as much as $10 and $15 on an apartment. 

Mr. Curtis. Is that justified on the basis that the percentage of 
losses to the owner is greater? 

INCREASED RENTS FOR NEGRO OCCUPANCY NOT JUSTIFIED 

Mr. Edwards. I think you come there to a matter of opinion, be- 
cause I cannot say that we have any accurate figures in relation to 
private rental to Negro families, comparing m.anagement costs. I 
can say we manage two projects of approximately the same size. 
One is rented entirely to white people and one is rented entirely to 
colored; and we have no difference in management expenses to speak 
of, as far as those projects are concerned. We simply don't find that 
a greater rent would be justified by management and expense. 

Mr. Curtis. Wlien new houses are built, and people move into 
them, are the places these people are leaving becoming available for 
defense workers, or are they being filled by people who heretofore were 
doublmg up? . 

Mr. Edwards. I don't thmk there is any doubt that part of the 
vacancy picture is that some of the families that doubled up during 
the depression or the 1938 "recession," as they call it, are now separat- 
ing and findhig vacant dwellmg units wherever they can. 

However, I would say, to return to my original statement, that if 
there are defense workers coming into this area in any number at all, 
they will have an exceedingly hard time finding housing unless defense 
housing programs are started. 



7254 DETROIT HFyAKINGS 

Mr. Curtis. The people living iii your U. S. H. A. houses are sup- 
posed to have incomes not to exceed a certain figure? 

Mr. Edwards. That is true. 

Mr. Curtis. Are you presented with any demands to permit them 
to stay on even though their income exceeds that, on the ground that 
they can't get another house? 

Mr. Edwards. Yes, sir; we have had that problem quite recently, 

Mr. Curtis. And what have you done about it? 

Mr. Edwards. The commission recommended disposition of the 
matter to the United States Housing Authority. Final decision has 
not yet been made by them. 

\^e found 150 families in the Brewster project, which is the Negro 
project, over our maximum income, and 50 families at the Parkside 
project over our maximum income. 

lifting of income limit urged 

Only in a minority in each project were these families over the 
maximimi allowed by the United States Housing Authority in certain 
other cities. As a result of that, the Detroit Housing Commission has 
reconmiended to the United States Housing Authority that our 
maximum figures be increased by 20 percent; that the families who 
fall within that 20 percent increase be allowed to stay for a period of 
1 year on condition that they pay 25 percent more rent in order to 
reduce the subsidy on the dwelling unit which they are occupying. 

We felt that it would be impossible to evict 150 families from the 
Brewster project because we didn't think there was any possibility 
of housing them under the present circumstances or finding housing 
for them at reasonable rentals. 

Mr. Curtis. But they are in a better position to undertake the 
problem for themselves than those with smaller incomes, aren't they? 

Mr. Edwards. No question about that. If it were not for what I 
consider to be a very serious housing shortage, these families, I 
believe, should be asked to move and should be asked to find private 
rentals for themselves. 

I think it is illogical to take families from slums and move them 
back into slum conditions at the end of their period of occupancy of 
public housing projects, and as a result we have tried to mitigate that 
evil to the extent that I have mentioned. 

Mr. Curtis. But the public expenditure is made, however, to 
take care of individuals in slums who have very little or no income. 

Mr. Edwards. That is correct. So far as the United States 
Housing Authority's definition of "low-income families" is concerned, 
the 200 families about which we are speaking are still within that 
definition. 

The Detroit Housing Commission has set its standards of income 
lower than the United States Housing Authority would have other- 
wise allowed. 

Mr. Curtis. In other words there is a variance in different localities 
in the United States? 

Mr. Edwards. That is correct. 

Mr. Curtis. Based upon rent conditions. 

Mr. Edwards. That is correct. 



NATIONAL DEFENSE MIGRATION 7255 

Mr. CuETis. In your paper you say: "What Detroit needs is many 
newiy built homes for rental purposes." Is it your opinion that the 
recent priorities order limiting houses to $6,000 for home construction 
will supply the need? 

RENTAL HOUSING NEEDED 

Mr. Edwards. No, sir; I do not think so. I think those homes will 
be built for people who know that they want to buy a house. I 
think that if there is an in-migration of defense workers, their problem 
will be rental housing, and I see no possibility of their securing ade- 
quate rental housing through the mere granting of priorities to private 
housing construction in this area, which private housing construction 
in most instances is going to be for sale. 

Air. Curtis. But that will affect the entire picture, will it not? 

Mr. Edwards. It will affect the entire picture from the viewpoint 
of people who are ready to buy a house, but the defense workers are 
not going to be the people who buy the houses, in my opinion. And 
as a result, in judging the housing picture where there already is a 
housing shortage, you are depending on a factor for the solution of a 
housing shortage which does not relate to the problem itself. That is, 
you are depending upon the desire of individuals now employed in the 
city of Detroit to own a house, to produce a sufhcient number of 
additional dwelling units to relieve the housing shortage, and I don't 
think that is a safe assumption. 

Mr. Curtis. Do you have any positive indication that you are 
going to have a big influx of workers in Detroit? 

Mr. Edwards. No, sir. I think the picture which undoubtedly 
has been given you up to date, relating to the effect of the defense 
program here, has probably been given by people more competent to 
analyze it than I am. I have heard a great deal about it. I have 
studied it, but I have to rely on a ^ood many of the same people who 
have testified here, and the only thing that I can say is that it is my 
information from those people whom I have talked with in the Office 
of Production Management, that the inachme tools of Detroit and 
the manpower of Detroit eventually are going to be used to the 
maximum. Now, whether that is 6 months from now or a year from 
now, I believe that if they are going to be used to a maximum, we had 
better start working on the housing problem now, because you can't 
solve a housing problem at the time the housing shortage exists. 

Mr. Curtis. Of course, those with special skills brought into Detroit 
will have to be taken care of. 

Mr. Edwards. Yes. 

Mr. Curtis. What has been the average cost of those housing units 
you have built so far? 

AVERAGE COST OF HOUSING UNITS 

Mr. Edwards. The last project that we built cost $3,600 a dwelling 
unit, net construction cost. 
Mr. Curtis. Per family unit? 
Mr. Edwards. Yes; per family unit. 
Mr. Curtis. Is that white or colored? 
Mr. Edwards. That is a white project. 
Mr. Curtis. Has that been the average? 



7256 DETROIT HEARINGS 

Mr. Edavards. No. Some have been less and some have been 
more. The one immediately previous to that cost $3,280. In other 
words, there was an increase of close to $400 per dwelling between 
those two projects. 

Mr. Curtis. What is your maximum? 

Mr. Edwards. Our maximum, I believe, would be $5,000 in a city 
of this size. 

Mr. Curtis. You have built some that cost $5,000? 

Mr. Edwards. I believe about $4,000 is the top figure at which we 
have built. 

Mr. Curtis. Now, what does a family unit consist of? 

Mr. Edwards. Of all the facilities that are necessary. 

Mr. Curtis. How many rooms? 

Mr. Edwards. About four and a half rooms is the average. 

Mr. Curtis. What will be the effect of the out-migration of Detroit 
workers on the housing situation? 

Mr. Edwards. It would tend to relieve the existing housing short- 
age, if there is such an out-migration, and to that extent would 
mitigate the problem which we now have. 

PROBLEM OF HOUSING FOR PARENTS WITH CHILDREN 

The Chairman. Mr. Edwards, in our travels thi'oughout the country 
we found, from the testimony of various migrant witnesses, that it is 
very difficult for parents with large families of five or six children to 
get any housing at all. Do you find that problem in the Detroit area? 

Mr. Edwards. I would say that the worst housing problem in the 
city of Detroit is for Negroes with children, and the next, for white 
families with children. And in this regard I am referring to industrial 
workers' families whose income presumably would not allow for paying 
rentals going above the $50 mark. 

The Chairman. You said four and a half rooms is the average size 
dwelling unit. Wliat rooms are provided in such houses — kitchen 
and what else? 

Mr. Edwards. We don't have dining rooms. The average unit 
would include a living room, a kitchen, and two and a half bedrooms. 

The Chairman. Have you any defense housing projects in the 
Detroit area? 

defense housing projects in DETROIT AREA 

Mr. Edwards. We have 3 in the Detroit area. There is 1 
inside of the city of Detroit, and there is a 500-unit defense project 
being built in southern Macomb County, at Centerline, and a 
300-unit project being built at Wayne. That is just in the north- 
west industrial area. 

The Chairman. Will they be four-and-a-half-room units? 

Mr. Edwards. I don't have charge of those two projects and I 
don't know the details, but I think all of these defense housing projects 
are being built with a room ratio that is above the previous U. S. H. A. 
and P. W. A. housing standards, and I think that our experience bears 
out the desire to build them in larger ratios. 

The Chairman. I might say, Mr. Edwards, that we are not here to 
criticize the Detroit set-up, because we are from the Capital of the 



NATIONAL DEFENSE MIGRATION 7257 

Nation, and things are not so good there. We had a witness before 
our committee there who testified that there were 6,000 homes there 
with outside privies, not connected with sewers; so we are in no posi- 
tion to say anything about the rest of the country. 

Mr. Edwards. Yes; I know Washington has its problems. 

The Chairman. We asked a migrant witness out in Los Angeles 
where he and his wife and six children slept. He said, "In a 10 by 14 
tent. " I said, "I suppose you have the very latest sanitary con- 
veniences?" He said, "No, Congressman, we have the earliest." 

Before adjourning I want to say that Congressman Fred Crawford, 
of Saginaw, has sat with our committee during the afternoon session. 
His suggestions have been helpful, and we were glad to have him 
with us. 

If there is noth'ng further, the committee will stand adjourned 
until 9:30 tomorrow morning. 

(Whereupon, at 4:30 p. m., the committee adjourned until 9:30 
a. m., Thursday, September 25, 1941.) 



NATIONAL DEFENSE MIGKATION 



WEDNESDAY, SEPTEMBER 24, 1941 

House of Representatives, 
Select Committee Investigating 

National Defense Migration, 

Washington, D. C. 

MORNING SESSION 

The committee met at 9:30 a. m., in the Federal Building, Detroit, 
Mich., pursuant to notice, Hon. John H. Tolan (chairman) presiding. 

Present were: Representatives John H. Tolan (chairman), of 
California; Laurence F. Arnold, of Illinois; Frank C. Osmers, Jr., of 
New Jersey; and Carl T. Curtis, of Nebraska. 

Also present: Dr. Robert K. Lamb, staff director; John W. Abbott, 
chief field investigator; Francis X. Riley and Jack B. Burke, field 
investigators; and Ruth B. Abrams, field secretary. 

The Chairman. The committee will please come to order. 

Mr. Thomas, you and your associates will be the first witnesses, 

TESTIMONY OF R. J. THOMAS, INTERNATIONAL PRESIDENT, 
UNITED AUTOMOBILE, AIRCRAFT AND AGRICULTURAL IM- 
PLEMENT WORKERS OF AMERICA, AFFILIATED WITH THE 
CONGRESS OF INDUSTRIAL ORGANIZATIONS; JAMES WIS- 
HART, RESEARCH DEPARTMENT, U. A. W.-C. I. 0.; GEORGE 
ADDES, INTERNATIONAL SECRETARY-TREASURER, U. A. W.- 
C. I. 0.; VICTOR REUTHER, ASSISTANT TO MR. ADDES; RICHARD 
DEVERALL, EDUCATIONAL DEPARTMENT, U. A. W.-C. I. 0. ; 
AND RICHARD REISINGER, INTERNATIONAL BOARD MEMBER, 
U. A. W.-C. I. 0. 

The Chairman. Gentlemen, Congressman Osmers will inteiTOgate 
you. 

Mr. Osmers. Mr. Thomas, will you give your name and your title 
to the reporter, for the record? 

Mr. Thomas. R. J. Thomas, international president. United 
Automobile, Aircraft, and Agricultural Implement Workers of 
America, affiliated with the Congress of Industrial Organizations. 

Mr. Osmers. Now, would you care to present the other men who 
are with you? 

Mr. Thomas. I have with me as consultants, Mr. Wishart, who is 
in charge of our research department, Mr. George Addes, who is 
international secretary-treasurer, and who has been placed in charge 
of our department on priorities unemployment; Mr. Victor Reuther, 
who will be Mr. Addes' assistant; Richard Deverall, in charge of our 

7259 



7260 



DETROIT HEARINGS 



educational department; and Mr. Reisinger, international board 
member, and also assigned to priorities unemployment. 

Mr. OsMERS. Mr. Thomas, in going over your prepared statement 
with respect to the automobile industry, I notice several observations 
that are at complete variance with the generally accepted notions as 
to the position of the automobile industry with respect to defense, so 
as we go along, I am going to quote to you certain portions of your 
own statement, and then you can enlarge upon them and thereby we 
will have a full presentation of your views. The statement will be 
incorporated as a part of the record. 

(The statement referred to above is as follows:) 



STATEMENT BY R. J. THOMAS, IXTERXATIOXAL PRESIDENT, 
UNITED AUTOMOBILE, AIRCRAFT AND AGRICULTURAL IMPLE- 
MENT WORKERS, AFFILIATED WITH THE CONGRESS OF IN- 
DUSTRIAL ORGANIZATIONS 

The impact of curtailment in the interest of national defense has not yet been 
felt in the automobile industry. 

It is true that the Office of Production Management has already announced 
reduced quotas for passenger-car production for the 12-month period beginning 
August 1, 194L Total passenger-car production in those 12 months will be 
50 percent under production in the 12-month 1940-41 model year. No more than 
2,148,300 cars will be produced as compared with the 4,223,732 cars which came 
oflf automotive assembly lines in the previous year. 

But this slash in production has not yet been realized. From the 1st of August 
this year up to September 20 a total of 319,720 motor vehicles have been produced 
as compared with pioduction of 272,673 for the same weeks of 1940. 

Instead of the 26 percent cut in operations ordered by Office of Production 
Management beginning with August 1 we have been experiencing a 17 percent 
increase in production. Only in the last 2 weeks has production been checked. 

The following table will indicate total vehicle production on a week-to-week 
basis: 

Motor vehicle production, Aug. 1 to Sept. 20 



1941 



August 1-31 . . 
September 6, 
September 13 
September 20 

Total.. 



173,000 
32, 940 
53, 165 
60, 615 



89,866 
39, 665 
63,240 
79, 902 



319, 720 



272, 673 



The auto production has proceeded at this speed is a matter of some concern 
to the membership of my organization. For it indicates that the major pro- 
ducers have turned their full energies toward securing the highest possible levels 
of production in the first few weeks of the present-model year. 

The United Automobile Workers fears that this all-out production of cars in the 
last few weeks may be opening the way for a slump in production and employ- 
ment before the 48.4 production cut announced for December 1 can take effect. 

In the present uncertain situation, therefore, it will be impossible to present to 
the members of the Tolan committee any reports of the full impact of production 
curtailment in the automobile industry. 

I can only suggest some of the probable effects of curtailment in the auto in- 
dustry. I can only estimate conditions which will exist throughout our industry 
within the next few months. 

Before dealing with this question it is well to point out that in spite of the com- 
paratively high level of production throughout the auto industry, displacement of 
workers has already taken place in certain areas of the Union. In Buffalo, for 
instance, 3,600 of our members foiuid themselves without emi'loyment over a 
month ago when the General Motors Corporation shut down its plants in that 
city for conversion to defense production. 



NATIONAL DEFENSE MIGRATION 7261 

Earnest efforts on the part of Office of Production Management secured employ- 
ment for some 1,400 out of this number in the booming defense plants of Buffalo. 
The remainder, including about 400 now enrolled in defense training courses, are 
now subsisting on unemployment compensation. 

In a number of auto-parts plants, including the giant Briggs body plant where 
lay-offs will shortly amount to about 4,000, future curtailment in final assemblies 
has already taken its toll of employment. No conclusive data on this situation 
is yet available on an industry-wide basis. 

PRIORITY UNEMPLOYMENT 

Beginning with December 1, 1941, the automobile industry will be allowed to 
produce only one passenger car for every two produced last year. Beginning with 
March of 1942 production quotas are to be reduced even below this level. 

It should be understood that in establishing quotas for the automobile industry 
the Office of Production Management makes no guarantee that materials will be 
available for their complete fulfillment. No priority or preference rating is avail- 
able for critical materials going into the production of automobiles. In the auto 
industry such ratings are reserved for the production of heavy trucks and repair 
parts. 

In view of the shortages now existing in supplies of essential metals, it is alto- 
gether likely that by the first of next year production quotas announced by the 
Office of Production Management will become impossible of accomplishment 
by the automobile industry. 

On the face of it this situation constitutes a grave problem to the men and 
women whose livelihood depends upon employment in the auto industry of Detroit 
and Michigan. It is certainly a matter affecting profoundly the interstate move- 
ment of workers. 

How many workers are to be displaced by curtailment throughout the auto 
industry? 

The best answer to this question can be suggested by comparing last year's 
employment with employment during the year of 1938. In that year the auto 
industry produced about 50 percent of last year's motor vehicle output. And in 
1938 an average of 305,000 workers found employment in the auto industry. Dur- 
ing winter and spring of 1941 employment in the auto industrv has averaged 
about 520,000. 

These figures would indicate, then, that about 215,000 auto workers will be 
seeking new em])loyment of some kind bj' the middle of December 1941. 

It is true that a part of this 215,000 will be able to secure employment in expand- 
ing defense industry. But defense employment will be sufficient to absorb only 
a fraction of this nimiber within the near future. Between June and December 
of this year not much more than 60,000 defense jobs will have been added to the 
auto industry. 

Assuming that every defense job went to a displaced auto worker, by January 
1, 1942, at least 150,000 automobile workers would be still dependent on unemploy- 
ment compensation, Work Projects Administration assistance, or relief. 

For the State of Michigan alone at least 80,000 auto workers are threatened 
with unemployment through the winter. 

The effect of this situation would appear to be little short of catastrophic for 
the communities affected. Unemployment for 150,000 auto workers will mean a 
decline of $6,240,000 per week in the purchasing power of labor throughout the 
county. 1 

In Detroit it appears that net unemployment will be increased by 50,000 by 
January 1942. In communities such as Flint, Mich., the problem may well assume 
the proportions of a major crisis. Out of a total industrial employment of 
50,000 in Flint as of May 1941, at least 20,000 are threatened by lay-offs within 
the ne.xt 3 months. 

Only one plant in Flint is now working on Government contracts; and defense 
work now contracted for will not be sufficient to emplo}- a majority of its present 
automotive workers. 

Of course Flint's problem would be well on the way to a successful conclusion 
had not the General Motors Corporation given up its plans for locating there an 
aircraft engine plant which could have employed at least 10,000. On the claim 
that "Flint's labor supply was inadequate" this aircraft engine plant is now 
swinging into production in Melrose Park, 111.^ 

' Bureau of Labor Statistics average weekly earnings for auto workers in May 1941 ($41.64) times total 
unemployment. 

2 A similar mystery in plant location is the choice of Ypsilanti for Ford's giant bomber plant. This 
community lacks all facilities for the 30,000 or more workers to be employed. These workers will pay the 
price for this in a 30-mile drive to and from work over intolerably crowded highways. 



7262 DETROIT HEARINGS 

Saginaw, Lansing, Pontiac, and other centers of auto production in Michigan 
are likewise threatened by the curtaihiient of automobile production— though in 
those cities the impact will be less crushing than in Flint or Detroit. 

How soon will defense production call for the labor of these men whose jobs 
are threatened by material shortages and curtailment? 

All the information we have been able to secure indicates that the auto industry 
at its present pace is creating about 10,000 defense jobs per month. Unless this 
pace is considerably increased — and I am confident such increase is possible — 
net unemployment will not be materially reduced until the summer of 1942. 
Defense jobs coming into the industry up to July 1942, will be barely sufficient 
to absorb additional unemployment created by cuts well under the 50-percent 
level anticipated for next spring. 

I do not know how much at variance these conclusions may be with those 
presented to this committee by representatives of the automobile industry. I 
do not see how they can well present a more hopeful picture. 

In recent weeks' representatives of management have come to take a more 
realistic view of employment prospects in the auto industry than they had before. 
Certainly it is difficult now to speak of a shortage of labor as a bottleneck in the 
defense program. 

This marks a considerable change over earlier attitudes. Representative of 
the thinking 2 or 3 months ago of auto company executives is the following state- 
ment which appeared in a study of The Auto Industry's Role In Defense pre- 
pared by Wards" Automotive Reports in July of this year: "The automobile indus- 
trv, therefore, is likely to add to its pay rolls by next spring a total of approxi- 
mately 450,000 men. ' This is a tremendous total — about the equal of the 447,000 
hourly rated employees which the plants are estimated to have employed in 
1940.'' 

GENERAL EFFECTS OF PRIORITY UNEMPLOYMENT 

All of us in Michigan are deeply concerned with the direct economic effects of 
this dislocation upon our workers and our communities. If a well-planned pro- 
gram can be followed out by industry, labor, and Government these unfortunate 
repercussions can be kept at a minimum. But this problem must become not 
only the concern of the auto worker whose security and standard of living has 
been made precarious. Along with the worker the large group of tradesmen and 
professional people whose incomes are dependent upon his wages are threatened. 
The farmers of this State, too, stand to lose through the misfortune of the city 
workers who make up their primary market. 

Certain groups of workers are more seriously endangered by this "priority 
unemplovment" than others: 

1. The right to employment for Negro workers in the auto industry on defense 
production has been resisted by many corporations. I am advised that repre- 
sentatives of the Congress of Industrial Organizations in Chicago have taken 
steps to bring the General Motors Corporation to the elimination of discrimina- 
tion against workers of Negro or Jewish origin. 

2. With the whole transition to defense production, the position of women 
workers in the auto industry is threatened. Management has claimed in many 
cases that work available on defense production is not suitable to the capacities 
of their female emplovees. This attitude must be reckoned with here however 
much it is in variance "with the experience of British industry in meeting problems 
of wartime production. 

3. Groups of skilled workers in the auto industry are finding that the present 
training is of small help to them in securing defense employment. Large numbers 
of trimmers, and polishers, for instance, are in a difficult position. 

4. The unskilled worker and the older production worker are in weak positions 
to meet the competition of a labor market which still contains close to 7,000,000 
unemployed. Onlv through the protection of the union in securing employment 
can workers in these categories find stability for themselves and their families. 

RESPONSIBILITY FOR DISLOCATION 

For many vears the American automobile industry has had a world-wide 
reputation for 'its resourcefulness, initiative, and mastery of productive technique. 
It is this industrv with its record of magnificent accomplishment which had been 
counted on to provide the productive power necessary to make this country an 
arsenal of democracv. 

A confidential bulletin of the Bureau of Foreign and Domestic Commerce,, 
quoted by I. F. Stone in his recent book, Business As Usual, states: 



NATIONAL DEFENSE MIGRATION 7263 

"The automobile industry is the outstanding major industry capable of pro- 
ducing a much larger volume of defense materials * * * the automobile 
industry constitutes our largest available reserve, contained in any single industry, 
of productive power for defense." 

Why is it that the contribution from this major industrial power to our national- 
defense program has been, comparatively speaking, negligible? Out of 250,000 
workers employed by General Motors in June 1941, only 34,000 were employed 
in national-defense work. And at the present tim^e our estimates would indicate 
that no more than 45,000 General Motors' workers are producing for the national- 
defense program. The same ratio of defense to nondefense work appears to pre- 
vail throughout the industry. National defense production in the auto industry 
has been made up primarily of magnificent reports of plant construction and 
engineering aspirations. Not one-tenth of the basic productive power in the 
industry, even at this time of world crisis, has been directed toward ends of 
national defense. It is in this situation that the explanation of a tragic paradox — 
threatening unemployment to skilled workers and productive equipment of the 
automobile industry at a time of national emergency — is to be found. 

In November of 1940 our union made certain proposals to the Office of Produc- 
tion Management and to the automobile industry for the speedy and complete 
development of national-defense production in automobile plants. A plan to 
achieve this purpose was worked out at my suggestion by one of our officers, 
Mr. Walter P. Reuther, with the assistance of designers and skilled craftsmen of 
the industry. This plan proposed the following: 

1. That the excess productive capacity of the automobile industry be at once 
mobilized for defense. Mr. Reuther demonstrated that tremendous resources 
in machinery and equipment were used in the automobile industry only at certain 
periods of the year. With the leveling off of production schedules, such equip- 
m.ent would become available for immediate diversion to national-defense pro- 
duction. 

2. That the tooling resources of the automobile industry, including men and 
equipment, be diverted immediately toward a general tooling up of the industry 
for national defense purposes. With at least 200,000 machine tools available in 
the industry, operated by a large mass of the most skilled workers in the country, 
this tremendous machine-producing power could have been directed toward the 
retooling of auto equipment for the production of aircraft and other items of 
national defense importance. Such utilization of automobile machine-tool capac- 
ity would have meant postponement of the annual model change-over for the 
industrv. 

Had steps been undertaken back in November of 1940 to call upon the produc- 
tive power of the auto industry for national-defense purposes, we would not now 
be facing a tragic crisis of unemploym^ent and retarded production. Had in- 
dustry and Government been willing to undertake this essential task, defense 
jobs developed in the industry would now be more than sufficient to absorb the 
full complement of automobile workers displaced by curtailment of regular 
automobile production. , 

In emphasizing this point, I am not seeking primarily to criticize representatives 
of industry and government responsible for this failure. I am emphasizing it 
because it is my conviction that the basic elements of the Reuther plan are still 
applicable and must be brought to bear if we are to find a way out of the present 
impossible situation. The key to our whole problem, in my opinion, lies in the 
acceleration of conversion from regular automobile to national-defense production. 
For this purpose the basic thesis of the Reuther plan that present automobile 
machine tools and factories may be readily adapted to national-defense purposes 
is still of the most vital importance. Automobile machine tools and the skilled 
craftsmen to operate them are still available for the rapid transformation of this 
industry. This can be done, and will be done, provided Government and indus- 
try authorities are willing to cooperate with labor in the full coordination of all 
production and tooling facilities in this industry in a major campaign to make 
Flint, Detroit, and the other centers of automobile production main resources in 
the drive to out-produce Hitlerism. 

Auto workers throughout the country believe that a major crime against na- 
tional defense and their own welfare has been perpetrated in this refusal of indus- 
try to prepare adequately for national defeiise. Major automobile companies 
have preferred not to tamper with their regular productive eciuipment. They 
have hesitated to do anything which might interfere with their capacity to expand 
production in the highly competitive production of automobiles. Instead they 
have accepted Governnient funds for the building of new defense plants and the 

60306—41 — pt. 18 14 



7264 DETROIT HEARINGS 

purchase of new machine tools.' They have accepted only such defense orders 
as nii^ht be produced in these plants without interference to their "business as 
usual" program. 

Auto workers recognize that this policy of expanding "business as usual" and 
accepting defense work as a marginal activity may well prove an expensive one 
to the country at large. 

For the past few months, as the world situation has become more and more 
critical, well over 20,000 tool and die makers have been operating the machine 
tools of the auto industry in producing the tools, dies, jogs, and fixtures necessary 
to the production of new model cars. These critically important men and equip- 
ment have been devoting their full energies to the creation of more attractive 
automobiles; and from advance advertising, these automobiles appear to be very 
attractive indeed. But I fear that they have been produced at the very high price 
of unemployment to automobile workers and slow-down to the national defense 
program. 

In concluding the discussion at this point, I may say, on behalf of my organiza- 
tion, that automobile workers are now ready as they have been in the past to take 
the most energetic steps in cooperation with industry and Government for meet- 
ing this situation. 

In the interests of national defense, in the interests of economic security for 
automobile workers, immediate steps must be taken for the speedy transformation 
of the auto industry into a basic section of the American "arsenal of democracy." 

SHORTAGES 

It is true at the present time that one element of the Reuther plan cannot now 
be carried through, and that is the continuation of regular automobile production 
while surplus facilities are changed over to national defense production. This 
cannot be done because supplies of steel, ahuninum, nickel, zinc, copper, and other 
essential elements are insufficient to maintain both regular atito production and 
all-out production for national defense. 

For this situation auto workers place responsibility on the monopolistic "busi- 
ness as usual" practices adhered to by major producers of these essential materials. 
We have seen the evidence brought forward by the Truman cominittee's investi- 
gation of the aluminum monopoly. We are familiar with the resistance to 
expansion of steel productive facilities carried through by the American Iron and 
Steel Institute and certain officials no longer connected with the Office of Pro- 
duction Management. But we are happy to see that the American public is at 
last becoming conscious of these problems; that steps are at last being taken 
through Government agencies such as the Supply Priorities and Allocations 
Board for organizing full productive capacity. We believe that such stejis will, 
in the long nni, solve the problem of the automobile worker, and that in solving 
his problem, the problem of the Nation as a whole will be met. 

IMMEDIATE STEPS 

As I have indicated before, the problem of unemployment in the automobile 
industry depends for its solution upon a speedy transition to full national defense 
production. This means the elimination of red tape in awarding contracts in all 
places where priority unemployment threatens; this means the all-out utilization 
of the engineering, designing, and tooling facilities in the auto industry in a 
coordinated program of national defense tooling; this means, above everything 
else, an abandonment of "business as usual" psychology in a full power drive for 
defense production. 

At the best, however, this cannot be an immediate solution to the auto worker's 
problem. Mistakes have been made for which the auto worker is going to have 
to pay the bill in uncm])loyment and economic insecurity for a period of some 
months. To meet this situation, therefore, the United Automobile, Aircraft, and 
Agricultural Implement Workers, Congress of Industrial Organizations, brings 
forward the following program: 

' LavSt wintor when major energies of auto corporations should have been directed toward converting plants 
to arms production, they were instead engaged in a record-smashing passenger car production and sales 
campaign. That brought big profits out of defense prosperity. But now last winter's "business as usual" 
is going to mean "unemploynient as usual" for auto workers. 

Thesy plants will doubtless be highly elhcient plants capable of asserting dominance in the aircraft indus- 
try following the comijletion of our defense program, 'i'hcy are more valuable, therefore, to their present 
owners than a regular automobile factory tooled up for di'fcnse production upon an emergency basis. Such 
factories might not be able to meet peacetime aircraft coiTipetition. 



NATIONAL DEFENSE MIGRATION 7265 

1. Full and complete enforcement of Office of Production Management principles 

for employment security to automobile workers. 
In recent weeks a series of meetings on this problem has been held in the city 
of Detroit between officials of industry, the U. A. \^^-C. I. O., and the Office of 
Production Management. Through these meetings a policy for transferring ex- 
perienced automobile workers to defense jol:)s through channels of the United 
States Employment Service has been worked out. This policy guarantees that 
developing defense jobs will go first to experienced automobile workers in order 
of their seniority, and that younger workers will be secured in their employment 
on regular automobile production. This is the essential principle of the Buffalo 
plan. But to become effective that principle must be secured by more adequate 
machinery in its application; must be confirmed by more active cooperation from 
the employers of defense labor. 

2. Protection of the economic security of displaced automobile workers. 

Even in such a city as Buffalo, N. Y., where tremendous demand for national- 
defense labor is developing, the Buffalo plan by itself has provided employment 
up to September 20 for only 1,200 out of 3, 600" unemployed automobile workers. 
In centers such as Detroit," Flint, and other cities of Michigan, where there will 
be no immediate expansion in over-all employment, the ratio of men finding 
defense jobs to those unemployed will be considerably smaller for some time. 
These workers must be protected by more adequate unemployment compensation. 
With rising living costs, with generally chaotic economic conditions, unemploy- 
ment benefit payments must be increased. A sum of .$110,000,000 at the dis- 
posal of the Michigan Unemployment Compensation Commission indicates that 
this may be done through a specially called session of the Michigan State Legis- 
lature. 

1 am advised also that in England at the present time, workers undergoing 
training for national defense receive wages equal to their normal full-time wages. 
It is the responsibility of both industry and Government to provide such corn- 
pensation to groups of automobile workers who may require new skills for their 
employment in the national defense program. 

3. A moratorium on debts for unemployed automobile workers. 

With the high rate of employment and weekly earnings prevailing in the indus- 
try during 'recent months, many auto workers have undertaken heavy financial 
responsibilities. They must not, in this period of emergency, be deprived of their 
homes, their furniture, or of their automobiles. Protection of these workers is 
basic to the maintenance of morale among them and in the communities in which 
they live. 

4. Increased production and employment in national-defense plants. 

The recent meeting of the international executive board of the U. A. W.-C. I. O. 
has called for the adoption of an additional shift with proper overtime payment 
in all automobile-industry national-defense plants. This would increase the 
hours of operation in national-defense plants to 160 per week and would provide 
employment for at least 25 percent more automobile workers. Such a develop- 
ment should be given the serious consideration of industry and Government. 

5. The adoption of the Murray plan for the automobile and other industries. 

The Murray plan calls for the adoption of industiy councils representative of 
labor, industry, and government in each one of the basic defense industries 
throughout the country. In the automobile industry, such a council would have 
responsibility for the placement of contracts, for the utilization through subcon- 
tracting of all the productive facilities, both in large plants and small plants, for 
the coordination of tooling and productive equipment in an all-out production 
drive, and for the protection of labor's democratic rights as a thing essential to 
productive morale. 

The principle must be recognized that national-defense production should not 
be the private concern of powerful monopoly interests. It is a vital concern of 
the workers involved, and of the Nation through its government, as well as the 
executives of major industry. Fuller recognition of this fact will be the founda- 
tion for future successful progress in our defense program. 



7266 DETROIT HEARINGS 

(The following was received subsequent to the hearing and is made 
a part of the record, in accordance with instructions from the chair- 
man:) 

SUPPLEMENTARY STATEMENT OF R. J. THOMAS, INTERNATIONAL 
PRESIDENT, UNITED AUTOMOBILE, AIRCRAFT, AND AGRICUL- 
TURAL IMPLEMENT WORKERS, CONGRESS OF INDUSTRIAL 
ORGANIZATIONS 

Automobile Capacity for Defense Production 

For the last 9 or 10 months considerable discussion has been going on regarding 
the adaptability of automobile plants and equipment for defense production. It 
has been the position of the U. A. W.-C. I. O. that the large bulk of automobile 
productive machinery could be adapted to various types of defense production 
within a comparatively short period. This could be done as proposed by Mr. 
Walter P. Reuther, by the coordination of the tooling facilities of the auto in- 
dustry for the production of the jigs, fixtures, and tools essential to making defense 
plants out of auto plants. 

Representatives of the automobile manufacturers have urged strongly an 
opposing point of view. Said Mr. Alfred P. Sloan, Jr., chairman of the General 
Motors Corporation, on November 20, 1940: "* * * Automobile plants are 
not adaptable to the manufacture of other products. Repeated surveys have 
indicated, for instance, that only about 10 or 15 percent of the machinery and 
equipment in an automobile factory can be utilized for the production of special 
defense material." Mr. Sloan added, "It is usually necessary to provide new 
facilities, including machinery and tools." 

It was on the basis of tin position that the automobile industry, the Office of 
Production Management, and the United States Army and Navy have, up to 
the present time, at least, followed a program of building new plants and of 
developing new production equipment instead of utilizing facilities already avail- 
able. 

There is strong evidence to support the position of the U. A. W.-C. I. O. 

Advice received from a large number of engineers and designers, who are 
involved in both the automotive and aircraft industry, indicates beyond question 
that the proportion of machinery and equipment available for early change-over is 
many times higher than the estimate of 10 to 15 percent made by Mr. Sloan in 
the statement quoted above. According to these men whose daily work is the 
solution of tooling and production problems, at the very least, 50 percent of the 
productive equipment of the automobile industry is available for change-over to 
defense work within a period of from 3 to 6 months. 

list of newly installed machines 

Aircraft machine tools differ from those used in the auto industry only in the 
jigs and fixtures employed. In this connection I should like to list machines 
newly constructed and installed in the Allison division of the General Motors 
Corporation in the city of Detroit. These machines listed are installed for the 
production of aircraft parts ?jid duplicate existing automobile-jilant machinery: 

Grinding machines: Cincinnati centerless, Exlo internal and external, Bland, 
Norton, Landis, Blanchard, Brown & Sharpe, (Bryant) and Held. (These ma- 
chines are used to produce the following parts which are common to both aircraft 
and automobile motors: Camshafts, crankshafts, bearings, connecting rods, wrist 
pins.) Milling machines: Milwaukee, Cincinnati, Sunstrand, and Brown & 
Sharpe. Keller machines: Wickes lathes, Greenlee lathes, and Cincinnati 
lathes. Spline machines: Sunstrand and Brown & Sharpe. Hones: Exlo and 
Wickes. 

figures of general motors president cited 

It is interesting to note that in his speech of September 10, 1941, Mr. C._E. 
Wilson, president of the General Motors Corporation, expresses opinions which 
seem to be at variance with those expressed months before by Mr. Sloan. Says- 
Mr. Wilson: "General Motors has a productive capacity and has been producing 
approximately 8 percent of the total durable goods produced in the United States. 
On this basis the corporation's proportion of the defense program for this type of 
material would be about 8 percent." 



NATIONAL DEFENSE MIGRATION 7267 

Mr. Wilson is here assuming that general capacity to produce consumers' 
durable goods is directly transferable to capacity in the production of defense 
goods. 

That is the position which our union has been taking for the last 10 months. 
We believe it most unfortunate that a recognition of this fact has not been made 
by Government or industry up until this comparatively late stage of our defense 
program. 

Because of this failure, the General Motors Corporation can report that out of 
$1,350,000,000 production of finished durable goods during the first 6 months of 
1941, only $131,000,000 worth of that production was in the field of national 
■defense. This corporation, with 8 percent of America's total durable-goods ca- 
pacity, has devoted less than one-tenth of that capacity to defense production 
up to the present time. 

Even more unfortunate, however, will be the effects of this policy in the months 
to come when the full curtailment of auto production takes place throughout 
the industry. Then auto workers will pay the penalty in unemployment for 
apathetic national-defense preparation. If this had not been true, if a recogni- 
tion of the auto industry's responsibility toward national defense had come some 
months ago, preparation for a change-over might now be well under way. The 
necessary engineering work, the work in designing and tooling, could have been 
carried through without interference with regular automobile production during 
the early months of 1941. True, the introduction of new models for 1942 would 
have been postponed, but some 30,000,000 hours of skilled labor in the utiliza- 
tion of essential jnachine tools might have been diverted from producing new 
model cars to open the way for gigantic national-defense production. 

"business as usual" 

But the conception of "business as usual" triumphed in governmental agencies 
as well as in the industry itself. New models were allowed. The largest group 
of skilled workers in the country labored long hours to produce sleeker curves 
and fancier grillwork. As a result, we are only now beginning the program of 
retooling for defense production, which should have been initiated early in the 
winter of 1941. In conseqlience, automobile workers are left to face an extended 
.period of unemployment — a period of unemployment which might well have been 
obviated by early planning for defense retooling. 

Even at the present time, both industry and Government have failed to take 
adequate steps to coordinate the full tooling facilities of the auto industry for 
the change-over to defense production. A survey conducted by the Detroit and 
Wayne County Tool, Die, and Engineering Council in 34 Detroit automobile 
plants indicates that out of a total of 1,577 machine tools, 337 of those tools are 
idle throughout the week. The remainder are being operated at an average of 
70.4 hours per week. With capacity operations of all these macliines on the basis 
of a 160-hour week, total weekly operation would be equal to 252,320 machine- 
hours. Instead, actual machine-hours are in the neighborhood of 87,296. This 
means that these tools, which are the most essential and most critical to the 
defense program, and of crucial importance to retooling the entire industry, are 
at the present date being employed at no more than 35 percent of full capacity, 

COORDINATION IN USE OF EQUIPMENT URGED 

In the opinion of the U. A. W.-C. I. O., this is a startling situation. It is our 
conviction that immediate steps b.y authorities of the Army, Navy, and other 
Government agencies should be taken to coordinate this reservoir of unused 
equipment for the full and immediate transition of the auto industry as a whole 
to defense production. This is the key to an early solution of the employment 
problems now confronting auto workers. Even more important, it can be made 
a key to the solution of America's basic problem — the problem of producing arms 
in sufficient quantities to frustrate Nazi designs for world domination. 

I have been advised by many local unions in our organization of another 
problem which has developed in connection with securing full defense production 
and employment. Information received by my office indicates that considerable 
difficulty has been encoimtered in adjusting specifications established by the 
ordnance departments of the armed forces to the necessities of mass production. 

Too often the sjjecifications had been rigidly established some years ago and 
are adhered to at the expense of efficient production methods. The auto industry, 
for instance, has developed many time-saving techniques for welding. These 



7268 



DETROIT HEARINGS 



have been tested and checked and found to be eminently rehable. Army and 
Navy officials, however, have been very slow to relax specifications calling for 
riveting. They have been reluctant to accept welded parts. Such attitudes are 
an obstacle to obtaining maximum i)roduction at the earliest possible moment in 
the interests of our national-defense program. 

IMay I assert again labor's profound conviction that it has a very positive 
contribution to make in solving the problem of defense production throughout 
this country. Up to the present time labor has not been called on to make such 
a contribution; and, as in regard to the Reuther plan, its efforts along that line 
have not found a welcome in official quarters. It is labor's conviction that in 
such a battle as we are now facing for the defense of democracy, the extension 
of the democratic method itself is the surest guaranty of final victory. 

Labor welcomes recent indications that both industry and governmental 
agencies are beginning to shake off the apathy and red tape which have so far 
circumscribed the auto industry's participation in the defense program. As 
workers and as citizens of a democracy we are ready to cooperate in a further 
essential advance along that front. 

Machine availability survey of the Det-oit and Wayne County Tool, Die, and Engi- 
neering Council, Oct. 10, lOJ^l 

[34 plants surveyed] 



Name of machine 



Lathes 

Planers 

Shapers 

Grinders 

Mills 

Boring mills 

Kellers 

Screw machines 



Total 
number 

ma- 
chines 



Total 
idle ma- 
chines 



261 
49 
237 
296 
171 
81 
40 
27 



Name of machine 



Blotters 

Jig borers 

Radial drills 
Drill presses. 
Do-all_ 

Total- 



Total 
number 

ma- 
chines 



30 

27 

87 

266 

5 



1,577 



Total 
idle ma- 
chines 



10 1-4 
3^i 

17 

40 
1 



337 



21.4 percent of total number of machines are idle. 

These plants are operating on an average of 44 percent of a full 7-day workweek. 

Source: Research department, United Automobile, Aircraft, and Agricultural Equipment Workers, 
Congress of Industrial Organizations, Detroit, Mich. 



TESTIMONY OF E. J. THOMAS— Resumed 

Mr. OsMERS. Now, Mr. Thomas, you say not one-tenth of the basic 
productive power in the industry, even at this time of world crisis, has 
been directed toward ends of national defense. 

I wonder if you would enlarge upon that. 



UNDER-CAPACITY PRODUCTION 

Mr. Thomas. The automobile industry for a great many years 
has never run at full capacity. What I mean there is that, due to the 
intense competition in the industry, there was a great amount of 
unused floor space and machinery. Even in the past year, when 
there was record production in the automobile industry, a great deal 
of that space was not being used. 

Some 8 or 9 months ago w^e brought this fact to the attention of 
various Government officials in Washington, and we tried very hard 
at that time to get additional defense w^ork in the industry because 
we knew from our experiences in the last war that there w^ould have to 
be considerably more production of national-defense materials than 
was being achieved then. 



NATIONAL DEFENSE MIGRATION 7269 

We made a survey at that time, and since that time have kept very 
close tab on the amount of work coming into the industry, and we 
find in comparison with the amount of work put out by the industry 
as a whole that the national-defense production is only a very minor 
portion of the total. 

SLOW TO CONVERT PLANTS FOR DEFENSE PRODUCTION 

Mr. OsMERS. Now, you make another statement which in itself 
constitutes a serious charge. I arti going to read it at this time 
[reading] : 

Auto workers throughout the country beheve that a major crime against 
national defense and their own welfare has been perpetrated in this refusal of 
industry to prepare adequately for national defense. Major automobile com- 
panies have preferred not to tamper with their regular productive equipment. 
They have hesitated to do anything which might interfere with their capacity 
to expand production in the highly competitive production of automobiles. 
Instead they have accepted Government funds for the building of new defense 
plants and the purchase of new machine tools. They have accepted only such 
defense orders as might be produced in these plants without interference to their 
business-as-usual program. 

Last winter when major energies of auto corporations should have been directed 
toward converting plants to arms production, they were instead engaged in a 
record-smashing passenger-car production and sales campaign. That brought 
big profits out of defense prosperity. But now last winter's business as usual is 
going to mean unemployment as usual for auto workers. 

These new plants will doubtless be highly efficient plants, capable of asserting 
dominance in the aircraft industry following the completion of our defense program. 
They are more valuable, therefore, to their present owaiers than a regular automo- 
bile factory tooled up for defense production upon an emergency basis. Such 
factories might not be able to meet peacetime aircraft competition. 

Mr. Thomas. I might give you an example that ties into that 
statement very closely. 

PROTESTS LOCATION OF BUICK PLANT 

When plans were being discussed for building the new Buick plant 
in the city of Chicago, to manufacture Pratt & Wliitney engines, I 
personally made a protest to Mr. Knudsen against the location of that 
plant. 

Mr. OsMERS. What was your protest based on, Mr. Thomas? 

Mr. Thomas. It was based on the fact that I personally felt and 
knew that if this country was to have a war program such as was 
necessary to defeat Hitler, there couldn't be "business as usual." 

LOCATION OF PLANT AS CREATING UNEMPLOYMENT 

Now, the headquarters of the Buick Co. is in Flint, Mich. That 
plant has been their major producing unit. I felt a great number of 
workers in Flint would be out of work, and building that plant in the 
city of Chicago would not relieve their position. I also felt that in a 
city like Chicago the new factory would not have the labor required — 
mechanically trained labor, such as would be available in Flint. I 
brought this to the attention of Mr. Knudsen. I protested violently 
on the matter, declaring that by taking work like this out of Flint and 
other centers, the industry would be very likely to make ghost towns 
out of those particidar places. 



7270 DETROIT HEARINGS 

Mr. ICiiiidsen answered that they couldn't build the plant in Flint, 
due to the fact that there would be a labor shortage. 

Well, of course, he and I disagreed on that. He claimed there 
would be a labor shortage and I claimed that if the plant at Flint 
was abandoned, Flint would become a ghost town. Today I think 
it is generally conceded that I was correct. There is a lack of defense 
work in Flint. There are thousands of people in Flint out of work, 
and the building of the Chicago plant is gonig on; and even today, 
in my opinion, it would pay at this late date to see that those Pratt 
■& Whitney engines are built in "Flint rather than in Chicago — even 
if the Chicago plant has to stand idle. 

Mr. OsMERS. Does Buick build its motors in Flint? 

Mr. Thomas. Yes. 

Mr. OsMERS. They have motor mechanics there? 

Mr. Thomas. Yes, certainly. 

Mr. OsMERS. Was it evident to you or to Mr. Knudsen or to 
anyone concerned with the situation that there was any number of 
unemployed motor mechanics in the Chicago area? 

Mr. Thomas. Well, I can't give figures, but it is a fact that in the 
city of Chicago there just haven't b^en any mass groups of people 
who have had experience in building motors, because it hasn't been 
done there. 

Mr. OsMERS. I was wondering why the O. P. M. would look over 
the map of the United States and pick out Chicago as a place to 
build these motors — whether there w^ere any particular skills there, 
or an availability of materials, or any other factors that would 
influence them to do that. 

I know Chicago is a big city, and I know they could probably get 
a wide assortment of labor, but are the specialized skills required in 
manufacture of airplane engines available there? 

Mr. Thomas. For that particular kind of work there is certainly 
sufficient labor in Flint. There is no question about that. 

ON LABOR SHORTAGE 

The Chairman. Mr. Thomas, I w^onder if I could interrupt for a 
moment. There is a feeling in the United States, inspired by propa- 
ganda from certain sources, that our labor supply is exhausted. The 
Navy Department is turning down contracts because they say the 
plants cannot get the necessary labor. 

But we had a witness in Washington recently who testified there 
were 6,000,000 people registered with the employment offices in the 
United States. Do you believe the national-defense program cannot 
be supplied with the necessary labor? 

Mr. Thomas. No; there is plenty of labor. One of the problems in 
our particular industry is created by the fact that certain people liigh 
in the industry and in Government for the past 2 years have been 
putting out information that there would be a shortage of labor. The 
thing that I am afraid of is that such statements will bring down the 
morale of the automobile workers. Morale of the workers is being 
affected right now by the very fact that thousands of people are being 
laid off today with no opportunity of a job at all. 

The Chairman. Congressman Arnold. 



NATIONAL DEFENSE MIGRATION 7271 

Mr. Arnold. Mr. Thomas, couldn't both the FHnt factory and the 
Chicago factory be operatecl? Is there any reason why the Fhnt 
plant couldn't yet be converted, even though it is late in the defense 
program? 

Mr. Thomas. There is no reason why it could not be converted 
for defense purposes. 

Mr. Arnold. Then why shouldn't it be converted and both plants 
operate? 

Mr. Thomas. Some of the things that are happening today are 
due to inefficient planning in the past. 

The thing that you suggest could be done, but to relieve the unem- 
ployment situation, I think the job should be done in Flint first; 
then, if it is necessary for additional expansion, the additional jobs 
could be done in Chicago. 

The Chairman. Congressman Osmers. 

Mr. Osmers. Mr. Thomas, you know this committee is primarily 
concerned with the migration of people from one section of the country 
to the other as a result of the national defense program. 

migration induced by location of plants 

We see no reason for depriving an American citizen of the right to 
move anywhere he wants to move in the country, but our object is 
to avoid needless and wasteful migration. 

Now, if we have motor mechanics in Flint, Mich., who are uneln- 
ployed as a result of the defense program, and we build a motoi plant 
in Chicago as a part of the defense program, isn't that likely to result 
in a clear case of needless and wasteful migration? Will not such a 
program make it necessary to uproot workers from other parts of the 
country and bring them to Chicago? 

Mr. Thomas. That is riglit. 

Mr. Osmers. I know if 1 happened to be one of those unemjjloyed 
workers in Flint, and the plants stopped making airplane motors 
there and started to make them in Chicago, I would go to Chicago to 
look for a job. 

Mr. Thomas. That is correct. 

Mr. Osmers. And tear my children out of school and upset my 
family and try to find new living quarters. 

Mr. Thomas. The people working in Flint — a large porportion of 
them — have been living in Flint for a great many years. They have 
their homes there. There arc certain economic factors which make 
it difficult to transplant a man and his family from one place to 
another in a short space of time. 

But when a man gets hungry he will go anywhere to work. He 
might have a home and an investment in Flint, but nevertheless he 
will go to Chicago, if he has to, rather than let his family go hungry. 
For these workers, making such a move is practically starting life 
over again. And after the national defense program is over, then what? 
Then he is confronted with the necessity of having to go back to Flint 
again. 

Mr. Osmers. And the chances are that the process of moving — 
that is, of sefiing out in Flint and buying in Chicago and establishing 



Y272 DETROIT HEARINGS 

himself thoro, and then moving back to Fhnt — would certainly take 
XI way from him any benefits that he might have received by making 
the move in the first place. 

HOUSING PROBLEMS 

Mr. Thomas. Not only that, but we find in our investigations in 
many places in the country today that it is practically impossible for 
a worker to buy or rent a home."^ People who control the real estate 
market are deliberately putting rents so high as to force workers to buy 
rather than rent. Places that would normally be available for rent 
they will not rent. They want to sell them. 

Mr. OsMERS. Tliis committee, in traveling around the country, has 
yet to find a place where rents haven't been increased to a ridiculous 
degree — out of line with anything else in the community, and I am 
■sure that that would follow m Chicago or any other place. 

RENT RISES 

Mr. Thomas. The average automobile worker's rent has increased 
around $5 a month within the last 6 months. 

Mr. OsMERS. You refer to the average automobile worker in 
Michigan? 

Mr." Thomas. No; I am referring to the automobile centers of the 
entire country. I w^ould include in that figure Detroit, Pontiac, and 
Flint. Those are the key cities in Michigan. Then, in addition, there 
is South Bend, Los Angeles, and Anderson, Ind. Those are the key 
automobile centers of the country. 

Mr. Curtis. That is out of line with the upward swing of other 
costs? 

Mr. Thomas. Yes, it is. 

IVlr. Curtis. By about what proportion? 

Mr. Thomas. I should say it would be about 50 percent more. I 
mean rents have advanced about 50 percent faster than commodities. 

Mr. OsMERS. Here is another statement, Mr. Thomas, that I am 
going to read back to you for your comment. This statement is on 
page 8 of your paper: (In tliis volume, p. 7263.) 

Had steps been taken back in November of 1940 to call upon the productive 
power of the auto industry for national-defense purposes, we would not now be 
facing a tragic crisis of unemplovment and retarded production. Had industry 
and Government been willing to undertake this essential task, defense jobs de- 
veloped in industrv would now be more than sufficient to absorb the full comple- 
ment of automobile workers displaced by curtailment of regular automobile 
production. 

Mr. Thomas. \'Ve approached management and Government. 
Around November of 1940 we brought to their attention the things 
that could be done to expedite the national-defense program. 

I talked to a lot of automobile manufacturers myself, having nego- 
tiations and other matters to take up with them. The situation is 
just beginning to change now. The only conception the average auto- 
mobile manufacturer had of national defense was that it would be 
over and above the usual production in the automobile industry. 



NATIONAL DEFENSE MIGRATION 7273 

Mr. OsMEBS. You moan it was going to be business-as-usiial plus? 

Mr. Thomas. Yes; business-as-usual plus, that is correct. Now, 
of course, we would be very happy with a state of affairs like that, 
but we didn't believe it was' going to be that way. I think we recog- 
nized the facts sooner than the manufacturers did. There was a 
bigger job to be done than the average person realized. 

ALLEGED SHORTAGES OF TOOL AND DIE LABOR 

At that time the newspapers of the country, as I said before, were 
carrying stories — for instance, that there was a shortage of tool and 
die makers. 

We pointed out to Government and industry — and industry here 
in Detroit knew it without our pointing it out to them — that there 
were thousands of tool and die makers walking the streets, looking 
for work. Those tool and die makers at that particular time should 
have been utilized in working off the blueprints, making tools and 
dies for something in national defense. 

We proposed at that time that the automobile industry should not 
change models, because we know what happens when there are model 
changes. Again millions of man-hours are used in making new tools 
and dies for the new models. 

We felt that the automobile was or had been developed sufficiently 
for a period such as we are in now, and that we could very well be in 
a position to forego the change of models. Nevertheless, models were 
changed. Time was lost. Klillions of man-hours were lost in build- 
ing tools and dies for automobiles, hours that should have been spent 
in building tools and dies for airplanes, guns, and motors. 

It is only recently that we have been holding joint meetings with 
Government and industry, trying to work out some program. Pre- 
vious to that nobody would discuss the matter with us at all. 

Mr. OsMERS. You say in your paper: 

Automobile machine tools and .skilled craftsmen to operate them are still 
available for the rapid transformation of this industry. 

Mr. Thomas. That is correct. 

Mr. OsMERs. Is that statement at variance with the general im- 
pression around the country that skilled men to do that are not 
available? 

Mr. Thomas. That is correct. 

Mr. OsMERS. Upon what do you base your statement and upon 
what do they base their statement? 

Mr. Thomas. I was just about to tell you that less than 2 weeks 
ago I called a meeting here in the city of Detroit of various com- 
mittees we have set up to make a survey of people unemployed. 
We are making a survey to determine exactly what they are doing, how 
much national-defense work is being done in the plants, and so forth. 

The president of our local, which is No. 157 and is a tool and die 
makers local in the city of Detroit, was present. On that night it 
was stated by some representatives of O. P. M. whom I invited to 



7274 DETROIT HEARINGS 

the meeting that there was a shortage of tool and die makers. The- 
president of this local, William Stephenson, stated that night that at 
that moment in his local union there were 200 tool and die makers 
out of work who were looking for jobs, and he would give that list to 
anybody who wanted tool and die makers. 

Mr. Os.MERS. How is it then, that manufacturers in general say 
that there is a shortage of tool and die makers in the country? 

LOCATION OF PLANTS AS CAUSE OF LABOR SHORTAGES 

Mr. Thomas. I don't know why they say it but I will tell you why 
I think they say it. You build a plant like the Buick plant in the city 
of Chicago. Chicago is not a tool and die town, to any great extent,, 
and never has been. They ma}^ be having difficulty in getting tool 
and die makers, due to the fact that these workers resist migration. 

When you build an aircraft plant in Wichita. Kans., or out in some 
cornfield in low^a, certainly you will have difficulty in getting tool 
and die makers. These woi'kers are like other men. They resist 
migration. There is that resistance against moving. That is one- 
of the reasons why we saj^ that work, more work, should come into the- 
c enters where the men are available. 

Mr. OsMERS. I take it from that, Mr. Thomas, that you would 

Mr. Thomas. Will you pardon me a minute? Mr. Addes would 
like to give you a few supplemental remarks on that. 

Mr. Addes. I would like to supplement Mr. Thomas' remarks on 
the question of skilled workers in the industry. 

SKILLED WORKERS SHIFTED TO PRODUCTION JOBS 

We have a great number of skilled workers in the industry who,, 
after each season when the automobile industry changes models, are- 
transferred into production work, such as assembling automobiles- 
and working on motors. 

It has been pointed out to the manufacturers here in a recent 
meeting that there have been tool and die makers, tool makers, pat- 
tern makers, and other craftsmen, painting benches, for example, 
or cleaning up motors. 

During the depression days, shortly after the collapse of 1929, a 
great number of these skilled tool and die makers, because of the lack 
of tool and die work, migrated into automobile production. There are 
thousands, literally thousands, of those workers today, working on 
ordinary production, workers who are capable of doing skilled work. 
I mean highly skilled work, such as tool and die making. 

For example, in Flint, in one of the Chevrolet plants, there are 
approximately 400 tool and die makers in one department, the motor 
assembly department, who are doing nothing but assembly work. 

Now, these people, after the last tdol and die season was o\ er, 
ran short of work, and naturally, because of their seniority, they were 
transferred to production work. They are still working on ordinary 
assembly work, which any man could learn in perhaps 2 or 3 weeks' 
time — 2 or 3 days in some instances. We contend that if industry 
would jerk out from the unskilled operations, from these assembly 
lines, all these tool and die makers and highly skilled craftsmen, they 
could find a sufficient number of tool and die makers to work on the 
national-defense tooling job. 



NATIONAL DEFENSE MIGRATION 7275 

In the city of Detroit we find tlie same problem. One of the largest 
tool and die shops in the country is located here in the city of Detroit, 
:and we find that even now that tool and die shop is not loaded to 
capacity. 

There is machinery in there to produce necessary tools and the 
necessary dies for national defense, but management evidently has not 
seen fit to create a sufficient number of jobs to load that plant to its 
capacity. The result is that the national-defense program auto- 
matically bogs down m the contention that there are not enough tool 
and die makers, when as a matter of fact there are plenty of them 
roaming the streets today. 

Mr. OsMERS. You have raised a question in my mind there. You 
have directed your criticism, with respect to that Detroit tool and die 
plant, at management. But let us get down to fundamentals. Man- 
agement can't provide any more work than it has contracts for, and 
if there is a break-down m Washington, as some think there is, in the 
distribution of these orders, you could have any kind of management- 
management of your own choosing — at the Detroit plant, and you still 
would not be using your full capacity. 

PLANTS NOT OPERATED AT CAPACITY 

We have had evidence here in Detroit that Michigan's capacity, the 
capacity of the automobile industry and many other Michigan indus- 
tries, hasn't been fully tapped. The production schedules are not 
short enough; the orders are not large enough. We had evidence 
yesterday from a group representing the Manufacturers' Association 
that a shell contract — to take a very tiny example in the defense 
effort — had been let to a concern in Indiana that was totally unpre- 
pared to handle the contract. The testimony was that a plant here 
in Michigan had tooled up for that work, that it had run an experi- 
mental order and was ready to start production, but that the Govern- 
ment gave the order to this plant in Indiana that had never made a 
shell. That plant was paying about half the wages that they were 
paying in Michigan, and although it may be true that the Indiana 
plant is going to lose a lot of money, the fact remains that Michigan is 
not going to get that business. 

So, not excusing management for any of its sins, I thmk we have to 
proceed very carefully before saying management is falling down on 
nationl defense. 

Mr. Thomas. I think your viewpoint is sound. But going back to 
the tool and die situation, you asked me what, in my opinion, were the 
facts in the matter when management says there is a shortage of tool 
and die makers. 

Mr. OsMERS. I think you answered that question satisfactorily. 

SKILLED WORKERS PROTEST TRANSFER TO UNSKILLED JOBS 

Mr. Thomas. There is another point that cornes to my mind. 
I know of one management in the city of Detroit, in the automobile 
industry, which had some tool and die makers. They had no tool 
and die work for them to do but they thought they might have some 
in the future. So they put those tool and die makers on a job of 
painting the plant, \\lien a man is skilled in a trade, he just doesn't 
like to "do anvthing else. I found out about it from the men, who 



7276 DETROIT HEARINGS 

came to mc and protested because tliey had to paint. They were 
working 4 days a week when other tool and die makers were working- 
7 days a week and getting time and a half for overtime. 

1 find such practices prevalent throughout the industry. The 
manufacturers, when tlie}^ consider it advantageous, will put skilled 
men to sweeping rather than working at their own trades, so they can 
hold on to them. 

SENIORITY RIGHTS 

I think we have a plan worked out now whereby those men can be 
interchanged and at the same time their seniority rights can be pro- 
tected, but as 1 say, it has been only within the last couple of weeks 
that that has happened. 

Mr. Curtis. Would those men rather be released than made to 
sweep floors? 

Mr. Thomas. Certainly. 

Mr. Curtis. So they could go to another city and get defense 
work? 

Mr. Thomas. In some cases it is not even necessary to leave here 
to get other jobs. They can, in many instances, get jobs, but we run 
into this difficulty: In our contracts we have seniority set-ups, whereby 
if a man takes a job with some other company, he loses his seniority 
rights. That makes the man reluctant to leave. 

Mr. OsMERS. Shouldn't those clauses be set aside during this 
emergency? 

Mr. Thomas. We are workmg out now a plan whereby a man's 
seniority will revert to the original plant. 

The Chairman. Mr. Addes, these hearings are very informal, but 
we are still after the facts. We are a part of Congress, here, conduct- 
ing these meetings. We are confronted with talk throughout the 
Nation that skilled workers are not available. Mr. Lovett, of the 
Manufacturers' Association, yesterday advanced the idea that if we 
are turning out steel, we should know how much steel the Army will 
need, how much the Navy will need, and other defense projects. 
Now, if we have half of that steel left, we should know where it should 
go. We should plan for equitable distribution. 

NO SURVEY OF AVAILABILITY OF SKILLED WORKERS 

With reference to your skilled workers, I would like to know if any 
survey has been made by the Federal Government or the State of 
Michigan as to the number of skilled workers, their skills, and their 
availability for transfer. We should have an inventory of the skilled 
and also the unskilled workers. Has there been any survey of such 
resources? 

Mr. Addes. As far as I know, there has been no survey such as 
that. There has been a survey of the skilled workers who are usually 
employed during the change-over of models. When an individual is 
laid off, he comes here to collect his unemployment insurance, and 
that is how the figures are obtained. But to my knowledge there has 
been no survey made of the workers to whom you have reference — 
those who have been transferred over to production, or of the workers 
who moved into production shortly after the depression and who still 
remain on production. 



NATIONAL DEFENSE MIGRATION 7277 

The Chairman. This committee went to San Diego earher in the 
summer. At San Diego is located the Kearney j\lesa housing project. 
That is a project of 3,000 units, designed to house 10,000 people. 
The man who took me around the project said: "We have all the 
workers we want except painters. We can't get any painters." 

I live at Oakland, Calif. When I went back to Oakland, I found 
the employment service there had applications from hundreds of 
painters looking for jobs. We told the authorities about the need for 
painters at San Diego and the result was that they got all the painters 
they wanted. 

Now, what I am trying to point out is there must be some gap some- 
where. Because of the lack of a survey of the type I mention, em- 
ployers don't know where they can get these skilled workers. 

MANUFACTURERS RESIST LABOR SURVEYS 

Mr. Thomas. We have tried to make a survey, but we find great 
resistance on the part of the manufacturers, whose cooperation we need 
in such an attempt. I might say certain State groups have tried 
to make the same kind of survey, but they have always found the same 
resistance. 

Mr. Reuther. There is nothing that would be more revealing than 
the kind of survey that you have proposed. Congressman. 

I think such a survey should be made not only so far as available 
labor supply is concerned, but also to ascertain the available machinery 
and floor space. 

SUGGESTS SURVEY BY GOVERNMENT AGENCY 

We have tried to conduct such a survey as President Thomas has 
indicated. We made a survey not only of the number of our members 
who are employed at present on skilled jobs, but also, in connection 
with the question which Mr. Addes raised, the number of reserve 
skilled workers we have in industry who are at present not employed 
at their particular skill. There is nothing that we would desire more 
than to have an official Government agency, like the United States 
Employment Service, conduct a thorough and detailed survey in that 
field. We claim there is no shortage. We claim that had such de- 
tailed planning been made months ago, we could have had a gradual 
transition from civilian production to defense production. 

Wliile it is true that management isn't at fault as far as these 
problems are concerned, there is a break-down in Washington on the 
part of administrative agencies that are releasing the defense con- 
tracts. And it is also true that industry has sufficient representation 
there to have at least proposed to Government the waiving of its- 
business-as-usual prerogatives, so it would have dispensed with the 
construction of new streamlined cars, with all of their chrome and 
shiny metal parts. Industry could have dispensed with that, and 
immediately started releasing blueprints for the construction of tools- 
and dies. 

There was no shortage then, and there is no real shortage today. 
It can still be done. Business-as-usual methods could, in the long 



7278 DETROIT HEARINGS 

run, accomplish the construction of tlio tools for defense, but the time 
element is all-important. 

Mr. Curtis. In your proposed survey, why wouldn't you hiclude 
material? 

Mr. Reuther. Very good. Make a survey of all that is available. 

Mr. OsMERs. Mr. Chairman, surveys have been attempted by 
unions or by State groups or by other bodies. In my judgment, the 
very first thing accomplished in the defense program should have 
been an inventory of every skill, of every machine, of every material, 
before we started, and we wouldn't be building motor plants in 
Chicago and giving shell orders to Indiana, where they never made a 
shell, or going into the cornfields where obviously there is going to 
be a shortage of tool and die workers. 

This whole concept is wrong. But now we have got to make the 
best of what has been a very bad job. We are trying in our little 
corner of congressional work to cushion the shock — the shock to the 
human side of the picture. You can make up for loss of money; you 
can make up for the loss of a lot of other things; but if you destroy a 
man's home, destroy his family life, you can't make up for that. 

It has been amazing to me. Yesterday we heard a man testify 
that private associations here and the defense contract service had 
to do work that was essentially Washington's job. We find that the 
contracts are let in Washington, apparently in response to the greatest 
amount of pressure or salesmanship that can be exerted in Wash- 
ington, instead of by consulting the file and saying: "There is the 
State of Michigan. They can make these things better than anybody 
else, and that is the place where those orders are going." 

WORKERS STILL EMPLOYED ON NONDEFENSE JOBS 

Now, you say in your paper, Mr. Thomas, that 

For the past few months as the world situation has become more and more 
critical, well over 200,000 tool and die makers have been operating the machine 
tools of the auto industry in producing the tools, dies, jigs, and fixtures necessary 
to the production of new model cars. Engineers, designers, and lay-out men have 
put their labor into making more luxurious cars. These critically important men 
have been devoting their full energies to the creation of more attractive automo- 
biles; and from advance advertising, these automobiles appear to be very attrac- 
tive indeed. But I fear they have been produced at the very high price of un- 
employment to automobile workers and slowdown to the national defense program. 

You further say: 

In the interest of national defense, in the interest of economic security for 
automobile workers, immediate steps must be taken for the speedy transformation 
of the auto industry into a basic section of the American arsenal of democracy. 

Now, concretely, what do you propose to have the Government do 
to make the change-over, to make the arsenal of democracy? 

Mr. Thomas. Vk ell, we made our proposal, as I said, and I think 
from what you have said, you and I could be very much in agreement 
on this. We made proposals over 8 months ago to the Government. 

Mr. OsMERs. Do you renew those proposals now? 

Mr. Thomas. We renew those proposals. 

PROPOSALS MADE TO O. P. M. 

Mr. Arnold. I would like to interrupt for a moment. I would 
like to know who in Government is responsible for not taking this 
advice? To whom did you make the proposal? 



NATI0N.4X DEFENSE MIGRATION 7279 

Mr. Thomas. To O. P. M. 

Mr. Arnold. To whom in O. P. M.? 

Mr. Thomas. Mr. Kniidsen especially. I had conferences with 
Mr. Knudscn myself, and many of these things I am saying to you 
I told him. My reaction was that O. P. M. had in mind "business .as 
usual." I got those reactions from Mr. Knudsen himself. And I 
have found out that the resistance has not been broken down yet. 
We have found great resistance, in our effort to get the cooperation of 
the automobile and aircraft industries. 

I don't think the average American realizes how closely those two 
industries arc bound together. Most of the skilled workers in one 
industry have had the same sort of job in the other. Most of the 
directors in the automobile industry are also directors in the aviation 
industry. They have interlocking directorships, yet they have tried 
their best to keep the two industries completely apart. Why that is, 
I don't know. I don't know, but I have my own ideas. 

They are thinking of keeping the industries apart after this national- 
defense program is over. These men want to make a profit from two 
industries, rather than from a joint industry. That is the only reason 
I know of. 

Mr. Arnold. The responsibility on O. P. M. is jointly shared by 
Mr. Knudsen and Mr. Hillman. Isn't that so? 

Mr. Thomas. We brought it to the attention of Mr. Hillman, and 
Mr. Hillman agreed with us. 

should not repeat early mistakes 

Mr. Arnold. As Congressman Osmers says, we have to make the 
best of a bad job, because of a bad start. We don't want to do any- 
thing now to delay this program, but it is my opinion that those in 
Government who are responsible for this 8 or 10 months' delay should 
not be allowed to make the same mistake over again. 

Mr. Thomas. Well, I certainly agree with you there. 

Air. Osmers. I thmk that until more absolute and complete author- 
ity is granted to some of tlicse individuals handling the problem, we 
are not even going to be able to fix responsibility. 

Take the O^ P. M., for instance. Referring to^the O. P. M. is about 
like referring to a political party. It is so general you can't nail it 
down anywhere. 

Mr. Thomas. I read many editorials and newspapers from all over 
the country. They think labor has a great voice in our affairs. I 
have talked with manufacturers about the situation, and they say: 
''Well, you can do that in Washington, I can't." 

I think one of the reasons for the bogging down of the situation in 
Washington today is that there hasn't been cooperation with labor 
in planning for our defense; labor has not been asked and has not 
been accepted. Labor knows the answer to many of these questions, 
and to some that industry itself doesn't know. Air. Knudsen himself 
does not know the answer to some of these questions. 

I think that was proved when we put out pamphlets months ago. 
I instructed Mr. Reuther, one of our international officers, to make a 
survey, which has been completed. If you were to read that survey 
today, and if Mr. Knudsen and others in Washington would read 
that survey today, they would admit that it would practically fill the 
bill if its findings were carried out. 

60396— 41— pt. 18 15 



7280 DETROIT HEARINGS 

A survey was made by another board member, Mr. Frankenstein, in 
the aviation industry, on skills and so forth. "Wlien it was brought 
out, we couldn't get anybody's attention focused on it. But today 
there are people who are willing to look into those plans, and in some 
cages they are starting to carry out the recommendations. 

SUGGESTS CENTRAL PLANNING BOARD 

I personally think that the plan proposed by President Murray, 
of the C. 1. O., for a top planning board in Washington — a set-up 
headed by the President of the United States or his representative — 
can solve this problem. I also personally feel that it will not be solved 
in any other fashion. 

Mr. OsMERS. I want you to describe to the committee, in your own 
words, changes you woidd suggest in the Washington administration 
of the defense effort. 

Mr. Thomas. I think if there are no changes, you are going to 
have a break-down, a complete break-down of the national-defense 
program. 

Mr. OsMERS. Am I correct in my understanding that you advocate 
centralized authority in some direct appointee of the President — 
shall we call him a "defense czar"? — I think that is the newspaper 
phrase now used. 

Mr. Thomas. I can't be sold on the "czar" idea, because that is 
what we are fighting against. 

Mr. OsMERS. I am using it merely as an often-repeated newspaper 
term. 

Mr, Thomas. I think there should be a more democratic set-up 
than there is today. I think the Army and Navy people are jamming 
things through. 

Mr. OsMERs. A charge was made here yesterday, Mr. Thomas, that 
the Army and the Navy had taken so much material off the market — 
supplies for years and years — that many of these nondefense indus- 
tries had to close down because of a shortage of material. Has that 
been your information too? 

Mr. Thomas. I don't know, I have no connection with that. 

Mr. OsMERS. No one seemed to know definitely about it. Have 
you been informed that they have huge supplies of materials laid 
aside? 

Mr. Thomas. I have read that. But I have not been otherwise 
informed. I say I don't know. I don't know what the facts are in 
the case; but I do say this, that this country is in a fight; we are going 
"all out," as I understand it. 

The Chairman. We arc as close as we can get to actual war without 
being in it, I think. 

QUESTIONS ARMY AND NAVY HANDLING OF DEFENSE ORDERS 

Mr. Thomas. Yes; we are very close, closer than a lot of people 
realize. We are in a national-defense program to protect ourselves 
against dictatorships and Hitlerism. My impression of Washington 
is that we have a set-up in the Army and Navy that is just as dictator- 
ial as any nation in the world today. 

There has been absolutely no democracy, and I know that they have 
placed orders where there just seems to be no sense in placing them; 



NATlOJsTAL DEFENSE MIGRATION 7281 

they have withheld orders when they shouldn't have been withheld, 
when this matter of employment and everything else is taken into con- 
sideration. There is a lot of buck-passing in Washington by people I 
talked to, and there just doesn't seem to be anybody who knows what 
to do about it. 

Mr. OsMERS. We seem to come back to two things all the tune, Mr. 
Thomas— not referring to your testimony especially, but to everyone's 
testimonv with respect to the defense program. One is the crying, 
urgent, patriotic need of an inventory of everything that we have. 

Mr. Thomas. That is right. 

Mr. OsMERS. And second, is some organization in Washington — we 
can call it by any name we want to call it — some organization in Wash- 
ington that wilftake that inventory and convert it into defense for us. 

Now, 1 am trying to find out from you and from every witness what 
that organization ought to be, what kind of organization it should be. 
We don't want to create just another board or bureau for the sake 
of creating another board or bureau. We know there is only one 
official in Government who has any control over the Army and Navy, 
and that is the Commander in Ghief of the Army and Navy. It is 
either his problem or the problem of those to whom he has delegated 
the power, the Secretary of War or some other official to whom he 
might delegate that power. 

We realize that if we vest power in someone over the Army and 
Navy, and that power isn't correlated with power over the rest of the 
economy, confusion will result. 

Mr. Thomas. That is correct. 

Mr. OsMERS. So now we are getting back again to the word "czar." 
You want more "democratic procedure," to use the softer term that 
the chairman has suggested to me. But what is the answer? 

COOPERATION OF MANAGEMENT, LABOR, AND GOVERNMENT REQUIRED 

Mr. Thomas. I still say that there should be a board set up, repre- 
senting management and labor and government. At the head of the 
board, of course, should be the President of the United States, or his 
designated representative, as chairman. 

Mr. OsMERS. Do you think that the so-called S. P. A. B., which 
the Vice President now heads, is the answer? I read the news- 
papers avidly too, and the newspapers read a great deal more authority 
into this Board than the Board seems to possess. 

Is that the type of board, does it include representatives of the 
elements that you would like to have represented? It is appointed 
by the President. 

S. p. a. B. SET-UP a step IN RIGHT DIRECTION 

Mr. Thomas. No. I think that Board has been a step in the right 
direction, but it is a long way yet from what I think a proper board 
should be. 

Mr. OsMERS. Do you feel that Congress, as the direct representa- 
tives of the people, should specify by law what that board should be^ — 
not the names of those who should sit on it, but the various interests 
that should be represented? 

Mr. Thomas. Yes; I think they should. 



7282 DETROIT HEARINGS 

Mr. OsMERS. Do you feel that if Congress did it, it would have 
more general support among the people of the country? 

Mr. Thomas. That is a very difficult question to answer. The 
President has more support today among the working class in many 
places, than Congress has as a whole. 

Mr. OsMERS. I am aware of that. 

Mr. Thomas. For instance, if any Congressman who voted in favor 
of this last tax bill that was passed had gone out among the working- 
men, he would have found how much influence Congress has; but I 
still think that Congress should set up some board. I know under the 
present set-up in Washington that thousands of representatives of big 
business are being brought into government there, with authority, 
and they are runnmg the show. I was a young man in the last war, 
but I was old enough to loiow something about it, and I read of the 
congressional investigations afterward, and I am afraid the same thing 
is happening today. 

Mr. OsMERS. I am sure it is. 

DEMANDS LABOR REPRESENTATION 

Mr. Thomas. That is, representatives are not representing the 
people of this country; they are representing their own interests; and 
until representatives of the working people are given some authority 
in this matter, that will never be stopped. Individual businessmen 
are going to do the same thing they did in the last war. 

Mr. OsMERS. That is a restatement of the thought that a change is 
needed, but it is of no help to us in arriving at exactly what the change 
should be. You have made a general statement that the working- 
man must be represented. But how should he be represented? Who 
shall appoint the board, and what authority shall it have? 

You say that a lot of individuals have authority. One of our 
functions as Members of Congress is to act as go-betweens, so to 
speak, between our constituents and the Federal Government. But 
I will admit, as a Member of Congress I can't get a "yes" or "no" 
answer. I am not looking for favorable answers on everything, but I 
can't get any kind of answer. 

Mr. Thomas. It seems to me I was clear in my answer. I will try 
to restate it; I will be very frank about it. I would like to give an 
example first. 

Mr. Kjiudsen was called into Washington and given a lot of power, 
and I think in many cases he has failed. Mr. Knudsen represents a 
company which employs about a quarter of a million people — 250,000 
people who are in our organization, and I am the president of that 
organization, with considerably more people mvolved. If I under- 
stand government, government is the people; that is, if the Consti- 
tution stUl prevails. 

Mr. OsMERs. There is some question about that. 

Mr. Thomas. Well, I say, if it still prevails. 

Mr. Osmers. I didn't appoint Mr. Ivnudsen, so that lets me out. 

Mr. Thomas. And I think I want to say for the record, so nobody 
will have any mistaken ideas, that I am not here for the purpose of 
castigating Mr. Ivnudsen. I think he is just about as good as any 
of the other heads of industry. 



NATIO^\\L, DEFENSE MIGRATION 7283 

Mr. OsMERS. That is a heavily qualified statement. 

Mr. Thomas. Well, there are some we get along with better than 
others. That is the reason I qualified my statement. But what 
I mean is, I don't want anybody to get the idea that I am here to 
talk against Mr. Knudsen. I have simply used him as an example. 

Mr. OsMERS. We don't want you to talk against anybody. We 
want you to talk for the purpose of getting an answer to our problem. 

Mr. Thomas. In Washington, business interests have been called 
in. Those men cannot represent the interests of the people of this 
country. I think if labor is called in, and given equal authority — - 
and I don't mean by that boards set up to represent industry with a 
banker and a couple of his colleagues. In that way you always get 
outvoted, jerrymandered around. Labor should have equal repre- 
sentation with industry. Then the problem could be solved. 

Mr. OsMERS. Just a moment, Mr. Thomas. It was my under- 
standing, and it still is, that Mr. Hillman has absolutely equal author- 
ity with Mr. Knudsen — to such an extent that one of our very popular 
magazines always puts the two names together, Knudsen and Hill- 
man, without any division, indicating that they are a sort of two- 
headed animal. 

Now, either Mr. Hillman doesn't have equal authority with Mr. 
Knudsen, or he does. I realize, and I think every competent ob- 
server of the Washington scene would agree, that there are three groups 
tussling for power behind the scenes: Business, labor, and Govern- 
ment. They are engaged, sometimes even to the detriment of na- 
tional defense, in a struggle to control this defense area. Which one 
happens to be in the lead at the moment, I don't know. 

Mr. Thomas. Even though it is said that Mr. Knudsen and Mr. 
Hillman have equal power — and maybe they have 

Mr. OsMERS. That was the President's clear explanation of the 
set-up. 

Mr. Thomas. But you also have a committee set-up there — this 
new committee — and Mr. Hillman is only one man. 

Mr. OsMERS. Right. 

Mr. Thomas. And I am afraid that the Army and Navy repre- 
sentatives are much closer to the representatives of industry than they 
are to the labor representatives. I know that to be a fact. It is 
quite obvious. Everybody knows that retired officers of the Navy 
can get jobs at the Bethelehem Steel Co. if they want them. There is 
a close tie-up there, and that may be the reason Bethlehem Steel gets 
so many orders. I don't know. I am just saying that that may be 
one of the questions to be settled. 

Mr. Arnold. I want to make sure, Mr. Thomas, that you are not 
prejudiced against captains of industry. I don't want to have testi- 
mony here like we had on the floor of the House one day. A Repub- 
lican Member was castigating Harry Hopkins. I have always been 
pretty much of an admirer of Harry Hopkins. But he had me believing 
a little bit about what he was saying, until someone said: "Well, Harry 
Hopkins is about the most inefficient man in Government, isn't he?" 

The reply was: "No. The President of the United States is 
more so." 

Mr. OsMERS. I am not going to argue that point, Mr. Arnold. 



7284 DETROIT HEARINGS 

Mr. Thomas. To try to prove to you that I am not prejudiced in 
that fashion, let me remind you that it has only been a few months 
ago that our organization was in a terrific organizational campaign 
in the Ford Motor Co. I thought the Ford Motor Co. was one of the 
most backward organizations in our industry. But I would like to 
say today that in my opinion the Ford Motor Co. has been the most 
forward company, as far as their planning of this situation is concerned, 
and that their policy has changed 100 percent. 

RECOMMENDATIONS MADE LAST NOVEMBER 

Mr. Arnold. I would like to get back to the charge you make, 
that last November you called to the attention of officials of Govern- 
ment the fact that there should then have been started a change-over 
in existing facilities in the automobile industry for the purpose of mak- 
ing airplanes and producing materials of war. The 8 or 10 months since 
then have been very important months. They might even determine 
whether we have eventually to get into this war. 

Mr. Thomas. That is correct. 

Mr. Arnold. Now, I want to know if you called this to the atten- 
tion of officials who had the power then to make that change-over. 

Mr. Thomas. I met with Mr. Hillman and Mr. Knudsen. 

Mr. Arnold. And you think they had that power? 

Mr. Thomas. Yes, I do. 

Mr. Arnold. And they didn't do it? 

Mr. Reuther. And it was also called to the attention of the 
President. 

Mr. Thomas. It was called to the attention of the President of the 
United States by Mr. Murray. 

need for inventory of material and resources 

The Chairman. Mr. Thomas, the problem that we are discussing is 
a vast and interesting one. I shall take back to Washington the 
thought, among others, that we need an inventory of skills and mate- 
rials and of the various resources of our country. We may not be able 
to do very much until we have such an inventory. We should know 
how much of these materials should go to the Army, how much should 
be allocated to the Navy, and what the surplus is. And perhaps most 
important is the inventory of labor, skilled and unskilled. 

Mr. Thomas. There is no question about that. 

Mr. Reuther. On the question of setting up a new agency in 
Washington, with labor, management, and Government representation, 
I doubt^very much whether the establishment of any single agency in 
Washington, administered from Washington, will be successful. 

subcommittees for every major industry 

This entire job, as it relates to the basic industries in America, 
involves the fundamental requirement that labor has recognized all 
through this 10-month period, and that is the establishment, for 
every major industry, of subcommittees that will deal with the 
specific problems in steel, aluminum, and so forth. 



NATIO^'AL DEFENSE MIGRATION 7285 

It was only a few weeks ago that O. P. M. took the initiative to 
call together nia^iagement, labor, and Government representatives, to 
deal with one particular problem as relates to the automobile industry — 
the question of transfers, and the avoidance of dislocation of labor. 

No one better understands the problems of the auto industry than 
the people who build the automobiles and the management that owns 
and represents own-ership of the automobile companies. Why 
shouldn't we establish in the auto industry a committee of labor, 
management, and Government, that will use the figures to be revealed 
through such a survey? That committee could discuss where dis- 
locations are occurring, where there are available supplies of machinery 
and of plant space and labor, and see to it that the agencies in Wash- 
ington that are going to release the contracts are adequately informed. 
This body also will know and understand how to handle the problems 
created by the pressure groups and by those who would adhere to 
business-as-usual practices; it would do away with abuses through 
personal relationships between the Ordnance Department and repre- 
sentatives of corporations whereby decisions are made as to where 
contracts should be released. Let us do all this on the basis of facts 
that will be revealed from the survey. 

Mr. OsMERS. I think, Mr. Reuther, there is a great deal in what 
you have to say there. We have got to bring order out of chaos, and 
I don't know how you are going to do it unless you have representa- 
tives of all concerned. We don't want to be top-heavy, or weighted 
one way or the other. If that occurs we will defeat the very purpose 
we set out to accomplish. 

Mr. Thomas. That is correct. 

Mr. OsMERs. Mr. Thomas, how many members does your union 
have? 

UNION HAS 556,000 MEMBERS 

Mr. Thomas. We have around 700,000 people under contract. 
Our paid membership runs around, I think, 556,000. 

Mr. OsMERS. How many of those arc in Michigan? 

Mr. Thomas. Between 250,000 and 300,000. 

Mr. OsMERS. And how many of them will be affected by the cur- 
tailment of automobile production? 

Mr. Thomas. Better than 200,000. 

Mr. OsMERs. Is that the total number to be affected? 

Mr. Thomas. Maybe I misunderstood your question. 

Mr. OsMERS. How many of your members, all over the country, 
will be affected by the curtailment of auto production? 

Mr. Thomas. The cut will be close to 50 percent, and I figure that 
practically 50 percent of our membership will be affected. 

STUDY OF four-shift PLAN 

Mr. OsMERS. Now, has your union made a study of the four-shift 
idea, the idea of maximizing the effort and minimizing the man-hours 
lost? 

Mr. Thomas. We have, and we are working on it now. 

Mr. OsMERS. Does it look as though that plan is going to get a 
favorable verdict? 

Mr. Thomas. There is that possibility. 



7286 DETROIT HEARINGS 

Mr. OsMERS. We are very much interested in those people who for 
years have come to Michigan for the purpose of wQ^'king during the 
season, and then returning to their former places of abode. In the 
past, before the defense emergency, a great majority of these out-of- 
State people could be counted on to retm-n when they were needed 
in the new-model season. Now, do you think that in the course of 
any new unemployment period, your membership can be expected to 
remain in Michigan, and if not, do you think they can be counted on 
to return when defense work does open up full blast? 

In other words, how many will you lose during the unemployment 
period, and how many will come back after the unemployment period 
has tapered off? 

FEW MIGRATORY WORKERS IN AUTOMOBILE INDUSTRY 

Mr. Thomas. We don't have very many migratory workers in our 
organization. 

Mr. OsMERS. They are not an important factor in it? 

Mr. Thomas. They are not an important factor in our organiza- 
tion at all. 

Mr. OsMERs. Have you made any estimate of the number of 
workers who are readily transferable to defense jobs — that is, with- 
out further training? 

Mr. Addes. Approximately 50 percent of them would not require 
any training. 

Mr. Osmers. Are you satisfied in general with the present training 
programs that have been established? Do you feel that they are 
adequate? 

PRESENT TRAINING PROGRAMS INADEQU.A.TE 

Mr. Reuther. The present training program is by no means ade- 
quate, in view of the tremendous curtailments that are going to take 
place. 

It is true that we have been able to recruit a considerable number 
of our own membership and enroll them in the vocational training 
programs through the board of education, but their facilities are now 
exhausted, and the training-wi thin-industry program has got to be 
developed to a much larger extent. It must deal in terms of training 
of 50,000 or 60,000 or' 100,000 individuals for speciahzed jobs in 
defense production. 

Mr. Osmers. That answers the question I was going to ask with 
respect to which of the two, three, or four progTams that are gomg on 
is the one that would be most adaptable for enlargement. You 
think it is the training-within-mdustry program? 

Mr. Reuther. Definitely, because they have the equipment there; 
they have the machinery, and that is the thmg that the Board of 
Education lacks at the present time. 

Mr. Thomas. Wliile we are discussing this phase of it, there is one 
thing I might bring to your attention. 



NATIO:yAL DEFENSE MIGRATION 7287 

TRAINING PROGRAMS AND PLANT LOCATION 

This point I brought up originally on the building of that Buick 
plant in Chicago. The Government is spendmg thousands of dollars 
there to break in trainees in that particular plant. Had that plant 
been built in Flint, or available facilities in Flint used, it would have 
been unnecessary to spend that money for a training program. 

Mr. OsMERS. You mean that we are training men in Chicago to 
perform work which could be done by already trained men in Flint, 
while at the same tune these Michigan workers are losing jobs? 

Mr. Thomas. That is so. 

Mr. OsMERS. That doesn't seem to make sense. 

Mr. Thomas. Not only that; they are moving machinery out of 
Flint to Chicago — moving it away from the men. 

Mr. OsMERS. That makes even less sense. Do you think the 
present benefit provisions of the unemployment compensation system 
are adequate to meet the situation now arising? 

PRIORITY UNEMPLOYMENT 

Mr. Thomas. No; I don't. Regardless of what plan you put into 
effect, there is no question but what we are going to have here what is 
known as priorities unemployment. 

It is my personal opinion that in this city, for those who are suffering 
priorities unemployment and who expect some time within the next 
six months to a year to go on national-defense work, there should be 
unemployment -compensation provisions to make the weekly amount 
higher and to stretch out the period of payments. 

Mr. OsMERS. You were not here yesterday when I questioned 
several witnesses about a bill that I have been working on for some 
time. I shall probably introduce it to Congress if it gets a clean bill 
of health from people who know most about those things. 

My proposal has two angles. One applies to the period after the 
defense emergency, when we know that we may have a year or two of 
prosperity, and following that a very hard depression. 

It was my thought that we should extend the period of unemploy- 
ment compensation to at least 26 weeks, if not longer, and that we 
should increase and make more uniform the rates of weekly payment. 

In general, would you say that that is a healthy proposal, a proposal 
in the right direction? 

Mr. Thomas. I would say that it is certainly very fine. 

Mr. OsMERs. If the rates of taxation were increased, as they prob- 
ably would be to make the program eft'ective, do you feel that such 
increase might have, shall we say, an effect of controlling inflation, 
by laying aside a little bit more of the worker's envelope each week, 
which, of course, would be to his credit in the fund? 

Mr. Thomas. I will answer "Yes" to the question, but I would like 
to answer something further than that'. Again I want to bring up 
this last tax bill. 

I think the worker was hit pretty hard in that bill. 

Mr. OsMERS. Because of the lowering of the exemptions, Mr. 
Thomas? 



7288 DETROIT HEARINGS 

Mr. Thomas. That is correct — lowering the exemptions and faihire 
to increase commensurately the tax bill for the manufacturer, for 
industry. 

Mr. OsMERs. Those rates are so confusing, even to the ones who 
have studied them, that it is almost impossible to know what the 
effect will be until after they have gone into operation. 

The Chairman. I am afraid if we enter into a debate as to the wis- 
dom of the tax bill, we will be here for about 40 years. 

Mr. OsMERs. And then not know whether it was wise. 

Mr. Addes. I would like to put forth another suggestion, since 
you are contemplating introducmg a bill that is going to move in the 
right direction as we see it. 

SUGGESTS DEBT MORATORIUM DURING PRIORITY UNEMPLOYMENT 

I think another bill ought to be introduced. It ought to be done 
very rapidly. And that is a moratorimn on rents, automobile pay- 
ments, refrigerator payments, et cetera, for workers who are affected 
by these priorities. Ordinarily, when a man purchases a home, for 
example, and becomes unemployed because of priority unemployment, 
his payments don't stop; they continue, rents, automobile payments, 
refrigerator payments, radio payments, et cetera. Those payments 
must be met on a monthly or semimonthly or weekly basis, and a man 
who becomes unemployed in this manner should be protected by a 
law adopted by Congress, setting aside these interim obligations until 
such time as he regains employment in national-defense industry. 

Mr. OsMERS. Would you say, Mr. Addes, that the form of that 
legislation should follow in general the legislation that grants relief to 
a man who is put in the Army under selective service? 

Mr. Addes. I think it ought to be much stronger. 

Mr. OsMERs. How would you justify making it stronger, consider- 
ing the difference between the pay of the selectee and that of the man 
in industry? 

Mr. Addes. I think the moratorium in effect under the Selective 
Service Act is inadequate. 

WORKERS MISLED BY REPORTS OF LABOR SHORTAGES 

Mr. Thomas. There is something we should point out to you. Last 
year, during the last model in the automobile iDdustry, the workers 
had been told that they were going to have a very prosperous future; 
that there was going to be a shortage of labor. Those stories came 
out of government. The men were told there was going to be all 
kinds of shortages of labor, and as a result, those workers who are 
usually quite cautious about their buying have been misled. The 
average man doesn't go out and buy something that he knows he isn't 
going to be able to pay for. But because of these stories, a great 
number of our workers bought new automobiles, new furniture, radios, 
and washing machines. They were looking forward to this period of 
prosperity. 

Now they have waked up to the fact that the ground has been cut 
out from under them, and many of them, unless something is done, are 
going to lose the things they bought. That is not going to help the 
economy of the country, as I see it. 



natio:nal defense migration 7289 

Mr. OsMERS. I think definitely if the Government is going to dis- 
place men purely through the priorities route, or shall I say the lack 
of materials under the priorities arrangement, some adjustment will 
have to be made. Here the Government is coming in and upsettmg 
the economy and putting a man out of work. 

I understand in Buflalo there was a relatively small number dis- 
placed — I am speaking of automobile workers in that city — but even 
under the favorable circumstances existing in Buffalo, where there is 
an expanding aircraft industry, only a little over a third of your mem- 
bers found employment. 

Mr. Thomas. That is correct. 

BUFFALO PLAN 

Mr. OsMERS. How do you expect the Buffalo plan will work out 
when applied to the Michigan situation ? 

Mr. Thomas. I personally think the Buffalo plan is a very fine plan 
which, if put into operation, would also work in Detroit. But I am 
beginnmg to wonder if the manufacturers— and I have got my fingers 
crossed — even though they said they will go along with the Bufl'alo 
plan, I am wondering if the manufacturers really would do so if a 
larger number of people were unemployed. 

Mr. Addes. Wlien the Buffalo plan was worked out, a group of 
manufacturers got together and agreed. But some did and some 
didn't agree to absorb these people who were qualified to work on 
national-defense projects. 

We have a program here that has been worked out between manage- 
ment and labor. Management didn't wholly accept it but O. P. M. 
finally put it as an order, and with this supplement to the Buffalo 
plan, I believe that the arrangement can be worked out here very 
well — provided, however, that management will cooperate. 

I don't know whether you have seen the five points that have been 
put into eft'ect by O. P. M. as a result of a meeting with management. 

Mr. OsMERS. That was done in a recent conference? 

Mr. Addes. Yes. ^ 

Mr. OsMERS. I wish you would give us a copy of it for our record. 

How many of your workers, Mr. Thomas, have been trained on the 
job for defense work? 

Mr. Reuther. It is very difficult to answer that because so many 
corporations have their own training plan. 

TRAINEES STILL WAITING FOR DEFENSE JOBS 

Mr. OsMERS. How many of your members, if any, have been trained 
for defense work and are still waiting to be transferred from nonde- 
fense work to the defense work? Is there any considerable number? 

Mr. Thomas. No. 

Mr. Addes. Yes. I would say in certain plants there are large 
numbers of men who are awaiting assignment in the defense jobs. 

Mr. OsMERS. You wouldn't be able to give us an exact or approxi- 
mate number, Mr. Addes? 

Mr. Addes. No; it is difficult to do that; but I know of two or 
three plants where the expansion in national defense has not been 
made rapidly enough to absorb those who have already been trained. 

1 See pp. 7495-7496. 



7290 DETROIT HEARINGS 

Mr. Reuther. It was difficult to anticipate just where the ciir- 
taihnent would hit hardest until the December figures were given to 
us, but on the basis of those, we now know in Briggs and Ternstedt 
and in other plants, exactly how many workers will be affected, and 
there we are endeavoring to enroll those workers who will be affected 
immediately, even before the lay-off, in a training program. 

Mr. Thomas. I said, "No" to your question and the other boys said 
"Yes." I want to explain that to you. 

There have been large groups trained, but because of the way you 
put the question, I was figuring on a percentage basis of our total 
membership. It wouldn't amount to over 1 or 2 percent of the total 
membership. 

Mr. Reuther. I understand there have been approximately 30,000 
trained in the city of Detroit through the vocational defense training 
plants, and I believe we are very conservative in estimating at least 
20,000 of those trainees were recruited from our organization and 
referred to the Board of Education. 

Mr. OsMERs. I think that is a tribute to your organization — taking 
the lead in that question. 

U. A. W. POSITION ON PAY FOR TRAINEES 

Has the U. A. W. taken any position on the question of pay for 
trainees while in trainmg? 

Mr. Thomas. We have been negotiating with each corporation. 
What we have been trying to negotiate is full pay for trainees. In 
many cases that has not been accomplished; in some cases it has. 
Our position has been for full pay. 

Mr. Curtis. I was mterested in your illustration of the factory 
that was placed at Chicago when, as you suggested, it should have been 
located at Flint. 

OPPOSES DECENTRALIZATION 

Do you favor a program to decentralize the entire defense activity 
and cany some of it out to agricultural and rural areas? 

Mr. Thomas, The way it is going, I think it is just about the silliest 
thing that I have run up against. 

Mr. Curtis. Wliat is? — the centralization or the agitation for 
decentralization? 

Mr. Thomas. Putting large plants out in corn fields or in sandy 
deserts is silly. It is just ridiculous, in my opinion. 

Mr. Curtis. In other Avords, you do not favor any of this agitation 
for further decentralization? 

Mr, Thomas. That is correct. 

AGRICULTURAL REPRESENTATION 

Mr. Curtis. Now, on this board that you suggest, of labor, man- 
agement, and government, would you give agriculture a representative? 

Mr. Thomas. In industrial production agriculture should not have 
any representative. Where farmers are involved, they should have a 
board of their own, on which industry and labor would not be repre- 
sented. 

Mr. Curtis. Well, they have got more boards now than they have 
farmers, but I refer to this super board that runs the show. 



NATIONAL DEFENSE MIGRATION 7291 

'Mr. Thomas. Oh, certainly; I certainly do. The farmer should be 
represented there. 

DISCUSS DEBT MORATORIUM 

Mr. Curtis. In reference to the moratorium that you suggested, 
would you confine that moratorium merely to the industrial worker, 
or would you extend it to the busmessman himself, the retailer — and 
he is scattered the length and breadth of the country — who will be no 
longer in business because he cannot get materials? Are you going 
to give him a moratorium against his debts, including his wholesale 
bills? 

Mr. Addes. To be perfectly frank with you, I have never looked 
at it from that angle. I was primarily interested in the workingman. 

Mr. Curtis. Would you extend it to the farmers when it doesn't 
rain? 

Mr. Thomas. I was speaking of ''priorities unemployment." 
When it doesn't rain, I don't think we can blame that on the Govern- 
ment. 

Mr. Curtis. Well, but we do. 

Mr. Arnold. Some people do. 

Mr. Curtis. It swings lots of elections. But would you extend 
your moratorium to the businessman himself, the retailer particu- 
larly? 

Mr. Thomas. I think you would have to do so, for the retailer 
particularly. 

Mr. Curtis. And his individual salesmen as well? 

Mr. Thomas. That is correct. 

Mr. Curtis. I am thinking of many automobile agencies that are 
out in areas where there is no chance to transfer to any defense 
activities. They will just be closed up. But you are going to need 
them, you are going to need that system to distribute your products 
when you go back to automobile production. 

increased profits to automobile workers 

Mr. Wish ART. As you may know, prices on cars are being increased this 
year, not only the manufacturer's price, but the dealer's price, through 
his reduction in the allowance on second-hand cars. That means that 
the dealer's discount or profit on a single car sale will be increased. 
Under the curtailment, the total number of cars sold will be consid- 
erably smaller than last year. At the same time, the profit per car 
being higher, many dealers will be able to make out on that basis. 

Mr. Curtis. But the extra profit is not sufficient to take care of 
them. 

Mr. WiSHART. It is hard to estimate exactly, but according to Ward's 
Report, showing the actual price increase to the average purchaser of 
a car will amount to about $200 or $250, making allowance for the 
reduction in your trade-in value on a second-hand car. I should say- 
there is going to be adequate provision for the dealer himself. 

SALESMEN AFFECTED BY AUTOMOBILE CURTAILMENT 

Now, for the automobile salesmen you might find the situation 
somewhat difl'erent, because the necessity of the salesmen will be con- 
siderably reduced by large buying power, met by comparatively 



7292 DETROIT HEARINGS 

small power to produce automobiles; so I think the problem there does 
not involve the retailer, but his employees, and I certainly believe 
that some provision should be made to transfer these men to jobs 
which will allow them to maintain their position in our economic set-up. 

Mr. Thomas. The automobile salesmen will perhaps be hit hardest 
or as hard, as any other group in the country. There is going to be 
such a demand for automobiles that the retailers won't need any 
salesmen. 

The Chairman. With reference to the moratorium on debts of 
retailers and employees and one thing and another, I assume you are 
not taking as a precedent the moratorium that was placed on the 
debts of foreign governments following the first World War. 

Mr. Thomas. W^e are not asking that our debts be canceled per- 
manently; we are not asking Congress to scale our debts down. All 
we are asking is time to pay them. 

The Chairman. The Frazier-Lemke bill on real-estate mortgages 
was based on that premise, was it not? 

Mr. Thomas. Yes. 

FURTHER SUGGESTIONS FOR DEBT MORATORIUM 

Mr. Reisinger. I think the moratorium should extend to all of 
those who are affected by priorities unemployment. If our workers in 
the automotive plants lose their jobs, that unemployment in turn 
affects others, the salesmen in the field, the small retail stores. 

For instance, in Flint, which is strictly an automotive town, if the 
large percentage of those people can't purchase, it must make a prob- 
lem for the retail stores there. 

I think consideration should be given to the businessman. I think 
this matter of moratorium is very important to the whole set-up of 
defense. Morale in our country is all-important in time of emergency, 
just as it is in the Army or the Navy. I think if we have this unem- 
ployment, people will begin to lose their morale if they are faced with 
a lot of debts and foreclosures on their homes and other, purchases. 

Mr. Curtis. I have no further questions, but I have this request to 
make of you gentlemen: If in your work and your research you should 
happen to find who is in charge of the defense program at Washington, 
or any detailed part thereof, I will be glad to know it. 

Mr. Thomas. And if you find out, will you let us know also? 

Mr. Curtis. I was sent around from 1 department to another on 
about 12 different errands 1 day, and it ended up with the last fellow 
suggesting that I make the inquiry of my local chamber of commerce. 
It so happened that that was where I got the original inquiry. 

UNDEREMPLOYMENT ON DEFENSE CONTRACTS 

Mr. Addes. Let me go back one moment to the question of labor 
shortage. It has been said that there is a labor shortage on the one 
hand, and on the other hand it has been stated that there is a great 
volume of contracts. But the direct effect of these contracts on 
actual employment is often exaggerated. For mstance in General 
Motors, out of some 210,000 employees, there are only approximately 
45,000 working on national-defense production at the present time, 
which I think is mterestmg m the light of the ballyhoo, or the propa- 



NATION.\I. DEFENSE MIGRATION 7293 

gancla, I should say, that is emanating out of some agencies from which 
the daily press carries statements that there is a shortage in labor. 

Management has made that statement, and these same agencies 
are carry mg on the propaganda that there is a great deal of national- 
defense work left to be done; yet you find a corporation as mighty as 
General Motors with only 45,000 people employed on national 
defense. 

Mr. Thomas. I filed a brief or statement with the committee. 
I have an additional statement on what is happenmg to housing here, 
from the point of view of a student of migration. Will it be permissible 
to file that with the committee later? 

The Chairman. Mr. Thomas, our record will be held open for at 
least a couple of weeks. If there is something that occurs to anyone 
in this panel, supplemental to what has been testified or brought out 
in the hearing, we will welcome such information as a part of the 
record. 

Mr. Arnold. I just can't let one or two statements go unchallenged. 
I was going to say to Congressman Curtis that we Democrats don't 
have any trouble getting all kinds of information in Washington. 

Mr. OsMERS. Wliat do you mean by "all kinds" — good and bad? 

Mr. Arnold. I was going to ask a question of Mr. Thomas, in view 
of the fact that he is opposed to the decentralization of defense 
industries. I come from Illinois, and I haven't said anything about 
the Chicago plant. I live farther down in the State. But I have in 
mind the big shell and bomb loading plant being constructed at 
Herrin, drawing upon an area of about five counties. Those counties 
have been heavy coal producers, but the coal is mined out. As a 
result, there have been some 30,000 unemployed there ever since 1930. 
This shell and bomb loading plant was placed there to employ those 
men. Otherwise they never would have been employed unless they 
migrated to some other State, and that is what this committee is 
trying to prevent. 

Now, would you still say, in view of that, that these plants should 
be centralized and further congested in the areas you speak of? 

SHOULD LOCATE PLANTS WHERE LABOR IS AVAILABLE 

Mr. Thomas. No, no. I don't want my statement misunderstood. 

I said people who do the kind of work that is done in our particular 
industry should not be forced to move to some little jerkwater town 
in Oklahoma. 

Mr. OsMERS. Or a little jerkwater town in Nebraska. 

Mr. Thomas. In the particular situation you are talking about, 
you have an unemployment problem there. It is necessary, as you 
said, for those people to have some kind of work, and this plant you 
mention is not for the purpose of curing priority unemployment. It 
is a new kind of work altogether. 

Mr. Arnold. In other words, you would say industries in that 
classification should be dispersed and placed in areas that have 
unemployment. You would apply this to industries that do not 
require special skills? 

Mr. Thomas. Yes; and not only that, but also industries that don't 
require the importation of people into the area. The industry you 
are talking about will not need to import people. 



7294 DETROIT HEARINGS 

Mr. Arnold. But you think the buildmg of airplanes should be 
further concentrated in areas where the skilled labor is already 
available? 

Mr. Thomas. Yes. 

Mr. Arnold. Well, I don't object to that. 

The Chairman. I want to say to you gentlemen that we hope we 
have not given you the impression of tiying to curtail your dis- 
cussion. But we have a heavy schedule, and we have to get back to 
Washington to save the Nation. We have that problem on our 
shoulders. 

We want to thank you very much for your valuable presentation 
here today, and if there is anything else you care to put in the record, 
you may forward it to the committee in Washmgton. 

Air. Thomas. And we thank you for the courteous hearing we 
have had, Mr. Chahman. 

The Chairman. Commander Eade is our next witness. 

TESTIMONY OF IT. COMDR. WALTER F. EADE, UNITED STATES 
NAVAL RESERVE, INSPECTOR OF NAVAL AIRCRAFT, UNITED 
STATES NAVY, DETROIT, MICH. 

The Chairman. Commander Eade, will you take the seat there? 
Congressman Arnold will interrogate you. 

We appreciate your coming here very much. 

Mr. Arnold. Will you state your name for the committee, and 
the capacity in which you appear here? 

Commander Eade. Lt. Comdr. Walter F. Eade, United States 
Naval Reserve, inspector of naval aircraft in Detroit. 

Mr. Arnold. You have submitted a statement. Commander Eade^ 
that will go into the record in full. 

(The statement referred to above is as follows:) 

STATEMENT BY LT. COMDR. WALTER F. EADE, UNITED STATES 
NAVAL RESERVE, INSPECTOR OF NAVAL AIRCRAFT, UNITED 
STATES NAVY 

The defense program in its enlarged scale has created many problems having 
to do with both manpower and materials. Some of these problems are extremely 
difficult to deal with easily, particularly that of manpower. In the case of ma- 
terial, the problem is of vast proportion but has one advantage, namely that the 
"capacity of production" is tangible. The disposition of the mateiials of this 
production capacity, although a tangible factor also, becomes much more diffi- 
cult to adjust to defense needs than that of production because of the displacements 
of manpower required from nondefense to defense work. 

Productive capacity, with respect to basic materials required for defense work, 
has been stepped up materially by a corresponding step-up in plant capacity, that 
is to say a plant operating formerly at 50-percent capacity steps up to 100-percent 
capacity with the attendant increase in man-hours. To implement this step-up 
further required an addition of both manpower and plant facilities. 

How to acquire the addition of manpower becomes a problem of transition of 
available labor from nondefense to defense work with the least disruption to 
invested capital in nondefense production. The curtailment of certain non- 
defense production can supply manpower direct to defense production in specific 
fields as in the manufacture of tanks, ships, machine tools, jigs, and fixtures and 
probably a large amount of ordnance material. 

The above transition should be accomplished with the least disruption to those 
nondefense manufacturers who have the type of labor and have been producing 
durable goods of similar nature to defense requireinents, as referred to above. 
Attention should be drawn to the fact that in certain manufacturing centers 



NATIO:SA.L DEFENSE MIGRATION 7295 

where these durable goods are produced there will appear very little migration of 
workers. 

Cognizance should be taken, however, to the need for orderly curtailment of 
nondefense production whereby manpower can be shifted in direct proportion to 
curtailment of the use of basic materials which are needed for defense production. 
In other words, "a tapering off of nondefense production and tapering on of 
defense production commensurate with the requirements of materials and facil- 
ities." The correlation of these factors is of prime importance to both labor and 
the materials question, 

FACTORS IN SUPPLYING AIRCRAFT LABOR NEEDS 

In the case of supplying the labor demands for accelerating production of air- 
craft, aircraft accessories and the like, except aircraft engines, the problem be- 
comes one which is extremely difficult. The problem, as a general one, contains 
several factors, among which are: 

(a) The lack of nondefense labor market from which to draw qualified personnel. 

(6) That aircraft production facilities in most instances are not located in areas 
of large labor markets. 

(c) That by virtue of (a) above labor must be trained. 

(d) That by virtue of (6) above migration of potential labor must result. 
One vital deficiency factor appears obvious from the above, to wit: That such 

labor as is or could be made available by curtailment of nondefense production 
cannot, by a large percentage, be either migrated or shifted to aircraft production 
without being put through a training period. A minimum training period of 3 
months appears necessary before this group of workers is sufficiently indoctri- 
nated to place them in the production line. 

Again, cognizance must be taken of the curtailment of nondefense commensu- 
rate with a step-up in aircraft defense production to the end that an orderly 
process may result. Correlation of the curtailment of nondefense work as to 
materials available, training period requirement for airci'aft workers, and the rate 
of absorption of these trainees into aircraft production together with availability 
of materials and plant facilities, must be made if a labor disruption is to be 
avoided. 

Experienced aircraft workers have been in the past migratory to a large extent, 
moving about with the allocation of contracts by the services, and in later years 
due to an impetus in commercial aviation. The transition of nondefense indus- 
tries to defense aircraft production creates the need for experienced key personnel. 
Such personnel can only be requisitioned from the old line aircraft manufacturers. 
Migration must necessarily follow in that an infiltration of experienced workers 
must be made available to assist in directing these nondefense industries to get 
under way, thereby accelerating the much needed aircraft program. 

Aircraft production may be compared to automobile production within very 
narrow limits. Except for the difference in materials used, punch presses, dies 
(blanking and forming) are identical operations applied to sheet stock. The 
finishing of forgings and castings is more closely allied to the rquirements of auto- 
mobile engine parts. Due to the need for holding down weight in aircraft con- 
struction, thus utilizing the material to its ultimate strength-weight ratio, the 
required workmanship is more meticulous. This applies to all faying surfaces 
designed for motion, such as parts of the control system, landing gears, wing 
attaching bolt fittings, most of which are highly stressed forgings of steel or 
aluminum alloys. 

In this connection both men and machines must be capable; the machinist 
must work to closer limits and the machine must be satisfactory for the finer work. 
Automotive experienced personnel can be adapted to this type of work, with very 
little if any training. However, the body worker in general must be trained in 
the handling of both materials and tools applicable to the aircraft type of work. 

BREAK-DOWN OF WORK IN AIRCRAFT MANUFACTURE 

Some idea of the break-down of the classifications of work in the aircraft labor 
field is indicated by the following cla.sses: 

(n) Sheet stock, "cutting and forming: Press work (mechanical dies), hand work 
(hand forming over wood forms), routing (cutting by machine routers), blanking 
(cutting by dies). 

(6) Forgings, castings: Machine work, high grade. 

(c) Fabrication: Riveting (by machine liveters), riveting (by hand tools). 

(d) Special processes: Heat treatment (very rigid control) finishes, paints, 
spraying. 

60396— 41— pt. 18 16 



7296 DETROIT HEARINGS 

(e) Fabric: Application of fabric preliminary preparation of fabric for painting 

Classes: (a) Training insofar as more care in handling materials for aircraft 
than in automotive; (6) greater accuracy in machine finishing; (c) requires ex- 
tensive training in the handling of all tools required; (d) requires extremely close 
supervision and general instructions; (e) application of fabric requires some skill 
(women are best suited for this work and can be trained quickly). 

(Note. — All finishing requires trained personnel.) 

One of the factors causing delays in aircraft production is basic design. The 
underlying reason being that those airj)lanes for which production is desired are 
for the most part not entirely adaptable to mass production as the automotive 
field views the problem. In addition, the subcontractor as the automotive field 
becomes in general, finds the need for creating changes in design to make certain 
parts adaptable to mass production, such changes should be welcome. 

Changes in design brought about by studies from actual combat sometimes are 
of absolute necessitv, whereas improvements of a general nature may be incor- 
porated with slight delays of production to the present types, thus permitting a 
certain frozen production standard. Changes of absolute necessity, such as 
armament equipment usually result in a modified design and may become serious 
factors retarding the acceleration of the mass production program. 

Another inevi'table delay in getting under way is the interim required between 
the time a design is frozen and production due to the tooling time requirement. 
Along with this tooling time it should be noted that mass production for aircraft, 
comparable to automotive production, requires a finer break-down of subassembly 
operations with its attendant increase in jigs and fixtures. 

Although the subject of design changes is controversial as to where to stop, the 
automotive field is concerned only with conditions bearing on volume production. 
Again the automotive industry requires, as in their automobile production, rigid 
time schedules and the stabilizing or freezing personnel to fixed duties. These 
requirements cannot be attained under constant changes in design except as minor 
changes are dictated by production methods and wherein such changes are not 
altering the strength factor. , 

Since it is admitted that skilled labor is not available, the reservoir of persons 
"able and willing" must come from nondefense production and to a large measure 
must be trained. True it is that schools of one sort or another have been set up 
to train aircraft workers, but such training must be implemented by additional 
training on the type of work for which the person will be assigned. 

In conclusion, "it can be said that practically all mistakes made in the production 
line-up are due to inadequate familiarization with the seriousness of such mistakes 
and inadequate training of personnel. 



TESTIMONY OF LT. COMDR. WALTER F. EADE—Resumed 

Mr. Arnold. In what basic respect does aircraft prodiiction differ 
from ordnance or automobile production? I realize that is a double- 
barreled question. 

TWO CATEGORIES OF AIRCRAFT PRODUCTION 

Commander Eade. Aircraft production divides itself into probably 
two distinct categories. 

In the first place the aircraft division handhng the power plant and 
machineable accessories is comparable in a large measure to the 
automobile engine or machine products department; whereas the 
fabrication of the major portion of the airplane— the wings, the tail 
surface and body — is not comparable to body construction for auto- 
mobiles, nor any phase of it. , • <• i 

Mr. Arnold. Can you tell me to what extent acceleration of the 
aircraft production program in the Detroit area has caused an influx 
of workers? 

Commander Eade. I can't answer that question with hgures. 
I do not have any information available. 



NATIONS AI. DEFENSE MIGRATION 7297 

However, there has been some influx of aircraft people from other 
plants, i. e., other old line companies. 

That applies to the Briggs Manufacturing Co., the Murray Body 
Co., and probably Hudson also, to some extent. I don't know exactly 
how much.^ 

Mr. Arnold. Has this been a healthy migration, from the stand- 
point of availability of aircraft workers? 

Commander Eade. I can't answer. I think it is a necessary step. 

Mr. Arnold. In your paper you state there is a shortage of skilled 
labor. What effect is this shortage having on aircraft production? 

SHORTAGE OF SKILLED AERONAUTICAL LABOR 

Commander Eade. It appears to me that the shortage of technical 
and qualified aeronautical help seriously hampei-s the ahcraft-produc- 
tion program. The production methods in aircraft are not comparable 
to those of automobile production. 

Mr. Arnold. Assuming that the cut in automobile production wijl 
release considerable numbers of skilled and semiskilled workers to the 
labor market, can these workers be absorbed immediately by the air- 
craft industry? 

Commander Eade. No. 

Mr. Arnold. You heard the testimony of the other gentlemen this 
morning? 

Commander Eade. I heard part of it; yes. 

Mr. Arnold. Have you any comment to make? 

AIRCRAFT WORK REQUIRES SPECIALIZED TRAINING 

Commander Eade. My only comment is that ahcraft work is such 
that the majority of it requires specialized training, even if it is train- 
ing of only short duration. 

The entire subject is quite controversial, and all one can do, I 
believe, is consider details. For instance, a machinist operating on 
automobile engines may be immediately transferred to comparable 
work in aii'craft-engine manufacture, but the tolerances, the limits 
within which he is required to work, are closer in most instances 
than in automobile work. Therefore, he has to have some supervision 
and must learn a more careful teclmique. 

For work on aircraft materials, aside from the engine, the auto- 
mobile worker must go through a training period of not less than 3 
months to bring him to fixed duties. 

In other words, the production system in the automobile field re- 
quires an individual worker to be trained for fixed duties. Now, that 
same system can be applied by companies in the aircraft production 
field, provided they have trained personnel or provide a training 
period within which to accommodate that purpose. 

Mr. Arnold. You heard the testimony concerning the suggested 
conversion of automobile plants If^st November instead of now. 
Would you have any comment to make as to why that was not done? 

Commander Eade. Primarily, the equipment and facilities are not 
adaptable to aircraft production in general. 

Mr. Arnold. Then you think the project of the Government in 
establishing a plant in Chicago to construct engines has been effi- 
ciently planned, that it has not been a wasted effort? 

' See letter from AVarren F. Bow, p- 7662. 



7298 DETROIT HEARINGS 

Commander Eade. My ofi'hand thought would be that it hasn't 
been wasted effort. I think it is necessary. 

Mr. Arnold. Have you any comment to make on the faihire of the 
Government to utilize the surplus of tool makers and die makers, 
mentioned here this morning? 

Commander Eade. Tool makers and die makers are valuable 
assets to aircraft production. 

I am constantly reminded that many of the managements of the 
various plants say they cannot get them. The reason behind that I 
would not know. 

Mr. Arnold. You believe that the system of training which is 
already established in many aircraft plants will have to be consider- 
ably expanded, and that the men will have to have that training even 
though they may have been skilled automobile workers? 

Commander Eade. May I ask a definition of your phrase, ''skilled 
automobile workers"? 

Mr. Curtis. One who belongs to the union. 

The Chairman. Will you answer that question, Dr. Lamb? 

ABSORPTION OF SKILLED WORKERS 

Dr. Lamb. I assume the reference is to the skills that have been 
discussed here — those of tool and die makers. 

Commander Eade. Tool and die makers can be directly absorbed. 

Dr. Lamb. People with machine tool and die making and possibly 
pattern-making experience. 

Commander Eade. That is right. 

Mr. Osmers. You wouldn't consider a man who had been working 
on an assembly line, and who could be trained in a period of only 2 days 
to 2 weeks, as a skilled auto worker? 

Commander Eade. No, sir. 

Mr. Arnold. Assuming that supervisory or key personnel are re- 
leased by reason of automobile production curtailment, can these 
men's services be utilized at once? 

Commander Eade. Yes, sir. 

balancing labor conversion 

Mr. Arnold. Concerning the transition period from nondefense to 
defense production, you state in your paper, and I quote: 

There is need for orderly curtailment of nondefense production whereby man- 
power can be shifted in direct proportion to curtailment of the use of basic mate- 
rials which are needed for defense production; in other words, a tapering off of 
nondefense production and a tapering on of defense production commensurate 
with the requirements of materials and facilities. 

Will you elaborate on this point? 

Commander Eade. Let us go back to my reference in this paper to 
subcontractors. At the present time, for the production of aircraft, 
it takes considerable time to rehabilitate an automobile plant. It 
takes considerable time to build jigs and fixtures necessary for the 
assembly of machinery to make the dies necessary- for stamping out 
the parts; it takes quite a lot of time to get the materials, because of 
the priorities set-up. The subcontractor takes the priority of the 
prime contractor by an extension. He in turn extends that to the 
suppliers of the raw materials. It takes time to build up a backlog: 



NATI0^\4L DEFENSE MIGRATION 7299 

of material sufficient so that the manufacturer can release a quantity 
of material for the production of a given number of units. You can't 
just take one sheet of material and knock out one piece and say, 
"We are starting into production." Because you are not. You are 
releasing maybe 250 for the first crack on the die. Right or wrong, 
you are starting that way. 

EFFECT OF CHANGES IN BASIC DESIGN 

Mr. Arnold. What effect do changes in basic design have on the 
types of skills required in aircraft production? 

Commander Eade. I don't think that subject has any bearing on 
the type of skills. It is merely a question of delays in getting into 
production of a particular design. 

Mr. Arnold. Aircraft design is undergoing constant changes as a 
result of observations of the present war, is it not? 

Commander Eade. That is right. 

Mr. Arnold. But the skills required in manufacturing are not 
affected? 

Commander Eade. The skills are not involved at all. 

Mr. Arnold. Those are delays that are unavoidable? 

Commander Eade. Yes, sir. 

PROBLEMS INVOLVED IN DEFENSE OPERATIONS 

I should like, for a moment, to go back to the curtailment of non- 
defense operations. That should certainly be commensurate with 
the increase in productive capacity of the aircraft or defense indus- 
tries; otherwise, you would get this interim to which I referred in 
my paper, of curtailment of automobiles and a simultaneous step-up in 
aircraft, during which time you can't use the people because they are 
not sufficiently trained. In the second place, you haven't got the 
plant facilities available. And in the third place, you haven't got 
the materials available at the plants. 

Mr. Arnold. In the conclusion of your paper, you state, and I 
quote: 

Practically all mistakes made in the production line are due to inadequate 
familiarization with the seriousness of such mistakes and inadequate training of 
personnel. 

Wliat do 5^ou consider to be the answer to "inadequate familiariza- 
tion with the seriousness of such mistakes"? 

Commander Eade. Step-up of the training program and the 
definite need for the training program prior to putting these people 
on the production line. 

The Chairman. Commander Eade, we have heard in Washington, 
and we have also heard here, a complaint that the Army and the 
Navy are stormg up unnecessary surplus materials to the prejudice 
of nondefense industries. Do you know anything about that, of 
your own knowledge? 

Commander Eade. I have heard those rumors, but I personally 
don't understand your question fully, as to whether the Army and 
the Navy, as services, are doing it, or whether the manufacturers, 
under the control of the Army and Navy contracts, are doing it. 



7300 DETROIT HEARINGS 

The Chairman. We didn't break it down; we heard simply that 
the Army and Navy were purchasing unnecessarily large stocks of 
materials and storing them up as surplus to the prejudice of non- 
defense industries. 

NO DIRECT PURCHASING BY ARMY AND NAVY 

Commander Eade. In the first place, the Army and the Navy do 
not purchase materials for either prime or subcontractors except in 
the case of such activities as navy shipyards, arsenals, and so forth, 
whereas the private contractors purchase materials as required for 
their use. Materials furnished by the Government to airplane manu- 
facturers comprise such items as engines, propellers, instruments, 
armament, tires, and tubes procured by the services of other sources. 

The Chairman. Commander Eade, did you read the story concern- 
ing this practice in the last World War, in 1917 and 1918, when 
5,000 typewriters were on hand? 

Commander Eade. It sounds a little familiar to me. 

The Chairman. How did they get those typewriters? 

Commander Eade. (No response.) 

The Chairman. I am not saying the story is true. Commander. 

Mr. Curtis. You were not in charge of the purchase of typewriters 
at that time, were you? 

Commander Eade. Thank goodness, I was not. 

Mr. OsMERS. There are so many rumors running around the country 
now, rumors of shortages of material, real or imaginary, that we are 
trying to clarify this whole situation. One unusually persistent story 
is that some firms have made it their business to get one or two minor 
defense contracts — minor in comparison with the size of their opera- 
tions — and using that priority to get a lot of material for their normal, 
nondefense business. 

Commander Eade. I wouldn't doubt that there is a tendency for 
certain manufacturers to try that. However, I have to authenticate 
all preference rating certificates, for contracts under cognizance of my 
office, and the materials that I see on that list must be applicable to 
the contract. 

Mr. OsMERs. And in quantities? 

Commander Eade. And in quantities requested on purchase orders 
for a stepped delivery. If they want 100,000 yards of webbing for 
parachutes, they cannot get that as of a certain date; they must set 
forth a natural requirement, which would keep their production line 
going. 

Mr. OsMERS. Based on their operation? 

Commander Eade. Exactly. So they have, say, a 30-day backlog 
of materials, at the very least, and possibly a little more. 

in-service training 

Mr. OsMERs. You told Congressman Arnold and the committee 
that you thought that a vastly stepped-up training program was 
necessary. I wonder if you would care to tell the committee which 
of the various training programs seems to be producing the best 
and quickest results. 



natiOjMai, defense migration 7301 

Commander Eade. That is a little difficult. The only training 
program with which I am familiar at the present minute and that 
I have any direct contact with is the one at Briggs. 

Mr. OsMERs. That is training-within-industry? 

Commander Eade. It is training-within-industry. They use simi- 
lar materials, parts, jigs and fixtures, and are trained for a period of 
6 weeks, I believe it is, before they are shifted to the production line. 

Mr. OsMERS. Is that training plan working? 

Commander Eade. It is. 

Mr. Osmers. From your observation of the one plant with which 
you are familiar, would you say that that training program could be 
expanded a great deal over what it is today? 

Commander Eade. In my experience of the past year in this pro- 
duction through the automobile field — that is, production of aircraft 
through the automotive field — I feel that the Briggs plan is very satis- 
factory, and it is the most likely that I know of to produce the desired 
results in the shortest length of time. 

Mr. Osmers. I am talking now about expansion of the Briggs plan. 

EACH PLANT SHOULD CARRY ITS OWN TRAINING PROGRAM 

Commander Eade. It should be expanded, but I think each plant 
should carry on its own training program. 

Mr. Osmers. I certainly think so, too. I don't think we ought to 
try to train them all in one plant; but could the Briggs progi-am be 
expanded? 

Commander Eade. Yes, I think it could, and I think they are taking 
steps along that line. They are prepared now, I believe, to train 250. 

Mr. Osmers. Has there been any difficulty, conflict, confusion, or 
competition in the procurement of aircraft because of the fact that we 
have an Army Air Corps and a Navy Flying Corps? 

Commander Eade. May I ask how far in procurement? I just 
don't understand all the possibilities of "procurement." I can answer 
part of the question. 

NO COMPETITION BETWEEN ARMY AND NAVY 

Mr. Osmers. We have four air forces in the United States; but two 
of them are major, the Army and the Navy. They are both procur- 
ing their own airplanes and materials. Has there been any competi- 
tion between the two for the use of these facilities and materials? 

Commander Eade. I don't believe so. 

Mr. Osmers. It has not been evident to you? 

Commander Eade. I thmk the Jomt Boards of the Army and Navy 
work together very closely in the allocation of contracts. 

Dr. Lamb. In his testimony here yesterday, Major Gardner of the 
Air Corps, Procurement Division, testified that in his estimation 8U 
percent of the workers in the automobile mdustry could be success- 
fully transferred, either directly or after further trainmg, to the air- 
craft industry. That doesn't quite correspond to your testimony 
earlier, I would think, although I would like to have you comment 
on it. 



7302 DETROIT HEARING;? 

Commander Eade. I don't believe that I went into any figures. 

Dr. Lamb. No, but you suggested that required slvills were high, 
and consequently the problem of securing them was difficult. 

Commander Eade. I specifically divided it into two classes, those 
who were in the automobile field primarily operating machine tools, 
such as machinists, doing comparable work on engmes, and those who 
were doing comparable work in other parts of the shop. 

Dr. Lamb. Yes. 

Commander Eade. Those who were doing similar types of work in 
parts of the shop other than engines can be transferred directly. 

Those who go into the assembly of aircraft must have training, but 
what the percentage is, I don't know. 

Dr. Lamb. I am asking with respect to the length of training neces- 
sary to turn out a man useful to the aircraft industry. This, you see, 
directly concerns the work of the committee. If the proportion of 
eligible automotive workers is small, the number of unemployed will 
be very large. 

REQUIRES THREE MONTHS' TRAINING 

Commander Eade. That is right. I intimated in my paper that 
about 3 months of training would be necessary, and I was accounting 
for some of the skills that are not easily developed. 

Dr. Lamb. In the training-wi thin-industry program, which you 
prefer as the most efficient, would 3 months still be the minimum 
period? 

Commander Eade. That is right. 

Dr. Lamb. Proceed. Your testimony is perhaps not at variance 
with that of Major Gardner. 

Commander Eade. Not at all. 

Dr. Lamb. Conceivably 80 percent could be trained, if they are not 
already sufficiently skilled, for the tasks in the aircraft industry? 

Commander Eade. I don't want to contradict Major Gardner, but 
I don't know what the percentage would be. I simply divided the 
workers in two general groups, and I still insist that that condition — 
lack of experience — exists and must be corrected. 

Dr. Lamb. Perhaps the question at issue is how many tasks are 
involved in the aircraft industry requiring long experience in the 
operation performed, and how many could be taught in a training- 
within-industry progi-am, within a period of, say, 3 months' maximum. 
Have you any estimate of that? 

Commander Eade. You are getting me back on a figure now, and 
hazarding a guess, which is a little difficult. 

Dr. Lamb." Would you say 90 percent of the tasks could be done 
only l3y men who are skilledover a long period, say 5 years? 

Commander Eade. Oh, no. 

Dr. Lamb. I am trying to get some basic conception of the problem. 
From what you previously testified, I could assume, you see, that 
only men of 5 years' experience could conceivably be used m the air- 
craft industry. 

Commander Eade. I see what you are driving at, but I don't know 
how to answer you without a break-down of these operations. Let 
me cite one example. To drive rivets m aircraft work, a man must 
have at least 3 months' experience. 

Dr. Lamb. I understand that. 



NATIONAL DEFENSE MIGRATION 7303 

Commander Eade. If he is given fixed duties, as done in the auto- 
motive field, and if that same type of procedure is adopted by mass 
production in aircraft, then he will be trained in specific duties. 

Dr. Lamb. But even without adoption of that automotive pro- 
cedure, he could be so trained, could he not? 

Commander Eade. Yes. In a frozen job. 

Dr. Lamb. Given normal aptitude, or perhaps superior aptitude, he 
could be trained in 3 months? 

Commander Eade. Yes, sir; the average automobile worker could 
be trained in 3 months to do the job that some workers in the aircraft 
field have been doing for ] years. 

VALUE OF INVENTORY OF THE SKILLS REQUIRED IN AIRCRAFT INDUSTRY 

Dr. Lamb. That is what I am getting at. A break-down of opera- 
tions of the aircraft industry as a whole ought to be possible, according 
to the number of people required in various operations, and the degree 
of skill, measured in terms of the period of time required to train, plus a 
certain aptitude, qualifying the man for that task. 

In other words, you could make up a schedule for the entire aircraft 
industry, let us say for a certain type of plane, and break it down 
according to skills, and go ahead with your inventory of skills and the 
transference of these men from one industry to another, through 
schooling. 

Commander Eade. That is right. 

Dr. Lamb. Then if you have, let us say, 275,000 unemployed in the 
automobile industiy throughout the country, about what proportion 
of those men might be transferable to aircraft under the proper 
organization and training? 

Commander Eade. Transferred directly? 

Dr. Lamb. I am not asking you to give me a figure. I just want 
an indication. Is it as low as 10 percent, or do you suppose 50 percent 
or more might be transferred? 

Commander Eade. I don't know. I could answer that only if 
you can tell me how many people are in the automotive field, doing 
machine work on engine construction in the shops. I would say that 
group can probably be transferred as required. 

Dr. Lamb. They can be immediately transferred, certainly, biit we 
are not talking about that group. We are talking about the training 
program, and the workers who would be transferred through its 
operation. 

ESTIMATES 90 PERCENT NEED TRAINING 

Commander Eade. I would say 90 percent of them will have to 
be trained. 

Dr. Lamb. I agree with that. I am asking first, how much train- 
ing is required, and second, how large a proportion of the displaced 
automotive workers could be trained and actually transferred. 

Commander Eade. I say 3 months, as the time required for training 
such men. 

Dr. Lamb. How many of the operations in aircraft would require 
3 months minimum, and how many would require 6 months, or longer? 

Commander Eade. That is a difficult question too. I think a 
study of that definitely would have to be made. 



7304 DETROIT HEARINGS 

Dr. Lamb. Don't you think it is important that a study such as 
that should be made? 

Commander Eade. Yes. 

The Chairman. Thank you very much, Commander. We appre- 
ciate your coming here, and the very fine statement you have sub- 
mitted. It will be very helpful to us. 

Our next witness is Professor Hill,' 



1 The statement and testimony of Prof. E. B. Hill, of the farm management department, Michigan 
State College, appears in pt. 19, a separate volume on the Detroit hearing, containing testimony, expert 
papers, and exhibits exclusively on the subject of agricultural migration into the area. 



NATIONAL DEFENSE MIGKATION 



WEDNESDAY, SEPTEMBER 24, 1941 

House of Representatives, 
Select Committee Investigating 

National Defense Migration, 

Washington, D. C. 

afternoon session 

The committee met at 1:80 p. m. 

The Chairman. The committee will come to order. 

Mr. Raymond will be our first witness this afternoon. 

TESTIMONY OF EARL E. RAYMOND, PRESIDENT, TRAILER COACH 
MANUFACTURERS ASSOCIATION, SAGINAW, MICH. 

The Chairman. Congressman Osmers will interrogate you, Mr. 
Raymond. 

Mr. Osmers. Mr. Raymond, will you state for the record your 
name and the position you hold? 

Mr. Raymond. Yes, sir; I am Earl Raymond, president of the 
Trailer Coach Manufacturers Association. 

The Trailer Coach Manufacturers Association is composed of man- 
ufacturers wdio produce approximately 70 percent of the output of 
the industry. 

Mr. Osmers. The committee, as you point out in your paper, is 
primarily interested in the part that trailers are playing in the housing 
of defense project workers. Your paper will be introduced into the 
record. 

(The paper referred to above is as follows:) 

STATEMENT BY EARL E. RAYMOND, PRESIDENT, TRAILER COACH 
MANUFACTURERS ASSOCIATION 

For your record may I say that I am speaking directly for the trailer coach 
manufacturers who belong to the Trailer Coach Manufacturers Association — the 
national trade organization of our industry. Our members produce approxi- 
mately 70 percent of the current trailer coach production. 

Indirectly, I'm also speaking for the trailer coach dealers of the country who 
merchandise our products and for the trailer park operators who provide the park- 
ing sites and services needed by the trailer owners who buy our coaches. 

I understand that your committee is primarily interested in the part trailer 
coaches are playing in the housing of defense project workers. I'll therefore try to 
confine my remarks to points pertinent to your investigation as these apply to the 
use of trailer coaches. 

■USE OF TKAILERS BY THE GOVERNMENT 

You are aware, we understand, that the Coordinator of Defense Housing already 
has recognized both the economy and desirability of trailer coaches for mobile 
■emergency defense housing. Our industry has supplied over 4,000 trailer coaches 

7305 



7306 DETROIT HEARINGS 

so far this year in his temporary shelter program- — and this, by the way, at a cost 
of less than $300 per person — including furniture — everything needed except bed 
linen, dishes and cooking utensils. We cite this figure in comparison of the per 
capita cost of housing our soldiers in training camps as %Yell as in comparison with 
what is being spent on a per capita basis on defense-housing projects throughout 
the country. 

Before the Government became interested in the use of trailers for shelter 
housing, individual defense workers recognized them as a satisfactory solution of 
the housing problem occasioned for them by the increased industrial activities in 
many areas. In many such regions acute housing shortages developed early in 
1940 and as a consequence the demand for trailer coaches throughout the year 
kept all of our factories running at peak capacity; several in fact had to increase 
their facilities and pay rolls to even keep up with the demand for trailers— prin- 
cipally from defense workers who, on their own initiative, and at their own expense, 
solved their immediate housing problem at no cost to the Government by pur- 
chasing a trailer coach. 

At the beginning of 1941, therefore, practically all trailer coach producers were 
operating at their full normal capacity with large banks cf unfilled orders on hand. 

EFFECT OP GOVERNMENT ORDERS 

In March the Government, through the Farm Security Administration, entered 
the trailer market for its first 2,000 coaches and demanded delivery within 30 
days. In order to accomplish this without disrupting our regular dealer distribu- 
tion it became necessary to increase our output by putting on extra shifts, taking 
advantage of mass production methods by manufacturing standard models, and 
in many instances of utilizing additional working space. 

The result was that Government jobs were delivered on time, that economies 
in production costs (through making standard jobs) were uncovered, and what 
was once considered our industry capacity output was practically doubled during 
the period the Government orders were being filled. 

This proved fortunate because the housing problem apparently has become more 
serious as the year advanced. Individual defense workers who are compelled to 
provide accommodations for themselves and their families have continued to 
depend more and more on the trailer for their housing facilities. They have 
placed orders through regular trailer dealer channels in sufficient quantities to 
more than absorb the increased output of the industry at the pace to which it 
was stepped up by the Government orders. This continued increased production 
has practically exhausted anticipated stocks of suppliers and the priority limita- 
tions have made it practically impossible for them to be replaced. 

At present the industry is facing a very serious situation in a lack of materials. 
Unless something is done quickly many plants will be forced to shut down. This 
of course will be a blow to the individual plant owners, but of considerably more 
concern to the men that will be thrown out of work and the industrious defense 
workers who are desirous of providing their own shelter in trailer homes and who 
will find them not available. 

NEED FOR GOOD TRAILER PARKS 

On the question of the need for good trailer parks it can be said that good 
trailer homes with all equipment for comfortable living but without proper park- 
ing facilities are like modern high speed automobiles without good roads. Modern 
trailer parks take time to develop and require a substantial outlay of capital. Due 
to increased activity practically all established parks are being improved and en- 
larged and many new ones are under construction. There is plenty of capita 
that can be interested in this type of investment provided: 

1. That the general public will look with favor on the average trailer user rather 
than with contempt. This change is taking place due to great a extent by the 
fact that the United States Government has recognized the trailer as a practical 
housing accoinmodation and has t;)Ought substantial quantities for this purpose. 
Under the direction of Mr. Donahue's office satisfactory trailer parks have been 
built by the Farm Security Administration or are under construction for the 
parking of the Government-owned trailers which are being rented to defense 
workers. We of the industry realize that much of the success of the Government's 
experiment in its use of trailer coaches for temporary shelter is dependent on the 
type of service rendered and the general api^earance of these Government trailer 
parks. If handled well, as we are expecting they will be, they should set a desirable 
pattern for the private trailer park operator to follow. 



NATIONAL DE-FENSE MIGRATION 7307 

2. That prejudice or misinformed communities do not curtail or prohibit private 
trailer-park developments by restrictive legislation. Considerable progress in 
our favor has been made in this respect recently and this again has been helped 
by the Government action. 

PREDICTION FOR THE FUTURE 

As trailer-coach producers, naturally we are optimistic over the more extensive 
use of trailers for homes during the defense period and after the present national 
emergency is over. 

When jt is remembered that there were upward of 200,000 trailer coaches in 
use prior to the development of the national-defense effort, and that during 1941 
approximately 20,000 additional trailers went into use — probably 95 percent of 
them for temporary housing — and when it is reported that tlie defense workers 
who are being sheltered in trailers have been found to be enthusiastic over them 
(it was felt by the Government officials that they would not be very highly 
regarded) we can only look forward to an increased use in the immediate future — 
provided of course that our industry is given the materials needed to make them. 

Then, after the emergency, we likewise can only look to a continuation of the 
present demand — for many years to come. Ours is a depression -born industry. 
Trailer coaches came into the national picture to a considerable extent through 
the demand for lower housing costs. 

If we are faced, as we probably will be, by a period of slackened employment 
after the present emergency is over, then the trailer coach again will be called 
to meet the needs of thousands wlio will be forced to very carefully budget their 
resources for a period until they can be more permanently reestablislied. 

Trailer-park owners, therefore, who now are developing facilities for use of 
trailer owners during the national-defense period, if they are fortunate in the 
selection of their sites, can, we believe, be assured of a fairly stable future in 
their present ventures. 

In closing may I tliank your committee for the understanding of the trailer 
mode of living that has been shown in your earlier hearings. We of the trailer- 
coach industry feel that you've been very considerate of our problems and our 
interests as small business firms. We are grateful to you. 



TESTIMONY OF EARLE E. RAYMOND— Resumed 

Air. OsMERS. I wonder if you would toll us something about the 
work of the trailer industry on Government orders. 

Mr. Raymond. Along in November of last year the trailer industry 
had a representative in Washington, in an attempt to interest the 
Government in the advisability of using trailers in areas where defense 
housing was becoming a problem. 

Mr. Palmer's office — the office of Defense Housing Coordinator — ■ 
along in March of this year ordered a quantity of trailer coaches. 
They were requisitioned and bids solicited by the Farm Security 
Administration. 

Mr. OsMERS. Do you know the total ninnber that were ordered or 
bought or are now on order for the Government? 

FOUR THOUSAND TRAILERS PURCHASED 

Mr. Raymond. Approximately 4,000 units have been bought up to 
date. 

Mr. OsMERS. Do you expect that they will use more? 

Mr. Raymond. Yes, sir; we feel confident they will use more be- 
cause, according to those in authority there, the trailers have proved 
satisfactory for the purpose for which they were purchased. 



'7308 DETROIT HEARINGS 

Mr. OsMERS. What is the effect of priorities on the industry? 

Mr. Raymond. Right now it is serious. The Governnient's pur- 
chases of coaches have increased the normal output of the industry to 
such an extent this year that the ordinary run of supphes and materials 
was used up ahead of schedule, and with the priorities system in force 
at the present time, it has been almost impossible to replace the 
materials. 

TWENTY THOUSAND TRAILERS PRODUCED ANNUALLY 

Mr. OsMERS. What is the annual production of trailers in the 
United States now? 

Mr. Raymond. Approximately 20,000 units. 

Mr. OsMERS. How many more units could the industry produce 
with its existing equipment if it was given priorities for material? 

Mr. Raymond. With present facilities, 1 don't think that could be 
exceeded very much. 

Mr. Osmers. The plants are about up to maximum capacity at 
present? 

Mr. Raymond. Yes, sir. 

Mr. Osmers. Tell us a little about the use to which the Govern- 
ment is putting the trailers that it has bought. 

Mr. Raymond. At the present time there are 14 areas which have 
been designated as critical defense areas, in which there will be very 
serious housing shortages. 

Some of the areas already have industrial plants and projects in 
operation, and in those the housing shortage is already evident. 

TRAILERS SHIFTED IN ACCORDANCE WITH NEEDS 

In other cases a shortage has been anticipated, coaches have been 
placed in the areas. Due to changes in policy and programs, it is 
becoming necessary to shift these coaches from one area to another. 
For instance, in Baltimore, over there in the neighborhood of the 
Glenn Martin aircraft plant, there are quite a few coaches — I would 
judge about 350— and they are practically all in use. 

In the Nashville area there were a few more than 350, possibly 
400 units placed, and we just learned last week that they are to be 
taken from the Nashville area and put in areas in which the shortage 
has become more acute — ahead of expectations. 

TRANSPORTATION OF TRAILERS 

Mr. Osmers. How does the Government transport the trailers? 

Mr. Raymond. There are transportation companies in the trailer 
industry, and the Government so far has employed the facilities of 
these transportation companies for transporting the coaches. 

Mr. Osmers. Now, if you can estimate it, what has been the sale 
to individual defense workers? 

Mr. Raymond. The industry as a whole has, to the very best of its 
ability, made a pretty careful check of that, and hopes that sometime 



NATIONAL DEFENSE MIGRATION 7309 

we might be able to get a priority. We find that upward of 85 
percent of the output during 1941 has been sold in so-called defense 
areas. 

We have no absolute proof that all the coaches sold in those areas 
have gone to defense workers, but the areas so designated are areas 
in which the normal sale of coaches is not very great, so we have good 
reason to assume that the big majority of trailers sold in those areas 
are going" to defense workers. 

STANDARDS FOR TRAILER PARKS 

Mr. OsMERS. What sort of standard has the industry set up for 
trailer parks, and how well has the Federal Government followed 
those standards? 

Mr. Raymond. That has been a troublesome point in the industry. 
There have been several reasons. Trailers were more or less dumped 
on the public a few years back, and sometimes the parking facilities 
were far below fair living standards. 

FARM SECURITY ADMINISTRATION TRAILER PARKS 

We have had to work and strive to the best of our ability to get the 
standard of trailer parks raised in the last year or so, and we have had 
considerable help from the department set up by the Farm Security 
Administration and Mr. Palmer's office. 

Definite plans of park design have been promoted. The engineering 
department of the Farm Security Administration, headed by Mr. 
Donovan, has purchased land and begun to build parks in every area 
that has been classed as a defense area, and their plans and their 
program for park construction are very much worth while. If they 
are carried out, we have every reason to beheve the trailers will be 
capably provided for. 

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

Mr. Raymond. And I thank you very much, gentlemen, for the 
time you have given me. 

TESTIMONY OF PANEL REPRESENTING THE AUTOMOBILE 
INDUSTRY OF MICHIGAN 

The Chairman. Our next witnesses will be seven gentlemen repre- 
senting the automobile industry. 

Gentlemen of the panel, I think it would be well for the committee 
to state that we haven't any preconceived notions as to how to solve 
this problem of national defense migration. 

We have traveled over the United States trying to get the facts. 
Any questions that we ask you today are for the sole purpose of ob- 
taining facts. We are not trying to cross-examine any witness. 
Instead of asking you to appear before our committee in Washington 
we have come to you people here in Detroit to get our answers. We 
appreciate your coming here and giving what information you can, 
so that we may report our findings back to Congress. 

The papers you gentlemen have prepared are a valuable contribu- 
tion to our record, and will be incorporated therein. 



7310 DETROIT HEARINGS 

(The papers refeired to above are as follows:) 

STATEMENT BY C. C. CARLTON, MOTOR WHEEL CORPORATION; 
PRESIDENT, AUTOMOTIVE PARTS & EQUIPMENT MANUFAC- 
TURERS, INC.; MEMBER, AUTOMOTIVE INDUSTRY DEFENSE 
ADVISORY COMMITTEE, OFFICE OF PRODUCTION MANAGE- 
MENT, AND COMMISSIONER IN CHARGE OF INDUSTRY, MICHI- 
GAN COUNCIL OF DEFENSE 

May I first briefly describe the relationship of the automotive parts and equip- 
ment industry to the automobile and truck industry, and indicate the geographical 
concentration of the factories and the employment therein? With that as a 
beginning, the following analysis of employee migratory trends will be more 
readily understood. 

Automobile manufacturers — whose corporate names such as General Motors, 
Ford, Chrysler, Studebaker, Hudson, Packard, Nash, Willys-Overland and 
Crosley are familiar to all — are the customers of a large number of manufacturers 
who produce wheels, bodies, carburetors, bumpers, engine parts, and in fact the 
entire list of components which together make up the modern motorcar. 

Automobile and truck manufacturers are the customers of a large number of 
manufacturers of automotive parts for chassis and actuating mechanisms, electric 
equipment, bodies, and accessories which make up the automotive vehicle. A 
list of the chief component parts of an automobile is appended hereto. 

Automotive-parts manufacturers may be divided into three classes as far as 
their production is concerned; viz: 

(a) Manufacturers of "original equipment." This equipment is purchased by 
and shipped to the manufacturers of automobiles and trucks. 

(6) Manufacturers of "replacement parts." These parts are sold to the man- 
ufacturer of the automotive vehicle, to jobbers, distributors, dealers, and garages, 
to service the automotive vehicles already on the road. 

(c) Manufacturers of "accessories," such as car heaters, bumpers, luggage 
carriers, rear-view mirrors, tire chains, accessory lightijig equipment, and miscel- 
laneous accessories which may or maj^ not be "original equipment" on the vehicle 
as sold to the consumer. 

All manufacturers of original equipment are manufacturers of replacement 
parts, but many replacement parts manufacturers do not manufacture original 
equipment. 

The automotive-vehicle manufacturer of course builds automotive parts him- 
self, but there are some parts of automotive vehicles which are not made at all 
by the vehicle manufacturer. In most cases, however, the largest potential com- 
petitor of the parts manufacturer is his own big customer, who may make a per- 
centage of any given part in his own factory and "farms out" the balance of his 
requirements to the automotive-parts manufacturer. This factor is an important 
one in our present discussion and it will be explored more extensively later on. 

GEOGRAPHICAL CONCENTRATION 

At the time N. R. A. was put into operation, there was no accurate list of 
automotive-parts manufacturers available. The best information as to the total 
number of automotive-parts manufacturers was secured by the so-called Code 
Authority of the autoinotive parts and equipment manufacturing industry." After 
careful investigation over a period of a year, 856 manufacturers of automotive 
parts and equipment reported as required by the law to the Code Authority of 
that industry. So when we talk about the manufacturers of automotive parts 
and equipment, we are talking about approximately 800 manufacturers; the 
large majority of whose plants are located in the smaller cities and towns. This 
approximate 800 manufacturers are located in at least 131 cities and in at least ii 
30 States of the Union. j' 

However, the hub and center of the industry lies in the Detroit area, where If 
many major assembly plants are located. The suppliers naturally build up their '■ 
business within easy shipping distance of the plants of their customers. On a 
map of this area, a circle with its center in Detroit and with a 300-mile radius will ! 
encompass 73.6 percent of the manufacturers of the parts industry and, more 
important to the present inquiry, 97.7 percent of the employees of this industry. 

A smaller circle with its center near Sandusky, Ohio, and with a radius of 185 
miles, encompasses 80.7 percent of the employees of this industry but onl}^ 52.8 
percent of the factories. 



NATIONAL DEFENSE MIGRATION 7311 

The employees of the automotive parts and manufacturing industry number 
more than 200,000. Within the larger circle which includes Chicago, Milwaukee, 
Buffalo, Pittsburgh, Cleveland, Cincinnati, Toledo, and South Bend, with Detroit 
as its center, are employed almost 200,000 persons. In fact the great majority of 
these employees are in the Detroit area. 

These estimates, added to those which you have* from representatives of the 
automotive-vehicle manufacturers, present a graphic picture of concentration of 
labor of a highly specialized type. 

RELATION OF EMPLOYMENT TO AtTTOMOBILE PRODUCIION 

Historically, the automobile business has followed a definite policy of yearly 
change. New models are introduced each year, and there is necessarily a period 
when large numbers of employees are laid off, while the factories close the produc- 
tion of the current models, change their tools and equipment as needed, and begin 
the new year model run. As the demand for parts slackens or increases, there 
are consequent peaks and valleys in the parts-manufacturers' employment records. 

This year, great changes were wrought in the industry as it prepared to assume 
large defense orders, and the pattern of full employment ran well past its usual 
declining point. Yet the change-over period did come, and we are just now 
entering the production season again. 

In this connection, I would like to refer to the point made earlier, that the 
automobile manufacturer can, and does, make many of his own parts. I do not 
know the exact percentages of parts produced by the various manufacturers for 
their own cars, but let us assume that manufacturer A makes 50 percent of any 
part he needs, and buys 50 percent from parts manufacturers. If, then, his total 
need is reduced during the coming year it is natural to assuma that he will try to 
keep his own employees busy, and that the orders to the parts company will 
diminish progressively. In some cases, it is conceivable that the entire percentage 
of farmed out production may vanish. 

It is also possible that the assumption of defense orders by large plants may 
bring about the reverse of this trend in some cases for a short time. The major 
manufacturer may wish to train more and more of his own people in the defense 
job, thus holding the parts company's orders fairly level. Yet even then the 
progressive decline of total volume, as charted by the Government agencies, will 
bring about the release of workers in the parts plants unless there are other kinds 
of jobs available. 

TRENDS OF DEFENSE EMPLOYMENT 

Our efforts to procure a comprehensive record of present and future defense 
employment have not been entirely successful, yet the evidence of some trends is 
fairly conclusive. Generally, our plants which make engine parts find that there 
is more work available in the aviation engine program than they can handle. 
Plants which have the equipment to make ordnance face tremendous and expand- 
ing demands. A factory which usually makes automotive or truck gears naturally 
is in line for gear work for Army trucks and tanks. And parenthetically it may 
be observed that the defense program calls for more trucks than ever have been 
produced in peacetime; consequently the manufacturer of truck parts need worry 
only about material, and perhaps later about skilled manpower. 

In another section of our industry, the manufacturers are not so fortunate, 
and the prospects of continued high employment are not bright. We have three 
kinds of labor and equipment which are not needed in the defense program to 
date, in the quantities presentlv found. One problem is illustrated by the larger 
number of metal presses of all sizes, and labor to handle them, in our plants. 
The work needed for these machines and men is comparatively light metal stamp- 
ings. Yet with the exception of a few quartermaster's items, we have had no 
orders which would require the use of these presses. 

The second unused portion of our industry, as we envision the coming defense 
program, involves plating work. The third great unused skill is our ability to 
perforni rapid hand assen.bly in tremendous quantities. 

No doubt these facts are all receiving attention from. Governm.ent offices at 
present, and various individuals and associations liave built up a record as com- 
plete as possible for the Labor Supply Section of the Office of Production Manage- 
n^ent. I respectfully recomn.end to this com.mittee that it consult the members 
of the Labor Supply Section of the Office of Production Management, if it has not 
already done so, before preparing its final recommendations. ^ 

1 See paper and testimony of Eric A. Nicol, Associate Chief, Labor Supply Branch, OfBce of Produc- 
tion Management, p. 7488 ff. 

60396 — 41 — pt. 18 17 



7312 



DETROIT HEARINGS 



GEOGRAPHICAL PROBLEMS IN DEFENSE 



As a ir.en.ber of the Michigan Council of Defense, and also in m.y duties as 
president of Auton.otive Parts & Equipn.ent Manufacturers, Inc., I have spent 
son .e til) .e and effort in trying to detenr.ine the geographical variations inherent 
to the transition from peace-tin .e pursuits to defense production. With the fore- 
going staten.ents in n.ind, one can readily see that if a preponderance of n\etal- 
stan.ping con.panies are found in one sn.all town, that locality is likely to suffer 
large unen.ployn.ent. If an industrial city has built up its employrr.ent around a 
large auton.obile assen.bly plant which is not in line for immediate defense work 
the san.e thing will happen. Generally, this problem, assum.es two forn.s: there 
are cities and towns which do not have sufficient necessary factory equipn.ent 
ever to be of use in straight defense work, and there are others which have factories 
which will be used for defense after 6, 8, or 10 n.onths, but which will have an 
interim period of large unen.ployn.ent. Of the first class, Sturgis, Mich., is an 
exan.ple; of the second, one n.ight take Lansing, Mich., as a good example. 

These facts, I n.ight add, also are being studied at present by the Labor Supply 
Section of Office of Production Managen.ent, and by special certification of unusu- 
ally hard-hit areas we n.ay be favored with Governinent help. 

MIGRATORY TRENDS 

Appended hereto are analyses of various surveys m.ade by Autom.otive Parts & 
Equipn.ent Manufacturers, Inc., dunng the past few weeks, wh'ch will give your 
con.n.ittee certain precise inforn.ation as to the estim.ates ir.ade by our nearly 400 
parts plants of the en.ployn.ent problen.s they face. Generally, it will be found 
that defense work now on hand or anticipated for the im.mediate future w:'i not 
entirely absorb the workers laid off because of the mandatory reduction in the 
production of passenger cars. In total, the amount of left-over labor is not f righ ten- 
in-^, but it n.ust be ren-.en .bered that the total review includes son.e plants which 
are going to be very hard-hit, and others which will suffer very little, if at all. 

These exhibits also include reports which were sent in as a result of a ques- 
tionnaire distributed 3 weeks ago, which was made up after conferences with the 
field representatives of the Committee on Migratory Labor. Generally, it will 
be seen that there has been little migration of labor in this industry during the 
past year, and we know of no such trends at present. 

Again, however, we must take into account the history of the automobile indus- 
try, and it is common knowledge that during the period of great expansion this 
industry became the employer of thousands of men who came to the Detroit area 
from the farm and small-town areas. Even now, as one reviews the returns of 
our most recent questionnaire, he will find that among new employees there are 
more from Kentucky than, for example, from Pennsylvania to the east or from 
Missouri or Iowa to the West. From southern Ohio, Indiana, Kentucky, and 
Tennessee a great many of our workers were drawn in the twenties. The sons 
of these migratory workers now are found in our factories, and for some years 
we have not drawn from the outside because the supply of local labor was 
plentiful. 

During defense times we have refrained from reading other States, and have 
not advertised for men extensively; the result has been that among all the States 
Michigan, we believe, has the best record to date for stability of employment and 
for restraining migration. The Michigan Council of Defense has contacted de- 
fense councils of other States and asked them to warn their citizens not to come 
to Michigan expecting to find immediate employment. In fact, we have asked 
them to notify their people not to come to Michigan for work unless they have 
a definite job before leaving home. 

Whether this record can be maintained in the near future is a question which 
might well engage the attention of this committee. We are generally agreed that 
there will be a period of change-over from our usual business pursuits to defense 
work, and that during this period of a year or so there will be dislocations of labor. 
We are further agreed that the defense production will reach a high level in the 
closing stages of next year, and that by then our employment problem may well 
be one of finding enough men to man our plants. But between now and that 
period of full employment, some means should be found to discourage large-scale 
wandering of labor from one town to another. 



NATIONAL DEFENSE MIGRATION 7313 

Exhibit A. — Classification of Automotive Employees 

At the request of a representative of the House Committee Investigating Na- 
tional Defense Migration, an attempt was made to analyze and classify employees 
as outlined below. It was found, however.' that the preparation of these question- 
naires was a very great task and consequently only a minority of manufacturers 
employing a minority of the total of over 200,000 employees were able to reply. 

However, from the replies received, the following information w^as gathered 
which mav be typical of the entire industry. 

The analysis made consisted of 3 groups of 15,000 employees in each group, em- 
ployed by 8 different manufacturers. One group of employees was employed in 
the city of Detroit, one group in the State of Michigan outside of Detroit and one 
group outside of the State of Michigan. 

Results from partial returns as above indicated show employed in defense in- 
dustries 25 percent in the city of Detroit, 33 percent in the State of Michigan out- 
side of Detroit and 38 percent in the plants reported outside of Michigan. 

From the same group of employees it was found that those employed from the 
city in which the manufacturing plant is located indicate 41 percent from Detroit, 
90 percent from Michigan cities outside of Detroit and 98 percent by plants out- 
side of the State of Michigan. 

The reply to question as to ho;v many employees were employed from the State, 
but not from the city, in which the plant is located, showed 43 percent in Detroit 
plants, Vli percent in Michigan plants outside of Detroit and 1 percent outside of 
Michigan. In other words, 84 percent of the group of Detroit employees came from 
the State of Michigan; 97% percent of the employees outside of the city of Detroit 
came from the State of Michigan and 99 percent of the employes employed in 
plants outside of the State of Michigan came from the State in which the plant 
employing them is located. 

Exhibit B. — Sample of Notice and Employment Questionnaire Sent Out 
TO Factories by Automotive Parts and Equipment Manufacturers, Inc. 

To Members: A congressional committee (headed by Representative John H. 
Tolan of California) will hold public hearings in Detroit on September 24 and 25 
on the question of migratory workers and what to do about them. 

Preliminary to the meeting, the committee is asking the cooperation of a few 
factories in procuring a record of present employment, to show as far as possible 
where the workers came from, and how long they stayed on the job. 

We have agreed to assist in this effort, and are sending out the enclosed ques- 
tionnaire to you with the hope that you can return it filled in without too much 
trouble. 

If some of the answers are not readily available, will you please give us those that 
are? Your employment records in many cases will provide the data — or enough 
to give us a start. We can be of quite valuable assistance in this survey, and we 
hope to avoid more than routine hearings by getting much of the information in 
advance. 

Sincerely, . 

Frank Rising, General Manager. 

P. S. — Two copies of questionnaire attached — one to be filled in and returned 
to Automotive Parts and Equipment Manufacturers; the other for your files. 

questionnaire on migration of workers 

1. Number of employees as of Sept. 2: 

(a) Employed on defense work 

(b) Employed on nondefense work 

2. Analysis of present labor force to show the following: 

Employees employed — 

1 year or Over 1 
(a) Number from city in which plant is located or in less year 

normal commuting area 

(6) Number from rest of State 

(c) Number from outside of State 



7314 



DETROIT HEARINGS 



3. Show on the attached sheet the number of workers hired since June 1, 1940, 

who actually came to work for your company directly from each of the 

States listed. 

Employees employed — 
1 year or Over 1 

4. (a) Number with previous experience in automobile and less year 

parts industry 

(b) Other manufacturing 

(c) Agricultural 

(d) No previous work experience 

(e) Other 

Please fill in and return immediately to Automotive Parts & Equipment Man- 
ufacturers, 800 Michigan Building, Detroit, Mich. 

Company 

Location 



Question No. S. — Show the number of workers hired since June 1, 1940, who 
actually came to work for your company directly from each of the following States: 



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 

Pouth Carolina-- 

South Dakota 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington 

West Virginia 

Wisconsin 

Wyoming 



Exhibit C— Report on Employment Questionnaires Sent Out by Auto- 
motive Parts & Equipment Manufacturers, Inc. 

Questionnaires were returned by companies in the following cities and areas: 



Com- 
pany 
number 



City or town 



Rockford, 111 

Saginaw, Mich 

Detroit, Mich... 

Racine, Wis 

Huntington Park, Calif 

Pontiac, Mich 

Detroit, Mich... 

do 

Ann Arbor, Mich 

Muskegon Heights, Mich... 

Detroit, Mich 

Detroit and Plymouth plants 
combined. 

Portland, Ind... 

Detroit, Mich 

do 



Company's principal product 



Universal joints. 

Tappets and valves— automotive and aviation. .. 

Mouldings and body hardware 

Radiators and aviation heating and cooling units 

Carburetors --. 

Body hardware and stampings. 

Brass strip, rod, and wire and copper strip 

Steering gears .■ 

Springs— automotive and aviation 

Piston rings 

Bumpers .- 

Wheels, brakes, hubs, and drums 

Steering wheels and moulded plastics. 

Springs— automotive and aviation 

Radiators— automotive and aviation. 



Average 
employ- 
ment 



735 

1,223 

1,182 

632 

78 

435 

1,159 

522 

116 

732 

504 

3,447 

509 
328 
312 



NATIONAX, DEFENSE MIGRATION 



7315 



Com- 
pany 
number 



City or town 



Wyandotte, Mich 
Chicago, 111 

Cleveland, Ohic- 

St. Louis, Mo 

Muncie, Ind 

Hagerstown, Ind.. 
Lansing, Mich .. . 
Ann Arbor, Mich. 



Company's principal product 



Gaskets— automotive and aviation 

Lubrication fittings, mstruments, heaters— automo 
tive and aviation. 

Bearings and bushings — automotive and aviation 

Piston rings— automotive and aviation 

Transmissions 

Piston rings— automotive and aviation 

Wheels, hubs, bralte drums 

Automotive instruments 



Average 
employ- 
ment 



346 
3,396 

2,115 
390 

2,085 
700 

2,078 

1,024 



Questionnaires were mailed to but not returned by the companies in the fol- 
lowing cities and areas: 



Com- 
pany 
number 



City or town 



Company's principal product 



Average 
employ- 
ment 



Detroit, Mich 

St. Louis, Mo 

Cleveland, Ohio 

do 

Syracuse, N. Y 

Buffalo, N. Y 

West Orange, N. J... 
LaPorte, Ind 

Detroit, Mich. 

Philadelphia, Pa 

Worcester, Mass 

LaCrosse, Wis. 

Detroit, Mich 

Buffalo, N. Y 

Toledo, Ohio 

Bronson, Mich 

Detroit, Mich 

South Bend, Ind 

Chicago, 111 

Muncie, Ind 

Toledo, Ohio 

Ecorse, Mich 

Grand Rapids, Mich 
Milwaukee, Wis 



Axles 

Carburetors 

Valves, pistons, and pins- automotive and aviation.. 

Crankshafts 

Gear, differential, and transmission assemblies 

Automobile radiators 

Magnetos and spark plugs 

Pistons 

Engine bearings. 

Piston rings 

Gaskets 

Automotive and aviation escutcheon plates and panel 
dials. 

Fiber products 

Ilydrnulic shock absorbers, aviation parts 

Electrical equipment 

Electrical— starring, lighting, and ignition equipment 

Tubing — automotive and aviation 

Carburetors --. 

Service tools 

Water pumps and parts. .-- 

Universal joints, transmission, axles 

Automotive frames 

Body hardware 

Accessories -- 



3, 462 

1,446 

4,480 

708 

1.400 

128 

240 

166 

1,649 

259 

141 

614 

908 
1,845 
3,889 



829 

996 

28 

82 

1,775 

1,132 

954 

93 



DETROIT, MICH., 8 PLANTS 

1. Number of employees as of Sept. 2: 

(a) Employed on defense work 2,455 (7 plants) 

(6) Employed on nondefense work 6,656 (8 plants) 

Em ployees em ployed > 
1 year Over 1 

2. Analysis of present labor force to show the following: or"less year 

(a) Number from city in which plant is located or in 

normal commuting area 1, 048 2, 698 

(6) Number from rest of State 107 140 

(c) Number from outside of State 164 508 

3. Show on the attached sheet, the number of workers hired since June 1, 1940 

who actually came to work for your company directly from each of the 
States listed. 

Employees employed • 
1 year Over 1 
or less year 

4. (a) Number with previous experience in automobile and 

parts industry . 513 1,943 

(6) Other manufacturing 228 339 

(c) Agricultural 43 76 

(d) No previous work experience 312 667 

(e) Other 223 321 

' These figures will not balance because one company did not submit necessary figures for inclusion. 



7316 DETROIT HEARINGS 

Number of workers hired since June 1, 1940, who actually came to work for these 
companies directly from each of the following States: 



Alabama 2 

Arizona 

Arkansas 4 

CaHfornia 1 

Colorado 1 

Connecticut 

Delaware 

Florida 

Georgia 1 

Idaho 

Illinois 15 

I ndiana 2 

Iowa 4 

Kansas 1 

Kentucky 26 

Louisiana 1 

Maine 

Maryland 

Massachusetts 

Michigan 672 

Minnesota 5 

Mississippi 4 

Missouri 8 

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 



11 
2 



30 
1 



Michigan, outside Detroit {6 plants) 

1. Number of employees as of Sept. 2 — 

(a) Employed on defense work 2, 128 (6 plants) 

lb) Employed on nondefense woik 4, 101 (6 plants) 

Employees employed— 

2. Analysis of present labor force to show the following: _ l year or less Over i year 

(a) Number from city in which plant is located or in 

normal commuting area 1,332 4,573 

(b) Number from rest of State 79 94 

(c) Number from outside of State 37 114 

3. Show on the attached sheet the number of workers hired since June 1, 1940, 

who actually came to work for your company directly from each of the 

States listed. 

Employees employed — 
1 year or less Over 1 year 

4. (a) Number with previous experience in automobile and parts 

industry 179 3,580 

(b) Other manufacturing 199 308 

(c) Agricultural 227 132 

(d) No previous work experience 344 482 

(e) Other 580 279 

Number of workers hired since June 1, 1940, who actually came to work for 
these companies directly from each of the following States: 



Alabama 3 

Arizona 

Arkansas 10 

California 

Colorado 1 

Connecticut 

Delaware 

Florida 

Georgia 1 

Idaho 1 

Illinois 23 

Indiana 20 

Iowa 4 

Kansas 5 



Kentucky 10 

Louisiana 

Maine 

Maryland 

Massachusetts I 

Michigan 481 

Minnesota 10 

Mississippi 

Missouri 7 

Montana 

Nebraska 3 

Nevada 

New Hampshire 

New Jersey 



NATIONAL DEFENSE MIGRATION 



7317 



New Mexico 

New York 

North Carolina. 
North Dakota-. 
Ohio 



15 



Oklahoma 

Oregon 

Pennsylvania 12 

Rhode Island 

South Carolina 



South Dakota. 

Tennessee 

Texas 

Utah 

Vermont 

Virginia 

Washington. _ 
West Virginia- 
Wisconsin 

Wyoming 



OUTSIDE MICHIGAN (9 PLANTS) 



1. Number of employees as of Sept. 2 — ■ 

(a) Employed on defense work 5, 521 (8 plants) 

(6) Employed on nondefense work . 9, 399 (9 plants) 

2. Analysis of present labor force to show the following: 

Employees employed— 
1 year or Over 

(a) Number from city in which plant is located or in less l year 

normal commuting area 3,723 11, 086 

(b) Number from rest of State 14 8 

(c) Number from outside of State 62 27 

Show on the attached sheet, the number of workers hired since June 1, 1940, 

who actually came to work for your company directly from each of the States 

listed. 

Employees employed — 

1 year or Over 

Number with previous experience in automobile and less i year 

parts industry 126 2,411 

Other manufacturing 685 529 

Agricultural 87 212 

No previous work experience 293 253 

Other 92 173 



3. 



4. (a) 



(b) 
(c) 
(d) 
ie) 



Number of workers hired since June 1, 1940, who actually came to work for 
these companies directly from each of the following States: 

Nebraska 1 

Nevada 

New Hampshire 

New Jersey 1 

New Mexico 

NewYork 11 

North Carolina 

North Dakota -- 

Ohio -- 

Oklahoma 2 

Oregon 

Pennsylvania 1 

Rhose Island 

South Carolina 

South Dakota 

Tennessee 

Texas 1 

Utah 1 

Verm.ont 

Virgi nia 

Washington 

West Virginia 

Wisconsin 13 

Wyoming 



Alabama 

Arizona 

Arkansas 1 

California 

Colorado 

Connecticut 1 

Delaware 

Florida 11 

Georgia 

ladho 1 

Illinois 

Indiana 301 

Iowa 2 

Kansas 1 

Kentucky 

Louisiana 

Maine 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 2 

Montana 



Exhibit D. — Address by C. C. Carlton, Before National Aeronautic 
Meeting op Society of Automotive Engineers, March 14, 1941 

In light of world events and the growing importance of aircraft to the Nation, 
never has the wisdom of the establishment of the Society of Automotive Engineers' 
aeronautical section been moru apparent than now. 



7318 



DETROIT HEARINGS 



When you realize that this section was set up 24 years ago, at a time the air- 
plane still was a novelty to most of us, you must agree that the board of governors 
and officers of the Society of Automotive Engineers were indeed far-sighted. 

The wisdom of this move has become especially apparent to me in the past 4 
months. During that time it has been my duty and my privilege to be in close 
touch with several automobile companies who are about to take on major sub- 
contracts for aircraft manufacturers, and with a great number of automotive 
parts companies who, too, will play a big part in this new program. 

Let there be no mistake about the undertaking ahead. It has been my obser- 
vation that the automobile industry is approaching this giant task with all hu- 
mility and respect, and that the relationship that has developed between auto- 
motive manufacturers and aircraft manufacturers is a cordial and healthy one. 

The present cooperation between the aeronautic and automotive groups is, in 
the words of John Warner, Society of Automotive Engineers manager, "right 
down our alley." In other words, the society's organization is already well set 
up and functioning for this very purpose. You only have to look at our aircraft, 
our aircraft engine and other specialized groups, which function along engineer- 
ing lines with our automobile, truck and bus, fuel and lubricants divisions, to 
realize the fine family relationship which exists between the men whose allied in- 
terests make them congenial and cooperative. 

Though most of us have long know this was so, the general public is just begin- 
ning to realize this fact. However, the realization is steadily growing. Already 
five automotive companies are gearing their large facilities to the production of 
airplane engines, thus giving assistance to the aircraft industry, which is badly in 
need of these facilities to handle the huge assignment imposed upon it. 

In addition — and what a tremendous addition it is — the automotive industry 
is going to supply parts and assemblies for thousands of bombers. 

This IS the phase of the defense work with which I have been closely associated 
in recent months, as managing director of the Automotive Committee for Air 
Defense. 

SUMMARY OF WORK OF COMMITTEE 

1 welcome this opportunity to summarize the work of this committee: 

Last October, William S. Knudsen, then production chief of the National 
Defense Advisory Commission and now Director General of the Office of Produc- 
tion Management, called a meeting of leaders of the automotive industries, includ- 
ing car, truck, body, tool, and parts manufacturing companies. About 100 top 
men of the automotive industries, sitting with Army, Navy, and Defense Com- 
mission officials, listened to Mr. Knudsen ask them to undertake the huge pro- 
gram of manufacturing bomber parts, subassemblies, and assemblies. These 
industrial leaders responded unanimously to the appeal, and immediately the 
Automotive Committee for Air Defense was organized. Within a few days, the 
committee leased 30,000 square feet of floor space in the Graham-Paige automo- 
bile plant on the west side of Detroit. Here offices were established, an exhibit 
with major sections from two bombers was set up, and a staff of technical experts 
were employed to advise manufacturers on problems involved in aircraft work. 

Our first job, then, was an educational one. 

We obtained for the display as many separate pieces going into bombers as was 
possible to secure. Our technical services were made available to all manufac- 
turers, whether in the automotive industry or outside it, who had machinery, 
personnel, a pool of labor, and floor space which iright be used to assist in the pro- 
duction of Army bombers. 

The cooperation of the men in industry was literally amazing. Up to this date, 
more than 1,900 difl"erent executives, engineers, and production men, representing 
1,067 companies, have visited the exhibit and conferred with our technical staff 
in order to determine how they might help in this great defense program. Time 
and time again, many of these men have come back — to study the parts closely 
to determine whether their own facilities were equal to the task. 

Throughout this period we have had the aid and advice of the IT. S. Army Air 
Corps, who have had offices adjoining ours from the start. Without the assist- 
ance of Maj. James H. Doolittle and others of the Air Corps staff, our job would 
have been much more difficult, if not impossible. 

NEED FOR MATERIALS, SERVICES IN BOMBER MANUFACTURE 

Just why was the automobile industry asked to undertake this bomber-parts 
program? . . . 

I believe I can quickly illustrate why there was a need for additional facilities, 
such as the automotive industry can furnish, to take some of the load off the greatly 



NATIONAL DEFENSE MIGRATION 7319 

expanded aircraft industry. While the large producers of bombers have worked 
miracles in the past 15 months, yet there still existed a need for more machinery, 
more materials, more management — and the automotive industry is the greatest 
reservoir for these facilities. For a typical example of what the aircraft producers 
were up against, consider the case of one aircraft organization: 

In January 1940 — slightly more than a year ago — this aircraft company had 
less than 5,000 men employed. Today it has nearly 20,000 employees, and that 
number is expected to be doubled before the year's end. Last year it had 500,000 
square feet of floor space. Today it is using 1,500,000 square feet of floor space 
and another million square feet will soon be ready for occupancy. Within a span 
of 2 years, then, this company will have multiplied its floor space by more than five 
and its employees by eight. 

So it soon became evident to defense officials and the Air Corps that one of the 
biggest contributions that the automotive industry could offer was the services 
of its executive personnel in production planning, in purchasing, and in the follow- 
up of purchasing to assure the steady flow of materials. 

The automotive industry, because of the great volume of passenger cars and 
trucks which it produces for the Nation's needs, has led the world in industrial 
organization and scheduling. Consequently, it was to the major producers of 
motor vehicles that we turned for major assistance. 

PLACING OP BOMBER PRODUCTION 

Now, after 4 months of organizational effort, during which time we have 
surveyed the facilities of 800 factories as to the availability of necessary equip- 
ment, the Automotive Committee for Air Defense can make its final report as to 
where this bomber production has been placed. 

For the program, the Army selected three bombers; the B-24D, four-motor 
bomber, designed and now being manufactured by the Consolidated Aircraft 
Corporation; the B-25, two-motored bomber designed and now under production 
by the North American Aviation Co., and the B-26, two-motored bomber designed 
by and now being produced in quantities by the Glenn L. Martin Co. To the 
Ford Motor Co. has been allocated the production of parts and assembles of the 
B-24D, with the assistance of their suppliers, to be shipped to two new assembly 
plants, owned by the U. S. Army; one at Fort Worth, Tex., to be operated by 
Consolidated, and the other at 'Tulsa, Okla., to be operated by the Douglas 
Aircraft Co. The Ford Motor Co. is about to build a new $11,000,000 plant 
in which it will build air-frame assemblies for this bomber, and the Ford company 
believe that it will be possible to have this plant in production before the end of 
this year. This plant will produce wings, fuselages, noses, and stabilizer assem- 
blies on a moving production line which it is believed will prove to be unique in the 
aviation industry. Already 70 Ford engineers and designers are at San Diego 
cooperating with the Consolidated Aircraft Co.'s organization, working out 
methods to speed volume production. 

The immediate plan is for Ford to build 600 sets of assemblies for the Con- 
solidated B-24D long-range, four-motor bomber, and the same number for the 
Douglas Aircraft Co. Production early next year is expected to reach 50 com- 
plete assemblies per month for each company. This huge new plant will be 
located near Ypsilanti, Mich. The first section will be 800 feet wide and 300 feet 
deep; behind this will be another section 1,200 feet long and 400 feet wide, and 
if the Government decides to assemble complete planes in this plant, the building 
will he extended to house an assembly line a mile and a quarter long. 

All of this production is in addition to the orders already placed with Con- 
solidated at San Diego. So the Ford Motor Co. will call on all of their suppliers for 
assistance, and our educational program which collected data from 800 factories, 
will be made available to that great organization for locating proper suppliers. It 
is interesting to note how an organization such as this can take on huge programs 
and parallel them with great defense work already undertaken. For example, at 
Ford, there is rapidly nearing completion a $21,000,000 airplane-engine plant, 
for which ground was broken on September 17 for the production of Pratt & 
Whitney engines which Ford states will be produced at a rate of one per hour. 

These are 18 cylinder, double-row radial engines of two types, one developing 
1,850 horsepower and the other 2,000. In order to get ready for this job, an 
Aircraft Apprentice School, equipped to train 2,000 students at one time, is being 
established. This same company has built its own magnesium-alloy foundry, 
which is already in partial production. This foundry will probably be the largest 
magnesium-alloy foundry in the world, capable of supplying 110,000 pounds of 
light-weight castings a month. A complete U. S. Navy service school to train 



7320 DETROIT HEAKINGS 

navy recruits in technical duties is in operation in the heart of the great Ford 
River Rouge plant, all provided and equipped by Henry Ford at no expense to Ihe 
Government. 

GENERAL MOTORS PRODUCTION 

General Motors Corporation have undertaken the production of necessary parts, 
and assemblies to produce 100 B-25 North American bombers per month in addi- 
tion to a similar quantity which will be produced by the North American Aviation 
Co. in their plants in California and Texas. Again the marvelous facilities of a 
great organization have been put at the command of the Army Air Corps. Ground 
has been already broken for an assembly plant at Kansas City, which plant will 
be owned by the United States Army, manned by North American, and all parts 
and assemblies necessary furnished by General Motors with the help of outside 
suppliers from coast to coast. 

Here, again, we see great defense efforts carried on by a great organization. 
The far-flung defense assignments of General Motors already total $683,400,000, 
which means that all manufacturing centers of any size in the Nation will set 
their industrial wheels rolling as this automotive corporation calls for parts and 
supplies for a long list of defense products. 

General Motors AUison division in Indianapolis, for instance, is turning out 
350 liquid-cooled engines a month, with a production rate several times that 
number expected soon. Its Buick division is now breaking ground in Chicago for 
a plant which will have a capacity of 500 Pratt & Whitney radial engines per 
month. Anderson, Ind., watch a new aluminum foundry rise in 12 weeks, to 
alleviate a bottleneck in airplane castings. In Rochester, production is beginning 
on airplane control and instrument equipments. Cleveland is sending submarine 
engines and other propulsion engines to the Navy from General Motors Diesel 
engine division. In four cities, construction work is going forward and new 
machinery is being installed for the production of machine guns, slated for delivery 
in the latter half of this year. Other General Motors plants are tooling up for 
production of 75- and 105-millimeter shells, cartridge cases, and fuses. 

At the great Glenn L. Martin plant at Baltimore are now being prcduced 100 
bombers per month and before the year is over, the majority of the facilities of 
this plant will be turned largely to the production of that marveloys engineering 
fighting machine, known as the Martin B-26. In order that additional facilities 
might be made available to parallel this production, ground has been broken at 
Omaha for an Army plant to be managed by the Glenn L. Martin Co., and the 
parts and assemblies for this plant will be furnished by three automotive 
organizations. 

CHRYSLER PRODUCTION 

For the manufacture of the fore and mid fuselage section of this bomber, the 
Chrysler Corporation has made available some 600,000 square feet of floor space 
in order that they may play an important part in the program to expand the 
production of Martin bombers. A complement of able and experienced manu- 
facturing executives, drawn from the Chrysler's regular staff has for some months 
been making a special and intensive study of the problems before them in this 
work. The Chrysler Corporation has therefore been designated to serve as a 
subcontractor to the Glenn L. Martin Co. for the shipment of these parts to 
Omaha. 

Before this task was handed to Chrysler, they had already received defense 
orders for nearly 60,000 vehicles of various descriptions, some of them of highly 
specialized types, a substantial part of which has already been shipped. Workon 
a great tank arsenal for which a contract was awarded last August, is proceeding 
on schedule. Seven hundred thousand square feet of new buildings for that pur- 
pose is now under roof and machinery is now being installed. When you remember 
that it requires 1,000 man-hours to build the transmission alone for a 25-ton tank, 
you realize the immensity of Chrysler's tank job. This organization has under- 
taken a number of special engineering assignment such as the conversion of foreign 
machine guns to American standards, and they are now preparing a proposal at 
the Government's request to manufacture these guns in substantial quantities. 
Orders for shells, shell cases, bomb fuses, and field kitchens are under way. The 
Air Corps is interested in a new "in-line" liquid-cooled airplane motor designed by 
Chrysler engineers which they hope will contribute to the development of the art 
of aircraft motor design. The management of the Chrysler Corporation wants 
that corporation to be in readiness to cooperate at all times with the defense 
program to the extent that their resources and capabilities permit. Chrysler 
Corporation is in full agreement with the Government's policies of farming out 



NATIONAL, DEFENSE MIGRATION 7321 

subcontracts for defense work to as many smaller manufacturers as is practical 
in order that the full resources of this country may be applied to meet the present 
emergency. 

GOODYEAR PARTICIPATION 

Goodyear Tire & Rubber Co. is participating in a large way in the production 
of parts and assemblies for the Martin B-26 bomber. Goodyear already has 
1,000 engineers and production men working on bomber parts. They are, at the 
present time, using 300,000 square feet of floor space at their plant in Akron, 
Ohio, and this program is being advanced steadily, so that by tiie latter part of 
this year, Goodyear will be employing 8,000 men on aircraft production work, 
utilizing about 1,000,000 square feet of floor space. Goodyear entered this 
highly technical phase of fighting plane production with 25 years of experience 
in the fabrication of light aircraft metals. To Goodyear has been allocated the 
production of complete wings and all tail surfaces for the Martin B-26. They 
are also building wings and tail surfaces for the Consolidated PB-2Y3. Mr. 
P. W. Litchfield, chairman of the board of the Goodyear Tire & Rubber Co., 
says, "I believe that the command of the air is the most vital need in connection 
with national defense, and we are giving this work priority over any other busi- 
ness." 

HUDSON PRODUCTION 

To the Hudson Motor Car Co. has recently been allocated the aft section of 
the fuselage for the Martin B-26. For several months, the Hudson Co. have 
been building an organization of aircraft experts. They are already building 
ailerons for another company. They have already taken on work for Wright 
Aeronautical totaling severalmillions of dollars. A new Navy contract is under 
way, and $15,000,000 in Government defense contracts will be under production 
at Hudson before the end of 1941. 

Let's not lose sight of the fact that each motor vehicle manufacturer is playing 
his part — a big part — in this defense program. Right now the industry is shipping 
13,000 military vehicles a month to the Army. That's just one task the industry^ 
has shouldered. Before the end of the year, it will have 150,000 men, exclusive 
of those assigned to the bomber program, working on defense production. But 
to conclude my report on the automobile industry's participation on the bomber 
program, here is my final chapter: 

The automotive committee for air defense, a voluntary organization, elected, 
by various groups of automotive industry, has played an important part in the' 
education of automotive engineers and production men to prepare them for the 
huge production job which lies before us. The cooperation from all sources has 
been spontaneous and enthusiastic. No one has refused to do anything asked 
of him, and the staff of this committee has assisted every automotive manufacturer 
to the extent of its ability. We were organized for a definite purpose to assist 
in the allocation of this huge bomber program to the automotive industry, but 
aircraft manufacturers quickly found out that 8505 West Warren, Detn-it, was a 
place where they could get assistance on production already under way prior to 
the bomber progra.n for which the committee was organized, so at least $1,000,000 
of machine shop and die business has been placed in the automotive industry 
through the efforts of this committee. Present production has been speeded up 
by just that much. 

The United States Army Air Corps now has leased additional space at our 
location where, under the direction of Maj. J. H. Doolittle and a very competent 
staff of Air Corps executives, the inspection section, the priorities division, and 
the plant production division is being rapidly organized. 

It's great to be an American. It's wonderful to live in America where men are 
free. It has been a great experience to observe automotive engineers and produc- 
tion executives tackle the job of learning "how" in order that aircraft production 
could drive rapidly ahead. 

I want to live to see the bomber seeds, which we have been sowing, sprout 
and develop and take to the air in order that the aircraft supremacy of the United 
States of America may be supreme and in order that every possible assistance 
may be given to that great, brave country, Great Britain, our first line of defense. 

I want to live to see democracy survive in America and in Great Britain and 
in all other parts of the world where democracy is desired and deserved. 

I want to live to see all "isms" except Americanism disappear from the hearts 
and minds of our citizens. 

I want to live to see whether or not some of the precision tolerances now re- 
quired by the aircraft industry are reflected in the automobile of 1945, and to see 



y322 DETROIT HEARIjSGS 

the results of the mass production methods of the automotive industry reflected 
in the aircraft of 1943. 

I have been a member of the Society of Automotive Engineers for more than 25 
vears and I ask very little other than I live to be its oldest member. 



STATEMENT BY ROBERT W. CONDER, DIRECTOR OF LABOR 
RELATIONS, CHRYSLER CORPORATION 

We expect to be able to recruit substantially all employees necessary for our 
defense program from among our employees of the automobile plants. So far 
we have been able, in the great majority of instances, to place the employee 
transfered on defense work similar to that previously performed by him in the 
automobile plants, so little training prior to placing him on the defense job has 
been necessary. Based on our present defense contracts, we expect to continue 
this procedure where possible, and in all instances give such training as the em- 
ployees selected require to do the defense work. The time we obtain macliinery, 
equipment, materials, engineering data, and other pertinent data affects not so 
much the location of employment opportunities but tbe prospective levels of 
employment opportunities, in that we cannot start defense production involving 
the placing of workers on the same until these things have been obtained. 

/ Employment applicants, Chrysler Corporation, summary of Detroit plants, July 
1, 1940, through June 30, 1941 



Month 



1940: 

July 

August 

September 

October 

November. 
December- 
mi: 

January... 
February.. 

March 

April 

May 

June 

Total... 



Total num- 
ber of 
applicants 



3,437 
11,882 
51, 247 
107, 909 
60, 364 
25, 620 

44,873 
45, 452 
32, 462 
12, 477 
15, 920 
20, 606 



438, 149 



Females 



244 
985 
6,006 
11, 136 
7.908 
2,012 

3.587 
4,619 
3,522 
2,321 
2,754 
3,004 



48, 098 



Colored 



2.925 
13, 180 
8,554 
2,089 
3,319 
3,371 



1 33, 438 



Nonresi- 
dents 



161 
490 
4, 543 
7,191 
9,976 
4,879 

7,262 
13, 546 
12, 949 
4,410 
3,765 
5,249 



74, 421 



Detroit 
residents 



3,276 
11, 392 
46, 704 
100, 718 
56,388 
20, 741 

37,611 
31,906 
19, 513 
8,067 
12, 155 
15, 257 



363, 728 



Total num- 
ber of 
applica- 
tions taken 



651 
2,719 
9,063 
14,447 
8,442 
4,569 

5,145 
4,966 
4,465 
2,277 
2,711 
% 418 



64,873 



DODGE MAIN PLANT EMPLOYMENT APPLICANTS, JULY 1, 1940, THROUGH JUNE 30, 

1941 



1940: 

July 

August 

September 
October..- 
November 
December. 

1941: 

January... 
February. 

March 

April 

May 

June. 

Total... 



1,820 
5,215 
25, 746 
80, 552 
54, 131 
17, 308 

34, 952 

29, 000 

20, 304 

4, 988 

7,226 

7,604 



288, 846 



119 
546 
1,944 
7,464 
6,444 
1,296 

2,091 
2,998 
1,904 
1,124 
1,055 
1,130 



28, 115 



2,312 
11,97 
7, 591 
1,445 
1,789 
1,808 



I 26,915 



101 
2.')3 
2,029 
4,776 
8,765 
4,413 

5,546 
9,240 
9,448 
1,972 
1,154 
1,227 



48,924 



1,719 
4,962 
23. 717 
75, 776 
45, 366 
12, 895 

29, 406 
19. 760 
10, 856 
3,016 
6,072 
6,377 



239, 922 



895 
2,838 
6,693 
4, 457 
1,350 

2,184 

1,016 

531 

195 

885 

1,484 



22, 616 



' Negro applicants were not recorded separately until January 1941. 
totals in relation to colored applicants cannot be made due to this fact. 



An accurate comparison of the 



NATIONAL DEFENSE MIGRATION 



7323 



1. Employment applicants, Chrysler Corporation, summary of Detroit plants, July 
1, 1940, through June 30, 1941 — Continued 

JEFFERSON-KERCHEVAL PLANT EMPLOYMENT APPLICANTS, JULY 1, 1940, 
THROUGH JUNE .30, 1941 



Month 


Total num- 
ber of 
applicants 


Females 


Colored 


Nonresi- 
dents 


Detroit 
residents 


Total num- 
ber of 
applica- 
tions taken 


1940: 
July 


124 
2.645 
7.756 
10. 566 
3. 171 
3,344 

4.556 
3.912 
3,912 
4.153 
5.054 
3.359 


10 

207 

2.194 

2,416 

741 

460 

1,145 
688 
723 
682 

1,213 
742 




2 
120 

45 
146 

88 
216 

795 
1,298 
1.612 
1,588 
1,564 
1.441 


122 
2,525 
7.711 
10. 420 
3,083 
3,128 

3,761 
2,614 
2,300 
2,565 
3.490 
1,918 


69 






507 






1,984 






3,358 






1,715 






2,079 


1941: 


165 
544 
518 
382 
1,120 
669 


1,866 


February .. 


.. 904 




702 




1,027 


May 


836 




554 






Total 


52, 552 


11,221 


1 3, 398 


8.915 


43, 637 


15, 601 







DE SOTO PLANT EMPLOYMENT APPLICANTS, JULY 1, 1940, THROUGH JUNE 30, 1941 



1940: 
July 


100 

508 

6.235 

4,085 

1. 955 

753 

1.338 

2,240 

1,426 

368 

532 

650 


4 
61 
1,497 
693 
256 
93 

215 
254 
200 
72 
92 
100 






100 

508 

3,154 

2.305 

1,097 

638 

869 
1,390 
865 
230 
319 
370 


81 








306 






2,081 

1,780 

858 

115 

469 
850 
561 
138 
213 
280 


574 






649 






352 






212 


1941: 


6 
59 
69 


225 


February. 


103 


March - 


146 




90 


May 


5 
33 


187 


June - 


135 






Total- 


19, 190 


3,437 


1 172 


7,345 


11,845 


2,960 







PLYMOUTH PLANT, EMPLOYMENT APPLICANTS, JULY 1, 1940, THROUGH JUNE 30, 

1941 





129 
871 
6,700 
9,593 
5,000 
2,878 

2,110 
4,010 
1,490 
1,260 
1,350 
2,070 



26 
122 
523 
467 
163 

136 
375 
150 
195 
196 
411 





12 

9 
190 
31 



245 
1,496 
700 
575 
600 
708 






1940: 
July 


129 
859 
6,691 
9,403 
4,969 
2,878 

1,865 

2,514 

790 

685 

850 

1,362 


26 






312 






2.199 






3,053 






1,417 






683 


1941: 


328 
325 
100 
125 
230 
395 


375 


February 


1,003 




290 




169 


May - 


183 




210 






Total.- 


37, 461 


2,764 


1 1, 503 


4,466 


32, 995 


9,920 







' Negro applicants were not recorded separately until January 1941. An accurate comparison of the 
totals in relation to colored applicants cannot be made due to this fact. 



7324 



DETROIT HEARINGS 



1. Employment applicants, Chrysler Corporation, summary of Detroit plants, July 
1, 1940, through June SO, 75^/— Continued 

HIGHLAND PARK PLANT EMPLOYMENT APPLICANTS, JULY 1, 1940, THROUGH JUNE 

30, 1941 



Month 


Total num- 
ber of 
applicants 


Females 


Colored 


Nonresi- 
dents 


Detroit 
residents 


Total num- 
ber of 
applica- 
tions taken 


1940: 

July 


1,264 
2,643 
5,810 
3,113 
2,107 
1,337 

1,917 
5,111 
2,951 
1,708 
1.758 
2,341 


111 
145 
259 
140 




273 
486 
248 
198 
201 




58 
105 
379 
299 
234 
135 

207 
422 
294 
137 
334 
645 


1,206 
2,538 
5,431 
2,814 
1,873 
1,202 

1,710 
4,689 
2,657 
1,571 
1,424 
1,696 


387 


August 




699 


September . . 




1,468 






794 






501 


December 




245 


1941: 


114 
257 
221 
137 
175 
205 


495 




834 


March 

April .. 


511 
796 


May 


620 




873 






Total 


32, 060 


2,061 


1 1, 109 


3,249 


28,811 


8,223 







TANK ARSENAL PLANT EMPLOYMENT APPLICANTS, JULY 1, 1940, THROUGH JUNE 

30. 1941 



1941: 
















1,179 
2.379 


31 
59 


25 
55 


240 
334 


939 
2,045 


1,106 




2,286 




















June . - 


3,098 


139 


248 


817 


2, 281 


1,197 






Total 


6,656 


229 


328 


1,391 


5,265 


4,588 







' Negro applicants were not recorded separately until January 1941. An accurate comparison of the totals 
in relation to colored applicants cannot be made due to this fact. 

• Note.— Reports were not submitted for January. April, and May, 

WARREN AVENUE PLANT 



June 1941- 



1,384 



281 



131 



1,253 



965 



Note.— Employment activities were not organized until June 1941. 

^. Job classification of employment applicants, Chrysler Corporation, Detroit plants, 
5-month period, Feb. j, 1941, through June SO, 1941 



General classifications 



February March 



April 



May 



June 



Total 



I. MALE 

Apprentices 

Clerical 

Inexperienced 

Inspection 

Maintenance 

Metal finishers and polishers — 

Painters and trimmers 

Production machine operators. . 
Production machine repairmen. 

Press operators - 

Supervision 

Tool and die workers 

Welders — 

Miscellaneous 



1,209 

906 

12, 092 



975 
669 

7.217 



645 
644 



947 
1,049 



717 
795 



538 
664 



1,179 
1,"383' 



907 
"2," 146' 



1,246 
"i,'990' 



206 
4,201 
14, 752 



128 
2,113 
10, 082 



222 
2.107 
5,130 



766 

639 

4,083 

118 

396 

499 

160 

727 

32 

1,140 

22 

81 

1,152 

4,226 



611 
951 

4,267 
391 
660 
444 
497 

1,361 
196 
661 
71 
192 
777 

6.065 



4,206 

3,809 

29, 468 

509 

3,258 

3.451 

657 

5.420 

228 

10, 320 

93 

829 

10, 350 

40, 255 



Total male applicants 40, 924 



25. 749 



14. 995 



14. 041 



17, 144 



112,853 



Note.— Figures for this 5-month period are given as representative of the types of work applicants have 
requested or for which they seemed best suited. Inspectors, painters and trimmers, production machine 
repairmen and supervision classifications were not recorded separately until May 1941. 



NATIONAL DEFENSE MIGRATION 



7325 



2. Job classification of employment applicants, Chrysler Corporation, Detroit plants, 
5-month period, Feb. 1, 1P41, through June 30, 1941 — Continued 



Oeneral clissiflcations 


February 


March 


April 


May 


June 


Total 


11. FEMALE 


3,815 

268 

192 

208 

93 


3,474 
284 
128 
246 
90 


2,379 
291 

91 
185 

32 


2,402 
189 

70 
144 

34 


2,347 

224 

121 

198 

25 


14,417 


Clerical -- 


1.256 




602 




981 




274 








4,576 


4,222 


2,978 


2,839 


2,915 


17, 530 








45, 500 


29, 971 


17, 973 


16, 880 


19, 448 


129, 772 







Employment applicants, Chrysler Corporation, Detroit plants, Sept. 8, 1941, through 

Sept. 15. 1941 



Plants 



Dodge units 

Jeflerson Kercheval 

De Soto 

riymouth-- 

Highland Park 

Tank Arsenal 

Warren Avenue — 

Total 



Total 
number of 
appli- 
cants 



678 
252 
189 
260 
490 
1,291 
431 



3,591 



Females 



167 
51 
26 
30 
51 
38 
63 



Colored 



118 
44 
10 
25 
36 
44 



284 



Nonresi- 
dents 



163 
144 

52 
75 
64 
265 
6 



Detroit 
residents 



515 
108 
137 
185 
426 
1,026 
425 



2,822 



Total 
number of 
applica- 
tions 
taken 



30 
18 
42 
75 

153 
1,242 

101 



1,661 



Job classifications of en.plcywcnt applicants, Chrysler Corpcraticn, Detroit plants, 
for the period Sept. 8, 1^41, throvch Sept. 15, 1941 



General classifications 



I. MALE 

Clerical 

Inexperienced-- 

Inspection 

Maintenance ... -. 

Metal finishers and polishers 
Painters and trimmers — 
Production machine opera- 
tors - 
Production machine repair- 
men 

Press operators - - 

Supervision 

Tool and die workers 

Welders - 

Miscellaneous 

Total male applicants,. 

n. FEMALES 

Factory workers 

Clerical - --. 

Stenographers 

Typists 

Office machine operators 

Total female appli- 
cants 

Grand total 



Dodge 
units 



76 
142 

2 
15 

3 



6 
2 

1 
7 
160 



Jefferson 
Kerche- 
val 



678 



18 

109 

4 

1 

21 




De Soto 



Ply- 
mouth 



230 



103 


47 


26 


27 








8 


4 





29 

















167 


51 


26 



30 



260 



High- 
land 
Park 




16 

5 
18 
215 



Tank 
Arsenal 



38 
189 
26 
85 
32 


253 

1 

48 
1 

18 

84 

478 



38 



Warren 
Avenue 



1,291 



1 
22 
16 

9 
33 
187 



368 



63 



431 



Total 



177 
638 

70 
139 
103 

37 

422 

12 

126 

17 

49 

172 

1,203 



3.165 



258 
48 
31 



426 



3,591 



7326 DETROIT HEARINGS 

3 States represented by out-of-town applicants, Chrysler Corporation, Detroit plants, 
Sept. 8 through Sept. 15, 1941 



States 


Dodge 
units 


Jefferson 

Ker- 

cheval 


De Soto 


Ply- 
mouth 


High- 
land 
Park 


Tank Ar- 
senal 


Warren 
Avenue 


Total 


Michigan (outside 
Detroit area) 


58 

21 

16 

9 

12 

6 

5 

11 

1 

5 



1 

? 
1 


2 
1 
3 

2 
1 


3 
• 2 






1 



2 


41 
24 
7 
28 
14 
20 
2 

2 
2 
3 
6 
1 
9 
5 
5 
5 

1 
3 

2 





1 
2 

1 
1 






23 
6 
2 
2 
4 
5 
2 
1 
4 




1 




1 


















1 




20 

10 

10 

10 
5 



3 
5 
2 

8 










2 














17 
6 
8 
2 
7 
3 
7 
2 
3 


1 
1 

2 
1 

1 





1 



1 










129 
6 

25 
10 
14 
13 
12 
1 
4 
4 
11 
3 
2 
1 
2 
3 
3 
3 
4 

6 

1 
1 
2 

1 
1 

1 







2 



2 



2 


























248 
73 




68 


Kentucky 


63 


Ohio - 


56 


Pennsylvania 


47 

28 




17 




17 




16 




16 




13 


South Carolina 

Alabama 


12 
12 




10 


North Carolina 

West Virginia 


9 

8 
7 




6 




6 




6 


Texas 


4 




3 


Connecticut 


3 
3 


North Dakota.. 

South Dakota 


3 
3 
2 


Wyoming 


2 


Colorado 
















1 
2 











3 


Mississippi 


2 


Total 


164 


185 


52 


75 


64 


265 


6 


771 







A Hires, Chrysler Corporation, Detroit plants, August 1, 1940, through July 31. 

1941 



Month 


Dodge 
main 


Dodge 
truck 


Dodge 
forge 

7 
82 
52 
19 
16 

29 
3 

10 
2 
5 

11 
3 


Am- 
plex 


Jeffer- 
son 


Kerch- 
eval 


De 
Soto 


Ply- 
mouth 


High- 
land 
Park 


Tank 
arse- 
nal 


War- 
ren 
Ave. 


Total 


1940 

August 

Septen.ber 

October 

November 

December 

1941 

January 

February 

March 

April 


182 

1,122 

3,275 

862 

216 

135 
260 
143 

67 
74 
132 
75 


2 

344 

305 

516 

35 

103 
156 
149 

474 

175 

91 

9 


16 
13 
20 
8 
12 

43 

19 

41 

2 

4 
11 
10 


142 
992 
1,012 
425 
241 

124 
158 
171 
286 
210 
39 
19 


2 

1,016 

503 

155 

50 

47 

62 

30 

300 

118 

13 

7 


24 
359 
250 

37 
6 

6 

7 
2 
100 
105 
73 
38 


33 
936 
344 
223 

75 

78 
58 
16 
2 
307 
130 
25 


353 
654 

368 
82 
292 

481 ■ 
175 

154 
149 
165 
154 






761 






5,518 


... 




6,129 


32 
37 

31 

75 
142 
302 
431 
375 
602 


8 
10 

8 
15 
19 
44 
67 


2,359 
980 

1,085 
983 
789 

1,704 


May 




June 


1,084 


July 


1,009 


Total... 


6, 543 


2,359 


239 


199 


3,819 


2,303 


1,007 


2,227 


3,104 


2,027 


171 


23.998 



NATIONAL DEB^ENSE MIGRATION 



7327 



5 Separations, Chrysler Corporation, Detroit plants, Aug. 1, 1940, through 

July 31, 1941 



Month 


Dodge 
Kain 


Dodge 
truck 


Dodge 
forge 

10 
13 
24 
10 
20 

20 
15 
87 
31 
21 
25 
187 


Air.- 
ple.x 

14 
8 
4 

11 
4 

10 
14 
14 
32 
38 
3G 
9 


Jeffer- 
son 

112 
121 
224 

194 
257 

317 
256 
344 
128 
423 
364 
2,067 


Kcrch- 
eval 

134 
79 
211 
180 
192 

231 
184 
272 
51 
206 
263 
3.014 


De 
Soto 


Ply- 
mouth 


High- 
land 
Park 


Tank 
arse- 
nal 


War- 
ren 
Ave. 


Total 


1940 

August 

September 

October 

November 

December 

1941 

January 

Fehru^iry 

March 

April 


379 
435 
568 
495 
776 

847 
930 

3,498 
861 
790 

1,079 
15.090 


1,209 
75 
39 
57 
50 

78 
77 
4,59 
101 
136 
122 
136 


35 
50 
112 

127 
227 

143 
80 
127 
113 
120 
128 
1,640 


213 
291 
205 
234 
194 

195 
215 
772 
267 
575 
1.669 
7,086 


72 
153 
307 
122 
106 

216 
203 
363 
288 
193 
254 
260 




2,178 






1 , 225 






1,694 






1,430 






1,826 






2,057 






1,974 


12 

18 
48 
68 
74 


2 


5,948 
1,890 




2, 550 




4,008 


July 


29, 565 


Total.-. 


25, 748 


2,539 


463 


194 


4,807 


5,017 


2,902 


11,916 


2. 637 


220 


2 


56, 345 



6. Number of employees for past 12 months segregated according to whether employed 
on defense or nondefense production, salary and hourly employees, Chrysler Cor- 
poration, Detroit plants 



mo 



September- 
October 

November. 
December. 



January. _ 
February. 

March 

April 

May 

June 

July 

August... 



Number of 
employees, 

defense 
production 



7,072 
7,564 
8,161 



9,003 
9,182 
9,115 
10, 170 
10, 903 
11,292 
12, 101 
14, 825 



Number of 
employees, 
nondefense 
production 



55, 112 
60, 705 
61,541 
61,025 



61, 176 
61,212 
57, 265 
56, 693 
57,047 
55, 729 
30, 264 
46, 593 



Combined 

total 
employees 



62, 184 
68, 269 
69, 702 
69, 854 



70, 179 
70, 394 
66, 380 
66, 863 
67, 950 
67, 021 
42, 365 
61,418 



Note —All employees engaged on truck work have been included in defense production in conformance 
with instractions of Michigan Unemployment Compensation Commission that such employees be consid- 
ered defense workers. This report cannot be entirely accurate due to the fact that some employees divide 
their time between defense and nondefense work, and some employees at the truck plant devote their time 
to the production of civilian trucks. 



60396— 41— pt IS- 



-IS 



7328 



DETROIT HEARINGS 



7. Estimated number of employees required for coming 12 months on defense and non- 
defense production, salary and hourly einployees, Chrysler Corporation, Detroit 
plants 



mi 

September 

October 

November 

December --- 

191^Z 

January 

February 

March 

April 

May 

June 

July 

August 



Number of 
employees, 

defense 
production 



17, 522 
18,061 
19,016 
20, 090 



22,315 
23, 591 
24, 785 
25, 394 
25, 928 
26, 682 
27, 257 
27, 654 



Number of 
employees, 
nondefense 
production 



46, 456 
46, 699 
44, 960 
32,317 



32, 177 
32, 152 
31,138 
31,138 
31, 103 
30, 286 
30, 286 
30, 286 



Combined 

total 
employees 



63, 978 
64, 760 
63, 976 
52, 407 



54, 492 
55, 743 
55,923 
56, 532 
57, 031 
56, 968 
57, 543 
57, 940 



Note. — All employees engaged on truck work have been included in defense production in conformance 
with instructions of Michigan Unemployment Compensation Commission that such employees be consid- 
ered defense workers. Thio report cannot be entirely accurate due to the fact that some employees divide 
their time between defense and nondefense work, and some employees at the truck plant devote their time 
to the production of civilian trucks. 

8. Transfers from nondefense to defense work for the past year, salary and hourly 
employees, Chrysler Corporation, Detroit plants 



1940— September 1, 568 

October 1,159 



November. 

December. 

1941 — January. _ . 

February.. 

March 

April 



375 
298 
37 
114 
234 
376 



1941- 



-Continued 

May 529 

June 337 

July 1, 174 

August 2,411 



Total 8,612 



Note.— All truck plant employees are considered as transfers to defense activities in conformance with 
instructions of Michigan Unempioyment Commission that such employees be considered defense workers. 

This report cannot be entirely accurate due to the fact that some employees divide their time between 
defense and nondefense work, and some employees at the truck plant devote their time to the production 
of civilian trucks. 



NATIONAJL DEFENSE MIGRATION 



7329 



STATEMENT BY R. I. ROBERGE, OFFICE OF EDSEL FORD, FORD 

MOTOR CO. 

Analysis of Industry 

The following tabulations have been n.ade from employees' record cards as 
requested : 

Tables showing 1,000 employees represent en.ployees picked at random from 
the record files. 

Tables showing 1,500 en.ployees represent en.ployees whose records show place 
of birth to be other than Detroit only. 



(a) Last previous employment 


of Ford Motor Co. employees 






Place of 
last em- 
ployment 


Num- 
ber of 
em- 
ployees 




Place of 
last em- 
ployment 


Num- 
ber of 
em- 
ployees 




1 

1 

4 


760 

117 
32 
90 


Michigan less than 100 miles 


2 
3 
4 




Michigan less than 100 miles 


272 


Rest of Michigan 


87 


Rest of Michigan 


Others 

Total 


1,141 










1 500 


Total 




S99 
















Industry 
of last em- 
ployment 


Num- 
ber of 
em- 
ployees 




Industry 
of last em- 
ployment 


Num- 
ber of 
em- 
ployees 




1 
2 
3 


315 

17 

667 


Automobile.- --- 


1 
2 
3 


162 




Agricultural 

Others 


155 




1,183 




Total 




Total 




999 




1,500 














Industry 
of last em- 
ployment 
before rehire 


Num- 
ber of 
em- 
ployees 




Industry 
of last em- 
ployment 
before rehire 


Num- 
ber of 
em- 
ployees 




1 
2 
3 


498 

5 

156 


Automobile - 


1 
2 
3 


827 




Agricultural 

Others 

Total 


11 


Others 


155 






Total 




659 




993 














No. of 

em- 
ployees 




No. of 
em- 
ployees 




1,000 


Male - 


1.497 








3 




714 

277 

9 


Total 




Marital status: 


1,500 


Single 


Marital status: 








1,170 


Total 


1,000 


Single 


307 








22 






1 




Total 






1,500 









7330 DETROIT HEARINGS 

(6) Origins of em'ployees of Ford Motor Co., from records selected at random 

1,000 EMPLOYEES 



State or country of birth 


Number of 
employees 


State or country of birth 


Number of 
employees 


Alabama . . - 




23Michi<ran 


330 






7 






16- 


Arkansas 


14Missouri 


14 






1 


Austria 


3North Carolina -. 


4 


Beleium 


2North Dakota 


1 






3 


California 




18 


Canafla ... 




1 


Colorado 


30hio 


25 




20klahoma 


3 


Czechoslovakia. 




61 


Denmark . . 


IPoland 


42 


District of Columbia 


2Porlugal 


1 


England -_. 




IQ 


Florida. 




9 


Georgia - - - - 


26Scotland 


18 


Germany 


20South Carolina 


9 




SSouth Dakota 


2 


Holland 


2Spain .. 


1 


Hungary - 


12Sweden 


3 




25Syi-ia 


5 


Indiana 


14 


Iowa ...-. - 


9Texas 

9Turkev 

43Ukraine 


^ 


Ireland . 


4 


Italy 


1 


Kansas - --_ 


SVirginia _ - - . . 


S 


Kentucky .. 


23 Washington 

6West Virginia 


1 


Lithuania -. 


9 




10 


Maryland 


1 Wyoming 

SYugoslavia 

5 
1 


1 


Maine . . 


5 






Mexico - 


1,000 



(c) Origins of Ford Motor Co. employees, from records showing place of birth other 

than Detroit 

1,500 EMPLOYEES 



State or country of birth 


Number 
of em- 
ployees 


State or country of birth 


Number 
of em- 
ployees 


Alabama 


69 

32 

2 

6 

6 

1 

11 

55 

121 

92 

26 

19 

105 

17 

24 

12 

9 

33 

33 

63 

4 

28 


North Dakota. . 


6 


Arkansas _ 


New Hampshire 

New Jersey 


4 


California 


10 


Colorado -. 




3 


Connecticut _ __ . _- __ 


New York _ ._ _ .__ . 


71 


District of Columbia _ 


Nebraska 


8 


Florida 


Ohio . 


164 


Georgia 


Oklahoma 


14 


Illinois . . 


Oregon . 


1 


Indiana 




201 


Iowa 


Rhode Island 


5 


Kansas . _. ..- . 


South Carolina . . 


22 


Kentucky ... 


South Dakota. ... . 


5 


Louisiana . . 


Tennessee 

Texas . . 


104 


M assachussets 


17 


Maryland . .. 


Virginia 

Vermont 


24 


Maine 


6 


Minnesota 

Mississippi ,. 


West Virginia. 

Washington . 


34 
2 


M issouri 


Wisconsin 


31 






North Carolina 


1,500 







NATIONAL DEFENSE MIGRATION 
(d) Age of Ford Motor Co. employees 

1,000 EMPLOYEES • 



7331 



Date of birth 


Number 
of em- 
ployees 


Date of birth 


Number 
of em- 
ployees 


Date of birth 


Number 
of em- 
ployees 


1867 


1 
1 
2 
3 
3 
3 
5 
6 
5 

6 
11 

8 
15 

2 
11 
24 
27 
18 


1889 


19 
21 
24 
37 
23 

2 
26 
30 
23 
26 
22 
34 
28 
19 
31 

1 
30 
34 
26 


1908 


23 


1868 


1890 


1909.... 


22 


1870 


1891 


1910 


26 


1871 


1892 


1911 


18 


1872 


1893 


1912 


29 


1873 


1894 


1913 


21 


1875 


1895 


1914. _ 


1 


1876 


1896 


1915 


33 


1878 


1897 


1916 


27 


1879 


1898 


1917 


43 


1880 


1899 


1918 


17 


1881 


1900 


1919... 


19 


1882 


1901 


1920 


39 


1883 


1902 


1921 


33 


1884 


1903 


1922 


28 


1885 


1904 


1923 


7 


1886 


1905 


Total 




1887 


1906 


1,000 


1888 


1907 --- 













1,500 EMPLOYEES J 



1863 


1 
2 
5 
1 
1 
2 
2 
4 
4 
8 
7 
5 

10 
9 
7 
14 
10 
13 
15 
21 


1886 


17 
31 
25 
42 
24 
31 
35 
29 
47 
48 
57 
51 
53 
41 
55 
■ 52 
44 
42 
64 
47 


1906 


40 


1867 


1887 .... 


1907 


47 


1868 - - 


1888 


1908 


44 


1869 


1889 . . .. 


1909 


37 


1870 


1890 

1891 


1910 


28 


1871 


1911 


25 


1872 


1892 


1912 


27 


1873 


1893 


1913. 


42 


1874 


1894 


1914 


37 


1875 


1895 


1915 


39 


1876 


1896 


1916 


20 


1877 


1897 . . . 


1917 


32 


1878 


1898 


1918- 


17 


1879 


1899 


1919. 


23 


1880 


19' 


1920 


20 


1881 


1901 


1921 


32 


1882 


1902 


1922 


22 


1883 


1903 - 


1923 


2 


1884 


1904 


Total. 






1885 


1905 


1,500 











' From records taken from files at random. 

' From records of employees showing place of birth other than Detroit. 

(e) Age of Ford Motor Co. employees when hired 

1,000 EMPLOYEES' 



Age when hired 


Number 
of em- 
ployees 


Age when hired 


Number 
of em- 
ployees 


Age when hired 


Number 
of em- 
ployees 


14 


1 
2 
4 

82 
98 
51 
77 
60 
63 
49 
35 
25 
39 
43 
30 
34 


31 


22 
20 
17 
30 
25 
24 
21 
20 
16 
12 
10 
14 
10 
9 
8 
8 


47 


8 


16 


32 


48 


4 


17 


33 


49 


8 


18 


34 .- 


50 


5 


19 


35 


51 


1 


20 


36 


52 


4 


21 


37 .. -- ... .. 


53 


2 


22 


38 


54 . 


1 


23 


39 


55 


3 


24 


40 


56 


1 


25 


41 


57 


1 


26 


42 


60 


1 


27 


43 


61 . 


1 


28 


44 . 


65 


1 


29 


45 


Total 




30 


46 


1,000 











' From records taken from files at random. 



7332 



DETROIT HEARINGS 



(e) Age of Ford Motor Co. employees when hired — Continued 

1,500 EMPLOYEES" 



Age when hired 


Number 
of em- 
ployees 


Age when hired 


Number 
of em- 
ployees 


Age when hired 


Number 
of em- 
ployees 


16 . .- 


4 

5 
44 
68 
78 
131 
115 
89 
78 
82 
72 
76 
75 
39 
61 
38 


32 


52 
50 
31 
42 
29 
35 
27 
23 
14 
12 
19 
19 
14 
12 
13 
10 


48 


13 


17 


33 - 


49 


7 


18 


34 


50 


3 


19 . . 


35 - 


51 


3 


20 - . 


36 . 


52 . . 


e 


21 


37 


53 . . 




22 


38 


54 




23 


39 


55 




24 


40 


56 




25 . . 


41 


57 




26 


42 -. 


58 




27 


43 


Total 




28 


44 


1,500 


29 . 


45 






30 


46 




31 .... 


47 









' From records of employees showing place of birth other than Detroit. 

(/) Length of employment, Ford Motor Co. 

1,000 EMPLOYEES » 



Year hired 


Number 
of em- 
ployees 


Year hired 


Number 
of em- 
ployees 


Year hired 


Number 
of em- 
ployees 


1908 


1 

3 

2 

6 

2 

12 

28 

4 

16 

32 

21 


1921 


2 
£8 
76 
17 
SO 

4 
11 
106 
28 
17 
25 


1932 . 


28 


1910... 


1922 


1933 


4 


1912 


1923 ,. 

1924 . . 


1931 


64 


1913 . 


1935 


67 


1914-. 


1925 


1936 


06 


1915 


192'i 


1937 


38 


1916 


1927 


1938 


13 


1917. 


1928 


1939 


67 


1918 


1929 


1940 

194L 


77 


1919 


1930 


05 


1920 . 


1931 


Total . 








1,000 









1,500 EMPLOYEES » 



1913 


12 
2 
14 
30 
4 
11 
58 
38 
52 
216 


1924 


54 
108 

9 

12 

229 

67 

5 
10 
17 

6 


1934 


51 


1914 


1925 . 


1935 


83 


1915 


1926 . 


1936 


76 


1916 


1927 


1937 


37 


1917 . . 


1928 


1938 

1939 


3 


1918 


1929 


98 


1919 

1920. 


1930 

1931 


1940 

1941 


87 
121 


1922 

1923 


1932 

1933. 


Total 




1,500 









' From records taken from files at random. 

• From lecords of employees showing place of birth other than Detroit. 



NATIONAL DEFENSE MIGRATION 
(g) Duration of reemployment, Ford Motor Co. 



7333 



Year of first rehire 


Number of 
employees 


Year of first rehire 


Number of 
employees 


1916 


1 

2 

4 

2 

4 

6 

6 

4 

4 

148 

59 

79 

101 

52 

36 

9 

23 

65 

13 

25 


1920 

1922 

1923 ---- 

1924 


2 


1922 


2 


1923 


6 


1924 


7 


1925 


1925 

1926 


4 


1027 


6 


1928 - 


1927.-. 

1928 


4 


1929 


7 


1930 - -- 


1929 


9 


1931 


1930 


13 


1932 


1931 


286 


1933 


1932 

1933- - 


146 


1934 


110 


1935 . 


1934 

1935 


152 


1936 


71 




1936 


37 


1938 


1937 

1938 .- 


6 


1939 


24 


1940 


1939 


64 




1940 


18 




1941 


28 


Total 


643 


Total -- 






1,002 








Year of second rehire 


Number of 
employees 


Year of second rehire 


Number of 
employees 


1924 


1 

15 
12 
75 
75 
27 
15 
10 

8 
75 

6 
28 


1922 -..- 


1 


1931 


1924 


1 




1925 


1 


1933 


1930 . . 


1 


1934 


1931 

1932 


31 


1935 - 


20 


1936 


1933 


137 


1937 


1934 


147 


1938 


1935 . 


58 


1939 


1936 

1937 


26 


1940 


3 


1941 


1938 


7 




1939 


120 


Total 


347 


1940 


17 




1941 


9 




Total 






579 









Miscellaneous Studies 

Our latest age count was taken Septeir.ber 30, 1937, at which tiir.e there were 
85,967 en.ployees, and there are approxin ately that nun.ber on the rolls now. 

Using this report and allowing for the 3 years elapsed, the following figures 
would be approxirr.ately correct: 

En-.ployees 85, 967 

Employees 40 years or older ._ _ 45, 482 

Percent of men 40 years or older 52^^o 

There are 9,800 disabled men employed at the Rouge. 

There are now 10 m.en at the Ypsilanti plant whose ages range from. 66 to 80 
with an average age of 70 years. The average length of service on these men is 
9 years. 



7334 



DETROIT HEARINGS 



We have no figures compiled as to the age of the employees who have been here 
from 15 to 30 years but the following figures are con .piled from a report n.ade 
March 13, 1939, showing length of service of employees: 



Years of service: 
15 



16. 
17_ 

18. 
19. 
20. 
21. 
22_ 
23. 
24. 
25. 



Number of 


employees 


3, 


203 


1, 


220 


3, 


876 


3, 


429 




97 


1, 


691 


2 


454 


1, 


096 




312 


1, 


301 




844 



Years of service: 
26 



27. 
28- 
29. 
30. 
31. 
32. 
33- 
34- 



Number of 
employees 

267 

425 

185 

42 

25 

29 

17 

6 

1 



Total 20,520 



(a) Ages of employees as of Sept. SO, 1937, Ford Motor Co. 

[Includes Rouge, Highland Park, Flat Rock, Northville, Phoenix, Waterford, Plymouth, Nankin Mills, 
Ypsilanti, Newburg, and Dundee] 



Age: 





Number 






of 






employees 


Age: 


17 


3 


41 


18 


744 


42 


19 


. . 1, 599 


43 


20 


1,876 


44 



21 2,198 



2, 756 
2,815 
2,681 
2,325 

26 2,034 

27. 



22. 
23. 
24. 
25. 



1, 966 

28 1,823 

29 2,069 

30 2,113 

31 2,121 

32 2,044 

33 2,223 

34 2,253 

35 2,299 

36 2,543 

37 3,023 

38 2,342 

39 2,594 

40 2,724 



Number 

of 
employees 

2,871 

2,921 

2,929 

2,575 

45 2,550 

46 2,307 

47 2,421 

48 2,151 

49 1,956 

50 1,681 

51 1,535 

52 1,290 



53- 
54_. 
55_. 
56.. 
57.. 
58-. 
59.. 
60-. 
61.. 
62.. 
63.. 
64.. 



179 
990 
869 
777 
705 
528 
386 
344 
317 
244 
209 
135 



65. 
66. 
67- 
68- 
69. 
70- 
71. 
72. 
73. 
74. 
75. 
76- 
77. 
78- 
79. 
80. 
81. 
82. 
83. 
84. 



Number 

of 
employees 

138 

153 

128 

108 

82 

54 

40 

31 

21 

22 

13 

13 

9 

8 

7 

5 

] 

2 

1 

3 



Total 85,967 



NATIONAL DEFENSE MIGRATION 



7335 



(6) Place of birth and citizenship of persons at present employed 

[Includes Rouse, Hisjhland Park, Flat Rock, Northville, Phoenix, Waterford, Plymouth, Nankin Mills, 
Ypsilanti, Newburg, Dundee, Sharon Mill, Milan, Saline, Milford, Brooklyn, Manchester, and 
Marine] 





Count as 

of place of 

birth 


Count by 

present 

citizenship 




Count as 

of place of 

birth 


Count by 

present 

citizenship 




2 

22 

1 

51, 834 

10, 256 

44 

23 

544 

2 

28 

634 

106 

28 

28 

92 

3,574 

1 

14 

1 

3 

4 

12 

317 

115 

3 

10 

2,053 

2 

38 

153 

95 

1,076 

256 

15 

98 


None 

7 

None 

73, 706 

10, 256 

17 

5 

92 

2 

1 

73 

14 

None 

7 

26 

745 

None 

14 

1 

None 

None 

2 

41 

9 

3 

1 

358 

1 

4 

10 
14 
68 
52 
None 
5 


Honduran 

Hungarian 

Indian 

Irish . 


1 

1,244 

43 

796 

4,820 

15 

4 

413 

16 

424 

570 

225 

45 

1 

101 

9 

4 

3,513 

15 

39 

808 

886 

1,885 

236 

232 

49 

478 

396 

84 

2 

70 

89 


1 


Albanian 

Algerian 


233 

16 
59 






1,079 


Arabian 


Jamaican 

Japanese 

Jugo-Slavian 


2 

4 




71 




Latvian 

Lithuanian .. .- 


1 




68 




Maltese - 


163 




Mexican^ .. - . 


157 




Newfoundlander _- 


3 




New Zealander 

Norwegian. 


None 




7 


Canadian 


Persian 

Peruvian. - - 


2 

1 




Polish 


556 




Puerto Rican ... 


3 


Costa Rican .. 


Portuguese 

Rumanian 


11 




184 




Russian - 


146 




Scotch . . . 


259 


Danish 


Spanish 

Swedish.. _ 


96 




21 




Swiss... -- 


6 


English 


Syrian . - 


126 




Turkish 


143 




Ukranian 


11 




Uraguayan 


1 




Welsh 


3 




West Indian 


30 




Total 




88, 997 






88, 997 


Hollander 











Citizens of United Ssates of America- 
Aliens (noncitizens) 



Total..- 

Note.— Salary and ofEce-roU employees not included. 



83, 962 
5,035 



88, 997 



Analysis of working force of the Ford Motor Co. 



Year and employees 


January 


February 


March 


April 


May 


June 


1937: Production.. 


42, 265 
38,214 
13, 578 
26, 525 
29, 426 
34,010 
38, 531 
40, 243 
34. 422 

43, 331 


41, 660 
38, 109 
12. 592 
29, 546 
24, 548 
31, 148 
34, 339 
38. 842 
35,612 
43, 673 


42, 002 
38, 144 
10. 295 
29, 225 
22, 146 
29, 997 
32, 886 
38, 054 
37, 536 
44, 827 


42, 693 

38, 530 
11.398 
23, 538 
26, 960 
34, 365 
33, 064 

39. 761 
20,114 
28, 904 


41. 273 
38.911 
12.053 
21, 009 
22, 193 
32, 491 
28,513 
38, 810 
45, 746 
51. 152 


37, 402 
36,614 


1938: Production 


11.699 


Nonproduction - 


21, 642 


1939: Production 


23, 280 


Nonproduction 

1940: Production 


33, 836 
27,715 
40, 554 


1941: Production 


44, 660 


Nonproduction 


51,601 






Year and employees 


July 


August 


September 


October 


November 


December 


1937: Production 

Nonproduction .- . 


22, 343 
32, 308 
10, 458 
21, 499 

23. 491 

36, 087 
18. 421 
40, 122 

37, 921 
47, 849 


28. 064 
33. 951 
8,213 
22, 294 
15, 233 
38, 089 
18, 006 
38, 535 


27, 440 
42, 177 
13. f.95 
28,215 
27, 542 
39, 890 
29, 208 
41. 322 


29, 093 
41. 647 
19, 533 
31,058 
3.5, 829 
40, 104 
34. 307 
42,061 


33. 123 
40. 939 
21,811 
31, 553 
39, 041 
41,078 
36, 704 
44, 076 


26, 887 
35, 859 


1938: Production 


27. 977 


Nonproduction 

1939; Production 


32, 993 
39, 418 


Nonproduction . 


41, 256 


1940: Production 


33, 359 


Nonproduction 


43, 199 


1941: Production 





























7336 



DETROIT HEARINGS 

Estimated employment by months 



Defense 



Non- 
defense 



September 1941 
October 1941.. 
November 1941 
December 1941 . 

Total.... 




39, 900 



85, 096 
79, 139 
49. 892 
46, 616 



260, 743 



STATEMENT BY H. W. ANDERSON, PRESENTED BY C. E. WILSON, 
PRESIDENT, GENERAL MOTORS CORPORATION ' 

General Motors Corporation, 

Detroit, Mich., September 22, 19U- 
Mr, John W. Abbott, 

Chief Field Investigator, House Committee Investigating 
National Defense Migration, 

Washington, D. C. 
Dear Sir: I am herewith submitting a signed copy of report prepared by 
H. W. Anderson in response to your several inquiries. 

The forecasts have been based upon the present defense contracts of the cor- 
poration and the allocations for civilian production. These allocations, are, of 
course, contingent upon the corporation's ability to secure the needed materials. 
There is real danger that shortages in supply may force an even greater curtail- 
ment in employment for civilian production than that forecast. 

For years General Motors has been cooperating with the Army and Navy in 
the design and manufacture of military material. As a result the corporation 
has substantial defense contracts which will serve to partially offset the effect of 
the ordered curtailment in passenger-car business. Although substantial, these 
defense contracts are not large in proportion to the capacity of the General Motors 
Corporation to serve in the defense effort. 

You will note from Mr. Wilson's talk, in the Problems ot Conversion section, 
that although General Motors normally produces 8 percent of all the durable 
goods in the United States, the corporation has been able to secure only 4}-^ 
percent of similar defense business. 

While approximately 40,000 employees throughout the United States are now 
producing defense materials, and present schedules call for an increase in this 
employment at the rate of 5,000 a month, this is inadequate to offset the mini- 
mum expected decline in employment due to the restriction of the automobile 
production. 

Yours truly, 

B. D. Ktjnkle, Vice President. 

1 On pages followins appear excerpts and statistical material from the report, a complete copy of which is 
held in committee files. 



NATIONAL, DEFENSE MIGRATION 



7337 



Actual and forecast employment of hourly and salaried General Motors employees in 

Michigan cities 



Bay City 

Detroit - 

Flint 

Grand Rapids 

Ionia 

Lansing 

Pontiac 

Saginaw 

Total... 



Civilian 



Actual 



June 
30 



2,209 
36, 789 
45, 006 

2,978 

349 

12,220 

15, 923 

9,785 



125, 259 



July 
31 



2,177 
29, 86S 
43, 727 

2,330 

273 

11, 766 

15, 198 

9,479 



114,818 



August 
31 



1.379 

25, 295 

26. 491 

2,406 

265 

5,130 

9,033 

7.027 



77, 026 



Forecast 



Sep- 
tember 
30 



2,100 
28, 900 
38, 300 

2,100 

200 

10. 800 

13, 800 

9,000 



105, 200 



Octo- 
ber 31 



2,100 
29, 400 
40, 000 

2,100 

200 

11,100 

14, 300 

9,000 



108, 200 



No- 
vember 
30 



2,100 
28, 300 
39, 300 

1,900 
200 

9,100 
10. 400 

8,800 



100, 100 



Decem- 
ber 31 



1.900 

25. 400 

28, 700 

1,900 

200 

7.500 

9,900 

6,700 



82, 200 



March 
31 



1,900 
23, 700 
26. 000 

1.600 
200 

6.800 
10,000 

7,300 



77,500 



June 
30 



1,700 

20,600 

20. 500 

1,300 

100 

6,600 

9.800 

7,300 



67, 900 













Defense 












Actual 


Forecast 




1941 


1941 


1942 




June 
30 


July 
31 


August 
31 


Sep- 
tember 
30 


Octo- 
ber 31 


No- 
vember 
30 


Decem- 
ber 31 


March 
31 


June 
30 


Bay City .. 


17 
6.147 
2.709 

72 


10 

6.753 

2,958 

123 


41 

7,976 

3,578 

180 


40 

10. 700 

4,200 

200 


20 

11.500 

4,300 

200 


30 

11.800 

4,500 

200 


200 

13, 100 

4.400 

200 


200 

10. 200 

4,500 

200 


400 


Detroit .. .. - 


11.300 


Flint 


4.800 


Grand Rapids 


200 






Lansing 


1,182 
304 

1.488 


1,202 

566 

1,532 


1,281 

696 

2,004 


1.400 

900 

2,400 


1,800 
1.200 
2.800 


2.100 
1.400 
2,800 


2,100 
1,500 
2,900 


2.100 
2.1)00 
2,900 


2,100 


Pontiac 


3.000 


Saginaw 


2,900 






Total.- 


11,919 


13.144 


15. 756 


19, 840 


21. 820 


22, 830 


24. 400 


22. 100 


24. 700 



Total 



Actual 



1941 



June 
30 



July 
31 



August 
31 



Forecast 



1941 



Sep- 
tember 
30 



Octo- 
ber 31 



No- 
vember 
30 



Decem- 
ber 31 



March 
31 



June 
30 



Bay City 

Detroit 

Flint 

Grand Rapids 

Ionia 

Lansing 

Pontiac 

law 

Total 



2,226 
42. 936 
47, 715 

3,050 
349 
13, 402 
16, 227 
11,273 



2.187 
36, 621 
46, 685 

2,453 
273 
12, 968 
15.764 
11,011 



1,420 

33. 271 

30. 069 

2.586 

265 

6,411 

9,729 

9,031 



2.140 
39, 600 
42. 400 

2,300 
200 
12. 300 
14, 700 
11. 400 



2,120 
40. 900 
44.300 

2.300 
200 
12, 900 
15,500 
11,800 



2.130 
40, 100 
43, 800 

2.100 
200 
11,200 
11.800 
11,600 



2.100 
38, 500 
33, 100 

2,100 
200 

9.600 
11,400 

9.600 



137, 178 



127, 962 



92, 782 



125, 040 



130, 020 



122, 930 



106,600 



2,100 
31, 900 
25, 300 

1.500 
100 

8,700 
12, 800 
10, 200 



92. 600 



Note.— Includes hourly and salaried employees in manufacturing plants only. Excludes all sales and 
distribution employees and all service organization employees, such as G. M. A. C, G. E. I. C, United 
Motors, etc. Excludes Yellow Truck. 



7338 



DETROIT HEARINGS 



The estimates given above are based upon the attached tentative allotment 
provided by the Office of Production Management for passenger-car production.* 
Truck production was estimated on the basis of 1941 volume. Defense as tabu- 
lated includes all known direct and first degree indirect defense production, 
including civilian type items destined for military establishments, or for further 
fabrication into items of military equipment. It does not include articles for 
defense housing or vehicles necessary to transport defense plant workers or other 
second degree defense production. 

The projections of defense emploj^ment are based on contracts on hand and 
under negotiation which have reached the stage where a definite time, place, and 
quantity of manufacture can be established. The large tank order now under 
consideration for General Motors is excluded. The Chevrolet contract to produce 
Pratt & Whitney engines has also been omitted. This will employ about 1,000 
additional persons in Detroit, Bay City, and Saginaw by July 1942. 

In preparing the projections of employment, the hours of workers on civilian 
production were based on the principles set forth in C. E. Wilson's letter No. 64 
to general managers, attached.^ Hours varied between plants as dictated by the 
necessities of balancing production, the amount of automotive type defense 
business in prospect, and the number of employees with seniority. 

Defense employment was projected on expected hours at the time this report 
was prepared. In some cases the limitations of productive equipment and the 
exigencies of maximum production necessitated a work week beyond 40 hours, 
even though there were unemployed General Motors workers in the same city. 

The Detroit News reports on September 18 that the United Automobile Work- 
ers, Congress of Industrial Organizations has moved to cooperate in four-shift 
operation of defense plants, proposed bv Mr. Wilson on April 30. 

This four-shift operation will permit (1) a substantial increase in the total 
man-hours of work per week on defense production, and (2) shorter shifts in 
bottleneck operations, which will make it possible to give jobs to a few more men. 
Considering that bottleneck departments are now averaging 135 hours per week 
and that a maximum would be 157>^, an increase of over 15 percent in weekly 
hours and in employment seems possible under the four-shift operation. 

Location of most recent employment of persons seekinp jobs in selected General Motors 

plants, Sept. 11-17, 1941 ' 





Detroit 


Flint 


Previous employ- 
ment 


Cadillac 


Gear & A.xle 


Diesel 


Biiick 


Chevrolet 




Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 
















130 

7 

66 


59 

3 

30 


57 

1 

16 


62 


Detroit 

Other Michigan 

Alabama 


604 
43 

2 

1 
2 


86 
6 


87 
8 

1 


87 
• 8 

1 


93 
8 


77 
6 


1 

18 


Arkansas 






2 
2 


1 
1 


5 
2 


6 














2 


Florida 








1 
1 
2 

1 
1 


1 
1 
2 

1 
1 






















Illinois 


4 


1 






2 
2 


1 

1 


1 


I 
























Kentucky 


10 


1 


1 
1 


i 
1 


























1 
















Minnesota 








2 


2 






i 


1 



1 Based on representations of applicants. 



1 See p. 7340. 
s See p. 7342. 



NATIONAl, DEFENSE MIGRATION 



7339 



Location of most recent employment of persons seeking jobs in selected General Motors 
plants, Sept. 11-17, 1941 — Continued 





Detroit 


Flint 


Previous employ- 


Cadillac 


Gear & Axle 


Diesel 


Buick 


Chevrolet 




Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 




2 

1 
2 
1 
8 
4 
2 
2 
9 
1 








2 
1 


2 
1 


6 


3 


2 


2 












New Jersey 






















1 
1 
2 


1 
1 
2 


1 
1 




2 
2 


2 




1 

1 






2 


Pennsylvania 

South Carolina 


i 


1 
































1 






2 


2 






1 


1 






















2 


2 
























1 


1 
























699 




















Total 


99 




119 




219 




91 







Pontiac 


Saginaw 






Previous employment 


Pontiac 


G. M. Truck 


Steering gear 






Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Num- 
ber 


Per- 
cent 


Horrp city 


15 


34 


32 
20 
32 


36 
23 
36 


158 

18 

216 


39 
4 
54 


} 1, 222 
414 

3 

10 
6 
2 
1 

12 
3 
2 

13 
1 
1 
4 

13 
2 
2 
2 
5 
1 

12 
1 
8 
2 
2 

12 
1 
3 
] 
1 


69 


Detroit - 




25 


52 


24 






Arkansas 






1 


1 


1 




1 










Florida 










1 




















1 


2 






2 




1 
















1 


1 








Kentucky 


1 


2 


1 




1 












M assachusetts 






















1 
1 


1 
1 


















1 


Nebraska 






2 


















New Jersey 
































North Dakota 


1 


2 












Ohio 










1 












1 

1 






Pennsylvania 
























South Dakota 






























1 


















West Virginia 










1 


















Canada 


1 


2 
























Total 


44 




89 




402 




1,762 






. 



7340 



DETROIT HEARINGS 





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NATIONAL DEFENSE MIGRATION 7341 

General Motors Defense Activities 

August 20, 1941 

As outlined recently to stockholders, production of defense materials in General 
Motors plants is increasing steadily, in both volume and variety. At the same 
time additional obligations are being assumed on which the production stage 
will be reached as rapidly as essential new facilities can be completed. Orders 
received or under negotiation now total $1,200,000,000 as shown below. Par- 
ticularly significant are the greatly expanded activities in the important field of 
aircraft, toward which half of General Motors defense efforts are directed. Exten- 
sive efforts are also being devoted to production of many types of highly technical 
ordnance material. In all, more than 70 percent of the defense contracts and 
orders of General Motors call for products outside the organization's customary 
activities. 

AIRCRAFT engines, PROPELLERS, PARTS, AND EQUIPMENT — $626,500,000 

Airplane engines (I). — Continuous expansion has been necessary to keep pace 
with orders for Allison liquid-cooled aircraft engines, which were again increased 
recently for Army account. Military horsepower rating of the V-1710 Allison 
engine has been stepped up to 1,325 without increase in size. Castings from the 
new aluminum foundry at Anderson, Ind., and precision-built parts from Cadillac 
Motor Car and Delco-Remy divisions have helped to boost production schedules. 

Amount, $233,200,000. 

Airplane engines (11). — Following an assignment from the United States Army 
Air Corps, Chevrolet Motor Division is tooling plants at Tonawanda and Buffalo 
to produce 1,000 Pratt & Whitney air-cooled engines per month. Additional 
orders have made necessary an increase in the projected capacity of the Buick 
aircraft engine plant, now approaching completion near Chicago, from 500 to 1,000 
Pratt & Whitney engines per month. The Buick plant at Flint will produce 
parts for these engines. Upwards of 25,000 men will be employed in these 
activities. 

Amount, $218,400,000. 

Airplane propellers. — Production is under way on a pilot order for a new type 
hydraulic airplane propeller for the United States Army Air Corps in the newly 
completed Aeroproducts Division plant near Dayton. Additional tooling opera- 
tions and plant increases, including a propeller parts plant at Frigidaire, are hasten- 
ing the expansion needed to meet further orders under negotiation. 

Amount, $70,800,000. 

Bomber parts and subassemblies. — Fisher Body Division is now in production on 
parts and subassemblies for twin- engine North American bombers in the expanded 
bomber program. The Fisher Memphis plant is being revamped and tooled for 
this purpose, and facilities of other General Motors divisions also are being utilized. 
The bombers will be assembled by North American Aviation at their Kansas Cicy, 
Kans., plant. 

Amount (Fisher Body's assignment). $66,000,000. 

Aircraft equipment. — Several General Motors divisions share in assignments for 
the production of various types of specialized component parts for aircraft. 
Included are bearings, heat exchange units, special aircraft spark plugs, landing 
gears, electrical and instrument items. 

Amount, $38,100,000. 

GTJNS, SHELLS, AND RELATED ITEMS $204,900,000 

Machine guns. — Months ahead of schedule, machine gun production lines have 
been operating since April in the AC Spark Plug plant and the Saginaw Steer- 
ing Gear plant. Frigidaire at Dayton has been in production since June and 
Brown-Lipe-Chapin at Syracuse will be on a production basis in the near future. 
The assignment shared by these four divisions has been augmented by additional 
contracts in recent months. 

Amount, $83,700,000. 

Rapid-fire cannon. — Olds Motor Works Division and Pontiac Motor Division 
now are installing special machinery and tools in preparation for the production 
of two types of rapid-fire cannon on assignments from the Army and Navy. 

Amount, $58,000,000. 

Gun housings and gun controls. — Fisher Body Division is well ahead of schedule 
on a United States Navy order for gun housings. The Fisher plant engaged in 
this work has been awarded the Navy "E" for excellent performance and given 



7342 DETROIT HEARINGS 

permission to fly the Navy Ordnance Flag as a reward of merit. Production of 
gun controls at the Delco Appliance Division has been under way for some time. 

Amount, $26,000,000. 

Shells, cartridge cases, and fuzes. — Another "ahead of schedule" G. M. defense 
project is the shell-production assignment at the recently built and equipped 
General Motors Forge plant of the Olds Motor Works Division. This plant is 
now turning out thousands of shells daily. Cartridge cases at Guide Lamp Divi- 
sion and fuzes at Delco Products Division are in volume production. 

Amount, $37,200,000. 

DIESEL ENGINES $159,700,000 

Production of Diesel engines — principally propulsion and auxiliary units for 
naval use — at the Cleveland Eiesel E!ngine Division is proceeding at an accel- 
erated rate. Facilities have been enlarged and important additional obligations 
assumed in recent months. Detroit Diesel Engine Division is producing Diesel 
units for various defense purposes. 

TRUCKS AND TRANSPORT EQUIPMENT $82,300,000 

Additional orders have been assigned to Chevrolet Motor Division. Deliveries 
of trucks of various special military types to the Biitish and United States 
Governments continue at a rapid rate. 

MISCELLANEOUS $18,100,000 

Many G. M. divisions are in production or preparing to manufacture various 
other types of defense materials, such as electrical equipment, tank track sets, 
tank gun mounts, dies and machine tools for other suppliers, magnetos, motors, 
and many other items of a technical and confidential nature. 

CANADA $103,500,000 

Substantial deliveries continue to be made by General Motors Canadian plants 
of military trucks and transport equipment, as well as shell fuzes. At Walker- 
ville, Ontario, the Border Cities Industries, Ltd., plant is preparing special fa- 
cilities for the production of machine guns. All defense production in G. M 
Cairadian plants is for account of the Canadian and British Governments. 



Memorandum on Labor Policy 

General Motors Corporation, 

Aiigust 23, 1941. 
Subject: Labor pohcies to be followed in connection with reduced production in 

schedules resulting from Governn.ent regulations. 
To: All general managers. 

While the cut in General Motors' passenger-car business ordered by Office of 
Price Administration and Civilian Supply and Office of Production Managem.ent 
amounted to 54.5 percent for the n.odel year 1942 as compared to the n.odel year 
1941, due to the fact that the corporation was changing n.odels and had no sched- 
ule for August, and only a partial schedule for September, it will be possible to 
reemploy more em.ployees than would have otherwise been the case. Office of 
Price Administration and Civilian Supply has also ordered the Frigidaire produc- 
tion to be cut 50 percent from the 1941 rate ot product'on. 

Subject to our being able to obtain n.aterial, the following labor policies will 
continue in effect until it is necessary to n.odify them due to production schedules 
ordered by Office of Price Adirunistration and Civilian Supply and Office of Pro- 
duction Management: 



NATTONAI. DEFENSE MIGRATION 



7343 



1. No new employees are to be hired on defense or any other work in any plant 
city where Generaf Motors' employees with seniority who can do the work are 
laid off. Former General Motors' employees without seniority will also be given 
preference on work they can do in new defense activities, providing they make 
application for such work. 

2. No employees working on automobile parts or Frigidaire parts who do not 
have seniority will be called back unless the plant is working 40 hours a week. 
If any such employees are now working, they should be laid off immediately unless 
the plant will be required to work approximately 40 hours per week to meet the 
schedules. This is only a problem in parts plants where only a small part of the 
total production is for passenger-car parts. 

3. All employees with seniority on autom.obile production will be called back 
if the schedules make it possible to operate the plant on a 32-hour basis. If there 
is not enough work to employ all seniority employees on a 32-hour basis, some of 
them with the least seniority wiU not be recalled, in accordance with local seniority 
rules. 

In the body-assembly and car-assembly plants, all employees with seniority 
will be brought back and the plants operated on a 40-hour basis until the assembly 
production is balanced with the parts production. This is possible because these 
employees have been laid off since late in July and the corporation had no August 
production of passenger cars. A number of seniority employees on parts produc- 
tion have already been recalled. 

4. The above regulations do not apply to apprentices and others generally 
considered exempt from seniority rules. 

It is recognized that during this period of adjustment, and especially where 
the plant has defense production as well as passenger car, truck, and other busi- 
ness, some departments will work niore hours than others. It may be desirable 
and necessary to even work some overtime on defense production where tooling, 
machinery, or uneven flows of materials limit the number of people who can be 
emploved. 

5. While the situation is somewhat different in each plant, subject to conditions 
beyond the corporation's control, it should be possible to operate the plants 
through October on this basis. 

Very truly yours, 

C. E. Wilson, President. 

Hourly and salaried em-ployee turn-over in Michigan cities, IS-month period, Sep- 
teinher 1940 through August 1941 





Defense plants 


Civilian plants 


Total 




IN ew hires 


Separa- 
tions 


Transfers 
in 


New hires 


Separa- 
tions 


Transfers 
out 


1941 peak 
employ- 
ment 


Month 
of peak 


Bay City 






1 

1,893 

1 1, 126 

263 


333 
8,703 
7,828 

433 

83 

3,472 

2,624 

2,407 


176 

4,683 

2,249 

171 

25 

936 

1,581 

1,654 


1 

1,590 

1, 126 

262 


2,228 
44, 452 
47, 844 

3, 100 
350 
13, 150 
16, 064 
11,302 




Detroit 


4,515 
12,617 


1,312 
1205 


Do 


Flint . 


Do 


Grand Rapids 




Ionia 






May. 
June. 
April. 
June. 


Lansing 

Pontiac 

Saginaw 


1,098 

164 

1,598 


93 
40 
142 


309 
513 
120 


311 
516 
119 


Total 


9,992 


1,792 


4,225 


25,883 


11,475 


3,925 


138, 496 





1 338 of these persons hired or transferred in Michigan have been moved to Melrose Park. 



60396— 41— pt. 18 19 



7344 



DETROIT HEARINGS 



Forecast as of Aug. SI, 1941, employment dislocation from June SO, 1941, levels 
in General Motors product groups (hourly and salaried employees) 





Employ- 
ment, 
actual, 

June 30, 
1941 


Dislocation, i. e., reduction in employment 


Division group 


Actual, 

Aug. 31, 

1941 


1941 forecast 


1942 forecast 




Sept. 30 


Oct. 31 


Nov. 30 


Dec. 31 


Mar. 31 


June 30 


Car - --- --- 


113,000 
59, 000 
69, 000 
20, 000 
17, 000 
14, 000 


41,000 
23, 000 

4,000 

1,000 

(') 

(') 


11,000 
13,000 

2,000 

1,000 

(') 

(') 


6,000 
11,000 
2,000 
1,000 
(') 
(') 


10,000 
15,000 

4,000 

2,000 

(') 

(') 


23, 000 
21,000 

6,000 

1,000 

(•) 

« 


27, 000 
24, 000 
10, 000 

(') 

(1) 

(') 


28,000 

27, 000 

12,000 

(') 

(') 

(') 


Body 


Parts and accessories 
Household 

General engine 

Miscellaneous 


Total, United 
States 


292,000 


67,000 


25,000 


17, 000 


27,000 


47,000 


68,000 


64, 000 



1 No indicated dislocation. 

Note. — These are over-all estimates. In some cases the defense expansion is not in the same city as the 
civilian curtailment. These estimates also assume that all employees no longer needed on civilian produc- 
tion will be able and willing to take the available defense jobs. The United States totals include a se'ieduled 
expansion of total employment in the general engine group. All United States divisions, operating and 
nonoperating, are included. Yellow Truck is excluded. 

For purposes of this tabulation, defense employment was limited to specialized defense plants or depart- 
ments whose turn-over could be segregated with reasonable certainty. An important part of General Motors 
defen.se production is military motor vehicles whose components are largely produced in conjunction with 
related civilian items. Although it was possible to prorat.^ these defense workers on semicivilian type items, 
it proved impossible to allocate the turn-over on this basis. New hires exclude persons recalled from lay-ofl 
or returning from leave of absence. Separations are permanent separations only and exclude lay-ofls and 
leaves of absence. 

An attempt was also made to secure now hires classified by state of previous employment, but in every 
plant approached the record system made an analysis of this character extremely difficult if not impossible. 



Employment in Present and Planned Facilities of General Motors 



^ I on ia 
Grand Rapids r— 1 ^,^ i „ i „ 

^ '^ I Fisher I 265 I | 



Bay City • 

I Chevrole t | 1379 | 41 | 640| 12-42| 

Sag inaw 



I Fisher I 2406 | 180 | 180 | S-41 | 



Lansing 



Fisher 


1132 








Olds 


3998 


1281 


2105 11-41 




Grey Iron 


3783 


7 


62 


12-41 


Transmission 


815 





355 


12-42 


Malleable 


1269 


268 


395 


12-41 


Steering Gear 


1160 


1729 


2394 


12-41 



Flint • 



AC Spark 


6568 


3305 


3835 


12-41 


Buick 


7758 


44 


2023 


12-42 


Chevrolet 


8679 


221 


221 


11-41 


Fisher /I 


1871 










Fisher fZ 


495 










Fisher Stamp. 


1119 


8 


13 


11-41 



Pont iac9 




/ 


Fisher 


2962 19 


46 


12-41 


Pontiac 


6071 677 


3987 


9-42 



Civilian Defe 



Present Employment Forecast Peak Defens 



Enployment 



Excludes Non-manufacturing Plants 



Cadillac 


2432 


3169 


4150 


3-42 


Gear 5 Axle 


5817 


1722 


4380 


12-41 


Transmission 


1640 


23 


30 


10-41 


Diesel 


832 


645 


1368 


6-42 


Fisher xt 


4868 


1624 


3405 


9-42 


Temstedt 


8604 


247 


254 


9-41 



NATIONAL DEFENSE MIGRATION 7345 

General Motors critical material requirements, 1941 and 19^2 model passenger cars 



Material 


Pounds per average 
car 


Design 
saving 
(percent) 


Pounds 

saved, 

including 




1941 


1942 


volume 
reduction 




7.6 

3.6 

.047 

62.8 

4.5 

51.9 

32.5 

2.7 

.0075 


1.8 
1.7 

.005 
18.9 
4.6 
55.1 
34.4 
2.8 
.0074 


76 
53 
89 
64 
-2 
-6 
-6 
-4 
1 


14, 148, 000 


Nickel -- 


5,899,000 




92, 300 


Zinc - 


92, 027, 000 




4, 957, 000 




55,603,000 




34, 916, 000 




2, 955, 000 




9,000 







1941 production volume 

1842 production allotment (tentative). 



Cars 

2, 082, 422 
950, 956 



(The following material was received subsequent to the hearing, 
and was made a part of the record in accordance with instructions 
from the chairman:) 

Exhibit A.^ — Interpretation op Policies Enunciated by Office of Pro- 
duction Management as They Affect General Motors Corporation 

General Motors Corporation, 

Detroit, Mich., October 20, 19^1. 
Hon. John H. Tolan, 

Chairman, House Committee Investigating National Defense Migration, 

Congress of the United States, Washington, D. C. 
Dear Mr. Tolan: As requested in your letter of October 17, I am enclosing 
herewith a copy of the agreed-upon interpretations of the policies enunciated by 
the Office of Production Management dated September 17, 1941, as they affect 
the plants of the General Motors Corporation. I am also enclosing six copies of 
A Message to Our Employees on the Employment and Defense Problem. 

Copies of the enclosed message have been supplied to employees of the Corpo- 
ration who are represented by the United Automobile Workers, Congress of Indus- 
trial Organizations. Copies have also been made available to all other employees. 
If there is any additional information I can supply you, I would be very glad 
to do so. 

Very truly yours, 

(Signed) C. E. Wilson, President. 

[Enclosure] 

The following is an agreed upon interpretation of the policies enunciated by the 
Office of Production Management, September 17, 1941, as they affect the plants 
of General Motors Corporation: 

provision no. 1 

Where a man working on nondefense production is laid off and obtains defense 
employment with another company, and that fact is certified to his former em- 
ployer, he will not have to report back for nondefense production work in order 
to protect his seniority so long as he retains the defense employment to which he 
was certified. If he shifts from one defense employment to another, there must 
be a recertification as to his new defense employment. Employers concerned 
with the application of this policy will work out arrangements which will result 
in the maximum possible acceleration of the defense program. 

provision no. 3 

Transfer of employees from nondefense to defense work in each local bargaining 
unit shall be in line with agreements regarding the transfer of employees. Em- 
ployees fully qualified for skilled and semiskilled jobs on the basis of past experi- 
ence and training shall be transferred in line with their seniority. 



7346 DETROIT HEARINGS 

If no such employees or an insufficient number of such employees who have 
made application are available, management will notify the shop committee and 
new, fully qualified applicants may be hired. 

If no such fully qualified applicants are available or it is necessary or desirable 
to train men for the work, employees with the greatest seniority working in the 
plant, who have applied and who can qualify within the period normally given 
to new employees shall be given the opportunity to qualify before new employees 
are hired to be trained for the job. 

PROVISION NO. 3 

When hiring new employees for defense work, qualified applicants out of work 
on account of authorized Government curtailment of nondefense production, or 
employees working on nondefense production in local industry where they can 
be spared or loaned, and where curtailment in their industry is authorized for the 
near future, will be given preference in such employment based upon length of 
experience in the industry or occupation. 

Such employees who are working or who have worked in local industries will 
be given preference over employees from other localities who have also been laid 
off because of curtailment. 

Employees working in plants on nondefense work where employment is decreas- 
ing who can be spared or loaned; who elect to accept such defense employment; 
and who are found acceptable and so certified by the prospective employer will 
be released with full protection of their seniority rights. 

PROVISION NO. 4 

Skilled tradesm.en, partially employed, or employed at occupations other than 
their trade or its equivalent in defense usefulness, will be released upon their 
request, with protection of their seniority rights, for full time defense work (40 
hours per week) at their trade. In instances in which a collective agreement 
pro -^ ides for a reduction of hours below the 40-hour basis, and employees collec- 
tively elect such reduction, the schedule of hours so reduced shall be regarded 
as fuU-tinie employment for the purpose of this provision. The prospective 
employer must certify to the present employer that he has offered the employee 
full-time defense work (40 hours per week) at his trade, before the request is 
granted. 

PROVISION NO. 5 

The above provisions shall become operative October 2, 1941 and shall not be 
retroactive, except that those provisions dealing with the protection of the 
employee's previously established seniority status shall be retroactive to Sep- 
tember 17, 1941. 

PROVISION NO. 6 GENERAL 

(a) Recall of employees. — An employee loaned or laid off, whether unemployed 
or currently employed on defense or non-defense work, must report back for 
defense employment to the company with which he holds his original seniority 
for work in the same community, if and when called, on notice of at least one 
calendar week. Recall of employees to defense work presupposes, the manage- 
ment will endeavor to provide full time employment, contingent upon the 
availability of the essential tools, material, and facilities. Skilled tradesmen will 
be subject to recall only for full-time defense employment at their trades or the 
equivalent. 

(6) Defense training. — For the purpose of these policies, defense training is to 
be considered defense employment, provided there is an understanding between 
the en .ployer and the employee that the employee is being trained for a specific 
pay-roll job. 

PROVISION NO. 7 

Any claim of discrimination by an individual employee arising out of these 
provisions may be reviewed by the Shop Committee with the local Plant Manage- 
ment but shall not be subject to further appeal. The Shop Committee is given 
the right to appeal any charge of general discrimination to the Corporation 
through the Defense Employment Division of the International Union, United 



NATIONAL DEFENSE MIGRATION 7347 

Automobile Workers-Congress of Industrial Organizations. Such charges must 
be supported by written evidence at the time the appeal is made. 

C. E. Wilson, 
b. d. kunkle, 
Harry B. Coon, 
Geo. F. Addes, 
Walter P. Retjther, 
Richard E. Reisinger. 
October 2, 1941. 

Exhibit B. — A Resolution Offering Automotive Industry Facilities for 
Mass Production of Standardized Airplane Body Parts 

adopted at a meeting of automobile and truck manufacturers in new YORK 

CITY, OCTOBER 15, 1940 

The makers of motor vehicles have made it their policy to render their produc- 
tive abilities available to the national-defense program to the extent that these 
may be utilized, and have already individually undertaken extensive manufac- 
turing programs for defense. 

The manufacturers of motor vehicles now are informed that the vastly expanded 
airplane production industry is or shortly will be overtaxed by the load imposed 
upon it by the current aviation procurement program. 

They further understand that a program of standardization on certain highly 
important defensive military planes has been developed upon existing designs, 
making it possible now for automotive industry mass production methods to be 
brought into play. 

Automobile and truck producers, as well as the producers of tools and dies and 
bodies for the automotive industry, have certain facilities that may be adaptable 
to producing airplane body parts in quantity for assembly by the aviation industry. 

On the basis of these facts, and in the desire to forward the national-defense 
program by aid to the responsible governmental agencies and to the aviation in- 
dustry, individual manufacturers representing practically all of the production of 
automobiles and trucks, present at a meeting today, hereby resolve: 

1. That in this period the manufacturers of motor vehicles, the tool and die 
makers and automotive body producers should subordinate work on automotive 
model changes to the necessities of the defense program and specifically to aviation 
procurement. 

2. That the president of the Automobile Manufacturers Association appoint 
forthwith a committee to cooperate with all those in the automotive industry, 
the aviation industry, the tool and die makers and automotive body shops in 
determining and listing all available facilities adaptable to airplane part 
production. 

3. That the committee cooperate with the National Advisory Defense Com- 
mission, the aviation industry and the automotive industry to develop and make 
effective a plan for the production of the desired tools, jigs, dies, and fixtures and 
the production of the airplane parts. 

4. That the individual manufacturers attending the meeting hereby do under- 
take to subordinate work on automotive model changes to the necessities of the 
defense program and specifically to aviation procurement, and to cooperate to the 
fullest extent toward the fulfillment of this purpose. 

5. It is further resolved that this action be immediately communicated to the 
National Defense Commission. 

The companies subscribing to the above resolution are: 

The Autocar Co., Brockway Motor Truck Co., Chrysler Corporation, The 
Corbitt Co., The Crosley Corporation, Diamond T Motor Car Co., Federal Motor 
Truck Co., Ford Motor Co., General Motors Corporation, Graham-Paige Motors 
Corporation, Hudson Motor Car Co., Hupp Motor Car Corporation, Inter- 
national Harvester Co., Mack Brothers Motor Car Co., Nash-Kelvinator Corpo- 
ration, Packard Motor Car Co., Reo Motors, Inc., Sterling Motor Truck Co., 
The Studebaker Corporation, Walter Motor Truck Co., The White Motor Co., 
Willys-Overland Motors, Inc., and Yellow Truck and Coach Manufacturing Co. 



7348 DETROIT HEARINGS 

Exhibit C. — Proportion of Unemployed Men in Chicago, Detroit, and Flint 
Percent of total male labor force as reported in the census of 1940 

On emergencv work (W. P. A., etc.): 

Chicago! 4.2 

Detroit 4. 1 

Flint 2.8 

Seeking work: 

Chicago 11- 5 

Detroit 10- 2 

Flint 8- 2 

Receiving unemployment compensation: ' 

Chicago 1- 9 

Detroit 1-1 

Flint • 6 

» Refers to iren and women together because published data do not distinguish. Computed by dividing 
total "corrpensable claims" (weeks for which total or partial compensation was paid) by 4, and then stating 
BS a percent of "labor force" reported to Census. Compensable claims are as of November 1940, from the 
Michigan and Illinois Unemployment Commissions. All other data are from the census of 1940. 



Exhibit D. — Condensed List of 83 Defense Items Manufactured by 
General Motors Corporation 

(Most of the items shown here subdivide themselves into many similar items for 

various applications) 



ammunition 

20 mm. projectiles. 

37 mm. projectiles. 

75 mm. shells. 

105 mm. shells. 

37 mm. cartridge cases. 

90 mm. cartridge cases. 

105 mm. cartridge cases. 

3" cartridge cases. 

Fuzes. 

Boosters. 

Primers. 

aircraft 

Allison engines. 

Pratt & Whitney engines. 

Bomber subassembhes. 

Propeller assemblies. 

Landing gears for bombers. 

Radiators. 

Oil coolers. 

Generators and regulators. 

Spark plugs. 

Ignition cable. 

Magnetos. 

Autosyn motors. 

Fuel pump motors. 

Aneroid valves. 

Hydraulic control valves. 

Gun-firing solenoids. 

Aluminum castings. 

Aluminum die castings. 

Aluminum forgings. 

Magnesium castings. 

Engine bearings. 



GUNS, MOUNTS, AND CONTROLS 

Navy gun housings. 
.30 caliber machine gun. 
.50 caliber machine gun. 
20 mm. machine gun. 
Gun sights. 

Fire-control equipment (various types). 
Electric motors for fire-control equip- 
ment. 
Tank gun mounts. 

MOBILE UNITS AND PARTS 

4x4 trucks. 

4x2 trucks. 

6x6 transfer cases. 

6x6 axle sets. 

Heavy duty gear sets. 

Bomb service trucks. 

Electrical equipment. 

Radiators (trucks and tanks). 

Oil coolers (trucks and tanks). 

Thermostats. 

Black-out lamps. 

Tank tracks. 

Tank fenders. 

Field assembly plants. 

Reflectors. 

DIESEL ENGINES, ARMY AND NAVY 

Tank engines. 
Submarine engine sets. 
Destroyer engine sets. 
Minesweeper engine sets. 
Escort vessel engine sets. 



NATIOaS'AL, DEFENSE MIGRATION 



7349 



Subtender engine sets. 
Fleet tug engine sets. 
Plane tender engine sets. 
Ship service engine sets. 
Generator engine sets. 
Miscellaneous Navy engine sets. 
Upright Diesels for Navy. 



MISCELLANEOUS 



Machine tools. 
Radio receivers. 
Forgings. 



Castings. 

Ball and roller bearings. 

Batteries. 

Lighting plants. 

Blowers. 

Refrigeration units. 

Navy warning signals. 

Development work covering wide range 

of defense material. 
Marine water coolers. 
Marine oil coolers. 

Submarine identification signal parts. 
Generator sets for special purposes. 



Exhibit E. — Defense Deliveries by General Motors Corporation * 

Before Oct. 1, 1940 $25,900,000 

Fourth quarter, 1940 30, 300, 000 

First quarter, 1941 46, 900, 000 

Second quarter, 1941 62, 100, 000 

Third quarter, 1941 2 107, 800, 000 

' This exhibit was submitted in form of a chart, leproduction of which was not feasible. The information 
was therefore tabulated as above. Figures given are for the United States only. 
2 Estimated. 



Exhibit F. — General Motors Production and Defense Contracts in 
Relation to All United States Industry and All Defense Contracts 

General Motors production relative to all United States industry, 1 936-40, at retail 

General Motors proportion : Percent 

All durable goods manufacture ' 8 

All durable metal products ^ 13 

1 Fiom Federal Reserve studies of George Terborgh. 

2 Fstin^ated as a percent of each classification, e. g., consumers housing, 25 percent; mining and manufac- 
turing, 90 percent. 

Value of General Motors defense contracts as percent of total in United States ' 



Dbte 


All defense. 

excluding 

pay and 

subsistence 


Defense 
obligations 

in metal 
products * 


June 30, 19413 1 


Percent 

4.1 
4.0 


Percent 

5.0 


Aug. 31, 1941 < 


(') 







' General Motors defense includes contracts, orders, negotiations, and estimates of future defense business 
direct with governments and as subcontractor. 

2 United States defense obligations includes orders in negotiation. 

3 From Business Wecl£, Sept. 27, 1941. 

* Based on testimony of William Knudsen before a congressional committee. 
» Not available. 



7350 DETROIT HEARINGS 

Exhibit G. — Value of supply contracts per dollar's worth of Government-financed 

plant 

[In millions of dollars] 



Total supply and facility contracts, excluding pay and subsistence — 

Government funds for new productive facilities -.- 

Proportion for productive facilities --- -.percent 



All defense 


All General 


contracts 


Motors 


over 


defense 


$50,000, 


contracts, 


Aug. 31 1 


Sept. 30 a 


19,962 


1,213 


3,636 


121 


18.2 


10.0 



1 The analysis of all United States contracts shown above was prepared by the Office of Production Man- 
agement Research and Planning Division and does not agree with most published totals because it (1) refers 
to reported signed contracts as distinct from letters of intent and other firm commitments, (2) excludes pay 
and subsistence, (3) excludes contracts for less than $50,000. 

' General Motors contracts shown above include letters of intent and other firm commitments directly 
with all governments. 

STATEMENT BY L. CLAYTON HILL, GENERAL MANAGER, 
MURRAY CORPORATION OF AMERICA 

Summary 



RESIDENTIAL PERIOD IN MICHIGAN, INDICATED IN APPLICATIONS FOR EMPLOYMENT 
IN MURRAY CORPORATION OF AMERICA 



Less than 6 months. 

Less than 1 year 

From 1 to 2 years.. 
From 2 to 3 years.. 



72 
47 
72 
45 



From 3 to 4 years 68 

Over 4 years 1, 196 



Total 1,500 



HOME STATE, APPLICATIONS FOR EMPLOYMENT, MURRAY CORPORATION OF AMERICA 



Alabama 4 

Arkansas 10 

California 1 

Colorado 1 

Connecticut 3 

Florida 1 

Illinois 25 

Indiana 17 

Iowa 6 

Kansas 7 

Kentucky .44 

Louisiana 1 

Maryland 2 

Massachusetts 1 

Michigan 1, 196 

Minnesota 16 

District of Columbia 1 

Province of Ontario 3 

Mississippi 2 



Missouri 

Nebraska 

New Jersey 

New Mexico 

New York 

North Carolina. 
North Dakota.. 

Ohio 

Oklahoma 

Pennsylvania.. 
South Dakota.. 

Tennessee 

Texas 

Vermont 

West Virginia. _ 
Wisconsin 



12 
1 
2 
1 
8 
2 
1 

35 
3 

38 
1 

34 
3 
1 

10 
7 



Total 1,500 



APPLICANTS FOR EMPLOYMENT OCCUPATIONS, MURRAY CORPORATION OF AMERICA 



Agriculturists 73 

Assemblers 158 

Clerical 293 

Engineering 119 

Inspectors 57 

Laborers 1, 045 

Maintenance 72 

Machinist — Tool 17 



Machinists — Production. 

Painters 

Tool and die makers 

Trimmers 

Supervisors 

Welders 



112 
30 
47 
25 
23 

113 



Total 2,184 



NATIOjSTAIi DEFENSE MIGRATION 7351 

Employment of Murray Corporation of America, Sept. 1, 1940, to Aug. 31, 1941 



Plant 


Sept. 
1940 


Oct. 
1940 


Nov. 
1940 


Dec. 
1940 


Jan. 
1941 


Feb. 
1941 


Mar. 
1941 


Apr. 
1941 


May 
1941 


June 
1941 


July 
1941 


Aug. 
1941 




2,100 


2,745 


2,862 


2,858 


2,571 


2,544 


2,591 


2,560 
4 


2,715 

7 


2,350 
14 


2,061 
18 


1, 9R2 




24 




















Total 


2,100 




2,745 


2,862 


2,858 


2,571 
112 


2.544 
247 


2,591 
342 


2,566 
431 


2,722 
527 


2.364 
639 


2.079 
891 


1,987 


2 Defense 


1,185 


5 Civilian 


400 


370 
20 


318 
35 


285 
60 


286 
71 


228 
97 


214 
136 


160 
160 


180 
270 


246 
573 


136 
761 


102 




927 








Total 


400 
649 


390 
600 


353 
600 


335 
550 


357 
550 


325 

575 


350 
543 


320 

535 


450 
522 


819 
560 


897 
424 


1,029 


6 Civilian 


410 




588 
453 


651 
576 


692 
705 


512 
705 


516 
773 


520 
813 


528 
825 


494 
804 


498 
846 


609 
864 


468 
866 


436 


Defense 


808 


Total - 


1,041 

1,270 

360 


1.227 

1,405 

390 


1,307 

1,372 

400 


1,217 

1,294 

398 


1,289 

1,277 

421 


1,333 

1,274 

429 


1,353 

1,239 

430 


1,298 

1,224 

409 


1,344 

1,236 

399 


1.373 

1.220 

393 


1,334 

1,160 

114 


1,244 


10 Civilian 


1.147 


11 Civilian.-- 


240 




5,367 
453 


6,161 
596 


6,144 
740 


5,897 
755 


5,621 
956 


5,570 
1.157 


5.545 
1.303 


6.382 
1,400 


5, 650 
1,660 


5,278 
2,090 


4,363 
2, 536 


4,297 


Defense 


2,945 






Total - 


5,820 


6,757 


6,884 


6,652 


6,577 


6,727 


6,848 


6,782 


7,200 


7,368 


6,899 


7,242 







STATEMENT BY C. E. WEISS, PACKARD MOTOR CAR CO. 

September 20, 1941. 

Employment opportunities in the automobile industry have always been 
attractive to applicants for employment from outside of metropolitan Detroit 
and Michigan. Even in the depths of the last depression tliere were people who 
applied for work at our plant from up-State and also from localities far removed 
from this area. Due to the publicity connected with the allotment of defense 
contracts, applications naturally increased. We have discouraged out-of-town 
applicants because of a policy closely followed for years, to employ people from 
metropolitan Detroit before taking those from out of town. There are variations, 
of course, to this policy at certain times because of heavy requirements for certain 
skills which may not be available on the Detroit labor market. 

Our employment records do not indicate the geographic origin of our employees. 
We record information regarding their former employers, but this may have no 
connection with their original residence. 

In order to provide you with some facts regarding this situation we have ob- 
tained from all applicants during the period of September 8 to September 19, 
inclusive, information regarding their original residence with the following results: 



Metropolitan De- 
troit 10,676 



Alabama 

Arkansas 

Colorado 

Connecticut - 

Delaware 

Florida 

Georgia 

Illinois 

Indiana 

Iowa 

Kansas 

Kentucky... 



91 

67 

1 

5 

2 

17 

194 

92 

90 

18 

5 

283 



Geographic origin 

Louisiana 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Montana 

Nebraska 

New Hampshire. 

New Jersey 

New York 

North Carolina. . 
North Dakota 



45 

2 

5 

403 

98 

45 

52 

1 

2 

1 

11 

4 

14 

7 



Ohio 

Oklahoma 

Pennsylvania 

South Carolina.. 
South Dakota. _ 

Tennessee 

Texas 

Virginia 

West Virginia. _. 
Wisconsin 



121 

22 

90 

35 

1 

235 

5 

7 

10 

66 



Total 12,823 



Note.— No record was made of those who repeated their calls at the employment department. It must 
be assumed that quite a number made return calls and increased the number listed as applicants. 



7352 



DETROIT HEARINGS 



For the 2 years previous to the acceptance of any defense contracts the Packard 
Motor Car Co. employed on automobile work an average of 10,390 employees. 
On April 12, 1939, we began the manufacturing of marine engines for the United 
States Navy. This project started with 125 people and now involves 929. These 
were practically all transferred from the car division and replaced with employees 
who had been laid off. 

In September 1940 the company accepted contracts from the British Purchaiing 
Commission and the United States Air Corps for 9,000 Rolls-Royce Merlin air- 
craft engines. On December 31, 1940, there were 1,237 employees engaged in the 
preparatory work necessary for the production of aircraft engines. 

The tabulation given below indicates the employment on defense and non- 
defense work from December 31, 1940, to date and a projection of what we expect 
it to be from this date to the end of June 1942 by 3-month periods. 



Date 



Total 



Marine 
engines 



Aircraft 
engines 



Auto- 
mobiles 



Dec. 31, 1940_ 
Mar. 31, 1941 
June 30, 1941. 
Sept. 20, 1941 
Dec. 31, 1941. 
Mar. 31, 1942 
June 30, 1942. 
Peak defense 



12,018 
10, 892 
11,655 
14, 040 
17, 300 
18, 180 
20, 938 
Unknown 



646 

923 

922 

925 

1,000 

1,200 

1,300 

1,300 



1,237 
2,362 
3,725 
5,796 
9,300 
11,980 
14, 638 
17, 600 



10, 135 
7,607 
7,010 
7,319 
7,300 
5,000 
5,000 
Unknown 



We have had considerable experience with the transferring of employees from 
automobile work to defense work. Our experience has indicated that in the skilled 
groups, or journeymen, there is practically no problem involved. In the trans- 
ferring of semiskilled employees even on similar types of work some retraining is 
necessary. There is a considerable variation, however, in the amount of time 
required. This variation in time ranges from 3 days or a week to as high as 3 or 
4 months. 

In addition to becoming familiar with the operation there is a considerable loss 
in efficiency until the operator has become proficient in the cycle of work required 
to complete his operation and can perform in accordance with accepted standards. 

The above statement is based on the transfer from automobile work to engine 
work only, as we have had no experience with other types of defense production. 



STATEMENT BY ROBERT WALDRON, PERSONNEL DIRECTOR, 
HUDSON MOTOR CAR CO. 

September 19, 1941. 

Employment by month for the past year, segregated as to whether on defense 
or nondefense production: 





Nondefense 


Defense 




Nondefense 


Defense 


August 1940 


10, 831 
11,2.38 
11,137 
7,216 
5,057 
5,158 
6,915 



8 
41 
33 
122 
243 
463 


March 1941 


7,138 
7,269 
7,959 
7,877 
4,363 
10, 233 
6,749 


585 


September 1940 


April 1941 


591 


October 1940 


May 1941 


548 




Juno 1941 - 


478 




July 1941 


553 




August 1941 


880 


February 1941 . 


September 1941 


1,722 









NATIOJSTAL DEFENSE MIGRATION 



7353 



Number of hires and discharges for defense and nondefense production, and 
transfers from nondefense to defense, by month, for the past 12 months: 





Nondefense 


Defense 




Hires 


Pay-offs 


Hires 


Pay-ofls 


Transfers 


September 1940 


993 

487 

277 

236 

1,293 

565 

1,492 

1,270 

645 

637 

6,131 

3,258 

511 


801 

3,462 

3,114 

261 

159 

176 

280 

494 

587 

5,432 

369 

1,710 

2,591 


None 

None 

None 

None 

63 

109 

128 

125 

83 

91 

69 

109 

112 


None 

None 

None 

None 

18 

37 

53 

42 

56 

35 

72 

64 

24 


None 


October 1940 -- - --- 


None 




None 


December 1940 .. .- - ..- . - 


None 




2 


February 1941 


5 


March 1941 . - -.- 


14 


April 1941 - - - 


10 


May 1941 - - 


16 


June 1941 


19 


July 1941 


109 


August 1941 .- 


129 


September 1941 (first 2 weeks only) 


218 



Estimates of employment on defense and nondefense production by month for 
the forthcoming year: 



Oct. 31, 1941_. 
Nov. 30, 1941- 
Dec. 31, 1941.. 
Jan. 31, 19421. 
Feb. 28, 1942.. 
Mar. 31, 1942. 



Nondefense 



6,749 
6,749 
6,749 



Defense 



2,520 
2,975 
3,674 
3,904 
4,135 
4,735 



Apr. 30, 1942.- 
May 31, 1942. 
June 30, 1942. 
July 30, 1942.- 
Aug. 31, 1942- 
Sept. 30, 1942. 



Nondefense 



Defense 



5,335 
5,885 
6,435 
6,700 
6,967 
7,235 



I No estimates beyond this date are possible because of the fact that Office of Production Management 
production quotas are not now available. 

EFFECT OF CURTAILMENT IN PRODUCTION 

As may be noticed in the aforementioned figures, the principal effect of the 
curtailment on employment is sliown by the difference in our nondefense em- 
ployment prior to the curtailment as indicated in the August 1941 figure and the 
employment estimates on nondefense work for the remainder of the year 1941. 
Those employees displaced will be recalled as rapidly as defense production can 
absorb the qualified employees. This absorption is complicated by the fact that 
the type of defense work we are undertaking requires a higher proportion of 
skilled employees than normally are needed in automobile production with the 
result that many of those competent to perform automobile production work 
require additional training to qualify for defense production work. 

TRAINING PROGRAM 

Early last spring, Hudson Motor Car Co., in cooperation with the Office of 
Vocational Education for National Defense, placed more than 2,000 of its em- 
ployees in classes in public schools and in special classes organized in a new school 
established at the Hudson Motor Car Co. These classes have given training in 
machine-tool operation to Hudson employees in anticipation of their use at our 
new United States Naval Ordnance Plant. More than 400 of these trainees 
have been transferred to this plant, with more scheduled for possible transfer in 
the future. 

This training program was augmented, during the seasonal lay-off between 
models, by classes operated at the Hudson Motor Car Co., 24 hours per day, 
and in outside schools, 12 hours per day. In addition, Hudson classes again are 
operating on a 24-hour schedule for employees laid off as a result of automobile 
production curtailment. 



7354 DETROIT HEARINGS 

TRANSFER INTO DEFENSE WORK 

In a further effort to minimize the dislocation of employment the company 
and the local union have entered into an agreement providing for an orderly 
transfer of qualified employees to defense work on a seniority basis. A copy of 
this asireement is attached to the original copy of this report. It may be noted 
that this agreement was negotiated in July 1941. 

Geographical problems in transfers to defense work are not great because of 
the fact that our United States Naval Ordnance Plant is only 10 miles from our 
main plant, and all of our other defense activities are located in our present 
plants. 

The difference of skill required in cur nondefense and defense work, as indi- 
cated in our answer to paragraph 4, has presented a specific training problem 
which this company recognized and acted upon well in advance. 

Of course, these estimates are in light of present knowledge. 



Exhibit A. — Article 6, Paragraph (c) of Agreement Between Hudson 
Local No. 154 and Hudson Motor Car Co. 

"When new jobs or classifications are created or when vacancies occur, the 
employees with the greatest seniority shall be given preferential consideration for 
these jobs * * *" 

In order to provide a uniform understanding of the procedure to be followed in 
transferring hourly rate employees from regular production work to newly created 
defense jobs, and in order to assure that this article and paragraph of the agree- 
ment are adhered to, the following procedure will be followed: 

1. Record cf.rds for each employee on the roll now are being completed, con- 
taining, in addition to the employee's name and clock number, the following 
information: 

(n) All classification numbers on which the employee has worked in the employ 
of the Hudson Motor Car Co., as shown in the employee's employment record. 

(6) All classifications in which the employee has claimed experience, either at 
the Hudson Motor Car Co. or elsewhere, as given by the employee in filling out 
his "Experience record." 

(c) All classifications in which the employee has claimed experience elsewhere, 
while on leave of absence during the 1941 model, as given by the employee in 
answer to the questionnaire sent to all leave of absence employees. 

(d) The names of any vocational training courses in which the employee has 
enrolled. 

(e) The employee's seniority. 

2. These cards are to be arranged in order of plant wide seniority. In cases 
of employees who have split seniority, this seniority shall be totaled, in order to 
give these split seniority people full credit for their total service with the company. 

3. Immediately in advance of any transfers to new jobs or classifications, the 
employment office will review these cards in an effort to find the oldest seniority 
man capable of filling the new job, or of filling any vacancj^ in the mechanical or 
machining division which is caused by the transfer of others from that division 
to defense work. 

Selection of employees for "training on-the-job" will be on the basis of experience 
in related or similar operations, and on seniority. With the previous experience 
being equal, the employees with the greatest seniority will be first chosen. 

In the selection of employees to fill vacancies or for training on the job in skills 
represented in the present organization of the Hudson Motor Car Co., employees 
who would be next in line for breaking in on the job within their own seniority 
district will be offered such jobs or training. 

(a) Where an employee has previously performed the job at the Hudson 
Motor Car Co., he will be offered the job without further qualification. 

(b) Where the employee has not previously performed the job at the Hudson i 
Motor Car Co., but where he claims he has performed the job elsewhere, or has 
taken vocational training in that skill, he will be given a trial at that type of work 
under competent supervision in our regular school locations on the fourth floor 
of building 2S or elsewhere. If he shows that he is qualified to perform the job, he 
will be offered the job. If he fails to qualify for the specific job an effort will be 
made to see whether or not he can qualify at a later date by taking further training. 
Meanwhile, an effort will be made to determine his highest usable skill, and to 
transfer him to a job at that skill whenever his seniority entitles him to such a 
transfer. ■, 



NATI0;NAI. DEFENSE MIGRATION 7355 

A special committee of three members of the union, all of whom must have com- 
pleted an apprenticeship as toolmaker or machinist, will be appointed by the 
union to review the technical qualifications of employees who dispute the decision 
of the supervisor of this quaUfying station. The personnel division will meet with 
this committee weekly, if any such grievances have occurred during the preceding 
week, to expedite the handling of such grievances. 

In highly skilled occupations, in which no present employee of Hudson Motor 
Car Co. has had actual identical experience, or in which there are not sufficient 
employees fully qualified by experience to fill the vacancies, new employees may 
be hired to perform the job or assist in training other employees in these skills. 

4. As employees are offered jobs on defense work, in order of their seniority, 
each employee will have the following options: 

(a) Of taking the job offered, if qualified. 

(6) Of decUning the offer and remaining on his regular job until such time as 
further restriction of automobile production or some other prolonged and per- 
manent curtailment occuis. If this situation arises, employees having made this 
election will be entitled to transfer in line with their seniority to such defense 
work as they may be qualified for. 

Employees retained on automobile production for the purpose of training new^ 
employees or for performing any operation in the automobile shop will have the 
same rights as those outlined immediately above, either at such time when they 
can be released from the job on which they previously had been held or at any 
time when further restriction of automobile production or some other prolonged 
and permanent curtailment occurs. 

(c) Of remaining on his present job, with the understanding that he will wait 
until another specific opportunity presents itself to him for a job more to his per- 
sonal liking. (This would allow each employee to choose, for example, between 
the gun plant, plant A, or the piston and rocker arm job.) 

(d) In cases where the employee's present job would pay him more money than 
the job he would be offered, the employee, who in this case would be taking train- 
ing in a new skill, has the option of taking the new job at the current rate for that 
job, or of staying on his present job, and continuing his training in his new skill 
until such a time as it would appear to be to his best advantage to be transferred 
from his present job. If the employee takes this latter optic n, he will notify the 
employment office, in writing, when he decides to be transferred to his new skill, 
and, if he has continued his training in the meantime, he will be offered the next 
job which opens up in his new skill, to which his seniorit>' would entitle him. 

5. All of the above elections will be made in writing, signed by the employee, 
and kept on record in the employment office. 

6. At the conclusion of this defense work, the seniority lists of January 1, 1941, 
will be the controlling factor in returning defense employees to Hudson auto- 
mobile work, with it being the expressed intention to have each employee resume 
his regular position on January 1, 1941, seniority list at the conclusion of the de- 
fense program. As provided in the contract between the Hudson Motor Car 
Co. and the United Automobile Workers Local No. 154, 1 year will be added to 
the seniority of each man on that seniority list for each year he w^orks for any 
division of the Hudson Motor Car Co., whether on regular automobile w^ork, 
or in any of its defense divisions. This would not allow any employee to pass 
any other employee on that list, and would assure full protection of seniority 
rights to those who go on defense work, and those who stay on automobile pro- 
duction, alike. 

7. Wage rates at the Naval Ordnance Plant will be the same as rates paid for 
similar classifications at the Hudson Motor Car Co, 

In the case of employees who have taken training in any skill, who have not 
previously been employed in the classification to which they are to be assigned 
at the Naval Ordnance Plant, the following w^age procedure will be established: 

(a) On repetitive operations which are similar to production operations at 
Hudson Motor Car Co., the employees will be transferred at the qualifying rate 
for that classification unless employee's previous experience or qualification is 
justification for an exception. 

(6) On nonrepetitive operations similar to w^ork in the mechanical division the 
newly trained employee will start at a learner's classification and will start at the 
qualifying rate for the learner's classification in that particular skill. This learner's 
rate will start at 10 cents below the hiring rate for the B classification in that skill 
with the qualifying rate at 5 cents higher. 

8. Exceptions to this procedure will be allowed only in cases where conditions 
warrant such an exception. 



7356 DETROIT HEARINGS 

TESTIMONY OF AUTOMOTIVE INDUSTRY PANEL— Resumed 

The Chairman. Dr. Lamb has a few prehminary questions which he 
will ask you gentlemen. 

Dr. Lamb. I would like to start by asking some statistical questions. 
I suggest, for these first questions, that we go around the circle and 
ask each of you, as representatives of your individual companies, what 
your answers are for the record. 

We already have received statistical material from some of you, and 
incidentally, we want to thank you for the great effort that your staffs 
have made to get this information for us. But I think the press and 
the individual members of the committee will be interested to hear 
these figures given individually as we go around the circle. 

The Chairman. I want to say to you gentlemen, this is Congress- 
man Curtis from Nebraska on my extreme right; this is Congressman 
Arnold from Illinois, and this is Congressman Osmers from New 
Jersey. 

I am from California. You may proceed. Dr. Lamb. 

TESTIMONY OF ROBERT W. CONDER, DIRECTOR OF LABOR RE- 
LATIONS, CHRYSLER CORPORATION 

Dr. Lamb. Mr. Conder, when do you think the cut in automobile 
production will take place, and when will it have its greatest effect? 
Mr. Conder. In December. 
Dr. Lamb. This year? 
Mr. Conder. Yes, sir. 

TESTIMONY OF R. I. ROBERGE, OFFICE OF EDSEL FORD, FORD 

MOTOR CO. 

Dr. Lamb. Does that apply to you also, Mr. Roberge? 

Mr. Roberge. I would say the early part of next year — probably 
January or February. 

Mr. Conder. Do you mean at what time will we be at our lowest 
ebb in employment? 

Dr. Lamb. Yes. 

Mr. Conder. That is, before the defense work begins to take up the 
employees who are laid off? 

Dr. Lamb. That is right. 

Mr. Conder. In the latter part of December or the first of January. 

Dr. Lamb. And the same thing applies to you, Mr. Roberge? 

Mr. Roberge. I would say the first part of next year, January or 
February. 

TESTIMONY OF C. E. WILSON, PRESIDENT, GENERAL MOTORS 

CORPORATION 

Dr. Lamb. Mr. Wilson? 

Mr. Wilson. It is a little hard to say in our case, because our 
answer must depend partly on how much defense business we are going 
to have over a period. 



NATIONAL DEFENSE MIGRATION 7357 

Dr. Lamb. Can you give us an estimate on the basis of foreseeable 
reductions in employment today? 

Mr. Wilson. A fairly severe reduction will occur in January, or 
at the end of December, and perhaps from then on the defense business 
will pick up about as fast as the passenger-car reduction occurs, 
assuming that the present proposed schedule for the rest of the year 
holds, which, of course, we don't know, because we have only been 
given a schedule through December. 

Dr. Lamb. I understand we are all having to talk on the basis of 
the present outlook, until such time as new schedules are issued. 

Mr. Wilson. There will be a substantial reduction at the end of 
December, in our case, and then if the proposed schedule for January 
tlirough July is adhered to, there will be increasing reductions in 
automobile employment, but at the same time there will be some 
increasing employment in defense. Perhaps they will offset each 
other after the initial substantial reduction. 

TESTIMONY OF L. CLAYTON HILL, MURRAY CORPORATION OF 

AMERICA 

Dr. Lamb. Mr. Hill, we will get your reply to the first question a 
little later. When would you expect the pick-up in defense employ- 
ment to absorb the displaced workers? 

Mr. Hill. I would say our greatest reduction would occur in the 
latter part of December. 

TESTIMONY OF C. E. WEISS, PERSONNEL DIRECTOR, PACKARD 

MOTOR CAR CO. 

Dr. Lamb. And Mr. Weiss? 

Mr. Weiss. We do not anticipate any reduction, although if there 
is any, it would occur in the latter part of December. 
We expect the defense contracts to take up that slack. 

TESTIMONY OF ROBERT WALDRON, HUDSON MOTOR CAR CO. 

Dr. Lamb. Mr. Waldron? 

Mr. Waldron. I am making the same reservation Mr. Wilson 
made. We don't know what is in the offing beyond the first of the 
year. Our greatest reduction has already taken place. We have had 
a drastic cut already, on the first 4 months' production. 

Dr. Lamb. So you don't anticipate any further reduction? 

Mr. Waldron. We don't anticipate any, unless some unforeseen 
event might change the outlook further. 

EXPECTED PICK-UPS IN DEFENSE EMPLOYMENT 

Dr. Lamb. Now, I will go around with the second question, begin- 
ning with Mr. Conder. 

When do you expect that your pick-up in defense employment will 
absorb these automobile workers? 

Mr. CoNDER (Chrysler). On the basis of present defense contracts, 
we do not expect to be able to absorb the employees laid off because of 
the automobile curtailment. The situation will improve over what it 
will be at the end of December or the 1st of January, but we will not be 



7358 DETROIT HEARINGS 

able to absorbe all of them unless there is more defense business than 
we have now. 

Dr. Lamb. Mr. Roberge. 

Mr. Roberge (Ford). We hope to receive defense orders that will 
assist greatly in absorbing some of the employees laid off, but it is 
difficult to say just what they will amount to, because the orders are 
not firm at the present time. 

Dr. Lamb. Is that business still in process of negotiation with your 
company too, Mr. Wilson? 

Mr. Wilson (General Motors). I would like to point out that more 
than half of the reduction in employment in the automotive industry is 
going to be in General Motors alone, so that we have more than half of 
the problem. 

The present defense orders we have on hand, and the increased 
quantities of material we are organized to produce, will not begin to 
reemploy the people that we had employed last June. 

We have been actively working with all interested Government 
agencies to obtain more business, and have been since the beginning 
of the emergency a year ago in June, and we have projects in hand now 
and are submitting proposals on additional projects. But as the 
matter stands right now, we don't see the end on reemploying all the 
people who are goinq; to be laid off. 

Dr. Lamb. Mr. Hill. 

Mr. Hill (Murray Corporation). We should be able to absorb all our 
male employees by the early spring of next year. I expect we will be 
embarrassed because we have a considerable number of female 
employees who may not be adaptable to the aircraft work. We will 
use as many of them as we can, but we may have some difficulty 
absorbing them. 

From then on out, we may have to pick up some other employees 
outside our own organization. 

Dr. Lamb. Mr. Weiss. 

Mr. Weiss (Packard). We do not anticipate that there will be any 
lay-offs. In other words, our defense program will absorb practically 
all of our car people. 

Dr. Lamb. And Mr. Waldron. 

The Chairman. May I interrupt for a moment. Mr. Hill, what is 
the Murray Corporation of America? 

Mr. Hill. We manufacture a large number of metal assemblies for 
automobile bodies, chassis and frames for automobiles, and we have 
a substantial contract for airplane wings and airplane parts. In addi- 
tion, we manufacture cushion springs and wire products. That is 
where this large percentage of women is employed, and we anticipate 
a big reduction in that business. 

Mr. Waldron (Hudson). We anticipate by March 1 we will absorb 
all oin- male employees and perhaps some of the female. 

TESTIMONY OF C. C. CARLTON, MOTOR WHEEL CORPORATION, 
AND PRESIDENT, AUTOMOTIVE PARTS AND EQUIPMENT MAN- 
UFACTURERS ASSOCIATION, DETROIT, MICH. 

Mr. C^RLTON. I would like to answer that question. I understand 
this discussion is rather informal. 

Dr. Lamb. Certainly, we would like to have your answer. 

Mr. Carlton. Speaking for the Motor Wheel Corporation at 
Lansing, Mich., I would like to express a slightly different viewpoint. 



NATIONAL DEFENSE MIGRATION 7359 

Our greatest reduction in employment has already occurred. About 
25 percent of our 2,500 men are now laid off. We will have Govern- 
ment work that will pick up a small part of them between now and 
January, but eventually, despite anything that we may now have in 
the way of Government orders, about 25 percent of our people will be 
continuously unemployed.^ 

TRANSFER OF WORKERS TO DEFENSE PRODUCTION 

Mr. Curtis. Wliat is your policy with regard to transfer of workers 
from civilian production to defense work, and how is it working out? 

Mr. Carlton. In the beginnmg of the work on our first defense 
orders we could not transfer men because we were then running 100 
percent in the automotive industry; therefore, we were compelled to 
hire new men for defense orders. As the reduction in automobile- 
passenger-car business occurred, we could absorb our own men, our 
regular employees. However, the seniority situation handles that 
pretty well because our own people will all be eventually employed; 
that is, our older employees will all be employed on defense work as 
far as the defense work will go. 

Dr. Lamb. And Mr. Conder? 

Mr. CoNDER (Chrysler). The great majority of our employees on 
defense work now have been transferred from the automobile plants. 
We have endeavored to select them on the basis of qualification by 
their experience in the automobile plants to do the job in defense plants. 

Mr. Curtis. Have they been transferred with or without training 
under the defense program? 

Mr. CoNDER. So far we have been able to find employees who 
have had sufficient experience on similar types of work in the auto- 
mobile plants to place these men on the jobs in defense plants, and 
give them what training they needed there. 

Mr. Curtis. How many have you transferred? 

Mr. CoNDER. You are referring to both salary and hourly-rate 
employees? 

Mr. Curtis. Yes. 

Mr. CoNDER. Approximately 400. 

Mr. Curtis. Mr. Roberge, what is your answer to this question? 

Mr. RoBERGE (Ford). As rapidly as the defense work progi'esses in 
our organization, we transfer men from our automobile operations to 
defense operations, and they are given training, of course, before they 
proceed on that work. 

Mr. Curtis. How much training? 

Mr. Roberge. Sufficient to quahfy them for the job that they are 
taking over. 

Mr. Curtis. WTiat is the average length of the training? 

Mr. Roberge. I couldn't tell you. 

Mr. Curtis. What are the maximum and minimum? 

Mr. Roberge. I don't believe I could tell you that. It depends on 
the particular skill of the man and the job that he is going on. 

Mr. Curtis. How many have you transferred? 

I In a letter received subsequent to the hearing, Mr. Carlton supplied the committee with additional 
information on this point, as follows: "That statement was true to the best of my knowledge and belief the 
day I made it, but additional United States Government orders now on hand indicate that by the end of 
November and from there on to an indefinite period, we shall be able to employ all Motor ^^ heel labor. 
In other words, the serious reduction of employment due to the mandatory curtailment of passenger-car 
production will all be taken up approximately by the end of November by additional Government contracts 
which we have received." 

60396 — 41— pt. 18—20 



7360 DETROIT HEARINGS 

6,000 WORKERS TRANSFERRED 

Mr. RoBERGE. About 6,000. 

Mr. Curtis. Is the plan working out all right? 

Mr. RoBERGE. Yes. 

Mr. Curtis. Mr. Wilson? 

Mr. Wilson (General Motors). The way the corporation runs its 
plants, the various divisions have seniority set-ups by plants. Some 
plants also have seniority set-ups by occupational groups within 
plants. 

EMPLOYEES RETAIN SENIORITY RIGHTS 

When we started our first defense operations, some of the em- 
ployees were somewhat loathe to be transferred over to defense for 
fear the defense job might run out and then they would be out of 
their regular work; so we worked out a plan under which an em- 
ployee transferred to a defense department or a defense plant keeps 
his seniority in the old plant and acquires seniority in the new plant 
from the time he starts his new work. 

We did that a great many months ago, during the period from 
June 30, 1940, to June 30, 1941. We employed about 80,000 addi- 
tional people in our various plants over the country, so that it has 
been only recently that we have had much of a problem with any 
laid-off employees or any problem of transfer. We have had no 
trouble finding suitable employees for the work. We have picked 
out the people we thought could do the work best on defense projects, 
and transferred them, or hired new employees. 

In two places we did get cooperation from the local schools in 
training, at our Allison engine plant in Indianapolis and in connec- 
tion with our machine-gun plant in Flint. In both of those places 
we specially trained new employees for the work. 

EMPLOYMENT POLICY OF GENERAL MOTORS 

Following the announcement of the large cut in business, we im- 
mediately put into effect an order that — 

no new employees are to be hired on defense or any other work in any plant in 
any city where General Motors employees with seniority who can do the work 
are laid off. 

Former General Motors employees without seniority will also bt given preference 
on work they can do in new defense activities, provided they make application for 
such work. 

That is the present General Motors policy. 

Mr. Curtis. Would you say then, that by and large your transfer 
system is working out very well? 

Mr. Wilson. I know of no problems in connection with it now. 

We also have an agreement in our union contracts covering the 
transfer of employees within plants, so far as our regular work is 



NATIOaNAL DEFENSE MIGRATION 7361 

concerned, and there is no reason why that same clause doesn't amply 
take care of the transfer of employees from nondefense to defense 
work. 

Mr. Curtis. Could you state how many have been transferred? 

Mr. Wilson. I don't know. 

Mr. Curtis. Mr. Hill, what is your policy with respect to transfer 
of workers from civilian production to defense production? 

NEW WORKERS HIRED FOR DEFENSE PRODUCTION 

Mr. Hill (Murray Corporation). Our defense contracts started 
while our automobile work was at a peak, so we were unable to transfer 
people. We went outside and started to hire new people. 

Some of these were very highly skilled people, such as draftsmen, 
engineers, laboratory and material-testing men, and aircraft engineers. 
However, since the cut has been made in automotive production, we 
have adopted a policy of not hiring any outside workers at all unless 
we cannot find a properly qualified man in our own organization. 

Recently we have attempted to follow a new plan. When men are 
laid off in automotive production, we lay them off temporarily, and 
then, as rapidly as we can we transfer our oldest men from our civilian 
work into defense work, we hire back our employees with less seniority 
who have been laid off. That is the plan we are attempting to follow 
at the present time. 

When we decide to transfer a man from civilian work to defense 
work, we give him the opportunity to decline. If he declines, he does 
not get another opportunit}^ until the next time we call up more men, 
and when he goes to defense work he cannot "bump out," as the union 
says, any men of lesser seniority who are in the defense work. 

Mr. Curtis. Does he retain his seniority in his civil work? 

Mr. Hill. Yes, sir; and he builds up a seniority in the defense work. 

Mr. Curtis. Mr. Weiss. 

EMPLOYMENT POLICY OF PACKARD MOTORS 

Mr. Weiss (Packard). In the first defense project that we started, 
which is now in operation, almost all the workers were taken from the 
car shops. There was hardly any hiring from the outside at all. On 
the next project, though, which is much larger, for the preparatory 
work we had to build up our tool rooms and that sort of thing, and we 
did employ quite a number of draftsmen and tool designers from the 
outside, in addition to those we had. But on production jobs we are 
transferring men from the car shops to the defense jobs every day, 
and have been for the last several months. 

Mr. Curtis. What defense work is the Packard Motor Co. doing? 

Mr. Weiss. Building marine motors for the mosquito fleet and 
Rolls-Royce aircraft engines for both England and the Air Corps. 

Mr. Curtis. Have the skilled employees that you transferred had 
to have some additional training? 

Mr. Weiss. Not the skilled men, so much, but we have had to give 
some training to the men on the production jobs. 

Mr. Curtis. The lesser skilled? 



7362 DETROIT HEARINGS 

Mr. Weiss. They are what we call semiskilled people, and even in 
some of those classifications we don't have enough in the car division 
trained to do the work, and we have to build up training programs from 
people from other classifications in that particular work in order to 
get a sufficient number. 

Mr. Curtis. Mr. Waldron. 

HUDSON MOTOR'S TRAINING PROGRAM 

Mr. Waldron (Hudson). We started last February on quite an 
extensive training program, and we utilized about 20 schools in town, 
plus 1 of our own, in training our present or our former personnel, 
some of whom have been transferred. Some of our automobile 
workers have been transferred into the ordnance plant as the machines 
were delivered and installed, and that has gone along very satis- 
factorily. 

They are transferred according to the plan I submitted with my 
brief to the committee.^ 

Mr. Curtis. What is the Hudson Motor Car Co. making? 

Mr. Waldron. We are making 20-milhmeterguns and alarge number 
of ordnance parts in a newly erected plant on the outskirts of town. 
Also a section of the Martin bomber, and pistons and rocker-arms for 
Wright Aeronautical Co., and ailerons for Repubhc Aircraft Cor- 
poration. 

Mr. Arnold. Mr. Carlton, I will direct this question to you, and 
it may be that you will want to conduct a panel discussion on it. If 
you do, please feel free to do so, because Mr. Thomas didn't hold back 
this morning. He spoke what was in his mind. 

In his statement, Mr. Thomas, of the U. A. W., testified that the 
major responsibility for the prospective reduction in employment in 
the automobile business rests with the industries themselves. 

The union's contention was, apparently, that the industry preferred 
to extend a prosperous automobile season rather than convert its 
facilities to defense production. In order that the record may be 
complete, I should like to have you gentlemen indicate what proportion 
of your normal civilian facilities has been converted to defense pro- 
duction. 

percentages of employment in defense work 

Mr. Carlton. That question, of course, will necessarily have to be 
answered by each individual company; but for my company (Motor 
Wlieel) I will say that about 25 percent of our people are now employed 
on defense work, or will be by the 1st of October. 

I am at a loss to understand why the first statement was made. 
All the companies with which I am familiar first offered their services 
in every possible way to every branch of the defense effort. 

If you didn't get business that way, you then went at it as any 
salesman would — sell the Government your facihties. I know, as 
far as our company is concerned, we have done everything within our 
power to get additional business. We are still working at it, and 
hoping for additional business to keep our total number of employees 
working and our total sales volume up. 

1 See p. 7354. 



NATIONAL DEFENSE MIGRATION 7363 

The parts industry initiates practically no business, as far as the 
automotive industry is concerned. We are the suppliers to the auto- 
motive industry, and as they go, we go, as they go down, we go down. 
We can't increase our business very greatly except by taking business 
away from competitors and getting more for ourselves, which means 
less for the other fellow. The parts industry has practically no 
influence upon the total volume of automotive business. Therefore, 
these men from the automobile industry can answer that question 
much better than I can. 

Mr. Arnold. Mr. Roberge, do you understand the question? 

Mr. Roberge. Yes. 

Mr. Arnold. It charges that the responsibility for the prospective 
reductions rests with the industry. Mr. Thomas's contention was 
that the union recommended to Government officials and to business 
last November that the automobile companies should start a conver- 
sion over to defense production, instead of devoting their energies to a 
prosperous season and the designing of new models. 

Mr. Roberge, what proportion of Ford's normal civilian facilities 
has been converted to defense production? 

DIFFICULTY OF CONVERTING FACILITIES TO DEFENSE PRODUCTION 

Mr. Roberge. I would say comparatively little, in our particular 
case, because our organization is highly specialized, and it would be 
difficult to convert the majority of our machinery to defense work 
unless it consisted ^of trucks or something akin to what we are now 
building. 

We have built an airplane-engine plant which is now in operation, 
and the employees are drawn entirely from our automotive work. 
In addition, we have under construction a bomber plant at Ypsilanti, 
which probably won't get into production until early next year. 
Those employees will also be drawn from our automotive industry. 

But it isn't simply a matter of converting our present machinery 
to some other form of manufacturing operation. That would be very 
difficult to do. 

Mr. Arnold. Could you have curtailed automobile production last 
November, and started in production with your present plant instead 
of building of new plants? 

Mr. Roberge. It depends on what particular article we were to 
manufacture, and also whether we had the order for that particular 
item at that time. 

Mr. Arnold. Of course, I mean the articles that you are now manu- 
facturing. 

Mr, Roberge. Airplane engines? No. 

Mr. Arnold. That would not have been possible? 

Mr. Roberge. No, sir. 

Mr. Arnold. Mr. Wilson? 

MANUFACTURERS TENDERED THEIR SERVICES FOR DEFENSE PRODUCTION 

Mr. Wilson. Personally, I think it is a very unfair criticism of the 
industry, because I know the spirit of the industry — the men in it — 
not only in General Motors, for I am well acquainted with most of 
the men in the industry. On October 15, 1940, when Mr. Knudsen 
talked to the Automobile Manufacturers Association in New York, 



7364 DETROIT HEARINGS 

the whole group went on record in a formal statement of policy on 
the matter. All of us, not only the General Motors Corporation but 
all others in the industry, have stood ready to take any project that 
we could get or that any department of the Army or Navy or O. P. M. 
wanted us to take. 

I don't know of any refusal by the manufacturers to use their 
organizations and facilities for defense work. 

There is quite a misconception about the percent of facilities in the 
automobile business that can be used to produce defense materials. 

I know in our case I made an offer to use the Tonawanda-Buffalo 
plant on defense months before it was accepted. I think the criticism 
you quote is very unfair and shows a lack of knowledge of how to run 
a manufacturing business. 

Mr. Arnold. Last October, then, the industry did not say: "We 
will go into defense production after we have a profitable automobile 
season"? 

Mr. Wilson. No, no. In fact, I have the resolution. I don't 
know whether it has been put in your record or not; if it has not, it 
should be. 

The Chairman. We will permit it to be inserted.' 

Mr. Wilson. The resolution was drawn up October 15, 1940, and 
as far as I know, no one has built a motor car that got in the way of 
defense. There was no labor shortage of any importance that I 
was acquainted w^ith in Michigan or anywhere else in the automobile 
industry. 

We had no employment problem. We could hire all the men we 
wanted to do any jobs that came up. 

One thing that is overlooked is that this defense program started 
as a relatively small one a year ago in June and July and that even up 
to about the middle of last April, only about $15,000,000,000 of con- 
tracts had been let by the Army and Navy. As far as I know, no 
one in the automotive industry has refused to take any contracts or 
has been unwilling to use any facilities that he had. 

The machine-tool equipment m our plants is mostly specialized 
for specific purposes, and perhaps 15 percent of it at the most can be 
used on a particular defense project. That 15 percent is usually the 
type of machinery that can be the most easily obtained, so that hasn't 
been much of a help. 

GAP BETWEEN APPROPRIATION AND PRODUCTION 

The Chairman. Mr. Wilson, did the bottleneck come after the 
Congress had passed the big appropriations? Is there some gap 
between appropriation and production? 

We voted an appropriation of $7,000,000,000 in the lease-lend bill. 
The President's message stated that only $190,000,000 of it had been 
spent. Is there some gap there? Do you see what I am trying to 
get at? 

Mr. Wilson. There most assuredly is a gap. If you start out 
today to buy somethmg that is all designed and in production, but 
your supplier has not bought the material for it and has not started 
the fabrication, you will be lucky to get it in 3 months. 

1 See Exhibit B, p. 7347. 



NATIONAI. DEFENSE MIGRATION 7365 

If it is something new that requires toohno:, even though the suppher 
has the machine tools and the plant to make it, you will be lucky to 
get it in 6 months. 

If he has to buy new machine tools and build additions to his plant 
or change the plant materially, get material and get organized to do it, 
9 months will be a good job. When you pass an appropriation in 
Washington, you must realize that money alone won't produce the 
goods; that a lot of human effort has to go into the job somewhere, 
and that we have to get the tools and organization together first. 

The Chairman. In other words, it still takes 9 months; is that what 
you are trying to say? 

Mr. Wilson. It certainly does. 

Mr. Arnold. I think the charge of Mr. Thomas was that instead 
of converting your Buick plant at Flint, a plant was started in Chicago, 
and his contention was that a conversion could have been made much 
more quickly in the Flint plant than to build a new plant in Chicago, 
where you don't have the skilled mechanics, and this unemployment 
could have been avoided by having done that. 

Have you any comment to make on that? 

EXPLAINS location OF PLANT IN CHICAGO 

Mr. Wilson. If you think it will be enlightening, I shall be glad to 
do so. In the project that you are talking about — the Buick-Pratt 
& Whitney engine project — part of the work will be done in Flint. 
That is, Flint will be a supplier of the Melrose Park plant, just as our 
Cadillac division here in Detroit is malving parts for our Allison 
engine plant in Indianapolis. To the degree that buildings, equip- 
ment, and processing fit in, we are putting that work in Flint. 

The main assembly plant on the motors could have been put in 
Flint or perhaps any other place. At the time the decision was made, 
we made a survey of unemployed people and the number on relief, 
in several different territories. 

We were also desirous of spreading the corporation's activities in 
better proportion to the amount of business that we receive. For 
instance, the amount of busmess we have in the State of Illmois, in 
proportion to the magnitude of the corporation's operations, made it 
advisable to locate this plant there. That was one reason we built our 
Diesel electromotive plant near Chicago at LaGrange. Besides, we 
felt we already had a tremendous obligation to the city of Flint in 
proportion to its size. 

We did not foresee the present drastic cut in the automobile business. 
Personally, I believe the necessary curtailment could have been less 
severe had the flow of material been better planned. 

MALADJUSTMENT OF MATERIAL FLOW 

It is much easier to disorganize things than it is to reorganize them. 
There is at present a maladjustment of material flow. There are 
people getting material on priorities who are going to have it piled up 
in the mud and will not use it for months. This is going to cause a 
shortage of supply in the automobile industry. 

The Chairman. What do you suggest to remedy that situation? 



7366 DETROIT HEARINGS 

Mr. Wilson. Years ago in the automobile business we learned how 
to schedule the flow of material and the production of parts, and that 
is really the essential of the mass production idea. 

It isn't conveyors that are so important. It is really a planning of 
the business on a progressive flow of material with interchangeable 
parts and balanced production operations. 

We in the automobile industry learned how to do that, not perhaps 
because we were so smart, but out of necessity. With our own annual 
model-change program, if we didn't properly plan the flow of our ma- 
terial, we had a lot of unbalanced material left at the end of the model 
run on which we had to take a big loss. 

On the other side, if we didn't get the thing started on time, we 
wouldn't get our production out; so the industry has learned how to 
lay out a business and run it. 

It isn't much of a trick to run something that has been going along 
for years doing the same kind of thing ; but if you have to shut that 
down and start it up again every now and then, you had better get your 
operations balanced and control what is going on. 

SUGGESTS STUDY OF MATERIAL FLOW 

Now, my suggestion would be that more of a study be made of the 
flow of material in the country to defense industries. If a man takes 
a contract for 1,000,000 shells or 20 boats, or what not, he is gomg to 
need a certain amount of material; but he doesn't need to buy it all 
right now and have it all shipped to hun. 

The Chairman. Mr. Wilson, don't you think that we need an in- 
ventory in this country of labor, skilled and unskilled, and of material 
and other supplies? In other words, if the Army and Navy needs 
50,000 tons of steel, and we have a production of 100,000 tons, don't 
you think it wise to arrange an equitable distribution of the balance of 
that supply, a fair allocation for civilian needs of the country? 

Mr. Wilson. As far as I know, no one has appraised the require- 
ments of the defense program in terms of material. 

The Chairman. We haven't found any such appraisal. 

AUTOMOBILE INDUSTRY KNOWS ITS REQUIREMENTS 

Mr. Wilson. We know in the automobile business how much steel, 
copper, zinc, nickel and everything else goes into 1,000,000 cars, or 
100,000 cars, and we know how we want each kind of material to come 
in. And the same thmg should be done on the defense projects. 

As near as I can find out personally, the defense requirements for 
raw materials are not as tremendous as many people think. 

The Chairman. Have you any reason to believe that the Army and 
Navy are storing up, unnecessarily, great surpluses of materials? 

Mr. Wilson. I don't know of a specific case. I know that it is a 
very human thing to want to store if one thinks there is going to be a 
shortage. 

The Chairman. You are not doing that, are you? 

Mr. Wilson. We are following our standard procedure. 

Probably we are going to run out of certain things because we 
haven't stored. 



NATIONAL DEFENSE MIGRATION 7367 

In General Motors, we run the business on a 3-month forward sched- 
ule, plus the current month. To buy material beyond that requires 
special approval. . . 

Our various opeiating divisions try to run withm that limit. At 
times you have to make your commitments beyond that, but in normal 
times, that schedule usually takes care of the situation. 

FEAR CREATES SHORTAGE 

Probably you recall what happened when the report went around 
that there would be no more silk for stockings. Ail the ladies rushed 
to the stores to get then- stockings, didn't they? Now, as soon as the 
word goes out that zinc is gomg to be short, everybody who needs some 
zinc or has made a commitment to supply material using zmc — he 
may have made the commitment over a year ago — will try to get that 
zinc right now, so lie can make good on his commitment. If he has 
committed himself to a price on the finished article he is going to try to 
get the material to make good on his price. He is going to try to get 
it right now. 

The Chairman. What would you have recommended, Mr. Wilson, 
that the ladies do? Would you have said, "Don't wear silk stockings," 
or, "Don't wear stockings at all?" 

Mr. Wilson. No ; I am saying it is a very human thing for every- 
one — Army, Navy, ladies, or anybody else — to try to protect one's 
own situation. You are almost sure to create a shortage as soon as 
you have a fear of a shortage. 

Mr. Arnold. Mr. Wilson, I wonder if you would tell us how the 
survey was made in Flint, and whether we could have a copy of it 
for the record? 

flint project RELATIVELY SMALL 

Mr. Wilson. I think I have a memorandum of the figures reflecting 
the unemployment situation which was a factor in our decision. I 
would like to point out in addition that this is a relatively small proj- 
ect as compared to the requirements of the whole General Motors 
problem. 

If I remember correctly, the Melrose Park plant is around 1,000,000 
square feet. General Motors has over 60,000,000 square feet of 
plant space. 

The Chairman. Isn't your policy in this instance the same that is 
being followed in many other defense industries? 

STANDARD OF LIVING MEASURED BY CONSUMPTION OF GOODS 

Mr. Wilson. You mean starting new plants in new places? I 
don't know. Generally speaking, I think the point of view has changed 
somewhat during the past 12 months. As I remember it, before the 
election there wasn't a great deal of emphasis put on the fact that 
we were going to be short of a lot of things in this country. The way 
I look at it right now, we are not going to have plenty. The standard 
of living is not measured by the wage per hour but by the consumption 
of goods. That is the thing we have to live by, so if we are going to 
curtail a lot of things in this country, we are going to have a reduced 
standard of living. Lots of people are going to be without the things 
they have been accustomed to for years. 



7368 DETROIT HEARINGS 

Mr. Arnold. Now, would you indicate what proportion of your 
normal civilian production facilities has been converted to defense 
production? 

Mr. Wilson. I am not accustomed to thinking of it m those terms, 
so I can't very well give it to you. 

PROPORTION OF FACILITIES IN DEFENSE PRODUCTION 

Out of around 300,000 employees last June, about 200,000 were 
working on passenger-car production. The other 100,000 were work- 
ing on defense items, refrigerators, Diesel locomotives, and the other 
products that the corporation makes, including trucks; so that this 
reduction in business affects the 200,000. 

In other words, this schedule that is in prospect for next May, 
June, and July is, in the case of the corporation, something around 30 
percent, or a little less, of the production in 1941. Seventy percent of 
200,000 would be 140,000 people, and that is a good many people to 
organize in other work in that length of time. 

Out in the corridor I have a chart, which I happened to have pre- 
pared for other reasons, that lists the products the Corporation is 
maldng. I think if you gentlemen would care to look at it you will 
get a picture of what the Corporation is doing.^ 

HAS OVER 500 ORDERS FOR DEFENSE 

We have over 500 orders for defense. We are making good on sub- 
stantially everything we have contracted to do. We are not behind 
on anything important, and most of our projects are well ahead of 
our promised deliveries. 

I am a little bit embarrassed about giving you the facts, because 
the Army and Navy have asked us not to talk about production 
figures in terms of Allison engines, or so many shells, or so many 
gui's. I have the figures, of course. 

Mr. Arnold. We don't want you to divulge anything that is 
confidential. 

PERCENTAGE OF MECHANICAL-GOODS PRODUCTION CAPACITY 

Mr. Wilson. I can show you some other charts also, if you want 
to pass them around, showing how we are up to date.^ 

I beheve the production facilities of General Motors Corporation 
are underestimated by most people. The corporation has perhaps 8 
percent of the durable-goods production capacity of the United 
States. It may seem as if we have been given a good many defense 
contracts but they total less than 5 percent of the value of all defense 
contracts. We have worked hard at it. Perhaps some people have 
criticized the fact that a big corporation was given so much business. 
But actually we don't have our proportion of the load, with relation 
to our ability to produce, and we have the big shot of the unemploy- 
ment and the big shot of the change over. Tliis is because we haven't 
built so many new plants.^ 

1 See p. 7344. 

' See table, Exhibit E, p. 7349. 

> See Exhibits F and O, pp. 7349 and 7350. 



NATIONAI. DEFENSE MIGRATION 7369 

I think I read somewhere that 800 plants had been built in this 
defense program. Certainly the corporation hasn't got its share of 
those 800 plants. 

Mr. Arnold. I will repeat this question for Mr. Conder, because 
he was not here when I asked it before. 

Mr. Conder, in his statement this morning, Mr. Thomas testified 
that the major responsibihty for the prospective reduction in employ- 
ment in the automobile industry rests with the industry itself. The 
union's contention apparently was that the industry preferred to 
extend the prosperous automobile season rather than convert its 
facilities to defense production. 

In order that the record be complete, I should like to have you 
gentlemen indicate what proportion of your normal civilian facilities 
has been converted to defense production. 

Mr. Hill. Wouldn't the answer to Mr. Thomas' question best be 
arrived at by asking the authorities in Washington who had the plac- 
ing of these orders to give us a list of those automotive concerns who 
had refused to start an order when asked? 

THINKS NOBODY IN AUTOMOTIVE INDUSTRY HAS REFUSED TO COOPERATE 

Mr. Hill. I think you would find that list difiBcult to get. That 
is, I don't think it exists. I don't think that anybody in the auto- 
motive industry has deliberately refused to cooperate with the Gov- 
ernment. 

In our own experience (Murray Corporation) some of the aircraft 
industry representatives came to our plant last August and looked it 
over. We had some vacant floor space and they said it was adaptable 
to aircraft work. From that time until the time we got our contract, 
before we knew whether we were going to get business or not, our 
company expended upwards of $100,000 of our own money and sent 
some 70 men to the Pacific coast to receive training. 

I cite that, not in especial praise of our organization, but as typical 
of what I believe was done throughout the entire automotive industry. 

Mr. Arnold. When did you start production in that space? 

Mr. Hill. We are just starting production now. We have to go 
through the preparatory period too. 

I would like to cite another typical experience. This doesn't happen 
to concern our own company, but one of the automobile companies 
in Michigan. At this time it is undertaking the job of building parts 
and complete bombers for the Army, and they have to have done in 
this area or hereabouts 6,000,000 man-hours of tool work before they 
can build an airplane. When you divide that by 8 hours per day, or 
10 hours per day, you can see how many man-days it will require and 
how many men would have to be employed. 

Mr. Arnold. What proportion of your normal civilian facilities, 
Mr. Hill, have been converted to defense work? 

Mr. Hill. I have to answer that much as Mr. Wilson did, because 
facilities could mean floor space, machinery, equipment, and so on. 

Forty percent of our employees are now on defense work, or in 
preparation for defense work. 



7370 DETROIT HEARINGS 

One other point regarding the building of new plants, that may be 
pertinent here: Many people are wondering why automobile manu- 
facturers haven't undertaken tnis work, and why they buildnew plants. 
The public generally does not appreciate that when an automobile 
manufacturer builds a new plant under a D. P. C. contract/ that plant 
belongs to the United States. He builds facilities that contribute 
nothing to his own welfare. Therefore, if he were selfish, he would do 
his very best to convert his own facilities for the defense program, 
instead of building new ones. Obviously the only reason he doesn't 
is because his own plants are not adaptable for the purpose. 

SOME EQUIPMENT CANNOT BE CONVERTED 

Mr. Weiss (Packard). In our own plant we did divert some floor 
space and some equipment to defense work, but the nature of these 
defense projects is such that the equipment that you use for auto- 
mobiles beyond a certain point just does not convert. In other words, 
defense requires different types of equipment, and in frequently larger 
numbers of units, and there must be space for it. Therefore, you 
require additional space and additional equipment in order to do 
the job. 

Mr. Arnold. Mr. Weiss, can you give us the percentage of your 
normal civilian facilities that has been converted at this time to 
defense production? 

Mr. Weiss. I can't tell you excatly, but I would say it was approxi- 
mately 15 or 20 percent. 

Mr. Arnold. Mr. Waldron? 

Mr. Waldron (Hudson). Our ordnance work requires an entirely 
different type of equipment from what we have, and it would be out 
of the question to convert any of our machine-tool facilities for that 
type of precision work. The equipment for ordnance must be uni- 
versal enough to take care of thousands of different parts. 

As Mr. Wilson says, most of our automobile equipment was pur- 
chased and designed for a special part, and is altered to take care of 
the same sort of part on the next model. 

Naturally, our present equipment is not adaptable to aircraft 
bomber sections. 

DEFINITION OF PRECISION WORK 

The Chairman. Mr. Waldron, would you define the expression 
"precision work," for the purposes of the record? 

Mr. Waldron. I did not mean to emphasize "precision" as much 
as I did the "universal" character or adaptability, of the equipment 
on fine ordnance work. 

We may have 50 parts of 1 breech mechanism to do in 1 day, 
and maybe 25 of a torpedo tube the next, and so on. Because of the 
diversity of the products to be manufactured, we had to have universal 
equipment, which we didn't have in our shops. 

The Chairman. What is precision work? 

Mr. Waldron. Ordnance work is in the category of precision 
work — gears and things of that kind. Those gears cannot allow any 

' Defense Plant Corporation. 



NATIONAL DEFENSE MIGRATION 7371 

backlash, and they have to be lapped. The equipment that we have 
had for making some of our automobile gears where backlash is 
desirable wasn't adaptable for that sort of thing. 

We were operating a naval plant, erected by the Navy for us to 
operate, and we were left with the problem of providing the new eqiiip- 
ment for the type of work which they required of us. They required 
us to build many types of products. 

Mr. Arnold. Did you say that none of your civilian facilities has 
been converted to defense production? 

Mr. Waldron. Oh, yes; we have some — our plant space, of course, 
and some of our equipment has been converted for die work for Martin 
bombers. 

Mr. Arnold. Could you give a percentage? 

TWENTY PERCENT OF EMPLOYMENT ENGAGED IN DEFENSE WORK 

Mr. Waldron. I couldn't give you the percentage of floor space, 
but we are using approximately 20 percent of our employment- 
normal employment — in defense work now, and that percentage will 
increase as the months go on. 

Mr. Arnold. Mr. Conder, do you understand the question? 

Mr. Conder (Chrysler). Yes." We have had the same experience 
as the other gentlemen have related. A little of our machinery is 
adaptable to the defense work which has been allotted to us. In a 
few instances we have moved machinery from automobile production 
to defense work, but by and large we have had to get more new 
machinery. 

We have one of the new plants that Mr. Wilson has referred to— a 
tank arsenal. There were no facilities that we could use to build 
tanks where we had been building automobiles. 

The majority of the machinery at the tank arsenal is new ma- 
chinery. I have sat in a number of meetings where there have been 
discussions of what machines can be used on defense work, and ar- 
rangements have been made to pull those machines from automobile 
production and put them on defense. 

AHEAD OF contract PROVISIONS ON SOME JOBS 

We have made every effort to do the defense job quickly and well. 
On the tank job and the Bofors gun job we are ahead of the contract 
provisions. We have had some difficulty in getting blueprints and 
engineering data. That has held us up. We have had some diffi- 
culty in gettmg the new machinery as rapidly as we were ready to 
use it. . 

Those things have improved. We are coming along very well on 
the tank job and the gun job. 

Mr. Arnold. Can you say what percentage 

Mr. Conder. I can't tell you the percentage, from the standpoint 
of employment or machinery ; but I do know that much of our defense 
work is being done on the floor space that was formerly used for the 
assembly and manufacture of automobiles. 

Mr. Carlton. I think, Mr. Chairman, these gentlemen, m their 
natural modesty, have overlooked the finest example of cooperation 
by industry that I have ever loiown, and I would hke to introduce or 



7372 DETROIT HEARINGS 

hand to this committee a copy of the final report of the automotive 
committee for air defense. 

The Chairman. We will insert it in the record.' 

EDUCATIONAL EXHIBIT ARRANGED 

Mr. Carlton. On the 25th of October 1940, Mr. Knudsen, General 
Arnold, and General Brett and several others came to Detroit. They 
had a meeting with about 100 manufacturers of automobiles, trucks, 
parts, tools, and dies. 

They asked for our cooperation in educating our industry in building 
bombers. By the 29tli of October this committee had leased over 
30,000 square feet of floor space. They elected a committee consisting 
of passenger car, truck, and parts manufacturers. They had an em- 
ployed staff operating by the 1st of November and started an exhibit 
with the help of the Air Corps. The Air Corps assigned Maj. Gen. 
James Doolittle to us. We conducted for months an educational 
exhibit, in which we set up actual parts of bombers and whole bombers, 
in huge floor space that we rented at our own expense. We invited 
all the manufacturers from the automotive industry and elsewhere 
to come and take a look at the terrific job that was before us to build 
bombers and bomber parts. 

Over 2,000 manufacturers visited that exhibit. Questionnaires 
were made out, and over 700 people turned over questionnaires giving 
their complete plant description, after studying the pieces they had to 
manufacture. 

Our job was first to educate the automotive industry and all industry 
in this territory as to what a bomber is, how it is made, how many 
hours it takes to produce a bomber. 

ONE bomber REQUIRES 8,000 BLUE PRINTS 

You might be interested to know that 8,000 blueprints were required 
for this Martin B-26 bomber, plus 50,000 hours of labor, excluding 
the Government-furnished parts, which are the motors, the landing 
gear, the tires, and the wheels and all instruments on the instrument 
board. 

Mr. Knudsen delegated through O. P. M. a number of men to work 
with this committee, and I remember the day they came to us and 
said: 

"Now, we have got to get in mind exactly what we want to do." 

100-PERCENT COOPERATION 

We called upon these people who are in this room and asked them 
to take definite parts of that job. I have never seen a more remark- 
able job of 100-percent cooperation than that committee had, under 
the name of the Automotive Committee for Au' Defense. All the 
expenses of that committee were paid by the committee itself through 
its various members. 

As a result of that committee, the Ford Motor Co. undertook the 
terrific job of building the B-24 consolidated bomber, which requires 
100,000 hours of labor outside of Government-furnished parts. 

» See Exhibit D, p. 7317. 



NATIONAL DEFENSE MIGRATION 7373 

General Motors undertook a part, and Chrysler undertook a part, 
and Hudson undertook a part, and then they subcontracted until I 
know today that there are at least 800 smaller manufacturers getting 
contracts for parts from all of these companies that are going to build 
these bombers. 

BOMBER PROGRAM AN OUTSTANDING COOPERATIVE JOB 

That bomber program is one of the outstanding cooperative jobs 
that I know about in the industry. 

Mr. Arnold. Of course, you gentlemen realize that we, as members 
of Congress, know that this Nation started the defense program with 
very few facilities for production. It was then a problem of conversion 
from peacetime industry to defense industry. We know the problem, 
but some of the people of the Nation don't understand it; and it is 
well to have this information brought out so that misunderstandings 
can be cleared up. 

Up until today I have never heard any criticism of the automobile 
industry. I have heard only praise of what the automotive industry 
has done toward speeding up the defense program. 

Mr. Carlton. As managing director of that committee, I con- 
tacted every manufacturer of automobiles, trucks, and parts, and 
never were we refused when we asked one of them to do anything. 
Most of them came to us and said: 

"You are not asking us to do enough," 

Mr. Arnold. That is marvelous cooperation and the Nation is 
certainly fortunate in having manufacturers who are organized as 
your factories are. 

Mr. Wilson. Having also been a member of that same committee, 
I would like to add a little comment, when Mr. Carlton reports on 
what we did and how we tried to cooperate with Government. The 
industry started out with a great deal of enthusiasm. We were some- 
what disappointed when we couldn't get hold of anythmg to go to 
work at for quite a while. 

You gentlemen might look up the dates when Congress actually 
appropriated the money to buy these bombers and when the teclinical 
job of deciding exactly what bombers we were to produce was com- 
pleted and when the contracts were fuially let. 

BOMBER program NOT DELAYED BY INDUSTRY 

I am suggesting you do that because I think there is going to be a 
little disappointment in the country — perhaps by early winter — that 
more bombers have not been produced. And I would like to make it 
clear that this was not due to lack of cooperation by the automobile 
industry. 

The Chairman. I am sure, Mr. Wilson, that today in America one 
of the most baneful influences is mdiscriminate criticism, criticism 
which is not based on facts. All this is very enlightening. We hear 
criticism on the floor of Congress, too, and that is one of the reasons 
why we are here. 

Mr. Carlton. Mr. Congressman, I happen to Imow that the Hud- 
son Motor Car Co., with whom I have worked very closely, spent 
$100,000 trving to find out how they could build aircraft before they 



7374 DETROIT HEARINGS 

got an order. I happen to know that the Ford Motor Co. spent 
many times that amount of money before they were even promised 
an order; and that is the way it went through the industry. 

Following that, the industry was very disappointed because it was 
many months before they could get hold of an order, or any letter 
of intent, that indicated that we might go to work on the job. 

DELAY IN ISSUANCE OF LETTERS OF INTENT 

All through November, December, January, and February nothing 
like a definite, official order was issued, or even the letter of intent. 
But this industry didn't wait for that. The Ford Motor Co. surprised 
us by having a plant all laid out, and all the engineering work done 
on the plant, long before they even had a letter of intent with any 
authority to go ahead and do anything about it. 

The Chairman. But, Mr. Carlton, let us be a little charitable to 
Washington. From the executive and legislative standpoint, it has 
been a big problem, too, hasn't it? To decide on priorities and price 
control and such matters as that is a tremendous job. 

Mr. Carlton. The Army and Navy and Air Corps started from a 
little bit of a business before this emergency, and have developed into 
the biggest business in the country in less than a year's period. They 
had a terrific job of organization on their hands. 

Mr. OsMERs. Mr. Carlton, the suggestion has been made to this 
committee since we have come to Michigan, that subcontracting would 
be vastly speeded up if the manufacturers of motor parts, the prime 
contractors in these defense orders, were loaded up, and that business 
would then go out to all of the suppliers, many of whom are today 
without employment or are facing the prospect of a loss of business 
with the curtailment of automobiles. 

Now, how is it that so many of the small businesses in the United 
States have been left out of defense work entirely? 

FARMING out OF CONTRACTS 

Mr. Carlton. There just hasn't been enough business to go around. 
The whole thing comes down to a matter of production plamiing. 
For example, our first idea of building a bomber was that we had a lot 
of vacant offices that we had leased, and we were going to ask each 
one of the bomber manufacturers who was tlie sponsor of a given 
ship that had been standardized by the Air Corps to set up an office 
with us, bring in all of his blueprints, and tell us what he wanted, and 
we would bring all the suppliers to him. We had a vision in the 
beginning of bringing a thousand suppliers in, and the bomber rnanu- 
facturers simply didn't have the organization to do the job. Finally 
it had to be handled just one way. Large jobs had to be turned over 
to certain organizations which were given the whole assignment of 
production and planning, which were then allowed to farm that 
business out. 

I have a great sympathy for the small manufacturer who has not 
been able to get any business, and I know a number of them who are 
closed entirely. 

Mr. OsMERS. I was thinking not so much of the man who didn't 
get any new defense business, but of the man who lost all his own 
business in addition to that. 

Mr. Carlton. I know a number of plants that are de&iitely closed. 







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00396— pt. 18 



7374-A 




7374-B 




73T4-C 




73T4-D 




2 S 



r374-E 










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7374-F 




7374-1 




r4-j 




r374-K 




7374-L 




7374-M 




1^^ 




In the background is shown the start of a defens? worker's home, in the outskirts of Detroit. Until he can 
finish the building in his spare time, his family must live in the tent. 



r374-N 




BUT 
YOURSELF 
A HONE 

LUMBER 
LABOR 

AND 

BUILT 



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ONLY 

BUY A 



\ WHY NOT ^Vt 
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LOT NOW 






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The build-it-yourself system of real-estate operations i^ lltmn.^luug in the viciniiy of (lie Chrysler tank 

plant in Warren Township. 



7374-0 



4£„^ 




Open water ditches menace the health of Warren Township. Sewage flows along roads which boys and 
girls must travel on their way to school (p. 7552). 




A green-scum-covered ditch in the southern part of Royal Oak Township receives the overflow from septic 
tanks. Alongside runs Eleven Mile Road, a main highway, and paths for the school children. (See 
p. 7694.) 



7374-P 



NATIONAL DEFENSE MIGRATION 7375 

Mr. OsMERS. Is there any hope for those peopkV? I am thinkiiio: 
now of the fellow who is in the position that the automobile manufac- 
turer was in — that is, he had his tools and his shop geared up for a 
certam operation, and he hasn't the financial strength to convert it 
into a defense industiy. 

Mr. Carlton. Of course, there are some people who just never will 
get any business because they haven't anj'^ equipment which is 
adaptaiale to the defense program. There are others who will got 
business as the defense program percolates, by subcontracting and 
by the present efforts of O. P. M. in establishing offices locally. 

They have placed a lot of business recently with small manufac- 
turers. 

The Chairman. Mr. Carlton, the time factor has exerted an in- 
fluence throughout these procedures, has it not? 

Mr. Carlton. Personally I don't believe it could have been done 
any better than it has been done. 

The Chairman. There was a time element there which represented 
the pressure. 

Mr. Carlton. Yes. 

Mr. OsMERS. Do you feel, Mr. Carlton, that the prospective cut 
in automobile production is too large at 50 percent? 

Mr. Carlton. I certainly don't want to stick my neck out and try 
to answer that question. I would like to amplify what Mr. Wilson 
said. I have stood in the offices of O. P. M. and heard representatives 
of the Army and Navy come in, demandmg material under priorities, 
and I have heard them admit that they don't need the material until 
1942. 

shortage of plates 

The subject of plates is one of my pet peeves. There is a shortage 
of plates today, and there are places where there are plenty of plates 
stacked up that won't be used until the last of next year, and some not 
until 1942, and because of that the automotive industry is greatly 
hampered and cut at the present time. 

That was a matter of timing and managing and planning, and I 
am told that no one executive had the authority to step into the Army 
or Navy and tell them how they must schedule their material, until 
the last Executive order creatmg S. P. A. B.,^ and in that Executive 
order, Mr. Nelson is given the definite power to schedule not only 
civilian but also defense production. 

When he starts doing that, I think there will be more steel available 
and more opportunities to build civilian articles than there are now. 

Mr. OsMERS. I gather, from your panel and from the union panel 
this morning, that the fault has not been at the point of manufacture. 
The fault has been in Washington. I have learned that you men in 
your capacities have stood ready to do j^our job, and labor apparentlj^ 
was ready to do its job; but orders were not forthcoming from Wash- 
ington. 

' Supply, Priorities, and Allocations Board. 



60396— 41— pt. 18 21 



7376 DETROIT HEARINGS 

NO HOARDING OF AUTOMOTIVE INDUSTRY 

Mr. Carlton. That is right; and I am willing to go on record in 
saying that there has been no hoarding of any materials by the 
automotive industry as a whole. The hoarding has been done by the 
Army and Navy. 

Mr. OsMERS. Now, as a general question for all of the panel: I 
believe that all, or at least several, of your companies have under- 
taken the construction of new plants for defense. When these are 
completed and in operation, what proportion of your defense capacity 
will be represented by thes(^ plants? 

Mr. Carlton (Motor Wheel Corporation). I can't answer that 
question because we built no new plants. We used our old plants. 

Mr. Conder (Chrysler). I can't answer that, but I can tell you 
how many of our people will be employed on defense, and I can tell 
you how many of those people will be employed on our present facili- 
ties that are used for automobile construction, and the number who 
will be employed in these new plants. 

Mr. OsMERS. Would you give us those figures, Mr. Conder? 

Mr. Conder. I have the number of employees in defense jobs that 
we now have, and I have the number of employees by plants. Do you 
want it both ways? 

Mr. OsMERS. The question that we are interested in at the moment 
is the one of plant capacity — that is, new plant capacity — as compared 
with the old plant, and the percentage of your defense work that will 
be done in the new plants and the percentage in the old existing 
plants. 

Mr. Conder. I haven't it worked out that way. As I say, I can 
give you the number of employees by plants. If I had some time I 
could work it out for you; 

The Chairman. We will give you the time, because our record will 
not be closed for a couple of weeks. If you forward the information 
to Washington, we will insert it as part of this hearing. 

Mr. Conder. Then I will work it out for you.^ 

1 The following letter from Mr. Conder was received subsequent to the hearing: 

Chrysler Corporation, 
Detroit, Mich., October SI, 1941. 
Mr. Harold D. Cl'llen, 

Associate Editor, House Committee Investigating Defense Migration, 

Washington, D. C. 

Dear Mr. Cullen: I have your letter of October 16, 1941. 

While testifying before the House Committee Investigating National Defense Migration, I was asked in 
substance how much floor space in our established plants was being devoted to defense work as compared 
to the floor space used in new plants for defense work. I stated at the time that I aid not think I could give 
this information, but suggested that I might be able to advise how many employees were working on defense 
work in the automobile plants and how many were working on defense work in new buildings. In checking 
into this matter I found that the situation changes so rapidly that any figures given would be interesting 
only as of the date covered and could not be taken as any indication of what tt;e situation would be at any 
time in the future. 

As the defense work dova^lops and as new defense work is taken on, different or additional manufacturing 
equipment is required. We are trying to use whatever facilities are best adaptable to the completion in the 
proper way of our defense work. Under the circumstances, no detailed figures covering any particular date 
will be furnished for the record. 
Yours very truly, 

(Signed) Robert W. Conder, 

Director of Labor Relations. 



NATIONAL DEFENSE MIGRATION 7377 

Mr. OsMERS. I realize that unless you came prepared to answer 
that question, it is going to be impossible to say offhand. 
Do you have any figures on it, Mr. Roberge? 

ANTICIPATES EMPLOYMENT ON DEFENSE WORK TO REACH 75 PERCENT 

OF PRODUCTION 

Mr. RoBERGE (Ford). Not in just that way. I believe when we 
are at capacity on our present defense orders, 75 percent of our 
present manpower will be employed on defense work. 

Mr. OsMERS. But you don't know what the plant capacity figures 
would be? 

Mr. Roberge. It would be difficult to say, because of the inter- 
relations between our present facilities and the new plant. Certain 
items are made in the present plant and shipped to the new plant. 

Mr. OsMERS. Do any of the other members of the panel have fig- 
ures on that? Mr. Wilson, do you have any? 

Mr. Wilson (General Alotors). I can make a statement on that. 
As far as I can remember, we have asked the Government to put up 
money for only one entire new plant, the Melrose Park plant near 
Chicago, and additions to two others. 

In other cases we have reorganized our existing facilities to make 
space available or put back in production idle space, or built new 
plants ourselves and used them for the purpose. 

Mr. OsMERS. Plants that you owned, built, and paid for? 

PROBLEMS CREATED BY GOVERNMENT OWNERSHIP OF PLANT 

Mr. Wilson. That is right; and one of the difficulties hes in the 
fact that you have a pretty good sized