I note with interest the studies and the surveys you say you have done with reference to the economic impact.

It does not seem to me it is enough, however, to say that you go into an area where the minimum wage now applies, retail stores that are now covered, and your survey shows that employment has gone up in that particular area in the past year or two, since the minimum wage was applied.

Quite frankly, it seems to most of us that the opportunities for unskilled or for low-skilled workers are increasing, but nowhere near as fast as the need for those opportunities makes necessary to provide the jobs.

Now, we are dealing here in an area, as you know, where there is a growth, a tremendous growth, of employment opportunities in the service area. With the increase in the economy generally and the increase in population, the total figures for a community, for retail employment, may be up.

The question is, Would they be up a great deal more if we did not have an imposition of a minimum wage in the situation?

Now, do your surveys take any account of the difference in trends that have occurred in employment, here?

Secretary WIRTZ. It is possible that we can. And we have never suggested that these surveys indicate that there is an affirmative effect on employment as a result of these increases in the minimum wage.

We have been quite careful, whenever we have been asked to make some of these studies, to report simply that we can find no evidence that they have had any diminishing effect.

It is the old matter of trying to prove a negative, and we know we cannot prove a negative. You just cannot do it.

But all we can say, Mr. Goodell, is that there is no evidence whatsoever, as nearly as we can ascertain it, of any depressing effect on employment.

For us to pretend to say more than that would be misleading.

Mr. ROOSEVELT. Mr. Secretary, on the other hand, it is affirmatively true that there is evidence that there is removed from the national picture people who are getting a below-standard wage; is there not? Secretary WIRTZ. Oh, yes.

Mr. ROOSEVELT. And this in itself, if you took in various factors of requirements on the local community, in order to make it possible for these people to live-the total cost is probably a good deal higher than it would be if you put them into a proper wage category, where at least they would get the minimum.

And therefore while the gentleman is worried about the total employment effect, total employment, if it went up but consisted of a submarginal group of people-this in the end could be far more costly, could it not, then if there actually were a few people who were affected: although you have said you do not think they are affected? Secretary WIRTZ. I have understated it. The evidence is quite clear that people who would otherwise receive low wages do receive higher wages. The evidence is also quite clear that employment has gone up in these same areas, among these same people, at the same time.

And I lean way over backward in saying that we cannot establish any affirmative relationship between those two.

But these things are true. There is no evidence of any diminution of employment. There is affirmative evidence of increase in employment. And there is affirmative evidence of increase in the earnings of these groups, all at the same time.

Mr. GOODELL. Mr. Secretary, I have respected very much your various pronouncements on the problem of providing job opportunities for lower skilled categories of workers in our economy.

You would agree that one of the most important responsibilities we have in society today is to increase the employment opportunities for people with low job skills?

Secretary WIRTZ. If, in the context, you mean to imply that I think we should do that when part of it is paying them less than a decent wage

Mr. GOODELL. I did not mean that. I meant it exactly as I stated it, that this is one of our major responsibilities today, to increase job opportunities for these people who have no particular skills?

Secretary WIRTZ. Yes, but in the context of this hearing, I would have to say that I believe that to be true, but I think that these job opportunities should carry a decent wage.

Mr. GOODELL. Fine. I do not mean to argue that point.

But I think in talking about the value of the minimum wage, and the fact that we should not pay individuals less than the minimum that is required for them to live, we should recognize that there is a price we probably are paying, here.

I do not blink at that price. I think the price is there. We do diminish the job opportunities for these people. We do accelerate automation in many of these areas, where it suddenly becomes more economical for an employer to substitute some sort of equipment, machinery, or a self-service, some other method, for individuals. Now, these are just the economic facts of life.

Secretary WIRTZ. No, I disagree, Mr. Goodell.

Mr. GOODELL. Economic opportunities in that category may generally, in a city-the total number employed may go up, but they are not going up as fast as they would have if we had not accelerated the process.

Secretary WIRTZ. I do not agree, and find no evidence whatever to support it.

Mr. GOODELL. This is one of the things that always bothers me. It seems to me we have to be very realistic about this, and this is just so obvious a result. No one has come to me and shown me how you increase job opportunities for these people by increasing minimum wages, and you have said that you do not increase job opportunities.

Secretary WIRTZ. That is correct.

Mr. GOODELL. All right. Now, it is so obvious that there is an effect of decreasing job opportunities when you raise the cost to the employer of every employee in this category. This is just an automatic reaction that anybody that understands business knows occurs.

Now, I am not taking the next step, and saying, "All right, that justifies our keeping these people at a starvation wage." We have to balance these two. But let's at least be realistic enough to recog nize that we do not have to balance the two. And it is important to keep enough job opportunities here for these individuals.

Mr. ROOSEVELT. Mr. Secretary, I just want to say that I do not accept that wholly, as the gentleman has stated it. I think there are obviously other factors which we have recognized, which is simply that automation is inevitable, anyhow, it is going ahead, and we have attacked the creation of job opportunities on the basis of upgrading skills, and not upon the basis of saying that we must keep unskilled jobs available at a low wage rate.

Therefore the statement the gentleman just made seems to be rather pointless, because it is not leading anywhere, and the fact is that we are leading somewhere when we increase the purchasing power of the people with less skills where those jobs exist, and then we attack the problem of upgrading the skills of the rest of them to make other job opportunities available to them, as they are obviously appearing in the economy.

Is that not right, Mr. Secretary?

Secretary WIRTZ. I was afraid I was not entitled, in the absence of a question, to enter into the discussion.

Yes, I think what you say is right, and in amplifying the answer would say only that I think there is no evidence whatsoever of a diminution in jobs resulting from the increases in wages which we have been talking about.

Now, it is perfectly obvious as a matter of abstract logic that to establish a $15-an-hour minimum wage would result in a diminution of employment. Completely obvious. But we are talking, as you say, in realistic terms.

And we have come to this committee only on the basis of a cautious determination that in the areas which we are talking about, here, as far as employees are concerned, and as far as dollar amounts are concerned, there is no basis that we know of in realism, if you will, for an assumption that these changes will diminish employment by a single person.

Mr. GOODELL. You see, my problem here, Mr. Secretary, is that we always have to jump over to the conclusion that minimum wages are very important, and we must raise minimum wagse, because this in itself is good.

I have no quarrel with what Mr. Roosevelt said. Obviously, we attack the problem of the unskilled from many different directions. As he knows, and as you know, I am a very strong advocate of this, and of the retraining and all the other ways that we go about this. But all I am saying is that we are not considering those other measures, now. We are talking about the impact of increasing minimum wages.

And when the advocates are unwilling to be realistic enough to recognize that there is this impact, it is the price we pay. And maybe what we are buying for it is worth that price many times over.

But that is not the issue. The price is there. And when you refuse to admit that there is any price we are paying for it, then it seems to me you are closing your eyes to the economic business facts of life. They are there.

Secretary WIRTZ. I respect your judgment, sir, without being in a position to agree or disagree with it.

Mr. PUCINSKI. Mr. Secretary, I think you can probably answer the question of the gentleman from New York by taking a look at what

has happened to the retail industry since we put it under the mini

mum wage.

Now, we had all sorts of dire predictions as to what was going to happen if we did this. And I recall 2 years ago, I believe it was, we did it, and as far as I know, and you probably have the figures there, and maybe Mr. Lundquist has some specific figures, but as far as I know, there has been no job displacement, because we put the retail industry, or at least a large segment of the retail industry, under minimum wage standards.

On the other hand, I think that we can say that one reason why we have had, among many reasons, a sustained level of economic growth, is because of what we said 2 years ago, that by putting & number of people under the minimum wage, we would increase the economy of the Nation.

Mr. GOODELL. I do not want to yield any longer.

I do not want to argue it at this stage. I will go on with the Secretary and ask some other questions.

Mr. PUCINSKI. Do you want some other figures? Mr. Lundquist

has them there.

Secretary WIRTZ. May I, Mr. Goodell, add one elment to my previous answer, which was about the tips? Because my answer was incomplete and should have included a reference in our proposal to act on this as you do in New York, which is to make a determination as to what the usual relationship between wages and tips is. We have that clearly in contemplation.

For instance, in the administration of your New York act, you provide that on the $1.25 an hour for restaurants, there is an allowance of 35 cents an hour for tips for service employees.

And as I said in my earlier statement, we expect to make some administrative determinations of that type.

Mr. GOODELL. I am very anxious that we do go into this in a little greater detail later, after we see your proposals on it, because I think it is one thing to do this for a State, where the economy is relatively compact, homogenous. If you are going to have national standards of this, then I think you run into some serious problems.

And I would like to know whether you plan to do it on a State basis, a prevailing wage, a prevailing tip pattern, or whether you do it on a regional basis, or whether you are going to do it nationally across the board, how you are going to select the different types of hotel and

restaurant.

Obviously, your big resorts, your expensive places-the tip pattern is quite different than it is in your host restaurants and things of this nature.

I would like to go into greater detail on that, but I think we should do that perhaps after you come forward with your administrative proposal.

Secretary WIRTZ. I do not want to leave it that way. Our administrative proposal will be to have authority under the statute to make an administrative determination of that based on what we find to be the facts in the particular case.

Mr. GOODELL. What argument are you going to present to us in the meanwhile?

Secretary WIRTZ. We have presented a proposal for legislation which would permit us to make that administrative determination. Mr. GOODELL. What else? I understood you were going to present some background and factual data here which would give us a little better idea of what you were going to do in this field.

Secretary WIRTZ. What you have so far asked for is information which would give you these figures which are in the statement, in terms of the inclusion of tips, and also a statement covering the rules with respect to the inclusion of particular units in larger enterprises. Those are the principal requests so far.

Mr. GOODELL. Mr. Secretary, let me ask you just a technical question, here.

With reference to the transportation industry, the present law exempts from the overtime provisions those who actually do not have established, where there is the power of the ICC to establish, overtime requirements.

As I understand, what you are proposing here is that even though the ICC has the power to establish overtime requirements, if they have not established them, they will be covered, under this law. Is that correct? Secretary WIRTZ. May I ask the Solicitor on that?

Mr. DONAHUE. Mr. Goodell, you wanted to know the present state of the law?

Secretary WIRTZ. No, does this provide for coverage under this legislation of employees with respect to whom the ICC could have established overtime coverage but has not, in the exercise of its power.

Mr. DONAHUE. The answer is "Yes." It would cover those employees. But as soon as the ICC exercised its authority to establish hours for employees, then those employees would be exclusively covered by the Motor Carriers Act.

Mr. GOODELL. Then let me ask you the question: In other words, one agency now has the authority to establish, here, standards for overtime, but they have not utilized it. They have chosen, with their knowledge of this particular industry, not to utilize that authority. We in effect are saying, "You haven't utilized it, so we are going to do it under the Fair Labor Standards Act."

Secretary WIRTZ. That is right.

Mr. GOODELL. You make reference that you have done your study with respect to 7(e) and so forth. Can you make that study available to this subcommittee?

Secretary WIRTZ. That is the one to which Mr. Lundquist referred earlier, in terms of the study of last year.

Mr. GOODELL. Has there been an updating of it since that?

Secretary WIRTZ. I think not, materially. It involves the interpretation of the older provisions.

Mr. GOODELL. You did not send this to the committee last year? Secretary WIRTZ. Yes; we did.

Mr. GOODELL. Does the committee have copies?

Mr. LUNDQUIST. If not, we have others available.

Mr. ROOSEVELT. Send us over a couple more copies. I am not sure we have enough in the committee.

Mr. Daniels?

Mr. DANIELS. Mr. Chairman, I would like to present one hypothetical question to the Secretary. Perhaps you can answer it. If not, you might let the committee have the benefit of your views at a later date.