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It is thus apparent that this cannot be left to the States and that the obligation and the responsibility is here with us.
The statistics I have quoted point implacably to one conclusion—the need for prompt and effective action and that the time for action is now. Each day that we delay such action adds to the workers' fear of unemployment and undermines that security which is so essential to their welfare. It is by such action, and by such action alone, that the Federal-State unemployment compensation program will be able to meet the challenge of the serious period of recession which we are experiencing today.
STATEMENT BY Hon. JOHN J. DEMPSEY, REPRESENTATIVE FROM THE STATE OF
NEW MEXICO IN SUPPORT OF H. R. 9430 : Mr. Chairman and committee members, there is an imperative and urgent need for enactment of this legislation due to the economic trend in our Nation as well as in the world in general. We are confronted with a greater degree of economic uncertainty at this time than at any other period since the early 1930's. At that time, however, we knew definitely that the only preventive for virtual economic collapse was immediate and drastic action by the Government to provide a stimulus that private business and industry were incapable of supplying. As a result the Federal Government assumed à responsibility and a relationship in regard to such economic factors as unemployment that makes it incumbent upon the Congress to legislate whenever a maladjustment occurs. This legislation is proposed for the purpose of remedying a situation which has become increasingly inequitable and unjust to that segment o American workers who have been forced out of profitable employment by the economic readjustment our Nation is undergoing.
Although the unemployment situation today has not grown to the proportions that it did in what are known as the depression years, it has, nevertheless, become serious enough so that many thousands of our American citizens are undergoing privation and hardship. We can and must correct that condition. It does not brook delay.
Many of these unemployed workers are idle as the direct result of Federal Government policies that are manifestly unfair to them. As a case in point I would direct your attention to the lead and zinc mining industry in my own State of New Mexico as well as in other Western States. Our lead-zinc mines have been closed down for more than a year. The miners and their families for the most part have been unable to find other employment or means of livelihood. The unemployed miners received compensation payments that were entirely inadequate to provide even the necessities of life for their families. Those payments were made for a period of only 26 weeks as provided by law, less than one-half of the time that they have been idle. Today they are dependent on meager supplies of surplus commodities given them through relief channels or upon a mere pittance which can be provided through private charity. We boastingly tell the world that want and privation cannot happen here, but it is happening
The principal responsibility for this deplorable situation lies right here in the Congress. We have seen fit to enact trade-agreement laws which permit the flooding of our domestic market with imports of lead and zinc with the result that our own mines cannot operate profitably. We have provided work for miners in foreign countries and put our own men out of jobs. We have continued to ignore this fact and even now are being asked to extend, for at least another year, the very trade agreements that are doing this economic damage.
This proposed legislation will at least have some curative effect. It will relieve in some degree the hardships being endured by the unemployed. In virtually every State unemployment compensation today is based upon cost of living of at least a decade ago. In the meantime that cost of living has doubled. Wages have been increased. Employers have recognized this condition by willingness to include escalator provisions in contracts with their workers, provisions which are intended to equalize income with living cost.
Even under the unemployment compensation scales provided for in this legislation it will be difficult for jobless workers to have for their families and themselves the barest necessities of life. Other proposals contained in the legislation are intended to equalize payments and to standardize conditions under which those payments can be made. This proposal is directly in line with policies enunciated by the President of the United States, by the Secretary of Labor, by the Federal Advisory Council, the National Conference on Labor Legislation, and the Joint Congressional Committee on the Economic Report. There is complete unanimity in recommending that the Congress take action now to correct the inequities which it has helped to create. Most certainly there is no justification for our failure to take this action.
STATEMENT BY REPRESENTATIVE ELIZABETI KEE, DEMOCRAT, OF WEST VIRGINIA,
ON LEGISLATION TO BROADEN COVERAGE AND INCREASE BENEFITS UNDER UNEMPLOYMENT COMPENSATION LAWS
I am wholeheartedly in accord with the proposals before this committee to expand the coverage of unemployment compensation to take in an estimated 1/2 million workers in private enterprise and about 274 million Federal employees not now covered, and to increase substantially both the benefits paid and the duration of those benefits.
As members of the committee know, I have joined with 80 other Democratic Members of the House in sponsoring the Forand bill, H. R. 9430, which would authorize paying unemployment compensation for a maximum period of 39 weeks and would raise benefits by about 50 percent.
In the case of West Virginia, this would mean an increase in the period of benefits from the present maximum of 24 weeks to 39 weeks; it would mean an increase in benefits from the present maximum of $30 a week to a top limit of $46 each week.
The higher figure is determined by the use of the same formula recommended by the President earlier this year in his appeal to the respective States to modernize their programs. His proposed formula, which H. R. 9430 adopts, would base benefits on one-half a worker's regular wage up to a maximum of two-thirds of the average weekly wage in a particular State.
Under this bill, a worker would receive the maximum benefit of $46 a week (which is two-thirds of the average weekly wage of $68.33) providing his regular wage was at least $92 a week. For any unemployed worker whose regular weekly wage was less than $92, his benefit would be one-half of his regular wage. Thus it can be readily seen that comparatively few of our production workers would be eligible for the $46 maximum, because in most of our industries, wages have not generally been as high as $92.
On the other hand, I believe the majority of our eligible workers would easily qualify for more than the current maximum of $30 a week, if benefits were determined at one-half the worker's regular wage.
I should like to impress the members of this committee with the urgency of this matter, because unemployment is alarmingly high in West Virginia, with most of our business centers in the State listed by the Department of Labor in the group IV, or distressed, category. These are areas with more than 6 percent unemployment. Many of our areas, in fact the majority, have unemployment levels of 12 percent or greater. The suffering is great.
Those between 6 and 12 percent include my own hometown of Bluefield, as well as Charleston, Clarksburg, Fairmont, Huntington, Parkersburg, and Wheeling. Those with 12 percent or more include Beckley, Logan, Morgantown, Point Pleasant, the Ronceverte-White Sulphur Springs area, Welch, and Williamson. All through these areas and throughout the entire State, a total of 120,000 West Virginia citizens are dependent upon surplus foods to keep body and soul together. Without this food, actual starvation would already have prevailed.
Thousands of our West Virginians, especially in the coal areas, but also including former workers in other industries, have exhausted present maximum unemployment compensation benefits. Each week the list grows longer. Extending the period of benefits from the present 24 weeks to 39 weeks would be of incalculable help to these people, and would help channel needed purchasing power into the hands of families which are destitute.
I cannot urge too strongly the importance of prompt action by the Congress of the United States in bringing our unemployment compensation system into line with current requirements. The benefits are at the present time wholly inadequate—$30 a week does not go very far in feeding and housing and clothing a family, and the present 24-week period of coverage does not begin to cover the time in which many of our unemployed have had to wait to find work. Throughout our State, losing a job has been a major tragedy for many, because it is not a question of going from one job or one industry to another-all of them are furloughing or discharging workers due to lack of business.
Therefore, I feel that I must again express my full support for the Forand bill, which I regard so highly that I have added my name to its list of sponsors. And, at the same time, I again strongly urge your favorable action on this measure in order to bring in additional workers in private employment as well as Government employees. In my home State of West Virginia, the added coverage provisions of this bill would bring nearly 60,000 employees of some 21,000 small employers under the law for the first time-nearly half of them in wholesale and retail trade, about 12,000 in the service trades, 3,500 in mining, 3,800 in construction, 4,000 in manufacturing, 2,200 in public utilities, 3,300 in finance, insurance and real estate, and about 2,300 in miscellaneous categories.
While West Virginia is down almost at the very end of the list of States in the number of Federal Government employees, I think all of us in West Virginia would like to have our 10,500 Federal employees—less than one-half of 1 percent of the Government's total-also covered into the unemployment compensation system. It is only fair to these people that when the appropriations for the agencies for which they work are reduced and some of them must be let go, that the discharged Federal employee also have this protection of unemployment compensation.
One last word to bring to your attention the seriousness of our employment situation in West Virginia, and therefore to point out the need for better unemployment compensation. When nearly 13 percent of all the people in the State covered by unemployment compensation are out of work-as the latest figures released by the Department of Labor reported—then obviously we are in very deep trouble. Unemployment of such magnitude is not merely a result of the economic downturn; it tends to be a cause of further decline. For the unemployed are forced out of the market for goods; therefore sales decline sharply. Furthermore, with so many unemployed walking the streets in a vain search for employment, those who do have jobs tend to doubt the future and to curtail purchases for fear that their own jobs may shortly end. So we have an atmosphere of uncertainty building up which depresses all business, and this in turn inevitably leads to more and more distress.
Getting purchasing power into the hands of our unemployed-especially those who are able and anxious to work but are thrown out of employment through no fault of their own-so that they can continue to buy the necessities of life is the best antidote there is for the poison of recession sweeping like a virus through the population of large areas of this country.
TESTIMONY BY CONGRESSMAN EDWARD A. GARMATZ (DEMOCRAT, MARYLAND)
ON PENDING BILLS TO REVISE UNEMPLOYMENT COMPENSATION Mr. Chairman and members of the committee, as one of the sponsors of legislation to expand and liberalize the unemployment compensation law, I urge prompt action by this committee on the Forand bill, H. R. 9430, which 81 of us in the House have joined in introducing, and also on other legislation before you to extend unemployment compensation coverage to Federal employees.
I appreciate very much the support voiced by the Department of Labor officials at your hearings earlier in behalf of covering Government employees into the program. The Chairman of the Civil Service Commission also made an impressive and convincing statement on this matter.
In the Baltimore area, the arbitrary slashing of many Federal Government functions resulted in heavy reductions in force during the past year, and those people-many of whom had devoted years of service to the Federal Governmenthad absolutely no cushion to fall back on, such as is provided other workers by unemployment compensation.
While I know it is not an attempt to present a sicentific report on this matter for all separated Government employees, some facts put forward by Under Secretary of Labor, Arthur Larson, on the experience of separated Labor Department employees, struck me as being extremely significant.
He reported that after 3 or 4 months from the time of leaving their Government jobs, 3 out of every 10 were out of work and looking for jobs; more than 3 out of every 10 had been jobless for 3 months or more, and 4 out of 10 had been jobless for from 1 to 3 months; most of those finding jobs had to take pay cuts-a third of them took cuts of more than $1,000 a year; close to one-half of the reemployed had to take temporary jobs; women found it more difficult than men, and those 45 or over, were having an extremely difficult time finding employment. Furthermore, the accrued annual leave of these people-vacation pay they had not used up before leaving the Government-was adequate to cover the period of unemployment of only one-third of the separated workers.
Those statistiòs show how cruel and heartless it is for the Government to go out into the country and recruit people for Government work, urge them to take less essential jobs in order to serve their Government, and then throw them out with no rights to unemployment compensation.
What we are doing to these Government employees—and the Civil Service Commission chairman presented this very well—is forcing them to go without vacations they are entitled to and need, in order to pile up annual leave as a cushion against appropriation cuts or executive changes which lead to reductions in force. We are permeating the whole Federal Establishment with a feeling of insecuritv and fear. How can you get the best work out of people in that kind of situation?
THE FORAND BILL On the broader question of improved unemployment compensation for workers in private enterprise, I want to say that the present levels of benefits are unrealistic and out of date. Prompt action is necessary, because, despite the reassuring words from some Government officials that things will eventually “pick up,” the fact is that they are still getting worse.
For instance, the latest figures on insured unemployment in Baltimore show that we have twice as many unemployed in our city alone, as the whole State of Maryland had a year ago. This refers only to those unemployed who come under the unemployment compensation system. And one of the frightening aspects of this is that almost 10 percent of those in Baltimore have used up entirely their unemployment compensation benefits.
Last June, in all of Maryland, there were 10,000 unemployed coming under the unemployment insurance program. Figures I have obtained from the Labor Department show for the most recent period, 20,500 in Baltimore alone. In the State, the total is now up to nearly 34,000. 'And about 10 percent of those, too, have used up all their benefits.
So this is obviously a serious matter. It shows that we absolutely must extend the period of coverage from the present maximum of 26 weeks to 39 weeks, as provided for in the Forand bill. That is not to say that this will solve the basic problem of unemployment. Of course, it will not. The only real solution is to get busy and restore the conditions in this country economically which will bring about full employment. We have the word of many outstanding economists, including Sumner Schlichter of Harvard, who is certainly no New Dealer, that the administration has not been meeting this challenge effectively,
The Chairman of the President's Council of Economic Advisers, Dr. Arthur Burns, while outlining no specific program of attack on the recession, nevertheless does concede that the present level of unemployment is, as he put it at his press conference, “intolerable.”
This committee has limited jurisdiction on the type of measures it can recommend at this time which would serve as an effective attack on recession, but in this one matter of unemployment compensation, you have a real opportunity to start the congressional ball rolling to improve the situation.
You have the assurance from President Eisenhower that he thinks the State unemployment compensation benefits should be increased to provide weekly benefits up to one-half the regular weekly pay of an unemployed worker, up to a maximum of two-thirds of a State's average weekly wage. That is exactly what he asked the States to provide in his appeal to them some months ago.
None of the States acted on his request. Now the time has come, I believe, when we must take action on a national basis. This bill carries out exactly what the President recommended on improvement of unemployment compensation. I'm sure he was sincere in suggesting these improvements; therefore, I think we should go ahead and enact the kind of program he has told the States they should have.
In the case of Maryland, the Forand bill would mean maximum weekly benefits of about $41 instead of the present maximum of $30. No family can live on $30 a week. Few can manage today on $41, but $11 a week makes a whole lot of difference to a family which is otherwise without income.
I have devoted most of my testimony to the situation in Baltimore. As I told the House in March, when a city like Baltimore, with its tremendous diversification of industry and variety of employment opportunities, is experiencing a labor surplus-widespread unemployment, then the situation elsewhere in the country must be really grave. As I understand it, there is no longer a single labor market area in the Nation classified as a group I (short labor supply) area, while most of the major areas of the Nation are now in the surplus category. That means skilled workers walking the streets, haunting the employment offices and hiring halls, getting no encouragement and finding no suitable employment.
Many of us had hoped we had reached the level of economic understanding and initiative in the United States that we could avoid this kind of thing. The Employment Act of 1946 was supposed to lay the groundwork for maintaining maximum employment.
Somewhere along the line in the past year, we have digressed from the path of full employment thinking and we have been getting into economic trouble. Re
the rchasing power of our people is the first essential step to getting back on the right path. Providing decent minimum unemployment compensation benefits is an absolute must in that regard.
TESTIMONY BY CONGRESSMAN WILLIAM T. GRANAHAN, DEMOCRAT, OF PENN
SYLVANIA, ON PENDING BILLS TO AMEND THE UNEMPLOYMENT COMPENSATION Law- BETTER UNEMPLOYMENT COMPENSATION
Mr. Chairman and members of the committee, I want to join in urging the approval of this committee of the principles contained in the Forand bill, H. R. 9430, of which I am a cosponsor, to increase unemployment compensation benefits approximately 50 percent and extend the period of benefits to a maximum of 39 weeks.
In addition, I earnestly support other bills before you which would extend unemployment compensation to Federal, State, and local government employees. In Philadelphia, we are particularly aware of the desperate plight of many of the men who have been dismissed from the Navy Yard and from other Federal installations at a time of high unemployment generally, who have had serious difficulty in finding other work, and who have been ineligible for unemployment compensation.
Many of these people were recruited into Government work on the basis of patriotic appeal at a time of labor scarcity. They were told they were needed to help their country's defense effort. Jobs were plentiful in those days, and the decision to take Government employment was, as I said, motivated largely by patriotism.
It is ironic and unfortunate that the Government thereupon dispensed with their services and threw them into the labor market at the worst possible time, when competition for available obs has been severe. But unlike other wage earners who lost their jobs in this period, these Government employees were not eligible for unemployment compensation and had not even the compensation checks to fall back on when their jobs came to an end. They were just cast adrift as you would throw out a wornout pair of shoes.
Therefore, I strongly urge that you take into consideration the valued service these workers have performed and cover them into the program at this time. It is a step which is long overdue, but one which we had some excuse for not having taken earlier while the Government's activities and payrolls were expanding rather than contracting as they are now. Beginning more than a year ago when the new administration began its wholesale firing of Government workers and its elimination of whole agencies and functions of Government, it should have acted promptly to meet the moral obligation to our Government employees to provide this kind of economic protection.
I venture to say that unless we take that step promptly, and include Government employees under unemployment compensation, it will seriously undermine any future attempt the Government might have to make in time of emergency to talk people into leaving other jobs and taking Government jobs. We have seen too often the spectacle of conscientious Government workers abused and condemned for doing their work well; we have seen the sense of security go out of Government career service; we are seeing now that they almost alone among American wage earners do not even have this minimum protection of unemployment compensation.
As to the Forand bill to liberalize the existing unemployment compensation law, it would mean in Pennsylvania an increase in the maximum benefits from the present $30 a week to about $44 on the basis of present statistics on average weekly wages. In other words, with an average weekly wage of $66.08 in Pennsylvania (the figure cited by Secretary of Labor Mitchell earlier this year in his report to the States on this matter), a worker would be eligible to receive a weekly compensation check of as much as one-half his regular pay, up to a maximum of two-thirds of the State average wage—in this case up to two-thirds of $66.08.