Mr. LUDLOW. I believe you said that you contemplated under these estimates the establishment of over 100 local offices and State offices? Mr. McNUTT. Yes, sir.

Mr. LUDLOW. As compared with how many War Production Board offices?

Mr. McNUTT. 130.

Mr. LUDLOW. Will it be possible, in the interest of economy-and that is not yet a lost word-for the same personnel, to a certain extent, to perform the work of both services?

Mr. McNUTT. No, sir; I do not think so. We must work in close cooperation with them. And as I told the committee the last time I was here, Mr. Nelson and I sat down and made our agreement that involved some give and take on both sides. We are shifting both organizations in order to have regional offices in the same communities so we may work in perfect cooperation.

Mr. LUDLOw. The elements of the work are so diversified and different, that you cannot have the same personnel to perform those different duties for both organizations?

Mr. McNUTT. That is right.

Mr. JOHNSON of West Virginia. In using your labor for training, and sending them from point to point where they are needed, what sort of arrangement do you have with the unions when you call them?

Mr. McNUTT. As I have said, we have had to work by agreement. We have had to make agreements between labor and management, and we have had very fine cooperation. I wish it were possible for this committee to see what has been done in Baltimore. We have an experimental area there, knowing that Baltimore had practically every one of the manpower problems, with the exception of furnishing agricultural labor. For the last 2 months, they have gone into it. At the outset it looked like an impossible situation, but day before yesterday, when I was over there, they told me that at noon that day all but one employer in the city had signed the agreement. Of course, that one might upset what we are trying to do, but they thought he would sign within 24 hours. By the agreement we have been able to get, they provide for women in that work, and we have been able to remove the discrimination against the employment of minority groups. It has been a fine experiment, and everybody has cooperated.

RECRUITING LABOR FOR MR. KAISER

The CHAIRMAN. With reference to the recruiting of labor, our friend, Mr. Kaiser, who has been so much in the public eye, has recruited 50,000 workers, I believe.

Mr. McNUTT. We did the recruiting.

The CHAIRMAN. But he has paid the transportation expense. Mr. McNUTT. Yes; but the number is not 50,000. There were 4,000 to start with. The objective is 20,000, and he asked us to stop recruiting. I might say to you that there were only 2 percent of rejections of the people we gave them.

The CHAIRMAN. He paid the transportation charges?

Mr. McNUTT. Yes, sir.

The CHAIRMAN. Why can you not follow that example? He is a master of industry.

Mr. McNUTT. He is also operating on a cost-plus contract. The farmer is not operating on a cost-plus-fixed-fee basis, so far as I know.

Mr. TABER. I do not believe I have many questions on the Statements that have been made. I do not know enough about what these estimates are to go into the amounts. Will you go into the details?

The CHAIRMAN. When we get through with the general questions, we will take up the Budget, page by page.

Mr. TABER. I would much prefer to defer my questions until we go into the estimates.

Mr. WIGGLESWORTH. I have no general questions, Mr. Chairman.

UNIVERSAL CONSCRIPTION

Mr. LAMBERTSON. I want to ask a question of Mr. McNutt. I have observed that the Legion conventions that we have had for 20 years have advocated universal conscription, and now we are advocating it here. I have noticed that for 20 years the Legion, while advocating universal conscription, have not gone any further with it, or with that program. Can you state why they have never pushed the program?

Mr. McNUTT. As a matter of fact, there have been several bills introduced throughout those years.

Mr. LAMBERTSON. But introducing bills and having hearings does not accomplish the purpose. That is not putting their power behind the thing. I have never seen any evidence of the Legion pushing legislation here for universal conscription.

Mr. O'NEAL. They have had witnesses here before the committees. Mr. LAMBERTSON. No; but having witnesses in hearings does not mean push and steam behind it.

SALARIES AND EXPENSES, WAR MANPOWER COMMISSION

The CHAIRMAN. If the committee will turn to page 24, you will find a detailed break-down of this amount. The estimate is for $2,213,000. The previous amount provided was $3,114,000, plus $167,052, making a total of $3,281,052. We will have placed in the record pages 24 and 25, which contain a summary of the $2,213,000 in the estimate submitted for appropriation at this time.

(The matter referred to is as follows:)

The CHAIRMAN. I note that you ask for an increase in the Department from 763 employees to 833 employees, or an increase of 70, to be provided out of these funds. For the field, you ask for an increase from 299, your present force, to 1,038, an increase of 739 field employees.

Now, will you give us briefly a statement of the necessity for this increase? For instance, I see that you want two additional employees for the office of the deputy chairman.

Mr. McNUTT. Mr. Altmeyer is in charge of the operations here, and General McSherry has the operations in the field, and I would like to have them answer those questions.

ADDITIONAL EMPLOYEES FOR THE OFFICE OF THE DEPUTY CHAIRMAN

The CHAIRMAN. What is the need for two additional employees in the office of the deputy chairman?

Mr. ALTMEYER. If you will turn to page 2 of the justification, that is where we start describing the necessity for the increases. The CHAIRMAN. Give it to us briefly in your own words.

Mr. ALTMEYER. There are only two additional positions being asked for there. One is an assistant to the chairman, and one is a clerkstenographer at $1,800. The work of the deputy chairman has increased to such an extent that he is unable to carry the present load without having an assistant and one more stenographer.

Mr. McNUTT. The deputy chairman is handling the labor relations. That is a specific assignment, and the work has increased tremendously

The CHAIRMAN. In the Office of the General Counsel, you are asking for four additional employees. Are these four additional employees here lawyers or stenographers?

Mr. ALTMEYER. There are two lawyers and two clerks.

The CHAIRMAN. How many lawyers do you have in this office? Mr. ALTMEYER. There are eight.

The CHAIRMAN. And you are asking for two more?

Mr. ALTMEYER. Yes, sir.

The CHAIRMAN. You are asking for two other employees?

Mr. ALTMEYER. Yes, sir.

The CHAIRMAN. What is the need for these two additional lawyers? Mr. GAVIT. There has been a general expansion of work in the office, and this is due to the considerable amount of additional work that the Commission is proposing to do.

Mr. LUDLOW. What will they be paid?

Mr. GAVIT. I think they are listed at $5,600 and $4,600.

Mr. WIGGLESWORTH. The break-down shows 10 instead of 8.

Mr. GAVIT. Ten would be the total if this is allowed. We have eight now.

ADDITIONAL EMPLOYEES FOR OFFICE OF DIRECTOR OF OPERATIONS

The CHAIRMAN. Your great increase seems to be in the Office of the Director of Operations. In the Office of the Director of Operations you have 24 employees, and you are asking an increase of 18. General MCSHERRY. The duties of the first position listed is that of deputy director, who will supervise the field operations. He would have immediate supervision of 12 regional directors in the field. We are setting up the new division to insure effective utilization of our labor force. We will have in this division, 5 technical men, with the necessary clerical help. The funds for this division are the big part of this particular section of the estimate. In addition, we are setting up a special section to deal with the problems peculiar to women. that section we will have 3 technical people, with the necessary clerical help. In other words, they will deal with problems of recruiting women who have never been in the labor force such as we have had in tight labor market areas of Detroit, Seattle, Baltimore, and similar places.

In

ADDITIONAL FIELD PERSONNEL REQUESTED

LABOR SUPPLY INSPECTORS AND ASSISTANTS FOR REGIONAL OFFICES

'The CHAIRMAN. Referring to the new positions in the field, if the committee will turn to page 5, you will note that they are asking for 12 regional offices, with 12 labor supply inspectors at $6,500 each, and 12 assistants at $5,600 each. These are high-paid employees.

Incidentally, in your regional offices you have a total personnel of 344, and they are costing you $610,160. That is an average salary of about $3,800. Is not that a pretty high average for the number of people in that character of work?

General MCSHERRY. I might say, Mr. Chairman, if we are going to solve the manpower problem it has to be solved at the local level; it cannot be solved in Washington. The problems do not occur in Washington.

If we do not have a field staff to solve them in the localities where they occur, they will never be solved. As Governor McNutt said, we can make the policies in Washington, but they have to be carried out in the field, and we have to have the men to send there.

At the present time we have funds for 25 industrial areas. The War Production Board has or plans to have 130 local offices. We propose to set up 120 local offices and to supplement those in the areas we contemplate having 3 men attached to each region who will be available to handle special problems in areas where at present it does not appear that a full-time office is necessary.

In other words, you might have a farm-labor problem, or miningindustry problem, which might cover a State or larger area. We will have these men attached to the regions to cover those situations.

We have specially difficult problems where the local authorities have to have special help. The men attached to the region will be used for this purpose also.

The CHAIRMAN. What I am asking you about is this. Here you have an organization of 344 people, including everybody from the office boy up to the top men, and you are paying them, all of them in the whole organization, including the clerical force, an average throughout the establishment of $3,800 per annum. That is such a high average I am wondering what class of people you have to justify that high average of salaries which you propose to pay.

General MCSHERRY. Because, Mr. Chairman, this is a highly technical field, requiring the services of highly trained specialists. The clerical help required is much less than would be found in most offices you might use for comparative average salaries. We must thoroughly analyze the problem in thousands of war establishments. We have to deal with the management of the biggest concerns and get them to accept the program. If they do not accept the program of the Commission the manpower problems will not be solved.

These men also have to deal with the labor leaders in the community. Industry will pay a good personnel man anywhere from $10,000 to $50,000 a year. We have to have high class personnel, men who understand employment problems.

Mr. TABER. How big an institution does it have to be where such a man would be paid up to that figure?

General MCSHERRY. A plant of that kind will be one like the Carnegie Steel Co., with 236,000 employees.