Another indeterminate factor having a bearing on housing needs is the extent of demolition and disaster losses in connection with dwelling units.

Furthermore, studies of price and rent levels at which private enterprise is making new housing available should play an important part in the formulation and application of housing policy by the Government as well as providing a means for a fair appraisal and understanding of such policy by the general public. This type of information is not now available.

The responsibilities placed upon the Housing and Home Finance Administrator by H. R. 4009 will require accurate, complete and authoritative information regarding the extent of the housing need and progress being made currently toward meeting such need in the principal areas where slum clearance and low-rent-public-housing assistance is requested by local housing authorities. In order to assess the need, it will be necessary for this information to cover not only the individual municipality requesting the assistance but the entire metropolitan area in which the municipality is a part.

The gaps in information I referred to may be filled in through properly evalu ated field surveys. The information obtained must be related to the total housing needs of particular communities as evidenced by such factors as the vacancy rate, living congestion, the condition of existing housing supply and the rate of new family formation. The production of existing housing must in turn be related to the requirements of local building codes, the character of available financing and building practices. Even where studies designed for the purpose of assembling such information are undertaken locally or by Federal agencies with full use of local facilities, it will be necessary to have technical standards established and Federal supervision supplied by the various Federal agencies. This will be necessary to insure a degree of uniformity essential to the administration of a program reaching into communities throughout the entire land.

As H. R. 4009 recognizes, individual studies and surveys under an expanded statistical program are essential to the most effective operation of a public housing program. I ask, therefore, that you provide adequate financial implementation of the statistical duties set out in title III of H. R. 4009.

PROTECTION OF LABOR STANDARDS

I feel that sections 109 (a) and 207 (f) of H. R. 4009 which pertain to labor standards may give rise to serious difficulties in connection with the maintenance of uniform standards on federally financed construction work. Section 109 (a) provides that wage rates to be paid mechanics and laborers, as well as fees for professional employees on slum-clearance projects financed under the bill, will be not less than the prevailing wage rates or fees, "as determined or adopted (subsequent to a determination under applicable State or local law) by the Administrator." Section 207 (f), amending existing law, makes the same provision respecting low-cost housing projects authorized by the bill. I believe that these provisions represent an unwise deviation from established governmental policy on this subject as set forth in the Davis-Bacon Act (49 Stat. 1011), the Federal Airport Act (60 Stat. 170), certain portions of the National Housing Act (53 Stat. 804), and other related Federal statutes pertaining to construction. The acts referred to provide that contracts pertaining to construction to which the United States is a party, as well as construction contracts financed and insured by Federal funds shall contain a stipulation that not less than the prevailing rate of wages as predetermined by the Secretary of Labor shall be paid mechanics and laborers employed in connection with such contracts. I consider it essential that labor standards protection relating to the expenditure of Federal funds in the manner proposed by H. R. 4009 be based on a predetermination of prevailing wage rates by the Secretary of Labor. Accordingly I recommend that H. R. 4009 be amended as indicated by the proposed amendments which I am attaching.

AMENDMENTS TO H. R. 4009 RECOMMENDED BY THE DEPARTMENT OF LABOR

On page 18, in line 21, strike out the words "wages or fees", and insert in lieu thereof the word "salaries"; and in line 25, preceding the word "technicians" insert the word "and" and after the word "technicians" strike out the comma and the words "laborers, and mechanics".

On page 19, in line 1, after the word "involved" insert the following: "and shall also contain a provision that not less than the wages prevailing in the locality. as predetermined by the Secretary of Labor pursuant to the Davis-Bacon Act

(49 Stat. 1011), shall be paid to all laborers and mechanics employed in the development of the project involved".

On page 19, in line 2, strike out the word "may" and insert the word "shall". On page 46, in line 23 strike out the words "by inserting after" and strike out all of lines 24 and 25 and insert the following: "to read as follows: (2) Any contract for loans, annual contributions, capital grants, sale or lease pursuant to this Act shall contain a provision requiring that not less than the salaries prevailing in the locality, as determined or adopted (subsequent to a determination under applicable State or local law) by the Authority, shall be paid to all architects, technical engineers, draftsmen, and technicians, employed in the development or administration of the low-rent housing or slum-clearance project involved; and shall also contain a provision that not less than the wages prevailing in the locality, as predetermined by the Secretary of Labor pursuant to the Davis-Bacon Act (49 Stat. 1011), shall be paid to all laborers and mechanics employed in the development of the project involved; and the Authority shall require certification as to compliance with the provisions of this paragraph prior to making any payment under such contract.'".

THE SECRETARY OF COMMERCE,
Washington 25, May 7, 1949.

HON. BRENT SPENCE,

Chairman, Committee on Banking and Currency
House of Representatives, Washington, D. C.

DEAR MR. CHAIRMAN. In recent appearances before the Committee on Banking and Currency concerning H. R. 4003, spokesmen for the Housing and Home Finance Agency have made clear the need for an adequate housing program and and for Federal assistance in overcoming existing shortages. As a member agency in the National Housing Council I would like to take this opportunity to point out in general terms, the value of construction, particularly housing construction, to our national economy and to bring to the attention of the committee the assistance which the Department of Commerce may lend the Administrator of Housing and Home Finance Agency under the pending Federal Housing Act of 1949.

Construction activities constitute between 10 and 15 percent of our national economy, and, therefore, entirely apart from the direct effect of inadequate housing on the well-being of the families of our Nation there development must be continued for the prosperity of the Nation. Housing represents the largest single class of construction, consistituting about two-fifths of the Nation's construction activities; and it is essential that private enterprise should be encouraged to serve as large a part of the need as it can, with governmental action lending such assistance to the housing industry as is necessary.

For many years the Department of Commerce has carried on technical and economic research in the general field of construction and construction materials because of the economic significance of construction and the importance of such research in reducing construction costs. The use of the same materials in the housing field and other fields of construction and the necessarily close relationship between desirable building codes for housing and for other construction are examples which emphasize both the need for considering the entire construction industry in securing certain data and the value to housing of studies carried out elsewhere in the construction field.

Within the Department there are three principal bureaus active in the construction field. A large part of these activities is of inestimable value in aiding in the solution of various problems arising in housing. These activties are carried on as a part of the Department's present activities and would be broadened to reflect the concern of the Congress as shown by a specific legislative program. These three bureaus are the Office of Domestic Commerce, the National Bureau of Standards, and the Bureau of the Census.

The Office of Domestic Commerce has, for sometime, made economic studies of the availability and movement of selected construction materials with projections of such figures into the future to assist the builder and consumer. The official Government estimates of construction activities in general, prepared jointly by the Office of Domestic Commerce and the Bureau of Labor Statistics are fundamental items of information on housing necessary in any research program. The programs dealing with construction activities in the Office of Domestic Commerce, expanded in accordance with the importance of housing activities, would be, in our opinion, invaluable as an aid to the Administrator

when integrated into a program such as planned under the proposed legislation, particularly title III.

The National Bureau of Standards has, over the years, carried on considerable research in the construction field. This Federal activity has been prompted by the Nation-wide interest based on the need for safety and economy in this field. The appropriateness of materials, new and old, for construction purposes must be evaluated and this Bureau has done much work along these lines for the Federal Government, a large consumer of building construction, including the Federal Housing Administration and Public Housing Administration in the past.

In addition to the Housing Census of 1940, the Bureau of the Census has, at the request of the Federal housing agencies, taken many local surveys of housing. These surveys provided useful, up-to-date information necessary to the efficient administration of such an agency. The Census Bureau has specialized facilities, physical equipment, and the technical staff required for efficient collection and large scale processing of statistical data. Its use by the Administrator in a manner consistent with the program undertaken would provide essential information and would result in economy and safeguard the quality of the data collected for the program.

Section 507 of the proposed bill would authorize a decennial census of housing. The taking of such a census is part of the program of the President as outlined in his message to the Congress. I am of the opinion that a census of housing under the terms of section 507 would be of special importance to those interested in construction, production of materials for construction, furnishings, and areas of expansion for small business enterprises.

In addition to the activities of the bureaus, the Office of Technical Services received an appropriation of $1,500,000 during fiscal 1946-47 for sponsoring industrial research to foster and promote the Nation's business and industry. The largest expenditure under this program was made in the field of construction research-approximately $500,000. Included among the activities to which grants were made were research concerning Modular Coordination, the Industry's Engineered House, weather resistance of materials, use of brick and tile, analysis of plastering techniques, certain new materials, and basementless homes.

I have attached for the information of the members of the committee a more detailed description of the activities of the Department relating to the housing field-activities which, under a coordinated program such as is envisioned by title III of the proposed bill would, in my opinion, prove of great assistance to the Administrator in attaining the objectives of the bill. I am further of the opinion that the activities authorized under title III constitute a practical way of assisting in the achievement of more efficient home building and thus lower cost to home purchasers. If we are to bring adequate housing within the reach of lower-income families, we must intensify our efforts to reduce costs. I am advised by the Bureau of the Budget that there is no objection to the submission of this report to the Congress for their consideration.

If we can be of further assistance to the committee in this matter, please feel free to call upon us.

Sincerely yours,

WILLIAM SAWYER, Secretary of Commerce.

STATEMENT OF ACTIVITIES OF THE BUREAUS OF THE DEPARTMENT OF COMMERCE ENGAGED IN ACTIVITIES IN HOUSING RESEARCH AND THE TYPE OF ASSISTANCE THEY MAY BE EXPECTED TO RENDER THE ADMINISTRATOR IN HIS CARRYING OUT OF THE HOUSING PROGRAM UNDER H. R. 4009

THE OFFICE OF DOMESTIC COMMERCE

In our opinion, an understanding of the economic forces which underly the housing market is essential in the administration of a housing program such as that provided for in H. R. 4009. These economic forces basically set the cost of housing, determine the type of housing which families of different incomes can enjoy, influence the extent to which existing housing is maintained or permitted to deteriorate, and generally control both the quantity and quality of the housing supply.

Since housing construction makes use of much of the same materials, labor, and methods as other types of construction, a study of housing economics cannot overlook consideration of other types of construction.

Because of the work which the Office of Domestic Commerce is currently doing, and is equipped to do, with respect to construction as a whole, there should be a close working relationship between the Housing Agency and the Office of Domestic Commerce, with the Office of Domestic Commerce called upon for those types of economic and statistical research which can most effectively be carried on as part of the general study of all types of construction. We are certain that the Office of Domestic Commerce can be of invaluable assistance to the Administrator acting under title III of H. R. 4009.

Perhaps the most important activity of the Office of Domestic Commerce for purposes of housing research is the work which we are now doing, and the broader work which we are equipped to do, with respect to a study of the supplyand-demand situation for construction materials. For some time the Office of Dometic Commerce has compiled estimates of the quantities of important materials used in construction. These estimates are currently published twice a year and are not only prepared for past years but are also projected 6 months or a year into the future. They cover the total use of selected materials in construction, including both new construction and maintenance, and include housing as well as all other types of construction. They constitute a fundamental tool in connection with analysis of the supply-demand situation for construction materials, and are equally important for studies of any one type of construction as for over-all analyses, since in either case it is necessary to have the entire picture for all construction on a comparable basis.

For a satisfactory program of housing research, however, the present estimates of material use need substantial improvement if they are to be fully adequate both for research purposes and as a basis for administrative decisions. The present estimates of material use are derived from estimates of the dollar value of construction, by applying factors of material use per dollar of construction of each type. As indicated below, these estimates of the value of construction activity themselves require improvement. In addition, an expanded program for collection of original data for purposes of developing more accurate factors of material use is essential. Several years ago the Office of Domestic Commerce studied about 13,000 construction projects covering nonresidential building of all types, to find out what quantities of materials were used in construction of those projects. Since that study was made, however, the supply situation for many of these materials has altered drastically, and conditions of material shortage are currently giving way to conditions of adequate supply in many cases. Not only has the relative availability of different materials changed but their relative prices have shifted widely. Thus, new and continuing studies of the use of materials per dollar of construction need to be developed—a task to which the Office of Domestic Commerce would be able to bring its recent experience with surveys of this type.

For greatest usefulness, of course, the measures of the consumption of construction materials need to be supplemented by adequate data on the supplies of these items. Original compilation of supply data is a function of the Bureau of the Census rather than of the Office of Domestic Commerce, and is discussed in some detail in connection with the review of the work of that Bureau. The Office of Domestic Commerce, however, has a specific role in connection with information on material supplies which contributed directly to many types of housing analysis. At the present time, available satistics on production, shipments, and stocks of construction materials are assembled by the Office of Domestic Commerce not only from the Bureau of the Census but also from a considerable variety of governmental and private sources which originally compile them. Summary figures are published regularly in our monthly publication, Construction and Construction Materials Industry Report. In addition to the compilation of these summary reports on individual materials, the Office of Domestic Commerce also prepares each month a composite monthly index of production of building materials, to serve as a convenient over-all measure of the new material supply.

There are serious gaps in supply information for many important materials and there is need for more adequate coverage of the principal construction materials if a full understanding of the material situation is to be reached and if administrative action is to have a factual base. The necessity for better production data for individual construction materials is, of course, reflected in the need for better basic information for purposes of the materials production index compiled by the Office of Domestic Commerce. At the present time, this index is based on 20 materials, a list which should be extended if this index is fully to meet the purposes which it designed to serve.

Research in housing economics is also immediately concerned with the volume of construction, not only in housing but in other types of construction as well. At the present time, the official Government estimates of construction activity are prepared by the Office of Domestic Commerce jointly with the Bureau of Labor Statistics.

These estimates of construction activity are of concern to the housing research program in several important respects. The figures on the volume of new residential construction compiled by the Bureau of Labor Statistics and incorporated in the joint construction-activity figures represent one of the fundamental items of information on housing necessary in any research program. The comparison of the housing figures with comparable data for other types of construction—a comparison which the over-all construction activity estimates make possibleis needed to place residential construction in the total. Finally, the figures on construction activity are essential basic data for the estimates of material use mentioned above. Thus, they have manifold importance for housing studies. For this reason, the housing research program should look toward improvement of these data, including the estimates of nonresidential construction of all types as well as the Bureau of Labor Statistics estimates of the volume of residential construction.

One outstanding instance in which improvement of the construction activity estimates is needed is found in the case of private nonresidential building, where the national estimates must be prepared on the basis of somewhat arbitrary ratios applied to figures for the 37 Eastern States, since direct comparable measures of construction are not available for the 11 Western States.

Still another type of study which would prove of great value in the proposed program would be an evaluation of the number and kinds of nonresidential construction required to be located in an area accessible to the residential developments. This type of information would be of great interest not only to those charged with responsibility for the program but also to that section of the small-business community looking for areas of profitable expansion.

THE NATIONAL BUREAU OF STANDARDS

The interest of the Federal Government as a builder and user of constructions such as the Federal Government buildings in Washington, and post offices, prisons, military installations, and the like, and, in recent years, the interest of Federal housing agencies in the economic use of public moneys, and concern with safety require that the Government engage in research, acquire test data, and establish testing methods and standards for judging materials, together and in combination, and for equipment used in such buildings.

The scope and nature of the Government's activities in the field of building technology is significant. The principal agencies engaged in technical work have been the Departments of Commerce and Agriculture. In the Department of Commerce, the National Bureau of Standards has been engaged in research, testing, and development work in physics, chemistry, and engineering since 1901, while the Forest Products Laboratory of the Department of Agriculture has long been concerned with the problems of wood technology.

The bulk of the Government's efforts in building research have been concentrated at the National Bureau of Standards. One of the reasons for this is the nature of the Bureau's functions, facilities, and staff, which are devoted to problems of research, development, testing, standards, standardization, calibration, codes, and specifications that arise in the physical sciences.

From its establishment in 1901, the National Bureau of Standards has been engaged in building technology. In 1921 the Division of Building and Housing was established at the Bureau by the former President, Herbert Hoover, then Secretary of Commerce, and the work of the Bureau was intensified in this direc tion. In 1935 the Central Housing Committee was formed under the aegis of Mr. Frederic A. Delano, and an advisory committee was formed consisting of representatives from the Veterans' Administration, Home Owners' Loan Corporation, Treasury, Public Health Service, United States Housing Authority, Navy, Bureau of Indian Affairs, Forest Service, Army, and the National Bureau of Standards, which integrated the Federal Government's interest in building technology, aided the National Bureau of Standards in its programs, and sponsored specific projects. During the recent war years the emphasis of the Bureau's building technology activity was on military and emergency construction work, particularly military installations, defense plants, and emergency housing. Immediately after the war the building activities of the Bureau were, after a