In addition to the $450,000 in special grants, the State agencies were allocated modest increases in counseling and placement workload over 1956 for expansion and improvement of services to older workers.

For example, during fiscal year 1957, it is estimated that State employment services will take 2,246,000 new applications of the jobseekers 45 years of age and over, 18,500 older jobseekers will be given tests; 1,122,100 nonagricultural placements will be made for older jobseekers; and 370,000 counseling interviews will be provided to jobseekers 45 and over. The estimated dollar value of these services is $13,781,000.

As of November 1956, 98 State employment security local offices had a full-time or part-time older worker specialist on duty. It is expected that at least 18 additional offices will establish such positions as soon as State civil-service requirements and procedures can be met, making a total of 116 local office specialists available. It is clear that a significant start has been made on the older worker problem in practically every State and some 116 of the largest local employment offices in the Nation.

As you know, there are a number of State commissions which are active in this field, and many of the studies we have made are serving their purposes as well.

We are continuing the earnings opportunities forums, initiated by the Women's Bureau, particularly for older women. One has just been held in Washington. These have proved to be very effective.

For the future, a number of additional publications are planned, including, in particular, a Job Guide for Older Workers, a Handbook or Guide for Placement Methods, etcetera. Mr. Goodwin will describe further for you the programs of the Bureau of Employment Security, and Mr. Clague the continuing study of performance of older workers, which the Bureau of Labor Statistics will undertake. My Office will continue the coordination of this program, and during the coming year will give a great deal of emphasis to making the country aware of the problem, through a variety of publications.

We anticipate continuing a vigorous program in 1958.

Skills of the work force

In the fiscal years 1956 and 1957, we have had an appropriation of $40,000 for the development of a new program to improve the skills of the Nation's work force.

All of us are aware in a general way of the tremendous-and the growing— demand by industry and Government for competent workers with a high degree of skill at all occupational levels. (This extends to all types of workers-from men and women in the service trades, to the skilled craftsmen, to operators on the production line, to technicians to run and to service today's new machines, to professional men and women.) There are shortages of skilled and professional workers today, and there is no question but that the demand will increase in the future. Some estimates show that some 10 million more workers of all types will be needed in the labor force in 1965 than in 1955, and that a larger proportion must be more highly trained than they are today.

The first thing we had to do was to analyze the problem and determine what the Department could do and should do to help to meet this growing demand for skilled labor and for its better utilization.

As I told you last year, I borrowed one of the Nation's leading training directors from industry, established a departmental committee on the skills of the work force, and they went to work-first, to identify the role of the Department of Labor, and then to plan specific action programs. The staff initiated a number of test projects last year, upon which the program proposed for fiscal 1958 is based.

I want to indicate the conclusions we have reached with reference to the role of the Department of Labor in making sure that the United States in the future has an adequate skilled and versatile work force. There are three major points in this program

1. to find the facts and inform the Nation about the need for trained people;

2. to help people select, prepare for and obtain the right jobs;

3. to promote more adequate training programs throughout the economy. First, let me point out that this is a very broad gage program, to which most of the bureaus of the Department already contribute through long-established activities especially the Bureau of Apprenticeship and Training, the Bureau of Employment Security, the Bureau of Labor Statistics, the Women's Bureau,

and the Bureau of Labor Standards. Other departments of Governmentnotably Health, Education, and Welfare, and the Department of Defense-are concerned with various facets of the problem, as are several committees, such as the President's Committee on the Development of Scientists and Engineers. The maximum use of all facilities and know-how within the Department of Labor has been achieved and the program integrated with the program of other agencies. The effective planning and integration of this program has been accomplished and this will continue. This has been especially evident in the series of publications designed to provide the public with information on the need for improvement of skills.

For example, the booklet, Our Manpower Future-1955-65, calls attention to the decline in the number of young people age 18-24-the depression babies of the 1930's. If we are going to have the people to man industry by 1965, the leaders of industry must realize that they have to do much of their own training and retraining; that they should take another look at their retirement policies, that they must hire women for occupations which they do not usually undertake to say nothing of hiring skilled older workers. This publication has already been effectively used with the President's Committee on the Development of Scientists and Engineers, the Office of Defense Mobilization Committee on Specialized Personnel, and with other Government agencies in demonstrating the long-run manpower problem that the Nation faces. We expect to distribute thousands of copies to the public, and to use every means to see that it reaches leaders of industry. In the next year, we expect to develop similar departmentwide publications calling attention to other facets of the problem of skills. They will be used to stimulate various kinds of action programs.

The Department has an established comprehensive program on occupational guidance the Occupational Outlook Handbook published by the Bureau of Labor Statistics, and the extensive studies undertaken by the several State employment services, through the Bureau of Employment Security, relating to local employment needs and occupational outlook.

To make the public better aware of the Department's valuable research in this field, and to stimulate improved vocational guidance, there has just been issued, under this project, a departmental bibliography of occupational information, Occupational Information for Counselors. This is now being distributed to over 20,000 schools in the United States on the list of the Office of Education. In all of our work in the occupational outlook and guidance field, we are collaborating very closely with the Department of Health, Education, and Welfare. They welcome the work which we are doing in this field. Next year, additional publications of this kind will be issued.

Another program undertaken is in community studies of training needs, designed to stimulate communities to evaluate their own skill requirements, and to provide any necessary new training facilities. Pilot projects have been undertaken this year in five cities, chiefly through the State employment service agencies, financed by grants for occupational studies by the Bureau of Employment Security. The first study to be completed is the community training survey in Phoenix and Tucson, Ariz., undertaken as a cooperative project by the Arizona State Employment Service, with the participation of the labor, State, and local government agencies, and the Federal Government and military installations located in Arizona. Using a study outline developed by the skills of the work force staff and our personnel inventory called How Do You Stand?, they have surveyed their present manpower requirements and estimated future requirements 5 years ahead. The results are to be published early in February. Already there are some concrete results in new training programs in the locality. It is planned that the results will also be used in planning changes in the educational programs of the area. The Phoenix-Tucson project will serve as a prototype for activities being extended to other communities-as for example, in Bridgeport, Conn. This is part of the continuing program of communitydevelopment work conducted by the State employment services to make their placement activities more effective. We expect that 6 to 8 new studies will be initiated in the current fiscal year, and a larger number in 1958.

The most obvious gap, as the staff analyzed the Department's program, was in the training field. The Department of Labor's work in the past has been confined largely to the apprenticeable occupations-with about 180,000 registered apprentices in training, and about an average of 25,000 graduates a year for the past several years. This work is of very great priority and not enough has been done. Apprenticeship is, and properly, centered largely in the crafts, which is a vitally important though small part of our total work force.

Accordingly, I am recommending the establishment of a new Training ServiceCoordinated with the Apprenticeship Service-under 1 Director for the 2 Services. To accomplish this I have taken steps to begin the establishment of a Bureau of Apprenticeship and Training. It is for this purpose that the increase of $298,000 (exclusive of retirement contributions and other fixed charges) is requested for fiscal 1958. It is designed to carry out a program of stimulation for effective training programs in all industrial occupations. Attention will first be given to identifying training information and services in occupations such as those in manufacturing operations, and for engineering aids, technicians, supervisory and clerical personnel.

Let me elaborate a bit, since this last function constitutes an important part of the first year's new activity.

It has been found, by interviewing training directors in industry, that there is no systematic collection of training materials, so training directors "shop around," lose a lot of time, and duplicate each other's work. Small firms often don't have training directors and cannot afford to do this, so many of them do not have training courses. For example, in a survey of future manpower requirements and training needs for skilled occupations in the metal trades in St. Louis, conducted for the State employment service under this general program, it was found that although 80 percent of the firms reported difficulty in recruiting qualified skilled workers, and even recognized that some of their own employees badly needed more training, nearly one-half had no training program of any kind. Pirating or haphazard training results, yet there is a great deal of good training material in existence, but it is scattered and not generally either well known or available.

We began assembling available materials-first those developed by the Department of Defense, which has represented in its employ practically every occupation in the country. Nearly 1,000 of these courses have been analyzed and cataloged, and this is only a beginning. We have an illustrative collection, listing about 100 Department of Defense courses. Wherever this small catalog has been shown to industry, everyone has been enthusiastic about the idea both of having a listing such as this, and being able to get their hands on the volumes themselves. With good organization and a small additional investment in this new Service I am proposing, the Nation can get a vast amount of use out of this investment. Training courses from private industry and from labor unions-already offeredwill be used, and commercially available materials will also be listed. Our function will be to locate, assemble, and advertise these materials.

During the remainder of the current fiscal year a few of these training materials centers will be put into operation, using local facilities and the staff of interested local organizations to maintain the collections.

It is a new approach to the problem, and, I think, a very promising one. We will only get the work force trained for new techniques and new processes fast enough to meet industry's needs if hundreds of thousands of firms realize that they must do some of their own training and do it by modern training methods. I also want to make clear some of the things that we do not propose to do in this Training Service. The Department of Labor is not going to do any training itself. This is the job of industry and of educators. I think our functions are (1) to indicate the needs for training-not only nationally, by kinds of skills, but specifically, with local cooperation, in particular areas; (2) to stimulate business and industry to analyze their own special and individual personal needs, currently and in the future, in the expectation that they will do something about it; and (3) where necessary and within available resources, to provide technical assistance, training aids, and materials to industry.

A major phase of this program is promotional. We need to wake people up to the seriousness of the shortage of well-trained manpower, and to stimulate individual firms and communities to do something about it.

In planning this expanded operating program for developing and improving the skills of the entire work force of the Nation, I have enlarged the Bureau of Apprenticeship to include this function. I feel very strongly that this kind of program will further strengthen the national apprenticeship program which, as you know, has been in operation for many years. It will also provide assistance to management, labor, the States, and other Government agencies with information and service concerning all occupations, including apprenticeable trades. This departmentwide program will continue to receive specific direction and coordination by the Assistant Secretary for Manpower and Employment.

OTHER AREAS OF EMPHASIS IN 1957

In 1957 we have been concentrating on the following aspects of our program: (a) Planning and developing programs designed to insure maximum utilization of the Department's activities essential to civil defense and mobilization emergencies.

(b) Initiating our role in the highway construction program legislation enacted by the last session of Congress.

(c) Developing plans to decentralize benefit-payment operations for injured Federal workers as close as possible to areas of Federal worker concentration in order to afford better and faster service to employees.

(d) Continued impovement in unemployment insurance benefit payment processing; in extending annual worker plans for migrant agricultural workers; improving employment service to older workers in addition to youth, handicapped, and other hard-to-place job seekers.

(e) Improvement of our economic and statistical program in order to provide more and better data for development of public policy and programs for our national economic welfare.

(f) Initiation of a review of our wage-enforcement program with the view of maximizing compliance with the same or less funds.

(g) Improvement of the analysis and use of information reported by labor attachés and improvement of domestic understanding of the ILO. I believe we will end this fiscal year with employment and purchasing power— which are among the most important factors in the economy-at alltime highs. They have made healthy gains. The employment increases have been for the production of consumer goods and services and for the expansion of our industrial capacity, in both cases to meet the demands of a rising population and a rising level of living.

ANALYSIS OF BUDGET REQUEST FOR 1958

General fiscal analysis

The total of our request for 1958 is $435,440,400. However, this sum, I understand, for appropriating purposes is reduced by the following amounts:

Employees compensation fund

Public roads wage-determination costs_

Vocational rehabilitation, Bureau of Employees' Compensation___

$50, 350, 000 365,000 47,400

Making total deductions of__

50,762, 400

leaving a total of $384,678,000, the same amount as appears in the committee print. Of this amount, $1,978,745 is for the Department's contribution to the employees' retirement fund required by legislation enacted during the last session of Congress.

Of this total request of $384,678,000, an amount of $74 million is for unemployment-compensation benefits to either Korean veterans or Federal workers, and $270 million is for grants to States for administration cost of the State employment-security systems. This leaves a total of $40,678,000 for all expenses of the Department's program responsibilities.

One other overall observation I would like to make is: $276,382,000 of our total request is offset under the Reed bill against receipts from the unemployment insurance tax on employers, leaving a total of $108,296,000 chargeable to general revenue of the Treasury, which represents a decrease of approximately $17 million chargeable to general revenue of the Treasury. It is my understanding that the $50,350,000 estimated for the employees' compensation fund in final bookkeeping also gets charged to general revenue.

The specific appropriation increases and decreases proposed for 1958 are shown on a table attached.

HIGHLIGHTS OF SPECIFIC PROGRAM REQUESTS FOR 1958

Child labor and youth employment

We are requesting an increase of $60,700 for the Bureau of Labor Standards to develop and operate a program for improving the application of child-labor standards under current economic and educational situations and to assist in overcoming obstacles to employment of idle out-of-school youth.

Safety

We are requesting $20,000 to conduct the President's Conference on Occupational Safety in 1958.

Migrant labor

Very real progress is being made in the improvement of the working and living conditions of migratory agricultural workers. There are now 12 official State migratory-labor committees, 5 of which were appointed during the past year. To make the work of the President's Committee more effective and to provide more adequately for the assistance requested by the States, an increase of $40,000 for our migratory-labor activities is requested for fiscal 1958.

Atomic energy

The peacetime application of nuclear energy will present many new problems to State labor agencies. If they are to protect the workers from the hazards of radiation they must become familiar with the techniques of detection and control. Inspection staffs must be trained; codes must be developed and applied; employers and workers must be educated in safe work practices. The Department of Labor should be equipped to give assistance to the State agencies in meeting these new responsibilities. To initiate this assistance an additional $20,000 is requested for the employment of two radiation specialists. These two men will not only work with the States but also with the national groups concerned in the development of uniform codes and standards.

Legal activities

For the functions assigned to the Secretary of Labor under the prevailing wage requirements of the Federal-Aid Highway Act of 1956, an increase of $65,000 to the Solicitor's Office is requested for 1958, which would place on an annual basis the supplemental funds provided for 1957 to initiate the program. Other increases for the Solicitor's Office (exclusive of contribution to the retirement fund) totaling $38,650 are requested to cover the estimated requirements for legal services concerned (1) with clarification in the appellate courts of contested points under the Fair Labor Standards and Public Contracts Acts, (2) with third party tort recoveries under the Federal Employees' Compensation Act (which return substantial sums of money to the Federal Government), and (3) with the employment security and Mexican migrant labor programs of the Department.

Reemployment rights

We anticipate increasing responsibilities in 1958 and future years and the workload is expected to increase. This is due to a number of factors. For this reason I am requesting approximately $123,000 for program expansion. The right to reinstatement with their preservice employers is the only general benefit available to ex-servicemen who entered service after January 31, 1955, and are now being released. It seems likely that more will seek to exercise these rights than was the case when they had other alternatives. During recent years provision has been made for protecting job rights of reservists and members of the National Guard who must perform training duty, both in weekly drills and during annual training periods. With the projected buildup in the Ready Reserve during 1958 and subsequent years, we will face increasing problems. In August 1958, the transfer of draftees and enlistees into the Ready Reserve becomes automatic, and there will continue to be substantial numbers of 6-month trainees under the Reserve Forces Act of 1955. There will be a growing job not only in helping reservists perform training duty without jeopardy to their jobs, but also in providing information and assistance to employers and labor organizations in connection with this program.

Employment security

Each year the Department of Labor becomes a more important and integral part of governmental programs for maintaining the strength of our economy and the well-being of our people. In every year since 1949, the employment security system has been given greater responsibilities and has been asked to do more work by the Congress, Federal, and State executive agencies and by public groups interested in the human and economic problems of employment and unemployment.

I have reviewed the objectives and programs of the Bureau of Employment Security and the number of employees available to it to carry out those programs and in my estimation an immediate start should be made to give it the