By the same token, some of those industries that don't require a great deal of machinery might be induced to go to other places. We find in the unemployment period that some of the younger peo ple are thrown out of work because they don't have very much seniority. As to the automobile manufacturing there and electrical workers, we found by reason of automation some of those people get out of the labor market, but I would be glad to have an analysis done by our division of employment security and forward it to this committee. Mr. CURTIS. I think it would be very helpful. (Information referred to follows:) Estimated present and potential coverage of New Jersey unemployment Number of Number of jobs Presently covered (firms employing 4 or more workers). 56, 400 Not presently covered (firms employing 1 to 3 workers). 50,000 1,554,000 100,000 Other establishments not presently covered (including Government and nonprofit institutions, but excluding agricultural and domestic workers) ... – 1 Data not available. Source: Bureau of Research and Statistics, Division of Employment Security, New Jersey Department of Labor and Industry. Estimated distribution of total New Jersey unemployment, by marital status, Estimated distribution of total New Jersey unemployment, by age group, January 1959 Age group: Under 25. 25 to 44.. 45 and over.. Total unemployment------ Number 61, 000 91, 000 69,000 221,000 Source: Bureau of Research and Statistics Division of Employment Security, New Jersey Department of Labor and Industry. Estimated distribution of total New Jersey unemployment, by occupational category, January 1959 SOURCE: Bureau of Research and Statistics, Division of Employment Security, New Jersey Department of Labor and Industry. Mr. CURTIS. Here is one particular area where I am going to direct your attention and I think it becomes particularly important. One aspect of who the unemployed are would be the average wages of those who are unemployed. What estimates I have seen on a national basis indicate that by and large the bulk of the present unemployed are among the unskilled workers and those in the lower wage scales. If that is so, and there seems to be a lot of evidence to indicate it, if we attempted to apply a State average or a national average at the Federal level, we direct that the States have to apply such average to those who are unemployed with the bulk of them in the lower wage groups and below the average. We could very easily exceed the 50 percent of the individual's wages. In fact, there are occasions, and we have already received testimony from some of the specific industries, that that is exactly what would happen to them in their States. I am not at all sure, if we examined the unemployed now and applied that standard to them, whether they are getting 50 percent of their wages. Maybe the States have been doing all right. I don't know. However, I think it is important to know. Otherwise, we can get into these situations. Suppose a person were getting 70, not 50 percent. The incentive to get back into the labor force would be materially cut down. That is why I think we should try to strike at something like 50 percent in our conversations. Mr. MEYNER. It does seem to me you could certainly write in a bill provisions that would recognize the difference of average wages as between the States if you applied the standard. Mr. CURTIS. The way the Machrowicz bill is, it does do that, but even taking New Jersey, you could get an average wage for New Jersey, but if it were true that the bulk of your unemployed are from the lower unskilled groups, that 50 percent average for the State would be considerably higher for the unemployed whom you are administering. Mr. MEYNER. We have that situation right now in New Jersey. It is two-thirds, up to $35. If some person is employed at a resort, and we have a heavy resort industry, is in a cannery, or perhaps in some of the needle trades, where they are seasonal, sometimes they get twothirds of what they were earning because their wage is so low and two-thirds is under $35. They get two-thirds of their wages, but yet, with respect to the skilled person who gets out of work and might be earning $150 a week and has a family setup, and he is buying a home and has all of the necessities, all he gets is the $35. Mr. CURTIS. Yes. That is the danger, Governor, at which I am disturbed, of applying Federal standards and one reason why, it seems to me, the States, because this is a tailoring job to some degree, can do a better job of meeting this discrepancy. If we impose at the Federal level a broad standard of this nature, we could easily be freezing the States action so that you could not do anything about those in the low-wage level, that you would have to pay them automatically what might run up into as much as 70 percent of their wages. Mr. MEYNER. I think you can guard against that by appropriate legislation. Mr. CURTIS. You mean you would have to change the language of our present bills, I believe, if we were to protect against that? Mr. MEYNER. You only set the minimums. Mr. CURTIS. Our minimum is 50 percent in the bill. I am referring to actual proposed legislation. As I understand the bills, they are set at about 50 percent of the wage average, so we would have to do something about that. One other thing, to get into another area. I do not understand your reasoning as to why you believe the Federal Government should be the one to tell the States that they should go to cover employers of four or under. States have done that on their own initiative, and to me a minimum standard is not an absolute standard. It allows some leeway or some flexibility. New Jersey, if they thought it was wise, could extend, as many States have, to employers of one or more. Why is not the Federal minimum of four pretty good, leaving some way to your State to go further if you want? Mr. MEYNER. Because we have a partisan geographical situation in our legislature. We have a situation where we have 13 Republican senators representing about 2 million people, and we had 8 Democrats representing 3 million people. We can get the bill past the assembly but we can't get it past the senate. I don't say it is a partisan issue, because it may very well be that if you change the political complexion, they would react the same. We have one center for each county. Some counties have 35,000, some have 900,000, and I think that happens in most States. You, the Congressmen, speak for the people and very frequently the State legislators speak for acres. Mr. CURTIS. Now we get into a very, very fundamental issue, and it is not just in regard to this Federal standard. It gets into others. As I interpret it, in effect what you are asking us to do in this area is to solve one of the problems that your State and other States have in this question of reapportionment. Mr. MEYNER. I must confess that is true, because we can't get responsibility; and it seems to me when you have a serious social problem, you should try to get it answered under the processes available to you. Mr. CURTIS. That is all right. I just want to see where our area of disagreement is, because I think it really does exist. It strikes me that inasmuch as the States have within their own power the opportunity of solving the reapportionment problem, it is a very dangerous thing, in my judgment at any rate, to go to the Federal Government to try to solve specific problems that cannot be solved at the State level because the State has not grappled with the basic problem, which is reapportionment. In other words, we get down to our concept of representative government of State and Federal, and granted that there is a social problem here, and there certainly is, and we are all interested I think in trying to solve it in the best way possible for the long run, I question whether the way to solve these things is piecemeal where the reapportionment is a real problem by coming to the Federal Government, because I think more damage can result. This business of four or under is a typical example. I do not happen to think, at least from the evidence I have received, that this is really an acute problem. I do not believe unemployment statistics will show that you have very many unemployed among employers of four or under. You have there a different relationship between an employer and employee. When a man employs one or two people, he is usually in a very close relationship with his employees and there are what we might term "intangible fringe benefits." A human relationship and concern exists in those kinds of small groups. Furthermore, the employers of four and under generally are in the service field and retail field, not in manufacturing and not in some of these other kinds of employment. I think we need some more information. My conclusions as to the status of employees of four or under, as to whether or not they do make up a serious problem of unemployment may not be true, but at least we have been unable to get any statistics on it and I have a feeling that we would probably find that the unemployment in that area is not a serious problem. Mr. MEYNER. I would like to join with you in your thinking in that, but I must confess that my administrative experience causes me to come to an opposite conclusion. Many corporations with a large number of employees are sometimes much more solicitious in safety programs, in fringe benefits, than some of the smaller operators. We found that particularly true in safety programs. We found it probably in the experience of our wage collection division. I mean it is a pleasant thought you express and being a man from a small town I like the idea, but I am afraid I can't get the facts to support your conclusion. Mr. CURTIS. I think this: That if we examined, we would find that in groups of four or less it is frequently a question of who is the boss and who is the employee. The relationship is that close when you are dealing with employers of four or less. A very close relationship exists as a general rule. Your conclusions may be right, because my experience comes from work I did on the Small Business Committee over a period of years, and general observations, too, and I am the first one to admit to you that mine is a subjective conclusion, too. I have not seen any real study made of this, and until a study is made, I would much prefer to leave it to New Jersey and these other States to go ahead and cover on down to the one or more, rather than have the Federal Government just blanket and say to all the States, "You must do it." Some States have that and it is very interesting. One final observation on it, a strange quirk. I was talking with some of my labor leaders in Missouri about this feature. They said in one way they were not very happy when we extended it from eight to four because it just created a great many more people pressuring the State legislature against improvement of the actual payment standard and length of payments. From that standpoint reducing from four to one would create a great many more people who would be interested at the State legislature level in resisting the problem of extending better standards in the things which are really meaningful, duration and amounts. Some of the States have gone to four down to one and I think maybe they reasoned about this same way. Thank you, Mr. Chairman. The CHAIRMAN. Mr. Machrowicz. Mr. MACROWICZ. Governor, I want to compliment you on a very fine statement and merely refer to a question asked you by the gentleman from Missouri, Mr. Curtis, as to whether or not you had any statistics with regard to whether these unemployed are single or married, and you stated you did not have them available, but you would try to get them. I might say that all through this hearing is cropping up this inference that the majority of the unemployed are not heads of families. I would just like to call to your attention that there are some figures in that respect. In February of this year the University of Michigan Coordinating Committee on Social Welfare Research published a report by the Survey Research Center of the University of Michigan as to the situation on a nationwide level, not only Michigan but nationwide, and its report shows as follows-this is on the nationwide level: Of those unemployed during the 12-month period, that is, the year 1958, 71 percent were heads of families, 14 percent were wives of heads, 12 percent were sons or daughters, and 3 percent were other relatives. There is also another very interesting item in these statistics, namely, that 18 percent of all families in the Nation-that refers to all families, not only workers covered by the unemployment compensation-had 1 or more family members unemployed during the 12month period to October 1958, which indicates that this impact is very wide and hit many families in the Nation. That is all, Mr. Chairman. The CHAIRMAN. Mr. Knox will inquire, Governor Meyner. |