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Washington, DC. The subcommittee met at 10:33 a.m., in room SD-192, Dirksen Senate Office Building, Hon. Tom Harkin (chairman) presiding.

Present: Senators Harkin, Burdick, Bumpers, Specter, Hatfield, and Gorton.









Senator HARKIN. Good morning, the Subcommittee on Labor, Health, Human Services, and Education, and Related Agencies will come to order. This morning we have the great pleasure to hear from our new Secretary of Labor, my former colleague in the House, Secretary Lynn Martin, the 21st Secretary of the U.S. Department of Labor.

Secretary Martin, I note that your nomination was confirmed last month by the Senate unanimously. And you obviously start your job with a great deal of goodwill. As a member of both the Appropriations and Authorizing Committees with jurisdiction over Labor Department programs, I certainly look forward to working with you as we have worked together in the past when we were both colleagues in the other body, as we say. I am sure that I speak for all the members of the subcommittee not only in welcoming you this morning, but also ensuring you of a very positive working relationship throughout the year.


Madam Secretary, the Labor Department has wide ranging responsibilities in the area of unemployment, support, in job training and placement services, workers' safety and health, protection of pension and welfare plans, black lung, and workers compensation. Its regulatory and enforcement activities touch the lives of all Americans. You have assumed an important job, and we urge you to pursue it with vigor.

Today, I would like to focus attention on what is happening in the American work force with particular emphasis on the urgent problems being created by the economic recession; 1 million people have lost their jobs in the last year, and unemployment is still rising at an accelerating rate. We hope the recession will be over quickly, but in the meantime, we cannot ignore the stark reality of long lines in unemployment offices and desperate people waiting up to 6 weeks to get their unemployment checks.

I might just note, I do not have it here in my remarks, but yesterday I was informed that the unemployment rate in Iowa went up 1 percent last month; 1 percent. For us that is 20 percent, from 4 percent to a little over 5 percent.

You have asked for a $100 million supplemental to speed up the processing of unemployment claims, and I commend you for that. Yet I understand the Labor Department now estimates a shortfall of $201 million. In the upcoming supplemental, we will address the funding need as fully as possible. Our concerns also must go beyond the immediate need to cushion the impact of joblessness. We need to look at the whole picture of worker dislocation, and how our programs can help those facing long-term unemployment.

Unfortunately the President's budget request seeks a retrenchment in worker readjustment assistance at a time when the need is greater than ever. There are an estimated 4.2 million people who have lost their jobs due to plant closings and mass layoffs in the last 5 years, yet only a small fraction are being retrained.

Madam Secretary, there are other long-range problems that are just as real and just as urgent. According to a recent study, “America's Choice: High Skills or Low Wages,” produced by a committee cochaired by former Secretary of Labor, Bill Brock, and Ray Marshall, average weekly earnings in the United States have fallen 12 percent since 1969. One-third of our front line work force is made up of school dropouts.

American employers invest less in worker training than most industrialized societies in the world. And 92 percent of the Nation's workers receive no formal training once they are on the job. This study proclaims that America may have the worst school-to-work transition system of any advanced industrial country resulting in millions of our youth drifting unproductively for years after leaving high school.

An estimated 70 percent of our future work force will not require a college education. And failure to address the needs of these workers could severely damage our Nation's competitiveness in world markets. The study warns that unless we take action and become a nation of high skills, we risk further declines in wages for the majority of our workers.

Madam Secretary, I know you are concerned, as we all are, about these problems. This morning's hearing will permit us to discuss

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these problems and also to hear about your Department's funding requirements for fiscal year 1992.


Before we get into that, I would yield to the ranking member of the subcommittee, Senator Specter of Pennsylvania and other members of the subcommittee for any opening statement that they may wish to make.

[The statement follows:]

STATEMENT OF SENATOR BROCK ADAMS I would like to welcome Secretary Martin. It's a pleasure to have you with us today. I regret that I must raise an issue with you that you have inherited.

As a Chair of the Subcommittee on Aging of the Labor and Human Resources Committee, I am very disturbed by the substantial funding cuts in the employment programs for older Americans which President Bush's budget proposes.

The President's budget calls for a more than 12 percent reduction in the Senior Community Service Employment Program (SCSEP) which is authorized by Title V of the Older Americans Act (OAA). This is the only OAA program categorically for low-income seniors.

For fiscal year 1991, Congress appropriated $390.36 million for the program, and the Administration proposes to reduce the funding to $342.814 million in fiscal year 1992. This would mean 7,805 fewer positions in the program nationally, from 64,405 jobs to 56,600. The State of Washington, my home state, will lose 131 positions (from 926 positions in program year 1991 to 795 positions in program year 1992). The notion of a “kinder and gentler nation” rings hollow when a program which provides part-time job opportunities for low-income individuals aged 55 and older is slated for such a substantial cut. The program currently provides employment for only about 1 percent of eligible low-income individuals. Why would we want to reduce that even further?

The proposed funding cut follows a recent reduction of 525 job slots (from 64,930 to 64,405) due to the increase in the Federal minimum wage in April 1991.

The Senior Community Service Employment Program is a very visible and successful program of the OAA. It authorizes enrollees to work in a wide array of community service jobs benefiting the general community. These jobs include social, health, welfare, and educational services.

A recent study supported by Families USA shows that the Senior Employment Program is vital to income security and the well-being of minority and low-income elders. The study, Part-time Employment for the Lower Income Elderly, provides strong support for the Title V program. The study concludes that the elders who seek employment through the Title V program are persons wh retirement incomes alone are not sufficient to lift them above the poverty threshold. Not only do the Title V jobs provide a crucial supplement to limited income for older individuals, but they also provide a crucial means to remain socially connected. For lowincome elders, both economic and social needs are partially met through Title V employment.

I am also disturbed by the lack of funding for another program which assists older Americans. That is the Job Training Partnership Act (JTPĂ). Older workers55 years and older-are eligible for training under Title IIA and Title III of the JTPA. According to the President's budget, the block grants authorized by Title II are maintained at $1,744.808 million. Consequently, no increases for cost of living were made for 1992. Although the President's budget proposes an increase of $12.385 million (from $514.601 million for fiscal year 1991 to $526.986 for fiscal year 1992) for Dislocated Worker Assistance (Title III), this increase will be largely offset if the Trade Act adjustment assistance program for dislocated workers is repealed as President Bush also proposes.

These proposed cuts in the programs which affect older Americans come at a time when our country is in a recession and many companies are downsizing and laying off workers. The Office of Management and Budget forecasts that in 1992 unemployment will linger as high as 6.6 percent. Unfortunately, older workers whose employment has been terminated face barriers to re-entry into the workforce that younger workers do not face. Because of age discrimination, many older workers suffer long periods of unemployment or never find another job. The hard economic times for

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our country together with the practice of age discrimination portend very dismal employment opportunities for persons 55 years and older.

I would hope we reject these callous and ill-advised reductions. Secretary Martin, I look forward to working with you and hope the Administration will reconsider these proposed reductions.


Senator SPECTER. Madam Secretary, I join my colleague, Chairman Harkin, in welcoming you to your first testimony before this appropriations subcommittee. I compliment you on your outstanding career in public service and on your confirmation by the Senate for this important job, and very much look forward to working

with you.

The position of Secretary of Labor is always an important one, but I think never more important than in 1991. We are faced with a recession and faced with budget curtailments at many levels, and more than ever the need for self-help and employment opportunity in America so that people may care for themselves. The budget in this past decade, now my 11th year in the Senate, has been reduced very materially. And at a time of economic recession, there are an enormous amount of problems which grip the country and they are certainly evident in my stay.

At the top of the list are the problems relating to job training and the necessity for bringing the hard-core unemployed into employment. I have discussed this with you privately, and hope to work with you both on the record and off the record on many issues. But as I say, at the top of my list is the issue of job training.

I was surprised, really shocked, a few years ago to see a headline in the Philadelphia Inquirer that Philadelphia was a labor shortage area in light of the fact that there are 300,000 unemployed people in the city. It is the need for job training-not just training for those people who are the easiest to train, but to provide training to the hard-core unemployed to solve the problem of labor shortages. And I believe it is a matter which requires leadership by Government with a heavy participation by the private sector.

In my judgment, from what I have seen after talking to many, many people and viewing the situation at many levels, there is a vital self-interest on the part of business America, corporate America, small business America, to provide job training, to find people to take care of important jobs. But it requires more participation by Government to provide the leadership and coordination. That is why I am hopeful that on these issues, where we have had some real national leadership by you and by Vice President Quayle, that we can get these flags of leadership flown and encourage people to undertake this line of activity.

And it is especially troublesome now with the recession, but I think the signs are hopeful with the end of the war, energy prices, oil prices are coming down, are down now. And I think we see sunshine fairly close, now, at the end of the tunnel.

There are many important issues that will be confronting you. The issue of mine safety is a very important one in Pennsylvania, the black lung claims, adjudication and administration issue, unemployment insurance administration, the Job Corps, the fairness of the National Labor Relation Board hearings, are all issues which

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