for unemployment compensation and employment service administration, unemployment compensation for veterans and unemployment compensation for Federal employees. I shall insert the table showing the combined obligations by objects for the Department. (The material referred to follows:) DEPARTMENT OF LABOR Obligations by objects [Excludes transfers from War Claims, reimbursements, and adjustments relating to advances between years] 1 Includes 124 positions for the District of Columbia Employment Service Center paid from the grants to States appropriation. tion). 2 Excludes $43,600,000 estimate for employees' compensation claims and expenses (indefinite appropriaExcludes $44,700,000 estimate for employees' compensation claims and expenses (indefinite appropriation). Senator HILL. Mr. Secretary, we would be very happy to have you proceed in your own way and make any statement you see fit with reference to this appropriation bill and any particular items, any suggestions you may have to make. PREPARED STATEMENT Secretary MITCHELL. Mr. Chairman and gentlemen, I would like to place in the record a prepared statement which I understand is the pleasure of the committee-and mine, too-that I not read. I would like to, if I may, capsule some of the more important points in this statement. Senator HILL. We would be happy to have the statement appear in full in the record, Mr. Secretary, and you can make any additional statement or comments you see fit. Secretary MITCHELL. Thank you, sir. (The statement referred to follows:) OBJECTIVES OF THE DEPARTMENT OF LABOR The act creating the Department of Labor provides "The purpose of the Department of Labor shall be to foster, promote, and develop the welfare of the wage earners of the United States, to improve their working conditions, and to advance their opportunities for profitable employment." In furthering these general objectives, the programs and policies of the Department of Labor are designed: 1. To aid, through an effective Federal-State employment service system, in getting the best possible job for the worker, and the best possible worker for the job; and, when suitable jobs are not to be had, to insure the availability of a system that provides adequate unemployment compensation with dignity and despatch. 2. To help employees, employers, and the States in making work practices and work places safe and healthy; and, when injury or illness do occur, to aid in the provision of workmen's compensation which will not only prevent hardship to the injured worker and his family, but whenever possible restore him to health and useful employment. 3. To provide a framework within which employers and employees can conduct their affairs and fairly work out their differences with a minimum of Government intervention; but where practices exist that offend American standards of decent wages or hours or working conditions, to blot out these substandard conditions by vigorous enforcement of labor standards legislation. 4. To sponsor training programs and vocational guidance which bring out the best potentialities in individuals of all ages, and which will produce a body of skilled and versatile workers to meet the needs of our expanding economy and of national defense; and to anticipate the demands of a possible mobilization period by manpower planning that, within our traditions of freedom and protection of labor standards, will effectively safeguard the national security. 5. To supply the factual information needed to develop sound judgments and policies on employment, unemployment productivity, wages, hours of work, working conditions, labor relations, work injuries, prices, cost of living, and the like; and to undertake, assist and stimulate economic and social research which promises new knowledge to aid in furthering the well-being of working people. 3. To make provision for the particular needs and opportunities of individuals in special circumstances, such as: Older workers, whose ability to contribute to the economy must be better understood; women, whose skills are vital to the Nation's labor force; young workers, who require both added protection from damaging work surroundings and also special guidance and training; handicapped workers, whose capabilities, properly analyzed and developed, can be a valuable resource to themselves and to the country; minority groups, who possess great untapped resources of talent and strength that must not be wasted through discriminatory rules, attitudes or practices; and veterans, who, through special placement efforts and guarding of reemployment rights, may be assisted to regain their competitive position in the labor market without undergoing a penalty because of the interruption of their careers by military service. 7. To promote public and private programs which, as a means of improving international harmony, will help the workers of this country and other countries to a better understanding of each other's attitudes, aspirations, and institutions. STATEMENT OF THE SECRETARY OF LABOR The appropriation being requested by the Department of Labor is for the purpose of carrying out programs developed as a result of public law which have as their objective the conservation, protection and development of our human resources, the wage earners of the Nation and their families. You are aware of these programs which have been in existence for years: employment service, including the veterans' service; apprenticeship training; unemployment insurance, including such insurance for veterans; workmen's compensation for Federal employees; reemployment services to veterans; labor standards; minimum wage and overtime; international labor; services for women wage earners. These are the major pro gram areas. Because of the growth in our population and increased workload and the general desire to provide more adequately for our wage earners, relatively small increases are being requested to provide expanded and more adequate programs. Programs for which increases are requested include: Employment service and unemployment insurance (grants to States); unemployment insurance for veterans and Federal employees; employment and unemployment statistics; Federal employees' compensation; workmen's compensation standards; veterans' reemployment rights; apprenticeship training; and minimum wage and overtime. New programs for which funds are requested: developing a program which will point the way to increasing jobs for older workers through eliminating discrimination against employment of this age group; developing manpower mobilization and civil-defense plans and programs as requested by the Director of the Office of Defense Mobilization and the Federal Civil Defense Administrator. This budget request does not provide for new or expanded programs to carry out legislation which the Congress may pass this year such as those relating to Federal fair labor standards, industrial safety, and those relating to Federal employees' compensation. The amounts requested for current programs might have been greater had careful attention not been given to improving the management and administration of the Department's programs. Shortly after I took office, I initiated a project to evaluate the Department's program and organization. This evaluation was done by the staff and a group of outside consultants. The evaluation resulted in clarifying objectives providing new program emphasis and strengthening departmental administration, supervision and direction. WHERE THE DOLLARS GO The total amount of the estimate for 1956 is $514,816,000 and is allocated as follows: Federal employee compensation benefit payments... Total.... Percent 9 29 7 49 6 100 You can see that the first 3 items amounting to 45 percent of the total dollars are not subject to administrative control, but are for benefit payments, and that 49 percent is paid out to the States for administering the employment security program. That leaves only 6 percent of the total under Federal administrative control. MANPOWER MOBILIZATION AND THE OLDER WORKER I am requesting a new appropriation of $473,000 for the Office of the Secretary. This is to enable the Department to carry out delegated responsibilities from the Office of Defense Mobilization and Federal Civil Defense Administration and to initiate a project directed toward eliminating employment problems of the older worker. It is only of recent date that the continental United States has been in any real danger of physical attack. The long-range bomber and the atom bomb are responsible for this change. The United States must deter any prospective aggressor by being able to effectively retaliate. This means that skilled, scientific and engineering manpower must be developed to conceive, design, and produce effective weapons and to generally keep United States defense capability up to date. In case of full mobilization or attack on the United States, realistic, practical manpower mobilization plans must be ready to provide the manpower for the rehabilitation of living facilities, and of plant and equipment, and for the production of military and civilian goods and services. In addition to the Department of Labor's statutory responsibility in the manpower field, the Director of the Office of Defense Mobilization has delegated to the Secretary of Labor responsibility for manpower mobilization planning. The Federal Civil Defense Administrator has delegated responsibility to the Secretary for planning manpower programs to meet the civil-defense emergency and for programs to maintain income of the unemployed and those injured in line of civil-defense duty. An extremely vexing and important problem is the failure of employment practices to adjust to profound population changes. Since 1900, the total population has doubled, but the number of people in the age bracket of 65 and over has quadrupled and those in the 45 to 64 group tripled. Life expectancy has increased while work-life expectancy has decreased. About 33 million people are in the 45 and over population. Population trends will aggravate this problem and will result in a declining rate of labor force participation by these age groups. The Department is deeply concerned about this problem and believes that a long-range employer educational program is necessary to bring about a fundamental change in attitude concerning the worker of 45 and over. The specific explanation of the need for these programs and the Department's proposal for carrying them out will be explained when you take up this particular item. OFFICE OF THE SOLICITOR The wide variety of legal activities of the Office of the Solicitor continues to be carried on efficiently and effectively. The increase here of $50,000 is related to: (1) the employment security program, because of new legislation in this field; (2) the wage-determination program, particularly in the coordination of enforcement of the labor standards provisions of the various statutes relating to Federal construction, and the improvement of wage data evidence on which the wage determinations themselves are based; and (3) the Employees' Compensation Appeals Board program for which the Solicitor's Office renders legal services and assistance in the preparation of Board decisions. BUREAU OF LABOR STANDARDS I depend on the Bureau of Labor Standards to serve as a clearinghouse and center of information on labor legislation and to give technical guidance and assistance to the State labor departments. The increase of $125,000 will provide a program for improvement of workmen's compensation standards, expand the safety activities, and accelerate the program for employment of the physically handicapped. I think I should mention here that the physically handicapped program is administered by a President's committee. The Department furnishes housekeeping services for the program. Last year Congress approved $50,000 for a project to begin a program for eliminating some of the detrimental aspects of employment of domestic migrant labor. I am glad to report to you that through the President a committee has been appointed made up of the Secretaries of Agriculture, Interior, Labor, and Health, Education, and Welfare, and the Administrator of the Housing and Home Finance Agency. They have met, working committees have been appointed, and the program is moving forward. BUREAU OF VETERANS' REEMPLOYMENT RIGHTS This Bureau administers the reemployment laws, carrying out the obligation of the Federal Government to provide job protection for those interrupting civilian pursuits to serve in the armed services. It serves ex-servicemen, reservists performing training duty, persons rejected for military service, employers, and labor organizations. I am requesting an increase of $92,000 to enable the Bureau to keep abreast of a growing workload and reduce its backlog to a manageable level. Figures which the Bureau will present in more detail will show that the workload has increased 62 percent since 1952 without any increase in staff. There have been developed various techniques to facilitate the handling of the cases, but it is believed we have reached the point where additional staff is the only way to get operations on a current basis. BUREAU OF APPRENTICESHIP The apprentice training program has contributed to improvement of the skill and versatility of thousands of workers. As our economy continues to expand and with the rapid application of automatic processes, there is a demand not only for more skilled workers, but for expansion of skills of the present force to meet technological advances. The additional $100,000 requested will enable the Bureau, which is the operating organizational unit of the Department in the field of training, to increase its effectiveness in providing information, stimulation, and technical assistance to labor and management in the training of workers to higher skills. BUREAU OF EMPLOYMENT SECURITY The $2 billion paid to unemployed workers by the Federal-State employment security system in calendar year 1954 and the 14.2 million placements made by the employment service were an important stabilizing force in cushioning the recent economic downturn and in enabling the economy to make a rapid recovery. The principal role of the Bureau of Employment Security is to provide leadership and technical assistance to the State employment security agencies. The increase of $307,500 for this Bureau relates primarily to the new responsibilities growing out of the legislation enacted by the last Congress to which I have referred, and to the need for more current and detailed information on employment and unemployment. VETERANS' EMPLOYMENT SERVICE It is proposed to keep the Veterans' Employment Service in 1956 at its 1955 level of operations. However, the problems with which it must deal are increasing. For example, as of November 30, 1954, there were 21,205,000 living veterans, of whom 3,315,000 had had service since the start of the activities in Korea. The recently announced reductions in the Armed Forces will increase these numbers. The problems of integrating these veterans into the work force are increasingly difficult, and require continual emphasis to be resolved. There was an increase of 58 percent (from 36,974 to 58,402) in the number of disabled veterans registered in local offices for employment between June 30, 1953, and June 30, 1954, and recent figures show no diminution. For administrative expenses of the State employment security agencies, I am requesting an increase of $20,780,000. Of this amount, it is estimated that salary increases of State employment security personnel will require approximately $5 million. Salaries of employment security personnel are related to those of other agencies of State government. Approximately $7 million of the increase is to enable the employment services to do a more adequate job. The staff available for the Employment Service to assist workers in finding jobs and employers to find workers, has declined steadily over a period of years. In trying to serve as many workers and employers as possible, an inadequate job has been done in some functions, and service has been curtailed for some groups. An example is the decline in placements of skilled and professional workers because such placements entail more work, while at the same time the number of domestic and short-term placements has been rising. The Bureau of Employment Security has made a 2-year study to determine the time required to perform adequately such functions as taking new applications, counseling, testing, and placements. The increase requested will provide funds for the time required to adequately perform these functions and will permit more emphasis on the placement of skilled and professional workers. In my opinion, the most important activity of the employment security program is the placing of workers in jobs. Let me cite this simple example. In the third quarter of 1954 unemployment insurance benefit payments averaged $44 million per week. If the 1,800,000 workers drawing those benefits had been employed they would have earned $153,125,000, purchasing power would have been increased by $108 million and the unemployment trust fund would not have disbursed $44 million. The balance of the increase relates primarily to programs authorized by new legislation, other workload increases, related costs, and to provide contingency funds. Unemployment compensation for veterans program.—The unemployment compensation for veterans program, since it became effective on October 15, 1952, has assisted about 525,000 of the more than 3,400,000 discharged Korean veterans in making the transition to civilian life smoothly. For periods of unemployment while seeking jobs, Korean veterans have been paid in excess of $150 million through December 31, 1954. Under a recent Presidential proclamation, these benefits, along with others provided in the Veterans' Readjustment Assistance Act of 1952, will not be available for veterans who have not acquired eligibility by January 31, 1955. The proclamation will not affect the amount of benefits to be paid in 1956, but may result in some reduction for 1957. For 1956 an increase of $24 million is required, due to the increased number of eligible veterans in the labor force. Unemployment compensation for Federal employees program.—The new program for unemployment compensation for Federal employees which began on January 1, 1955, will provide the same protection for Federal employees during periods of unemployment that more than 36 million workers in private enterprise now enjoy. The program will provide benefits under the terms of the State unemployment insurance laws. We have negotiated agreements with all of the States to administer the program as contemplated by the legislation. We are requesting $40 million for the payment of benefits in 1956. Mexican farm labor program.-The Mexican farm labor program includes funds for the half-year July 1 to December 31, 1955 only, due to the expiration of the legislation. In both 1955 and 1956, approximately 350,000 Mexican workers will be contracted to agricultural employers. The number is far greater than has ever been contracted in this or any similar program. The increase is due, not to any substantial increase in the size of the agricultural labor force but rather to the success of the Immigration and Naturalization Service in keeping out illegal workers and |