The CHAIRMAN. I introduced part of that to the Secretary informally before our meeting, particularly the formula that was included in the testimony yesterday.

If you comment on the formula together with what the Senator from Colorado has asked you about we would appreciate it. Secretary BRENNAN. Fine.

The CHAIRMAN. Do you understand that, Mr. Secretary?

Secretary BRENNAN. You were going to give us a copy of that? We don't have a copy of it.

Senator DOMINICK. We will get a copy of yesterday's testimony to you. That is very simple.

Secretary BRENNAN. Fine; from what I have seen of it, you better send an interpreter up with it, too.

The CHAIRMAN. The National Science Foundation people have put that together.

Secretary BRENNAN. All right. Thank you, sir.

[Whereupon, at 1:45 p.m., the subcommittee adjourned subject to call of the Chair.]

FAIR LABOR STANDARDS AMENDMENTS OF 1973

FRIDAY, JUNE 8, 1973

U.S. SENATE,

SUBCOMMITTEE ON LABOR OF THE

COMMITTEE ON LABOR AND PUBLIC WELFARE,

Washington, D.C.

The subcommittee met at 10:06 a.m., pursuant to adjournment, in room 4232, Dirksen Office Building, Senator Harrison A. Williams presiding.

Present: Senators Williams, Pell, Nelson, Eagleton, Javits, Taft, and Stafford.

Also present: Congressman John H. Dent and Commissioner Benitez of Puerto Rico.

Staff members present: Gerald Feder, counsel; Donald Elisburg, associate counsel; and Eugene Mittelman, minority counsel.

The CHAIRMAN. The Senate Labor Subcommittee will come to order. We, this morning, will conclude our hearings on the minimum wage legislation, S. 1861 and S. 1725. The committee will proceed next week to consider this and mark it up in the executive sessions.

We are grateful today that joining us is partner-observer Representative John Dent, of Pennsylvania, who guided the minimum wage legislation through the House of Representatives with considerable success from the standpoint of the majority of us on this subcommittee. We will go right ahead. Senator Pell, do you have a statement? Senator PELL. No, no statement.

The CHAIRMAN. We will proceed directly with our anchorman witness, the most loved, respected and distinguished president of the AFL-CIO, Mr. George Meany.

STATEMENT OF GEORGE MEANY, PRESIDENT, AFL-CIO; ACCOMPANIED BY NATHAN GOLDFINGER, ANDREW BIEMILLER, AND THOMAS DONAHUE

Mr. MEANY. Mr. Chairman, 2 years ago we appeared before this subcommittee and urged that the Congress give top priority to amending the Fair Labor Standards Act. At that time, we stated that the minimum wage should be increased to at least $2 an hour immediately and coverage extended to all workers.

We supported our recommendation by citing government statistics which showed that the number of poor persons in this country had increased in 1970 after declining through the decade of the 1960's. We pointed out that the $1.60 minimum wage was worth less in 1971 than the previous $1.25 minimum rate was worth in 1966 when the law was last changed. We supplied evidence which demonstrated (335)

that unless the Congress helped the minimum wage worker, he had no recourse except welfare in a period of spiraling prices. We made what we believed was an overwhelming case for prompt action in legislating an increase in the minimum wage.

Two years later, every single one of the specifics we cited in justification not only continue to exist, but they have worsened.

So we are back again to reemphasize that updating the Fair Labor Standards Act should be assigned the highest priority.

Mr. Chairman, you and a large majority of your subcommittee on both sides of the aisle have recognized how crucial this issue is. The efforts you have made and the persistence which you continue to show in trying to alleviate the critical problems facing low-wage workers is deeply appreciated.

I am here to urge prompt passage of S. 1861. We commend you for your expression of urgency when you introduced this legislation on May 22, 1973. We recognize that you have patterned your present bill after last year's bill in the hope that this would expedite enactment of the legislation.

Let me say, Mr. Chairman, that we do not regard all the provisions of S. 1861 as adequate to meet the needs which now exist. For example, $2 an hour today will not buy what $1.60 bought in 1966 or even in 1968. Nor will $2.20 a year from now fully compensate for escalating living costs. Nevertheless, the enactment of this bill would represent an important forward step and perhaps it will reverse the upward trend in the number of persons living in poverty, a trend which started in 1970 and continued in 1971.

The Census Bureau in a report released in December 1972, showed that 25.6 million persons were "low-income" or "living in poverty" in 1971. This is $1.4 million more than in 1969.

These are not just numbers; these are people. Many of them are members of families where the father or mother works full time, year round, but is unable to provide the family with even a minimum standard of living. Inflation has hit low-wage workers the hardest and many workers are questioning why they should continue to work when they can do little more for their families than those on welfare. In 1966, when the minimum wage of $1.60 an hour was enacted, the AFL-CIO took pride along with the Congress in the fact that for the first time in its history, a worker who worked full time year round at the minimum wage could provide something better than a life of poverty for his family. This is what the Fair Labor Standards Act was meant to do 35 years ago when it was first enacted.

The confidence instilled in the minimum-wage worker by the 1966 amendments, a confidence which reflected his ability to provide an above-poverty level of living for his family, did not last very long. In the last few years, the cost of living has continued to move upward at a rapidly increasing rate, and the purchasing power of the $1.60 minimum wage has plummeted. By April 1973, the latest date for which there is information on living costs, the $1.60 an hour minimum wage which looked so promising in 1966 was worth exactly $1.19.

Mr. Chairman, if our support of the minimum wage recommendations in S. 1861 sounds less than enthusiastic, it is only because we keep remembering what has been happening to prices since we recommended a similar wage schedule 2 years ago. During the 2-year delay in the

legislative process, the price of onions has increased by 83 percent; potatoes by 39 percent; chuck roast by 34 percent; and hamburgers, fish and eggs by 25 percent or more. These are all staples in the poor man's diet, and there are no "cheap" substitutes for him to resort to in order to feed his family.

That is why we repeat that one of the most urgent legislative matters before this Congress is to increase the minimum wage to at least $2 an hour now.

We welcome the provisions of the Williams bill to provide for a substantial increase from $2 to $2.20 an hour 1 year after the effective date of the legislation and we recommend a further increase a year after that to $2.50 an hour.

The Fair Labor Standards Act should also be broadened to cover all workers. The patchwork of exemptions currently included in the law means that almost 17 million workers are currently denied even its modest wage and hour benefits. An additional 6.5 million workers are in activities which have minimum wage protection, but which are exempt from the overtime provisions of the act.

Many of the unprotected workers are among the hardest-working, poorest-paid employees in the country today. They work on small farms, in restaurants, in stores-yes-even in State and local governments. They work as domestics and for this work, they are not even paid subsistence wages. Half of the household workers were paid less than $1 an hour in May 1971, according to a recent study by the U.S. Department of Labor, hardly the kind of wages which will increase the supply of domestics and meet the demand for such workers. All of these workers should be guaranteed "the minimum standard of living necessary for health, efficiency and general well-being," as stated in the declaration of policy in this statute.

When the question of updating the minimum wage law is under consideration, the same dismal predictions of resulting business shutdowns, massive unemployment and inflation are heard. As a result of these repeated complaints, Congress has ordered studies designed to measure the negative effects of minimum wage legislation after each change in the statute. Each study has proven how false these complaints are. Each study has consistently demonstrated widespread benefits for the economy as a whole accompanied by substantial gains for those at the lowest end of the wage scale and only isolated instances of adverse effects.

These studies have been conducted under both Republican and Democratic administrations and the findings have been consistent; the good effects have far outweighed any isolated adverse effects and the economy has benefited. We make no reference to the 1973 4(d) report of the Department of Labor because in our view this report does not contain "an evaluation and appraisal" of the minimum wages established by the act nor does it include recommendations for improving the statute.

However, Secretary of Labor Hodgson in his January 1972 report to the Congress evaluating minimum wage legislation stated:

On balance, the wage increases granted to 1.6 million workers to meet the $1.60 minimum wage standard had no discernible adverse effect on overall employment levels, and relatively little impact on overall wage or price trends.