Mr. MEEDS. If there is a lesson to be learned from your testimony, it is clearly that all these things about which you have spoken are very interrelated, and the success of any kind of manpower program is dependent upon a lot more factors than just pushing a button and sug gesting that that will solve it. It is dependent upon the welfare programs of the Nation, upon education, upon job placement, upon vocational education, preschool education-all the things that you have mentioned.

Clearly, your testimony, I think without question, is the kind of testimony that points up to us the diversity of any manpower program. As always, Wilbur, it is a pleasure to have you testify. I just wish we had about 3 more hours to listen to you further.

Mr. COHEN. Thank you, Mr. Chairman.

Mr. MEEDS. The committee is adjourned.

(Whereupon, at 12:03 p.m., the committee was adjourned, to reconvene March 17, 1970.)

MANPOWER ACT OF 1969

TUESDAY, MARCH 17, 1970

HOUSE OF REPRESENTATIVES,
SELECT SUBCOMMITTEE ON LABOR

OF THE COMMITTEE ON EDUCATION AND LABOR

Washington, D.C.

The subcommittee met at 9:30 a.m., pursuant to recess, in room 2175 Rayburn House Office Building, Hon. Dominick V. Daniels (chairman of the subcommittee) presiding.

Present: Representatives Daniels, O'Hara, Burton, Hawkins, and Scherle.

Also present: Representative Carl Perkins, chairman of the full committee.

Staff members present: Daniel H. Krivit, counsel; Sue Nelson, research assistant; Cathy Romano, research assistant; Charles Radcliffe, minority counsel for education.

Mr. DANIELS. The Select Subcommittee on Labor will come to order. We continue with hearings on H.R. 10908, H.R. 11620 and H.R. 13472 dealing with Manpower Act.

Our first witness this morning is Mr. Andrew J. Biemiller, director of Department of Legislation of AFL-CIO.

We extend to you, Mr. Biemiller, a most cordial welcome.

STATEMENT OF ANDREW J. BIEMILLER, DIRECTOR, DEPARTMENT OF LEGISLATION, AMERICAN FEDERATION OF LABOR & CONGRESS OF INDUSTRIAL ORGANIZATIONS

Mr. BIEMILLER. Thank you, Mr. Chairman.

Mr. DANIELS. You may proceed in any manner you desire. I know you have a statement.

Mr. BIEMILLER. It is reasonably short, and I think we will go with it. Thank you, Mr. Chairman.

I am accompanied by Mr. Goldfinger, Department of Research, AFL-CIO.

At the outset, let me make it clear that we in the AFL-CIO believe that the problem with which this committee is wrestling ranks with the major domestic issues that will come before this Congress.

In essence, that problem is jobs-good jobs, at decent wage levels, for every American able to work-in order to achieve full employment in America.

That's how we view manpower legislation, and we quite frankly say to you: Manpower legislation that does not include job creation is not manpower legislation at all. It serves no other purpose than to delude the public.

So we are here to urge you to enact manpower legislation that does create jobs, without any further delay. If you will pardon the cliche, the hour is already late."

This goal is best met by H.R. 11620, otherwise known as the O'Hara bill, which is cosponsored by 111 Congressmen. We urge adoption of this bill.

A Federal program to create public-service jobs for the long-term unemployed and seriously underemployed was needed in 1968 and 1969. It is even more essential today.

This Nation is now faced by both an economic slump and rapidly rising prices, after more than a year of the administration's policy of severe economic restraint, imposed in the name of combating inflation. Residential construction is now in a deepening recession, which started in February 1969. Industrial production is in a declining trend since last August. Sales of autos and other consumer hard goods are moving down. Layoffs and cutbacks in working hours are spreading in numerous industries. Unemployment is increasing. Industry is operating at less than 82 percent of productive capacity new plants and equipment are being installed at a rapid pace, while industrial production is declining and the operating rate is continuing to head down. But the rise in consumer prices accelerated from 4.2 percent in 1969 to 5.4 percent in 1969, as a whole, and a yearly rate of approximately 7.2 percent in the past 3 months.

The aggregate squeeze on the economy tightened during the course of 1969. The Nation's money supply hardly increased at all in the past 9 months; interest rates skyrocketed to peaks never before reached in the memory of living Americans; Federal construction projects were

cut.

The real volume of total national production declined slightly in the fourth quarter of 1969 and the President's Council of Economic Advisers forecasts little, if any, rise of real national output in the first half of 1970, with merely a small improvement in the second half and a modestly slower rise in the price level.

However, the spread of downward trends in many parts of the economy indicates that even this rather pessimistic statement of the administration's official forecast may be overly optimistic. Declining sales in the coming weeks may set off further cutbacks of production, if business decides to reduce inventories rapidly.

Increasing slack, with cuts in working hours and workers' weekly earnings, layoffs and a lack of sufficient job opportunities for a growing labor force are the inevitable results of the administration's economic squeeze.

In January, unemployment soared from 2.8 million at 3.5 percent of the labor force to 3.2 million at 3.9 percent-the largest month-tomonth increase in 9 months-and the factory workweek dropped to its lowest level in 2 years.

In February, the number of jobless shot up again-to 4.2 percent of the labor force, or 3.4 million unemployed-and the factory workweek declined again.

Already, unemployment is within a hair's breadth of the 4.3 percent unemployment rate which the chairman of the Council of Economic Advisers projected for the entire year, 1970, and unemployment is continuing to rise.

Much of the weight of this burden of rising unemployment will fall on blue collar workers, particularly those with the least work experience, the least skill and education, the most recenty hired-and this especially includes Negroes, members of other minorities and young people. Government and private programs to encourage employment of the hard-core jobless, especially minority-group workers, are being undermined and threatened with destruction.

That's the dimension of the problem. Now how do we solve it? In our opinion, an effective manpower policy must include:

1. Massive job creation based largely on a public service employment

program.

2. Consolidation and coordination of the varied manpower programs under the Department of Labor with overall responsibility for the direction and development of programs vested in the Secretary of Labor.

3. Training programs that emphasize upgrading rather than simply preparing the hard core for entry-level jobs.

By these standards the administration manpower bill is no policy at all. Simply put, it is merely a mechanism for consolidating and coordinating varied manpower programs. It is a housekeeping device solely to produce a measure of administrative order.

Everyone agrees with the need for coordination of manpower programs. However, coordination is a mechanism, not a policy. In our view, the need for an effective manpower policy is the top priority need.

Of the bills before you, only the O'Hara bill provides subsidized public service employment as an essential component. We completely support this concept. It is the most practical and realistic way to create jobs in large numbers for the long-term unemployed and seriously underemployed.

We are shocked by the Secretary of Labor's statement that the administration has no "intent to create jobs in the public sector, especially for the hard-core unemployed." We cannot agree with the Secretary of Labor's view that the basic responsibility of Government is to "commit itself to preparing people to fill those jobs" that will presumably materialize out of thin air in the private sector of the economy that has no major expansionistic opportunities because of the current economic slowdown policies being pursued by

the administration.

While no one would deny the importance of training in helping the disadvantaged to adjust to society, training in and of itself is not enough. It would compound the problem to give training and hope to the disadvantaged and then throw them back into the forass from which they came. We must not make this mistake.

Basic to solving the problems of poverty in America's work-oriented society, is a national economy that is growing rapidly enough to provide job opportunities for all persons who are able to work and seeking employment. Under such conditions-linked with an expanded manpower training program-the vast majority of workers will be employed in the normal channels of private and public employment.

For those who remain unemployed or seriously underemployed, a federally financed public-service employment program is the only logical answer. The Government should be the employer of last resort.

Such a program would create jobs and it would provide badly needed public services in hospitals, schools, parks, recreation centers and other public and private nonprofit facilities. Linked with training and guidance, such a program would make it possible for these workers to move into regular employment.

Private employers, no matter how lofty their goals and how hard they work to achieve them, cannot realistically do more than make a dent in the ranks of the hard-core unemployed.

Private enterprise is profitmaking enterprise. It would be naive to assume that business will hire, much less train, the disadvantaged at the expense of its profit structure. To the extent that private enterprise can hire and train the disadvantaged within the framework of its profit structure, it can make and has been making a contribution that is worthwhile. Such efforts should be applauded and encouraged. but their limitations should be recognized.

In the 2 years that Job Opportunities in the Business Sector (JOBS) has been operating, hard-core unemployed hired by business totaled 380,000. While this is a significant number, it hardly takes care of the millions in need. It should be noted, too, that the retention rate was 53 percent. Since November, reflecting the economic slowdown, terminations have risen, according to Paul Kayser, former NAB president.

In periods of economic downturn, hiring of hard-core jobless by private employers comes to a practical standstill, despite the best intentions of employers.

Two weeks ago Chrysler withdrew from its Government manpower contract to train 4,450 hard-core unemployed. This followed a series of layoffs, including 1,100 trained in the JOBS program. Chrysler's withdrawal occurred about the same time Lynn Townsend, chairman of Chrysler, became chairman of NAB and Byron Nichols, a Chrysler vice president, became president of NAB.

Massive job creation must derive mainly from the public sector. The people are available; the potential jobs are there, and the public need for these kinds of services has been established.

The Tripartite National Commission on Technology, Automation and Economic Progress, 1966, reported a potential of 5.3 million jobs in the public sector in such areas as medical and health services, education, day care, libraries, recreation, prisons, et cetera.

More recently Harold Sheppard of the Upjohn Institute, in a survey covering 130 cities, each with a population exceeding 100.000 and limited to only certain existing functions of the city, found the need for 280,000 jobs, of which more than half were of a nonprofessional and nontechnical category. As the author points out, however, the study sharply understates the total number of job vacancies due in part to the inclusion of only certain municipal functions and to the fact that the urban areas surveyed encompassed only one-third of the U.S. population.

We support the O'Hara bill in its proposal that the Federal Government subsidize jobs in the public service. Some people may say that we cannot afford the cost. We say that we cannot afford not to embark on this kind of a program.

President George Meany, in testimony before this subcommittee on May 7, 1968, commented on this concept in these words: