towns, far from other centers of industrial employment. Textile workers who lose their jobs have scant opportunity for alternative employment in their labor market areas since they tend to be singleindustry communities. An examination of the available statistics on unemployment in particular labor market areas reveals the shockingly high rates of unemployment prevailing in textile areas, because they really tell a story (table III).

In virtually every State with substantial textile employment there are textile areas suffering from unemployment rates of more than 10 percent and in five States unemployment rates in textile areas are as high as 15 percent. In Maine, the Biddeford-Sanford area has an unemployment rate of 21.2 percent. Other textile communities with extremely high unemployment rates are to be found in Connecticut (Danielson, 12.3 percent), Rhode Island (Providence, 10 percent), Massachusetts (North Adams, 14.9 percent), New York (Amsterdam, 18 percent), New Jersey (Paterson, 9.1 percent), Pennsylvania (Wilkes-Barre-Hazelton, 18 percent, and Scranton, 16.8 percent), Maryland (Cumberland, 13.2 percent), Virginia (Roanoke, 10.2 percent), West Virginia (Parkersburg, 8.4 percent), North Carolina (Rockingham-Hamlet, 21.4 percent), Tennessee (Murfreesboro, 11.2 percent), Mississippi (Greenville, 8.1 percent), Alabama (Alexander City, 11.5 percent).

Because of the drastic character of the contraction of employment in the textile industry, unemployment tends to be of longer duration. When a mill is liquidated, particularly if it is in a single-industry town, the displaced workers have considerable difficulty in finding jobs. As noted by William H. Miernyk in his study of the experience of 1,075 workers displaced by the closing of six New England textile mills

the protracted decline in textile employment and the relative immobility of the displaced workers have produced a considerable amount of persistent unemployment in many textile centers in New England. The problem is not being solved by the growth of new industry in the region. * * * Nor can this unemployment be regarded as a temporary phenomenon. *** There is no reason to expect a larger proportion of displaced workers to be absorbed by other industries in the future. (William H. Miernyk, Inter-Industry Labor Mobility, Northeastern University, 1955.)

A large part of the unemployment of textile workers has been caused by mill closings. Since the war, at least 776 textile mills have been liquidated, displacing 216,000 workers (table IV).

I might add that at least 200,000 more workers have disappeared from this industry due to technology, mechanization, or call it some form of automation. Many of these mills were located in predominantly textile areas, where employment in the remaining mills was declining. The difficulties encountered by displaced workers in finding work are indicated by the fact that only 45 percent of the former mill workers contacted by Miernyk in his surveys of six closed mills were at work at the time of his surveys (usually a considerable time after the closing of the mill). Women and older workers had particular difficulty in finding jobs. Sixty-five percent of the displaced females were unemployed at the time of Miernyk's surveys. More than half of the workers that found new jobs were under 45 years of age, while only 29 percent of the unemployed were 45 years of age or under, meaning the older people just couldn't get a job.

Persons who have no intimate knowledge of the problem of chronic unemployment have argued quite casually that the people should move rather than stay in areas where opportunities for employment are slim. The workers should move on. Actually, many workers do move away. Unfortunately for the future of these communities, it is the young and unattached who do so. This mobility solves the problem for the few but not the difficulties of the many, the older ones.

There is a high mobility among textile workers. They have joined the mass movements which have built up the Western States, Florida and Michigan. But the process is a slow one. The average population increase for communities which have become chronically distressed is smaller than the remainder of the country, but the loss is not great enough to change the condition. It must be understood that there are many obstacles to such movement. There are strong local attachments, particularly among the middle-aged and older persons. They have become accustomed to their ways of life and have acquited a long term investment in homes and in their skills and acquaintances.

We already enjoy a high rate of mobility within the United States and it is unlikely that we could absorb a much higher rate than now exists.

The need for Federal standards, gentlemen, is great.

It is evident from the statistics on unemployment that textile workers have borne an inordinate share of the burden of joblessness in our dynamic economy. It would be fitting that special provision be made to meet the needs of these distressed workers. However, under the present system of State-determined unemployment benefits, textile workers actually suffer from discriminatory treatment. The amounts of their benefits are generally lower than in nontextile States and the maximum durations of benefits are inadequate to tide them over until they can find work. It is grossly unfair to deprive these long-suffering workers of the protection of an American standard of unemployment compensation. The textile States have demonstrated their inability or unwillingness to establish decent standards. It is time the Federal Government set such standards and put an end to the inequitable practice of providing the most niggardly unemployment benefits to those most in need.

The maximum basic weekly benefit provided in textile States varies from $26 to $45, with only two States (Connecticut and New York) providing more than $36. In the southern textile States the maximum basic weekly benefit is particularly low, ranging from $26 to $30.

If you will refer to table V, it graphically illustrates it here. In nontextile States, higher maximum benefits are common: 6 States provide a maximum of $40 or more and a total of 10 States (other than textile States) provide a maximum of more than $36. Moreover, 7 of the 14 textile States the average weekly benefit was less than $24 whereas only 3 of the 36 nontextile States had average benefits of less than $24. The average weekly benefit of the southern textile States was $22.41. Most of the nontextile States (20 out of 36) had averages of $28 or more compared to only 6 of the 14 textile States.

A measure of the inadequacy of existing benefits in a major textile area is provided by a survey conducted by the Bureau of Employ

39678-59-38

ment Security in the Anderson-Greenville-Spartanburg, S.C. area in the spring of 1957. The report of this survey shows that the family of a typical claimant in this area who had been unemployed for 6 or more successive weeks, suffered a markedly greater reduction in cash income during unemployment than the reduction which could be made in cash outlay. For a one-person household (single claimant) the decline in cash income during unemployment was from $178 a month to $92, a reduction of 48 percent, compared to a reduction in cash outlay of 16 percent (from $153 to $129). For a four-person household with claimant as head of the household, cash income was cut from $302 to $173 a month (a decline of 43 percent) compared to a decline of 10 percent in cash outlay (from $276 to $248).

The severity of the privations suffered by the families of unemployed workers in this area is further indicated by the fact that the average weekly benefit received by the head of a four-person household ($23) covered only 72 percent of the family's cash outlay for food, shelter, utilities, and medical care ($32) and only 40 percent of total cash outlay. In one-person households (single claimants), the average weekly benefit of $21 covered cash outlay on food, shelter, utilities, and medical care ($18) but amounted to only 70 percent of total cash outlay ($30).

The average amount of benefits received by claimants in the Anderson-Greenville-Spartanburg, S.C. area ($61 a month) represented only 28 percent of the wages received before unemployment in the case of the typical head of a four-person household ($220 a month) and 37 percent of the wages of single claimants in one-person households ($163 a month).

The maximum duration of benefits under State laws is clearly inadequate to meet the needs of textile workers. This is evident from the large proportion of claimants in textile States who exhaust their benefits. In the first 8 months of 1958, 690,986 claimants in textile States comprising 29.4 percent of the total, exhausted their benefits. (table VI). In half of the 14 major textile States, one-third or more of the claimants exhausted their benefits, which exhaustion rates of more than 40 percent recorded by Alabama (46.5 percent), Virginia (45.4 percent) and Tennessee (42.7 percent). The exceptionally high exhaustion rates in the States reflect the limited duration of benefits permitted by their laws (20 weeks in Alabama, 18 in Virginia, and 22 in Tennessee).

The most frequent maximum duration for benefits provided in textile States is 26 weeks. Eight States have this provision and one provides a maximum of 30 weeks (table VII). The five remaining major textile States provide a maximum of 18 to 22 weeks. A maximum period of 39 weeks is essential to provide a measure of protection which textile workers need to help them meet the difficulties faced in an era of contracting textile employment in distressed communities where alternative employments are difficult, if not impossible, to secure.

I might say here that for textile areas even 39 weeks is not enough because we find as an example in the State of Pennsylvania, even though there are only 500,000 people out of work, which is a lot. I shouldn't put it that way, but I mean compared to the number of people that are collecting surplus foods. There are 900,000 people collecting surplus foods in the State of Pennsylvania, which means

400,000 of those have worked, which means that 500,000 are probably collecting unemployment and still have to go and get surplus foods, and if we want to create some sort of dignity in human beings we have to create an atmosphere where there is an insurance system that provides them either a job or a decent amount of payment so that they don't have to go to relief and they don't have to go to surplus foods in order to get along. Special reports are going to be presented to you on Roanoke, Va., and later on the very serious problem in Biddeford, Maine, to illustrate the effect of plant closings on the lives of textile workers.

Congressmen, Federal reinsurance grants are sorely needed. A Federal system of unemployment compensation is important, for the impact of unemployment on the various States is extremely uneven. Shifts in consumer demand, the development of new technology and the exhaustion of natural resources have markedly different effects on State industrial employment patterns. As a result, unemployment tends to be concentrated in particular localities. Under the present system of separate State financing of unemployment compensation, individual States suffering from continuous heavy payments have depleted their reserves while huge accumulations piled up in other State funds. In 1958, two States had to borrow from the Federal loan fund, while reserves of almost $7 billion were retained in the other States.

The recent experience of Rhode Island and Pennsylvania are indicative of the difficulties faced by States with serious unemployment problems under the separate State fund setup. During 1958, the ratio of reserves to annual taxable wages in Rhode Island fell from 4.3 percent to 3.9 percent and in Pennsylvania from 3.6 percent to 1.5 percent while the average ratio for all States was maintained between 6.3 percent and 7.4 percent (table VIII). In January 1959, the Rhode Island ratio had dropped to 3.7 percent and Pennsylvania to 1.2 percent, while the U.S. average stood at 6.1 percent.

A Federal system of reinsurance is needed to pool the risks of unemployment throughout the Nation. Application of this basic insurance principle would place the financing of unemployment benefits on a sound and equitable basis.

In conclusion, I feel existing provisions for protecting workers against the hazards of unemployment are inadequate and inequitable. The workers in States which have the most need for higher benefits actually receive the least protection. Their weekly benefits are far too low to meet their needs. The duration of their benefits is so limited that millions of workers exhaust their benefits and are compelled to rely on the charity of friends and families of public relief. The reserves of States suffering from heavy unemployment, like Pennsylvania, for example, and in my own area, are very serious when they are depleted.

Federal action is imperative. The unemployment insurance system must be restored to its original purpose-to provide American workers with benefits adequate to preserve their dignity and self-respect during periods of unemployment. A Federal system of reinsurance grants must be developed to give reality to the principle of insuring the risks of unemployment.

Just in case I did not make it clear, this was Mr. William Pollock's statement, the president of our organization.

The CHAIRMAN. Mr. Stetin, we appreciate your coming to the committee in the absence of Mr. Pollock to give us the benefit of his statement on this subject.

Without objection, the tables which are appended to your statement and referred to by you will be included in the record at this point. (The tables referred to follow :)

TEXTILE WORKERS UNION OF AMERICA, RESEARCH DEPARTMENT, NEW YORK, N.Y. TABLE I.—Employment in the textile mill products industry, by State, February 1951 and January 1959