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Employment security: State accounts in the Federal unemployment trust fund and Federal grants for State administration by State, fiscal year 1952-53-Continued

Source: Except for Federal grants, all data are compiled from data furnished by the Treasury Department, Division of Investments. (In thousands.)

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The CHAIRMAN. The gentleman from New York has consumed 20 minutes.

The Chair recognizes the gentleman from Tennessee [Mr. COOPER].

Mr. COOPER. Mr. Chairman, I yield myself such time as I may require.

Mr. Chairman, the pending bill would extend unemployment insurance protection to about 1.3 million workers in private industry and 2.5 million Federal workers. Coverage would be extended to the 1.3 million workers in private industry by changing the definition of employer so as to make subject to the unemployment tax employers who have 4 or more employees in each of 20 weeks during a year. Under present law, the tax is imposed only on those employers who have 8 or more employees in each of 20 weeks during the year. This, of course, would extend unemployment insurance protection to employees in smaller firms and businesses. The provision would be effective with respect to services performed after December 31,

1954.

With but minor exceptions such as Federal employees receiving a salary of $1,200 or less in a year, unemployment insurance protection would be extended to all Federal employees. This would be done by authorizing the Secretary of Labor to enter into agreements with the States under which the States would administer the program as to Federal employees in accordance with their own laws. If a State does not enter an agreement with the Federal Government, the Secretary of Labor would make unemployment insurance payments under the provisions of the laws of the State where the Federal employee was employed. In most cases the State law which would be applicable in the case of Federal employees would be the one where the Federal worker had his last official station when he became unemployed. A Federal employee would be considered as still being employed until he has used up all of his annual leave. Unemployment insurance benefits would be payable to Federal workers who are unemployed after December 31, 1954.

Under present Federal law, an employer cannot get a so-called experience rating until he has had at least 3 years' experience as an employer. An experience rating is based on the employment record of an employer, and in those cases where this record is a good one, the effect of an experience rating is to reduce an employer's tax. Our committee felt

Federal grants for administrative fiscal year

$1,905 4,009 1,428 3,020 611

that it is somewhat of an inequity and a competitive disadvantage to new and newly-covered employers to require them to wait for 3 years before they can secure a reduction in their unemployment tax. The effect of this requirement is that during the first 3 years, such employers must pay the full tax of 3 percent, without any offset, regardless of how good their employment record may be. The bill provides that a new or newly covered employer can secure an experience rating after 1 year's employment experience. This provision merely This provision merely permits a State to extend a rate reduction if it so desires. It is not mandatory on the States to do this.

The bill also eliminates the privilege of employers to pay their tax in quarterly installments. Employers are not required to pay the tax until after the close of their taxable year, and under present law they have the privilege of paying their tax in four quarterly installments. Representatives of the Department of Labor informed our committee that about 85 percent of unemployment taxes are paid when due, without employers exercising the option of paying in quarterly installments. We were also advised that the elimination of the quarterly installment privilege would reduce considerably the administrative burden of the Government, particularly in light of extending coverage to smaller firms-those employing four

or more persons.

The improvements in the unemployment insurance program contained in the pending bill, on the whole, are desirable ones.

Mr. COOPER. Mr. Chairman, I ask unanimous consent that the gentleman from Michigan [Mr. DINGELL] may extend his remarks at this point in the RECORD.

The CHAIRMAN. Is there objection to the request of the gentleman from Tennessee?

There was no objection.

Mr. DINGELL. Mr. Chairman, the pending bill is a faltering step of the present administration in meeting one of the most serious problems facing us today. With about 8.5 percent of the labor force either unemployed or voluntarily on short time, the administration has completely sidestepped its responsibility to provide adequate unemployment insurance protection not only for workers but as a means of bolstering the economy of the country as a whole, by pulling the old French protocol stunt of "After you, my dear Alphonse," in

that it has expressed its concern about insufficient insurance payments both as to size and duration, but has recommended to the States that they take action to correct the deficiencies. Buck passing in typical Army style comes naturally in this administration and is so different than what used to be the positive policy and practice under Roosevelt and Truman. On President Truman's desk he used to have a sign "Buck passing stops here," and he surely took the bull by the horns with his own hands fearlessly and honestly.

As a practical matter, we who have been interested in an adequate unemployment insurance program over the years know that the States either will not or cannot make the needed improvements. The administration's attitude, of course, is very pleasing to the opponents of an adequate unemployment insurance program, because they not only are in a position of dealing with a national problem at the State level when needed legislation is left up to the States, but also can argue that for competitive reasons their particular State should not provide more adequate benefits.

I fully support the extension of insurance protection to Federal employees and employees in smaller firms. However, I remind you that the present administration has done nothing to bring about basic improvements in the unemployment insurance system. The Eisenhower administration has the opportunity of proving its sincerity and liberalism as we Democrats never did, because we will support every move to benefit the worker in every reasonable motion they will propose. We were always handicapped to a marked degree because of solid reactionary leaning of the Republicans reinforced by a Democratic coalition. This combination was paralyzing at times and compromises at best were inevitable. Now, however, the Republicans can be liberal and sure to carry because the great bulk on the Democratic side of the aisle will support them. Let us cut out the talk, Mr. Chairman; let us act.

We are now faced squarely with the problem of providing an unemployment insurance program which is adequate. The only way we can do this is to meet it head on with improvements that will provide genuine protection to unemployed workers, with the shot in the arm for our vacillating economy which such protection will bring about.

The opponents to an adequate unemployment insurance program always bring up the false argument that more adequate benefits will induce idleness. This is an insult to decent and honorable American workers. Certainly unemployment benefits lasting for a period of 26 weeks, with maximums at twothirds of a State's average weekly wage and one-half of the individual worker's average weekly wage, can be no temptation for any self-respecting and decent citizen to remain idle. I refuse to believe that any American worker, and particularly one with a wife and children, having obligations to meet each and every week, including mortgage

payments on his home, would remain idle if he can work steadily.

Workers have certain expenses which they must meet daily, weekly, and monthly, and they dread the thought of going into debt. To expect them to exist on the pitiful unemployment insurance payments which are now available is asking too much. Unemployed workers, in order to hold on to their homes, educate their children, and exist, must meet certain minimum expenses at all times. Inadequate unemployment benefits mean that not only do the workers have to endure the sufferings and heartaches of unemployment, but also they must forgo buying sufficient food, clothing, and other essentials. With the cost of living being what it is today, even fully employed workers have trouble enough making ends meet.

The present administration has again met a pressing problem with highsounding words and exhortations, not with real and effective action. This bill will bring very little solace to the unemployed workers of the country.

Mr. SIMPSON of Pennsylvania. Mr. Chairman, I yield 2 minutes to the gentleman from New York [Mr. JAVITS].

Mr. JAVITS. Mr. Chairman, I introduced, jointly with my colleague, the gentleman from Wisconsin [Mr. O'KONSKI), as well as a group of Members from the other body, the so-called Forand bill to improve the unemployment-compensation system, and I intend to support the amendments which my colleague, the gentleman from Rhode Island [Mr. FORAND] will offer.

I think that the concrete base of full coverage of social security and unemployment insurance and an adequate national-health program must be fundamental policy in the private economy and is what the Republican Party ought to be devoted to. As we want a strong private economy and that is the great point of this administration, it has to have a strong concrete base. This is the best fortification way to give assurance against the fear of recession.

We just have word that employment is at a high level of 62,098,000 with a sharp contraseasonal drop in the normal May-June increase in unemployment. But we still have an estimated 3,047,000 unemployed and it serves to depict to us the numerical importance of adequate unemployment compensation and the danger of complacency in this field which determines the well-being and tranquillity of our people. The two additional amendments which the gentleman from Rhode Island will offer are very desirable. I would have wished also to support a proposal to cover all establishments with one or more employees, but it will not be before us. By setting as a minimum and maximum, 50 percent and 66% percent of the average State wage for unemployment compensation and also a national standard of 26 weeks of such compensation we avoid the competition between States in this area which is so vital for the working men and women to attract business to them, because they give less benefits in unemployment compensation. I think it is very desirable that there be a fundamen

tal standard, just like the minimum wage-even though it is inadequate under present conditions-for the American workingman. I am very proud that the administration has produced this first revision and liberalization of the unemployment compensation system since 1935. I feel that we are starting on setting a national standard for unemployment compensation by reducing the number of employees in establishments which are covered from 8 to 4. But I feel we can and should do more with the measure before us. I think we should join many of our Democratic colleagues in saying that the added national standards for unemployment compensation, which the gentleman from Rhode Island will propose, together with the bill before us, really represents an important part of that concrete base that can fortify the private economy. We believe in the private economy and the way to make it work is to make it strong. I think the Forand amendments will make this concrete base stronger under the private economy and I shall therefore support them.

Mr. COOPER. Mr. Chairman, I yield 15 minutes to the gentleman from Rhode Island [Mr. FORAND].

Mr. FORAND. Mr. Chairman, I ask unanimous unanimous consent that immediately following my remarks, the gentlewoman from Missouri [Mrs. SULLIVAN] may extend her remarks.

The CHAIRMAN. Is there objection to the request of the gentleman from Rhode Island?

There was no objection.

Mr. FORAND. Mr. Chairman, the pending bill, H. R. 9709, will bring much needed protection to about 4 million additional persons, but it does nothing at all for the workers who are already covered by unemployment compensation. The country is suffering from serious unemployment at the present time; in fact, the Departments of Labor and Commerce report that 3,447,000 were unemployed early in June, and that is an increase of 42,000 over the month of May.

Now, it seems in all the publicity being given to this subject, the employment figures are played up and the unemployment figures are played down. I am glad to see the number of employed persons as high as we can possibly make it, and we need it in this country. But I am also very much concerned with the large number of unemployed, because while we speak of the present circumstances as either being a mild recession, a readjustment, or what have you, to the individual who is out of a job and who is running out of money so that he has difficulty maintaining his family-I say to you that that person is in a depression. That condition needs remedying and remedying right now. The June employment, they tell us, was at the highest figure since last October; but actually it was 1 million below the employment figure of 63 million in June of 1953. The mid-June unemployment was more than twice that of a year ago and with the exception of 1949 was well above the corresponding period of any previous postwar year. Yet the ad

ministration and the Congress are doing nothing to remedy that situation except passing the buck to the States.

The average unemployment insurance payment in this country is less than $25 a week. I do not have to tell you that this is not even sufficient to meet nondeferrable expenses and that the unemployed are being forced to use up what little savings they have and then turn to public assistance, if they can get it. Payments of unemployment compensation benefits have lagged seriously behind the average weekly wage since the unemployment insurance program was established. The original intent in the program was that the payments should equal about 50 percent of the weekly wages. While average weekly wages in covered employment trebled between 1936 and 1953, the dollar ceilings for unemployment insurance payments on the average did not even double. Wages have been outdistancing ceilings continually until we have reached the point where weekly insurance payments represent only about two-fifths of the average weekly earnings of workers compared to the two-thirds in the 1930's. Only about $1 out of each $5 in lost wages and salaries is being replaced by unemployment insurance payments at the present time.

Not only are payments inadequate, but their duration is far too short to carry many workers until they are able to find other jobs. At the present time about 40,000 workers a week are exhausting their rights to payments. So far this year well over one-half million workers have exhausted their benefit rights. The present administration while recognizing that something must be done to increase payments and their duration has shirked its responsibility by suggesting to the States that they take the necessary action to do this. In my opinion, this can hardly be considered part of a dynamic program which we have heard so much about in the last couple of years. Those of us who have sought to bring about realistic and adequate improvements in the unemployment-insurance program over the years know that it is very difficult for the States to increase insurance payments and durations even in those cases where they are willing to, because of the competitive situation with which they are faced. We also know that the opponents of adequate unemployment insurance take full advantage of the situation which the present administration has got itself into by insisting that improvements in payments and their duration should be made at the State levels. Then the opponents turn around and they go to the State legislatures and say, "You should not and cannot provide adequate benefits because if you do our State I will be at a competitive disadvantage compared to neighboring States." They have very successfully played both ends against the middle, with the result that insurance benefits have become less and less adequate over the years.

The major reason for the Federal Government's enacting unemployment-insurance legislation in the first place was on account of the competitive situation which would develop if each State proceeded individually to establish an un

employment-insurance program. Right here I want to say to you that you have heard and probably will hear more that the amendments which I intend to offer in the committee are an invasion of States rights and that we are setting new standards-and, by the way, I intend to offer those amendments and a motion to recommit if the amendments are voted down in the committee, and, of course, I intend to get a rollcall vote on the motion to recommit.

If you will read the original act you will realize that at the very outset certain standards were fixed by the Federal Government when we said to the States, "If you want to come in under this program you will have to submit to us a program that is satisfactory. You will have to meet certain requirements." Therefore, the amendments which I shall offer will only provide perhaps a few additional standards which must be met by all and which the States themselves have failed to take care of, despite the fact that in his economic report the President suggested to the States that they increase the benefit amounts and also the period of benefits, which is all my amendments provide.

Also, the Secretary of Labor in February of this year wrote to the governors of all the States advising them that the President was suggesting that action along those lines be taken, but all of that fell on deaf ears. The States have failed to act. Therefore, I say to you it is the responsibility of this Congress to act to remedy the situation with which we are faced.

We must consider, and consider seriously, I believe, that unemployment compensation benefit payments are very, very important. They do two things: They do two things: One, they help the unemployed worker by tiding him over, permitting him to feed himself and his family and clothe and house them, meager as the benefit amount is. Secondly, it provides purchasing power which is reflected in the business of every businessman in the community. It is a great help economically, and that has been proven time and again through newspaper articles and statements that have been made by individual businessmen in those areas that were so sadly affected.

The Congress realized that the States were faced with this situation, and I refer now to the competitive situation, and enacted legislation levying a uniform 3 percent tax on all employers throughout the country, there is one of your standards, with a credit provision of 90 percent in those cases where the States have an unemployment insurance program meeting certain basic requirements as to disqualifications, and so on, set forth in the Federal law. In addition, the Federal law permits an experience rating credit based upon the employment record of employers. In my opinion, there would be very few States today with adequate unemployment insurance programs had not the Federal Government taken this action. The very same reasons which impelled the Congress to take the initiative in establishing the unemployment insurance program in the first instance also controls when it comes to maintaining adequate payment

both as to size and duration. Minimum requirements had to be established by the Federal Government in this field because unemployment insurance deals with economic problems which are Nationwide nomic problems which are Nationwide and beyond the control of the individual State. It is being claimed that the present administration is making extensive improvements in the Federal-State unemployment insurance program. My friends, the only improvement of any account, which would be provided by the bill now under consideration, is an extension of coverage. Nothing whatever is being done for those workers who are already covered. As a matter of fact. I was the author of a bill in the 82d Congress which was reported to this House, and which provided for coverage of Federal employees. This group makes up the bulk to whom coverage would be extended in the pending bill. For years I have led the fight to improve unemployment insurance, and while I fully support the extension of coverage provided in this bill, I deny any claims that basic improvements are being made in the unemployment insurance program as a result of the bill, H. R. 9709.

The need is urgent to increase the size and duration of payments. The unemployment insurance payments have proved their value to the economy of the country, and particularly to local communities time and again. More adequate benefits during this period of adequate benefits during this period of high unemployment and readjustment can do as much to bolster our sagging economy as any other one thing which the Congress can do. The relief which should be provided every family by more adequate benefits from the tragedy resulting from unemployment cannot be measured in dollars. measured in dollars. Our whole Nation stands to gain by a more adequate unemployment insurance program. It is my intention when we get into the House to offer two amendments which on yesterday I inserted in the CONGRESSIONAL RECORD.

Mr. LANE. Mr. Chairman, will the gentleman yield?

Mr. FORAND. I yield.

Mr. LANE. I congratulate the gentleman on the very able and forthright statement he has just made to the House. I know he is quite conversant with this subject matter, and I am aware of the fact that over the years he has studied unemployment compensation legislation as a member of the great Committee on Ways and Means of the House. I know the gentleman represents a district in New England which has a great deal of unemployment, as a result of the slump in the textile industry, which is a very, very sick industry today. The gentleman has lived with this problem over the years and knows whereof he speaks. I rise in support not only of the statement that he has made, but in support of the amendments he proposes to offer later in the day. I again congratulate the gentleman on this noble effort to bring this to the attention of the Congress and to the attention of the Nation. UNEMPLOYED AMERICANS WITHOUT UNEMPLOY

MENT COMPENSATION BUY NOTHING

New England has expert knowledge concerning the problems of the unem

ployed, because we have so many of them concentrated in communities that were once leaders of the textile industry.

Unemployment compensation is the only factor that provides food and energy and keeps up the morale of displaced workers while they search for jobs to give meaning to their lives again.

The present unemployment-compensation formula is too low and too short.

It is like an undersized lifeboat that is guaranteed to save part of the crew and carry them for a while before dumping them overboard to take on others.

Of course, we would prefer to see new industries or the Federal Government itself, come to their aid with substantial help. In the experience of New England, these S O S calls have not been answered. In fact, the Government has been taking the life preservers away from the crew by cutting down employment at Government installations, and by insisting upon policies that are making the weather worse for our fish and textile industries, among others.

Two recent items in the news, puzzle and disturb us.

We cannot escape the conclusion that the Government of the United States appears to have lost touch with the problems of its own people.

The first item informs us that the United States has released almost $14 million to relieve unemployment in West Berlin, which is some distance away from New England.

The second, under date of July 3, quotes the National Planning Association-a private group composed of businessmen, labor-union leaders, economists, and bankers-as predicting that unemployment will nearly double over the next year at the present rate of economic activity.

At this point, I would like to remind the administration that it is failing to promote maximum employment, production, and purchasing power which was slated as the objective of United States policy in the Employment Act of 1946.

When it is taking jobs away from people, or failing to take action that will save the ones that they have, the least it can do under these circumstances is to secure legislation that will increase and extend unemployment compensation benefits.

One or the other.

It cannot default on both and then expect to retain the confidence of the people.

In the absence of positive and contermined to press for substantial imstructive leadership, the Congress is de

provement in unemployment compensation.

We want a benefit ceiling of at least 66% percent, and a floor of 50 percent 39 weeks. Above all, it is necessary to of wages. Duration must be extended to pensation Standards Act, to prevent unenact a Federal Unemployment Comfair competition among States and employers.

H. R. 9707 represents a token gain in that it extends coverage to employers of 4 or more persons in place of the prevailing 8 or more.

This does not go far enough.

From the report of the Committee on provide-1, for Ways and Means, I quote:

From the standpoint of the individual worker, unemployment insurance protection is as important if he works for a small employer as if he works for an employer of thousands. Moreover, it is as important to maintain the purchasing power of employees of small firms as of large firms.

H. R. 9707 still sanctions discrimination when it fails to cover employers with 1 to 3 employees.

To be fair, it must cover all. We in New England take pride in the fact that we try to improve labor standards instead of sabotaging them. We have seen industries lured away from us to other sections where they can evade their social and economic responsibilities. Our burden of unemployment has But we shall increased as a result. never try to hold an industry that practices this form of blackmail. We beWe believe in progress consistent with the national welfare, not cuthroat competition among the States to downgrade the standards and the security of American labor.

H. R. 9709, calling upon all the States to be good fellows about this problem, will not strengthen unemployment compensation for the Nation.

It will not prevent some States from keeping benefits low and brief while adding to disqualifications.

In fact, hypocritical evasions and unfair competition will be encouraged.

We, therefore, insist that the proceeds of the Federal Unemployment Tax Act shall be earmarked in a Federal unemployment account in the Federal Treasury to pay Federal and State administrative expenses and to provide reinsurance grants to those States who are in financial difficulty because of high rates of unemployment. These grants would permit States with unusually heavy unemployment to make adequate payments without raising employer taxes so far above levels in other States as to accelerate the out-migration of industry.

Unemployment is governed by nationwide economic forces and should be dealt with on a nationwide basis.

We urge adoption of the more realistic provisions contained in H. R. 9430, sponsored by the gentleman from Rhode Island [Mr. FORAND]. Any other course would be a cruel deception to millions of unemployed and to all others who live in fear of unemployment.

Mr. FORAND. I appreciate very much the statement made by my good friend, the gentleman from Massachusetts whose district is one of those also suffering extremely under the existing circumstances. I compliment the gentleman for the work he has been doing, and which he has been carrying on in this fight. But this fight, my friends, is not limited to the gentleman from Massachusetts [Mr. LANE] or myself or anyone else individually. That is the reason some 87 Members of the Congress joined together and prepared a bill, working at it for over 2 months, a bill which I introduced in the name of all of us, on June 3 of this year. That bill goes much further than the two amendments I am going to offer. These amendments will

During the first 5 months of this year, 658,000 workers exhausted their unemployment compensation benefits, as compared to 348,000 in the same period last year.

provide-1, for an increase in the 2, for 26 amount of benefits, and 2, for 26 weeks of benefits. I am restricting my amendments to those which the President of the United States, your President and my President, had recommended to the States that they have their legislatures act upon. If you want to go along with the President, then you will vote for the amendments. Mr. HALLECK. Mr. Chairman, will May 27, reports that Ben Fairless prethe gentleman yield? dicted that his company's operating rate

Steel production currently is running at 72.6 percent of capacity. This means that the current week's production will be 450,000 tons of steel short of the same week a year ago. The New York Times,

Mr. FORAND. I am glad to yield to would remain for the rest of 1954 at close the majority leader.

Mr. HALLECK. Have the State legislatures been in session so that they could have an opportunity to respond to that request up to this time?

Mr. FORAND. Several of them have. Many of them have not.

Mr. HALLECK. I think most of them have not been in session. At least I know my State legislature has not had a session since that recommendation was

made. That recommendation was made in January of this year, was it not?

Mr. FORAND. The President's recommendation; yes.

Mr. HALLECK. The only point I was making, I do not think the States have had an opportunity to respond to that request of the President.

Mr. FORAND. If you want to pin it down specifically to the request of the President, perhaps the gentleman is right. Not enough of the legislatures have met. Many have failed to act; but over and above that, away beyond the time that the President made his suggestion, the need was there, and we have failed to act.

How anyone can vote against my amendments after considering the following facts is beyond my comprehension.

Here are the facts about the present economic situation as of June 24, 1954:

Over the last year-May to Maytotal nonagricultural employment has declined 1 million. Agricultural employment is up 400,000, making a total civilian employment decline of 600,000.

Because of a net increase in the labor force of 700,000 and because of an increase in productivity which displaces 1,800,000 workers a year, a total of 21⁄2 million new jobs each year must be provided.

Manufacturing employment over the last 9 months, beginning in September, has declined 1,734,000. Since May of 1953, the decline has been 1,500,000.

In May of this year, there were 10.1 million workers employed for less than 35 hours a week, as compared with 9,300,000 a year ago.

According to the Department of Commerce, 31.6 percent of those currently unemployed have been unemployed for 15 weeks or more. 15 weeks or more. The figure was 15.9 percent a year ago.

In the week ending June 12, 286,069 workers received their first unemployment compensation checks. This is 23,000 more than the preceding week and 116,000 more than a year ago.

During the week of June 12, 2,035,000 workers were receiving unemployment insurance, 70,000 greater than the preceding week; 1,200,000 greater than a year ago.

to the 73 percent. Same article reports that Mr. Grace, of Bethlehem, will be satisfied if Bethlehem's rate could remain at 72 percent.

Auto production is off 15 percent from a year ago. During second half of 1954 auto production is scheduled to drop one-third below first half of 1954.

Industrial production is off 9 percent from a year ago. The reported upturn from April to May is the result of the

figure being seasonally adjusted. Actual operating rate for industrial production in May was identical with April.

Weekly hours in May were 39.3. This is 1.4 hours less than a year ago. The reported upturn in May of 0.3 hour per week was due to a comparison with the April figure, which was low because, according to the BLS of the Department of Labor, it reflected the week which included Good Friday.

Business failures in the week of June 12 totaled 206 as compared with 218 business failures the preceding week and 167 in the similar week a year ago. Most of these business failures were among small businesses.

Department store sales for the first 6 months-that is, up to June 12-were 3 percent less this year than last year. For the 4 weeks ending June 12, department store sales were 5 percent less than in the similar 4 weeks a year ago.

Total sales of retail stores were 3 percent below May a year ago and 21⁄2 percent lower for the first 5 months of this year.

JUNE EMPLOYMENT FIGURES

The administration and the press are making much of the fact that unemployment did not rise between May and June by as much as is usual for this season of the year. It rose by only 42,000 this year, whereas the average May-June rise in unemployment has been 367,000 in the postwar years 1946 to 1953.

This less-than-normal rise in unemployment was not due, however, to a more-than-seasonal rise in employment. The employment increase between May and June was also less than is usual at this season. It increased by 979,000, which is half a million below the usual May-June increase of 1,500,000.

The reason why June unemployment showed such a small increase this year, even though employment was increasing less than usual, is that the labor market recorded a subnormal gain in June. Average May-June increase in the civilian labor market in postwar years has been 1,875,000, whereas this year it increased by only 1,020,000. This 855,000 deficit in the June labor market actually represents hidden unemployment, potential jobseekers who fail to get counted as

unemployed because they have been discouraged from job seeking by the prevailing Eisenhower recession.

For the whole period of the seasonal upturn from January to June 1954 compares with the average of other postwar years-1946 to 1953-as follows: The civilian labor market increased 2,600,000-actual, 2,605,000-as compared with the usual 3,600,000-actual, 3,580,000; employment increased 2,300,000 actual, 2,345,000-as compared with the usual 3,600,000-actual, 3,647,000; unemployment increased 260,000, as compared with a normal decrease in unemployment of 67,000.

On a comparison with June 1953, there is little to cheer about in the June employment figures just released.

The civilian labor market increased over the year by 711,000, which falls considerably short of the 971,000 average annual increase that took place in the previous 7 years. Employment is now Employment is now 1,074,000 less than a year ago. An exceptionally large part of this reduction is in agriculture, 498,000. Nonagricultural employment is 576,000 smaller than a year ago. Unemployment is 1,785,000 greater.

Manufacturing employment declined slightly in June for the eighth month in a row. The June figure of 15,829,000 wage and salary workers in manufacturing is 1,587,000 less than the 17,416,000 so employed in June 1953. Average hours of manufacturing production workers in June were 39.6, compared with 40.7 hours a year ago. This reduction of 1.1 hours a week for 16 million workers is the equivalent of full-time unemployment for an additional 440,000 workers.

Mrs. SULLIVAN. Mr. Chairman, I am grateful to the gentleman from Rhode Island, [Mr. FORAND], for making arrangements for me to have my remarks on the Unemployment Compensation bill placed in the permanent RECORD as part of the debate on the bill. A very sad occasion, a death in the family, required my presence in St. Louis at the time the bill came before the House, and thus it was impossible for me to be present for the debate. But I do want the RECORD to show how deeply disappointed I am in the scope of the bill presented to the House under a title which I think is a misleading title, that is, a bill "to extend and improve" unemployment compensation.

This bill will add very few people to the unemployment rolls in Missourionly those who work in establishments employing from 4 to 8 people and the comparatively few Federal employees in Missouri, about 45,000. The Federal employees should be covered, of course, but I am afraid this bill does very little for any of those who have already lost their jobs because of reductions in force, since no benefits can be paid to jobless Federal employees under this bill until next year. I am also disappointed in the failure of this bill to increase benefits in any way whatsoever in any State or jurisdiction. The maximum benefits in Missouri today are $25 a week. That is obviously not enough to keep a family going-not with the cost of living in St. Louis, for

instance, more than 2 percent higher than it was a year ago and apparently still rising. The latest Consumer Price Index shows an increase of nearly 1 percent in the cost of food from April to May of this year in St. Louis; it shows meat going up in almost every category and many of the fresh, frozen, and canned fruits and vegetables going up, even such staples as pork and beans, shortening, margarine, lard, sugar, jelly, and so on, and of course the average retail price of coffee on the Consumer Price Index has reached $1.18 a pound. Not only food, but housing, medical care, personal care, transportation, and some apparel items have been going up.

With the cost of living at about a record level, it is wishful thinking to believe that an unemployed worker can keep his family going on $25 a week.

The Forand bill, which I cosponsored along with more than 80 other Democratic Members of the House, would have done a lot to improve the situation if the House Ways and Means Committee had approved it instead of the inadequate bill it did report out. It would have extended the period of coverage for unemployment compensation benefits to a maximum of 39 weeks, and in Missouri it would have meant an increase in the benefits to a top maximum of about $44 a week instead of $25. The formula proposed in the Forand bill would provide benefits equal to half pay based on a worker's normal wage up to a maximum of two-thirds of the State's average weekly wage. So in Missouri that would mean a benefit of $44 a week for any worker who normally earned $88 a week or more, and half pay for anyone whose normal wage was less than $88 a week or more, and half pay for anyone a whole lot more workers now excluded from unemployment compensation by removing many of the present restrictions on the size of a business firm eligible for coverage. ble for coverage. In other words, instead of taking in just those additional workers who are now employed in firms hiring from 4 to 8 employees, it would cover in a total of about 153,000 Missourians who work in small firms employing from 1 to 8 persons.

The reason I am so distressed about the inadequacies of the Reed bill is that St. Louis itself is a distressed community, an area of substantial unemployment. The Department of Labor reports that in March unemployment was estimated at 50,400, or more than double the level of a year ago. The Bureau of Employment Security added that further layoffs were expected in autos, primary metals, ordnance and shoes, and that these would offset the expected seasonal buildup in construction, trade, transportation, and food. We know that thousands of Missouri workers who have been unemployed have used up all of their unemployment compensation benefits without finding new employment. these things taken together make it obvious that the Congress is not "extending and improving" unemployment compensation in any practical manner compared to the frightful economic probpared to the frightful economic problems faced by the families of those who have lost their jobs.

All

I hope the Senate, in considering this same legislation, will approach it in a much more realistic fashion and really improve unemployment compensation by increasing benefits sufficiently to enable people on unemployment compensation to live decently during this difficult period of recession and readjustment. The Democrats on the Ways and Means Committee, in their minority report, stated this problem concisely and accurately when they said that the majority of the Committee on Ways and Means have given to the people on unemployment compensation not bread but a stone.

Mr.

Mr. SIMPSON of Pennsylvania. Chairman, I yield 5 minutes to the gentleman from Missouri [Mr. CURTIS].

Mr. CURTIS of Missouri. Mr. Chair

man, I will not take the 5 minutes. I simply want to state that, of course, I am behind this bill which came out of our committee. Essentially I think it is a good bill and it is perfecting our unemployment-insurance program. I think the test of time has shown that the balance that has been worked out

between State and Federal Governments in this field has been a pretty good one. Essentially, the arguments that will be advanced in behalf of the amendment which will be offered by the gentleman from Rhode Island [Mr. FORAND] are the question of whether that balance should be changed and whether or not the Federal Government should be taking a more detailed part in the program instead of letting the States proceed. But the main reason why I took the floor at this time is to call attention to the unit actually

employment situation as

exists.

The gentleman from Rhode Island [Mr. FORAND] mentioned the fact that unemployment had increased by about 42,000 in the past month. There is an article which appeared in the July 8 issue of the New York Times on this subject. subject. The headline reads: "Employment Up 989,000-Most of the Increase on Farms."

But in this article it points out this particular thing, and there are a couple of other sections to which I want to refer, and later on I shall ask permission to insert the whole article in the RECORD.

The rise in unemployment is significantly small because seasonal factors usually increase the total 10 to 11 percent in June, as students and graduates enter the labor market. A 10-percent increase in unemployment would have meant a rise of 334,000 unemployed.

So the actual fact that almost 1 million additional people are employed than were employed last month is a significant feature.

Continuing, this article says:

June brought the first break of any significance in the number of relatively longterm unemployed, those without jobs for 15 weeks or more, which had remained at the 1 million mark since March. In June this

group dropped by about 200,000——

In other words, that is 20 percent-to an estimated 850,000.

That is really the significant figure. The conclusion of the article is that it looks like the peak has been passed, and that our unemployment problem has

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