The Service also has focused its attention on the

conduct of collective bargaining in a number of industries critical to the economy and welfare of the nation. These include energy, health care, construction, food, and the public

sector.

The Service targets these industries because they have an important impact on the economy. In FY 1979 the Service will intensify its contacts with these industries, and its involvement in contract negotiations. FMCS can then give priority to monitoring the progress of these negotiations for signs of possible trouble. Through early and active involvement by the Service, strikes in these critical industries can be avoided.

As you know, more than three years ago FMCS was given special responsibilities for mediating labor-management disputes in the health care industry. Our caseload in this sector is rising. It is a role we still are adjusting to in an effort to find ways to be more effective. For example, we are having problems with court interpretations of the law with respect to the time when a Board of Inquiry can be named in stalemated disputes. It is possible that we may have to seek a change in

the law.

Last summer, we abolished the health care advisory committee both on the recommendation of the Office of Management

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and Budget and our own assessment that the committee was not fulfilling the function for which it was set up. Recently, however, we opened what we hope will be continuing discussions with the major unions and employers in the health care industry as to what mechanism might be most feasible for joint discussion of the problems in the industry.

In the food industry, FMCS has a mediator who is a permanent member of the Steering Committee of the Joint LaborManagement Committee of the Retail Food Industry. This Committee is actively involved in the prevention and settlement of labor

management disputes, and has as a chief goal the restructuring

of collective bargaining in the industry.

During FY 1979, an estimated 2,500 contracts will ex

pire in the construction industry. FMCS anticipates its mediators will be heavily involved in the bargaining process.

About 2.7 million of the 5 million workers employed

in the construction industry are union members. However, the nonunion sector of the industry is becoming increasingly competitive and is making significant inroads into the jobs heretofore performed by the unionized crafts. This competition is forcing union negotiators in some cases to accept smaller wage increases or no increases at all. Changes in work rules, long a tightly

guarded province of construction unions, are being written into

new agreements as the unionized trades seek to accommodate to the changing economic conditions and preserve their work juris

diction.

A high volume of construction activity is expected in

construction.

FY 1978 and 1979, with a shift from residential to nonresidential The unionized trades have traditionally exercised greater job control in the nonresidential area. These circumstances may take some of the pressure off the unions to make further concessions on wages and work rules. But because con

tractors have been getting used to winning concessions, this development could be accompanied by an increase in the number of the industry's work stoppages. It will certainly lead to harder bargaining.

To forestall this and to increase cooperation of labor and management in the industry and preserve existing collective bargaining relationships, FMCS is encouraging the establishment and continuation of labor-management committees that deal with the special problems of collective bargaining in this industry. As you know, Executive Order 11491 establishing collective bargaining in the federal sector was signed in 1969, writing FMCS into that procedure. The federal sector is the fastest growing component of our program. It has tripled since FY 1973. The need for more highly qualified mediators in this field is becoming more acute all the time.

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To make sure we are prepared to meet this need, we are going to step up the training of our mediators. We have brought 36 mediators into Washington this week for a weeklong training workshop in federal sector collective bargaining. We have consulted with employers and unions in the federal sector to help us design this intensive training course.

Once these mediators go back into the field, they will be fed a constant stream of specially-prepared information on developments in the federal sector. This training process will

be repeated for our entire staff.

The Service's technical assistance program includes a wide range of preventive-type activities designed to develop deeper understanding of the collective bargaining process by both parties prior to the expiration of the contract.

By the end of the current fiscal year, the Service will have participated in and closed nearly 1,300 technical assistance (TA) cases covering all sectors of the economy. TA activities include assistance in forming or participating in area and industry labor-management committees, conducting foreman-steward training programs, consultation and liaison work with company and union officials, and conduct of the new and highly successful "Relations by Objectives (RBO)" program developed by the Service.