wage bill from loss of

premium

overtime

TABLE XXV.-Cost effects of 65 cent minimum wage, manufacturing industries [Wage data: Annual rates, on June 1945]

Reduction in

Source: Wage cost data-Bureau of Labor Statistics; profits data-OPA estimates. Division of Re search, Office of Price Administration.

TABLE XXVI.-Corporate profits in manufacturing and mining, all corporations

Source: Sales: Data for 1939-42 from Statistics of Income; data for 1943-44 are estimates based on the relations of sales in 1942 for the OPA sample to total sales for all mining and manufacturing corporations. An adjustment was made to eliminate the effect of renegotiation.

Net worth: Data for 1939-41 from Statistics of Income, adjusted to include returns without balance sheets; data for 1943-44 were obtained by adding estimated retained profits to the net worth at the end of the previous

year.

Profits: Data for 1939-42 are from the Statistics of Income; the 1943 figure from 1942 data on basis of the Treasury estimate of 1943 profits of all corporations; 1944 figure on the basis of available samples of 1944 profit experience. Adjustment made to eliminate the effect of renegotiation.

Source: WPB General Economic and Planning Staff, American Industry on War and Transition, 10

D. 43.

TABLE XXVII.-Indexes of average hourly earnings, output per man-hour, and unit labor cost, all manufacturing industries combined, 1919–41

1 Based on 1932-41 hourly earnings data published by the Bureau of Labor Statistics and 1919-31 hourly earnings data estimated by Witt Bowden of the Bureau of Labor Statistics.

Derived from data published in Productivity and Unit Labor Cost in Selected Manufacturing Industries, Bureau of Labor Statistics. Computed as the quotient of the index of average hourly earnings and the index of output per man

hour.

EXHIBIT 77

STATEMENT OF REID ROBINSON, PRESIDENT, INTERNATIONAL UNION OF MINE, MILL AND SMELTER WORKERS, CIO, IN SUPPORT OF S. 1349, OCTOBER 1, 1945 The International Union of Mine, Mill and Smelter Workers regards S. 1349 as an integral part of a necessary program to bring about a really effective tra sition to a peacetime economy. The other complementary and equally essentisi aspects of that same program are the Murray full-employment bill, the KilgoreForand unemployment-compensation bill, the Wagner-Murray-Dingell bill extending social-security benefits, the equal-pay bill (S. 1178) and the permanent FEPC bill. This is the program by which our course for the future must be guided if we are to achieve a full-employment economy and avoid a reversion to bread lines and apple selling.

Our interest in this legislation is twofold. First, it does directly affect a portion of our membership-a relatively small but nonetheless significant portion Second, it indirectly affects all our members insofar as it seeks to sustain purchs ing power in periods of threatening deflation, thus contributing to the maintenance of demand for products made by our members.

A. SUBSTANDARD WAGES IN MINING AND NONFERROUS METAL INDUSTREIS

The Mine, Mill and Smelter Workers represents about 150,000 workers engaged in mines (other than coal), mills, smelters, refineries, brass mills, fabricating plants. and nonferrous casting shops. In practically all segments of our jurisdiction the efforts of our union have succeeded in raising minimum rates fairly well above the 65 cents an hour sought in the present bill. There still exist, however, severa "sore spots" in which minimum rates have not yet reached this level. The particular spots are a cause for concern to us; they operate as a drag upon the rest of the industry and constitute a perpetual threat to standards achieved ther Instances of such substandard spots within our jurisdiction are (1) iron-ore minis in Southeastern States, (2) nonmetallic mining, and (3) isolated smelters and refineries.

1. Iron-ore mining.-In iron-ore mining, virtually all important mines in the southeastern area, comprising the States of Alabama and Georgia, are now ganized by our union. The distribution of average hourly earnings, includ overtime and incentive earnings in October 1943, among workers in iron ore minis in this area is shown in table 1. The figures are based upon a study made by t Bureau of Labor Statistics and are the latest available information for that dustry.

TABLE 1.-Distribution of workers by average hourly earnings in iron mining in Southeastern States, October 1943

As shown by the table, slightly over 14 percent of the workers, at the time of the study, averaged less than 64 cents an hour, including overtime and inventeiv premiums. In terms of base rates, there were probably more than 25 percent in the under-65-cent category. Since then, we have succeeded in gaining some slight improvements but today base rates of less than 65 cents are still common in the industry in that area. In October 1943 average hourly earnings for the industry in this section of the country were 80.4 cents, as compared with 102.9 cents in the West, 95.6 cents in the Lake Superior region, and 90.0 cents in the Northeast Region.

2. Nonmetallic mining.-Some of the lowest rates found throughout our jurisdiction are those existing in the mining and quarrying of nonmetallic minerals such as limestone and phosphate in the South. Each of these raw chemicals had important wartime uses. Limestone, for example, enters as an important ingredient in many chemical and metallurgical processes; phosphate, similarly, forms the basis of a vast fertilizer industry and has other important chemical uses. The production of these materials suffered considerably in wartime because of manpower shortages arising out of a substandard wage structure.

While no recent studies of wage rates in these fields are available, we know from our own experience, that only a few years ago, rates of as low as 25 and 30 cents an hour were common in that area. Through organization and successive negotiations and War Labor Board cases we have succeeded in raising minimum rates in these fields to present base rates of 50 and 55 cents an hour.

3. Smelting and refining.-Wages in smelting and refining of nonferrous metals are, as manufacturing industries go, relatively high. It is all the more surprising, therefore, to find in the copper industry for example, that two of the most financially powerful corporations in the country persist in the payment of substandard wages that are completely out of line with wages paid in the rest of the industry as well as with wages paid by themselves in other parts of the country. In El Paso, Tex., the American Smelting & Refining Co., at its smelter, and the Phelps-Dodge Corp., at its refinery, have similar wage scales based on entrance minimum rates for common labor of 604 cents an hour. In 1941 the common labor rate was 40 cents an hour and successive increases since the war have brought this rate up to its present level. There still exists, however, a marked disparity between El Paso and other areas, including the contiguous areas of Arizona and New Mexico. These contiguous areas, until recently, were considered part of the same wage area as the El Paso district. Today, however, the War Labor Board has set $5.88, or 73.5 cents an hour, as the base rates for major operations in New Mexico and Arizona; because of a completely arbitrary and totally illogical geographical differentiation, however, these rates are not applied to El Paso.

The extent of the discrimination practiced against workers in El Paso is made evident by the following tables, showing common labor rates paid in copper smelters and electrolytic refineries throughout the country, including those at El Paso.

TABLE 2.-Common labor rates paid by copper smelters in the United States

1 Rate ordered by National War Labor Board and now in process of appeal by company.

TABLE 3.-Common labor rates paid at electrolytic copper refineries in the United

States

One other glaring instance of substandard wages in our industry is seen in the Texas Mining & Smelting Co. antimony smelter at Laredo, Tex. After over 2 years of processing of cases before the War Labor Board, wage scales are still far below anything in the industry. This company operates the world's largest antimony smelter. Since March 1, 1942, over 200 of the 400-odd employees a the plant have been paid less than 49 cents an hour. In January 1945 the regional war labor board ordered all rates below 50 cents an hour increased up to 50 cents an hour. More recently the National War Labor Board, on the basis of an appes by our union, raised the minimum rates to 55 cents an hour. To date, the company has not complied with this order.

By contrast with the rates paid in Laredo, the Coeur D'Alene area, which ranks second to Laredo in the production of antimony in this country, pays 90.5 cer for common labor. The same Texas regional war labor board which set the minimum rate at 50 cents an hour has set the minimum of the common laber bracket for the zine smelting industry at 78 cents an hour. There is an extreme. close similarity between conditions and processes in both of the industries, much so that only an expert could detect any differences in either raw materials used or in the finished product. The extreme heat in which operations in antimony smelting are performed makes it essential that workers lay off 24 hours between shifts; as a result of this schedule the maximum time that a worker can work is any 1 week is 40 hours for which they receive the unbelievable wage of $18.80, before deductions.

B. EFFECTS OF SUBSTANDARD WAGES ON THE WAR EFFORT

The existence of substandard wage rates, in the instances cited above, was one of the major factors contributing to extreme manpower shortages that hampers production of critically needed minerals and metals during the war. In El Pas for example, both the A. S. & R. smelter and the Phelps Dodge refinery operate shorthanded throughout most of the war period. Similarly, in limestone ar phosphate mining and quarrying, manpower shortages were ever present problems through the war period.

Antimony, even before this country was drawn into the war, was classified as a strategic raw material by the Army and Navy Munitions Board. The mos important uses of this metal are in the manufacture of storage batteries, bab metals employed in bearings and the manufacture of chemicals. The shutting of

of foreign supplies and our dependence upon domestic production made the Texas smelter a key production spot in the war program. The difficulties encountered in securing adequate manpower for this plant-difficulties arising mainly from the obsolete wage structure in existence-finally caused the intervention of both the War Manpower Commission and the War Production Board in an effort to secure expedition of our case before the War Labor Board. After over 2 years of processing, their recent order raising wages is now pending before the Office of Economic Stabilization for their approval.

C. EFFECTS OF SUBSTANDARD WAGES ON THE WORKERS

An abundance of evidence has already been presented at this hearing showing the inadequacy of rates below 65 cents an hour for the maintenance of decent living conditions. The Department of Labor has concluded that a minimum wage of 60 to 80 cents an hour will be necessary to provide a subsistence standard of living for unskilled workers. This union is not prepared to concede that the 65-cent minimum provided for in the bill now under consideration can provide such a standard of living; however, we are willing to support this measure as an important first step toward achieving a more equitable wage structure.

The Bureau of Labor Statistics, in its study Estimated Intercity Differences in the Cost of Living estimated that the cost of living of a 4-person manual workers' family at a maintenance level in Birmingham, Ala., in June 1943, would be $1,590.17, or the equivalent of 80 cents an hour on a 50-week, 40-hour basis. Birmingham is the city closest to the Alabama iron ore area in which our members work. If allowance is made for the increases in the cost of living that have taken place since the date of that study, then the comparable figure for July 1945 would be about $1,697.17, or about 85 cents an hour. The lowest figure for the cost of the maintenance budget for any large city in June, 1943 was $1,496.50 for Mobile, Ala., which figure amounts to about 75 cents an hour on the same 50-week, 40-hour basis.

It has been recognized time and again that the effect of substandard wages is to exact a heavy toll on the physical and mental health of the American people. The Department of Agriculture, reporting on the results of a study of family food consumption in the United States in 1942, conducted by the Bureau of Human Nutrition and Home Economics and the Bureau of Labor Statistics, found that * * * the average nutritive values of the diets of families in the lower-income groups were below satisfactory levels in several respects in the spring of 1942.

“宅 * * Not until the income level $1,500–$1,999 was reached did the average values per nutrition unit for the food brought into urban itchens meet the recommended allowances for the eight dietary essentials considered. Approximately 32 percent of urban families had incomes that were below the level at which the average value of family diets met the recommended allowances for all dietary essentials studied except niacin." 1

D. SIXTY-FIVE-CENT MINIMUM AS AN AID TO FULL EMPLOYMENT

The workers under our jurisdiction who would be directly affected by an increase in minimum wages to 65 cents an hour, are, as has been stated above, relatively few. Because of what such a minimum would mean in furnishing a prop to our postwar economy, all of our members have a vital interest in this legislation.

The American people have just lived through the most horrible and devastating war in human history. Out of the needs of that war our economy expanded to dimensions never before realized. Our national income rose from 70.8 billion in 1939 to 160.7 billion in 1944. That expansion meant full employment, and despite scarcities and shortages of many items a greater net flow of civilian goods than had been reached in the prewar years. Having seen that a full employment economy is possible, our people insist on nothing less in peacetime. Such an economy will mean greater job opportunity, better health and medical care, better housing, a greater measure of social security and the like.

The realization of such an economy, we know, will depend on the maintenance of an aggregate demand sufficient to support the full flow of goods and services that will be needed. By far, the largest constituent element of aggregate expenditure is private consumption, or what is more generally known as purchasing

power.

U.S. Department of Agriculture. Family Food Consumption in the United States, Spring 1942. Miscellaneous Publication No. 550. Spring 1942.