Source: War Manpower Commission Reports and Analysis Division, September 13, 1945.

SOME EMPLOYERS HERE EXPLOIT VETERANS AT LESS THAN LIVING WAGE, MCDERMOTT SAYS1

A substantial minority of employers here is taking advantage of unskilled vet erans by offering them jobs at less than living wages, Col. Arthur V. McDermott, Director of the Selective Service System in New York, charged yesterday as he noted that within 6 months the local labor market would be swelled by 600,000 discharged soldiers and sailors.

Speaking at a luncheon of the Advertising Men's Post, 209, of the American Legion, at the Hotel Lexington, he made it clear that he was concerned with what was happening now to "graduates" of the draft.

Before the end of the war, Colonel McDermott said, the Veterans Personnel Division of Selective Service headquarters at 1 East Forty-fourth Street was achieving "pretty good results" in helping place untrained veterans. But at present, he reported, "some employers, apparently imbued with the idea of a surplus supply of labor," were apparently trying to put ex-servicemen to work at $24 to $26 a week. "If the attitude of these employers, who are trying to take advantage of the desperation of unskilled veterans, keeps up we will be in a horrible state of affairs," he warned. "It is a terrible reward to give a man who has served from 2 to 5 years a job at $25 a week. How can he possibly support himself and his family in New York on that kind of money?"

Colonel McDermott said the Veterans' Personnel Division now was handling 600 returning veterans every day and predicted that the number would soon rise to 800.

"It's really terrific, and I am getting worried as to whether we are reaching the saturation point," he commented.

He painted a more optimistic picture of the job opportunities for veterans in the white-collar and professional fields and suggested that business could help Selective Service and the United States Employment Service by setting up industrywide centers for registering, screening, and placing former servicemen. Colonel McDermott said New York City was now inducting 3,000 men a month into the armed forces, 90 percent of them 18 or 19 years old.

EXHIBIT 82

STATEMENT IN SUPPORT OF 65-CENT MINIMUM WAGE AND OTHER PROPOSED AMENDMENTS TO THE FAIR LABOR STANDARDS ACT AS PROVIDED FOR IN SENATE BILL 1349

Submtted to the Senate Committee on Education and Labor on behalf of the Amalgamated Clothing Workers of America by Gladys Dickason, research director, October 26, 1945

INTRODUCTION

The combined branches of the men's apparel industry represent a major manufacturing industry, employing as of 1959, more than 350,000 workers' Somewhat more than three-fourths of all workers in the industry are members of the Amalgamated Clothing Workers of America.2

For more than 30 years, the Amalgamated Clothing Workers of America has represented workers in the men's apparel industries in their united effort to obtain improvement in their conditions of work. During 22 of those 30 years and more. the union has had detailed and comprehensive experience with the effect of unregulated competition with reference to minimum-wage levels on living standards, on the purchasing power of garment workers, on employment, and on business stability in the industry.

During 9 years of its history, the union has known intimately and in detail, the effect of Nation-wide minimum wage floors on the industry and on the earnings and job opportunities of workers in the industry.

1 Source: New York Times, October 10, 1945.

1 Men's and boys' suits and overcoats, separate trousers, shirts, pajamas, underwear, mackinaws and other heavy outerwear, overalls, work shirts and work pants, neckwear, robes, and gloves.

2 The Amalgamated Clothing Workers of America has a large additional membership in allied industries.

EXPERIENCE IN MEN'S APPAREL INDUSTRY WITH EFFECT OF PREVIOUS WAGE FLOORS THROWS LIGHT ON PROBABLE EFFECT OF 65-CENT MINIMUM

Experience in the men's apparel industry with the effect of minimum wage levels heretofore established throws a strong light on the probable effect of the proposed minimum of 65 cents, not only on this industry alone, but, also, no doubt, on other industries where a 65 cent minimum would require a substantial increase in wages in individual plants or in specific sections of the industry. This is so because few, if any, other industries have suffered chronically from so low a wage scale as has prevailed in certain branches of the men's apparel industry in the absence of minimum-wage legislation. Few, if any, other industries have been required to make such drastic increases in wages as were necessary, in 1930 to 1935, and in 1938 to 1941, in individual plants or industrial branches in the men's apparel industry, to comply with minimum wage rates established.

INCREASE TO 65 CENTS MODEST COMPARED TO PREVIOUS INCREASES REQUIRED

An increase in the minimum wage to 65 cents per hour at the present time will involve a smaller increase in wage rates in manufacturing industry generally than was required by the adoption of the President's reemployment agreement and the NRA codes in 1933 and 1934. The spread between the minimum rates established at that time and the then prevailing average hourly earnings (42 cents) was not as great as the present spread between a 65-cent minimum and existing average hourly earnings (97 cents).

Not only is this true of manufacturing industry generally, but it is also true of the lowest paid industries. The increase in wage rates required for the establishment of a 65-cent minimum will be much less, for the industry now paying the lowest wages, than the increase which was required for the lowest-paid industries in 1933, or individual firms in 1938 when the Fair Labor Standards Act was passed.

The cotton garment branch of the men's apparel industry, with average hourly earnings of 19.3 cents in March 1933 was among the manufacturing industries paying the lowest wages at that time. With the adoption of NRA minima of 30 and 321⁄2 cents per hour, earnings rose to 35.6 cents per hour, an increase of 84 percent by February 1934. With a further increase in minimum rates late in 1934, earnings in the industry rose to 41.9 cents per hour in February 1935. Within this short period hourly earnings in this industrial branch were more than doubled.

Despite this large increase in wage rates, production and employment increased and the number of business embarrassments declined.

The improvement recorded in employment, earnings, and production in the cotton-garment industry after the adoption of relatively high minimum wage rates was also recorded in the lowest-paying areas of the men's clothing industry (the manufacture of suits and overcoats). In eastern Pennsylvania (exclusive of Philadelphia) average hourly earnings of clothing workers were 21 cents per hour in 1932. The introduction of the 40-cent minimum in 1933, with provision for minima of $1 per hour for cutters and 75 cents for offpressers, doubled wages in the area. Employment increased. The same development occurred in New Orleans where average hourly earnings had been approximately 16 cents per hour and were also doubled during the NRA period. The increase in wages was accompanied by an increase in employment.

Average earnings in individual plants were as low as 15 cents per hour in 1937, the year prior to the adoption of the Fair Labor Standards Act. Compliance with the 25-cent minimum therein provided for required increases of not less than 66% percent in such plants. Plant average wages as low as 15 cents per hour were reported by the Women's Bureau of the United States Department of Labor in the dress-shirt industry in Tennessee in 1937. Employment in the dress-shirt industry in that State was approximately twice as high in 1939, subsequent to the enactment of the Fair Labor Standards Act, as it had been in 1937 when no minimum was in effect.

Increases of as much as 100 percent in 1933 and 66% percent in 1938, have been instituted to comply with the minimum wage provisions, and whether industrywide (as in cotton garments) applicable only to particularly low-wage areas within an industry (clothing industry in eastern Pennsylvania and New Orleans); or on an individual firm basis, such increases have not adversely affected employment. That is the record.