VIII. OTHER EXPENSES The estimate for the study of the guaranteed wage plans, and for the processing of social security records, include allowances for expenses other than personnel. Estimates will now be made as to the costs other than personnel for the other parts of the study. It is assumed that the economic analysis of guaranteed wage plans will be done by the consulting economists in their usual offices and that, except for some travel expense, there will be no other nonpersonnel expense for that part of the study. The estimates respecting personnel given above relate to the aggregate number of man-years, and not to the number of persons. The number of persons in the several divisions is indicated in the following tabulation: The major cost of travel will be involved in the interviews of outstanding firms, for the purposes of the stabilization study. It is estimated that 160 man-weeks will be required for those interviews; and that other travel will run to 10 man-weeks. The total is put down as 3.3 man-years. Travel and per diem per man-year is estimated at about $2,500, so that the aggregate is $8,250. Subsection 2. Transportation of things. An arbitrary estimate of $100 has been entered for the transportation of things. Subsection 3. Communication services and penalty mail Communication services have been estimated at $1,875, which includes provision of 1 station and 2 extensions for each group of 3 in a staff of 75 at $9.50 per month, or $1,275, plus $100 a month for wire and long-distance telephone service, or $600. Penalty mail is estimated at $750, which will cover 50,000 pieces of mail at $15 per thousand. Subsection 4. Supplies and materials At a rate of $50 per person per year, supplies and materials for 75 persons will amount to $1,875. Subsection 5. Other contractual services In order to make effective use of the various reports of the Bureau of Labor Statistics and the Social Security Board, it is likely that the sheets on which the data are recorded will have to be reproduced. Our estimate for this service,. plus the mimeographing, moving, and other services needed, is $1,500. Subsection 6. Printing and binding The main item under printing and binding will be the printing of the various: reports. There will be two reports on economics of guaranteed wages, onereport on interrelations of guaranteed wages with other economic measures, a monograph on experience with guaranteed wage plans, four monographs on. the stabilization problems of the industries studied, including a report on cost,. and one over-all report. At an average cost of $500, total printing and binding: will come to $4,500. Subsection 7. Equipment Equipment has been figured at $150 per desk, which would amount to $11,250 for 75 persons. Since the equipment will be surplus property, however, it has. been listed at $5,832, which represents a purchase price slightly higher than 50 cents on the dollar. IX. SUMMARY The total cost as estimated here is as follows: Part I. Analysis of specific experience with guaranteed wage plans: Guaranteed wage study. Bureau of Labor Statistics_ $6,642 $51, 642 Part II. An analysis of the methods and possibilities of regularizing production and stabilizing employment.. 101, 810 Part III. Exploration of cost of guaranteeing wages: Guaranteed wage study. Social Security Board.. $4,879 25, 309 Part IV. Analysis of economics of guaranteed wages.. 11, 017 Total____ Other expenses: Travel - Transportation of things. Communications___ Penalty mail____. Supplies and materials__. Other contractural services. Printing and binding- Equipment. Grand total____ 18, 480 225, 318 $8, 250 750 1,875 1,500 4,500 5,832 24, 682 250,000 50,000 200, 000 Amount provided from "Salaries and expenses, Office of War Mobilization and Reconversion". Estimated appropriation__. Mr. LUDLOW. We would be glad if you would give us a résumé of the estimate statement in your own way. NEED FOR JOB SECURITY AND EMPLOYMENT STABILIZATION Mr. JOHNSTON. As you know, Mr. Chairman, I am speaking in behalf of the Advisory Board of the Office of War Mobilization and Reconversion. The Board is composed of Mr. Philip Murray, Mr. William Green, and Mr. T. C. Cashen, from Labor, Mr. Edward A. O'Neal, Mr. James B. Patton, and Mr. Albert S. Goss, from Agriculture; Mr. Chester C. Davis, Mrs. Anna Rosenberg, and Gov. O. Max Gardner, the Board's chairman, are the public members; the three members from business are Mr. G. H. Mead, Mr. Nathaniel Dyke, Jr., and myself. The Board has unanimously gone on record in favor of a study of the so-called annual wage. One of the many problems that faces our country at this time is the impasse between management and labor, which is causing industrial unrest. I think this is an explosive force within our economy, even more so than the atomic bomb, because that is something in the distance, and this is with us today. One of the greatest causes of industrial unrest is job insecurity. Large numbers of our workers only work spasmodically. They do not have permanent employment. It is frequently impossible, and I can say this as an employer, to give continuous employment, or to give job security, because our production is dependent upon the consumers buying our product. This job insecurity causes slow-downs as workers do not want to work themselves out of a job. It causes workers to demand higher wages than perhaps they would if they had steady employment. Great numbers of American workers, most of them in fact, work less than 200 days in a year. But they have to live for 365 days. So, in order to provide the means for doing anything which can be done to give continuous and stabilized employment, the War Mobilization and Reconversion Advisory Board would like to make a study of the whole problem. I think it will be particularly important in the years to come. There are many firms that now have stabilized employment. For instance, there is Procter & Gamble, soap manufacturers in Cincinnati, and also the Hormel Co., meat packers, in Austin, Minn., who make the famous Spam, the Nunn-Bush Shoe Corp., and many others who have stabilized employment so that the workers realize that they are going to have steady jobs. Most of our industries have not done it, and most of the industries feel they cannot do it. Our problem is to make a study to see whether an annual wage, or continuous employment as I prefer to call it, can be provided for more American workers. One industry frequently stabilizes another industry. For instance, if you can regularize production of automobiles and the construction industry, you can stabilize the steel industry. But it would be impossible for the steel industry to give its workers an annual wage, or continuity of employment, if its customers, the automobile industry, the construction industry, and other industries, are not buying steel. So we find this problem: One industry can regularize its employment, but its ability to do so depends a great deal on other industries being able to do so. The whole problem, we think, should be carefully studied, to find means and methods of regularizing employment and to make greater continuity of employment. If such information can be gathered, it will assist industries in regularizing their employment. This study includes both past and present stabilized wage plans. While there are a number of them in existence, many others have been abandoned as failures. We should study those which have been failures and find out why. We should also study those in existence and find out why they are successful and whether they can be adopted by other industries in the same line. We should study carefully the cost of stabilizing employment, and also the question of the economic value of guaranties and their relation to other measures to provide stable employment. One of the most important things we can do in America is to minimize friction between management and labor. It is a problem which will grow worse with greater industrialization, and it is a problem which will become more intensified with greater technological advancement. It is a problem which should receive the careful con sideration of some impartial group, such as the War Mobilization and Reconversion Advisory Board. This is a problem which affects many sections of our economy and its study is very worth while. The amount of money here requested is not large in comparison to the benefits that may accrue from the study. We spend billions of dollars on war. But if we can only avoid or minimize industrial warfare here at home we will have gone a long way. In my own personal businesses I have experimented with giving continuity of employment. I have found, for instance, that when I guarantee men 90 days of continuous work in a year, I get more and better work from those men and have better relations with them because they are not fearful that they will be laid off next week or next month. The question of steadier employment depends on management getting the materials there on time, upon proper coordination of purchases and sales, upon pushing specific items in dull periods, as well as through so-called boom periods, and upon producing other items which can be made to fill in the dull periods of normal unemployment. Those are important problems and should be carefully studied by all management so that they will understand them, because the stabilization of production is one factor in our economic picture which tends to stabilize other factors. But we do not know all of the interrelationships between these factors, and we do want to study them and make that information available to management, to labor, and to agriculture. I might say that agriculture, represented by Mr. Goss, Mr. O'Neal, and Mr. Patton, is much interested in this whole problem, along with management and labor. They want to find out if there are means and methods by which we can stabilize employment. If industrial employment can be stabilized agriculture will benefit. NEED FOR GOVERNMENT COLLABORATION IN WAGE STABILIZATION PROGRAM Mr. LUDLOW. Mr. Johnston, you are the distinguished head of the United States Chamber of Commerce. Has the Chamber of Commerce ever engaged in studies of this character? Mr. JOHNSTON. Yes, we have, in a very brief way, but nothing comprehensive at all. Mr. LUDLOW. Has industry as a whole undertaken such a study? Mr. JOHNSTON. No, it has not. Mr. LUDLOW. Could this study, in your opinion, be prosecuted by industry without a governmental subsidy? Mr. JOHNSTON. I do not think so, because I think if industry did it alone, our findings might not be regarded as impartial. Mr. LUDLOW. I mean by the collaboration of industry with labor, for instance. Could an arrangement be worked out to make these studies without a governmental appropriation? Mr. JOHNSTON. It is possible it might be done, although nothing has been done in that way. It would require the setting up of an impartial board, that would be difficult, in views of the conflicting interests of management, labor, and agriculture. I think the War Mobilization and Reconversion Advisory Board is the ideal board to do it. Mr. LUDLOW. You think Government sponsorship would give them more character and prestige? Mr. JOHNSTON. Yes, and it is tremendously important that this report be entirely nonpartisan and without bias. Labor is depending a great deal upon this. It is one of the programs in which the labor organizations are interested because it gives them a somewhat different viewpoint. Agriculture is interested in it, also. I think this joint body of leaders on our advisory board can make an impartial study. Mr. LATIMER. The Government is already in possession of an enormouse amount of material that could be used in the prosecution of this study. And unless the confidential records of the Government can be thrown open to business and labor generally the cost would be a great many times this $200,000. EXAMINATION OF SPECIFIC EXPERIENCE WITH GUARANTEED WAGE PLANS Mr. LUDLOW. In the presentation before us the objective is set forth very clearly in six subdivisions. I wonder if we can take up each one of those and ask about it. The first is an examination of the specific experience with guaranteed wage plans. Could you give us some comment on each one of these? Mr. JOHNSTON. Yes. There have been a great many attempts to regularize employment. I like that term better than I do an "annual wage plan," because that is what we are really trying to do, to give continuity of employment. There are over 500 of these plans already in existence. I mentioned a very few of them. We want to study those and get information about the experience in new methods which are now in operation. ANALYSIS OF METHODS AND POSSIBILITIES OF REGULARIZING PRODUCTION AND STABILIZING EMPLOYMENT Mr. LUDLOW. The second specification is an analysis of the methods and possibilities of regularizing production and stabilizing employ ment. Can you give us a few words about that? Mr. JOHNSTON. These 500 plans approach the employment problem from different aspects. Some do it in one way and some in another way. Mr. Hormel is an illustration. Under his plan he guarantees everybody in his organization 2,000 hours of work a year. If it falls to less than 2,000 hours he pays the 2,000 hours. If they go over 2,000 hours he pays them for the time over 2,000 hours. They have a guarantee of 2,000 hours a year, which is very regular employment. That is one problem. Then the Nunn Bush Shoe Co. takes an entirely different approach. These should be studed in relation to the industries they serve. There are other elements involved in the companies giving continuous employment. MEASURE OF COST OF VARIOUS TYPES OF JOB GUARANTEES Mr. LUDLOW. Your third objective is a measure of the cost of various types of job guarantees. Can you give us a brief comment on that? |