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the ship, janitors and folks who do that kind of work-who would be particularly affected by the minimum, but once you raise those fellows you have to raise everybody else.

Mr. PATTERSON. Everybody has always given that same testimony, but it is not always true. It works the opposite in many cases. Sometimes the minimum tends to become the maximum in many cases, and they do not go much beyond it. I wish it were true.

Mr. GEELAN. In other words, do you contend that we are getting away from the original premise of the Wage-Hour Act when we raise the minimum to 65 cents an hour, which would mean that you are in disagreement with the theory that the 40 cents presently true, so far as the minimum wage is concerned, is no longer realistic because of the increase in the cost of living?

Mr. LAWRENCE. I think probably our minimum in the lowest territories, our lowest minimum in most cases-well, there are some little country lines, probably. Those are the folks for whom you have to watch out. The larger lines operating between main points naturally pay a higher wage. They are more in competition with what we call the protected plants working on Government contracts, where they pay any money to get people. Our folks had to compete with that to hold their men. But you affect a large number of these little, small carriers in the country areas that run from a small town into some central point where freights interchange with the larger lines.

We are not objecting to the setting of a minimum wage. We are just trying to point out that we do not know what we are going to use for money, and possibly in the South even the lowest minimums may be a few cents over the 40 cents now, through competition, but I do not think they run anywhere near the 65 to 75 cents proposed in these bills.

Mr. PATTERSON. Have you any figures-I do not want any opinion statement-of how much this bill would be reflected in increased rates that you would have to charge?-A lot of people have brought in figures and said they would have to increase their rates to a certain amount. We found out that the over-all figure in the United States, I think, by increasing wages 20 or 30 percent, would be only about 7 to 812 percent increase, and not the whole amount at all.

Mr. LAWRENCE. This is our position, Mr. Patterson, and I pointed it out probably before you came in. For manufacturing, 15 percent of its take in dollars is involved in pay roll.

Mr. PATTERSON. I think the committee ought to have figures on everybody that testifies.

Mr. LAWRENCE. I have given our picture here in the testimony marked with my name, the point that 47.1 percent of these 1,400 carriers reported on to the Commission, of their revenue dollar goes into pay roll. The chairman pointed out that that might-

Mr. PATTERSON. That would not be reflected in the rates to that extent. It goes to the pay roll, but not in the reflection in the rates. The reflection in rates involves gasoline, depreciation, overhead, and a lot of other things.

Mr. LAWRENCE. What I am trying to point out is, if you apply a 10 percent increase in pay roll to a pay roll that amounts to 15 percent of your total revenue, it is only a 12-percent increase, but when you apply a 10-percent increase to 50 percent, it is a 5-percent increase.

Mr. Hook. Does not the Interstate Commerce Commission fix your rates?

Mr. LAWRENCE. Mr. Hook, it does not exactly fix them. They are given power to control them, and when a rate is filled and there is a protest they will suspend it. Well, of course, every increase, usually, is protested and suspended and put under processing.

Mr. Hook. Would this not be an argument before the Interstate Commerce Commission on the question of rates?

Mr. LAWRENCE. But, as I tried to point out, Mr. Hook, before bodies like that the patient has died before you have any action, because we have one case before the Commission for an adjustment of rates now. Six years ago it was set down for hearing and no hearing has been called yet. So sometimes you have redress, but the patient has already died.

Mr. PATTERSON. It is almost as slow as Congress.

Mr. Hook. In other words, you want this committee to enter into the rate situation.

Mr. LAWRENCE. No; we are just pointing out our difficulties.

Mr. WELCH. I would like to ask Mr. Lawrence a question. How many men employed by the members of your organization are paid less than the 65 cents per hour as provided in the bills under consideration?

Mr. LAWRENCE. In certain territories; yes, sir.

Mr. WELCH. No; how many men employed by your organization are receiving less than the 65 cents an hour provided for in these bills?

Mr. LAWRENCE. Mr. Welch, I would have to say we could not give you an exact figure at this time; as I tried to point out earlier, it was just short of 25,000 of those carriers subject to the Interstate Commerce Act, and there are at least another 25,000 subject to State commissions, and there you can see that we are not in a position of an industry with 100 member companies that we can query. It is really a never-ending task, checking out those men and the constant shifts.

Mr. WELCH. How many associate members are there in your organization?

Mr. LAWRENCE. We have, I would say, upward of 30,000. You see, our members are members of State associations. Our name is plural, which indicates we are a federation of some 53 organizations.

Mr. WELCH. You cannot state even approximately how many men would be affected by either of those bills if enacted into law?

Mr. LAWRENCE. I would hesitate to do it. We could, probably, after months and months of study.

Mr. GEELAN. How do you know it would affect you, then? How do you know there are any people earning less than that?

Mr. LAWRENCE. Because we have union contracts. The union contracts cover the skilled type. They do not cover the unskilled. You can only estimate those.

Mr. GEELAN. What is the estimate?

Mr. LAWRENCE. I say, we could estimate those by a long analysis, but it is a long analysis of that number of concerns.

Mr. GEELAN. Where does the opposition stem from, then? You do not know whether it is 1 person or 50 people or a thousand, do you?

Mr. LAWRENCE. You will find, generally, that it will stem, if you might have a concern employing 200 people, from half a dozen in that concern that would be affected by it.

Mr. GEELAN. That is what we want to know. It is the only way we can evaluate the importance of your testimony.

Mr. LAWRENCE. But at the same time you are raising them, you are raising all the other scales as well.

Mr. GEELAN. Not necessarily. You have union contracts, you say. Mr. LAWRENCE. Because part of this bill proposes that they be abrogated by proposing that the Administrator be allowed to set up job differentials.

Mr. GEELAN. That does not necessarily mean a contract abrogation. Mr. LAWRENCE. Insofar as the base pay, I would presume it would. Mr. GEELAN. I do not think so. The employer expects the union to live up to it and the union expects the employer to live up to it.

Mr. LAWRENCE. In the Keeling case there was a 48-hour contract, but still these fellows are suing and the courts are upholding them.

Mr. GEELAN. In other words, the contract was made in violation of the law.

Mr. LAWRENCE. By an interpretation of the law.

Mr. GEELAN. All laws have to be interprted if they are taken to

court.

Mr. LAWRENCE. In other words, I pointed out there that the employer had gone on and the union had gone on figuring that these men were mechanics and that mechanics were exempt, but because this man worked on the piece of equipment when it was taken out of the chassis, they included him.

Mr. WELCH. How many were working on that particular piece of equipment?

Mr. LAWRENCE. There were five in that case.

Mr. WELCH. How many would be involved if either of these bills would be enacted into law?

Mr. LAWRENCE. I would estimate, as to mechanics, sir-in other words, in the group we are speaking of here, approximately a million employees are included. They are involved in some 50,000 concerns. I was speaking of the mechanics.

Mr. WELCH. And you have no idea of how many would come under either of those bills if enacted into law?

Mr. LAWRENCE. All of them, in one respect or other, outside of drivers, when you take all these bills as a group.

Mr. WELCH. Do you mean to say that they all receive less than 65 cents an hour?

Mr. LAWRENCE. You take all of the provisions

Mr. WELCH. I am speaking of the 65-cent minimum provided for in all of the bills under consideration.

Mr. LAWRENCE. We will be glad to make estimates and to submit them to the committee as nearly as we can. It is a monumental task, sir.

Mr. WELCH. If you have no idea, I am prompted to ask, without being discourteous to the witness, why you are here complaining of legislation without knowing whether or not it will affect your business. Mr. LAWRENCE. What I am trying to point out is that the minimum wage would affect about 1,000,000 employees, by changing the present differentials.

Mr. WELCH. I am prompted to ask again if there are 1,000,000 men employed by the American trucking associations who are receiving less than the 65-cent minimum provided in this law.

Mr. LAWRENCE. On that, Mr. Welch, I said I would be glad to make our best effort to give you an estimate, or some approximate number that would be affected. As I say, it is an almost monumental task, but we will go right to work on it.

Mr. RAMSPECK. Your argument, as I understand it, Mr. Lawrence, is that if the minimum wage is changed as proposed in these bills, it would result in an increase in the figures above that, so that all of the wages in the industry would be affected eventually.

Mr. LAWRENCE. That is correct, sir.

Mr. WELCH. That does not necessarily carry.

Mr. RAMSPECK. I say that is his argument.

Mr. WELCH. That is his argument, but it does not carry; from our experience after the enactment of the minimum wage law of 1938. It did not affect anyone except those people who were paid under the minimum at the time.

Mr. RAMSPECK. I think that is right, Mr. Welch. However, with the exception of the Norton bill, I think most of these bills contemplate an entirely different system from the one you and I helped pass in 1938, in that they give authority to the Administrator to fix differential wages above the minimum so as to preserve the present spread.

Mr. WELCH. That is going into classifications instead of a horizontal raise.

Mr. RAMSPECK. That is right. That would be quite a different proposition. The original bill only affected one minimum wage. Mr. WELCH. I am glad you cleared that up in my mind.

Mr. RAMSPECK. Some of these bills propose that in addition to fixing a 65-cent minimum, to become 70 and 75 in 2 years, the Administrator could go on above that and, by classification of jobs, spread that increase all the way up the line.

Mr. Hook. In other words, the industry committees are empowered to recommend minimum wages above the statutory limit for key job classifications.

Mr. GEELAN. Is that not in the present bill?

Mr. LAWRENCE. Oh, no. Under the present law, no wage above 40 cents an hour can be fixed by any process.

Mr. GEELAN. In other words, the only power the industry committees have under the present law is to step up the increase to the top minimum in a shorter period of time?

Mr. RAMSPECK. That is right.

Are there any further questions?

Mr. LAWRENCE. I will be glad, Mr. Welch, to try and make the best estimate we can of the number of those paid under 65 cents, and I will be glad to submit, you might say, the wage rates from right around the country, 15 or 20 or 30 localities, as contained in the standard contracts, which will show the other scales as to drivers, mechanics, and so forth. Many of these minimum wage people are not included in those contracts.

Mr. RAMSPECK. Thank you, Mr. Lawrence.

The next witness is Mr. Broadus Mitchell, representing the International Ladies' Garment Workers Union.

STATEMENT OF BROADUS MITCHELL, RESEARCH DIRECTOR, INTERNATIONAL LADIES' GARMENT WORKERS UNION

Mr. MITCHELL. My name is Broadus Mitchell, research director, International Ladies' Garment Workers Union, 1710 Broadway, New York, N. Y.

Mr. Chairman, I have taken the liberty of giving the reporter a brief written statement, which I hope can go into the record, and then I would like to talk very briefly informally.

Mr. RAMSPECK. We will be glad to have that. (The matter referred to is as follows:)

STATEMENT OF BROADUS MITCHELL, RESEARCH DIRECTOR, INTERNATIONAL LADIES' GARMENT WORKERS UNION, BEFORE HOUSE LABOR COMMITTEE, OCTOBER 26, 1945

The 65-cent minimum is essential at the present time in order to have full employment and production. Throughout the past few decades, output per man-hour has increased; but the failure of production to increase as worker productivity increased has resulted in slack employment and partial utilization of plant capacity. In order to insure that output will expand as worker productivity increases, it is necessary to pay labor a wage sufficient to maintain a level of purchasing power and consumption conducive to full production. Our return to a civilian economy has entailed losses in overtime and various bonus payments in addition to down-grading and loss of jobs. Unemployment has risen and may continue to rise to greater proportions. To compensate for these losses during reconversion and thereby maintain the purchasing power of our working population, we have to decide now between raising wages to a salutary level or public spending on relief, public works, etc. It is appropriate at the present time to limit our national debt by avoiding public expenditures on relief and public works; and to sustain purchasing power through an adequate minimum wage so that we will not suffer another depression with its concomitant loss of national income.

WAGES PAID TO GARMENT WORKERS IN THE WOMEN'S APPAREL INDUSTRY ARE SUCH THAT THE INTRODUCTION OF A 65-CENT MINIMUM CAN BE ABSORBED WITHOUT DIFFICULTY

Average hourly earnings in the major branches of the women's apparel industry are already far above the proposed minimum. The highest paid workers, those in the coat and suit and dress industries, receive average hourly earnings of $1.56 and $1.14, respectively, and constitute 72 percent, an overwhelming majority, of the total employment in the women's apparel industry. The majority of garment workers are organized in the ILGWU, which has a membership of over 300,000. Examination of our prevailing union wage rates reveals that most wage scales are much higher than 65 cents, so that wage adjustments which may be necessitated by the proposed minimum are small. In New York City, where a majority of apparel workers are employed, the guaranteed minimum hourly rates in the dress industry range from 67 cents to $1.57, depending on craft. The cloak industry basic union rates range from 85 cents to $1.82 an hour, depending on craft. Since the majority of apparel workers earn above 65 cents an hour, it follows that compensatory wage increases necessitated by wage differentials will be relatively small. The payment of less than 65 cents an hour to garment workers today (considering the small number involved) perpetuates labor conditions which constitute an unfair method of competition.

THE ADOPTION OF A 65-CENT MINIMUM WAGE IN THE WOMEN'S APPAREL INDUSTRY NEED

NOT AFFECT PRICES OR QUALITY OF MERCHANDISE

Labor is but one item in the price of the finished product. In the women's apparel industry the percentage of wages to the total value of the product is comparatively small, varying from 14 percent in some branches to 20 percent in other branches. Improving equipment and plant efficiency can offset wage in

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