The Unemployment Boom-Four Articles:
FRANKE, A. H. RASKIN,SEYMOUR L. WOLFBEIN,THOMAS W. GAVETT, RICHARD C. WILCOCK AND WALTER H.
The Unemployment Boom—Four Articles After Steel's Debacle By A. H. Raskin If anyone doubted that historic changes in America's economic power relationships can be effected without violent...
...But usually this involves frustrating and expensive weeks of searching that end in a sad return home...
...When all these measures proved insufficient to persuade the parties to agree, the President called for a commitment to submit the issue to binding arbitration in the key case involving Pan American World Airways...
...A number of men have left the State to seek work elsewhere...
...Thomas W. Gavett is director of the Institute of Industrial Relations at West Virginia University...
...they are also basic to our international position...
...Up to a point, Federal assistance also proved helpful...
...By Richard C. Wilcock and Walter H. Franke Business recessions have been occurring with increased frequency in the United States during the last decade, and between these recessions the rate of unemployment has been reaching successively higher levels...
...Its prices went up more than three times as fast as the general price level from the end of World War II until 1958...
...But, by the same token and for the same reason, we must take steps to minimize automation's affects on workers and help them make the best possible adjustment to it...
...The Kennedy Administration believes four major steps should be taken to adjust to the impact of automation: 1. Establish an early warning system...
...They had been subjected to the most merciless tonguelashing Kennedy has yet administered to any Americans, plus a diversion of defense orders, a subpoena to appear at antitrust proceedings and a host of threats of punitive legislation...
...The overall balance would be kept by increases somewhat short of the productivity yardstick in industries with a chronic oversupply of labor or with wage rates far above those paid comparable workers in other fields...
...The industry went into the 1959 wage talks with strong bargaining advantages over the union...
...The real villain, again, seems to be the economic growth rate...
...The apathy the unionists had displayed toward any suggestion of a walkout evaporated...
...They dug in for a 116-day strike, the longest and costliest in steel history, and they would have renewed it after an 80-day Taft-Hartley injunction if Vice President Nixon and Secretary of Labor James P. Mitchell had not induced the companies to settle before the cooling-off period expired...
...How soon their situation will improve no one knows...
...the new Manpower Development and Training Act, which is now before Congress, will provide much more...
...Most of them have already accrued the burdens of an aborted education, an early marriage and a number of young children...
...This has raised the specter of the Marxism "mass reserve army of the unemployed...
...The chief long-term drawback in this formula is not that it denies fairness to either labor or management...
...This would require not only a sustained economic recovery but also continuous and imaginative refinement in the services of the public employment offices, programs for retraining and relocation, and administration of fair employment practice legislation...
...At the time I interviewed them, they had been given temporary jobs doing rugged outdoor work under the West Virginia Emergency Employment Program (EEP...
...But three essential questions still must be answered: Can economic expansion be sustained long enough for a 4 per cent level of unemployment to be achieved...
...Amid these pressures, Gross National Product, economic structure and industrial lag (for a moment at least) seemed beside the point...
...While I heard of no cases of malnutrition or any other serious physical degeneracy among children, 40 per cent of the men reported they had to reduce the money formerly spent on their children's education...
...the semi-skilled worker makes up about double his proportionate share...
...Most had little or no savings, and those who did have a few dollars shored up watched them drain away more quickly than they had thought possible...
...Should this recovery rate continue, unemployment would probably be reduced to 4 per cent early in 1963, even if new jobs were created no faster than in the 1958-59 recovery period...
...Steel's contention that the whole principle was "Socialistic...
...Our steel mills and other industrial facilities are growing obsolete at a time when our overseas competitors are investing twice as large a share of their Gross National Product (GNP) in new capital equipment as we do...
...Automation & Education By Seymour L. Wolf bein The United States today is witnessing a head-on collision between two vital trends...
...5· Workers in industries affected by large-scale technological change...
...Between the relatively prosperous years 1947-1959, for example, the layoff rate in manufacturing increased from 1.0 to 1.6 per 100 employes...
...The very young among the unemployed appear optimistic, although unsure after being brought to a complete halt so early in their working lives...
...What is perhaps more to the point is that the real interest of workers in collective bargaining these days—at least in industries affected by technological change, such as manufacturing, mining and transportation—is not in how much money goes into the package but in what it will buy in increased job security...
...When the Kennedy-Goldberg view was evoking dissent from the AFL-CIO and the National Association of Manufacturers, to say nothing of the big company spokesmen in steel, Block vigorously supported the doctrine that the Government should set forth the nation's needs as a guideline for industry and labor bargaining teams...
...What would be needed to push unemployment below 4 per cent...
...In the 1958-59 recovery, though, only about 66,000 new jobs resulted from each billion dollar increase in real GNP...
...The second factor is provision of facilities for the training and retraining of our unemployed workers, as well as employed workers who are already underemployed and threatened by the eventual obsolescence of their skills...
...But it must be remembered that training and retraining do not constitute a magic wand...
...The bullheadedness with which they embarked on this crusade proved almost as disastrous a miscalculation as their endeavor to raise prices this year...
...A few wanted to enter vocational retraining classes...
...President Eisenhower lost no opportunity to declare that the country would not stand still and see itself hurt by a fresh upsurge of wage-price inflation in steel...
...Of course, there are many reasons for the different kinds of long-term unemployment...
...The Unemployment Boom—Four Articles After Steel's Debacle By A. H. Raskin If anyone doubted that historic changes in America's economic power relationships can be effected without violent revolution, that doubt must have been dissipated by the speed with which President Kennedy routed the mastodons of the steel industry in a three-day period this month...
...In their place were men convinced that it had been a mistake ever to "coddle" the union...
...But if the recovery continues and follows the pattern of past experience, average hours of work will level off or decline slightly and unemployment will decrease...
...Overtime is high, with the factory worker today averaging about 2.6 hours a week...
...Responsibility" is a key word, for it is the necessary first step to action...
...The hard goods manufacturing sectors, particularly steel, autos and aircraft, have been hit hardest in this respect...
...2. Negroes...
...Automation is also raising the skill requirements of many jobs, making necessary more and more education and training...
...A. H. Raskin, veteran labor reporter, is now a member of the editorial board of the New York Times...
...But there will be very small growth in the central age groups...
...When the third and final round of increased labor costs under this contract came due last fall, the economy was beginning to show its first real signs of upturn after the slump that followed the crippling tie-up...
...If unemployment is largely structural, a good argument can be made for massive programs of public works, with the government directly creating jobs on a large scale...
...A fifth surrendered their automobiles and various household appliances...
...On the farm and in the factory, productivity is on the upturn, generating many employment opportunities but reducing the manpower needed in thousands of operations...
...They found themselves unable to provide money for materials the school did not furnish...
...Had any of the parties rejected arbitration at that juncture, it could have expected the same kind of public excoriation given the major steel producers...
...Almost one in four is out of a job today...
...But a strong case has also been made for the inevitability of structural unemployment as automation increases...
...Ninety per cent of the men cut back expenses for food and clothing...
...This is especially desirable because steel has been the pivotal industry in all the price-wage controversies since V-J Day...
...In the steel labor negotiations of 1959, this cozy relationship was shattered by the emergence of a "get tough" spirit on the management side...
...The President and his Secretary of Labor, Arthur J. Goldberg, who had been the steel union's general counsel through the 1959 siege, made it plain that they had no appetite for the hands-ofE role the Eisenhower Administration had manifested until the strike almost strangled the economy...
...As jobs become vacant, upgrading of the employed occurs and the resultant shifting opens up jobs for which the unemployed are qualified...
...If the problem is essentially one of the rate of economic growth, programs for public works and retraining would more appropriately supplement policies designed to stimulate expansion in the private economy...
...Whether their optimism is warranted remains doubtful...
...The President pronounced the pact non-inflationary, hailing it as "industrial statesmanship of the highest order...
...The abrupt collapse of the United States Steel Corporation and its allies in their effort to enforce a price increase of $6 a ton indicated with overwhelming force that the public interest can no longer be considered an amorphous abstraction, too unsubstantial to require primary attention by the massive power blocs of management or labor...
...When you get a little age on," as one of the men put it, "no one wants to hire you...
...A total of 1.6 million have been unemployed for four months or more...
...The latest returns—for March 1962— show that we have 66,316,000 persons employed, the highest March total in U.S...
...Almost 20 per cent of those who have been out of work for six months or more are under 25 years of age...
...Council Chairman Walter Heller recently testified before the Joint Economic Committee that "if the revival continues at the same pace," we could reach the "temporary target" of 4 per cent unemployment some time next year...
...Employers complain that it discourages the heavy investments necessary for plant modernization by giving the lion's share of the fruits to the workers, even though their work is made easier, rather than harder...
...It might be possible to sustain recovery long enough to reach a 4 per cent level but in view of recent experience the odds are against it...
...There are even some who think that in a few years 10 per cent may be the normal level of unemployment...
...Some of the men I talked with had not worked for as long as two years...
...For example, discrimination—both by age and by color—is an important consideration...
...This is primarily a matter of state and local initiative, which can be of great help in arranging the best possible match between the working force and the skills the country needs...
...Hard-core unemployment remains our most disturbing internal problem, as it has been since Kennedy took office 15 months ago...
...Under the Area Redevelopment Act of 1961, we have been able to provide some assistance...
...All told, what with Government assistance and scavengering around for odd jobs, most of the men managed to bring in 20-30 per cent of their normal earnings...
...Those who believe that we are creating a new "leisure class" of unemployed and underemployed generally assume three things: (1) Technological change, particularly automation, is now displacing workers faster than new jobs can be created...
...Yet developments in the missile field, steel and the airlines indicated that the concept of primacy for the national interest requires the peaceful resolution of labor-management disputes within the limits set by productivity...
...All of the evidence is not available, but what we have indicates that structural changes are not the primary cause of rising total and long-term unemployment...
...Displacement of workers from declining industries and occupations has been somewhat more rapid in recent years than in the first six years or so after World War II...
...For the time being there is nothing for them to do but continue to struggle while awaiting changes in an economy over which they have no control...
...Two factors are of the utmost importance here: The first is the acceptance of responsibility for the adjustment process by labor and management, especially through their contractual relationships—as, in fact, many already have...
...The U.S...
...But the management negotiators were not content to press for a contract that would have compelled the union to accept a nominal increase or none at all...
...This does not rule out more substantial adjustments where wages are substandard or where inequities interfere with the recruiting of qualified workers...
...The leading proponent of this view is the President's Council of Economic Advisers...
...Our rate of economic growth, already sluggish by the standards of Western Europe or the Iron Curtain countries, has been disappointingly slow in the first quarter of this year...
...The cornerstone of the Administration philosophy is that stable prices can best be maintained by keeping the package improvement in wages and fringe benefits in each year of a labor contract within the general confines of the 3 per cent annual increase in total industrial productivity...
...Many economists fear that the nation will be in the next recession long before unemployment comes close to what the Kennedy Administration has labeled the "interim goal" of 4 per cent...
...The union members themselves, hard hit by unemployment and short work-weeks in the 1958 recession, were in no mood to strike for more money...
...Thus, during the '50s there was a 40 per cent increase in the number of professional and technical jobs...
...Yet the faster pace of displacement does not seem to be the result of a more rapid rate of technological change and automation...
...Perhaps one of the most agonizing aspects of long-term unemployment occurs when it begins to affect one's children...
...The distribution of surplus foods, according to most of the men, was welcome, though it hardly constituted an adequate diet for an entire family...
...Part of the new Administration philosophy is that the country can no longer afford big strikes...
...Similarly, to argue that many people are unemployed because they are not qualified to fill vacant jobs is misleading...
...it has also revived the Keynesian notion that a private ownership economy can reach equilibrium at levels below full employment...
...As long as the tube held out, television was a way of dealing with the long, empty days...
...The interesting thing about the new lineup in steel is the key role taken by Inland Steel, whose chairman, Joseph L. Block, is an enthusiastic member of the President's Advisory Committee on LaborManagement Policy...
...The question now is whether the President can capitalize on the heightened prestige his victory has given him to forge a cooperative front of industry, labor and Government in a march toward the full production, full employment goals of the New Frontier...
...Examining the anatomy of unemployment and the people who make up the long-term jobless, six groups stand out very clearly: 1. Young people...
...The American labor force is still the most mobile of any industrialized nation...
...Unemployment is the big worry in most unionized industries, and the answers that come out of collective bargaining are far from sufficient to provide genuine reassurance...
...Before unemployment struck, the overwhelming majority of the men had worked at blue-collar jobs, earning on the average of $100 a week...
...Soon, the majority of the men were buying food and clothing on credit...
...Family income was further supplemented by odd jobs that the unemployed managed to pick up...
...one-third had been unemployed for a year or longer...
...In all previous postwar recoveries, expansion was much smaller in the second year than in the first...
...As debts mounted and credit stretched as thin as creditors would allow, the men borrowed from small loan companies and, where possible, relatives...
...Neither of these points is supported by Government data...
...Others, not so sure a growing class of hard-core unemployed is inevitable, argue that the basic problem is a lag in overall economic growth...
...Hours of work have moved past the 40-hour mark...
...The new steel agreement provides no direct pay increase...
...it is simply too mechanistic to be wholly satisfactory as a regulator of dynamic human relations...
...The older men, those over 55, are most anxious about the future...
...About 734,000 have been continuously out of a job for six months or more, slightly higher than February 1961, despite the decline in overall unemployment...
...They are up by 1.3 hours since February of last year...
...This failure of bargaining to erect basic props for the economy means that an essential part of the new Administration approach must be to develop a more assertive consensus on tax, budget, trade and legislative policies to pep up the growth rate and put the jobless back to work...
...These rather elementary facts—which economists seem to have to learn and relearn— struck me with special force during a recent study I made of how 200 men in a depressed area in northern West Virginia were withstanding the pressures of unemployment...
...Perhaps a similar maturity will now be reflected in the assault on our most challenging domestic problems...
...In the first year of each recovery, total unemployment declined between 3.3-3.7 per cent for every percentage increase in real GNP...
...Approximately 1.8 million jobs will be affected by automation and technological change in 1962 alone...
...Finally, if the rise in unemployment is due to heavy unemployment in depressed areas, the depressed area component should be a rising proportion of total unemployment...
...This hourglass picture of our labor force, showing a big bulge at the younger and older ends of the age scale and a very narrow waist in between, tells at least one big story: The U.S...
...Nationwide support of fair employment practices under Federal legislation also would improve the efficiency of the labor market...
...Taken together they represented a wide diversity of industries, although the greatest number—45 per cent—had worked at coal mining...
...This period will also see a solid 20 per cent increase in the number of older workers—men and women 45 years of age and over...
...The White House insists, with all the dutiful obeisance required by the shibboleths of "free collective bargaining," that it opposes any legal restriction on the right to strike and that it has no love for compulsory arbitration...
...But these are palliatives, not job-creating answers fundamental enough to lift the specter of idleness from the mill towns...
...But just as often, the child—embarrassed by the shabbiness of what little clothing he did have, and ashamed at not being able to pay his own way—dropped out of school or suddenly became chronically absent...
...6. Workers in distressed areas...
...4. Unskilled and semi-skilled workers...
...Full implementation of the Area Redevelopment Act of 1961 and the Manpower Development and Training Act now before Congress, as well as expansion of private efforts of employers and unions to facilitate the labor market adjustment of displaced workers, can speed up the movement of workers between jobs —if the recovery is sustained...
...4. Take all possible action to ease the impact of automation...
...Both total and long-term unemployment declined as output and jobs expanded...
...Long-term unemployment was slower to react, but when measured over a two-year period during each recovery, the percentage decline for every percentage increase in GNP was about the same—between 6.6-7.0...
...So was his vice president for industrial relations, John A. Stephens...
...If the alternative is a Federal deficit of $2-3 billion or a shortfall of several times that much in the GNP, the nation can better afford the red ink in the budget than it can the frustration of its jobless and the waste of its productive resources...
...Although recovery from the most recent recession began in the first quarter of 1961, unemployment hovered close to 7 per cent of the labor force through most of last year...
...Richard C. Wilcock and Walter H. Franke are on the faculty of the University of Illinois' Institute of Labor and Industrial Relations...
...This suggests that as the economy becomes more productive somewhat larger dollar increases in output are required to produce a given volume of new jobs...
...Nor do we yet have to institute drastically shorter hours of work or demand that the Government "make work" with a massive public works program and maintain millions of workers indefinitely on unemployment insurance and relief...
...Instead, they unfurled an eight-point program for abolishing wasteful local work practices...
...The most important factor in controlling unemployment is the ability of the economy to continue to expand at its recent rate...
...it now accounts for only 5 per cent of all employment in the country...
...From now on every adjustment in prices or wages in the basic industries will be subject to public scrutiny—and to public veto if the President becomes sufficiently incensed to mobilize the coercive forces of Government and of popular opinion, as he did against the captains of steel...
...Schools must know of new automation devices so they can adjust their curricula accordingly and offer better career guidance to our youth...
...If our analysis is correct, why has the unemployment rate not fallen more rapidly in the current recovery period...
...Some families forfeited insurance policies which they had paid for years...
...For this reason, the Administration has asked Congress for stand-by Executive power to trigger up to $2 billion in public works projects and to reduce income taxes if unemployment should rise in three out of four, or four out of six, consecutive months for a total gain of more than one percentage point...
...Perhaps we can best determine which theory is correct by seeing how consistently and how successfully economic expansion has generated new jobs in postwar recovery periods...
...They make up 10 per cent of all workers, but 20 per cent of the unemployed and 25 per cent of the very long-term unemployed...
...Training is one of the most promising areas of action...
...To qualify for the jobs, they first had to exhaust their eligibility for Federal unemployment compensation...
...The Administration's basic philosophy in this field is as follows: Automation and technological change are necessary...
...And this time it was Bethlehem, not United States Steel, which set the pattern—as it had in 1949 when it led the way in signing an employerfinanced pension and welfare contract with the union, despite U.S...
...The result was the signing, three months before the old agreement ran out, of the most moderate cost package in recent years...
...Speedier reduction in the unemployment rate during recoveries is also possible...
...must find employment opportunities for a labor force increase 50 per cent larger than during the previous decade...
...Thus these men were not typical of the unemployed around the nation...
...Many fell behind in their rent, low as it was...
...During the year of recovery which followed the recessions of 1948-49, 1953-54 and 1957-58, increases in the Gross National Product (GNP) were quite rapid and of about the same magnitude in each case...
...And the reverberations will continue to be with us for at least the remainder of the 1960s...
...Unemployment is especially heavy among teenagers...
...The experience with the initial programs under the Area Redevelopment Act has been heartening...
...Hopefully, there will be sufficient economic growth, training and retraining to keep them employed...
...Price stability and wage increases geared to rising productivity create a climate for expanding the domestic economy and improving our position in international trade, but affirmative actions on a sustained basis are necessary to achieve either goal...
...This calls for a revision of labor's doctrinaire objections to tax spurs for capital investment and industry's worship of a balanced budget regardless of national needs...
...Unemployment can be reduced if the decisions of consumers, producers and Government policymakers encourage capital expansion and a sustained rate of economic growth...
...The correction of these downpulls on our economic well-being requires the generation of high levels of market demand and a sharp acceleration in expenditures for plant modernization...
...State public assistance, on the other hand, was available to only 5 per cent, for under West Virginia law a person is not eligible for relief payments as long as there is a single able-bodied worker in his family...
...Accelerated worker displacement, higher layoff rates and depressed area unemployment can all be largely attributed to inadequate demand...
...Thus, the picture is one of rising job totals, high working hours and high earnings—side by side with a large number of people who have not been able to take advantage of the upturn in employment opportunities...
...The additions to total employment, however, have been primarily in increased hours for the employed rather than in reductions in unemployment...
...To assess the dimensions of the power shift that has taken place and the extent to which it can be translated into a force for cooperation, rather than conflict, it is worthwhile to appraise the developments that led up to the steel debacle...
...This is not only West Virginia's largest industry but one that has undergone immense technological change and reduction in personnel...
...The President put his full support behind the panel's proposals for a merger of the two unions, but no settlement followed...
...Benjamin F. Fairless, who had preached the doctrine of friendly union relations as a key to greater efficiency, was out of any position of authority in United States Steel...
...2. Get that information to where it counts...
...Seymour L. Wolfbein is the Deputy Assistant Secretary of Labor...
...Despite all this, confusion and doubt, rather than desperation, seem to be the pervading feeling...
...In these regions, employment opportunities have been low for many years, due to structural changes in our economy...
...Is Growth the Answer...
...At the beginning, the major source of income for the West Virginians came from unemployment compensation, which usually lasted four to six months...
...More converts to this view will be sought at the upcoming White House National Economic Conference...
...One appliance, though, stayed—the television set...
...Finally, it is our judgment that unemployment could be pushed below 4 per cent...
...All the 10cents an hour of new money will go into longer vacations to spread the work, earlier retirement and more substantial pension benefits, liberalized supplemental unemployment insurance payments and other financial aids against wage loss in periods of joblessness...
...They are only one part of a total program which, accompanied by expanding economic growth, can give us the maximum benefits from automation with the minimum impact to the people involved...
...Without swift progress in both directions, the risk is great that we will move back into recession by the end of the year—after the shortest and weakest recovery in our postwar experience...
...Together, both groups account for two out of every five of our hard-core jobless...
...2) The new jobs demand qualifications of education and technical training not possessed by more than a handful of the long-term unemployed...
...Since employment has always increased most rapidly in periods when productivity was rising, it is reasonable to expect both productivity and employment to increase if economic growth can be accelerated...
...An additional 40 per cent increase in the '60s is likely...
...In fact, average productivity in the economy has accelerated little, if at all, in the past few years...
...Almost as many reduced the amount of money they used to spend on recreation and entertainment, which was not very high to begin with...
...Employment services, labor unions, and industrial, business and commerce leaders, also need information on technological changes before they occur...
...The recoveries of 1954-55 and 1958-59, in fact, were about finished after four or five quarters...
...The Administration began pushing for just such a realignment of economic power along pro-public lines when it made its original hold-the-line plea to the steel companies and the United Steelworkers of America last September ("The Wage-Price Spiral," NL, October 16, 1961), but no one in the White House dreamed that so profound a shift could be effected in so short a period...
...True, the giants quickly fell in line, but two of the smaller companies held out—Inland and Kaiser, accounting for less than 7 per cent of national steel capacity—causing the industry front to crumble...
...they are basic to our aspirations for our own domestic economic growth...
...It was against this backdrop of sweetness and light that United States Steel announced its price increase three days after the last big company had signed on the union's bargain-basement terms...
...The second trend is the great and accelerating increases in automation and technological change...
...We now have made enough case studies of automation's impact to be able to minimize its effects appreciably...
...In fact, it has already upended our job picture...
...34 of the men I talked with claimed to have fallen into debt for this reason alone...
...Secretary Goldberg persuaded the flight engineers to end their strike last year on the basis of appointment of a special Presidential commission to recommend terms for settlement of the jurisdictional fight at the heart of all the long series of airline labor discord...
...The companies reacted coldly to the President's attempt at "psychological price control," but they did hold the line and the Administration demonstrated that it could apply the same energy to putting the brakes on the union that it had applied to the industry...
...When this goal is in sight, it will be time to re-examine the Full Employment Act of 1946 and to consider the feasibility of guaranteeing—through a combination of retraining, relocation and unemployment insurance—that no ablebodied worker ever suffer the ignominy of going on relief...
...The best possible intelligence must be secured on new automative innovations which will affect our employment situation...
...they have to be accelerated...
...The unskilled laborer makes up triple his proportionate share of the very long-term unemployed...
...This view was perhaps most comprehensively illustrated in the row involving the air lines and the two unions representing pilots and flight engineers over the manning of cockpits in jet planes...
...Strike date after strike date was set on the major airlines, and Goldberg just as regularly averted a showdown through the appointment of new fact-finders or special mediators...
...About one-tenth of them, however, found themselves with less than 10 per cent of their former income...
...Occasionally, the school, a church or a charitable agency would step in and supply the money necessary to keep the child in school...
...Seventy-two bruising hours later, the chastened heads of Big Steel backed down...
...But they faced the principal problem of the unemployed everywhere: how to keep going after a jolting reduction in income...
...There will be a 46 per cent increase in the number of new young workers during the current decade, which means an addition of 26 million entering the labor market...
...The current effort to expand the counseling, placement, and informational activities of the public employment service can—if widely accepted by employers and workers—accelerate the movement of workers into different occupations, industries and areas...
...Some of the men, particularly the coal miners, retain The Dream: Their old jobs will once again be made available and all will be normal...
...Shortly after I finished my study, the men were taken off EEP and given work under the Aid to Dependent Children of the Unemployed Program, where they earn about $100 a month...
...Similarly, statistics are not human beings, nor do they even do a good job of describing them...
...Unions complain that it fails to provide adequate latitude for altering the shares of income received by workers and stockholders—that it merely freezes their existing cuts of the economic pie...
...Thus, the fairly consistent affects that economic expansion has had on total unemployment, long-term unemployment, and the total expansion of jobs seem to support the theory that the basic cause of successively higher levels of unemployment in recent prosperity periods has been inadequate economic growth...
...This makes it difficult for them to obtain a job in the face of record levels of employment — employment which, under the impact of automation and technological change, calls for increased skills...
...Although precise measures of worker displacement are not available, there is some evidence of a rising trend...
...The Human Factor By Thomas W Gavett Unemployment, alter all, is only a word...
...If average hours of work increase substantially above the present level, or if new entrants to the labor force are more numerous than anticipated, attainment of the 4 per cent goal would require a longer period of sustained expansion...
...In fact, this process began last December...
...They began to feel the impotence and confusion of long-term unemployment...
...Can the process of reducing unemployment be accelerated...
...When out-of-state jobs are found, the expense of continuing to maintain a family (sometimes with as many as 12 dependents) back in West Virginia, or, alternatively, moving them to the new job, proves overwhelming...
...others had been unemployed only a relatively short time...
...At 4.4 million, it is significantly below the 5.7 million of last February, yet still well above the figures we were able to set a few years ago...
...Some of the intractably unemployed are now being moved into a position where they can learn a new skill and can be placed in jobs under the new technology...
...The majority, however, had not worked during 10 full months of 1960 and the entire first half of 1961...
...Once out of a job, they are finding it increasingly difficult to find employment, as many of their skills obsolesce under the impact of automation and technological change...
...Which of these controversial views is accepted has an important bearing on public policy...
...In addition, there should be a decline in worker mobility out of such areas...
...A total of 4.4 million workers are still jobless, and one-third of these have been without work for 15 weeks or more...
...men determined to re-establish management's right to manage by abolishing all union-enforced curbs on productivity...
...The biggest contributors to joblessness among these youths, of course, are the school dropouts—boys and girls who do not have a high school diploma...
...in fact, the number of workers 3545 years old will actually decrease...
...In particular, long-term joblessness remains too high...
...Previous experience suggests that long-term unemployment will then approximate the level it reached when total unemployment was last at 4 per cent...
...This requires forward-looking planning by labor and management...
...But unemployment for March remains at an unsatisfactorily high level...
...The Manpower bill's effectiveness would be increased if Congress restored the provision for financial assistance to workers who relocate...
...The program was so extreme in its impact on all existing work rules, the union rank and file promptly interpreted it as a move to win back for the employers the absolute control of the mills that they had enjoyed before the New Deal and the organization of the mass industries...
...Throughout 1961, real GNP increased at the rate of 2.4 per cent per quarter...
...we have already completed the fourth consecutive year in which the unemployment rate among teenage boys has been at least 12 per cent...
...If the present recovery levels off by the middle of 1962, unemployment may not even fall to the 5 per cent level before going up again...
...This is the agency through which Secretary Goldberg has been trying to win broader acceptance of the Administration's thesis that it has a responsibility to assert and define the national interest in collective bargaining...
...Its wages also raced far ahead of those of other industrial workers, and the steel union blandly disavowed any interest in the price increases that automatically followed each boost in labor costs...
...The rate of worker displacement would be offset by new jobs, they believe, if capital investment and innovation in the economy were kept at easily attainable levels through appropriate fiscal and monetary policies...
...Despite some gloomy predictions, we do not yet have to accept a definition of "full employment" that permits unemployment of 5-6 per cent or more during periods of prosperity...
...To put the problem another way, if unemployment is mainly structural, expansionary policies would result in higher prices rather than more jobs because the unemployed would not have the qualifications that employers would need...
...The strong backing that responsible leaders of management and unions have been giving to the President's program of more flexible tariffs to expand trade with the European Common Market is a heartening sign that historic attitudes on both sides can be modified by an awareness of changing world needs...
...3. Stimulate and promote practices which will help workers adjust to inevitable changes in their jobs...
...is the only nation in the world which actually has more workers in the white-collar occupations and service-producing industries than in all the blue-collar jobs in the goods-producing industries put together...
...Its proponents argue that rapid technological change accelerates worker displacement and leaves the unemployed unqualified for the new jobs being created...
...Actually, the number of new jobs created during the first three quarters compares favorably with the number created during comparable periods in earlier recoveries...
...The men already in their sixties hope for no more than to be able to hang on until relief comes in the form of Social Security payments...
...3) Many unemployed, trapped in depressed areas, would not be materially aided by general economic expansion...
...Weekly and hourly earnings of factory workers are both at all time highs...
...3. Older workers...
...This was supplemented, in 20 per cent of the cases, when one of the family who formerly had not worked took on a job...
...The first trend is an unprecedented growth in the American labor force...
...The impact of the joining of these two important trends, a process that is continuing, can be clearly seen as the returns come in on the employment, and unemployment standings each month...
...When medical bills hit, they hit hard...
...Men and women over 45 also contribute a disproportionately large share to the long-term jobless...
...Kennedy asked the steelmakers not to raise prices when they raised wages, and he assured them that their forbearance would create a powerful obligation on the union to confine itself to wage demands consistent with price stability and productivity in its bargaining this year...
...In the first two periods, the net employment increases—adjusted for changes in the size of the armed forces and in average hours of work—also were very similar: Approximately 80,000 new full-time equivalent jobs were created by each billion dollar increase in real GNP...
...Fully 50 per cent of the trainees enrolled so far had been unemployed for half a year or more...
...If, on the other hand, most unemployment has resulted from a lag in economic growth, expansionary policies could reduce unemployment below 5 per cent without creating a serious inflationary situation...
...The seriousness of this is underscored by the fact that 7.5 of the 26 million new young workers scheduled to enter the labor market this decade will be dropouts...
...history...
...But the number of unskilled jobs keeps going down...
...The peace terms represented a total defeat for the industry on the pivotal issue of work rules, and most observers considered the economic concessions the companies gave greater than those the union would have settled for without a strike...
...But there is one overriding common denominator tying these various groups together: a lack of skill...
...Equally significant, United States Steel had discovered that its precept was no longer law in the industry...
...Hopefully, refinement of the analysis of economic indicators will in time permit faster action...
...Since February 1961 (the turning point of the current business cycle), employment has gone up by 1.6 million...
...But should the economy continue to expand beyond mid-1962, much as it did in the early 1950s, unemployment could reach the 4 per cent level before the end of 1963...
Vol. 45 • April 1962 • No. 9
