[United States Department of Labor Fifty-Second Annual Report, Fiscal Year 1964]
[From the U.S. Government Publishing Office, www.gpo.gov]
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Fifty-second Annual Report
UNITED STATES
DEPARTMENT OF LABOR
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Fiscal Year 1964
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Fifty ^second
Annual Report
UNITED STATES
DEPARTMENT OF LABOR
W. Willard Wirtz, Secretary
For sale by the Superintendent of Documents, U.S. Government Printing Office Washington, D.C. 20402 Price 65 cents (Paper Cover)
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UNITED STATES DEPARTMENT OF LABOR
Secretary of Labor.............................................. W. Willard Wirtz
Executive Assistant to the Secretary....................... N. Thompson Powers 1
Special Assistant to the Secretary for Economic Affairs.... Stanley Ruttenberg
Special Assistant to the Secretary for Legislative Affairs. Samuel V. Merrick
Special Assistant to the Secretary......................... Arthur A. Chapin 1 2
Special Consultant to the Secretary on Youth Employment..... India Edwards 3
Director, Office of Information, Publications, and Reports..John W. Leslie
Under Secretary ................................................John F. Henning
Deputy Under Secretary...................................... Millard Cass
Special Assistant to the Under Secretary....................Jack Howard
Assistant to the Under Secretary............................ Robert K. Salyers
Manpower Administrator........................................John C. Donovan 4
Executive Officer........................................... Samuel Ganz
Deputy Administrator for Planning, Research, and Evaluation
and Director, Office of Manpower, Automation, and Training . Seymour L. Wolfbein Deputy Administrator for Operations and Administrator,
Bureau of Employment Security............................. Robert C. Goodwin
Administrator, Bureau of Apprenticeship and Training........ Edw. E. Goshen
Assistant Secretary for Labor-Management Relations..............James J. Reynolds
Deputy Assistant Secretary.................................. Nelson M. Bortz
Administrator, Labor-Management Services Administration.... James J. Reynolds 5 * Director, Office of Labor-Management and Welfare-Pension
Reports................................................... Frank M. Kleiler s
Director, Office of Veterans’ Reemployment Rights........... Hugh W. Bradley7
Director, Office of Federal Employee-Management Relations.... Louis S. Wallerstein, Acting
Administrator, Wage and Hour and Public Contracts Divisions.. Clarence T. Lundquist Assistant Secretary for International Affairs................... George L-P Weaver
Deputy Assistant Secretary and Administrator, Bureau of International Labor Affairs................................ Harry Weiss
Esther Peterson Morris Weisz
Mary Dublin Keyserling 8 Arthur W. Motley William McCauley Theodore M. Schwartz Daniel Patrick Moynihan Philip Arnow Ewan Clague Charles Donahue Kenneth C. Robertson 9 Leo R. Werts V. S. Hudson
Edward J. McVeigh Margaret F. Brickett
Assistant Secretary for Labor Standards..........................
Deputy Assistant Secretary...................................
Director, Women’s Bureau.....................................
Director, Bureau of Labor Standards..........................
Director, Bureau of Employees’ Compensation .................
Chairman, Employees’ Compensation Appeals Board..............
Assistant Secretary for Policy Planning and Research.............
Deputy Assistant Secretary...................................
Commissioner of Labor Statistics.............................
Solicitor........................................................
Deputy Solicitor.............................................
Administrative Assistant Secretary...............................
Deputy Administrative Assistant Secretary....................
Assistant Administrative Assistant Secretary.................
Librarian..................................................
1 Appointed Apr. 6, 1964.
2 Appointed July 3,1963.
8 Appointed Mar. 24,1964.
« Appointed to this position Apr. 6,1964, from position of Special Assistant to the Secretary.
8 The Labor-Management Services Administration was established Aug. 21,1963, and James J. Reynolds was designated Administrator in addition to his responsibilities as Assistant Secretary for Labor-Management Relations. ,,, , , . , .,
« The Office of Labor-Management and Welfare-Pension Reports was established as a component of the Labor-Management Services Administration Aug. 21,1963, and Frank M. Kleiler, formerly Director of the Office of Welfare and Pension Reports, was designated Director.
i The Bureau of Veterans’ Reemployment Rights was redesignated Office of Veterans’ Reemployment Rights and transferred to the Labor-Management Services Administration Mar. 13, 1964.
8 Appointed Apr. 13, 1964.
• Appointed Oct. 13, 1963.
UNITED STATES DEPARTMENT OF LABOR ANNUAL REPORT, 1964
CONTENTS
Page
Report of the Secretary of Labor............................. 3
APPENDICES
Reports of the Office of the Secretary
Administrative Assistant Secretary.......................... 11
Director of Information, Publications, and Reports...... 19
Solicitor of Labor...................................... 21
Bureau Reports
Manpower Administration...................................... 33
Bureau of Apprenticeship and Training............... 39
Bureau of Employment Security....................... 45
Office of Manpower, Automation, and Training........ 83
Labor-Management Services Administration................ 95
Bureau of Employees’ Compensation........................ Ill
Employees’ Compensation Appeals Board................... 123
Bureau of International Labor Affairs.................... 127
Bureau of Labor Standards................................ 135
Bureau of Labor Statistics............................... 151
Wage and Hour and Public Contracts Divisions........... 171
Women’s Bureau........................................... 217
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REPORT OF THE SECRETARY OF LABOR
REPORT OF THE SECRETARY OF LABOR
Nineteen hundred and sixty-four was a year of decisive events in American social progress. Momentous statutory commitments were made to provide every citizen with economic opportunity and full citizenship.
When President Lyndon B. Johnson declared an “unconditional war against poverty,” he was expressing the national will to solve the paradox of substantial poverty in the midst of unprecedented abundance. The longest peacetime expansion in our economic history continued through the year, resulting in record numbers of employed, record high wages and profits, and record production. Yet one-fifth of all Americans—35 million men, women, and children in 9 million families—lived on family incomes of under $3,000 per year.
This economic fact was the context for the increasing demand that prejudice no longer be allowed to hinder any individual’s opportunity for education and employment—an opportunity already clouded by poor schooling and exclusion from many kinds of rewarding work.
Increasing national wealth made the time auspicious for programs to accelerate the rate of decline in the number of poor families. The vast potential of automation, coupled with a rapid increase in population, made it mandatory to move against prejudice before it permanently canceled millions of futures.
These considerations resulted in the passage of the Civil Rights Act and the Economic Opportunity Act by the 88th Congress, at the recommendation of the President. The Department of Labor, in its 52d year of service, was assigned important responsibilities in the national effort to achieve a more equal and open society.
The Department came to these responsibilities with a maturing experience in manpower development. Since 1962, when the administration of the newly enacted Manpower Development and Training Act was placed in the Labor Department, the public program to fit and refit human skills has been accelerating. In fiscal 1964, the number of these programs approved totaled 2,700 for 145,000 individuals—double the amount of the previous year. It brought to 4,301 the number of projects approved for 218,101 men and women.
As the manpower program expanded, it became evident that it was bringing immediate opportunity to those best equipped to seize it—those advantaged by education or previous work experience. The statutory requirement that funds for youth training be limited to 5 percent of all allowances paid under MDTA had the effect of withholding training from those most in need, the rapidly increasing ranks of the young unemployed.
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Of the first 100,000 men and women trained under MDTA, 17 percent were teenagers—yet they comprised 24 percent of the unemployed. A full 72 percent of the first 100,000 were between the ages of 20 and 44. Well over half of all of the trainees had completed high school, an educational distinction enjoyed by only one-third of the Nation’s unemployed.
In December of 1963, the Congress responded to a recommendation to broaden the scope of the MDTA to permit it to reach these young, under-educated unemployed. The 5 percent limitation on funds for youth training was lifted to 25 percent. Basic literacy training was authorized, making it possible for the first time to educate a man or woman in order to equip him for training. Training can now be conducted in private as well as public facilities.
Within days of the enactment of these amendments, the President’s Task Force on Manpower Conservation added more convincing evidence on the need for an effective manpower policy. The Task Force, composed of the Secretaries of Defense, Labor, and Health, Education, and Welfare and the Director of the Selective Service System, had been established by President Kennedy in September 1963, to recommend a program for the rehabilitation of young men rejected for military service. The Task Force found that one out of every two selective service registrants called for preinduction examination had been found unqualified. The average age of those called for examination was 22-23. It was further found that if all of the Nation’s young men turning 18 were examined, one-third would fail—about half for medical and half for mental reasons.
Following the recommendations of the Task Force that rejectees be offered needed health, education, training, and other rehabilitation programs on a voluntary basis, the public employment service instituted the Selective Service Rehabilitant Program in cooperation with other interested agencies. For the first time, our manpower program included some provision for those young men not fit for peacetime military service (and by implication unfit for an economy that demands educational achievement), but who had previously been rejected and returned to their homes without any attempt to correct their deficiencies.
Experimental and demonstration programs conducted under MDTA had probed into the conditions of poor urban life and isolated rural existence, seeking answers to the difficult question of whether training is an appropriate answer to the employment dilemma of those without education. The institutional programs of MDTA were dealing with those who had some success in life, either in school or in work. The experimental programs were dealing with the defeated. By definition, the 20 special youth projects approved in fiscal 1964 involving some 10,000 boys and girls had as their clients young men and women between the ages of 16 and 21 who were out of school and unemployed, who lived in seriously impoverished circumstances, and who could not be expected to benefit from regular occupational training.
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Additional valuable experience was gained during the summer of 1964 through Project Cause. Looking forward to the time when new avenues would be provided for disadvantaged youth to escape from illiteracy and poverty, Project Cause was a campaign to recruit and train 1,750 counselor aides and youth advisers to stall Youth Opportunity Centers serving needy young persons. Nearly 22,000 applicants filed for the program. Those chosen entered a 10-week program conducted at 27 universities in various regions of the country. For 50 hours a week, they received intensive instruction in the special techniques of dealing with disadvantaged youth. More than 1,000 of these graduates are now at work in State employment service agencies, preparing for their key roles in the war against poverty.
The Department of Labor, then, had already assembled an impressive experience in dealing with disadvantaged unemployed when the Economic Opportunity Act added new responsibilities.
Youth unemployment, especially among the school dropouts, presents our society with one of its gravest problems. In the entire decade of the 1950’s, the number of 18- and 19-year-olds in the labor force increased by 300,000. During 1965 alone, their numbers will rise by 600,000 to 4 million.
Many thousands of these new workers have already been assigned by the circumstances of their birth to the human scrap heap of wasted Americans that promises to grow larger with the population—unless they receive help. An important part of that help will be provided by the programs authorized by the Economic Opportunity Act. The largest of these in terms of numbers is the Neighborhood Youth Corps, administered by the Department of Labor. The NYC is designed to enroll 200,000 youths of 16 to 21, both boys and girls, in work-training programs each year. Those young people having difficulty staying in school for financial reasons will be provided with part-time work; others who have dropped out will be enabled to return; and still others will receive the training necessary to start them on an employment career.
Planning for the establishment of the Neighborhood Youth Corps occupied a special task force for many months during 1964, so that at its formal announcement several major programs were ready for almost immediate approval.
During this entire period, the research projects under MDTA began to mature. The Office of Manpower, Automation, and Training developed 40 new projects during fiscal 1964. For the first time, the Nation had in prospect an accurate analysis of many of the important factors of economic life—manpower supply and demand, occupations that will expand and those that will diminish, the impact of technological change upon various industries, the geographical movement of industry, the motivation behind successful training and behind the failure to take advantage of training.
On-the-job training programs also showed a marked increase over 1963- A total of 1,130 new apprenticeship and 992 industrial training
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programs were developed and installed by the Bureau of Apprenticeship and Training during 1964. Training was provided for between 225,000 and 250,000 apprentices. OJT programs under MDTA were approved for 10,200 workers.
An additional element in the emergence of an effective manpower program came with the opening during 1964 of Apprenticeship Information Centers in Baltimore, Boston, Chicago, Cincinnati, Cleveland, Detroit, and Newark. At these centers young men are receiving guidance and counseling in apprenticeship programs and referrals are being made to existing programs.
Progress was made in filling one of the largest gaps in our manpower knowledge—that of existing job vacancies in specific areas by specific occupations. Pilot programs in Chicago and Buffalo proved the feasibility of conducting job vacancy surveys. Toward the end of 1964, 20 such surveys were started as a joint effort of the Bureau of Labor Statistics and the Bureau of Employment Security.
In the same vein, Project LINCS was inaugurated. In this experiment, automatic data processing and telecommunications are used to speed labor supply and demand data between 17 stations in the Western States.
The intensive progress made in manpower development highlighted a period of increased activity for the Department as a whole. For the Women’s Bureau, 1964 will remain memorable as the year of the passage of the long-awaited Equal Pay Act, which became effective on June 11, 1964. By that month, 32 Governors’ Commissions on the Status of Women had been established, and also in that month a conference of the Governors’ commissions was held in Washington, for which the Women s Bureau did the staff work.
During the year, the Department prepared for the expiration of Public Law 78 on December 31, 1964. On that date, the 14-year-old program under which Mexican nationals were imported to work our farms came to an end. As the year ended, the Department mounted vigorous recruiting campaigns to obtain domestic workers to take these jobs. The stakes here are high: tens of thousands of jobs for otherwise unemployed men and women, the efficient operation of a great many business enterprises, and the winning of a fight for human decency.
The Office of the Solicitor of Labor also recorded a noteworthy event in 1964 when the fringe benefits amendments to the Davis-Bacon Act were passed—the first substantive change in that law since its original passage in 1935. The Office drafted the regulations that eventually established the Wage Appeals Board, which has the responsibility of reviewing all important cases under the Davis-Bacon Act and its related statutes. During the year, the number of court cases instituted under the Fair Labor Standards Act and the Walsh-Healey Act reached an alltime high of 1,608, of which 49 were criminal prosecutions. These resulted in 1,507 favorable civil dispositions and 41 criminal convictions.
The Bureau of Labor Standards intensified its safety programs, con
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ducting 429 training sessions for 17,000 union members and 43 for about 4,000 Federal employees, in the face of a mounting accident total. In 1964, a total of 227,152 work injuries was reported to the Bureau of Employees’ Compensation. While Federal civilian employment was unchanged, all segments of private employment had increases in injuries, averaging nearly 7 percent.
The Bureau staffed the Ninth Biennial President’s Conference on Occupational Safety during the year. Over 3,000 delegates from all segments of American life met to discuss the means by which occupational deaths and injuries might be prevented. Each year, 2 million men and women lose their lives and 14,000 persons are injured in occupational accidents.
The Wage and Hour and Public Contracts Divisions of the Department completed a record number of 56,000 investigations. Almost $23 million in back wages was recovered for 189,000 employees. On September 3, 1963, the minimum wage increased from $1.15 to $1.25 in accordance with the provisions of the 1961 amendments to the Fair Labor Standards Act. About 2.6 million of the 24 million workers covered by the act received a direct pay increase as a result. The Equal Pay Act brought new duties for the Divisions, charged with the enforcement of its provisions that prohibit wage discrimination on the basis of sex.
With the publication of the January 1964 Consumer Price Index, the Bureau of Labor Statistics completed its 5-year revision of the index. Experimental surveys were started to improve the concepts of “unemployment” and ‘‘labor force” as a further implementation of the recommendations made in 1962 by the President’s Committee to Appraise Employment and Unemployment Statistics. Two of the important studies released by BLS during the year analyzed the relationship between private pension plans and labor mobility and described the technological trends in 36 major American industries.
It has become increasingly evident that more detailed information about the labor force, trends in employment, the nature of unemployment, and the character of occupational shifting is needed. A manpower program designed to provide opportunity for every person, to staff the modern economy with skills at the time and place they are needed, to maintain training facilities as needed crossovers to new and better jobs will extend only as far as our knowledge permits. The expansion in operating programs must be accompanied by an expansion in our knowledge of the labor force and its future.
The events of 1964 demonstrated once again that the labor factor is a crucial one in United States foreign relations. In a wide range of developing countries, the political leadership has emerged from the labor movement. Often, the labor movement in a nation is the only representative of popular opinion—and the only institution capable of exerting a lasting influence on that opinion. Our nation continues to have a paramount interest in assisting foreign labor movements to achieve democratic and free processes. A new Office of Program Development and Coordi
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nation was formed in 1964 within the Bureau of International Labor Affairs to assist less developed countries in the formation of labor and manpower institutions. During the year, the Bureau helped to arrange programs for 680 foreign visitors, including 508 trade unionists.
This brief survey of highlights of the Department’s activity during 1964 indicates the kind of progressive change that is taking place, both in our society and in those institutions devoted to improving it. That change is for the better. Never before has the Department been so well equipped to undertake that central of all tasks, providing for the future generations a guarantee of absolute employment opportunity. While much of the Department’s work is technical in nature, while many of the programs may deal in abstract concepts and impersonal data, the welfare of the individual American working man and woman remains the subject and the object of our efforts.
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OFFICE OF THE SECRETARY
OFFICE OF THE ADMINISTRATIVE ASSISTANT SECRETARY
The Administrative Assistant Secretary is the principal administrative official of the Department. He is responsible for the budgetary and financial management, personnel management, administrative management, program analysis and evaluation, and organization of the Department, for the provision of administrative services, and administration of the Department of Labor Library. He is assisted by a Deputy Administrative Assistant Secretary who serves as the Department’s comptroller, and by an Assistant Administrative Assistant Secretary who also serves as Director of Personnel.
All major relationships outside the Department on administrative and management matters are developed and maintained by the Administrative Assistant Secretary. He also coordinates contacts with the Bureau of the Budget and the Congress, except for those involving substantive legislation.
BUDGET AND FINANCIAL MANAGEMENT
Appropriations and other authorizations for the Department of Labor for fiscal year 1964 totaled $871 million and provided for almost 9,000 positions. Of this amount, $207 million was for salaries and expenses, $225 million for unemployment compensation for Federal employees and ex-servicemen and injured Federal employees’ compensation claims and expenses, and $439 million from trust fund authorizations (including $425 million for grants to States for administrative costs of the employment compensation programs).
Included in these figures are suppiementals for the unemployment compensation fund for Federal employees and ex-servicemen, $42 million; the employees’ compensation and claims fund, $5 million; manpower development and training activities, $20 million; Mexican farm labor program’s compliance activities, $430,000; and reimbursement from Mexican farm labor supply fund (salaries and expenses), $165,000. (See table 1.)
ORGANIZATION AND MANAGEMENT
The Department developed and began the installation of a program budget management system which will provide on a departmentwide basis an integrated system of planning, programing, budgeting, accounting, reporting, and review and analysis. This system will make it possible to
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improve management control by forecasting workloads and resource requirements against which progress will be measured. The system seeks to provide a manageable method of dealing with the entire program of the Department, or of one of its major components, in terms of judgments as to work to be done, accomplishments to be sought, costs of program support, and the balance and interrelationships of program elements.
A forms and reports management program was initiated which provides for: (a) Minimum program standards and criteria for all internal forms and reports created by bureaus and offices, and (b) policies and procedures to govern the establishment of forms and reports required by the Department from the public, industry, and outside agencies.
The Department eliminated 29 repetitive reports and simplified 79 reports in response to the President’s directive calling on all agencies to review all external reporting requirements. This reduction of the paperwork burden on the public by the Department resulted in the discontinuance of 682,816 annual reports and the simplification of an additional 68,990 equivalent annual responses.
A management survey was conducted of the accounting, payroll, and voucher audit operations which are centralized in the Office of the Administrative Assistant Secretary. Procedures, controls, and utilization of resources were studied which resulted in the improvement of managerial and supervisory approaches and achieved greater coordination between the Division of Accounting, Payroll, and Audit Operations and the Division of Data Processing.
The Department began to convert its payroll operations from punchcard and manual systems to a small-scale computer system. The newly developed departmental integrated appropriation accounting system will be placed on the computer during fiscal year 1965. This will result in complete centralization of accounting functions on a unified basis within the Office of the Administrative Assistant Secretary. Plans are being developed for the eventual computerization of budget processes as well as other financial management programs.
A reorganization created the Labor-Management Services Administration in order to develop a comprehensive labor-management relations program which will better provide staff assistance to the Secretary and which will marshal and make available to labor and management the research data and other resources needed to improve the climate of labor-management relations.
In response to President Kennedy’s memorandum of October 11, 1962, to heads of departments and agencies outlining his program for improving manpower control and utilization in the executive branch, the Department of Labor volunteered to be the first Government agency to have an independent review of its management improvement and manpower utilization practices. The review was conducted by a team representing the Bureau of the Budget, the Civil Service Commission, and the Department. Improvements were recommended in program planning, benefit-cost analysis,
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organizational structure, fragmentation of functions and responsibility, staffing control, and other areas. Where feasible, these recommendations were put into effect immediately; others are still in the process of implementation. The team submitted its report to the Secretary in February 1964.
PERSONNEL
The role and organization of the departmental personnel activity were modified substantially in fiscal year 1964. To provide more responsive services, personnel offices were established in administrations and the larger bureaus and offices, specifically in the Manpower Administration, Bureau of Labor Statistics, Bureau of Employees’ Compensation, Labor-Management Services Administration, Wage and Hour and Public Contracts Divisions, and Office of the Solicitor. One operating personnel office was established in the Office of the Administrative Assistant Secretary to service the Office of the Secretary and the smaller bureaus and offices. It is expected that the effectiveness and efficiency of personnel operations will benefit through a closer identification of personnel authority with the Department’s substantive programs. The role of the departmental personnel organization is to concentrate on the qualitative improvement of personnel management within the Department through planning, coordination, and guidance and the review and evaluation of administration, bureau, and office personnel operations and services.
To facilitate the transition to decentralized personnel operations, standard organization patterns and mission statements for personnel offices were developed, special interim instructions were written, and training was given to members of the new personnel staffs.
Further progress was made in the implementation of the Executive order on employee-management cooperation in the Federal service. Formal or exclusive recognition was granted to employee organizations for eight additional units. About 50 percent of the Department’s employees are now working in units for which employee unions have exclusive recognition. An agreement on merit staffing was negotiated with the union that represents most of the Department’s Washington, D.C., staff; and implementing regulations were issued for the Standards of Conduct for Employee Organizations, the Code of Fair Labor Practices, and the dues withholding program. To improve employee-management understanding, a program of regularly scheduled meetings between union and management representatives at various organizational levels was initiated in the Washington, D.C., area.
Major accomplishments in fiscal year 1964 include the establishment of written performance requirements for virtually every departmental position and the participation of almost all supervisors below grade GS-14 in a series of 5-day supervisory practices institutes.
Steps were taken to expand the program for improving supervision
749—199—65---2
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through an advisory service dealing with supervisors’ personnel management problems. Continued emphasis was given to the program of bringing about full and appropriate utilization of employee skills and abilities, and helping to achieve the President’s goal of improved manpower use.
A substantial revision of the merit staffing program was completed and installed. Among other improvements, the revision is expected to provide more information to employees, permit better evaluation of candidates, and speed the filling of vacancies.
The Department’s professional and clerical recruiting activities continued to emphasize the selection of high-quality candidates. College recruiters visited 66 colleges and universities throughout the country interviewing candidates who had passed the Federal service entrance examination or its management intern option. Recruiters also tested and interviewed potential stenographers in high schools and colleges for appointment in the Department.
The Department of Labor Board of U.S. Civil Service Examiners announced examinations and established or maintained registers for eight nonclerical positions ranging in grade from GS-9 through GS-15.
The Department continued its intensive positive recruitment program to locate qualified, eligible minority group candidates for placement in all job classifications and at all grade levels.
New classification standards were developed for apprenticeship and training representative positions. A review of classification operations was conducted in the Labor-Management Services Administration.
Criteria were developed to evaluate the adequacy of position classification programs in administrations, bureaus, and offices.
New policies, objectives, and procedures were established for the classification of research positions in the Department.
Employment in the Department at the close of the fiscal year is shown in table 2.
ADMINISTRATIVE SERVICES
The chronic space shortage of fiscal year 1963 carried over into 1964 and continued to be one of the Department’s most pressing administrative problems. Departmental operations were housed in 24 widely separated buildings in the Washington, D.C., metropolitan area and, as before, this scattering of operations created hardships in administrative functions.
Work was centered on plans to reduce the number of locations and at the same time to consolidate each major organizational unit into one building, along with other functionally related organizations as space permitted. Toward this end, as of the close of the fiscal year the number of locations was reduced by six buildings; the Department’s field offices located within Washington, D.C., were consolidated in one building; the United States Employment Service for the District of Columbia, of the Bureau of Employment Security, and the District of Columbia’s
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Unemployment Compensation Board were moved into a new building constructed especially for these agencies and containing over 100,000 square feet of usable space; the Department’s publications distribution and supply operations were consolidated in one building; and selected program activities of the Department’s bureaus, offices, and administrations were relocated, resulting in more efficient operations.
In recognition of the Department’s space problems, work continued in developing plans for the construction of a new building in the District of Columbia capable of housing the entire Department of Labor headquarters. In addition, considerable emphasis was placed during the year on plans to consolidate space holdings in cities where departmental regional operations are located, and to upgrade substandard or marginal space throughout the entire field.
Installation of the IBM 1440 computer system and the subsequent conversion of the data processing operations to the computer system highlighted activities in the area in fiscal year 1964. The new system will permit faster and more expanded centralized data processing services.
The workload of the Division of Printing and Reproduction increased during the year. The number of printed units (impressions) increased by over 5 million, from 79,900,000 to 85,150,600.
A comprehensive property utilization program has been developed for the various activities of the Department. All requisitions are screened to insure that departmental excess and Government surplus items are used to the greatest extent possible in filling equipment requisitions. Under this program, the Department acquired surplus property from Government Services Administration and other Federal agencies valued at $128,551 during fiscal year 1964. Likewise, excess equipment valued at $28,976 was transferred between the various bureaus and offices.
A new inventory guide was developed for all items of nonexpendable property. This guide is of significant value in taking the annual inventory.
Consolidation of storage facilities for the departmental blank forms, publications, and supplies at the warehouse at 770 M Street SE. was completed. The low sales inventory system was installed in the warehouse, and considerable savings of man-hours in inventory control are expected. A continuing program of reviewing supplies of bureau forms and publications was established to identify material which is obsolete or otherwise of no further value and which may be removed from stock.
Significant repair and renovation projects were undertaken on the Main Labor Building at 14th and Constitution Avenue. These included installing fluorescent lighting in 252 rooms of the building and painting a considerable number of the rooms. Also, the exterior of the building was cleaned, mortised joints pointed up, and birdproofing of the building was begun. Plans were completed for renovating the basement of the Main Labor Building.
A total of 2,250 field personnel in 208 offices were serviced from regional centralized services offices located in Boston, New York, Chicago, Cleve
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land, and San Francisco. Limited services were provided for offices in the Kansas City and Atlanta regions. It is planned to fully staff these latter offices during fiscal year 1965.
A survey was conducted in the Chicago regional offices to evaluate the progress of the Regional Administrative Services Office, to refine and improve existing procedures and relationships, and to develop methods for providing additional services in the personnel and voucher auditing field. Pilot projects will be established in San Francisco, Chicago, and Atlanta regional offices to provide personnel services in fiscal year 1965-
LIBRARY
Library activities increased as new Department programs developed. A total of 20,312 reference requests were answered and 77,729 publications were circulated.
A total of 13,377 volumes were added and 901 were withdrawn, making a net increase of 12,476 in the cataloged collection.
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Table 1.—Appropriations and other authorizations, fiscal year 1964
Positions Amount
Salaries and expenses:
Bureau of Labor Statistics_________________________________________
Revision of Consumer Price Index________________________________
Bureau of International Labor Affairs______________________________
Area redevelopment activities______________________________________
Manpower development and training activities_______________________
Bureau of Apprenticeship and Training______________________________
Mexican farm labor program, compliance activities__________________
Bureau of Veterans’ Reemployment Rights____________________________
Bureau of Labor Standards__________________________________________
Labor-Management Services Administration___________________________
Bureau of Employees’ Compensation__________________________________
Women’s Bureau_____________________________________________________
Wage and Hour and Public Contracts Divisions_______________________
Office of the Solicitor____________________________________________
Trade adjustment activities________________________________________
Office of the Secretary____________________________________________
Working Capital Fund operations_________________________________
Total, salaries and expenses from general funds______________________________
Unemployment compensation for Federal employees and ex-servicemen. Employees’ compensation, claims and expenses_____________________________
Total, benefit and claims from general funds.
1,376 $16,345,000
151 1,320,000
71 842,000
45 8,500,000
585 130,000,000
559 5,460,000
164 1,300,000
76 784,000
317 3,470,000
660 7, 500,000
541 4, 275,000
84 785,000
1,818 19,300,000
495 4,420,000
12 150,000
219 2,219,000
400 —
7, 573 206,670,000
152,842,000
72,000,000
224,842,000
Trust fund authorizations:
Office of the Secretary_____________________________________________
Office of the Solicitor_____________________________________________
Bureau of Employment Security (salaries and expenses)_______________
Grants to States. _■________________________________________________
Reimbursement from Mexican farm labor supply fund (salaries and expenses) ____________________________________________:_______________
Administration of longshoremen’s rehabilitation program_____________
Total, trust fund authorizations.
Total, funds available________________________________________________
1,141
160
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1,308
138,000
127,000
12,400,000
425,000,000
1,300,000
60,000
439,025,000
8,881 $870, 537,000
Table 2.—Number of employees on the rolls of the Department of Labor as of June SO, 1964
Bureaus Total Full-time employees Other
Total D.C. Field Total D.C. Field
All bureaus: 9,238 8,849 4,814 4,035 389 104 285
Office of the Secretary 629 598 557 41 31 19 12
Office of the Solicitor. 429 426 256 170 3 3
Bureau of Labor Standards 290 289 170 119 1
Wage and Hour and Public Contracts
Divisions. . 1,764 1,789 75 1,750 305 1,445 393 14 3 11
Bureau of Labor Statistics _. 1', 556 73 1,163 63 233 14 219
Women’s Bureau. _ 10 2 2
Bureau of Employees’ Compensation Bureau of International Labor Affairs 573 571 161 410 2 2
177 165 165 12 12
Manpower Administration
Office of Manpower Administrator... Office of Financial and Management 22 12 12 10 10
Services. 52 46 46 6 6
Office of Manpower, Automation,
and Training... __ 291 282 255 27 9 8 1
Bureau of Apprenticeship and Train-
ing_ __ _ 577 577 115 462
Bureau of Employment Security Labor-Management Services Adminis- 1,854 1,803 1,168 635 51 15 36
tration. _. ... ___. 716 701 378 323 15 10 5
President’s Committee on Equal Employ-
ment Opportunity 61 60 60 1 1
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OFFICE OF INFORMATION, PUBLICATIONS, AND REPORTS
The Office of Information, Publications, and Reports is the principal Jink between the Labor Department and the public. An information clearinghouse, the Office seeks to inform the public of the Department’s work, its publications, facts researched and released by its various bureaus and offices, and labor legislation.
In achieving this end, the Office in fiscal year 1964 issued news releases and replied to thousands of inquiries from labor, business, and the public. In addition, it distributed weekly news packets to some 400 labor, 2,700 weekly, and 180 Negro newspapers, and other press organizations. It also coordinated the Department’s relationship with the press, radio, television, and other information media.
The Office reviewed publications issued by the bureaus and offices for consistency with Department policy, and compiled and edited publications of departmentwide significance.
During the year, the Office disseminated information about the Department to nearly a million persons through participation in approximately 100 conferences and conventions throughout the Nation.
Department representatives explained the provisions of Federal labor legislation to interested officials of labor and management, provided information to the public on a wide variety of subjects of Department concern, and emphasized the need for education and training to qualify for employment before audiences of youths and interested adults.
The Office’s visual services division produced art and designed visuals or acted as visual consultant for all major departmental publications and other visual media. Several hundred miscellaneous “idea roughs,” publication layouts, and “format” designs were developed. From these presentations, publications, flyers, posters, television spots, slide films, training charts, and exhibits were produced. These were made available to the Department for national and international use.
In addition, a permanent exhibit hall, to be housed in the main building, was designed. Work on design and construction for exhibits, artifacts, and historic mementos of the history of labor and the Department is still in progress.
Also during the fiscal year, the Office issued revised editions of two of its publications, “U.S. Department of Labcr,” an explanation of the Department’s organization and functions; and “Important Events in American Labor History, 1778-1963,” a chronology of major labor events.
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OFFICE OF THE SOLICITOR
The Solicitor is the chief legal officer of the Department as well as a policy official and adviser. He advises the Secretary, the Under Secretary, and the Assistant Secretaries, and also performs many diversified types of legal services which are required in the operations of the various bureaus and offices of the Department. One of his more significant areas of responsibility is the handling of legal proceedings arising under laws administered and enforced by the Department. He also serves as top legal adviser to the Secretary in formulating and preparing the Department’s legislative programs, and in appearances before congressional committees.
In addition to these functions, the Solicitor is authorized to perform operating functions in connection with the administration and enforcement of the Davis-Bacon Act and other statutes relating to the predetermination and payment of prevailing wages on Federal and federally financed and assisted construction projects. He testified at length during the year before a House general labor subcommittee on the administration of these laws. The Solicitor is also vested with final authority with respect to tort claims arising out of the Department’s activities.
Functionally, the legal staff of the Solicitor in the Washington office is comprised of five divisions, with an Associate Solicitor in charge of each. The immediate Office of the Solicitor is composed of the Solicitor, his Deputy, and several attorneys as special assistants assigned to the handling of special legal problems.
In addition to the Washington office, a staff of attorneys is maintained in field offices throughout the United States and Puerto Rico, principally to carry out the litigation responsibilities of the Department.
LITIGATION DIVISION
The Litigation Division is charged with the Department’s litigation and quasi-litigation responsibilities, except as specifically otherwise assigned. These functions are performed principally in connection with the enforcement of wage-hour, workmen’s compensation, and maritime safety laws.
Wage-Hour Litigation
The number of court cases instituted during fiscal year 1964 under the Fair Labor Standards Act and the Walsh-Healey Act reached an alltime high of 1,608, of which 1,559 were civil actions and 49 criminal prosecutions. A total of 1,557 court cases were closed, with 1,507 favorable civil
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dispositions and 41 criminal convictions. In addition, 34 formal administrative proceedings were instituted under the Walsh-Healey Act, and 35 were closed.
Restitution of almost $3,100,000 was made to employees for wage underpayments, consisting of about $2,900,000 paid as back wages under the FLSA and $190,000 paid as liquidated damages under the Walsh-Healey Act. Fines in criminal proceedings totaled $73,638, and in contempt proceedings $29,940.
Forty-one briefs were filed in appeals under the Fair Labor Standards Act and the Walsh-Healey Act—four in the Supreme Court and the remainder in the courts of appeals. Twenty-six decisions were handed down by the courts. The Department’s position was upheld in 17 and rejected in 7; in the remaining 2, the Department was successful in part.
Legal assistance, including representation at formal administrative hearings and participation in prehearing activities, was provided in connection with wage-determination proceedings under the Walsh-Healey Act in nine industries, in four of which determinations were issued within the fiscal year. Two determinations under the act were challenged in the courts. One was set aside; the other is still in litigation.
Employees’ Compensation
The Litigation Division renders legal services to the Bureau of Employees’ Compensation in the administration of the several Federal workmen’s compensation statutes. These statutes provide benefits to employees and their families in the event of injury or death occurring in the performance of duty. The Division also defends the administrative decisions of the Bureau in appeals taken by Government employees to the Employees’ Compensation Appeals Board. There were 354 such appeals in the fiscal year. With respect to claims of nongovernment employees covered under the Longshoremen’s and Harbor Workers’ Compensation Act and related statutes, the Division participates with the Department of Justice in defending the administrative adjudications of the Bureau’s Deputy Commissioners in the courts. The number of cases in which the Division participated rose this year to a high of 82 from last year’s total of 61.
The Division also supervises the prosecution of private claims against persons responsible for injuries to Government employees, in order to assure maximum reimbursement to the Government out of the proceeds of recoveries for the compensation paid by the Government under the Federal Employees’ Compensation Act. Gross recoveries during the year on such claims amounted to $3,532,159-37. After deducting the expense of recovery, a net of $2,557,031.73 remained available for offset against compensation paid or payable by the United States to its employees or their dependents. Both of these figures set records. From the net recoveries, reimbursement was made to the Government in the amount of $686,296.22, and credit for medical bills paid was allowed in the amount of $87,158.30. Thus the
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total immediate benefit to the United States was $773,454.52. The remainder of the net recovery became available for credit against future liability upon the same claims.
Maritime Safety Standards
Another function of the Division is to furnish legal services to the Bureau of Labor Standards in connection with its enforcement of the maritime safety program under the Longshoremen’s and Harbor Workers’ Compensation Act. In the course of the fiscal year, five cases charging violations were brought before hearing examiners. Cease-and-desist orders were obtained in each. Two court cases resulted in injunctions to restrain violations, and one criminal prosecution resulted in the assessment of a fine of $3,000.
INTERPRETATIONS AND OPINIONS
At an overall record level were the number of written and oral opinions issued and reviewed, the legal questions considered and disposed of in reviewing proposed correspondence, the legislative materials, contracts, and other documents—including material for the Federal Register—and the conferences involving legal questions. More than 45,000 items in these areas were handled by the Division of Interpretations and Opinions during fiscal 1964.
In addition to the continuing demands of established programs for legal advice and services, the Equal Pay Act of 1963, the acceleration of activities under new programs such as the Manpower Development and Training Act, as amended, and the Contract Work Hours Standards Act, and legal services required as a result of congressional consideration of a variety of proposals of concern to the Department contributed to the increased workload.
An interpretative bulletin on the Equal Pay Act of 1963 was prepared and published in the Federal Register prior to the general effective date of this act, an amendment to the Fair Labor Standards Act. Revisions of several interpretative bulletins on provisions of the Fair Labor Standards Act were also prepared and published to clarify the application of amendments to the law and give effect to authoritative judicial and administrative decisions.
During fiscal 1964, this Division answered more than twice as many requests for opinions on questions under the Contract Work Hours Standards Act as in fiscal 1963. Actions taken under the provisions of section 105 for reasonable limitations, variations, tolerances, and exemptions from the act included regulations limiting geographical coverage of contract work under the act to areas within which the Fair Labor Standards Act is applicable. This permits the computation of the “basic rate of pay” in accordance with rules applicable to computation of the “regular rate” or other rate authorized under the Fair Labor Standards Act as the basis for computing overtime compensation.
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In the unemployment compensation area, in addition to handling a variety of important questions involving the conformity of State laws and regulations with Federal requirements, consideration was given to the relationship between State unemployment insurance benefits and trade readjustment allowances under title III of the Trade Expansion Act. Legal services were provided in connection with the development and implementation of legislation (Public Law 88-173) relating to methods by which amounts made available to States pursuant to the Temporary Unemployment Compensation Act of 1958 and title XII of the Social Security Act are to be restored to the Treasury of the United States.
With an expanded program under the Manpower Development and Training Act, there was a corresponding increase in the legal services required. In addition to furnishing all necessary legal advice on questions arising under the program, the services provided included the preparation of all contracts for demonstration programs under the act and the drafting and publishing of regulations to implement the recent amendments to the act. In the litigation involving foreign labor programs pending during the past year, the decisions of the U.S. District Courts upholding the Government’s position were affirmed on appeal. (Texas State AFL-CIO v. Kennedy, 330 F. 2d 217; Limoneira Co. v. Wirt^, 327 F. 2d 499, affirming 225 F. Supp. 961.)
In the veterans’ reemployment rights area, the volume of legal opinions prepared and reviewed and the number of cases referred to the Department of Justice were again at a high level. A “Legal Guide and Case Digest” was published and distributed in two looseleaf volumes which will be kept up to date by continuing revisions as additional judicial interpretation of the statutes becomes available. During the 1964 fiscal year, two important decisions of the U.S. Supreme Court (fiTilton v. Missouri Pacific Kailroad, 84 S. Ct. 595, and Brooks v. Missouri Pacific Kailroad, 84 S. Ct. 578) provided additional clarification of the “escalator principle.” Under this principle, except for those rights dependent on a bona fide actual work experience, ex-servicemen are assured all the advancement of position, status, and seniority rights which they could have claimed had they remained in continuous employment during their period of military service.
Documents published in the Federal Register pursuant to provisions of the Administrative Procedure Act and the Federal Register Act numbered 215 for the fiscal year, of which 75 provided new or amended provisions in the Code of Federal Regulations. One hundred and eighty-seven minimum wage orders for industries in Puerto Rico and the Virgin Islands were prepared and published.
Put into effect or strengthened during the year were regulations and standards designed to insure that discrimination because of race, creed, or color will not be permitted to exist in the administration of apprenticeship training programs, employment service activities, and the State employment security agencies’ personnel administration.
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WAGE DETERMINATIONS
The Division of Wage Determinations performs operating functions under the Davis-Bacon Act, its related prevailing wage statutes, the Copeland Act, the Contract Work Hours Standards Act, and Reorganization Plan No. 14 of 1950. The Division’s Branch of Wage Determinations determines minimum wages on Federal and federally assisted construction to be paid laborers and mechanics on contracts subject to the Davis-Bacon Act and related prevailing wage statutes. The Branch of Coordination and Enforcement administers functions vested in the Secretary by Reorganization Plan No. 14 of 1950, the purpose of which is to achieve coordination of administration and consistency in the enforcement of the statutes covered by its provisions.
Improvement in procedures pertaining to the administration of the Davis-Bacon Act and similar prevailing wage statutes was accomplished by recent revisions of the Department’s regulations. The principal changes accomplished by these revisions are as follows:
® The administration of the act and its related prevailing wage statutes was facilitated by (a) making wage determinations effective for 120 calendar days from the date of their issuance, (b) providing a uniform procedure for the establishment of wage rates for classifications not included in determinations, and (c) giving the administering agencies more time for implementing changes in determinations.
• The prevailing wage determination process was improved by requiring the submission of available wage rate information by the agencies requesting determinations.
• The Copeland “anti-kickback” regulations were improved by eliminating the necessity of requests for permission to make payroll deductions where experience has shown that the policy and provisions of the Copeland Act will not be impeded.
• The coordination of the administration of the labor standards provisions of the various statutes subject to Reorganization Plan No. 14 of 1950 was aided by providing realistic reporting procedures.
• The debarment provisions under Reorganization Plan No. 14 of 1950 for labor standards violations were improved by permitting flexible debarment (up to 3 years) and by providing for removal from the debarred bidders list upon a demonstration of current responsibility to comply with the labor standards provisions subject to Reorganization Plan No. 14.
® The Wage Appeals Board was created to review wage determinations, debarment cases, assessments of liquidated damages under the Contract Work Hours Standards Act, and controversies concerning the payment of prevailing wage rates or proper classifications of laborers or mechanics which involve significant sums of money, large groups of employees, or novel or unusual situations.
The 1964 amendments to the Davis-Bacon Act (P.L. 88-349) are of particular significance in terms of the Division’s responsibilities under the
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act. Among other things, the amendments provide for the inclusion of certain bona fide fringe benefits in prevailing wages under the act.
During fiscal year 1964, the following proposals were enacted which contain Davis-Bacon provisions to be administered by the Division: Health Professions Educational Assistance Act of 1963, Mental Retardation Facilities Construction Act, Community Mental Health Centers Act, Higher Education Facilities Act of 1963, Vocational Education Act of 1963, and the Library Services and Construction Act.
The Branch of Wage Determinations issued 43,186 wage determinations during fiscal year 1964. In all, 36,687 items of correspondence were issued in connection with these determinations.
The Branch of Coordination and Enforcement opened 1,407 enforcement cases. A total of 1,671 cases were processed to completion, a number exceeding those closed in any previous fiscal year under the Reorganization Plan. In cases involving serious violations of the various statutes within the scope of Reorganization Plan No. 14 of 1950, ineligibility sanctions were imposed against 27 contractors responsible for such violations. As a result of enforcement actions, restitution totaling $463,794.60 was secured for 4,247 laborers and mechanics.
LABOR-MANAGEMENT LAWS
The Division of Labor-Management Laws is responsible for supervising and coordinating the Department’s enforcement functions under the Labor-Management Reporting and Disclosure Act of 1959 and the Welfare and Pension Plans Disclosure Act, and for rendering legal advice and services to the Office of Labor-Management and Welfare-Pension Reports.1
During the fiscal year, the Division considered 309 cases involving the LMRDA for possible civil or criminal litigation. Thirty-four civil actions were instituted in the Federal district courts and 80 cases were transmitted to the Department of Justice for criminal prosecution. Of the civil actions instituted, 25 involved violations of the election provisions of the act, 6 actions were brought to compel the filing of reports as required by title II, and 3 actions were instituted to enforce administrative subpoenas issued by the Director of LMWP. During the same period, relief was granted to the Government in 13 cases. The Division also participated in six defensive actions brought against the Secretary in the Federal courts, with two cases resulting in judgments for the Government.
Several important and far-reaching court decisions involving the LMRDA were rendered during the past year. In Altman v. Wirt^, 56 LRRM 2651 (U.S.D.C., D.C., 1964), the court held that it was not authorized to direct the Secretary to file suit under title IV where the Secretary had, in the
1 On Aug. 21, 1963, the Bureau of Labor-Management Reports, which administered the LMRDA of 1959, and the Office of Welfare and Pension Plans, which administered the WPPDA, were merged to form the Office of Labor-Management and Welfare-Pension Reports (LMWP). LMWP now administers both of these acts.
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exercise of his discretion under his statutory authority, decided against litigation. Other important decisions include the holding that (1) the Secretary’s determination of “probable cause” to believe that a violation has occurred in an investigation under title IV is conclusive, Wirtz v. Local 30, International Union of Operating Engineers, 34 F.R.D. 13 (S.D., N.Y., 1963); (2) the 60-day period set forth in section 402(b) was not mandatory but rather directory, Wirtz v- Local 611, International Hod Carriers' and Common Laborers' Union, 229 F. Supp. 230 (D.C., Conn., 1964); (3) injunctive relief may be granted in actions under title IV notwithstanding the lack of express statutory authority, Wirtz v- Local 1752, International Longshoremen s Association, 56 LRRM 2303, 49 L.C. 18,998 (S.D., Miss., 1963); and (4) the Secretary is authorized to investigate union elections under section 601 even though no complaint was filed with him pursuant to section 402 of the act, Wirtz v. Local 191, International Brotherhood of Teamsters, 321 F. 2d 445 (2 Cir., 1963).
The Division participated during the year in one hearing before the U.S. Board of Parole wherein a certificate of exemption from the prohibitory provisions of section 504 was being sought. One hundred and seventy-five private suits involving the LMRDA were reviewed by the Division, including two cases in which petitions for certiorari were granted by the U.S. Supreme Court. The Division prepared the Department’s comments on these cases for presentation to the Supreme Court.
One civil action was commenced under the WPPDA to compel the filing of a corrected plan description and the annual reports required by the act. Two civil actions instituted during the previous fiscal year were favorably concluded by the parties agreeing to file the necessary reports. The Division also participated in one defensive action brought against the Secretary under the WPPDA.
The Division rendered extensive legal assistance to LMWP in preparing regulations, reporting forms, and various technical assistance aids and other publications. Included in the above were the (1) complete recodification of all regulations issued under the LMRDA and WPPDA, (2) preparation of the Removal of Officer Regulations issued under sections 402(h) and 402(i) of the LMRDA, (3) revision of the Interpretative Bulletin on Labor organizations relating to “State or Local Central Bodies,” (4) preparation of regulations regarding the granting of exemptions from the WPPDA bonding requirements, (5) preparation of the interpretative bulletin on retention of records requirement under the WPPDA, and (6) revision of the various reporting forms required by sections 6 and 7 of the WPPDA.
The Division also compiled the “Legislative History of the Labor-Management Reporting and Disclosure Act of 1959, Titles I-VI” which was published in June 1964.
The Division rendered approximately 3,150 written opinions under the LMRDA and approximately 2,570 written opinions under the WPPDA.
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LEGISLATION
There are five areas of responsibility in the Division of Legislation: (1) Legislation, (2) labor-management relations and general legal services, (3) hearing examiners, 0) decision writing, and (5) research, analysis, and reference.
The activities of the Division’s staff in the preparation of legislative proposals, testimony, analyses, explanatory statements, and other legislative materials for the Secretary and other Department officials continued at a high level during the second session of the 88th Congress.
These activities culminated in the enactment of a number of important items on the Administration’s legislative program. The Department has direct responsibility for administering two of these laws—the fringe benefit amendments to the Davis-Bacon Act and the Manpower Development and Training Act amendments.
Other important Administration measures were the subject of congressional hearings during fiscal 1964, and subsequently became law. Among these was the Civil Rights Act of 1964, on which the Legislative Division prepared testimony for presentation before four congressional committees and furnished technical legal services to the Department of Justice and congressional committees, particularly with respect to the fair employment practices provisions. Another of these very important measures was the Economic Opportunity Act of 1964, commonly called the Poverty Bill. The Associate Solicitor for the Division of Legislation participated, with an interdepartmental committee, in drafting this legislation, which incorporates in a broad package several proposals advocated by the Department in previous years. The Division s services were also utilized in hearings on the bill, subsequently enacted, to establish a National Commission on Automation and Technological Progress.
The FLSA Amendments of 1964, the Appalachian Regional Development Act, and the Overtime Penalty Pay Act are significant among other measures for which the Division prepared testimony and furnished technical legal assistance to congressional committees.
The Division also prepared testimony and furnished drafting services for the special railroad legislation creating the arbitration board wnich aided in resolving the prolonged railroad dispute.
The preparation of reports to congressional committees and the Bureau of the Budget expressing the Department’s views on proposed and pending legislation continued at a high level of activity during the fiscal year 1964. Many of the reports involved extensive legal analysis and policy coordination with officials of the Department and other Government agencies.
An important function of the attorneys engaged in labor-management relations and general legal services activity is to provide advisory legal services to the Office of the Secretary and other offices and bureaus of the Department not otherwise serviced and to prepare letters for the signature of departmental officials. As an indication of the high level of activity
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of this and the legislative function, the staff prepared 730 analyses, memoranda, and orders, 773 letters for the Secretary’s signature, and 2,804 letters for the signature of the Solicitor during the past year. In addition, it performed other legal functions, such as reviewing contracts entered into by the Department,
The hearing examiners held 50 hearings during the year pursuant to various laws administered by the Department of Labor. Most of these hearings (34) involved alleged violations of the Walsh-Healey Public Contracts Act, and 26 decisions were rendered in these cases.
The staff writes decisions for (1) the Employees’ Compensation Appeals Board in the administration of the Federal Employees’ Compensation Act and (2) the Secretary of Labor and the Administrator of the Wage and Hour and Public Contracts Divisions in connection with the administration of the Walsh-Healey Public Contracts Act. It also provides them a variety of other legal services with respect to problems arising under these statutes. During the year, a total of 275 decisions were written.
During 1964, the staff was also engaged in preparing legislative histories of the Fair Labor Standards Amendments of 1961, the Equal Pay Act of 1963, and the Davis-Bacon fringe benefit amendments; digests of key opinions rendered in the past on the Walsh-Healey and Davis-Bacon Acts; digests of current Solicitor’s opinions in all areas; and reports and miscellaneous legal documents.
749-199—65—3
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MANPOWER ADMINISTRATION
MANPOWER ADMINISTRATION
For the Department of Labor’s expanded manpower program, fiscal year 1964 was marked by a greatly accelerated rate of training project approvals, and the development of new avenues of basic manpower research.
The Manpower Administration, established in early 1963 to better carry out the intent of Congress in its passage of the Manpower Development and Training Act, directs and coordinates the efforts of the Bureau of Employment Security, the Office of Manpower, Automation, and Training, and the Bureau of Appenticeship and Training. In addition to the direct relationship the Manpower Administration bears to these three agencies, it also reviews and seeks to add greater cohesion to all manpower-related activities of the Department.
Basically, during fiscal year 1964, the Manpower Administration has greatly improved the Department’s capacities to fulfill the MDTA mandate of the Congress to the Secretary of Labor to ‘ ‘ determine the skill requirements of the economy, develop policies for the adequate occupational development and maximum utilization of the skills of the Nation’s workers . . . (and) promote and encourage the development of broad and diversified training programs. ’ ’
Responsibilities for training activities under the Manpower Development and Training Act are now assigned to each of the three bureaus, with this division of assignments based upon three differing kinds of projects.
The Bureau of Employment Security, which administers the Federal-State employment security system, directs the institutional training phase of the program. Far and away the most extensive phase, institutional projects represent the basic training tool of the act. Trainees in these projects are unemployed or underemployed workers being trained in various vocational institutions for demand occupations. They are recruited and assigned to courses through the local facilities of the State employment services.
Fiscal year 1964 witnessed a dramatic increase in trainee participation in institutional courses. Over 1,900 projects for 114,503 individuals were approved, the latter figure more than double that compiled during all of fiscal year 1963. That rate of acceleration should continue with the increasing approvals of large multioccupational projects, often conducted on a statewide basis. Two notable examples of these in fiscal year 1964 were projects to train 3,530 Alabama workers in 28 different occupations and more than 3,000 Oklahoma workers in 29 occupations.
A second category of projects involves the on-the-job training phase of the program, administered by the Bureau of Apprenticeship and Training.
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This is the time-tested methods of training used traditionally by employers to meet their skill needs. Its role under the MDTA is related to equipment and instructors often available only at the plant site, and to a willingness on the part of participating employers not only to train an unemployed worker but to hire him on a full-time basis upon the completion of his course. Representing a smaller facet of the MDTA training program, the rate of growth in OJT activity during fiscal year 1964 was nevertheless highly significant in terms of its probable use in the future. Trainee approvals for these projects were fully six times as high as they were in fiscal 1963. Some 10,292 workers were approved for training in 740 separate projects. Participating employers numbered 328.
A third phase of the MDTA program relates to the fact that many of the Nation’s hard-core unemployed are incapable of qualifying for either institutional or on-the-job training. Most frequently, these are the under-educated, non-English speaking, migrant workers, out-of-school and out-of-work youth, the handicapped, rural workers, and others who cannot qualify for training projects.
For individuals such as these, the Department of Labor has developed, under the MDTA, special experimental and demonstration projects. In human terms, the experimental and demonstration concept means 500 school dropouts in Cincinnati being counseled and referred to the kinds of jobs best suited for them. It means 120 Negro and Puerto Rican boys in New York City being counseled and trained on a “ladder technique’’ basis, beginning as service station attendants and gradually progressing to higher skills. It means the coordination and study of comprehensive training projects for older workers in five States. It means a specialized program in New York for counseling and testing the emotionally disturbed unemployed.
Experimental and demonstration projects, which are under the direction of the Department’s Office of Manpower, Automation, and Training, tripled in volume over the course of fiscal 1964. There were 27 approved, serving 20,107 individuals, as opposed to only 9 the previous year. Through this particular program, the Department hopes to learn more about specific kinds of unemployment, and thus develop knowledge that might prove of nationwide application.
Closely allied to the experimental and demonstration program and also administered by the Office of Manpower, Automation, and Training is the Department’s broad program of manpower research. During the fiscal year, there were approved 40 new research projects dealing with a wide variety of problems in the interrelationship between automation, our modern economy, and our present employment and unemployment trends. Project studies dealt with such topics as management decisions to automate, new manpower requirements in the field of technical information, the formal training backgrounds of adult workers, the decisions of some unemployed workers to forgo training opportunities, and a number of similar areas directly affecting the Nation’s manpower posture. In its conduct of the
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research program, the Department has drawn upon the best available resources of not only governmental agencies but private institutions as well.
The Manpower Administration is also responsible for overseeing training activities carried out under the Area Redevelopment Act. Although ARA is a more modest program than MDTA in terms of retraining the unemployed, ARA trainees nevertheless totaled well over 34,000 by the end of the fiscal year, including 11,928 approved during fiscal 1964. Since the program’s inception, in 1961, unemployed workers in 180 depressed areas have benefited from the ARA’s training provisions.
Two other developments in the Department of Labor’s manpower program were of special significance during the course of the year. To relieve a severe, national shortage of trained counseling personnel in the field of youth employment, the Department sponsored 8- to 10-week courses to train 2,000 counselor aides and youth advisers. These individuals were drawn from over 21,000 candidates for the course, and they received academic instruction at 27 universities around the country. Upon completion of their courses, they were to be referred to State employment service offices or to private agencies with particular interests in youth employment.
A second program begun during the fiscal year involved special counseling and referral services for youths rejected by the Armed Forces. A prior study had indicated that about one in three of all individuals undergoing preinduction examination failed to meet either physical or mental standards. It was also found that these individuals were frequently unemployed. Under the new program, carried out in cooperation with the Selective Service System, draft rejectees are now automatically referred to their local office of the State employment service for job counseling, as well as to other public and private agencies which might be of assistance to them in planning their futures.
The central question before the Manpower Administration, as it completed fiscal year 1964, was that of the Nation’s intensified need for accelerated job creation. While the economic upturn of 1962 and 1963 resulted in the addition of 2 million new jobs in the Nation, technological advance and expanded population growth make this task even more demanding in the years immediately ahead. During the final 5 years of this decade, about 18 million additional jobs will be required if we are to attain, by 1970, what can be termed a full employment economy. This requirement will continue to be the principal concern of the Manpower Administration.
The respective reports of the three basic agencies of the Administration follow.
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BUREAU OF APPRENTICESHIP AND TRAINING
BUREAU OF APPRENTICESHIP AND TRAINING
The Bureau of Apprenticeship and Training, operating through 275 field representatives in 12 regional and 156 field offices throughout the United States, promotes and helps develop and improve programs of apprenticeship and other on-the-job training in all crafts and other apprenticeable occupations.
It administers and directs the on-the-job training portion of the Manpower Development and Training Act in cooperation with management, labor, and State and community agencies.
It also administers a program of industrial training for foreign nationals in the United States under sponsorship of the Agency for International Development, the United Nations, the International Labor Organization, and other agencies.
The Bureau sets guidelines for apprenticeship standards; it does no actual training. Apprentices are employed workers at progressive wage scales who gain practical experience and related instruction.
Apprenticeship programs are the responsibility of industry. Local management and labor cooperate when workers are organized; management develops and directs the program alone when its labor force does not have organized representation. Labor-management apprenticeship committees oversee training in approximately 370 apprenticeable occupations.
Most apprenticeships are of 4 years’ duration, although some terms are from 2 to 6 years. When their term is completed, apprentices are awarded certificates as journeymen.
There were during the year an estimated 225,000 to 250,000 apprentices; about 163,000 were in programs registered under Federal or State agencies.
During the year, 1,139 new apprenticeship and 992 industrial training programs were developed and installed in industry by the Bureau. These programs equaled about 8 million training weeks.
A total of 3,650 apprenticeship and training programs were examined for program content and adherence to Federal apprenticeship standards. About 3,200 significant improvements in the organization, content, and administration of training programs were realized through Bureau efforts.
Certificates of registration were issued to 1,145 programs.
Certificates of completion were awarded to 6,465 apprentices.
Special attention was given this year to the 758 locals of the International Printing Pressmen and Assistants Union, AFL-CIO. A total of 448 visits were made to such locals to help improve and expand apprenticeship programs and journeyman training.
National apprenticeship standards were approved and adopted for
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stationary engineers, operating engineers, the sign and pictorial display industry, and truck mechanics through the American Trucking Associations and the International Association of Machinists, AFL-CIO.
A variety of Bureau publications were used in promotional and informational activities and nearly a half million pieces of literature were distributed. Bureau exhibits were displayed and representatives attended more than 30 labor and management conventions and conferences.
EQUAL EMPLOYMENT PROMOTION
Since adoption in January 1964 of Federal regulations (CFR 29, Subtitle A, Part 30) pertaining to nondiscriminatory practices in selection and operation of apprenticeship programs, all new apprenticeship registrations of programs by the Bureau—383 from January through June 1964—have been in conformance with the new regulations.
Examples of selection procedures were issued as guidelines to aid in compliance. Five State plans were reviewed and one was approved during the year. More than a third of the remaining States which have apprenticeship councils have submitted plans for review by the U.S. Department of Labor Equal Opportunity Review Committee.
The Bureau’s Advisory Committee on Equal Opportunity in Apprenticeship and Training held six meetings with the assistance of a newly appointed executive secretary and three full-time and eight part-time industrial training advisers.
Four new apprenticeship information centers were established in Boston, Chicago, Cincinnati, and Detroit with the cooperation of the Bureau of Employment Security. These centers, pioneered in the District of Columbia, provide counseling service and aptitude testing for youth and serve as channels for placement with cooperating labor and management organizations. The emphasis is on qualifications alone, without regard to race, color, creed, or national origin.
MDTA ON-THE-JOB TRAINING
More than 10,200 unemployed and underemployed workers were scheduled for on-the-job training programs during fiscal year 1964 under the Manpower Development and Training Act. The Bureau negotiated and developed 328 contracts with employers, unions, employer associations, joint apprenticeship committees and city, State, and local governments to provide this training.
Training in more than 100 occupations was represented. Training costs were set at $5,330,166 to be paid from Federal funds. Nearly $10,000,-000 in wages were scheduled for payment to trainees by employers under the contracts.
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INTERNATIONAL ACTIVITIES
Apprenticeship and training methods in 35 different industrial fields were observed by 79 labor and government officials from 26 foreign countries through itineraries developed and scheduled by the Bureau.
Sixty participants completed training programs in the United States.
Special labor and technical teams, 15 in number, completed special tours. They represented Indonesia, Bolivia, Turkey, Ryukyu Islands, and Venezuela.
The Agency for International Development sponsored a tour of the Bureau’s administrator to eight Central and South American nations during the closing months of the fical year to create interest in apprenticeship and on-the-job training programs.
PUBLICATIONS
The Bureau’s research division published “The Training of Workers in American Industry,” providing for the first time an inventory of all types of training programs conducted or sponsored by private industry, and “Apprenticeship and Unemployment,” a popularized report on a technical study of the effects of economic change on the growth of apprenticeship in the United States.
The Bureau also issued a promotional booklet on ‘ ‘On-the-job Training under MDTA,” as well as two national apprenticeship standards for newly registered programs.
FEDERAL COMMITTEE ON APPRENTICESHIP
The Federal Committee on Apprenticeship (representatives from labor, management, and education) advises the Secretary of Labor and counsels the Bureau. The committee held six meetings to consider subcommittee studies on apprenticeship, pre-apprenticeship, apprenticeship and defense contracts, and subsidies and apprenticeship.
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Registered apprentices in training, new registrations, completions, and cancellations, 194-1-63 (adjusted to account for reporting revisions')
Year In training on Jan.1 New registrations 1 Completions Cancellations 2 In training on Dec. 31
1941 18,300 26,137 40,144 43,115 40,571 56,965 131,217 192,954 230,380 230,823 202,729 171,011 158,532 160,258 158,675 174,722 188,137 185,691 177,695 166,005 161,128 155,649 158,887 163,318 14,177 20,701 11,661 7,775 23,040 84,730 94,238 85,918 66,745 60,186 63,881 63, 055 73,198 58,970 66,747 72,869 58,463 50,134 63,679 58,129 48,889 55,590 56,992 1,289 2,011 1,715 2,122 1,568 2,042 7,311 13,375 25,045 38,533 38,754 32,752 28,378 27,176 24,445 26,508 29,760 29,824 35,741 30,920 28,282 25,918 25,900 5,051 4,683 6,975 8,197 5,078 8,436 25,190 35,117 41,257 49,747 56,845 42,782 43,094 33,377 26,255 32,946 31,149 28,306 39,628 32,086 26,086 26,434 26,661 26,137 40,144 43,115 40,571 56,965 131,217 192,954 230,380 230,823 202,729 171,011 158,532 160,258 158,675 174,722 188,137 185,691 177,695 166,005 161,128 155,649 158,887 163,318
1942
1943__
1944
1945
1946.
1947
1948
1949.
1950
1951
1952
1953
1954
1955
1956
1957
1958
1959*.
1960
1961
1962
1963 . -----
1964 --
♦Major revision in reporting system effected this year.
2 Cancellations are not synonymous with “dropouts” since they include layoffs, discharges, and out-ofState transfers as well as suspensions for military service and voluntary “quits.”
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BUREAU OF EMPLOYMENT SECURITY
Contents
Page
U.S. Employment Service.......................................... 48
New program developments..................................... 48
Placement and related services............................... 50
Manpower development and analysis............................ 52
Farm Labor Service............................................... 56
Domestic farm labor.......................................... 56
Foreign farm labor........................................... 58
Wage activities.............................................. 59
Unemployment insurance........................................... 60
Financing benefits........................................... 60
State legislation............................................ 62
Conformity hearings.......................................... 64
Training allowances.......................................... 64
Research and information..................................... 65
Administration............................................... 67
Special activities............................................... 68
Appendix tables
1. Selected employment service activities, U.S. totals for fiscal years 1956-64, by State for fiscal year 1964................. 69
2. Significant provisions in State unemployment insurance laws, June 30, 1964................................................ 70
3. Claims, beneficiaries, amount and duration of benefits under
State programs, U.S. totals for fiscal years 1955-64, by State for fiscal year 1964...................................... 72
4. Subject employers, covered employment, and selected unemployment insurance financial data under State programs, U.S. totals for fiscal years 1955-64, by State for fiscal year 1964......................................................... 74
5. Selected data on unemployment compensation for Federal employees, U.S. totals for January-June 1955 and fiscal years 1956-64, by State for fiscal year 1964....................... 76
6. Selected data on unemployment compensation for ex-servicemen, U.S. totals for October 1958-June 1959 and fiscal years 1960-64, by State for fiscal year 1964....................... 78
7. Disqualifications under State programs, by issue, U.S. totals for fiscal years 1953-64, by State for fiscal year 1964...... 79
749—199—65——4 45
BUREAU OF EMPLOYMENT SECURITY
The Bureau of Employment Security is the Federal partner in the Federal-State employment security system which encompasses two main programs— employment service and unemployment insurance. Under its basic legislation, the Wagner-Peyser Act and the Social Security Act, the system was designed primarily to obtain for applicants jobs which utilize their highest skills and capacities; to refer qualified employees to employers; to provide unemployment benefits as a partial replacement of wages lost during periods of involuntary unemployment, thus serving as a stabilizing influence on the economy by sustaining purchasing power; and to provide labor, management, government, and the public with labor demand and supply and other information available through the operations of the employment security program.
As employment and related needs of the Nation’s labor force changed, other responsibilities were placed on the employment security system. In addition to the above functions, local employment offices in fiscal year 1964 assessed manpower supply and requirement problems; worked with educational and training authorities for manpower development, training, and utilization; and worked with community groups for area economic development and stability. The unemployment insurance machinery of the employment security system was utilized for disbursing funds to individuals being trained for work under the Area Redevelopment Act and the Manpower Development and Training Act; also, that machinery was readied to carry out responsibilities under the Trade Expansion Act for payment of relocation allowances and trade readjustment allowances to workers who may be found by the U.S. Tariff Commission to be affected adversely by actions taken under that act. The system provided supplemental foreign farmworkers to growers when domestic workers were not available and took appropriate action to insure that their employment did not affect adversely domestic workers similarly employed.
The Bureau of Employment Security has a dual role. As a partner in the Federal-State relationship, its responsibility is to insure proper and efficient administration; to obtain, allocate, and insure proper expenditure of funds for administration of State employment security programs; to insure conformity of State laws and compliance of State administration with Federal requirements; and to provide leadership and assistance to the States in developing and carrying out a successful program. In its role as a Federal entity, the Bureau has more direct administrative and operational responsibilities. Among other functions, it makes recommendations with regard to Federal legislation; administers Federal unemployment compensation programs covering separated employees of the Federal Government and
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ex-servicemen; operates a system for interarea recruitment of labor among the several States; maintains a public employment service for the District of Columbia; and performs activities related to the importation of foreign workers.
Administrative costs for the operation of the programs are met from congressional appropriations, with 100 percent grants for program, administration apportioned by the Secretary of Labor to cooperating State agencies.
This report describes both Federal and State efforts with respect to employment security, since the best measurement of Bureau activities is the effectiveness of the employment security program at national, State, and local levels.
The Bureau carries out its program responsibilities through three services—United States Employment Service (which includes a Veterans Employment Service), Office of Farm Labor Service, and Unemployment Insurance Service.
U.S. EMPLOYMENT SERVICE
The Federal-State public employment service consists of the Bureau’s U.S. Employment Service (USES) and affiliated State employment services with their network of 1,900 local employment offices. The term “employment service’’ and the abbreviation “ES” as used herein apply to the joint Federal-State employment service.
During the year, 10.9 million new applications for work were filed by jobseekers at local public employment offices, and those offices made nearly 6.5 million nonagricultural placements and over 7.1 million farm placements.
New Program Developments
Youth Services
To help combat unemployment of youths under age 22, which averaged about 17 percent in the fiscal year, local ES offices registered approximately 3.7 million young men and women for employment and made over 1.5 million nonagricultural placements.
Through the Manpower Development and Training Act (MDTA), vocational training opportunities were provided to about 27,500 jobless youths. To help meet the needs of many communities and of State and Federal agencies for trained counselors to work with disadvantaged youths, provision was made for training about 2,000 persons as counselor aides and youth advisers.
Under a cooperative arrangement which began in February 1964 between the Selective Service System and State employment services, unemployed and underemployed young men who failed to meet education or intelligence standards of the Armed Forces were referred to local ES offices. By the end of the fiscal year, initial interviews were given to 28,572 Selective Service
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referrals; counseling interviews to 22,193; referral and placement service to 13,824. Enrollees in occupational training programs numbered 328.
By the end of fiscal year 1964, apprenticeship information centers were in operation in seven cities (Baltimore, Boston, Chicago, Cincinnati, Detroit, Philadelphia, and Washington, D.C.) with large numbers of unemployed youths. These centers were established in cooperation with the Bureau of Apprenticeship and Training to provide information and to screen, select, and help place young apprenticeship applicants.
Special demonstration projects to provide better job market services to youths were continued in Detroit, Newark, and St. Louis. Emphasis was placed on providing continuity of contact with each youth by the same counseling staff member.
Local ES offices have cooperative arrangements with high schools to provide group guidance, counseling, testing, and placement to students entering the labor force. In the 1962-63 school year, the ES worked with more than half of the Nation’s high schools, registering 586,529 seniors. Programs for working with dropouts were reported by 46 State agencies.
Preliminary plans were made for establishing youth opportunity centers in cities where youth unemployment is a major problem, to serve as focal points for government and community efforts to aid all youths under 22 years of age to become employable and to find suitable work.
Vocational Education Act
Guidelines were developed for State agency agreements with State boards of vocational education, as called for in the Vocational Education Act of 1963. The guidelines provide for an exchange of labor supply and demand and training information by local ES offices and education agencies and for cooperation in counseling, testing, training, and placement.
Immigration Activities
As a result of arrangements with the Immigration and Naturalization Service (I&NS) and the Departments of Justice and State, under section 214(c) of the Immigration and Nationality Act, the ES began to implement its advisory role to I&NS by certifying as to availability of specific types of workers in the United States.
Job Vacancy Information
Experimental job vacancy surveys were made in the Chicago and Buffalo labor areas to collect data for use in economic analysis, planning manpower training and retraining programs, and identifying new job and placement possibilities. A series of 20 pilot projects was subsequently planned, in cooperation with the Bureau of Labor Statistics and the State employment security agencies concerned, to measure extent and nature of unfilled jobs by occupation and industry.
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Professional Placement Services
Services to professional and managerial personnel resulted in 249,100 placements.
To insure college graduates the widest possible choice of employment opportunities, an agreement was reached with the College Placement Council, Inc., for public employment office services—when requested—to supplement those of college placement officers in the over 2,000 colleges and universities represented by the Council.
Placement and Related Services
Nonfarm placements in fiscal year 1964, at 6,454,000, were down 2.7 percent from the previous year. Professional and managerial placements, however, at 249,100, were up nearly 1 percent. Construction placements, at 462,000, the highest since fiscal year 1956, were up 1.3 percent, and placements in durables manufacturing, at 648,900, also rose 1 percent. Placements declined in other occupational and industry groups.
Some 3,162,600 nonfarm placements were made in the 55 largest standard metropolitan statistical areas, a decline of 2.8 percent over the year. However, professional placements in those areas, constituting 72.3 percent of the national total in this occupational category, showed a 4.4 percent gain
Nonfarm placements, by occupation and industry, fiscal years 1963 and 1964
Fiscal year 1964 Fiscal year 1963 Percent change in 1964
Total*. 6,453,900 6,632,300 -2.7
By occupation: Professional and managerial 249,100 247,500 4-0.7
Clerical and sales 994,500 1,058,600 —6.1
Service — -- -- 2,093,800 2,145,200 —2.4
Skilled 358,700 370,300 -3.1
Semiskilled. __ — 862,900 875,200 -1.4
Unskilled 1,894,900 1,935, 500 -2.1
By industry: Construction 460,600 454,900 4-1.3
Manufacturing 1,403,100 1,438,400 —2.5
Durable 648,900 643,000 4-0.9
Nondurable - -- — - 754,200 795,400 —5.2
Public utilities 225,900 227,200 -0.6
Trade — 1, 522,600 1,560,300 -2.4
Service — 2,485,600 2,557,300 -2.8
Government 201,500 232,300 -13.2
All other 154,600 162,000 —4. 6
* Items may not add to total because of rounding.
Convention placement service, which brings together employers with job openings and interested applicants, was provided for 16 professional societies at their annual meetings—-a 45-5 percent increase from the previous year.
Interarea Recruitment
Testing continued of Project LINCS (labor inventory communications system), and the teletype network was expanded from 7 California stations
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to 17—the 10 others being outside that State. This experiment in the use of automatic data processing and telecommunications was designed to accelerate and strengthen local and interarea placement operations and to expedite national interchange of work force supply and demand information. A basic computer program for screening large volumes of worker qualifications against employer job order requirements was completed; it performed successfully under actual operating conditions.
Interarea recruitment was used in the placement of 161,535 workers; in assisting the International Labor Organization and other United Nations’ organizations to obtain applicants capable of providing technical know-how to other countries; and in recruiting teachers for dependents’ schools at Department of Defense installations.
Minority Groups
At the beginning of the fiscal year, barriers to completely desegregated service existed in seven local offices. By December 31, 1963, all local office facilities had been desegregated, and on-site evaluations were made to insure compliance with USES nondiscrimination policies.
As members of a Department of Labor team, Bureau representatives and managers of local offices concerned visited almost 100 predominantly Negro colleges to discuss employment problems with the students, graduates, college presidents, and placement officers, and to describe assistance available through ES facilities.
Employment service offices played a major role in the Plans for Progress program wherein many employers voluntarily signed pledges to provide equal opportunities for minority employees in hiring, promotion, and training. Contacts were made with these employers to develop job openings for Negro college graduates. The orders served a dual purpose—• as a source of job opportunities for the graduates and, for the schools, as an indication of the kinds of jobs for which major employers were seeking workers and the qualifications demanded.
Of the nearly 100,000 trainees who had been enrolled in institutional MDTA courses by June 30, 1964, about 26 percent were nonwhite.
Older Workers
Over 1,306,000 nonagricultural placements were made of workers age 45 and over, and more than 121,000 such applicants received counseling services. Guidelines were developed for State agency use to implement Executive Order No. 11141, issued February 12, 1964, “Declaring a Policy Against Discrimination on the Basis of Age by Federal Contractors and Subcontractors.”
Veterans
Veterans filed more than 1% million applications for work at local employment service offices, representing 21.5 percent of all new job applications filed by men; however, they obtained more than 28.5 percent of all
51
nonfarm job placements. Disabled male veterans, representing 36.7 percent of the handicapped men who sought jobs through the employment service, were placed in 47.1 percent of the jobs filled by handicapped men. As more veterans crossed the 45-year mark, their employment problem became almost synonymous with that of other older workers.
A special program was arranged with the Department of Defense for retired career military personnel, starting with on-base employment briefing sessions well in advance of retirement and, later, including employment counseling, aptitude testing, job information on selected cities and areas, and direct job-finding assistance.
The Handicapped
Applications filed by the handicapped with local ES offices decreased 2 percent, but placements increased 3 percent over the year to 281,142, mainly because of training provided under MDTA. Rehabilitated clients from vocational rehabilitation agencies accounted for 6,369 of the placements, a 10 percent gain from last year. Placements of disabled veterans rose 3 percent to 103,275.
A survey of employment and related services being provided to 200 mental hospitals indicated a greater demand for such assistance than local ES offices could meet with available staffs. ES offices provided testing, counseling, and placement services to Selective Service rejectees and to social security disability claimants; assisted in placing released Federal prisoners; and promoted MDTA training for all handicapped applicants.
Counseling and Testing
Local offices reported 2,008,356 counseling interviews during fiscal year 1964, and 1,188,881 applicants counseled. Aptitude and proficiency tests were given to 2,337,758 persons. Of these, 761,700 were given the USES General Aptitude Test Battery.
By the close of the fiscal year, 46 States had adopted separate counselor classifications, as recommended by the Bureau, but only 24 States fully met recommended standards. Nearly 1,000 counselors from 35 State agencies participated in out-service training courses at more than 100 colleges and universities. In addition, nine special institutes or workshop sessions for ES counselors were held on college campuses. Two universities established a master’s degree curriculum for employment service counseling.
Manpower Development and Analysis
Training Activities
Employment service responsibilities under the Area Redevelopment Act and Manpower Development and Training Act include providing labor supply and demand data, making surveys to determine occupations for training, recruiting, and selecting trainees, assisting in the development of training programs, and helping to place “graduate” trainees. Under the
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ARA, employment service responsibilities also include recommending areas for designation as redevelopment areas.
By June 30, 1964, ARA training had been made available to eligible residents of 44 States, American Samoa, and Puerto Rico. During the fiscal year, more than 11,000 trainees enrolled in ARA training courses, in addition to the 2,500 trainees carried over from the previous year; over 9,200 completed their training. Over three-fourths of the graduates obtained employment, mostly in training-related occupations.
Some 1,900 MDTA institutional projects for about 114,400 trainees were approved in 49 States, the District of Columbia, Puerto Rico, and the Virgin Islands during the fiscal year. Allowances and training costs totaled about $165 million, with nearly two-thirds earmarked for expenditure in fiscal 1964. About 70,000 trainees enrolled in training in over 1,600 projects during the year. About 70 percent of the 38,000 trainees who had completed MDTA courses between July 1, 1963, and May 1, 1964, had obtained employment by June 30, most of them in training-related jobs. Local offices made over 70 percent of trainee placements.
Nearly one-third of the MDTA trainees were preparing for skilled occupations, over one-fifth for semiskilled, and nearly one-fifth for clerical and sales jobs.
The December 1963 amendments to the Manpower Development and Training Act provided for up to 20 compensated weeks of basic education in addition to a maximum of 52 compensable weeks of occupational training; lowering the minimum age from 19 to 17 for youth training allowances; increasing the amounts available for youth training from 5 percent of total allowance payments to 25 percent of all trainees receiving allowances; increasing weekly training allowances by as much as $10 under some situations; permitting payment of allowances to trainees with 2 years of gainful employment and to members of families in which the head is unemployed; and providing for relocation assistance to workers on a pilot basis.
The MDTA amendments made it possible to extend training to untrained, inexperienced youths as well as to provide basic literacy skills to those who would otherwise fail to qualify for occupational training.
A new development—multioccupational training projects—accounted for about 40 percent of all trainees approved for MDTA training in fiscal year 1964. Trainees who required basic education, testing, and counseling were grouped together, were provided such training and service, and then were assigned to appropriate occupational training.
Labor Supply and Demand, by Area
Of the 150 major production and employment centers which the USES classifies monthly as to adequacy of labor supply, 37 in June 1964 were in categories reflecting substantial unemployment, as compared with 88 in June 1961 (the end of the first fiscal year in which monthly reporting was
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instituted). The highest number of major areas in the substantial unemployment category was 101 in March 1961.
June 1964 June 1963 June 1962 June 1961
Total, all groups (major areas) A (overall labor shortage) _ _ _ 150 0 150 0 150 0 150 0
B (relatively low unemployment) - 19 16 10 0
C (moderate unemployment) - - 94 95 89 62
D (substantial unemployment) - _ 32 28 42 63
E (substantial unemployment) _ 3 9 6 17
F (substantial unemployment) 2 2 3 8
The USES also identifies smaller and very small areas of “substantial” and “substantial and persistent” unemployment. A total of 715 areas, including the 150 major areas, were so classified in June 1964, compared with 802 in July 1963- These areas were eligible for preference in the award of Federal procurement contracts under Defense Manpower Policy No. 4 and the Buy American Act, and for special low-interest Small Business Administration loans. Defense contract awards to firms located in substantial unemployment areas from April 1963 to March 1964 (latest data available) totaled $4.0 billion, with $167.0 million resulting from special “set aside” preference awards. Areas of “substantial and persistent” unemployment, identified by USES, were recommended by the Secretary of Labor to the Department of Commerce for designation as redevelopment areas under the ARA and for eligibility under the Accelerated Public Works Act.
Because of concentrated unemployment problems in the central cities of large metropolitan areas, criteria were developed in cooperation with the Department of Commerce which permitted 9 cities of 250,000 or more population to be identified as eligible for ARA assistance.
Labor Information, by Occupation
During the year, more than 200 new or revised occupational guides were prepared by State employment services to provide basic information on job duties, requirements, and prospects, and to serve both counselors and individuals making occupational choices.
The Bureau’s area skill program was initiated in 1956 to provide analyses of current and future labor demand and supply by occupation for a specific area. Such analyses are made by State employment security agencies with technical assistance from the Bureau. They are used as manpower planning guides by counselors, school administrators, and industry and other community leaders. By the end of fiscal 1964, a total of 169 area skill survey reports had been published, including 19 occupational indexes.
Industry
Manpower surveys were prepared for the bituminous coal mining, tires and tube manufacturing, department stores, meatpacking, machine tool,
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and aerospace industries. These studies provided local offices with labor supply and demand information needed to carry out their operating responsibilities, and were useful for a variety of purposes at the national level.
Labor Operations Research
Thirty-four special studies of the characteristics of applicants and employers and the local office services provided to them were made by 19 State employment services. A new quarterly survey revealed that about 98 percent of verified nonfarm placements were of jobless workers.
Occupational Analysis
Preparation was almost completed of the third edition of the “Dictionary of Occupational Titles”—the first thorough revision since 1949. The new Dictionary, to be published before the end of fiscal 1965, will present current information on approximately 23,000 jobs and their requirements; a single classification structure; and job-related information, including training time, working conditions, and such worker traits as attitudes, interests, temperaments, and physical demands.
The eight occupational analysis field centers studied jobs in a variety of industries to develop information on occupations affected by technological changes in industrial processes and equipment and by the development of new materials and products.
Other job information projects to meet specific needs included a study of occupations in numerical control systems as applied to metal machining; a “Health Careers Guidebook,” covering occupations at all levels in health services and addressed to secondary school students and their counselors; and a guidebook for employment counselors, covering selected shortage occupations.
Occupational Test Development
A preliminary nonreading measure of general learning ability of the USES General Aptitude Test Battery (GATB) was developed for local office use in assessing the occupational potential of persons with limited education. A short, easily scored, objective screening device was also developed for counselors and interviewers to identify those persons for whom nonreading aptitude tests would be better measures of their abilities than the GATB tests requiring reading.
Occupational validations of the GATB included occupations for which training courses were established under the MDTA and the ARA as well as occupations emerging from technological changes.
A standardization study was completed on the Spanish-language edition of the GATB to make it more suitable for use in Puerto Rico.
Community Employment Development
Employment service representatives served as members of, or consultants to, about 4,000 local economic development organizations. Information
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was provided on employment trends, unemployment problems, demandsupply relationships, occupational shortages and surpluses, and manpower requirements and resources. Special surveys and projections of community skill demands were prepared, when needed, for the guidance of manpower planners and educators.
Representatives of ES offices participated in community efforts to expand existing firms, to attract new firms, and to secure job-generating governmental projects.
Employment services were extended to 27 rural areas remote from local offices. Mobile teams of State ES personnel moved from one rural county to another, providing counseling and placement services and preparing inventories of skills—actual and potential—for use in determining needs for ARA and MDTA training programs, and in attracting new industry to a community.
Manpower Mobilization Planning
An interim edition of the national manpower plan for defense mobilization was completed for inclusion in the national plan of the Office of Emergency Planning. Agreement was reached with the Department of Health, Education, and Welfare on a list of skills directly concerned with health services in an emergency; establishment of several preassigned manpower teams and prepositioning of standby orders for key civilian personnel; and development of a conversion table for translating Classification Act and Department of the Army Wage Board job titles and codes to comparable DOT titles and codes.
FARM LABOR SERVICE
The demand for seasonal agricultural labor continued to shrink in fiscal year 1964 as a result of extensive use of farm machinery, pesticides, and herbicides, together with improved farm practices. This decrease in employment opportunities was reflected in the drop in farm placements made by State employment security agencies—from 7,100,000 in fiscal year 1963 to 6,300,000. A large part of the drop occurred in cotton producing States during the cultivation period, when improved weed control reduced average seasonal worker employment and thereby the number of pool-type day-haul placements.
Although this report is issued on a fiscal year basis, the woikload figures that follow are for calendar year 1963, since agricultural activities do not lend themselves to reporting on a fiscal year basis.
Domestic Farm Labor
Placement Services
Placement service was extended to 7,236,440 farmworkers in calendar year 1963, about 15 percent fewer than the number served in the previous year. The placement drop encompassed 39 States.
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In farming areas located within commuting distance of population centers, day-hauls were used by many local offices to meet short-term labor needs. In day-hauls, workers were transported to and from job sites daily by means of private conveyances. About 68,900 workers were assembled daily in the 1963 agricultural season at day-haul points, supervised by local employment offices, for transportation to nearby fields. A total of 658 towns participated in the day-haul program, and another 1,400 towns had “established” day-hauls, for which local office representatives recruited and assigned workers on a seasonal basis. ES personnel visited such points periodically to insure that the program was operating effectively. Peak day employment for established day-hauls was 163,000 workers.
Day-haul programs were established specifically for youth at 945points; in 178 towns, State agencies operated day-haul programs especially for young workers, with total workers on the peak day numbering 12,102; and young workers participated in varying numbers in day-hauls operated and established for adult workers.
Another source of jobs to young people was “live in” employment. Local offices placed 2,241 youths in farm jobs where they lived right on the farm.
“Farm employment days” were used in placing many year-round farmworkers. They provided a means, at a central location, for personal interviews between available workers in a local area and farmers who were seeking workers. In 1963, over 100 local offices participated in this program, holding 1,085 “farm employment days.”
In small communities with a limited need for employment services, volunteer farm placement representatives were used to bring together job openings and workers. In 1963, over 2,650 such representatives in 25 States, working without pay and in close cooperation with public employment services offices, referred workers to 71,558 farm and related jobs.
Nine States provided farm placement services to 21,446 Indians living on reservations.
Employers in 12 States on the east coast and the Great Lakes contracted 13,040 farmworkers from Puerto Rico.
In 10 wheat States, 1,750 employers benefited from State employment service coordination of the movement of wheat custom harvest machinery from one area to another within a State; and 4,763 employers, from movement of machines from one State to another. In 11 cotton producing States, 276 employers benefited from an area-to-area service entailing the coordinated movement of cotton harvest equipment; 129, from a State-to-State service. At the end of the fiscal year, the latter service was discontinued because enough machines had become available in most cotton areas to bring in the harvests.
Migratory Farmworkers
The Bureau and State employment security agencies continued to implement the interstate recruitment regulations of the Secretary of Labor.
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Issued in December 1959, the regulations established standards designed to improve housing, working conditions, and transportation of migrant farmworkers.
Under the annual worker plan, designed to provide consecutive seasonal farm jobs, the number of migrant groups served in calendar year 1963 increased slightly over the year to 10,310, but the number of workers dropped 3 percent to 167,548; the number of children under 16 accompanying adults rose 2 percent to 45,448; and the number of crew work schedules issued, at 8,319, was down slightly from 1962.
Training Activities
During calendar year 1963, there were 39 ARA and 106 MDTA agricultural projects approved to train 4,803 workers in 32 States and Puerto Rico, up significantly from the preceding year. About 80 percent of the graduates of such projects were placed in training-related jobs, the highest placement rate of trainees in any major occupational group.
Foreign Farm Labor
Aliens for Seasonal Farmwork
Average monthly employment of foreign workers in the United States for seasonal agricultural employment in calendar year 1963 was 57,000— 14,000 below that of the previous year. The greatest number working at any one time was 105,000, about 17 percent fewer than in calendar 1962; the lowest number was 30,000.
The decline in use of Mexican nationals, which began in 1959 and continued through calendar year 1963, accounted for nearly all of the decrease in use of foreign workers. Average employment of Mexican contract workers dropped from 60,000 in calendar 1962 to 46,000 in 1963; peak employment, from 111,000 to 90,000.
A total of 186,865 Mexican nationals were contracted during calendar year 1963 under the Agricultural Act of 1949 and the Migrant Labor Agreement of 1951 with Mexico. They worked in 17 States for 26,405 farm employers. California growers, contracting 59 percent of the Mexican workers, led all other States in their use.
Legislation governing the Mexican supplementary labor program under Public Law 78 was extended through December 31, 1964. The Migrant Labor Agreement with Mexico, covering operations under Public Law 78, was amended to provide for guaranty by the U.S. Government, in calendar year 1964, of an employer’s payment for social security to the Mexican Institute of Social Security.
British West Indians and Bahamians were another source of workers for seasonal jobs in U.S. agriculture. Their monthly average employment, at 8,700, was down about 400 from the previous year. Their peak employment rose from 13,800 in 1962 to 14,900 in 1963. Florida growers contracted most of these workers.
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Peak employment of Canadian workers in the U.S., principally for Maine’s potato crop, dropped slightly, from 8,700 to 8,400. About 1,200 Japanese, 100 Filipinos, and 1,100 Basque sheepherders also found seasonal employment in U.S. agriculture.
Aliens for Permanent Farmwork
To carry out provisions of section 212(a)(14) of the Immigration and Nationality Act, the Department of Labor was made the consulting agency to the Department of State in determining if aliens should be admitted for permanent farm employment in the U.S.
Under the new procedure, which went into effect July 1, 1963, the Department of Labor was consulted when one or more aliens made application for entry. During calendar year 1963, it certified against entry of 3,791 individuals for work in U.S. agriculture, after determining that the job offer was not bona fide; that the work was not permanent in nature; that the entry of the alien would adversely affect domestic workers similarly employed; or that there were qualified domestic workers available to fill the job offered.
Compliance Activities
Farm labor service representatives of the Bureau made 50,362 field inspections during calendar year 1963 to insure compliance with the Migrant Labor Agreement and the work contract of the Mexican supplementary labor program, and to investigate complaints and other matters related to the program. Inspections were made of housing, food service, transportation, and payroll and general recordkeeping. Investigations revealed over 5,000 deficiencies.
Wage Activities
Farmworkers referred in response to interstate clearance orders must be paid rates no less than those prevailing in areas of employment. Foreign agricultural workers must receive the rate set forth in their contracts or the rate determined to prevail among U.S. workers similarly employed in the area—whichever is higher. To insure these aims, there were 1,197 determinations and findings of prevailing wages being paid in 1963. These were based on 2,071 individual surveys conducted by the State employment security agencies.
Increased emphasis was placed on insuring that employment of foreign agricultural workers would not affect adversely U.S. workers similarly employed. Investigations were made of possible adverse effect in areas of foreign worker employment. Wherever possible, voluntary employer adjustments in wages and working conditions were achieved. In several instances, the Secretary of Labor issued determinations specifying rates below which the employment of foreign labor would adversely affect the wages and working conditions of U.S. farmworkers.
59
UNEMPLOYMENT INSURANCE
About 48 million workers in commerce, industry, and government, including the Armed Forces, were covered under the unemployment insurance program in fiscal 1964. In addition, 785,000 railroad workers were insured against unemployment under a separate system.
Nearly 2.4 million employers subject to State unemployment insurance taxes paid about $3 billion in fiscal year 1964. This amount included taxes paid by employees as well as employers in Alabama, Alaska, and New Jersey.
About $2.8 billion in benefits was paid to 6.1 million insured workers for 80 million weeks of unemployment during fiscal year 1964. Of this total, $2,642 billion was paid from State funds to workers insured under State laws and about $153 million from Federal appropriations to former Federal civilian and military personnel. Beneficiaries under State programs received an average weekly payment of $35.59; average duration was 13.2 weeks for all beneficiaries and 21.7 weeks for those who exhausted their entitlement. The improved economic situation resulted in a reduction from the previous year in insured unemployment and in benefits paid, despite an increase in the number of covered workers and in employers subject to the State unemployment insurance laws. The only exception to this trend was an increase in number of Federal civilian beneficiaries and the benefits paid to them. The closing of a number of obsolete military bases accounted for some of the increase. State reserve funds for payment of benefits increased for the third successive year to the highest point since the end of fiscal year 1958.
The Virgin Islands began payment of benefits in January 1964 in accordance with provisions of the Virgin Islands unemployment insurance law, the initial phases of which became effective in 1961.
No action was taken by the Congress toward enactment of legislation, proposed by the Administration, to broaden coverage, increase the taxable wage base, liberalize benefit and training provisions, and provide for treating long-term unemployment as a national problem.
Financing Benefits
The favorable economic condition which had existed since the end of the 1960-61 recession was reflected by an over-the-year upward movement cf State reserve funds—the third successive yearly rise—by 8.9 percent to $6.8 billion. This amount was 5.0 percent of taxable wages and 2.9 percent of total wages for the fiscal year, compared with 4.8 percent and 2.9 percent, respectively, a year ago. Contributing to the rise were increased tax collections, resulting from higher aggregate taxable wages rather than from changes in tax rates, and the downtrend in benefit payments. (The national average tax rate was 2.3 percent of taxable wages in calendar years 1963 and 1964, compared with 2.4 percent in 1962. It was 1.3 percent of total wages in 1964, compared with 1.4 percent in 1962 and 1963.)
The nearly $550.9 million increase in reserve funds for fiscal year 1964 resulted mainly from tax collections of $3 billion and $207.8 million in
60
interest earned on invested funds less $2.6 billion paid in benefits to the insured unemployed.
A question of continuing concern was whether unemployment insurance reserve funds were adequate to meet benefit payments in a recession period. Financing of the unemployment insurance program on a reserve-fund basis is a method by which that portion of benefit costs which exceed current tax income during periods of business recession is financed from reserve funds that are accumulated during more favorable periods. Experience in recessions which generally cover a period of 18 months or more has shown that benefit costs generally amount to one and one-half to two times the highest cost of any 12-consecutive-month period. Total reserve funds of $6.8 billion on June 30, 1964, amounted to 2.9 percent of total wages, but they were equal to only 1.48 times the highest 12-month benefit cost (benefits as a percent of total wages) during the last decade. This compares with a multiple of 1.42 a year ago. On the basis of a minimum reserve level equal to 1^ times the highest 12-month benefit cost, the reserves of 23 States would have been inadequate to meet the cost of a full recession period paralleling any which occurred in the 1950 decade. Eight States had a multiple of less than 1. A multiple of at least 2 was indicated for 21 States; 8 States had a multiple of 3 or more; and 3 States had a multiple of 4 or more.
The Federal Unemployment Account is built up and maintained from excess Federal tax collections over administrative expenses and is available for loans to States with low reserve funds. The balance in the account is limited to the greater of $550 million or 0.4 percent of the aggregate of the calendar-year taxable wages of all States. At the end of fiscal year 1964, the balance was $85 million—nearly $63 million more than a year earlier. No new loans were made, but $20.8 million was repaid by the three States which had borrowed in previous years a total of $233,765,000. Of the amount still due the account ($205,368,219), Alaska owed $8,089,293; Michigan, $97,829,926; and Pennsylvania, $99,449,000. Under the automatic provision of the loan, repayment began for each State with the taxable year of the fourth January 1 after the date of initial advance. For Alaska, that year was 1961; for Michigan, 1962; and for Pennsylvania, 1963.
At the end of 1963, Congress passed legislation (Public Law 88-173) which froze the Federal tax increase for automatic restoration of loans at 0.15 percent for the 5 years 1963-67. After that, the Federal tax will increase 0.15 percent each year (0.30 percent on 1968 wages, 0.45 percent on 1969 wages, etc.). In addition, the tax rate for repayment provisions of the advances made to the States for recession benefit payments under the Temporary Unemployment Compensation Act of 1958 was frozen at 0.30 percent for 1964 and subsequent years until the funds are repaid. Under the new legislation, States may make installment restoration in lieu of increased employer taxes.
In 1961, Congress enacted a temporary increase of 0.4 percent in the Federal tax on 1962-63 wages, in order to finance benefits paid under the
749-199—6!
-5
61
Temporary Extended Unemployment Compensation Act of 1961 which expired June 30, 1962. This temporary tax was reduced for 1963 (collectible in 1964) to 0.25 percent. A total of $306 million was collected in fiscal year 1964, representing final collections under the program.
State Legislation
Financing Legislation
Two States, Arizona and Pennsylvania, increased their taxable wage base from $3,000 to $3,600. Arizona’s law becomes effective in the next fiscal year, on January 1, 1965- Hawaii changed, to a flexible taxable wage ceiling of 90 percent of average earnings in covered employment for the year (also effective January 1, 1965). As a result of legislation enacted in fiscal 1963, the taxable wage base increased on January 1, 1964, in Pennsylvania and Vermont from $3,000 to $3,600 and in Utah from $3,000 to $4,200. At the end of the fiscal year, 16 States were providing for a taxable wage base above the $3,000 ceiling specified in the Federal Unemployment Tax Act. Other substantive developments included changes in the tax structure of four States (Hawaii, Maryland, Ohio, Pennsylvania), a change in the experience-rating plan of Mississippi, and a reserve adequacy measure in Ohio related to potential liabilities.
Weekly Benefit Amount
To keep pace with rising wage levels, four States and Puerto Rico increased the maximum basic weekly benefit amount—Arizona, $35 to $43; Maryland, $38 to $46; Pennsylvania, $40 to $45; Virginia, $34 to $36; and Puerto Rico, $16 to $20. Increases of $1 or $2 in the maximum benefit became effective in 10 Other States that had previously adopted such provisions. For the first time in 4 years, no State adopted a provision for automatic adjustment of the maximum weekly benefit as average wages change.
Maximum basic weekly benefit amounts, as of June 30, 1964, ranged from $20 in Puerto Rico to $55 in California and Hawaii. Twenty-six States, with 59.3 percent of the covered workers, had a maximum of $40 or more; in eight States, with 30.3 percent of the covered workers, the maximum was $50 or more. The maximum was less than $35 in 10 States with 12.1 percent of the covered workers. (In States which include dependents’ allowances, the “basic” weekly benefit is the benefit for a claimant with no dependents, as defined by law.)
Maximum basic weekly benefit amount, through June 30,1964
Number of States
Percent of covered workers (calendar year 1963)
Percent
Cumulative percent
$50 and over ($50-$55)_____________________________________
$45-$49______________________________________________________
$40-$44______________________________________________________
$35-$39_______________________________________________________
$30-$34______________________________________________________
Under $30____________________________________________________
8
9
9
16
9
1
30.3
16.0
13.0
28.6
11.5 .6
30.3
46.3
59.3
87.9
99.4
100.0
Total.
52 100.0
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Under the benefit formulas of most States, workers were compensated at about one-half of their weekly wages if their benefit amount was below the maximum dollar amount specified in the State law. Maximums failed to keep pace with increases in wages. Therefore, for many workers, as their weekly wages rose, the State ceiling on benefits resulted in a progressively lower ratio between their weekly wage and the benefit they received when unemployed. At the end of fiscal 1964, the maximum benefit represented 50 percent or more of average weekly wages in only 12 States with 7.9 percent of the covered workers. In calendar year 1963, over half of the claimants in 21 States were receiving the maximum benefit; in 14 of these States, 60 percent or more received the maximum benefit. Thus, many of these workers must have been earning more than double that amount when they were working.
Maximum basic weekly benefit amount, through June 30,1964, as a percent of average weekly wages in calendar year 1963
Number of States
Percent of covered workers (calendar year 1963)
Percent Cumulative percent
61-----------------------------------------------------------
50-54________________________________________________________
45-49________________________________________________________
40-44________________________________________________________
35-39________________________________________________________
30-34________________________________________________________
Under 30_____________________________________________________
1
11
8
16
10
4
2
0.4
7.5
30.0
31.1
16.3
10.3
4.4
0.4
7.9
37.9
69.0
85.3
95.6
100.0
Total.
100.0
Duration Provisions
Virginia increased its maximum duration from 24 to 26 weeks; however, only claimants qualifying for the maximum weekly benefit amount became eligible for 26 weeks. Pennsylvania changed from a uniform duration of 30 weeks to a variable duration of 30 weeks or 50 percent of the claimant’s earnings during his base period, whichever is less. It also provided a program of extended benefit payments up to 50 percent of a claimant’s maximum award. That program will be triggered when exhaustees in the preceding weeks exceed 1% percent of the average number of employees in covered employment during the 12 most recent months for which such data are available.
Maximum duration, as shown in the following table, ranged at the end of the fiscal year from 12 weeks in Puerto Rico to 39 weeks in Oklahoma. Forty-nine States, with 98.1 percent of the covered workers, had a maximum potential duration of 26 weeks or more. Uniform duration was provided in nine States, with 18.9 percent of the covered workers. In the other States, which varied duration of benefits with a worker’s base-period wages, maximum duration ranged from 22 weeks to 39 weeks.
63
Maximum duration in weeks
Number of States
Percent of covered workers (calendar year 1963)
Percent
Cumulative percent
Uniform duration:
26____________
12____________
Variable duration:
39_____________
36_____________
34____________
30_____________
28_____________
26_____________
24____________
22_____________
Total________
1
1
2
4
1
32
18.3 .6
.9
.5
2.9
12.4
1.3
61.8 .2
1.1
18.3
18.9
.9
1.4
4.3
16.7
18.0
79.8
80.0
81.1
100.0 _______________
8
Conformity Hearings
A hearing was held involving the conformity of the New Hampshire unemployment insurance law, and its administration, to the requirements in the Federal Unemployment Tax Act and the Social Security Act. Under this law, the New Hampshire agency, in cases in which a claimant was represented successfully by his attorney in court, sent on request the claimant’s benefit checks to his attorney. To be in conformity with Federal laws, a State law must provide for methods of administration which are reasonably calculated to insure full payment of benefits when due; it also must provide that money withdrawn from the unemployment fund be spent solely for the' payment of benefits to qualified individuals. After negotiations failed to resolve the issue, a hearing was held on May 12 and 13, 1964. Because of the varying practices in the States relating to delivery of checks to persons other than claimants, the Secretary, on July 29, 1964, dismissed the proceedings and directed the Bureau to make a thorough study of such State practices and to submit to him a proposed standard which would be applicable to all States.
Training Allowances
Approximately 54,700 MDTA trainees received allowances totaling $29,-552,277 under the Manpower Development and Training Act during fiscal year 1964. For this same period, $2,362,515 in retraining subsistence allowances was paid to some 11,400 trainees under the Area Redevelopment Act.
Public Law 88-214, approved by the President on December 19, 1963, contained the following amendments to the Manpower Development and Training Act: (1) To reduce the employment experience requirement for entitlement to training allowances from 3 years to 2 years; (2) to extend entitlement to training allowances to one member of a household (other than youths receiving youth training allowances) when the head of the household is unemployed; (3) to provide for augmentation in the weekly training allowance up to $10 over the regular training allowance payable in a State; (4) to permit the first 20 hours of part-time work of a trainee
64
undergoing institutional training to be disregarded in computing the amount of training allowance payable to him; (5) to permit the payment of a training allowance to youths 17 to 22 years of age (previously 19 to 22) under certain conditions; (6) to change the former ceiling of 5 percent of the total funds for youth training allowances to 25 percent of the total trainees receiving allowances; and (7) to permit an additional 20 weeks of allowances in basic education training.
In addition, the amended act provided for establishing a limited number of labor mobility demonstration projects. These pilot projects were designed to increase the mobility of unemployed workers and to provide information for assessing the effectiveness of such assistance in reducing unemployment. New section 208 of the act authorized the Secretary of Labor to provide relocation assistance in the form of grants or loans to involuntarily unemployed workers who could not reasonably be expected to obtain full-time work in the communities in which they lived and who had bona fide offers of permanent nonseasonal work elsewhere which they were qualified to perform. Assistance provided in the form of a grant could not exceed 50 percent of the transportation expenses of the worker being relocated and his family and their household effects. A person approved for a loan (or combination of loan and grant) could receive the total amount of such expenses. Not more than 2 percent of the funds appropriated to carry out the title, or $4 million, whichever is less, could be used for the purposes of section 208.
The amended act further provided for extension to June 30, 1965, of 100 percent Federal financing of MDTA training costs. It reduced from one-half to one-third the costs to be borne by a State beginning July 1,1965, but after June 30, 1966, a State must bear one-half of the training costs.
To implement the new MDTA amendments, the Bureau’s Unemployment Insurance Service prepared specifications for amended regulations, issued preliminary instructions to State employment security agencies for the payment of allowances under the amended act, developed operating procedures in handbook form, and revised outlines for evaluation of State agency operations.
Activity of the Unemployment Insurance Service with respect to trade readjustment allowances under the Trade Expansion Act of 1962 was limited to advising State agencies of the status ot worker, firm, and industry petitions filed with the U.S. Tariff Commission. Up to June 30, 1964, 15 petitions for finding of adverse effect due to increased imports had been filed with the Commission since the enactment of the Trade Expansion Act of 1962. Twelve petitions had been denied; one firm petition and two industry petitions were still pending.
Research and Information
UI Program Research
The continuous history of a sample of workers in and out of claimant status was recognized as a valuable source of information about employment
65
and unemployment patterns as well as a basis for such additional research as benefit entitlement studies, claimant characteristics, and depth studies of special groups of workers. Such data are available from records maintained by most States from employer reports. By June 30, five States had established continuous wage and benefit history files, and others were planning to begin them in fiscal 1965.
Benefit entitlement studies were in progress in 12 States, compared with 9 States the previous year. These studies involve compiling for samples of covered workers a quarterly record of earnings in covered employment over a 3-year period. The data compiled are useful in evaluating qualifying requirements of State laws and in assessing the labor force attachment of covered workers.
Extension of coverage to workers in noncovered employment was the subject off 11 studies planned or underway in 8 States. Three of these studies are concerned with State and local government workers, three with employees of nonprofit organizations, and three with business concerns employing one or more workers. The remaining two studies are on the feasibility of covering farmworkers, with one study nearing completion and the other at the beginning stage.
Seven State agencies had studies in progress during the year on the labor force experience of workers after exhaustion of their unemployment insurance benefit rights. These States were using the Bureau’s postexhaustion study guide to analyze the extent to which their laws provided protection to the longer term unemployed. Eight other related studies were planned or were underway. Three States completed studies in the area of disqualification and nonmonetary determinations research; 17 other studies were underway. Other research completed or in progress during fiscal year 1964 concerned adequacy of benefits, dependents’ allowances, benefit formulas, claimant characteristics, and successive-benefit-year claimants.
Work continued on findings from the studies of beneficiaries under the Temporary Extended Unemployment Compensation (TEUC) Act of 1961. Publication of national and State data on TEUC exhaustees in December 1963 brought to an end the series of seven general reports entitled “Family Characteristics of the Long-Term Unemployed.” The exhaustee report was based on samples of individuals interviewed in 1 of 4 survey weeks spaced at 16-week intervals during the TEUC program. It consisted of tabulations and an analysis of information about claimants who exhausted TEUC benefits during the life of the program 6April 1961-June 1962).
Through the cooperation of the Bureau and six State agencies, progress was made in the following tabulations and analyses of TEUC data: Educational characteristics of TEUC claimants in all States; financial resources and household adjustments of TEUC and regular program claimants in 13 States; work history of claimants after using up their TEUC benefits (.13 States); family characteristics and work experience of a control group of
66
regular program claimants (13 States); and family characteristics and work experience of beneficiaries filing interstate TEUC claims (4 States).
In addition to TEUC reports based on national data, 13 State employment security agencies published one or more reports based on results of the surveys of their long-term unemployed. Some of these States had other plans to continue analyzing the data and to publish, other reports.
To provide a basic source of information on the long-term unemployed for study by both public and private research organizations, the Bureau requested from all State employment security agencies the punchcards which reflected detailed interview data for each claimant surveyed during the four TEUC family characteristics study surveys conducted in 1961-62. The Upjohn Institute for Employment Research undertook to explore the basis for a large-scale project to tabulate in depth the information contained in the cards.
Benefit Financing
To help in planning for sound financing, State agencies increased their research into various financial aspects of the unemployment insurance program. Five of the most popular research areas were: (1) Forecasts of benefit cost levels over a period of years; (2) eflect of taxable wage base limitation on amount of taxes collected from different industries and different types of employers; (3) impact on tax income of benefit costs that do not enter the rating process, e.g., benefit payments not charged to any employer; (4) experience-rating techniques and operations; and (5) measures and indicators of reserve fund adequacy that include “ trigger” points for signaling the suspension of reduced rates or making effective alternative tax schedules.
Administration
Benefit Payment Controls
The Bureau continued to work with the States in development of effective benefit payment controls to prevent both fraudulent and nonfraudulent overpayments. Studies were devised for obtaining operating statistics on causes of nonfraudulent overpayments; methods were improved for discovering fictitious employer accounts; and controls were strengthened to insure proper payment of dependents’ allowance claims.
Data Processing
Fourteen State agencies installed or expanded their electronic data processing systems during the fiscal year; nine had plans underway for doing so in fiscal 1965. The full significance of the need to mechanize procedures can be grasped in relation to the tremendous amount of paperwork involved each year in State central and local offices. In fiscal year 1964, 98 million claims were taken and 8 million monetary determinations were processed; in fiscal year 1963 (the latest for which data are available),
67
384,000 appeals, 6 million nonmonetary determinations, 10 million tax returns, and 132 million wage record items were processed.
SPECIAL ACTIVITIES
In the area of administration and management, the Bureau provided technical and training assistance to State agencies to increase the effectiveness of their staffs and of management and operations; to attract and retain young supervisors with a potential for executive positions; and to correct deficiencies discovered through evaluation studies. Of top priority was the need to increase the competence of State employment service counselors. Specialized counselor classes were established in many States, qualification requirements and salary levels were raised, and extra effort was directed to recruiting better qualified candidates.
The growing complexity of the employment security program and the need to identify responsibilities for ES and UI functions in most metropolitan areas prompted organizational separation of unemployment insurance and employment service functions, whether or not the operational staffs were separated physically. In major metropolitan areas where separation was in effect, further refinements were made. In addition, assistance was given to State agencies in the reorganization of 10 local offices serving areas having a population under 500,000.
A study was undertaken of the potential for mechanizing clerical, reporting, and accounting activities in the employment security system. Represented on a task force, charged with developing a master plan for converting manual operations to machine methods, were a staff member of each service in the Bureau and a State agency representative. That group visited selected local and State offices and regional offices of the Bureau to study mechanized operations and to obtain suggestions on application of machine processes. April 15, 1965, was set as the date for the task force to make its report of findings to the Bureau administrator and to submit short- and long-range recommendations for the conversion of operations and the acquisition of equipment.
Progress was made in mechanizing budget and fiscal operations in the Bureau’s national office. Forms used in the budget process were machine-produced, not typewritten, and budget information was machine recorded and stored for later retrieval. Being developed wTere an accounting system to utilize machine methods and a financial management information program to provide administrative officials throughout the employment security system with current fiscal data useful in decision making.
In January 1964, the Bureau began publishing two new monthly periodicals—“Employment Service Review” and “Unemployment Insurance Review”—and discontinued, with their December issue, three periodicals— “The Labor Market and Employment Security,” the “Employment Security Review,” and “The Insured Unemployed.” Each new publication was designed to inform those in the program and interested outsiders of
68
all aspects of the program and its operations. Detailed statistics on employment service operations and the work force were published separately in a monthly "Statistical Supplement,” and those on unemployment insurance in a separate monthly report, "Unemployment Insurance Statistics.”
Appendix table 1.—Selected employment service activities, U.S. totals for fiscal years 1956-64, by State for fiscal year 1964
Year and State New applications 1 Total counseling interviews Individuals tested Placements
Nonagri-cultural Agricultural
1955-56 8,083,024 1,444,669 1,314,134 6,173,684 9,248,459
1956-57 8', 546; 028 i; 507,825 1,448,607 5; 957,490 9,002,052
1957-58 10,412,879 i; 542; 846 i; 349; 924 5,235,910 8,709', 763
1958-59 9,368;746 i; 734', 170 1,609,536 5; 703,458 9,615,163
1959-60 9; 598; 604 1,785,541 1,760,754 6,082,753 9,747,116
1960-61 10; 605,108 i; 783,310 1,799,730 5,591,089 9; 004; 319
1961-62 10; 413,532 2', 020; 549 2; 176; 709 6; 506; 008 9; 028', 451
1962-63 Hi 045; 696 2,088,332 2,300,436 6,632,252 7,923,543
1963-64 10; 924; 071 2', 008,356 2,337,758 6,453,858 7,124,933
Alabama - 143,762 18,662 39,262 120,060 71,297
Alaska 19; 650 3,529 7,545 11,900 '315
Arizona 130; 421 18', 194 22,500 109; 219 814,996
Arkansas - 153,936 27,472 35; 292 114,309 169,340
California 1,529,658 189,667 226,408 756,952 274,408
Colorado - .. ' 129; 924 20; 612 30,447 91,310 62,642
Connecticut- 188,644 31,157 29,358 88,960 10,112
Delaware 19, 358 4; 100 8; 176 6,628 4,118
District of Columbia - 68; 823 23,453 20, 882 44,600
Florida 234;614 30; 196 54', 680 258;410 174,829
Georgia __ — 195; 696 3i; 962 41,437 162; 354 60,407
Guam i; 735 1 32 697
Hawaii - 41', 811 5,380 6,990 13,658 1,991
Idaho _ - 52; 884 9', 738 11,786 37,673 121,426
Illinois 404,348 88,130 113,068 199,825 55,058
Indiana .. 266; 243 37; 055 58; 197 lli; 234 41,353
Iowa 102; 424 20; 058 35,025 86,382 32,765
Kansas 100, 544 22; 839 27,184 80,925 18,854
Kentucky - - 155; 889 37', 918 53,393 62,175 92,083
Louisiana - 130,761 20,113 28,724 89,243 111,858
Maine 49; 669 14; 371 14,583 24; 237 8,533
Maryland - 164,887 26,807 25; 783 89,601 100,568
Massachusetts 334,731 65; 249 54,356 163,966 44,408
Michigan 579,858 62,649 90; 091 183,736 91,021
Minnesota 187,085 22,979 54,328 92,006 31,945
Mississippi 139,382 38, 359 42,327 106,978 1,323,762
Missouri 230; 089 43, 700 62,200 103,027 166,086
Montana 49; 967 17,806 16,697 32,415 34,322
Nebraska 56,709 17,863 25; 895 55,048 24,884
Nevada - - 45; 889 5,229 7', 655 31,511 5,524
New Hampshire - 42', 044 7,729 8,520 16,290 4,102
New Jersey ._ - 339', 113 43; 782 39,127 143,561 126,572
New Mexico 60', 174 12,489 17,204 42,280 16,769
New York 920,233 23i; 390 143', 749 834,508 125,264
North Carolina 258,422 43; 291 65,816 144,321 567,471
North Dakota— 39; 270 5; 619 12,666 28,998 15,833
Ohio 546,392 80; 116 105,638 216,456 178,277
Oklahoma 138', 585 34; 759 35; 266 169,149 94,126
Oregon 140; 262 34; 851 29,454 72,972 276,264
Pennsylvania 566; 958 173; 523 113,107 259,006 296,622
Puerto Rico 188,477 29', 661 23,262 47,722 11,042
Rhode Island - - - 52; 060 12,758 Hi 730 30,186 132
South Carolina 110,538 14,509 35,522 77,971 124,600
South Dakota 30; 421 L 440 io; 413 23,941 11,436
Tennessee - 154;072 25; 329 66,749 116,667 628,399
Texas - 699; 121 126; 055 151,902 505,807 389,021
Utah 53; 716 15; 632 29,184 40,824 24,718
Vermont 22;667 2,627 4,082 14,075 1,412
Virginia 148; 901 4i; 057 46,638 109,426 50,166
Virgin Islands. - 2; 658 '887 581 1,402 5
Washington 202,982 38,784 51,629 84,655 188,335
West Virginia. 81,151 24; 193 18,249 39,715 7,593
Wisconsin 195,963 42,659 70,224 90,039 29,648
Wyoming 20; 500 3; 968 2,745 14,848 8,221
i The number of applications taken should not be interpreted as a measure of the total number of new job applicants at employment service offices since there are some types of applicants for whom written applications are not taken.
69
Appendix table 2.—Significant provisions in State unemployment insurance laws, June 30, 1964*
70
88888888 gggggSgg i — £ a
88888888 1
88888888 goggggg
88888888 1
?
i 3 - : H 8 1 i Jg 8
88888888
71
Appendix table 3.—Claims, beneficiaries, amount and duration of benefits under State programs, U.S. totals for fiscal years 1955-64, by State for fiscal year 1964
[Note: Data for fiscal years 1955-59 Include activities under the program of unemployment compensation for Federal employees and represent an unduplicated count for both
Claimants exhausting benefits 1 Percent oi an beneficiaries * a^OOOHOO-tf Xr <8 Actual 33333SS233 ONOJ^OCOCS D ^3* 3S22dSS S22^
Average § ua Potential •
IL 1 Percent of average weekly (total) wages Ct0C»NOaeOCWa 33^55^3
Amount
wage in covered employment ssssssssss
< weekly benefici- 8 3 IfSWSgsl r-T rtVrtrtCirtr