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SALARIES OF FEDERAL EMPLOYEES

WEDNESDAY, MAY 22, 1957

UNITED STATES SENATE,
COMMITTEE ON Post OFFICE AND CIVIL SERVICE,
SUBCOMMITTEE ON FEDERAL EMPLOYEES COMPENSATION,

Washington, D.C.. The subcommittee met, pursuant to adjournment, at 10:05 a. m., the Honorable Richard L. Neuberger, presiding.

Present: Senators Johnston, Neuberger, Yarborough and Morton.

Also present: J. Don Kerlin, staff member, and Frank Paschal, staff member.

Senator NEUBERGER. The subcommittee will please come to order.

Before we hear our first witness this morning I would like to make a very brief announcement.

For the information of all concerned the schedule of witnesses has been rearranged as follows: First, those who were scheduled to testify yesterday and who were unable to do so will be heard first today; immediately thereafter those originally scheduled to be heard today who are from out of the city will be heard. Second, those originally scheduled to be heard today will be heard Monday. Third, tomorrow's schedule will be followed as originally set up.

It is believed that this rearrangement would cause the least amount of inconvenience particularly with respect to out-of-town witnesses and I am anxious particularly to be fair to them because they have come at some expense and bother from their home communities.

I just want to state this for the record.

The chairman of the subcommittee will be unable to be present tomorrow because the chairman of the Senate Public Works Committee has called an executive session to take final action one way or another on legislation proposed to control signboards along our Interstate Highway System and inasmuch as the chairman of the subcommittee has been active in that he will have to be present at that meeting and I desire the record to show the reason for my absence.

I will make every effort to request Senator Yarborough to be present and to preside and if he is unable to do so because of the conflicting committee schedule or because of again having to go to his home State which has been stricken by natural disasters as we know, I will request Senator Morton, if that is convenient with him, to preside. If he is unable to do so, why, we will try to go on from there.

Senator MORTON. I will be happy to do so, sir.

Senator NEUBERGER. Thank you so much, Senator Morton. So, we will have a session tomorrow and I understand there are sufficient witnesses then to have a further session on Monday at 10 a. m. I want to thank Senator Morton for his courtesy in that respect. The first witness today will be Mr. James A. Campbell, president of the American Federation of Government Employees.

Mr. Campbell, we will be pleased to hear from you. STATEMENT OF JAMES A. CAMPBELL, PRESIDENT, AMERICAN

FEDERATION OF GOVERNMENT EMPLOYEES, ACCOMPANIED BY MRS. ESTHER F. JOHNSON, NATIONAL SECRETARY-TREASURER OF THE AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES; W. J. VOSS, RESEARCH DIRECTOR, AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES; AND FRANK B. SHERRY, PATENT EXAMINING SPECIALIST, UNITED STATES PATENT OFFICE Mr. CAMPBELL. Mr. Chairman, for the record my name is James A. Campbell. I am president of the American Federation of Government Employees, an organization made up principally of classified Federal employees but with some considerable membership of wage board employees. We have members in most of the departments of the Government and all over the United States and in its possessions and in some foreign countries.

I have with me this morning Mrs. Esther F. Johnson, the national secretary-treasurer of our organization; Mr. W. J. Voss, the director of our research department, and Mr. Frank Sherry, who is a former national vice president and is a patent examining specialist in the Patent Office at the present time.

Mr. Chairman, we have a debt of gratitude to Chairman Johnston and to the other members of the committee who have submitted the various pay bills that are under consideration at this time. All of these bills are pointed, of course, in the direction as that of a pay raise. They have some variations and some of them apply or are limited to certain groups. We are inclined to favor S. 910 because of the fact that it applies to all employees and that it confines itself to a pay raise.

We believe that the other bills, S. 27 and S. 1326 and S. 734 are equally entitled to the consideration of the committee and I believe that after the testimony is in that we can leave to the judgment and the sympathetic understanding of the committee the final answer as to what our pay situation will be.

Senator NEUBERGER. Mr. Campbell, I want to say one thing before you commence your testimony, and I would like to say this for the “* benefit of all the witnesses.

I notice that much of the advanced testimony which has been submitted to us is very extensive statistically, and so on, and we do have a great number of witnesses and I want to say this for the benefit of everybody: if any witness desires to paraphrase and highlight his testimony, despite that fact, if it is agreeable with Senator Morton, the full text of the testimony will appear as presented to the committee in the official hearing transcript.

Mr. CAMPBELL. It was my intention to paraphrase the written testimony.

Senator NEUBERGER. But the full text will appear without objection in the record.

Mr. CAMPBELL. Mr. Chairman, an increase of salaries for employees in positions subject to the Classification Act can be substan

tiated for reasons of governmental propriety, public economy, and personal justice.

The Cordiner Committee report to the Secretary of Defense submitted conclusive proof that a pay raise represents a most desirable form of governmental economy. The committee pointed to the loss the Government is sustaining in the withdrawal from the Federal service of so many able employees who have demonstrated their worth by saving the Department of Defense many millions of dollars. The report also ably portrayed the need for offering more attractive compensation to retain the services of these qualified persons who have been leeaving the civil service for more remunerative. employment.

The loss however is not confined to those having highly specialized skills, who are leaving positions in the upper grades. It applies to a considerable extent to those in the lower salary ranges. It is costly for the Government to be deprived of the experience and onthe-job training of so many employees who go to private employment because the civil service has lost its attractiveness.

We heartily concur with the forthright position of the Cordiner Committee that Government salaries should be increased. It is our conviction that there are several cogent reasons for a pay raise at this time. In fact, it is the considered view of the American Federation of Government Employees that Federal workers never had a stronger case on which to base their request for an upward adjustment of their

pay.

It has been indicated that this hearing is to deal specifically with two bills introduced by the chairman of the Senate Committee on Post Office and Civil Service. The one bill, S. 734, is designed to revise the basic compensation schedules of the Classification Act of 1949, as amended. This bill deals extensively with revision of the Classification Act.

We are in agreement that the Classification Act is in need of various changes which will afford appreciable improvement in its application to the positions subject to its provisions. But the changes contemplated in S. 734 represent but a small part of the revision of the law which appears necessary. The distribution of the important and vitally needed modifications of the existing Classification Act is a complex task and in our opinion would best receive the attention it deserves if a searching study could be made by the Post Office and Civil Service Committee when the subject will not be needlessly complicated by the added objective of providing a pay raise.

The bill that would provide an immediate pay raise and not involve the complex problems of revision of basic features of the classification law is S. 910 sponsored by Senator Langer, a member of this committee.

That bill will raise the current ceiling on classified salaries so as to relieve the compression of grades and would result in a more realistic and satisfactory relationship between grade levels.

Briefly what I mean is that our primary interest is a pay raise without delay for Federal workers, both classified and postal. We include of course in the classified group employees of the District of Columbia.

Federal employees are desperately in need of added buying power which they have never fully regained since the start of World War

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II. Each raise they have received, beginning with the Federal Employees Pay Act of 1945, only partially restored the ground lost since the preceding one. Each time their economic position was less favorable than it was before the revised pay rates became effective.

In March of this year the 1939 dollar had been reduced in real value to 49.6 cents. It was worth 52 cents at the time of the last pay increase exactly 2 years earlier. For many employees outside the Government service the 1939 dollar has returned to its former value represented 18 years ago. and in fact has been given a buying power beyond the 100 cents it

To demonstrate the undeniable right of Federal employees to an increase of salary, this statement will offer proof in the form of official or otherwise reliable data premising such arguments as the following:

1. Continuously rising prices from the beginning of World War II have robbed Federal employees of purchasing power, as measured by the Consumer Price Index. This long-term loss must be taken into account or the result is a permanent loss.

2. Salaries in the first four general-schedule grades are entitled to raises on these grounds:

(a) Federal employee participation in overall national productivity; and

(6) Increases in office-worker salaries outside the Federal service-increases which are becoming larger and more significant because of the growing trend of unionization and more successful collective bargaining in the white-collar field.

3. A more rapid rate of wage increases for the Government's own blue-collar workers.

4. Additional evidence that blue-collar workers in Government and in private industry have improved their economic position at a faster rate than their coworkers in office jobs, which points up the need for matching this advancement with pay rates sufficient to reward the skill of and the responsibility assumed by clerical and professional employees.

5. The increasing gap between gross earnings and spendable earnings, that is, between total salary and the take-home portion available for everyday spending.

6. Changes in the New York Federal Reserve Bank Index of Average Weekly Earnings of Clerical and Professional Employees.

The full impact of rising prices on the salaries of Federal employees may be measured significantly only on a long-term basis. It is true that the Consumer Price Index has risen 4 percent from March 1955, when the last salary increase became effective, to March 1957. It is also true that the price advance since July 1951, when the preceding increase was effective has been 7.2 percent.

These figures do not reflect the real underlying situation which prevails in the Federal civil service, nor do they accurately disclose the extent to which Federal workers, both classified and postal, have been the victims of a rising price level since the start of World War II. It is a cumulative condition which is causing the Government to lose capable employees who are not always being replaced with employees who are equally able.

Classified employees began losing purchasing power with the first rapid rise of prices in the immediate postwar period. The constant

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