I speak with deep feeling on this subject because I know at first hand what it means in the great war-production area which I in part represent.

I shall appreciate it if this letter may be entered in the records of your committee hearings.

I thank you again for your courtesy in notifying me in detail respecting your current continuation of hearings.

With warm personal regards and best wishes,

Cordially and faithfully,

A. G. VANDENBERG.

STATEMENT OF A. F. HINRICHS, ACTING COMMISSIONER, BUREAU OF LABOR STATISTICS

Senator MURRAY. Mr. Hinrichs, will you please give your full name and official position to the reporter?

Mr. HINRICHS. A. F. Hinrichs, Acting Commissioner of Labor Statistics, United States Department of Labor.

Senator MURRAY. You may proceed with your statement.

Mr. HINRICHS. I was asked to describe briefly, Senator, the work that the Bureau of Labor Statistics is doing in the post-war field.

For a period of 2 years, we have been working with an appropriation directly from our Appropriations Committee in Congress, to determine the character of the post-war labor problems that will arise out of the wartime dislocations.

Our primary work involves an analysis of employment trends and the dislocations of employment that have occurred, indicating in those studies the areas in which the dislocations have been greatest and the character of the industrial distribution of that employment.

In addition to those specific studies of employment trends, we are experience following the last war, involving research in the archives and with other materials of that period, to find what light the experience of the last war throws on the problems that we are going to face after this one.

In addition to those specific studies of employment trend, we are obviously concerned with the relationship of employment to other measures such as public works programs and measures of fiscal and economic policy that will affect employment in the post-war period. I think that it might be helpful to the committee if I were to indicate briefly by way of background what the effect of the war has been on employment and on the labor force.

The chart which I have here [indicating] shows the changes that have occurred in employment and in the labor force in the United States from March 1940 until March of this year.

CHANGES IN THE LABOR FORCE

MARCH 1940 TO MARCH 1944

(Chart I, referred to by witness, is as follows:)

20

5-10-44

Each one of those bars represents the situation in March of each year, 1940, 1941, 1942, 1943, and 1944.

The first thing to which attention should be directed is the change that has occurred in employment as such. In March of 1940, there were about 45,000,000 people employed in the United States.

By March of 1941 that number had risen to 46,000,000-not a very large increase. The sharpest increase in employment occurred in the year between March 1941 and March 1942.

In March 1942, we had over 50,000,000 people at work, an increase of 4,000,000 over the preceding year. A further increase of about 1,000,000 to March 1943, was followed, as between March of 1943 and the present time, by a small decline in employment.

The most marked increase, so far as employment is concerned, was in the manufacturing segment. Of the 45,000,000 people who had been employed back in March 1940, about 1012 million were engaged in manufacturing. At the present time the number is 151⁄2 million, a 5 million increase-nearly as large an increase in manufacturing alone as has taken place in total employment.

The other large expansion in employment has been quite largely in the civilian personnel of the Army and the Navy, engaged in arsenals, navy yards and the operation of depots, bases, and so forth.

There has been on that account an increase of nearly 2 million in the number of people employed by Government. The other activities of the Federal Government, other than strictly wartime activities, have shown no increase in employment, nor has there been an increase in State and local governments since 1940.

Senator MURRAY. Haven't they decreased some?

Mr. HINRICHS. Some decrease. The change there is comparatively small.

Those represent the extraordinary expansions of the wartime period. They have been accompanied, of course, by a tremendous expansion of the number of individuals in the armed forces.

Back in 1940 we had less than half a million in the armed forces of the United States. At the present time there are in the order of 102 million. So that you have had both an increase of employment of about 52 million and an increase of something more than 10 million in the armed forces, a total increase of fifteen million or sixteen million people.

That has been made possible by two developments. The first was a sharp decrease in the number of people who were unemployed.

At the beginning of the war we had some 8,000,000 people who were unemployed. That number was reduced to a figure of about 6 million in March 1941 and cut to a little more than 3 million in March of 1942. It has been running at levels of about 1 million since March of 1943.

Mr. GWYNNE. When you speak of the number of unemployed, do you deduct those people who are unemployable for all practicable purposes?

Mr. HINRICHS. No; when I talk of the number who are unemployed, I am talking of the number of people who are actively seeking work at any time in the labor market whether there is a hope of their finding work or not.

98534-44-pt. 2- -2

If I can digress for a moment to the concept of unemployable workers, I would like to say that experience has demonstrated that those who are truly unemployable comprise a comparatively small number. Normally, those people who are truly unemployable are not seeking work and hence are not counted in the labor force or as unemployed. A man who is ill or crippled in such a fashion that he cannot work, and is unemployable in that sense, is normally not seeking work.

The unemployables that we ordinarily refer to are a group of people-and I can only guess very roughly about their numberaggregating certainly a million and perhaps 2,000,000 individuals who find it difficult to secure a job and to hold a job for a long period of time. There is a constant churning of that so-called unemployable group into and out of jobs. Therefore, at any one time half a million or so of the group may be looking for work and counted among the unemployed.

They are not a significant factor in the total picture at the present time.

Mr. GWYNNE. What are the chief reasons for these people being unemployable?

Mr. HINRICHS. A variety of personal reasons, though the causes may be social. Bad work habits, completely inadequate training

Mr. GWYNNE. Poor health?

Mr. HINRICHS. Poor health, psychiatric cases-a large variety of factors.

A certain number of people are normally made unemployable by prolonged periods of unemployment. That is, unemployment is so demoralizing an experience that you add to your list of unemployables immediately by virtue of the fact that you have had severe unemployment.

Mr. GWYNNE. Do you think because of the stress and strain of war, that after the war is over the percentage of unemployables will be increased?

Mr. HINRICHS. I think it is so completely negligible a factor that it ought not to enter into considerations of public policy with respect. to the number of jobs we need to be able to fill. If you are referring to the problem of the rehabilitation of people who have been personally dislocated either by service in the armed forces or by industrial experience, it may be a problem. I think it is large enough to call for some remedial measures if that is the point of your question.

Mr. GWYNNE. Do you intend to make some comment on the situation so far as agricultural employment is concerned? There were fewer people employed there in 1944 than in 1940. Is that correct?

Mr. HINRICHS. There was some decrease in agricultural employment, a decrease that I believe was particularly marked at the end of 1942. I don't pose as an expert on agricultural employment, but there has been a slight decrease there.

The final point that I would like to note in connection with this chart is that we met this expansion in manufacturing and in the armed forces, first out of the decrease in the number of people who were unemployed, and second from a very substantial increase in the total number of people who are participating in the labor market.

In 1940 we had about 5312 million people in the labor force in the spring. In the spring of this year the number is about 624 million,

an increase of about 834 million people. Part of that increase represents merely the growth of the population of working age, about 234 million of it.

About 6 million represents people who are in the labor force today, or in the armed forces, who under normal conditions, would not have been in the labor force.

You have then about 6,000,000 workers who have been drawn into the labor market by virtue of wartime activity itself.

(Chart II, referred to by witness, appears on p. 48.)

Mr. GWYNNE. That includes women and older people who would not normally be employed?

Mr. HINRICHS. It does; yes. It includes about 34 million males; just under 3,000,000 females.

Looking at the story by age groups, about half of it represents participation in the labor force of young persons, who would normally be in school or college, under the impact both of selective service and of opportunity for wartime jobs.

(Chart III, referred to by witness, appears on p. 49.)

There has been on the whole a very small addition among males over 25 years of age. That is indicated by these bars showing in all about 1,000,000 extra men working in the age groups above 25. No more than half a million, and probably less than that are people who have been drawn back from retirement or have postponed retirement.

There has been an increase of about 114 million in the number of women 35 to 55 years of age. No significant additions occurred among women 25 to 35 years of age.

So that the picture of that 6 million of extra wartime workers may be described as consisting of about 3 million young persons out of school, about 12 million women over 25 years of age, and about a million or slightly more males over 25 years of age, of whom about half a million are older folks who, under normal circumstances, would be retired.

The expansion that I was talking about in manufacturing employment has, of course, characteristically been in the heavy goods industries, in the manufacture of airplanes, ships, the fabrication of the machinery and the fabrication of the basic materials underlying them.

(Charts IV and V, referred to by witness, appear on pp. 50-51.) In manufacturing, wage-earner employment in its entirety has risen since October of 1939 from about 8,800,000 to nearly 14,000,000 individuals, an increase of 5 million. This has almost all been in munitions. There has been very little change, contrasting the two terminal periods, in employment in nonmunitions manufacturing industries.

(Chart VI, referred to by witness, appears on p. 52.)

For the latter industries a decrease in the number of males has been offset by an increase in the number of females working.

In the munitions manufacturing industries you have had an increase from about 3,000,000 people, wage earners, in October of 1939, to 8 million in the fall of 1943. That represents essentially the wartime peak of munitions manufacturing employment.

About two-fifths of that increase in munitions manufacturing was made possible by the introduction of women into the labor force. The other three-fifths represented an increase in the number of males who are employed.