View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

FEDERAL RESERVE BANK
OF NEWYORK

March 26, 1957.
Dear Chairman Eccles:
Realizing your interest in the revival of the building industry - probably the best future outlet for unemployment it occurred to me that you might want to read the enclosed
memoranda which came across my desk the other day in another
connection.
The yellow memorandum was written as a part of the
usual follow-up work on one of our industrial loans.

Both memo-

randa were prepared as a part of the regular routine of our
Credit Department.
purpose.

They had not been requested for any particular

It is only because of the data which they contain re-

garding the trend of wages in the building industry that I am
sending them to you.

It seems to me that if the trend of wages

of labor in the building industry indicated in these memoranda
should continue, it would, likely result in seriously retarding
the recovery in building.
We do not ordinarily circulate material of the kind
gathered by our Credit Department in the enclosed documents, and
I hope, therefore, that the Board will, for obvious reasons, consider it confidential.

Hon. Marriner S. Eccles,
Chairman, Board of Governors

of the Federal Reserve System,
http://fraser.stlouisfed.org/
Federal Reserve Bank Washington, D. C.
of St. Louis

fullwyo4ars,
tf(
Georje L. 'Harrison,
President.

COPY

CONFIDENTIAL

MISC. 3.2 60M 8-36

^LJLi_i±2±Ll±ifi±!

FEDERAL RESERVE BANK
OF NEW YORK

OFFICE CORRESPONDENCE
To
FROM

Mr. J. H. Hartley

HATF

.

March 20, 1957.

SUBJECT:.

C. R. Bowman

The work of erecting partitions, furring, beading and lathing
on the job is progressing smoothly. Figuring through March 17th, all
of the needed materials had been delivered and 77$ of the estimated labor
performed. At the rate they have been operating, all of this work should
be finished within two weeks. The actual cost of materials evidently is
going to run very close to estimates, possibly a little lower.
This part of the job represents, however, only about one-third
of the cost of the entire sub-contract. The remaining two-thirds represents
the plastering operation, with the ratio of labor cost to materials estimated
at about 50 to 18.
The plasterers were on the job only a few days when on March 4th
the International Office of the Plasterers Union called a strike, which was
directed against the P.W.A. because the specifications of several housing
projects in a number of cities called for ceilings of smoothly finished
concrete, eliminating the usual plaster, thus reducing costs. The strike
is still in effect. It is the contention of the union officials that the
procedure defeats one of the principal aims of the P.W.A., i.e., providing
employment. As my informant is not a direct principal in the strike, he
is not in on every move being made, and a good deal of his information is
second-hand. He told me yesterday that the P.W.A. men came up from
Washington last week, and before returning conceded that the extra plastering should have been included in the specifications, but they claimed they
could not see what could be done about it because there was no money appropriated to cover the extra cost, which would be about $100,000, and in this
case the work has already progressed so far and the houses are scheduled to
be finished in June or July, that they do not want to delay the opening to
a later date, which would have to be done if an attempt were made now to
get the money and have the work done. The P.W.A. people say that the Union
delayed their protest too long. The Union officials feel that having obtained an admission from the P.W.A. that the ceilings should be plastered,
they intend to press for further consideration, and it is their intention
to try to obtain further consideration at Washington. My informant felt
that probably the P.W.A. authorities would try very hard to get the whole
matter settled before it is taken over their heads, and he was hopeful that
the strike would be settled next week. As the Union realizes that a prolonged strike may create prejudice against their contentions in Washington,
they may call off the strike under protest if a decision is not obtained
next ?reek, and have the plasterers go back to work while the Union officials
continue negotiations.

c

The Mason Builders Section of the Building Trades Employers1
Association of this city have been conferring for some time with the labor




MISC. 3 2 60M 8-36
.

FEDERAL RESERVE BANK
CF NEW YORK

OFFICE C O R R E S P O N D E N C E
ToFROM

Mr. J. H. Hartley

DATE
SUBJECT:.

liarch-2Q#_19SZa
#1181

C. R. Bowman

unions they come in contact with to negotiate a new working agreement,
involving shorter hours and higher pay. My informant is a member of the
Employers' Association Committee. He advised me recently that all important details have been agreed upon and that the formal contract will probably
be signed very shortly. This will call for pay increases as high as 25% on
hourly basis, to be effective June 1, Y t i e my informant was somewhat loath
fil
to give details before the contract is signed, I gathered that the plasterers
who are now getting $12.00 for an 8 hour day, or $1.50 an hour, are to get
$14.00 for a 6 hour day, or $2.55 1/3 an hour. The lathers, now getting $11.20
for an 8 hour day or $1.40 an hour will^continue to work the same number of
hours and will get $13 per day or $1.62~| an hour. The laborers, who are now
getting $8.00 for an 8 hour day will also be raised in proportion, but I
understand the details have not been completed, as there will have to be
taken into consideration the fact that the plasterer's laborers will work
6 hours a day and the lather's laborers 8 hours.

c

As the present job is estimated at the old scale labor rates, it
is necessary that the contract be completed before the new scale is effected
on June 1, in order to protect the estimated profit. My informant gave me
to understand that that can still be accomplished if the plasterers cease
striking within the next week or so, but that he probably will have to work
bigger crews than he had planned.
My informant also told me that while he was not conversant with
the arrangements of the other building trades labor unions, he believes that
during the year pay rises would be practically universal, and would result
in an increase in aggregate building labor costs of about 25$ over 1936.