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October 30, 1942
Chairman Eccles

The Manpower Problem

Martin Iro&t

guggaarv. Ther© is no manpower problem; only the problem of hew to use imnpower
most effestively* That ia to say, there ia no manpower problem} only the probleio of
manpower policy*
The faota. About 59 million people are now at work &n& ia the armed forces*
Unemployment h&a virtually disappeared} about 1#? million people were counted a$ ranemployed in Septemberf because of various local, temporary causes — peopl© in transit
between jobs, local material shortages, sudden shifts in demand, etc. — this number
will n©T®r be much smaller. The labor force — the total of people at work and seeking
work #*» is already sonvwhat above noiiml, ia terns ©f the proportion of the labor
foree to the total population* The only numerically important group of people now
outside the labor foree who could be brought into it are married women. This is the
supply side of the picture.
On the demand side, about 4 million m&n smst be added to the armed forces *
about 4 million peopl© srast be added to the labor foree in war industries by the end
of 1943• Taking normal turnover into account, about 14 isillion persons, 84 per cent
of the present labor force, ssuat be put into new jobs; about 9 million of them, 18 per
cent of the labor force, must be trained to fill jobs new to them. These over-all
figures look seriousj the situation in local scarcity areas is very srach aor© serious*
Broad policy problems* The problem is so big that a number of different measures
are needed to produce a reasonably satisfactory solution. Organised labor dislikes
s©3ne of th© measures neededj employers dislike others* The political problem is how to
keep a reasonable balance between these two different points of view. Anyone who be*
lieves that, even in a crisis, it will be possible to force a one-sided solution is
in for aoaae nasty surprises.
(1) How large should the arxaed forces be? By the end of 1943 the &m& will
have 7#S million, th© lavy, Marine, Goast Guard, and Merchant Marine Z million. Th©
total, $.5 million BHKL« is about one»third of all men aged 18-40. Industrial and
agricultural manpower needs, shipping and land transportation shortagesf and Land-Lease
requirements sake it elearly unwise for the armed forces to exceed this figure.
(2) How jaany hours a week should people workt In September, the average hours
per week actually worked was 43. Allowing for sickness, lay-offs due to niaterial
shortages# and other causes of voluntary and unvoluntary absenteeism* average hour®
scheduled were about 45* 4.4 million peopl© worked 60 hotirs or longer, 4.5 million
60-59 hours, 24 million 40-49 hours, 6.6 million 30-39 hours, and 3*1 million leas than
30 hours. lot all of these peopl© would work 48 hours a week if overtime for hours in
©xoes® of 40 were eliminated* lot all of th&m would work 48 hours a week even if th©




t&d© a scheduled 48-h.our week compulsory* Borne of these people work©*!
short hours because 'they' were siekj others because they were on vacation* others because of jaaterial shortages and inefficient management$ others because they worked
in continuous process industries where teehnioal factors control the length of shifts}
some of the© •- but only some of them — worked short hours because their employers
could not or would not pay overtime rates for the longer hours* Because these
considerations all corn© in, it is hard to estimate how saany people would be released
by le&gthenin^ the straight-time work week to 48 hours• One rough estiisate would b©
about 2
(3) How can hours be lengthened without discouraging tin© use of other,
desirable* -methods of relieving the labor shortage? |»©ngth©ning hours is not the only
answer to labor shortages* Other, better answers ar© training; action to eliminate
over-staffing and labor hoarding by employersj drastic action to clean up the unwholesome situation in the fiold of raw rmtorial allocations» and measures to give the
United States Imp lament Service personnel competent to deal with the vast problgrass
now being thrust upon it.
Immediate policy iproblexas • (1) Problems arising out of wage stabilization* Wage
stabilisation solved no problems* It —rely gave a new fonti to the problemj How are
people to be put into the jobs where they are most needed? Before th© freese, wage
incentives could be used to RJOV© people from less es$«afci%l, to sore essential jobs.
Now the existing differences in wages are froaen. S O B © differentials are raoving
workers in the right directions\ others are xaoving the© in the wrong directions* Wellinformed people knew that the freese would greatly increase dsumnds for non-monetary
concessions and benefits to workers* they also knew that the freeze would shift emphasis
from wage incentives to non-monetary ways of moving workers from less, to more essential
jobs. These ways cover th© whole range from just letting people know #ier© jobs ar© to
forcing them to tafce jobs that the Goirernmeiit considers essential•
The general trend of decisions by the War Labor Board on wage increases is
now in the right direction* The worse mistake that could be made woiild be to insist
on ©omplet© rigidity in the eixisting wage structure* fhe War Labor Board is avoiding
this mistake.
(2) What about a national SerVioe.Act? The President decided yesterday to
postpone action on a H&tional Service Act until some indefinite time next year*
Voluntary and compulsory methods are in conflict here just as in the fiscal field* Almost nobody wants compulsory methods! hence they will be postponed until they are long
overdue* Sxperienee abroad shows conclusively that voluntary methods will not work*
Apparently the Administrationsnd th@ American people will have to discover this truth
the hard way*
(3) Who should control manpower policy? The only hope of putting some economic
sense into the manpower picture lies in giving the Manpower Commission, under MoNutt,
real, instead of its present nominal control over the operations of the Selective Service
System* Although Hershey has managed to get along with Congress, both his public
statements and his specific policy actions show his ignorance of and lack of interest in,
the economic considerations that should underlie manpower policy*
iv"K.:agb