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of the refusal of employing groups to eliminate sectional wage differentials. We in America will never become a really united Nation until we recognize that there is no justice in paying a man or woman less and working longer hours merely because they happen to live in a State with another name.
To illustrate the dangers of differentials in wage rates between one section of the country and another let me cite the situation in the fullfashioned section of the hosiery industry. Today more than 80 percent of the total production of full-fashioned hosiery is produced in unionized mills or in mills paying the union rates. It has been the tactic of the nonunion employer in the full-fashioned industry to pay union rates and enforce union conditions in order to make it difficult for the union to organize the employees in these plants.
There are some few mills in isolated sections in the North which pay below the prevailing rate in the industry which is the union scale. But in the South, where about 15 or 16 percent of the full-fashioned product is manufactured, the labor costs are considerably less than the costs in northern mills. Labor costs on a typical style in a northern mill paying prevailing rates to labor amount to about $2.10 per dozen. In the average full-fashioned mill in North Carolina, Tennessee, or Georgia, the labor costs on this same style will range from $1.50 to $1.65 per dozen. This means that the southern manufacturer has an advantage of from 50 to 65 cents per dozen. The importance of this differential will be recognized when it is known that the average selling price per dozen is from $5.50 to $6 per dozen. An advantage of 50 cents or more per dozen enables any manufacturer under present conditions to undersell his competitor and create a dangerously unstable condition in the hosiery market. It is true that only 15 to 16 percent of all full-fashioned hosiery is made in the South where labor costs are so much lower than in the industry as a whole. Nevertheless, the volume of production now made in the South is sufficient to endanger the stability of the entire industry.
As long as one area in the industry operates on the basis of distinctly lower wage rates the tendency of the whole industry will be to bring its labor costs down to those paid by the manufacturer whose rates are the lowest. There is a constant temptation on the part of the northern manufacturer to move South, and a constant friction exists between the employing group which pays lower rates than those paid in the industry as a whole. The market is constantly disturbed by the underselling of the mills which pay a substandard labor rate, and the whole outlook in our trade is unstable and uncertain. It has become quite clear that unless something is done to raise southern wage rates that we shall be faced with a very serious period of strikes and conflict and disturbance in the full-fashioned industry.
In concluding this statement, I wish to state that the experience of the employees and the employers also under the hosiery code was definitely beneficial. An examination should be made by your committee into the records of the hosiery code and the hosiery industry under the Hosiery Code.
For instance, the Hosiery Code Authority estimated in July 1934 that wage payments during the first 6 months, operation of the code increased from $792 per 1,000 dozen pairs prior to N. R. A. to $1,092 per 1,000 dozen pairs. The workers gained first by the shorter workweek and also by increases in wage payments of 37.9 percent, as the above figures show. The code wage rates and hour regulations are still standard in our industry, and we had a record-breaking year in our business last year for shipments and production. The point I am making is that hours, regulations, and uniform wage rates tend to increase sales and to enable manufacturers to earn modest profits.
There is, therefore, statistical proof available of our contention that the regulations contained in the Ellenbogen bill will be beneficial to our industry. The 35-hour-workweek regulation is somewhat shorter than the 40 hours that our code provides. Investigation will prove that the Hosiery Code did, in July 1934, of its own motion seek to have the code amended to provide a 35-hour workweek. Previously a period of curtailed production had been enforced because the output of the industry had jumped so alarmingly that it was necessary to hold down production for a time.
What took place in the textile industry and hosiery industry was that double-shift operation increased so widely when hours were reduced that total production was stepped up. The benefits of this situation however are obvious. The principal purpose of shortening hours is to create more jobs and to aid economic recovery. It is not always possible, of course, to know just how far hours should be reduced. Forty hours is clearly too long a workweek in hosiery. But it is also very clear that when hours are cut more people are put to work. A great many additional persons were added to the pay rolls in the hosiery industry as a result of the reduction in hours. Before the codes were installed the number of workers on the pay roll was about 90,000. Last year the number on the pay rolls was over 140,000.
To summarize, therefore, let me say that the 35-hour workweek will in our opinion provide steady operation in the industry and enable the employer, the employee, and the public to benefit from improved conditions in the industry. Government regulation in the past has increased employment, wage payments, production, and profits in the hosiery industry. There is ample proof available from impartial sources that this situation will hold true as a result of the application of the National Textile Act. We strongly urge that this bill be enacted into law as rapidly as possible.
Mr. KELLER. Mr. Wood, have you any questions?
Mr. Wood. No, Vr. Chairman; I have not. But I will say that it was a mighty fine statement and the best that I have heard since we opened the bearings.
Mr. ILARTLEY. Did the voluntary codes which were proposed by the industry after the abolition of N. R. A. include only agreements on hours and wages?
Mr. RIEVE. It included hours and wages and certain fundamental fair-trade practices.
Mr. HARTLEY. Did it also include price fixing?
Mr. RIEVE. The original hosiery code did not contain provisions for price fixing and, therefore, the voluntary code did not.
Mír. HARTLEY. What reasons do you ascribe for the failure of the voluntary code?
Mr. RIEVE. Because of the natural human element. No competitors can agree to regulate each other. Economic forces are at work, and when one of them feels that he can get a big order provided he sells at a little cheaper price, he starts to chisel, and then the next fellow sees that and says that if Tom Jones can get away with it then he can. So you have a constant chain which works in that operation. Mr. HARTLEY. Have you any figures to show the break-down in wages since N. R. A.?
Mr. RIEVE. Yes; we have.
Mr. HARTLEY. And also any figures concerning these increases in hours?
Mr. RIEVE. Yes, sir; we have some figures available.
Mr. HARTLEY. Will you present those figures to the committee, if you have them available at the moment?
Mr. RIEVE. I think I have them in my bag here. I estimate that the break-down is about 10 percent.
Mr. HARTLEY. You say you estimate that the break-down is about 10 percent? Mr. Rieve. Yes, sir; it is about 10 percent.
Mr. HARTLEY. Is that in the industry generally or just in certain plants?
Mr. RIEVE. No, no; it is certain plants. Out of 750 plants in the hosiery industry throughout the country about 10 percent of them have broken the standards either in hours or in wages.
Mr. Wood. That will eventually cause the other ones to lower standards in order to meet them?
Mr. RIEVE. About 6 percent of them occurred within the last 4 or 5 weeks. I am sorry to say that in your own State we have a strike, in Griffith, Ga. We had the strike last week.
Mr. HARTLEY. Where is that in my State? Is it up in Paterson?
Mr. RIEVE. Oh, pardon me, sir. I had you mixed up with Congressman Ramspeck. I have a number listed.
Mr. Wood. And you have that available for the record, have you? Mr. RIEVE. Yes, I have it right here. (The document referred to is as follows:)
Name of company
Operating per week
Leggers, 45 hours; others, 4219 hours.
11 p. m. to 3 a. m.; leggers depart-
Note.-Practically all mills in South are working footer shifts 40 hours.
Mr. Wood. In these factories which have lowered the standards of wages and increased the hours, that has amounted to more than a 10-percent reduction in wages?
Mr. RIEVE. Oh, yes. There are 750 mills in our industry, both the full-fashioned and seamless throughout the country, and my estimate
, is that in 10 percent of the mills that has been done. Wages were cut at Martinsburg, W. Va., 2 weeks ago from 12 to 22 percent, and at Griffith, Ga., last week, 25 percent. They were at the minimum, then which was $13 per week.
Mr. Wood. What is the average of the stretch of hours of these 10 percent which have increased their hours and reduced the wages?
Mr. RIEVE. I would not want to guess about it, and I do not have the figures available. I think we can supply these figures before the hearings are over and will be able to place them in the record. I think we have the information available.
Mr. Wood. I have an idea that your hours have been stretched about 10 a week.
Mr. RIEVE. We have instances where hours have been stretched to 60 hours.
Mr. HARTLEY. In connection with mechanics working on looms, and one thing or another?
Mr. RIEVE. That is correct. And not only mechanics, but also our women. Our industry employs about four women to one man. We have instances in some of our Southern States where the hours of women were stretched from the original 40 hours to 60 hours, because there are no State laws governing the hours of women.
(Mr. Ellenbogen, Representative from Pennsylvania, submitted the following letters:)
CONGRESS OF THE UNITED STATES,
HOUSE OF REPRESENTATIVES,
Washington, D. C., February 12, 1936. Hon. KENT E. KELLER,
House of Representatives. DEAR COLLEAGUE: I will appreciate it very much if you will have the enclosed letter from the American Federation of Hosiery Workers inserted in the textile hearings. With kindest regards, Very sincerely yours,
ANERICAN FEDERATION OF RoseRY WORKERS,
Indianapolis, Ind., February 4, 1936. Hon. HENRY ELLENBOGEN,
House Office Building, Washington, D. C. MY DEAR CONGRESSMAN ELLENBOGEN: Enclosed please find a letter that is being sent by Branch No. 35 to Representative Griswold asking for support on the bill you have so ably presented, and after you read the same you will see the reasons that the hosiery workers, along with the textile industry, are so anxious that their industry he regulated.
We would appreciate that these facts be read in the records and support of your bill and you can rest assured that hundreds of thousands of workers throughout the United States will appreciate these facts being known public, because we are convinced that without regulation, our industry is on the way to the old method of “dog eat dog” as prevailed prior to the introduction of the N. R. A., which did regulate hours and provided minimum code wages.
Thanking you on behalf of the members of Branch No. 35 of Indianapolis, I remain, Sincerely yours,
WALTER TRUMAN, District Manager.
FEBRUARY 4, 1936. Hon. Mr. GLENN GRISWOLD, Representative from Peru, House Office Building,
Washington, D. C. MY DEAR CONGRESSMAN GRISWOLD: Branch no. 35 of the American Federation of Hosiery Workers are asking your support on the Ellenbogen bill, which is now being presented in Washington for the textile industry. If ever an industry needed regulation, the textile industry does, and anything you do on this matter will be appreciated by hundreds of thousands of workers throughout the United States.
Since the departure of N. R. A. manufacturers are drifting back to the "dog eat dog' days as prevailed before the N. R. A.
We have in Indianapolis, for instance, the Real Silk Hosiery Mills, who not only chisel their workers and pay them rates below the union standards, but have tried and succeeded in increasing hours since N. R. A. was lifted. They increased hours of labor from 40 hours to 50 hours per week in their finishing department, without any overtime rates being paid, and when the rush was over in these departments, the workers now average 20 to 25 hours per week, with no consideration whatsoever.
In the footing department, which had a regulation under N. R. A. to work two shifts of 36 hours per week each shift. This too was increased to 40 hours per week, each shift, and continued and only stopped under threat by the workers themselves, who were taking it upon themselves to talk strike.
Recently in the Real Silk Mills they had a department known as the swatch department in the mill, and this department was paid the code minimum wage of $13, we believe, and at any rate they weren't paid any more. Recently this department has been moved out of the mill to private dwellings on Noble Street, Indianapolis, with a few instructors from the mill and they are now paying this department 15 cents an hour, increased the hours from 40 to 50 per week and for the 50 hours these girls receive $7.50.
At the National Hosiery Mills, Indianapolis, since N. R. A. was lifted, they too have forgotten about code wages and besides thai have been working girls 65 hours per week, and when the girls complain about it this management told them they could get the hell out, as there were a lot of unemployed girls in the city of Indianapolis, who would be glad to have a job.
These facts are some of the things that are happening in this city. It is needless for me to tell you that the same thing is happening all over the country and I would appreciate it very much, when you are speaking in favor of this bill, that you introduce this as testimony on behalf of the workers.
Trusting you will give this your utmost consideration, and with best wishes, on behalf of executive board branch no. 35, of the American Federation of Hosiery Workers, Indianapolis, I remain, Sincerely yours,
WALTER TRUMAN, Disirict Manager. Mr. HARTLEY. Is that a rare case or has that been done in several instances?
Mr. RIEVE. In several instances, but they are rare. But the disease, in my opinion, has started to work and if it is not checked the cancer will keep on growing until we have the same conditions that we had in 1932.
Mr. HARTLEY. Have you found any tendency on the part of employers in the industry to try to block the Wagner-Connery bill?
Mr. RIEVE. Oh, yes; very much so.
Mr. RIEVE. We suffer from all the ills that any other industry suffers from. And that covers a multitude of sins.
Mr. HARTLEY. Perhaps I am the one member of the committee who should have asked the question that the chairman asked. Have you found any that have cooperated?
Mr. Rieve. Oh, yes; especially in the full-fashioned industry we have closed shops with about 40 percent of the manufacturers of