You will Mr CHAIRMAN AND MEMBERS OF THE COMMrres. Spice I appeared before Your Littee and testified on last week, I have secured some very important information that I wish to present to your committee at Pis time recs.. that in my testimony I gave some wage rates of a number of cotton mills but not any rates relative to the mill that I am not presenting to you The folowing is a partial list showing number of hours and wakes for pay roll, week en ding February 1, 1936, Marlboro Cotton Mills. You will note that I ani not giving the names, but under separate cover I am mailing to you the envelopes which on the back shows the name, wages, and hours as made out by the camp lover in their own figures: The above rates of a number of workers are taken from the Marlboro Cotton Mills, Bennettsville, S. C., Mr. G. K. McColl is president who for the year 19645 made a salary and bonus of $96,485. These workers at this mill are in #VOLY deplorable condition as others over the country and you enn rendily see what a condition this is with such low wages and long hours, these people can hardly exist on these few dollars per week, and all the while these people are suffering under these conditions to build up profits for the employer Because of these deplorable conditions over the country in our reason for trying to secure national regulation of the industry. Unless some relief is given to theen people over the country, unless there is Federal regulation, the workere are going to take it in their own hands, and there will be more strikes in this industr. than there has ever been. We all appreciate the consideration and efforts by your committer, it waa indeed a pleasure for me to testify before you in Washington Thanking you all, I am, Very truly yours, L. JAMES Jou seun, MILLS WHICH REFUSED TO CARRY OUT THE DECISIONS OF THE TEXTILE LABOR RELATIONS BOARD GEORGIA Aragon Mills, Aragon; Arnell Mills, Sargent; Arnco Mills, Newnan; Atlanta Woolen Mills, Atlanta; Peerless Woolen Mills, Rossville; Atlantic Cotton Mills, Bibb Manufacturing Co., Macon; Bibb Manufacturing Co., Macon; Bibb Manufacturing Co., Osprey; Bibb Manufacturing Co., Porterdale; Callaway Mills, at La Grange, Milstead, and Manchester; Eagle-Phenix Mills, Columbus; Exposition Mills, Atlanta; Forsyth Cotton Mills, Forsyth; Fulter Bag & Cotton Mills, Atlanta; Scottdale, Mills, Inc., Scottdale; Stark Mills, United States Rubber Co., Hogansville; Strickland Cotton Mills, Valdosta; Trio Manufacturing Co., Forsyth Gate City Cotton Mills, at Fastpoint and Egan; Georgia-Kincaid, Griffin; Globe Cotton Mills, Augusta; Sibley Cotton Mills, Augusta; Enterprise Cotton Mills, Augusta; John P. King Manufacturing Co., Augusta; Goodyear Clearwater Mills, at Cedartown and Atco; Grantville Cotton Mills, Grantville; Harmoney Grove Cotton Mills, Commerce; Mandeville Cotton Mills, Carrollton; Meritas Cotton Mills, Columbus; Monroe Cotton Mills, Monroe; Muscogee Manufacturing Co., Columbus; Southern Brighton Mills, Shannon; Pepperell Manufacturing Co., Lindale; The Piedmont Mills, Egan; Riverside Mills, Inc., Augusta; Sommerville Cotton Mills, Sommerville; Swift Spinning Co., Columbus; Trion Manufacturing Co., Trion; Crystal Springs Bleachery Co., Chickamauga. ALABAMA Adelaide Mills, Anniston; Alabama Mills Inc., Fayette; Haleyville, Jasper, Russelville, Winfield; Avondale Mills, Birmingham; Stevenson; California Cotton Mills. Sunset; Cherry Cotton Mills, Florence; Dwight Manufacturing Co., Alabama City; Florence Cotton Mills, Florence; Mobile Cotton Mills, Crichton; Mt. Vernon Woodbury Mills, Tallassee; Pepperell Manufacturing Co., Opelika; Saratoga Victory Mills, at Albertsville and Guntersville; Selma Manufacturing Co., Birmingham; Southern Mill Corporation, Oxford. MISSISSIPPI J. W. Sanders Cotton Mills, Magnolia; Starksville; Stonewall; Kosciusko; VcComb. TENNESSEE Standard Coosa Thatcher Co., Chattanooga; Harriman Hosiery Mills, Harriman; Bemis Bag Co., Bemis; Brookside Mills, Knoxville; Cherokee Spinning Co., Knoxville; Dyersburg Cotton Products Co., Dyersburg; Kingsport Silk Mills, Kingsport; Mountain City Knitting Mills, Chattanooga; Nick-a-jack Hosiery Mills, Chattanooga; Trenton Mills, Inc., Trenton. Houston Textile Co., Houston. TEXAS NORTH CAROLINA Worth Spinning Co., Stoney Point; Spoffard Mills, Wilmington; St. Pai's Mills, St. Pauls; Groves Thread Co., Gastonia; Alexander Mills, Forest City; Florence Mills, Forest City; Phoenix Mills, Kings Mountain; American Enks Corporation, Asheville; American Yarn & Processing Co., (Adrian Mill Mt. Holly; Bellevue Manufacturing Co., Hillsboro; The Belton Cotton Mills Co., Shelby; Bonnie Cotton Mills, Kings Mountain; Borden Manufacturing Co.. Goldsboro; Frookford Mills, Brookford; Brown Manufacturing Co., Concord: Byrum Hosiery Mills, Shelby; Cannon Mills Co., Concord, Mill 2, mill 5; Rockfish Mills, Hope Mills; Carter Mills. Lincolnton; Chadwick-Hoskins Mills. Charlotte; China Grove Cotton Mills, China Grove; Chronicle Mills, Belmont; Cliffside Mills, Cliffside; Crescent Spinning Co., Belmont; Dilling Mills, Kings Mountain; Dover Mills, Inc., Shelby; Entwistle Manufacturing Co., Rockingham; Erlanger Cotton Mills, Lexington; Eton Mills, Shelby; Excel Manufacturing Co., Lincolnton; Flint Manufacturing Co., Gastonia; Fountain Cotton Mills, Tarboro; Glenn Manufacturing Co., Lincolnton; Grace Cotton Mills, Ruthertong Hamman Ficket ils, Rockingham; Rosemary Mills, Roanoke Manu.a.turi. Co., and Patterson Mills, Roanoke Rapids. SOUTH CAROLINA Piedmont Manufacturing Co., Piedmont; Duneen Mills, Greenville; American Spinning Co., Greenville; Lonsdale Mill, Seneca; Winnsboro Cotton Mills, Winnsboro; Spartan Mills, Spartanburg; Pelzer Manufacturing Co.. Pelzer; Ware Shoals Manufacturing Co., Ware Shoals; Alice Manufacturing Co., Ariel plant, Easley; Beaumont Manufacturing Co., Spartanburg; Belton Mills, Belton; Clinton Cotton Mills, Clinton; Conestee Mills, Conestee; Cowpens Mills, Cowpens; Cutter Manufacturing Co., Rock Hills; Darlington Manufacturing Co., Darlington; Victor-Monaghan Mills, Greenville and Greer; Drayton Mills, Spartanburg; Hampton Spinning Co., Clover; Hermitage Cotton Mills, Camden; Rock Hill Printing & Finishing Co., Rock Hill; Jackson Mills, Iva; Judson Mills, Greenville; The Thrift Plant, Kendall Co., Pau Creek; Laurens Cotton Mills, Laurens; Lydia Cotton Mills, Clinton; Matthews Cotton Mills, Greenwood; Greenwood Cotton Mills, Greenwood; Ninetysix Cotton Mills, Ninetysix; Norris Manufacturing Co., Cateechee; Piedmont Print Works. Taylor; Springs Cotton Mills, Baldwin, Eureka, Springstein, at Chester, Fort Mills, and Lanchaster. Hon. KENT E. KELLER, UNDERWEAR INSTITUTE, House of Representatives, Washington, D. C. MY DEAR MR. KELLER: To you and your committee on hearings on the Ellenbogen bill I wish to express my regret that illness prevents my being present. Attached is the economic brief of the underwear and allied products industry in opposition to the Ellenbogen bill. I am pleased to make available to you and your committee the services of Mr. Francis Simmons, statistician and economist of the Underwear Institute, to outline the nature of our brief and to undertake to answer any questions which you wish to ask. Very truly yours, ROY A. CHENEY, Managing Director. P. S.-Owing to your committee's inability to receive our testimony on Friday, January 31, as scheduled, the institute has instructed me to file this formal brief with you and to return to New York. It is our sincere hope that this brief may be helpful in your consideration of the Ellenbogen bill, and our regret over loss of the opportunity for discussion if that could have been helpful. FRANCIS SIMMONS. ECONOMIC BRIEF OF THE UNDERWEAR AND ALLIED PRODUCTS MANUFACTURING INDUSTRY IN OPPOSITION TO THE ELLENBOGEN BILL By Francis E. Simmons, statistician and economist, Underwear Institute SUMMARY The Underwear Institute, representing the underwear and allied products industry, wishes to record the following points in opposition to the passage of the Ellenbogen bill: 1. The product of our industry is such that increased manufacturing costs cannot be offset by increased physical volume to equalize unit costs. 2. Experience with the manufacturing cost increases occasioned by the National Recovery Act and the Agricultural Adjustment Act processing taxes has shown that consumer and buyer resistance does not permit passing along in full to the consumer additional manufacturing costs. 3. The underwear industry has seriously impaired its operating margin in absorbing a substantial part of increased manufacturing costs attendant to the Administration's recovery program. 4. The underwear industry has already made a very material contribution to employment and pay rolls during and since National Recovery Act. 5. Labor costs in the underwear industry have always been higher in relation to the value of products than in most other industries, so that any increase in labor costs is particularly burdensome. 6. Additional skilled labor as envisioned by the Ellenbogen bill would not be readily available in many instances. 7. Additional marginal employment is disproportionately 8. Increased labor costs would accelerate the displacement of man power by machinery. 9. The already high business mortality rate of our industry would be boosted. 10. Bureaucratic control of wages and hours is too inflexible to meet fairly the peculiar conditions or emergencies in individual industries. (a) Lack of protection from imports is a notable instance. I. NATURE OF THE UNDERWEAR INDUSTRY AS A FACTOR IN CONSIDERING THE The underwear and allied products industry includes some 600 mills, employing approximately 65,000 workers at an annual pay roll of more than $41,000,000. Approximately 85 percent of the annual mill sales volume, about $165,000,000 at present levels, proceeds from the knitting of underwear fabrics and the cutting and sewing of such fabrics in the making of underwear. the volume is accounted for by woven cotton athletic types of underwear, cut Another 10 percent of and sewn from woven cotton fabric. provided by the knitting of fabrics for work gloves, meat bagging, etc. The remainder of the industry volume is appraisal of the characteristics of this industry is important to an understanding of the reasons for its opposition to the Ellenbogen bill, or any similar measure which has the effect of increasing manufacturing costs. An The Ellenbogen bill, calling for a 35-hour week with a $15 minimum weekly wage, requires an hourly wage rate of 42.85 cents. adhering to former National Recovery Administration code wages and hours, The underwear industry is namely $12 a week in the South and $13 in the North for a 40-hour work week, that is, hourly rates of 30 cents and 321⁄2 cents, respectively. It is obvious, therefore, that the labor rates in underwear manufacture would be advanced 42.8 percent in the South and 31.8 percent in the North by the provisions of the Ellenbogen bill. The manufacturer normally has the following alternatives in accounting for increased manufacturing cost: (1) To increase output so as to restore the cost per unit of manufacture, (2) to maintain present output and absorb the increased cost, if possible, or (3) to maintain present output and pass the added cost along to the consumer in higher prices. The facts at hand indicate that the underwear industry would find the first two alternatives impossible under present conditions and the last alternative extremely difficult, if not impossible. It is at this point that it becomes desirable to consider the nature of the und wear industry. Its product is a staple for which the demand is apparent inelastic. The circumstances attending the output of a commodity for when the demand is inelastic, and the effect of changing personal habits which teri to minimize the amount by weight and units of underwear worn, are cleari reflected in production records of the industry. United States Bureau of the Census, show very clearly that the number of dozers These data, compiled by the of garments, as well as the equivalent units in full-piece garments: (1) Declined during the advancing prosperity from 1927 to 1929, (2) further declined from: prosperity year of 1929 to the depression year of 1931, and (3) were not by s means as great in the relatively good year 1935 as they were in 1927. The wh record indicates a relatively static position in underwear output, and no likelih that underwear manufacturers can safely plan to expand their output bey the rate of population increase or at such a rate as to place the unit cost u the provisions of the Ellenbogen bill at anything like the unit cost under curri manufacturing costs. The census data follow: Underwear production reported by Bureau of the Census -All underwear, &% suits, shirts, vests, drawers, shorts, panties, bloomers, etc. Year 24,200,000 1 Biennial Census of Manufactures for 1927, 1929, 1931, 1933. Monthly data for 1934 and 1935 Equivalent units are in terms of a full covering for the body; i. e., a shirt and short or a vest and equals a union suit. Data advanced further along in this discussion show just as clearly that underwear manufacturers could not possibly absorb any additional manufacturing cost, and that even under present conditions their operating margin has been trimmed to an unprofitable level. Also in connection with a later discussion of underwear prices it will be shown that the underwear industry has met with very definite consumer and buyer resistance in attempting to pass along increased manufacturing costs, resulting to date from the Administration's recovery program. II. UNDERWEAR INDUSTRY CONTRIBUTION TO EMPLOYMENT AND PAY ROLLS DURING AND SINCE NATIONAL RECOVERY ADMINISTRATION The underwear industry contributed notably to reemployment and to increased purchasing power through increased pay rolls during National Recovery Administration and has since maintained that record. In 1934, the only complete calendar year in which National Recovery Adminis tration codes maintained, underwear and allied products manufacturers reported to the Bureau of the Census and the Bureau of Labor Statistics an average of 57,755 employees, average weekly pay rolls of $753,000 and average weekly manhours worked of 1,906,000 hours. These manufacturers, according to estimates of the Bureau of the Census, represented 88 to 90 percent of the productive output of the industry, as measured against the 1933 Biennial Census of Manufactures. Therefore, 100 percent of the industry in 1934 would have had an average employment of 65,000 employees, average weekly pay rolls of $850,000, and average man-hours worked per week of 2,120,000. Making a very generous allowance of 4 weeks in the year for inventory and any other necessary shut-down, the annual pay roll for the underwear industry in 1934 (48-week basis) would have approximated $41,000,000. The total annual man-hours worked, on the same basis, would have been 101,760,000 hours, which, if paid for at the average actual wage rate prevailing prior to the National Recovery Administration codes, 29.2 cents an hour (Bureau of Labor Statistics Bulletin No. 591, p. 4, 1933), would have yielded for the same number of manhours worked an annual pay roll of $29,714,000. It is apparent, then, that the underwear industry, by virtue of National Recovery Administration wage rates and hour restrictions, boosted its annual pay roll more than $11,000,000 on the basis of 1934 business, or 37 percent. As to additional employment, if the 101,760,000 man-hours of work in 1934 had been distributed on the pre-code average of 38 hours actually worked per week per employee (50-hour work week), as reported by the B. L. S. Bulletin No. 591, supra, it would have engaged some 55,790 employees. Since the actual average employment in 1934 was 65,000 workers, it is apparent that because of National Recovery Administration employment provisions the underwear industry boosted its employment by more than 9,200 workers, or over 16 percent. The same Government records for 1935 indicate an improvement in the underwear industry of approximately 2 percent in employment and 6 percent in pay rolls, as compared with 1934, from which it is obvious that the industry has not only maintained but has actually improved upon the record established during 1934 under National Recovery Administration. In the 6 months subsequent to the Supreme Court outlawing of National Recovery Administration the average number of employees engaged by our industry was 7 percent greater than the number occupied in the same months in 1934. During the same period of 1935, hourly wage rates averaged 39 cents, which corresponds identically with the average for the full year 1934 under National Recovery Administration. This combination of additional employment and a sustained hourly wage rate, plus improvement in the work week during the business upturn subsequent to National Recovery Administration, resulted in a gain of 14 percent in pay rolls during the 6-month period June to November 1935, as compared with the same period of 1934. Current employment in the Underwear Industry compares very favorably even with that of the pre-depression years. The underwear industry in 1935 engaged 93 percent as many workers as it did in 1929, whereas in the general manufacturing industries the 1935 employment was only 78 percent of that for 1929. Indicating that the textile industry as a whole has done its part in reviving employment, is the fact that its employment in 1935 was at 91 percent of the level for 1929. These comparisons are based on records of the Bureau of Labor Statistics and the Bureau of the Census. |