Senator COUZENS. There is just one thing we got switched off on. I understand there is a committee being appointed to reduce the cost of this work to the potential borrowers.

Mr. ECCLES. Yes.

Senator COUZENS. I am still anxious to know what this committee plans to do in the way of reducing the cost to the potential borrowers. In other words, we got switched off. We understood, of course, there was going to be no interference with the manner in which a borrower let his contract, but, as I understand, there is going to be some general guidance from the Government to inform the people as to how they may reduce the cost of this work.

Mr. ECCLES. Yes.

Senator COUZENS. I still am concerned about what their program is going to be.

Mr. ECCLES. The committee that has been working on this whole program, Mr. Walker, Mr. Hopkins, Mr. Fahey, and myself and several others, have realized the necessity of getting costs reduced, and certainly preventing them from going up further as a result of of this increased activity, in order to prevent the borrower from undertaking an uneconomic debt. There are others who have been working on this, Senator. Although I have heard the matter discussed, I would prefer to have Mr. Walker, or possibly Mr. Deane, who has been working with us, and also has been working over at the N.R.A. with Mr. Harriman and Mr. Johnson on the problem, discuss it. He would be better able to give you up-to-date information on that.

Senator COUZENS. I would like to have some information on that, because I am concerned with how you are going to proceed, whether you are going to recommend certain prices for lumber, certain prices for labor, certain prices for brick, certain prices for cement, and so forth. Just how are you going to reduce the price, or the cost to these potential borrowers?

Mr. ECCLES. These various associations have indicated a willingness and a desire to cooperate and to make tenders. What we are anxious to do is to have concerns like Johns-Manville, American Radiator, the lumber people, and the cement people, and others, come in as a part of this thing, and agree to give price concessions during a certain period of this drive, rather than for us to go to them and request that they do it. We feel that it would be better for them to do it, and they have indicated a willingness to do it. I know they are working upon it now with the idea of doing that very thing. Senator COUZENS. Are they going to bring in the labor unions, too?

Mr. ECCLES. I could not say.

Senator BULKLEY. Are they going to issue any bulletins as to what would be fair prices for labor?

Mr. ECCLES. It would seem to me that the situations vary so greatly in various parts of this country that it would not be possible. The cost of living in the centers of the East is entirely different from the cost in the South and in certain parts of the West. There is a great variation of cost.

Senator BULKLEY. Of course, there could be separate bulletins, but I am asking about the policy, and whether such a thing has been attempted.

Mr. ECCLES. I could not tell you. I do not think that has been discussed or decided.

Senator BARKLEY. I do not think we could work out such details as that at this stage of the proceeding.

Mr. ECCLES. No. It has all been more or less preliminary.

The CHAIRMAN. That will conclude your statement. We can call you again.

Mr. ECCLES. Yes. I am here, and will be glad to come any time. The CHAIRMAN. We will have the Secretary of Labor now.

STATEMENT OF FRANCES PERKINS, SECRETARY OF LABOR

The CHAIRMAN. Madame Secretary, we will waive the formal questions about your name, age, and place of residence.

Secretary PERKINS. I shall be delighted to tell all if you want me to. [Laughter.]

The CHAIRMAN. We will just begin by saying that the Secretary of Labor is present, and we desire to hear from her.

Secretary PERKINS. Senator, I shall, with your permission, not discuss the aspects of the bill which Mr. Eccles has just discussed, as he is infinitely wiser than am I on the banking and mortgage feasures which are before you. Mr. Eccles is much wiser than I am on the banking arrangements and on the mortgage arrangements which have been made. As you know, the special subcommittee that had the matter in charge did give that matter very great consideration. The part which the Department of Labor played in the work of the subcommittee was merely to canvass the need for this bill, and it is upon that, sir, that I should like to report to you and to your committee this morning.

It seems to me that this is, at the present time, one of the most essential features of the recovery program, for, as you know, there has been a stimulation to private industry due to the Public Works program, the results of which are just beginning to be shown.

You are aware, I am sure, of the unequal character of the reemployment in different types of industry. Whereas there has been a very large reemployment in the industries manufacturing the consumer's goods, the reemployment in what are called the "durable goods industries, the capital goods industries, those industries making materials that go into building construction, has not been by any means so good.

Nevertheless, for the past few months, under the impetus and under the stimulus of the purchasing made necessary by the Public Works program, we have seen a considerable recovery, a considerable reemployment, and a considerable increase in pay rolls in those particular industries. They are, however, as we must admit, very fargely the result of the purchases which have been stimulated all down the line, and it is extremely important that we maintain employment and increase employment in those manufacturing industries, very largely because of the fact that when we look at the total employment in the United States of America over a period of normal years, we recognize that in the manufacturing industries, in the manufacturing employments, the durable goods industries employ about 60 percent of the total number of people working in manufacturing, so that it is very important that they should have

a rise comparable to the rise in employment that has taken place in the consumer goods industries.

The Public Works program is proceeding in an orderly manner, and I think as rapidly as can be expected. It will reach its peak of employment, so we now believe, its peak of direct employment on public works, sometime in the latter part of August and the first half of September. At that time, if the estimates which we have made are correct-and they are based upon best belief and information only-there should be about 1,000,000 men at work on direct employment on public works. We are approaching that peak. After that there is likely to be a falling off, gradually, but nevertheless a falling off.

Also, as you realize, October is the peak month in private employment in manufacturing. That is true in every year, whether it is a good year or a bad year. October and March are the 2 peak months, with October usually slightly higher than March in the industrial employment and industrial pay rolls. So that we have every reason to believe that August and September will show the peak in direct employment on public works; that October will show the peak in private employment in manufacturing generally, and that we must, therefore, be thinking about the types of employment that will be open to our people during the months that follow October-in November, December, January, and February, until we again reach the swing up, which usually occurs in the spring.

This type of work which is to be stimulated, which it is proposed to stimulate in the way described in this bill, is an extremely important piece of work, not only because if it is carried out consistently and in the way in which we have every reason to believe it will be, it makes it possible to raise the standard of living of a very large part of the community, and it does necessary work in the maintenance of really important capital investments in homes, but because it gives work to exactly the same type of people who have been lacking work for so long a time.

As you know, employment in the building industries was very much depressed. It is almost impossible to measure with any exactitude the amount of employment or unemployment in the building industries, because of the fact that our reports have to come to us from contractors, as to the number of persons employed. As you know, the contracting business is an irregular business. Sometimes firms do not stay in the contracting business. During a boom period there are a very large number of contractors who, after the boom period, go out of the business, so that their reports to us on their number of employees become very irregular. We have not, therefore, for the building trades and the building industries, anything like the same accurate information that we have on manufacturing or other more stable business establishments.

Senator BARKLEY. Do you get reports from the Carpenters Union and other unions as to employment?

Secretary PERKINS. The unions, of course, can give you the number of their members who are employed or unemployed, but you realize that in boom times there are a great many men in the building trades who are not members of those unions, so that to get the full picture you would have to get reports from the employers in the contracting business.

Nevertheless, basing our estimates upon reports made by such contractors as do have a stable business existence, and therefore report their number of employees over periods of years, and based upon reports of the unions in the building trades, we estimate that there are today at least 2,000,000 building-trades workers who are out of work.

This is a very serious matter, because of the fact that the building trades represent highly skilled mechanics, as you know, people who have in good times been well paid, who are accustomed to a high standard of living, and therefore, are ready spenders. The money they earn goes readily into the market in the form of purchasing power, and they, too, begin to buy. So that a plan for the bona fide reemployment of this large pool of unemployment in the building trades is extremely important.

It is also important that we should look forward to stimulation of the reemployment of the people who work in the durable-goods manufacturing enterprises. As a group, we find that employment in durable-goods industries fell from about four and a half million people who were working in the industries known as durable-goods industries, in March 1929, to about 1,900,000 in March 1933. That represents a loss of approximately 22 million people who were formerly employed in manufacturing in these durable-goods industries. These are the industries which are largely called upon to supply the needs of the building program, to supply the materials that go into buildings. In the month of April of this year the employment in these durable-goods industries was 2,909,000, showing that there are still 12 million people who look to employment in these industries who have not been reabsorbed into these industries. They are attached to these industries. They think of themselves as working in these industries. They frequently live in an area where these industries are the only employment to which they can look. So that there are about 12 million people in the durable-goods industries who still remain to be absorbed.

Senator BARKLEY. That does not include unemployment in the building trades, who use those materials in construction.

Secretary PERKINS. That is correct. That is in addition.

Senator KEAN. How many people do you estimate now are out of employment?

Secretary PERKINS. You have asked a question which no one in America can quite accurately answer.

Senator KEAN. I asked you for an estimate.

Secretary PERKINS. I would be glad to indicate the very great limtations upon the power to make an estimate. We never have known how many people were out of work, in actual number, in this country. We therefore have to estimate from the guesses that were made. As you know, in 1933, estimates as to the number of persons unemployed varied all the way from 8 million to 171⁄2 million, the larger number, 1712 million, being the figure prepared by the Alexander Hamilton Institute, and the 8 million being the figure of the National Industrial Conference Board. Somewhere between those two was the accurate number.

It is a very difficult figure to estimate. Most people have used the figure 13 million without much critical analysis as to whether

it was the correct number or not. But if 13 million be the correct number of persons out of work, then you can estimate something like this: That 234 million have gone back to work in private employment; that 350,000 people are now employed in the C.C.C. They are off the unemployment lists and are working in the forests, not at regular employment but at maintenance levels.

Senator KEAN. What I was trying to get at was this: There were so many people out of work in March 1933. Then, there are so many people that you have put to work in public institutions. How does that compare? If you did not have those people, would the same number be out of employment now, or would it be less?

Secretary PERKINS. If we did not have people on Public Works? Senator KEAN. Yes.

Secretary PERKINS. No; 2,750,000 have returned to work in private manufacturing, and in addition to that 350,000 are at this moment at work on Public Works; 350,000 are in the C.C.C. That is public employment, of course.

Senator KEAN. Yes.

Secretary PERKINS. There is, in addition to that, an inaccurately measured reemployment in agriculture, which is, of course, seasonal, and which, in July of last year, we estimated to be 500,000. It reaches its peak about July, and will this year again be about the same in agriculture.

In addition to that, there is an increase also in employment in what are called the "services", which are also not very accurately measured in this country, because we do not know their numbers. Those are the people engaged in automobile washing, in barber shops, laundries, and that sort of enterprise. It is called, not manufacturing, but service trades of one sort and another. They go up as pay rolls and income go up, because they are services performed for people who are spending their income.

It is fair to say that if there were 13 million out of work in 1933, which was the estimate we made, that has been reduced to somewhere between 8 million and 9 million today, but that is the roughest kind of estimate.

Senator KEAN. There must be at least 2 or 3 million of those people engaged in public works.

Secretary PERKINS. Not in public works direct.

Senator KEAN. In building post offices and buildings of that sort. Secretary PERKINS. I think the most you could say would be something under 1,000,000.

Senator KEAN. You think it is under 1,000,000?

Secretary PERKINS. In direct employment, yes; because all you can count as being engaged in direct employment on public works are the 350,000 at this moment working in the true Public Works program and the 350,000 in the C.C.C.

Senator BARKLEY. Those two items would make 700,000 taken care of by the Public Works or the C.C.C.

Secretary PERKINS. Yes.

Senator BARKLEY. There is no other item of public employment. Secretary PERKINS. No other item of public employment. The rest, something under 1 million of them, can be put down to direct public employment. The indirect public employment is not capable