Case Studies of 

Displaced Workers

iixperiences of Workers After Layoff

Bulletin No. 1408

U N H ID STATIS DEPARTMENT OF LABOR 

W. Willard Wirtx, Secretary

BUREAU O F LABOR STATISTICS 

f w « n Commissioner

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Case Studies of 

Displaced Workers

Experiences of Workers After Layoff

Bulletin No. 1408

UNITED STATES DEPARTMENT OF LABOR 

W. Willard Wirtz, Secretary

BUREAU O F LABOR STATISTICS 

Ewan Clague, Commissioner

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P refa ce

The displacem ent of w ork ers is too often one of the costs of industria l p ro g re ss. The full extent of such costs to individual w ork ers, how ever, 

is not always recogn ized. The Bureau of Labor Statistics has conducted 

five case studies of the p o st-la y o ff experien ces of close to 3,000 w ork ers 

who had been em ployed in different m anufacturing industries in various 

regions of the country.

The study is part of the Bureau of Labor Statistics resea rch p r o ­

gram on the im plications of technological and other changes and is designed 

to support the activities of the Departm ent of Labor and of other agencies 

in carryin g out the ob jectives of the M anpower D evelopm ent and Training 

A ct.

The Bureau of Labor Statistics appreciates the cooperation of the 

com panies and unions involved, and the individual displaced w ork ers who 

provided the inform ation upon which this report is based. The Bureau is also 

grateful to the Bureau of Em ploym ent Security and to loca l offices of State 

em ploym ent serv ice agencies which furnished data for the study.

The bulletin was prepared by H erbert H am m erm an under the su p ervision of Edgar W einberg, Chief, D ivision of T ech n ological Studies, under 

the general d irection of Leon G reenberg, A ssistant C om m ission er for 

P roductivity and T ech n ological D evelopm ents. The surveys w ere conducted 

and data tabulated by Jam es F. W alker, Chief of the Branch of Labor 

R equirem ents, assisted by Leon R. Kaye.

111

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CONTENTS

Page

I. Introduction and s u m m a r y .......................................................................... 1

I n t r o d u c t io n ........................................................................................ . . 1

S u m m a ry........................................................................................................... 2

F a ctors influencing d is p la c e m e n t................................................... 2

L abor m arket c o n d itio n s ...................................................................... 2

M easures to prevent d is p la c e m e n t ............................................... 2

M easures to help displaced w ork ers find j o b s ....................... 3

M easures to m aintain in c o m e ............................................................ 4

P erson al ch a ra cteristics of the displaced w ork ers .... 5

Job hunting e x p e r ie n ce .......................................................................... 5

Job effects of d isp la cem en t................................................................. 8

II. A layoff at a m odern ized petroleum r e f i n e r y ..................................... 11

D escription of p la n t .................................................................................... 11

M easures to ease d isp la ce m e n t............................................................ 11

P erson al ch a ra cteristics of the displaced w o r k e r s ................... 12

Job hunting e x p e r ie n c e ............................................................................... 14

Some job effects of d is p la c e m e n t ........................................................ 21

III. A closed autom otive equipment p la n t........................................................ 23

D escription of p la n t .................................................................................... 23

M easures to ease d isp la ce m e n t............................................................ 23

P erson al ch a ra cteristics of the displaced w o r k e r s ................... 26

Job hunting e x p e r ie n c e ............................................................................... 27

Som e job effects of displacem ent ........................................................ 43

IV. P artial closin g of a glass jar p l a n t ........................................................ 47

D escription of the p l a n t .......................................................................... 47

M easures to ease d isp la ce m e n t............................................................. 48

P erson al ch a ra cteristics of the displaced w o r k e r s ................... 49

Job hunting e x p e r ie n c e ............................................................................... 51

Some job effects of d is p la c e m e n t ........................................................ 62

V. A closed floor coverin g p la n t ..................................................................... 65

D escription of p la n t .................................................................................... 65

M easures to ease d isp la ce m e n t............................................................. 65

P erson a l ch a ra cteristics of the displaced w o r k e r s ................... 67

Job hunting e x p e r ie n c e ............................................................................... 69

Some job effects of d is p la c e m e n t ........................................................ 76

v

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CONTENTS - - Continued

Page

VI. The closin g of two iron f o u n d r i e s ............................................................. 79

D escrip tion of the p la n t s ....................................................... 79

M easures to ease d isp la ce m e n t............................................................ 79

P erson a l ch a ra cteristics of the displaced w o r k e r s ................... 80

Job hunting experience ........................................................................... 82

Some job effects of d is p la c e m e n t ................................................... . 87

Appendixes

A . Scope and m e t h o d ......................................................................................... 89

B. B ibliography of displaced w orker s t u d i e s ............................ 93

Tables

1. P etroleu m R efin ery --R a n ge of separation pay o f displaced

w ork ers and average payment, by age g r o u p ....................... . 13

2. P etroleum R efin e ry --S e le cte d ch a ra cteristics and em p loyment status of displaced w ork ers .................................................... 15

3. P etroleum R efin ery--D u ration of unem ploym ent............................ 16

4. P etroleu m R efin ery--E m p loym en t of displaced w orkers

b efore and after term ination, by o c c u p a t i o n ............................ 18

5. P etroleu m R e fin e ry --T y p e s of industries providing

current j o b s ............................................................................................. 19

6. P etroleu m R efin ery--C h an ge in earnings level ....... 22

7. Autom otive Equipment P lant--U nem ploym ent insurance and

supplem entary unem ploym ent benefits ...... Q . . . 25

8. Autom otive Equipment P la n t--S elected ch a ra cteristics and

em ploym ent status of displaced w o r k e r s ...................................... 28

9. Autom otive Equipment P lan t--E m p loym en t of displaced

w ork ers by age group and educational le v e l. ....... 31

10. A utom otive Equipment P lan t--E m p loym en t status of

displaced w ork ers by sex and age g r o u p ....................................... 34

11. Autom otive Equipment P lan t--E m p loym en t status of

displaced w orker s by sex and educational l e v e l ........................ 35

12. A utom otive Equipment P lan t--E m ploym en t before and

after term ination, by occupation (excludes tra n sferred 

w o r k e r s ) ...................................................................................................... 36

13. A utom otive Equipment P la n t--T y p es of industries providing

current j o b s ............................................................................................. 37

14. Autom otive Equipment P la n t--S elected ch a ra cteristics of

w ork ers who tra n sferred to other plants of the com pany 

com pared with all displaced w o r k e r s ........................................... 40

15. Autom otive Equipment P lant--C hange in earnings level . . . 44

vi

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CONTENT S - - Continue d

Table s - - Continued Page

16* Glass Jar Plant--Selected characteristics and employment

status of displaced workers.............................................................. 50

17. Glass Jar Plant--Employment status of displaced workers,

by sex and age group . ....................................................................... 53

18. Glass Jar Plant--Employment status of displaced workers,

by sex and educational l e v e l ............................................ 54

19. Glass Jar Plant--Employment status of displaced workers,

by educational level and age group................................................. 56

20. Glass Jar Plant--Employment before and after termination,

by occupation........................................................................................ 59

21. Glass Jar Plant--Types of industries providing current jobs . 60

22. Glass Jar Plant--Change in earnings l e v e l ............................... . 62

23. Floor Covering Plant--Selected characteristics and employment status of displaced w o rk e rs................................................. 68

24. Floor Covering Plant--Duration of unemployment...................... 69

25. Floor Covering Plant--Employment status of displaced

workers, by selected age group and educational level . . . 72

26. Floor Covering Plant--Employment before and after

termination, by occupation.............................................................. 7 3

27. Floor Covering Plant--Types of industries providing

current j o b s ........................................................................................ 74

28. Floor Covering Plant--Change in earnings level........................... 76

29- Foundries--Selected characteristics and employment status

of displaced workers........................................................................... 81

30. Foundries--Duration of unemployment........................................... 82

31 o Foundries--Employment status of displaced workers by

selected age group and educational level . ............................... 84

32. Foundries--Employment before and after termination, by

occupation............................................................................................. 85

33. Foundries--Types of industries providing current jobs .... 86

34. Foundries--Change in earnings level................................................. 87

Charts

1. Petroleum Refinery--Personal characteristics of displaced

w o r k e r s ................................................................................................. 14

2. Automotive Equipment Plant--Personal characteristics of

displaced w orkers................................................................................ 27

3. Automotive Equipment Plant--Long-term unemployed as

percent of total displaced workers................................................. 29

4. Automotive Equipment Plant--Unemployment by--sex,

education, and age group.................................................................. 33

vii

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CONTENT S - - Continue d

Charts - - Continued Page

5. Automotive Equipment Plant--Comparison of selected

characteristics of transferred workers and all displaced

w o r k e r s ................................................................................................. 39

6. Automotive Equipment Plant--Change in earnings of reemployed workers, by age and education........................................ 45

7. Glass Jar Plant--Personal characteristics of displaced

w o r k e r s ................................................................................................. 49

8. Glass Jar Plant--Long-term unemployed as percent of total

displaced w orkers............................................................. 52

9. Glass Jar Plant--Unemployment by--sex, age, and education . 55

10. Glass Jar Plant--Change in earnings of reemployed workers,

by age and education........................................................................... 63

11. Floor Covering Plant--Personal characteristics of displaced

w o r k e r s ................................................................................................. 67

12. Floor Covering Plant--Long-term unemployed as percent

of total displaced workers, by age and education.................. 70

13. Floor Covering Plant--Change in earnings of reemployed

workers, by age and education..................................................... 77

14. Foundries--Personal characteristics of displaced workers . . 80

viii

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CASE STUDIES OF DISPLACED WORKERS

I. Introduction and Summary

Introduction

The experience with technological change in this century has demonstrated its long-term beneficial effects in terms of increased productivity,

faster economic growth, more jobs, and higher wages and employee benefits.

However, where technological change has been accompanied by plant

shutdowns or mass layoffs, it has had serious adverse effects on individual

workers.

The Bureau of Labor Statistics has conducted five case studies of the

effects of plant shutdowns or large-scale layoffs related in part to technological change in recent years. These studies concern plants in the following

manufacturing industries: petroleum refining, automotive equipment, glass

jars, floor coverings, and iron foundries. The plants were located in six

areas (4 in the Midwest, 1 in the East, and 1 in a Mountain State). The

number of workers displaced totaled close to 3,000, ranging from about 100

in one plant to more than 1,000 in another. The layoffs took place over the

period July I960 through June 1962. The surveys were conducted between

April 1962 and April 1963; and the periods between surveys and layoffs

ranged from 6 to 21 months.

These case studies supplement studies of displaced workers which

have been made over the years and which reflect varying economic conditions.

Noteworthy among industries covered by some recent studies were meatpacking, newspaper publishing, railroad equipment, textiles, and automotive

equipment. Appendix B lists a number of displaced worker studies conducted

prior to and after World War II.

This chapter summarizes the highlights of the findings from the five

case studies. It covers the causes of displacement; labor market conditions

at the time of displacement; measures taken to prevent displacement and

help workers find jobs and maintain income; the characteristics of the displaced workers; their job hunting experiences; and some job effects of

displacement.

In the subsequent sections, each of the cases is described following

the outline indicated above. The analysis points up the relation between

selected personal characteristics (age, education, etc. ) and reemployment

experience. The scope and method of conducting these studies are explained

in Appendix A.

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Summary

This section compares data for the different case studies, to bring

out any consistent patterns or contrasts. Some generalizations have been

made, but it should be noted that the data in the separate case studies have

not been combined statistically.

Factors Influencing Displacement

The experience in attempting to select cases for study of worker

displacement due uniquely to technological change clearly indicates that such

cases are difficult to find. Although technological change was a factor in

each of the five cases studied, it was by no means the sole factor. Along with

an outmoded production process, a change in consumer demand to a product

using a different material, or an old and outmoded plant, other factors such

as the loss of an important industrial customer or a history of labormanagement conflict were involved. In each instance, it was extremely

difficult to determine which factor or factors had a decisive influence on the

ultimate decision to shut the plant or lay off workers.

Labor Market Conditions

The plants were located in six substantially industrialized and highly

diversified areas. The smallest area had a labor force of a little under

50,000; the largest, well over 500,000. Unemployment rates at the time of

the layoffs were in excess of or close to the "relatively substantial unemployment" level of 6 percent in 5 of the 6 areas. Subsequently, conditions improved

and, by the time the surveys were conducted, unemployment had declined

substantially in each of these five areas.

Measures to Prevent Displacement

Layoffs may be prevented or minimized by various means such as:

the use of attrition, i.e . , quits and retirements, to reduce the work force; the

early retirement of older workers; spreading available work by measures

such as the elimination of overtime; and timing the change to take place during

periods of business expansion. Four of the case studies involved plant

shutdowns where none of these means was used. In the fifth case, more than

half of the projected employment reduction was achieved by attrition. No new

employees were hired for over 3 years before the first group of employees

were laid off. The same firm, the oil refinery, also induced older workers

(over age 51), not scheduled for layoff under the seniority regulations, to

retire early by offering them a substantial "age allowance" as a separation

payment in addition to their regular severance pay and to an immediate annuity.

In that case, 1 out of 6 of the displaced workers accepted early retirement and

thereby saved the jobs of a like number of younger workers.

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Measures to Help Displaced Workers Find Jobs

By far the most effective source of assistance in locating jobs appears

to have been personal contacts* From one-half to two-thirds of the displaced

workers responding to this question stated that nfriends or relatives” was the

source responsible for finding their jobs. Relatively few workers credited

the State employment service with locating their jobs. However, employment service records in one case indicate that some workers may have

understated the help given them by the employment service.

The nature and extent of assistance in finding jobs given displaced

workers by their employer varied considerably from case to case, depending on management attitudes, the history of labor-management relationships,

and union contract provisions. In four of the cases, the majority of the

workers were represented by unions affiliated with the American Federation

of Labor and Congress of Industrial Organizations (AFL-CIO); in the fifth case

there was an independent union. Types of assistance used in one or more of

the case studies included: early notice of the impending layoff; placement

services; interplant transfers; retraining programs; and in-plant reassignments and transfers.

Early Notice. One firm ceased new hiring 3 years before the layoffs

began, notified the workers well in advance of termination, and phased out the

layoffs over a period of a year. In all other cases, notice was considerably

shorter. The longest advance notice was 6 months; the shortest, little more

than 2 months.

Placement Services. Substantial and effective assistance in securing

jobs for displaced workers was given in only two cases, in one by the company and in the other by the union. The oil company assisted in placing workers through its own employment office and also entered into an agreement to

pay the placement fees of two private employment agencies. The company

stated that it had assisted one-third of the reemployed workers in locating

their jobs, although one-half of those so placed were no longer working on

those particular jobs at the time of the survey. In another case, that of the

automotive equipment plant, the union invited all displaced members to fill

out a job referral form which was circulated among companies with which it

had contracts. As a result of these efforts, approximately 200 out of more

than 1,000 displaced workers were employed by companies under contract to

the union.

Interplant Transfers. Although all five companies were multiplant

firms, only two offered interplant transfers, in both instances under union

negotiated plans. In neither instance were relocation allowances granted. In

one case, the contract with the major union representing production and

maintenance workers provided that, if the company shut down a plant and

transferred its operation to another plant, the employees would be given an

opportunity to transfer to the other plant with their jobs. They would be

credited with full seniority for layoffs and recall as well as for economic

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benefits such as pensions and vacation. In the second case, the contract

required only the transfer of economic benefits, but no job security benefits. The importance of job security to the displaced workers is indicated

by the fact that a much larger proportion of eligibles accepted transfer in

the first case than in the second, despite the fact that the new plant was

twice as far away. Some effects of these provisions are discussed in the

subsequent section on ’’mobility and reemployment. ”

Employer Retraining Programs. None of the five employers adopted

programs to retrain displaced workers for jobs elsewhere. One company

publicly announced the establishment of a $ 100, 000 retraining fund shortly

after announcing the impending shutdown; but the program was not implemented. About 30 percent of the displaced workers registered for training.

The company reported that for over 70 percent of the registrants, there was

no reasonable prospect for job placement after retraining because of age,

inadequate schooling, or low scores on aptitude tests. It stated that many

were not willing to train for service jobs paying much lower wages than they

had been receiving, and that few were willing to give up unemployment compensation and supplementary unemployment benefits, for which they would

have been disqualified under existing regulations, while engaged in a fulltime training program.

Inplant Reassignments and Transfers. In one instance, where a substantial number of workers were laid off but the plant was not closed, the

persons to be laid off were determined on the basis of plantwide seniority.

This procedure left numerous vacancies which were filled by reassignment,

transfer, and retraining of the employees remaining with the plant.

Measures to Maintain Income

Unemployment Insurance. The most important source of income for

the displaced workers was unemployment insurance. In four cases, the

number receiving such benefits ranged from 69 to 94 percent of the total, for

an average of from 18 to 27 weeks. Even in the fifth case, with relatively

low unemployment at the time of the survey, close to half of the workers

received U .I. benefits.

Supplementary Unemployment Benefits. These benefits had been

negotiated in only one case. By the time of the survey, benefits had been

received by 2 out of 3 of the displaced workers of that company for an average

of 22 weeks.

Severance Pay. Some form of severance pay was obtained by displaced

workers in 4 of the 5 cases, but in only one in sufficient amount to be of substantial assistance in a period of protracted unemployment. The oil refinery

paid a ’’service allowance” based on weekly base pay and length of service.

The lowest amount paid to any of the displaced workers was in excess of $ 600.

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Early Retirement Pay. While the pension program in each case provided for early retirement at age 60 or sooner, in only two cases did more

than a very small proportion of the displaced workers benefit from this

provision. One involved a substantial number of older workers and, in a

period of 14 months after the shutdown was announced, pensions were paid

to 375 workers, 283 of them in the major bargaining unit. The bulk of them

were for early retirement; otherwise, for normal or disability retirement.

It should be noted that, with the payment of these pensions, the pension fund

was not sufficient to cover the vested rights of the younger workers. Under

contract provisions, therefore, deferred pensions were substantially reduced

for those in the 50-59 age group and were wiped out for those under 50. In

the second case, a contributory plan provided immediate or deferred annuities

for those with 10 or more years of service regardless of age. Ninety percent

of the laid-off workers 55 years old and over received immediate annuities

and another 5 percent, deferred annuities. One out of 3 displaced workers

under 55 received immediate or deferred annuities.

In all other cases, many workers with long service who had been

accumulating pension rights lost those rights entirely.

Personal Characteristics of the Displaced Workers

The average displaced worker was a white male in his late forties.

He had some high school education; was married, owned his home, and had

two dependents. Women accounted for 2 out of 5 workers in one case, 1 out

of 5 in another, and insignificant proportions in the others. In no case did

nonwhites exceed 7 percent of the total. While most workers were age 45 or

over, the proportion in this category varied from 21 percent in one case to

94 percent in another. In four of the cases, a majority of the displaced

workers had at least some high school education; in all but one case the

proportion of graduates was relatively small.

Job Hunting Experience

The search for a job was a difficult experience for many displaced

workers. For a large number it was fruitless. Most of the displaced workers had had long years of service in a particular line of work. Many were

ill-prepared for the strenuous efforts of job hunting. The evidence indicates,

however, that most made the effort with the following results:

Employment and Unemployment. Only 2 out of 3 of all 3, 000 displaced

workers in the 5 cases studied were employed at the time of the surveys, and

in the separate cases the proportion ranged from one-half to four-fifths.

One-tenth were retired or for other reasons not seeking employment. Close

to 1 out of 4 were seeking employment but were unemployed. The rate of

unemployment varied from a low of 8 percent in one case to a high of 39 percent in another. In each case, it was substantially higher than the unemployment rate in the labor market area as a whole (ranging from 3 to 5 percent).

In 5 of the 6 areas, it was more than 5 times the area unemployment rate.

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There was substantial long-term unemployment. In four cases,

workers unemployed 16 weeks or more at any time between the layoff and

survey constituted over half of the displaced workers; in two of those cases,

it was two-thirds. In the same four cases, those unemployed a half-year or

more ranged from over two-fifths to more than half.

A substantial proportion of the displaced workers in the surveys had

held no jobs at all from the time of their layoff. A considerable number,

however, ranging from 1 out of 8 to about 3 out of 8, had changed their jobs

and had held 2 or more jobs.

Early Withdrawals from the Labor Force. Sizable numbers of displaced workers, ranging from 9 to 14 percent of the total, indicated they were

no longer seeking employment. Such withdrawals from the labor force represented substantial proportions of workers in the 60-64 age group. It seems

clear that many found themselves compelled to end their careers as wage

earners earlier than they had planned. At best, their withdrawal meant early

retirement with pensions below the amount which would have been due them

at normal retirement and a lower income than had been anticipated. In many

instances, particularly in the case of women, older workers without pensions

withdrew because of their inability to obtain jobs.

Age and Reemployment. Unemployment was markedly higher among

workers of age 45 and over than among younger workers. In two cases,

where finer age breakdowns were feasible, by far the highest unemployment

rates were found in the 55-59 age groups. A substantial proportion of workers in the 60 and over age groups were not seeking work. A considerable

number of these had taken early retirement benefits. Many others may have

been discouraged from looking for work, foreseeing age discrimination.

More displaced workers volunteered comments on the subject of such discrimination than on any other subject in each of the five cases. Most were

workers in their fifties or above; but many were younger.

Education and Reemployment. Displaced workers who had completed

high school had substantially lower unemployment rates than those who did

not--less than half in three cases. The differences in unemployment rates

between those who had no high school and those who had some were smaller.

High school education seemed, from case to case, to have helped

older workers obtain reemployment. In general, among older workers, high

school graduates fared better than nongraduates; and workers with some high

school had lower unemployment rates than those with no high school. Workers not seeking employment were found for the most part among the less

educated. The combined handicap of inadequate education and older age

caused many to withdraw from the labor market before they normally would

have retired.

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Reemployment of Women. The rate of unemployment among women

was almost 3 times that among men in the two cases where meaningful comparisons were possible. Only one-fourth of the displaced women workers

were employed, in both cases. In one, almost 7 out of 8 women, compared

with 1 out of 3 men, had been out of work a half-year or more. In the other

case, the ratio was 2 out of 3 women compared with 1 out of 4 men. Likewise,

displaced women workers in the two cases had a much higher unemployment

rate than men at each educational level and at each age group under 60. A

larger proportion of women than men in the 60-64 age group were not seeking

employment. The impact of discrimination because of age would seem to have

been felt earlier among women than among men. The highest level of unemployment was reached by women at age 45-54, by men at age 55-59.

Skill Level and Reemployment. All case studies reveal a higher

unemployment rate among the less skilled workers. Unemployment ranged

from none to 33 percent among maintenance workers, from 8 to 39 percent

among machine operators, and from 20 to 59 percent among laborers. A

similar pattern was revealed when hourly earnings were used as a rough

measure of skill. In these studies, most of the unemployed were found at the

lowest earnings levels.

Industries Providing Jobs. Very few displaced workers were able to

find jobs in the same industry. In four cases, such workers constituted, at

the most, no more than 1 out of 5 of the total reemployed. In two cases, the

bulk of such placements were due to interplant transfers under union contracts.

Most reemployed workers, except in one of the cases, did secure

jobs in manufacturing industries. However, substantial proportions, ranging

from about 1 out of 4 to almost 3 out of 5, found employment in nonmanufacturing industries (including government).

Mobility and Reemployment. For most workers, it was necessary to

look outside their home area to obtain a job in the same industry. That

willingness to move was a positive factor in obtaining employment is also

indicated by the fact that greater proportions of employed workers than unemployed had sought work outside their home cities.

The two cases involving interplant transfers cast some light on

inducements and obstacles to worker mobility. Only the guarantee of job

protection--the transfer of full seniority rights--was sufficient to induce a

substantial number of displaced workers to undertake relocation. Even in

that case, a large majority of the displaced workers did not accept relocation.

Relatively few workers were willing to transfer with accumulated rights to

pensions, vacation, and other economic benefits, but no seniority on layoffs.

However, the need to conserve rights to pensions and other employee benefits

was one among other inducements to relocate, such as age discrimination

by local employers, and the economic pressures of larger families.

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Obstacles to mobility included: home ownership; family and social

ties; the secondary role in the family of the job of the displaced woman

worker; children in school; uncertainty regarding the company's intentions;

and fears of future layoffs. Another factor impeding mobility was the high

cost of transfer. Apart from costs of relocation, many transferred workers

found it necessary or expedient to maintain two homes and to commute

between areas on weekends, at least in the first year after transfer.

Training and Reemployment. Only a small number of displaced

workers, ranging from 2 to 7 percent, took any training courses, other than

on-the-job, after displacement. Nevertheless, a large majority indicated

that they would be interested in taking a training course if they did not have

to pay for it. Many men were interested in learning special skills such as

welding, electronics, auto mechanics, and machine repair. Women emphasized office and clerical occupations and nursing.

Job Effects of Displacement

Besides long-term unemployment, displaced workers who found jobs

experienced lower earnings, work of lower skill, loss of employee benefits,

and loss of seniority protection.

Effects on Earnings. A majority of those who obtained reemployment

accepted reduced hourly earnings. In each of the five cases, more than half

of the reemployed workers had lower earnings, with the ratio as high as 4 out

of 5 in one case. Moreover, many workers took a substantial decline in

earnings, amounting to at least 20 percent. Those who did so constituted at

least 1 out of every 4 reemployed workers, and in one case were more than

half of the total. In contrast, only small proportions of the reemployed

achieved higher earnings.

Older workers who obtained employment experienced a greater

decline in hourly earnings than younger workers. The proportion of workers

whose earnings had dropped at least 20 percent increased substantially after

age 45. Also, by the same measure, the workers with the least schooling

took the sharpest cuts in wages.

In each case studied, the proportion of wives who were working

increased after the layoff. In most cases, the greater part of the increase

was in part-time rather than full-time jobs.

Effects on Employee Benefits. In their comments on the questionnaire s ,~3IspIaceH~worir^^ complained, often bitterly, of the loss

of employee benefits. This was considered one of the most serious hardships

resulting from worker displacement, since most workers were at least partly

dependent upon such benefits for security to themselves and their families in

old age or in illness. Moreover, many types of benefits are based upon length

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of service and workers obtaining other employment had to start anew in

accumulating rights. Most of the reemployed workers indicated that employee

benefits on their current jobs were less favorable than on their previous jobs.

Changes in Type of Job. As a concomitant of the loss in earnings,

many of the displaced workers experienced a downgrading of skill. This was

truer of semiskilled than of skilled occupations. While in four cases the

change in jobs for a majority of workers in maintenance occupations meant

no change in occupational group, in no case did as many as one-third of the

machine operators obtain jobs in the same occupational group. Substantial

proportions of the operators who were reemployed were working as laborers

or in custodial jobs.

Effect on Union Membership. The layoffs had a serious impact on

membership in labor unions. Prior to displacement, some 9 out of 10 of the

displaced workers were union members. By the time of the surveys,

membership in unions was reduced to no more than 1 out of 3 in two cases

and in no event more than slightly higher than 2 out of 3. The highest proportion of retention of union membership by displaced workers was found among

displaced workers of a plant where substantial numbers were either transferred to another area under union contract or obtained jobs at unionized

plants with the assistance of the union. Part of the decline in union membership was due to the substantial proportion of displaced workers who were

unemployed or not seeking employment at the time of the surveys. However,

even when consideration is limited only to those workers who had found jobs,

the figures still show a substantial drop in union membership, resulting in a

range of membership of from two-fifths to three-fifths of all reemployed

workers. An important reason for this decline is the fact that many of the

new jobs were in unorganized industries or plants, and workers in such jobs

were no longer eligible for membership in the union to which they had

belonged.

Effects on Seniority. Displacement resulted in loss of benefits that

long service conferred on individuals. The large majority of the displaced

workers had over 10 years of seniority. In some plants, substantial proportions had longer service. Workers with at least 20 years of seniority

amounted to 1 out of 4 in one plant, 1 out of 3 in a second, and 7 out of 8 in a

third. The loss of seniority meant the loss of protection in layoffs for

reemployed workers.

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II. A Layoff at a Modernized Petroleum Refinery

A petroleum refinery in the Midwest replaced obsolete with more

efficient equipment. The jobs of 800 workers were terminated during a

14-month period, from September I960 through October 1961. The survey

on which this study is based was conducted in April 1962, from 6 months

to over a year and a half after the terminations.

Description of Plant

The refinery was over 70 years old. The replacement of obsolete

with modern equipment had been proceeding since 1956. For example, a

single 140, 000-barrel-a-day crude oil refining unit which started up in

1959 replaced 10 smaller capacity units and required only 11 percent as

many workers. Altogether, about 1,800 jobs had been eliminated between

early 1958 and October 1961. In March 1962, employment was 5,200.

The plant is located in a highly industrialized metropolitan area.

Manufacturing employment in the area is close to one-half its labor force,

and the bulk of manufacturing employment is in the primary metal industries. During the period of the layoff, the unemployment rate for the area

ranged from 4. 6 to 9. 9 percent, and averaged 7.8 percent. At the time of

the survey, April 1962, the rate was 4.7 percent.

Measures to Ease Displacement

Management took several steps to ease the impact of employment

reductions on the workers. The workers were represented by an independent union.

Attrition. First, all hiring was stopped beginning in m id-1957. Soon

thereafter, staffing reductions were projected and estimates were made of

the number of jobs which would be vacated by quits, deaths, and retirements.

More than half of the 1,800 total reduction was accomplished through attrition. The 800 workers who were to be laid off were informed several

months in advance and were terminated on a scheduled basis.

Seniority System. The workers to be displaced were selected on the basis

of a plantwide seniority system. The company had hired all workers as

laborers, and promoted them to higher level jobs as they were trained.

Workers were chosen for dismissal on the basis of least seniority in the

plant, regardless of the jobs performed. Those remaining were offered

retraining by the company to fill vacated positions. The company set up an

80-hour training course on work time, prepared a 300-page textbook, and

used movies, film strips, demonstrations, and field trips. Several weeks

of on-the-job training were given. No age limit was set on retraining.

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Separation Payments. Close to half of the displaced workers received unemployment insurance benefits. Two forms of severance pay were given by the

company: First, a "service allowance" was computed by multiplying total

years of service, minus 2, by 75 percent of weekly base pay--reduced by

1/84 for each month after the worker’s 58th birthday. A worker under age

58, earning $ 3.00 an hour (close to the average rate), with 12 years of

service, would have received a service allowance of $ 900. The lowest

service allowance actually paid to the workers included in the survey was

a little over $ 600.

Second, a "supplemental age allowance" was paid to workers over

age 51 who voluntarily retired, regardless of their length of service. A

maximum of $ 4,800 was paid at age 58, with the amount gradually scaled

down toward zero at age 51 on the one hand and at age 65 on the other.

For example, a worker voluntarily retiring at age 56 would have been paid

a supplemental age allowance of $ 3,428. If his hourly rate was $ 3. 00 and

his seniority 25 years, he also would have received a service allowance of

$ 2, 070. His total separation pay would have amounted to $ 5,498.

Table 1 shows the distribution of total separation payments received

by the terminated workers, by age groups. The highest separation pay

among the workers surveyed was in excess of $ 8,400. In addition to the

separation payments, participants in the company retirement plan with 10

or more years of service were permitted to take an immediate or a deferred

paid-up annuity, based on both the worker’s and the company's contributions

to the plan. About 1 out of 6 workers under age 55 received immediate

annuities and another 1 out of 6 were eligible for future payments. Ninety

percent of those 55 and over received immediate annuities and another 5

percent were eligible for future annuities.

Placement. The refinery's employment office assisted displaced workers

in locating other employment. About 600 other employers in the area were

contacted. The refinery also contracted to pay the employment fee charged

by two private employment agencies.

Personal Characteristics of the Displaced Workers

All of the workers released by the refinery were men, and nearly

all were of the white race and were married. (See chart 1 and table 2. )

Close to two-fifths were under 35 years of age, and a little more than the

same number were between age 35 and 44. Only one-fifth were 45 years of

age or over.

Nearly three-fifths had 3 or more dependents. Four-fifths of the

total owned their own homes. Over a majority of the workers were high

school graduates or had some college. Very few, mostly older workers,

had no high school education.

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Table 1. Petroleum Refinery--Range of Separation Pay of Displaced Workers and Average

Payment, by Age Group1

Age group

All

displaced

workers

(percent)

Average

separation

pay

Percent of workers receiving--

Total $500-

$999

$ 1,000-

$2,999

$3,000-

$4,999

$5,000-

$6,999

$7,000

and

over

All displaced workers 100 $1,504 100 51 39 2 5 3

Less than 35 y e a r s ......... 37 896 100 67 33 - - --

35-44 years ...................... 42 1„ 000 100 46 54 - -

45-54 years .................... . 10 1,207 100 61 33 6 - -

55 years and o v e r ........... 11 5, 640 100 5 9 14 45 27

1 Separation pay consists of: (1) for all workers, a "service allowance" based on length of

service and weekly base pay; and (2) for workers between age 51 and 65 terminating voluntarily,

a "supplemental age allowance" up to $4,800 at age 58.

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Chart 1. Petroleum Refinery— Personal Characteristics of Displaced W orkers.

26 or MORE 55 or OVER

HIGH SCHOOL

EDUCATION

M ost of the disp laced w ork ers age 45 and over had quit voluntarily, 

m otivated by the com pany1 s separation pay program . Voluntary term in a ­

tions accounted for on e-sixth of all displaced w o r k e r s . The m edian age for 

those who term inated voluntarily was 57; for all the displaced w ork ers, the 

m edian age was 37.

B ecause of the com pany's layoff p roced u re, the sen iority of the d is ­

placed w ork ers was concentrated within a sm all range. T heir low est se n io rity was 9 y ea rs, and 88 percent of the total had between 9 and 15 years of 

seniority. F or the group as a w hole, the m edian sen iority was 13 y ea rs; 

for those w ork ers who term inated voluntarily the m edian was 26 y ea rs.

Job Hunting E xperien ce

E m ploym ent and U nem ploym ent. At the tim e o f the survey, 83 p ercen t of 

the displaced w ork ers w ere em ployed. About 8 percent w ere unem ployed 

and 9 percent w ere not looking for w ork. M ost of the latter had re tire d 

between the tim e of the layoff and the survey.

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Table 2. Petroleum Refinery--Selected Characteristics and Employment

Status of Displaced Workers

C h a ra cteristics

A ll 

d is ­

placed 

wo rkers

E m ploym ent status1

Total E m ­

ployed

U nem ­

ployed

Not

seeking

em ploym ent

P ercen t

Total, all displaced

w o r k e r s ............................ 100 100 83 8 9

Sex:

Male .......................................... 100 100 83 8 9

R ace:

W h ite.......................................... 97 100 83 8 9

O th e r .............. . ......................... 3 100 100

A ge:

L ess than 35 y e a r s .............. 37 100 90 8 2

35-44 years ............................ 42 100 91 9

45-54 years . . . . . . . ............ 10 100 95 5

55 years and over ................. 11 100 23 4 73

Education:

No high s c h o o l.............. .. 8 100 27 73

Some high s c h o o l ............ 13 100 80 4 16

High sch ool g ra d u a te ......... 71 100 90 9 1

At least som e college . . . . 8 100 81 13 6

H ourly earnings level:

Under $ 2 . 7 0 .......................... 11 100 81 19

$ 2 . 70 - $2. 8 9 ....................... 17 100 84 16

$ 2 .9 0 - $ 3 .0 9 ....................... 36 100 89 7 4

$ 3 .1 0 and ove r .................... 36 100 66 7 27

1 At the time of the survey.

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The m a jority had experien ced less than 6 weeks of unem ploym ent. 

(See table 3. ) One out of 5 reported no unem ploym ent, many of this group 

having retired . M ore than 1 out of 4, how ever, had 16 or m ore weeks of 

unem ploym ent and m ore than 1 oui: of 6 reported having been unem ployed as 

long as 6 months and m ore.

Table 3. P etroleum R efin ery --D u ra tion of 

Unemployment

Length of tim e unem ployed1

P ercen t of 

displaced 

w ork ers

T otal2 .......................................................... 100

No days l o s t ................................................... 21

Up to 1 w e e k ................................................... 16

2-5 weeks ........................................................ 19

6-10 weeks ...................................................... 11

11-15 weeks ................................................... 6

16-20 weeks ................................................... 8

21 - 25 w eeks ................................................... 1

26 weeks or m ore ....................................... 18

W o r k e r s included in the sam ple w ere te r m inated over a p eriod of 1 year. The tim e between 

term ination and the survey ranged from about 6 to 

18 m onths, depending on the individual term ination 

date. Length of tim e unem ployed includes all unem ­

ploym ent experien ced between layoff and survey.

2D oes not include w ork ers not seeking 

em ploym ent.

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Age and Education and R eem ploym ent. Since the group was concentrated 

within a narrow range of ages (79 percent under 45) and educational lev els 

(79 percent high sch ool graduates), differen ces in em ploym ent status are 

probably not significant. (See table 2.) N everth eless, the handicaps of 

age and lack of education in seeking em ploym ent w ere the subjects m ost 

frequently m entioned by displaced w ork ers in answ ering the questionnaires. 

The follow ing are som e typical com m ents.

On Age

nI notice that no one likes to em ploy a man if he is older than 

35 yea rs old. M ost w ill not even d iscu ss the situation, not 

even the cou rtesy to talk to a man over 3 5 .ff (Age 38)

,fIndustry does not like to hire m en over 35 years of age and 

in m any ca ses are ju stified. T hese m en w ill have a hard tim e 

com peting with younger m en for other em ploym ent throughout 

the area. n (Age 42)

,!The m ost discouraging experience I'v e had is being told I was 

too old for em ploym ent in field s that requ ired training (on -th ejob training). I was 35 years old at the tim e. " (Age 35)

"M any of m y frien ds who w ere laid off at the sam e tim e and 

who w ere in m y age bracket or their late 3 0 's found it ex ceed ­

ingly difficult to obtain job s because of this fa cto r." (Age 29)

Education

"Y ou m ust have a degree (high school) to get anywhere today. "

(Age 38)

"Y ou have to have at least two yea rs of colleg e for job s which 

don't have anything to do with colleg e w ork. " (Age 33)

"Industry demands a tlea st a high sch ool diplom a now ." (Age 39)

"E m p loy ers seem to want young colleg e m en with experien ce. "

(Age 38)

"W hile job hunting, it becam e apparent to m e that knowing 

a craft or having m ore than a high sch ool education is a 

m u s t." (Age 31)

Skill L evel and R eem ploym ent. The rate of unem ploym ent am ong unskilled 

w ork ers was con sid erab ly higher than among other groups. (See table 4 .)

O ver half had been em ployed in only 1 job since leaving the refin ery .

C lose to one-fourth had two job s and about on e-sixth had 3 or m ore jo b s.

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Table 4. Petroleum Refinery--Em ploym ent of D isplaced W orkers Before and After Term ination, by Occupation

Employment status at survey date (percent)

Employed in present job a s- -

Occupation at refinery Total Unemployed M ainte - 

nance 

w orker1

O perator

Technician or 

in sp ector

Unskilled

w orker2

T ruckdriver

G overnment

w orker3

Sales

or

clerical

w orker

Selfemployed

worker

Maintenance w orker1 ............. 100 52 11 5 11 ~ - 5 11 5

O p e r a t o r ......................................... 100 8 8 16 6 31 2 i l 10 8

T e c h n ic ia n o r in s p e c t o r . . . 100 5 -- 5 29 28 -- 14 14 5

U n sk ille d w o r k e r 2 . ............. .. . 100 20 9 6 -- 48 -- 11 3 3

T ru c k d riv e r................................. 100 6 6 6 11 39 6 11 16

1 In c lu d es a ll m ain ten an ce m e c h a n ic s.

2 In c lu d es l a b o r e r s , h e l p e r s , and c u sto d ial w o r k e r s .

3 P r i m a r i l y f i r e m e n , p o lice m en , and p o stm e n .

Note: Because of rounding, sums of individual items may not add to 100.

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One out of 5 displaced w ork ers cla ssifie d as unskilled w ere unem ployed at 

the tim e of the survey. M aintenance w ork ers, the m ost skilled, on the 

other hand, rep orted no unem ploym ent.

C onsidering relative earnings as a rough m easure of skill, it is 

clea r that the two low est paid groups (under $ 2. 70 and $ 2. 7 0 -$ 2. 89) had 

m ore than double the unem ploym ent rate experienced by the two higher 

paid groups of w ork ers (table 2).

Industries P rovidin g J o b s . N early tw o-thirds of the em ployed w ork ers 

found job s in m anufacturing industries but only 7 percent w ere reem ployed 

by the oil refin ery industry. (See table 5 .) About half of those who found 

job s in m anufacturing industries w ere reem ployed in the steel industry, the 

dominant industry in the labor m arket area. M ost of the rem aining third of 

all w ork ers finding new job s w ere em ployed in various nonm anufacturing 

industries; som e w ere em ployed by governm ent, m ainly loca l governm ent; 

six percent w ere self-em p loyed .

Table 5. P etroleum R e fin e ry --T y p e s of Industries 

P roviding Current Jobs1

Industry P ercen t of 

w ork ers

T otal, all em ployed w o r k e r s .............. 100

M a n u fa ctu rin g................................................... 64

Steel products ............................................ 31

C hem ical products ......................... .. 7

Oil r e fin in g ................................................... 7

Cleaning products ..................................... 5

F ood products .......................... 3

Othe r ............................................................... 11

Nonm anufacturing .......................................... 18

Finance and insurance ............................ 4

C o n stru ctio n ................................................. 3

R e t a il.................................. ........................... 3

Other ............................................................... 8

G o v e rn m e n t........................................................ 12

L oca l governm ent (p olice, firem en ,

e tc .) .......................................................... 8

P ost o ffice ............ ............... ...................... 4

S e lf-e m p lo y e d ................ .................................. 6

xJobs held at tim e of the survey.

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A ssistan ce in Finding J o b s. The m ost frequent source of job leads, cited 

by over half of the people surveyed, was ''frien d s and re la tiv e s ." Next 

m ost com m on w ere "new spaper ads, " m entioned by over tw o-fifths of the 

group; "oth er com panies w here applied for jo b s " (nearly tw o-fifth s); the 

"State em ploym ent s e rv ic e " (alm ost a third); and the "r e fin e r y 's job p la ce ­

m ent s e r v ic e " (also alm ost a third). P rivate em ploym ent agen cies retained 

by the refin ery w ere nam ed by n early a fourth.

Slightly over half of those responding also nam ed "frien d s or r e la ­

tives, " as the source which actually located their jo b s . H ow ever, "oth er 

com panies w here applied for jo b s" was named by 12 percent; new spaper 

ads, by 8 percent; the re fin e ry 's job placem ent serv ice or private em p loym ent agencies retained by the refin ery by 6 percent; other private em p loy ­

m ent agen cies, by 2 percent; the State em ploym ent serv ice by 1 percent, 

and the union by 1 percent. N early a fifth (18 percent) claim ed they got the 

job "on their own. "

The answ ers to this section of the questionnaire frequently did not 

agree with other inform ation collected . About half of the m en filed claim s 

for unem ploym ent com pensation with the State em ploym ent se rv ice . N early 

a fourth of these w ere given job re fe rr a ls , and over on e-th ird of those r e ­

fe rre d found job s with the firm to which they w ere sent. Yet virtually none 

of these cred ited the agency with having located their job for them .

The refin ery officia ls estim ated that, excluding em ployees who left 

voluntarily under the severance pay arrangem ents, the com pany a ssisted 

in locating job s for on e-th ird of the w ork ers. Inform ation on job re fe rra ls 

by the com pany com p ares v ery clo s e ly with the w o rk e r's place of em p loym ent (as shown on the questionnaire). H ow ever, a great many w ork ers did 

not seem to be aware of the part played by the com pany in helping them get 

jo b s. Only half of the m en whom the com pany a ssisted in locating jo b s, 

how ever, w ere still w orking at those particular job s at the tim e of the survey. 

Those who had left did so either because they had been laid off or had secu red 

better positions elsew h ere.

M obility and R eem ploym ent. The displaced w ork ers w ere asked whether 

they had looked for w ork beyond the loca l area. F rom their resp on ses, it 

appears that, com paring those who obtained job s and those who did not, 

about equal p roportion s sought w ork outside their hom e city. H ow ever,

1 out of 7 of the reem p loyed w ork ers had looked for w ork further than 50 

m iles away; none of those who w ere unem ployed had done this.

Training and R eem ploym ent. About 1 out of 10 w ork ers rep orted that ea rlier 

training given by the com pany for job s in the refin ery helped them subsequently 

in getting job s outside.

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About a fifth of the w ork ers reported that they had had job training 

since leaving the refin ery. In about tw o-thirds of these ca se s, the training 

was on the job . In the rem aining ca ses, the training was generally obtained 

in private sch ools and paid fo r by the w ork ers. A ll w ork ers who had received 

form a l job training either at the refin ery or at sch ools w ere em ployed at the 

tim e of the survey.

C lose to nine-tenths of the displaced w ork ers said they would be 

interested in taking a training cou rse if they did not have to pay for it.

T h ree-fou rth s said they w ere interested in training for a better job . Of those 

interested in training, 21 percent d esired a cou rse in e le ctro n ics. Other 

interests w ere e le ctrica l training (10 percen t), laboratory resea rch (6 p e r ­

cent), welding (5 percen t), and engineering (4 percen t).

Some Job E ffects of D isplacem ent

D isplaced w ork ers who w ere em ployed at the tim e of the survey, 

reported lo ss e s in earnings on their present jobs com pared to their job at 

the refin ery and, in gen eral, som e downgrading in skill lev els.

E ffect on E arnings. Four out of 5 reem ployed w ork ers w ere earning less 

at the tim e of the survey than at the refin ery. (See table 6 .) C lose to onetenth w ere earning about the same wages and a little m ore than one-tenth 

had higher earnings. F or approxim ately 1 out of 3, the drop in earnings 

was at least 20 percen t.

M ost sharply affected w ere those who had been in the higher earnings 

ca teg ories. W ell over half (58 percent) of the w ork ers who had been earning 

$ 3.10 an hour or m ore suffered a decline of at least 20 percent com pared 

with 8 percent in the low est paid group, under $ 2. 70 per hour. Only 8 p e r ­

cent of the highest paid group achieved higher earnings, com pared with 31 

percent in the low est paid group.

A number of w ork ers com m ented on the lo ss of fringe benefits 

because of displacem ent. T ypical com m ents w ere:

"I lost a great deal in old age pension and vacation. These 

are im portant to m e and m y fam ily. M (Age 40)

,fMy only regrets at leaving w ere giving up or losing m y 

vacation of three weeks for 14 years of se rv ice , m y fringe 

benefits. I liked the retirem ent plan on which I paid part, 

the stock plan. Things in that line w ere a lot better than 

I have now. ,! (Age 41)

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Table 6. P etroleum R efin ery--C h an ge in Earnings L evel

P ercen t on current job r e c e iv in g --

H ourly earnings 

lev el at refin ery T otal At

least

30%

le ss

2 0 .0 - 

29. 9% 

le ss

1 0 .0 -

19.9%

le s s

Up to 

9.9% 

le ss

Same

earnings1

Higher

earnings

A ll em ployed 

w o r k e r s .......... 100 7 25 24 23 9 12

Under $ 2 . 7 0 ............ 100 8 8 38 15 31

$ 2 . 70 - $ 2. 8 9 ____ 100 14 29 29 9 19

$ 2 .9 0 - $ 3 . 0 9 ____ 100 6 20 35 23 10 6

$ 3. 10 and over . . . . 100 14 44 14 14 6 8

W ith in 5£ either way.

Som e w ives of d isplaced w ork ers apparently adjusted to the change 

by seeking outside em ploym ent. B efore the layoff, the w ives of 25 percen t 

of the displaced w ork ers w ere em ployed. The proportion of w ives w orking 

had in crea sed to 29 percent, at the tim e of the survey; the in crea se was 

m ainly in p art-tim e w ork, with little change in the proportion obtaining fu lltim e w ork.

Changes in Type of J ob . D isplaced w ork ers in general had to take job s at 

low er sk ills. (See table 4 .) Even among the m aintenance w ork ers, only 

half w ere em ployed at the sam e skill le v e ls. The ’'op era tor11 and the "te c h ­

nician or in sp ector" groups showed sizable proportions taking job s in the 

unskilled w orker category.

In com paring their current job with their jo b at the refin ery , the 

large m a jority con sid ered the current job w orse in term s of both w ages and 

fringe benefits. In 3 other aspects of the jo b --s u p e rv is io n , type of w ork, 

and travel to w ork --th e general b elief was that there had been an im p rov em ent. The respondents generally felt that there had been little change in 

hours of w ork and p rosp ects of prom otion.

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III. A C losed Autom otive Equipment Plant

A M idwest autom otive equipment plant was closed in June 1962, 

displacing approxim ately 1, 100 em ployees. The operations and equipment 

of the plant w ere tra n sferred to an existing plant about 150 m iles away, in 

an adjacent State, and to a new plant in the South. The com pany also had 

several plants located in a number of other a rea s. The survey was conducted 

in A p ril 1963, 10 m onths after the plant shutdown.

D escription of Plant

At the tim e of the shutdown, the plant had been in existence m ore 

than 40 y ea rs. The com pany had lost its principal cu stom er, a m ajor 

autom obile m anufacturer which had decided to produce its own equipment.

The resu lt was a significant change in the nature of operations at the plant, 

from lon g-ru n for a single cu stom er, to sh ort-ru n operations for m any 

cu stom ers. The lo ss o f business had caused the com pany to clo se two other 

plants in the sam e area at ea rlier dates. The plant closin g, in June 1962, 

was p reced ed by long con flict between the com pany and the union over p r o ­

posed m easu res to achieve econ om ies.

The plant was loca ted in a highly industrialized area, w hich has a 

labor fo rce of clo se to 200,000. M anufacturing w ork ers in the area account 

for about 1 out of 3 w ork ers in nonagricultural em ploym ent. P rin cip al m anufacturing industries providing em ploym ent are transportation equipm ent; 

stone, clay, and glass products; fabricated m etal products; and e le ctrica l 

m achinery.

The area was cla ss ifie d by the U .S . Departm ent of Labor as one of 

rela tively substantial unem ploym ent at the tim e of the plant closin g. The 

unem ploym ent rate of 6. 8 percent, how ever, had declined from 9. 3 percent 

a year e a rlie r. The decline continued, with the unem ploym ent rate dropping 

to 4. 9 percent in A p ril 1963, the month of the survey, when the area was 

cla ss ifie d as one o f only m oderate unem ploym ent.

M easures to E ase D isplacem ent

The bulk of the plant1 s production and m aintenance w ork ers w ere 

represented by an industrial labor union. Som e skilled w ork ers w ere 

organized by a cra ft union. Both unions w ere affiliated with the A F L -C IO .

Interplant T ra n sfe rs. The contract between the com pany and the industrial 

union had provided for interplant tra n sfers of m em b ers of the bargaining 

unit. If the com pany shut down a plant and tra n sferred its operations to 

another plant, the em ployees would be given the opportunity to transfer to 

the other plant with their jo b s. While w orking on the tra n sferred job , such 

em ployees would be cred ited with full sen iority for layoff and re ca ll as w ell 

as for econom ic benefits, such as vacation pay, pensions, etc.

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If the com pany shut down a plant and did not tran sfer operations to 

another plant, em ployees w ere to be given the right to tran sfer to other 

plants covered by the m aster agreem ent b efore new w ork ers w ere hired by 

such plants. Although transferring w ork ers would start as new em ployees, 

they would ca rry seniority with them for purposes of econ om ic benefits.

A pproxim ately 800 jobs w ere tra n sferred to a plant in another State 

after the closing of the subject plant. In M arch 1962, 3 months b efore the 

plant closin g, the w ork ers w ere advised by plant bulletin to sign a requ estto-tra n sfer form . Some 230 w ork ers w ere, at their own request, tra n sfe rre d with their jobs to the other plant and retained full sen iority on those 

jo b s. A few other w ork ers tra n sferred to various plants of the com pany as 

new h ires except fo r retention of seniority for econ om ic ben efits. Total 

tra n sferees num bered about 265. The contract between the com pany and the 

craft union did not provide for interplant tra n sfers, and m em b ers of that 

bargaining unit do not appear to have been given the opportunity to make 

such tra n sfers.

Company E fforts. The com pany announced the im pending shutdown of the 

plant 6 months in advance of the closin g. The com pany subsequently c ir c u ­

lated inform ation about the skills of the displaced w ork ers among the industries in the area of the plant shutdown. It m et with a com m ittee of real estate 

people in the area to which the operations w ere tra n sferred and secu red their 

agreem ent not to raise rents a rb itra rily . It also publicly announced the establishm ent of a $100, 000 retraining fund in F ebruary 1962, but the training p r o ­

gram was never actually put into effect. A total of 322 em p loyees, in a ratio 

of 3 m en to 1 wom an, reg istered for training. The average age of the m en 

was 52, and of the wom en 49. Both m en and wom en had average schooling 

of a little over ninth grade. The com pany reported that for m ore than 70 

percent of the registrants there was no reasonable p rosp ect for job placement after retraining because of age, inadequate sch ooling, or low sco re s 

on aptitude tests. It stated that many w ere not w illing to take training cou rses 

for serv ice jobs paying much low er wages than they had been receiv in g , and 

few w ere w illing to give up unem ploym ent com pensation and supplem entary 

unem ploym ent benefits for which they would have been disqualified under 

existing regulations while engaged in a fu ll-tim e training p rogra m .

Union E fforts. The union representing the large m a jority of the w ork ers 

sought to a ssist its displaced m em bers in finding reem ploym ent. It invited 

all displaced m em bers to fill out job re fe rra l fo rm s, d escribin g their p e r ­

sonal ch a ra cte ristics, qualifications, education, and em ploym ent h istory.

The form s w ere then circulated among com panies with which the union had 

con tracts. A s a result of those efforts, approxim ately 200 w ork ers w ere 

em ployed by com panies under contract with the union. The la rg est p r o p o r ­

tion of these w ere hired by one firm which was expanding and which accepted 

displaced w ork ers up to age 55. Union representatives explain the w illingness 

of this com pany to hire older w ork ers on the ground that it d esired ’’instant 

sk ills, " trained w ork ers who could adapt to new job s with a m inim um of 

retraining.

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A pparently, the union was not able to place wom en w ork ers readily. 

Union representatives stated that m en at 55 and over and wom en at any age 

w ere hardest hit by failure to find jo b s. The union representatives said that 

they could place skilled trade sm en --m illw rig h ts, m achinists, electricia n s - - 

at any age, with little difficulty.

Unem ploym ent Insuran ce. At the tim e of the survey, about 7 out of 10 of 

the displaced w ork ers had receiv ed som e unem ploym ent insurance benefits 

(table 7). The average duration of those benefits was 21 w eeks.

Separation P aym en ts. Under the union contract, displaced w ork ers w ere 

entitled to three types of separation paym ents: supplem entary unem ploym ent benefits; d eferred severance pay; and pensions. Supplem entary 

unem ploym ent benefits, provided for under union contract and paid co n cu rrently with unem ploym ent com pensation, had been obtained by tw o-thirds of 

the displaced w ork ers, for an average duration of 22 weeks by the tim e of 

the survey (table 7).

Table 7. A utom otive Equipment P lant--U nem ploym ent Insurance and 

Supplem entary Unem ployment Benefits

P eriod benefit receiv ed U .I.

(P ercent)

S .U . B.

(Percent)

T otal1 ...................................................................................... 100 100

R eceiving benefits ................................................................... 69 67

F or 1-10 weeks ................................................................... 17 19

F or 11-20 weeks ................................................................. 8 12

F or 21-30 weeks ................................................................. 43 35

F or 31 or m ore w eeks ...................................................... 1 1

Not receivin g b e n e fit s ............................................................. 31 33

A verage number of w eeks benefit r e c e iv e d ................... (21) (22)

xDoes not include w ork ers not seeking em ploym ent.

The S .U .B . p rovision in the contract also provided for lum p-sum 

separation paym ents to be receiv ed 1 year after involuntary term ination by 

w ork ers not eligible for norm al or ea rly retirem ent pensions. F or m ost of 

the displaced w ork ers, the due date for receivin g paym ents was July 1963.

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The amount for each w orker was com puted by a form ula involving his base 

hourly rate, plant seniority, and the state of the trust fund. This sum was 

reduced by any benefits p reviou sly paid under the S .U . B. p rogram . F or 

exam ple, if the trust fund had been fully funded, a w orker with a $ 2. 50 

base hourly rate and 25 years of serv ice (average seniority was greater) 

would have been entitled to a lum p-sum payment of $2, 782. 50 m inus S.U . B. 

paym ents. H ow ever, the amount of the payment was reduced by 35 percent 

because the fund had been substantially depleted 3 years ea rlier when sep a ­

ration pay benefits w ere given to over 1,000 em ployees of another plant 

closed by the com pany.

Between M arch 1962 and M ay 1963 pensions hAd been paid to 375 

w ork ers, 283 of them in the m a jor bargaining unit. T h ree-fou rth s of the 

pensioners w ere m en. O ne-sixth of the total obtained norm al retirem ent 

benefits, half as m any receiv ed disability pensions, and the r e s t --m o r e 

than 3 out of 4 p e n sio n e rs--to o k early retirem ent benefits. In a ccord an ce 

with con tract p rov ision s, the heavy drain on the pension fund requ ired the 

parties to reduce d eferred pensions to a little m ore than 40 percent of the 

amounts cred ited to w ork ers age 50-59 and to allot no d eferred pensions to 

w ork ers under 50. This caused con siderable bittern ess, som e of it directed 

at the union as w ell as at the com pany, among displaced w ork ers who lost 

their pension rights.

P erson a l C h a ra cteristics of the D isplaced W ork ers

About 4 out of 5 of the displaced w ork ers w ere m en. (See chart 2 

and table 8 .) The proportion of wom en em ployed by the com pany had declined 

because of reductions of the w ork fo r c e . A ll the term inated w ork ers w ere of 

the white ra ce. A ccord in g to union represen tatives, about 100 N egroes had 

been hired during W orld War II and up to 195 2; but, because of low er seniority, 

none was left after previous reductions in fo r c e .

V ery few w ork ers w ere under age 45 when the plant was clo se d .

M ore than half w ere between 45 and 54 years of age, and the rem ainder 

w ere 55 and ov er. This high age level was the resu lt of the ’’bum ping11 of 

w ork ers with le ss seniority in the cou rse of a num ber of ea rlier w ork fo rce 

con traction s. A s a resu lt, alm ost 7 out of 8 had 26 or m ore y ea rs of 

sen iority when displaced.

A lm ost on e-th ird of the w ork ers w ere high sch ool graduates. An 

equal proportion had attended high school but had not graduated. A little 

m ore than a third had no high sch ool education at all.

M ost of the w ork ers w ere m a rried . Only 5 percent w ere single and 

10 percent widow ed or divorced. H ow ever, 24 percent had no dependents and 

a la rg er proportion had 1 dependent. F ew er than 40 percent had 2 or m ore 

dependents.

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Chart 2. Autom otive Equipm ent P lant— Personal Characteristics of D isplaced Workers.

DEPENDENTS

UNDER 16

Job Hunting E xperien ce

E m ploym ent and U nem ploym ent. Ten months after the final layoff, only 

3 out of 5 of the disp laced w ork ers w ere em ployed. (See table 8 .) This 

included w ork ers tra n sferred to other plants of the com pany. M ore than 

one-fourth w ere unem ployed, and about 1 out of 7 was not seeking w ork.

P rim a rily as a result of the sizable num ber of w ork ers who tra n sfe rre d to another plant of the com pany in accord a n ce with the union a g re e ­

m ent, 1 out of 5 displaced w orker s lost no tim e through unem ploym ent. 

About on e-th ird lost le ss than 5 w eeks. On the other hand, m ore than 2 

out of 5 w ork ers w ere out of w ork a h a lf-yea r or m o re . Over half w ere 

unem ployed 16 weeks or m ore. (See chart 3 .)

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Table 8. A utom otive Equipment P la n t--S elected C h a ra cteristics and 

E m ploym ent Status of D isplaced W ork ers

C h a ra cteristics

A ll

displaced

w orkers

E m ploym ent status1

T otal E m ­

ployed

U nem ­

ployed

Not seeking 

em ploym ent

P ercen t

Total, all w ork ers . . . 100 100 59 27 14

Sex:

M a l e ................................... 79 100 67 20 13

F e m a le ............................... 21 100 26 56 18

R ace:

White ................................. 100 100 59 27 14

A ge:

L ess than 35 years . . . 3 100 63 10 27

35 - 44 y e a r s ................. 3 100 89 11 0

45 - 54 y e a r s ................. 53 100 67 29 4

55 yea rs and over . . . . 41 100 44 29 27

Education:

No high sch ool .............. 36 100 46 35 19

Some high s c h o o l.......... 32 100 58 33 9

High sch ool graduates . 32 100 73 15 12

H ourly earnings lev el:

Under $ 2 . 5 0 ................... 21 100 36 45 19

$ 2. 50 - $ 2. 89 .............. 31 100 57 31 12

$2. 90 - $3. 2 9 .............. 25 100 64 22 14

$ 3 .3 0 - $ 3 . 6 9 .............. 18 100 78 13 9

$ 3. 70 and o v e r .............. 5 100 81 8 11

lAt tim e of survey.

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Chart 3. Automotive Equipm ent Plant — Long-Term

Unemployed as Percent of Total Displaced Workers

PERCENT

90

8 0

7 0

6 0

40

30

2 0

I 0

DURATION OF UNEMPLOYMENT

V ?,

16 weeks or more

26 weeks or more

T O T A L MEN WOMEN

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Over half of the displaced w ork ers had held only one job since 

term ination. A lm ost a tenth had had 2 jo b s. R elatively few had w orked 

for m ore than 2 em p loyers.

The effects of unem ploym ent on the m ora le of the displaced w orker 

w ere su ccin ctly stated in the follow ing com m ent by a 4 9 -y e a r-o ld man: nI

get the sam e answer everyday. ’ Com e back la te r’ . I am asham ed of m y ­

self. I hate to com e hom e. ”

Age and R eem ploym ent. Age was cle a rly related to unem ploym ent. Only 

a very sm all proportion w ere under 45 years of age. R elatively few in this 

group w ere unem ployed and seeking w ork, only 1 out of 10 (table 9).

In the 45-54 age group, the unem ployed w ere about 3 out of 10. 

Am ong those who w ere 55-59, they accounted for 3 out of 8. F rom age 

60 on, the unem ploym ent rate declined, but m ore than half w ere no longer 

seeking em ploym ent. This reflects in part the sizable num ber of early 

retirem ents m entioned e a rlie r. It also re fle cts the feelings of h op elessn ess 

ex p ressed by a num ber of older displaced w ork ers, fo r exam ple:

’’The minute they see that I am over fifty they turn m e 

d ow n .” (Age 56)

’’There is m uch talk about discrim in atin g against the co lo re d 

ra ce, but. . .1 am convinced that there is m ore discrim in ation 

against the aged group. ” (Age 54)

’’L ife expectancy is longer now than it ever w as. M y grandfather lived to be 90, m y fa th er-in -la w is 80 and still going 

along. I have 20 to 30 years to look forw ard to doing nothing. "

(Age 60)

” 1 am 48 and I don’t think I should be con sid ered old. ”

’’M ine, like a lot of people, is age, plus no education. . . .

Now, m achines are taking job s that people h a d .” (Age 56)

” At m y age of 55, it is alm ost im p ossib le to obtain a jo b .

It was only through the help of the union that som e in our 

group w ere able to obtain em p loym en t.”

Education and R eem ploym ent. A significantly higher p roportion of high 

school graduates (73 percent) had em ploym ent than w ork ers who had not 

graduated high sch ool (58 percent), or those had not attended high sch ool 

(46 p ercent). (See table 9.) The unem ploym ent rate was rela tively low 

am ong high sch ool graduates,(14 percent), com p ared with the w ork ers in 

each of the other groups (33 percent or m o re ). A la rg er proportion of 

those with no high sch ool education w ere not seeking em ploym ent than 

those with higher lev els of education.

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T ab le 9. A utom otive E quipm en t P la n t--E m p lo y m e n t of D isp la ce d W o rk ers by A ge

G roup and E d u cation al L e v e l1

Age group

Percent

All

displaced

workers

Employment status2

All

workers

Employed

Unemployed

Not seeking

employment

All workers

All age groups .................. 100 100 58 28 14

Less than 35 years . .............. 3 100 60 11 29

35 - 44 years ....................... 3 100 89 11 0

45 - 54 years....................... 53 100 67 29 4

55 - 59 years......... .. 25 100 58 37 5

60 - 64 years......... .. 15 100 27 19 54

65 years and over.............. 1 100 0 14 86

No high school

All age groups.................. 100 100 46 36 18

Less than 35 y e a r s................ _ _ _ _

35 - 44 years........... .. 1 100 100 0 0

45 - 54 years . . . . . . . . . . . 40 100 58 38 4

55 - 59 years . . . . . . . . . . . 33 100 44 49 7

60 - 64 years................ 24 100 33 16 51

65 years and over ....... 2 100 0 0 100

Some high school

A ll age groups.................. 100 100 58 33 9

Less than 35 y e a rs ........... .. . _ _ _ _ _

35 - 44 years ....................... 2 100 50 50 0

45 - 54 years........... .. 62 100 62 33 5

55 - 59 years ....................... 23 100 67 31 2

60 - 64 years........... 12 100 28 30 42

65 years and over.............. 1 100 o 40 60

High school graduates

All age groups.................. 100 100 73 14 13

Less than 35 years ................ 8 100 61 11 28

35 - 44 years....................... 8 100 100 0 0

45 - 54 years.................. 57 100 80 16 4

55 - 59 years....................... 19 100 75 20 5

60 - 64 years........... .. 8 100 7 10 83

65 years and over.............. — — — —

xA ge group and edu cation al le v e l at term in atio n .

2At tim e of su rv ey .

N ote: D iffe re n c e s betw een ta b le s 8 and 9 a r e due to ex clu sio n of q u estio n ­

n a ir e s that did not contain data fo r both ag e and education.

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Although high school education helped the older w ork ers in obtaining 

em ploym ent, the unem ploym ent rate in crea sed with age among the m ore 

educated as w ell as among those with le ss ed u ca tion --from 16 percent at 

age 45-54 to 20 percent at age 55-59 for high sch ool graduates, com pared 

with an in crea se from 38 percent to 49 percent for those with no high school 

training. The follow ing are com m ents by displaced w ork ers on the im p o rtance of education:

’’Education is so im portant now if you want to w ork. ” (Age 56)

” 1 think education is the key today for su ccess, also w ork 

opportunities. M y education was lim ited to high sch ool, and 

with m y present position I fear m y advancem ent m ight be 

ham pered because of t h is .” (Age 36)

R eem ploym ent of W om en. One of the m ost striking findings of the study 

was the difficulty wom en had in finding reem ploym ent. W ell over half of 

the wom en w ere out of w ork as com pared with on e-fifth of the m en. With 

the inclusion of those not seeking em ploym ent, a total of th ree-fou rth s of 

the wom en did not have jo b s. Chart 3 shows that 5 out of 6 wom en w ere 

unem ployed at least a h a lf-y ea r, com pared with 1 out of 3 m en. It it also 

notable that v ery few wom en who had been unem ployed for 16 w eeks or 

longer had secu red jo b s.

F u rth erm ore, the lev el of unem ploym ent am ong wom en was co n ­

siderably higher than among m en at all ages and all education le v e ls. (See 

chart 4 and tables 10 and 11.) High sch ool graduation, how ever, appears 

to have been an aid in securing reem ploym ent am ong both sexes. While no 

w om en sp e cifica lly charged discrim in ation because of sex in their c o m ­

m ents on the questionnaires, a num ber com plained about age discrim in ation 

at age lev els below those at which m en com plained. Chart 4 shows a peak 

unem ploym ent rate of 67 percent among wom en in the 45-54 age group. The 

highest unem ploym ent rate among m en was reached between ages 55 and 59 

and was alm ost double the rate in the 45-59 age group.

Skill L evel and U nem ploym ent. Table 12 presents occupations before and 

after displacem ent. The table excludes data for approxim ately on e-fifth of 

the w ork ers tra n sferred to other plants of the com pany under the union 

agreem ent. Since m ost of these em ployees w ere tra n sferred with their 

jo b s, their inclusion would have tended to obscu re what had happened to the 

other em ployees. The table also shows separate data for certain occu p a ­

tions by sex because of the extrem ely large proportion of wom en who had 

not obtained jo b s. Am ong the 4 w om en's occupations shown, all but the 

one involving c le r ic a l em ployees show at least 4 out of 5 unem ployed.

F or m ale w ork ers, unem ploym ent was highest am ong the unskilled 

la b o re rs, 3 out of 5. C lose to half of the m en rem ained unem ployed who 

had been in sem isk illed occupations as a ssem b lers and in sp ectors. Men 

who w ere m achine op era tors, who appear to have been cla ss ifie d higher 

than sem isk illed at the equipment plant, had a m uch low er proportion of

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Chart 4. Automotive Equipment Plant-Unemployment by--

Sex, Education, and Age Group

ED UCATIO N 

NO H IG H SCH O O L

SO M E H IG H SCH O O L

H IG H SCH O O L G RADU ATE

PERCENT OF DISPLACED WORKERS

20 30 40 50 60 70

T

AG E GROUPS 

U NDER 35

35-44

45-54

55-59

PERCENT OF DISPLACED WORKERS

0 10 20 30 40 50 60 70 80

U NDER 35

35-44

45-54

55-59

i ! iii hi liirn

liitHiHUSKlIlii

WOMEN

I

M I 111.1.1111Jill]j i i l 1 1 1 .1 m mm

u in i n L iiiiiLMM1:1.11 . i. & ii. JJlL li.

_____ i_____ i_____ i_____ i_____ i_____ i_____ i_____

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Table 10. Autom otive Equipment P lan t--E m p loym en t Status of D isplaced

W orkers by Sex and Age G roup1

Percent

Age group All Employment status2

displaced

workers

All

workers

EmployedUnemployed

Not seeking

employment

Men

All age groups . . . . 100 100 67 21 12

Less than 35 years . . . 2 100 84 5 11

35 - 44 years........... 3 100 93 7 0

45 - 54 years........... 51 100 79 17 4

55 - 59 years........... 26 100 65 32 3

60 - 64 years........... 16 100 30 20 50

65 years and over . . 2 100 0 14 86

Women

All age groups . . . . 100 100 25 57 18

Less than 35 years . . . 4 100 11 22 67

35 - 44 years ..... . 4 100 75 25 0

45 - 54 years........... 59 100 27 67 6

55 - 59 years ...... 23 100 23 62 15

60 - 64 years........... 10 100 9 13 78

65 years and over . .

xAge group at termination.

2At time of survey.

Note: Differences between tables 8 and 10 are due to exclusion of

questionnaires that did not contain data for both sex and age.

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Table 11. Autom otive Equipm ent P lan t--E m ploym en t Status of D isplaced

W ork ers by Sex and Educational L e v e l1

Educational level

Percent

All

displaced

workers

Employment status2

All

workers

Employed

Unemployed

Not seeking

employment

Men

All educational

le v e ls ........... .. . . . 100 100 67 21 12

No high school................ 34 100 56 26 18

Some high sch oo l......... 33 100 66 25 9

High school graduates . 33 100 79 11 10

Women

All educational

levels .................... 100 100 25 57 18

No high school................ 43 100 15 67 18

Some high sch o o l......... 33 100 28 64 8

High school graduates . 24 100 39 31 30

Educational level at termination.

2At time of survey.

Note: Differences between tables 8 and 11 are due to exclusion of

questionnaires that did not contain data for both sex and education.

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Table 12. Automotive Equipment Plant--Employment Before and After Termination, by Occupation (excludes transferred workers)

O ccupation at 

closed plant Sex

Percentage d is ­

trib u tio n 

at closed 

plant

Employment status at survey date ( percent)

A ll

workers

Unemployed

Employed In present job as- -

Machine

operator

Assemb le rInspector

Maintenance

worker

Tool

and

d ie

maker

Machini s t

Laborer

Custod ia l

worker

Shipp in g -

stock

worker

C le r ica l

worker

Sales

worker

Superv is o rD raftsman

P rofession al

worker

Other

Machine op erator ......... M 22 100 30 27 4 3 1 __ _ _ 9 10 2 - - 4 1 - - - - 9

F 3 100 90 - - - - -- - - “ “ 5 5 - “

""

Assembler ......................... M 11 100 45 8 10 4 - - - - 6 4 - - — 5 2 - 2 14

F 16 100 79 1 1 2 - - - - - - 2 5 10

In sp ector ......................... M 7 100 47 13 - - 18 3 - - — - 7 6 - - - - - 6

F 3 ICO 84 - - ” ”

Id

Maintenance worker . . . M 6 100 26 - 2 -

58 - - - 2 - - - - - - - - 2 5 5

Set-up ............................... M 3 100 24 - 32 8 - - - 8 12 4 — - - - - - - - 12

Tool and d ie maker . . . M 4 100 12 - - - - 76 12 - - - - - - - - - - - — --

M achinist ......................... M 3 100 12 4 - - - - 84 - - - - - - — — - - - - —

Laborer ............................. M 5 100 59 5 - - 11 - - - - - 15 5 5 - - - - - - --

Shippin g-stock /, 17

worker ........................... M 3 100 42 8 4 17 - - 8

C le r ic a l worker ........... M 3 100 24 - - - - 10 - - - - - - - - - - - 33 - - ~ — - - 33

F 1 100 12 - - - - -- “ “ “ “ ~ - " - 76 12 ""

Supervisor ...................... M 3 100 17 4 4 - 4 - - - 9 4 - 9 ~ 31 - — 18

Draftsman ........................ M 3 ICO 8 - - - - - - - - - - - - - - - - - - - 84 4 4

P rofession al worker .. M 2 100 - - - -- - - 8 - - - - - - - - - - - 92

C t h e r ................................. K ? ICC 76 8 - - ■- *■* 8 8

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Considering relative earnings as a rough measure of skill, workers

earning the lowest pay at the automotive equipment plant, under $ 2. 50 per

hour, experienced the highest unemployment, 45 percent (table 8). Unemployment was lower for successively higher wage groups and amounted to

only 8 percent in the group earning $3. 70 and over per hour.

Industries Providing Jobs. Three-fourths of the reemployed workers had

obtained jobs in other manufacturing plants--almost half in the automotive

equipment industry, and another one-tenth in the automobile industry

(table 13). Seventeen percent were working in nonmanufacturing industries, and 6 percent in government, mostly local government jobs. A

small proportion were self-employed.

unem ploym ent. Unem ploym ent was still low er for m en in the m ore skilled

jo b s, such as m aintenance and set-up man and was low est for those who

had held the highly skilled job s of m achinist and tool and die m aker.

Table 13. Automotive Equipment Plant--Types of Industries Providing

Current Jobs1

Industry

Percent of employed workers

Including

transferred

workers

Not including

transferred

workers

Total, all employed w orkers............... 100 100

Manufacturing................................................... 75 62

Automotive equipment............................... 47 21

Automobile..................................................... 11 17

Steel products.............................................. 6 8

Other................................................................ 11 16

Nonmanufacturing............................................ 17 25

Engineering firms ...................................... 2 3

Hospitals ....................................................... 2 3

Service stations .......................................... 1 2

Other .............................................................. 12 17

Government....................................................... 6 10

Federal............................................................ (2) 1

State ................................................................ 1 1

County.............................................................. 1 1

Municipal....................................................... 4 7

Self-employed................................................... 2 3

^obs held at time of survey.

2Less than 0. 5 percent.

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After exclusion of the transferred workers who constituted one-third

of the reemployed workers, over three-fifths were found employed in manufacturing industries--with one-fifth in automotive equipment plants, and close

to that proportion in the automobile industry. Nonmanufacturing industries,

then, accounted for one-fourth of the reemployed, and government for onetenth.

Assistance in Finding Jobs. The principal sources of job leads, cited by

over half of the respondents, were the State employment service and friends

or relatives. Others were the union, newspaper ads, and direct application.

However, the principal source cited as actually locating present job was

friends or relatives, cited in almost half the cases; the second most important source was the union which was credited with locating the jobs of 1 out

of 4 of the reemployed workers; other sources were named by much smaller

proportions of workers.

Mobility and Reemployment. About 2 out of 3 displaced workers stated that

they had limited their job search to their home city. A greater proportion

of the unemployed had thus limited themselves than had the employed workers,

and a much smaller ratio of unemployed to employed had extended their search

for jobs more than 50 miles beyond home.

The sizable number of displaced workers who obtained jobs with the

same company in other areas provides an opportunity to make a special study

of the characteristics of these transferees and to compare them with the

employees who had not left the area. As indicated earlier, the union contract permitted all workers whose actual jobs were moved to another plant

to move with their jobs and retain all their seniority as long as they worked

at those jobs. All others had transfer rights to any plants covered by the

union’ s master agreement and would retain seniority only for purposes of

employee benefits, such as vacation pay, pension, etc.

The workers who chose to move with their jobs amounted to some

30 percent of the number eligible and 20 percent of all displaced workers.

They constituted by far the greater number of all transferred employees.

Chart 5 presents a comparison of certain characteristics of the transferring

workers with those of all displaced workers.

Only 7 percent of the transferring workers were women, compared

with 21 percent of all displaced worker s (table 14). The overriding influence

would seem to be the fact that in most cases husbands were working in the

home area.

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too

90

80

70

60

50

40

30

20

to

0

39

5. Automotive Equipment Plant - Comparison of Selecte

MEN MARRIED OWN

HOME

TWO OR

MORE

DEPENDENTS

AGE GROUP

55-59

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Table 14. A utom otive Equipment P la n t--S elected C h a ra cteristics of 

W ork ers Who T ra n sferred to Other Plants of the Company C om pared

With A ll D isplaced W ork ers

Percent

Characteristics T ransferred

workers

All displaced

workers

All w orkers................................................. 100 100

Sex:

M a le ................................................................ 93 79

Fem ale............................................................ 7 21

Age:

Less than 35 y e a rs ................................... 1 3

35 - 44 years .............................................. 2 3

45 - 54 years .............................................. 51 53

55 - 59 years .............................................. 38 25

60 - 64 years .............................................. 8 15

Education:

No high school ............................................ 29 36

Some high school........................................ 38 32

High school graduate ................................. 33 32

Marital status:

M arried......................................................... 85 85

Single.............................................................. 2 5

Other .............................................................. 13 10

Dependents:

N one................................................................ 15 24

i ....................................................................... 33 38

2 ....................................................................... 22 18

3 ....................................................................... 17 11

4 or more ..................................................... 13 9

Home ownership:

Own or buying home ................................. 74 84

Renting home .............................................. 26 16

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A comparison by age reveals slightly fewer transferees below 55,

a considerably greater proportion in the 55-59 age group, and fewer at age

60 and over. The fact that 38 percent of the transferred workers were age

55-59 indicates that fear of unemployability at that age level and unwillingness to lose pension benefits were compelling factors. Two typical

comments:

nIt seemed advisable and practical, considering age,

experience, etc. , to go with the job. The move has been

disturbing to family life. . . . However, to protect pension

rights, insurance, and other benefits, I intend to stay with

the company. n (Age 58)

!,I came with my work in order to save pension rights. M (Age 56)

While there was not much difference in marital status, the transferees as a group had more dependents than other workers. On the question of home ownership, 3 out of 4 of those who responded were homeowners,

a smaller ratio than for the entire group of displaced workers, about 5 out

of 6 of whom were homeowners.

That a great deal of hardship was involved in the transfer is shown

by the fact that by far the majority of those who stated that they owned their

homes owned homes in the closed plant area. This meant: (l) for many,

weekly commuting the 150 miles between the two areas; and (2) the burden

of maintaining two homes. A number of workers commented on this, for

example:

nI own my home in / the closed plant areaJ and we drive back

andJEorth each weekend. . . . We rent an apartment in /the job

area./ and pay $80.00 a month rent.”

MI have to travel each weekend and. . . rent an apartment and

live apart from my family, which does not make for happiness. ”

,!The big thing is I canTt be at home with my family where

I belong, and the added expense of traveling and keeping two

homes. M

A wife: ”I!m only in / the job area/ every other week with

my husband and we haven’t been apart for 35 years. ”

Influences inducing transferred workers to keep their homes in the

closed plant area included fear that the new jobs would be eliminated, age

of the transferees and nearness of retirement, close family and social ties,

children in school, and similar factors. As time passes, more of them may

sell their homes and put down some roots in the job area. Others may rent

their old homes in the expectation of returning to them after retirement.

Nevertheless, the costs of transfer--economic, personal, and social--were

high.

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These costs indicate some of the reasons why so many displaced

workers did not take advantage of the favorable terms of transfer that had

been negotiated for them. The following are statements by the workers

who had chosen not to transfer with their jobs:

nI could have went to /the job area/ with the company, but I

didn't want to sell out and go there and get stuck. They aren't

too sure how long they will be there. ,r

"The reason I didn't go with the company is I don’t think they

will be there a couple of years and start moving somewhere

else, or they will sell the business. Another thing is I own

a new home and if I would sell it here and buy there, I

would lose my shirt."

"We were told if we wanted to go to sign up. We would have

had to sell everything and start over again. It is not easy

for people to give up what they took a long time to get

together. . . . Many went and quit, as it was impossible to

keep two places. "

Some of the transferred workers complained that the company and

the workers were not being treated equally by the tax laws. They stated

that the company could write off the costs of its move, while the workers

received no deductions for their heavy transfer costs. Some examples:

"Why aren't we allowed to write our moving expenses off

on taxes the same as the company?"

"If my expenses were deductible from income taxes, we

would be better off. "

"If a company makes a move. . . does said company have to

bear cost of moving or is this cost charged off in some

manner against their taxes? If a salaried employee transfers with the company, the cost of moving for said salaried

help is paid for by the company. But if an hourly worker

goes along with the company, he must bear his own cost of

moving. "

Training and Reemployment. About 6 percent of the displaced workers

reported having taken training courses since leaving the automotive equipment plant. Only a little more than 2 out of 5 workers stated that they

would be interested in taking training if it were offered without cost to them.

This group comprised roughly one-third of the employed workers and twothirds of the unemployed.

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The type of training desired covered a wide variety of occupational

fields. Among those more frequently mentioned were welding, machinist,

tool and die, office and clerical, machine operation, and electrician. Some

displaced workers attested to the importance of training in obtaining reemployment:

nIn the smaller shops you have to be experienced in reading

blueprints and set up your own machine. I do not have enough

training in this field to qualify. fr (Age 51)

nI think if a person can read a blueprint thoroughly, age

doesn’t matter much in getting employment. M (Age 51)

”1 was selected for this position not only due to my past

experience in drafting, but also my background in electronics

which I secured by home study. n (Age 5 2)

As noted earlier, the company publicly announced a $ 100, 000 retraining fund at the time of the shutdown, but later said that the age, educational

level, or aptitude scores of most of the displaced workers made them ineligible for retraining. Various workers commented bitterly, feeling the

original offer had not been sincere. One stated: nI feel that the company,

in announcing a retraining program and then abandoning it, has harmed our

chances of employment in this area. "

Some Job Effects of Displacement

Effects on Earnings. Close to three-fifths of all employed workers, including transferred workers, were earning lower hourly pay than at the automotive

equipment plant. (See table 15.) For half of this group, the drop in pay was

at least 20 percent. Only 1 out of 10 reemployed workers received higher

earnings. A sizable proportion (almost one-third) were employed at the same

earnings levels, due largely to the interplant transfers.

Workers who had been in the lowest pay category at the automotive

equipment plant, under $2.50 per hour, experienced the greatest decrease

in earnings. More than one-third of this group experienced a decrease in

pay of at least 30 percent. On the other hand, the highest paid group, $3. 70

and over, had the largest proportion of workers with increased earnings.

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Table 15. Automotive Equipment Plant--Change in Earnings Level

Percent on current job receiving--

Hourly earnings

level at closed

plant

Total At

least

30%

less

20. 0-

29. 9%

less

10.0-

19.9%

less

Up to

9.9%

less

Same

earnings1

Higher

earnings

All employed

workers ......... 100 17 12 16 13 32 10

Under $2.50 ........... 100 36 11 8 12 24 9

$2. 50 - $2. 8 9 ......... 100 14 9 11 9 47 10

$2. 90 - $3. 29......... 100 18 8 23 14 29 8

$3. 30 - $3. 6 9 ......... 100 11 21 14 22 21 11

$ 3. 70 and over . . . . 100 12 7 26 2 30 23

Within 5£ either way.

Chart 6 presents the change in earnings of reemployed workers by

age and education. In the oldest age group, 55 years and over, a greater

proportion of workers earned 20 percent less pay and a smaller proportion

had increased earnings than workers in the 45-54 age group. Both of these

age groups fared worse than the relatively few workers in the two lower age

groups. A considerably higher proportion of high school graduates than

nongraduates increased their earnings. About an equal proportion of workers

with no high school and workers with some high school had experienced a

drop in earnings, but the percentage decline in earnings was smaller for the

group which had had some high school.

A number of the workers felt deeply about the loss of employee

benefits, particularly the loss of pension rights, upon displacement, for

example:

"I think the company should compensate all those people under

50 years old who are unable to claim pension rights. n (Age 44)

nI worked for the company for 27-1/2 years. Yet I will not

receive my pension, and the company can start the same

cycle again with a new set of employees. M (Age 49)

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nThe thing Ifm very bitter about is, I lost all my insurance,

and I get no pension, and I will receive only a small percent

of my severance pay.11 (Age 49)

In some families, about 10 percent of the total adjustment to the loss

of income took the form of a previously nonworking wife (or husband) obtaining employment--mainly part-time work for spouses in the case of the reemployed workers and full-time work for spouses of the unemployed workers.

Chart 6. Automotive Equipment Plant-Change in Earnings of

Reemployed Workers, By Age and Education

PERCENT LOWER EARNINGS

100 80 60 40 20 0

---------------1---------------- 1----------------1— 1

__________ 1___________ 1___________ 1_____ _____1___________

TOTAL

AVERAGES

PERCENT SAME OR HIGHER EARNINGS

0 20 40 60 80

100 80 60 40 20

100 80 60 40 20

AGE GROUP

UNDER 35

35-44

45-54

55 AND OVER

EDUCATION

NO HIGH SCHOOL

SO M E H IGH SCHOOL

HIGH SCHOOL GRADUATE

0 20 40 60 80 “i-------r

At least 20 % lower earnings

Less than 20 % lower earnings

Same earnings

Higher earnings

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Changes in Type of Job. Professionals, draftsmen, and skilled workers,

such as tool and die makers, machinists, and maintenance workers, seemed

to have had little difficulty in securing jobs in their specialties. (See

table 12.) In other occupations, however, even among clerical workers and

supervisors, relatively small proportions were reemployed in the same occupations. In the largest group, the lesser skilled machine operators, close to

1 out of 5 of the reemployed were working as laborers or in custodial jobs.

In comparing their current jobs with their jobs at the automotive

equipment plant, a majority of the reemployed workers reported their

present job as less favorable in wages and fringe benefits. They were about

equally divided in evaluating the type of work. More than 4 out of 5 thought

the new job was better or the same in terms of supervision. About one-third

or more felt that, in terms of travel to work, hours of work, and prospects

for promotion, the current jobs were worse. No more than one-fourth found

any improvement in these three items.

Effects on Union Membership. Before displacement, 94 percent of the

workers surveyed were union members. This proportion had declined to

69 percent at the time of the survey. It may be noted that membership was

maintained by the bulk of the displaced workers who had remained unemployed

or were not seeking jobs--almost 80 percent of each group. Despite the admitted help of the union in securing jobs for a sizable number of the reemployed workers, little more than 60 percent were members of a union at the

time of the survey. This may have been partly due to employment of many

in nonunionized plants or industries.

Effects on Seniority. As noted earlier, close to 7 out of 8 displaced workers

had had at least 26 years of seniority at the closed plant. This seniority

which had meant protection against layoffs, was totally lost except for the

1 out of 5 displaced workers who transferred with their jobs to another city

150 miles away. Seniority also conferred certain economic benefits, such

as longer vacations and pension rights, and these also were lost by all but

those who transferred to other plants of the company. The significance of

the loss of seniority is indicated in the following comment by a 47-year old

man who had had 27 years of seniority at the closed plant:

’’Work at / a second shop/ May 1962 to March 1963. Laid off.

Reason, less than one year of seniority.”

Other comments were:

”1 feel strongly that a man has as much right to his full

seniority as the investors of money have to their money. ”

”1 also think that some kind of laws should be passed that,

when a person spends practically a lifetime on one job, he

should not be thrown out on the street with no protection or

security for his family because a company decides to move

their plant out of town. ”

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IY. Partial Closing of a Glass Jar Plant

A plant located in the Midwest closed its glass jar and a small paper

box manufacturing operations in March 1962, displacing approximately 600

workers. Both production and clerical workers were included in the layoff.

About 800 other workers continued to be employed at the plant in its other

activities, including a zinc rolling mill, a metal products division, the

company1 s laboratories, and its main offices. The company has a number

of other plants in different areas of the country and various subsidiary firms.

It has continued to manufacture glass products in some of the plants. The

survey on which this study is based was conducted in November 1962, 8

months after the March 1962 layoff.

Description of the Plant

The plant was about 75 years old. In announcing the closing of the

glass and paper box operations to the employees in January 1962, the company stated that it nis a high cost plant, with a low productivity, and that it

cannot compete with more efficient operations throughout the industry. n Two

of the company's other glass jar manufacturing plants were newly constructed

and had more modern equipment. In the opinion of a union representative, the

move was motivated more by a desire to obtain lower wage rates and fringe

benefit costs.

The labor market in which the plant is located is a highly industrialized area with a labor force of close to 50,000. Manufacturing accounts for

45 percent of all nonagricultural employment of the area. The majority of

manufacturing employment is in the durable goods industries, and the largest

industry is automotive equipment and parts. Other important manufacturing

industries include electrical machinery, primary metal products, and food

and kindred products. The glass manufacturing plant was the second largest

employer in the area a little over a half-year prior to the shutdown of the

glass operations. A half-year after the shutdown, it was still the sixth

largest employer.

At the time of the layoff, March 1962, the unemployment rate was

7.5 percent, and the labor market area was designated by the Department of

Labor as one of substantial unemployment. That rate, however, represented

a decline of more than 4 percentage points from a year earlier. Unemployment continued to drop and the rate stood at 5. 1 percent in November 1962,

the month of the survey. The extent of the decline appears to have been

largely seasonal, as the rate rose to 6.9 percent by March 1963. Despite

the loss of 600 jobs at the company, total manufacturing employment in the

area rose slightly between January and November 1962. Total nonagricultural employment increased by 4 percent.

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Measures to Ease Displacement

The employees were informed of the closing of the glass jar and

paper box operations on January 12, 1962, a little more than 2 months

before the shutdown on March 19, 1962. Within the 2-month period, operations were gradually decreased until the date of the closing. The majority

of the workers were represented by one union, and some specialized crafts,

by two others. All three unions were AFL-CIO affiliates.

Pension Benefits. The workers were covered by group insurance

and by pension plans provided for in the three union contracts, and a salaried

workers1 plan. A few who had reached retirement age received their

pensions. Early retirement at reduced rates was provided for in all three

union contracts and in the plan for salaried employees. One contract,

covering 7 5 percent of the displaced workers, permitted early retirement

at age 60 with 15 years of service; the other contracts, at age 55. A vested

right in a delayed pension was provided for by the plan for workers represented by the largest of the unions and by the salaried workers1 plan.

Separation Payments. Displaced employees who had been employed

any time in 1962 obtained separation pay. It was based on length of service

and hourly rate. The amounts paid ranged from $ 160 to $ 690. A few older

employees who were ineligible for retirement benefits received $ 900.

Unemployment Compensation. About three-fourths of the displaced

workers received unemployment insurance benefits for an average of 18

weeks. One-third were paid benefits for 21 weeks or more. These figures

should be interpreted conservatively since the survey was conducted only 8

months after the plant closing, and a number of workers had not yet exhausted

their unemployment insurance.

Placement of Displaced Workers. A firm which took over the closed

box department of the glass jar plant had hired about 30 of the displaced

workers at the time of the survey. Despite the subject company's policy of

hiring only former employees for its metal operations in the area, it appears

from the employment information contained in the questionnaires that only a

small proportion of the displaced workers were transferred to those operations or were employed by any of the company's plants located in other areas.

The company temporarily hired a retired personnel officer to assist

displaced workers by writing resumes, talking with other personnel people

in the area, and arranging interviews. Also, before the shutdown, it allowed

workers time off for interviews with representatives of the State employment

service.

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Personal Characteristics of the Displaced Workers

The ratio of men to women among the displaced workers was roughly

3 to Z; nearly all were white. (See chart 7 and table 16.) The median age

at termination was 49. One-third were between age 45 and 54, and nearly

as many were older; only one-tenth were under 35.

Four out of 5 were married; most of the remainder were divorced or

widowed. A sizable proportion (3 out of 10) had no dependents, and almost

as many had only one dependent. Three-fourths owned their own homes.

Four out of 10 workers had had no high school education. A slightly smaller

proportion had gone to school above the elementary level but had not graduated from high school. A little less than one-fourth were high school

graduates.

Plant seniority averaged 18 years. Only 1 out of 8 had fewer than 11

years' seniority. Almost 1 out of 3 had at least 21 years of seniority.

Chart 7. G lass Jar P la n t-P e rso n a l Characteristics of Displaced Workers.

NUMBER OF

DEPENDENTS

SENIORITY-YEARS

UNDER-35

HIGH SCHOOL

EDUCATION

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Table 16, Glass Jar Plant--Selected Characteristics and Employment

Status of Displaced Workers

Characteristics

All

dis -

placed

workers

Employment status1

Total2 Employed

Unemployed

Not

seeking

employment

Percent

Total, all workers . . . . 100 100 50 39 n

Sex:

Male .. 58 100 67 23 10

F em ale......... .. 42 100 27 61 12

Race:

White .................................. 93 100 51 39 10

Other .................................. 7 100 40 40 19

Age:

Dess than 35 years . . . . . 11 100 72 24 4

35 - 44 years.................... 26 100 59 39 2

45 - 54 years . . . . . . . . . . 34 100 55 40 5

55 years and over........... 29 100 28 44 28

Education:

No high school........... .. 40 100 37 46 17

Some high sch oo l........... 37 100 53 41 6

High school graduate . . . 23 100 63 32 5

Hourly earnings level:

Under $ 1.90........... ........... 37 100 29 61 10

$ 1.90 - $2. 29 . ................ 24 100 53 33 14

$2.30 - $2. 6 9 .................. 17 100 60 30 10

$ 2. 70 and o v e r ............. .. 22 100 70 22 8

1

2

At time of the survey.

Because of rounding, sums of individual items may not equal 100.

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Job Hunting Experience

Employment and Unemployment. The search for employment was a

difficult experience for most of the displaced workers; for many it was

fruitless. At the time of the survey, only one-half of the displaced workers

were employed. Close to two-fifths were unemployed, and the remaining

tenth were not seeking work. (See table 16. )

The result of the layoff was not only a high level of unemployment

but also unemployment of substantial duration. More than 2 out of 5 of the

displaced workers were out of work a half-year or more. Three out of 5

experienced at least 16 weeks of unemployment. (See chart 8. ) Fewer than

1 out of 10 lost no time at all; and fewer than 1 out of 4 lost less than 6 weeks

of work. These figures do not include data covering retiring employees,

most of whom collected a number of weeks of unemployment compensation

before retiring.

Two out of 5 displaced workers had held no jobs at all by the time of

the survey. Close to half had had one job. One out of 6 had had two or more

jobs.

Reemployment of Women. There was a marked difference between

the success of male workers and female workers in obtaining employment.

Two out of 3 men were employed compared with little more than 1 out of 4

women. As many as three-fifths of the women workers were unemployed,

and the remainder were not seeking work. (See table 16. )

This contrast in the employment experiences of men and women is

highlighted by the data on duration of unemployment (chart 8). Twenty-three

percent of the men and 70 percent of the women were unemployed at least a

half year. On the other hand, 36 percent of the men and only 4 percent of the

women had less than 6 weeks of unemployment.

While unemployment among men was heaviest in the older age groups,

age 55 and over, and among those with the least education (no high school

training at all), women experienced heavy unemployment in all age groups

and at all educational levels. (See tables 17 and 18 and chart 9.)

Age and Reemployment. The rate of employment declined in each

successive age group (table 19). Unemployment increased from 24 percent

of those under age 35 to 60 percent of workers age 55-59. The majority of

the workers in the 60-64 age group stated that they were not looking for work.

In the case of men, age appears to have become an important factor

in obtaining employment in the late fifties (table 17 and chart 9). The rate of

unemployment rose from one-fifth to one-half between age group 45-54 and

age 55-59. The rate of unemployment of women was high at all ages but rose

to a level of 70 percent as early as age 45-54.

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PER*

9 0

8 0

7 0

6 0

5 0

4 0

3 0

20

I 0

0

52

8. Glass Jar Plant— Long-Term Unemployed as Pe

of Total Displaced Workers

DURATION OF UNEMPLOYMENT

16 weeks or more

26 weeks or more

TOTAL MEN WOMEN

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Table 17. G lass Jar P lant--E m ploym en t Status of D isplaced W ork ers,

by Sex and Age G roup1

Percent

Ag

All

displaced

workers

Employment status

All

wo rk -

ers

Employed

Unemployed

Not

seeking

employment

Men

All age groups . .

Less than 35 years .

35 - 44 years . . . .

45 - 54 years . . . .

55 - 59 years . . . .

60 - 64 years . . . .

65 years and over

All age groups 100 100 26 63 11

Less than 35 years .

35 - 44 years . . . .

45 - 54 years . . . .

55 - 59 years . . . .

60 - 64 years . . . .

65 years and over

7 100

25 100

38 100

16 100

13 100

1 100

37

35

26

24

9

0

58

63

70

71

35

33

5

2

4

5

56

67

1 Age group at termination.

Note: Differences between tables 16 and 17 are due to exclusion of

questionnaires that did not contain data for both sex and age.

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Table 18. G lass Jar P lan t--E m ploym en t Status of D isplaced W ork ers,

by Sex and Educational L ev el1

Educational level

P ercen t

A ll

d is ­

placed

w ork ers

Em ploym ent status

A ll

w ork ­

ers

E m ­

ployed

Unem ­

ployed

Not

seeking

em ploym ent

Men

A ll educational lev els . . . 100 100 66 24 10

No high sch ool .......................... 42 100 50 32 18

Some high sch ool ..................... 33 100 73 23 4

High sch ool graduate and

h i g h e r ................................... . 25 100 85 11 4

W om en

A ll educational levels . . . 100 100 26 63 11

No high s c h o o l ..................... .. . 38 100 19 65 16

Some high s c h o o l..................... 42 100 33 59 8

High sch ool graduate and

higher ..................................... 20 100 27 65 8

1 Educational lev el at term ination.

Note: D ifferen ces between tables 16 and 18 are due to exclu sion of 

questionnaires that did not contain data fo r both sex and education.

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Chart 9. Glass Jar Plant— Unemployment by--

Sex, Age, and Education

AG E GROUPS 

UNDER 35

35-44

45-54

55-59

PERCENT OF DISPLACED WORKERS

0 10 20 30 40 50 60 70 80

UNDER 35

35-44

45-54

55-59

PERCENT OF D ISPLA C ED W ORKERS

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Table 19. G lass Ja r Plant--Em ploym ent Status of D isplaced W orkers, by

Educational Level and Age Group1

A ge group

P ercen t

A ll

d isp la ced

w o rk e rs

E m p lo y m e n t S ta tu s 1 2

A ll

w o rk e rs

E m ­

ployed

U nem ­

p loyed

Not seeking 

em ploym en t

A ll w o rk e rs

A l l a ge g r o u p s ........................... 100 100 49 40 11

L e ss than 35 y e a r s ........................ 11 100 72 24 4

35 - 44 y e a r s ................................ 27 100 58 40 2

45 - 54 y e a r s ................................ 34 100 53 43 4

55 - 59 y e a r s ................................ 14 100 38 60 2

60 - 64 y e a r s ................................ 12 100 16 30 54

65 y ea rs and o v e r ..................... 2 100 8 25 67

No high s c h o o l2

A l l a g e g r o u p s ........................... 100 100 38 45 17

L e ss than 35 y e a r s ........................ 5 100 83 17 0

35 - 44 y e a r s ................................ 15 100 48 46 6

45 - 54 y e a r s ................................ 32 100 46 47 7

55 - 59 y e a r s ................................ 24 100 32 64 4

60 - 64 y e a r s ................................ 20 100 15 29 56

65 y e a rs and o v e r ..................... 4 100 11 33 56

Som e high s c h o o l2

A l l a ge g r o u p s ........................... 100 100 54 40 6

L e ss than 35 y e a r s ........................ 12 100 62 35 3

35 - 44 y e a r s ................................ 30 100 60 40 0

45 - 54 y e a r s ................................ 40 100 53 43 4

55 - 59 y e a r s ................................ 10 100 55 45 0

60 - 64 y e a r s ................................ 7 100 25 31 44

65 yea rs and o v e r ..................... 1 100 0 0 100

High sch ool graduate and h ig h er2

A ll age g r o u p ............................. 100 100 64 31 5

L e s s than 35 y e a r s ........................ 22 100 76 17 7

35 - 44 y e a r s ................................ 41 100 65 33 2

45 - 54 y e a r s ................................ 28 100 68 32 0

55 - 59 y e a r s ................................ 5 100 29 71 0

60 - 64 y e a r s ..................... .. 4 100 0 33 67

65 y ea rs and o v e r ..................... 0

1 A ge and e d u c a tio n a l le v e l at t e r m in a t io n .

2 A t tim e of s u r v e y .

N ote: D iffe r e n c e s betw een ta b le s 16 and 19 a r e due to e x c lu sio n of

question n aires which did not contain data for both age and education.

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About 1 out of 3 respondents to the w ritten questionnaire volunteered 

com m ents coverin g a broad range of su bjects, the m ost frequent of which 

was the com plaint against age b a rrie rs encountered in the path of reem p loy ­

m ent, The follow ing are som e typical com m ents:

"A ll applications rejected because of age and sex. M (Age 58)

MToo old to get a job any place else and not old enough to draw 

m y socia l secu rity. 11 (Age 58)

"I am now alm ost 42 years old and they don't seem to want to 

hire a p erson after they reach the age of 40. 11 (Age 42)

MAt m y age, they don't want you in fa cto rie s. I would be w illing 

to take a training cou rse in anything that m y schooling and age 

would let m e. " (Age 49)

"E m p loyers should be urged to hire old er em ployees as long as 

they are capable. We have to live also and don't have a chance. 11 

(Age 58)

"At 60, one is as old as one feels and to think that all I am good 

for at this span of life is to be a 'baby sitter' is not a good fe e ling for on e's m orale and m ental state. " (Age 60)

Education and R eem ploym ent. In gen eral, those who had attained 

higher educational lev els found reem ploym ent m ore easily. (See table 19.) 

Thus, 2 out of 3 high sch ool graduates w ere em ployed, com pared with a 

little m ore than half of those who had som e high sch ool education but did not 

graduate and 2 out of 5 w ork ers who had no high sch ool training. G reater 

education helped older w ork ers in finding reem ploym ent (except for high 

sch ool graduates age 55-59 where the sm all num ber involved does not perm it 

valid interpretation).

High school graduation was im portant for the m en, and all but a few 

of the m ale graduates w ere reem ployed (table 18). In contrast, only half of 

the m en with no high sch ool education w ere w orking. In the case of the 

w om en, educational level appeared to make little differen ce in securing job s. 

(See chart 9. )

The follow ing are com m ents on the educational b a rrier:

"W hen you are past 35 years old and haven't graduated from high 

sch ool, no one wants you. " (Age 49)

"I have found during m y 7 months of unem ploym ent that all 

m anufacturers require a high school education before they even 

con sider hiring. " (Age 62)

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Skill L evel and R eem ploym ent. In view of the fact that w ork ers at 

the g la ss ja r plant w ere paid under an incentive system , there was probably 

le ss d irect relationship between hourly earnings and individual skill levels 

than would exist if hourly rates w ere paid. N everth eless, the contrast in 

reem ploym ent experien ces between the higher and low er skilled w ork ers 

should be and is broadly indicated by a com p arison between the highest and 

low est earning lev els (table 16). C lose to tw o-fifth s of the w ork ers earned 

le ss than $ 1.90 an hour at the glass ja r plant; and a little m ore than on efifth earned $ Z.70 or ov er an hour. Only 29 percen t of the low est paid 

group w ere em ployed at the tim e of the survey, while 70 percent of the 

highest paid w ork ers w ere em ployed.

An occupational analysis reveals a high lev el of unem ploym ent in 

unskilled and sem isk illed production jo b s , such as la b o re rs, m achine o p e r ­

a tors, and p a ck ers, with unem ploym ent rates from 36 to 71 p ercen t. (See 

table 2 0 .) In contrast, unem ploym ent was relatively low among displaced 

m aintenance w ork ers and su p erv isors.

The follow ing two statem ents by disp laced ja r plant w ork ers are a 

com m entary on this situation:

f,I found there w ere no job s available fo r general labor or se m iskilled w ork ers. n (Age 28)

"I found there are skilled job s just waiting fo r the asking. ,r 

(Age 30)

Industries P roviding J ob s. Of those who had obtained em ploym ent, 

only about half w ere w orking in m anufacturing in d u stries. (See table 21.)

The la rg est group among th ese, constituting 21 percen t of all reem ployed 

w ork ers, w ere em ployed in the glass industry, alm ost all of them in other 

glass com panies located in other a rea s. A con siderab ly sm a ller p roportion 

had secu red job s in the m anufacture of corrugated con tain ers, with the firm 

which had taken over the subject com pany1 s paper box operation s. Only 6 

percen t of all reem ployed w ork ers w ere em ployed in the dominant auto and 

auto parts industry. The rest w ere scattered among sev era l different m anufacturing in dustries.

About 1 out of 3 of the total w ere em ployed in nonmanufacturing industr ie s , including construction, h osp itals, retail trade, d om estic s e rv ic e , and 

m any oth ers. Of the rem aining em ployed w o rk e rs, m ost w ere w orking in 

governm ent a ctiv ities, p rim a rily at a State college and the m unicipal public 

sch ools; and the rest w ere self em ployed.

A ssista n ce in Finding J o b s. The sou rces m ost w idely used in seeking 

jo b s , each cited by m ore than half of the w ork ers, w ere the State em p loy ­

ment se rv ice and frien ds or rela tiv es. A substantial number also stated that

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T able 20. G lass Jar P la n t--E m p loy m en t B efore and A fter T erm in ation , by O ccupation

P e r -

E m ploym en t status at su rvey date (percent)

centage

d is tr ibution

at

closed

plant

E m p loyed in presen t job as

O ccu p ation at 

clo s e d plant A ll

w o r k ­

ers

U n em ­

ployed O p e rator

M ainte - 

nance 

w o rk e r

L a b o re r S u p erv is o r

C le r ical

w o rk e r

A s s e m ­

bly or 

packing 

w ork er

C u stodial

w ork er

D o m e s ­

tic or 

re sta u - 

rant 

w ork er

Other

O p era tor o r m ach ine 

a tte n d a n t...................... 20 100 39 28 3 12 _ 5 2 9

. . 2

M aintenance w o r k e r . 17 100 11 14 51 11 5 5 1 2 - - - -

L a b o r e r . . . * ................... 17 100 36 10 10 21 - - 4 - - 19 - - - -

S u p erv isor . . . . . . . . . 5 100 7 3 7 7 59 11 3 - - 3

C le r ic a l w o r k e r .... 5 100 44 4 - - 4 40 4 4 - - - -

P a c k i n g w o r k e r . * . . 33 100 71 1 - - l1) - - 4 9 - - 13 2

In sp ector . . . » ................ 3 100 58 - - - - - - 15 5 11 - - 11

1 L e s s than 1 p e r c e n t

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Table 21. G lass Jar P la n t -T y p e s of Industries P roviding 

Current J ob s1

Total,

Industry

P ercen t of

em ployed

w ork ers

all em ployed w ork ers 100

M a n u fa ctu rin g .....................

G lass ...................................

Containers (corrugated) 

Autos and auto parts. . .

F ood p r o d u c t s ................

Steel p r o d u c t s .................

T o o ls ...................................

Foundry ............................

Other ...................................

53

21

9

6

2

2

1

1

11

Nonm anufacturing ................

C o n s tr u c tio n .......................

H o s p it a l.................................

D om estic s e r v i c e ..............

Departm ent s t o r e ..............

Laundry and dry cleaning

Vending m a ch in e s ..............

R e sta u ra n t............................

O th e r........................................

31

3

2

2

1

1

1

1

20

G o v e rn m e n t.....................................

State colleg e ..............................

State p rison s ..............................

County d e p a rtm e n ts.................

M unicipal public sch ools . . . . 

Other m unicipal departm ents

11

4

1

1

4

1

S elf-em p loyed 5

1Jobs held at tim e of the survey.

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they had used new spaper ads and had applied to other com panies for job s. 

Few had gone to private em ploym ent agencies or to the union in their job 

search .

T w o-th irds of the w ork ers who actually obtained em ploym ent 

credited friends or relatives with the resp on sibility for locating their c u r ­

rent jo b s. One out of 6 credited the State em ploym ent se rv ice . Other 

sou rces w ere indicated by sm all proportion s of those who responded to this 

question.

M obility and R eem ploym ent. It appears that m obility had a sig n ificant influence on su ccess in finding w ork. Thus, 3 out of 5 unem ployed 

w ork ers had lim ited their area of job search to their hom e city, com pared 

with 1 out of 3 displaced w ork ers who obtained em ploym ent. On the other 

hand, only 1 out of 5 unem ployed sought w ork further than 50 m iles from 

their home city, as against 2 out of 5 of the reem ployed. As noted e a rlie r, 

roughly half of the latter, one-fifth of all reem ployed w ork ers, left their 

home city to obtain w ork in the glass industry elsew h ere. Home ow nership, 

fam ily ties, the sp ou se!s job , and insufficient funds w ere among fa ctors 

which appear to have affected w illingness to seek jobs outside the area. One 

displaced w orker said: nI would be w illing to go anywhere to find w ork if I

had the m oney to get there. n

Training and R eem ploym ent. A sm all p roportion of the displaced 

w ork ers reported that they had taken training cou rses since leaving the 

glass ja r plant. Such trainees constituted about 5 percent of the w orkers 

who had been reem ployed and 3 percent of those still unem ployed at the time 

of the survey.

The large m a jority of the respondents, 4 out of 5 em ployed and 9 out 

of 10 unem ployed, stated that they w ere interested in taking training cou rses 

if they w ere offered without charge. The kinds of training d esired covered 

a wide variety of occupational field s, from nursing and cle r ica l w ork to 

m achine operation and e le ctro n ics.

The recognition of the need for retraining displaced w ork ers is in dicated in the follow ing com m ents:

"Not able to find w ork, and not experienced in anything but 

fa ctory w ork. " (Age 37)

"T his has taught m e that everyone should have som e training in 

a special field . There are too m any untrained people like 

m y self looking for any kind of a job at any wage. " (Age 50)

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Some Job E ffects of D isplacem ent

E ffect on E arnings. T h ree-fou rth s of the reem ployed w ork ers 

experien ced a lo ss in earnings (table 22). F or half of those with low er 

earnings, the drop was 30 percent or m ore. In addition, a substantial num ­

ber had an earnings loss of between 20 and 30 p ercen t. Only 19 percent of 

the total num ber of em ployed w ork ers in crea sed their earnings.

Table 22. G lass Jar P lant--C hange in Earnings L evel

P ercen t on current job r e c e iv in g --

H ourly earnings level 

at closed plant Total

At

least

30%

le ss

20. 0- 

29. 9% 

le ss

10. 0- 

19. 9% 

le ss

Up to 

9.9% 

le ss

Same

earn -

ings1

Higher

ea rn ­

ings

A ll em ployed w ork ers . 100 37 17 10 10 7 19

Under $ 1 .9 0 . . . . . . . . . . . . 100 50 6 6 11 6 21 .

$ 1 .9 0 - $2. 2 9 ....................... 100 41 12 12 9 12 14

$ 2 ,3 0 - $ 2 .6 9 ...................... 100 16 31 10 8 8 27

$2. 70 and ov er .. ........ 100 37 19 13 10 5 16

1 Within 5£ either way.

Chart 10 shows that both age and education w ere clo se ly related to 

change in earnings le v e ls. The great m a jority of w ork ers at age 45 and over 

and m ost of those w ork ers with little or no high sch ool education experienced 

an hourly earnings lo ss of at least 20 p ercen t. On the other hand, the bulk 

of the w ork ers whose earnings in crea sed w ere either under age 45 or high 

sch ool graduates or both.

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Chart 10. G lass Jar Plant — Change in Earnings of

Reemployed Workers, by Age and Education

PERCENT LOWER EARNINGS 

IOO 80 60 40 20

PERCENT SAME OR HIGHER EARNINGS 

O 20 40 60 80

-----------1 ■ 1-----------1 ] — r ---------1----------- 1----------

w/rnmm AVERAGES

_______1-----------1-----------1-----------1---------- :

i_______1---------- i----------

IOO 80 60 40 20 AG E G ROUP

UNDER 36

35-44

45-54

55 AND OVER

A majority of the reemployed also stated that their present job was

inferior to their job at the glass jar plant in fringe benefits. The effects of

the loss of employee benefits were expressed with particular poignance in

the following comments:

HI had four more years to work and I could have retired, but I

lost my factory pension and retirement along with my job. Now,

I have no life insurance or hospitalization. 11 (Age 57)

f*I went to work when my husband left me with 3 small children

and was going to finish my life with my factory pension. Now,

I have nothing.ri {Age 57)

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Changes in Type of Job. Many of the reem ployed w ork ers accepted 

jobs at low er sk ills. (See table ZO. ) F or exam ple, about one-third of the 

sem isk illed m achine operators who obtained reem ploym ent w ere in la b orer 

or custodial jo b s. While alm ost th ree-fou rth s of the w om en w ork ers in 

packing occupations w ere unem ployed, alm ost half of those with job s w ere in 

d om estic or restaurant w ork. A num ber of form er m aintenance w ork ers 

w ere reem ployed in m achine operator or la b orer job s.

In com paring their current job with their job at the glass ja r plant, 

a m a jority con sidered their current job w orse in term s of both wages and 

fringe benefits. Only 25 percent felt there was any im provem ent in p rosp ects 

for prom otion . Substantial p roportion s (40 percen t or m ore) believed that 

there was little change in three other aspects of the j o b - - supervision, travel 

to w ork, and hours of w ork.

E ffects on Unionization. Union m em bership among the displaced 

w ork ers fe ll sharply. B efore the la yoff, 9 out of 10 w ork ers belonged to a 

union. At the tim e of the survey, the ratio of union m em bership was reduced 

to 1 out of 3. Even among those w ork ers who w ere em ployed, union m e m b e rship had dropped by half, from 86 percent to 44 percent of the total number 

of em ployed w ork ers, probably due la rg ely to reem ploym ent in unorganized 

plants. In the case of the unem ployed, m em bership fell to less than on e-sixth 

of the previous lev el.

L oss of Seniority. As indicated e a rlie r, the average displaced w orker 

had accum ulated 18 years of seniority at the glass ja r plant. One out of five 

had had m ore than 25 years of sen iority. The lo ss of this seniority signified 

a lo ss of job secu rity fo r several years to com e, since those reem ployed by 

other com panies would have the least p rotection against further layoff. It 

also meant the lo ss of accum ulated cred its toward econ om ic benefits, 

including vacation, pension, and other fringe em ployee benefits.

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V. A C losed F loor C overing Plant

A floor coverin g plant in the East was clo se d in June 1961, displacing 

over 300 w ork ers. This was one of 7 plants of the same com pany, all located 

in the eastern part of the country. The survey on which this study is based 

was conducted in O ctober 1962, 16 months after the plant closin g .

D escription of Plant

The shutdown represented a consolidation of the fir m 's activities due 

p rim a rily to changing consum er tastes, a greatly d ecrea sed demand for a 

type of flo o r coverin g which the plant was geared to produ ce. The com pany's 

p rofit and lo ss statem ents showed a net lo ss in 4 of the 5 y ea rs, 1957-61.

The plant had been constructed about 35 years ea rlier and had been 

enlarged 14 years p rior to its closin g.

The plant was located in a highly industrialized m etropolitan area, 

in which about on e-th ird of the total labor fo rce and tw o-fifths of all nonagricultural em ploym ent w ere in m anufacturing. The principal m anufacturing industry in the area was ch em icals, follow ed by transportation equipm ent. 

Other industries w ere stone, clay and glass products, food, m achinery, and 

fabricated m etals.

The labor m arket area was cla ssifie d by the U .S . Departm ent of 

Labor during the p eriod between the layoff and the survey as an area of 

m oderate unem ploym ent. The unem ploym ent rate was 5. 9 percent in the 

month of the plant shutdown, June 1961, and declined to 4 .0 percent one 

year la ter. It declined further to 3.0 percent in O ctober 1962, the month 

of the survey. Thus, general econom ic conditions in the labor m arket area 

w ere relatively favorable for reem ploym ent after the layoff.

M easures to Ease D isplacem ent

The d ecision to close the plant was m ade in F ebruary 1961, 4 months 

before the plant shutdown. The em ployees w ere first notified of this decision 

by letter during that m onth. They w ere kept further inform ed by bulletins 

and letters.

Interplant T ra n s fe r s . In M ay 1961, the w ork ers w ere notified that 

the operations w ere being m oved to the com pany's plant in another city,

70 m iles away, and w ere advised that they m ight apply for rehiring by that 

plant in accord a n ce with the union agreem ent.

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The displaced w ork ers w ere represented by an industrial type of 

union, affiliated with the A F L -C IO . T heir union agreem ent cov ered the 

production and m aintenance w ork ers of the plant to be clo s e d and two other 

plants o f the com pany loca ted in other a rea s. The agreem ent provided that, 

if the com pany discontinued all m anufacturing operations in any one of the 

three co v e re d plants, the em ployees of that plant would have ’’p referen ce 

fo r em ploym ent opportunities at any of the other two plants. M P referen ce 

would be in the ord er of the clo s e d plant sen iority. This contractual right 

to reem ploym ent was lim ited by the follow ing fa ctors: (l) Any em ployees

cu rren tly on la yoff from the plant with the em ploym ent opportunities would 

have firs t opportunity for reca ll; (2) T ra n sferred em ployees would lose 

their sen iority for future la y off and other pu rposes, except for pension, 

insurance and health benefits, and paid vacation; and (3) E ligibility for 

reem ploym ent was subject to physical and m ental qualifications, and know ledge, training, and skill.

Although 3 out of 5 displaced w ork ers had m ade application to be 

placed on the re ca ll list at the closin g of the flo o r coverin g plant, rela tiv ely 

fe w --n o m ore than 1 out of 8 - -a ccep ted em ploym ent in the other plant.

P ension B en efits. A negotiated pension plan m ade p rovision for 

reduced ea rly retirem ent pensions for w ork ers at least 60 years old with 

15 or m ore years of cred ited se rv ic e . T hirteen w ork ers w ere eligible for 

ea rly retirem en t at the tim e of plant closin g . Four of these shortly th ereafter becam e elig ib le for norm al retirem en t, and the other 9 elected to take 

their ea rly retirem en t benefits rather than wait for a full pension at 65. The 

plan m ade no p rov ision for vested rights in a d eferred pension for w ork ers 

below ea rly retirem ent age.

Separation P a y . Separation paym ents w ere given to som e salaried 

em p loyees in a ccord a n ce with com pany p ra ctice. P rodu ction w ork ers, how ­

ever, w ere not eligible for such paym ents.

P lacem ent of D isplaced W ork ers. The com pany w rote one letter 

to each of 47 com panies to a ssist in placem ent of wage em ployees, and two 

letters to each of 23 com panies to a ssist its sa la ried w ork ers in finding 

em ploym ent. A representative from the State em ploym ent serv ice v isited 

the plant to explain unem ploym ent insurance p roced u res.

Unem ploym ent C om pensation. Unem ploym ent insurance benefits 

w ere obtained by 87 percent of the displaced w ork ers for an average of 25 

w eeks. About on e-th ird of the w ork ers re ce iv e d benefits for 31 w eeks or 

m o re . Only 27 percent receiv ed le ss than 11 w eek s’ com pensation.

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P erson a l C h aracteristics of the D isplaced W orkers

A ll but a sm all p roportion of the displaced w ork ers w ere m en, and 

nearly all w ere white. (See chart 11 and table 23. ) The m edian age of d is ­

placed w ork ers at the tim e of term ination was 43. About on e-fifth w ere under 

35 and another fifth w ere age 55 and ov er. O ne-third w ere in the 35-44 age 

group. A v ery sm all proportion , about on e-sixth , had finished high sch ool, 

and m ore than tw o-fifths had not attended high sch ool at all.

N early fou r-fifth s of the displaced w ork ers w ere m a rried , and only 

one-tenth w ere single. O ver half supported two or m ore dependents. T w othirds owned their own hom es. T w o-fifths had 11-15 years of serv ice in the 

plant. O ne-fifth had le ss than 6 years of seniority; and one-eighth had 21 

years and ov er.

Chart 11. Floor Covering P la n t— Personal C haracteristics o f Displaced W o rk e rs.

FEMALE-3% 7 OTHER j

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Table 23. F loor C overing P la n t--S elected C h a ra cteristics and 

Em ploym ent Status of D isplaced W orkers

C h a ra cteristics

A ll

d is ­

placed

w orkers

Em ploym ent status1

Total E m ­

ployed

Unem ­

ployed

Not

seeking

em ploym ent

P ercen t

Total, all w o r k e r s .......... 100 100 74 17 9

Sex:

Klale ........................................ 97 100 75 16 9

F e m a le ................................... 3 100 50 40 10

R ace:

White ..................................... 94 100 76 17 7

O th e r........................................ 6 100 67 20 13 If

L ess than 35 years ......... 21 100 72 26 2

35 - 44 y e a r s ....................... 34 100 83 16 1

45 - 54 y e a r s ....................... 26 100 77 20 3

55 years and over ............ 19 100 47 6 47

Education:

No high s c h o o l..................... 44 100 75 20 5

Some high s c h o o l .............. 40 100 75 17 8

High sch ool graduate . . . . 16 100 89 7 4

H ourly earnings level:

Under $2. 0 0 ....................... 13 100 60 24 16

$ 2. 00 - $ 2. 14 ................... 32 100 79 19 2

$2. 15 - $ 2. 29 ................... 29 100 71 20 9

$2. 30 - $ 2 .4 4 ................... 12 100 81 3 16

$ 2. 45 and o v e r ................... 14 100 84 8 8

l At tim e of the survey.

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Job Hunting E xperien ce

Em ploym ent and Unem ploym ent. Although the rate of unem ploym ent 

in the labor m arket area as a whole was down to 3 percent at the tim e of the 

survey, 17 percent of the displaced w ork ers w ere still unem ployed. Another 

9 percent w ere not seeking w ork. Seventy-five percent w ere em ployed.

(See table 2 3 .)

M oreov er, m ore than 50 percent of the displaced w ork ers had been 

unem ployed on e-h alf year or lon ger. (See table 24. ) Two out of three had 

experien ced at least 16 weeks of unem ploym ent. Only 8 percent did not lose 

any tim e at all, and 18 percent lost le ss than 6 w eeks. C lose to 2 out of 3 

of all displaced w ork ers had had only one job in the 16 months between the 

date of the plant closin g and the tim e of the survey. One out of 7 had had two 

job s in that interval. Few had w orked fo r m ore than two em p loyers.

Table 24. F loor C overing P lan t--D u ration of 

Unemployment

Length of tim e unem ployed

P ercen t 

of all 

w ork ers

P ercen t of displaced 

w ork ers cu rren tly1- -

E m ployed Unem ployed

T otal2 ............................................. 100 100 100

No days lost ................................... 8 10 —

Up to 1 w e e k ................................... 2 3 - -

2 - 5 w e e k s ..................................... 8 10

6-10 w e e k s ................................... 6 8

11-15 w e e k s ................................. 10 13

16 - 20 w e e k s ................................. 9 11 2

21 - 25 w e e k s ................................. 5 6 2

26 or m ore w eeks ....................... 52 39 96

1

2

At tim e of the survey.

D oes not include w ork ers not seeking em ploym ent.

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Age and R eem ploym ent. The rate of reem ploym ent was highest 

(83 percent) in the 35-44 age group and next highest (77 percent) at age 

45-54. (See table 23.) Except for the oldest age group, in which close to 

half of the w ork ers w ere not seeking em ploym ent, em ploym ent was low est 

(72 percent) in the youngest age group. Unem ployment accounted for 26 

percent of the group under 35 as com pared with 16 percent of the w ork ers 

age 35-44.

Unem ploym ent, how ever, was of shorter duration among the younger 

w ork ers. (See chart 12.) L on g -term unem ploym ent of 26 weeks or m ore 

was experien ced by 44 percent of those under 35, 51 percent of those at age 

35-44, and 58 percent of w ork ers who w ere 45 or ov er.

Chart 12. Floor Coverning Plant - Long-Term Unemployed as Percent of Total Displaced

Workers, by Age and Education

PERCENT

8 0

70

6 0

50

4 0

30

20

10

0

UNDER 35 35-44

V///M 16 Weeks or more duration

26 Weeks or more duration

45 -54 55 or Over NO SOME HIGH SCHOOL

HIGH SCHOOL HIGH GRADUATE

SCHOOL

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The ob sta cles to reem ploym ent posed by age w ere m ost frequently 

com m ented upon by respondents to the questionnaire. The follow ing are 

som e sam ple com m ents:

"W hen y ou rre 40 years of age, no w ork. 11 (Age 40)

MI feel that not only fo r m y self, but many in m y age group, 

tim e is fast running out on us. 11 (Age 42)

MIf I w ere a few years old er, I doubt that any com pany would 

hire m e. n (Age 38)

f,They don*t want old er people .... I have to w ork as I have 

no one to support m e . . . .Too young to retire and too old 

to w ork, as it seem s. " (Age 53)

,fMy age was a big fa ctor .... They told m e so. M (Age 49)

Education and R eem ploym ent. The sm all p roportion who had graduated from high sch ool fared significantly better (only 7 percent unem ployed) 

than those who had no high sch ool or had gone to high sch ool but had not been 

graduated (20 percent and 17 percen t, resp ectiv ely ). As shown in chart 12, 

there w ere also con siderably few er lon g -term unem ployed among the graduates than among either of the other groups.

A cross-ta b u la tion of em ploym ent status by education fo r two age 

groups, ,!le ss than 45lf and ,!45 and ov er, 11 reveals virtually no d ifferen ce in 

reem ploym ent experience between educational levels fo r the younger group 

(table 25). Am ong the older w ork ers, how ever, there was a clea r rela tion ­

ship between em ploym ent and education. The unem ployed accounted for 1 out 

of 4 w ork ers with no high school education, 1 out of 7 w ork ers with som e 

high sch ool, and none among high sch ool graduates.

A num ber of displaced w ork ers stated that they w ere ham pered by 

inadequate education in seeking reem ploym ent. Some cited other fa c t o r s - - 

age, no tr a d e --a s w ell as education.

Some exam ples:

tfI donlt know what I could qualify for, since I have only an 

eighth grade education .... I have been working in 

different plants fo r the past 18 y ea rs, doing unskilled w ork, 

and I am still subject to la yoffs. fr (Age 33)

MI find it very hard to get a job after the age of 35, if you 

don!t have any special training, or are not a high sch ool 

graduate. n (Age 35)

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Table 25. F loor C overing P lan t--E m p loym en t Status of D isplaced W ork ers, 

by Selected Age Group and Educational L e v e l1

Educational level

P ercen t

A ll d is -

placed

w ork ers

Em ploym ent status

A ll

w ork ­

ers

E m ­

ployed

U nem ­

ployed

Not seeking 

em ploym ent

L ess than 45 years

A ll educational levels .... 100 100 88 12 0

No high s c h o o l ............................ 33 100 86 14 0

Some high s c h o o l....................... 48 100 88 12 0

High sch ool graduates ............ 19 100 88 12 0

45 yea rs and older

A ll educational levels . . . . 100 100 66 19 15

No high s c h o o l ............................ 60 100 68 25 7

Some high s c h o o l....................... 30 100 54 14 32

High sch ool graduates ............ 10 100 86 0 14

1 Age and education lev el at term ination.

Note: D ifferen ces between tables 23 and 25 are due to exclu sion of 

questionnaires that did not contain data fo r both age and education.

"M ost em ployers today are looking fo r at least high sch ool 

graduates. (I have only 2 years of high s c h o o l.)" (Age 37)

"I find it v ery hard to get a job in plants because of lack of 

education and no trade. " (Age 41)

Skill L evel and R eem ploym ent. The rate of unem ploym ent was 

highest in the low est skill cla ssifica tion , la b orers (table 26). It was at about 

the sam e level fo r both sem isk illed m achine op era tors and higher skilled 

m aintenance w ork ers.

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T a b l e 2 6 . F l o o r C o v e r i n g P l a n t - - E m p l o y m e n t B e f o r e a n d A f t e r T e r m i n a t i o n , b y O c c u p a t i o n

O ccupation at c lo sed plant

P ercen tage d i s ­

tribution 

at closed 

plant

E m ploy m en t status at su rvey date (percent)

All

w o rk ­

e r s

U n e m ­

ployed

E m ploy ed in p resen t job a s- '

O p e r a ­

tor

M a in ­

tenance

w o rk er

L a b o r e r S u p e rv iso r

C le r ical

w o rk er

C u s t o - 

dial 

w o rk er

Other

O p e r a t o r ..................................................... 38 100 2 2 29 9 18 1 1 6 1 4

M a i n t e n a n c e w o r k e r ........................ 16 100 21 10 51 15 - - - - - - 3

L a b o r e r ........................................................ 37 100 33 16 9 28 -- -- 2 12

S u p e r v iso r ............................................... 5 100 31 - - - - 15 3 9 -- -- 15

C l e r i c a l w o r k e r ................................. 4 100 18 5 5 27

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C onsidering earnings level as a rough m easure of skill, the highest 

unem ploym ent ra tes--ra n g in g from 19 percent to 24 p e rce n t--w e re found in 

the earnings levels below $ 2.30 per hour (table 23). The low est unem ployment ra te s --3 percent and 8 p e r c e n t--o c c u r r e d among the groups with 

earnings at $ 2. 30 and over.

Industries P roviding J ob s. F ew er than 2 out of 3 of the displaced 

w ork ers who responded, to this question obtained em ploym ent in other m anufacturing plants. (See table 2 7 .) Those w orking in the sam e industry w ere 

only the w ork ers tra n sferred to a plant of the sam e flo o r coverin g firm in 

another area and amounted to 17 percent of all reem ployed w ork ers. Other 

m anufacturing industries significantly represented w ere rubber produ cts, 

ch em ical produ cts, and tex tiles. M ore than on e-fifth of the total w ere 

em ployed in nonmanufacturing in du stries, and m ost of the rem ainder in 

governm ent. A very sm all p roportion w ere self-em p loy ed .

Table 27. F lo o r Covering P la n t--T y p es of Industries 

P roviding C urrent J ob s1

Industry

P ercen t of 

em ployed 

w ork ers

T otal, all em ployed w ork ers ................... ............. 100

M a n u fa ctu rin g .............................................................

F lo o r coverin g (T ra n sfers to another plant of

63

the sam e com pany) ............................ 17

Rubber p r o d u c t s ................ .. 8

C hem ical products . . . . . . . . . . . . . . . . . . . . . . . . . 7

T extiles ............................................................................. 7

W allboard p r o d u c t s ...................................................... 4

T ransportation equipm ent........................................ . 2

Other .......................... ................................................ 18

Nonm anufacturing ............................ ................................ 22

Construction .................................................................... 5

Other ................................................................................. 17

G o v e rn m e n t........................................................................... 13

F ed era l G o v e rn m e n t................................................... 1

State G o v e rn m e n t.......................................... ............... 4

County G o v e rn m e n t...................................................... 3

M unicipal Governm ent ............................................... 5

S e lf-e m p lo y e d ......................................... ........................... 2

1 Jobs held at tim e of the survey.

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A ssistan ce in Finding Jobs. The two sou rces m ost w idely used in 

looking for w ork, each cited by m ore than half of the displaced w ork ers, 

w ere the State em ploym ent serv ice and friends or rela tiv es. A substantial 

number also indicated that they had replied to newspaper ads and had 

applied at other com pan ies. R elatively few had used private em ploym ent 

agencies or w ere referred by the union or com pany.

As the source responsible fo r actually locating their present jo b s, 

m ore than 3 out of 5 of the em ployed w ork ers cred ited frien ds or rela tives. 

About 1 out of 10 each cited new spaper ads and applications to other co m ­

panies fo r jo b s. The State em ploym ent serv ice was named by 6 percen t, 

private em ploym ent agencies by 5 p ercen t, and the union by 2 percen t of the 

reem ployed w ork ers.

M obility and R eem ploym ent. M obility appears to have been a fa ctor 

in su ccess in finding w ork. Sixty percent of those unem ployed at the tim e of 

the survey had lim ited their search fo r em ploym ent to their hom e city, 

com pared with 45 p ercen t o f those who w ere em ployed. A lso , a sm aller 

p roportion of the unem ployed than of the em ployed w ork ers (5 percent c o m ­

pared with 11 percent) had traveled m ore than 50 m iles from home to look 

fo r w ork.

A close analysis of the relatively sm all proportion of the term inated 

w ork ers, who w ere tra n sferred to one of the com pany1 s plants in a city 

70 m iles distant, sheds additional light on the m obility p rob lem s of displaced 

w ork ers. These w ork ers, while tran sferrin g earned pension rights and 

other econ om ic benefits, w ere otherw ise hired as new em ployees having lost 

all accum ulated sen iority for purposes of layoff and re ca ll. This might 

account in part for the sm all number of tra n sferees. As a group, the tra n sferees w ere old er than the other displaced w ork ers, tw o-thirds of them age 

45 or over com pared with few er than half of all d isplaced w ork ers in that 

age group. Of those giving inform ation as to hom e ow nership, 55 percent 

w ere hom eow n ers, a sm aller p roportion than fo r the non tran sferees.

About 4 out of 5 of the tra n sferees w ere still residing in the labor 

m arket area of the closed plant or nearby areas at the tim e of the survey. 

These people com m uted daily or m aintained a tem p orary, second residence 

in the new area during the workw eek. One stated that he had tra n sferred 

only because his age, 57, prevented him from securing other em ploym ent.

He stated:

MI had no ch oice but to go back to w ork with the com pany as

I was turned down at severa l plants because of m y age. I

now have to travel . . . 70 m iles each w a y .11

Another found he was unable to m aintain two hom es, and left the new job for 

a job in another State w here he could live tem p ora rily with rela tiv es.

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Training and R eem ploym ent. Only 2 percent of the w ork ers indicated 

that they had taken any training cou rses since leaving the flo o r coverin g 

plant. Seventy-seven percent of the total, and over 90 percent of those who 

w ere unem ployed, stated that they w ere interested in taking training; 12 

percent of those desirin g training w ere interested in learning to becom e auto 

m ech an ics. Others expressed interest in training as m achinists, w eld ers, 

ca rp en ters, and several other occupations.

A need for retraining was clea rly ex p ressed by one w ork er who stated 

that he had been "unable to secu re em ploym ent due to lack of training and age, 

after w orking with the com pany for 26 y ea rs. ,f (Age 46)

Some Job E ffects of D isplacem ent

E ffects on E arnings. Somewhat m ore than half of the reem ployed 

w ork ers experien ced a drop in hourly pay. (See table 28.) The decline 

amounted to 20 percent or m ore for one-fourth of the w ork ers. O ver onefourth obtained higher pay. The data reveal no clea r relationship between 

changes in wage lev els and skill level as represented by the hourly rate 

receiv ed at the flo o r covering plant.

Table 28. F lo o r Covering P lant--C hange in Earnings L evel

P ercen t on current job r e c e iv in g --

H ourly earnings level 

at closed plant Total

At

least

30%

le ss

20. 0-

29. 9% 

le ss

10. 0-

19. 9% 

less

Up to 

9. 9% 

less

Same

ea rn -

in gs1

H igher

ea rn ­

ings

A ll em ployed w ork ers . 100 8 16 18 12 18 28

Under $ 2 . 0 0 .......................... 100 9 14 23 4 9 41

$2. 00 - $2. 14 ..................... 100 2 13 26 8 25 26

$2. 15 - $2. 29 ..................... 100 12 23 6 17 23 19

$2. 30 - $2. 44 ..................... 100 9 18 23 14 36

$ 2. 45 and over ................... 100 10 6 20 17 17 30

1 Within 5£ either way.

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As shown in chart 13, age bore an im portant relationship to change 

in earnings lev els. About one-eighth of all the w ork ers in the low est age 

group had a decline in wages of at least 20 percen t. The ratio rose to on ethird in the 45-54 group, and was close to th ree-fifth s of the oldest group.

On the other hand, higher wages w ere associated with low er a g e --o v e r half 

of the youngest group and less than one-tenth of the oldest reported in crea ses 

in w ages.

Chart 13. Floor Covering Plant — Change in Earnings of

Reemployed Workers, By Age and Education

PERCENT LOWER EARNINGS

100 80 60 40 20 0 TOTAL

AVERAGES

PERCENT SAME OR HIGHER EARNINGS

0 20 40 60 80

100 80 60 40 20 AGE GROUP

UNDER 35

35-44

45-54

55 AND OVER

20 40 60

---------- 1----------1---------- 1----------1--------- 1 !

NO HIGH SCHOOL

SOME HIGH SCHOOL

W t, HIGH SCHOOL GRADUATE

____ 1____ 1__ 1 1 i i

2 At least 20 % lower earnings 

Less than 20 % lower earnings

Same earnings 

Higher earnings

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Increased wages w ere also associated with greater ed u ca tion --2 out 

of 5 high sch ool graduates as com pared with 1 out of 5 of those with no high 

sch ool received higher w ages. Significant declines in w ages, at least ZO 

p ercen t, w ere experien ced by a con siderably greater p roportion of w ork ers 

who had not attended high school than in the other two groups.

C lose to half of the reem ployed stated that their present job was less 

lib era l in fringe benefits than their job at the flo o r covering plant. Another 

third found no change and few er than on e-fifth believed that there had been 

an im provem ent. E xcept in the case of tra n sferred w ork ers, there was a 

total lo ss of rights to accum ulated pension benefits.

Between the tim e of the plant closing and the tim e of the survey, the 

p rop ortion of w ives working rose from a ratio of 1 out of 3 to 2 out of 5.

There was an in crea se both in w ives w orking fu ll-tim e and those working 

p a rt-tim e. The in crease occu rred m ostly among the w ives of reem ployed 

w ork ers.

Changes in Type of Job. A num ber of displaced w ork ers w ere 

reem ployed on job s at low er skill. One out of 4 of the sizable group of se m iskilled m achine op erators had been downgraded to la b orer and custodial jo b s. 

(See table 26.) Among the m ore skilled m aintenance w ork ers, 1 out of 10 

w ere em ployed as m achine op erators and nearly 1 out of 6 held la b orer job s. 

The only occupational groups in which a m ajority of the displaced w ork ers 

w ere reem ployed in the sam e cla ssifica tion s w ere m aintenance and cle r ica l 

w ork ers.

A m a jority or close to a m a jority of the w ork ers con sidered their 

present job w orse than their job at the flo o r coverin g plant, not only in term s 

of wages and and fringe benefits, but also in term s of type of w ork and prospects fo r prom otion . About half thought hours of w ork w ere about the same 

as b efore. O ver tw o-fifths believed that quality of supervision and travel to 

w ork w ere about the sam e. In none of the job com parison s did m ore than 

one-third con sider that their conditions had been im proved.

E ffects on Union M em bership. A consequence of the plant closin g was 

a m arked lo ss in union m em bership. M ore than 9 out of 10 w ork ers at the 

flo o r coverin g plant had been m em bers of the union. At the tim e of the 

survey, union m em bership among the displaced flo o r covering plant w ork ers 

had declined to less than tw o-fifth s. Even among the reem ployed w ork ers, 

it fe ll to less than half.

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VI. The C losing of Two Iron Foundries

A com pany with a number o f plants located in the M idw estern and 

W estern areas of the country clo se d two iron foundries in July I960 and 

M arch 1961, displacing a total of about 100 w ork ers. The survey was co n ­

ducted in A pril 1962, 21 m onths and 13 months resp ectiv ely , after the two 

plant closin g s,

D escription o f the Plants

The plant shutdowns resu lted from the developm ent of a new p ro ce ss 

to produce steel castin gs, which had been installed in som e of the com pan y's 

plants. C onsum er demand for the new product brought about an in crea se in 

production in these plants and the discontinuance of production in the two 

plants under study.

Both areas in which the plants w ere located are m a jor production and 

em ploym ent a rea s. One area had a labor fo rce of clo s e to 200,000. Manufacturing em ploym ent accounted for 1 out of 5 nonagricultural w ork ers. The 

m anufacturing industries with the la rgest em ploym ent w ere food, p rim ary 

m etals, and ordnance. Nonm anufacturing em ploym ent con sisted m ainly of 

w ork ers in trade, governm ent, and se rv ic e s . At the tim e of the survey, 

the labor m arket area was designated by the U .S . Departm ent of L abor as 

one of m oderate unem ploym ent. At the tim e of the layoff, in July I960, 

the unem ploym ent rate was 2. 8 percent. It rose the follow ing year and was 

3.7 percent in July 1961. Unem ployment declined in 1962 to 3. 1 percent at 

the tim e of the survey in A p ril and dropped further later in the year.

The second area is a large m etropolitan center which had a labor 

fo rce of w ell over 500,000. M anufacturing w ork ers accounted for 1 out of 

4 of total nonagricultural em ploym ent. The la rg est m anufacturing industries w ere m achinery and food. This area also was ch a ra cterized by 

m oderate unem ploym ent. The unem ploym ent rate for the area was up to

6. 9 percent when the plant was clo se d in M arch 1961, but fell to 3. 6 percent 

during the survey month in A pril 1962.

M easures to E ase D isplacem ent

Unem ployment C om pensation. A ll but 6 percent of the d isplaced w ork ers 

receiv ed som e unem ploym ent com pensation. O ne-fourth obtained unem ploym ent com pensation for 41 weeks or m ore; tw o-fifths for 31 w eeks or m ore; 

and th ree-fifth s for at least 21 w eeks. The average number of w eeks of 

unem ploym ent com pensation was 27.

Separation P aym en ts. Separation pay was provided for under union con tract. 

H ow ever, this generally amounted to only a few weeks* pay, sin ce a substantial proportion of the w ork ers had relatively little serv ice with the com pany.

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P lacem ent of D isplaced W o rk e rs. In both a reas, the w ork ers w ere given 

less than 6 months notice of the im pending plant closin g s. The companystated that it gave som e w ork ers the opportunity to tran sfer to other 

loca tion s, but very few accepted the offer and m ost of those who did accept 

soon returned to their h om es. The questionnaires showed that none of the 

displaced w ork ers w ere em ployed at other plants of the com pany. A p p rox im ately 1 out of 7 w ork ers stated that the com pany a ssisted them in looking 

for w ork. An equal num ber stated that the union, an AFL.-CIO affiliate, 

helped them .

P erson a l C h a ra cteristics of the D isplaced W orkers

V irtually all of the displaced w ork ers w ere m en; all but 7 percent 

w ere white. (See chart 14 and table 29.) At the tim e of term ination, the 

m edian age was between 47 and 48. O ne-fifth w ere under 35. T hree-tenths 

w ere 55 and ov er. The educational level was v ery low ; three out of 5 had no 

high sch ool training. M ost of the rest had not graduated from high sch ool.

Chart 14. Fo undrie s—Personal Characteristics of Displaced W orkers.

EDUCATION

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Table 29. Foundrie s - -S elected C h aracteristics and Em ploym ent Status

of D isplaced W orkers

C h a ra cteristic s

A ll

displaced

w orkers

Em ploym ent status1

Total E m ­

ployed

U nem ­

ployed

Not seeking 

em ploym ent

P ercen t

Total, all w ork ers . . . 100 100 59 28 13

Sex:

M a le ................................... 98 100 58 28 14

F e m a le .............................. 2 100 100 0 0

Race:

White ................................. 93 100 60 25 15

Other ................................. 7 100 33 67 0

Age:

L ess than 35 years . . . 21 100 72 28 0

35 - 44 years ................ 20 100 71 29 0

45 - 54 years ................ 29 100 68 28 4

55 years and over . . . . 30 100 35 35 30

Education:

No high s c h o o l .............. 58 100 50 34 16

Som e high s c h o o l......... 26 100 45 41 14

High school graduate . . 16 100 93 7 0

H ourly earnings level:

Under $ 2. 3 0 ................... 24 100 46 50 4

$ 2. 30 - $ 2. 49 .............. 26 100 52 36 12

$ 2. 50 - $ 2. 69 .............. 24 100 46 21 33

$ 2. 70 - $ 2. 89 .............. 20 100 83 17 0

$ 2. 90 and o v e r .............. 6 100 100 0 0

xAt tim e of the survey.

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A large m a jority of the d isplaced w ork ers w ere m a rried . A lm ost 

th ree-fifth s had no dependents or only one dependent. H ow ever, on e-fifth 

had 4 dependents or m o re . T w o-th irds w ere hom eow ners.

Plant sen iority averaged about 14 y ea rs. O ne-fifth had se rv ice not 

exceeding 5 y ea rs, and another fifth had serv ice from 6 to 10 y e a rs. H owe v e r, on e-fou rth had at least 21 years of sen iority.

Job Hunting E xperien ce

E m ploym ent and U nem ploym ent. At the tim e of the survey, tw o-fifth s of 

the d isp laced w ork ers w ere not em ployed. Tw enty-eight percent w ere unem ­

ployed and looking for w ork, and 13 percent w ere not seeking em ploym ent. 

(See table 29.)

The plant closin g s also had been follow ed by long p eriod s of unem ­

ploym ent. (See table 30.) M ore than half of the w ork ers w ere out of w ork 

for at lea st 26 w eeks. Seven out of 10 had 16 or m ore weeks of unem ploym ent. Even am ong those who w ere em ployed at the tim e of the survey, 

on e-th ird had been out of w ork a h a lf-y ea r or m o re .

T able 30. F ou n dries--D u ra tion of Unem ploym ent

Length of tim e unem ployed

P ercen t 

of all

w ork ers

P ercen t of disp laced 

w ork ers cu rren tly1- -

E m ployed U nem ployed

T otal2 ...... .............................................. 100 100 100

No days lost ............................................... 1 2 '

Up to 1 w eek ............................................... 7 11

2 - 5 w e e k s ................................................ 8 12

6 - 10 w eeks 8 7 11

11-15 w eeks ........................................ 7 9 4

16-20 w e e k s ............................................ 10 14

21 - 25 w e e k s ............................................ 7 11 - -

26 or m ore w eeks ................................... 52 34 85

lAt tim e of the survey.

2D oes not include w ork ers not seeking em ploym ent.

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O ne-fourth of all displaced w ork ers had held no job s at all since 

leaving the foundry. O ne-half of the total had had one jo b during the period . 

A s m any as 1 out of 4 had held two job s or m o re . One w ork er indicated the 

p reca riou sn ess of his reem ploym ent by stating: 11 W ill be laid off from present 

job because of au tom ation --17 others included. ir

Age and R eem ploym ent. Unem ploym ent was at about the same lev el, a little 

over one-fourth , am ong all age groups under 55 (table 29). At 55 and over, 

unem ploym ent am ounted to m ore than on e-th ird; and in addition alm ost one - 

third w ere not seeking w ork.

Com m ents by displaced w ork ers responding to the questionnaires 

m ost frequently cited age as a critica l handicap in secu ring reem ploym ent, 

for exam ple:

"W ho w ould h ire a man of 50 unless he w orked for n oth in g?”

(Age 51)

"T o o old to w ork and too young for a pension. I hope the 

G overnm ent would com e up with som e kind of w ork for us 

m en 50 and ov er. M (Age 50)

"E veryw here I looked for w ork they told m e I was too old. n 

(Age 49)

MIt was quite discouraging to be told I was too old. I am 

now 49 and can still put out a day’ s w ork. "

Education and R eem ploym ent. The rela tively sm all group of high sch ool 

graduates fa red con siderab ly better than all others, with a reem ploym ent 

total of over 90 percen t. (See table 29.) On the other hand, those with 

som e high sch ool education had a slightly w orse experience than w ork ers 

who had not attended high sch ool.

Table 31 presents a c r o s s tabulation of em ploym ent status by age 

and education. B ecause of the sm all number of w ork ers involved, only two 

age groups of about equal size are used: "le s s than 45 y e a rs"; and "45 years

and old er. " Am ong the older w ork ers, those who had som e high school 

education had a better reem ploym ent re co rd than those with no high school 

training. T heir unem ploym ent rate was about one-fourth , com pared with 

a rate of m ore than on e-th ird among the le ss educated. The high school 

graduates w ere too few for valid com parison . In the younger group, high 

school graduates had a con siderably m ore favorable experien ce than either 

of the other two groups, an unem ploym ent rate of only 8 percent. H ow ever, 

those who did not com plete high sch ool fared w orse than the w ork ers who 

did not attend high sch ool at all.

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The feelings of older workers with little education were expressed

by one respondent, 55 years old, as follows: l,My age is against me. My

education is against me. Nobody seems to want me anymore. n

Table 31. Foundries--Employment Status of Displaced Workers by

Selected Age Group and Educational Level1

Educational level

Percent

All

displaced

workers

Employment status

All

workers

EmployedUnemployed

Not seeking

employment

Less than 45' years

All educational

levels .................... 100 100 75 25 0

No high sch o o l............. 47 100 76 24 0

Some high school......... 20 100 43 57 0

High school graduate . . 33 100 92 8 0

45 years anc. older

All educational

levels .................... 100 100 49 32 19

No high sch o o l............. 68 100 44 37 19

Some high school . . . « . 28 100 54 23 23

High school graduate . . 4 100 100 0 0

*Age and educational level at termination.

Note: Differences between tables 29 and 31 are due to exclusion of

questionnaires that did not contain data for both age and education.

Skill Level and Reemployment. As shown in table 32, the rate of unemployment was highest for the lowest skill job, laborer. About one-half of the

workers in that occupational group were unemployed. Unemployment rates

among operators and maintenance workers were each about one-third.

A rough measure of relative skill is hourly earnings. For example,

the percent employed was considerably greater for the 1 out of 4 foundry

workers who had earned $2.70 or more per hour than for lower paid workers

(table 29). The rate of unemployment was by far the highest for the lowest

paid fourth who had received less than $2. 30 per hour.

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Table 32. Foundries--Employment Before and After Termination,

by Occupation

Occupation

at closed

foundries

Percentage distribution

at closed

foundries

Employment status at survey date (percent)

a h

workers

Unemployed

Employed in present job a s--

Oper -

ator

Custodial

worker

Laborer

Maintenance

worker

Other

Operator . . . . 55 100 36 16 24 13 0 11

Foreman . . . . 4 100 0 40 60 0 0 0

Laborer ......... 22 100 48 14 14 24 0 0

Maintenance

worker . . . 13 100 33 17 0 17 33 0

Clerical

worker .. . 6 100 0 0 0 40 0 60

Industries Providing Jobs. Only 8 percent of the reemployed workers found

jobs in other foundries. (See table 33.) Fewer than half were working in

manufacturing industries. Manufacturing industries providing the most jobs,

other than foundries, were machinery and fabricated metal products. Employment in nonmanufacturing firms was secured principally in construction

and retail trade. One-fifth were employed in government, mainly in schools.

Assistance in Finding Jobs. More than 3 out of 5 workers cited the State

employment service, friends or relatives, and classified newspaper ads as

sources used in seeking jobs. About equal proportions, 1 out of 8, named

the company, the union, and private employment agencies, respectively.

Friends or relatives was the source named as responsible for actually

locating present jobs by close to half of the reemployed workers. One out of

7 stated they had obtained their jobs without assistance. One-tenth credited

the State employment service. Four percent named the union.

Mobility and Reemployment. As indicated by the actions of the displaced

foundry workers, the mobility of the job seekers seems to have had little

effect on their success in securing employment. A slighter greater percentag*

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of the employed workers than unemployed stated that they had sought work

outside their home city. The same percentage of both groups, about 1 out

of 12, extended their area of job search further than 50 miles from home.

Table 33. Foundries--Types of Industries

Providing Current Jobs1

Industry

Percent of

employed

workers

Total, all employed w orkers........... 100

Manufacturing............................................... 42

Foundry ..................................................... 8

Other primary metal products ......... 4

Machinery................................................ 8

Fabricated metal products.................. 6

Paper products........................................ 4

O th e r ............................ ............................ 12

Nonmanufacturing........................................ 36

Construction............................................ 12

R etail.......................................................... 12

Other ..................................... 12

Government................................................... 19

Schools....................................................... 8

Hospitals.......................................... .. . . . 3

Other .......................................... 8

Self-employed ............................................... 3

^obs held at time of the survey.

Training and Reemployment. Only 4 percent of the workers reported having

taken training courses since leaving the foundries. Approximately 75 percent

of the workers, however, responded that they would be interested in taking

training if it were offered without cost to them. Among the training courses

most desired were welding, construction equipment, construction, mechanics,

and electronics.

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Some Job Effects of Displacement

Effect on Earnings, Three-fourths of the displaced foundry workers who

secured jobs suffered a decline in hourly earnings. (See table 34.) For

over one-fifth of the total, the drop in earnings was 30 percent or more.

For close to two-fifths, it was 20 percent or more. Only one-sixth had

higher earnings than at the foundry.

Table 34. Foundries--Change in Earnings Level

Percent on current job receiving--

T otal

At

least

30%

less

20. 0-

29. 9%

less

10.0-

19.9%

less

Up to

9.9%

less

Same

earnings1

Higher

earnings

All employed

workers ......... 100 22 16 22 16 8 16

Under $2. 3 0 ........... 100 8 8 25 17 17 25

$2.30 - $ 2 . 4 9 ____ 100 15 8 15 15 15 31

$2. 50 - $2. 6 9 ____ 100 25 25 8 33 0 8

$2. 70 - $2. 8 9 ____ 100 30 30 40 0 0 0

$ 2. 90 and over . . . . 100 67 0 33 0 0 0

1 Within 5£ either way.

Note: Because of rounding, sums of the individual items may not

equal 100.

Those most sharply affected were the workers previously at higher

wage levels. Well over half of those earning $2.50 or more per hour experienced a decline of at least 20 percent, compared with less than one-fourth

of those previously earning less than $2. 50. Moreover, virtually all of the

workers attaining increased earnings had been in the lower wage group.

Five out of 6 reemployed workers stated that their current jobs were

no better than their foundry jobs in fringe benefits, and close to half said

they were worse. The impact of the loss of fringe benefits, on top of the

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combined handicaps of age and education in seeking reemployment, was

expressed by a 54-year-old displaced worker as follows: llEvery place I

went. . . .too old and didn’t have a high school education. After 23 years

at one company. Then to lose everything, pensions and insurance.”

The proportion of wives working increased somewhat in families

with displaced men, but mainly where men were employed at the time of

the survey. The number of wives working full-time increased substantially,

among the families of both the employed and the unemployed men, since the

foundry closings.

Changes in Type of Job. Many workers were reemployed at lower skills.

Thus, most of the machine operators who were reemployed were working

at custodial or laborer jobs (table 32). A number of maintenance workers

obtained jobs as machine operators or laborers.

In comparing their current job with their foundry job, close to half

of the workers believed their current jobs to be worse in prospects for

promotion. Around half found there was no difference in supervision and

hours of work. Somewhat equal proportions stated that the type of work

was better, the same, or worse.

Effects on Union Membership. Before the closing of the foundries, 9 out of

10 workers were union members. At the time of the survey, however, union

membership among the displaced workers was reduced to one-third of the

total. A major part of the membership loss occurred among the unemployed

and those not seeking work. However, even among the employed, slightly

under one-half indicated that they were members of a union after reemployment.

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Appendix A. Scope and Method

This is a study of the characteristics and experiences after layoff

of close to 3,000 displaced workers.1 Information about the workers was

obtained from four sources: (1) the previous employer’ s payrolls and personnel records were used to obtain the names, addresses, and data on

certain characteristics of the displaced workers; (2) company officials and

union representatives were interviewed to obtain background information;

(3) questionnaires mailed to the workers contained most of the information

received from the employers for correction or corroboration by the workers,

and provided for additional information on worker characteristics and postlayoff experiences; and (4) local offices of the State employment service

agencies supplied data on length of unemployment and job referrals.

Obtaining the Data

In three cases, information was obtained from over 90 percent of

the displaced workers. In the other two, because of the large number of

workers involved, a sample of the displaced workers was selected for study:

1 out of 4 in the case of the petroleum refinery; and 2 out of 3 in the case of

the automotive equipment plant.

In each of the studies, more than half of the displaced workers to

whom questionnaires had been sent answered the first request. A second

request was sent to those not responding and generally about half of those

likewise responded. A sample of the remaining nonrespondents was

selected for follow-up. These generally were reached by telephone or,

if they could not be reached in that way, by personal visit. In a few cases,

when the selected nonrespondent could not be reached, some information

was obtained through neighbors or relatives. The information obtained

from the workers by telephone and personal visits was weighted to represent the other nonrespondents in the sample and nonrespondents who were

not In the sample in order to minimize any bias resulting from the possible

similarity of nonrespondents.

lThe individual case studies concerned: (1) about 800 workers laid

off by a Midwest petroleum refinery in the course of a year; (2) over 1,000

workers displaced by the shutdown of a Midwest automotive equipment plant;

(3) some 600 workers displaced upon the partial closing of a Midwest glass

jar plant; (4) about 300 workers displaced by the closing of an Eastern floor

covering plant; and (5) about 100 workers displaced by the shutdown by a

single employer of two iron foundries, one in the Midwest and the other in

a Mountain State. Because the small number of workers displaced by the

closing of each of the two iron foundries limited feasible statistical breakdowns, the data for both foundries have been combined to form a single case

study.

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A comparison of the information from the voluntary respondents and

that obtained by telephone and personal visits revealed no significant differences in characteristics or status. Observations made by the nonrespondents

indicated that they generally felt more bitterly toward their previous employer

or their union. Several stated they did not respond because they could not

adequately report their feelings. Others said they were suspicious that the

company was connected with the study and was seeking information.

Tabulation of the Data

Answers to each question were tabulated independently. Because of

omissions, therefore, the number responding to each question varied. In

each instance, only those responding to a particular question were included

in the tabulation and the total number of answers were given the value of

100 percent. This variation in the total number of cases sometimes resulted

in minor discrepancies in cross tabulations requiring answers to two or more

questions. Such discrepancies have been noted where they occurred. On

some tables, percentages do not total 100 because of the rounding of decimals.

Since some of the questions asked for opinions or could be interpreted

differently, there were also other apparent inconsistencies in the tabulations.

For example, the workers were asked to evaluate their present wages as

"better,” "w orse," or "sa m e ." In some cases, they would consider a lower

wage as "better" because they were able to work more hours. No attempt

was made to edit either fact or opinion answers. Where there was an obvious

misunderstanding, the answer was omitted from the tabulation.

Throughout the study, data on length of time unemployed or length of

period for which unemployment insurance benefits were received include all

unemployment experiences between the time of layoff and the time of the survey. The terms "employed" and "reemployed" are used interchangeably and,

for the purposes of this report, have the same meaning.

Limitations of the Study

In evaluating the findings of this study, it is important to note certain

limitations of its scope and method.

First, as a series of case studies, the study as a whole is at most

illustrative, not representative, of the characteristics and experiences of

workers who have been displaced because of technological or other change.

Some generalizations have been made from the data, but the data in the

separate case studies have not been combined statistically. What has been

attempted in the summary section was a comparison of the data for the different case studies to bring out any consistent patterns or contrasts that they

might reveal.

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Second, the study was based on written questionnaires sent to the

homes of the displaced workers, as well as written records of the companies involved and the local offices of the State employment service agencies.

Because of the size of the project and time limitations, no oral interviews

were obtained from the voluntary respondents to secure other than the basic

employment data requested in the questionnaires. Consequently, the questions had to be more limited and simpler than might otherwise have been the

case to prevent misunderstanding. Even so, there was some variation in

the answers to certain questions, depending on the respondents interpretation of the information requested. Also, it is clear from some of the comments that, despite the statement on the use that would be made of the

questionnaire, some respondents might have hoped for some benefits or

assistance as a result of their cooperation, and such expectations might

have influenced their answers.

Third, it was not feasible to establish a uniform time interval between

layoff and survey. Consequently, the interval varied broadly from a minimum

of 6 months to a maximum of 21 months. In one case, a large-scale layoff

was carried out over a period of more than a year, and the period between the

layoffs and the survey varied from 6 months to over a year and a half. Much

of the data on employment and unemployment and duration of unemployment

were affected by the time that had elapsed after layoff.

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Appendix B. Selected Bibliography of Displaced Worker Studies

Adams, Leonard P.; and Aronson, Robert L. Workers and Industrial

Change (Ithaca, N. Y. , Cornell University, 1957). 209 pp.

Automation Committee (Clark Kerr, Chairman), Progress Report of

Armour’s Tripartite Automation Committee (Chicago, June 19, 1961).

29 pp. Excerpted in Monthly Labor Review, August 1961, pp. 851-857.

Clague, Ewan; Couper, Walter J. ; and Bakke, E. Wight. After the

Shutdown (New Haven, Conn., Yale University, 1934). 153 pp.

Creamer, Daniel; and Coulter,__Charles W. Labor and the Shutdown of the

Amoskeag Textile M ills. /U .S ^/ Works Progress Administration,

Report No. L-5 of the National Research Project (Philadelphia, Works

Progress Administration, November 1939). 342 pp.

Creamer, Daniel; and Swackhamer, Gladys V. Cigar Makers--After the

Lay-Off: A Case Study of the Effects of Mechanization on Employment

of Hand Cigar Makers. /U .S. / Works Progress Administration, Report

No. L -l of the National Research Project (Philadelphia, Works Progress

Administration, December 1937). 93 pp.

Ferman, Louis A. Death of a Newspaper: The Story of the Detroit Times

(Kalamazoo, Mich. , The W. E. Upjohn Institute for Employment

Research, April 1963). 63 pp.

Haber, William; Ferman, Louis A .; and Hudson, James R. The Impact of

Technological Change: The American Experience (Kalamazoo, Mich. ,

The W. E. Upjohn Institute for Employment Research, September 1963).

62 pp.

Lubin, Isador. The Absorption of the Unemployed by American Industry

(Washington, Brookings Institution, 1929). 4 2 pp.

Miernyk, William H. Inter-Industry Labor Mobility: The Case of the

Displaced Textile Worker (Boston, Northeastern University, 1955).

158 pp.

Myers, Charles A. ; and Shultz, George P. The Dynamics of a Labor

Market (New York, Prentice-Hall, Inc., 1951). 219 pp.

Myers, Robert J. ’’Occupational Readjustment of Displaced Skilled

Workmen, ” Journal of Political Economy, August 1929, pp. 473-489.

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Palmer, Gladys L .; and Williams, Constance. Reemployment of Philadelphia Hosiery Workers After Shutdowns in 1933-34. /U .S. / Works

Progress Administration, Report No. P-6 of National Research Project

and Industrial Research Department, University of Pennsylvania (Philadelphia, Works Progress Administration and University of Pennsylvania,

January 1939). 100 pp.

Sheppard, Harold L. ; Ferman, Louis A. ; and Faber, Seymour. Too Old

to Work--Too Young to Retire: A Case Study of a Permanent Plant

Shutdown. Special report, U.S. Senate, Special Committee on Unemployment Problems, 86th Cong. , 1st sess. (Washington, Government

Printing Office, I960). 74 pp.

Sheppard, Harold L.; and Stern, James. "Impact of Automation on

Workers in Supplier Plants, " Labor Law Journal, October 1957,

pp. 714-718.

Weber, Arnold R. "Interplant Transfer of Displaced Employees, " Adjusting to Technological Change, edited by Gerald G. Somers and others

(New York, Harper and Row, 1963), pp. 95-143.

Wilcock, Richard C. "Employment Effects of a Plant Shutdown in a

Depressed Area, " Monthly Labor Review, September 1957, pp. 1047-

1052. For full report, see BLS Bulletin 1264 (i960), Impact on Workers

and Community of a Plant Shutdown in a Depressed Area.

Wilcock, Richard D.; and Franke, Walter H. Unwanted Workers: Permanent Layoffs and Long-Term Unemployment (New York, Free Press of

Glencoe, 111. , 1963). 340 pp.

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