Evening star., 1950-04-07

nomic legislation made during tn
1905 was to establish the Federal
State system of employment Sc
curity. This system has two parts
first, q Nation wide employment
service to help workers find job
and employers find job-seeker'
and. second, a Nationwide system
Of unemployment insurance to he'll
tide workers over periods of un
employment.
Finding a job is of more import
Ance to an unemployed worker, o
course, than receiving unemploy
ment insurance benefits. Conse
quently, great emphasis has alway
been placed on strengthening AM
Improving the employment service
We cannot, however, completely
eliminate unemployment; even il
time Of high employment, there vii
be turnover of jobs and numerou
shifts and changes In job oppor
tunities. Consequently. we mus
have a strong and steadily improv
ing system of unemployment in
surance.
Under our Federal-State unem
ployment system, benefits are paid
In accordance with State laws, tt
workers who, while able and seeking
to work, are unemployed through
fits are paid from the proceeds oi
State payroll taxes, which are de.
posted in reserve accounts-one fol
each State-in the Unemployment
Trust Fund in the United States
Treasury.
In the past twelve years, unem.
ployment insurance has proved its
worth not only as an invaluable
source Of support to unemployed
workers and their families, but also
Is means of maintaining pur-
chasing power of great value tc
the entire economy. In 1949, fol-
example, IT. billion dollars in bene-
fits were paid to more than seven
million individuals, the largest
amount for any year in the history
Of the system. This was a sig
nificant factor in preventing serious
dislocations during last years period
Of economic readjustment.
System Not Adequate.
Our experience with unemploy-
ment insurance has revealed weak
nesses as well as strengths in the
existing system. While many i'm
provements have been made in the
State laws since the program be-
gan, the system is far from ade-
quate today.
Over Is million workers-about
one-third of all employes-are not
protected by unemployment insur-
ance. In 1949, only about one-fifth
Of the purchasing power lost
through unemployment was re-
placed by unemployment insurance
benefits. In 1919, weekly benefits
averaged only, about $20-not
enough to preserve a minimum
standard Of living. Nearly mil
lion workers used up their benefits
entirely-showing that benefits were
not available for long enough
period. While the unemployment
reserve funds Of the States have sc
far proved to be adequate, few
States may soon face financial
difficulties because of local concen-
tration of unemployment.
On several occasions in recent
years, I have recommended that
the system be improved, to extenc
protection to many workers not nov
covered; to provide, in every State
benefits for 26 weeks ranging up tt
$50 a week for single persons, with
additional benefits for dependents
and to increase the financial sta
bility of the system.
Action on these proposals has be-
has increased somewhat in spite of
the continuing high levels of bust
ness activity. While unemployment
dropped over half million between
February and March, on the aver
age nearly Az million persons were
looking for work during the first
three months of this year, as COM
pared to 3 million in the same
months of 1949, and nearly 212
million in 1948. Furthermore, the
length of time it takes people tc
find jobs is becoming longer. One
million people-about one out o1
every four unemployed-have beer
out of work for Is weeks or more
A year ago, only 100000 were with
out jobs that long, and in 1948, only
$4,000.
More Looking for Work.
This gradual growth in unemploy.
ment over the last two years is not
because there are fewer Jobs. En-.
ployment has remained at high
levels, along with industrial pro-
duction, consumer incomes, anc
other indicators Of the health Of
our economy.
But there are more people looking
for work. In recent years, up to ONT
million more people have come int
the labor market each year, lookins
for work, than have left the Labor
market. Part of the new group en-.
tering the labor market will be tn,
largest number of college graduate
In our history-Some 100000 youns
people, including about 25OOOO vet
Grams. In addition, of course,
large number of high school gradu
ates will also be looking for Jobs.
Furthermore, as new plants ant
equipment have been added ant
supplies of raw materials have be-
come more ample, businessmen hav,
been able to produce more will
the same number of workers.
Thus. our labor force has in
creased, our productivity has in
creased, but the number of Job
has not kept pace. This empha
sizes the Importance of expandin,
our economy so that new jobs will
be created to use skills and ener
gies that are now being wasted.
also emphasizes the Importance O
making better provision for thos
who are temporarily out of work.
The Congress now Is well alon,
toward completing action on legis
lation to improve the old-age ant
survivors insurance and public as