Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-01-17

surplus of 100000. After the organ
ization Of the industry's workers by
the United Automobile Workers
tCIO), and the institution of senior
ity rights and pension plans, the
industry no longer felt there was
any point to fostering large labor
surplus
In the days Of World War II
Detroit came to be perennially short
of labor. At the end of 1943 there
were only about 400 persons drawing
j unemployment insurance checks in
all metropolitan Detroit.
Dividing Line
It is generally considered now
that S per cent unemployment is
the dividing line between a labor
shortage and labor surplus in
Detroit. The Federal Government
uses 6 per cent as one of the criteria
for distressed community" CLASH
fication. With Z per cent out now
and projection of rs per cent by
summer. there seems to be no doubt
that Detroit Is surplus area. And
while neutral observers deny that it
Is a distressed community" yet,
they stress the yet" in their denial.
A glance at the chart on this page
reveals a significant fact about De-
troit'S labor situation today. Since
things got Strengthened out after the
war-starting at January /. 1915
there have been only five serious
unemployment situations, not in
Guiding the present one. BY "seri-
Gus" is meant period when unem-
ployment exceeded per cent for
more than one month. or Z per cent
for any length of time.
In each of these five previous
periods. there was some artificial
development to which the situation
could be attributed. Two Of these
developments were automo bile
strikes; two were steel strikes. and
one was the period of post-Korean
conversion to defense. Since there
are no strikes now. and reconver-
sion from defense Is not slated to
begin until July, there is no such
artificial DEVELOPMENT in the pic
ture now. Yet unemployment stands
at Z per cent and is on the way up.
How far up?
The Michigan Employment Sc
curity Commission has projected it
as far as June-7.5 per cent. but
will go no further in making an
all-lnclusive prediction. However.
MESC officials acknowledge the
correctness of the following calcu-
lationS:
One Third Cutbock
The scheduled second-half pro-
duction cutback in passenger cars
amounting to 1873 per cent of
first-half production, would be re-
f1ected in a reduction of employ
ment in the auto industry of from
Is to q per cent. This could be
somewhere between 92.500 and 95.-
600 workers added to the idle list
after July /.
The defense truck cutbacks after
July l are expected to idle 10000
workers in the Detroit area. (This
estimate, made by MESC, is con-
CURED in by spokesman at the
Arrny's Tank-Automotive Center
here.)
Neither of these layoff estimates
includes the number of workers In
subassembly plants and other sup
pliers affected secondarily. Tank
Automotive Center predicts that the
layoff Of 10000 truck builders will
result in the idling Of $4,000 addi-
tional workers at subcontractors'
plants In Detroit alone. Some such
secondary layoff effect will be felt
in the passenger car category.
So, layoffs likely to occur after
July lon the basis of practicable
developments-could easily exceed
100000. This would indicate ap-
proximately 215,000 idle in the De-
troit area-or IA per cent of the
labor force-ignoring entirely those
idled as a secondary result of cut
backs.
# this comes to pass. Detroit will
be in real tailSpin. The highest
unemployment rate since World
War II was 12.9 per cent and that
lasted less than 30 days. % Q re-