Admiral Denebrink, who has said there is urgent need for the merchant marine; Admiral Leggett, who has said that the merchant marine today is approaching an area of vulnerability in mobilization of this country, who has said that the Russians are building like mad, not only in their own country, but contracting out in many of the European countries.

We want to say in regard to the statement made by Senator Butler on the floor of the Senate in regard to the purpose of this meeting and the time of this meeting, and also as to his opening statement this morning before this committee, that we subscribe to them fully, and that we believe it is an accurate and very pointed summation of the condition that exists in shipbuilding and ship-construction industries in the country today.

I do want to make a few other remarks in regard to the purpose of this meeting, but I would like to add that we have fully presented to this committee in a study made by us, a comprehensive study that took over a year, in which we have pointed up, pictured some of the ills that are prevalent in the industry and suggested some of the remedies that might be used to overcome and alleviate the situation of the United States merchant marine as it exists today.

Mr. WEBSTER. I would like the record to show we received that statement with a great deal of pleasure and we have, I think, quite a few copies for those who are interested.

I would assume, perhaps, that when we run out you might be able to afford the interested parties copies; is that right? Mr. PETTIS. Gladly, sir; yes. Gladly.

This statement before this Subcommittee on Water Transportation of the Interstate and Foreign Commerce Committee is a statement concerning the shipbiulding and ship-repair industry. As late as May 13, 1954, the monthly report of the Shipbuilders Council of America

stated

Mr. WEBSTER. May I interrupt there?

We are honored to have with us today representatives of the Maritime Administration, and I assume, as they undoubtedly did in connection with various points which Mr. Sanford, Mr. Strohmeier, and others raised, relating to the Maritime Administration, that they will bear these points in mind, and when they testify, we hope next Wednesday, they will at least have given thought and perhaps have reached conclusions on the specific points.

Mr. PETTIS. We would hope the same thing, Mr. Chairman, because we are under difficulty in regard to this in the reactivating of some of the ships for the various foreign-aid programs and also for the Korean situation. Many of the boats-the shipyards were of such distances away from the reserve fleet and the towage costs would have to be included, that they just weren't able to compete with other yards, and that is not a good, sound program for the mobilization situation."

As late as May 13, 1954, the monthly report of the Shipbuilders Council of America stated that the order book of the United States coastal and Great Lakes shipyards fell below 500,000 gross tons the month of April, for the first time since March 1951. There had been no new contracts for commercial vessels of 1,000 gross tons and over for 11 years.

As you doubtless know, unless drastic action is taken by this session of the Congress relative to the merchant marine, only 2 private mer

chant vessels will remain to be constructed in private shipyards of this country by the beginning of 1955. Not a single private merchant ship will be left on the ways in shipyards after that time.

Our present merchant fleet is inadequate for national defense because it is becoming obsolete en bloc. We are decimating the American shipbuilding and ship-repair industry to a point where it will not be able to expand to meet the full needs of war.

By July the Sparrows Point shipyards of the Bethlehem Steel Co., the yard which built the most merchant tonnage of any yard in 1953, will be ready to close. Most of the small yards will be shut except those which are lucky enough to have some Navy work.

From the beginning of 1953 to the beginning of 1954 the backlog of shipbuilding work has declined by close to 50 percent.

Employment in the shipyards, in repair as well as new construction and conversion, is declining rapidly. Although men remain on the payrolls of the repair yards, they are lucky if they are obtaining one or two days' work per week.

Emergency action is indicated if we are to prevent, to quote Senator Butler, "almost total collapse of the vital shipbuilding industry in this country."

Senator Butler, in a speech delivered in the United States Senate this past week, suggested ship repair and conditioning of the reserve fleet as a program which will keep the industry going for a short time until major work can be obtained.

Twice before in the Congress of the United States, in 1949 and again in 1950, we have testified on the depressed condition of the shipbuilding and ship-repair industry. In 1950 we came before a similar subcommittee of this committee, in the 81st Congress, 2d session, calling for a $25 million ship-repair appropriation which failed to achieve passage during the 1st session of the 81st Congress, to repair 134 vessels in the reserve fleet then immediately required for national defense.

In the Review of the Maritime Subsidy in the Light of the Present National Requirements for Merchant Marine and Shipbuilding Industry, presented to the subcommittee in early May of 1954, the Under Secretary of Commerce for Transportation stated that of 2,055 merchant-type ships in the reserve fleet as of November 30, 1953, only 664 will require little or no delay in reactivation for repairs if they are again needed for service.

Of the 1,951 ships remaining, 97 require major repairs in addition to normal reactivating expenses-repairs of over $100,000-763 require repairs of less than $100,000 in addition to reactivating expenses. The rest require normal reactivating expense only.

The report goes on to state:

Much has been written about the shrinkage of the repair industry and its effect in an emergency. Probably the most serious effect will be the loss of skilled workers and supervisors upon whom the ability to rapidly expand would depend. Work projects designed to bolster the economy could well include a program for the modernization and repair of reserve fleet ships.

History is repeating itself in such fashion as to be almost frightening. This was almost the same sort of report on the reserve fleet as that submitted to the Senate in 1949 and 1950 just before the Korean

emergency.

Are we again to be caught unprepared before another emergency?

We would particularly desire this committee to remember that the moneys for the repair of the vessels in the reserve fleet should be allocated, so that towage charges will not be considered as part of the competitive bids for the work on each specific coast. The vessels which require repair are situated in specific reserve fleet sites, in bulk. If towage charges are considered as part of the competitive bids, these vessels, by mere position, would all be allocated to one specific yardor two at the most-on each coast, because the towage charges to get the vessels to the other yards would be so much as to negate any possible low bid, which a shipyard in another port would make.

Therefore, we would request that this committee, before passing upon the amount of the appropriation required for the repair of the vessels, request the Maritime Administration to estimate the cost of towage charges and to add this estimate to the appropriaion which will be required. The shipyards were of such distance away from the reserve fleet and the towage costs would have to be included, that they just weren't able to compete with other yards, and that is not a good, sound program for the mobilization situation.

Otherwise, this committee will find itself in the position of having requested an appropriation of moneys which will, at the very most, serve to keep only 1 or 2 yards on each coast in operation. This would not serve the purposes of preserving the necessary vessels and it would not alleviate the condition of mass unemployment in yards in this country.

Fortunately, the vessels are so scattered between the three coasts, the Atlantic coast, the Pacific coast, and the gulf coast, that there will be no need to worry about towage cost from one coast to another. There will, however, be need to allocate moneys for towage from one section of a coast to another.

Intermittency of employment has been a concomitant of work in the shipbuilding and ship repair industry. We do submit, however, that very few people realize just how intermittent this employment is. In 1952, during the last management negotiations, the Bethlehem Steel Co. provided the union with information respecting average weekly hours worked during the five years, 1946-50, in its Atlantic coast shipyards. These shipyards include two major ship construction yards: Fore River at Quincy, Mass., and Sparrows Point at Baltimore, Md. The average weekly hours worked in these yards are much higher than in repair yards, and the Bethlehem Steel Co.'s average weekly hours worked should be much higher than those, for example, in the exclusively repair yards of Todd Shipyards Corp., and Maryland Dry Dock Corp. In each of the years above mentioned, the average hours worked were less than 34 per week.

We have here some figures of comparison, with those worked in building trades and durable goods manufacturing, during the years 1946 and 1952. We think they will be of some benefit to this committee in working out its program and showing the employment in the industry, even in normal times.

Mr. WEBSTER. I am sure they will be.

Mr. PETTIS. This intermittency is not a phenomenon peculiar to a single era of time in this industry. It is a constant characteristic. Mr. WEBSTER. I believe it would be well to incorporate those figures in the record at this point.

(The information is as follows:)

Comparison of average weekly hours worked in Bethlehem with those worked in building trades and durable goods manufacturing, 1946–52

Mr. PETTIS. As I said, this intermittency is not a phenomenon peculiar to a single year or time in this industry. It is a constant characteristic. Today, this intermittency is even worse than before. The average age of workers in the shipyards, who comprise the nucleus of skilled employment in these yards, is such that if these men once are forced completely out of the industry by a closing of the yards they will be too old to come back if the yards should open again in a few years. Most of them will either retire or find other jobs which they would be reluctant to leave for the intermittent type of employment which they have obtained from the yards during the past few years.

Contrary to common belief, it is not true that a simple employment of one-twelfth of the normal work force in a shipyard means that the shipyard will be capable of expanding to the normal work force within a few months.

This ratio of 12 to 1 has been used so frequently that we have lost sight of the fact that it is really meaningless.

The ratio may be correct as far as certain departments are concerned, but it means absolutely nothing in the case of the more skilled and apprenticed crafts. The ratio of 12 to 1 does not mean anything in the moldloft. Good loftsmen take years to train, and apprenticeship is simply the beginning of training for a loftsman. To make a first class loftsman can often take as long as 7 to 10 years.

The loftsmen in this industry are now mostly elderly men. Apprenticeship was interrupted during the war, and the numbers of apprentices today, because of the lack of work in the yards, are insufficient in case any future emergency should occur.

The same thing is true of coppersmiths and pipefitters or marine plumbers. Marine steamfitters and plumbers in 3 months! One cannot train a coppersmith in 3 months. One cannot train any marine steamfitters or plumbers in 3 months. These men take years to develop the necessary skills required for the building of complex ships. The same thing is true of outside machinists. The main bottleneck in the development of a shipbuilding program during the national

emergency was the shortage of outside machinists. These men take years to develop their skills. Although the work has been broken down in this department to some extent, there is still required, for the proper functioning of the shipyard, a nucleus of trained men to make sure that the semiskilled men in the department are doing the work correctly. The installation men in this department take years to train.

Again this is true of shipfitters; the shipwrights, the oldtimers in the industry call them. This work has also been broken down to a certain extent, but those men who actually do the assembling in the shipfitting craft cannot be trained in a matter of months or even in a matter of years.

It is true of the blacksmith shop, of the boiler shop, and of the forge. During the preceding war, the War Manpower Commission issued an industrial manning table for the shipbuilding industry. It is unusual to see how many of the skills in the industry take over 2 years to acquire minimum competence, even in a wartime accelerated training program. When we mention minimum competence, we are not discussing first-class men. We are discussing training to accomplish the minimum requirements for mechanics' work in these crafts.

The actual mechanics who formed the nucleus of shipyard skills during the Second World War have had 5 years in which to acquire training in their crafts, from 1936 to 1941. They are today mostly composel of older men. The age average in the shipyards for the nuclear forces is approaching men with 25 years or more of average seniority.

This is particularly true in the new construction yards and in the small nuclear forces of the repair yards. In some departments the seniority average is well up over 25 years of seniority. Here, we are discussing the average seniority of skilled workers. If the industry is allowed to die within the next 5 years, with no possibility of replacement training, it will not be possible to start it again within a period of from 5 to 7 years of on-the-job training in most of the building and repair yards in the country.

The rapid expansion required for the shipyard forces in America during the Second World War and the facilities it was necessary to construct cost us well over one-half billion dollars in facilities, wasted manpower, and training programs. In addition to this, the cost of building a fleet which would not be usable in peacetime is difficult to measure, but we would venture to say that close to $5 billion worth of unusable merchant ships were constructed because of the emergency, and the fact that ships had to be built quickly by mass production methods, with no time to construct a fleet which would be usable in peace as well as in war.

If Congress and the administration were to allow an adequate shipconstruction program at the same time as allowing the preservation and repair of the reserve fleet, in time we would be able to scrap the obsolete Liberty ships in the reserve fleet, and have a reserve fleet capable of meeting any emergency.

We wish to say, Senator Butler, that you have properly christened this emergency program as Operation Emergency.

Senator BUTLER. We thank you ever so much, for that fine state

ment.

Mr. PETTIS. You are entirely welcome.