The Chickasha Daily Express (Chickasha, Okla.), Vol. 53, No. 300, Ed. 1 Tuesday, January 22, 1946 Page: 5 of 8
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ESDAY JANUARY 22 1946
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to the President
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A Letter
of the
1
January 18 1946
Hon. Harry S. Truman
President of the United States'
The White House
Washington D. C.
Dear Mr. President:
Your proposal to me in Washington last evening that
the wage demand of the United Steelworkers of America-
CIO be settled on the basis of a wage increase of 1816
cents an hour retroactive to January 1 1946 cannot I
regret to say Jbe accepted by the United States Steel
Corporation for the reasons set forth below.
As you must be aware your proposal is almost equiva-
lent to granting in full the Union's revised demand of a
. . J . i " 0 '
wage increase of 1916 cents an hour which was advanced
by Philip Murray the President of the Union at our col-
lective bargaining conference with the Union in New
York a week ago today. In our opinion there is no just
basis from any point of view for a wage increase to our
steel workers of the large size you have proposed which
if put into effect is certain to result in great financial
harm not only to this Corporation but also to users of
steel in general.
.
J
As I have tried to make clear to you and other Gov-
ernment officials during our conferences in Washington
over the past few days there is a limit in the extent to
which the Union wage demands can be met by us. We
reached that limit when we raised our offer to the Union
last Friday from a wage increase of 1216 cents an hour
to one of 15 cents an hour. This would constitute the high-
est single wage increase ever made by our steel-making
subsidiaries. Our offer of 15 cents was equivalent to meet-
ing 60 of the Union's original excessive demand of a
$2 a day general wage increase. Our offer met 75 of
the Union's final proposal of a wage increase of 1916
cents an hour. A wage increase of 15 cents an hour such
as we offered would increase the direct labor costs of our
manufacturing subsidiaries by approximately $60000000
a year. That is a most substantial sum and does not take
into account the higher costs we shall have to pay for pur-
chased goods and services when large wage increases
generally become effective throughout American industry
as is inevitable after a substantial increase in steel wages.
As you know collective bargaining negotiations with
the Union broke down at the White House yesterday after-
noon because Mr. Murray then refused to budge from his
position that a country-wide steel strike must take place
' unless steel workers are granted a general wage increase
of 1916 cents an hour. Our offer of a wage increase of 15
cents an hour was again rejected by the Union.
i
The Union threatened to go ahead with its program
for a national steel strike ct midnight next Sunday al-
though such a strike will be a clear violation of the no-
strike provision contained in our labor contracts with the
Union which continue by their terms until October 15
1946. . V
From the outset we have recognized how injurious a
steel strike will be to reconversion and to the economy of
this whola country. Most industries are dependent upon a
supply of steel for their continued operations. We have
done everything reasonably within our power to avert such
a strike. If a strike occurs the responsibility rests with
the Union.
When the Government at the eleventh hour informed
us about a week ago of its willingness to sanction an
increase in steel ceiling prices we at once resumed col-
lective bargaining negotiations with the Union. Such a
price action by the Government was a recognition by it
of the right of the steel industry to receive price relief
because of past heavy increases in costs something which
the steel industry for many months has unsuccessfully
sought to establish with OPA.
I should like again to point out some pertinent facts
relative to the wages of our steel workers.
Since January 1941 the average straight-time hourly
pay without overtime of our steel workers has increased
more than the 33 increase in the cost of living during
-that period recently computed by Government authorities.
Steel workers' wages have kept pace with increased living
costs. Such average straight-time pay in our steel-producing
subsidiaries was $1.14 an hour in each of the months of
September October and November 1945 excluding any
overtime premium and any amount for correction of pos-
sible wage inequities. An increase of 15 cents in accord-
ance with our offer would raise such average straight-
time pay to $1.29 an hour placing such -pay among the
highest today in all of American industry.
Under our offer of a 15 cent increase the average
weekly take-home pay of our steel workers for a forty-hour
week Would amount to $51.60 assuming that no overtime
is involved. This figure is only $4.54 less than the actual
average weekly earnings of these employees including
overtime in the last full war year of 1944 when the aver-
- age work week was 46.1 hours. The difference is really
less because we will undoubtedly continue to have over-
time iii the future just as we have at the present time. In
November 1945 overtime premiums to our steel workers
aggregated more than $1300000. Such reduction of $4.54
in weekly take-home pay is the natural consequence of a
shorter work week of forty hours and therefore one of
lower production.
Much as we desire to avoid a steel strike we. cannot .
overlook the effect both on this Corporation and on our
customers and American business in general of the 1816
cent an hour wage increase which you have proposed.
Such a wage increase must result in higher prices for steel
than have previously been proposed to us by the Govern-
ment. Great financial harm would soon follow for all users
of steel who would be obliged to pay higher prices for
their steel higher Wages to their employees and still have .
the prices for their own products subject to OPA control.
Such a high and unjustified wage scale might well spell
financial disaster for many of the smaller steel companies
and for a large number of steel fabricators and processors.
The nation needs the output of these companies. In-
creased wages and increased prices which force com-
panies out of business can only result in irreparable
damage to the American peopl
In our judgment it is distinctly in the public interest
to take into account the injuriouseffect upon American
industry of an unjustified wage increase in the steel indus-
try After a full and careful consideration of your proposal
we have reached the conclusion above stated.
. t
Respectfully yours
Benjamin F. Falrless
President United States Steel Corporation
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' '
United States Steel Corporation
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The Chickasha Daily Express (Chickasha, Okla.), Vol. 53, No. 300, Ed. 1 Tuesday, January 22, 1946, newspaper, January 22, 1946; Chickasha, Oklahoma. (https://gateway.okhistory.org/ark:/67531/metadc1891338/m1/5/: accessed July 17, 2024), The Gateway to Oklahoma History, https://gateway.okhistory.org; crediting Oklahoma Historical Society.