The Human Costs of Unemployment

Fewer than 15 per cent of today’s 200 million people were adults in 1930 at the onset of the Great Depression of the 1930’s. Thus, most of today’s Americans have no memory of that period and its devastating impact on human morale and well-being, as well as on the aggregate production of the economy.

FIG. 10-2 Unemployment soars in depressions, and even
in recessions. What is a reasonable minimum level of un-
employment for us to shoot at? (Source: U.S. Deportment
of Labor.)

Figure 10-2 presents the cold statistics. Unemployment reached a peak of approximately 25 per cent of the labor force in 1933, and it averaged between 15 and 20 per cent for the entire decade of the 30’s. Moreover, it must be remembered that many of the people employed were on a part-time basis at drastically reduced rates of pay, and there were millions of “hidden unemployed” barely eking out an existence in agriculture. At the bottom of the depression surely not more than two-thirds of the total labor force had regular fulltime jobs, and some estimates put the figure nearer one-half.

But statistics are bloodless things. Listen to the testimony given by an economist before a Senate subcommittee investigating unemployment in 1932:

Mr. deSchweinitz: When I appeared before the subcommittee last December, I stated that there were 233,000 persons out of work in Philadelphia.

There are now 298,000 persons out of work. . . . In December I told you that 43,000 families were receiving relief, today 55,000 families are receiving relief.

In December, our per family grant was $4.39 per week per family. It is now $4.23 per family. Of this $4.23 per family, about $3.93 is an allowance for food. .

I want to tell you about an experience we had here in Philadelphia when our private funds were exhausted and before public funds became available.

There was a period of about 11 days when many families received nothing from us. We have received reports from workers as to how these families managed. The material I am about to give you is typical, although it is based on a small sample.

One woman said she borrowed 50~ from a friend and bought stale bread for 3ฝ~ per loaf, and that is all they had for 11 days except for one or two meals.

One woman went along the docks and picked up vegetables that fell from the wagons. Sometimes the fish vendors gave her fish at the end of the day. On two different occasions this family was without food for a day and a half.

The gas company was careful not to turn off gas in a great many of these families, so in some instances food could be cooked.

Another family did not have food for two days. Then the husband went out and gathered dandelions and the family lived on them.

I should also like to say that when we talk to people to ask about unemployment, they say, “Well, people manage to get along somehow or other, don’t they? You do not have very many people who really drop dead of starvation.” That is true. Actually, death from starvation is not a frequent occurrence.

They live on inadequacies, and because they live on inadequacies the thing does not become dramatic, and we do not hear about it. Yet the cost in human suffering is just as great as if they starved to death overnight.

Now listen to the testimony of another witness, given before a House subcommittee at about the same time.

Mr. Ameringer: The last thing I saw on the night I left Seattle was numbers of women searching for scraps of food in the refuse piles of the principal markets of that city. A number of Montana citizens told me of thousands of bushels of wheat left in the field uncut on account of its low price that hardily paid for the harvesting. In Oregon I saw thousands of bushels of apples rotting in the orchards. Only absolutely flawless apples were still salable, at from 40—S04 a box containing 200 apples. At the same time, there are millions of children who, on account of the poverty of their parents, will not eat one apple this winter.

While I was in Oregon, the Portland Oregonian bemoaned the fact that thousands of ewes were killed by the sheep raisers because they did not bring enough in the market to pay the freight on them. And while Oregon sheep raisers fed mutton to the buzzards, I saw men picking meat scraps in the garbage cans in the cities of New York and Chicago. I talked to one man in a restaurant in Chicago. He told me of his experience in raising sheep. He said that he had killed 3,000 sheep this fall and thrown them down the canyon because it cost $1.10 to ship a sheep, and then he would get less than a dollar for it. He said he could not afford to feed the sheep, and he would not let them starve, so he just cut their throats and threw them down the canyon.

The roads of the west and southwest teem with hungry hitchhikers. The campfires of homeless are seen along every railroad track. . . . Between Clarksvifle and Russeliville, Arkansas, I picked up a family. The woman was hugging a dead chicken under a ragged coat. Wrhen I asked her where she had procured the fowl, first she told me she had found it dead in the road, and then added in grim humor, “They promised me a chicken in the pot, and now I got mine.”

Most American families were not in such desperate straits. But fear was everywhere. In every American city, hordes of families were evicted from their apartments, often moving in with other families until ten or twelve people would be sharing three or four rooms, often shivering through the winter in heatless houses because they could afford little or no coal. Many fought to maintain respectability. Clerks put pieces of cardboard inside their shoes before setting out on endless job-hunting rounds; previously well-to-do families wiped out in the stock-market crash struggled back to get poorer jobs and to use part of their drastically reduced incomes to pay on their debts. But for many, long-continued failure wiped out self-respect and the will to try. Parks were sprinkled with desolate men in shabby clothes, merely sitting. Many more of them remained home.

John Steinbeck pictured the plight of thousands of migrant workers in his The Grapes of Wrath, a story of the bitter despair as families, pushed off their land by poverty and the great dust storms of the 1930’s, wandered through the Southwest, looking for work anywhere, scraping by on almost nothing in their battered jalopies, homeless and often pursued by the police and “respectable” citizens in communities that did not want them.

These are the costs of massive unemployment and depression. Such conditions are hard to imagine today. Perhaps another great depression will never come; let us hope not.

Is such evidence on the human cost of unemployment relevant today? Today, unemployment is far more modest even at the depths of our postwar recessions. Nationwide unemployment insurance provides temporary financial support for regular workers laid off. Government relief payments help others. Many unions have obtained private unemployment compensation plans to supplement government benefits. But at best, these provide only a fraction of regular wage incomes, and all have time limits, often as short as 13 weeks. Moreover, to receive unemployment insurance benefits, one must have held a regular job, and hundreds of thousands of unemployed persons fail to qualify on this test. The impact of modern unemployment is far less devastating now than during the desperate days of the 1930’s. But in the depressed areas—for example in the soft coal fields of the Appalachians—many workers have been out of jobs for years. Discouragement, and then despair, take over when no job is available week after week and month after month.

Moderate unemployment in the postwar recessions has weighed very unevenly on the population. Most mature, skilled workers have retained their jobs, or found. others quickly if they are laid off. The unskilled, the uneducated, the nonwhites, and young people without experience have borne the brunt of unemployment. In 1964, a typical year when total unemployment was less than ‘6 per cent for the nation, the unemployment rate among nonwhites was 11 per cent; among jobseekers under age 20 it was 16 per cent, In Chicago at mid-1964, Negroes accounted for 13 per cent of the total labor force, but for over 40 per cent of the unemployed. Moreover, in 1964, a reasonably prosperous year, there were over 2 million workers unemployed so long that they had exhausted all their unemployment compensation benefits, and the figure was growing by over 40,000 a week. The human costs of unemployment are real. It is of little solace to the unemployed worker that aggregate unemployment totals only 5 per cent of the labor force if he has no job and little hope of finding one to support his family.