Special Message to the Congress Transmitting Reorganization Plan 1 of 1948.

To the Congress of the United States:

I transmit herewith Reorganization Plan No. 1 of 1948, under the Reorganization Act of 1945, which transfers the United States Employment Service and the Bureau of Employment Security to the Department of Labor. The United States Employment Service is now in the Department of Labor by temporary transfer under authority of Title I of the First War Powers Act, 1941, while the Bureau of Employment Security is at present a constituent unit of the Federal Security Agency. This plan will place the administration of the employment service and unemployment compensation functions of the Federal Government in the most appropriate location within the Executive establishment and will provide for their proper coordination.

I find that this proposed reorganization is necessary to accomplish the following purposes of the Reorganization Act of 1945: (1) to group, coordinate, and consolidate agencies and functions of the Government according to major purposes, (2) to increase the efficiency of the operations of the Government, and (3) to promote economy to the fullest extent consistent with the efficient operation of the Government.

The United States Employment Service was established in the Department of Labor by the Wagner-Peyser Act in 1933. It was later transferred under Reorganization Plan No. I, effective July 1, 1939, to the Social Security Board in the Federal Security Agency. After the creation of the War Manpower Commission, the United States Employment Service was placed under that Commission by Executive Order No. 9247 of September 17, 1942. Shortly after the Japanese surrender the Service was transferred to the Department of Labor by Executive Order No. 9617. Both of these transfers were made under the temporary authority of Title I of the First War Powers Act.

The provision of a nation-wide system of public employment offices, which assists workers to get jobs and employers to obtain labor, belongs under the leadership of the Secretary of Labor. Within our Federal Government the Department of Labor is the agency primarily concerned with the labor market and problems of employment.

The Department of Labor already has within its organization many, but not all, of the resources needed for the full performance of this role. It has a broad understanding of working conditions and the factors in labor turnover. Through the Bureau of Labor Statistics, it develops extensive information on the long-term trends in employment and on the occupational characteristics of the labor force. Through the Apprentice Training Service it promotes the development of needed skills. I consider it necessary and desirable that these facilities of the Department of Labor should now be augmented by the other major operating agencies in the field of employment--the United States Employment Service and the Bureau of Employment Security. These agencies are concerned, as is the Department of Labor, with the full and proper employment of American workers.

The results achieved by the Employment Service after more than two years of operation within the Department of Labor strongly justify the decision to place these functions permanently within that Department. More employers are now using the facilities of the public employment offices than ever before in the history of the peace-time Employment Service. More services are being furnished employers by the public employment offices than ever before. Today the public employment office has become the central labor exchange in the community and the primary source of information on employment opportunities and immediate labor market trends.

The Bureau of Employment Security in the Federal Security Agency administers the Federal activities relating to the nationwide unemployment compensation system. As a practical matter these functions have proved to be intimately related to those of the United States Employment Service. Under existing state laws, claimants for unemployment compensation must register with the Employment Service before they may become eligible for benefits. In consequence nearly all states have assigned the administration of these two programs to the same agency.

Both the employment service and the unemployment compensation system are concerned with the worker as a member of the labor force. Both are concerned with shortening the periods of unemployment and with promoting continuity of employment. When the worker becomes unemployed, the alternatives are either to assist him in obtaining new employment or to pay him benefits. The proper emphasis is on employment rather than on benefit payments. This emphasis can best be achieved by having the two programs administered in the agency most concerned with the employment process--the Labor Department.

By reason of the reorganizations made by this plan, I find that the responsibilities and duties of the Secretary of Labor will be of such nature as to require the inclusion in the plan of provisions for the appointment and compensation of a Commissioner of Employment to coordinate the employment service and unemployment insurance activities within the Department. The plan also provides that the Federal Advisory Council, a group representative of labor, management and the public, authorized by the Wagner-Peyser Act, shall advise the Secretary and the Commissioner on the operation of both the unemployment compensation system and the United States Employment Service.

HARRY S. TRUMAN