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a) Private Employment Agencies.

b) Labor Bureaus Not Operating F'or Profit.



48 REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT

PRIVATE EMPLOYMENT AGENCIES IN CHICAGO

On March 29, 1912, there were in operation in Chicago, 249 private em-
ployment agencies, which charged fees for positions and consequently were
licensed. These agencies deal principally with the following kinds of help:

No. of Agencies

Domestic (including restaurant and hotel help) 81

Labor (including a few skilled laborers) 59

Theatrical 41

General (all kinds of labor, both sexes) 17

Clerical and mercantile 18

Nurses 13

Teachers 8

Hotel and restaurant 6

Barbers , 3

Printers 1

Architects 1

Choir 1

Total 249

In addition there had been licensed during the year ending April 1, 1912,
seventeen other agencies which had ceased or never begun operations; the
general explanation of this fact is the lack of success of such agencies.

Within each of the classes of agencies mentioned above there is generally
considerable specialization; some of the domestic agencies deal almost ex-
clusively with private families; others almost entirely with one line of restau-
rants or hotels; others with clubs. Some of the mercantile agencies deal
almost entirely with the positions requiring considerable clerical skill 'and
paying more than $1,000 a year; others deal principally with positions that
pay $6 to $14 a week. The Greafr Northern Railway Labor Exchange hires
men only for the Great Northern and Burlington railways. Some deal almost
exclusively with one nationality.

A more detailed description of the methods used, the efficiency and the
fees of these classes of agencies is given. This is based on an investigation
of a few agencies of each kind.

A. Labor Agencies : The labor agencies deal almost entirely with un-
skilled labor ; most of these agencies are situated on Canal Street and on Madi-
son near Canal. There are a few agencies which deal with more skilled labor,
situated in the loop district; most of the skilled laborers, however, secure
their positions through their trade unions or by newspapers or personal
solicitation.

The positions to which the laborers are sent are principally in railway
and construction work; a great part of this is outside of the city. Mr. Clapp
of the firm of Clapp, Norstrom and Riley, stated that a restriction of immigra-
tion would be disastrous to the industry of the country; when anything is
moving now it is almost impossible for the labor agencies to secure laborers
enough to supply the demands of employers. Mr. Dodge, who is an agent of
the Tennessee Coal, Iron and Railway Company of Alabama, stated that in-
dustry in that region, and in other regions also, is starving for labor. It is
impossible to secure help enough. Mr. M. T. Todorovich of the International
Labor Agency, stated that he had had a standing order for two years and a
half for all the laborers he could send to the West, and that he was not able
to send nearly enough. Most of the industries in which this scarcity is found
have wages fixed at about $1.50 a day. The work is done almost entirely by
foreigners; the Americans are not sent out on such work (1) because they
would leave the work at harvest time for better wages. (2) they will not
board themselves as the foreigners will, (3) they complain about the condi-
tions of work. '(4) they are more likely to misuse the transportation given to
them. Several agents stated "Show me an American laborer, and I will show
you a bum."



REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT 49

There are various methods used by these agencies to secure work. Some
of them are evidently offices of railway .companies. The Great Northern
Railway Labor Agency secures all the labor for the Great Northern and the
Burlington routes, either directly or through other labor agencies when it
cannot secure enough directly; it does no other work than the hiring of men
for these two systems. Mr. Stamidtetus is reported to have secured a right
to place all laborers on the Northwestern system, in return for which he guar-
antees the Northwestern road that the laborers will pay at least $75 r OOO a year
in transportation. This work on the Northwestern is sublet to other agencies
to a very great extent; the Great Northern Railway Labor Agency does not
sublet its contracts until it is unable to secure laborers enough. The other
labor agents are much more ready to co-operate with the Stamidtetus agencies,
because they thus have a chance to place men on the Northwestern system
in the good as well as the bad seasons. When these contracts are sublet,
the fees are divided between the agencies concerned.

In addition to such standing contracts with firms or contractors, there
have been built up personal attachments and reputations, which are influ-
ential in securing contracts to fill positions.

There are also charges that the labor agents secure such contracts by
payment of part of the fees to the boss or foremen who hire the men for
the firm.

The labor exchanges advertise, and circularize in order to secure and
keep th&ir trade. They make very great efforts to secure the men that are
demanded by the employers; frequently the fees are remitted in order to se-
cure laborers enough to meet the demands; sometimes transportation, is paid,
meals given and other means, which will be mentioned below, used in order
to secure laborers enough. The principle of their business is to secure labor-
ers at any cost in order to hold the trade of the employers. The employers
do not pay any fees for this service, but they are the ones whose trade must
be held.

The method of getting men is really an indirect method ; it is done largely
through interpreters; if an agency has an opening for 50 men in railway work,
the agent sends for the interpreter of some gang; it is generally reported
that he offers a certain amount to the interpreter for a gang of 50 men; this
may be 50c a head, or $1.00 a head or even more. The interpreter then picks
up the 50 men 4 if satisfactory conditions are secured, takes them to the agency
to sign the contract and secure numbers, conducts them to the stations and
manages their transportation for them. This interpreter may change the
entire gang in a short time in order to secure another fee; frequently a gang
will work through the entire summer without a change. The work generally
lasts from April to December.

When the interpreters known to the agents have all gone out with their
gangs and other demands for laborers come in to them, they have to make
vigorous efforts to secure men. Most railroads refuse to accept "white men"
for their construction work. A few scattered foreigners can be secured by
personal solicitation, but generally not nearly enough. Mr. M. T. Todorovich,
of the International Labor Agency, stated that he had fourteen solicitors in
the field last summer attempting to secure laborers: these solicitors go to the
gangs on other railroads and 'steal' them if possible; if they cannot get them
thus, the solicitors go to the east or south and bring laborers; he may need
to go to New York, Pennsylvania, New Orleans, or some other parts of the
United States, but he secures the men, if it is possible to secure them at any
cost. When men are brought from the mines or factories of New York or
Pennsylvania or other states, the agent advances their transportation to Chi-
cago, feeds them on the way, gives them the job without office fees, gives
them free transportation to the place where they are needed, and uses any
other means possible to get them. The following figures show what was
done in one agency in the last two years:



50 REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT

Men Placed by Clapp, Norstrom and Riley.

In the year ending Nov. 1

1910 1911

Foreigners without fees 370 157

Foreigners with fees 7,184 5,199

Total foreigners 7,554 5.356

"White men" without fees 2,288 3.679

"White men" with fees 10,066 6.482

Total "white men" 12,354 10.161

Total, all men placed 19,908 15,517

Thousands of dollars are advanced for transportation; most of this is to
foreigners; the reason it is not advanced to "white men" is that the Ameri-
cans cannot be depended on to do the work when they reach the destination.

The fees charged depend entirely on the supply of labor accessible. It
is as high as $15 at some times; in other seasons there is no fee. The most
usual fees are $4 to $6 in the spring, and $2 to $4 a little later. The average
fee of Clapp, Norstrom and Riley in 1910 was $1.36. In the spring the men
have to pay the cost of transportation; this generally amounts to not more
than $4 east of the Missouri River, and a flat rate of $6 for all places west of
the Missouri River. They get the same rate back if they work for six months.

The expenses of the labor office of Clapp, Norstrom and Riley are about
$600 a month; by the Great Northern Railway Labor Agency, abofft $200 is
spent for rent alone each month, though the office is practically useless dur-
ing the months from December to March.

There is no co-operation between the labor agencies in Chicago and those
in other cities. The reasons for this, as given by the agents, are that they
do not have confidence in the other agencies, and they can get the help they
require more cheaply by sending a solicitor after it than by dividing fees
with other employment agencies. Two of the agencies have branch offices
in other cities; these are the Great Northern Railway Labor Agency and the
Clapp, Norstrom and Riley Labor Agency; the first has other agencies in St.
Paul, St. Louis, Kansas City, Seattle, Spokane and Portland; the second has
a branch agency in Minneapolis.

B. Domestic Agencies : The employment agencies which are principally
for unskilled women are generally known as domestic agencies; this does not
mean that they place women only in domestic positions, for in many of these
agencies there is specialization on clubs, or restaurants. The agencies furnish
kitchen girls, dish washers, scrub girls, dining room girls, etc. Many of these
do not make much more than enough to pay for the license; such agencies
are conducted in the home of the agents and as part of the household duties.
There are other domestic agencies which have been very successful financially.

The methods of coining in contact tvith the employers are to send letters
and circulars to managers of clubs, restaurants and hotels; to answer news-
paper advertisements for the girls who want work; personal solicitation; ad-
vertisement of the agency in the papers. They depend very largely on the
reputation that has been established. Most employers call on the agencies to
secure help; the agency which becomes known is the one called on. Some-
times an agency secures a contract to place' all the female help required in a
number of restaurants which are under the same management. Charges are
made that such contracts are bought. There are charges, also, that when such
contracts are secured by an agency, the women are changed every few weeks
in order to secure the additional fees.

The methods of securing the female help are personal solicitation, adver-
tisements in newspapers, and establishing a reputation. For the most part
the girls come to the agencies and not many efforts are made to secure the
girls. There is almost always a surplus of demands for girls for domestic
work in private homes.

/>('. are generally $1 or $2 for registration of girls. This frequently
means that two or three positions must be secured for one girl on the one
registration. The girl may not like the first position offered, may think it is



REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT 51

too far from home, or the hours unsuitable, etc. One firm made a definite
offer to give three jobs for one registration. For private positions some
agencies also charge the family a fee of from $2 to $10. There are complaints
that some agencies merely charge fees for registration and then make few
efforts to place the girls who have registered; the fees must be returned, in
such cases, after thirty days; but many who have registered do not come
back for their fees.

One element in the expense of this kind of agency is the cost of conduct-
ing the girls to the positions; many of the foreign girls are unable -to find
their way to ihe places vacant; one agency has two girls who are trained to
conduct several girls around to the various vacancies; almost all the agencies
which deal with foreign girls have to make similar provisions. The agency
generally pays the carfare in such cases.

It is not possible to estimate the expenses of such agencies, but they are
not very great; the rent' and advertising cover most of the expense.

C. The hotel agency differs from the domestic agency in dealing exclusively
with hotels, clubs and restaurants, and in including both male and female help.'
There are six agencies of this sort in operation in Chicago.

The hotel agency comes in contact with the employers by advertisements, cir-
culars, personal solicitation, etc. Mr. Lawlor, the manager of the Chicago Hotel
Employment Agency, stated that he had been manager of a hotel for several years,
and that he attended a great many of the meetings of hotel associations for the
purpose of keeping in touch with the hotel managers. Close attention to the de-
mands and desires of the hotels is the only way of keeping the trade of hotels. Most
of the work done by such agencies is outside of Chicago ; the hotels and restaurants
in Chicago secure their help through the domestic agencies and the trades
unions.

The reputation of the agency is the principal means of securing the help; the
hotel employees change their positions almost every spring; this is of advantage
to the hotel agencies for they thus secure a supply of applications for the summer
resorts and out-of-town hotels with which they deal ; if help cannot be secured in
other ways, they are "stolen" from local hotels.

The fees depend on the salaries paid ; they vary from 10% to 25% of the first
month's salary; for a salary of $100 the fee is generally 10%. The transportation
charges are advanced to the employee, and then taken from the wages : this is a
source of considerable loss to the agency, for many of the employees secure trans-
portation to a position, and then do not take it.

There is much more expense attached to such an agency than to the domestic
agencies ; there must be much correspondence, many telegrams sent, outside solicita-
tion and advertising.

There is no co-operation with similar agencies in other cities.

D. Clerical and Mercantile Agencies: The clerical and mercantile agencies
are of two rather distinct classes: (1) those that deal with the more skilled em-
ployees, who can command salaries of more than $1,000 a year, and who are gen j
erally employed when they apply to the agency; (2) those that deal with the cheaper
positions, filled by clerks who receive less than. $1,000 a year, and who are generally
unemployed when they apply to the agency. Many of the positions of the first kind
are outside of Chicago and even outside the state ; most of the positions of the latter
type are in Chicago. The positions of the first kind require a very careful investiga-
tion of the record of the applicant to obtain information on the basis of which
recommendations can be made ; the employees of the latter type are investigated in
only a superficial way ; this investigation is generally supplemented by an investiga-
tion made by the employer who intends to hire the applicant.

The agencies of both kinds have a rather high development of methods of learn-
ing the needs of their trade; they have offices in the loop; they generally have sev-
eral telephones in the offices ; they have a number of solicitors investigating the
positions and the employees. The Business Service Company co-operate with sim-
ilar offices in Cincinnati, Denver, St. Louis, Minneapolis and a few other cities.
This firm refuses to permit the cheaper clerks to register, because employers might
doubt the efficiency of the office, if such clerks were seen in the waiting room.

The employees are secured by telephone, and by correspondence, by advertising
in newspapers and by personal solicitation. If a firm makes a request for a clerk,



62 REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT

the agency attempts to find such a man ;' it makes no difference whether the man
is already employed or not, though the employed man has the benefit in some cases ;
if the agency can find the man required, they attempt to induce him to take the po-
sition which is open. There are some agencies which refuse to take applicants who
are already employed ; they are not able to secure satisfactory references from such
persons, because of the danger of losing the position held at the time.

Fees: The fees for the better positions are generally 60% of the first month's
salary in addition to a fee of $2 for registration ; the fees for the cheaper positions
are generally one week's pay if the job lasts six weeks or more; if the work is tem-
porary, the fee varies from one-tenth to one-sixth of the amount received. If the
position is out of town, the transportation is sometimes advanced; sometimes the
employer pays this transportation.

There is a great deal of difficulty in collecting these fees ; the agencies which
deal with cheaper help are able to have the wages assigned to them, but the other
agencies do not follow this course, (1) because it would show that the agency did
not trust the men whom they were recommending, and (2) because they do not wish
to bother the employers. One firm has over $4 ( 000 on its books now in fees due.
Many of the applicants who are referred to vacant positions do not apply for the
positions; this gives the agency a bad reputation, and causes a great deal of difficulty;
man}' persons who are placed in the cheaper positions do not hold them long ; one
firm estimated that the average position was held for about six months. King's
Mercantile Agency has more trouble with the employers than with the employees ; a
firm calls up several agencies and gives an order to each ; each agency sends a man
and the first satisfactory man who reaches the office gets the position. Charges
are made that some of these clerical agencies place large advertisements in the
newspapers, and secure a great many applications from the unemployed,
when they really have few positions which they can fill; each applicant regis-
ters and pays a fee of $2.00; this fee cannot be returned for thirty days unless
the agency chooses to pay it back sooner; many of the applicants do not take
the trouble to secure the return of their fee, though they consider the practice
unjust.

Mr. King stated that he did not co-operate with offices in other cities, because
nine-tenths of them are bad.

The expenses of these mercantile offices are generally high ; the rent is generally
from $200 to $500 a month ; several of the offices have five or six telephones each ;
the expenses of the work outside the city are very great ; the Business Service Co.
recently spent $18 in telegrams in regard to one position ; the cost of securing in-
formation on which to base recommendations is great.

E. The general employment exchange is a combination of the labor agency
and the clerical agency ; it deals with both men and women. They have a great
deal of work in skilled trades, also. The La Salle Employment Agency and the
American Employment Association are examples of this kind of agency. There is
nothing in their methods that differs from the methods in the agencies described
above. Their fees are generally either a flat rate of $5 for any position, or else
a percent of the first month's salary, with $5 as a general maximum. Many of
these fees are never paid. In the La Salle Employment Agency there are hardly
ever enough women to satisfy the demands for domestic and clerical positions, and
in both the La Salle Employment Agency and the American Employment Associa-
tion, it has been possible, according to the statements of the managers, to secure,
either immediately or within three days, work of some kind for any applicant who
wanted to work ; they state that most of their applicants who do not secure work
fail because ,they do not want to work, or else because they are .too particular
about the conditions of work, refuse to work at night, or at the wages offered,
or at the kind of work offered.

Each of the agencies mentioned above has seven or eight telephones ; each
morning the telephone operator calls up the regular patrons of the agency and
asks if men or women are wanted, the nature and conditions of the work, etc.
These agencies have developed the technique of their business more than the regu-
lar labor or domestic exchanges have.

F. Teachers' agencies are engaged in business which is mostly interstate : the
applications are located in every state in the Union, and positions are filled in every
state. About one-tenth of the applicants secure positions ; this small percentage is
due to the fact that many applicants register at several offices, many secure posi-



REPORT OF THE MAYOR'S COMMISSION ON UNEMPLOYMENT 53

tions through their own efforts; and many go into other occupations. Such work
requires considerable advertising among school officials and prospective teachers.
In these agencies ten to fifteen clerks are generally employed. The total expense
of the Thurston Agency for a year is about $13,000. The ordinary fee is 5% of
the first year's salary, plus $2 registration fee ; the Thurston Agency has almost
entirely done away with this registration fee in order to increase the number of
applicants.

G. Theatrical agencies are more than employment agencies ; they not only se-
cure the initial position for actors, but have the entire management of the act
during the season, keep it moving from one theatre to another, the theatres at
which it appears generally being entirely in the hands of the agency.

The agents must also inspect the act when it is first presented, determine its
worth, and place it with reference to the tastes of the communities in which the
theatres of their line are located. Most of this work is interstate business ; only
about 5% of the actors engaged live in Chicago, and about S% more in the rest
of Illinois ; the acts are sent over the states of the Middle West for the most part,
but to some extent to other states. The Western Vaudeville Managers' Association
is the largest agency in the theatrical line in the United States. It rents three
floors in the Majestic Theatre building, at $5,000 each ; it employs 69 clerks, at a
total weekly salary of about $1,500; it books all the acts for 147 theatres which are
in its circuit. The ordinary fee is 5% of all salary received.

H. Nurses' agencies are similar to theatrical agencies in not only securing the
initial position, but in keeping the nurses employed ; the nature of their work is
such that they can be, engaged ordinarily at one place only for a short time ; the
agency undertakes to secure a continuity in positions. The registration fee is
generally $2, and in addition there is a commission of 5% of the entire salary
received while registered. Most of this work is confined to Chicago.

Suggestions from methods of private agencies. This description of the meth-
ods used by private employment agencies shows several explanations of their suc-
cess : (1) The successful agencies have generally been in business for over 10
years ; this means that they have established a reputation ; it is as important for an
employment agency to be known to its patrons as it is for any mercantile establish-
ment. There are thousands of people who do not know there is a state employment
agency in Chicago, and thousands more who do not know there are three agencies
of that kind in Chicago.

(2) Advertisements and circulars describing the nature of the work done by
the private agencies are frequently sent out to patrons ; the agencies attempt to
secure a definite list of patrons, to hold them, and to enlarge the list.

(3) Personal solicitation is as important an element in the success of the
private agencies as in any other business. One agent stated that he went personally
to the patrons of his business about once every three months, in order to keep them
acquainted with him, to learn whether they had complaints or suggestions to make,
etc.

(4) The private agencies do not hesitate to make expenditures for the sake
of keeping up their business. The more successful agencies have seven or eight



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