Turmoil & Triumph: The George Shultz Years

George Shultz as Department of Labor Secretary

The Philadelphia Plan - 1970

As part of its effort to lift the economic status of blacks, the Nixon Administration has sponsored a controversial program to help them obtain more well-paid jobs in construction. …

Under the "Philadelphia Plan," so called because it was first tried in that city, contractors bidding on federally aided projects costing $500,000 or more must make a serious effort to increase the number of blacks among their new employees from about 5% now to 25% in five years. Since the plan was put into effect last August by Labor Secretary George Shultz, union leaders and other opponents have attacked it on somewhat ironic grounds. They argue that it violates the 1964 Civil Rights Act, which prohibits racial quotas in hiring.

Labor Secretary Shultz publicly scolded the A.F.L.-C.I.O. for its opposition to the Philadelphia Plan. Assistant Secretary Arthur A. Fletcher called the plan "our last chance to narrow the income-distribution gap between whites and blacks." As Congress raced toward adjournment, the House went along with the Administration and finally rejected [a] crippling amendment, 208-156, and the Senate concurred in a midnight vote, 39-29.

From Time magazine, “Labor: A narrow victory for blacks” January 5, 1970.

George P. Shultz was President Nixon's first appointee to head the Department [Labor]. An economist with special expertise in labor problems and issues, Shultz was described as an "intellectual conglomerate." He was dean of the graduate business school at the University of Chicago at the time of his appointment and had served several Administrations in advisory capacities.

While running the Department of Labor, he also played a major role in formulating the Nixon Administration's economic policies. Shultz had excellent relations with organized labor and served as the Administration's chief contact with the AFL-CIO. Shultz left the Department in June 1970 to head the newly created Office of Management and Budget (OMB). While he only served 18 months as Secretary, Shultz's tenure set the general course which the Department followed until January 1977.

Appointed by Richard Nixon.
Promoted revenue sharing manpower programs, reduction of poverty.
Supported comprehensive manpower system to integrate planning and allocation of resources. Proposed the Manpower Training Bill of 1969, which was a precursor of manpower legislation to follow.
New computer technology was used to develop job banks to match jobless men and women with employment opportunities.
He provided leadership in encouraging equal employment opportunities, specifically through the "Philadelphia Plan" (See box at right.) for non-discrimination in federal construction projects.