Research Notes & Special Studies by the Historian's Office
Research Note #6:
|The start of Social Security payroll reporting
in January 1937 required the issuance of Social Security Numbers
to 26 million American workers; the assignment of 3.5 million Employer
Identification Numbers; the development of a centralized system
of record keeping that included a Visible Index listing the name
and number of every covered worker and taking up 24,000 square feet
of floor space--all in an era before the advent of computers. In
fact, the weight of the paper records involved was so massive that
no building in Washington had floors sturdy enough to hold it and
the records had to be housed in an old Coca-Cola factory in Baltimore.
It was described in news accounts of the time as "the largest
bookkeeping operation in the history of the world."
During the initial planning of the new program, directed by Secretary of Labor Frances Perkins, there was serious concern that the task was undoable. Indeed, a French industrial expert hired to advise the government, concluded simply: "It can't be done. The government should just abandon the whole idea." Frances Perkins recounted the day she finally concluded the experts were wrong: "The IBM hadn't invented the machines you all operate so easily. And I want you to realize that it took some courage. . . to launch the program without the IBM machines. I would like to add that under any circumstances I was always a bit nervous about it, and I remember the day that Arthur Altmeyer, who was then First Assistant Secretary of Labor, walked into my office and said, 'You know I think we found it.' Because he had been talking about, you know, handwritten pieces of records and how they were to be organized and stacked up, 'I think we've found it. These new IBM machines, I believe they can do it.' And so out of that really inventive group, that worked in the IBM research group,we found a way by which this could be done."
The "new IBM machines" Secretary Perkins had in mind was principally the IBM 077 Collator. This was a machine developed by IBM expressly for the new Social Security program and deployed to this task in early 1937. According to the IBM account salesman, H.J. McDonald, IBM President Tom Watson had ordered the development of the Collator because he was concerned that the government would not otherwise be able to meet its obligations under the new Social Security program.
The Social Security Administration (SSA) operated the IBM Collater, and a variety of other mechancial card-punch and tabulating devices, throughout the 1930s and 40s. In 1950, SSA deployed its first electronic computing device, an IBM 604 Electronic Calculator, which was used to do benefit computations. In August 1955, SSA received its first large-scale, general-purpose, computer, an IBM 705. The unassembled machine was delivered to SSA in August 1955, but it then underwent a long period where it was being assembled and tested by IBM technicians before the machine was certified as fully functional and it was turned over to SSA staff to start using it. That happened in March 1956. So SSA had its first general-purpose computer in August 1955, but it was not operational until the following March. The 705 gradually took over most of the accounting functions associated with the Social Security program, and continued in use until the 1960s when later generations of electronic computers replaced it.