Cotton Textile Wages in the United States and Great Britain: A Comparison of Trends, 1860–1945 9780231880404

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Cotton Textile Wages in the United States and Great Britain

COTTON TEXTILE WAGES in the United States and Great Britain A C O M P A R I S O N OF TRENDS, 1860-1945 ROLAND G I B S O N University of Illinois

K I N G ' S C R O W N PRESS Columbia University. New York

19 48

Copyright ROLAND

1948

by

GIBSON

P r i n t e d in the U n i t e d S t o t e s of by Edwards

KINGS is o d i v i s i o n o f C o l u m b i a

America

Brothers, A n n A r b o r , M i c h .

CROWN

University

PRESS

Press o r g a n i z e d

for the

purpose

o f m a k i n g c e r t o i n s c h o l a r l y m a t e r i a l a v a i l o b l e at m i n i m u m cost. T o w a r d that e n d

the p u b l i s h e r s h o v e a d o p t e d e v e r y r e a s o n a b l e e c o n o m y e x c e p t

such os w o u l d interfere with a legible format. substantially

as

submitted

attention of C o l u m b i a

by

the a u t h o r

University

Press.

The work

without

is

the u s u a l

presented editorial

To My Mother the Memory of My Uncle J. Matthews

PREFACE E v e r since Thomas Cart-wright's invention of the power loom in 1785 the cotton textile industry has b e e n the problem child of the factory system. Its early evils gave rise to the F a c t o r y Acts in Great B r i t a i n and the g r o w t h of combinations w h i c h developed into textile trade unions. In the United States it was among the first so-called "infant Industries" to receive protection from the tariff. W h e n the Fair Labor Standards Act was enacted in 1938, the manufacture of cotton goods was singled out for Immediate a t t e n t i o n by Industry Committee No. 1. It was the first w o r l d Industry to receive a n y thing like systematic scrutiny from the International Labour Organization. The industry merits this a t t e n t i o n from persons and groups concerned w i t h labor standards because It customarily pays the lowest wages of any large industry in industrialized countries. There is justification for attempting to raise the standard of living of workers in this industry throughout the w o r l d , but before wise remedies can be suggested, m u c h w o r k needs to be done in analyzing the comparative status of cotton textile wages in the various countries where the industry plays a n important economic role. It is essential not only to know something of the comparative level of wages at the p r e sent time but also of the previous trend of wages in each country. It is very Important to a s c e r t a i n where the greatest progress has been m a d e in raising wages and what have b e e n the primary causes for whatever outstanding increases have taken place. The present study undertakes to perform this task for the two countries w h i c h have b e e n the world's leading producers of c o t t o n goods since the advent of the Industrial system - Great B r i t a i n and the United States. Any w i s d o m that can be acquired from a study of historic trends in these advanced Industrial nations should serve as a guide post for future studies of the movement of cotton textile wages in other countries. Knowledge of the factors w h i c h have Influenced the movement of wages in these dominant textile producing nations should

v111

COTTON TEXTILE WAGES

provide guidance for those who endeavor to raise textile wages In less advanced countries and In areas where the Industry Is likely to be Introduced for the first time. The study traces the movement of cotton textile wages In Great Britain and the United States from i860 to 19^5. These 85 years constitute a long enough period from which to draw reasonable theoretical conclusions, without running the risk of utilizing earlier statists cal data which are too sketchy to be valid. Even so, the United States data for i860 are based upon a very small sample, but they have been subjected to a rigorous corrective technique which it is believed renders them reasonably accurate for the purposes at hand. After tracing the movement of hourly and weekly wages in the two countries between certain years when the fullest data are available for both nations, an analysis is made to determine the fundamental cause of the diversity In m: vement between the two countries, which is found in the relationship between wages and labor productivity, and the technological basis of productivity. The relationship between wages and the cost of living is then indicated, revealing the trend of real wages in each country, and an effort is made to estimate the approximate difference between the standard of living of workers in the Industry in Great Britain and in the United States. The movement of wages In the two world wars is then outlined, followed by studies of two particular aspects of the wage problem - differentials between workers of high and low skills, and differences between wages in different regions of the two countries. The final chapter is devoted to one of the most significant contrasts between the two industries - the fact that the British workers have been highly organized in trade unions during the entire period, while the American workers were largely unorganized until very recent years. It has been necessary to devise a few more or less original statistical techniques, of a common sense rather than mathematical variety, to estimate wages in the United States in l8b0, the exten- and importance of payments in kind in addition to money wages in the United States, index numbers of cotton goods prices for use in

PREFACE

lx

computing real value productivity. And the cost of living of workers in exclusively cottor. textile areas of the United States. These have been relegated to appendices, so that the development of the main thesis will not be Interrupted. Certain inferences which seem clear from the facts are embodied In a Conclusion. The author Is indebted to many previous students of the cotton textile Industry in Great Brltlan and the United States for many facts and Illuminating Ideas. These authorities are credited in the text and In footnotes. He is especially indebted to the Columbia University Library, whose government documents and other source materials provided the basic data for the study. The members of the staff of the Columbia library have been cooperative at all times. Numerous individuals at Columbia University and in the textile Industry of the United States have offered suggestions and assistance at crucial moments. The critical guidance of Professor Leo Wolman, of Columbia University, is particularly appreciated. Professors Carter Goodrich, Frederick C. Mills, and Paul F. Brissenden, of Columbia University, and Dr. Solomon Fabrleant, of the National Bureau of Economic Research, made valuable suggestions on particular points.

ACKNOWLEDGMENTS For p e r m i s s i o n to reproduce passages from the I n d i c a t e d works, g r a t e f u l a p p r e c i a t i o n 1 s e x p r e s s e d to the Harvard U n i v e r s i t y P r e s s , Cambridge, M a s s . , Melvln T. Copeland, The Cotton Manufacturing I n d u s t r y of the United S t a t e s , and F . W. T a u s s i g , Some A s pects of the T a r i f f Question, Green & Co. L t d . , London, Sydney J . Chapman, Work and Wages; Methueij & Co. L t d . , London, T. M. Young, The American Cotton I n d u s t r y . G. P. Putnam's S o n s , New York, Frank Tannenbaum, The Labor Movement; R l n e h a r t & C o . , New York, Herbert J . Lahne, The Cotton M i l l Worker; Routledge & S o n s , L t d . , London, J . W. F. Rowe, Wages in P r a c t i c e and Theory; Royal Economic S o c i e t y , p u b l i s h e r s of the Economic J o u r n a l ; and The T e x t i l e Manufacturer, Manchester, England ( s e v e r a l I s s u e s of the p u b l i c a t i o n between 1895 and 1 9 0 8 .

CONTENTS I. Wages from i860 to I945 II. Labor Productivity III. Real Wages and the Standard of Living . . . . IV. Through Two World Wars

1 13 28 41

V. Wage Differentials

47

VI. Regional Differences

61

VII. The Role of Trade Unionism VIII. Conclusion

69 90

Appendices I. Wages in i 8 6 0 II. Payments in Kind III. Index Numbers of Cotton Goods Prices IV. Cost of Living of American Workers

93 102 117 123

Bibliography

129

Index

135

Chapter I WAGES PROM i860 TO 1945 In i860 cotton textile workers in the United States earned, in money wages, approximately $4.20 for a week of 68 hours, or 6.2 cents per hour.1 In addition, those of them who lived in houses owned by the companies for which they worked received the equivalent of an additional 38 cents in cheaper rents and other types of payment in kind, with the result that the average total weekly wage of all cotton textile workers in the United States in that year was $4.48.2 In Great Britain the average worker was paid 11.6 shillings for a 60 hour week, or 2.3 pence per hour.3 At prevailing rates of exchange this was equivalent to $2.82 a week and 4.7 cents an hour. Thus the British full-time weekly wage was 63 per cent of the American (including payments in kind) and the hourly wage was approximately J6 per cent of the American wage. A picture of the trends - in the two countries between certain years when comparatively full data are available for both nations during the entire period under discussion is given in Table I and In Charts 1 and 2. The weekly earnings statistics in these tables represent full-time earnings for the stated number of hours for the years i860, 1891, and 1906. From 1914 on the statistics are for the average number of hours actually worked. Average actual earnings are not available for the United States prior to 1914. Between i860 and 1891 the wages of cotton textile workers Increased somewhat more rapidly in Great Britain 1. See Appendix I for method of arriving at this estimate. 2. See Appendix II for method by which this figure was derived, and a complete analysis of Payments in Kind for the entire period from i860 to 1945. 3. Estimate by George Henry Wood: History of Wages In the Cotton Trade, p. 128. See concluding section of Appendix I.

COTTON T E X T I L E WAGES Tatle

I

WACES OF COTTON TEXTILE WORKERS IN THE UNITED STATES AND GREAT BRITAIN, 1860-1945 United States

Great B r i t a i n

Average Weekly Money Earnings U)

Totaj. Weekly Earnings id.)

Hours Per Week

Average Hourly Wage

(c.)

(cente!

(s.)

ie6o

4.20

4.46

6.2

11.6

2.82 6O.O

1891 1906

5.99 7.37 7.64

6.14

68.0 63.0 61.4

9.5 12.0

17.0 19.6

15.3 48.0 37.2 32.4

19.5 52.2 36.8 37.6

4.14 56.5 4.78 55.5 4.75 54.4 9.56 51.3 8.13 44.6 9.15 46.0

33.7 35.6 74.6

8.35 47.3 8.49 45.8 15.05 46.7

Year

1914 1920 1924 1928 1932 1935 1938 1945

20.97 15.94 15.50 10.85 13.06 11*. "3 29.38

7.73 7.96 21.58

16.65 16.19 11.46 13.51 14.51 29.83

50.0 43.7 42.8 47.8

44.5 34.6 36.8 41.7

23.9 37.6 38.1 70.5

Average Weekly Earnings

Hours Average per Hourly Week Wage

({)

32.6

5.71 45.3

(d.)

(c.)

2.5 3.6 4.3

4.7

!*• 5 12. p

7.3 8.6 8.7

18.6

9.8 9.8 8.6

18.0

8.5 9.3

17.4

19.2

19.8 12.6

18.5 32.3

Index Numbers

United States

Year

i860

Average Weekly Honey Earnlnge

Total Weekly Earnings

Great B r l t l a n Avera ( Hourlj Wages

Average Average Weekly Weekly Hourly Money EarnWages Earnings ings

100 140

100

100

100

100

1891

137

1906 1914

176 182

147 169 168

1920

775

450

155 133 187

1928

499 380 370

173 178 482 372

153 I94 247

523

1932

258

316 32k 281

1924

1935 1936 1945

302 334 700

361 256 301 324

666

600 385 606 618 1137

B r i t i s h Wages as Per Cent of United States Vases

531 426 426 374

290

370

302

405 834

642

T o t a l Hourly Weekly Wage Earnings

67 69 65 62 46

63 67 62 60 44

51

1*9 57 50 62

59 52 64 60 51

59 50

76 77 72 57 39 45

61 53 46 49

46

WAGES

ir\ o\ W o ® co rH rH X

O

S

«h

CO

aj 0}

©

u

U

©

"i •d 3 S S Ü

5 5 co •tí tS s «H o •d C

c

M

PROM i 8 6 0

TO

1945

COTTON TEXTILE WAGES

WAGES PROM i860 TO 19^5

5

than In the United States. Professor Douglas, In Real Wages In the United States, I89O-I926, estimates the full-time weekly money earnings of United States workers in I89I at $5-99 for a 6^-hour week.4 This gives an hourly rate of 9.5 cents - 53 per cent above the rate in i860, compared with a British rate of 3.6 pence - 55 per cent above i860. Since hours were reduced slightly more in the United States during the period, the Increase in weekly money earnings was somewhat less - 40 per cent in the United States as against 47 per cent in Great Britain. The increase in total earnings, including payments in kind, in the United States was still less, because of the fact that payments in kind in I89I were less than in other years.5 After I89I wages began to increase more rapidly in the United States than in Great Britain. The rise in weekly earnings was less marked than in the case of hourly earnings, however, because of the greater reduction In hours in the United States. By 1914 the United States hourly wage rate had reached a level 147 per cent above i860, contrasted with a rise of 87 per cent in Great Britain, while total weekly earnings rose 78 per cent in the United States and 68 per cent in Great Britain.6 4. Professor Douglas's estimates for the years before 1914 have teen used In preference to the Bureau of Labor estimates because he has made an adjustment to include other occupations than those covered by the Bureau of Labor studies.

The Bureau of Labor

data are weighted on the side of the more skilled occupations. From 1914 on, howevel", the Bureau samples have Included the rates of the less skilled workers.

By applying the ratio of the pre-

viously "selected occupations" to "all occupations" in 1914 to the statistics for previous years, Professor Douglas was able to arrive at more accurate estimates of the actual wages of all workers in the earlier years.

$6.58.

The Bureau of labor figure for 1 8 9 1 was

5. See Appendix II. 6. There was no change In rates of wages paid to British workers between September, 1906, when the last detailed study of wages in the textile Industries was made by the British Government (Board of Trade:

Earnings and Hours Enquiry - J.

Textile Trades,

6

COTTON TEXTILE WAGES

(Footnote 6 Continued) 1906), and 191U, except for a temporary increase in 1907-8. But John Jewkes and E. M. Gray indicate, in Wages and Labour in the Lancashire Spinning Industry (HP. 18-19 and 198-9), that average hourly earnings rose approximately 2 per cent during the period up to the outbreak of the World War, as a result of technical improvements in the industry vhich enabled the workers to earn more in the same interval of time at the same piece rates. CONVERSION OF JEWKES AND GRAY - INEEX NUMBERS

September March June

1906 1913 1911*

p. 198 96.9 101.2

p. 199 95.7 100.0 99.7

Converted Index 100.0 102.1

Our wage figure of b.3 pence per hour in 191^ is based upon this estimate. The weekly earnings figure for this year was obtained by dividing total payrolls for the week studied by the Ministry of Labour in July, as published in the Ministry of Labour Gazette, by the number of workers employed in that week. The British statistics for 1924, 1928 and 1935 have been obtained from studies made by the Ministry of Labour in connection with the Censuses or Production taken Dy the Government in those years (See Ministry of Labour Gazette, June 1926, pp. 196-7; October, 1929, PP- 352-3; and Februax-y, 1937, PP• ^7-8). The hourly earnings data for 1920 and 1932 are the same as those shown in Table II, to follow, and weekly earnings data are as shown in Table III, and explained in footnotes appended to those tables. The data for October, 1938, have been computed from statistics published in the Ministry of Labour Gazette, February, 19^, PP. 303k, showing the earnings for July, 19^3, and percentage increases over October, 1938. The data for 19^5 are from the Ministry of Labour Gazette, February, 19^6, PP. 31* and 36. Hourly money wage data for the United States for 191^, 1920, 192U, and 1928, are from Bureau of Labor Statistics Bulletin 539, p. 2. Money weekly earnings data for these years were obtained by dividing total payroll figures, published monthly by the Monthly Labor Review, by employment figures. For 1932 and 1935 all data are from Bureau of Labor Statistics Bulletin 663, p. 68. For October, 1938, they are from the Monthly Labor Review, January, 1939. p. 237. For 19^5 they are from the Monthly Labor Review, November, 19^5, P. 10^7-

W A G E S F R O M i860 TO

1945

7

Since 1 9 1 4 the I n f l a t i o n in w a g e s in b o t h c o u n tries has b e e n m a r k e d , as the r e s u l t of the effects of two W o r l d Wars. The m o v e m e n t of wages during the two wars w i l l be d i s c u s s e d in C h a p t e r IV, b u t the t r e n d over t h e e n t i r e p e r i o d is i l l u s t r a t e d i n T a b l e s I I a n d I I T and in charts 3 a n d Table

II

TREND OF AVERAGE HOURLY EARNINGS OF COTTON T E X T I L E W O R K E R S IN T H E U N I T E D S T A T E S A N D GREAT BRITAIN, 1914 - 1945

x ©&r 1914 1916 1918 1920 1924 1928 1932 1935 1938 1943 1944 1945

United States Index Wage Numbers (cents) 15.3 17.97 26.7 48.0 37-2 32. 4 23.9 37.6 38.1 59-0 63.9 70.5

100 117 175 314 243 212 156 246 250 386 417 461

Great Britain V age Index (pence) Numbers 4.3 4.9s 6.5s 12.2s 9-8 9.8e 8.610 8.5 9-3 16.I11 17.211 19.2

100 114 152 284 228 228 200 198 216 374 400 446

7. United States statistics for 1916 and 1918 are from B.L.S. Bulletin 539, p. 2 ; and for October, 1 9 3 8 , July, 1943, July, 1944, and July, 1945, from Issues of the Monthly Labor Review. 8. Computed from the 1914 figure on the basis of Index Numbers given by Jevkes and Gray, oj>. cit., p. 199, on the assumption that hourly earnings in the whole industry would move approximately, with earnings in Spinning. The June quarter of 1914 has been taken as 100 and quarterly figures for 1916 and 1918 and monthly figures for 1920 have been averaged to obtain the Index Numbers for those years. 9. Average weekly earnings (37.66 s.) as given in Ministry of Labour Gazette, October, 1929, pp. 352-3, divided by hours worked (46.3). 10. Average weekly earnings divided by 1*5.5 hours worked. For method of arriving at Hours Worked see Chapter V, footnote 8. 11. From Ministry of Labour Gazette.

8

COTTON TEXTILE WAGES Table III MOVEMENT OF PER CAPITA WEEKLY MONEY EARNINGS OP COTTON TEXTILE WORKERS IN THE UNITED STATES AND GREAT BRITAIN 1914-194512 United States

Great Britain

Year

($)

(index Numbers 1914 = 100)

(Pounds)

Index Numbers (July 1914 = 100)

1914 1916 1918 1919 1920 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933. 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945

7.64 9.10 13.09 16.84 20.97 17.65 15.87 17.59 15.94 16.03 16.05 16.60 15.50 15-84 14.57 13.66 10.85 11.56 12.58 13.06 13.79 14.97 14.03 13.. 83 14.43 18.25 21.33 24.15 27.10 29.38

100 119 171 220 274 231 208 230 209 210 210 217 203 207 191 179 142 151 165 171 180 196 183 181 189 239 279 316 355 384

• 975 1.13 1.49 2.19 2.61 2.02 1.90 1.73 1-78 I.85 1.76 1.86 1.82 1.80 1.56 1.61 1.63 1.58 1.59 1.60 I.65 1.80 1.78 1.86 2.57 2.62 2.99 3-30 3.49 3-73

100 116 153 225 268 207 195 177 183 190 181 191 187 185 160 I65 167 162 163 164 I69 185 183 191 264 269 307 338 358 383

12. 1939-45 figures are for July of each year, 1938 figures for October. United States data are from bulletins of the Bureau of Labor Statistics and Issues of the Monthly Labor Review.

WAGES PROM i860 TO 1945

9

It will be noted that average hourly earnings rose more In the United States during the period, although they also declined more during the depression years. Weekly earnings moved upward approximately together in both countries during the period 1914-20 and also rose to a similar degree In World W a r II, although there was a lag of about a year In the United States at the beginning of the latter period as a result of the more Immediate influence of the war upon Great Britain as a belligerent nation. A greater stability In the average hourly wage rate Is observed In Great Britain In the peacetime period between the two wars, but average weekly earnings were maintained at a higher level in the United .States except for a couple of years in the depths of depression. The greater stability In British rates will be discussed later when we consider the influence of collective bargaining In the British industry. 1 3 At the end of the period 1860-1945 United States hourly earnings stood at 1,037 per cent above i860, compared with 754 per cent in Great Britain, and total weekly earnings were 566 per cent higher in the United States and 542 per cent in Britain. The gap in hourly earnings was thus much greater than in weekly earnings, (Footnote 12 Continued) British data have been obtained by dividing statistics of total weekly payrolls each month by the number of workers employed, and then obtaining averages for the 12 weeks studied by the Ministry of Labour In each year (except 1914, 1938, and 1939-45, in which the statistics are for only one week In each year.) The discrepancy between the statistics obtained In this way for 1924, 1 9 2 8 and 1935 and the statistics in Table I (above) is due to the fact that the data in Table I were taken from a more complete census of conditions in January, April, July, and October, 1924, and in October in 1928 and 1935. The fact that the more complete census for the four months in 1924 indicates earnings of 3 6 . 8 shillings, whereas our computed averages for the smaller samplings for those months show earnings of only 35-6 shillings. ( 1 . 7 8 pounds), would indicate that our computed earnings figures are somewhat lower than for the actual earnings of all workers in the industry. (Our figure for the four months is based upon a sampling of the earnings of 87,366 workers, whereas the special Ministry of Labour study covered 435,448 employees). 13. See Chapter VII.

10

COTTON TEXTILE WAGES

-3O c

•P G « "H || Eh -P J•H HCT\ Gffl fc, m o r| p .p -p .p h ID oU «®••W o .0 ) Ofc Pc xl E G 3 c d- a C O W JC OQ P G C D •GH U-JP >H1 G-TH

Eh

WAGES FROM i860 TO 1945

ai m .J -i -aT +X> «H HO I

o o •eH ). Perhaps he accepts a reduced wage, but he q u i c k l y puts himself in touch with the new c o n d i t i o n s . He spends more than he did a t home, but i t i s because he d e s i r e s t o , and because he must a d j u s t h i s way of l i v i n g t o a higher standard in order not t o be looked down upon by his fellows. In the end he does not f i n d i t much e a s i e r than b e f o r e t o l i v e w i t h i n his Income. To l i v e as his neighbours do r e q u i r e s n e a r l y a l l he earns. But a l though he may in times cease to be s e n s i b l e of i t , he i s , in f a c t , v e r y much b e t t e r o f f than f o r m e r l y . How i s i t , then, that the c o t t o n - m i l l operat i v e s of New England, although l e s s s k i l f u l and not more Industrious than our own, are a b l e t o e n j o y t h i s higher standard of l i v i n g ? The answer - confirmed by the h i s t o r y of Lancashire i t s e l f - Is contained in one sentence of Dr. S. von S c h u l t z e - G a e v e r n i t z 1 s book on The Cotton Trade In England and on the Continent, which I s h a l l quote: "Technical progress in connect i o n with an Increase of labour c a p a c i t y " - o r , t o put i t in another way, the i n t r o d u c t i o n of machinery and methods which cheapen production and economize labour - "accomplishes a permanent lowering of p i e c e wages, at the same time r a i s i n g the weekly earnings of the ope r a t i v e s and g r a d u a l l y shortening the hours of l a b o u r . "

Chapter IV THROUGH TWO WORLD WARS During the period under review both Great Britain and the United States participated In two World Wars, although the United States entered the conflict in each Instance more than two years later than Great Britain. It should be of Interest to observe what happened to the wages of cotton textile workers during these periods of crisis. At the beginning of World War I workers in the cotton textile industry of Great Britain were earning, on the average, approximately £ 1 a week. In the United States the average weekly money earnings were $7.64. Hourly earnings amounted to 15-3 cents In the United States and 4.3 pence (8.7 cents) in Great Britain.1 During the war wage rates were gradually raised in both countries, as shown in Table X on the following page. It will be noted that the raises in Great Britain during World War I failed to keep pace with the sharp increase in the cost of living. The British industry experienced great difficulty in obtaining supplies of cotton from abroad as a result of the German submarine campaign, there was considerable unemployment in Lancashire, and from 1917 on production was restricted by regulations of a Government Cotton Control Board.2 Consequently the efforts of the textile unions to obtain adequate increases in wages were unsuccessful until after the war was over. Between the beginning and end of the war wage rates, as exemplified in average hourly earnings, increased approximately 75 per cent in the United States and 115 per cent in Great Britain. The Cost of living increased roughly 50 per cent in th6 United States and from 100 to 120 per cent in Great Britain. The official 1. See Chapter I. 2. Hubert D. Henderson, The Cotton Control Board.

COTTON TEXTILE WAGES

42

Table X MOVEMENT OF WAGES IN THE COTTON TEXTILE INDUSTRIES OP THE UNITED STATES AND GREAT BRITAIN DURING TWO WORLD WARS World War I Year

1914 1916 1918 1919

United States Average Average Hourly Weekly Earnings Earnings (¿) $ 7.64 9.10 15.09 (January) 4

15-3 17.9 26.7

Great Britain Average Average Hourly Weekly Earnings Earnings (Pence) (/) • 975 1.150 1.493 2.147

4.3 4.9 3 6.5 3 9.2 3

1.• 78 3..30 3.• 34 3..49 3.• 34 3.• 73

9- 3 16.,1 16.• 9 17..2 17..2 19..2

World V.'ar II s Oct. July Jan. July Jan. July

1938 1943 1944 1944 19^5 1945

14.03 24.15 24.61 27.10 27-78 29.38

38.1 59.0 59-4 63-9 65.2 70.5

3. Computed from the 1914 figure on the basis of Index Numbers given by Jewkes and Gray, op. clt., p. 199. The June quarter of 1914 has been taken as 100 and the quarterly figureB for 1916 and 1918 have been averaged to give average Index Numbers for those yearB. All other statistics are from the Ministry of Labour Gazette, in Groat Britain; from B.L.S. Bulletin 539, p. 2, for the World War I years in the United States, and from the Monthly Labor Review for the World War II months. 4. It was not until December 1918 that wage ratee in Great Britain were raised sufficiently to offset the conspicuous increase in the cost of living. The figure3 for January 1919 are therefore given here to round out the picture. 5. No figures are available for hourly earnings for Great Britain in 1939, so October 1938 (the nearest prewar date for which comparable data are available) is used as the base for both countries.

THROUGH TWO WORLD WARS

43

INDEX NUMBERS Great Britain

United States Year

Average Weekly Earnings

Average Hourly Earnings

Cost of living

Heal Weekly Earnings

Real Hourly Earnings

Average Weekly Earnings

Average Hourly Earnings

Cost of Living

Real Weekly Earnings

Real Hour: Earnings

World War I

(1911* = 100) 1911* 1916 1918 1919

100 119 171

100 117 175

100 108 150

(July

100 110 lilt

100 108 116

(January)

1914 = 100)

100 116 153 220

100 114 152 215

100 11*6 203 220

100 79 75 100

100 78 75 98

World War I I Oct.

1938

100

100

100

100

100

100

100

100

100

100

172

151*

124

138

12 If

185

.173

182

102

95

175

155

125

140

124

188

182

180

104

101

193

167

127

152

132

196

185

184

106

100

198

171

129

15^

133

188

185

186

101

10s

210

185

131

I6O

141

209

206

194

108

106

July

1943 Jan.

1944 July

1944 Jan.

19^5 July

1945

figures of the Ministry of Labour reveal the latter figure but Professor Bowley 6 estimates that the rise was somewhat less because such foods as sugar, butter, eggs, and cheese were not attainable during the war in their prewar quantities and the expenditure on substitutes was less than it would have been for the exact items measured in the Cost of Living Index. He estimates the rise to have been 20 per cent less than that revealed by the official index. This would not deny, however, a decline in the workers' "standard" or "scale" of living as a. result of their inability to buy the quantities and quality of foodstuffs to which they had become accustomed.

6. Prices and Wages in the United Kingdom, 191^-1920, Chapter IV.

COTTON T E X T I L E W A G E S If we employ the official Cost of Living Index we discover that real earnings of cotton textile workers in Great B r i t a i n d e c l i n e d approximately 22 per cent b y 1916 a n d 25 per cent by 1 9 1 8 . Using Professor Bowley's revised index the decline w o u l d amount to 15 per cent by 1918. In a n y event the situation was m u c h worse than in the U n i t e d States, w h e r e wage increases more than offset the rise in the cost of living, allowing real hourly earnings to Increase 16 per cent and real weekly earnings 14 per cent by the end of the war. B y J a n u a r y 1919 the inequity in wage rates In Great B r i t a i n h a d b e e n corrected to the point where the real earnings of the workers w e r e commensurate w i t h the rise in the cost of living. Measured by the official Cost of Living Index, real hourly earnings of B r i t i s h cotton textile workers w e r e only 2 per cent below the 1914 level in January 1919 a n d real w e e k l y earnings were exactly the same. M e a s u r e d by Professor Bowley's index, real h o u r l y earnings w e r e 8 per oent above prewar and real w e e k l y earnings w e r e 10 per cent higher. B y the year 1919 average per capita weekly earnings in Great B r i t a i n h a d reached £ 2.193 ($9.70) while earnings in the United States averaged $16.84. 7 W o r l d W a r II, 1939-45 F o r W o r l d W a r II the nearest prewar m o n t h for w h i c h comparable figures are available for b o t h countries, for b o t h hourly a n d w e e k l y earnings, in October 1938. In that m o n t h cotton textile workers in the United States w e r e earning 3 8 . 1 cents per hour a n d $14.03 per week. B r i t i s h workers w e r e earning 9 . 1 3 pence (18.5 cents) per hour and £ 1 . 7 8 ($8.49) per week. W h i l e average hourly earnings rose more in Great B r i t a i n throughout the w a r period a n d w e e k l y earnings increased more rapidly there during the early years of the war, in the spring of 1944, w e e k l y earnings began to rise m o r e sharply in the U n i t e d States. By July 1945 the increase h a d reached approximately the same level for b o t h countries - 110 per cent above prewar. Average hourly earnings in Great B r i t a i n had reached 106 per 7. See Table III, Chapter I.

THROUGH TWO WORLD WARS cent above prewar by July 1945 and had Increased 85 per cent in the United States. American cotton textile workers were earning 70.5 cents an hour in July 1945 while British workers earned 19.2 pence (32-3 cents). Per capita weekly earnings averaged $29.38 in the United States and £ 3-73 ($15.05) In Great Britain. The Increase In real earnings In the United States during the war was greater than in Great Britain, as It was in the first World War. The British workers were able, however, at least to maintain the purchasing power of their income.0 Real weekly earnings rose approximately 60 per cent in the United States and 8 per cent in Great Britain. Real hourly earnings rose about 41 per cent in the United States and 6 per cent in Great Britain. A controversy arose in the United States during the war over the accuracy of the Bureau of Labor Statistics Cost of Living Index. Labor organizations argued that the Index did not reflect hidden Increases in the cost of supporting a worker's family. To Investigate the question President Roosevelt appointed a special committee in 1944, and a technical sub-committee of this body reported that the Bureau's Index probably underestimated the true rise in the cost of living from January 15, 1941 by from 3 to 4 per cent, and that an additional one-half per cent might be added for the cost of living In small cities.9 In the Cost of .Living Index Numbers cited for the United States in the above table 3 per cent has therefore been added to the Bureau's number for July 1943, 3-5 per cent for January 1944, 4 per cent for July 1944, and 4.5 per cent for January and July 1945. From these index numbers 3 per cent has then been deducted after 1938 to account for the lesser rise in the cost of living of textile workers than the rise shown

8. This was nade possible by the policy of the Government

in

subsidizing the production of certain items which were basic in the cost of living of wage earners. the

Without this policy of subsidies,

British cost of living would naturally have risen more than it

did. . 9. Monthly Labor Review. January

p. 168.

46

COTTON TEXTILE WAGES

in the Bureau's index for all workers, as disclosed in Chapter III and Appendix I V . 1 0 The statistics reveal the interesting fact that the United States did a better job than Great Britain during W o r l d W a r II in controlling the prices of commodities purchased by wage earners, and also a better job than was done in World W a r I. The record of Great Britain was somewhat better in this respect than Its record in W o r l d War I, and conspicuously better w i t h regard to assuring that wage increases should at least keep pace w i t h the rise in the cost of living. In the United States a certain amount of overtime was worked during World War II, at premium rates of pay, w i t h the result that average hourly earnings rose slightly more than straight-time hourly earnings. This was not the case in Great Britain over the period as a whole, because the Industry is rarely able to work up to its normal weekly quota of 48 hours. In the United States average straight-time hourly earnings rose 53 per cent between January, 1939> an-d January 1 9 4 4 , according to the B u r e a u of Labor S t a t i s t i c s , 1 1 compared w i t h an increase of 55 per cent in average hourly earnings. Real straight-time hourly earnings therefore rose 22 per cent instead of the 2 4 'per cent shown for average hourly earnings including overtime.

10. The two indices compare as follows: B.L.S.

1938

139

Cotton Textile

100

140

100

1945 184 132 181 129 11. Bulletin 7 9 8 , p . 5 . Statistics are given for North and South separately, hut they have been weighted by the numbers of workers employed in each area to obtain the averages. Straighttime hourly earnings were 37.8 cents in the country as a whole in January, 1939, and 57.9 cents in January, 1944. The B.L.S. analysis does not cover the later period from 1944 to 1945.

Chapter V W A G E DIFFERENTIALS A l f r e d Marshall observed, in his Principles of E c o n o m i c s , 1 that "the wages of unskilled labour have risen faster than those of a n y other class, faster even than those of skilled labour." A corollary of this w o u l d be that the gap b e t w e e n the wages of the poorest paid workers and those of the highest paid has b e e n n a r rowing throughout industrial history. F r a n k Tannenbaum, now Professor of L a t i n - A m e r i c a n H i s t o r y at Columbia University, gave the following explanation for this g e n eral condition in his early book on The Labor M o v e m e n t : a A n y union where a number of trades meet on a common level will, w h e n a wage dispute is on, make a demand for a higher percentage of increase for the lowest paid trade. This fact a n d the fact that the lowest paid workers are constantly demanding higher wages, organizing and increasing their power, as w e l l as limiting b o t h the hours of labor a n d the output, tend to bring their earnings nearer to those of the skilled workers. In his book, Some Aspects of the T a r i f f Question, F. W . Taussig notes that in the United States "it is among the characteristics of our general industrial conditions that the gap b e t w e e n the wages of skilled and unskilled is greater than in other countries," because the inflow of unskilled immigrant labor tended to depress the wages of that class of w o r k e r s . 3 It should be interesting to check these observations against the facts revealed from a study of the movement of the wages of different groups of cotton textile workers in the two leading industrial nations, Great Britain a n d the United States, over as long a 1. 8th ed., p. 716. 2. P. l6l. 3. Og. cit., p. 359.

48

COTTON TEXTILE WAGES

period of time as comparative data are available. We do not have any data for the United States for strictly unskilled groups of workers until very recent years, but we do have information on several groups of low-paid semi-skilled workers from 1916 on. But first let us consider the trend of wages of two comparable groups of skilled and semi-skilled workers in Great Britain and the United States over roughly two decades from before the first World War. The skilled groups studied are mule spinners and weavers; the semiskilled are frame (ring) spinners and frame tenders. The first data for Great Britain are computed from data in the 1906 Enquiry on Hours and Earnings. For the United States the first data are from the 1910 statistics gathered by the Bureau of Labor. Since no study of textile wages was made In the United States between 1930 and 1937, and since mule spinners passed out of the picture after 1930 as a group important enough to be studied, our terminal year for this country is 1930. 4 The data for the British spinning industry in 1932 are from the study made by Professors Jewkes and Gray.5 For British weavers an adjustment has been made in the data gathered by Professor Gray in 1937 to approximate the probable level of weavers' wages in I932. 6 The data are shown in Table XI on the following page. The table discloses that the wages of the two skilled groups rose more than the wages of the two semiskilled groups in both Great Britain and the United States in the periods studied, thus widening rather than narrowing the gaps between the average wages of the skilled and the semi-skilled. Now let us add to these groups as many more categories of skills as we can for each country and study the results, which will not be exactly comparable as between countries, but wj.ll be more representative of the true differentials between groups of workers of different

If. Data for "both 1910 and 1930 are from Bureau of Labor Statistics Bulletin 5 3 9 , pp. 3 - 7 . 5. Wages and Labour in Cotton Spinning, p. 201. . 6. See: The Weaver's Wage and see Footnote 8, "below Table XI.

WAGE DIFFERENTIALS Table XI WAGES OF COMPARABLE SKILLED AND SEMI-SKILLED WORKERS IN THE UNITED STATES, 1910-1930, AND IN GREAT BRITAIN, 1906-1932 United States (cents per hour) 1930

Index Number, 1930 (1910 = 100)

Occupation

I91O

Skilled Mule Spinners Weavers

.219 . 149

.673 • 392

308 263

.150

.397

265

.109 • 119

.269 • 332

247 280

• 113

.293

260

Average Seml-skllled Frame Spinners Frame Tenders Average

Per cent of skilled 75

73

Great Britain [Shillings per hour) Occupation

1906

1932

Skilled Mule Spinners Weavers

.740 .369

I.58O 7 .730°

213 198

.413

.83

200

.277 .348

.6oo 9 .608

217 175

• 332

.606

182

Average Seml-skllled Frame Spinners Frame Tenters Average

Per cent of skilled 80

Index Number, 1932 (1906 = 100)

73

7. Mule spinners In the comparable districts covered by the Jevlces and Gray study increased their earnings from .77 shillings in 1906 to 1.64 in 1932. The 1 9 0 6 figure for all mule spinners was .74, or 96.I per cent of the figure for the canparable districts. The earnings figure shown here for 1932 -ias been reduced

50

COTTON TEXTILE WAGES

(Footnote 7 continued) to 96.I per cent of 1.64 to approximate the probable wage of all mule spinners, including those not covered by the study. Data are unavailable on the number of each class of workers employed in Great Britain in 1932, consequently all the 1952 wages in the Table hare been weighted by 1906 employment figures for Great Britain and by 1910 figures for the United States. 8. This estimate for weavers, 1932, is based upon the assumption that the 1932 wage would bear roughly the same ratio to the 1937 wage, which we know frcan Professor Cray's study, as the percentage increase in average hourly earnings in the entire weaving branch of the industry between 1906 and 1932 bears to the Increase between 1906 and 1937. Average weekly earnings figures from 1906 on can be computed readily from reports of the number of workers employed and total pay rolls in each branch of the industry, as published for one week in each month by the Ministry of Labour Gazette. In 1906 the average in the weaving branch of the Industry was £ .91*+. Since 1906 was a prosperous year in the British cotton trade, providing relatively full-time employment, the normal number of weekly hours worked, 55.5, is a reasonable estimate for the actual hours worked. Dividing £ .914 by 55-5, we obtain £ .OI65 as the average hourly earnings. To estimate the hours worked in 1932, employment statistics for the year have been compared with a census of employment taken in October, 1931 (Ministry of Labour: Twenty-first Abstract of Labour Statistics, p. 107). In that month an average of 1.9 hours of time were lost by each worker, because of the depression, out of 48 hours of normal full-time employment. Dividing £ 1.66, the average weekly earnings for the Industry in October, 1931» hy 46.1, the average number of hours worked, we obtain £ .036 as the average hourly earnings for the month. Since there was no change in the rates of pay between then and 1932 until December of the latter year, we can obtain a fair approximation of the hours worked in 1932 by dividing the average earnings for the first 11 months, £ 1.638, by £ .036, the average wage In October, 1931. The result is 45.5 hours per week. Dividing this figure into £ 1.602, the average weekly earnings in the weaving trade in 1932, we obtain £.352 as the average hourly earnings of workers in the weaving branch of the industry in that year. In 1937 the Ministry of Lab out- Gazette published estimates of percentages of employed workers on short-time and the numbers of hours lost per week. From these statistics an estimate of 47.4

W A G E DIFFERENTIALS

51

skill within each c o u n t r y . 1 0 Again the average wages have been obtained by weighting each wage by the number of workers employed In each category In the base year. The data are shown In Table XII on the fallowing page. This more representative selection of groups to represent skilled and unskilled discloses less of a difference between the movement of the wages of skilled and less skilled workers than we observed in our study of the more limited selection of groups in the first Table. It reveals that the less skilled group maintained its relative position with respect to the skilled over the period of years covered, and shows a tendency for the wages of the least skilled to rise more rapidly than the skilled. W e find, for instance, the wages of three out of four of the lowest paid groups in both countries rising more rapidly than the highest paid mule spinners.

(Footnote 8 continued). has been computed as the average number of hours work3d in the Industry in that year. Dividing this figure into £ 1.79U, the average weekly earnings in the weaving trade, we obtain £ .0376 as the average hourly earnings of weaving trade workers in 1937. From these hourly earnings, index numbers of the increase since 1906 can be readily computed, as follows: 1905 -- 100; 1932 -- 213; 1937 -- 228. Taking 1937 as 100, we find that the average wage in the weaving trade in 1932 wa3 approximately 9h per cent of the wage in 1937. Now taking 91* per cent of the 1937 weaver's wage of .775 shillings per hour (computed from data in Gray, oj>., clt., pp. 10, 35, and 37), we obtain .73 shillings as the probable hourly wage of weavers in 1932. 9. Frame spinners in the comparable districts covered by the Jewkes and Gray study increased their earnings from .289 shillings in 1906 to .627 in 1932. The 1906 figure for all frame spinners was .277, or 95-6 per cent of the figure for the comparable districts. The earnings figure shown here for 1932 has been reduced to 95-8 per cent of .627 to approximate the probable wage of all frame spinners, Including those not covered by the study. 10. Data for the United States for all of the occupations were first obtained in 1916 (B.L.S. Bulletin 539, PP- 3-7)- Data for Piecers in Great Britain are from Jewkes and Gray, oj>. clt., p. 201. Data for Reelers and Winders, 1932 represent 91* per cent of the 1937 wage cited in Gray, 0£. clt., pp. k2-h8, using the same adjustment as In the case of weavers (see n. 8 above).

52

COTTON TEXTILE WAGES L 0' XI 6 3 C

„ o o rH

CM KN l| as X rH VO 01 o Os •a rH c M

—.

co w Eh

c •H

Ei CO

•H


t—

f m

O S CO CM o m •=»• •

rH rH m

SO o Os 1—1

O CO -3- s o prs

m i n .=*rH so CSJ OJ O J • •

in

rH

u

aj Q.

.o

a t->

Q a 3 •j

HH c n

M

EH

ii


. c i t . , p. 8. Ibid., pp. 8-9.

THE ROLE OP TRADE UNIONISM

83

"Prom the operatives' point of view," the Commission added, "it may be too easily assumed, for example, that the object and result of "time and motion studies' is to extract for the benefit of the employer the greatest possible amount of work from the employee at the least possible cost. That such an effect is neither the necessary nor indeed the proper application of scientific work load assessment has been proved by the experience of other industries and in other countries, where the result has been in truth [not only] a reduction In production cost but also em increase in the operatives' earnings flowing from an Increase in the effectiveness of their efforts rather than an Increase in their physical exertion." Inflexibility in Labor Utilization All three of the reports cited above refer to the problem variously described as management scope in the utilisation of labor, or the application of scientific methods to work-assignment, or reallocation of the duties of operatives. The introduction of modern machinery almost Invariably requires readjustments in the division of tasks among the various operatives, in order to be profitable and reduce costs. When a weaver, for example, is given several additional looms to operate, he must naturally be relieved of much of the auxiliary work of providing the looms with fresh yarn and removing the beams from the looms when the cloth is woven. This work does not require the skill of a trained weaver. It can be done as well by unskilled workers. The weaver's time must be left free to watch the looms and repair breaks in the yarn when they occur. There are similar illustrations that could be given where this principle applies to the division of labor in other parts of the textile manufacturing process. (Several of these illustrations have already been given in Chapter II under the heading of Better Organization of the Working Force in American Mills.) 32 In the United States, where most 32. The Evershed Report recommended (p. 12) that "in staffing the several sections of the industry the skilled operatives should to the mmclnrnTn possible extent be relieved of cleaning, sweeping, and other unskilled work, this class of work being performed by auxiliary labour, both Juvenile and adult."

84

COTTON TEXTILE WAGES

employers were free to make the desired readjustments at will, without objection from union representatives, technological progress was rapid. In England, on the contrary, even if management had been minded to make such alterations, they would have run headlong into the long-established groupings of workers into special crafts, organized into trade unions and paid according to elaborate lists of wage rates fixed for performing special tasks which, in most cases, had been carried on, as outlined, for almost as many years as the lists had been in existence. These wage lists were established in the mule spinning and weaving Industries long before 1887; in ring spinning in 1912. 3 3 They have been a tradition in the industry for decades. Minor changes have been made in them at various times, but nothing in the nature of what would have been required by the type of reorganization of industrial processes and reclassification of Jobs which alone could have enabled the British industry to keep abreast of the latest developments in technology and industrial efficiency. Mr. H. P. Greg alluded to the problem in a paper he read before the British Association of Managers of Textile Works, which was summarized as follows in The Textile Manufacturer for April 15, 1907: "Whilst having a great admiration for the trade unions and the work they have done, Mr. Greg thought that in fixing standard rates of pay they had done something which was prejudicial to the development of industry and which had not achieved their ideal of a 'fair day's wage for a fair day's work.' Standard rates prevented the employer from organising labour in the mills to the best advantage, though, while regarding the operatives as short-sighted in this matter, it was alarming to see the zest with which the Masters' Federation had recently thrown itself into the work of elaborating standard rates of wages for the card room and other workers. In order to make progress there must be liberty for organisation, and until the masters and operatives realised this we should be fighting blindfold for the markets of the world. The 33. Sydney J. Chapman: The Lancashire Cotton Industry, p. 265, and Jevlcee and Gray, op. clt., p. 118.

THE ROLE OF TRADE UNIONISM

85

wage cost of production, which was the largest proportion of the cost, could be reduced without reducing wages, but it could not be done in the face of standard rates." 34 Use of the standard rate formula has made for rigidity in the establishment of wage rates and the classification of Jobs, whereas flexibility in such matters is needed to promote progress in technology and industrial management. The British Economic and Advisory Council Committee on the Cotton Industry pointed this out in its report in July, 1930, in the following paragraph : "More generally, there is need In the cotton industry for constant cooperation in the adjustment from time to time of detailed methods of working in the mill in such a way as to secure the maximum output under the best conditions, and for the review of matters between employers and trade unions for the industry as a whole, or for individual sections, in order to secure a greater flexibility for adjustment to changing conditions. As an example may be cited the lists of weaving piece wage rates, which were established in great elaboration, many years ago, and which, except for modifications in points of detail, have remained unchanged to this day. It may be found that there would be substantial advantage in their reconsideration with a view to the establishment of greater flexibility and possibly to agreement upon a new basis more satisfactory to both sides."35 Wage Differentials The British cotton textile workers are organized into some 153 local craft unions. 36 Except for the mule spinners, who are organized in one national union, The Amalgamated Association of Operative Cotton Spinners, the crafts in each town have their own union which is, in turn, usually affiliated with a national federation. 31*.

clt., p. ll*6.

35. Op. clt., published. In British Accounts and. Papere, 192930, X H , p. 18. 36. Ministry of Labour Gazette. November, 19^5, P. 195.

86

COTTON TEXTILE WAGES

The most Important of these is the Amalgamated Weavers' Association. Thus the ring spinners and other card and blowing room operatives in each town have a union, the weaving overlookers in the town have a union, and the same with the warp dressers and warpers, the tape sizers, the beamers, twisters, and drawers, and the weavers.37 Because of their position as the craft aristocrats of the Industry and because they have always been the most highly organised craft, the mule spinner3 have led all groups in the improvement of their wage status since 1886, as we saw in Chapter V. For the opposite reason the little piecers have benefited least. For all practical purposes they are employees of the mule spinners and their wages are to a considerable degree controlled by the spinner. Frequently the spinner hires and fires his piecers. Although in some districts the piecers' wages are fixed by the wage lists, in others the plecer's wage is set by individual bargaining between spinner and piecer. Efforts have been made to bring the piecers into membership in the spinners' union, partly to prevent them from scabbing in a strike, but never have more than 50 to 60 per cent of all the piecers, big piecers and little, become organised. Undoubtedly most of these have been big piecers, who are over 21 years of age for the most part. Some efforts have been made to organise piecers into an independent union of their own but all of them were 3hort-lived. Part of the reason for this has been indifference on the part of the piecers, the big piecers regarding themselves as apprentices looking forward to being promoted to become spinners, and the younger little piecers, mostly under 21 years of age, looking forward to becoming big piecers. In addition, as Messrs. Jewkes and Gray point out in Wages and Labour in Cotton Spinning, from which the above facts have been drawn, "the spinner is in a highly advantageous position from which he would find it easy to crush opposition if he wished. The spinner is the plecer's employer: he Is not likely to give employment to those piecers who are agitating for further power which might be used to increase piecers' wages at the 57. See Reports on Trade Unions of Chief Latour Correspondent, Board of Trade, Latour Department.

THE ROLE OP TRADE UNIONISM

87

expense of the spinner himself. The spinners control the piecers 1 trade union funds: it is hardly likely that in a strike against his immediate employer, the spinner, the plecer would be allowed to draw strike benefit."38 We have seen that the wages of big piecers increased more than those of little piecers between 1886 and 1932, tut not as much as they should have in view of the fact that the big piecers are chiefly men. The differential between their average wage of . 6 7 shillings in 1932 and the I . 5 8 shillings earned by mule spinners is certainly greater than can be explained or Justified on the grounds of difference in skill or Justice. The little piecers earned more than the doffers in both 1886 and 1932, which can be explained on the basis of greater skill, but the doffers improved their status more during the period, which can probably be explained on the basis of increased demand for this type of Juvenile labor In the growing field of ring spinning. Some improvement is likely to be brought about in the status of piecers if the recommendation of the Evershed Report with respect to them is carried out. The Commission recommended that the occupation of plecer be discontinued altogether and that the mules be operated in future by two skilled adult workers who will normally be a spinner and an assistant spinner, but may be two Joiner spinners or a spinner and an ex-spinner. 3 9 The great improvement in the earnings of the winders and reelers since 1906 was undoubtedly brought about by collective agreements negotiated for them in 1919 and 1921 by the Weavers' Amalgamation, of which most of them who are organised are m e m b e r s . 4 0 It is to the credit of this union that it negotiated rates for these unskilled workers which enabled them to increase their hourly earnings between 1906 and 1932 more than the earnings of its weaver members. No accurate observations can be made on the reasons for the relatively poor showing of frame tenters in advancing their earnings with respect to other crafts,

38. Og. _cit., p. 170. 39. 02. cit., p. 28.

Other facte from pp. 165-170.

UO. Gray: The Weaver's Wage, p. 55.

88

COTTON TEXTILE WAGES

because no special study has been published on the wages of card and blowing room operatives. The reason may be found partly in greater lack of technological advance in the spinning preparatory stages and partly in terms of demand for their particular kind of labor. Maintaining Real Wages The one real achievement of the British unions with respect to wages - and no other aspect of the labor problem is being considered in this study - has been in maintaining the real wages of the workers at most times during the period studied, the most notable exception being during World War I, when the special conditions discussed In Chapter IV interfered with their efforts in this direction.41 As J. W. F. Rowe states, in Wages in Practice and Theory, 42 "In regard to the general level of wages, the cotton unions appear to have continued their old policy by endeavoring to maintain the 'real' wages yielded by the lists in 1912, slightly modified according to the level of profits. Thus in the post-war boom they eventually raised the level of the lists to something more than a parity with the increased cost of living, and in the subsequent slump they accepted reduction to something less: meantime the rate of earnings as distinct from list rates has continued to increase ." As we have seen in Chapter III, this union policy resulted in a greater stability In the upward trend of real wages over the years than in the United States. Thus real wages did not rise so sharply in 1920 as they did in the United States, due to the stabilizing influence oY collective agreements in Britain, contrasted with the almost completely unimpeded Influence of the forces of the free labor market in the United States. 41. The gaps in our data between i860 and 1891 and between I89I and 1906 are 00 great that it is Impossible to state categorically that real wages were maintained at all times during these periods more successfully In Great Britain than in the United States, tut It appears, at all events, to have been true that real wages rose to a greater extent between the terminal years in Great Britain than in the United States. 42. 0^. clt., p. 166.

THE ROLE OF TRADE UNIONISM

89

And in the depression, which began in the cotton textile industry in the middle twenties, real wages continued to rise in Great Britain while they declined in the United States. After the depression, however, real earnings again rose more rapidly in the United S t a t e s . 4 3

V3. See Table DC, Chapter III.

Chapter VIII CONCLUSION This study has revealed that the money wages of cotton textile workers rose more In the United States than In Great Britain over the entire period between i860 and 19^5» largely because the British Industry failed to keep pace with modern developments In technology and Industrial organization after 1900, with the result that the productivity of labor and hourly wages In Great Britain lagged behind labor productivity and hourly wages In the United States. Although British pianagement must bear the ultimate responsibility for this lag, we have seen that the British trade unions also must bear some share of »esponslbllity for the policies they pursued In hampering the progressive manufacturers who tried to modernize. Nevertheless, because of the greater decline In the cost of living in Great Britain between i860 and 1891 and the failure of the cost of living to rise as much in Great Britain as in the -United States between 1 8 9 1 and 1914, the real wages of British workers rose more than those of American workers up to 191**. From 1914 to 1924 real wages then rose more rapidly in the United States, but between 1924 and 1932 real wages rose in Great Britain while they declined in the United States, probably as a result of the policy of the British trade unions in concentrating on the maintenance of real wages. Since 1932 we again find real wages rising more rapidly in the United States. It seems clear from these findings that if the British unions had placed no obstacles In the way of modernization, and if the manufacturers had Installed the latest equipment and stream-lined their methods of organization, the British workers would have been better off than they were and more of them would have retained their Jobs - not in the short run, perhaps, but definitely in the long run. This conclusion has implications for both managerial and labor policy which would seem to have validity

CONCLUSION

91

not only for the textile Industry but for all Industries and for all countries. The first implication Í3 that management, or capital, serves not only its own best Interests but the Interests of its employees and the public as a whole by exerting every effort to improve the technique of production by installing so-called labor-saving devices and streamlining production methods. The second implication is that labor unions imperil the long-run status of their own members, the members of other labor unions In their capacity as consumers, and other members of the community by placing obstacles in the way of the installation of labor-saving devices and the Improvement of other methods of production. Our study of wage differentials has revealed a somewhat larger gap between the wages of workers of the highest and lowest skills in Great Britain than in the United States, contrary to views sometimes expressed by economists that the general tendency was in the opposite direction. We have seen that the craft structure of the British cotton unions and the policy of some of the crafts to press their privileged bargaining position at the expense of less well organized unskilled groups has been at least partly responsible for this. An implication from this revelation for labor policy would appear to be that the best Interests of all workers are not served if individual workers or groups of workers concern themselves with maintaining their own status or attempting to improve their narrow craft status at the expense of other crafts. In fact, the implication is that it would be better for the welfare of workers and the community as a whole if unions would allow management considerable flexibility in reorganizing job assignments and classifications from time to time. Such reassignment and reclassification should go hand In hand with technological improvements. It is not the function of this study to discuss so-called technological unemployment, but the facts revealed seem to imply that an effort to stave off technological unemployment for a particular class of workers, in the short run, may create more widespread unemployment of a more serious nature, in the long run.

92

COTTON TEXTILE WAGES

Regarding the problem of elevating the standard of living, whether in backward or advanced countries, the implication of our findings is that the crux of the issue is to increase the productivity of the factors of production, whether land, labor, or capital. The more this productivity can be increased, the greater will be the rise in Income, and the greater will be the increase in the standard of living.

Appendix I WAGES IN i860 The most useful source of Information on wages in the United States in i860 is the report of the Aldrich Committee of the Senate, published in 1893- 1 Daily wage rates for a wide variety of occupations in the country's principal industries are here enumerated, as obtained from a limited number of firms with annual records extending from 1891 as far back, in some cases, as 1840. The year i860 has been selected as the initial date for the present study partly because data are available for more occupations in the cotton textile industry beginning in that year than for the years preceding. Quotations are listed for 799 cotton goods workers employed in January, i860, by three establishments in the state of Massachusetts and one in New York. Quotations of wage rates in July of the same year are listed for the 791 workers employed in that month. From this number 20 weavers' rates have been eliminated from the January data and 21 from July because they are given by one firm as piece rates (cents per cut for sheetings of specified size) and it Is impossible to translate them into day rates. The remaining rates have been multiplied by the number of workers receiving them to determine weighted arithmetic means for each of the months, and the two means have then been averaged to obtain a representative wage for the year. The difference between the two months is slight - $.8237 per day in January and $.8250 in July, making an average of $.82^3, or $4.9^58 for a full six-day week. But how representative of the industry in the country as a Whole is this figure? The sample is taken from long established mills in only two northeastern states. There are two ways of checking the results. One is by reference to two other government sources on wages 1. 52nd. Congress, Second Session: Senate Report 1594—Wholesale Prices. Wages and Transportatlon, Volumes 2 and 3.

COTTON TEXTILE WAGES in the nineteenth century and the other is by comparing the statistics for the final year investigated by the Aldrich Committee with statistics gathered by the United States Bureau of Labor In 1904 from a much larger sample of firms from 1890 on, and devising a correction factor to be applied to the i860 average. The other sources on wages in i 8 6 0 are the report of Joseph D. Weeks, which forms a part of the l880 U.S. Census, 2 and reports of the Massachusetts Bureau of the Statistics of Labor. Unfortunately neither of the3e reports states the number of employees who received the published rates for the specified occupations. Thu3 the averages obtained by adding the rates and dividing by the number is an unweighted mean. To put the Aldrich material into a comparable form, it hás been necessary to treat the average rate for all the workers in each occupation in each establishment as a single rate and obtain a new mean of the rates. In this form the Aldrich mean becomes $1.115, averaging 129 rates. The Weeks mean of 3 M rates, representing 19 establishments in nine states, is $1.035. This includes no data from Southern states where, even in i 8 6 0 , 8 . 3 per cent of the gainfully occupied workers in the industry were employed. Since the Weeks mean Is 7.2 per cent lower than the Aldrich, we might conclude that the Aldrich weighted average wage would probably need to be reduced by more than 7.2 per cent to approximate the true wage in the United Stat.es, including the low-paid Southern area. Statistics published by the Massachusetts Bureau of the Statistics of Labor also indicate that the Aldrich sample is weighted on the side of high rates. In its twenty-eighth annual report in 1 8 9 7 3 data are given for 63 occupational groupings in Massachusetts in i860. Averaged, the data disclose a mean wage of $6.62 per week, compared with an Aldrich Massachusetts mean of $7.36.

2. Report on the Statistics of WaRes In Manufacturing Industries. pp. 532-365.

3. Pp. 5-7.

APPENDIX

95

I

A l d r i c h - B u r e a u o f Labor

Ratio

Now l e t us t u r n t o an a n a l y s i s o f t h e d i f f e r e n c e s between t h e a v e r a g e o f t h e A l d r i c h d a t a f o r 1 8 9 1 and t h e Bureau o f L a b o r 1 s a v e r a g e wage f o r the same y e a r . The Bureau o f Labor s t u d y 4 i s c o n f i n e d t o an i n v e s t i g a t i o n o f t h e wages p a i d t o e i g h t o c c u p a t i o n a l groups: Card machine t e n d e r s , d y e r s , loom f i x e r s , male frame s p i n n e r s , f e m a l e frame s p i n n e r s , mule s p i n n e r s , male w e a v e r s , and f e m a l e w e a v e r s . With t h e s e i t i s p o s s i b l e t o compare A l d r i c h d a t a i n s i x c a s e s , d y e r s b e i n g o m i t t e d because n e i t h e r t h e A l d r i c h r e p o r t n o r l a t e r p u b l i c a t i o n s o f t h e Bureau o f L a b o r c o n s i d e r t h e wages o f d y e r s under the c o t t o n g o o d s m a n u f a c t u r i n g i n d u s t r y as such, and male w e a v e r s b e c a u s e t h e A l d r i c h r e p o r t i n c l u d e s no q u o t a t i o n s f o r t h i s c a t e g o r y i n 1891. I n two c a s e s t h e c a t e g o r i e s l i s t e d by t h e A l d r i c h Committee bear d i f f e r e n t t i t l e s , machinists apparently i n c l u d i n g t h e loom f i x e r s , and c a r d s t r i p p e r s b e i n g r o u g h l y e q u i v a l e n t t o c a r d machine t e n d e r s . 5 Weighted averages o f the s i x o c c u p a t i o n a l groups are: A l d r i c h ( a v e r a g e o f J a n u a r y , $7-90 p e r week, and J u l y , $7.88), $ 7 . 8 9 ; Bureau o f L a b o r , $6.38 ( 8 0 . 8 6 p e r cent of the A l d r i c h average o f the s i x o c c u p a t i o n s ; 86.1 per cent o f the A l d r i c h average of a l l o c c u p a t i o n s ) . On t h e assumption t h a t t h e Bureau o f L a b o r sample 6 i s more r e p r e s e n t a t i v e than t h e A l d r i c h s a m p l e , and t h a t t h e Bureau o f L a b o r - A l d r i c h r a t i o f o r t h e s i x o c c u p a t i o n s would be a p p r o x i m a t e l y t h e same f o r o t h e r o c c u p a t i o n s i n

!(•. 19th Annual Report, I90U: Wages and Hours of Labor, pp. 251-252, 852-873. 5. On this point the United States Employment Service's Job Specifications f o r the Cotton T e x t i l e Industry, 1935, P. 59, says that the card stripper's Job i s "frequently combined with job of oard tender." 6. Covering 20k card machiné tenders, 29^ loom f l i e r s , 73 male frame spinners, 1 , 1 8 7 female frame spinners, 223 mule spinners, and 3,635 female weavers, and including establishments in Georgia, North Carolina, and South Carolina, as well as Maine, Massachusetts, New Hampshire, Pennsylvania, and Rhode Island.

76-78,

96

COTTON TEXTILE WAGES 7

the i n d u s t r y , w e m i g h t c o r r e c t the i860 A l d r i c h f i g u r e by this ratio. B y so d o i n g , h o w e v e r , w e s h o u l d o v e r l o o k the fact t h a t t h e S o u t h e r n l o w - w a g e a r e a r e p r e s e n t e d a l a r g e r p r o p o r t i o n o f the e m p l o y e d w o r k e r s in the i n d u s try i n 1 8 9 1 t h a n it d i d i n i860. We must therefore b r e a k d o w n the 1 8 9 1 B u r e a u of L a b o r a v e r a g e into a v e r a g e s f o r the S o u t h e r n a n d N o r t h e r n d i s t r i c t s s e p a r a t e l y . W h e n this is d o n e w e f i n d that the a v e r a g e w a g e of the S o u t h e r n w o r k e r s w a s $ 4 . 1 4 6 3 a n d the w a g e of the N o r t h e r n workers $6.9297• T h e r a t i o to the A l d r i c h a v e r a g e of a l l o c c u p a t i o n s t h u s b e c o m e s 5 2 . 5 5 p e r cent i n the S o u t h a n d 87.83 p e r cent i n the N o r t h . It w i l l b e n o t e d that the N o r t h e r n p e r c e n t a g e d o e s n o t d i f f e r w i d e l y from the W e e k s - A l d r i c h u n w e i g h t e d m e a n r a t i o of 9 2 . 8 w h i c h w e d i s c o v e r e d i n the i860 d a t a . To m a k e a c o r r e c t i o n of the A l d r i c h i860 a v e r a g e , w e n o w a p p l y the 1 8 9 1 S o u t h e r n w a g e r a t i o to the A l d r i c h i860 a v e r a g e a n d w e i g h t b y the n u m b e r o f w o r k e r s g a i n f u l l y e m p l o y e d i n the S o u t h , a c c o r d i n g to the Census. 8 W e do the same for the N o r t h , w i t h the f o l l o w i n g r e sults: 5 2 . 5 5 p e r cent o f $ 4 . 9 4 5 8 is $ 2 , 5 9 9 87.83 p e r cent of 4 . 9 4 5 8 is 4.344

111,876

w o r k e r s at 4.344 = 1 0 , 1 5 2 w o r k e r s at 2 . 5 9 9 = 122,028

485,989-344 26,385.0^8 512,374.392

A v e r a g e w a g e of all w o r k e r s ,

$4.20.

W e c a n m a k e o n e f u r t h e r check to see w h e t h e r our correction device has produced reasonable results. W e c a n ^ m u l t i p l y o u r w e e k l y w a g e b y the p r o b a b l e n u m b e r of w e e k s w o r k e d i n the c o t t o n t e x t i l e i n d u s t r y i n i860 a n d c o m p a r e t h i s a n n u a l f u l l - t i m e w a g e f i g u r e w i t h the

7. A similar assumption, regarding the ratio of the Bureau of IAbor sample of "selected occupations" to "all occupations" in 1914, was made hy Paul H. Douglas in Real Waffes In the United States, 1890-1926, pp. 90-91, in transforming the Bureau of labor estimates of full-time weekly wages in "selected occupations" from 1890-1914 into estimates of average full-time wages for all workers employed. 8. 1900 Census of Manufactures, Part 3, 54-56.

APPENDIX I

97

average annual earnings figure obtained by dividing total wages paid during the year, as disclosed by the i860 Census, by the average number of workers employed. 9 The Weeks report in the 1880 Census gives the following information regarding time worked in i860 by 18 of the mills queried: Number of Mills 10 1 3 1 1 1 1 18

Months per Year

12 11 4/5 11 1/2 ll 1/5

11 10 4/5 10

Weighted Months 120.0 11.8 34.5 11.2 11.0 10.8

10.0

209.3

Average, 11.63 months. Multiplying this by 4 l/3, the average number of weeks in a month, we find that 50.4 weeks were worked by the firms Included in the study. This gives a full-time annual wage of $211.68, compared with a census figure of average annual earnings of $ 1 9 6 . Is this difference significant? We can turn for enlightenment to census earnings data and full-time weekly earnings estimates since 1899» when both became available for census years. Let us compute average annual earnings for the census years from 1899 to 1925 and compare them with the full-time wage estimates made by Professor Douglas. 1 0 For the years before 1914 we shall use the figure for time worked in i860 as a multiplier (for want of any better estimate); for the years since then we can compute new multipliers by dividing average annual earnings by per 9. The i860 Census year ended on June 30, i860, but since our i860 wage data are based upon rates in January and July, the wage statistics used should he roughly as representative of the fiscal year ending June 30, i860 as of the calendar year ending December 31, i860. 10. Op. clt., pp. 124 and 258. Average annual earnings estimated by dividing total wages paid each year by average number of employees.

COTTON TEXTILE WAGES

98

capita weekly earnings statistics gathered by the Bureau of Labor Statistics. 11 The results are as follows: Year

i860 1900 1904 1909 1914 1919 1921 1923 1925

Average Annual

Per capita Weekly-

Earnings

Earnings

286

305 351

387

$ 7.64 16.8k

17.65 17.59

16.03

Multi- Fullplier time

Hatio of Annual Earnings to

Weekly

Annual Full-•time Aj

Wage

Wage

$4.20 6.09 6.73 7.81

$196

825 797 81a 793

Fulltime

8.69 18.22 18.31 19.63 18.62

50.40 50.40 50.40 50.40 50.65 49.00 45.15 47.84 49.56

Wage

$211.68 307.00 339.19 393.62 440.15

92.5 93.0 90.0 89.0 88.0

826.70 939.10 922.81

96.2 90.0 86.0-

892.78

92.2

The 1900 census year ended on May Jl, 1900. The full-time weekly wage figure is an average of the fulltime wage in 1899 ($5-75) and 1900 ($6.42), which should be fairly representative of the actual wage in the census year. The only ratio that is far out of line with the i860 estimate is the I925 ratio. This can probably be explained on the basis of a large amount of part-time employment on the part of workers employed steadily throughout the year 1925- ± S This would account for the low per capita weekly and annual earnings figures and the increase in size of the multiplier. We may conclude, therefore, that our i860 estimates are not inconsistent with the available evidence. Hourly Wages in the United States Hourly wage rates of employees covered by the Aldrich report have been computed by dividing the daily rates by the number of hours worked by the respective

11. Per capita weekly earnings data are averages of monthly data published currently by the Monthly Labor Review. 12. Data published monthly at the time by the Monthly Labor Review show that 29.6 per cent of the cotton textile establishments reporting this information in 1925 were operating on e. part-time basis, compared with 14,4 per cent in 1 9 2 3 .

99

APPENDIX I

establishments (12 in the case of three establishments and 13 in the other). The weighted averages of these rates are: January, 6.75 cents: July, 6 . 7 8 cents; average for the year, 6 . 7 6 5 cents. The unweighted average of the rates is 9 . 0 6 cents, compared with an average for the Weeks data of 9 . 5 8 cents. Why are the Aldrich hourly figures lower thai; the Weeks figures, when the Aldrich weekly figures are higher than the Weeks? The reason apparently is to be found in the fact that the firms covered by the Aldrich report were working longer hours than the average for the United States at the time. Evidence for this view is available in the Weeks report, which gives information on hours for a larger number of mills than furnished details on wages in i860. 13 a weighted weekly average of the Weeks data may be computed as follows: Number of Mills

Hours per Day

Hours per Week

Weighted Hours per Week

2 16 3 _4 25

10 11 11 1 / 2 12

60 66

120 1,056 207 288 1,671

69

72

Average, 66.84 hours. If we add to this sample the four Aldrich establishments, we get the following results: 3

29

12 13

72 78

216 18 1,965

Average, 67-76 hours. In the South it is probable that the hours worked were in the neighborhood of 6 9 . Broadus Mitchell, in his biography of William Gregg, Factory Master of the Old South, 14 states that the hours of labor worked at Gregg's Graniteville, S.C., mill in 1849 were from 12 to 12^ a day, 15 or from 72 to 7 5 a week. It is difficult to tell 13. See p. 328. 14. P. 60. 15. An article in De Bow's Bevlew for January, 1 8 5 0 , pages 27-28, is quoted to this effect.

100

COTTON TEXTILE WAGES

how much hours may have been reduced In the South in the ensuing decade. In the North, it appears from the Weeks and Aldrich data, they were reduced about 6.3 per cent during ths period. 1 6 If the reduction was of a similar magnitude in the South, the hours worked in i860 would probably range from 67.46 to 70.28, or an average of 68.87. Weighting these averages by percentage of workers employed in the two sections of the country we obtain: 91.7 at 67.76 8.3 at 68.87 100.0

6,214 572 6,786

Average, 67.86 hours. If we now divide our estimate of weekly wages in i860 by this estimate of hours worked per week, we shall obtain an estimate of hourly earnings at the time that is more accurate than the estimate based upon the Aldrich data alone. The revised estimate is 6.19 cents per hour. Wages in Great Britain The task of estimating cotton textile wages in Great Britain for the period under review is easier than 16. Weeks data, I85O: Mills

Daily Hours

Weekly Hours

Weighted Hours

11

66

264

12

69 72

69 648

75 78

225

1 9

12è

3 1 Aldrich data:

13

1 (I85I)

12

72

1

13 14

78

(1849)

1 (1849) _ 1 (1853) 22 Average, 7 2 . 2 7 . lower.

78

84

12

72 1,590

The i860 average, 67.76, is 6.3 per cent

APPENDIX I

101

In the case of the United States, because George Henry W o o d made an exhaustive 3tudy of the subject in connection with a monumental Investigation of The Statistics of Wages in the United Kingdom during the Nineteenth Century which he and A. L. Bowley undertook for the Royal Statistical Society at the turn of the c e n t u r y . 1 7 Mr. Wood's History of Wages in the Cotton Trade during the Past Hundred Years was published in 1910 and gives annual estimates of full-time weekly wages for all of the years from 1806 to 1906. His estimate for i 8 6 0 is lis. 7d. (equivalent to $2.82) for a 60 hour week, or 2s. 3d. (4.7 cents) per hour.18 The British full-time weekly wage was thus 67 per cent of the American and the hourly wage approximately 76 per cent of the American wage.

17. An Introductory article, by Professor Bowley on "Changes In Average Wagea (Nominal and Beal) in the United Kingdom between i860 and I89I" was published in the June 1895 issue of the society's Journal. Discussions of specific industries 'began to appear in the December 1898 Issue with an article by Bowley on agricultural wages. 18. Wood, op. cit., p. 128. This Is for factory operatives only, excluding the few hand-loom weavers who were still employed at 6s. 3d. ($1.50) per week, which may be regarded as the minimum of subsistence wages for the era, Inasmuch as that wage had been stabilized at this low level from 1 8 3 5 on.

Appendix II PAYMENTS IN KIND It has long been the practice In the cotton textile industry of the United States for companies locating in country areas, where ordinary housing facilities were inaccessible, to provide houses for their employees and charge a nominal rent for them much lower than would be charged by private landlords for similar houses. The usual custom also has been to furnish water, fuel, and light either free or at a considerable discount from prevailing commercial charges. In the early days of the New Kngland industry boarding houses were also provided for unmarried employees. At times a small plot of land was furnished with the family house for use as a garden or for pasturage for cows. The Weeks Report in the 1880 U. S. Census1 estimated that these contributions in kind would add 10 per cent to the wages received by cotton textile workers in i860. No recent estimate has been made of the value of such payments but certain information is available from which such an estimate can be made. In 1934 the American Cotton Manufacturers Assoiriation made a study of Southern Village Costs, in which data were collected on 50 Southern mill villages. The Association reported that the average rent per room per week was 33 cents, including water and light. The average cost of fuel was found to be 9-2 cents per room per week. The average worker was reported as occupying 1.86 rooms in the house in which his family lived.2 • Herbert J. Lahne made a similar study, three years later, for his book, The Cotton Mill Worker. He reported that there was no change in rentals between 1934 and 1938 and that the charge in the South at that time was 31 cents per room per week.3 He said it was 1. Oji. clt., in Appendix I, p. 331. 2. Og. £it., p. 8. 3. Og. clt., p. 37.

APPENDIX II

105

customary to provide water without charge, consequently we may conclude that the 2 cents difference between the rental charge and the 55 cents for rent, water, and light, reported by the Cotton Manufacturers Association, represented light. Multiplied by the number of rooms per worker, the charge per worker becomes 57-66 cents for rent, 5.7 cents for light, and 17-1 cents for fuel. Now let us attempt to estimate commercial charges for these items at the time. Bulletin 699 of the U. S. Bureau of Labor Statistics (Changes in Cost of Living in Large Cltle3 in the United States, 1915-41) gives estimates of the cost of housing, fuel, electricity, and miscellaneous items, including water, in 55 cities in June, 1941. Included in the 3tudy are Atlanta and Richmond, which have been chosen for our purposes because the main textile centers of the South are located in the states of North and South Carolina, which lie directly between Atlanta and Richmond, and there are also Important textile mills in Georgia and Virginia in which the two cities are located. Therefore, the average of living costs in these two cities should reflect the changing status in the textile areas as well as any city indices can. The average cost of "fuel, electricity, and ice" can be broken down into the components in which we are interested, as follows: Total Per cent Cost Fuel Atlanta $87-58 65-0 Richmond 105.45 65-9 Average

Per cent Electricity 25.8 20.5

Amount Amount Fuel Electricity $55.05 $22.5^ 68.17 21.21 61.61

21.88

Since the typical textile worker lives in a four-room house, 4 the fuel cost would be $15.15 per room - 29.1 cents per week, or 5^-1 cents per worker. The electricity cost would be $5.47 per room - 10.5 cents per week, or I9.5 cents per worker. In June, 1954, the average cost of fuel and electricity in Atlanta and Richmond was 1.1 per cent higher than in June, 1941, so the cost of

COTTON TEXTURE WAGES fuel per worker was 54.6 cents in 1934 when the study of Southern Village Costs was made, and the cost of electricity was I9.7 cents. Water represented 1.7 per cent of the cost of Miscellaneous Items which cost $313-30 in 1941, or $5.33 a year. This is equivalent to 4.76 cents per worker per week, which we shall assume was the same in 1934, inasmuch as we have no index of changes in the cost of this relatively insignificant item alone from year to year. The difference "between the commercial cost of light and the average charge made to occupants of company houses was therefore 16 cents (19.7 - 3-7)• This difference is as great as this probably because, as Mr. Lahne reveals,5 half of the mills include all or some of the electric current in the rent, and some of these mills were undoubtedly included in the Manufacturers Association sample. The difference in the cost of fuel is 37-5 cents. This difference seems considerable, but it has been estimated that Southern mill operatives burn as much coal as is burned in working class tenements even in the North, 6 consequently the estimated difference is reasonably accurate, in all probability. As was pointed out in a paper submitted to the Southeastern Economics Conference at Atlanta in 1928, "mill houses are often not plastered, are invariably built without cellars, and consequently are very difficult to heat." 7 Rents in 1934 must be estimated by a different method, since it is likely that rents for cotton mill houses would be considerably less than for working class houses in city areas. We shall rely for this purpose upon data gathered by the University of Virginia Institute for Research in the Social Sciences and published, : n 1930, in a study on Labor in the Industrial South. !.he authors 8 reported that 25 cents a room was the customary charge per week for houses which, if controlled by 5. rbia., pp. 37-8. 6. National Industrial Conference Board Special Eeport Wo. 8 (on the cost of living of textile workers in 1920), p. 13 - quoted "by Southeastern Economics Conference, 1928: The Industrial South, P. 53. 7. The Industrial South, p. 53. 8. Abraham Berglund, George T. Starnes, and Frank T. De Vyver.

APPENDIX II

105

private landlords, would rent for from two to three times as much. 9 Taking an average of 2.5, the commercial rental would have been 62.5 cents at the time. By 1934, as we have seen, rents for company houses had been raised to 31 cents per room, while average commercial rents in Atlanta and Richmond were 30 per cent lower. If rents for privately owned housing in textile mill villages declined to the same extent, the rental in 1934 would be reduced to 43.8 cents per room, or only 12.8 cent s above the charge of 31 cents for company housing. Per worker the difference would be 23.8 cents. Thus the best estimate we can make of the value of contributions In kind to the Southern textile worker's weekly wage in 1934 is: 23.8 cents in rent, 4.76 cents in free water, 16 cents In light, and 37-5 cents in fuel; a total of 82 cents. Adequate information is not available on the value of payments in kind in New England mill villages, although we do know that 39*7 cents was the average rent per room in 1 9 3 4 , 1 0 evidently considerably below the customary commercial rental. Since only about 12 per cent of the New England workers lived in company houses at the t i m e , 1 1 the average national picture will not be greatly affected however we estimate the New England payments. If we assume that the New England mill owners made as great a contribution in kind to the wage of their workers as the Southern mill owners, we shall arrive at the following estimate of total average weekly earnings of all cotton textile workers In the United States in 1934:12 9. Og. clt., p. 119. 10. Monthly Labor Review, June, 1936, pp. 1492-5, quoted by Lahne, og. clt., p. 30. 11. Estimated on the assumption that mills hare been disposing of their houses gradually since 1920. According to Mr. Lahne, op. clt., p. 30, 20 per cent of the workers lived In company houses in 1916 (and we assume the same percentage in 1920) and 10 per cent in 1936 (28.4 per cent of 17,000 workers out of 50,000 workers covered In the sample he studied). 12. Lahne quotes a B.L.S. study to the effect that 79 per cent of the Southern workers lived in mill houses In 1934 (op. clt.. p.

106

In Company Houses Not In Company Houses Average

COTTON TEXTILE WAGES Per cent of Workers

Weekly Earnings

61

$12.58

¿2

12-58

Weekly Earnings Weighted Including Earnings Payment In Kind $13.40

8.17 4.90 $13.07

If ve assume that the New England mill owners made as great a contribution In rent as the Southern employers but no other type of contribution, we obtain the estimate on the following page. We can therefore use either wage figure as typical of the United States without fear that our estimate for payments in kind in New England has Introduced" any significant error. Let us now project our statistics backward several years (to estimate the extent of payments In kind in the period before rents In company houses In the South were raised from the 25 cents per room which prevailed (Footnote 12 continued). 3 5 ) . Employment figures are from the 1933 Census of Manufactures, for the New England and principal Southern States. Percentages of workers in company houses derived as follows: NORTH Number of Workers (Thousands)

Per cent in Company Houses

91

12

Number In Company Houses 11

SOUTH

257

79

203

TOTAL U.S. 348

61

214

The 1 1 , 0 0 0 workers in New England represent 3 Per cent of the total number of workers in the United States.

APPENDIX II

107

Per cent Weekly Weekly Earnings Weighted Earnings including Earnings Payment in Kind In Company Houses in South In Company Houses in New England Not in Company Houses

58

$12.58

$13.40

7-77

3

12.58

12.82

.38

12.58

Average

4.90

$13.05

from before World War I to the advent of N.R.A. in 1933) 13 and forward to 1945- We shall begin with rents alone: B.L.S. Atlanta-Richmond

(1914 = 100)

Commercial Payment In Kind Per Bent per (Difference from Wortrer Room rent of Company (1 1.86) Houses) (1934 = 100)

1914 104.6 .458 .208 100.0 .387 1920 140.3 .643 146.7 .393 .731 1924 .458 .852 154.6 .708 161.7 1928 .716 144.9 .385 158.5 .635 120.1 114.8 .276 .526 1932 .513 .438 100.0 .128 .238 95.6 1954 .425 .214 1935 99.7 95.5 .115 1938 103.2 .163 107.9 .303 .473 108.1 .270 1945 .145 113.1 .495 Now let us take fuel, light and water, using the B.L.S. Index for Fuel, Electricity, and Ice: (See next page). Adding the total payment in kind to the average weekly money earnings and weighting by the percentage of

13. See Appendix IT for an explanation of the increase in rents. 14. Savannah-Washington in 1914 and 1945 because no data are available on rents in Atlanta and Richmond in those years. See Appendix Iv for a further explanation.

108

COTTON

TEXTILE

WAGES

in K i n d

I n Kind,

per worker

including R e n t

77.1

.1*1*9

11*2.8 128.5 126.3 100.1 100.0 99.9

.831 .7^8

.836 1.562 1.600

.718

1.431»

.583

1.096

Average FuelElectricity (1955-39 = 1 0 0 ) 1911*

78.0

1920

11*1*. 1*

1921*

130.0

1928

127.7

Index (1931* = 100)

101.2 101.1 100.0 100.3 112.5

1932 1931* 1935 1938 19**5

T o t a l Payment

Payment

Atlanta-Richmond.

.582

.820

.576

.790

99.2

.577

.880

111.3

.61*8

.918

115

w o r k e r s occupying company houses,' a n d weighting the average m o n e y earnings alone by the percentage of workers

15. This percentage w a s derived as-follows: HOHB

O 0

0 §

§

1 s I ¡5 g *

191U 1920 192U 1928 1932 1931* 1935 1936 19U5

19U 217 195 155 90 91 83 55 55

c •H -P C ty 0 3 ^ CH O ft, O 20 20 18 16 1U 12 12 10 7

SOUTH

0 n 3 O «

0 to § ^ &B 0 3 0 A p. ffl 1 5 1 § 1 3 § 1 e Bom

38.8 U3.1* 35.1 2U.8 12.6 3.1.0 10.0 5.5 3.9

151 189 219 261 209 257 261* 230 230

TOTAL U . S .

c

? am a & 0 8 3 OH 71 72 73 71* 77 79 75 67 60

^ 0 h & ® 0 3 a 0 1 1 1 1 BUM S% B 107.2 136.1 159.9 193.1 160.9 203.0 198.0 151*. 1 138.0

-3 c A a 3 h 3 S q a ©3 s a c u i 0 II b &* —' 0 I « 0 W P*

3t5

1*06 1*11* 1*16 299 3W 31*7 285 285

li(6.0 179.5 195.0 217.9 173.5 21l».0 208.0 159.6 1U1.9

1*2 1*1* 1*7 52 58 61 60 56 50

E m p l o y m e n t f i g u r e s a r e f r o m the n e a r e s t p r e c e d i n g census w h e n no c e n s u s w a s t a k e n i n the same y e a r , e x c e p t f o r 1938 a n d 191*5 w h i c h are b o t h f r o m the 1 9 3 9 census.

P e r c e n t a g e of w o r k e r s in company

h o u s e s in the N o r t h i n t e r p o l a t e d a s e x p l a i n e d in footnote 11, a b o v e . P e r c e n t a g e o f w o r k e r s in c o m p a n y h o u s e s i n the S o u t h in 1928 is a n a v e r a g e of two e s t i m a t e s m a d e b y two surveys q u o t e d b y Lahne, op. clt., p . 35.

P e r c e n t a g e s f o r 1 9 1 4 , I93I*, 1938, a n d I9U5 are those

APPENDIX II

109

not in company houses, we obtain the following results:

Total Earnings of Workers In Company Houses

1911» 1920 1921» 1928 1932

193V 1935 1938

19k5

$ 8.W 22.53 17.51» 16.93 11.95 13. 1*0 13.85 1U.91 30.30

Per cent In Company Houses

I»2 W» hi

52 58 61 60 56 50

Weighted Earnings

3 9 8 8 6 8 8 8 15

56.2 91.3 2U.1* 80.U 93.1 17.U 31.0 35.0 15.0

Earnings of other workers $ 7.6k 20.97

15.91» 15.50 10.85 12.50 13.06 11».03 29.38

Per Cent

Weighted Earnings

58 56 53

W»J.l 1171». 3 8UU.8 7W».0 i»55.7 U90.6 522.1» 617.3 11*69.0

US k2

39 UO 4U 50

Average Total Weekly Earnings of All Workers

* 7.99 21.66 16.69 16.21» 11. "»9 13.08 13.53 11». 52 29.81»

The total earnings of workers in company houses thus exceeded their average money earnings by the following percentages: I9I4 I92O 1924 I928 I932 I934 I935 1938 I945

11..0 7 - ,4 10.,0 9 . .2 1 0 , ,1 6.• 5 6 .,0 6 . >3 3- .1

If we take an average of the excess In 1914, 1924, and 1928 - typical years before the employers began reducing their traditional contributions in kind and years unaffected by the inflationary influences of 1920 and the deflationary Influences of 1932 - we find that

(Footnote 15 c o n t i n u e d ) . c i t e d by Lahne, pp. 3 5 - 6 . The other percentages are i n t e r p o l a t i o n s on the assumption of a steady trend upward t o the maximum p o i n t i n 1934, and downward from then.

110

COTTON TEXTILE WAGES

the total earnings exceeded the money earnings by 10.1 per cent, practically identical with the percentage estimated by the Weeks report as prevailing in i860. There is, however, one complicating factor which has been left out of these calculations, and that is the practice of company stores charging higher prices than Independent stores for merchandise purchased by mill operatives. "There were complaints of overcharging almost from the beginning of the industry," as Mr. Lahne states,1® "and the complaints have not abated 30 far as the remaining stores are concerned." Estimates of this overcharging have ranged all the way from 2.3 per cent to 100 per cent, 17 but the only scientific investigation of the problem was the study made by the N.R.A. Committee on Company Scrip in 193^- Two samples of food costs in both company and independent stores in South Carolina were analyzed. One sample, taken in the week of June 22-27, revealed the 2.3 per cent estimate. The other sample, taken in the period July 28-31. showed that prices in the company stores were 3-6 per cent higher than in the independent stores. If we take an average of these two estimates, 3 per cent, we shall obtain the most accurate estimate obtainable for our purposes. Of course, the overcharging may have exceeded this figure In previous years, but there is no way of allowing for this possibility. The 3 per cent figure is at least a conservative one and, If we use it in making deductions from our estimates of payments in kind, we shall at least not underestimate the extent of such payments throughout the period of our study. Previous estimates of overcharging made references to purchases of clothing as well as food. It is also likely that the overcharging would extend to some house furnishings as well. If, therefore, we apply the 16. 0j> clt., p. h8. 17. Industrial Commission Peport. 56th Congress, 1st Session, Vol. VII, p. 79; U.S. House of Representatives, Subcommittee of the Committee on Labor, Hearings on H.R. 9072. 7^th Congress, 2nd Session, pp. 273 and. 765» National Recovery Administration, Division of Review, Work Materials No. Report of the Committee ön Company Scrip, The Economic and Social Implications of the Company Store and Scrip System, p. 66.

APPENDIX II

111

3 per cent figure to an estimate of the cotton textile worker's total budget for expenditures on food, clothing, and house furnishings, we shall obtain an approximation of the extent of the overcharge, to deduct from our estimates of payments in kind. In January and February, 1920, the National Industrial Conference Board made a study of living costs in Charlotte, N.C., and Greenville, and Pelzer, South Carolina. It found the cost of maintaining a wageearner's family living in a mill-owned house in those communities to be $1,438 in Charlotte, $1,39^ in Greenville, and $1,347 in Pelzer; average $1,403. This was 73.46 per cent of the cost of the B.L.S. average Atlanta-Richmond budget in December, I919. 1 8 Applying this percentage to the cost of food, clothing and house furnishings in Atlanta-Richmond in June, 1941 ($699.28), we obtain $513-69 as the probable cost of these items to a cotton textile worker's family, living on its lower standard of living, in 1941. This is equivalent to $9.88 per week - $2.47 per room, and $4.59 per worker ($2.47 x 1.86). Three per cent of this is 14 cents, the probable overcharge for purchases made by workers in company stores. We can obtain similar estimates for other years by projection of the B.L.S. index numbers for food, clothing, and house furnishings, weighted by their relative importance in the working class budget,, shown on the following page. Now what proportion of workers in the industry had to buy their merchandise in company stores? Mr. Lahne estimates that in 1938, in the South, "about 27 per cent of the workers were employed by mills which operated company stores." 19 This would be 40 per cent of the workers who lived in company houses (27 divided 13. Atlanta-Richmond estimate obtained lay projecting the B.L.S. estimate for June, 1941, hack to 1919 as follows:

Atlanta December 1919 151.2 June 1941 103.3 19. 0g. cit., p. 47.

Index Numbers Richmond Average 134.8 143.00 103.3 113.15

Cost of Total Budget 138.6 $1,910.56 100.0 1,378.47

COTTON TEXTILE WAGES

112

Clothing

•Ö

tí

c

10

e 01

05


d t,

«