in preference to the more efficient and more highly paid men in the same class. 89. Where the piece prices were the same it was found that the earnings of individuals showed wide variations up to 20 cents an hour. These variations are often accentuated by the practice of giving the more proficient workers a higher piece price. 90. Examples of the practice of promotion with changes in work and increases in wages were found in other establishments and it is a widely prevalent practice in American engineering shops. The most efficient worker thus has the opportunity of increasing his basic rate by demonstrating his ability through higher output at the lower rate, and the possibility of receiving such promotion gives the workers an incentive which they value. 91. Workers are not retained unless they are able to reach a reasonable standard of efficiency, and in some plants there appears to be an absence on production work of men approaching middle age. Simplification of Wages. 92. The use of the metric system is, of course, an advantage in calculating wages, but we noticed that wage rates are usually fixed at a definite figure which is easy to handle. For example, a time rate may be 60, 70, 75, &c., cents per hour. When an adjustment is made it is merged in a new rate. In no case did we find the practice in force, which is so often to be found in Great Britain, of making a percentage reduction or increase on the old rate as a separate calculation. The consequent saving in clerical staff in making out wages schedules is considerable and, in addition, there is less friction and inconvenience in determining the aggregate weekly wage. Hours of work. 93. There is considerable variation in the number of hours worked as between different establishments in the same industry or in the same district. In the large establishments in the North and in trades covered by union agreements, the weekly hours are usually 44 to 48. Many plants work 50, 55 and 60 hours. a week, both on day and night shifts. Women in certain States work at night the same hours as the men. In one establishment a night shift of 62 hours per week was found. On the other hand, in another establishment where there are two day shifts, each shift works 44 hours per week, the turn on the afternoon shift being free for the week-end from Friday night until Monday afternoon. The hours in the South usually range from 50 to 60 per week. The average for the United States is a little over 50 hours per week. 94. While additional payment is often made for overtime work, this is not general, and it is usual for no extra payment to be made for night work. Many workers prefer night work as 62496 B 2 the longer hours enable higher earnings to be made. Consideration is being given to the question of the length of the working week and a five days' week appears to be a growing practice in preference to the Saturday half day which is not yet general but is extending. Training Schemes. 95. Many of the large industrial enterprises maintain apprentice schools and workshops which train skilled men, many of whom are fitted to occupy positions of responsibility as a direct result of their training. The new conditions. in industry have, however, necessitated a readjustment in the old form of apprenticeship. The attraction of high wages in semi-skilled employment makes it difficult to recruit youths for apprenticeships under the old form of indenture, where the apprentice receives a low learners' wage with promise of becoming a skilled man after several years' training. The new forms of training range from the formal indenture in all branches of the trade, to training in the workshop for a specific job and only for the specific job, and during the period of training, which is usually from three to four years, the wages paid are from (for example) 40 cents per hour, rising each six months up to 75 per cent. of the skilled rate at the end of the period of training. In many cases firms are able to recruit skilled men from among immigrants from Northern Europe to render special schemes of training for the higher grades unnecessary. 96. There has been a considerable development in the last few years in the establishment under public education of trade and vocational schools. In 1917, the Federal Board for Vocational Education was created by Congress under an Act known as the Smith-Hughes Act, passed in that year. Under the Act Federal funds were allotted to the States specifically for the following forms of vocational education :-Agriculture; trade and industrial; home economics and the training of teachers. All the States have taken advantage of the distribution of Federal funds whereby for every dollar spent by the Federal Government, the State, or local authority, or both, expends an equal amount. The total expenditure of Federal, State and local money under the Vocational Educational Act has increased from 2,610,000 dollars in 1918 to 20,940,000 dollars in 1925. At the same time the enrolment in Federal aided vocational schools has increased from 164,186 in 1918 to 659,370 in 1925. Both employers and trade unions take a keen interest in vocational education and promote schemes jointly. In many cities arrangements are made whereby the student works alternately in the plant and in the vocational school. While he is at school he is replaced at the plant by another student. Under this plan the school is saved some expense in equipment and the youth is able to earn while he is still under part-time tuition. Industrial Disputes. 97. Notwithstanding the general level of prosperity since the depression in 1921, the United States has not been free from industrial disputes. We set out in Appendix No. 8 a table showing the number of disputes recorded by the Bureau of Labour Statistics for the years 1921-1925 (the last year available). The table is not exhaustive, as disputes may occur which are not reported to the Bureau, and there is no record available of the unreported disputes. 98. In Appendix No. 6 we describe the present position of conciliation and arbitration in industrial disputes. Disputes between Unions. 99. Stoppages of work in consequence of demarcation disputes rarely occur. It is the practice of nearly all unions not to allow their members to cease work pending settlement of a question of demarcation. It is not unusual for the employer to determine which craft should perform the work pending adjustment of the matter between the unions. The fact that a stoppage of work is avoided means, of course, that employers are able to make contracts without fear of interruption owing to disputes between unions and there is no loss of wages to the men. 100. In the Building Industry such disputes are settled by reference to a joint board of employers and employees established for the purpose, known as the National Board for Jurisdictional Awards in the Building Industry. With the exception of the carpenters all other building trade unions, of which there are sixteen, accept the decisions of the Board. The Board meets four times a year or more often if necessary. Its meetings are open to the public. It is interesting to note that the employers' organisations represented on the Board include the American Institute of Architects, and the American Engineering Council, in addition to the National Association of Building Trades Employers, and the Associated General Contractors of America. Safety work. 101. A good deal of attention has been paid in recent years in the United States to safety work and to the " safety first movement. The action taken in this direction is very valuable but the position in the United States in the matter of industrial accidents is still serious. In Appendix No. 10 we refer to factory legislation and quote certain official figures as to the number of industrial accidents. Safety work should supplement and is not a substitute for effective factory inspection and factory legislation such as we have in this country. In Appendix No. 16 we refer to workmen's compensation legislation. 62496 B 3 PART IV.-OTHER ASPECTS OF INDUSTRY. 102. As indicated in paragraph 6 we have found it desirable to refer to certain important aspects of industry which forced themselves upon our attention during our visit. Some of these we have already dealt with; in addition there are the following: Management, Standardisation and simplified practice, Interchange of information, Merchandising methods, Taxation, Research work, and Management. 103. A gradual drawing away from the old type of ownermanager has been apparent for some time in America, and there is growing up a class of management specialists. The development of large units in industry has given clearer definition to the function of management which has tended to assume a new status in relation to capital and to labour. 104. Management is becoming a profession distinct in itself. The management of a business is placed in the hands of a man who is held responsible to the owner or Board of Directors for the successful operation of the business. Management is given a free hand, and is charged with the duty to return a reasonable percentage on capital invested, and to that end to have satisfied workpeople, who will co-operate in securing production. Management is, of course, responsible for labour policy and is able to deal promptly with any adjustment of working conditions or methods that may be found desirable. Even in small enterprises this tendency is growing, as it is recognised that the provision of capital is distinct from management, and that the possession of money to invest is in itself insufficient ground for participation in management. Those who fill executive offices are selected according to ability, and personal relationship with those already serving in the business, or having a large financial interest, is of small importance compared with personal merits and qualifications. 105. The rapid expansion of industry and the success of individuals who have risen from low posts to high positions by their own merits and capacity has assisted largely to create the tradition that efficient management must be recruited from all possible sources, and appointments made only on the basis of knowledge, ability and experience. It is a characteristic feature of American industry that many of those occupying high executive posts have risen from the lowest ranks through merit alone. 106. Management is thus placed in the position of a trustee, and is becoming more and more a separate branch of activity, distinct from ownership, into which all who show knowledge and ability may enter. There have been three important results. Firstly, the technique of management has been greatly improved. Secondly, the duties and qualifications of management are widely discussed and attention is directed to maintaining efficiency and eliminating waste. Thirdly, management is recognising the necessity of securing the co-operation of labour in order to secure the best results. 107. As regards the first, it is the aim of management to obtain a large turnover with small profits at low prices, rather than a small turnover with large profits at high prices. Managers are always on the qui vive for new technical developments, in the control of every detail of production and distribution, and in the last few years there has been considerable improvement in the method of production, lower costs, a higher standard of living, and improved industrial relations. 108 We refer in the section on "Interchange of Information to the wide publicity that is given in the interest of efficiency to all matters affecting industry. The Taylor Society is a forum of the greatest value for the discussion of new ideas as to the functions of management. The American Management Association assists in the exchange of experiences by publishing reports on a wide range of subjects relating more particularly to experiences and new ideas in finance, production, sales and office organisation. Conventions are held which are attended by large numbers of those engaged in management to discuss their problems, responsibilities and opportunities. Surveys of particular branches of industrial activity are undertaken by the Association. The Metropolitan Life Insurance Company maintains a special department with a technical staff for the study of industrial hygiene, industrial relations, sales, business research, engineering processes, and many other problems of management, and all policy holders are entitled to this service There are also organisations supported privately for the study and dissemination of knowledge of special phases of management, such as industrial relations. Persons who have had special experience of management problems are consulted by companies anxious to improve conditions. A great deal of thought and energy is thus directed continuously to the promotion of efficient management in all its phases, including industrial relations. 109. All business takes its character from the head. The main responsibility for promoting and maintaining good relations and confidence in the workshop rests upon management and ability to harmonise relations with labour is assuming greater importance as an essential part of management. It is largely due to the influence of the latter that the need of giving the workers a means of discussing problems of workshop organisation and methods has become recognised. In certain undertakings there 62496 B 4 |