SuppUmenl to Clje Annals; of THE AMERICAN ACADEMY OF POUTICAL AND SOCIAL SCIENCE ^^•v, 1916 Steadying Employment With a Section Devoted to Some Facts on Unemployment in Philadelphia PHILADELPHIA The American Academy of Political and Social Science THE AMERICAN ACADEMY OF POLITICAL AND SOCIAL SCIENCE Origin and Purpose. The Academy was organized December 14, 1889, to provide a national forum for the discussion of political and social questions. The Academy does not take sides upon controverted questions, but seeks to secure and present reliable information to assist the public in forming an intelligent and accurate opinion. Publications. The Academy publishes annually six issues of its "Annals" dealing with the six most prominent current social and political problems. Each publication contains from twenty to twenty- five papers upon the same general subject. The larget number of the papers published are solicited by the Academy; they are serious dis- cussions, not doctrinaire expressions of opinion. Meetings. The Academy holds five scientific sessions each year during the winter months, and it also has an annual meeting in April, extending over two full days and including six sessions. The papers of permanent value presented at the meetings are included in the Acad- emy publications. Membership. The subscription price of The Annals of the American Academy of Political and Social Science is $6.00 per year. Single copies are sold at $1.00 each. The Annals are sent to all members of the Academy, $4.00 (or more) of the annual membership fee of $5.00 being for a subscription to the publication. Membership in the Academy may be secured by applying to the Secretary, 36th Street and Woodland Avenue, Philadelphia. The membership fee is $5.00; life membership fee, $100. Members not only receive all the regular publications of the Academy, but are also invited to attend and take part in the scientific meetings, and have the privilege of applying to the Editorial Council for information upon current political and social question. STEADYING EMPLOYMENT WITH A SECTION DEVOTED TO SOME FACTS ON UNEMPLOYMENT IN PHILADELPHIA The investigation forming the basis for this study was carried on in the Department of Public Works of the City of Philadelphia JOSEPH H. WILLITS, A.M., Instructor in- I.vdcstry, Wiiautox School, University of Pennsylvania PHILADELPHIA The American Academy of Political and Social Science 1916 Copyright, 1916, by American Academy of Political and Social Science AH rights reserved EUROPEAN AGENTS England: P. S. King & Son, Ltd., 2 Great Smith St., Westminster, London, S.W. France: L. Larose, Rue Soufflot, 22, Paris. Germany: Mayer & Miiller, 2 Prinz Louis Ferdinandstrasse, Berlin, N. W. Italy: Giornale Degli Economisti, via Monte Savello, Palazzo Orsini, Rome. Spain: E. Dossat, 9 Plaza de Santa Ana, Madrid. Public officials and committees without number havebeencom- missioned to study the abnormalities of unemploj'ment. But not until 1915, when Morris Llewelljn Cooke, then Director of the Department of Public Works of the City of Philadelphia, assigned to Mr. Joseph H. Willits this duty, had there been, at public ini- tiative and with the facilities of a public office, a thoroughgoing study of the normalities of employment and the relation of indus- trial management and industrial policies to unemployment. ]\Ir. Willits' report to Director Cooke was first published in a small edition by the City of Philadelphia. Because of the limited number of copies originally issued, because this supply is now ex- hausted, and because of the valuable nature of the study, the Academy republishes it here in a revised form. It is particularly appropriate and valuable as a supplement to the larger volume on "Personnel and Employment Problems in Industrial Management." Clyde Lyndon King, Editor. m 1205281 FOREWORD In December, 1914, a meeting of business men was called by Mayor Blankenburg with a view to seeing what steps the Phila- delphia community should take with regard to its unemployment problem. This meeting was attended by Samuel Rea, President of the Pennsylvania Railroad; J. Howell Cummings, President of The John B. Stetson Company; J. W. Van Dyke, President of the Atlantic Refining Company; Franklin Brewer, General Man- ager of Wanamaker's; Louis J. Kolb, of the Kolb Bakery Com- pany; Joseph Steele, of Wm. Steele & Sons Co., builders; Louis Bloc, of the Ford Motor Company, and several members of the Mayor's cabinet. The number of men and women out of employment had at that date not reached so high a total as was experienced during the following January and February. The meeting was called to- gether with the thought of taking all possible steps which might act to minimize the ultimate amount of unemployment. A num- ber of suggestions as to possible lines of action were made. It was the concensus of opinion that the agencies then at work would give the maximum of relief to the immediate situation. The con- ference felt that the municipality should rather acquaint itself with the problem in its broader aspects, to find out what other municipalities were doing in this matter, and to make a general study of the problem of unemployment such as would suggest what steps might be taken to minimize it in the future in Phila- delphia. As there was a vacancy then existing in the position of General Inspector, Office of the Director, Department of Public Works, and as this position was exempt under civil service rules, it was suggested that this vacancy be filled by the appointment of a student of economics qualified to carry on an inquiry into each of the phases of the general unemployment problem. This suggestion having received the unanimous approval of the conference, and after several weeks of search for the right man, announcement was made of the appointment of Joseph H. Willits, 4519 Sansom Street, Instructor in Industry in the Wharton School Foreword V of Finance and Commerce of the University of Pennsylvania. The selection of Mr. Willits was approved by his associates in the faculty of the Wharton School and he was given an eight months' leave of absence in order to give his undivided attention to the work. In this report it will be noted that an effort has been made to get down to the basic causes of unemployment and to describe a standard, which it is believed will, during the next generation, be forced upon any industrial community which is to compete in any large and successful waj- with sister communities at home and abroad. Grateful acknowledgment is hereby made to those employers and employes (as well as others) whose courtesy and cooperation made possible the gathering together of the information which makes up this report. The almost unanimous desire of employers not to have their names mentioned in connection with information furnished makes it unfortunately necessary that cases shall be referred to anonymously. Signed, Morris L. Cooke, Director. INTRODUCTORY NOTE At the outset of this report attention is called to the difference between the unemployed person who can and will work, if he has the chance; and the unemployed person who is unable to work through physical incapacity, or who would "starve to death along- side of a job before he would work at it." The larger amount of advertising that these, "the unemployables," receive, blinds many citizens to the very existence of the first class. From the point of view of immediate community welfare, the problem of the first class is the more important, for it is the degenerating effect of this form of unemployment that drives many self-respecting and capable workers into the "unemployable" ranks. This report primarily has reference to the "unemployed." The handling of the second class is largely, though not altogether, a sociological, not an in- dustrial problem. Joseph H. Willits. VI TABLE OF CONTENTS PARTI Facts of Unemployment The permanency of unemployment, p. 3; the textile industry, p. 5; lace and lace curtains, p. 7; carpet, p. 13; cloth industry, p. 18; hosiery, p. 20; the clothing industry, p. 21; industries manufacturing electric and steam railway equip- ment and ships, p. 27; the building trades, p. 29; the longshoremen, p. 29; agricultural labor, p. 31 ; department stores, p. 32; regularity of employment, p. 33; labor union statements, p. 34; miscellaneous industries, p. 35. PART II The Cost of Unemployment To the employe, p. 37; to the employer, p. 43. PART III The Increase of Knowledge about Unemployment Canvass by Metropolitan Life Insurance Company, p. 48; canvass by State De- partment of Labor and Industry, p. 48; study on unemployment by Consum- ers' League, p. 49; courses in unemployment, p. 50. PART IV The Management of Employing Concerns in Its Relation to Unemployment Obtaining and analyzing the facts in each individual plant, p. 56; incomplete methods of determining costs, p. 58; maintaining an excessive labor reserve, p. 59; reduction of the labor turnover, p. 63; better methods of hiring and discharging help, p. 71; better methods of training help, p. 75; reducing the fluctuations in employment, p. 76; closer cooperation between the manufac- turing and selling ends of a concern and the standardization of product, p. 77; abuses, p. 77; time lost waiting for dye (or other materials), p. 84; lack of balance between departments, p. 86; stock taking, p. 86; limitation of the amount an employe is allowed to earn each week, p. 87; frequent changes in standard daily production policy of factories according to volume of orders in sight, p. 87; manufacture to stock, p. 88; miscellaneous practices by em- ployers which lessen or increase the burden of unemployment, p. 88; giving notice of lay-off, p. 88; dovetailing of trades, p. 88; loans to employes, p. 89; retaining all of the employes' time at fractional productivity, p. 89; enforcing needless expense on employes during periods of unemployment, p. 90; part time employment, p. 90; times of pa3Tnent, p. 91 . PART V The Duty of the City Government Municipal work, p. 92; a municipal employment bureau, p. 95; a municipallodg- inghouse, p. 101; the duty of the consumer, p. 101. vii PART I FACTS OF UNEMPLOYMENT IN PHILADELPHIA The most fundamental fact about unemployment in Phil- adelphia or any other American industrial center is that we know practically nothing about it. We do not know its extent; whether it is increasing; in what industries it exists; just what are the dif- ferent causes that bring about lost time; nor just how unemploy- ment affects the worker's standard of life, his work and his citizen- ship, as well as the efficiency of the plant. Not only do we not know, but we do not have any available information to which we can turn. So far as definite knowledge is concerned, we are still "up in the air." The information collected by the various branches of govern- ment — national, state and city — is still most vague and general in character. Every ten years the representatives of the United States Census come to Philadelphia and collect figures which show for one year the number of wage-earners engaged each month in each separate industry.^ The State Department of Labor and Industry at irregular intervals collects from a large number of representative firms a statement of the maximum and minimum number employed during the year, and the dates on which these high and low points in employment occurred.^ Such information, while it is a step in the right direction, throws but the barest light on the extent, nature and causes of unemployment. The only local investigations have been made by the Consumers' League and by Phipps Institute. Since these investigations were not primarily concerned with unemployment, the information furnished on that subject is necessarily scanty. The lack of definite knowledge goes deeper than the absence of public reports, statistics and investigations. A large percent- age of emplo3'ers have made little analysis of their own unem- ployment problem. They do not have available for their own or '■ Twelfth U. S. Census, Vol. 8, Census of Manufactures, pp. 276-281. ^ State Department of Labor and Industry, Bulletin on Variation in Employ- ment. [11 2 The Annals of the American Academy any one's else use data or information which show the extent and causes of lost time in their plants. Until such information is coMected, our knowledge of the causes and nature of unemploy- ment will remain in a very nebulous state. Very few of the labor unions keep any record showing even the amount, much less the effect, of unemployment; and only a small proportion of the records that are kept are thorough enough to be reliable. Moreover, the unions are apt, as a matter of policy, to exaggerate the amount of unemployment in good times. Conversely, in bad times, the fear that the strait of the workers, if known, may be used as a favorable opportunity to lower wages, leads labor unions to conceal the real facts. Finally, the figures, even if complete, would present information for but a small minority of the total body of Philadel- phia wage-earners. The value of individual firms and of unions as sources of in- formation is still further lessened by the hesitancy that many em- ployers and some labor unions have of giving information to the public. The unions fear that the employer will find out something about the organization which he may use to its injury. The employers, as a rule, fear that information which may be used to their injury, will reach business competitors, employes, or some regu- lating government agency. Most of the information for this report obtained from employers has been secured under the promise not to mention the name of the firm or the individual. The results of this "hush" policy make the study of unemployment very much like a case of "blind man's buff." Aside from these vague sources, Philadelphia's information about her own unemployment is confined to what appears in the newspapers or is passed around by word of mouth. Our igno- rance is abundantly evidenced whenever the amount of unem- ployment rises above the normal, by the wide variation shown in the "estimates" of the number of unemployed that appear from one source or another. For example, during the winter of 1914-15, the estimates of the number of unemployed in the city ranged from 50,000 to 250,000. No one knew the accurate guess from the inaccurate one; no one could tell the honest guess from the one that was deliberately faked. We were at sea between the exaggerations, on the one hand, of the calamity howler, and the exaggerations, on the other hand, of the conscious preacher of Steadying Employment 3 optimism. Small wonder that many sincere persons were at a loss to know to what extent the city was justified in resorting to ultra- heroic measures. Not until the end of the summer months — long after the time for decision was past — was the public as a whole put in possession of information that gave a more definite idea of*the extent of un- employment. In order to throw a little more light on the amount and sources of unemployment during the past winter, the Metro- politan Life Insurance Company was invited, by Mayor Blanken- burg, to conduct an unemployment canvass among the families of those who held policies in the company. The Metropolitan Com- pany placed the City of Philadelphia under obligations to itself by agreeing to aid, and lent its splendid organization for the purpose. The canvass was conducted during the week beginning March 15, 1915, by the agents of the company from each of the company's branch offices. In this study the agents of the company called on 78,058 families, in which were 137,244 wage-earners, — about 18 per cent of all the wage-earners in the city. Of the wage-earners canvassed, it was found that 10.3 per cent were entirely out of employment and that 19.7 per cent in addition were working part time. Canvasses conducted in other cities by the U. S. Department of Labor Statistics point to the conclusion that the Metropolitan figures are typical for the entire city. If that be so, there were in Philadelphia in the middle of March, 1915, approximately 79,000 unemployed and approximately 150,000 part-time wage-earners. It is significant that the state of affairs as revealed by the above figures was less severe than in most other large cities where similar canvasses were conducted. This canvass disclosed the fact that the textile industries and building trades furnished the largest number of unemployed; of whom over one fifth had been out of work over six months. In less than one fourth of 1 per cent of the cases was unemployment due to strikes or lock-outs. The Permanency of Unemployment The absence of dependable information about our own un- employment limits discussion, in most instances, to general state- ments. Datd; can be used chiefly for purposes of illustration Chart showir\g the'vanation \r\ the amount of money relief furnished during seventeen months by Ihe Philadelphia branch of Ihe society for Organizing Charity The un- shaded portion shows that part of the relief which was furnished because of impossibility of secur- ing employment on the part of those who were able to work - in the opinion of the Society s investigators Note the fairly con- stant sue of the relief furmshed for causes other than unenn — ployment and the great irregu- lar. tu of relief furnished un - emproyment - alrnost none ai all in the summer months MaylloMaijM Apr Uo Apr 50 MarlloMar31 Feb Ho Feb ?6 Jan.ltoJanJl ^ ^ ^ x^ -.^ ^Ty ^ ^ ^ >^ ^ ^ ^ ^ ^ ^ ^ (191!)) Decl5loDec31 (omitled) Movl5 IoOgc W Oct b to Nov 14 5epfl5.to0cti4 Augl5to5eptl4 JulylStoAugM JuneU-loJulijl5 Mayl5loJunel4 Aprlll5toMayl4 M3rl5.toApnH4 FeW5toMarI4 ^ ;^ \ ^ A ^ k ?^ Y ^ ^ P- A ^ ^ ^ Jan.l5torebI4 ggggg|g|§|ggg (1914) Figure 1 Steadying Employment 5 rather than as comprehensive summaries of an entire situation. However, this fact stands out: unemployment is permanent, if not steadily increasing. When we ordinarily assume that men and women who are willing and able to work are minus a job only in times of unusual and widespread industrial depression — such as we experienced during the last winter — we lose sight of the fact that there is always, even in the most prosperous times, a large amount of unemployment and part-time employment for these same workers. In the long run, this permanent or "chronic" un- employment totals larger than the unemployment of the severe industrial crises. This is true because the former exists continu- ously, year after year; whereas a crisis usually occurs only once in a period of five, eight or ten years. Moreover, from the city's stand- point, this chronic unemployment is of greater concern because it arises chiefly from local causes. The Society for Organizing Charity testifies that there is always in "good" years and "bad" alike, a considerable number of applicants for aid who, though willing and able to work, are forced to seek charitable assistance because of the impossibility of securing employment. Fig. 1 shows the total amount of re- lief granted by the Society for Organizing Charity each month during 1914 and to May, 1915; and, of this total, the percentage which was due to unemployment. In many cases, undoubtedly, other causes have contributed to throw these applicants onto charity after merely a brief period of unemployment; but this fact does not detract from the evidence shown by the chart of a considerable amount of unemployment always present. As a result of over one hundred interviews with the managers of business houses and social workers, and as a result of studies made in individual industrial plants, information has been col- lected which indicates the permanence of unemployment. This also indicates roughly those industries in the city in which unem- ployment is normally a large factor. A. The Textile Industry Of Philadelphia industries, the textile and clothing manu- factories show unemployment and part-time employment at their worst. In the textile industries, the fact which immediately strikes the observer is that, although very many more workers are unem- 6 The Annals of the American Academy ployed in industrially "bad" years, yet there is always, even in the most prosperous years, a very considerable percentage of the workers who are either entirely idle or working from one to five days a week. Mr. R. R. P. Bradford, whose sixteen years' ex- perience in charge of the "Lighthouse" (a social center for the better class of workers in Kensington) has given him an unusual oppor- tunity to become acquainted with the facts, says : We make the mistake of assuming that unemployment is a question solely of severe bad times. It is true that conditions are worse at such times — they even approach the destructiveness of a flood or an earthquake. But it is true that unemployment and part-time employment is a situation that is with us to a very considerable degree practically without cessation. If it is not one industry, it is another. If one miU escapes, another is hit. The fear of unemployment and part-time employment hangs, a permanent pall, over Kensington. It is worth while to point out two general conditions that especially contribute to permanent unemployment in the textile industries. First is the constant shift of demand from one type of textile fabric to another. The industries that have been built up to supply products no longer demanded by the market must gradually die out, or readjust themselves to a new demand. Dur- ing the decadence of these industries, the numbers of workers that have been attracted to the industry is greater than can now be kept busy. These employes hesitate to leave the industry for some other, probably uncertain and unaccustomed, line: conditions may improve in their own trade. Moreover, under existing cir- cumstances in industrial plants, they feel that the skill acquired by years of work in their own trade will be sacrificed, and many are too old to risk the change. An excess of workers is, therefore, characteristic of a declining industry, A long period of part time and of unemployment, often running into years, results. A second condition that contributes to irregularity in em- ployment, and is very much more important now than it was twenty years ago, is the growing tendency — especially in hosiery, higher grade carpets and fancy dress goods — to manufacture solely "on orders." Twenty years ago a manufacturer made carpet or hosiery or cloth and then went out and sold that carpet, or hosiery or cloth. Today the order comes in for a particular design, with a certain kind of yarn or silk and a certain number of threads to the inch, and the manufacturer makes that particular order. Formerly a manu- Steadying Employment 7 facturer produced standard makes of his particular line and simply piled up stock in his warehouse in the off-season. When the orders began to come in thick and fast, at the proper season, he was ready for them and simply used up his stock. Today manufacturers make, as a rule, very little to stock and run chiefly on orders. The result is that manufacturing has become nearly as irregular as the orders. When an order comes in, or especially when orders come in thick and fast at the proper season, there is a period of feverish activity until they are delivered, and then probably a long period of total or partial unemployment. A number of workers were in- terviewed in their homes in a block in which live the more indus- trious middle class workers in Kensington (hereinafter referred to as Block "K"). The experience of one man (a warper) in this block represents a situation prevailing in a large percentage of the textile factories. "The second week after I was employed at , I was called on to work overtime four nights till 9 o'clock at night. On Saturday of that week, I, with four others, was laid off for lack of work." The prevalence of unemployment is forcibly illustrated in the different branches of the textile industry in Philadelphia. 1. Lace and Lace Curtains. The last ten years has witnessed a steady increase in unemployment in the lace, and particularly in the lace curtain, business. There is no longer the demand for the lace curtains which fifteen j^ears ago adorned parlor and bedroom windows alike. Consequently the lace mills have rarely worked full time during the last six years. The gradual decline of output is illustrated by the figures of one of the large lace mills in Philadel- phia (see fig. 22y. It is claimed that some mills contain a large number of expensive machines that have never been used. Since both the employers and the lace weavers' union attempt to dis- tribute what work there is among as many workers as possible rather than assist a portion of the employes to new trades, permanent part-time employment results. A second feature of the lace in- dustry is its extreme irregularity. A new style in ladies' garments may make a sudden demand for a large amount of lace. The United States Government may send in once a year a large lumped order for mosquito netting for the Panama Canal Zone. With 3 Figure facing p. 60. 8 The Annals of the American Academy plenty of machines and plenty of men already working part time or out on the streets waiting for a call, and a premium placed on prompt delivery, the firm rushes the order out in a short time — and the next month pay envelopes flatten out. This condition of permanent unemployment among the lace workers is very generally testified to. The head of one of the largest lace mills in Philadelphia was asked whether, in his opinion, the lace and lace curtain workers had on the average worked three fifths of .their time in the last five years. He said doubtfully, "I think so." The doubt in his words and in his voice implied that they certainly could not have averaged much above that. A lace weaver interviewed in Block "K" asserted that he had been working five hours a day for the last five years. This statement was in- dependently confirmed by neighbors. The secretary of the National Lace Weavers' Association (one of the most intelligent and fair- minded labor men I have met) reports that, in his opinion, the average lace worker, in the last five years, has not made ten weeks altogether in which he worked full time. Statistics of dues kept by the local Lace Weavers' Union show the large amount of time that is lost by the lace weavers. The union has a graduated system for the payment of dues. Prior to January, 1914, a member who made over $15 in any one week paid 75c. a week dues to the union. Members who made from $7 to $15 a week paid 50c. dues. Those who earned less than $7 a week were excused for the week. In 1914, the wage limits which form the basis for the different classes of dues was changed. Since that time those earning over $18 a week paid 75c. dues; from $10 to $18, 50c. dues; under $10, no dues. To be excused in whole or part from payment of dues, a member must produce his pay slip each week. The dues paid for each and every week are recorded in the roll book. The records thus kept appear to be accurate and reliable. These records, therefore, show clearly what members received less than $7 (or $10), from $7 to $15 (or from $10 to $18) and over $15 (or over $18) per week. Both employers and em- ployes testify that "almost any kind of lace weaver can earn $20 a week if running full time, and they frequently make over $30 a week if running full." The vice-president of one of the largest lace mills in Philadelphia writes as follows regarding the full-time wages among lace weavers: Steadying Employment 9 If all the weavers on the Nottingham lace curtain machines were divided into three general classes, low grade, medium and high grade, both from the stand- point of the abihty of the weaver and the gauge of the machine on which they work, and bearing in mind that all Nottingham lace curtain machines run at the same speed whether fine or coarse, competently or incompetently managed, we believe the following would be a fair average earning: Low grade Nottingham lace curtain weaver $18.00 per week Medium grade Nottingham lace curtain weaver 21 .00 per week High grade Nottingham lace curtain weaver 24 . 00 per week When it comes to a lace weaver, we cannot give the earnings with the same exactness, as a lace weaver may be skilled in one class of lace work and grossly incompetent in another. Most lace weavers have learned their trade in a localitj' making almost entirely one class of goods, and under the new condition of an American industry that must be resourceful to make any class of goods as styles may change we are encountering great difficulties. Aside from this fact, the weavers here are paid under a modified English card wliich puts a high rate on the bobbin fining goods for which England is preeminent and a very mixed card rate on the independent beam goods made almost entirely in France. The best approximation that we can make we would report as follows: Low grade lace weavers $20 . 00 per week Medium grade lace weavers 25 . 00 per week High grade lace weavers $30 .00 to 35 . 00 per week We would like it understood, however, that this is only an approximation, as on plain bobbin fining nets, which require less skill than perhaps any other class of goods, they sometimes get a weekly earning of more than $35.00 per week. This is one of the contradictions of the card under which we pay. The union roll book statistics, therefore, indicate roughly the amount of part-time employment and unemployment in the lace business. These statistics were compiled from the union's roll book, covering between 300 and 400 members. These records show that from January 1, 1909, to January 1, 1914, 13 per cent of the cases of members reporting showed a weekly wage of less than S7; 30 per cent earned from S7 to $15 per week, and only 57 per cent earned over $15 per week. This result is shown graphically" in fig. 2. In other words, in only 57 per cent of the cases reported in all of the working weeks was anything approaching full time made in that period. In 43 per cent of the cases, three-quarter time or less had been worked; and in 13 per cent of the cases, the members must have worked not over one-third time. Since January, 1914, when 75c. dues were required only when the weaver earned $18 or over, only 30 per cent of the cases have paid the highest dues. In other words. c 1 i t c — l n D ^ .(ft l2 ! ^ (0 -1 U .£ ? a - V V cPO u k- o o > O o ■#" O O; O 4, J3 0) 0) ' a > 3 -c --'0 ^^8 5 5 - T5 en ;i J C C + 01 m C ^ I'? d) lO ^ js: 3 Ol (1) .£ -t- d) C 6.> ^ -t j: dl ^C -0. > t 3 "D -^- X! . w ~-^ d) • D (U i; r ^ ^ C n — ^ 0^ Tl 1^ cQ J) 4^ ^ L 1 > ra ■*- lO y.2 in f« 1/) . 0-4; .w t' D - % i ^ ^■0 V ^ Jl 73 (0 (H .0 -5 "0 - *0 0) 1) C r Q^ i^ in J) (1) Q} 0) ^ Ed ^ -to d j: ^ ^ 1^ ^ -1- ii- T5 ^;iV -^-^-^ C CI C +- •— /"""^ CP ,0 ^ (U^ fo s. u ID ?2 lO 3i# ^0 ^ o '^ -1— ^ IV o — «^ cJ rT>. _ £■'5 - - i~ J 1 '■": " - ~' '" ""''^ _!, "-^ 1 ,---^ ,\ .\ :_:_- - s .■-.'. 1,' - /-,'-,'. y ::; :. -^ -'i ^^ \ /. \ / " \ . -- " « 1913 ? « 1914 3. « 1915 Figure 10 industry, it is impossible to say that the figures of any one mill are typical for all the textile industries. It should be remembered, however, that the conditions in this mill are among the most favorable for steady employment. The business is not highly seasonal and the goods are not so subject to the influences of extreme style, that the firm is forced to manufacture solely on orders. On the contrary, the articles are sufficiently well standardized to enable 18 The Annals of the American Academy the firm to make for stock up to the limit of its financial capacity, which is high. The experience and general ability of the manage- ment of this concern is above the average. Figure 10 gives the figures showing the great irregularity in the payroll of a number of carpet firms from week to week for the last two years and one-half. Such constant irregularity as this in total payroll implies a considerable degree of irregularity in employment. The number of wage-earners in the carpet industry in Phila- delphia, and therefore the number affected' by this irregularity' in employment, is approximately 11,000. 3. The Cloth Industry. The cloth industry includes a wide variety of cloth products from cheap cotton and woolen print cloth through all kinds of worsted and woolen goods to women's and men's wear and fancy dress goods. The development of textile manufacturing in the South, with its advantages to the employer of cheap labor, has led the manufacture of cheap cotton cloth to be transferred to the South within the last 20 years. In the same period there has been a big falling off in the demand for cheap woolen cloth, which was once one of the big cloth items manufactured in Philadelphia. The high grade woolens and worsted are made chiefly in the big mills of New England. These considerations have led Philadelphians to become, to a considera- ble degree, manufacturers of "novelty" goods or fancy dress goods of various kinds. In a great part of this fancy dress goods business, production is exceedingly irregular because of the in- fluence of style. The goods are not standardized and they depend on sudden veerings of style to create a new and sudden demand. When an order comes, rush delivery is demanded. When the order is filled, workers are idle. Many kinds of machines are required to manufacture the different varieties of dress goods. In many mills hands are trained to work on one kind of machine only. When a rush order comes it usually involves but one kind of weaving machines. The result is that workers on one set of machines will be working under high pressure, perhaps overtime; while workers on other machines in the same room are on the streets from lack of work. Two weeks later conditions may be reversed. One small manufacturer of novelties reported that as a re- sult of the above conditions he had not worked more than 50 Steadying Employment 19 per cent of his machines at any one time in the last three years. Some idea of the irregularity in employment in such a plant may be obtained from fig. 11, which shows the variation in the number employed and the variation in average pay per weaver at each two-weekly pay da> since February 16, 1912. The figures of another large well-known concern, manufac- o 40 Chart showing the variation on a percentage basis each biweekly pay pci ioJ , of the total number of employees and the total payroll of tlie weaving department of one small cloth mill manufacturing women's fancy dress goods and novelties. Curves are drawn on a percentage basis so as to avoid disclosure of actual figures. Note the great irregularity of employment,-!argely occasioned by the influence of style. Number of employees —^^—^^^— Total payroll Figure 11 turing women's high-grade fancy dress goods, indicated also the extreme irregularity of employment in this industry. Fig. 12 shows the wide variation in the number of looms running each month from January, 1910, to June, 1915. It does not follow that the looms classed as "working" were running steadily during the months indicated. Figures for the period 1910-1915 show that, each month, on the average, 36 per cent of the looms did not 20 The Annals of the American Academy operate at all; 64 per cent were running, but not necessarily con- tinuously. This result is shown graphically in fig. 13. 4. Hosiery. Lost time is normally less typical of the hosiery industry than of the three branches of the textile indus- try mentioned above. Even in normal, as well as abnormal r :""":::::::::: :": — :":::"":":"": : ::::::::.[ t_ . . --t..... jz on ^ ::::::. .i: . ^ .. ._. - _ . tr -- - - - - — ---- - rr, \t ::_.:::: : _ -. ij" " :: — ::_:_. :_ _ _- t . _ _ _ ^ ------- J -- ;;;;;; :: . _ - - (/) " " ~ - __ O ; Chart showing the number of looms running each, month from January : O - 1910 to May 1915, in a large textile mill making women's high grade fancy -_ - dress goods. Note the great irregularity.-It does not foUow that, because a ; 20 ; loom is marked as "running" for a certain month that it has been running ; ; that mouth to full capacity. It merely means that, that loom was running ect p - some time during the month. This curve, therefore, may represent a considerable - understatement of the irregularity of employment and the amount of unem- : - ployment in this mill After the chart was constructed percentage figures ; ; were substituted at the left of the chart in place of the figures showing the ; - actual number of looms running. 1 1 M 1 1 1 h 1 1 i 1 1 M 1 1 1 1 1 1 1 1 1 1 1 M 1 1 1 > 1 M M 1 1 1 1 1 M 1 1 II 1 1 M 1 M 1 1 ' 1 1 n II 1 11 1 1 1 1 II 1 1 1 1 1 1 1 1 1 II 1 II II 1 II 1 ll 1 1 1 11 II 1 M 1 1 M 1 1 1 1 1 1 1 ll 1 1 ll 1 " 1^1910 —4^ 1911 ^ 1912 — ^< 1913 -4 1914— *J* 2 S Figure 12 times, however, the business is characterized by considerable irregularity. This fact is brought out on the chart in fig. 25,^ which shows the variations in total payrolls of seven of the leading hosiery firms in Philadelphia for the last two and a half years. In this industry a manufacturer may keep his girls busy on * Page 80. Steadying Employment 21 stock in dull times if he desires, but his finishing department is thrown out, because goods can be packed only on order under present conditions (in most cases), because the manufacturer puts up goods under the jobbers' trade-marks. Conditions would be improved if all manufacturers agreed to manufacture under one trade-mark — his own. This statement of conditions in the lace, carpet, cloth and hosiery manufactures touches but the high spots of chronic un- employment in the textile industry. In other branches of the industry — upholstery, for example — the conditions are just as characteristic. B. The Clothing Industry The clothing industry ranks with the textile industry in the seriousness of its unemployment situation. The men's and women's clothing manufacturers each employ approximately 15,000 persons in Philadelphia (mostly Hebrews), of whom the majority are women. The manufacture of women's clothing is the more irregular. Increase of unemployment here has been due to the same vagaries of style responsible for irregularity in the cloth business. Changes of styles have made it possible to manufacture only at certain seasons. The very rapid increase in the frequency of style-changes, that has characterized the last two years, has served to break up even the regularity of irregular seasons and substitute a business characterized by sudden spurts followed by unemployment — in an order so irregular that it is impossible to be predicted. The Women's Garment Manufacturers' Association reports that five years ago, if business conditions were normal, there would be two big seasons — a spring and a fall season. Of these two seasons, the fall season was much the larger. In both seasons, however, there was but one main standard style for each line of garments. In preparing for the fall season, samples were made up in April, and the salesmen went on the road with these samples in May. Work on the orders sent in by the salesmen was begun in the factories in late June or July. This season continued until Thanksgiving, with July and August as the busiest months. During December little was done in the factories, except to make up samples for the spring season. Salesmen went out "on the road" early in January. Orders began to come in at once; the i- rt) ~c — no '■ ^ — ■ ; C O ro — o o *- ■^ no -- 3 O a> E.c ±: 2- ■^ D^ rt) - ~ J^ 5 ^£ "T^ tJ 1— ,n) o ■: v^ +- c: ^ 2 o •73 «n ro C m I _c o c 01 cQ "^.UOUi 2>>»lj.\i^ 2\|| ^|p1 |««thern C«l>f«fni« Edison Con\f\*9 Steadying Employment 23 factories started and ran nearly to capacity until Easter. From Easter until June or July little was done except the manufacture of samples. It is estimated by the secretary of the Women's Gar- ment Manufacturers' Association that during this off season in the spring, as well as during the fall (from Thanksgiving to early January), the plants ran less than 20 per cent of capacity. The description of the seasonal variation of employment is confirmed by the union. Formerly many of the least skilled help were laid off altogether during the off seasons. The rest of the help spent their time in the factories, working when an occasional garment order came in or simply waiting. On September 10, 1914, an agreement was entered into by the Garment Manufacturers' Association and the union that provided that whatever work there is during the off season shall be divided equally among all the employes in the unionized branches of the industry. The outcome is that, during the off seasons, approximately the usual quota of employes is in the plant, but they spend four times as long waiting for a garment to appear as they do working on the garment after it is in their hands. Not many of the employes secure any other work in the off season. A few get employment in the department stores during the Christ- mas rush. During the last year or eighteen months, changes in fashion have become much more frequent. No longer has the rule "one style, one season" held. During the fall of 1914 there were four distinct changes. These were noticeable in the great variety of coats and suits worn by women. Styles followed on the heels of each other so fast that it was impossible for women to keep up.^ This situation means complete disorganization of whatever regularity there has been in an already irregular business. Buyers buy sparingly of each style in anticipation of a new one. The season is, therefore, very short. When a new style appears, there is another sudden batch of rush orders to be pushed out under high pressure — and then, stagnation. Two long seasons have been chopped up into a number of short seasons. It is now impossible for the wage-earner to know what pay he will receive, or for the employer to know what business is in sight for him. Neither can ^ It is asserted by those studying the unemployment situation in New York that it is impossible for the average employe in the women's clothing industry to work over 50 per cent of the time, because of the excessive irregularity. S 3 Steadying Employment 25 plan ahead. To attempt this and trust to hitting the next fashion is so unsafe as to be a gambling proposition. The statement of a ladies' dress goods manufacturer (in which business the situation is analogous) will describe the situation. "One year I took a chance and made up goods ahead of the style. I happened to hit it right and made $85,000. I would hate to say what happens other times when I miss it." It is claimed by the secretary of the Women's Garment Manufacturers' Association that the introduction of idle periods into what was formerly a steady working period has added three or four weeks a year to the period of unemployment. Both the union and the manufacturers' association report that an attempt was made during the last year to bring about an agreement among the manufacturers in Philadelphia, New York, Chicago and Cleveland, that they should decide on one style for a season and stand by it. This attempt to bring about stability in the business and to make employment more regular failed because of mutual suspicion among employers. Most em- ployers claim that frequency of style changes is due to the two or three large manufacturers in New York, who set the style and change it often so as to increase sales of their own goods. Others assert that it can be charged to the large department stores who knock down a style shortly after it has been created, and set up another so that buyers will be stimulated to purchase over again, in order to "keep up with the style." The answer of each de- partment store, of course, is that it is forced to follow the example of its competitors. While the seasons in different branches of the women's gar- ment industries do not coincide, all concerns lose a proportion- ately large percentage of the annual time. A manufacturer of ladies' shirt waists employing several hundred hands has the fol- lowing to say regarding the irregularity of employment in that industry and the influence that extreme styles have on regularity of employment : We run almost to capacity from January to June. From June to January we run at practically 50 per cent capacity. We are especially slack from June to October. Conditions used to be such that the irregularity always characteristic of our business was a constant thing which we could predict in advance. Ivnow- ing when it occurred, we could sit up nights and plan against it, and figure out some way to reduce irregularity in production and employment. We could furnish employment during our dull seasons bj^ manufacturing to stock. Shirt- Steadying Emptoyment 27 waists were fairly well standardized and there were no extreme styles. Orders would come in ten months before delivery was required, and the plant could manufacture fairly regularly since it could make up these orders whenever convenience demanded. Frequently we could make up stock in the off season till we would have 100,000 shirtwaists piled up which we would work off in the buying season. Frequently we would make from ten to twelve thousand waists without an order. We knew that the worst we would have to do would be to simply swap dollars. Nowadays, we rarely make over twenty-five garments without orders. Although it is widely considered that men's clothing is so standardized that there can be little irregularity of production due to the variety of cloth and style, it is nevertheless true that the style-irregularity is only somewhat less than in women's clothing. The off seasons are less than half as long as the off seasons in the women's clothing business. How irregular the men's clothing busi- ness is, may be seen from fig. 14, which shows the weekly variation in the amount paid out by one large and representative men's clothing concern to tailors both within and without the factory. This represents the approximate variation in employment furnished. One large manufacturer who makes a very high grade of clothing, a business which is subject to style changes, writes as follows: Women's fashions play a more important part in dictating men's styles than ever before and, as a consequence, we have had more rapid changes in style than the average manufacturer does keep up with. These changes are not confined to the design of the garment alone, but the fabrics also, so that what appUes to the clothing manufacturer might be said just as strongly of the fabric maker. C. Industries Manufacturing Electric and Steam Railway Equip- ment and Ships The third great industry that, in the long run, adds most to unemployment in the Philadelphia district is that group of in- dustries which supply equipment to railroads and steamboat com- panies. The railroads and steamboat companies are notorious^ irregular buyers. They buy in a lump. When conditions are favorable to them, they buy vigorously. When the reverse holds, these companies, especially the railroads, buy scarcely anything. Since there are in the neighborhood of 40,000 persons in these industries in and around Philadelphia, a severe curtailment of such purchases is suflficient to affect seriously, if not altogether TTTi rrTTT r T" X- ------' ' , , ' X" " ± ::::;:;: . -.:.:_. ±:: :;:-3: - - : _:::::;;£-- ". x lO 1 -^ n, ! ' 1 I" d I J j<"SJs:S« ::::::::::::::*;:;;::::: _ - d 5 & a § •- o-.S """ — ^-' : o f. ° «; 3 j= s l-UJ sjS"^ togiu S::. ::::._ _. ^ ■" j3 g „; § >. 3-, :::::::: H ij a .a « ^ ^ o IJJ JJ-* "Sia-S^Sa '- = " ": •E_«33s-^<" ", "_:: :_ -- (^ad^.« 1 s^ — ""* ^ O.B S'O^ ^ ■" --..,;-_ - - Ci — J .L-_^___±J44- :: + t _ C^^ - . - - - -- — ' - ~- — 1 ' \ ■ , , 1 1 1 1 -- .t—^ . |- -" yf I'-^g^ ^Wm :: -- 1— ( -- OS (t! +. 3^ j: "^ ~- O T3 e £ O u 1^ ^ ft) . — 5 ~ ^ "^ Cat iD rO i_ ^ ci) C^ ttl rfl c: — n c _ rt) £ ro t: i: T3 -o rtl. .^^t — ' — a39U3AON Ji3aoi)o 5l38U31dK - -iw^^ W)8VW \avnNvr Steadying Employment 31 and these conditions hold among the negroes and Poles and south- east-European dock workers of Philadelphia. In the absence of exact statistics, the statements of superintendents of labor of steamship companies and the heads of docking concerns throw the best light on unemployment among the dockmen. The head of one stevedore firm says, — "If every steamship company were emploj-ing today as many dock-hands and longshoremen as it employed on its busiest day last year, one-half of the dock labor would still be idle." Another says, — "I do not believe that the dock-hands average over two days a week." Although the wages per hour are relatively high,^ the time lost is so great that the average weekly wage is low. In view of this lack of statistics for Philadelphia dockmen, the statement of the situation in New York may be taken as probably fairly typical of Philadelphia. Both employers and employes in New York testified before the Federal Industrial Relations Commission that the men earn on an average of from ten to twelve dollars per week. This irregularity tends to produce shiftlessness and dissipation in the workers. F. Agricultural Labor Agriculture is one of the most notoriously irregular indus- tries in its demand for labor. This is particularly true on the farms that lie to the east and south of Philadelphia, in the sandy coastal plain portions of New Jersey, Delaware and Maryland. In these sections, the chief products raised are truck and vege- tables. The cultivation and harvesting is done by hand to a much larger extent than is the cultivation and harvesting of most farm crops. As a result. South Jersey and Delaware have a very high demand for labor during the summer and fall. The extra de- mand Philadelphia and Baltimore are called on to supply. Every summer, whole families (chiefly Italians) migrate to the fields of South Jersey and Delaware in late May or early June, as soon as, or even before strawberries are ripe. Many of these families migrate from one section to another as the different crops in dif- ferent sections ripen. Some remain till the end of the cranberry season late in October. These families then return to Philadel- phia. After a bad winter, this exodus to the truck and berry field ^ Thirty cents per hour, forty-five cents per hour for overtime up to mid- night, and sixty cents for overtime after midnight and Sunday. 32 The Annals of the American Academy helps to relieve Philadelphia's unemployment problem. _ Stated the other way, however, although many of those returning in the fall to Philadelphia find employment in clothing factories, construc- tion gangs, etc., it is apparent that these returning thousands are dumped on to the city's labor market "just when winter is ap- proaching and when the industries are least able to absorb them. The extent of the irregularity of employment on the truck farms may be seen from a curve showing the variation in employ- ment on truck farms in South Jersey during the year 1914. Letters of inquiry were sent to a large number of farmers selected at random in South Jersey. The curve in fig. 17, showing the monthly varia- tion in employment on a number of truck farms in South Jersey during 1914, was constructed from the answers received from these inquiries. Closely akin to the irregularity in the demand from South Jersey and Delaware for agricultural labor is the demand of the ■fruit and vegetable canneries for practically the identical kind of labor. The South Jersey, Delaware and Maryland section is one of the biggest centers in eastern United States for the can- ning of fruit and vegetables. The majority of these canneries, which employ thousands of hands at the height of the season, run from two to five months every year. A large part of their help is drawn from Philadelphia and Baltimore in the spring and return there in the fall. G. Department Stores Employment in department stores is characterized by a considerable amount of seasonal irregularity. The high season occurs from Thanksgiving till Christmas. After the Christmas rush the number of employes usually declines until the last of February or March. During April and May the number is slightly increased in order to handle the sales of goods for the summer season. Employment during the summer season falls off, the low points being reached during July and August. The situation in the department stores is very well summarized in a study made by the Philadelphia Consumers' League, and published as a bulletin of the State Department of Labor and Industry : Steadying Employment 33 Regularity of Employment The following chart, showing the variation from the normal in the number of employes in one large department store, at different seasons, shows a condition which is probably true of the four other large stores. The month of May, when this store considered its force about normal, has been taken as 100 per cent. Percentage Fluctuation by Months in the Working Force of One Store Percentage 145 140 135 130 125 120 115 110 105 Normal 100 Force 95 90 85 80 75 70 I Jan. Feb. Mar. Apr. May Jvme July Aug. Sept. Oct. Nov. Dec. The month of December shows a 42 per cent increase in the normal force and August a 27 per cent decrease. This indicates plainly the number of tem- porary and intermittent department store workers at the command of any large store for busy seasons. Many girls work in the stores from September imtil Christmas eve or imtil January first, when a falUng off of trade demands a cutting down of forces. Hundreds of employes are dismissed Christmas eve in every large store. A few of these workers will be reengaged December 27 or 28 and kept through the January sales. A toy department that has normally 12 women, had 350 just before Christmas. About three hundred are dismissed December 24 and the others are gradually dropped during the next month imtil reduction sales and stock inventory are over. In March or April again extra workers will be taken on for two or three months. Upon the examination of the records of 456 saleswomen in one store, for a period of 16 weeks from June to September, it was found that many saleswomen take some voluntary vacation beyond the paid w'eek. The better paid women are out from one to nine weeks. The group considered had all been in the employ of the house at least one year and they averaged 7^ days' absence beyond their paid vacations in this summer season alone. Of those who were earning $8 and above, the largest proportion, or 55 per cent, were out one week and more beyond 34 The Annals of the American Academy the paid week, as against only 40 per cent of those earning under $8. In one department store regular saleswomen and six-day contingent sellers are given only three days' work a week in slack seasons. Despite this great irregularity of employment that appears on the surface, department store unemployment is made less serious in that a number of those laid off at the Christmas season regularly return to other work, which they have temporarily left in a slack season. For example, many of the stores keep a list of addresses of people whom it regularly calls on during the rush seasons. The help needed in certain departments is drawn from the wholesale departments of the store to the toy, book, jewelry, etc., departments who need extra help. The second large source of help is by securing traveling men who usually are not very busy during December. The busy season of these persons comes while the stores are stocking up before the Christmas rush. A man who, for example, has been a traveling jeweh-y salesman, then becomes a jewelry salesman in the department store, etc. In the third place, department stores secure help at Christmas from the small tailoring shops, whose busy season just precedes that of the department stores. Moreover, many of those laid off at the end of a busy season are persons such as married women, school students, etc., who utihze this opportunity to earn some "pin" money. Although a considerable amoxmt of time may be lost by those laid off by the stores before they are needed at their old positions, department store unemployment is made less serious by this dove- tailing of trades which assures steadier employment. H. Labor Union Statements In order to throw as much light as possible on the amount of unemployment in Philadelphia industries, letters were sent by the Director of Public Works to each union affiliated with the Central Labor Union. One of the questions in the letter asked the amount of time lost by the average member. This query was designed to indicate the amount of normal unemployment there was in different trades. Unions were asked to answer this question only if they had records. The tabulated results of the limited number of answers received are as follows: Union No. Time annually lost by average number 1 About 8 months (only those tempo- rarily employed considered) 2 4 months 3 10-12 days 4 2 months 5 3 days a week 6 half time 7 7 months 8 3 months 9 none 10 2 months 11 about 2 months Steadying Employment 35 These answers represent but a small percentage of the labor unions in Philadelphia. As a rule, we may assume that those with the largest amount of unemployment were most ready to answer. Even allowing for this and for any mistakes in the estimates, the abundance of unemployment is apparent. /. Miscellaneous Industries The preceding is not intended as a complete statement of unemployment and irregularity of employment in Philadelphia industries. Only the largest of those in which unsteadiness of employment exists were selected. A long list of industries might be named, in which, for one reason or another, conditions are much the same. Surely enough has been said to prove the exist- ence in Philadelphia (and probably any other industrial center) of a serious unemployment situation — firmly rooted, growing, det- rimental to employer, worker and community, even in the best of industrial years. r "fj w ^ ^i; ^ 2^ 13 ftl c w > £ 3 c c9 Z C c u -c i t) w D fn ^ ^-t-r rO-*- n ^ w ^ ^ ^^"^ -^ ^ «-- 5 3 ^^ "^ u lO -^ ? > ■" Z ^.t?\i__^_^ M- O ft) i: - U^ +- 3/^ 3 m t) t9 (b) U t) > r^ c: 0) W D s Jl cr> n] gss£ —1 c in m to n 0^ ^_ cvj rt=# o z "r^ ^ " oC) \UJ •r vO z < 01=^ PART II THE COST OF UNEMPLOYMENT To THE Employe Little though we know of the facts of unemployment, we know even less of its social cost. We do not realize how deeply unemployment penetrates, and how seriously it threatens, our community welfare. Although unemployment affects every in- terest in the community, the burden falls most heavily on the working classes. When out of work the average member of the working class loses his chief means of support. It is, therefore, a matter of life and death to him. The most immediate and vital effect of unemployment on the worker is a very serious reduction of the wage scale. Enough has been said to show how greatly unemployment reduces the pay received. In the absence of any general information for Phila- delphia industries, an investigation made in New Jersey will best serve to indicate, in a general way, the extent to which the wage scale is depressed by unemployment. Figures collected by the New Jersey State Department of Labor from firms employing over 21,000 workers in the machine industry and from firms employing nearly 16,000 persons in the silk industry show that each of these industries worked during the normal industrial year of 1912 at approximately 70 per cent of total capacity. The actual average wage received during the year for the machine industry was $684; for the silk industry, $509. If full time had been made, it follows that an increase of over 40 per cent would have resulted. This would have meant an average annual wage for the machine in- dustry of $977; for the silk industry of $726. This result is shown graphically in fig. 18. It has been shown that in Axminster Carpet Mill "A", in the last four years, employes lost at least 27 per cent of the normal working time since that much of the time was spent outside of the mill. The actual average annual wage received by piece workers in this mill was $413 (based on statistics compiled for the entire force from April, 1911, to April, 1912, and from July, 1914, to [37] > " i - I* ■ iQ J JO > 111 «) (u J! -; a "c ■° I 3 +5 = ? " ^ - t :£ _- a _o .0, .n 5i4- t III II) -" :5 4- ^; E " 8 u c o m ? X i j^^S" o5 .?<^< r^' ■5^^ 1 > ^ !5^ 5! li e 5 "»» o P 5 -^ ^^!9 4& i^ j3#i ^-s^ lu e o 52 j^^ < < * 52 Steadying Employment 39 April, 1915). If this 27 per cent of time had not been lost, the average annual wage would have been $566. The average annual loss of wage per employe through unemployment was at least $153, and was probably much more, if time lost waiting in the mill, and time lost by those laid off, were included. Stated for individual departments, the actual average annual wage and the lost wage per employe would be as follows : Average annual wage lost Actual average through lost time annual wage spent outside of mill Winders $334 $124 Threaders 237 88 Setters 468 173 Weavers 452 168 Pickers 444 164 These results are shown graphically in fig. 19. In short, the worker loses the opportunity of earning 100 per cent of what his energies and abilities warrant. Permanent or chronic unemployment means a permanent loss of wage. In essence it means that the family of a man with a $1,000 or $1,200 earning ability cannot profit by or live according to the standard of such means, because the man is actually earning only from $500 to $1,000 a year. Not merely does unemployment seriously re- duce the income of the worker; it makes his income decidedly ir- regular. Regular income is interrupted by periods of total or partial stoppage of income. In times characterized by such unusual industrial depression as of the past winter, the loss of income is complete on the part of thousands. To a large degree, the worker is entirely ignorant when such misfortune will befall him. Such a situation almost forces the worker to lead a hand-to-mouth existence. He hesitates to plan ahead, because he never knows whether he will be able to carry through his plans or not, for fear of an interruption of income. A premium is, therefore, placed on the lack of thrift. When the normal income returns after a famine period, it not unnaturally leads a family to spend extravagantly after the strain of pinching through a hard time, just as human nature always has, from the days we were savages, led us to indulge in an orgy of feasting after a long fasting. Unemployment and irregular employment are the arch enemies of thrift. 40 The Annals of the American Academy Perhaps the most serious industrial result of unemployment is its effect on the quality of the working people. It makes good workers bad. It turns workers who were capable and willing into men who are neither capable nor willing to hold a steady job if they could get one. As one man with whom I talked when he was out in front of a hosiery mill at the noon hour, said, " For six months before this month, we have been working from 8 to 3. When we came to go back to the old hours (7 to 5.30) it seemed at first as if we just couldn't make ourselves get up an hour earlier and work two hours later." The utter inability of the workers to understand or to change the situation breeds a fatalistic lack of hope that soon manifests itself in a lack of ambition and effort. The secretary of the National Lace Weavers' Union says, "The lace industry has made more bums than any industry I know of. I have seen men go into the mills only to work an hour this morning or an hour this afternoon, so long, that they are incapable of sustained effort. They lose their personal 'punch' and often eventually lose their ability to discuss anything except how things are this week in this or that plant." One of the usual ways by which such a depression leads to a debasing of the worker is by causing the skilled man to drift into an unskilled trade. When a man is out of work, he is very apt to "take anything" that offers, whether it is a job in which he can utilize his skill or not. The very common result is that he is never able to "come back" to his own trade. His ability in his partic- ular trade is sacrificed and he drifts into the already tremendously overcrowded class of unskilled men. Not only the worker but the entire Philadelphia community as well, is the loser by this lower- ing of the skill of labor. The injury to the worker by unemployment extends beyond his mere industrial efficiency, and dangerously affects the social standing, the family relations, the health, the intelligence and the public orderliness of the working classes of the community. A series of interviews with Kensington textile workers (chiefly Anglo- Saxons) is one steady story of used up savings, of increased debts, and of "half time" for four, six or nine months during the past winter. Even the few whose greater savings or "steadier time" would normally have led them to avoid the "pinch" of the past winter, have felt obliged to lend to the less fortunate to an extent Steadying Employment 41 which, in many cases, has meant a severe drain on their own re- sources. The lowered income during such a winter as the past (1914-15) very frequently means the curtailment of the necessities of food, fuel and clothing, to the point where the health is seriously im- paired. It is almost impossible to measure this injury. Mr. R. R. P. Bradford, who is in charge of the "Lighthouse" and was quoted previously (page 6), said during the spring of 1915, "I should not be at all surprised if, as a result of the lowering of physi- cal vitality among the Kensington workers, because of insufficient nourishment and protection, there should come about an epidemic of disease that will cost us dear. Whether it does or does not happen, we have a permanent injury as a result of this year's un- employment in the lessened vitality of the people." Every severe depression is a great destroyer of family life. Almost every family with whom I conversed knew of two or three families that were forced to "break up" because of the unemploy- ment during the past winter. One of the usual results of unem- ployment is a considerable increase in the number of thefts, bur- glaries and suicides. The figures of Table I show how these crimes have increased in Philadelphia during the winter of 1914-15, when unemployment was serious. Note also the increase of sui- cides during the winter of 1907-08 — the year of the last severe depression. Table I — Effect of Unemployment on Suicides and Chime Number of crimes committed during three winter months of 1906-7 1907-8 1908-9 1909-10 1910-11 1911-12 1912-13 1913-14 1914-15 Suicides Larcenies .... Burglaries .... 43 60 50 61 61 48 62 65 1,068 32 74 1,227 44 While other causes may have contributed to this result, it seems obvious that severe unemployment must have been an im- portant factor in the large increase for the present winter and for the winter of 1907-08. The superintendent of truancy reports a much larger number 42 The Annals of the American Academy of students remaining away from school on account of the lack of fit clothes than in any recent winter. Only a teacher can appre- ciate the effect of irregular attendance on the progress of students in a class room. Typical individual cases convey more clearly the situation in Kensington during the past winter than statistics. A few of these are, therefore, given. Two English brothers, who have been in this country three and seven years respectively, are married and live in the same house. Both are cloth weavers and have worked at the same mill since their coming to America. The story of Kensington is summed up in the statement of the elder : During the last five years I have not worked full time more than half the time. At our mill we usually work five or six months steady, and then part time the rest of the year. In the entire seven years I have been here, eighteen months was the longest steady run we ever had. This winter business has been unusually bad. We have worked half time ever since Christmas (the date of the interview was in July). If we had had any children Hke the rest, we'd be up against it like the rest of them. Anybody with children is certainly poor. It isn't because we don't want children, but things are so that if you have two or three children, it takes all you are able to make in good times to supply the necessaries; then when bad times come, you are up against it. If next winter is like the last, a lot of the people we know will have to live on borrowed money, or go under. I have loaned $25 in the last nine months. My brother loaned $33 of which he has had $16 returned. You can't get credit here in a bad time like you can at home. Things are more irregular than they are at home. If we had any children to support, we would go back at once. The native intelligence and honesty of this family were evi- dently of high calibre. The fact that they have worked three and seven years respectively at one mill is evidence of their industry. Frank Ball, a day hand in the Axminster Carpet Mill "A", is described by his foreman as being steady and capable and indus- trious. Ball says: I have a wife and three children — 12, 9 and 6 years old. Prior to last fall, I had $300 saved up. I get $2 a day, but since June, 1914 (this interview was in June, 1915), I have averaged less than $8 per week. My rent costs me $13. My father, who lives with me, has been sick, and this, combined with bad times, has used up our savings till we are now $65 in debt. I owe a bill at the clothing store, and I still owe for one of the five tons of coal I bought last year at this time. Now it's time to buy some more. Steadying Employment 43 I don't know what. I'd done if I hadn't had a more economical wife than most men. She makes over her old clothes so that they look like new, and when she can no longer fix them for herself, she makes them into clothes for the children. They look neat, too. My wife hasn't had a new dress since 1912. During this winter, I tried not to let a dollar get away from me if I could help it, and took odd jobs here and there whenever I could get it on the days there was no work at the mill. Once we were shut down for five days on account of the death of a member of the firm. I heard of a job at King of Prussia (a village 17 miles out in Chester County) and went out and got a job there on a farm. I painted some steps, and did other odd jobs about the place. Even at that we could hardly get along. A lot of families I know of broke up; one right across the street sold their furniture and separated to live with each other's folks. It will take a lot of people two or three years to get over this winter because a good many of them had to borrow money on their furniture. When the bills came due they were unable to make payments, and they lost their furniture. What famine and black plague were to the middle ag6s, so is unemployment to the modern industrial world. Cost of Unemployment to the Employer Unemployment involves a far-reaching economic loss to em- ployers, even though it does not so immediately affect their wel- fare as it does that of workers. However, it gravely endangers the welfare of any industrial community. It is a constant menace to an industrial center in its competition for trade with other centers. Corresponding to the reduced wages of the employe is the reduced output of employers. In the absence of any comprehen- sive statistics bearing on our loss of output through unemployment, the statistics gathered by the New Jersey State Department of Labor and Statistics show a situation which may be taken as fairly typical of Philadelphia. Figures collected by the State Depart- ment from 2,556 firms show the actual output for the year 1912. They also show the output for those plants if "all the existing facilities were brought into use." These latter figures are es- timated by the firms themselves. They show that for the normal industrial year of 1912, these plants were running only to 74 per cent of their capacity. Stated in terms of lost output it meant a loss of $363,000,000. Shown graphically the situation may be stated as in fig. 20. The complete loss to employers is not to be stated solely in c; =n ,.t5) .■— , fc .£ 1- .=^ , J ^ r ~o u- ^■^ £0 o J:: rr^ '. ^ ^ \~ ^ vD ^ ^ -r, V lO -c 'O ;:i -~ lO ^ mc\J :h f- 1 * <^ -^ -ft) if) 4- §: f jr J) c: rn o M H-. 3-1 C) - — 1^ ^D C^ ^-1 r^ W =5 O m v^-. u -^ (tj r-\ -^ rci r- t_J o < Steadying Employment 45 terms so simple and obvious as in lost output. Perhaps deserving of higher rank than the loss of output is the loss experienced by employers in demoralization of organization. In answer to a question sent by letter to the managers of six representative mills in Kensington, five answered that they regarded unemployment or slack time as the chief causes of the rapid shift of employes from shop to shop. As one employer puts it, "We found that, while our men could make $3 or S4 a day when they worked, they rarely did because of the time that was lost through slack orders, waiting for changes in the dyes, etc. As a result, they were dis- satisfied and we couldn't hold our best men." Another firm states the proposition conversely by saying, "We can keep our help and, incidentally, get the best help of our class, not because we pay a higher rate of wages — for as a matter of fact our rate is somewhat lower, — but because we guarantee our help steady employment and our twenty-five years' reputation bears out our claim." An electric company (outside of Philadelphia) has the fol- lowing to say regarding the demoralization of the working force through unemployment: It is realized by most manufacturers that not only is unrest and dissatis- faction produced among the working force by irregularities in production, but that there is a direct monetary loss of a considerable amount. This is especially true in industries which are conducted very largely by so-called unskilled labor which have to be taught how to perform the work on which they are employed as distinguished from work which is done by recognized trades. To illustrate, in a locomotive or general machine shop when work increases, more machinists are employed. These men, being trained artisans, are familiar with the work which they are employed to do and are immediately productive. In work similar to our own, vmless we are fortunate enough to recover all of oiu: old employes, which is never the case, a bulge in production requires the hiring of large numbers of unskilled men and women who have to be taught the various classes of work which are peculiar to our business. This training and development in the different departments requires all the way from a couple of weeks to six months. Where industries operate under this latter condition, the cost of securing new and untrained employes after a depression may amount to as much as from $25 to S40 per employe, this cost covering the cost of hiring, the cost of training, the work spoiled and the tools damaged during the process. It is aggravated by the fact that all the newcomers do not stick, so that to get one proficient employe in the end you have perhaps started with three, four or five and taken them part way through the training process. Further reference will be made later to this flow of labor through shops. It is sufficient to say here that this rapid shifting 46 The Annals of the American Academy of labor means a generally lower development of skill on the part of workers and, in the second place, the almost constant presence in the shop of an unusually large number of greenhorns. The loss of efficiency does not stop simply with the lost skill of those who leave. The manager of one of the largest toolmaking concerns around Philadelphia, says, "After a period of unemploy- ment, it takes the employer three weeks to get his force and plant up to the point where it can turn out orders with normal efficiency. During the slack times it has run down at the heels." The fore- man of Axminster Mill "A" says, "Even if the same weaver comes back to the same loom, after a long period of lost time, it takes three weeks before the loom will run again as well as it did before we shut down." More insidious than these losses to the employer is the loss during periods of unemployment through the degeneration of the workers in spirit, energy and ambition. As one employer writes: "Working men or working women who, through no fault of their own, are deprived successively time on time of the opportunities to realize their earning capacities, inevitably suffer impairment of courage, self-respect and even moral fibre, the loss of which falls first upon the community, but eventually upon industry, in the de- preciation in quality and spirit of the labor supply." Philadelphia has been known as the best labor market in the world. Unemploy- ment does not tend to keep her so. Finally, unemployment, if widespread, knocks the props out from under a market that may already be sagging, because it tends to diminish the buying power of the community, so that in- dustries which might normally be ready to start again, are dis- couraged from beginning. One progressive Philadelphia employer sums up the injury by unemployment in their forging and finishing shop as follows: When our factory begins to lose time and works on reduced hours, the first thing we notice is breaking up the personnel of our working force. Our best mechanics, who are capable men, begin looking around for other positions. As these men are in the minority, their loss is keenly felt, as quite often one man will be the backbone of a gang of three or four, and his loss is very severe both in eflficiency of production and in quality of work. High grade men have less trouble in obtaining other positions under normal conditions than the inferior grade of workmen, and unless a great deal of care is exercised during times of depression, a factory is liable to be left with their less efficient men on hand. Steadying Employment 47 With the loss of any of our men it seems that we must break in new men for the work. If we are running our regular output on a piece work system, as we do here, it simply means that the new men, not having the knowledge sufficient for efficiency, cannot he put on a piece work basis and it is necessary to start him on time work, raising the cost per unit from 5 to 10 per cent. New men, likewise, turn out more bad work than is usual, and this work is either an absolute loss or must be worked over again at an additional expense. This item, while not large, is simply an added burden to our cost. In our plant where material cuts such a figure we likewise find that replacing regular men with new men means that they waste material. The diflference between the waste of a bar used for a given product and the actual finished product is termed scrap in our cost keeping, and we have figures showing that these men produce 10 per cent more scrap than the average workmen should do. In other words, they use 10 per cent more material to produce a given piece of product than is necessary. More supplies are used up with new men than with old, first, because they do not know how to handle them, and waste them, and secondly, they produce more bad work which has to be refinished. The first lot of supplies used by new men in making the finished product is lost entirely. Regarding the last paragraph of your letter which asks for definite figures showing the difference in cost per unit when our factory is running at 100 per cent capacity and when it is running at 75 per cent capacity; on the latter figure our factory cost per unit is 20 to 22| per cent higher than at full capacity. The reason for this, of course, is that when you are cutting down the productive capacity it is very hard to reduce to a minimum your force of engineers, foremen, inspectors, firemen, truckers, and such incidental labor, and your general over- head expenses are to a great extent stationary. PART III THE INCREASE OF' KNOWLEDGE ABOUT UNEMPLOY- MENT What should we do about unemployment? It is obvious that we will not comprehend and cannot intelligently attack a problem that goes as deep into the industrial organization of society as does unemployment, so long as we know so little about it as we do now. The scantiness of our present knowledge of unemployment has already been pointed out. It does not enable us to attack unem- ployment much more successfully than did the ancient physicians attack physical illness in the days when medical science consisted only of a series of magical spells and potions. Our most funda- mental need at the present time in attacking unemployment is to know something about it — its facts, its causes — and its significance. It was with the object of contributing more definite infor- mation to our knowledge of Philadelphia's unemployment that the City of Philadelphia invited the Metropohtan Life Insurance Company to conduct an unemployment canvass among its policy- holders during the past winter. Unfortunately this information, while of invaluable aid in throwing light on the amount of unemployment in the past win- ter, is of little help in throwing light on the actual amount of un- employment that may exist at any time in the future. As a means of supplementing the Metropolitan canvass, arrangements have been made with the State Department of Labor and Industry that it should collect at regular quarterly in- tervals, statistics of unemployment and employment in Philadel- phia which will give a usable, even if inadequate, basis for esti- mating the amount of unemployment there is at any particular time in the future. The names of 250 manufacturing concerns, chosen so as to be as nearly typical of all sizes and kinds of manu- facturing industries as possible, were submitted by the Department of Public Works. The plan provides that the Department of Labor and Industry will collect monthly statements from these firms and compile the figures, showing for one particular week: 148] Steadying Employment 49 1. The number employed, Full time Part time At normal operating capacity 2. The number of hours worked per week 3. The total payroll (excluding salaries), Actual for week of When running to capacity These statistics should furnish a fair basis for estimating the variation in and amount of unemployment in the important manu- facturing industries of Philadelphia at the canvass periods. By properly "weighting" the statistics for each different industrj^ according to the importance of that industry in the city as indicated by census figures, it will be possible to form some idea of the extent of unemployment in Philadelphia manufactories, as a whole, at these canvass periods. In order not to disclose the business con- ditions of individual firms, the names of the firms from whom figures are collected are not given. Since Philadelphia is basicly and pre- eminently a manufacturing city, these figures will be sufficiently representative of the city as a whole to furnish a usable, though inadequate, clue to future conditions. As a result, we should not be in the future in such a quandary — whether unemploj'ment is serious enough to justify ultra-heroic measures — as we were in the past winter. These two sets of statistics will furnish but the barest out- Hne of the knowledge we need. Over and above general data, we need the closest and most detailed analysis of the causes, ex- tent and effects of unemployment in each important industry. It is only by such studies that we will be enabled to discuss un- employment intelHgently. Every organization interested in making Philadelphia a bet- ter city, industrially and socially, has an opportunity and a duty to forward the collection and discussion of the facts of unemploy- ment in this city. The causes and facts of unemployment differ so widely in different industries, and even in different phases of the same industry, that any investigations taken up should be con- centrated upon a study of a single industry. The Consumers' League has perhaps the best opportunity to throw light on condi- tions in certain Philadelphia industries by including a study of the amount, cause and results of unemployment in the industries which 50 The Annals of the American Academy it investigates. The Wharton School of the University of Penn- sylvania should take the lead, in the community's efforts to study the problem. A course in unemployment should be offered. Even- tually a department of unemployment would be established which shall give graduate and undergraduate courses in the subject; whose graduate students shall be assigned to investigate facts and results; and which shall assist in forwarding and coordinating the efforts of the various agencies that are studying the situation in Philadel- phia. The Pennsylvania Training School for Social Workers is another agency that we naturally expect to forward such discus- sion. Yet its roster of courses for the year 1914-15 contains no course on unemployment. Every school, every church, every club that is interested in social and industrial questions has a chance to encourage and push the discussion of a question so vital to the industrial and social well-being of the community. PART IV THE MANAGEMENT OF EMPLOYING CONCERNS IN ITS RELATION TO UNEMPLOYMENT Philadelphia emploj^ers cannot afford to disregard the in- jury received from unemployment. No community can, without grave concern, witness the degeneration of its working classes through unemployment, nor can it be oblivious to the terrific in- jury to its industrial interests through unemployment. The ob- ligation, therefore, rests upon the entire employing community to do everything that is humanly and financially possible to re- duce this evil. Philadelphia's methods of meeting her unemployment during the winter of 1914-15 cannot be regarded for a minute either as permanent or ideal. At best, charity is not a satisfactory solu- tion of unemployment. Our charitable methods during the past winter were particularly unfortunate. In this connection, we should freely recognize the very remarkable administrative effi- ciency and the spirit of public service and actual accomplishment which characterized the Emergency Aid Committee. It may even be granted that, in lieu of better measures, such steps may possibly be necessary, in unusually severe times, in order to pre- vent suffering. At such times we "face a fact, not a theory." But we must not consider charity as a satisfactory way to meet unemployment. Such a program tends to pauperize a community, invite shiftlessness and discourage self-reliance. As Jeff Davis, king of the hoboes and ma,nager of the Hotel De Gink in New York, puts it, "If you pay people to beg they will beg; if you pay 'em to work, they'll work." It furthermore tends to disgrace self-respect- ing workers and to injure their pride permanently. Emergency committees and public aid can be justified only in cases of severe extremity, under conditions analogous to those in a hospital, where a very dangerous and unusual operation is sometimes resorted to in order to save a dying patient's life. The necessity of resorting to charity to handle unemployment, instead of being a solution of the problem, is an admission that we have not solved it. It is a mortify- [51] I 1 II III 11 1 1 1 1 1 ll 1 |M 1 I I 1 I 1 ^::::::j::::::::::::::::" ,_Tf? a) ^:::::::::::i::::::::::::: g:^::: - (i> fe P privat es sho by the niber 24 to previo was the H'^^'SglSa-r, - . _ .; 1 1 1 1 1 iT fpublic id. 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Shortly after the first appropriation of $50,000 by Coun- cils, large numbers of foreigners appeared before the branch of- fices of the Society for Organizing Charity in South Philadelphia and demanded "some of the city money" as their inalienable right. Of 94 new applications that came in to the southeast district immediately after the donation of public aid was fea- tured in the newspapers, one of the heads of the Society for Or- ganizing Charity selected at random nine cases that would be roughly typical. Investigation showed that all but one of these cases were not only undeserving, but not even seriously needy. This clogging of the machinery of organized charity with un- deserving cases makes it difficult to reach and handle the really needy case at a time when help is most needed. Better evidence of the effect of the wide advertising is found in the sudden and large increase in the number of new applications received by the charitable societies immediately after the appropriation of city money, the formation of the Emergency Aid, Self-Sacrifice Week, etc., became public through the newspapers. The connection between the number applying for charitable aid and the exces- sive advertisement that is connected with the granting of pub- lic relief is seen in fig. 21, which shows the number of new appli- cations received each week during this winter, in connection with the dates on which the granting of relief was featured in the news- papers. Meeting unemployment with charity tends to produce the type of individual similar to a Philadelphian whom we may call "Jack." Jack had been out of work four months. A friend expressed his sympathy and received the reply, "Oh, it's not bad, it's like any other trade after you learn it." To what extent Philadelphia's advertised philanthropy dur- ing the past winter tended to bring into this city the floating va- grants of other cities, it is impossible to say. It is reasonable to 54 The Annals of the American Academy suppose that that result was brought about in Philadelphia during the winter of 1914-15. Unemployment is primarily a question of industry and in- dustrial organization. The manager of a shoe manufacturing company in Philadelphia asserts that unemployment cannot be reduced to any great extent under the present individualistic, competitive system of doing business. Waiving the question as to whether this fatalism is justified or not, it is obvious that the in- troduction of a new industrial system is a proposition so doctri- naire that it can scarcely be counted as offering any immediate practicable hope. It behooves us, therefore, to see what can be done under the present system. Since unemployment is an in- dustrial question, the responsibihty for ameliorating the evil must rest primarily upon the shoulders of those in control of modern industry, regardless of whether the unemployment be due to individual management of a business or to broader economic considerations. It is distinctly up to employers to attack the problem more seriously than they, as a whole, have hereto- fore; whether they do it from altruistic motives or because of the fact that, in the long run, it is the wisest business policy. It is up to them, even if it involves as fundamental changes as a certain large manufacturer implies when he says, "To secure uniform daily production, and to partially eliminate the evils of seasonal production, require practically an entire reorganization of the business with this as one of the primary objects. It is not a part of the organizing methods; it is a primary objective and must permeate every fibre of the whole institution." Philadelphia boasts that she is the "World's greatest Work- shop." In few ways can her employers more certainly insure that this phrase shall remain true than by eliminating unem- ployment. Philadelphia, free from unemployment, would attain a degree of prosperity at present undreamed of. If injury to our community, through unemployment, continues to be disregarded we may endanger our crown. What steps in dealing with unemployment are the more advanced, progressive and thoughtful employers taking which point the way for the majority to follow? Before answering this question it must be recognized that the widespread unemployment that results from such unusually Steadying Employment 55 severe industrial depressions as we experienced during the past winter and as are more or less frequently caused by money panics, or "psychological" panics, or European War, or fluctuations in the tariff, is a thing which can seldom be offset by the efforts of the employer, without the risk of endangering his industrial existence. Although he has an obligation, so far as it is industrially safe for him, to furnish employment at such times, the causes of such con- ditions are not of his making; and such depressions are frequently so severe that he has all he can do to keep his industrial ship afloat. In other words, unemployment is, in some respects, a thing so broad in its origin that effective action to prevent its causes must be nation or world-wide. To go back to the original question, "What can employers do?" Special study has been made of the textile industries; but many of the illustrations used are from other industries and the points mentioned are, to a greater or less degree, applicable to all industries. At the outset it must be accepted as a fundamental principle that each employing concern should regard itself as one industrial family for the welfare of whose members the concern is re- sponsible in the way in which the head of a private family is re- sponsible for its members. This fundamental principle must under- lie an employer's entire attitude towards his working force and guide all his efforts against unemployment. In the long run this will prove the only sound business policy. With this family relationship, the 100 per cent ideal, rarely possible of complete attainment, but toward which we should strive, is for each employer and each firm to accept responsibility for keep- ing a certain definite number of employes steadily employed — without overtime and with the minimum possible changes in per- sonnel. This number should be the "rating" which each firm gives itself as the number it can keep steadily employed. As one very progressive and successful employer writes: Many employers do not realize their duty to keep their working force intact under all conditions, with the exception of the very most unusual and aggravated cases of industrial depression. The keeping of the working force intact is not only a duty of the employer toward the employe and to the community, but it is on the face of it the only sound business policy. I believe not only that all public agencies should educate the employer toward the importance of this policy, but 56 The Annals of the American Academy that they should also educate the employer to the fact that vocational and periodi- cal depression must be looked for and should be provided against in prosperous times, at least to such an extent that a definite, sound and just policy is assured to the employe and to the community, if not more material help in some instances. 1. Obtaining and Analyzing the Facts in Each Individual Plant The first need of each individual employer, just as with the community as a whole, is the need for more information. Enough has been said to show that a large percentage possesses nothing but vague information about their own conditions. In order to know just what the amount of unemployment is in his firm and just what are the various causes, each employer should collect daily records which would show, by departments and tasks, for each day, week, quarter or year, the following : 1. Total number of employes in mill 2. Total number of absences 3. Causes of each absence 4. Actual payroll 5. Total payroll if all nominally on the payroll had been working full tune 6. Actual number of hours made in plant 7. Total number of hoiu-s made, if all on payroll had been working full time (deduct national holidays) 8. Number of new employes 9. Employes laid off: — a— Total number b — Good reasons (marriage, death, promotion, etc.) c — Where individual was responsible d — Where firm was responsible e — Where responsibility was uncertain This information would enable a firm to compile for any given period information to show: 1. The modulus of employment {i.e., the percentage of full time worked by employes). This would be ascertained by de- termining the rates between the actual total number of hours worked in the plant during the year and the number which would have been worked if all on the payroll had made full time (barring na- tional holidays), — as follows: Steadying Employment 57 actual total hours worked per day, week, month, etc. Modulus of employment = total hours worked if on continuous, full time operation during same period. 2. The causes of unemployment and the importance of each, thus indicating definite points for the firm to attack its own un- employment problem. 3. The labor turnover (i.e., the relation between the number of unnecessary hirings and the average number employed) . On a basis of information collected by these records, a firm may determine just what its own labor turnover is for any given period. Labor turnover in its relation to unemployment is dis- cussed on page 63. The daily report used by one firm to collect information of this character is shown below: Absentee, Tahdy and New Employe Report fok Thursday, May 20, 1915 Absentees Returned (7) Number Name Operation Reason Time 148 Barbara Zajicek . . Flps. and wits, stchd Sore throafand backache . . x 1 da. 300 Maud Cashin Foreman Father was sick x 1 da. 937 Helen Augustine . . Sle. swd. in Per. funeral x 1 da. 938 Mary HoefBer .... Sle. swd. in Per. funeral x I da. 969 Steve Dianiska . . . Shou. and slve. fin Per. naturalization papers . . x 1 da. 1163 Mike Jost Elevator man Sick x 2 da. One Day Absentees (5> S. M. R. Joe. Cavath Mach. inspector Per. went to court 1 da. 737 Theresa Gedeon . . Cts. tmd. bott. tckd 748 Julia Broch Col. cor. tckd. and feld Sick yesterday. 751 Agnes Anek M. H. col. tckd. and feld. . . . Tel. sick. 1382 Irene Steenstra . . . Lpl. and fronts exmd Sick yesterday. More Than One Day Absentees (2) 41 Charlotte Marquardt Route clerk Tel. sick x 2 da. 164 Adelia Fleger Top. pkts. made 2 da. New Hands (5) 843 Minnie Matuska 769 Alma Diffenback 1050 Mary Bugar Former 2375 Mary Tarnovsky . . Former 2385 Stella Beth Quitter (1) 1261 Mary Haluska. . . . Butt. swd. on Married. Tardy (0) 58 The Annals of the American Academy By means of this record this firm was able to say at the end of the year : Actual full time working year 48 weeks Actual amount of time employes could have worked in year 45.2 " Actual amount of time employes actually did work in year 42 " 2. Incomplete Methods of Determining Costs It is not surprising that with such vague knowledge of un- employment as generally prevails, mistakes should be made as to whether it is better business to run or stand idle in certain bad times. As a matter of fact employers very generally underesti- mate the loss of an idle plant and over-estimate the loss incurred by running during slack times. An expensive haste in shutting down plants in bad times results. The theory held by cost ac- countants that all the expenses of operating and maintaining a factory must be included in the cost of the output produced serves to increase unemployment by inducing firms to shut clown when good business policy demands that they should run at what is ap- parently a loss. In slack times, when demand has fallen off, the entire expense of maintenance and operation is saddled on to the small output, an apparent high cost of production per unit results. Accordingly the firm hastens to shut down to avoid "running at a loss" — and frequently does not even consider reducing prices — as its selling department may wish — in order to stimulate demand. Newer cost accounting methods are pointing out the fallacy of this system, insisting that the expense of supporting a part of the plant in idleness is a business expense and should be charged to the business and not into cost of the product. Under this plan, while the plant as a whole might be losing money, a particular department might be making a good profit over its own cost of production. By thus separating the cost of idleness and the actual cost of production, it appears that it will frequently be better busi- ness to run when the plant as a whole is seemingly running at a loss rather than to shut down and carry those as well as greater losses in idleness. One authority on this subject asserts he will shortly be able to prove that it will pay an employer to run a department at what prevailing cost accounting systems would conclude to be a 25 per cent loss. Steadying Employment 59 3. Maintaining an Excessive Labor Reserve Many firms retain more people on their payroll than they can keep busy. The inevitable result is that some of the em- ployes spend a good deal of their time on the streets or else, as is more often the case, the unemployment that results from this situation is "passed around" among the entire force and a great majority of the working force spend a very large percentage of their working time on "part-time." Taking this year in and year out, the accumulated amount of lost time or unemployment is tremendous. This situation is illustrated in the lace industry. The prev- alence of unemployment among the lace operators through good years and bad (see page 7) shows that there are more workers in the five lace firms in Philadelphia than the business can make use of. Fig. 22 shows the actual output in one firm for the lace department for each month of the last three years, as compared with the approximate output possible if the lace weavers had been running full time. Firms follow this practice of keeping an excessive number on their payrolls for a variety of reasons. The employer wishes to hold as large a labor reserve as he can so that, if a sudden order for rush delivery should come, he is in a position to put all hands on full time and turn the goods out in a hurry. Or there may be, for a short period of each year, a tendency to fall behind in deliveries; some employers keep enough help on part time, nearly all the year, just to supply their customers promptly at the period of maximum pressure. A second reason for holding an excessive force is in order to discourage efforts on the part of employes to secure higher wages or other favors which the firm may not desire to grant. When there is a lot of slack time in a plant, employes are less apt to cause trouble by asking for favors. On the other hand, when orders are crowding the firm, the employes have the advantage of a better bargaining position, and consequently use the favorable oppor- tunity to obtain what they want — witness the numerous strikes at munitions plants in the United States during the spring and summer of 1915. In order to obtain the whip-hand in the situation, especially in highly unionized industries, employers endeavor to obtain an 60 The AiirMls of the American Academy excess of men and machines so that part time may become the rule rather than the exception. One prominent Philadelphia hosiery manufacturer says, "Yes, I want to have enough help and machines so that my help will regularly get through the day at half past three or half past four or five o'clock. They don't ask for higher wages then as they do when they see orders piling up." This situation is apt to manifest itself by a firm having a number of plants in different localities, most of which do not ordinarily run at full capacity, or furnish full-time employment. When a strike at any one plant occurs, it costs the company little or nothing to divert the orders to its other plants. Since it can continue the strike indefinitely with no extra cost, it is sure to win. A third cause which leads to this situation is a decline in an industry or the failure of an industry to grow as fast as had been anticipated when the expansion of plant took place. In the over- expanded plant, the only advantage to be secured from the other- wise unproductive investment of capital is to keep force enough to man the entire plant— and distribute the work among them all. The excess labor reserve insures prompt deliveries and tends to discourage labor agitation. Under these conditions, labor unions frequently insist upon the firms distributing the work among all those in the trade. Labor unions thus help to hold workers in decaying trades; and the worker himself feels that by leaving his present trade he may sacrifice his skill, endanger his family and perhaps miss an unexpected boom in the present work. In the fourth place, employers fail to train certain members of the working force to perform more than one single specialized task. This means that each department, each floor, each task must either carry or have available a sufficient number of workers to satisfy its maximum demand for employes. This practice is illustrated by the case of a large hosiery mill in Kensington. In the doorway of that plant ready to insert in the "Help Wanted" sign were the following list of occupations: Examiners Boarders Winders Knitters Girls Steadying Employment 61 Boys Pairers Toppers Loopers Folders Welters Menders In answer to a question whether workers were ever trained to do more than one task so that an excess of workers in one de- partment might do work in another department, the head of the firm answered "No." Perhaps this answer should not be taken literally, since in almost every hosiery concern employes are shifted from one task to another. However, it is true that there is too great a tendency to train workers for one and only one task in most manufacturing concerns. In front of a large clothing house in Philadelphia there is a bulletin board on which the concern is constantly making known its wants for workmen and workwomen. It recently read: Ticket girls Sewers Girls Edge basters Feller hands Canvas basters Pressers It is not known whether this firm trains a percentage of its employes to work interchangeably in different departments as occasion may require or not. However, this bulletin board list, taken in connection with the list that hung in the doorway of the hosiery firm, shows the specialized ability sought even in simple operations. It also serves to illustrate that unless an employe, who works at such a detailed task, is trained to do more than one thing, he or she must in a great many cases be subject to much irregular employment. If one department cannot call on employes in some other department to help it over a busy period, it must either carry normally an excess of workers, or frequently call in and lay off extra help as required. With each department thus carrying a separate margin, the labor reserve for the entire plant 62 The Annals of the American Academy mounts high. No matter whether it is the practice of the firm to lay these extra men off as soon as the need for them ceases, or whether they are all retained and the work rotated among the force, unemployment to a large degree must result. This reserve trouble is being, to a considerable extent, ob- viated by using as far as possible a common reserve for different departments. In the lower grades of work, this is done simply by seeing to it that before such labor is laid off, there is no work in any other department. In the higher grades of help, however, the problem is more complex. Some few firms systematically train all or even a small portion of their help to do (well) two or three tasks other than chosen specialties. All departments then have a common reserve, which can be shifted as occasion demands. Or, if a wide seasonal change in the nature of the work takes place, the majority of the members of the working force simply change to a new occupation. This accomplishes, at least, an avoidance of an excessive labor reserve for that plant and continuity of employ- ment for those on its payroll. The superintendent of a large printing plant (outside of Phila- delphia) who has followed out this idea in training women workers described their methods in a letter as follows: Many of our girls know how to operate three different machines and are expert at one or more of the manual operations, such as pasting, gathering, hand- folding, gold-laying, etc. That they have this knowledge is due to the fact that scientific management has First: Demonstrated the advantage both to the firm and employes of training workers to do more than one kind of work. Second: Made it possible to select employes who can learn to do the difTerent kinds of work efficiently. Third: Furnished facilities for training the people in the shortest time and with the least effort. Fourth: Furnished an incentive for the worker. This incentive may be either finan- cial or the opportunity for advancement or both. With these selected and trained workers, with a normal amount of work, our regular employes will have practically no lost time even during the slack season. Steadying Employment 63 and their pay should average from 20 per cent to 30 per cent more than under the old system. Workers properly taught soon become bonus earners. Having earned bonus on one kind of work they "get the habit" and when put to other work are not satisfied until thej' can earn bonus on the new job. The training of workers to do several kinds of work eflRciently, the central control of the work and good routing make it possible: 1. To do a certain amount of work with fewer employes 2. Reduce cost 3. Give workers a higher wage 4. Give workers more steady employment 5. What is perhaps most important of all, it stimulates and develops the workers There can be no question but that without scientific management we could not have trained the workers to do the different kinds of work and they would not have had as regular employment. A convenient mechani.sm which assists in this work is an expense charge symbol which we call "retainers." In case we have a high-priced employe and give him work of a somewhat lower grade than that which he is accustomed to perform, our cost-keeping system permits us to charge the excess up to "retainers," which latter is then spread as a general business expense over the whole product. We use the same accounting device for taking care of the superannuated employes who are no longer able to compete in the matter of output but the question of whose discharge cannot be considered. In some cases the responsibility for not reducing the labor reserve does not rest with the employers. Labor unions not in- frequently oppose the training of employes to do other tasks, under the impression that each trade, by defending itself from the entrance of outside workers, is bettering itself. While some immediate gain may accrue to the trade thus protecting itself, it is a practice that surely does not benefit labor as a whole; and it is doubtful whether, in the long run, it will benefit the trade involved, since conditions will frequently be reversed. 4. Reduction of the Labor Turnover By the term "labor turnover" is ordinarily meant the pro- portion between the total number of persons hired during a year and the average number employed during the year. For example, if a firm requires 500 persons to run its business, and, during the course of the year, has passed through its doors 500 more without enlarging the force, that firm is said to have a labor turnover of 100 per cent. This method of determining labor turnover is too crude to be 64 The Annals of the American Academy of much use. Figures of turnover so gathered have little or no significance. One year the amount of necessary hiring might be very high due to sickness, deaths, marriages, strikes or some other cause over which the employer has little or no control. The fol- lowing year, due to an absence of these causes, the apparent turn- over might be very low. The actual amount of unnecessary hiring and firing may nevertheless have remained constant. To make our labor turnover figures significant, we must separate the neces- sary hirings from the unnecessary hirings. We must separate the necessary hirings which grow out of an enlargement of the plant or which are necessary to replace unavoidable withdrawals due to sick- ness, promotion, death, etc., from the unnecessary hirings, which are in large part the result of poor management in the choosing, assign- ing, directing, etc., of employes. It is this unnecessary hiring which indicates industrial turmoil and it is this that our labor turnover figures should measure. To determine such a refined labor turnover there should be deducted from the total number hired during the year the number by which the force was permanently increased during the year. This increase should be determined by subtracting the average number on the payroll at the first four paydays at the beginning of. the preceding year from the average number on the payroll at the first four paydays of this year. This might be a minus quantity. Moreover, there should be deducted from the total number of hirings the number of excusable or necessary withdrawals. The propor- tion which this bears to the total number on the payroll represents the refined labor turnover. The total number on the payroll is found by securing the average number on the payroll at the various paydays. For example, we may suppose that a firm had an average number on its payroll of the year of 500. During the year 500 persons may have been hired. The permanent force may have been increased by 50 and there may have been necessary with- drawals amounting to 25 during the course of the year. To pro- vide for the permanent increase and replace those who withdrew for an entirely unavoidable cause, this firm, therefore, was justified in hiring 75 persons. Deducting these necessary hirings from the total number of hirings, we may assume that the total amount of Steadying Employment 65 unnecessary hirings amounted to 425. In other words, the firm had a refined turnover of 425/500, or 85 per cent. Even this "refined" process represents but the crudest sort of method of determining labor turnover. The investigation and study of labor turnover is only just beginning. The question that immediately comes up is : What is the con- nection between labor turnover and unemployment? Surely, if "A" is discharged and "B" is hired to take his place, the number employed or unemployed is not altered. However, high labor turn- over does affect unemployment in the following fundamental ways: In the first place, as one manager puts it in a letter: ''The answer is obvious, however, to anybody who has been engaged in employment work, that all these moves break down the self- reliance of the workers and decentralize the problem to such an extent that it makes it difficult to study. I know, in particular, of one man who was found, through circumstances over which he had no control, to change his job eight times during one year. At the end of that time he was estimated to have declined 50 per cent in efficiency from that cause alone." In other words, the rapid shift, or flow of labor from shop to shop, tends to increase unemploy- ment by taking men from the more efficient classes — in which workers are apt to be scarce — and placing them in the ranks of the less skilled and unskilled groups which are usually already over- crowded. In the second place, as long as there are frequent changes in personnel in many classes of labor, by just so much will there be less chance for the development of skill and a good personal rela- tionship between employer and employe. Without these abstract assets the average employer feels less financial and personal incen- tive to ''hold on" to employes by furnishing steady employment. In the third place, a generally high labor turnover creates an excessively high labor reserve in certain industries. With the kaleidoscopic movement of labor in and out of factories the actual requirements of an industry can be but vaguely known. The man who is "out" does not know what the demand for help in his particular line of work is. He feels that, anyway, the kaleidoscope will soon displace some one from a job and give it to him. This reasoning that " I will soon get a chance" brings an excess of workers r 1 cJ "ZT) ca !w ^ -r -^^ o M^ ^ x: s. rn ■ — "O r-) _^ rx. o 'it 1^ c tn -< _c .g £ c^» \~ o ° in > ro ^ vD ^ — U- — av s: — • vO C^ — <>J CJ c: o iH -n til CJ -t- iV 0) ■cno Cl Cl. ? - cJ cr ? o ^ tJ o O O «0 D' "rt o k) s cri £ to i i i i 4 i i ' ' i-fsSs5^5 f,% Sif" S r Steadying Employment 67 into many industries, and unemployment results. The best illus- tration of this is found in the dock situation (see page 29). Finally, in the fourth place, employers are just beginning to realize the costs to them through high labor turnover. If they fully appreciate the money loss that is sustained through excessive hiring and firing — through high labor turnover — and if they realized that irregular employment was one of the important causes of high labor turnover (see page 43), they would give more earnest atten- tion to the problem in their plants. As one employer, who has made a careful study of labor turn- over, puts it, "The real point of the matter (so far as unemploy- ment is concerned) is that if you have a trained worker, say at $18 a week, and it becomes evident that work is going to be slack for ten days or a couple of weeks, it is cheaper to retain the man, with his experience and knowledge of the company's way of doing busi- ness, than it is to engage a new man, without experience, at the end of that period. This argument can be pushed too far, but at present hardly any attention is being given to it at all." How great is the active labor turnover among Philadelphia firms? Few firms make any attempt to keep records on this sub- ject. In order to measure roughly the extent of this indifference, all of the firms on twelve squares of one of the leading streets in the textile district of Kensington were canvassed. Of eleven mills who were willing to discuss the point, all had no records of the size of the labor turnover — at best only a rough idea. To supplement further this conclusion, twenty-five confidential letters of inquiry were sent to representative textile firms. Of the seven answers re- ceived, only two possessed any records which showed the size of the labor turnover. In a textile firm employing labor of medium skill, a study was made of the labor turnover, and the speed of the movement of labor through the shop in the Axminster Carpet Mill "A." The foreman had kept a hst of the dates on which help entered and left his employ for the period of 1907-15. In this mill, as has been before pointed out, conditions were favorable for a low turnover, because style was not such an important element in the goods, and slack seasons could be used to pile up large quantities of stock. By compiling the foreman's records it was found that 75 per cent of the men and GO per cent of the women employes remained in the em- Ji U • Q) t) ^ in X c iQ Q) :> (D d) 1^ 0) A j: 15 in in iS n) (1) (1) Cl- in ? i Q) C ■5 U- (. V V 5 C (I j: -+- in i/) rt ■- « f^ 9- i 0) c "■ (1) Y Q) C I^ fsaseziJDUi 4uauEiu^Z)d snuiui q lenuue 10 >*ac[Uir *2AV lO p3?foiduj2 jiaqujnu 36ejaAV Steadying Employment 69 ploy of the firm less than one year. They also showed that 48 per cent of the men and 37 per cent of the women employes remained in the employ less than ten weeks. Yet the foreman asserted that "most of the employes do not do good work until they have been with us eight weeks." During the process of compiling these statistics he evidenced considerable interest. On seeing the final results, his comment was, "Who'd a' thought it?" These results are shown graphically and in greater detail in fig. 23. The above figures represent merely the speed with which labor flows in and out of the shop. Measured in terms of the annual number of hirings in excess of the permanent increases, the average of such hirings was found to be nine-tenths as great as the number of employes. This is shown graphically in fig. 24. Many concrete illustrations of the size of the turnover in many Philadelphia firms might be cited. In view of the absence of any comprehensive information for Philadelphia, a study made by Magnus Alexander, of the General Electric Company, throws gen- eral light on the size of the labor turnover. The result is probably fairly typical of Philadelphia. Mr. Alexander made a study of the size of the labor turnover among all classes of employes (except those belonging to the commercial and engineering organization and the general executive staff) in a large number of factories of all sizes in the United States and Europe. This study was made during the year 1912 — which may be considered a normal industrial year. The investigation showed that the labor turnover (including necessary and unnecessary hirings) of these firms was over 100 per cent. On January 1, 1912, 38,668 persons were employed in all of these concerns. On December 31, 1912, 46,796 persons were employed. The increase in the working forces during the year, therefore, totalled 8,128. Yet, the records show that during the same period 44,365 people were engaged, indicating that 36,237 people had dropped out of the employment during the year. In other words, about 5^ times as many people had to be engaged dur- ing the year as constituted the permanent increase of force at tHe end of that period. Making allowance for the increase to the force, and for removals by death, illness and other unavoidable cause, Mr. Alexander con- cludes that practically the engagement of 22,140 could readily be 70 The Annals of the American Academy defended. What should be said, however, of the fact that 22,225 were engaged above the necessary requirement? The wide scope of this study makes it reasonable to suppose that its results are, on the average, typical for the mechanical in- dustries in Philadelphia as well as for any other industrial center. Altogether aside from the degenerating effect of this state of affairs on the employe, it represents a big leak to employers. Dif- ferent Philadelphia employers estimate the cost of unnecessarily discharging an average wage-earner at from $30 to $100, but here also there is little real knowledge of cost. Mr. Alexander's figures may be taken as typical. Based on estimates by employers for different classes of labor, Mr. Alexander figures that the loss in- curred by these firms in unnecessarily hiring 22,225 persons during the year 1912, as approximately $775,000. How little this loss is appreciated among Philadelphia textile firms as a whole is shown in the statement above referring to the small percentage of firms who keep records. Granted the situation and its cost to employer and employe, what can be done about it? It is a well established fact that high labor turnover can be very largely and profitably reduced by greater care and efficiency in management. The experience of one Philadelphia concern, manufacturers of a standard product which is almost without seasons, is significant. This firm employs nearly 1,000 persons. In 1911, when it first began to consider seriously the problem of excessive hiring and discharging of help, its turnover (based on necessary and unnec- essary hirings) was 100 per cent. The next three years witnessed a steady reduction in the turnover, which, by 1914, was less than 20 per cent. Equally significant of the possibilities in the reduc- tion of labor turnover is the case of a textile firm well known for the consideration shown for the welfare of its employes. This firm has a turnover so low that there is a common saying to the effect that if a man is "on the streets" there's something wrong with the man.'' The experience of a third firm, a cloth firm outside of Phila- delphia, simply adds evidence that it is within the power of indi- vidual managers to reduce the labor turnover. This firm, by a ^Yet it is significant that when this firm, one of the best managed in Philadel- phia, recently increased its force by 300, over 2,200 persons had to be hired to se- cure the 300. Steadying Employment 71 scientific study of the problem, and as a result of earnest efforts to secure employment, reduced its turnover bj^ 80 per cent from June, 1910, to July, 1914. What are the methods used by these firms or approved .by the more progressive employing concerns by which this terrific cost can be reduced, after management once becomes aroused to the importance of the problem? It is apparent that if any impression is to be made on the ex- cessive labor turnover, a great deal more attention and study must be given the "man" problem as contrasted with the "material and machine" problems. The specific methods used by the above firms, and most widely approved by progressive concerns, to secure a lower labor turnover, are three: A. Better methods of hiring and firing. B. Better methods of training help. C. Reduction of fluctuations in employment. A. Better Methods of Hiring and Discharging Help The greater attention to the "man" problem must manifest itself, above all things, in much more attention to and study of scientific methods of hiring and discharging men. The first re- quirement is that the handling of the employment problem should not be left to the foremen of different departments, but should be transferred to some high grade functionalized employment official or department, according to the size of the plant. As the manager of the cloth firm previously referred to says: "For the employment function, every industrial organization should have some one person or department whose sole business is the study and handling of this problem. This is a function that cannot be administered by some head or underling in an operating department." Unfortunately, the prevailing practice among the textile firms in Philadelphia is to leave the hiring and firing to the foremen of different departments. The canvass on "X" street (page G7) showed that, of eight firms who discussed the matter, six left the hiring entirely to the foremen of different departments. In two, the hiring was done by one functionalized oflftcer for the entire plant. To supplement this canvass, a number of inquiries were 72 The Annals of the American Academy directed to the managers of twenty-five firms scattered at random throughout different Hues of the textile industry. Of eight answers, six indicated that the hiring and discharging of help was left to the entire charge of foremen. The result of this lack of centralized employment is an almost complete lack of touch between the responsible heads and in- telligence of the concern and the employment problem. A state- ment that is applicable to many concerns was made by one of the heads (in charge of records) of a hosiery concern. ''We would never know here in the office when a person is being taken on or laid off if their names were not sent down every two weeks to re- ceive pay." In many concerns no one but the foreman has any record even of the names of employes. In the office workers appear as number so-and-so, which, for all the firm knows, may and often does mean, some one this week and someone else next week. This lax method of hiring and firing by foremen means that the choosing of help is left in charge of a man who is already over- burdened with other duties, and who, though he may possess a certain amount of technical skill and aptness in the processes of a particular department, has not the background for the suc- cessful employing of men. As a result, it becomes a secondary matter; and misfit employes, who are apt to become discouraged and leave, result. An extreme case of the lack of care under the foreman system is told of a Philadelphia textile factory. This firm advertised for help on a certain day. On the day indicated a large crowd of the jobless had assembled. When the doors were thrown open a mad scramble ensued as each person tried to grab a machine. Whoever got a machine remained. No selection was made. Surely this struggle was not one guaranteed to eliminate the unfit — the inefficient — or accurately fit men to jobs. In another case, the foreman who was to choose new help threw a number of apples into the assembled crowd. Whoever caught the apples got the job. The foreman is ordinarily incapable of judicious firing. Too often he uses his power to fire as a means of discipline, or as one large employer puts it, — "to keep the fear of God in their hearts." Perhaps the ideal attitude toward the firing of help is suggested in the case of the large Philadelphia firm who orders a rigid inves- tigation whenever a person voluntarily leaves their employ, to Steadying Employment 73 ascertain why anyone should ever want to leave. The head of one of the largest employing concerns in Philadelphia very deftly suggests the evils of leaving the employment function in the hands of low grade men such as foremen often are, when he says, "Any mutt can fire a man." Furthermore, the unsupervised authority of the foreman contributes to high labor turnover in the every-day relationship with his employes. Not merely does he bring in misfit help — who will soon leave — and discharges needlessly, but also he unconsciously drives many away by his sheer arbitrariness. One of the largest employers in Philadelphia, who works under the "foreman" system, says, "I have time and again seen my foreman do things that were absolutely cruel; and yet I am powerless to prevent it." A large lace manufacturer told the Philadelphia Secretary of the National Lace Weavers' Union, "I have more strikes and labor disputes as a result of the foolish and arbitrary acts of some foreman than any other cause." Closer supervision of the relationship between fore- man and w^orker by a responsible executive should work toward the eradication of much needless withdrawals from the employ of the firm. The result of the control of hiring and firing by foremen and the superiority of control by a functionalized employment depart- ment is evident from the testimony of the following employers. One employer says : I know of cases of foremen who frankly acknowledged to their intimates that they make a practice of discharging so many people once in so often to keep alive a healthy appreciation of the dependence of employes upon them. I know of other foremen who have opinions which practically amount to superstitions, so baseless are they, as to the significance of certain unimportant details in an em- ploye's work or manner. I could go on with such statements almost indefinitely. The real gist of the whole proposition, however, is that the company which is not wilHng to take a definite stand on this proposition of centralized employment is bound to have a labor turnover far in excess of what it needs to be, with a large consequent expense to itself therefrom, and thereby to contribute to the unem- ployment problem of the city or town in which it is situated. I have never been quite clear in my mind as to why it is that the average foreman or department head feels his authority to have been impaired when the employment function is taken away from him. Such is the case, however, and it makes a very diflBcult factor in the problem. 74 The Annals of the American Academy One of the heads of a forging and finishing shop in Philadel- phia describes as follows the experience and efforts of their firm in dealing with their own employment problem : a. Belter control of hiring men. It is common practice for the foreman of each department to be given full authority to hire their help. As foremen generally are not of much higher type than the average workman, this practice is very unsatisfactory. Men are hired without thought as to their fitness for the work they are to do, but simply because they happen to be on the spot when a man is wanted. As the turnover of help in a factory is such an expensive proposition, it seems advisable to have both the hiring and discharging of men supervised by some ex- ecutive who can analyze the fitness and qualifications of an applicant. When foremen need help in a department they can apply to this executive, and from his records he would be able to furnish help as needed and of a type that would be more likely to give satisfaction. b. Better control of discharging men. No foreman should be permitted to discharge men, as quite often discharges are made as much on account of personal prejudice as on account of inefficiency. Again, discharge for inefficiency is a sign of weakness in the organization, as, if a man possesses the ability to do the work when he is hired it means that the foreman has not fulfilled his duty if the man is a failure, except in extreme cases. After paying good money to break a man in, it is the height of extravagance to replace him with a green man at an additional expense if it is possible to raise such a man to your standard. If foremen are allowed to hire and discharge indiscriminately, it often hap- pens that men are laid off in one department when they are badly needed in another, and that green men are hired where needed when such department could have had the pick of the ones laid off. It stands to reason that a man who has been in the factory in any capacity long enough to know his way around and get acquainted to some degree with the product is a much better prospect for any other department than a green man taken off the street. Discharges for inefficiency or indiscriminate laying off of help tends to in- crease the unemployment problem. 0. Analyzed factory conditions. We have found that workmen drift from one place to another if not thor- oughly satisfied and that the turnover of labor in the average factory is out of all proportion to the payroll. This turnover results in great expense to the manu- facturer, as the breaking in of new help on any work requiring skill wiU cost at least $50 to $75 per head. The turnover also results in a great increase in the floating idle population of a city. One of the duties of a functionalized employment department will be to col- Steadying Employment 75 lect data which will throw light on each company's own emplojrment problem. One employer says: To begin with, what is everybody's business is nobody's, in the employment game as well as anywhere else. Men are picked to run a department on the basis of technical skill or aptitude in the processes of that department, and the employ- ment of people is purely a secondary matter with them. As a result of this, in the first place, records are entirely lacking by which a company can study its own employment problem and learn from experience. If a centralized employ- ment department did nothing else than to compile and issue the statistics of employment, I believe that it would pay any company to maintain such a de- partment. When it is considered, however, that in any industry work is uneven in different departments and that the individual being fired from one department might be a valuable find in some other department which has a requisition in for additional help, the bearing of the question becomes even plainer.^ B. Better Methods oj Training Help A second method of reducing high labor turnover is by the adoption of more effective methods of training help. One of the frequent causes of workers quitting is the fact that they can't "get on to the work." While this is often due to innate incapacity, it more often arises out of the lack of any effective system in the plant for the instruction of new men. The supervision of the training in many cases will become one of the functions of the employment department in a large concern. In many of the textile firms of Philadelphia there is either no system of training at all, or else the training consists solely in the privilege, on the part of the new worker, of watching an older em- ploye for two or three weeks. Of the twelve firms interviewed on "X" street, seven had no training system, but depended solely on securing skilled workers ready made off the streets. In four, new workers were "trained" by being allowed to work with old hands for two or three weeks. Some idea of the thoroughness of such a system in one mill at least may be gathered from the fact that old hands were paid at the rate of $1 per month to "train" new hands. In one of the twelve firms, the foreman did the instructing. Under such a system, it is not surprising that employers should complain of a scarcity of skilled labor, even in the midst of one of the most severe periods of unemployment ever experienced in the textile industries. 'A detailed statement of the organization, duties and advantages of a func- tionalized employment department, will be found in the May volume of The Annals of the American Academy of Political and Social Science. 76 The Annals of the American Academy Of the duty of the employer in this respect, one employer, in discussing methods of training, says: A new employe, at the best, is undeveloped for the position which he is called upon to fill in any organization, and, as he has been employed in order steadily and permanently to fill a position necessary for the objects of the organ- ization, he needs and is entitled to especial attention in order that he can be de- veloped to fill that position fittingly. Given character and fitness for the organ- ization, the acquirement of skill in the performance of a given duty is generally a matter of proper training being provided by the administrative side of the organization. It must always be remembered that skilled and fit men are not born, but made, and it is an essential function of any industrial organization to train men and make them fit for specific position necessary to the objects of the organization. There is no broader admission on the part of a manager of his own inefficiency and his own lack of comprehension of his duties and problems than the oft heard complaint on his part of the lack of skilled men. Every improvement in training methods will aid in improv- ing the unemployment problem by transferring workers from that tremendously overcrowded class and placing them in the ranks of the higher skilled, in which there is at present frequently a scarcity. , C. Reducing the Fluctuations in Employment Obviously the third step in reducing labor turnover will be the need for a more serious study of means by which all forms of fluctuation in employment may be reduced. Recognizing that the rise in some form or other of function- alized employment departments is a growing thing, and a thing to be assisted; recognizing also that the problems that confront those in charge of employment work in different firms are so complex that every manager needs to profit all he can by the experience of every other engaged in similar work, a number of employers, at the invitation of the Director of Public Works, met and formed the Philadelphia Association for the Discussion of Employment Prob- lems. This is a purely voluntary association for purposes of study, involving, on the part of members, no joint support of each other in labor troubles or of any outside course of action. Its object is to pool experiences and discuss common principles govern- ing employment so that the wastes experienced by both employer and employe resulting from improper selection, direction and dis- charge of labor may be eliminated. Steadying Em'ployment 77 5. By a Closer Cooperation Between the Manufacturing AND Selling Ends of a Concern and the Standardization of Product It is frequently true that a lack of cooperation between the manufacturing and selling ends of a business breeds a working at cross-purposes, without the joint idea of assuring continuity of production and employment to the manufacturing end. The textile industries in Philadelphia suffer particularly in this respect. Among textile centers the country over, Philadel- phia is conspicuous by the extent to which small mills compose her textile business. A very large percentage of the heads of these mills have at some time in the past come up through the mills as weavers. By dint of energy and frugality these men have been enabled to secure a start and to permanently establish their busi- ness. Such a history does not imply a broad business experience. As a result, many manufacturers say, "We are not sellers, we are manufacturers. That's enough for one man." A lack of capital has also contributed to this attitude. As a result, many have con- fined themselves solely to the manufacturing end and given little attention to the selling end, which has been turned over bodily to sole selling agents usually in New York City. Under the arrangements made, the selling agent was fre- quently given a free-handed authority. This gave him power to disregard continuity of production for the employer; and he nat- urally bent his efforts to selling that which was easiest for himself. Moreover, frequently the manufacturer turned over to his agent the entire job of marketing his goods. The producer could sell through no other source. The seller on the other hand usually sold for a number of others who made the same or a very similar grade of goods. The seller came to represent the entire market to the manufacturer, while the manufacturer represented only a small part of the business to the seller. Out of the better bargaining- position of the selling agent, he obtained an amount of authority that manifested itself in a number of abuses seriously contributing to irregular employment. In discussing these abuses especial refer- ence is made to the hosier}^ industry (one of the largest branches of the textile industry in Philadelphia). Abuses: a. In the first place, the agent has nothing to force 78 The Annals oj the American Academy him to make serious effort to "back up" the employer. The selling end has expected the manufacturing end to be resourceful enough to cope with great irregularities in orders in good times and bad. When the whisper of hard times was first heard, the tendency was for the agent, who had small organization and little overhead, to "lay down" in his efforts just at the time when the good of the pro- ducing concern demanded that the greatest pressure be placed on the selling end. The manufacturer, not in touch with his market, was not able to go out and strive for more orders, even had he been will- ing and able to do so and had his contract with his agent permitted it. His only alternative was lower prices. On the other hand, one Philadelphia hosiery manufacturer who sells direct, spent $1,000 extra this past winter in pushing his sales so that his organization might be held together over the present winter. The jobber further reduces the demand for goods at critical times by a considerable reduction of the stock of goods carried as a reserve to supply the trade. Many large hosiery manufacturers in Philadelphia have given the sellers' lack of sufficient effort to secure regularity of orders, in good times and bad, as the chief reason for the firms cutting out the agent and doing their own mar- keting. b. In the second place, it is an easy matter, since the goods are not sold under a manufacturer's brand, for the selling agent to divert the orders that have been going to Manufacturer "A" to Manufacturer "B." Although the same number of orders may be coming through to the manufacturing trade as before, still, a long period of unemployment must result before readjustment will be made. On the other hand, where the hosiery is sold under the manufacturer's brand, the orders cannot be diverted, at will, to anyone. They belong to a particular manufacturer. That man- ufacturer has stablized his market and secured a grip on the only steady element on merchandizing — the consumer's demand. Every phase of his activity, including the employment of labor is, there- fore, subject to less uncertainty and fluctuation. By possessing a market for a standardized product, a manufacturer can more readily make to stock and thus run his mill steadily, even though orders are irregular. An example showing the degree of dominance that the selling . agent aims for under the "sole selling agent" system is the case of Steadying Employment 79 a Philadelphia firm. When this firm began to sell direct, the former agent felt so outraged that it publicly announced it would drive this firm out of business in two years. c. A third abuse is the evil of cancellation. As one textile man said, "The textile business is the most weak-kneed of any I know. In it, a contract is not a contract." Even though an order may be filed with a manufacturer, the goods bought, and even in many cases made up and shipped, in practice the buyer still has the right to "call off" the order. In some years, in certain lines, the percentage of cancellation runs over 50 per cent. A person closely in touch with the hosiery business "very roughly estimates" the average percentage of cancellations as eight. One Philadelphia concern had to close down when it received recall orders from its agent to 85 per cent of a season's orders. The significance of cancellation, in its relation to unemploy- ment, does not lie in the percentage of orders discontinued, but in the fact that the practice tends to disorganize production and keep employers afraid to "make up" orders until delivery time is near and every possible opportunity has been given for cancellation This creates busy periods just before a season's delivery and slack periods at other times. The hosiery manufacturer who sells direct can and does to a very much larger degree prevent this practice. d. In the fourth place, the manufacturer who "farms out" his selling does not have his ear to the ground. He is slow to re- adjust himself to changes in demand — a constant complaint from the selling agent. In a business characterized by frequent veerings in demand, as in the textile business, close touch with the market is particularly vital. As the great expansion of our own manufac- turing industries plus the introduction of foreign goods takes place, markets will be better supplied than formerly; the consumer will be given a greater choice in his purchases; and he will be less in- clined to buy whatever may be set before him whether it suits him or not. Because the consumer has become king it is essential that industry be so organized as to be in the closest possible touch with the changes in his demand. For example, the hosiery market in the last five years has come to demand less and less heavy cotton goods and more and more thin, imitation silk and silk goods. The man- ufacturers who are in touch with the market have been quicker to readjust themselves to this change than have those who sell through SE P S S c £ > ; ^ 1 ■■ in / / ',N. "~ > V <: s 1 •~~, s k. 1 \ ^ •^ ^> 1 1 -=- __ i\ >,^, 1 I ^ 1 Vi ^, . T - c \ "K / -^ > ' kf' 2 < ■^ f <■ ])> 1 I 1 ^ 7 CO 2 _^ > ' ' ^ 1 , — ■ ' -^ y A '■' ,' 1 \ ? °"S ™ < I \ ) li-? ? ) 1 > ,' f~. '^. ' / "^ §1 ^ '? ' — , > '>■ 1 ^ i' ' > \ ' - « S &5 ^ ^ \ >/' y ' > '< - ^_ ^Sl ^i 1^ c_ ' , .' 2-5^ e- 1" j; =» ; A t^ r N ^ yJ r -2 ™'c I'D S"° U J '0' S^S ""i ■g.t; ^^ < jV s^l. 12 1^ < ^-. [ \\ -^, A 1^ 2^ > \ '7 \ 1 '1! • ?r^ ^'z r= 1^ 1' •> '^ i < 1' >^ > ',' V 1 -is -£ 1^ ( > ; > t^% 'C& ge? ; '1 I [i l^t-B^ 1^2 (^ M >>'• < - - 1 .^ yf '^ 1^ ', 3 =^'~ J-5 ^ 'I S j b= ■ J > <■,' -■ ts^S^e oo° l^"*] \ ( '^ = T ; J '/ ^Ki— -5S-| "^S:;: A '' 1 ^'z 1 ' cS'H-I-ls .^ ,J. ) X \ 1 ,' 4 / : 1 1 ) 5J5 > '^ " S -^ "■ v: ^ -e^-Nc ! t ^~~^ •^z , ' fS^^s- S 1 ^ >\ V '<;' / K \ ', ^ 7\ ,' k ^ =T\^~^ V > i^ 's '» 3 ^ S-S.-^ z |S \ ^^ ; W- ^^ >i r , -^^^ ^ ' ^ ,' 1 >> / / K ( ■! 1 ; \ f \ '1 s \, ;/ \ , ,' ■^ / Y , '-, > V , ' 1 < Xi- 1 \/ \ \ ' /, \ •\ ~ 3> »- ^ - ', ' SI 1= g a o o 1^ Steadying Employment 81 agents. Unemployment results from any such miscalculation of the market. A final instance of the way in which a Philadelphia manu- facturer failed to make the selling end of his business properly articulate with the manufacturing end, may be mentioned in the case of a cloth manufacturer whose agent is primarily the agent of another concern making a totally different kind of goods. The seller "goes on the road" at the time of year suited to the needs of the larger client. This happens to be the the wrong time of year for the Philadelphia cloth manufacturer; so his sales are not large. It is a significant fact that among the most successful hosiery manufacturers are a number of men who were formerly salesmen in large distributing houses. They know almost nothing about the manufacturing end; they do know how to sell. In order to show the contrast, in production and employ- ment, between hosiery manufacturers who sell direct under their own brand and those who sell through agents under jobbers' brands, figures were collected from eight of the leading hosiery firms in Philadelphia. These figures give each firm's total payroll at each two-weekly paydays during 1913, 1914 and to May, 1915. The kind of hosiery manufactured by each firm is stated in the footnote. The payroll curves showing a greater irregularity in firms who sell through selling agents are given in figure 25. What one firm has been able to accomplish, in a seasonal business, through study and control of its selling end is suggested in a letter as follows: What we have accompUshed in the direction of leveling the curve of season- able work has been done chiefly through the selling end. Our business in jewelers' boxes used to be extremely difficult because prac- tically all of the output was made to order and work could seldom be started imtil May or June, and had to be completed well before Christmas. Our factory, therefore, used to be out of work from the middle of December up to the middle of May, and so seriously overcrowded from that time on that poor service was frequently given customers and our business considerably damaged. A few years ago we began to make earnest efforts to get box orders in earlier. After the first year or so of readjusting, we found our customers were more than willing to help in this work, so that today the majority of our orders reach us between the first of January and the first of June. This requires facilities for holding the goods until the date desired by the customer for shipping, and, of course, ties up capital, but we are able to keep experienced workers busy the j'ear through, are able to give almost perfect satisfaction in service to our customers, and through 82 The Annals of the American A cadennj the consequent savings and increased business the cost of carrying the goods has been covered several times over. One striking effect which went way beyond our expectations was the im- provement in quality of our output, which under the old system suffered more than we realized through the work of untrained hands and the crowding and strain of the fall season. Our line of Christmas specialties has been handled in the same manner, though an easier problem, because none of these goods are made to order. De- signs for Christmas, 1915, were chosen in July, 1914, then approved and laid out as to the way they should be put up, etc., so that the sample run could be ready by March, 1915. The goods are then sold for fall dehvery and the stock manu- factured during the first six months of the year. We have found it possible once or twice to add to our Une an item or two that could be made to fill in a gap in regular employment; for example, we introduced Christmas cards printed with steel die in order to keep our die-printing crew at work during a slack three months. Again, we have made good progress by substituting stock items for specials. For example, certain goods of a standard type, ordered periodically by our sales end, were manufactured special as the calls came in — sometimes in dull times, but more often during a rush period, by selecting certain lines and manufacturing a sufficient stock during the dull months the situation has been greatly reheved. The containers which are used for our merchandise were formerly made by us at different intervals, but under the new plan the entire quantity is manufactured during the first three months of the year. Many other moves of this sort tend toward further relief. Our problems are undoubtedly easier than those of some other industries; however, we feel from our experience that if the advantages of regularizing em- ployment become appreciated by the employer, some possible steps will suggest themselves, and these will in turn suggest further steps, so that considerable improvement, if not a big cure, can be effected. The following is a statement of a Philadelphia forging and finishing firm. This firm has so coordinated its selling and man- ufacturing departments that greater regularity in employment is secured. a. Continuity of Employment. By an analysis of factory conditions we have found it possible to minimize the loss of time on the part of our men due to chang- ing machines from one pattern to another by making orders to the factory of the maximum size and by endeavoring to make changes from one size to another in a distinctive pattern rather than a blind change from one pattern to another. By this method we have increased the efficiency of our plant to a marked degree in so far as production is concerned and have cut down materially the average "turn- over" of our labor. b. Complete Analysis of Sales Covering Patterns and Sizes by Months. By the installation of this system we find that some goods are so seasonable that the demand can be anticipated and goods made up in dull months in readiness for Steadying Employment 83 the market. The anticipation does away with non-employment to some degree, and keeps the manufacturer from being overwhehned with certain items at what is probably a very busy time on other lines. In other words, it levels the peak load and raises the curve of dullness. c. Dull Business. In times of depression that are so pronounced that none escape entirely, it is necessary to push the selling force with more than usual energy. It is our aim to get out new designs or patterns to create interest and to stimulate business with selling helps for the merchant, pointing out to the retailer that in time of depression it is necessary to approach the retailer problem from a different angle, and that by the use of such helps he can increase his trade. We further try to market new lines of goods in order to keep our working force employed. A shoe manufacturing concern (outside of Philadelphia) codifies the results of its ten years' experience in attempting to reduce seasonable unemployment (8 to 16 weeks) as follows: Unemployment: a. Resulting from: Seasonable demand for product where employes are laid off and work on short time for a considerable period. Note. In the majority of shoe factories, particularly in the large shoe centers, this causes shoe workers to be unemployed for periods ranging from eight to sixteen weeks per annum; in some cases more than this. Many of the employes are laid off entirely but more often are obliged to work on very short time and at greatly reduced wages. How Improved: a. By education of distributors to a realization that in the long run this lost time has to be paid for in the product and by getting their cooperation with this company by working on monthly estimates, put in at the beginning of the season. In busy periods customers who order above their previous estimates are cut down on deliveries in favor of customers whose estimates are not overrun. Customers are not held strictly to monthly estimates, but failure to follow them is regarded as a sales problem and is freely discussed. b. By the manufacture of special goods, made up without orders and sold through a special department created for that purpose. This department sells goods only when allotted to it, and sells them through special distributing chan- nels, giving special values and special terms. c. By distributing through both wholesale and large retail trade whose deUveries come at different periods. One automobile concern pushes to the limit the business of coordinating the selling end with the manufacturing end by ad- dressing its sales force in substance as follows: "We can make so many cars of each different grade this year. Now go out and sell that many." 84 The Annals of the American Academy From the foregoing illustrations, the importance of a stan- dardized product is evident, as well as the part which a correlated sales department can consciously play in making possible a market for this product. In lines such as clothing, standardization of even a part of the product is a herculean task. In other lines standardi- zation is relatively easy and can, therefore, be made to assist very materially in the steadying of production. The experience of one firm is a remarkable instance of how a little planning can result in standardizing production. This firm manufactures articles of printed matter used by everybody {e.g., envelopes). They de- scribe their work as follows: We have started here \Aath month work along this very line, which we are calling "Standardized Orders" selUng 10,000 to 20,000 articles of the same grade and style of printing, the same kind of paper, size, etc., running one order per month of these small orders totaling 1,000,000, etc., guaranteeing delivery of same at the end of the month. This gives us a large monthly stock order made up of a number of units, each unit calling for different electrotype and shipping instructions only. In this way our prices can be made more attractive, the mass of detail con- nected with Planning Department is largely reduced and it gives us an even distribution of work, largely reducing the old rush orders, rush periods, overtime or night work, etc., and keeps our force more steadily employed. The profits from a Standardizing Order are very attractive, although the selling price is considerably less. Not merely is this a good thing for the manufacturer and the employe, but also it is an even better thing for the buyer not to be running out of such a necessary commodity all the time. 6. Time Lost Waiting for Dye (or Other Materials) Most of the dyeing of textile fabrics in Philadelphia is done by separate firms, apart from the ones in which the dyed goods are made up into fabrics. Only a few firms maintain their own dye- plants. As a result it frequently happens in many firms that, when a fabric of complex pattern is to be woven, it will be fou d that a certain shade of goods has been forgotten. Or, before the garment is completely woven, yarn of a certain shade will run short. While more yarn is sent for, the loom stands idle. In some mills it is a rarity for weavers to make a full week, on account of having to wait for " dye." At times this wait extends to one or two weeks. The secretary of the Brussels Carpet Weavers' Association esti- mates that in some mills the loss of time runs as high as 16 per cent. Steadying Employment 85 That this lost time can be prevented is shown by many firms in parallel lines of the textile business, which may or may not oper- ate their own dye houses, where the time lost waiting for dye is practically nil. The problem of time lost waiting for dye is simply a part of the larger time of the daily and hourly interruptions in the plant, waiting for this or that reason. Though apparently small, this loss, in the long run, totals large. A shoe firm measured this lost time and succeeded in eliminating it to a large degree. See the following outline: Lost Time of Employes Through Daily and Hourly Interruptions Resulting from: a. Employes coming late; lost time inconsiderable. How Improved: 1. By "In Late Pass System," a proper investigation by foreman, and dis- cipline where needed. b. Employes going out or being laid off early, due to lack of work or stock. (Estimate lost time two to five weeks.) How Improved: 1. By organizing material purchasing and supply system, based on pre- determined sheet system, which gives purchasing departments ample time to purchase all material to exactly meet daily requirements, and to know absolutely when goods must be delivered in the various de- partments to meet the product in which this material will be needed. 2. By adopting a pre-determined standard daily production and by holding rigidly to it, foremen are enabled to compute accurately the number of employes needed on each job. 3. Pre-determination of employes needed on each operation is faciUtated by the fact that all work is piece work, based on standard average pro- duction of operation. c. Lost time due to fluctuation on special operations or in special depart- ments, due to variation in the class of product. (Estimate lost time one-half week.) (Note: — Estimate 10 per cent of employes lost five hours a week, fifty weeks a year, equal one-half week. How Improved: 1. By system of routing work into factories, not only uniformly in pairs each day, but also uniformly in pairs per day in certain types of prod- uct, such as patent leather shoes, bluchers, tan calf, button boots, etc. Where production on these items vary whole operations or departments 86 The Annals of the American Academy may work under badly fluctuating loads. By routing such types of work into the factory at a uniform rate per day for pre-determined periods these operations are given a steady production, as well as the operations through which the total production passes. There are many other ways similar to the above by which unemployment problems on special operations or departments can be wholly or partially solved. By keeping constantly in mind the necessity for steady employment it is usually possible to bring about good, or reasonably good conditions. To secure vacations for employes the entire business is shut down for the Fourth of July week, giving employes an opportunity to get rested just before the hot weather. June and November are our most difficult months. We formerly closed four days in June and four days in November for stock taking. This was discontinued several years ago. Except for this inventory period there have been only one or two seasons in ten years when factories have been closed, and then only for one to four day periods. Stopping this kind of unemployment is the business and duty of management. 7. Lack of Balance Between Departments It is true, in many cases, that one department in a continu- ous industry will be too large, so that it is capable of producing for the department it feeds faster than this latter can consume. As a result the department that is too large must lay off and wait for the other to catch up. This results either from an honestly un- successful effort to balance the different departments, or from an effort to insure that the departments with low-priced help and machinery shall be so large that they will never fail to keep the more costly departments busy. In Axminster Mill "A," the study showed that the "wind- ing" and "picking" departments, which "feed" or are fed by the "weaving" and "setting" departments, each lost 31 per cent of their working time during the four-year period from April, 1911, to April, 1915. Yet the weaving department lost only 23 per cent and the setting department lost only 19 per cent of the working time. These figures indicate that unemployment is being created in the winding and picking departments because they are too large for the others. 8. Stock Taking A large percentage of the textile firms lose from one to three weeks' time a year in taking stock. Many of the payroll curves Steadying Employment 87 of individual concerns in the textile industry indicate that shut- downs for one or two weeks a year are quite common in the textile industry. In fact, many firms lost from one to three weeks a year taking stock. Side by side with these firn)° in similar lines of the same industry, are those which avoid, by a variety of devices, the loss of any time at all through the taking of stock. It should be remembered that many concerns' lost time that is credited to stock taking is really due to lack of orders. 9. Limitation of the Amount an Employe is Allowed to Earn Each Week In many mills an employe is not permitted to earn more than so much a week. Either he must go home after earning that amount or else he must dawdle around the plant, pretending to work. In some cases, this rule is put in force by the employer with the hope that, by thus distributing the work over a larger number, a larger labor reserve is kept available for his particular plant. In other cases, it is a rule promulgated by labor unions who either want what work there is distributed over all in the trade, or who fear that if ability to produce a larger output is shown, the price rate will be cut down. The result in either case is the same. One of the largest employing concerns in Philadelphia places a limit on the amount that employes in certain departments may earn. Investigation showed that in a two-weekly payroll sheet of a large hosiery firm in Philadelphia, 31 of 69 piece workers in the pressing department earned within five cents of $36. Since these employes were not allowed to go home early, a good many trips to the water cooler must have been involved. 10. Frequent Changes in Standard Daily Production Policy OF Factories According to Volume of Orders in Sight One Philadelphia concern, employing many thousands of men, regulates the laying off of help by the total volume of business booked so many weeks ahead. Running a plant by such an arithmetical rule means that production will be as irregular as orders, and nec- essarily implies great irregularity in employment. Within a six weeks' period in 1908, this firm laid off" 60 per cent of its help. The methods of the shoe firm, mentioned above, in eliminating '88 The Annals oj the American Academy the two to four weeks of annual unemployment are described by this firm: Frequent changes in standard daily production policy of factories, according to volume of orders in sight. Note. Many factories have no standard daily production basis, but change frequently, taking on or laying off help as needed. Roughly estimated, this causes unemployment of from two to four weeks per annum, in many cases much more. How Improved: 1. By adopting and holding absolutely to a uniform standard daily produc- tion basis for each factory. Many of our factories have run for a period of several years, putting into the factory each day a production varying not over one per cent. 2. When orders do not in a monthly period or block equal the factory capa- city, by filling in with special stock goods in small quantities, to be distributed through the special department previously mentioned. 3. When goods needed to fill monthly dehvery blocks are necessary, by asking distributors to send in orders on staples to fill shortages. 11. Manufacture to Stock One of the most common methods, — so obvious as hardly to need mentioning, — adopted to assure steadiness of employment, is the practice of using the dull seasons to manufacture to stock, where the product is of a nature that does not lose value through being stored. When the main product cannot be stored, firms frequently use the slack period to make up a special product. 12. Miscellaneous Practices by Employers Which Lessen OR Increase the Burden of Unemployment a. Giving Notice of Lay-off. Where the periods at which help is laid off are fairly regular, and can, therefore, be predicted in advance, it is not too much to ask employers to give notice be- forehand of the date on which such lay-off shall take place. This plan is perhaps best adapted to department stores, where it is known long in advance that a certain percentage of hands will be laid off at certain periods. In most department stores, however, this practice is not followed; and extra help is hired under the agree- ment that it may be laid off without notice. 6. Dovetailing of Trades. Where there is a regular seasonal laying-off and taking on of help, there are possibilities of regular Steadying Employment 89 seasonal transfers between firms whose busy seasons and slack seasons dovetail. This "dovetailing of trades" is almost unknown. A printing firm (outside of Philadelphia) with a maximum demand for help in the summer months, writes, as follows, of a plan it has in mind for the regular exchange of help between itself and a neighboring department store: What we had in view was to have an evening school of instruction so that a selected group of girls from our firm could be trained for the work required from sales girls in a department store. There is a civic association in this town where they have evening classes. I believe they teach domestic science, millinery, sewing, etc., and I see no reason why it would not be perfectly practical for arrangements to be made so that a competent person from a department store could teach a class how to make out the sales sUp, to meet customers and the best methods of doing the required work. I hope some time that this will be tried out. Undoubtedly it would be much easier to bring this about if two plants were near to the homes of the workers. We are fourteen miles from the department store, and most of the women em- ployes live in this town and they do not like the work in the department store on account of both the carfares and the time required to make the trip. This practice would tend toward continuity of employment to employes and would insure the' retention of trained help by each concern. A few firms, when it is necessary to lay off help, assume responsibility for securing new positions for them. This represents an ideal attitude on the part of such business firms. A general adoption of this practice would do much to assist in the dovetail- ing of trades with its resulting advantages to both employers and employes. c. Loans to Employes. A Philadelphia firm that manufactures shirtwaists has, for ten years, loaned money without interest or collateral to its employes. Assurance is asked that the money is not to be spent viciously; other than that, the company does not meddle in the employes' use of the loans. It is a significant com- mentary that this firm has never lost a dollar during the entire ten years, through failure of employes to return what was borrowed — and the firm employ several hundred workers. d. Retaining all of the Employes' Time at Fractional Pro- ductivity. It is the practice in some textile mills for a man to op- erate two or more looms. In dull times the employe is allowed to run one loom only. Thus, although the employe is working only at half or at third capacity and wages, he is forced to spend all of 90 The Annals of the American Academy his time in the mill. If the weaver were allowed to run all of his looms when in the factory, he would make just as much, and at least have a holiday out of his unemployment in which he could rest, pick up odd job here and there, or seek steadier work. The firm undoubtedly follows this practide so as to "hold" on to its employes. It is a practice, however, which even the "benevolent" argument — "by this means we keep them out of saloons" — cannot justify. e. Enforcing Needless Expense on Employes During Periods of Unemployjuent. One of the largest of the employing concerns in and around Philadelphia has a factory located over ten miles from the homes of most of its workers. Although for a year the firm has been running to a very small percentage of its capacity, it has required all employes to report at least once a week to the office of the plant ten miles away regardless of whether there was any work to be done or not. Employes who did not so report were laid off the list of those nominally on the payroll. This rule required a weekly carfare expenditure of ten or fifteen cents each way. Thirty, or even twenty cents a week is a very severe drain on the resources of a man who has been working little or none for over a year. The company had offices near the homes of its workers where reporting could easily have been done, if necessary. The carfare expense might thus have been avoided. Imposing such a needless burden is evidence of a criminal lack of responsibility on the part of that in- dividual firm. /. Part-Time Employment. Permanent part time employ- ment has already been condemned (p. 59). As an emergency measure to distribute employment in conditions of unusual stress, it can often be of great service. The head of a Philadelphia concern employing several thousand men writes as follows : Employers can do much to reduce the amount of unemployment. Managers of active manufacturing business can and should make employment much more steady than has too frequently been the case, and can use perfectly legitimates means to reduce to a minimum fluctuations in the number of employes due to times of industrial depression. Employers owe a duty to their employes, to their stockholders and to society to keep their working forces intact, active and well content, and the strongest possible measures should be used to this end. One of the most important means to this end was freely practiced during a period of depression and hardship which occurred during the winter just closing, in that it was found possible to take the amount of work available in a very de- Steadying Employment 91 pressed period and spread it and the wages consequent upon this work over as many families as possible, thus distributing the money available for wages, even though in smaller quantities per unit, over a larger number of individuals, and keep them from absolute unemployment to a greater degree than would have oc- curred had the same amount of wages been spread over a smaller number of em- ployes working practically full time. It is fully recognized that this is not good manufacturing efficiency, but it was deemed a humanitarian measure to be executed in times which were very hard for both employer and employed. It is certain that the employes who experienced this form of cooperation appreciated what was being done, and all seemed willing to assist to the fullest degree. Naturally, there was no discussion of these meas- ures — they were simply tried and found to be useful and successful. Apropos of the same point, another employer writes; At times of industrial depression the working force should not be cut down except only under such extraordinary conditions as may be forced upon the in- dustry, which are absolutely beyond its control. When there is not enough work to keep the entire working force steadily employed, the number of hours of employment should be reduced equally throughout the whole organiza- tion. If all managers realized their duty in this respect, both to their organiza- tion and to the community, there would be very little, if any, aggravation of the problem of unemployment during periods of industrial depression. Where part time is necessary, many employers can, without difficulty, so arrange the working time that the burden of unem- ployment can be considerably lessened. For example, if the worker is allowed to work full time for several days, then take several days completely off, he is in a better position to make some use of his idle time than if he worked every day at fractional time. g. Times of payment. One concern interprets the rule that firms pay their help every two weeks as meaning ''every two weeks of completed service." In other words, this concern pays only after an employe has worked for twelve days even though that twelve days may be distributed over a six, eight or twelve weeks' period, as it is during slack periods. As a matter of fact, this firm is decidedly irregular, so that this is frequently the case. Earnest and dignified protests from conservative business associates have been repeatedly ignored. PART V THE DUTY OF THE GOVERNMENT Since the city cannot afford to permit its citizens to live sub- normal lives, it is the business of the government to leave no stone unturned in dealing with unemployment. It has already been pointed out that the appropriations of public money for relief pur- poses can be justified only in extreme distress. Municipal Work The feeling that the city government should, if possible, re- lieve unemployment, coupled with the idea that the city could expand its income at will has led many to assume that public work should be used to fill up the low points of employment in private work. It is argued that city work should be saved up until such times as it will tend to fill the gaps in employment. Unquestionably, it is the duty of the municipality, as well as other branches of govern- ment, to do this so far as possible. However, so far as the munic- ipality is concerned, the value of public work as a means of meeting unemployment has been very greatly exaggerated. Practically the only work which the city can, to any extent, pile up, is its contract work. But the amount of money annually spent by Philadelphia for city contracts is small. In 1914, the value of contract work done for the city was about $12,000,000. Of this, over .$2,000,000 was appropriated for services which must be per- formed regularly through the year — such as street cleaning, gar- bage, ash collection, etc. Of the remaining contracts, repre- senting only $10,000,000, one-half is spent to purchase supplies of various kinds — chiefly coal, lumber, and groceries. While, un- doubtedly, the hastening of purchases of public supplies would be of help in creating employment during periods of stress, and should be done as one of the best ways the city government can help, yet its influence will be but slight. Of the remaining $5,000,000, the majority consists of paving, resurfacing and similar work, which can not readily be done in winter when employment is most serious. Only a small part of the city work, such as the clearing up of the meadows in South Philadelphia for park use and building the [92] Steadying Employment 93 bulkheads along the Schuylkill, can be done in winter. If $1,000,000 worth of contract work could be saved annually to be done at emergency periods it could not, after materials had been bought, furnish employment to 15,000 persons for a month even at low rates. It would furnish little, if any, more employment than would be furnished during a year by a firm with 700 employes. It must furthermore be considered that a majority of the unemployed are persons whose sex, previous work, environment or physical in- capacity make them unable to do the heavy out-door construction work that the city would chiefly have to offer. Even without taking into account the difficulty of doing many kinds of city work in the middle of winter, the minor value of municipal work as a means of meeting serious unemployment, is apparent. Obviously, one employing concern, even though it be the city government, can do little to handle the unemployment problem of the 50,000 em- ploying concerns in Philadelphia. It is folly to comfortably delude ourselves into believing that a better distribution of municipal work affords a solution to our entire problem. Despite this fact, however, a fundamental obligation does rest upon the legislative and executive branches of the city gov- ernment to regard and make use of everything in municipal work which may affect unemployment. As much public work as is possible should be done at times when business is slack, but under the usual business conditions. Their fifty years' experience in deal- ing with unemployment has taught European countries that simon- pure relief emplo3^ment, i.e. — work especially made to furnish employment and conducted at low efficiency, and with little set standard of efficiency, is bad poUcy, save as a last resort. "Relief" work, as such, is more costly to the city than work done under normal conditions, despite the economy advantage frequently claimed because of lower wages and cheaper materials. The policy usually characteristic of relief work — that of paying a wage from one to ten times as great as that actually earned— is as degrading and degenerating in its effect on the jobless man as is the mere hand-out of funds. Relief work is still further to be objected to on the grounds that, by providing no standard of competence, it opens an easy way for a corrupt administration to justify endlessly its own excessive expenditure and avoid the proper safeguards of the civil service law. Finally, relief work, even if capable of sue- 94 The Annals of the American Academy cessful administration, is inadequate since it deals only with the resultant human suffering without touching the industrial disor- ganization responsible for it. Therefore, whatever contribution the municipality makes by supplying public work should be done under the normal or approxi- mately normal business methods. With these conditions imposed, a municipal policy, which will reserve public work not of a pressing nature until the time of emer- gency, and which will assure the rapid starting of such work when needed, should be adopted by each successive incoming administra- tion. In addition to this the municipality can assist by doing many things of a minor nature which will assist in solving the unemploy- ment question. Just as any individual employer has an obligation (not always possible to attain) to furnish steady employment the year round, so should the municipality adopt the policy of all-the-year-round work for strictly municipal employes. This policy has been adopted in Wellesley, Mass. The city should see to it that work and employment given out by such a tremendous construction operation as the building of the new subway system, should be doled out as regularly as possible. When that work draws to a close, it should taper down gradually so that an army of thousands of men should not be thrown on the city at once and the city's industries expected to absorb them in- stantly, as was the case in the building of the New York subway system. Finally, the municipality should have some place, perhaps a new municipal farm with quarry attached, where residents of Philadelphia, who are unable to find work, can be temporarily employed after the public employment bureau has granted a cer- tificate of character and worthiness. During the past winter, many men were found, in order to secure assistance from the city, to have had themselves committed to the House of Correction. Many of these were doubtless looking for a warm place without too much tiresome muscular acitvity. However, many were perfectly sincere in their desire for work. There is no reason why the city should not have a separate farm with a quarry attached which would help supply municipal needs. To this farm, citizens of Steadying Employment 95 Philadelphia, capable of doing hard out-door work, could be ad- mitted upon certificate of the public employment bureau, without stigma of disgrace, and work at a normal degree of efficiency and at a wage which would not encourage the permanency of such an oc- cupation. Some limit should be placed on the length of time a person might be allowed to remain at such a farm. A Municipal Employment Bureau One of the most obvious duties of the city government is the establishment of a municipal employment bureau. The primary function of such a bureau would be to assist in bringing men out of work into quick and easy communication with employers needing help. At present the responsibility for finding a new job rests almost entirely upon the man out of work. With little or no sys- tematized help for the worker, the well-known hope-killing, de- generating process of hunting a job results. Under existing con- ditions the need for such a bureau as a labor clearing house is very real. It should be recognized that the ideal and eventual solution is, not to have men change their jobs no matter how cheaply oy efficiently, but to have them remain steadily employed in their present jobs. The present chaotic condition of labor turnover in most factories has accentuated the present need and exaggerated the ultimate value of public employment bureaus. At present, the man out of work seeks a new position through one or more of five chief methods. 1. Inserting and answering newspaper ads. 2. Applying to the business agent of his union. 3. Applying at a private employment bureau or at the em- ployment bureau conducted by organizations of employers in certain trades. 4. By means of introductions by friends. 5. By tramping the streets, applying at random. The inadequacy of these methods for meeting the whole sit- uation is almost too obvious to point out. If the man out of work answers newspaper ads, he is apt to find that he has arrived too late, or that as a result of the vagueness of the newspaper descrip- tion, he has applied for a job for which he is not fitted. To insert an advertisement involves an expense that cannot well be stood by 96 The Annals of the American Academy the person unemployed and is frequently not justified by results. Members of unions which include in their membership a high per- centage of the trade, are in a much better position to be assisted to a new work if there is any. The fact is, however, that but a small percentage of the wage-earners belong to unions, and the majority are, therefore, not in a position to profit by the union activities. The man out of work can use a private employment bureau, but each of these covers only a small corner of its particular field, so that it may or may not know where there is a suitable job. Moreover, if he secures a position, the applicant must pay a fee ranging from $1 up. Even if no job is forthcoming, a fee of 50 cents is usually charged. Finally, the private employment bureaus make little analysis of positions with a view to fitting the men ac- curately so that satisfaction and permanence of employment shall be assured. Applying at random for work, or where "help wanted" signs announce the need for new help frequently means a hope-killing, all-day hunt for a job that does not exist or else it means walking all around a job without finding it. The business of finding jobs is so unsystematic that hunting work, in a large percentage of cases, is very much like a game of "Wind man's buff," with the hunt extending all over the city and even farther. The stories of one day's experiences told by an employe se- lected at random in an Axminster carpet mill, show how extrav- agant, discouraging and inefficient are the prevailing means of seeking work and how immeasurably superior it would be if all, or as much as possible of the work of job-hunting, could be central- ized in one free public employment bureau — which should be a great labor clearing house for the entire city. This man, who was young and unmarried and a day laborer, had been employed at the hat factory. In the middle of February he was laid off with 24 others because of a lack of work. He remained unemployed till Easter. He was told that he would be taken on at the hat factory when times were better. The new employer gave him a good recommendation as to ability and steadiness. He reports that he had enough "rainy day" money saved up so that it lasted during his period of unemployment. He described one day's travel in search for a job as follows: Steadying Employment 9? I got up at 5.30 and went to Baldwin's and was told no help was required. From there, I went to Hale & Kilburn at 18th and Lehigh Avenue and met with the same answer. I then walked to 2d and Erie Avenue to Potter's Oil Cloth Works, and they needed no help. Then to the Hess Bright Company, at Front and Erie Avenue, and again met with the same result. Next I came back home at 2d and Lehigh Avenue for a meal. In the afternoon, I went to Edward Brom- ley's; no help needed; from there to a firm at American and Girard Streets, with the same result. Then I called at the Barnett File Works, again with the same result. I tried two other places in the neighborhood, whose names I have forgotten, and none had any work. Often I would go out and after meeting with bad luck day after day, would say to myself at night, "the job has got to find me," but the next morning I would feel differently about it. In all this man walked approximately 186 squares in this one day. The path covered by this man this day is shown in fig 26. The function of a public employment bureau should not be interpreted, as it frequently is, as a cure for unemployment. It does not create jobs. Only in indirect roundabout ways does it tend to cure unemployment. It can, however, greatly improve the situation of the unemployed by effecting quickly and cheaply the transition from one job to another. When the business of se- curing work for idle workers shall have been concentrated in public employment bureaus to the degree which it is in Germany, the dis- piriting, aimless, inefficient hunt for a job by thousands of individ- ual unemployed workers should be a thing of the past. The bureau should bring about a "dovetailing" between in- dustries which require similar kinds of labor and in which the "off- season" of one corresponds with the ''on-season" of another, as in the case mentioned (on page 88) of the printing concern and a department store. Such a plan would assure the retention of skilled workers by the firm and contribute to continuity of employ- ment. In other ways, the bureau can cooperate with employers to reduce the irregularity of employment in certain industries. The extreme irregularity of employment among Philadelphia's 4,000 dock workers has already been indicated. The unemployment arising from the over-crowding of the dock working trade in Liver- pool has been largely reduced by an agreement entered into by the stevedores and shipping concerns and the public employment bm-eau. This agreement provides for common clearing houses along the docks from which firms employing such labor secure their ^Kowl^q course, walked by oi\£ untrrvploycd workar m or\(z. day b search for z job —166 sq^rct) ir\ all TKi^) c^oes or\ coasTarvtly or\lhe part of Kurxdrdds li\ timts of severs unem- ploymer\t r\ot one. day, but every day, sees Ihousands e;r\qzsged ir\ ^ search, like this , , , . Should not a public ernploymcnt bureau be established to assisi in preventing Kese inefficient hunts for a job'? ORDER OFTRIP ® - Aome © -Baldwin Locomo1"fve Works @- AaleSfKilburn @ -Pollers Linoleum Works (S) - Mess Bright Ball Bearinq Co ® -home To lunch. @ -Zdward Bromley. @ -Barnelt File Works Figure 26 Steadying Employment 99 help. When a call for workers comes, the officials of the clearing houses choose those who have Ijeen longest in the trade, all other things being equal. Thus an automatic limitation (as well as certain other artificial hmitations) is placed on the entrance of newcomers into the trade. This reduces the over-crowding and conseciuent unemployment among dock workers. Some similar plan would be of advantage to Philadelphia. The public employment bureau should work out the details of such a scheme and secure the cooperation of employers and the large share of government support necessary for such a plan. The Philadelphia employment bureau should be more than an employment bureau. It should be the official headquarters for the community's steady fight against unemployment. Its records and experience would constantly throw fight on the problem. This information should be published and freely distributed to every agency that is interested in the subject. The bureau should cooperate with educational institutions, giving advice, etc. The institutions in turn would help forward the investigation, and dissemination of facts about unemployment. A future department of the bureau should be especially con- cerned with the question of vocational guidance of young people. An efficient employment bureau would be so intimately conversant with the conditions of the labor market in each trade and with the qualities required of the worker for success in that trade that it should be able to offer and should maintain facilities for giving advice to young people about to enter industry and older persons who contemplate shifting from one trade to another. In conjunc- tion with the Vocational Training Department of the Board of Education, information regarding the opportunity or lack of op- portunity, as well as the requirements of particular trades, should be published in pamphlet form for the benefit of teachers, parents and others in a position to advise young persons about to enter industry. The need for work of this kind can be illustrated by the situation in the lace business. Here, despite the fact that the 300 or 400 lace weavers now in the business are a much larger number than the industry can keep anywhere near busy, there are approx- imately 100 boys and young men who, either as formal apprentices or in some other capacity, are now in line, hoping to enter the lace weavers' trade. 100 The Annals of the American Academy Since progress in reducing unemployment will necessarily be slow — as one man puts it — "will last us a thousand years"- — Philadelphia should look forward to the adoption, on either a state or city basis, of some form of insurance for wage-earners against unemployment — such as is in vogue in many of the coun- tries of Europe. In essence, this simply means that the government, the employer and the employe shall contribute so much per week to a common fund from which certain sums shall be paid out to those insured when unemployed. This insurance fund is usually administered by the public employment bureaus who offer work first, if it is available. The function of administering unemployment insurance will fall upon the local bureau. This insurance cannot, however, be practically adopted until after the labor market has been organized and the procuring of jobs sufficiently centralized in the bureau. This is necessary so that the bureau may be in a position to ascertain that there really is no work before unemploy- ment insurance shall be granted. A committee of the American Association of Labor Legisla- tion, working in conjunction with the State Department of Labor and Industry and the Department of Public Works, secured the passage in June, 1915, of laws providing for a state system of pub- lic employment bureaus. One of the functions of this system of public employment bureaus is the regulation of private employ- ment bureaus. By the terms of these acts, provision is made for the establishment and operation of a pubhc bureau in any city by the joint authority of the city and state. Plans are now on foot for the establishment of such a joint bureau in Philadelphia. As soon as Councils convene in the fall of 1915, an ordinance should be introduced authorizing the cooperation of the city authorities. In fact, the state has already started such a bureau. It is desired that the federal department of immigration, which now supports a public employment bureau in Philadelphia, can be induced to join in to help make one large bureau in Philadelphia, thus avoiding needless duplication of work. It is hoped that by thus joining the efforts of three govern- ment agencies in the support of one bureau, a common error and cause of failure in public employment bureaus shall be avoided — namely, insufficient funds to secure men of capability as superin- tendents, and to prosecute properly the duties of the bureau. Two Steadying Employment 101 other requirements for an ideal bureau, which are, however, fre- quently overlooked, are (1) a central location, on the first floor and with plenty of space, and (2) the choosing of employes under civil service rule. A Municipal Lodging House A suggestion commonly made is that the city should support a municipal lodging house. An additional permanent lodging house in Philadelphia is unnessary since the Philadelphia Branch of the Society for Organizing Charity (up to the summer of 1915) permanently supports one wayfarers' lodge, at which 175 homeless men can find shelter and food in return for a small amount of work. In addition to this, two missions offered floors where homeless men could " flop" during the past winter. Up to this spring, the Society for Organizing Charity maintained two lodges with a total capacity of 275. On only a few nights during the severe winter just past were these lodges filled to capacity. The existence of one (the smaller one has been closed) of these lodges leads to the conclu- sion that an additional permanent municipal lodging house would simply encourage and attract those of the unemployed who are neither willing nor able to work. However, prevalent practice and opinion in the larger cities of the country recommends that such lodges for homeless men should be taken over by the city, in toto, from the private charities. This would make possible better regula- tion and higher standards in such work. In times of unusual stress, whenever the facilities of the lodges of the Society for Organizing Charity should become entirely inadequate, the city should make provisions for the supplying of temporary accommodations, as a number of business men headed by H. T. Saunders did this past winter, and just as did New York City when its regular municipal lodging house became inadequate. Provision for administering these temporary quarters might be made with some existing charities, if the work of furnishing accommodations to homeless men is left to the societies. The Duty of the Consumer The entire responsibility for dealing with unemployment cannot be shouldered off on to employers and the city government. Consumers should realize that by following extreme styles in clothes, 102 The Annals of the American Academy household furnishings, etc., they are making steady production difficult to the manufacturer, and are, therefore, contributing to unemployment. They should also realize that when industry is slack, there rests upon the individuals the obligation to purchase as much and as widely as possible against future need, so that industry will be started up and employment again furnished. By "buying now," "hiring now," "repairing now," "building now," "cleaning up now," in slack times, both business firms, householders and individuals in general can contribute in the sanest way towards the relief of unem- ploj'ment. A campaign along this hne, similar to the Consumers' League "shop early" campaign, would be desirable. The Con- sumers' League is the logical agency to undertake such a campaign. Employers should realize that the effect of every expenditure either for labor or materials in one firm or industry tends to spread and stimulate other industries whose improved prosperity reacts on the original firm or industry. INDEX Agriculture, unemployment, 31-32. Charity, public and private, 52-53. Clothing industry, unemployment, 21- 27. Consumer, duty, 101-102. Consumers' League, work of, on un- employment, 49-50. Contract work, Philadelphia, 92. Cooperation, between manufacituring and selling departments, 77-84. Cost accounting, new methods, 58. Costs, determining, 58. Departments, lack of balance beween, 86. Dyes, time lost waiting for, 84-86. Efficiency, loss of, 46. Employers: cost of unemployment to, 43-47; duty, 55, 76; output, 43; records obtained by, 56. Employes: discharge, 74; earnings, 87; expenses, 90; hiring, 74; in railway equipment plant, 26, 29; loans, 89; lost time of, 85-86; municipal, 94; on truck farms in South Jersey, 30; payment, 91; reports, 57; training, 75-76; unemployment, 37-43. Employment: 56-57, 74, 98; central- ized, 72; continuity of, 82, 89, 97 fluctuations, 76; irregular, 19, 30, 32 61, 77-79, 97; part-time, 90-91 permanence, 96; regularity, 25-27 33-34, 82; seasonal variations, 23 steady, 17. bureau, municipal, 95. department, functionalized, 73- 75. Factory, conditions in, 74-75. Government, duty of, towards unem- ployment, 92-101. Hiring and firing, methods, 71-75. Income, irregular, 39. Labor: Philadelphia, 46; skilled, 40. reserve: excessive, 59-63; reasons for, 59-61. turnover: cause, 73; cost, 67; de- termining, 57, 64-65; meaning, 63; reduction, 63-77; size, 69-70; unem- ployment and, 65, 67. unions, unemployment and, 34- 35. Laying-off, notice, 88. Management, efficiency, 70. Manufacturing department, coopera- tion between selling and, 77-84. Metropolitan Life Insurance Company, canvass of, 3, 48. Municipal lodging houses, 101. New Jersey: output in, 44; unemploy- ment, 36. Orders, cancellation, 79. Payrolls, variations, 17, 80. Personnel, working force, 46. Philadelphia: contract work in, 92; crimes, 41; labor market, 46; unem- ployment, 1-36. Positions, securing new, 95. Production: continuity of, 77; cost, 58; disorganization, 79; irregularity, 12, 18; policy, 87-88; standardization, 84; steadying, 84. Public employment bureaus: functions, [103;] 104 Index 97, 100; need and value, 95; require- ments, 101. Sales, analysis of, 82-83. Scientific management, results, 62. Selling department: cooperation be- tween manufacturing and, 77-84; study and control of, 81-82. Standardization, of products, 77-84. Stock, manufacturing to, 88. taking, time lost in, 86-87. Textile industry, unemployment, 5-21. Trades, dovetailing of, 88-89. Unemployment: agricultural labor, 31- 32; building trades, 29; carpet in- dustry, 12-18; causes, 6-7, 57, 59; clothing industry, 18-27; Consumers' League on;49-50 ; cost, 37-47 ; courses in, 50; department stores, 32-34; ef- fects, 40-43, 45, 65, 67; elimination, 54, 88; extent, 2-3; government and, 92-101; hosiery industry, 20-21 ; im- provement, 83; labor unions, 34-35; lace curtain business, 7-13, 59; long- shoremen, 29, 31; municipal work in, 92-95; New Jersey, 36; permanency, 3-36; Philadelphia, 1-36; reduction, 100; remedies, 51, 55-56; seasonable, 83; statistics, 48-49; textile industry, 5-21. Vocational guidance, 99 Wage-earners, carpet industry, 18. scale, reduction, 37-39. Wages: carpet mills, 15; lace weavers, 8-12. Women workers, training, 62-63. Workers: industrial eflSciency, 40; training, 61-63. 000 086 974 Six Thousand Business Men and Public Officials are keeping informed on CURRENT SOCIAL, ECONOMIC AND POLITICAL PROBLEMS through membership in The American Academy of Political and Social Science MEMBERS OF THE ACADEMY Receive copies of dl the publications issoed by the Academy, indud- ing the six copies of The Annals. These are books on special subjects, of three himdred or more pages in length, caiefully indexed. These volumes, which appear bi-monthly, discuss prominent subjects of national or international importance and include a r&ume of the new books and documents on econoniic, social and political subjects. May send queries for bibhographies and other information on current economic, social and political problems. These queries are answered by specialists. 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