The economic structure of course affects the other institutions of society, setting the stage for many of the activities of mankind and modifying the potentialities of life in innumerable directions. Its influence is particularly powerful on that great group we call labor, on our consumption habits and on the conditions of rural life. It also affects various other groups and such institutions as the family, the church and the school, and has much to do with the way in which we spend our leisure time. And all of these social institutions and habits affect the economic organization as well. All, indeed, are interrelated, and often the economic changes come first and occur more rapidly than the correlated changes in other parts of the social structure.
Labor in Society
Wage earners may be viewed both as a factor in production and as a great group in modern society. In the former role their record of labor in production has shown steadily increasing efficiency as measured in output per worker, an increase of 50 per cent in the manufacturing industries since the beginning of the twentieth century. In part this has been due too the aid given by machines and in part to the organization of work more closely in accord with the principles of scientific management, supplemented by wiser consideration personal factors in working relations. Strikes have declined about 80 percent since the World War. In so far as increasing production may be due to the growth of technology the prospect is very bright; in so far as it is due to harmony in relationships between employer and employee, the past decade may have been exceptional and friction and strife may arise more frequently in future.
One of the problems of the future will be the condition of labor in industry and the past played by wage earners and their organizations in influencing these conditions. This problem at one time centered around the question of decent physical conditions of work and the attitudes of employers and workers. Such conditions have been better since the war, and the growth of scientific management should bring about further improvements, but this is a vast task and there will no doubt remain many grievances and complaints without satisfactory means of adjustment.
The problem of the conditions and role of labor has been associated at other times with the idea of industrial democracy, an extension into industry of the idea of political democracy with revolutionary possibilities. For a time, around the period of the World War, it appeared as if the movement might make a beginning here and there. In post-war years, however, the movement for better management has advanced and less is heard today of industrial democracy. Solutions may be sought along the lines of management and plant organization or along the lines of industrial democracy. Which set of solutions proves dominant is an issue which will profoundly affect the status of labor in modern society and as such is vital not only to the workers but to the community as a whole.
From the beginning of the century until the depression beginning in 1929 labor’s standard of life has been raised about 25 percent, as measured by the purchasing power of wages, although this increase prevailed through only a few of the thirty years. In the two years following 1929, the aggregate money earnings paid to American employees fell about 35 percent while the cost of living declined 15 percent.
Along with health and happiness, a high standard of living is a great desideratum of struggling mankind. Abundant natural resources, a slowly increasing or stationary population and an ever expanding technology all point over the years to a higher standard of living, if the various possible strains on the economic organization do not weaken it for too long periods. Such strains appear in business depression, in wars, in revolutions or very rapid transformations and in weaknesses in some particular part of the structure. For the very near future the standard of living may decline because of the menace to wages caused by unemployment, the possible slowness of economic recovery from the depression and the weakness of collective action on the part of wages earners. Certainly every effort should be made to prevent any lowering of the plane of living.
1929 Car and Fashion
No doubt the adequacy of wages for meeting minimum standards of living will long remain a matter of dispute. The problem of wage adequacy is affected by the appeals of new goods such as radios, automobiles, moving pictures, telephones and reading matter. The number of such items in the future will be greater, and sacrifices in food or in other ways which affect health will be made, unless all of us can be better educated as consumers. There is, however, one interpretation which should be considered. Death rates are still much higher in the lower income groups than in others. Until a point is reached where the death rate does not vary according to income, it seems paradoxical to claim that wage earners are receiving a living wage.
Poverty is by no means vanquished, although how widespread it may be is not now known for there have been no recent comprehensive studies of family income and expenditure. The indications are that even in our late period of unexampled prosperity there was much poverty in certain industries and localities, in rural area as well as in cities which was not of a temporary or accidental nature. The depression has greatly intensified it. After this crisis is over the first task will be to regain our former standards, inadequate as they were. The longer and the greater task, to achieve standards socially acceptable, will remain.
In addition to their effort to raise standards of living, wage earners have had a further objective in trying to shorten the hours of work, and since the beginning of the century hours have been shortened by about 15 percent. But such an advantage figure conceals a great variety of conditions. In several industries the hours worked were as high as 60 per week in 1930 and in others as low as 44. Pioneer and Puritan habits and philosophies regarding long hours of labor have given ground slowly before the oncoming machine, but long hours of toil promise to be less in the future and with this lessening of labor comes the problem of how best to utilize the hours thus saved.
While there has been gain to labor in higher earnings and shorter hours, there has been no such success against the terror of unemployment. Along with physical illness and mental disease unemployment ranks as a major cause of suffering. Fortunately it has been less extensive among married men than among the widowed, separated and divorced, and much less than among the single, if we may judge by a few sample studies. Fewer women than men have lost their job, and the old appear to have remained unemployed a much longer time than the young. According to an estimate commonly used there were 10,000,000 unemployed in the summer of 1932, although if there were a system of recording those out of work, the margin of error in this estimate might be found wide.
Insecurity of unemployment is characteristic of the economic process, and no doubt if control of rates of change were possible, unemployment could be greatly reduced. Free land no longer offers an outlet. Emergency relief is inadequate. The larger problem seems to be that of making the proper application of the principle of insurance, discussed elsewhere.
The membership of American trade unions declined from 5 million in 1920 to 3.3 million in 1931, the first time in American history that the unions did not gain in membership in a period of prosperity. Of great significance also is the fact that in the big industries such as coal, meat packing and steel, the unions have lost ground and have made no gains in others such as the manufacture of automobiles. When other functions than membership are considered it is clear that the organization of labor has not gone forward as have other parts of the economic system. Organizations of employers and of employees have changed at unequal rates of speed. Unless labor organizations show a more vigorous growth in the future other resources of society must be drawn upon to meet these problems.
Source: Recent Social Trends in the United States, an examination of the social state of the United States at the end of the 1920s undertaken at the direction of President Herbert Hoover.