The Factory

The dispute was settled by a demonstration. The superintendent was himself a graduate from the bench and had been an expert workman. The company's contract with the assemblers' union set $4.50 a day as the maximum wage. To prove his contention that even twelve cents was too great a price, he set the back pieces on ten ranges himself, under the eyes of a committee, and proved that at six cents a range he could easily earn the maximum day wage. The price agreed upon was eight cents, little more than half the original demand. Without the demonstration the men would have accepted twelve cents reluctantly.

In the course of the interviews with employers, it became evident that there was agreement on one point--to educate the worker to realize that the house's policy in handling its men gave added value to the sums paid out in wages.

The shiftless or unskilled man works mainly for the next pay envelope, with little or no regard for the continuity of employment, the possibility of promotion, of pension, of sick or accident benefits, of working conditions, or the like.

The skilled worker, on the contrary, and the more desirable class of laborers, nearly always rate their wages above or below par, according to the presence or the absence of these contingent benefits or emoluments.

To the average man with a family, the "steady job'' at fair wages is the first consideration. It appeals more strongly to him than intermittent employment at a much higher rate; while the younger, restless, and less dependable man, both skilled and unskilled, gravitates to the shop where he can command a premium for a little while. Just as managers are always looking for the steady worker, nearly all agree in assuring their employees that faithful and efficient service will be rewarded with continuous employment.

To carry out this policy is sometimes difficult in businesses where demand is seasonal and where a large part of the product must be made to order. Nevertheless, the manager who adjusts his production program to cover the entire year has the choice of the best workers even when other factories offer higher rates. Likewise, the employer who sacrifices his profit in bad years to ``take care of his men'' and hold his organization together recovers his losses when the revival comes.

So deeply rooted is this desire for a ``steady job'' and so generally recognized as an essential of the labor problem that several large industries have developed ``side lines'' to which they can turn their organization during their slack seasons; while others in periods of depression pile up huge stocks of standard products, making heavy investments of capital, for the primary purpose of keeping their men employed.

How such a policy reacts on the wage question, and hence on the efficiency of employees, is shown by an instance which lately fell under my notice. By a long and persistent campaign of education and demonstration, a small ``quality'' house forced a rival ten times as large to adopt the careful processes on which this quality depended. Adopting the small man's methods, the competitor, instead of training its own operatives to the new standards, sought to hire the other man's skilled workers. The premium offered was a thirty per cent advance. It was refused, however. The tempted mechanics, analyzing the rival's proposal, hit on the disloyalty contemplated towards its own employees. They were to be discharged or transferred to other departments to make room for the new men.

Measuring this cold-blooded policy against the consideration, the unfailing effort of their old employer to ``take care of them'' in bad seasons, the workers decided to stick to the smaller company and refuse the advance.

Next to continuous employment, among methods of increasing the value of wages, is the policy of making promotions from the ranks.

This practice seems to be commonly accepted as fruitful, although many firms believe it impossible of application in filling some of the higher as well as some of the more technical positions. Where the system is applicable, it acts as a powerful stimulus to the men by adding to their present wages the promise or possibility of better positions and higher pay in the future. It gives assurance of promotion for faithful service much greater than in houses which fill the upper positions from outside sources on the assumption that they thus get ``new blood'' into the business. The men secured from outside may be more skilled or more productive of immediate results than any available in the house organization. By their importation, however, the wages of all the men aspiring to the position have been cheapened. Nor does the evil stop there.

The assumption is naturally drawn that the same practice is likely to be followed in filling other vacancies. The stimulus to initiative and activity is thus weakened for men in every grade and their wages are shrunk below par.

The importance which some successful employers attach to this principle of promotion from the ranks is well illustrated by an incident which recently occurred in a large manufacturing establishment organized on a one-man basis. During the president's absence it was decided to open up a new zone of trade for a new product. No one in the organization knew the product and the field, so a new man was put in charge. The work progressed surprisingly well; the enterprise was in every way successful.

When the real head returned, he called his managers together and told them that the new man must be removed and the most deserving man in the regular organization appointed in his place. He was met with the protest that no employee was capable of taking up the work and reminded that the new man had already achieved great success. The president answered that he was willing to lose money in the department for the first year rather than cheapen and disorganize the service by taking away the certainty of promotion and by removing the incentive to study and self-development which had increased the efficiency of every ambitious employee.

Innumerable examples of the same principle in promotions could be gleaned from the records of some of the oldest and most progressive houses in the country. In one establishment visited, the quality of whose wares is strenuously guarded, it was discovered that the chemist and metallurgist in charge of the factory laboratory had been lifted out of one of the departments and supplied with the money to take a specialized course in physics, chemistry, and metallurgy. The advertising manager, the factory engineer, and two or three of the foremen had been given leaves of absence to study and fit themselves for the positions to which their talents and inclinations drew them. Even among the workmen there was a fixed basis for advancement towards the better jobs and the higher rates, dependent on satisfactory service and output.