Wages the Remuneration of Labor 1

worker, cent, workers, business, profits, elements, wage and ability

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Between the extremes are the able subordinates, smaller managers, and dealers and professional men of average ability; in other words, men who are equipped to do the everyday mechanical and clerical tasks, and the large group of laborers and workers not specifically trained for special tasks but possessed of strength and endurance for manual labor.

The analysis of the staff of a department store in any large city reveals many grades of workers. First, there are the responsible officials in charge of the organization. In the next grade are those who fill well the task of departmental managers, and so on, the list showing many grades of workers of various abilities. Within each grade, too, there is variation, from the men who draw the highest pay to those who receive the smallest return of any in the group. These last are marginal workers, who are always in a quandary as to whether or not it is worth while to remain in their occupation.; but who do so because their ability and efficiency are recognized as fully as they would be in any other kind of work.

Between this type of individual and the better paid and more efficient worker there is a wide range, due to the superiority of the work of the latter as compared with tbat of the former. Tbe higher-salaried worker receives the wages of the marginal worker plus a dif ferential payment that is a recognition of the higher ability and efficiency of the better worker. Some familiarity with many businesses and industries re veals a similar tendency in all of them. Everywhere, not only are there groups of workers, but in the groups there are many gradations, from the worker on the edge of the group to the highest paid member at the top.

5. Wages of managenzent.—There is a twilight zone between profits and wages of management, which has made many a small proprietor imagine that he was making a profit when his return was no greater tha.n what lie would have received if he had been em ployed by his competitor. The manager must receive the minimum return or go out of business and seek employment as a salaried man. Yet there is a con siderable difference between wages, salaries and profit. While it is true that the enterpriser must have, in the long run, an amount equal to what his services would command in the market, nevertheless his re turn constantly carries with it an uncertainty which varies with his success as an independent, operat ing business man.

The growth of the corporation has materially em phasized the various elements in what is often called gross profits, and has concealed some of the elements that are involved when the business is conducted as a partnership. These elements really include interest, wages of management and net profits, but in all cases gross profits must be earned over and above the ex penses paid out for materials, rent and wages. Un der present conditions, the managers of a corporation are salaried officers, the stockholders are risk-takers and the bondholders interest-receivers. The stock holders are the real profit-takers.

6. Industrial grades among workers.—According to the census of 1910, there were 38,167,336 persons of both sexes engaged in gainful occupations. About 33 per cent were engaged in agriculture, five per cent in the professions, 14 per cent in domestic service, 20 per cent in trade and transportation, and 28 per cent in manufacturing and, mechanical pursuits. From this statement the important fact is gleaned that one third of the population is engaged in gainful occupa tions, which are subdivided into many hundred dif ferent trAdes and callings, each requiring more or less skill. These people do not compete with one another for position and wage; but in small groups, and in many different lines of work, they come in contact with their fellows in a limited competition.

Into some of these groups new members are con stantly entering in ahnost unlimited numbers, while in others the increase is comparatively slow. This fact emphasizes the variation in wage payment and raises the caution against the tendency to regard the wage problem as one connected with vast armies of workmen instead of one that has to do with non-com peting groups.

While there is a solidarity of labor in the common interest of better standards of living, of a larger in fluence in the affairs of state, and in the conduct of business everywhere, nevertheless the laborer at work in the mines of Michigan does not compete with the fisherman in the oyster industry of Chesapeake Bay. If there were no such variations, due to distance, climate and differences in the character of the work and the skill required, wages would be the same in all groups, except in so far as the tasks imposed varied in agreeableness.

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