9. Attitude toward employes.—The attitude of many managers toward the selection and the discharge of employes is one of extreme indifference. Nothing illustrates this better than the manner in which testi monials are frequently written. A discharged drunk ard oftentimes receives a testimonial that he has been found sober and industrious while the discharged crook will be praised for honesty and industry.
The newer attitude toward employes is evidenced in the interview, the application blank, the physical examination and the psychological tests which are being used to prove or disprove the validity of the testimonials submitted by prospective employes.
Competition is forcing business men to seek new economies. All plants are approaching similar levels of competition in equipment, machinery methods, purchasing skill, price of raw materials and prompt ness in deliveries. In the near future, the varying grades of competitive success will be decided by the savings made thru the elimination of the wastes due to a high labor turnover and by the removal of those mal adjustments that prevent a business organization from taking effective root in inodern economic condi tions.
10. Causes of the turnover.—The reasons why men leave jobs are, of course, as numerous as the chances for the misunderstandings, mismanagement and mal adjustments that grow out of men's relations to one another and to their work. Investigations of the turn over of factory labor show the following factors which figure in it : Abundance or lack of work, fluctua tions in the amount of work-, rates of wages, character of working conditions, efficiency of management, rela tions between the men and the management, work men's opportunities to secure better work, and their qualifications or lack of qualifications for that work. Two cases that are given as typical indicate the na ture of the questions with which modern management must deal in solving the problem of turnover wastes.
Case I. In a lumber mill, in 1915, 49 men were dis charged in 8 months for : Incompetency 20 Insubordination 13 Drink 12 Poor health 4 Case II. In 3 metal-trades establishments, during 1913, 402 men were discharged for: Incompetency 133 Unsteadiness and loafing 36 Disobedience 30 Slowness, sleepiness 16 Drink 14 Miscellaneous 11 No reason given 162 The significant thing about these tables is the large number of discharges due to causes which in most cases could have been avoided by the exercise of greater care in the selection of the men, while un doubtedly many employes might have been saved to the firms if they had been given a chance in other de partments instead of being summarily dismissed when found unsatisfactory.
11. Reduction of labor of labor turnover is a source not only of vexation, but also of expense. Anything which can be done to re duce the turnover avoids expense and makes the fac tory run more smoothly. The establishment of an employment department in some cases produces these very satisfactory results.
An instance of what has been achieved by one com pany in the direction of reducing labor turnover thru the careful selection and follow-up of employes, is shown by the following statement: Year Labc 1911 1912 1913 1914 1915 ir turnover 68% 61% 52% 37% 28% This company employs 2,300 persons and estimates that it costs, on the average, $50 to replace a proficient hand. In the second year of the new system there were savings of about $25,000 over the year preced ing its installation.' 12. Labor a relationship.—Labor as one of the im portant relationships in the structure of a business or ganization, is one of the newer conceptions determin ing the solution of employment problems. Labor ex ists only in the act by which it is sold, and it cannot exist unless it is given access to capital. It is not a commodity in the sense that the workman can store up stocks of it to be used as a basis.on which to bargain for work.
If a business organization were an association where the three prime factors of labor, capital and manage ment which are engaged in production, shared alike in the profit and loss and in the government, the nature of employment and the consequent wage and labor problems would be entirely changed. But the busi ness unit has been developed along other lines. Labor does not bear the risk, nor is it entitled by law to a share in the accumulated stock, the right of business initiative, the management and the credit of the con cern. These belong solely to those who supply the capital, while labor discounts its risks for a fixed peri odical wage. Because of the exclusion of this essen tial factor of production from the management, and because labor cannot be accumulated as a "reserve," the workman has attempted to protect his interests and to strengthen his bargaining powers by the for mation of trade-unions.