Next: Wages?

P: At Camden, N. J. last week, New York Shipbuilding Corp. ordered a 10% cut in all wages and salaries.

P: At Akron, Ohio, 13,000 employes of Goodyear Tire & Rubber Co. took a 12% pay-reduction as their share of the "economic readjustment."

P: In Newark, N. J. union painters went on strike rather than have their daily wage cut from $12 to $10.

P: In contrast to the trend of the times, M. J. Meehan & Co. Manhattan brokers restored the 12 1/2% snipped from their employes salaries last year--but did not take back all pre-Crash employes.

These and many another wage change served last week to focus public attention upon the effects of Depression on the nation's pay envelope. In the light of Industry's pledge to President Hoover in November 1929, to maintain existing wage scales as the surest means of recovering prosperity, were wage cuts now the exception or the rule?

President Hoover reiterated his faith in high wage policy, doubted the existence of any "organized movement" on the part of Industry to break its 18-month-old pledge (see p. 13). Nevertheless, across the land spread an undercurrent of report and rumor that wages had already been hacked some and would be hacked more unless there was a sudden, miraculous business improvement. Workers fidgeted with fresh anxiety; employers, frankly worried, would not commit themselves on future wages.

A distinct wage-cut movement came into sight at last October's meeting of the American Bankers Association in Cleveland. President Hoover vigorously scotched it. But bankers have talked ever since about the "necessity of liquidating wages," i.e. pruning them down to the reduced level of commodity prices. Such men as Albert Henry Wiggin. chairman of New York's Chase National Bank, and Melvin Alvah Traylor, president of Chicago's First National Bank, have openly endorsed wage cuts. They argue that Labor as well as Capital must take its losses and that until it does there can be no economic recovery. Against this argument is set that of the Hoover Administration, to wit: wages during Prosperity went no where near so high, comparatively, as commodity prices, business profits and dividends; therefore they should not come down with the general decline.

In Government service the most outspoken man against wage cuts was white-crowned, white-whiskered Ethelbert Stewart, U. S. commissioner of labor statistics. whom strangers might mistake for Mark Twain or Mr. Justice Oliver Wendell Holmes. He declared last week that his office had been bombarded with requests from bankers for data to justify pay cuts. Said he: "Some banks and bankers are hell-bent to get wages back to the 1915 level. Everybody but a few old fossils are in favor of high wages. Most banks can't get away from interest and dividends. That's all they can see. Any talk of lowering interest rates or omitting dividends is immediately resented and the old-time remedy of reduction of wages is proposed."

The alert United Press interviewed business leaders who attended the 1929 White House conferences, discovered an agreement among them that Industry, by & large, had lived up to its wage pledge. Pierre Samuel Du Pont (I. E. du Pont de Nemours & Co.), Walter Sherman Gifford (American Telephone & Telegraph). Jesse Isidor Straus (R. H. Macy & Co.) declared their companies had not reduced their wage scales since 1929. Walter Clark Teagle said his Standard Oil of New Jer sey had found it necessary to cut workers' weekly earnings by part-time employment but that the base pay rate had been maintained. Distinctly out of harmony with President Hoover was Indiana's Republican Congressman William Robert Wood, chairman of the House Appropriations Committee, who last week said: "Either wages should come down or commodity prices should go up. The wage level is far above the selling level."

The size and extent of wage cuts have kept the country's best statisticians at work for months. The national industrial conference board estimates that the wage scale in this Depression has declined 3% but that earnings have dropped 20% because of layoffs and part-time employment. The A. F. of L. concurs in this estimate, sets lost earnings at ten billion dollars per year. Meanwhile the U. S. Department of Labor reports that commodity prices have decreased 21% since July, 1929 while industrial payrolls are down 13%. Last February, according to the Bureau of Labor statistics, 228 industrial establishments cut wages an average of 10%, affecting 39,096 workers.

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