LABOR RECORDS
1. The successful outcome of any project, in whatever field of endeavor, depends on the coöperation of labor. Labor is energy applied. The intelligence with which the energy is applied determines its productiveness. The unskilled laborer applies energy, in the form of his own strength, directly to the task before him. The skilled worker uses his skill to direct the energy of nature that has been applied to propel machines and appliances, which in turn have been created by the skillful manipulation of inanimate properties. Thus the combination of natural forces and the intelligent application of those forces, under the direction of a skilled man, result in the highest degree of productiveness.
In the employment of labor, there are two parties to be considered—the employer of labor and the seller of labor. The desire of the first is to secure the results of the labor at the lowest possible cost per unit of production rather than at the lowest cost per individual. The desire of the second is to secure the highest price for his labor, based on the unit of time rather than on the unit of production.
In the final analysis, the desires of the two are found not to be inconsistent, nor opposed to each other. The employer cares little what labor costs per unit of time, provided the cost per unit of production is kept down to the lowest point; the seller of labor cares not how many units of production result from his labor provided he is paid a satisfactory wage.
The ideal method of regulating the payment of wages is, therefore, one which will insure to the laborer a high wage under conditions resulting in a correspondingly high rate of production. To solve this problem, to evolve an ideal system, has long been the study of engineers. The studies of these men are bound to have a far-reaching effect. From the older method of an exclusive day wage to the modern systems that combine day wage and piece rates, is a long step. Investigations and experiments, now going on in all directions, are carrying the movement forward, and are destined to evolve an ideal system.
WAGE SYSTEMS
2. Wage systems, as applied to manufacturing industries, may be divided into the general classifications of day wage, piece rate, and premium systems. Besides these three, there are a number of systems, bearing the names of their originators, which are the result of a combination of certain features found in two or more of the three general methods. A study of modern wage systems necessarily involves a study of the distinguishing features of the three primary methods.
3. Day Wage. Of the three general plans on which labor is paid, the oldest and best known is the day-wage plan. It is the most widely used because best understood. The day-wage plan contemplates the payment of a stated wage for a stated unit of time. If all men performing the same task were equally skillful, or if the wage rate could be adjusted in conformity with the varying degrees of productiveness found in every body of workmen, the day-wage plan would be ideal. But neither of these conditions exists.
Workers are liable to insist on the application of the rule of organized labor, that all men performing similar tasks shall be paid the same wage. Since all men are not equally skillful, this results in certain inequalities. On the one hand, the wage rate is based on the lowest rate of production, which is unjust to the more skillful man, who either reduces his productiveness to the level of the least skillful, or transfers his energies to another field of endeavor. As an opposite extreme, the rate is based on the highest rate of production, which is manifestly unfair to the employer.