Wages in 1873: Address read before the Social Science Association at Norwich

by Earl Thomas Brassey Brassey

I can only repeat once more that, in the present condition of our trade, there is nothing to justify serious misgivings as to our power of continuing a successful competition with foreign producers. It does not follow that, because we have lost a monopoly of a particular branch of trade abroad, the skill of the English workman must have deteriorated, or the cost of production have been unduly enhanced by the rise of wages. Foreign countries may have imported from us a particular commodity at a former time, solely because they were entirely inexperienced in its manufacture. When my father was executing the Rouen and Havre Railway, he imported the rails from England, although he had to pay an import duty at the French Custom-house, amounting to a considerably larger sum than the selling price of the rails at home. The almost incredible difference between the price of English and French rails at that time no longer exists: because that special branch of industry is now as well understood in France as in England. So, too, in the case of the employment of English contractors for the execution of public works on the Continent. An opportunity was offered to them in the origin of the railway system on the Continent; because in those early days of railways there were no native contractors, sufficiently acquainted with the art of making railways to venture to compete with the English invaders. Their intelligent observation of our methods of construction soon enabled the contractors on the Continent to tender in competition with the English; and for many years past all the railway works in France have been carried out by Frenchmen. It does not follow that the English contractor has lost his former skill. The true inference is, that the French, who had been previously in a position of inferiority solely from lack of experience, were enabled, as soon as they had gained that experience, to execute the works required, without the assistance of foreigners.

The development of our commercial relations with France, since the negotiation of the Treaty of Commerce, affords convincing proof of the great capabilities of our manufacturing industry. Since 1860, the exportation of iron, wrought and unwrought, to France has increased in value £540,000.

Looking therefore to the present condition of our iron trade, there is nothing to justify serious misgivings. According to the last report of the Commissioners of Customs, the average value of the pig iron exported in 1870 was £2. 19s. 2d. per ton; in 1871, £3. 1s. 8d.; in 1872, £5. 0s. 11d.; and yet the demand for pig iron continued unchecked. The increase in the quantity exported in 1872 over 1871 was 28 per cent. The increase in the price ranged as high as 108 per cent.

While the export of pig iron attained to the figures I have quoted, the total increase in the exports of iron and steel manufactures did not exceed 6.7 per cent. Indeed the manufacture of steel actually fell off from a value of £683,000 in 1871, to £623,000 in 1872; a result the more remarkable as compared with the increase in pig iron, because the price of steel had not advanced in the same proportion as the rise in pig iron. The price of the latter article had risen, as I have said, from £3. 1s. 8d. to £5. 0s. 11d. per ton; while unwrought steel had only advanced from £30. 12s. 3d. to £32. 18s. 7d. per ton, and steel manufactures from £52. 8s. 1d. to £55. 4s. 10d. per ton.

Hence it would appear that a demand once created for an article of the first necessity, such as iron, is not easily checked, even by a very marked advance of price.

It must, however, be remembered that, when the course of trade has been changed, and consumers, alarmed by the high prices in our market, have been taught to look for their supplies in another, the position once lost is not easily recovered. The superiority of our artisans in skill and industry has assisted our manufacturers to compete successfully in the past. The same success will not be maintained in future, unless our employers and workmen continue, as before, to use their united efforts to reduce the cost of production.

Shipbuilding.

Perhaps no branch of industry has been more successfully prosecuted in this country than shipbuilding; and the extensive use of iron for ships of the largest type makes it a point of great interest to ascertain how far the cost of building ships has been affected by the recent advance of wages. I am informed by an eminent firm of shipbuilders, that at the close of 1871, shortly after the reduction in the hours of labour from fifty-nine or sixty hours a week to fifty-four, an agitation was commenced amongst all classes of men for an advance in their rates of wages, which has been, in some shape or other, conceded to them, to the extent of from 7½ to 15 per cent. In reality, this was the natural consequence of the reduction in the hours of labour; although, at the outset the leaders of that movement professed that they had no desire to raise the rates of wages.

The reduced hours of labour increased the cost of production of all articles, and led to the necessity for an advance in the rates of wages. In point of fact, the advantage of the reduction in the hours of labour being conceded, on social and moral grounds, the necessity for some corresponding advance in wages followed as a matter of course, and was perhaps not unreasonable. The two causes combined have resulted in an increased cost of production, so far as labour is concerned, of from 20 to 25 per cent. The cost of building first-class steamers and first-class marine engines has, in consequence of the rise in wages and materials, been increased from 30 to 40 per cent.

The actual diminution, by the nine hours’ movement, in the amount of work, turned out with a given plant, should, in theory, be only in proportion to the reduced number of the hours of work, or, say, about one-tenth. It is in reality from 15 to 20 per cent.