§ 13. Specialisation within the Town.
§ 1. Turning once more to the unit of industry, the Business, and thence to the Trade and the Market, or area of competition, it is necessary to examine the structural and functional changes brought about by the action of the new industrial forces.
In considering the effect of modern machine-production upon the Business, the most obvious external change is a great increase in size. The typical unit of production is no longer a single family or a small group of persons working with a few cheap simple tools upon small quantities of material, but a compact and closely organised mass of labour composed of hundreds or thousands of individuals, co-operating with large quantities of expensive and intricate machinery, through which passes a continuous and mighty volume of raw material on its journey to the hands of the consuming public.
The expansion in mass of labour and capital composing the industrial unit does not, however, proceed at the same pace in the different industries.
The largest growths are found in two classes of industry. First, those which close dependence on monopoly of land, or other privilege conferred by state or municipal government, has placed outside competition. The size here is determined by that amount of capital required to achieve the most profitable equation of supply and demand prices under terms of monopoly.[99] In this class are placed such large businesses as railways, gas, or water companies. Second, those industries where the net advantages of large-scale production over small scale in competitive industry are greatest. Generally speaking, those industries where the most expensive machinery is employed come under this head, or where, as in banking and financial business, a large capital is managed more economically, and enjoys a monopoly of certain profitable kinds of work.
In retail trade, where neither of these forces is so powerfully operative, the increase in mass of capital and labour is not so great, though here too the economies of large-scale production are giving more and more prominence to the Universal Provider, and a large number of local shops are falling into the hands of companies. Large syndicates of capital at Smithfield are owning butchers' shops in most large towns, the drapery, jewellery, shoe trade are more and more passing into the hands of large companies, while an increased proportion of tobacconists, publicans, grocers, and other retailers are practically but agents of large capitalist firms. In such branches of agriculture as have lent themselves most effectively to new machinery the same movement is visible in the prevalence of large farming. This is seen everywhere where land is placed on the same property footing as other forms of capital. Though small farms are for some purposes still capable of yielding a large net as well as gross product, it is for the most part the legal, customary, and sentimental restrictions on free transfer of land that impede the tendency towards large farming.
It is, however, in the manufacturing and transport industries that we trace the most general and rapid growth of the unit of production. And here machinery is the chief external cause. Gigantic railways and steamship companies are the successors of stage coach businesses and small shippers. The size and value of the modern cotton factory, iron works, sugar refinery, or brewery are incomparably greater than the units of which these industries were composed a century and a half ago. In certain highly-machined industries the size of the unit is so enlarged that the number of businesses engaged in turning out the ever-growing output is actually diminishing. Among textile industries the spinning mills of England and Wales show a marked diminution in numbers between 1870 and 1890, while a similar movement in weaving mills is only retarded by the capacity of small sweating masters to compete with the more developed factories in certain minor branches, such as tape manufacture, and by the survival of the home worker owning his loom and hiring his power in such trades as the ribbon weaving of Coventry.[100]
The following statistics[101] of the cotton and woollen industries in Great Britain serve to illustrate the growing size of the unit of production in the representative branches of textile work:—
| Cotton. | ||||||||
| No. of Mills. | No. of Spindles. | |||||||
| Spinning. | Weaving. | Spinning and Weaving. | Others. | Total. | Spinning. | Doubling. | Power-Looms. | |
| 1870 | 1108 | 693 | 532 | 150 | 2483 | 33,995,221 | 3,723,537 | 440,676 |
| 1890 | 935 | 990 | 438 | 175 | 2538 | 40,511,934 | 3,992,885 | 615,714 |
| Woollen. | ||||||||
| 1870 | 648 | 109 | 860 | 212 | 1829 | 2,531,768 | 160,993 | 48,140 |
| 1890 | 494 | 124 | 895 | 280 | 1793 | 2,107,209 | 299,793 | 61,831 |
This increase of the number of spindles and looms in the average textile mill is more significant when the "speeding up" of modern machinery is taken into account. The increased size of the unit of industry as measured by productivity is even greater than appears from the statistics above quoted.