I make the assumption that the average working year of the 14,500,000 remaining wage-earners consists of 44 weeks. Applying the average wage already arrived at (21s. 3d. per week), we get an average annual earning of, say, £46. 15s., which gives us £678,000,000 as the probable aggregate earnings of the 14,500,000 workers. Adding the £25,000,000 assumed to be earned by the remaining 1,000,000, we arrive at £703,000,000 as the total earnings of the manual labourers in 1908.
It is probable that this calculation does not take sufficient account either of the changes of occupations since 1886, or, as has been already pointed out, of the changes in the respective proportions of men, women and children employed. The average wage of the 1886 Census, taken as the basis of the calculation, was, it is necessary to insist, exaggerated by the omission of the most ill-paid workmen, while the returns upon which it was based, framed as they were by employers, are only too likely in a proportion of cases to have put the wages paid in the most favourable light. The employers again, who filled in the forms, were only some 75 per cent. of the firms applied to by the Board of Trade, and it is a fair inference that those who neglected to reply had no excessive pride in the records of their wage-sheets. I submit, therefore, that as the 1886 average wage figure is a liberal estimate,[8] the figure which I have deduced from it does not, in all probability, err on the side of under-estimation.
Professor Bowley estimates the total paid in wages in 1901 as £705,000,000,[9] and the Board of Trade in the Fiscal Blue Book of 1903 (Cd. 1761) say:—
"From investigations based on the Board of Trade Census of Wages (1886) combined with the recorded changes of wages since that date and the distribution of the working population among various industries as shown in the census returns, the total wages bill of the United Kingdom has been estimated at between £700,000,000 and £750,000,000, according to the state of employment."
The estimate which I have given, therefore, differs but little from those of Professor Bowley and the Board of Trade.[10] I prefer to use the smaller figures on several grounds. In the first place, the allowance for "play" is a conservative one. In the second place, I have the gravest doubts as to the propriety of including in the estimates of the wages of domestic servants, sailors, and others, an allowance for the value of "lodging," as is done in the figures used. To include so many shillings a week for the accommodation afforded by a seaman's bunk or a general servant's fraction of an attic is to flatter "earnings" out of all resemblance to the truth. The free cottages and other allowances to agricultural labourers are often of a scarcely marketable character. We may be justified in valuing an unhealthy hovel at 1s. 6d. per week, in view of the fact that the labourer, if he had it not, would need to pay rent elsewhere, but in too many cases the "cottage" is fit not for inhabitation but for demolition. In the third place, no allowance is made for the excessive rents paid by workmen in London and other large towns. These rents are really part of the working expenses of the wage earners, and there is as good ground for making deductions on account of them as there is for deducting wear and tear of machinery in the case of income-tax incomes.
We can now arrive at an approximate estimate of the National Income as a whole in 1908-9 (say 1908).
THE NATIONAL INCOME IN 1908
| (1) | Persons with incomes which exceed £160 per annum | £909,000,000 |
| (2) | Persons with incomes below £160 per annum:— | |
| (a) Persons earning small salaries, petty tradesmen, etc. | 232,000,000 | |
| (b) The wage-earning classes | 703,000,000 | |
| £1,844,000,000 |
It will be seen that the income tax exemption limit of £160 per annum splits the national income into two almost equal parts. Of a total income amounting to £1,844,000,000 in 1908, those with over £160 per annum took £909,000,000, while those with less than £160 per annum took £935,000,000.
[1] Figures examined in "Riches and Poverty" (1905), Chapter 2.