Statement showing the Average Incidence (ad valorem) of the Import Duties levied by Germany on British Cotton Goods.

Average Value of
Exports from the
United Kingdom
to all Countries
in 1902.		Rate of Duty
estimated
Equivalent.		Approximate
Equivalent
Rate of Duty
ad valorem.
Cotton manufactures— Per Cent.
 Piece goods, unbleached 2.01d. per yd.0.87d. per yd.43
  ”  ” bleached 2.46d. ”1.09d. ”44
  ”  ” printed 2.68d. ”1.31d. ”49
  ”  ” dyed, &c. 3.46d. ”1.31d. ”38
Cotton thread for sewing26.89d. per ℔3.81d. per ℔15
Cotton yarn—
 Grey10.49d. ”0.98d. ” 9
 Bleached or dyed11.23d. ”1.63d. ”15

The duties are not prohibitive—they are much less than those of the United States at the same time—but they are heavy on the classes of goods which come into competition with home-made goods. The general principle of the tariff is to treat easiest commodities which are made with least success at home, or are in the highest degree raw material for a home manufacture. Therefore yarns are not taxed very heavily, and of these the finest counts escape with slight discouragement.

In the cotton industry, as well as in numerous other industries of Germany, almost feverish activity was shown after the Franco-German War. Previously great advance had been made, but it was not until the last quarter of the 19th century that Germany forced herself into the first rank. As measured by the annual consumption of cotton the German industry increased as follows:—

Metric Tons of Cotton per Annum.

(In Thousands.)
1836-18409  
1856-186046  
1876-1880124  
1886-1890201  
1899-1903324  

It must be remembered that the spindles and looms of Alsace and Lorraine were reckoned as German after the war: they amounted in 1895 to one and a half million spindles and nearly forty thousand looms.

In the ’seventies there was no dispute as to England’s substantial lead in respect of efficiency. Alexander Redgrave, the chief factory inspector, made inquiries on the continent both in 1873, when Lancashire was anxious as to the comparative cost of production abroad because of the short-time bill then before parliament, and previously, and reported most unfavourably upon the state of the industry in Germany. Hours were long, the skill of the hands was inferior, speeds were low and time was wasted. In several important respects his views were corroborated by M. Taine in his Notes on England, and by the evidence adduced before the German commission upon the cotton and linen industries in 1878. A marked contrast is noticeable between the sketches drawn of this period and the careful picture presented by Professor Schulze-Gaevernitz of the early “’nineties,” but even in the latter the advantage of England is represented as substantial in every essential respect. The gap which existed has narrowed, but it is still unmistakable. To give one example, according to Dr Huber’s figures there were in Saxony at the end of the 19th century 106 spindles to an operative and about as many weavers as looms, whereas in England there were about twice as many spindles to an operative and twice as many looms as persons engaged in weaving sheds.[61] As regards manufacturing, the character of the product may partly explain the difference, but it will not entirely. The reader need hardly be warned that the comparison drawn is exceedingly rough. German cotton operatives taken all round are certainly less efficient than English labour of the same kind. The reason is partly that the proportion of the German workpeople who have been for long specialized to the industry, and look forward to continuing in it all their lives, is not high. Complaint is constantly made of the number of vacancies created in the mills each year by operatives leaving, and of the impossibility of filling them with experienced hands. Many of the vacancies are caused by the return of workpeople to the country parts. Sometimes the mills are in the country, or within easy reach of it, and labour is obtained from the unoccupied members of peasants’ families. In these cases the factories do not always succeed in attracting the most capable people, and work in the factory is not infrequently looked upon as a makeshift to supplement a family’s earnings. Among Lancashire operatives far more pride of occupation may be met with. In many of the industrial parts of Germany English conditions are evolving, but they are not generally the rule. An American consul may be taken to report to his own country without prejudice as to the rival merits of German and English conditions: one such wrote in 1901:—“The task of educating labour up to a high degree of efficiency is difficult, and many generations are necessary to achieve that result. The English cotton spinners have attained such a degree of skill and intelligence that, for the most part, no supervision is necessary. In Germany the presence of a technical overseer is indispensable. Another advantage which England enjoys is the cheap price of machinery. Germany imports the major part of her machinery from England, and German wholesale dealers in these machines have not been able, by placing large orders, to overcome the difference caused by freight and tariff.” Wages reflect the efficiencies of countries, not of course perfectly, but in some degree. They are much higher in Lancashire than in Germany, as is made evident by an article from the pen of Professor Hasbach in Schmollers Jahrbuch (vol. ii., 1903). The author tries to show that Germany is not so far behind England industrially as is generally believed, and the contrast drawn by him, greatly to the advantage of Lancashire, is not likely to exaggerate the superiority of English conditions. It is calculated by Professor Hasbach that the daily wages of spinners are about 5/10 to 6/10 at Oldham, 6/6 at Bolton and 5/6 in Stalybridge and neighbouring places. With these he compares the 3.70 to 3.80 marks paid in the Rhine Province and Leipzig, and the 3 to 3.15 marks paid in the Vogtland, Bavaria and Alsace, and mentions an exceptionally high wage of 42⁄3 marks, which was earned by an operative who worked a new and long doubling mule. The wage paid to the big piecer in England, Dr Hasbach goes on to show, is not much greater than that received by a good assistant in Germany. This comparison as it stands will probably give some readers an idea that English advantages are greater than they actually are, because it may be overlooked that the great difference between wages in the case of English and German spinners is not repeated among the piecers. Taking a spinner and his first assistant as the unit, we should have a joint average daily wage of about 8/6 in England and 6/6 in Germany. In the case of weavers, comparison of wages is more difficult to draw, but the advantage of England would seem to be but little less. However, in instituting a comparison between two countries, as regards the relative efficiency of labour in some industries, we should do well to remind ourselves that efficiency is a somewhat transitory thing, dependent upon education and experience as much as upon aptitude. In respect of the capacity of labour for the task required in the cotton industry, we could not (writing in 1907) make the statement that England leads significantly with the assurance with which we can assert her superiority in respect of present attainments. The cotton industry has not been prosecuted on a large scale in Germany so long as in England, and the Germans have not, therefore, had the same opportunity for developing their latent powers. But the thoughtfulness and carefulness of the German workman are beyond dispute, and these qualities will procure for him a leading place where work is not mechanical. Already in the cotton industry it is said that the operatives are displaying quite striking powers of undertaking a wide range of work and changing easily from one pattern to another. Hence German firms feel little hesitation in taking small orders on special designs; they do not experience any great difficulty in getting their factors accommodated to produce the required articles.

Apart from the efficiency of labour, reasons exist for the lower real cost of production in England in the organization of the industry. The German industry is not only less localized, but, as we might perhaps infer from that circumstance, less specialized. A German factory will turn out scores of patterns where an English firm will confine itself to a few specialities. Time is wasted in accommodating machinery to changes and in accustoming the hands to new work. The German producer suffers from the undeveloped state of the market. In England specialized markets with specialized dealers have greatly assisted producers both in their buying and selling. A German manufacturer may have to find his customers as the English manufacturer need not; at least, so Professor Schulze-Gaevernitz has assured us, and conditions have not been wholly transformed since he made his careful analysis. He wrote:—“But especially disadvantageous is the decentralization in respect to the sale. Here also the German manufacturer stands under the same disadvantages with which the English had to struggle in the ’thirties. The German manufacturer still seeks his customers through travellers and agents, and in many instances through retail sellers, whose financial standing is often questionable, whose necessity for credit is always certain. Hence the complaints about the bad conditions of payment in Germany which crop up continually in the enquête. The manufacturers had to wait three, four or six months, and even twelve months and longer for payment. In reality there existed ‘termless terms,’ a ‘complete anarchy in the method of payment.’ ... The manufacturer cannot be at the same time commission agent, banker, merchant and retail dealer; he needs sound customers capable of paying. He fares best if the sale is concentrated in one market, and ‘change’ prices simplify the struggle between buyer and seller. The search for customers, foreign as well as home, and the bearing of all possible risks of disposal, are in any case difficult enough to necessitate the whole strength of a man. The wholesale merchant alone is in a position to pay the manufacturer in cash or on sure, short terms. But especially where export is in question is the dispersal of sales an extreme impediment. The manufacturer cannot follow the fashions in Australia and South America; the foreign buyer cannot travel from mill to mill.”

It is the want of commercial development in Germany which accounts for the more frequent combination of weaving and spinning there than in England. But in Germany to-day economic enterprise is flourishing, and commercial development may confidently be looked for together with advance in other directions. It is not many years since the typical German cotton factory was comparatively primitive; now mills can be exhibited which might have been erected recently in Oldham. Between the early ’eighties and the ’nineties the expansion of the German industry was enormous—the imports of cotton-wool rose by nearly 70%—yet the number of spinning-mills was actually reduced from 6750 to 2450, while the number of weaving-sheds fell from 56,200 to 32,750. At the same time the factories devoted to mixed goods declined from 25,200 to less than 16,350. From these figures we may gather how rapidly the average size of mills and weaving-sheds enlarged in the period. One cause, no doubt, was that improved economies in the new businesses forced antiquated factories to shut down and make way for still newer erections. There were recently about twice as many persons engaged in weaving as in spinning, but the largest numbers of all—slightly in excess of those in weaving-sheds—were the persons occupied in the manufacture of cotton-lace, trimmings, &c. As we might imagine, Germany’s exports of cotton goods are not high. Including yarns they amounted to £13.7 million per annum in 1899-1903. In order of value their largest exports are (1) coloured goods, (2) hosiery, (3) lace and embroidery, (4) yarns, and (5) trimmings, &c.