The Press WEDNESDAY, OCTOBER 18, 1933. Unemployment

Press, Volume LXIX, Issue 20989, 18 October 1933, Page 8

The Press WEDNESDAY, OCTOBER 18, 1933. Unemployment

Mr Hamilton's statement on the finances of the Unemployment Board, reported in " The Press " this morning, shows that the immediate situation gives no cause for alarm. As far as can be judged from the Minister's figures, there is a reasonable prospect that at the end of the present financial year the Unemployment Fund will be solvent, though it would be interesting to know whether the fund has been subsidised out of the Consolidated Fund in the last few months and whether past subsidies from the Consolidated Fund have been paid back. There is, it seems, little possibility of an increase in unemployment taxation and, owing to the Unemployment Board's heavy commitments, even less possibility of a reduction. But if the immediate position is satisfactory, the wider implications of the Minister's statement are not. At present the country is spending, at the lowest possible estimate, £5,000,000 a year on unemployment, with the prospect that this rate will be reduced only gradually. For a return to the predepression level of business activity will not mean a return to the predepression level of employment. In a recent study of unemployment in New Zealand, printed in the "Eco- " nomic Record," it was pointed out that the number of unemployed assisted to employment increased from 3397 for the year ended March 31, 1926, to 10,268 in the following year, a total of 16,363 being reached for the year ended March 31, 1929. These were years of favourable business conditions, the visible trade balance being favourable and overseas borrowing substantial. Clearly, therefore, the increased unemp'ioy-

ment in the period was not due to ! any slowing down of industry but to other factors, the greatest of which was undoubtedly the increasing mechanisation of productive processes. It may not be unreasonable, therefore, to assume that at least a quarter of the present unemployment is technological unemploy-

ment. Yet the policy and organisation of the Unemployment Board are based on the assumption that unemployment is a temporary problem and only a few months ago Mr Hamilton was talking hopefully of the time when the Unemployment Fund would be " wound up." The time has come to realise that, under modern industrial conditions, there will always be some unemployment due to improvements in methods of production. In New Zealand, since the war, the effects of technological unemployment have been obscured by extravagantly generous expenditure on public works. Since no one will desire a return to this vicious practice, it would be wise to regard the relief of unemployment as a separate and permanent state activity and to reorganise the present system of unemployment relief accordingly In particular, the tangled administrative processes of the Unemployment Board should be simplified and its finances put on a. more satisfactory basis.