The Evening Star THURSDAY, DECEMBER 31, 1931. EMPLOYERS AND EMPLOYEES.

Evening Star, Issue 20989, 31 December 1931, Page 8

The Evening Star THURSDAY, DECEMBER 31, 1931. EMPLOYERS AND EMPLOYEES.

A correspondent signing himself “ p.H.,” to whom wo have extended a free rein, has a few sensible remarks to pass on recent difficulties of employers of labour, particularly small employers. Undoubtedly many of them go on from week to week wondering how they are going to at the same time their banker and their workmen on pay day. But when “ P.H.” states: “ Your past policy of booming economic progress with borrowed capital, of putting up wages and salaries above their earning capacity, and your public mania of taxing the thrifty and industrious has practically killed off the private employer,’’ we are constrained to nib our eyes and wonder whether many of our readers are so mazed by what appears in our columns or are so mentally warped as to take out of them the opposite meaning of what they are intended to convey. If there is one subject on which we thought we had made ourselves plain it is the retarding effect on recovery exercised by our far too rigid wages system. In fact, privately we have often wondered what Mr William Pember Reeves, at present chairman of tho board of the National Bank of New Zealand, thinks of tho handiwork of the Hon. William Pcinber Reeves, first Minister of Labour in a New Zealand Cabinet. Mr Reeves was elected to our House of Representatives in 1887, and took office under John Ballance in 1890. Within five years he had placed on the Statute Book a complete code of labour legislation, including the Industrial Conciliation and Arbitration Act. In all essentials bis measures form New Zealand’s labour code to-day. As long as there was an era of rising prices tho code was for tho most part accepted. Tho moment tho price apex was passed, the code’s rigidity became not only irksome, but in some cases throttling. The 1028 Industrial Conference proceeding:! disclosed that the great majority of the employers’ representatives were anxious to restrict or abolish the compulsory powers of the court; but those powers of compulsion were rightly regarded by Mr Reeves in 1894 as tho very marrow and essence of the whole system. Docs Mr Reeves retain tho same view to-day? As a bank chairman in London he is bound to take wide and deep interest in the lot of tho Now producer and his effort to avert production at a loss. And ho cannot ho unaware that a rigid wage system, not alone in primary industries such as farming, hut in secondary industries which can only survive a rigid wage system by the help of a stiff protective Customs tariff, greatly swells farmers’ costs of production. The demands for the abolition of the arbitration system have repeatedly come chiefly from farmers and their organisations. And in present 'conditions who can blame them? Wc have not latterly boon stressing this view because wc not long ago expressed our

conviction that of the two factors keeping the fanners clown —excessive interest on borrowed capital and a rigid wage system—attention should first be devoted to casing the former of the two burdens. “ IML” rightly enough protests against a system whcrciuider “ Hodge’s ” womenfolk are too often “ slushies ” for the hired labour. Until production is again at a profit there can be no real revival of world trade; and until world trade revives New Zealand is likely to remain in the doldrums. Export prices are unlikely soon to soar to anywhere near peak prices touched in the last decade, and the only alternative is to cut costs of production—interest and taxation first, and a rigid wage system next. Wo are completely at a loss to understand why “ P.H.” should insist that wo advocate that the private employer should beggar himself in a vain effort to employ labour while producing at a loss. Whether it is a question of primary or secondary industries, it is imperative that production shall be at a profit, and if our New Zealand legislation is proving a big obstacle to that aim, there must bo something wrong with that legislation.