AMERICAN WAGE CUTS.

New Zealand Herald, Volume LXVIII, Issue 20986, 24 September 1931, Page 8

AMERICAN WAGE CUTS.

The announcement of wage cufs by a number of great American industrial organisations marks an important stage in a hotly-debated question. The concern expressed by the heads of the Labour and Commerce .Departments reiterates the views they have uttered earlier on the subject. Of those enterprises taking the decisive step, the most significant is the L'nited States Steel Corporation. It, was very prominent in the argument and speculation about wage rates at the end of July. A meeting of directors was held on July 28 and it was the centre of attention because the word had gone round that a reduction of wages might be decided upon. The Administration was anxious. It was reported that Washington was greatly relieved when the meeting passed off without any such decision being reached. Instead of making wages a medium of saving, the directors reduced dividends and salaries. The quarterly dividend rate on common stock was reduced from one and three-quarter dollars to one dollar. Percentage reductions of all salaries were decided upon: the Actual rate was not announced, but it was generally understood that the average was about 10 per cent. The position regarding wages was stated thus: "Officials would not comment on the possibility of wage reductions. For the present at least the existing scale will be maintained and it is still believed that, given some improvement in business, the corporation can avoid a cut. The next two or three weeks, it is understood, will determine the corporation's course with respect to its wageearners." Those critical weeks have passed, and the cut has been decreed. This marks a very definite stage in the critical question whether the rates ruling in times of abounding prosperity can be pegged in face of depression. The decision of the United States Steel Corporation will be a severe set-back to those who have opposed reduction, chief among whom stands the Hoover Administration.