Poverty Bay Herald. PUBLISHED EVERY EVENING GISBORNE, MONDAY, APRIL 7, 1930. UNEMPLOYMENT INSURANCE

Poverty Bay Herald, Volume LV, Issue 17228, 7 April 1930, Page 6

Poverty Bay Herald. PUBLISHED EVERY EVENING GISBORNE, MONDAY, APRIL 7, 1930. UNEMPLOYMENT INSURANCE

It may be useful to continue the remarks offered in these columns a day or two ago regarding the economic aspects of the unemployment problem, by referring to .that of unemployment insurance, and particularly to Britain’s experience in regard, to it. The front ion of a national, eompulsorv and contributory scheme of insuranee has been quite a live issue in New Zealand polities for some time, and tlie whole subject has been fully denlt. with in the report of the committee set up to investigate the whole matter. What we can learn from the Mother Country on the subject cannot be without its value. It is interesting that Mr. E. T. Good, writing in a contemporary .British monthly, who claims to be the first; person to suggest. the scheme of unemployment insurance now in operation in the Old Country, has, among others of a like sort, this significant sentence: “After "lint I have seen of the scheme and its results, I apologise.” After twentylive years of observation ho has been forced to the conclusion that there is no complete cure for unemployment, and such a conclusion would seem to be meeting with increasing approval as time goes on. It should not be mistaken for a counsel of despair, but regarded rather as a statement of necessary fact. Just as we shall probably always have those who are better off than others, so we shall have those who have more work than others. Industrial activity and enterprise are in a state of continual flux which inevitably affects the labor market; commerce fluctuates, fashions change, seasons come and go, public taste alters, fads are born and die, and all these things arc going to continue, whatever else may change in the world of tomorrow; and all these tilings are going to determine the fact that from time to time some men in work will be thrown out of it and others idle absorbed again into industry. It is from what might be called this constant reserve of idle labor that recruits for new industries are drawn. By a “constant ” reserve we do not mean that the same individuals must be eon-

staidly out of work, hut .simply Hint hv tliw ops and downs incidental to industry some must always he found who arc tcinporarily out of work. The problem is to reduce that -number to Iho point consistent with industrial progress. Those who originally set forth the scheme for insurance against temporary periods of unemployment in Britain argued at: the time —and the argument seemed to he perfectly sound —that the workman ought to have some assurance of protection against threatened starvation due to no fault of his own hut to I he ordinary variations of the law of supply and demand. It was held at the time that the worker would he inclined to take a greater interest in his job if he wore set free from the anxieties incidental to the risk of losing it, and that insurance against unemployment would go a long way towards abolishing the mistaken and harmful policy of “on’ canny.” In general, it was felt that output, would increase, that competitive power would he strengthened and that the expansion of industry would ho such that unemployment would approach as closely to a final solution as is humanly possible. But as a matte: of fact none of those things happen eil. The theories of what would or should happen were completely overturned by the facts of what did happen. There was more of the ‘‘ea’ canny” spirit, and not less; there was more agitation, and there was more unemployment. The net result has been that hitherto independent men have run grave risks of becoming pauperised, industrial olheioney has boon weakened and the whole problem made, more vexing than ever. U is contended by the writer referred to that in the days when workman feared the total loss of his income that would follow as the result of his being tin-own out of ouiploymeTil, ho was more inclined, having more inducement, I" please his employer and retain his post. lamployers had tlierefm e a (Tea I or sense of security and gut a bigger i el uni for their investments in labor, so I hat they were able more successfully to compete in the markets affecting their own business. The commodities in these markets were cheaper, and the genera! cost of living affected for good. Having lost bis job, the employee of those preinsurance days had to run up credit: bills, or borrow, and lmd every incentive to get back into employment, as ijuickly as possible so as to got square a°‘ain.* But to-day in Britain there are vast numbers of workers who own no allegiance either to the employer or the State; there are those who have never learned to work steadily, those who do not wish to work, being able t 0 rub along somehow on their allowances. those who have lost what skill they had, and many who have so far lost* their spirit of independence that they regard public, relief as their rightful due. The spirit of the workman in employment is also affected, since lie does not need to care so much ns before whether his employer is pleased or not, whether his work is well done or not, or whether he loses his work or not. This has its roper-

mission upon the competitive power of the industry concerned. Bo it can be seen that after all that has been done or said, the problem at Home is more acute than ever, and remains in its original and fundamental terms. These terms may be expressed bv saying that the real unemployment problem is how best lo expand industry so that it can absorb as many workers as possible, and how to deal with those who are out of work in such a .manner that they will remain efficient as workers and be induced to show a constant eagerness to return to the ranks of industry. One feels that it is this matter of extending industry and encouraging it that ought to claim the primary attention of the Government rather than the secondary matter of applying palliatives by way of relief to those who are suffering from the general decline of industrial enterprise. No one is going to assume in a tight-hearted manner that this gigantic puzzle which has baffled the best brains of the world is going to be worked out in a day; but in our own case in New Zealand it can do us no barm to learn from the mistakes of others. The reports of the committee set up here to investigate the whole idlest ion will yet require a good deal of study; but in the meantime it may be questioned if anything in the nature of the Old Country’s policy in reference to unemployment will be of any benelit to the Dominion.