AUSTRALIA'S WEALTH

Taranaki Daily News, 22 August 1930, Page 10

AUSTRALIA'S WEALTH

THE NATIONAL INCOME. Back in 1907 the “Engineering News” of the United States of America investigated the question of whether a rapid increase in wealth was a threat against the welfare of the people as a whole. Basing its computation on the Census Bureau’s estimate of the total value of all property in 1904, the American publication arrived at an estimate that Labour's share in the productive industry of the United States was three times the reward of capital. In this article a comparison in regard to Australia is worked out on similar lines, says the Melbourne Age. A statistical estimate of the value of the national wealth in Australia was calculated officially in. 1923 at £3,150,000,000, made up of private wealth £2.425,000,000 and public wealth £725,000,000. Professor Benham, of Sydney, has estimated the latest'available national wealth figures, for the year 1925, as £3.300,000,000, the statistical figures in that year, for private wealth only, being £2,836,902,000. , These figures by themselves mean nothing. But a useful lesson might be learnt by a reduction from them of an approximate estimate bf the total income which capital, or accumulated' wealth received, and a comparison between that income' and the total earnings of • labour. ' . It is difficult to arrive at a fair aver--age rate of income produced by all wealth. Real estate first, and State railways second, constitute the bulk ofthe property of Australia. The value of land, houses and permanent improvements alone in 1925 was estimated at £1,784,673,000. But assuming interest at the rate of 5 per cent., £3,300,000,000 of invested capital would yield an annual return of £165,000,000.

The population of the Commonwealth in 1925' was' 5,092,684. In America it is estimated that there exists one worker to every 3| persons in the Republic, and the percentage is about the came in Australia. The Commonwealth Census of 1921, when the population was 5,435,734, classified 139,623 employers, 342,321 persons “working on own account,” and 1,502,893 receiving wages or salary, in addition to 159,080 unemployed. It will be assumed that in 1925 the number of persons here receiving wages or salary was £1,712,024. What were the average annual earnings of those 1,712,024 workers? The number of railway employees in the Commonwealth during 1925 was 112,938, the total salaries and wages paid to them (by the States and Commonwealth, not by companies as under the privately-owned system of America) .being £26,018,363. This gives an average in wages of £230 7s Id per annum. (The average iri 1927-28 was £260 5s Id). Statistics' of manufacturing industries show that in the year 1925-26 the number of persons employed in Australia was 4-50,920, comprising 340,082 males and 110,838 females, to whom salaries -and wages were' paid amounting to £75,357,263.. This gives an annual average in wages of £l6O-14s 2d. Similar staistics are not available for other occupations. It will be agreed, however, that those persons engaged in professional occupations receive a higher average, while it is commonly believed that the large army, engaged in agriculture receives a lower average. Certainly the average of those persons engaged in domstic and personal service is considerably less. .' Based on the figures of 1905 the American calculation fixed £9O per annum as a reasonable estimate of the earnings of the average worker, railway employees averaging £l2l per annum and those engaged in manufacturing industries £lO6 per annum. In . Australia . the weighted average of the basic wage in six capitals, as on August I, 1929, was £l5 10s 6d, while it was estimated that .in 1928 the adult Australian workman's wages was £5 0s 5d weekly. On the figures for 1925 £l5O per annum seems reasonable, as the. earnings of the average.worker in the Commonwealth. Alultiplying tlie total number of wage and salary earners by the average earnings, it is found that compensation paid to labour in a year amounted to £256,803,600. In the same year invested capital, public and private, yielded £165,000,000. These figures accepted, then it will be seen that while labour's share of productive industry amounts to about 60 per cent., the reward of capital amounts to 40 per cent. A comparison between the earnings of capital and the earnings of labour, however, is misleading to the extent that a considerable portion of the national wealth is the property of the wage and salary earners. The accumulations of large sums of money by the wealthy bulk large in the public mind; but they are relatively small as compared with the accumulated savings of tlie people of moderate means. Our interest in the State railways as assets, and the fact that most people own houses in which they live, emphasises this point. D/pcsits in the savings banks of Australia in 1925 amounted to £183,040,140, while the assets of life assurance companies totalled £307,656,787.