UNEMPLOYMENT

Waipa Post, Volume 45, Issue 3250, 3 November 1932, Page 5

UNEMPLOYMENT

TACKLING THE PROBLEMS

WHAT THE BOARD HAS DONE

(By Telegraph. Press Association.) WELLINGTON, Wednesday

The following paper was read yesterday by Mr Walter Bromley, a member of the Unemployment Boaxxi, before the Wellington Rotary Club:—

I have been invited as a member of the Unemployment Board to address you on the building industry and its relationship to the unemployment problem. My remarks will cover first the extent of the collapse in the industry and its' effects on the general question of unemployment, and then the stimulating effect of the Unemployment Board’s scheme No. 10 towards recovery of the industry. In such a brief survey as is possible in a talk limited to twenty minutes it is impossible to review all the known factors contributing: to the abnormally low waste to which the building industry has fallen by May of this year, neither is it possible in a short paper to examine all the difficulties to be encountered when you attempt to apply artificial respiration as it were, to an industry which has been down for the third time in the dark waters of economic depression. First let me examine with you the importance of the building industry in the economic life of the country in which we live. And what appears of most importance is the fact that, apart from our primary industry, our building industry, in normal times, is the greatest employer of labour. In considering the unemployment position in the Dominion at the early part of the year it seemed to us that no single factor was as striking as the almost complete collapse of building operations and the consequent unemployment of thousands of labourers and tradesman dependent on the industry for a living. Although it is fairly common knowledge that building was practically at a standstill immediately prior to the operation of -the buiding subsidy scheme introduced by the Unemployment Board in June last, there is a feeling in my mind that even the public, are not fully aware of the extent of the falling-off in building activity. We are helped in gauging the falling-off in building by the fact that for several years past our statistical office has been collecting data regarding the number and value of building permits issued by cities, boroughs and town districts, and from the information they have collected we qre enabled to get a clear picture of the industry we are reviewing. I It is not my intention to read you a mass of figures which you can get in detail from the Government Year Book. I will confine myself to one or two comments on the figures to be found there. Taking the value of building permits issued for the last ten years, 1922 to 1932,. we get a variation ranging from just over £ll,000,000 down to £2,750,000. If we take an index number of 100 representing the value of building permits granted in 1922 the number rose to 209 in 1927 and fell to 52 for the year ending March last. Building activity reached its maximum both in value and in volume in the year ending March', 1927, when an increase of 100 per cent, in value and of 149 per cent, in volume was recorded as compared with the corresponding figures for 1921-22. For the last year ending March 31st of this year the value of building permits granted fell to the unprecedented total of £2,728,000 or 52 per cent, in value and. 68 per cent, in volume of the 1921-22 total. Compared with 1926-27 (when the maximum was reached) the decreases for last year were 75 per cent, in value and 73 per cent in volume. Even those figures dealing with the annual fluctuation, arresting though they are. do not wholly reveal the position that had been reached by May of this year, when the figures for the month were the lowest recorded for any month since the collection of statistics began. I have said enough to illustrate clearly the complete, collapse of this important industry. What I propose now is to illustrate the effect of this collapse on the unemployment. problem. In this respect I would point out that the numbers of male wage-earners employed in building and allied trades at the last census date (April 1926) are of interest. Industry Male wage earners employed. Construction and repair of buildings. 8,057 Bush sawmilling 8,057 Joinery and sash and door factories 1,482 Manufacture of furniture fittings etc. 4,894 > 37,248 lit will be observed that no fewer than 22,815 male wage earners were actively engaged in the actual building operations at the census date, while 14,453 more were engaged in industries largely dependent on building activity for their support. In addition other industries (e.g. transport) are considerably affected by the volume of building activity. When we realise that the value of building activity represented by permits issued in the larger towns during the five months ended May of this year averaged \only 17 per cent, of the corresponding month’s value during 192 f» the effect of this decline on employment in the building and allied trades is only too evident. If the decline among -wage earners employed in construction and repair of buildings were proportional to the decline in the value of permits issued it means that less than 4,000 male wage eaimers were employed in actual construction and repair work during last May, as compared with. 22.813 at the census data. Recognising this aspect of the problem the Unemployment Board introduced the subsidy scheme,. now known as No. 10 scheme. It is an attempt to restore confidence in those persons and companies who are, or were, withholding from capital expenditure in the form of new buildings and repairs to existing buildings, and in the light of the success achieved In that direction you are

asked to judge the scheme. I am not claiming perfection for the scheme. If there were no abuses of this scheme, or of any other of the Board’s schemes for that matter, it would indicate that we were living amidst a perfect society and not necessarily that we had evolved perfect schemes. I think 'I can only say with some confidence Jhowever, that the alleged abuses are more imaginary than real. The general run of pdople are not so bad as they are sometimes made out to be.

I mentioned earlier that the difficulties to be overcome when applying means of assistance to an _ industry organised on economic lines are very many indeed. That this scheme is presenting So few difficulties is due to a large extent to the helpful suggestions and criticisms made by representatives of the employers and the employees. Criticism of our schemes can be helpful. It is a melancholy fact, howver, that most of the criticism offered is not even intended to be helpful, but is engendered by that preverse attitude fostered in the name of principle, in short, a desire to be ‘agin the Government.’ After three months what has been the effect of this scheme? Has the Unemployment Board any cause for satisfaction? Once again I propose to relate the facts and to leave the judgment with you. If the value of building permits for the month prior to the scheme coming, into operation were the lowest ever reached it is some satisfaction to relate that the figures for August were the highest for twelve months and those for September were an improvement on the August figures. The value of buildpermits it must be admitted may be expended on repairs and alterations to existing buildings for which permits are not required. What •is of importance in determining how far the scheme has succeeded, and reliable as well, is the data collected from the applications made for subsidy. From that source we are able to prove a very substantial revival in building activity. Up to the end ■of October, yesterday, the number of applications approved total 2774 involving a total expenditure of £751,275. If there were no buildings in progress, or in prospect other than those upon which assistance has been approved, and I can assure you that is far from being the position, it would represent an increase of 100 per cent over the three months ending May 31st, the three months immediately prior to the scheme commencing to operate. The number of workers engaged up to the end of September on these works was 2089. The number estimated to be employed on these works before completion is 7092. If I take the former number of workers engaged up to the end of September on these works—2oß9 —I am in a position to say definitely that four married men were engaged to each single man and that 73 per cent of these married men had been taken from our Scheme No. 5, where, through force of circumstances, they were engaged in work to which they were not accustomed and in many cases not fitted and have been placed in employment they were specially trained to carry out and at a rate of pay that will enable them to rehabilitate themselves to some extent. The scheme is only intended to operate for two more months. At the commencement of this paper I referred to the scheme as the application of artificial respiration to an industry having been down for the third time in the sea of depression. If by the end of the year the industry is still far from normal at least it is showing signs of revival and must at that stage be left to the care of its captains. Before concluding the paper, it is timely to remind you that the effect of this revival cannot be confined to the men actually engaged in building operations. Of the three-quarter million the value of the buildings approved for subsidy during the past three months no less than 78 per cent represents labour costs in New Zealand. At another meeting in the early stages of the scheme I estimated that 68 per cent of the capital value would -represent total labour costs. A more thorough examination proves the figure to be 78 per cent. This means more work for the saxvmills, our cement works transport and other branches, and although the full effect will not yet be apparent, it must in due course reveal itself. That, gentlemen, is the story of the Unemployment Board’s attempt to rehabilitate an important industry. I must ask you not to take it for granted that the Board’s efforts to cure as well as relieve unemployment, have been confined to the building industry. Our primary industries, gold mining, coal mining, flax and other industries have been assisted. Yet, in spite of all our efforts,, the continued low prices for our products is proving too great a handicap to allow of anything in the nature of spectacular results. Unemployment is admitted as one of the world’s major problems. The rulers in almost every known civilised country are grappling with the problem. Up to the present the difficulties in providing palliatives even have proved great enough to wreck government after government, quite irrespective of the political brand. Our dealing with the problem leaves much to be. desired although judged by comparison with measures adopted in other countries I think the comparison would be favourable to us. Judged from the standpoint of the critics, the Government is unfortunate in so far that the members of the Unemployment Board are the only persons who do not seem to know of a certain cure for unemployment