DEPRESSION IN TRADE

Waikato Times, Volume 93, Issue 14536, 7 December 1920, Page 9

DEPRESSION IN TRADE

GLOOMY WINTER OUTLOOK. (From a Correspondent). LONDON, October 14. 'from all parts of the country come •eporls of trade depression. Thouands of workers have already been lischarged, and the outlook for the winter is extremely grave. The main causes for lack of employment are undoubtedly that manu'aoturers are afraid to quote definite . lxed prices for goods, because at any noment Hie workers may demand a 'ui'ther increase of wages, and Coninental buyers are refusing to place rders without being certain what they vill be charged. Secondly, Hie manuacturers decline to guarantee delivery if goods by. specified dates, because lew strikes may render this impossible. ' n short, no one dare book an order lecause he can never tell what the roods will cost him, or when he can tromise delivery. In none of the naional industries is unemployment so prevalent as in the transport trades. ind, as Mr Ben Tillett,-M.P., says, "a slump' in trade transport always indicates a general 'sljimp.' " In the Lonlon area, as the reports indicate, trade s extremely bad, and the grisly spectre of hunger hover's more porten- ■ ously over the East End than for many years past. The same story comes from most of the manufacturing centres —the employers have no faith in the future, and dare not risk personal disaster. Only at the Beginning. Mr Peter Rylands, president of the ! Federation of British Industries, who is in the very best position to specify the causes of this serious slate of affairs, considers that we are only at the beginning of a very trying period. "The trouble commenced with increasing production cost during the war period," he says, "when wages rose owing to scarcity of labour, and Government action at the same time Government subsidies artificially reduced the cost of living. The effort of this was masked during the war by the fact that industry was largely working for the Government, and foreign com- _ -pstiUefl— w-as—iH'ttC+h'ttrry —irairnixijTtnTtr At the same time, however, the Government was financing the war partly by taxation and loans, which depleted the only sources from which capital could be renewed, and partly by inflation of credit and currency, which depreciated the purchasing power of the money unit, and increased the prices of all but subsidised commodities. Immediately after the war inflation continued, and the abnormal demand of a starving world for commodities kept prices up and trade active 1 . Now foreign competition is reviving, Hie subsidies are disappearing, ;md Hie Government is attempting to reduce the inflation while still maintoning its high rate of expenditure, and higher taxation. At the same time, Labour, accustomed .to.a scale of living rendered possible by the artificial war conditions, and having achieved shorter hours, expects to maintain these advantages. Industry is therefore faced with a shortage of capital, Labour costs at least as high as during the war period, and the competition* of countries witli lower labour costs, and in most eases lower taxation, in markets which will no longer pay the abnormally inflated prices. Standard of Living Too High. "It is the beginning of the recovery of foreign manufacturers witli a lower scale of costs, and lower standard o-f living that has cut short this abnormal period of British trade. Our only prospect of holding our own is to increase production, with lower production costs, and curtailment of the spending power of the general public while supplies are still limited." As the whole of the industries are legally bound to a maximum 47-hour week, Mr Rylans points out, there is no avenue for increased production. "The trade of this country," he adds, "cannot be maintained if the present false relations are fostered. As a nation we are considerably poorer than in 1914, but the standard of living of the working class has mounted very considerably; their spending has increased, while their productivity has declined. As a nation, for many years we have livtd beyond our income, and are paying current expenses by resort to money-lenders. The only way we can replace our exhausted capital, or even avoid defaulting on the immense in-terest-payments due, is by working our resources to the maximum capacity, and, as regards the population in general, by cutting our coat to the cloth we have —by lowering our standard of living, and our spending. But now —when the Government is abandoning subsidies and restricting credit —Labour is even still pressing for further increases in money wages." improved Factory Conditions. The anuual report of the Chief Inspector of Factories and Workshops goes to show that the shortening of the hours has had a beneficial effect on the operatives, perhaps more than any other recent improvement in industrial ; conditions. Better time-keeping has been the result of discontinuing work before breakfast. There is also less absence for sickness and other reasons. Factory conditions arc clearly becoming more human. "An effort has been made in certain textile factories in Scotland," says the report, "to make the rooms look more cheerful by painting the ironwork in bright colours; and one firm in particular is mentioned where, ill a large mule spinning room, the iron supporting columns had, oa tiie suggestion of the Welfare Supervisor, been painted in brightly contrasting colours with excellent effect. The usual drab appearance of such a room was completely changed; the general impression was one of cheerfulness, and brought with it the reflection how much a little touch of bright colour introduced in this way would do to enliven the gloomy interior of many of the older mills."