This curtailment of production, although certainly much smaller than the corresponding figure for Germany, nevertheless implies an immense contraction in private business, when it is remembered what a large amount of work is being done in this country for the British and Allied Governments. It is impossible to say, with the information at present available, how much of the 540 millions sterling a year, that is being spent by the British Government in connexion with the war, is assignable to industrial contracts. Some of the money that Mr Lloyd George has bad to find is going in the form of loans to foreign and Colonial Governments, some proportion of which is spent by these Governments in Great Britain for material of various kinds. Of the direct expenditure on our own requirements a considerable proportion is being spent in France; a very large sum is in respect of soldiers' pay and separation allowances; and the purchase of sugar and other important raw materials accounts for considerable sums, while payments to shippers and British railway companies are also important items. In the absence of any official statement of expenditure it is impossible to give any sort of estimate of the value of contracts placed in this country on behalf of the British Government. The figure, however, undoubtedly runs into hundreds of millions, only a comparatively small proportion of which is paid to foreign countries in respect of raw material imported from abroad. Mr Flux recently estimated, in the Census of Production, that the value of the products turned out by our factories, workshops and mines, amounted in 1907 to 1,250,000,0001. The value of Government contracts placed cannot be less than 10 per cent. of this capacity; and, if account is taken of the work done for the Allies, the figure may be nearer 20 per cent. The figures of employment show that our producing capacity has been curtailed since the war by some 13 per cent. ; and, if a further 10 to 20 per cent. is at work on Government contracts, etc., our normal production for private trade would appear to have shrunk by from 23 to 33 per cent.-representing an output of

Christmas, the national output-calculated in the same manner—was only 9.2 per cent. less than before the war. This improvement would, however, seem to be due to the normal Christmas pressure and to Government contracts rather than to a general recovery in ordinary private trade.

300 to 400 millions sterling. So sweeping a change is without precedent in our modern industrial history.

On the other hand, agriculture has not been diverted to any large extent from its normal channels, except that a rather larger area than usual is being sown with wheat, and in certain other directions efforts are being made to increase the supplies of home-grown food. Labour has been withdrawn, to some extent, from rural districts for the forces; but it can well be spared in the winter months, and especially in a rather open winter like the present, when farmers have been able to choose their time for various operations. It remains to be seen whether output will be affected by lack of labour in the spring and summer; but agriculturalists are already anticipating serious difficulty in this respect.

As regards transport there has been at least as much work as usual to be done both by sea and land; and while railways, trams and omnibus companies have been under the necessity of taking on men to fill the places of those who have enlisted, the situation at sea has resulted in a serious shortage of tonnage, especially in European and American waters. In the business of retail distribution there has been a shrinkage in the amount of work to be done, proportionate to the considerable reduction of the turnover of shopkeepers. But a falling off of retail business does not lead to the discharge of employees to the same extent as a similar reduction in manufacturing output would do, since the former is so much less concentrated than the latter.

In the legal profession, and in those occupations which cater for amusement, 'output' has been reduced at least as much as in industry; and there have been no compensations in the form of Government contracts. In education and in the medical profession 'output' is as great or greater than usual.

This being in outline the situation as regards the productive activities of the nation, thc question of employment needs consideration from three points of view : (1) The problems raised by the existence of a surplus or shortage of labour in various occupations at the present moment or in the immediate future ; (2) The economic effects of the possible further withdrawal of very large numbers of recruits; and (3) The situation that is likely to arise at the end of the war.

As regards the first point, it has been evident for some time that the dislocation due to the war has been 80 completely balanced by the withdrawal of 1} million civilians for military or naval service that there is no net balance of unemployment amongst males when all trades are considered together; for, although some industries have experienced a slump, others have had to take on men and in many cases work overtime. In some of the former trades earnings and profits are sadly diminished, expenditure has had to be curtailed, and, if conditions remain unchanged, the situation may involve some appreciable amount of distress, especially among small employers, and among elderly employees who are too old to enlist or change their employment.

The effect of enlistment on employment has not on the whole been quite what might have been expected. In some of the war-contract trades the increase in demand occurred so soon after the outbreak of the war and was so general that the enlistment percentage has never risen above a very low level. For example, in October, when the recruiting percentage in all industries was 101 per cent., the figure for the Boot and Shoe and Hosiery trades was only 6.7 per cent., while the percentage in Wool and Worsted was only 4:8 per cent. On the other hand, the Stock Exchange, which suffered from an immediate cessation of business, contributed nearly 30 per cent. of its employees to the forces in one form or another. Apart from these cases, however, there is no general evidence that booming trades have contributed small proportions and depressed trades large proportions to His Majesty's forces. Local characteristics and influences of various kinds, indeed, appear to have been stronger than economic considerations in causing differences in the proportion of enlistment. In Banking, which has been by no means depressed since the outbreak of the war, 20 per cent. of the employees have gone to the forces; while in commerce generally the proportion is as high as 13 per cent.

On the other hand, Quarries (largely a Welsh industry), though suffering some restriction in business, only show 77 per cent. of enlistment. The Tinplate Vol. 222.—No. 442.



trade (another Welsh industry) shows 7.8 per cent., the Cotton trade 7 per cent., while in the Furniture trade, which shows a gross contraction of employment amounting to no less than 21} per cent., in addition to a considerable amount of short time among those who are still employed, less than 11 per cent. have enlisted. Practically all other trades, whether in a state of prosperity or depression, show a percentage of enlistment of between 10 and 12 per cent. We may, in fact, infer from the figures that the question of earnings and employment has been a comparatively minor influence in inducing men to enlist, and that, except in a few special cases, the response to the first call to arms has been remarkably uniform in all occupations. At any rate, there are no enormous variations in enlistment comparable to the very considerable differences in the condition of various trades. Hence, enlistment has not in itself afforded anything like an automatic corrective of the unequal incidence of the industrial dislocation. Thus, while building, cotton, furniture, brick, stone and cement making, the tin-plate and cycle and carriage-building trades showed a surplus of unemployed labour after allowing for enlistment, at the middle of October, the chemical trades, hosiery, grain milling, food preparation, leather, shipbuilding, and iron and steel trades have had to take on men to replace those who have enlisted.

Under these conditions it is evident that the case of the depressed industries could be met in several ways: (a) by adapting plant and labour to those employments in which increased output is required during the war; (6) by taking steps, either by private co-operation or by Government action, to stimulate the markets served by such industries; (c) by providing Government work; and (d) by attracting an especially large proportion of recruits from the depressed trades.

As regards (a), the transference of labour and machinery cannot very well be carried out in specialised occupations, such as the cotton trade, though a few very exceptional cases have been reported of certain mills in Lancashire being adapted to the production of khaki. In the clothing trade, on the other hand, thousands of persons formerly employed in bespoke tailoring are now doing wholesale work for Government contractors. These workpeople do not always appreciate the change, as they frequently earn less and are not very good at their new jobs. Many have, in fact, fallen a grade in industrial 'status.' On the other hand, for many East London firms, Government work is a higher class trade than their usual cheap ready-made output; and several cases have occurred of employers who have installed machinery in their works for the first time. In such ways as this, the changes of the war may have permanent effects. One of the most striking examples of transference is the boot and shoe trade, in which makers of female boots in Leicester and elsewhere have adapted their machinery for heavy army boots. Among other instances may be mentioned the watchmakers, who have been employed in making mechanism in connexion with small arms and ammunition. On the whole the lesson of the war in this connexion is that labour has proved itself considerably more adaptable than most observers had anticipated, and more capable of transference to new uses than plant and machinery. Hence the net displacement shown in the Government report in certain trades may quite properly, though to an unknown extent, be cancelled against the replacement of hands in the booming trades.

Such transferences, though helping to solve the problem of employment, afford small consolation to employers and those who have invested their capital in depressed industries. They, however, make less urgent the need of finding new markets as an outlet for the products of depressed trades. At the outset of the war a great deal of public attention was directed to this question in cases where the Continental market was of importance, or in trades making for home consumption, where the market was curtailed by economy on the part of consumers. The former turned their attention farther afield in the hope of capturing German trade-an operation which thus assumed importance not only as a means of harming the enemy, but also for its effect in keeping our factories occupied. It has, however, to be remembered, that the replacement of German goods for the most part involves a modification of plant and machinery and the production of goods somewhat different from those our producers are accustomed to make. For many

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