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SuppUmenl to

Clje Annals; of

THE AMERICAN ACADEMY OF POUTICAL
AND SOCIAL SCIENCE
^^•v, 1916




Steadying
Employment

With a Section Devoted to
Some Facts on Unemployment
in Philadelphia



PHILADELPHIA
The American Academy of Political and Social Science



THE AMERICAN ACADEMY OF POLITICAL
AND SOCIAL SCIENCE

Origin and Purpose. The Academy was organized December
14, 1889, to provide a national forum for the discussion of political and
social questions. The Academy does not take sides upon controverted
questions, but seeks to secure and present reliable information to assist
the public in forming an intelligent and accurate opinion.

Publications. The Academy publishes annually six issues of
its "Annals" dealing with the six most prominent current social and
political problems. Each publication contains from twenty to twenty-
five papers upon the same general subject. The larget number of the
papers published are solicited by the Academy; they are serious dis-
cussions, not doctrinaire expressions of opinion.

Meetings. The Academy holds five scientific sessions each year
during the winter months, and it also has an annual meeting in April,
extending over two full days and including six sessions. The papers
of permanent value presented at the meetings are included in the Acad-
emy publications.

Membership. The subscription price of The Annals of the
American Academy of Political and Social Science is $6.00 per year.
Single copies are sold at $1.00 each. The Annals are sent to all
members of the Academy, $4.00 (or more) of the annual membership
fee of $5.00 being for a subscription to the publication. Membership
in the Academy may be secured by applying to the Secretary, 36th
Street and Woodland Avenue, Philadelphia. The membership fee is
$5.00; life membership fee, $100. Members not only receive all the
regular publications of the Academy, but are also invited to attend and
take part in the scientific meetings, and have the privilege of applying
to the Editorial Council for information upon current political and
social question.



STEADYING EMPLOYMENT

WITH A SECTION DEVOTED TO SOME FACTS
ON UNEMPLOYMENT IN PHILADELPHIA



The investigation forming the basis for this study was carried on in the
Department of Public Works of the City of Philadelphia



JOSEPH H. WILLITS, A.M.,

Instructor in- I.vdcstry, Wiiautox School,
University of Pennsylvania




PHILADELPHIA

The American Academy of Political and Social Science
1916




Copyright, 1916, by

American Academy of Political and Social Science

AH rights reserved



EUROPEAN AGENTS

England: P. S. King & Son, Ltd., 2 Great Smith St., Westminster, London, S.W.
France: L. Larose, Rue Soufflot, 22, Paris.

Germany: Mayer & Miiller, 2 Prinz Louis Ferdinandstrasse, Berlin, N. W.
Italy: Giornale Degli Economisti, via Monte Savello, Palazzo Orsini, Rome.
Spain: E. Dossat, 9 Plaza de Santa Ana, Madrid.



Public officials and committees without number havebeencom-
missioned to study the abnormalities of unemploj'ment. But not
until 1915, when Morris Llewelljn Cooke, then Director of the
Department of Public Works of the City of Philadelphia, assigned
to Mr. Joseph H. Willits this duty, had there been, at public ini-
tiative and with the facilities of a public office, a thoroughgoing
study of the normalities of employment and the relation of indus-
trial management and industrial policies to unemployment.

]\Ir. Willits' report to Director Cooke was first published in a
small edition by the City of Philadelphia. Because of the limited
number of copies originally issued, because this supply is now ex-
hausted, and because of the valuable nature of the study, the
Academy republishes it here in a revised form. It is particularly
appropriate and valuable as a supplement to the larger volume on
"Personnel and Employment Problems in Industrial Management."

Clyde Lyndon King,

Editor.



m



1205281



FOREWORD



In December, 1914, a meeting of business men was called by
Mayor Blankenburg with a view to seeing what steps the Phila-
delphia community should take with regard to its unemployment
problem. This meeting was attended by Samuel Rea, President
of the Pennsylvania Railroad; J. Howell Cummings, President
of The John B. Stetson Company; J. W. Van Dyke, President of
the Atlantic Refining Company; Franklin Brewer, General Man-
ager of Wanamaker's; Louis J. Kolb, of the Kolb Bakery Com-
pany; Joseph Steele, of Wm. Steele & Sons Co., builders; Louis
Bloc, of the Ford Motor Company, and several members of the
Mayor's cabinet.

The number of men and women out of employment had at
that date not reached so high a total as was experienced during
the following January and February. The meeting was called to-
gether with the thought of taking all possible steps which might
act to minimize the ultimate amount of unemployment. A num-
ber of suggestions as to possible lines of action were made. It
was the concensus of opinion that the agencies then at work would
give the maximum of relief to the immediate situation. The con-
ference felt that the municipality should rather acquaint itself
with the problem in its broader aspects, to find out what other
municipalities were doing in this matter, and to make a general
study of the problem of unemployment such as would suggest
what steps might be taken to minimize it in the future in Phila-
delphia. As there was a vacancy then existing in the position of
General Inspector, Office of the Director, Department of Public
Works, and as this position was exempt under civil service rules,
it was suggested that this vacancy be filled by the appointment of a
student of economics qualified to carry on an inquiry into each of
the phases of the general unemployment problem.

This suggestion having received the unanimous approval of
the conference, and after several weeks of search for the right man,
announcement was made of the appointment of Joseph H. Willits,
4519 Sansom Street, Instructor in Industry in the Wharton School



Foreword V

of Finance and Commerce of the University of Pennsylvania. The
selection of Mr. Willits was approved by his associates in the faculty
of the Wharton School and he was given an eight months' leave of
absence in order to give his undivided attention to the work.

In this report it will be noted that an effort has been made
to get down to the basic causes of unemployment and to describe
a standard, which it is believed will, during the next generation,
be forced upon any industrial community which is to compete in
any large and successful waj- with sister communities at home
and abroad.

Grateful acknowledgment is hereby made to those employers
and employes (as well as others) whose courtesy and cooperation
made possible the gathering together of the information which
makes up this report. The almost unanimous desire of employers
not to have their names mentioned in connection with information
furnished makes it unfortunately necessary that cases shall be
referred to anonymously.

Signed,

Morris L. Cooke,

Director.



INTRODUCTORY NOTE

At the outset of this report attention is called to the difference
between the unemployed person who can and will work, if he has
the chance; and the unemployed person who is unable to work
through physical incapacity, or who would "starve to death along-
side of a job before he would work at it." The larger amount of
advertising that these, "the unemployables," receive, blinds many
citizens to the very existence of the first class. From the point of
view of immediate community welfare, the problem of the first class
is the more important, for it is the degenerating effect of this form of
unemployment that drives many self-respecting and capable
workers into the "unemployable" ranks. This report primarily
has reference to the "unemployed." The handling of the second
class is largely, though not altogether, a sociological, not an in-
dustrial problem.

Joseph H. Willits.



VI



TABLE OF CONTENTS

PARTI
Facts of Unemployment
The permanency of unemployment, p. 3; the textile industry, p. 5; lace and lace
curtains, p. 7; carpet, p. 13; cloth industry, p. 18; hosiery, p. 20; the clothing
industry, p. 21; industries manufacturing electric and steam railway equip-
ment and ships, p. 27; the building trades, p. 29; the longshoremen, p. 29;
agricultural labor, p. 31 ; department stores, p. 32; regularity of employment,
p. 33; labor union statements, p. 34; miscellaneous industries, p. 35.

PART II

The Cost of Unemployment
To the employe, p. 37; to the employer, p. 43.

PART III
The Increase of Knowledge about Unemployment
Canvass by Metropolitan Life Insurance Company, p. 48; canvass by State De-
partment of Labor and Industry, p. 48; study on unemployment by Consum-
ers' League, p. 49; courses in unemployment, p. 50.

PART IV

The Management of Employing Concerns in Its Relation to
Unemployment
Obtaining and analyzing the facts in each individual plant, p. 56; incomplete
methods of determining costs, p. 58; maintaining an excessive labor reserve,
p. 59; reduction of the labor turnover, p. 63; better methods of hiring and
discharging help, p. 71; better methods of training help, p. 75; reducing the
fluctuations in employment, p. 76; closer cooperation between the manufac-
turing and selling ends of a concern and the standardization of product, p. 77;
abuses, p. 77; time lost waiting for dye (or other materials), p. 84; lack of
balance between departments, p. 86; stock taking, p. 86; limitation of the
amount an employe is allowed to earn each week, p. 87; frequent changes in
standard daily production policy of factories according to volume of orders in
sight, p. 87; manufacture to stock, p. 88; miscellaneous practices by em-
ployers which lessen or increase the burden of unemployment, p. 88; giving
notice of lay-off, p. 88; dovetailing of trades, p. 88; loans to employes, p. 89;
retaining all of the employes' time at fractional productivity, p. 89; enforcing
needless expense on employes during periods of unemployment, p. 90; part
time employment, p. 90; times of pa3Tnent, p. 91 .

PART V
The Duty of the City Government
Municipal work, p. 92; a municipal employment bureau, p. 95; a municipallodg-
inghouse, p. 101; the duty of the consumer, p. 101.

vii



PART I

FACTS OF UNEMPLOYMENT IN PHILADELPHIA

The most fundamental fact about unemployment in Phil-
adelphia or any other American industrial center is that we know
practically nothing about it. We do not know its extent; whether
it is increasing; in what industries it exists; just what are the dif-
ferent causes that bring about lost time; nor just how unemploy-
ment affects the worker's standard of life, his work and his citizen-
ship, as well as the efficiency of the plant. Not only do we not
know, but we do not have any available information to which we
can turn. So far as definite knowledge is concerned, we are still
"up in the air."

The information collected by the various branches of govern-
ment — national, state and city — is still most vague and general
in character. Every ten years the representatives of the United
States Census come to Philadelphia and collect figures which
show for one year the number of wage-earners engaged each month
in each separate industry.^ The State Department of Labor and
Industry at irregular intervals collects from a large number of
representative firms a statement of the maximum and minimum
number employed during the year, and the dates on which these
high and low points in employment occurred.^ Such information,
while it is a step in the right direction, throws but the barest light
on the extent, nature and causes of unemployment. The only local
investigations have been made by the Consumers' League and by
Phipps Institute. Since these investigations were not primarily
concerned with unemployment, the information furnished on that
subject is necessarily scanty.

The lack of definite knowledge goes deeper than the absence
of public reports, statistics and investigations. A large percent-
age of emplo3'ers have made little analysis of their own unem-
ployment problem. They do not have available for their own or

'■ Twelfth U. S. Census, Vol. 8, Census of Manufactures, pp. 276-281.
^ State Department of Labor and Industry, Bulletin on Variation in Employ-
ment.

[11



2 The Annals of the American Academy

any one's else use data or information which show the extent
and causes of lost time in their plants. Until such information
is coMected, our knowledge of the causes and nature of unemploy-
ment will remain in a very nebulous state. Very few of the labor
unions keep any record showing even the amount, much less the
effect, of unemployment; and only a small proportion of the records
that are kept are thorough enough to be reliable. Moreover,
the unions are apt, as a matter of policy, to exaggerate the amount
of unemployment in good times. Conversely, in bad times, the
fear that the strait of the workers, if known, may be used as a
favorable opportunity to lower wages, leads labor unions to conceal
the real facts. Finally, the figures, even if complete, would present
information for but a small minority of the total body of Philadel-
phia wage-earners.

The value of individual firms and of unions as sources of in-
formation is still further lessened by the hesitancy that many em-
ployers and some labor unions have of giving information to the
public. The unions fear that the employer will find out something
about the organization which he may use to its injury. The
employers, as a rule, fear that information which may be used to
their injury, will reach business competitors, employes, or some regu-
lating government agency. Most of the information for this
report obtained from employers has been secured under the promise
not to mention the name of the firm or the individual. The results
of this "hush" policy make the study of unemployment very much
like a case of "blind man's buff."

Aside from these vague sources, Philadelphia's information
about her own unemployment is confined to what appears in the
newspapers or is passed around by word of mouth. Our igno-
rance is abundantly evidenced whenever the amount of unem-
ployment rises above the normal, by the wide variation shown in
the "estimates" of the number of unemployed that appear from
one source or another. For example, during the winter of 1914-15,
the estimates of the number of unemployed in the city ranged
from 50,000 to 250,000. No one knew the accurate guess from
the inaccurate one; no one could tell the honest guess from the
one that was deliberately faked. We were at sea between the
exaggerations, on the one hand, of the calamity howler, and the
exaggerations, on the other hand, of the conscious preacher of



Steadying Employment 3

optimism. Small wonder that many sincere persons were at a loss
to know to what extent the city was justified in resorting to ultra-
heroic measures.

Not until the end of the summer months — long after the time
for decision was past — was the public as a whole put in possession
of information that gave a more definite idea of*the extent of un-
employment. In order to throw a little more light on the amount
and sources of unemployment during the past winter, the Metro-
politan Life Insurance Company was invited, by Mayor Blanken-
burg, to conduct an unemployment canvass among the families of
those who held policies in the company. The Metropolitan Com-
pany placed the City of Philadelphia under obligations to itself by
agreeing to aid, and lent its splendid organization for the purpose.
The canvass was conducted during the week beginning March 15,
1915, by the agents of the company from each of the company's
branch offices.

In this study the agents of the company called on 78,058
families, in which were 137,244 wage-earners, — about 18 per cent
of all the wage-earners in the city. Of the wage-earners canvassed,
it was found that 10.3 per cent were entirely out of employment
and that 19.7 per cent in addition were working part time.

Canvasses conducted in other cities by the U. S. Department
of Labor Statistics point to the conclusion that the Metropolitan
figures are typical for the entire city. If that be so, there were
in Philadelphia in the middle of March, 1915, approximately 79,000
unemployed and approximately 150,000 part-time wage-earners.
It is significant that the state of affairs as revealed by the above
figures was less severe than in most other large cities where similar
canvasses were conducted.

This canvass disclosed the fact that the textile industries
and building trades furnished the largest number of unemployed;
of whom over one fifth had been out of work over six months. In
less than one fourth of 1 per cent of the cases was unemployment
due to strikes or lock-outs.

The Permanency of Unemployment

The absence of dependable information about our own un-
employment limits discussion, in most instances, to general state-
ments. Datd; can be used chiefly for purposes of illustration



Chart showir\g the'vanation \r\ the
amount of money relief furnished
during seventeen months by Ihe
Philadelphia branch of Ihe society
for Organizing Charity The un-
shaded portion shows that part
of the relief which was furnished
because of impossibility of secur-
ing employment on the part of
those who were able to work -
in the opinion of the Society s
investigators Note the fairly con-
stant sue of the relief furmshed
for causes other than unenn —
ployment and the great irregu-
lar. tu of relief furnished un -
emproyment - alrnost none ai
all in the summer months


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Figure 1



Steadying Employment 5

rather than as comprehensive summaries of an entire situation.
However, this fact stands out: unemployment is permanent, if
not steadily increasing. When we ordinarily assume that men
and women who are willing and able to work are minus a job only
in times of unusual and widespread industrial depression — such
as we experienced during the last winter — we lose sight of the fact
that there is always, even in the most prosperous times, a large
amount of unemployment and part-time employment for these
same workers. In the long run, this permanent or "chronic" un-
employment totals larger than the unemployment of the severe
industrial crises. This is true because the former exists continu-
ously, year after year; whereas a crisis usually occurs only once in a
period of five, eight or ten years. Moreover, from the city's stand-
point, this chronic unemployment is of greater concern because it
arises chiefly from local causes.

The Society for Organizing Charity testifies that there is
always in "good" years and "bad" alike, a considerable number
of applicants for aid who, though willing and able to work, are
forced to seek charitable assistance because of the impossibility
of securing employment. Fig. 1 shows the total amount of re-
lief granted by the Society for Organizing Charity each month
during 1914 and to May, 1915; and, of this total, the percentage
which was due to unemployment. In many cases, undoubtedly,
other causes have contributed to throw these applicants onto charity
after merely a brief period of unemployment; but this fact does
not detract from the evidence shown by the chart of a considerable
amount of unemployment always present.

As a result of over one hundred interviews with the managers
of business houses and social workers, and as a result of studies
made in individual industrial plants, information has been col-
lected which indicates the permanence of unemployment. This
also indicates roughly those industries in the city in which unem-
ployment is normally a large factor.

A. The Textile Industry

Of Philadelphia industries, the textile and clothing manu-
factories show unemployment and part-time employment at their
worst. In the textile industries, the fact which immediately strikes
the observer is that, although very many more workers are unem-



6 The Annals of the American Academy

ployed in industrially "bad" years, yet there is always, even in the
most prosperous years, a very considerable percentage of the
workers who are either entirely idle or working from one to five
days a week. Mr. R. R. P. Bradford, whose sixteen years' ex-
perience in charge of the "Lighthouse" (a social center for the better
class of workers in Kensington) has given him an unusual oppor-
tunity to become acquainted with the facts, says :

We make the mistake of assuming that unemployment is a question solely
of severe bad times. It is true that conditions are worse at such times — they
even approach the destructiveness of a flood or an earthquake. But it is true that
unemployment and part-time employment is a situation that is with us to a very
considerable degree practically without cessation. If it is not one industry, it is
another. If one miU escapes, another is hit. The fear of unemployment and
part-time employment hangs, a permanent pall, over Kensington.

It is worth while to point out two general conditions that
especially contribute to permanent unemployment in the textile
industries. First is the constant shift of demand from one type
of textile fabric to another. The industries that have been built
up to supply products no longer demanded by the market must
gradually die out, or readjust themselves to a new demand. Dur-
ing the decadence of these industries, the numbers of workers that
have been attracted to the industry is greater than can now be
kept busy. These employes hesitate to leave the industry for some
other, probably uncertain and unaccustomed, line: conditions
may improve in their own trade. Moreover, under existing cir-
cumstances in industrial plants, they feel that the skill acquired by
years of work in their own trade will be sacrificed, and many are
too old to risk the change. An excess of workers is, therefore,
characteristic of a declining industry, A long period of part time
and of unemployment, often running into years, results.

A second condition that contributes to irregularity in em-
ployment, and is very much more important now than it was twenty
years ago, is the growing tendency — especially in hosiery, higher
grade carpets and fancy dress goods — to manufacture solely "on
orders." Twenty years ago a manufacturer made carpet or hosiery
or cloth and then went out and sold that carpet, or hosiery or cloth.
Today the order comes in for a particular design, with a certain
kind of yarn or silk and a certain number of threads to the inch, and
the manufacturer makes that particular order. Formerly a manu-



Steadying Employment 7

facturer produced standard makes of his particular line and simply
piled up stock in his warehouse in the off-season. When the orders
began to come in thick and fast, at the proper season, he was ready
for them and simply used up his stock. Today manufacturers
make, as a rule, very little to stock and run chiefly on orders. The
result is that manufacturing has become nearly as irregular as the
orders. When an order comes in, or especially when orders come
in thick and fast at the proper season, there is a period of feverish
activity until they are delivered, and then probably a long period
of total or partial unemployment. A number of workers were in-
terviewed in their homes in a block in which live the more indus-
trious middle class workers in Kensington (hereinafter referred
to as Block "K"). The experience of one man (a warper) in this
block represents a situation prevailing in a large percentage of the
textile factories.

"The second week after I was employed at , I

was called on to work overtime four nights till 9 o'clock at night.
On Saturday of that week, I, with four others, was laid off for lack


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