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Dayton & Montgomery Co

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J U N 1 2 1968

document COLLECTION

AN INTERNAT I

COMPARISON

, G E R M A N Y ,

KINGDOM

UNITED STATES DEPARTMENT OF LABOR, Bureau of Labor Statistics

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D U L.L.L. M IX 1 U O U

1968

A N IN T E R N A T IO N A L 

COMPARiSOiM OF

i

UNIT LABOR COST

IN THE IRON AND STEEL

INDUSTRY, 1964:

U N I T E D .

F R A N C E , GmiXM AM V, 

U N ITE D H i W G D 0 «

U.S. DEPARTMENT OF LABOR, Willard Wirtz, Secretary

Bureau of Labor S ta tis tic s , A rthur M, Ross, C om m issioner

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Preface

The Bureau of Labor Statistics has had an increasing

interest in comparing labor costs per unit of output by industry in different countries as one of the basic factors

determining international tr a d e flows in manufactured

products. The Bureau published an article in the May

1963 Monthly Labor Review describing the technical problems of defining and measuring unit labor cost and has

issued several reports (April 1964 and September 1965

issues of the Monthly Labor Review, and BLS Bulletin

1518, 1966) showing the time trend indexes of unit labor

cost in all manufacturing for industrial countries. The

present bulletin compares, for the first time, the absolute

levels of unit labor cost in the primary iron and steel

industry of the United States and the three largest steel

producing countries of Western Europe in 1964. A study

of unit cost in the Japanese industry and a companion study

of trends in unit labor cost in the iron and steel industry

for the same five countries are in progress.

The steel industry was selected for this first absolute

measurement project because it ranks high among basic

industries in terms of size, public interest, and availability

and comparability of data. United States imports of steel

products and the volume of international trade in steel

products in general have reached record levels in recent

years, resulting in sharpened interest in the findings of

this study. Great interest also attaches to the method of

the present study and to the fact that sufficient data could

be assembled to complete an international comparison at

the industry level.

The bulletin was prepared by David A. Wise and

reviewed by John H. Chandler and William C. Shelton in

the Office of Foreign Labor and Trade.

iii

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Contents

Introduction_______________________________________________________________________________________ 1

General method______________________________________ 2

Definition of unit labor c o s t _______ ________________ ___________________________________________ 2

Labor expenditure _____________________________________ 2

The need for weighting _______________________________________________________________________ 4

Minimum and maximum estimates ___________________ 4

Results _____________________________________________________________________________________________ 5

Unit labor c o s t_________________________________________________________________________________ 5

Hourly labor cost _________________________ 7

Man-hours per unit of output ____________________________________________________________ 9

Summary _______________________________________________________________________________________ 11

Interpretation and qualifications ________________________________________________________________ 11

Labor cost and total cost _____________________________________________________________________ 11

The year 1964 versus other years _____________________________________________ ,____________ 11

Vertical integration ___________________________________________________________________________ 13

Capacity utilization___________________________________________________________________________ 14

Variation in cost by product and enterprise________________________________________________ 14

New p rocesses_________________________________________________________________________________ 14

Quality differences _________________________________ .__________________________________ _______ 16

Other factors __________________________________________________________________________________ 16

The iron and steel industry ______________________________________ 16

Production processes _________________________________________________________________________ 16

Crude steel production _______________________________________________________________________ 16

Definition of the industry _____________________________________________________ - ______________ 18

Methods and data u se d___________________________________________________________________________ 20

Weighting _______________________________________________________________________________________ 20

Quality differences ___________________________________________________________________________ 23

United States _________ 25

France „________________________________________________________________________________________ 26

G erm any____________________________ 28

United Kingdom________________________________________________________________________________ 30

Figures:

1. Comparison of unit labor cost, hourly labor cost, output per man-hour, and

man-hours per ton, iron and steel industry, 1964, United States, France,

Germany, and United Kingdom-------------------------------------------------------------------------------------- viii

2. Principal processes and products of the iron and steel industry____________________ 17

Tables:

1. Items included in labor cost, by country, 1964 _______________________________________

2. Unit labor cost in the iron and steel industries of the United States, France,

Germany (Federal Republic), and the United Kingdom, by worker category,

U .S. industry definition, 1964 ___________ ______________________________________________

3. Hourly labor cost in the iron and steel industries of the United States, France,

Germany (Federal Republic), and the United Kingdom, by worker category,

U.S. industry definition, 1964 _________________________________ 8

4. Output per man-hour and man-hours per ton in the iron and steel industries

of the United States, France, Germany (Federal Republic), and the United

Kingdom, U .S. industry definition, 1964 ---------------------------------------------------------------------- 10

5. Hourly labor cost, output per man-hour and man-hours per ton, and unit

labor cost in the steel industries of the United States, France, Germany

(Federal Republic), and the United Kingdom, wage earners and salaried

employees, U.S. industry definition, 1964 ----------------------------------------------------------------- 12

6. Summary of items which could affect relative unit labor cost figures but which

are not incorporated in the range of estimates ---------------------------------------------------------- 15

Page

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Contents— Continued

T abl e s— C ont inu ed

7. Crude steel production and percent distribution by manufacturing process in the

iron and steel industries of the United States, France, Germany, and the

United Kingdom, 1964 and 1966 ______________________________________________________

8. United States 1961 relative man-hour weights, Iron and steel industry,

by product and grade of ste e l________________________________________________________

Appendix A. Mathematical explanation of method _________________________________________

Appendix B:

Tables—

B -l.

B -2.

B -3.

B -4.

B -5.

B -6.

B -7.

B -8.

B -9.

B- 10.

B - l l .

B- 12.

B- 13.

B- 14.

B- 15.

B- 16.

B- 17.

B- 18.

B- 19.

BLS 1961 relative man-hour weights converted to relative cumulative

weights, iron and steel industry ________________________________________________

Deflation of relative cumulative weights from table B -l, using U. S.

United States. Estimate of supplementary benefits for salaried employees,

iron and steel industry, 1964____________________________________________________

United States. Employment cost for wage earners and salaried

employees, iron and steel industry, 1964 ______________________________________

United States. Total hours worked and average hourly labor cost, iron

and steel industry, 1964 _________________________________________________________

United States. Calculation of unit labor cost for wage earners and

salaried employees, iron and steel industry, 1964 ___________________________

United States. Man-hours per ton and output per 1, 000 man-hours,

iron and steel industry, 1964 ___________________________________________________

France. Estimate of minimum and maximum weighted output, iron

and steel industry, U. S. industry definition, 1964 ___________________________

France. Employment cost for wage earners and salaried employees,

ECSC industry definition, iron and steel industry, 1964 _____________________

France. Estimates of employment cost for wage earners and salaried

employees to manufacture products not included in the ECSC iron and

steel industry but included in the U. S. industry, 1964 ____________ __________

France. Estimates of employment cost for wage earners and salaried

employees, U. S. industry definition, iron and steel industry, 1964 _______

France. Estimates of total hours worked, ECSC industry definition

and U .S. industry definition, iron and steel industry, 1964 _________________

France. Estimates of average hourly labor cost for wage earners and

salaried employees, U .S. industry definition, iron and steel industry,

France. Calculation of unit labor cost for wage earners and salaried

employees, iron and steel industry, 1964 _____________________________________

France. Man-hours per ton and output per 1, 000 man-hours, iron and

Germany (Federal Republic). Estimate of minimum and maximum weighted

output, iron and steel industry, U .S. industry definition, 1964 ____________

Germany (Federal Republic). Estimates of employment cost for wage

earners and salaried employees, U.S. industry definition, iron and

steel industry, 1964 ______________________________________________________________

Germany (Federal Republic). Estimates of total hours worked, U .S.

industry definition, iron and steel industry, 1964 ____________________________

Germany (Federal Republic). Estimates of average hourly labor cost

for wage earners and salaried employees, U .S. industry definition,

iron and steel industry, 1964 ___________________________________________________

vi

19

22

33

36

37

39

40

40

41

41

42

46

46

47

47

48

48

49

50

54

55

Page

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Contents— Continued

Page

Appendix B— Continued

Table s— C on t inu e d

B -20. Germany (Federal Republic). Calculation of unit labor cost for wage

earners and salaried employees, U. S. industry definition, iron and

steel industry, 1964 _____________________________________________________________ 56

B -21. Germany (Federal Republic). Estimates of man-hours per ton and

output per 1,000 man-hours, U. S. industry definition, iron and steel

industry, 1964 ___________________________________________________________________ 57

B -22. United Kingdom. Estimate of minimum and maximum weighted output,

iron and steel industry, U. S. industry definition, 1964 ____________________ 58

B-23. United Kingdom. Estimates of employment cost for wage earners and

salaried employees, U. S. industry definition, iron and steel

industry, 1964 ___________________________________________________________________ 61

B-24. United Kingdom. Estimates of total hours worked, U.S. industry

definition, iron and steel industry, 1964 _____________________________________ 62

B-25. United Kingdom. Estimates of average hourly labor cost for wage

earners and salaried employees, U.S. industry definition, iron

and steel industry, 1964 ____________________________________________ 63

B -26. United Kingdom. Calculation of unit labor cost for wage earners

and salaried employees, U.S. industry definition, iron and steel

industry, 1964 _____________________________________________ 63

B -27. United Kingdom. Man-hours per ton and output per 1,000 man-hours,

U.S. industry definition, iron and steel industry, 1964 ____________________ 64

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F i g u r e 1. I R O N A N D STEEL I N D U S T R Y , 1 9 6 4 :

UNITED STATES, FRANCE, GERM ANY, A N D UNITED K IN G D O M

Comparison of Unit Labor Cost, Hourly Labor Cost, 

Output per M an-H our, and Man-Hours per Ton

IN D E X (U S =1 00) 

240 ------------------------

220

200

180

160

140

120

UNIT LABOR COST HOURLY LABOR

COST

OUTPUT PER MAN-HOURS

MAN-HOUR PERTON

vlii

— 240

— 220

— 200 

— 180 

— 160

— 140

— 120 

— 100 

— 80 

— 60

— 40

— 20 

-J 0

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Introduction

The international competitive position of

the iron and steel industry in the United States

is affected greatly by cost as reflected in

price. Other factors such as product design,

quality, and promptness of delivery are also

important, but because the market for steel

products is highly competitive, price is an

important factor in the international market

for these products.

A lth o u g h development of intercountry

comparisons of total cost per unit of output

has not been attempted, sufficient data have

been compiled to make comparisions of labor

cost, which is a sizable part of total cost in

the iron and steel industry. In the United

States in recent years, labor cost has been

about 40 percent of total cost. In France,

the Federal Republic of Germany, and the

United Kingdom, labor cost is between 20 and

30 percent of total cost. 1

The present study compares unit labor

cost in the United States with that in France,

the Federal Republic of Germany, and the

United Kingdom. These three countries of

Western Europe have the largest and most

fully integrated iron and steel industries.

Together, these c o u n t r i e s exported about

2. 2 million short tons of steel mill products

to the United States in 1966. 2 * The study also

compares output per man-hour and hourly

labor cost in these four countries. The re ­

sults are summarized in figure 1.

Data limitations have prevented the development of precise comparisons. Thus the

results for the countries of Western Europe

are presented as ranges (high and low estimates) in order to account for possible variations stemming from gaps in available published data. The results for the United States

are not presented in the form of a range

since available data are much more complete.

Unit labor cost in the United States, at

$58. 77 per ton of finished steel in 1964, was

considerably higher than that in any of the

other three countries, Estimates of total

labor cost per unit of output in F r a n c e ,

G e r m a n y , and the United Kingdom ranged

from 57 to 72 percent of the cost in the United

States. It is not possible to indicate with certainty the relative standing of the three foreign countries considered, but the cost in the

United Kingdom was probably somewhat lower

than the cost in France. If the actual cost

in Germany fell near the middle of the range

of estimates for Germany, the cost would

have been approximately midway between the

cost in France and the United Kingdom.

As can be seen in figure 1, hourly labor

cost in the United States was much higher

than in any of the other three countries; total

cost for wage earners and salaried employees

in the European countries was about one-third

of the cost in the United States.

A lt h o u g h hourly labor cost was much

higher in the United States than in the other

three countries, more man-hours were required per ton of output in each of the European countries than in the United States, partially offsetting the lower hourly labor cost

advantage in these countries. About twice

as many man-hours were required per ton of

output in France and the United Kingdom as

in the United States; the r e q u i r e m e n t in

Germany was somewhat less.

It must not be inferred from the results

obtained for unit labor cost that differences

among the four countries in other costs of

production are of the same magnitude or even

in the same direction. The prices of some

inputs such as coal and electricity are certainly higher in Europe than in the United

States, although other prices probably are

lower abroad than in the United States. The

prices of some inputs are determined largely

by world commodity prices and may not vary

greatly among countries. The impact of individual price differences on production cost

is hard to evaluate, however, because of differences in th e efficiency of utilization of

material inputs and the extent to which other

inputs may be substituted. In any event, unit

labor cost alone cannot measure th e cost

competitiveness of an industry in international trade.

1 Annual Statistical Reports (New York, American Iron and

Steel Institute); Unternehmen und Arbeitsstatten, Reihe 1, Die

Kostenstruktur in der Wirtschaft, I. Industrie und Energiewirtschaft,

1962 (Wiesbaden, Statistisches Bundesamt); and unpublished estimates. The German study indicates that labor cost accounted for

approximately 24 percent of total cost in the German steel industry

in 1962, on the basis of the German industry definition. The cost

of materials and work contracted out (excluding maintenance)

accounted for approximately 53 percent of total cost.

2 1 .4 million short tons in 1964. The United States exports

very little steel to these countries.

1

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2

It must be remembered, also, that international competition takes place not at steel

mills but where the steel consuming industries are located. Therefore, the cost of

transportation is an important factor in a ssessing the competitive position of a particular country in international markets. This

study does not attempt to evaluate transportation and distribution costs for the different

countries or market areas.

In addition, the fact that unit labor cost

in the primary iron and steel industry is

higher in the United States than in Western

Europe by no means implies that this is true

fo r every steel mill product or for every

plant in each country. The partial comparative data available on list prices show that

prices are generally lower in Europe than in

the United States, but data are not available

for all products. No information can be obtained on actual transaction prices, which

often differ greatly from list prices and which

normally might be expected to reflect production costs over an extended period of time.

Moreover, the efficiency of plants and companies may vary greatly in the same country.

The most efficient, of course, are likely to

be the more important in international trade.

The comparison of unit labor cost by product

or for individual companies or plants has not

been attempted.

The methods used in this study are explained in considerable detail. A section on

the general method3 precedes the presentation of results in the belief that some knowledge of the procedures followed will lead to

greater understanding of the results. A

detailed discussion of the weighting system

employed and an explanation of the data used

in the calculation of figures for each country

have been included in a final section devoted

entirely to methods. This latter section also

includes some discussion of th e quality of

steel produced by the countries and possible

means of allowing for quality differences

among the countries. A short explanation of

the production processes of the iron and steel

industry and th e definition of the industry

used in this study is included in the section

entitled "The Iron and Steel Industry. " This

explanation will be helpful to persons who

desire a full understanding of the study but

are not well acquainted with the production

processes and products of the iron and steel

industry.

3 The general approach followed in this study is outlined in 

a technical note prepared by William C. Shelton and John H. 

Chandler. See "International Comparisons of Unit Labor Cost: 

Concepts and Methods, " Monthly Labor Review, May 1963, 

pp. 538-546.

General Method

Definition of Unit Labor Cost

Unit labor cost is the ratio of total labor

cost, in money terms, to total output produced by labor (in concert with other factors

of production), in physical terms. In this

study, the unit of measure is dollars per

short ton of final steel products. 4 Unit labor

cost can be obtained also from hourly labor

cost and output per man-hour (or man-hours

per unit of output). Algebraically, these relationships may be expressed as follows:

Let:

Q = quantity of output 

E = aggregate labor cost (or expenditure)

L = man-hours of labor

then,

Hourly labor cost = -j— 

Output per man-hour = ■

Man-hours per unit of output =

TT . . , E E/L E L Unit labor cost = — -T ?

From these relationships it can be seen

that unit labor cost equals hourly labor cost

divided by output per man-hour and also

equals hourly labor cost times man-hours per

unit of output. The method used in this

study to derive unit labor cost figures is explained in detail in appendix A.

Labor Expenditure

Labor expenditure includes direct payment for the services of all production and

nonproduction 5 labor employed within the industry and the cost of all supplementary benefits. Only those worker s who are contributing

to the production and sale of goods included

in the definition of the industry are covered

by the expenditure data.

4 Products shipped out of the industry, as defined.

^ Such as maintenance workers, janitors, salaried employees, 

and other workers not directly involved in producing a product of 

the industry.

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3

Table 1. Items Included in Labor Cost, by Country, 1964

Item United

States F ranee Germany United

Kingdom

Direct payments:

Regular wage or salary------------------------- ------- X X X X

Shift differential--------------------------------------------- X X X X

Overtime and other premiums 1-------------------- X X X X

Productivity bonuses or payments

based on production------------------------------------- 2x X X X

Cost-of-living allowance------------------------------- X X X X

Bonuses and gratuities----------------------------------- X X X X

Holiday pay------------------------------------------------------ X X X X

Vacation pay----------------------------------------------------- X X X X

Legally required social insurance costs 1 *3 4--------- X X X 4x

Contractual5 or voluntary social

insurance costs 6------------------------------------------------ X X X X

Family allowances7 *---------------------------------------------- (!) X X X

Payment in kind---------------------------------------------------- (!) X X X

Recruitment and training expense-------------------- (9 ) 10x 10x 10x

Tax on wages and salaries---------------------------------

Subsidized services---------------------------------------------

(IE)

11 X

13x 13x 13x

1 For work on Sundays and holidays and for dangerous or

inordinately arduous work, etc.

Would be included if incurred by employer.

3 Such costs in the United States include taxes for old-age,

survivors, and disability insurance; unemployment insurance; and

State sickness insurance.

4 Excluding the National Health Insurance Plan.

5 Included in a labor-management contract.

^ Such as supplemental unemployment benefit plans and

company pension and insurance plans.

7 May be a direct payment to worker and may be legally

required, contractual, or voluntary.

Q

Not incurred.

9 Largely covered in the form of wages and salaries to

apprentices and instructors.

10 About 2 .2 percent of total labor cost in France; 1.6

percent in Germany, including wages and salaries of apprentices

and instructors^ and 0 .4 percent in the United Kingdom.

11 5 percent.

Partly covered in wages and salaries.

13 Possible 1 percent of total labor cost in France and Germany, including wages and salaries; and 0. 8 percent in the United

Kingdom.

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4

Labor expenditure in this study includes

the following costs: Ail monetary remuneration paid directly to the worker, including

bonuses, premium pay, and holiday and vacation pay; family allowances; employer social

insurance payments to both public and private

funds; and payments in kind. The French,

German, and United Kingdom data (as collected

by survey and reported) also include small

expenditures for recruitment and training and

subsidized services; the French data include

the cost of a 5-percent tax on wages and

salaries. ° Family allowances, the payroll tax

as in France, and payments in kind are, of

course, costs that generally are not incurred

by U. S. employers. Labor cost items considered in the study and the countries in

v/hich each item is incurred are indicated

in table 1.

Reference in this study to "w ages" or

"sala rie s" means monetary remuneration

excluding nonproduction bonuses 7 and holiday

and vacation pay. "Total labor cost" for wage

earners or salaried employees means all

costs as sociated with the employment of workers, as shown in table 1.

In the United Kingdom, some social costs

are incurred indirectly by employers and

therefore are not considered as labor cost; in

other countries they normally would be included as direct social insurance payments

and thus would be included in labor expenditure. This is true particularly of costs related to the National Insurance Program,

which is financed out of general tax revenue,

part of which comes from industry taxes.

Employer labor cost in the United Kingdom

would be higher if a portion of employer income tax payments were treated as a direct

expenditure for labor.

The Need for Weighting

Since the output of the steel industry

comprises a large variety of products and

since labor input (and thus cost) requirements

vary greatly from one product to another,

the output of each product must be weighted

in such a way that more value is given to

those products requiring relatively greater

labor input and less value to those requiring

less labor input. If this were not done, the

unit labor cost in a country producing only

products requiring little labor input would be

understated relative to the unit labor cost in

a country producing only products requiring

a high labor input. Thus, the output figure

used in the calculation of unit labor cost is

a weighted combination of the outputs of all

the products of the industry.

The weights are based on the experience

of the United States steel industry and reflect

relative man-hour requirements per ton of

each product; that is, if twice as many manhours are required to produce a ton of product A as to produce a ton of product B, the

weight for product A is twice the weight for

product B. The weight for any given product

reflects man-hour requirements in the final

process used to make that product, in addition to all man-hours in prior processes beginning with the production of coke.

The weights were derived from relative

man-hour weights compiled for use by the

Bureau of Labor Statistics in measuring output per man-hour in the United States steel

industry. This derivation is described fully

in the section on "Methods and Data Used. "

The total weighted output figure is obtained by multiplying the output of each product by the weight for that product and then

summing the resulting figures. Thus,

weighted output for a foreign country is not

the actual tonnage output of that country but

the output measured in United States composite tons. It approximates the output that

would have been produced if the foreign country had produced steel products in the same

proportions as the United States. 9

Minimum and Maximum Estimates

Data for France, Germany, and the United

Kingdom are often not as detailed as data for

the United States. For example, the output

of each product in the United States is distributed among three grades of steel----carbon,

alloy, and stainless— whereas a similar breakdown for the other countries is usually not

available, except in the United Kingdom. The

output of pipe and tubing in the United States

is classified in five or six categories according to the use for which it is intended, such

as pressure tubing, oil-country goods, and

line pipe; for the other countries, data are

normally available only according to method

of production— welded or seamless..,. *1

6 This is not a payroll tax as normally understood in the 

United States, but is in addition to (or other than) social insurance 

payments.

1 Not production incentives, such as payments based on output, which are a part o f day-to-day compensation.

The weights used in the calculation are such that, for the 

United States, £ Q iW f = £ Q i, where Qj - the output of the ith 

product and W f = the weight for the ith product.

Assuming that relative man-hour requirements are the same 

in the foreign country as in the United States. See section on 

"Methods and Data Used" and appendix A.

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5

In addition, complete labor expenditure

data are not available for every country, and

that which is available may not pertain precisely to the industry as defined for this study.

In order to make allowances for these

and other data limitations, the results for

France, Germany, and the United Kingdom

have been presented in the form of a range

based on high and low estimates. If, for

example, the distribution of a country*s pipe

and tubing p r o d u c tio n among the several

functional classifications of pipe and tubing

is not known, two different distributions have

been developed, the first placing as much of

the total output as would appear possible—

after examination of available data— in categories requiring relatively few man-hours,

and the second placing as much of the total

as would seem possible in categories with

relatively high man-hour requirements. The

total weighted output in the first case would

be smaller than the weighted output in the

second case. The same procedure was followed in making two distributions of alloy and

stainless steel and in other cases— both on

the output and labor expenditure sides of the

unit labor cost equation— where complete information is not available.

In estimating maximum and minimum

figures, the following procedure was used:

(l) Where the possible error----resulting from

definitional differences or gaps in the data----

in a given figure is small (say, of the order

of 1 percent of the figure or less), a single

figure has been used; (2) where the possible

error is so m e w h a t larger, a deliberately

broad range has been allowed; and (3) in aggregating items, the maximum and minimum

figures have been combined in such a way as

to produce the broadest possible resulting

range. The range does not allow for certain

differences among the countries, such as in

the degree of vertical integration or in the

quality of steel produced. These differences,

however, as indicated in later discussion,

appear to be quite small.

For France, the minimum estimate of

unit labor cost is about 8 percent lower than

the maximum estimate; for the United Kingdom, the difference in the two figures is

about 10 percent. In Germany, however, the

minimum figure is approximately 19 percent

less than the maximum figure. The ranges,

of course, reflect the availability or comparability of data from each country.

Results

Since unit labor cost can be determined

from hourly labor cost and man-hours per

ton (or output per man-hour), the results of

the study are presented in such a way as to

separate out these two components. The first

section discusses unit labor cost, followed

by sections on hourly labor cost and manhours per unit of output and, finally, a summary section on all three measures.

Unit Labor Cost

Figures on unit labor cost have been

calculated first from aggregate labor expenditures measured in country currencies and

then converted to U. S. dollars at the average annual spot rate of exchange (1964), which

corresponds very closely to the par value exchange rate for each country. 1

Unit labor cost figures for France, Germany, and the United Kingdom do not represent the cost of producing a national composite ton of steel in each c o u n t r y but

approximate the cost of producing a U. S.

composite ton. * 11 If relative man-hour requirements are the same in a foreign country

as in the United States, then the unit labor

cost figure for this country would be equal

to the cost of producing a U. S. composite

ton of steel. (See appendix A. )

Unit labor cost figures converted to U. S.

dollars are presented in table 2. As is evident from the table, unit labor cost in the

United States, at $58. 77 per ton in 1964, was

considerably higher than that in any of the

other three countries. Estimates of total

labor cost per unit of output in France, Germany, and the United Kingdom range from

57 to 72 percent of the cost in the United

States. Because the range in estimates for

Germany is rather broad, it is not possible

to indicate with certainty the relative standing of the three foreign countries considered,

Since unit labor cost is a cost of making a product to be

marketed, international comparisons of this cost should reflect

commercial rates of exchange. The commercial rate is, of course,

relevant in analyzing the cost competitiveness of an industry in

international trade, which is the primary interest in international

comparisons of unit labor cost.

11 Or, what unit labor cost would have been if the U. S.

product distribution had been produced instead of the distribution

which was in fact produced. Of course, comparisons on the basis

of composite tons of other countries would be useful, but product

weights necessary for these comparisons are not available.

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Table 2. Unit Labor Cost in the Iron and Steel Industries of the United States,

France, Germany (Federal Republic), and the United Kingdom, by

W orker Category, U. S. Industry Definition, 1 1964

Worker category United F ranee Germany United Kingdom

States MinimumMaximumMinimum

MaximumMinimum

Maximum

In U. S. dollars 2 per short ton

Wage earners:

W ages-------------------------------------

Total cost 3-----------------------------

34. 01

43. 17

15. 09

27. 29

16. 10

29. 56

17.93

26. 35

22. 30

32. 77

23. 89

27. 59

26. 71

30.85

Salaried employees:

Salaries----------------------------------

Total cost 3-----------------------------

12. 25

15. 60

7. 03

11.70

7. 50

12. 67

5. 38

7. 65

6. 59

9. 36

5. 32

6. 14

5.91

6. 82

Wage earners and salaried

employees:

Wages and sa la rie s--------------

Total cost 3-----------------------------

46. 26

58. 77

22. 12

38. 99

23. 61

42. 23

23. 31

33. 99

28. 89

42. 13

29. 21

33. 73

32. 62

37. 67

As percent of U. S. cost

Wage earners:

W ages-------------------------------------

Total cost 3-----------------------------

100. 0

100. 0

44. 4

63. 2

47. 3

68. 5

52. 7

61. 0

65. 6

75. 9

70. 2

63. 9

78. 5

71.5

Salaried employees:

Salaries----------------------------------

Total cost 3-----------------------------

100. 0

100. 0

57. 4

75. 0

61. 2

81.2

43. 9

49. 0

53. 8

60. 0

43. 4

39. 4

48. 2

43. 7

Wage earners and salaried

employees:

Wages and salaries --------------

Total cost 3-----------------------------

100. 0

100. 0

47. 8

66. 3

51.0

71.9

50. 4

57. 8

62. 5

71.7

63. 1

57. 4

70. 5

64. 1

1 Excluding wire and wire products in the United Kingdom 2 Exchange rates: US $1 = 4.90 new francs, 3. 977 deutsche

and wheels and axles in Germany. The ranges in estimates for marks, 0. 3584 pound.

the European countries do not allow for differences between the 3 including supplementary benefits,

countries in the degree of vertical integration or the quality of

steel produced.

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but the cost in the United Kingdom was probably somewhat lower than the cost in France.

If the true cost in Germany, however, falls

near the middle of the estimated range for

this country, it would be slightly less than

the cost in France and larger than the cost

in the United Kingdom.

If the unit cost of wages and salaries,

excluding supplementary costs, is considered,

the cost in France, Germany, and the United

Kingdom ranges between 48 and 71 percent

of the cost in the United States, and the re ­

lative ranking of the three foreign countries

shows g r e a t e r contrast. On this basis,

France has the lowest unit cost, the United

Kingdom the highest cost, and the cost in

Germany lies between these two. The difference between results obtained considering

wages and salaries only and those obtained

considering total labor-related expenditures

is attributable to the different importance of

supplementary benefits as a proportion of total

labor expenditure in each country. Supplementary benefits are highest in France and

lowest in the United Kingdom.

Unit labor cost for all employees includes

cost for wage earners and cost for salaried

employees. The relative ranking of the three

foreign countries is significantly different for

each group. Estimates of wage earner cost

per ton fall between $26.35 and $32.77 for

all three countries; the lower estimate in all

of them falls between $26. 35 and $27. 59.

For salaried employees, however, total cost

per ton differs greatly among the three countries, being about twice as high in France,

$11.70 to $12.67, as in the United Kingdom,

$6. 14 to $6.82. 12 The cost in Germany falls

approximately midway between these two.

The low cost in the United Kingdom is attributable primarily to low hourly labor cost for

salaried employees. Hourly labor cost for

salaried e m p lo y e e s in France was only

slightly higher than in Germany, but salary

earners constitute a larger percentage of the

labor force in France (about 20 percent) than

in Germany (about 17 percent). Salaried employees account for about 19 percent of the

steel employment in the United Kingdom and

about 22 percent in the United States.

The range in unit labor cost for salaried

employees in the three countries is also much

wider than the comparable range for all workers. Whereas for all workers, unit labor

cost in these countries ranged between 57 and

72 percentofthe United States cost, unit cost

for salaried employees ranged from 39 percent of U. S. cost, the low estimate in the

United Kingdom, to 81 percent of U. S. cost,

the high estimate for France.

Hourly Labor Cost

For international comparisons of production costs, unit labor cost is a factor of

major significance; but since hourly labor

cost is one component of unit cost, comparisons of hourly cost contribute toward understanding the differences in unit labor cost

among countries.

Table 3 presents hourly labor cost figures

expressed in U. S. dollars converted from

national currencies at the 1964 spot rates of

exchange. The hourly data represent cost per

hour worked rather than cost per hour paid.

The wage and salary figures represent pay for

hours actually worked plus cost-of-living allowances, and total hourly cost figures represent all costs associated with employment of

labor.

Because salaried employees usually are

paid by the month or year, attention is not

always given to actual hours worked by salaried employees and such data are not collected by all countries. Data on hours worked

by salaried employees, however, are available for the United States (American Iron and

Steel Institute) and the United Kingdom (iron

and Steel Board and the British Iron and Steel

Federation). For France and Germany, where

these d a ta are not available, hourly cost

figures for salaried employees are based on

an estimate that the number of hours worked

per year by salaried employees is the same

as the number worked by wage earners.

Hourly labor cost in the United States

was much higher than in any of the other three

countries, total cost for wage earners and

salaried employees in those countries ranging

between 29 and 39 percent of this cost in the

United States. Also, among the three foreign

countries, there is considerable variation in

total hourly cost and in the composition----

wages and s a l a r i e s versus supplemental

costs— of labor cost.

Total cost per hour for wage and salary

workers c o m b in e d in the United Kingdom

( $ 1. 33—$ 1. 37) was much lower than in Germany ( $ 1. 69— $ 1. 80) and in France ($ 1 .5 7 —

$1. 60). If only salaried employees are considered, the difference between the United

Kingdom, on the one hand, and France and

Germany, on the other, is even more pronounced. The cost in the United Kingdom *3

The figure for the United Kingdom is affected slightly by

the omission from statistical coverage of some central administrative offices and research and development plants (estimated at 2 to

3 percent of total labor expenditure).

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Table 3. Hourly Labor Cost in the Iron and Steel Industries of the United States,

France, Germany (Federal Republic), and the United Kingdom, by

W orker Category, U .S . Industry Definition, 1 1964

Worker category United F ranee Ge rmany United Kingdom

States Mini­ Maxi­ Mini­ Maxi­ Mini­ Maximum mum mum mum mum mum

In U. S. dollars 2

Wage earners:

W ages------------------------------------

Total cost 3-----------------------------

3. 43

4. 36

0. 76

1. 38

0.7 6

1.40

1. 08

1. 59

1. 15

1.69

1. 13

1.31

1. 16

1. 34

Salaried employees:

Salaries----------------------------------

Total cost3-----------------------------

4. 39

5. 59

1.41

2. 34

1.41

2. 38

1.55

2. 20

1. 62

2. 30

1.25

1.44

1. 30

1 o 50

Wage earners and salaried

employees:

Wages and salaries---------------

Total cost 3-----------------------------

3. 64

4. 63

. 89

1. 57

. 89

1.60

1. 16

1.69

1. 23

1.80

1 o 15

1. 33

1. 19

1. 37

As percent of U. S. cost

Wage earners:

W ages-------------------------------------

Total cost 3-----------------------------

100. 0

100. 0

22. 2

31.7

22. 2

32. 1

31. 5

36. 8

33. 5

38. 8

32. 9

30. 0

33. 8

30. 7

Salaried employees:

Salaries ---------------------------------

Total cost3-----------------------------

100. 0

100. 0

32. 1

41. 9

32. 1

42. 6

35. 3

39. 4

36. 9

41. 1

28. 5

25. 8

29. 6

26. 8

Wage earners and salaried

employees:

Wages and salaries---------------

Total cost 3-----------------------------

100. 0

100. 0

24. 5

33. 9

24. 5

34. 6

31. 9

36. 5

33. 8

38. 9

31. 6

28. 7

32. 7

29. 6

Excluding wire and wire products in the United Kingdom 

and wheels and axles in Germany.

2 Exchange rates: US $1 = 4 .9 0 new francs, 3. 977 deutsche 

marks, 0. 3584 pound.

3 Including supplementary benefits.

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is 62 and 65 percent, respectively, of the

cost in France and Germany. This difference

is explained by the fact that the differential

in hourly cost between salaried employees and

wage earners is much lower in the United

Kingdom than in the other countries. In the

United Kingdom, the hourly cost of employing

wage earners was about 90 percent of the cost

of employing salaried workers ($1.31—$1.34 an

hour for wage earners versus $ 1.44—$1.50

for salaried employees), but in France the

cost for wage earners was only about 59 percent of the cost for salaried employees. In

Germany and the United States, these percentages were 73 and 78, respectively.

For all workers the proportion of total

hourly labor cost accounted for by supplementary benefits ranged from a low of approximately 13 percent in the United Kingdom

to a high of about 44 percent in France.

This proportion is about 32 percent in Germany and 21 percent in the United States.

The low proportion in the United Kingdom

undoubtedly is due in part to the fact that

employer costs which are related to the National Insurance Program are excluded from

labor expenditures.

The differences in hourly labor cost (or

in wages and salaries) which have been described do not necessarily reflect differences

in purchasing power of workers or in their

general welfare. From the point of view of

worker welfare, international comparisons

must take into account the relative prices of

goods and services among countries and also

differences in the types of goods and services

purchased. These factors have not been considered in this study since they do not pertain

to labor cost in the context of production cost

comparisons.

The study does not attempt to make comparisons between the countries in the "quality

of labor, " as might be determined by some

objective standard such as the proportion of

workers in given occupations or professions,

the length and type of education received by

workers, or the level of performance in relation to job standards. The purpose of the

study is not to compare wages or salaries

paid for given types of work or to persons

with a certain level of education in one country with those paid in another. The purpose

is to compare the cost of labor required to

produce a given unit of output in the different

countries, regardless of any special qualities

of the labor employed in each country. Hourly

labor cost is considered because of its inherent relationship to unit labor cost.

Man-Hours per Unit of Output

The second component of unit labor cost

is output per man-hour or its reciprocal,

man-hours per unit of output. In the discussion which follows, the latter concept is used,

since man-hours required by wage earners

and by salaried employees may be added together to obtain total man-hour requirements

and each may be discussed separately in a

meaningful manner. Both types of data are

presented in table 4.

Although hourly labor cost was much

higher in the United States than in the other

three countries, more man-hours were required per ton of output in each of these countries than in the United States, partially offsetting their lower hourly labor cost advantage. About twice as many man-hours were

required per ton of output in France and the

United Kingdom as in the United States. The

requirement in Germany was somewhat less,

the estimates ranging from 1. 58 to 1.85 times

the requirement in the United States.

In comparing labor productivity levels,

the most important measure is total labor

requirements per unit of output (or its reciprocal); but differences in the total figure

among the countries are explained further if

the magnitude of differences in the labor requirements for different groups of the labor

force is known. Thus, data are presented

for wage earners and salaried employees

separately. The breakdown is not meant to

compare the productivity of one group with

that of the other. The proportion of wage

earners to salaried employees is, of course,

affected by different technological and social

conditions in the various countries.

For wage earners alone, the relationship

among countries is similar to the relationship

for all workers, since most workers are wage

earners; for salaried employees alone, the

relationship is quite different. The lowest

man-hour requirement for salaried workers,

as for all workers, is in the United States.

The requirement in France is much higher

for salaried workers than in the United Kingdom, although the all-worker requirements of

these two countries are quite similar. Among

the three foreign countries, Germany has the

lowest requirements for both salaried and all

workers, but the relationship between the

German and the U. S. requirements is much

closer for salaried workers (from 1. 25 to

1. 46 times the U. S. requirement) than it is

for all workers (l. 58 to 1. 85 times the U. S.

requirement).

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Table 4. Output per M an -H our and M an -H ours per Ton in the Iron and Steel Industries

of the United States, France, Germany (Federal Republic), and the

United Kingdom, U.S. Industry Definition, 1 1964

Worker category and United F ranee Gerrnany United Kingdom

unit of measure States Mini­ Maxi­ Mini­ Maxi­ Mini­ Maximum mum mum mum mum mum

Output peir 1,000 man-hours

In short tons:

Wage earners------------------------

Wage earners and salaried

100. 89 47.42 50. 61 51. 65 60. 32 43.51 47.44

employees---------------------------- 78. 73 37. 85 40. 39 42. 68 49. 85 36. 33 39.47

Relative output per man-hour

(U.S. = 100):

Wage earners------------------------

Wage earners and salaried

100. 0 47. 0 52. 0 51.2 59. 8 43. 1 47. 0

employees---------------------------- 100. 0 48. 1 53. 2 54. 2 63. 3 46. 1 50. 1

Man- hours per ton

Short ton:

Wage earners------------------------ 9. 91 19. 76 21. 08 16. 58 19. 36 21. 09 22.99

Salaried employees --------------

Wage earners and salaried

2. 79 5. 00 5. 33 3. 48 4. 07 4. 23 4. 54

employees---------------------------- 12. 70 24. 76 26. 42 20. 06 23. 43 25. 34 27. 52

Relative man-hour requirements (U.S. = 100):

Wage earners------------------------ 100. 0 199.4 212. 8 167. 3 195. 4 212. 8 232. 0

Salaried employees---------------

Wage earners and salaried

100. 0 179. 2 191. 0 124. 7 145o 9 151.6 162. 7

employees---------------------------- 100. 0 195. 0 208. 0 158. 0 184. 5 199. 5 2 160 7

1 Excluding wire and wire products in the United Kingdom countries in the degree, of vertical integration or the quality of

and wheels and axles in Germany. The ranges in estimates for steel produced,

the European countries do not allow for differences between the

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The salaried employee man-hour requirement is about 22 percent of total labor requirements in the United States, 20 percent

in France, and 17 percent in Germany and

the United Kingdom. The relationships reflect the proportions of salaried workers to

total employment in Germany, France, and

the United States, since average yearly hours

worked by wage earners and by salaried em ­

ployees are estimated to be about the same

in these countries. In the United Kingdom,

however, salaried employees work approximately 16 percent fewer hours a year than

wage earners.

When productivity is measured in terms

of output per man-hour, the reciprocal of

man-hours per ton, the United States figures

are, of course, higher than those for the other

countries. For convenience, the data in

table 4 are expressed as output (in short tons)

per 1, 000 man-hours.

Summary

The relationship of unit labor cost to

hourly labor cost and output per man-hour

is summarized for all workers in table 5 and

presented graphically in figure 1. Although

output per man-hour is higher in the United

States than in France, Germany, or the United

Kingdom, this advantage is more than offset

by higher hourly labor cost, resulting in substantially higher unit labor cost in the United

States than in the other countries.

Interpretation and Qualifications

Labor Cost and Total Cost

As mentioned earlier, labor expenditure,

although an important cost, is only one of

several costs of production. The differences

in unit labor cost between the United States

and the European countries studied should not

be interpreted to mean that differences in

other costs are of the same magnitude or even

in the same direction. Thus, unit labor cost

alone cannot measure the cost competitiveness of the steel industries of these countries

in international trade. 13 It is only a measure

of one of the primary costs of production.

A complete evaluation of total cost would

have to take into account all other inputs

contributing to final production and distribution of steel products. This would be an

undertaking equally as complex as the m easurement of unit labor cost itself, and it is

far beyond the scope of this study.

Geographic influences also have an im ­

portant bearing on both the cost structure

and the trading position of individual producers. Proximity to raw materials and

availability of labor supply have long been

regarded as basic to production. Recently,

several countries have located plants at oceanside so that bulk materials can be brought

in at low cost from distant sources and finished products can be shipped readily to distant markets. The vast area of the U. S.

market itself contributes to a variety of trade

patterns. The measurement of these geographical influences on cost and trade, like

the measurement of nonlabor cost, is outside the scope of this study.

The Year 1964 Versus Other Years

Differences in unit labor cost between

countries are affected by several factors

which are subject to change from year to

year. Figures for a single year, therefore,

may not reflect precisely the situation over

an extended period of time. Changes in hourly

labor cost, output per man-hour, and operating rate (through its effect on output per

man-hour) can significantly affect unit labor

cost from one year to the next. The tabulation below gives some indication of the

situation in other years. These data are

based on a preliminary investigation of unit

labor cost trends in the iron and steel industry. Thus, they should not be considered as

precise indicators of changes in absolute

labor cost as presented for 1964 but as general measures of movement in unit labor cost

in each country over the 4-year period 1963-

(1 9 6 4 = 100).

Country 1963 1964 1965 1966

United States1------ 104 100 97 99

France------------------- 103 100 100 -

Germany--------------- 108 100 110 112

United Kingdom - - 105 100 101 107

1 The U. S. data are those developed in the

Bureau's Office o f Productivity, Technology, and 

Growth.

13 See W illiam C. Shelton and John H. Chandler, 'The Role 

o f Labor Cost in Foreign Trade," Monthly Labor Review, May 1963, 

pp. 485-490.

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Table 5. Hourly Labor Cost, Output per Man-Hour and Man-Hours per Ton, and

Unit Labor Cost in the Steel Industries of the United States, France,

Germany (Federal Republic), and the United Kingdom,

Wage Earners and Salaried Employees,

U. S. Industry Definition, 1 1964

Item United F ranee Germany United Kingdom

States Mini­ Maxi­ Mini­ Maxi­ Mini­ Maximum mum mum mum mum mum

In absolute terms

Labor cost per hour, total

(in U. S, dollars2) -------------------

Man-hours per short ton

4. 63 1. 57 1. 60 1. 69 10 80 1. 33 1. 37

(all workers)---------------------------- 1Z. 70 24. 76 26. 43 20. 06 23. 43 25. 34 27. 52

Output per 1, 000 man-hours,

all workers (short tons)----------

Unit labor cost (U. S. dollars

78. 73 37. 85 40. 39 42. 68 49. 85 36. 33 39. 47

per short ton)--------------------------- 58. 77 38. 99 42. 23 33. 99 42. 13 33. 73 37. 67

u. s., figure == 100

Labor cost per hour* total

(in U. S. dollars2) -------------------

Man-hours per short ton

100. 0 33. 9 34. 6 36. 5 38. 9 28. 7 29. 6

(all workers)---------------------------- 100. 0 195. 0 208. 0 158. 0 184. 5 199. 5 216. 7

Output per 1,000 man-hours,

all workers (short tons)----------

Unit labor cost (U. S. dollars

100. 0 48. 1 51. 3 54. 2 63. 3 46. 1 50. 1

per short ton)--------------------------- 100. 0 66. 3 71.9 57. 8 71.7 57.4 64. 1

1 Excluding wire and wire products in the United Kingdom countries in the degree of vertical integration or the quality of

and wheels and axles in Germany. The ranges in estimates for steel produced.

the European countries do not allow for differences between the 2 Exchange rates: US $1 = 4.9 0new francs, 3.977 deutsche

marks, 0. 3584 pound.

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Vertical Integration

In using product weights which reflect

labor embodied in all production from coke

through the final product (cumulative weights),

the implicit assumption is made that the U. S.

industry and the foreign industries, adjusted

to the U.S. definition, are equally integrated;

that is , the production processes included in

the industry and the extent (relative amount) of

contracting out of services are assumed to

be the same in all the countries. 14 This

as sumption is not always true, but apparent

differences in the extent of vertical integration appear to have only a small effect upon

the unit labor cost comparison.

The most important case is coke production. In 1964, almost all of the coke consumed in the steel industries of the United

States and the United Kingdom (93 percent)

was produced by the industry, 15 but the proportion produced by the industry was less

than one-third of the total in France (about

30 percent) and Germany (about 28 percent).

Thus, French and German labor expenditure

is understated to the extent that the expenditure to produce the purchased coke is not included in total labor expenditure. If the labor

expenditure to produce purchased coke in

Franee and Germany were included in total

labor expenditure, it is estimated that the

expenditure figure in both countries would be

increased by about 4 percent and unit labor

cost would be increased by approximately the

same amount.

Adjustment for imports of steel into the

industry would affect unit labor cost in a

similar manner. For example, intermediate

products such as steel ingots, semifinished

steel, or wire rods could be purchased by an

industry from abroad and then further processed in the industry. Again the final product would be weighted as if all labor starting

with the coke process were embodied in it,

whereas the expenditure for labor through the

intermediate stage would be excluded from

total labor expenditure. Imports of products

most likely to be further processed within

the steel industry in 1964 were, by country,

as follows:

Ingots and semifinished products

(including coils for rolling) Wire rod 

(Thousands of short tons)

United States-------- 346 955

F ran ce-------—------ 1,311 191

Germany ----------- - 1,218 583

United Kingdom - - 705 95

SOURCE: Quarterly Bulletin of Steel Statistics for Europe, 

vol. XVII, No. 2 (New York, United Nations Economic Commission for Europe.)

It cannot be assumed that all steel imported

in this form was rolled within the steel industry, although it is likely that much of it

was. Ingots and semis (semifinished products), for example, could be purchased by

foundries or for iron and steel forgings and,

in the United States at least, much of the im ­

ported wire rod was shipped to producers of

wire products not included in the n steel production” statistics used. 16 It is, therefore,

impossible to determine the effect of imports

on unit labor cost in a quantitative manner.

Nevertheless, an example of their effect may

be useful. If, for instance, 5 percent of steel

rolled in the French industry were purchased

from abroad as crude steel and an adjustment were made on the expenditure side of

the unit labor cost equation, French expenditure would be increased by about 1 percent

and unit cost increased by about 1 percent.

If the imports were entirely in sem is, the

change would be somewhat greater. 17 The

effect of this factor on unit labor cost is

probably small in any case.

Other differences in the degree of vertical integration which may affect unit labor

cost relationships are (a) the extent to which

maintenance work and research and development projects are contracted out, (b) the

degree to which imputs such as electricity

and oxygen are produced by the industry or

purchased, (c) the amount of construction

undertaken by employees of the iron and steel

industry, (d) the extent of sales through warehousing firm s, and (e) the prevalence of ore

preparation processes (primarily for production of agglomerated products such as sinter,

pellets, and briquettes) at iron and steel plants.

Most maintenance work is done by employees

of the iron and steel industry in all the countries, but there are instances in which work,

such as the relining of furnaces, is contracted

out. Research and development projects also

are conducted primarily by employees of the

iron and steel industry in all the countries,

but again there are likely to be exceptions.

(Some research and development workers are

excluded from United Kingdom data because

of gaps in statistical coverage. 18) The extent

*4 See Shelton and Chandler, "International Comparisons 

of Unit Labor Cost: Concept and Methods," op. cit., p. 545.

15 Calculated on the basis of production and consumption by 

the iron and steel industry.

^ As reported by the American Iron and Steel Institute.

17 An adjustment producing similar results also could be made 

on the output side o f the equation.

18 These workers and those excluded from central administrative offices account for an estimated 2 to 3 percent o f total labor 

expenditure.

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to which electric power is purchased by the

industry varies somewhat between countries;

in 1964, about 67 percent of electricity consumed in the U. S. industry was purchased,

51 percent in France, and 79 percent in the

United Kingdom. The percentage figure for

Germany is not known, but it is probably

similar to the percentage in France. Most

oxygen is purchased (89 percent in 1964) in

the United States, and a similar practice appears to prevail in the other countries, although exact figures are not available. Some

in-plant (force account) construction is conducted by employees of the iron and steel

industry in the United States, although this

is not the usual case; the extent of force account construction in the other countries is

not known. Sales usually are made by the

steel producer directly to the consumer in

all the countries, but there are somewhat

more sales through intermediaries in France

and Germany than in the United States or the

United Kingdom. Ore preparation processes

are common to iron and steel plants in all

the countries. 19 In general, therefore, practices involving the above factors are similar

in the four countries.

In addition, the U.S. figures (and industry definition) include the production of ferroalloys made in electric furnaces as well as

those made in blast furnaces, but figures for

the other countries include only the production of blast furnace ferroalloys. The effect

of this factor on unit labor cost, however,

is very small.

The possible effect on unit cost of quantitative adjustment for differences in the extent of vertical integration and for other differences between the countries is summarized

in table 6.

Capacity Utilization

Man-hour requirements per unit of output in the iron and steel industry tend to fall

when output rises and to increase when output falls. They also tend to rise when output is at or near capacity for a long period

and to fall when a low level of operations is

prolonged. These changes may affect unit

labor cost, also, depending upon parallel movements in hourly labor cost. The effect may

be even more pronounced in the European

countries than in the United States, because

European producers are less inclined to dismiss workers during periods of low output

than is the case in the United States. In

1964, the rate of capacity utilization was approximately 92 percent in France, 91 percent in Germany, and 88 percent in the United

Kingdom, but only 77 percent 20 in the United

States. Consequently, a comparison between

the United States and other countries in another year, with different relative rates of

capacity utilization, might show somewhat

different results. In fact, unit labor cost

comparisons for 1965 relative to 1964, for

example, could be affected appreciably by this

factor, as the operating rate between 1964

and 1965 increased considerably in the United

States, but fell to 87 percent in France and

83 percent in Germany, and remained the

s a m e in the United Kingdom. (Estimated

changes in unit labor cost over the period

1963—66 are shown on page 1 1 .)

Variation in Cost by Product and Enterprise

The higher U .S. unit labor cost for the

iron and steel industry as a whole does not

mean that unit labor cost by product would

show comparable differences in every case.

Quite possibly the U.S. cost would compare

more favorably with foreign cost for certain

products and may even be lower than foreign

cost in a few cases. This is especially pertinent to the analysis of international trade,

since international competition is normally

conducted by products, not industries. Labor

cost relative to total cost may also vary by

product, and therefore the labor cost factor

may vary in importance, depending on the

particular steel product being traded.

In addition, some enterprises or mills

are more or less efficient than others. This

is particularly significant with respect to

foreign trade, since the most efficient com ­

panies are likely to be of greatest importance in international trade.

New Processes

Relative unit labor costs in the countries

considered may, depending on movements in

wages and salaries, be altered by the adoption of more efficient production processes.

Particularly important is the increasing use

of oxygen steel furnaces, which use far fewer

man-hours to produce a ton of crude steel

than conventional furnaces do. The continuous

casting process by which semifinished products are produced directly from molten crude

steel, although not employed widely at present, will become increasingly prevalent in

the steel industry and may have a significant

*9 Pellets, however, usually are produced at ore mines.

20 W all Street Journal estimate. Official figures are not published currently by the iron and steel industry.

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Table 6. Summary of Items Which Could Affect Relative Unit Labor Cost Figures

But Which Are Not Incorporated in the Range of Estimates

Item United F ranee Germany United

States Kingdom

Coke: Largely produced--------------------- -------------- X 1 +4% x+4% X

Maintenance: By company workers------------------

Research and development: By company

X X X X

workers -------------------------------------------------------------- X X X X

Electricity: 2----------------- ---------------------------------------- X X X X

Oxygen: Purchased-------------------------------------- ------ X X X X

Construction: Usually contracted ou t-------------- X X X X

Ore preparation processes: Included--------------

Sales practices: Direct or through

X X X X

warehousing firm 3---------------------------------------------

Im ports------------------------------------------------------------------

X

(4)

X

(4)

X

(4)

X

(4)

Statistical om ission--------------------------------------------- X X X s+ 2 -3 %

Labor expenditure items:

Recruitment and training------------------------------- (6) 1% 6-l% 6 - 0. 4%

Subsidized services---------------------------------------- (7 ) 7- 1% 7- 1% 7-0 . 8%

x signifies that any differences between

countries would have little effect on

unit labor cost.

Numbers indicate possible effect on unit

labor cost of allowance for differences,

relative to the United. States.

* Coke is largely purchased in France and Germany. If 

the total amount were produced in those countries, their unit labor 

cost would be raised by about 4 percent.

2 67 percent purchased in the United States, about 51 percent in France and Germany, and 79 percent in the United Kingdom.

3 Usually direct in all countries, but there is somewhat 

more selling through intermediaries in France and Germany than 

the United States or the United Kingdom.

4 Allowance for imports would raise unit labor cost by an 

undetermined amount, but probably not more than 1 or 2 percent 

in any country.

3 Some administrative and research and development workers 

are excluded from the data for the United Kingdom. Inclusion 

of these workers might raise unit labor cost in the United Kingdom 

by 2 or 3 percent.

6 Exclusion of all but wages and salaries from this item 

would lower unit labor cost by about 0 .4 percent in the United 

Kingdom and possibly by 1 percent in France and Germany.

7 Exclusion of all but wages and salaries from this item 

would lower unit labor cost by about 0. 8 percent in the United 

Kingdom and probably less than 1 percent in France and Germany.

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effect on man-hour requirements. Other techniques, such as the use of beneficiated ores

(especially pellets), have lowered man-hour

requirements, and their expanded use will

continue to affect labor requirements.

Quality Differences

Differences in the quality of steel products— as measured by chemical content, usefulness, or stringency of specification, etc.—

have not been taken into account in the m easurements in this study, because no operational method of defining and measuring these

differences has been developed. There may

be differences in quality, however, that are

not reflected in the distribution of steel by

product category and that could affect relative unit labor cost levels in the four countries stu d ie d . (See "Quality Differences"

under the later section on "Methods and Data

Used. ")

Other Factors

Other factors which could affect the results of the study are the use of shipments

data instead of production data, the use of

man-hour weights instead of unit cost weights,

and the use of U. S. weights instead of foreign weights. The latter two factors are discussed in detail in the section on "Methods

and Data Used. "

The Iron and

The definition of the iron and steel industry differs somewhat from country to country, just as the steelmaking and finishing

operations differ among countries. The principal production processes are well known,

however, and are generally similar in each

country.

Production Processes

The primary iron and steelmaking processes and their r e l a t i o n s h i p to finished

products (based on the U. S. definition) are

illustrated in figure 2. Iron ore usually is

screened or concentrated and converted to

sinter or pellets before being combined with

coke and limestone in the blast furnace to

form pig iron. Pig iron is combined with

scrap and ferroalloys in steel furnaces to

produce ingots and steel for castings. 22 Ingots are rolled into semifinished products

(blooms, slabs, billets, etc.) on semifinishing

mills or roughing m ills. A small proportion

Shipments data, in s t e a d of production

data, have been used in most cases to m easure output in the United States and the United

Kingdom. Shipments data also have been used

to supplement production data for France and

Germany. Thus, to the extent that inventories of finished products changed over the

year 1964, the output figures for the United

States and the United Kingdom could be overstated or understated, and even the figures

for France and Germany could be affected

slightly. 21 In 1964, however, the inventory

changes were not large enough in any of the

countries to affect appreciably the unit labor

cost estimates. In the United States, the

value of inventories of finished goods and

work in process changed----increased— by only

about 5 percent during 1964. In the United

Kingdom, stocks of ingots and semifinished

products increased by about 114,000 short

tons (6 percent) and finished products, by

about 24, 000 short tons (less than 2 percent).

Corresponding figures for France and G ermany are not available, but judging from production and shipments data, their inventory

changes were not large. In any case, the

effect would be small, because most output

data used for these two countries relate to

production.

Final production figures also could affect output figures to 

the extent that inventories of goods in process changed.

Steel Industry

of semifinished products also are made directly from molten steel by the continuous

casting process. From semifinished products, end products such as structural shapes,

sheets, strip, bars, and seamless pipe and

tubing are made on hot rolling mills or pipe

m ills. Some of the end products are further

processed on cold rolling m ills, or made into

welded pipe, tinplate, or other coated products, or, in the case of wire rod, drawn into

wire and ultimately made into wire products

(nails, barbed wire, woven wire fence, and

others).

Crude Steel Production

The four major processes for manufacturing crude steel— open-hearth, basic B essemer (or Thomas), electric, and oxygen----

22 For the purposes of this study, steel for castings is treated

as if it were shipped out of the industry as such, although some

finished castings may be made in plants engaged primarily in the

production of iron and steel products.

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Figure 2. PRINCIPAL PROCESSES AND PRODUCTS OF THE IRON AND STEEL INDUSTRY

Products from mines and quarries 0

Iron works Steel works ^ Semifinishing mills ^ Finishing mills ^ Finished products and other mills

Ore

SINTERING

and

CONCEN- -h

TRATING

PLANTS

Sinter

and ore

concentrates

Scrap r-i

OPEN HEARTH

FURNACE

Slabs

SHEET

STRIP AND -

PLATE MILLS

Sheets

Strip

Plates

Skelp -

-R O L L IN G___^ Cold-rolled

IV!II_L$ sheets and strip

COATING------► Coated sheets and strip

J IL L S

- PIPE MILLS —► Welded pipe and tubing

FORGING

PRESSES Axles

RAIL

MILLS Rails

BASIC OXYGEN

FURNACE

Continuous

► casting

process

Blooms

WHEEL

MILLS Wheels (RR)

Coal COKE

OVENS

Coke BLAST

FURNACES Pig iron

ELECTRIC

FURNACE

Limestone

Ferroalloys

(blast

furnace

or

electrolytic)

BESSEMER

CONVERTER

(THOMAS)

SEMIIngots FINISHING

MILLS

SHAPE

MILLS

Steel piling

Structural

shapes (heavy)

Steel for

casting

MERCHANT

MILLS

Billets ♦

Light

shapes

Hot-rolled

bars

COLD

FINISHING

MILLS

Cold-finished bars

WIRE ROD

MILLS

WIRE

Wire rods — ► DRAWING

MILLS

Wire and wire products

Tube m PIPE ________^ Seamless pipe

rounds MILLS ^ and tubing

Out of the

Industry

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are used in different degrees by each country. 23 In 1964, the proportions produced by

open-hearth and Thomas processes, especially, varied considerably among the countries under study (table 7). The percentage

of total crude steel produced by electric and

oxygen processes, on the other hand, varied

only slightly among the countries. In the

United States and the United Kingdom, over

70 percent of crude steel was produced by

open-hearth furnaces, but in France, about

54 percent of crude steel was produced by the

Thomas process and only 26 percent by the

the open-hearth process. In Germany, about

33 percent of crude steel was produced by

the Thomas process and 45 percent by the

open-hearth process. 24

The oxygen processes are being adopted

increasingly in the United States and other

countries because of lower production and

capital costs, lower labor requirements, a

faster production rate, and high product quality. By 1966, about one-fourth of total crude

steel was produced by oxygen processes in

the United States, 25 and Germany, and onefifth of the total was produced by this process

in the United Kingdom. The adoption of oxygen processes has been less rapid in France.

There are, of course, many other differences. in production techniques, but the

variations among countries do not seem to be

as significant as those at the crude steel

stage. A detailed analysis of these differences would require extensive descriptions

which are beyond the scope of this study. 26

Definition of the Industry

In the United States. The United States

iron and steel industry, for the purpose of

this study, is defined to conform with reporting practices of the American Iron and Steel

Institute (the source of U. S. data used in the

study). It includes blast furnaces (including

coke ovens), steel works, and rolling and finishing m ills. It also may be defined as including those processes involved in the output

of the product classes listed below: 27

Coke produced at iron and steel plants * Oil-country goods 

Pig iron and ferroalloys 

Ingots and steel for castings 

Blooms, slabs, billets, tube 

rounds, skelp, etc.

Wire rods

Structural shapes (heavy) 

and steel piling 

Plates

Rails—standard and all other 

Joint bars, tie plates, and track spikes 

Wheels and axles

Bars—hot rolled (including light shapes)

Bars—reinforcing 

Bars—cold finished 

Bars—tool steel 

Standard pipe

1 SIC 331 includes all coke production.

Line pipe 

Mechanical tubing 

Pressure tubing 

W ire—drawn 

Wire products 

Black plate 

Tin and terne plate — 

hot dipped

Tin plate—electrolytic 

Sheets—hot rolled 

Sheets—cold rolled 

Sheets—galvanized 

Strip—hot rolled 

Strip—cold rolled 

Sheets—all other coated 

Electrical sheets and strip

In addition, the definition includes processes related indirectly to the production of

these products such as ore concentrating and

sintering plants at iron and steel works, oxygen and electric power plants at iron and

steel works, and other auxiliary processes

at the plant that are necessary for the production of iron and steel. The processing of

coke byproducts and slag, however, is not

included in the industry.

In France, Germany, and the United

Kingdom. The industry as defined in France

excludes the following products included in

the U. S. definition: Pipe and tubing, wire

and wire products, cold-rolled strip, coldfinished bars, and wheels and axles.

The German definition includes forgings,

which are excluded from the U. S. definition,

but excludes wire and wire products, coldrolled strip, cold-finished bars, and some

pipe and tubing.

The United Kingdom definition includes

iron ore, forgings, steel castings, and wrought

iron, which are excluded from the U. S. definition, but excludes wire and wire products

and pipe over 16 inches in diameter. 28

23 In the open-hearth process, a charge of varying proportions 

of scrap and pig iron is refined by heating for a period of several 

hours in an open-hearth furnace. In the basic Bessemer process, 

liquid iron in a "converter" is refined by blowing air, oxygen, or 

other gas through the molten metal. In electric furnaces, which 

often are used to make stainless and other alloy steels, metal 

(usually scrap)is refined by current-induced heating. In the oxygen 

processes (basic oxygen process in the United States), molten 

metal is refined by blowing high purity oxygen on the surface 

of the metal.

24The proportion of steel produced by the Thomas process 

is sometimes of different quality than steel produced by the other 

processes. Quality differences among the countries may affect 

relative unit labor cost levels, but in this case, the effect is not 

thought to be significant, as explained in a later section of the 

study.

25 Over 30 percent of production was by this process in 

February 1967.

26 For a more detailed discussion of new techniques being 

adopted in the United States, see Technological Trends in Major 

American Industries (Bureau ofLabor Statistics Bulletin 1474, 1966).

2? The industry is defined in the 1957 and 1967 editions of 

the Standard Industrial Classification Manual (U. S. Bureau o f the 

Budget) under the title "Blast Furnaces, Steel Works, and Rolling 

and Finishing Mills" (SIC 331). There area few products, however, 

for which output figures used in this study do not equal total U. S. 

production. These cases are noted in the section on "Methods 

and Data Used. "

28 Based on statistical coverage of the Iron and Steel Board 

and the British Iron and Steel Federation. Their definition does 

not correspond exactly to the United Kingdom's 1958 Standard 

Industrial Classification of the iron and steel industry, which includes steel castings and heavy forgings but excludes wire and 

wire products and all pipe and tubing.

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Table 7. Crude Steel Production and Percent Distribution by Manufacturing Process

in the Iron and Steel Industries of the United States, France, Germany,

and the United Kingdom, 1964 and 1966

19

Country

Crude steel

production

(thousands

of short

tons)

Percent distribution by manufacturing process

Open

hearth

Basic

Bessemer

(Thomas)

Acid

Bessemer

Electric

furnace

Oxygen

blown Other

1964

United States--------------- 127,075 77. 2 0. 6 10. 0 12. 2

F ranee------------------------- 21,805 26. 2 53. 6 . 5 8. 5 11. 2 -

G erm any--------------------- 41, 159 45. 1 32. 8 . 1 8. 0 14. 0 -

United Kingdom---------- 29,377 70. 5 5. 5 1. 1 11. 2 11.4 0 . 3

1966

United States---------------- 134,101 63. 4 0. 2 11. 1 25. 3 .

F ranee-------------------------- 21,587 22. 9 52. 6 . 3 9.5 14. 7 -

Germany------------------------ 38,929 39. 2 27. 7 - 8. 7 24. 5 -

United Kingdom----------- 27,233 59. 1 1 5. 3 13. 8 21. 9

1 Includes acid Bessemer, NOTE: Because of rounding, sums of individual items may

not equal totals.

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One of the purposes of this study is to

present results on the basis of the U. S. industry definition. Hence, it has been necessary to subtract from or make additions to

data based on foreign industry definitions to

make the data comparable to U. S. data. The

procedures used to make these adjustments

are explained in later sections on data used

for each country. The only significant gap

in the coverage as adjusted is that output and

labor expenditure data for wire and wire

products could not be included in figures for

the United Kingdom because necessary information was not available,, The effect of this

omission on unit labor cost figures is thought

to be quite small. 29 Also, data on wheels

and axles are omitted from the German figures, but this product category represents

only a very small proportion (0. 6 percent)

of total output.

29 The extent to which this omission could affect the results is discussed under weights in the section on "Methods and 

Data Used. "

Methods and Data Used

Weighting

The weights used in this report to express aggregate output in U. S. composite tons

are derived from 1961 relative man-hour

weights compiled for the use of the Bureau of

Labor Statistics through arrangements made

by the American Iron and Steel Institute (AISI).

The relative weights, which were originally

furnished for preparing the BLS index of output per man-hour in the domestic steel industry, are expressed in terms of man-hour

requirements per ton of each product relative

to the man-hour requirements per ton of coke.

They were based on data reported by companies which accounted for 82 percent of the

1961 total shipments of steel reported to AISI.

For deriving these original weights, the manhours reported for each steel mill product

included only those man-hours required beyond the ingot stage. The man-hours reported

for coke included the total man-hours re ­

quired in each company’ s coke and chemical

plants. The man-hours required for pig iron

and ferroalloys and steel for ingots and castings included only those man-hours allocated

to these specific operations, thus excluding

man-hours in prior processes. The relative

weight for each product was obtained by dividing its man-hour requirements per ton by

the man-hour requirements per ton of coke.

In addition to weights for coke, pig iron and

ferroalloys, and ingots and steel for castings,

weights were compiled for 28 carbon steel

products, 18 alloy steel products, and 15

stainless steel products. 30

For the purposes of this study, the original weights have been adjusted to be cumulative throughout, that is, they reflect all stages

of production within the industry from coke

through the end products. (See appendix table

B-l). For example, the weight for wire rods

reflects man-hours embodied in the production of coke, pig iron, crude steel, and semifinished steel, as well as the labor required

to make wire rods from semifinished steel.

The weights have been adjusted in this manner in order to calculate the absolute unit

labor cost to produce a composite ton of finished products rather than the cost in each

incremental stage of production.

If incremental weights are used for a

country-to-country comparison, some distortion results because of variation between

countries in tonnage yields from one stage of

production to another. If, for example, more

wire rod is made from a ton of crude steel

in country A than in country B, incremental

weights would result in an overstatement of

the weighted output of country B relative to

country A. If both countries produced the

same amount of wire rod, the sum of weighted

output for crude steel and wire rod would be

higher in country B than in country A because

country B would have to produce more crude

steel per ton of rod. This difficulty is avoided

if cumulative weights are used. 31 Only output not consumed in further production is

credited in the aggregate output figure for

an industry.

However, there is a practical disadvantage to using cumulative weights when the

industries of the various countries are not

integrated to approximately the same degree

(as for example, differences in the extent to

which coke is purchased or produced by the

industry, or in the percentage of steel which

is imported for further processing within the

steel industry). Incremental weights may be

more appropriate if these differences are

large, since weighted output derived with incremental weights reflects only production by

the industry in question.

30 For a more detailed description of the derivation of these 

weights, see Indexes of Output per Man-Hour, Steel Industry, 

1957—63 (Bureau of Labor Statistics, 1964).

31 This statement is true given that only one country's (i. e. , 

the United States) weights are available and can be used in the 

study. Somewhat different results might be obtained, of course, 

if weights of another country were used.

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The adjustment of the original weights,

making them cumulative throughout, is based

on the following assumptions:

1. Carbon, alloy, and stainless qualities

of steel contain different amounts of pig iron

(and thus scrap) per ton of crude steel. Stainless crude steel contains almost no pig iron

(estimated at 0. 03 ton per ton of crude steel)

because it is made almost entirely from scrap

in electric furnaces. Approximately 0. 63 ton

of pig iron is required per ton of carbon

crude steel and 0. 43 ton per ton of alloy

crude steel. 32 The other major component

in the production of carbon and alloy crude

steel is scrap.

2. Each carbon end product, each alloy

end product, and each stainless end product

contains, on the average, an equal amount

of pig iron. 33 This means that the weight

for each carbon end product should embody

the same man-hour requirements for the coke

and pig iron stages of production. The same

is true for alloy and stainless products.

3. Finally, the pig iron requirement per

ton of end product has been determined from

the estimated pig iron used in the production

of each of the three qualities of steel divided

by shipments of each quality. 34

The original weights and the cumulated

weights, in addition to notes on the adjustment procedures, are presented in appendix

table B-l. The relative weight for coke (l. 0)

remains the same. The cumulated weight for

pig iron and ferroalloys (2. l) has been obtained by adding the weight for coke times the

coke requirement per ton of pig iron (0. 68)

to the original (incremental) weight for pig

iron and ferroalloys (1.4). The cumulated

weight for carbon crude steel (3. 3) has been

obtained by adding the cumulated weight for

pig iron and ferroalloys (2. 1) times the estimated pig iron requirement per ton of carbon

crude steel (0. 63) to the original weight a ssigned to carbon crude steel (2. 0). The same

procedure has been followed to obtain the cumulated weights for alloy and stainless crude

steel. The cumulated weight for any carbon

final product has been obtained by adding to

the original weight for the product (a) the

estimated quantity of pig iron per ton of carbon end product times the cumulated weight

for pig iron and ferroalloys (0. 91 x 2. 1) plus

(b) the original weight for carbon crude steel

divided by the yield factor for the product

(2. 0 divided by yield factor). The same procedure has been followed for alloy and stainless end products. The yield factors used

have been estimated from 1947 data furnished

by the U. S. steel industry, together with

more recent information. Since it takes more

than a ton of crude steel to produce a ton of

end product, the yield factors are always less

than one.

These cumulated product weights were

then multiplied by 1964 net shipments from

the U. S. industry and summed to derive an

aggregate weighted output for the year. The

weighted output, however, is many times

greater than the unweighted output figure.

Since the purpose of this study is to present

unit labor cost comparisons in absolute

terms, it is useful to scale or "deflate" the

weights in such a way that the weighted output in the base year and country is the same

as the unweighted output. This process is

shown in appendix table B-2, and the deflated weights are listed in table 8. The

deflated weights, when used with any output

distributed among the various products in

the same proportion as in the base country

(United States) in the base year (1964), will

yield a "weighted output" equal to the unweighted output. If the output of a country

is concentrated in low-weight products, the

weighted output will be less than the unweighted output, and vice versa.

The U. S. weighted output for the year

1964 can be thought of as U. S. output expressed in composite tons, and it follows

from the preceding remarks that this output is

equal to the unweighted output. The weighted

output of another country can be thought of as

equal to the unweighted output of that country

in tons converted to (or measured in) U. S.

base year composite tons, or simply composite tons. A "composite ton, " in this case,

means the equivalent of one ton of steel end

products distributed according to the U. S.

output proportions in 1964.

32 These ratios may be different in other countries.

33 This condition follows from the fact that a certain amount 

of scrap (trimmings, rejects, etc. ) is generated for each end 

product. The amount o f scrap depends on the yield of a given 

product from a ton o f crude steel. If 100 tons of end product can 

be made from 130 tons o f crude steel, then approximately 30 tons 

o f scrap are generated in the production of 100 tons of this product. 

A plant continuously making only this one end product, for example, will use about 100 tons o f pig iron and 30 tons of scrap 

to make 130 tons of crude steel. (Actually, more than 130 tons 

o f input are required to obtain 130 tons of crude steel, and to the 

extent that scrap is purchased from outside the industry, less pig 

iron and more scrap would be used. ) A plant making another 

product that requires, for example, 140 tons of crude steel per 

ton of end product would generate 40 tons of scrap for every 100 

tons of end product produced. This plant would use the same 

amount of pig iron, 100 tons, but more scrap, 40 tons, in making 

the crude steel necessary to produce 100 tons of end product. 

Thus, the production of these two different products will involve 

the same amount o f pig iron but different amounts o f scrap. The 

situation is much more complex when many products are produced 

in the same plant, but, on the average, the rule will still hold.

34 All data pertaining to 1961.

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Table 8. United States 1961 Relative Man-Hour Weights, 1 Iron and Steel Industry,

by Product and Grade of Steel

Product category

Coke----------------------------------------------------------------------------

Pig iron and fe rro a llo y s ---------------------------------------

Ingots and steel for castings-----------------------------------

Blooms, slabs, billets, tube rounds, skelp, etc ■

Structural shapes (heavy) and steel pilings-------—

P lates-------------------------------------------------------------------------

Rails—standard and all other--------------------

Joint bars, tie plates, and track spikes

Wheels and axlesBars—hot rolled (including light shapes)----------------------

Bar s—reinforcing-------------------------------------------------------------

Bars—cold finished-----------------------------------------------------------

Bars—tool steel----------------------------------------------------------------

Standard pipe--------------------------------------------------------------------

Line pipe--------------------------------------------------------------------------

Pressure tubing --------------------------------------------------------------

Wire—drawn----------------------------------------------------------------------

Wire products------------------------------------------------------------------

Black plate------------------------------------------------------------------------

Tin and terne plate—hot dipped--------------------------------------

Tin plate—electrolytic-----------------------------------------------------

Sheets—hot rolled---------------------------------------------------- —------

Sheets—cold rolled----------------------------------------

Sheets—galvanized-----------------------------------------

Strip—hot rolled---------------------------------------------

Strip—cold rolled-----------------

Sheets—all other coated-------

Electrical sheets and stripCarbon Alloy Stainle s s

2. 06 (2) (2)

2. 13 (2) (2)

. 20 . 27 . 45

. 57 1. 09 2. 15

. 80 1. 67 6. 06

. 71 1. 49 5. 85

. 67 1. 43 5. 60

. 70 1. 56 -

1. 46 - -

1. 90 2. 90 -

. 94 1. 47 7. 18

. 68 1. 44 -

1. 44 2. 43 10. 27

5. 81 10. 45 -

1. 26 1. 73 8. 13

1. 53 2. 12 3 10. 35

1. 12 1. 72 -

2. 13 3. 46 18. 33

3. 17 5. 18 18. 93

1. 75 2. 88 10. 54

2. 22 - 10. 80

. 94 - -

1. 47 - -

1. 08 - -

. 59 1. 14 1. 78

. 73 1. 30 6. 76

. 94 1. 61 -

1. 01 1. 30 3. 52

1. 74 12. 74 5. 85

1. 01 - -

1. 76 1. 94 -

1 After adjustment as explained in the text.

2 A breakdown by grade of steel is not applicable.

3 Estimated by the Bureau of Labor Statistics.

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As already indicated, man-hour weights

have been used in this study. For the purpose of unit labor cost comparisons, however,

weights that reflect the relative labor expenditure required to produce different products

of the industry would be preferable. 35 Implicit in the use of these man-hour weights

is the assumption that labor cost per hour

worked to produce one product is the same

as labor cost per hour worked to produce any

other product. This assumption is not entirely true, since wage rates vary from one

task to another. Average hourly earnings,

however, seem to bear no systematic relationship to stages of the production process.

Examination of census data on man-hours and

wages in various stages of production in the

industry indicates that the use of labor cost

rather than man-hour weights would have no

appreciable effect upon the results.

The use of weights based on the production experience of another country* s industry

or the use of some average of weights from

several countries also could affect the results. 36 If each of the steel industries concentrates on the manufacture of products in

which it has a comparative labor requirements advantage, the weighting system used

would tend to disfavor the country from

whose production experience the weights are

derived. 37

Also, since wire and wire products have

not been included in the United Kingdom industry data, some distortion could result in

unit labor cost figures for this country. If

the relative man-hour requirements by product in the United Kingdom are the same as

those in the United States, then no distortion

results; 38 but to the extent that this is not

true, the figures for the United Kingdom could

be affected. 39 Wire and wire products are

not a large part of the industry, however,

and any distortion resulting from their exclusion is not likely to be substantial.

Quality Differences

In addition to differences between countries in the distribution of total output among

the many products of the industry, there may

be differences in the quality of some of the

products produced. Stainless steel strip produced in one country, for example, may not

be as "good" as stainless steel strip produced

in another. As explained in the preceding

pages, the basic question that the study attempts to answer is the cost in other countries to produce a composite ton of steel

comparable to that produced in the United

States. Comparability should be interpreted

to denote not only a like product mix but

also a like quality steel. The question is,

How much does it cost in country A to produce not only the U. S. product mix but also

the U. S. quality of steel? The weights allow

for cost differences due to variations in product mix, but do not allow for cost differences

due to variations in the quality of individual

product categories. To the extent that there

also would be a labor cost difference due to

quality differences, this difference should be

reflected in the comparative figures of unit

labor cost. The problem is to determine

(a) the extent to which quality differences

exist and (b) the labor cost differences which

are associated with any quality differences.

It is difficult to determine what constitutes a quality difference, since judgments on

performance, utility, and substitutability are

often involved. And it is even more difficult

to determine if quality differences, once defined, do in fact exist. Even if these two

unknowns are identified, the determination of

labor cost related to quality variation, which

is a necessary component for this study, still

remains to be made. Since no operational

method for determining and measuring quality

differences in iron and steel products has

been found, no quality adjustment has been

made in this study. However, an example

of one possible quality difference, as well

See Shelton and Chandler, "International Comparisons of 

Unit Labor Cost: Concepts and Methods," op. cit. , p. 544.

36 Ibid.

3^ The rationale is that if two sets of weights from countries 

producing different products were compared, the weights for products making up the majority of the first country's total production 

would tend to be lower in this country than the weights for the 

same products in the second country if these products accounted 

for only a small portion of total production in the second country. 

Therefore, unit labor cost in the United Kingdom (or another 

country) relative to the cost in the United States would probably 

be higher if weights from the United Kingdom (which are not 

available) were used. However, unless the pattern o f man-hour 

requirements by product were very different in the United Kingdom 

and the United States, any increase in U. K. cost relative to 

U. S. cost would be small.

3® Available data indicate that average hourly earnings of 

wage earners producing wire and wire rope are about the same as 

those in the steel industry as defined in the United Kingdom.

39 For example, if twice as many man-hours are required 

to make wire as to make wire rod in the United States as well 

as in the United Kingdom and if similar relative relationships hold 

for other products, no distortion results when wire and wire products 

are excluded. The addition o f output and labor expenditure for 

wire and wire products would not change the unit labor cost results 

obtained for the United Kingdom with these products excluded. 

But if, for example, the production of wire and wire products in 

the United Kingdom requires more man-hours relative to the production of other products than is the case in the United States, the 

inclusion of wire and wire products in the United Kingdom data 

would raise unit labor cost.

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as two possible methods for making an adjustment for such a difference, is presented

below.

The example chosen is the difference in

"quality" of steel produced by the Thomas

(basic Bessemer) process and steel produced

by the open-hearth process. This example

is, of course, only one possible quality variation. There may be differences also in the

quality of end products resulting from differences in other production processes, but

they are difficult to isolate and to quantify.

In fact, differences in quality resulting from

processing after the crude steel stage of production, e. g. , the amount of cold rolling,

stringency of specifications and product control, or tolerances allowed, may be more

important than those resulting from variations in crude steel production processes.

About 54 percent (1964) of French crude

steel, for example, is produced by the

Thomas process, whereas the bulk of crude

steel in the United States is produced by the

open-hearth process. In the Thomas process,

liquid iron in a "converter" is refined by

blowing air, oxygen, or other gas through

the molten metal. In the open-hearth process,

a charge of varying proportions of scrap and

pig iron is refined by heating for a period

of several hours in an open-hearth furnace.

The chemical composition of Thomas

steel usually differs from the chemical composition of open-hearth steel, although it is

often technically possible to produce like

steel by both processes. In most instances,

depending on the Thomas process used,

Thomas steel has a higher content of nitrogen,

phosphorus, and oxygen and also a higher

content of sulphur and hydrogen than openhearth steel. The influence of these chemicals, especially nitrogen, tends to give

Thomas steel greater strength, as measured

by yield point, tensile strength, and hardness,

but less ductility and toughness than openhearth steel. The presence of nitrogen (as

well as phosphorus and oxygen) also leads

to decreased ductility and toughness with age

and at lower temperatures. In addition, the

yield point and hardness of Thomas steel are

increased and tensile strength is decreased

with much less cold working, cold drawing,

or cold rolling than is the case with openhearth steel. For these reasons, Thomas

steel sometimes does not lend itself to these

processes as readily as open-hearth steel.

In fact, Thomas steel is normally not used

at all for cold drawing. For other purposes,

however, the strength characteristics may

not be detrimental and may even be beneficial. Most technical experts consulted feel

that Thomas steel is used largely or entirely

for products or in uses for which it is the

practical equivalent of th e corresponding

open-hearth product.

If the assumption is made that the difference between Thomas and open-hearth steel

does represent a quality difference, an approach to measuring this difference would be

to determine how much more labor expenditure would be involved, and thus how much

higher unit labor cost would be, if France

were to produce steel of open-hearth quality

in addition to the U. S. product mix. 4

There appear to be at least two methods

for determining the labor expenditure associated with an assumed quality difference.

The first approach is based on the relative

labor requirements to produce steel by the

two processes. If this approach were used,

the relative man-hour weights could be adjusted (or additional weights added) to allow

for different labor requirements in the crude

steel production process, so that differences

in the two qualities of steel stemming from

differences in crude steel would be accounted

for in the same manner that allowance is

made for different product distributions.

Following this method, it is estimated that

French unit labor cost in 1964 would have

been about Z percent higher if the French

industry had produced open-hearth steel in

place of its Thomas steel products. * 41

Or, if man-hour weights reflecting quality differences 

were available, in addition to those reflecting man-hour requirements to produce different product categories, how much would 

French weighted output be reduced relative to U. S. weighted 

output because of quality differences, in addition to product mix 

differences.

41 United Nations information indicates that the man-hour 

requirements per ton in the Thomas crude steel process are only 

half as great as the requirements for the open-hearth process. If 

each product weight used with the French output is adjusted to 

reflect the fewer man-hours required at the crude steel stage, the 

French aggregate weighted output on the high cost side would be 

reduced. The reduction would be modest, however, because the 

crude steel stage of production is not very labor intensive. The 

reduction becomes even smaller when consideration is given to the 

fact that more pig iron and less scrap (only about 5 percent of 

total charge) are used in Thomas steel, and hence blast-furnace 

(where pig iron is produced) man-hours per ton of finished steel 

are higher for Thomas steel. No man-hour weight is allowed for 

scrap, because scrap is either purchased from outside the industry 

or is generated as a concomitant of the production ofsteel products. 

In fact, the adjusted weighted output figure would be only about 

2 percent less than the unadjusted figure, and the estimate of 

French unit labor cost would be about 2 percent higher than the 

present figure. This method does not indicate that labor expenditure would necessarily have to be 2 percent higher to produce a 

product with the additional quality, but only that the additional 

quality could be obtained by making the additional expenditure 

which would be involved in producing steel in open-hearth furnaces 

instead of Thomas converters. The additional quality also could 

be obtained by other means o f production, such as oxygen processes.

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The second possible method of estimating

the affect of this assumed quality difference

on unit labor cost is based on the price differential which exists between open-hearth

and Thomas steel products0 List prices in

France for basic quality (type usually produced) steel indicate that Thomas steel is, on

the average, about 9 percent less expensive

than open-hearth steel. Unfortunately, transaction prices are not available. If it is

assumed that the list price differential reflects a difference in qualtity, and also different labor requirements, then the French

weighted output for Thomas steel should be

reduced by the amount of the price difference. 42 Following this method, it is estimated that French unit labor cost would have

been about 5 percent higher in 1964.

The preceding analysis is limited to only

one example of a quality difference and possible methods of adjusting for it. There may

be, and undoubtedly are, many other differences. Even at the crude steel stage of

production, allowances would have to be made

for varying proportions of different crude

steels in each country, It is possible also

that crude steel produced in electric furnaces

should be valued higher than any other, since

the chemical content of steel produced in

electric furnaces can be controlled closely

and the process often is used to make alloy

steels.

Although a precise measure of relative

unit labor costs should allow for quality differences if they exist, it has not been shown

that these differences are so great as to affect

significantly the results of this study.

United States

Output. Output data for the United States

have been obtained from the Annual Statistical

Report of the American Iron and Steel Institute. 43 Since net production figures are not

available for all products of the industry,

net shipments data which cover all products

except coke have been substituted. (See column 1, appendix table B-2. ) Net shipments

of coke have been estimated from production

and consumption data reported in the AISI

Report. 44 These data were used as a basis

for deflating the cumulated weights, as shown

in appendix table B -2.

When the shipments data are weighted

using the deflated weights, the aggregate

weighted output is equal to the unweighted

output but the weighted output of individual

products is different from the unweighted

output. Thus, it is not necessary for the

calculation of unit labor cost to weight the

output of the base country (United States) in

the base year (1964). If the deflated weights

were used with U. S. output in another year,

however, the weighted output and the unweighted output would differ.

Expenditure. Expenditure figures for the

United States ^appendix table B-3) also have

been taken from the AISI Annual Statistical

Report or estimated from data in that re ­

port. 45 Labor expenditure covers both

42 The assumption is that it takes 9 percent fewer man-hours 

to produce Thomas steel end products. Thus, since 54 percent 

of French crude steel is produced by the Thomas process, about 

54 percent of French finished output would be reduced by 9 percent, 

or the total output would be reduced by 4. 9 percent. Reflecting 

this decrease, the high estimates of unit labor cost for France 

would be increased by about 5 percent.

List prices, however, often differ substantially from actual 

transaction prices, and it is the latter prices which indicate the 

extent to which one type of steel is valued over another. Even 

differences in transaction prices may not reflect differences in the 

labor c o s t of production. Price differences could result from 

amortized investment in old Bessemer converters or from the scale 

of production (although the latter does not seem to be the case 

in France). Since this study uses the United States as a base for 

comparison, it would be useful also to know what the difference 

would be in the price of the two steels in the United States. This 

information is not available since Thomas steel (basic Bessemer) 

is not produced in the United States and only a very small amount 

(less than 1 percent) of acid Bessemer (fairly comparable to Thomas 

steel) is produced.

43 The production of some wire and wire products is not 

reported in AISI statistics, because some producers of these products 

do not report production to AISI and because a substantial proportion of this production is in products not considered primary iron 

and steel products. (Wire products included in AISI data are: 

Barbed and twisted wire, coiled baling wire, bale ties, woven 

wire fence, wire staples, and wire nails.) The production of 

some electrometallurgical products (ferroalloys) also is excluded 

from AISI coverage.

44 For the BLS measures of productivity, gross coke production data from the Bureau of Mines are used. However, this 

study, which presents results in absolute terms, requires net production data (final products shipped from the industry) for all 

products of the industry. Also, in measuring U. S. output, the 

Bureau's productivity studies utilize AISI gross production data for 

pig iron and crude steel.

45 Although the BLS Office of Productivity, Technology, and

Growth uses BLS employment, hours, and earnings data whenever 

possible, AISI data have been used in this study for the following 

reasons: (a) There appears to be close comparability between

AISI input and output data, which is of major importance for an 

absolute comparison (whereas there is some difference in coverage 

between AISI output and BLS input data). In the past, the AISI 

has said that some of the establishments which report output data 

do not report employment and earnings data, but recent information from AISI indicates that the current (and for 1964) small 

differences in output and input coverage tend to offset one another, 

(b) The AISI data are based on hours worked (whereas BLS reports 

hours paid), which is the concept used by European countries being 

compared with the United States. (c) AISI publishes the needed 

data on total compensation, which include supplementary benefits for wage employees and all employees and also the earnings 

of salaried employees. Figures on hours worked by salaried employees are also available, (d) The definitional distinction between 

wage and salary workers used by AISI is similar to that us£d by 

European countries being compared with the United States, (e) The 

man-hour weights used are based on the experience of producers 

reporting to AISI.

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production and nonproduction workers and includes both cash earnings and employer expenditures for supplementary benefits. The

AISI defines wage earners as all persons paid

an hourly or a piece rate, and salaried em ­

ployees as all persons paid by the week or

by the month regardless of their part in the

production process.

Expenditure for wages equals total hours

worked by wage earners multiplied by average

"pay per hour worked" by wage earners. Pay

for hours worked comprises the regular wage

rate (including cost-of-living adjustment and

incentives), shift differentials, premiums for

overtime, and premiums for work on Sunday

and holidays. Total labor expenditure, including supplementary benefits, for wage

earners equals hours worked by wage earners

multiplied by total employment cost per hour.

Total labor expenditure for wage earners comprises, in addition to pay for hours worked,

pay for holidays not worked, vacation pay,

and adjustments, plus the cost of supplementary unemployment benefits, pensions, insurance, savings and vacation plans, and em ­

ployer social security payments.

For salaried employees, AISI reports

only "total sa la ries," which include pay for

holidays not worked, vacation pay, and adjustments. It has been estimated that the

expenditure for the latter three items is the

same proportion of "total salaries" as of

"total wages" (pay for hours worked plus pay

for holidays not worked, vacation pay, and

adjustments), which AISI data indicate to be

7. 27 percent. Thus, in order to maintain

the breakdown into wages and salaries and

supplementary benefits, the total expenditure

for salaries in this report is estimated at

92. 73 percent of AISI "total salaries. " (See

appendix tables B-3 and B -4. ) By excluding

the cost of pay for holidays not worked, vacation pay, and adjustments from salary expenditure, the latter is comparable to pay for

hours worked by wage earners, which is used

for wage expenditure in this study. The total

labor expenditure for salaried employees is

based on "total salaries" reported by AISI,

plus the estimated cost of additional supplementary benefits (pensions, insurance, supplementary unemployment benefits, savings

and vacation plans, and social security payments) for salaried employees. The estimated cost of these supplementary benefits,

15. 3 percent of total employment cost (appendix table B-4), is based on AISI financial

data for all steel companies, including affiliated interests. 46-

Hours Worked, Hourly Labor Cost, and

Productivity. Hours worked for wage earners

and salaried employees and hourly labor cost

for wage earners are reported in the AISI

Annual Statistical Report. Hourly earnings

of salaried employees also have been derived

from data in the report. Hours worked,

hourly labor cost, and productivity data are

presented in appendix tables B -5 and B -7.

F ranee

As mentioned previously, data for the

French industry are presented in the form

of a range. A high estimate and a low estimate of weighted production and a high and

a low estimate of labor expenditure have been

developed. Estimates of labor expenditure

have been made for wage earners, salaried

employees, and wage and salaried employees

together. Combining high expenditure estimates with the low weighted output estimates

gives a high unit labor cost figure, and vice

versa.

Output. The French industry definition

(equivalent to the European Coal and Steel

Community (ECSC) definition) excludes pipe

and tubing, wire and wire products, coldrolled strip, cold-finished bars, and wheels

and axles. Hence, it was necessary to incorporate output figures for these products

into the data for the rest of the industry to

make the broadened coverage comparable to

the U. S. industry definition.

Output data for the French "industry"

were obtained primarily from Siderurgie (Iron

and Steel), published by the Statistical Office

of the European Communities, which reports

net production of products, except coated and

electrical sheets, included in the French definition. Coated and electrical sheets are

counted both in their final form and as regular sheets, hot or cold rolled. In addition,

the net production of ingots and semifinished

products is not reported. Output figures (primarily shipments) for products not included

in the French definition are reported as supplementary data in Siderurgie and also in

French sources.

Production figures for the "French products" include output that is intended for conversion into the excluded products, so that

adjustment must be made for double counting

when the excluded products are added. Adjustment also must be made for the double

counting of coated and electrical sheets.

4 ^ An alternative would be to assume supplementary benefits 

for salaried employees to be the same proportion of total cost for 

salaried employees as supplementary benefits for wage earners are 

of the total cost for wage earners. Such an assumption would 

make little difference in the results.

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Seamless pipe normally derives from sem ifinished products or ingots; welded pipe from

hot-rolled strip (partially skelp, following

U.S. definitions); wire and wire products

from wire rods; cold-rolled strip from hotrolled strip; and wheels and axles from sem ifinished products or ingots. To correct for

double counting when these products are added

to the French definition, shipments figures

minus shipments for conversion into other

steel products have been used, instead of production data, for semis and ingots, hot-rolled

strip, and wire rods. The output figure for

cold-finished bars was subtracted from the

ECSC production figure for hot-rolled bars

(and light sections), which includes material

for conversion into cold-finished bars, with

allowance for some yield loss. ECSC production figures for coated and electrical

sheets were subtracted from ECSC production

data for hot- and cold-rolled sheets.

The primary obstacle to comparing U.S.

and French output is that the reporting of

French production is much less detailed than

that of the United States. The AISI reports

carbon, alloy (excluding stainless), and stainless steel shipments of each product category;

for France, this distribution is normally not

available. Partial information, however, is

available from several sources, including the

United Nations, 47 which report shipments of

all alloy (including stainless) steel for certain

product categories. The AISI reports shipments of four categories of bars, whereas

the ECSC reports separately only the production of reinforcing bars and of all bars

(merchant bars) including reinforcing bars.

In addition, French output of pipe and tubing

usually is reported as seamless or welded;

U.S. shipments of pipe and tubing are reported for five categories according to use,

i. e. , standard pipe, oil-country goods, etc.

There are also some other less important

differences in definition and reporting which

are noted in appendix table B -8.

In order to derive minimum and maximum estimates of weighted output for France,

two independent distributions of total output

among the various product categories have

been developed. (See appendix table B-8.)

The first distribution is intended to emphasize

low-weight products and the second distribution, high-weight products. For a few products, separate data on alloy (including stainless) production are available, 48 and for some

other products, it has been possible to estimate the amount of alloy production. Some

data were obtained also on the distribution of

pipe and tubing by functional classification,

although information covering total production

of pipe and tubing was not available. The

amount of stainless steel produced, however,

was available only for crude steel and a few

end products. 49 In these cases, and in others

where information is incomplete, the two distributions of the products or product in question have been made primarily on the basis of

the U. S. distribution, unless more pertinent

indications were available. Thus, for example, after considering the U.S. percent

distribution of stainless steel among end

products, the two distributions for France

have been made so that as much stainless

steel as would seem at all possible was put

into low-weight product categories, on the

one hand, and as much into high-weight categories, on the other. Consequently, the two

distributions for France are on opposite sides

of the U. S. distribution. The procedures and

data used to make these and other estimates

are described in detail in appendix table B -8.

Labor Expenditure— ECSC Definition.

Detailed data on wages and total labor cost

per hour or month for wage earners and

salaried employees (1964) in the ECSC are

obtained by survey and reported in Salaires

CECA (Earnings in the ECSC), published

annually by the Statistical Office of the European Communities. 50 Hours worked by wage

earners are reported in Siderurgie and relate to hours of work involved in the production of iron and steel products covered by

the ECSC industry definition. Thus, total

wages and total labor cost for wage earners

may be calculated by multiplying, respectively, wage cost per hour and total cost per

hour by hours worked by wage earners during

the year. (See appendix table B -9. )

Wage cost (direct salaries) is here the

equivalent of AISI pay for hours worked, which

has been used for "wage expenditure" in the

United States. Total labor expenditure for

wage earners (and salaried employees), however, includes some costs which generally

are not incurred by employers in the United

States. In the case of France, the most im ­

portant of these are family allowances, payroll tax, and payments in kind. Total cost

in France also includes some small recruitment and professional development (e.g.,

apprenticeship training) expenses.

Hourly data on wages which exclude bonuses and holiday and vacation pay are available for wage earners; however, monthly data

47 Quarterly Bulletin of Steel Statistics for Europe.

48 Primarily in Annuaire de Statistique Industrielle (Paris, 

Bureau Central de Statistique Industrielle).

49 Ibid.

50 The survey covers plants employing 99 percent of all 

wage earners in the French steel industry.

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on salaries 51 include bonuses and holiday and

vacation pay. Total labor cost for salaried

employees, nevertheless, is comparable to

total cost for wage earners. In order to obtain expenditure data on direct salaries for

time worked, equivalent to the expenditure

for wages, it has been estimated that bonuses

and holiday and vacation pay account for the

same proportion of total monetary remuneration of salaried employees as of wage earners

(16 percent); this amount has been subtracted

from the ECSC monthly salary figure. (The

cost of these items, however, is included in

total cost for salaried employees. ) Aggregate

salary expenditure and total labor expenditure

(including all supplements) for salaried employees were obtained by multiplying the appropriate monthly figure by 12 and multiplying

the product by salaried employment. ECSC

data indicate that salaried employment is 20.3

percent of total employment. The derivation

of total labor expenditure for wage earners

and salaried employees according to the

French (ECSC) industry definition is shown

in appendix table B -9.

Labor Expenditure— U. S. Definition.

When the U. S. industry definition is used,

estimates must be made of labor cost to produce products not included in the French

(ECSC) definition. Data on expenditure for

wages and salaries related to the production

of these products were obtained for 1964, but

information on supplementary benefits was

not available. Based on similar data for the

iron and steel industry as defined by the

ECSC, supplementary benefits were estimated

to be between 43 and 4 7 percent of total labor

cost for wage earners and between 3 8 and

42 percent of total labor cost for salaried

employees. (See appendix table B- 10. )

Estimates of labor expenditure to produce

all products covered by the U.S. definition

and of expenditure to produce the excluded

products are presented in appendix table B“ 11.

Hours Worked, Hourly Labor Cost, and

Productivity. Statistics on hours worked by

wage earners in the ECSC industry are published in Siderurgie. Data on hours worked

by salaried employees are not collected by

the ECSC, since these employees are paid

on a monthly or yearly basis. Nevertheless,

to make intercountry comparisons of output

per all employee man-hour (and all employee

man-hours per unit of output), it has been

estimated that salaried employees work the

same number of hours a year as wage earners. Annual hours worked by employees

making products outside the ECSC definition

are estimated to be the same as in the ECSC

industry. (See appendix table B-12.)

Hourly labor cost figures were obtained,

as shown in appendix table B- 13, by dividing

aggregate labor expenditure estimates by e stimate s of hours worked. The hourly labor

cost figures for salaried employees may not

be completely accurate, however, because

of the difficulty in determining exact hours

worked by this group.

Estimates of man-hours per ton of output

and output per 1,000 man-hours were made by

combining weighted output and hours worked

estimates as shown in appendix table B-15.

Germany

Data for Germany also have been prepared in the form of a range. Both high and

low estimates of weighted output and high

and low estimates of labor expenditure have

been developed.

Output. The German industry definition

as set forth in the German Standard Industrial Classification (Sy sterna tis che s Warenverzeichnis fur die Industriestatistik, 1963)

differs from both the U.S. definition and the

ECSC definition. It includes forgings, which

are excluded from both the ECSC and the

U.S. definitions, but excludes wire and wire

products, cold-rolled strip, cold-finished

bars, and some pipe and tubing (mostly precision tubing). Output figures for all products

of the U.S. industry are available, however,

although the coverage in some cases is not

as detailed as for the United States and some

product categories differ from comparable

U.S. categories. The output of wheels and

axles (about 175, 000 metric tons) has been

excluded from the coverage for Germany be -

cause it was not possible to determine the

labor expenditure related to this category.

The effect of this exclusion on unit labor cost

is insignificant because of the small percentage of total output involved and because data

have been excluded from both the expenditure and output sides of the unit labor cost

equation.

Output data for Germany, as for France,

were obtained primarily from Siderurgie and

supplemented with national and United Nations

statistics. Because the adjustments for double

counting of coated and electrical sheets and

products excluded from ECSC coverage were

identical or similar to adjustments made in

output data for France, they will not be discussed here; but a detailed explanation of all

adjustments made in the data is contained in

the footnotes to appendix table B - 16.

51 Data on the average monthly labor cost for salaried em ­

ployees were obtained for the first time by the ECSC for the 

year 1964.

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Again, as with France, the primary difficulty in comparing the German and United

States output is that statistics on the output

of the German industry are much less detailed

than those for the United States; in some

cases, even less detail is available than is

the case for France. Production figures for

alloy and stainless steel are available only

for crude steel, and data on shipments, which

include both alloy and special carbon steels,

are available only for a few product categories as reported by the United Nations

(Quarterly Bulletin of Steel Statistics for

Europe). Production figures for pipe and

tubing distinguish only between welded and

seamless pipe, and no information on output

by functional classification is available. In

addition, the output of bars (including light

shapes) is available only in total and for one

category of bars (reinforcing bars). Other

differences in definitions and reporting and

the basis for establishing minimum and maximum estimates of weighted output are described in detail in appendix table B -16.

Where complete information was not available,

two distributions of the products in question

were made, primarily, on the basis of the

U.S. distribution as described for France.

Because of the large differences between

Germany and the United States in the reporting of output, the range between high and

low estimates of weighted output is considerably broader than for France (or for the

United Kingdom).

Labor Expenditure. Minimum and maximum estimates of labor expenditure for G ermany are based primarily on employment data

from the German publication Industrie und

Handwerk, Reihe I (Wiesbaden, Statistisches

Bundesamt), hourly and monthly labor cost

data from Salaires CECA (Statistical Office

of the European Communities), and hours

worked figures from Industrie und Handwerk

and Sid^rurgie.

The employment figures from Industrie

und Handwerk used in this study relate only

to wage earners, salaried employees, and

apprentices actually engaged in activities related to the production and sale of iron and

steel products. The data cover two separate

industries as defined in Germany— "blast furnaces, steel m ills, and hot rolling m ills"

(German Standard Industrial Classification

number 2710) and "drawing and cold rolling

m ills" (number 3010). The latter industry

includes cold-finished bars and some pipe and

tubing not included in the first industry (and

a small quantity of cold-formed sections).

Wheels and axles have been left out because

they are included in statistics for forgings

and are not covered separately. The number

of apprentices has been estimated from data

published by the Wirtschafts vereinigung

Eisen- und S t a h 1 i n du s t r i e (Statistisches

Jahrbuch) and subtracted from the total employment figure.

Based on hours worked data in Siderurgie

and Industrie und Handwerk, average yearly

hours worked by wage earners were determined to be between 1, 950 and 1,990. Minimum and maximum figures for wage cost per

hour and total labor cost per hour for wage

earners were determined on the basis of

figures from Salaires CECA covering the

ECSC portion of the industry, the maximum

figures being the same as those reported for

the ECSC industry and the minimum figures

being somewhat lower. Aggregate figures for

labor expenditure for wages and total labor

cost for wage earners were obtained, first,

by multiplying employment by the minimum

hours worked per year times the appropriate

minimum hourly labor cost figure and, second, by multiplying employment by the maximum hours worked per year times the appropriate maximum hourly labor cost figure.

Figures on the average monthly cost per

salaried employee for salaries and total labor

cost per month per salaried employee are

based on figures reported in Salaires CECA

covering the ECSC portion of the industry.

The monthly figures for salary cost used in

this study exclude, as for France, the estimated cost of bonuses and vacation and holiday pay, which are included, however, in the

total monthly labor cost figures. The maximum average monthly expenditures per salaried employee, for salaries alone and for

total labor cost, are the same as the respective figures reported for the ECSC portion

of the industry (but excluding bonuses and

holiday and vacation pay from the salary

figure). The minimum figures are some -

what lower than those pertaining to the ECSC

industry. Aggregate figures for labor expenditure for salaried employees, both salaries

and total labor cost, were obtained by multiplying salaried employment by the appropriate

monthly figure times 12. The derivation and

basis for these figures are described in detail in appendix table B -17.

Hours Worked, Hourly Labor Cost, and

Productivity. Hours worked data are shown

in appendix table B -18. The figures on hours

worked by wage earners are the same as

those used to derive aggregate labor expenditure. Average annual hours worked by salaried employees were estimated to be the same

as for wage earners, and total hours worked

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by salaried employees were estimated by

combining these figures with the employment

figures used to derive aggregate labor expenditure for salaried employees.

Hourly labor cost figures, as shown in

appendix table B-19, for wage earners are

the same as those used to calculate total wage

earner labor expenditure. Hourly figures for

salaried employees were obtained by combining hours worked and aggregate expenditure for salaried employees. Figures for

wage earners and salaried employees together

were derived by combining aggregate expenditure and hours worked figures for the two

groups.

Estimates of output per man-hour and

man-hours per unit of output (appendix table

B-21) are based on hours worked and weighted

output data, combined so as to obtain minimum and maximum estimates.

United Kingdom

Data for the United Kingdom are based

almost entirely on statistics from Iron and

Steel Annual Statistics (iron and Steel Board

and the British Iron and Steel Federation).

The industry, according to the statistical coverage of this publication, includes iron ore,

forgings, steel castings, and wrought iron,

which are excluded from the U.S. definition,

but excludes wire and wire products and pipe

over 16 inches in diameter. The latter items

have not been added to the United Kingdom

’'industry” because the necessary data are

not available, but the former items, excluded

from the U.S. definition, have been removed

from the United Kingdom data. The omission

of data on wire and wire products probably

has only a slight effect on the unit labor cost

figures as described earlier under weighting.

Output. Most of the output data used to

develop minimum and maximum weighted output for the United Kingdom are statistics on

shipments. The range is considerably smaller

than for either France or Germany, since the

detail of output statistics (by categories of

output) available for the United Kingdom is

closer to that in the United States. Although

there are many rather small differences in

definition, only in the case of pipe and tubing

(assuming the exclusion of wire and wire

products) was it necessary to allow a broad

range. The output of pipe and tubing in the

United Kingdom is reported only by method

of production, seamless or welded (of which

electric conduit 52 is reported separately).

In a few cases it was necessary to allow a

range in the distribution of alloy steel by

product, since product classifications are not

always the same as in the United States, but

United Kingdom statistics do distinguish output of final products by quality, both alloy

and stainless. Appendix table B-22 notes the

source of each figure used in estimating

weighted output for the United Kingdom and

gives the basis for estimates and adjustments

in United Kingdom figures.

All United Kingdom output data pertain

to a 53-week year, whereas labor expenditure estimates described below are based on

a 52-week year; therefore, weighted output

(appendix table B-22) has been reduced by

one fifty-third to calculate unit labor cost and

productivity figures.

Labor Expenditure. Estimates of labor

expenditure for wages and salaries in the

United Kingdom are based on employment and

weekly earnings data reported in Iron and

Steel Annual Statistics or Monthly Statistics.

United Kingdom data for process workers are

collected and published for each production

process included in the United Kingdom industry definition; data on general and maintenance workers and administrative, technical,

and clerical employees associated with these

processes are reported only for all processes

together. To exclude iron ore, forgings, steel

castings, and wrought iron production processes from United Kingdom data, it was necessary to estimate the number of general,

maintenance, and salaried employees associated with these processes. 53

Weekly earnings estimates for both wage

earners and salaried employees are based on

earnings in 1 week in December 1963 and 1

week in December 1964. Aggregate labor

expenditure figures for wages and salaries

were then estimated from employment and

weekly earnings estimates, 54 with allowance

for days not worked but paid for because of

sickness, holidays, or vacation. These calculations are presented and explained in detail in appendix table B-23.

Electric conduit is considered a fabricated product and is 

not included in the U. S. industry, but this difference in coverage 

is considered insignificant.

53 These estimates were provided by the British Iron and 

Steel Board.

54 In conjunction with aggregate data provided by the Iron 

and Steel Board.

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A recent survey by the United Kingdom

Ministry of Labour indicates that supplementary benefits in 1964 accounted for 13.4 percent of total labor expenditure for wage earners and salaried employees together in the

iron and steel industry. This figure has been

used for estimating both wage earner and

salaried employee supplements. To obtain

estimates of total labor expenditure, both the

minimum and maximum aggregate wages and

salaries were inflated to allow for supplementary benefits amounting to 13.4 percent

of total labor cost. (See appendix table B -23. )

Hours Worked, Hourly Labor Cost, and

Productivity. Total hours worked by wage

earners and salaried employees (appendix

table B-24) are based on employment figures

used to calculate labor expenditure and average weekly hours worked in 1 week in December 1964, 55 with allowance for days not

worked because of sickness, holidays, and

vacations. Minimum and maximum estimates

of average hourly labor cost were calculated

from aggregate labor expenditure and aggregate hours worked figures, as shown in appendix table B -25. Estimates of output per

man-hour and man-hours per ton of output

\\^ere derived from weighted output and hours

worked data, as shown in appendix table B -27.

55 Ibid.

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Appendix A

As discussed in the body of the study, the most appropriate weights for use in a unit

labor cost study would be unit labor cost weights (those which reflect the different labor

cost requirements involved in the production of different products). In the absence of unit

labor cost weights, man-hour weights have been used. The justification for using man-hour

weights is that labor cost per hour worked is assumed to be a constant (c) for all products.

Thus, if we let,

W- = Man-hours required to produce 1 ton of the product,

= Labor cost to produce 1 ton of the i**1 product,

Wj W^c Ui

then = = * ^he w i in this relationship maybe equated with the weight for the

ith product in column (2) of table B—2, although the weight for the ith product in the table

represents w4 -r wi (where W1 = man-hours required to produce 1 ton of coke).

To derive unit labor cost for France, as an example, let:

ULC = Unit labor cost 

f = France 

us = United States 

E = Aggregate labor expenditure 

Qi = Output in tons of the i ^ product.

Using superscripts to indicate the country and subscripts to indicate product,

In fact,

ing supersc ript

Ef = SQi ui

Eus = s<?T Uuf

e £ sq! ui

Eus uu*

neithe r nor Uus

determined from available data.

are known, but aggregate labor expenditure— Ef and E1^— can be

If the aggregate outputs of the two countries were comparable (if the product mix were

the same in both countries), the ratio of unit labor cost in the countries could be expressed

as follows:

ULCf _ Ef Eus _ Ef y .q {

ULC1^ x q \ ' Eus Z Q uf

The aggregate outputs are not comparable, however, due to differences in product mix. To

obtain "comparable" aggregate output measures, man-hour weights may be used in conjunction

with each country's output figures. U.S. weights have been used in this study since comparable data are not available for France (or for other countries). The use of French manhour weights would undoubtedly yield somewhat different results. However, since the industries in the countries being compared are integrated to approximately the same extent

and generally produce the same products with similar plant layout and equipment, the assumpw*f wf f

tion has been made that, -----=— —* In other words, = k W1^ for all i, where k is a con- W[us wj

stant. Under this assumption, either U.S. or French man-hour weights may be used and

33

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34

the results will be the same, If (0) represents aggregate output weighted by U.S. manhour weights, QUS w f

0* w us1

O* w us1

o TM FQf w us

The ratio of unit labor cost in France to that in the United States, when French and United

States outputs are expressed in common terms through the use of U.S. man-hour weights,

may be represented as follows:

ULC1

ULC

O1

O"

F Q • u • F Qf wu

; 2 q “ u u* ’ X q | \yu

The absolute value (in dollars) of unit labor cost in France is given by

ULC1

ULCu

where (*) indicates absolute value in dollars. Since, in the base year, ULCU

ULC

FQ1? Uuf

FQU

ULCf* . FQ- F 9 ? w f FQf u f

Fqu.su1^ v i i

and letting FQ* uf = Ef ,

FQf Wus

ULCf* XQuf w f

FQuf FQ- Wu*

Since the numerator and denominator of the ratio of summations may be multiplied by a

constant without changing the value of the relationship, a constant fn may be chosen such that

Sq1^ m = FQf The constant m must equal

FQU

This is the process carried out in FQf Wf

table Er—Z. The term wf TM represents the deflated weight for the ith product, as shown

in column (4) of table B—2. Thus:

ULC** -

FQUS Wus m FQU,

FQus Fgf wusm 2 qus FQf Wus m

. = JEl

Fq] Wf fn Fpfwf'

whe re w f m - w f

For the purpose of this paper, ^as been called the labor cost in France to

produce a "U.S. composite ton" of steel. Although an artificial term, it helps to verbalize

the results obtained in the study and is mathematically justifiable if the assumption is made

w f wf

that wusl

w;

Using this assumption, it can be shown that equals the output which would have

been produced in France if France had produced the U.S. product distribution. Or, the

French output expressed in U.S, composite tons. If SQ1^ Wf equals total man-hours in the

V q u s y v i i s

United States, then i i equals total man-hours per U.S. composite ton in the United

FQ1^i

States. The number of U.S. composite tons which could have been produced in France may

be represented as follows:

FQf W f |

'so -

SZQUfW'?

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35

sof w{ \ f 2Quf w? \

The factors! _ ) and! — ] have been inserted in the numerator and denominator, £Qf wus ^ ZQus WUS^

if

W UJS w?

respectively, to indicate the result of allowing for different absolute man-hour requirements

WUS wf 2<?f wf ZQJ w| wu? wf

(as opposed to —i_ =—L ) in France and the United States. But rr-;------ = ------------

w us w f S Q f W us Z Q US

1 VV1 i i i i

Thus, the above quantity may be written as

TO? w”?

— ------L • ZQ1?

ZQU*WT

and if m is again chosen such that ZQ1^ wUf m = ZQhs j this becomes

2»[ W^m

s o i

Z Q 1^ which equals 2Q * W us' , where ;W U? ' = W u?m.

It is also of interest to note that, given the assumptions

ULCf _ U* _ 2QU? U*

w * w us uu.s W us

1 _ 1 and —L _ i

W UJS V TM " w ” 5

ULC U*is T Q ul

In this absolute comparisons study, the question of whether the ratio between French unit

labor cost and U.S. unit labor cost represents a Laspeyres- o r Paasche-type relationship

is not of particular relevance, but since it compares the cost in a foreign country to produce

a "U.S. composite ton" of steel, it may be appropriate to consider the study as a Laspeyrestype comparison.

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36 Appendix B.

Table B- BLS 1961 Relative Man-Hour Weights Converted to Relative Cumulative Weights, 

Iron and Steel Industry

Product category

Yield

(perc

Quality of steel

lllcL i

rbon 

uct per 

jf ingot

Carbon Alloy Stainless

BLS Cumulative BLS Cumulative BLS Cumulat:

rcent) 1 weight weight 2 weight weight 3 weight weight

1. 0 1. 0

I. 4 5 2. 1 - - - -

2. 0 6 3. 3 3. 5 7 4. 4 7. 2 8 7. 3

78 4, 8 9. 3 10. 9 17. 7 24. 1 34. 8

76 8. 5 13. 0 20. 2 27. 1 87. 1 98. 1

81 7. 1 11. 5 17. 6 24. 2 84. 5 94. 8

69 6. 1 10. 9 15. 5 23. 1 78. 4 90. 7

. 74 6. 7 11. 3 18. 1 25. 2 - -

. 76 19. 1 23. 6 - _ _ _

. 55 25. 3 30. 8 37. 6 47. 0 - -

. 74 10. 7 15. 3 16. 7 23. 8 104. 9 116. 3

. 81 6. 6 11. 0 16. 7 23. 3 - -

. 70 18. 5 23. 3 31. 8 39. 3 154. 2 166. 3

. 70 89. 3 94. 1 161. 8 169. 3 _ _

. 76 15. 9 20. 4 21. 1 28. 0 120. 7 131. 7

. 76 20. 3 24. 8 27. 4 34. 3 156. 7 167. 7

. 78 13. 7 18. 2 21. 1 27. 9 _ _

. 69 32. 6 37. 4 48. 4 56. 0 284. 5 296. 8

. 69 46. 6 51. 4 76. 3 83. 9 294. 3 306. 6

. 74 23. 7 28. 3 39. 5 46. 6 159. 3 170. 7

. 71 31. 3 36. 0 - 163. 0 174. 9

. 69 10. 5 15. 3 - - - -

. 66 18. 9 23. 8 - - - -

. 66 12. 6 17. 5 - - - -

. 72 4. 8 9. 5 11. 2 18. 5 17. 1 28. 8

. 68 6. 9 11.8 13. 4 21. 1 97. 0 109. 5

. 66 10. 4 15. 3 18. 1 26. 0 - _

. 67 11. 4 16. 3 14. 3 22. 1 44. 2 57. 0

. 65 23. 2 28. 2 198. 3 206. 3 81. 5 94. 7

. 68 11. 4 16. 3 - - _ _

. 68 23. 6 28. 5 23. 8 31. 5 - -

Coke -------------------------------------------------—

Pig iron and ferroalloys -------------------

Ingots and steel for castings-------------

Bloom s, slabs, billets, tube rounds,

skelp, e t c ------------------------------—--------

Wire rods — --------------;— --------------------

Structural shapes (heavy) and steel p ilin g-------

Plates ---------------------------------------------------------------

Rails----standard and all oth er---------------------------

Joint bars, tie plates, and track spikes 

Wheels and a x le s -------------------------------------

Bars— hot rolled (including light shapes}--

Bars----reinforcing -------------------------------------

Bars----cold fin is h e d -----------------------------------

Bars— tool steel------------------------------------------

Standard pipe—--------------------------------------------

Oil-country goods-----------------------------■■■..... —

Mechanical tubing---------------------------------------

Pressure tubing ------------------------------------------

Wire— draw n-----------------------------------------------

Wire products ------------------------- -------------------

Black plate -------------------------------------------------

Tin and terne plate— hot dipped-----------------

Tin plate— ele ctro ly tic ---------- --------------------

Sheets— hot rolled -------------------------------------

Sheets----cold rolled------------------------------------

Sheets— galvanized-------------------------------------

Strip)— hot rolled ----------------------------------------

Strip----cold rolled---------------------------------------

Sheets— all other coated ---------------------------

E lectrical sheets and strip------------------------- 1234567 8

1 Estimates based on data pertaining to the 1946-47 experience of a few companies considered to be representative of 

the industiy at that time, and on other m ore recent information.

2 The cumulative weight for any carbon final product equals the estimated quantity of pig iron per ton of carbon end p roduct times the cumulative weight for pig iron and ferroalloys (0 .9 1 x 2 . 1) plus the BLS weight for carbon crude steel divided 

by the yield factor for the product (2. 0/yield factor) plus the BLS weight for the product.

3 The yield factor for an alloy steel final product is assumed to be 10 points less than the carbon factor for that product.

The cumulative weight for any alloy final product equals the estimated quantity of pig iron per ton of alloy end product times

the cumulative weight for pig iron and ferroalloys (0 .7 8 x 2 . 1) plus the BLS weight for alloy crude steel divided by the yield 

factor for the product (3. 5/yield factor) plus the BLS weight for the product.

4 The yield factor for a stainless steel final product is assumed to be 10 points less than the carbon factor for that 

product. The cumulative weight for any stainless final product equals the estimated quantity of pig iron per ton of stainless 

end product times the cumulative weight for pig iron and ferroalloys (0. 06x2, 1) plus the BLS weight for stainless crude steel 

divided by the yield factor for the product (7. 2 /yield factor) plus the BLS weight for the product.

5 BLS weight assigned to pig iron and ferroalloys plus the product of the estimated coke requirem ent per ton of pig 

iron times the BLS weight for coke. ZTi.4 + (0.68 x 1)0

6 BLS weight assigned to carbon crude steel plus the product of the cumulative weight for pig iron and ferroalloys times

the estimated pig iron requirem ent per ton of carbon crude steel. 0 2 . 0 + (2. 1 x 0 .6 3 )0

7 BLS weight assigned to alloy crude steel plus the product of the cumulative weight for pig iron and ferroalloys times

the estimated pig iron requirem ent per ton of alloy crude steel. O 3.5 + (2. 1 x 0.43)_7

8 BLS weight assigned to stainless crude steel plus the product of the cumulative weight for pig iron and ferroalloys 

times the estimated pig iron requirem ent per ton of stainless crude steel. /J7. 2 + (2. 1 x. 0. 03)0

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T a b le B ~ 2 . D e fla tio n o f R e la tiv e C u m u la tiv e W eig h ts F r o m T a b le B ~ 3,

U sin g U. S, S h ip m e n ts, 1964

Product category

All product categories

Coke ---------------------------------------------------------------------------------

Pig iron and ferroalloys --------------------------------------------- —

Ingots and steel for castings:

C arbon-------------------------------------------------------------------------

Alloy — ------------------------------------------ ------------------------------

Bloom s, slabs, billets, tube rounds, skelp, etc. :

C arbon-------------------------------------------------------------------------

Alloy ----------------------------------------------------------------------------

Stainless-----------------------------------------------------------------------

Wire rods:

C arbon--------------------------------------------------------------------------

A llo y ----------------------------------------------------------------------------

Stainless----------------------------------------------------------------------

Structural shapes (heavy) and steel piling:

C arbon--------------------------------------------------------------------------

Alloy ----------------------------------------------------------------------------

Stainless-----------------------------------------------------------------------

Plates:

Stainless-----------------------------------------------------------------------

Rails----standard and all other:

C arbon-------------------------------------------------------------------------

Alloy ----------------------------------------------------------------------------

Joint bars, tie plates, and track spikes:

C arbon---------------------------------------- ---------------------------------

Wheels and axles:

C arbon--------------------------------------------------------------------------

Alloy ---------------------------------------------------------------------------

Bars— hot rolled (including light shapes):

C arbon-------------------------------------------------------------- ------------

Stainles s ----------------------------------------- -----------------------------

Bars----reinforcing:

C arbon-------------------------------------------------------------------------

Bars----cold finished:

C arbon--------------------------------------------------------------- ---------

Alloy ------------------------------------------------------------------- --------

Stainless-----------------------------------------------------------------------

Bars----tool steel:

C arbon--------------------------------------------------------------------------

Alloy ---------------------------------------------- -----------------------------

Standard pipe:

C arbon--------------------------------------------------------------------------

Alloy ----------------------------------------------------------------------------

Stainless-----------------------------------------------------------------------

O il-country goods:

C arbon--------------------------------------------------------------------------

Alloy ----------------------------------------------------------------------------

Stainle s s --------------------------------------------------- ----------------—

Line pipe:

C arbon-------------------------------------------------------------- ------------

Alloy ------------------------------------------------------ ----------------------

Mechanical tubing:

C arbon--------------------------------------------------------------------------

A llo y ----------------------------------------------------------------------------

Stainless------------------------------ ----------------------------------------

Pressure tubing:

C arbon------------------- --------------------- ---------------------------------

A llo y ----------------------------------------------------------------------------

Stainless---------------------- ------------------------------------------------

Wire— drawn:

C arbon-------------- -----------------------------------------------------------

Alloy — -------------------------------------------------------------------------

Stainless----------------------------------------------------- •-----------------

Wire products:

C arbon----------------------------------- --------------------------------------

Stainless---------------------------------------------------------------------—

Shipments 

(thousands 

of short tons)

Cumulative

weight

Col. Col. 

(1) x (2)

Deflated

weight

M * (2)I

Col. Col. 

(4) X (i)

(1) (3) (3) (4) (5)

87, 716. 3 1, 420, 682. 0 87, 716. 3

(2) 1. 0 _ 0. 06 _

3 2, 771. 4 2. 1 5, 820. 0 . 13 359. 5

179. 7 3. 3 593. 0 . 20 36. 6

144. 8 4. 4 637. 0 . 27 39. 3

5. 3 7. 3 38. 6 . 45 2. 4

Z, 156. 6 9. 3 20, 056. 3 . 57 1, 238. 3

508. 6 17. 7 9, 002. 5 1. 09 555. 8

38. 6 34. 8 1, 343. 4 2. 15 82. 9

1, 148. 1 13. 0 14, 925. 7 . 80 921. 6

39. 4 27. 1 1, 067. 5 1. 67 65. 9

7. 9 98. 1 778. 4 6. 06 48. 1

5, 780. 9 11. 5 66, 480. 3 . 71 4, 104. 4

304. 3 24. 2 7, 363. 3 1. 49 454. 6

0. 1 94. 8 10. 9 5. 85 . 7

7, 605. 8 10. 9 82, 902. 8 . 67 5, 118. 7

825. 7 23. 1 19, 074. 0 i. 43 1, 177. 6

59. 1 90. 7 5, 362. 6 5. 60 331. 1

648. 9 11.3 7, 332. 6 . 70 452. 7

26. 5 25. 2 666. 5 1. 56 41. 2

222. 6 23. 6 5, 253. 5 1. 46 324. 4

493. 1 30. 8 15, 188. 3 1. 90 937. 8

3. 8 47. 0 176. 4 2. 90 10. 9

6, 279. 2 15. 3 96, 071. 9 . 94 5, 932. 0

2, 076. 0 23. 8 49, 408. 3 1. 47 3, 050. 7

45. 7 116. 3 5, 320. 6 7. 18 328. 5

3, 228. 4 11. 0 35, 512. 8 . 68 2, 192. 8

. 6 23. 3 12. 7 1. 44 . 9

1, 173. 9 23. 3 27, 351. 6 1. 44 1, 688. 8

222. 4 39. 3 8, 740. 5 2. 43 539. 7

70. 5 166. 3 1 1, 732. 1 10. 27 724. 4

_ 94. 1 _ 5. 81 _

102. 4 169. 3 17, 332. 8 10. 45 1, 070. 2

4 2, 567. 1 20. 4 52, 369. 3 1. 26 3, 233. 3

4 2. 4 28. 0 66. 8 1. 73 4. 1

- 131.7 - 8. 13 -

1, 290. 4 24. 8 32, 002. 1 1. 53 1, 975. 9

345. 9 34. 3 1 1,862. 7 2. 1 2 732. 4

. 3 167. 7 41. 9 10. 35 2. 6

2, 141. 4 18. 2 38, 972. 8 1. 12 2, 406. 3

492. 8 27. 9 13, 748. 2 1. 72 848. 9

670. 7 37. 4 25, 083. 3 2. 31 1, 548. 7

334. 7 56. 0 18, 742. 9 3. 46 1, 157. 2

3. 3 296. 8 987. 2 18. 33 60. 9

216. 7 51. 4 11, 136. 9 3. 17 687. 6

44. 4 83. 9 3, 724. 6 5. 18 230. 0

26. 9 306. 6 8, 239. 3 18. 93 508. 7

2, 466. 6 28. 3 59,803.9 1. 75 4, 309. 8

26. 7 46. 6 1, 246. 3 2. 88 77. 0

24. 9 170. 7 4, 252. 8 10. 54 262. 6

586. 8 36. 0 21, 126. 0 2. 22 1, 304. 4

( 5) 174. 9 2. 3 10. 80 . 1

See footnotes at end of table.

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Table B~2. Delation of Relative Cumulative Weights From Table B— 1, 

Using U. S. Shipments, 1964— Continued 12345

Product category

Shipments 

(thousands 

of short tons)

Cumulative

weight

Col. Col. 

( 1 ) X ( 2 )

Deflated

weight

§ 3 ] X (2) 1

Col. Col. 

(4) X (1)

(D ( 2 ) (3) (4) (5)

Black plate:

C arbon------------------------------------------------------------------------- 431. 1 15. 3 6 , 596. 0 . 94 407. 3

Tin and terne plate— hot dipped:

Carbon —-------------- —------------------------------------------------------ 150. 1 23. 8 3, 571. 9 1. 47 220. 5

Tin plate— electrolytic:

C arbon------------------------------------------------------------------------- 5, 501. 4 17. 5 96, 274. 8 1 . 08 5, 944. 3

Sheets— hot rolled:

C arbon------------------------------------------------------------------------- 9, 530. 6 9. 5 90, 541. 2 . 59 5, 590. 7

A llo y ---------------------------------------------------------------------------- 379. 3 18. 5 7, 017. 5 1. 14 433. 3

Stainless----------------------------------------------------------------------- 38. 0 28. 8 1, 093. 9 1. 78 67. 5

Sheets— cold rolled:

C arbon------------------------------------------------------------------------- 15, 496. 9 1 1 . 8 182, 863. 3 . 73 1 1 , 2 9 1 . 0

A llo y ---------------------------------------------------------------------------- 30. 0 21. 1 632. 4 1. 30 3 9 . 0

Stainless----------------------------------------------------------------------- 172. 2 109. 5 18, 854. 7 6. 76 1, 164. 1

Sheets— galvanized:

C arbon------------------------------------------------------------------------- 4, 367. 9 15. 3 66, 829. 1 . 94 4, 126. 4

A llo y ---------------------------------------------------------------------------- - 26. 0 - 1. 61 -

Strip— hot rolled:

C arbon------------------------------------------------------—----------------- 1, 605. 6 16. 3 26, 170. 8 1. 01 1, 615. 8

A llo y ---------------------------------------------------------------------------- 30. 9 22. 1 651. 5 1. 30 40. 2

Stainless----------------------------------------------------------------------- 23. 6 57. 0 1, 342. 7 3. 52 82. 9

Strip— cold rolled:

C arbon------------------------------------------------------------------------- 1, 102. 6 28. 2 31, 092. 2 1. 74 1, 919. 8

A llo y ---------------------------------------------------------------------------- 26. 3 206. 3 5, 434. 1 12. 74 335. 5

Stainless----------------------------------------------------------------------- 254. 8 94. 7 24, 127. 7 5. 85 1,489. 7

Sheets— all other coated:

Ca. r bon — —— — —————— — — — — — — — —— — ---- 512. 3 16. 3 8, 351. 2 1. 01 515. 6

E lectrical sheets and strip:

C arbon------------------------------------------------------------------------- 52. 6 28. 5 1, 498. 2 1. 76 92. 5

A llo y ---------------------------------------------------------------------------- 595. 0 31. 5 18, 741. 6 1. 94 1, 157. 2

1 = °* 061742388‘

2 There were no net shipments of coke from the industry; there was a net purchase of about 2. 9 m illion tons.

3 Pig iron shipments outside the steel industry.

4 Includes structural pipe and tubing.

5 12 tons of stainless and 1 ton of alloy.

NOTE: Because of rounding, sums of individual items may not equal totals.

SOURCE: Shipments from the Annual Statistical Report. 1964 (New York, Am erican Iron and Steel Institute, 1965).

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T a b le B ~ 3. U n ited S t a t e s . E s t im a t e o f S u p p le m e n ta r y B e n e fit s f o r S a la r ie d E m p lo y e e s ,

I r o n an d S t e e l I n d u s tr y , 1964

(In U. S. dollars)

Item

A. AISI financial data: 1

1. Employee exclusive of force account labor: 2

Total employment cost -----------------------------------------------------------

Wages and salaries--------------------------------------------------------------

Supplementary b en efits------------------------------------------------------

Social security taxes------------------------------------------------------

Pensions----------------------------------------------------------------------------

Insurance -------------------------------------------------------------------------

Savings and vacation type plans-----------------------------------

Supplemental unemployment c o s ts -----------------------------

Other employment costs-------------------------------------------------

2. Employee inclusive of force account labor: 3

Wages---------------------------------------------------------------------------------------

Salaries ----------------------------------------------------------------------------------

Cost

(15, 11 percent of total) —

6, 136, 131, 495

"5, 208, 825, 331

927, 306, 164

220, 064, 672

192, 701, 125

227, 756, 802

186, 582, 102

42, 758, 863

57, 442, 600

(72, 11 percent of total) —

(27. 89 percent of total) —

5, 306, 617, 587

3, 826, 620, 752

1, 479, 996, 835

B. AISI employment and wage data for the "steel industry":

. Annual payroll c o s t ----------------------------------------------------------------

Wages --------------------------------------------------------------------------------------

Salaries ------------------------------------------------------------------------------------

. Hourly employment cost for wage earners, total

Payroll cost------------------------------------------------------------------

Pay for hours worked 4 ---------------------------------------

Pay for holidays not worked, vacation pay, and

adjustments ----------------------------------------------------------------

Supplementary benefits included under A - l -----------------

— (92. 73 percent of payroll

cost; 78. 78 percent of

total employment cost).

----(7. 27 percent of payroll

cost).

----(15. 04 percent of total

employment cost).

4, 376, 121, 495

3, 217, 048, 623

1, 159, 072, 872

4. 335

3. 700

3. 431

. 269

. 655

C. Estimate of fringe benefits, assuming percentages in A -2 and B -2 apply

to figures under A - l :

Wages = 7 2. 11 percent of $ 5, 208, 825, 331 --------------------------------------------------------------------------

Salaries =$5, 208, 825, 331 - $3, 756, 083, 924 --------------------------------------------------------------------------

Total employment cost:

W age e a r n e r s - $ 3, 7 56, 08 3, 9 24-h( 1 - 0. 1 504) ---------------------------------------------------------

Salaried employees - $6, 1 36, 131, 495 -$ 4 , 421, 000, 896 -------------------------------------------------

Supplementary benefits (included under A -l) for salaried employees:

S 1, 71 5, 130, 599 - $ 1, 452, 741, 407 ----------------------------------------------------------------------------------------

As a percent of total employment cost for salaried em ployees-----------------------------------

3, 756, 083, 924

1, 452, 741, 407

4, 421, 000, 896

1, 715, 130, 599

262, 389, 192

IEi. 30

D. Estimated cost of pay for holidays not worked,

adjustments for salaried employees (based 01 

earners) as a percent of payroll cost for sala

acation pay, and

same percentage for wage

led employees-----------------------

1 Covering the consolidated statements, including all of the affiliated interest

companies which report these data to the AISI.

2 Excludes portion of payroll charged to own construction or other nonoperating

3 Includes portion of payroll charged to own construction or other nonoperating

4 Equivalent to BLS "average hourly earnings" and ECSC "salaire d ire c t."

ts of the parent

accounts.

accounts.

SOURCE: Based

Steel Institute. 1966).

data from the Annual Statistical Report, 1965 (New York, American Iron and

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T a b le B ~ 4 . U n ited S t a te s . E m p lo y m e n t C o s t f o r W a g e E a r n e r s and S a la r ie d E m p lo y e e s ,

I r o n and S t e e l I n d u s tr y , 1964

Wage earr

Wages

Total c

Worker catego

2, 983, 072, 760

3, 786, 441, 816'

Salaried employees :

Salaries 3 ------------

Total cost 4 ---------

1, 074, 805, 055

1, 368, 420, 01 1

Wage earners and salaried employees:

Wages and salaries------------------------------------------------------------------------------------------------------------------------- 4,

Total c o s t----------------------------------------------------------------------------------------------------------------------------------------- 5,

057, 877, 815

154, 861, 827

1 Pay for hours worked, AISI. Includes shift differentials and premiums for overtime and

Sun4ay and holiday work.

2 Includes wages plus pay for holidays not worked, vacation pay, adjustments, and all fringe

benefits listed in table B—3.

3 Estimated to be 92.7 3 percent of total payroll cost (i. e. , AISI "s a la rie s "). (See table B ~3. )

Pay for holidays not worked, vacation pay, and adjustments are thus excluded.

4 Estimating that AISI salaries are 84.7 0 percent of total employment cost for salaried employees.

See table B~3.

Table B~5. United States. Total Hours

Iron and Steel

Worked and Average Hourly Laboi

Industry, 1964

Cost,

Worker category Total hours worked

869, 447, 030

Salaried employees-----— ---------------------------------------------------------------------------------------------------------------------- 2 44 ,6 58 ,3 83

1, 114, 105, 413

Hourly labor cost

$3. 431

4. 355

4. 393

5. 593

3. 642

4. 627

Wage earners and salaried employees ---------------- - -— —----------------- ------— - -------

Wage earners:

Totai°-'o^t>UrS W° rked

Sa. la. ried employee s ;

T^^nT^c ~t 1 234

Wage earners and salaried employees:

^ at8^S-anf salaries

1 Aggregate salary cost from table B—4 divided by total hours worked by salaried employees.

2 Total employment cost for salaried employees from table B—4 divided by total hours worked

by salaried employees.

SOURCE: Based on data from the Annual Statistical Report, 1965 (New York, American Iron and

Steel Institute, 1966).

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T a b le B ~ 6 . U n ite d S t a t e s . C a lc u la tio n o f U n it L a b o r C o s t f o r W a g e E a r n e r s and

S a la r ie d E m p lo y e e s , I r o n and S t e e l I n d u s tr y , 1964

Worker category Employment cost

(U. S. d o lla rs)1

Output

(thousands

of short ton s)2

Unit

cost (U. S. d<

labor

ollars) per—

Short ton 3 Metric ton 4

(1) (2) (3) (4)

Wage earners:

Wages -............ ........ -.................... 2, 983, 072, 760 87, 716. 3 34. 01 37. 49

Total c o s t -------------------------------------- 3, 786, 441, 816 87, 716. 3 43. 17 47. 59

Salaried employees:

Salaries ----------------------------------------- 1, 074, 805, 055 87, 716. 3 12. 25 13. 51

Total c o s t-------------------------------------- 1, 368, 420, 01 1 87, 716. 3 15.60 17. 20

Wage earners and salaried

em ployees:

Wages and salaries--------------------- 4, 057, 877, 815 87, 716. 3 46. 26 50. 99

Total c o s t-------------------------------------- 5, 154, 861, 827 87,716. 3 58. 77 64. 78

1 From table B~3.

2 Weighted output from table B~2.

3 Col. 14-col. 2.

4 1 metric ton = 1. 1023 short tons.

Table B—7. United States. Man-Houri

Iron and Ste<

: per Ton and Output p<

il Industry, 1964

000 Man-Hours,

Worker category

Man-hours per— 1

Short ton Metric ton 2

9. 91

2. 79

12. 70

10. 93

3. 07

14. 00

Wage earners

Wage earners and salaried employees ----------------------------------------------------

Output per 1, 000 man-hours 1

Short tons Metric tons 2

100. 89

358.53

78. 73

91- 53

325. 26

Wage earners and salaried em p lo y ees---------------------------------------------------- 71. 42

Using output from table B—2 and hours worked from table B—5.

1 m etric ton = 1. 1023 short tons.

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Table B—8. Franee. Estimate of Minimum and Maximum Weighted Output, 

Iron and Steel Industry, U. S. Industry D efinition,1 1964

fin thousands of m etric tons)

Product category

Minimum Maximum

Production

distribution

emphazing

low-weight

products

Weight Weighted

output

Production 

distribution 

emphazing 

high-weight 

products

Weight Weighted

output

All product categories ------------------------- 16.994 15,628.5 16,994 17,306.3

C oke----------------------------------------------------------------- , (2) 0 . 06 (2) 0 . 06

Pig iron and fe rro a llo y s--------------------------------- 3 1,277 . 13 166. 0 3 1,277 . 13 166. 0

Ingots and steel for castings:

Carbon-------------------------------------------------------- 4 300 . 2 0 60. 0 4 100 . 2 0 2 0 . 0

Alloy------------------------------------------------------------ 4 5 100 . 27 27. 0 4 5 50 . 27 13. 5

S ta in less---------------------------------------------------- 4 525 .45 11. 3 (4 5 ) .45 -

Bloom s, slabs, billets, tube rounds,

skelp, etc:

Carbon-------------------------------------------------------- 4 598 . 57 340. 9 4 798 . 57 454. 9

Alloy------------------------------------------------------------ 4 525 1. 09 27. 3 4 5 125 1. 09 136. 3

S ta in less---------------------------------------------------- 4 525 2. 15 53. 8

(4 5) 2. 15 -

Wire rods:

Ca rbon-------------------------------------------------------- 6 1,0 10 . 80 808. 0 6 1 ,010 . 80 808. 0

Alloy------------------------------------------------------------ 5 625 1. 67 41.8 5 616 1. 67 26. 7

Stainless ----------------------------------------------------

5 6 j 6 . 06 6 . 1 5 610 6 . 06 60. 6

Structural shapes (heavy) and steel piling:

Carbon-------------------------------------------------------- 7 957 .71 679. 5 7 1,030 .71 731. 3

Alloy------------------------------------------------------------ 573 1.49 108. 8 (5) 1.49 _

Stainless ---------------------------------------------------- - 5. 85 - 5. 85 _

Plates:

Carbon-------------------------------------------------------- 8 1,197 . 67 802. 0 8 1,197 . 67 802. 0

Alloy------------------------------------------------------------ 532 1.43 45. 8 539 1.43 55. 8

S ta in less--------------------------------------------------- - 5 30 5. 60 168. 0 523 5. 60 128. 8

Rails, standard and all other:

Carbon-------------------------------------------------------- 9 323 . 70 226. 1 9 323 . 70 226. 1

Alloy------------------------------------------------------------ - 1. 56 - - 1. 56 -

Joint bars, tie plates, and track spikes:

Carbon-------------------------------------------------------- 10 30 1.46 43. 8 1030 1.46 43. 8

Wheels and axles:

Carbon-------------------------------------------------------- 11 37 1. 90 70. 3 1137 1. 90 70. 3

Alloy------------------------------------------------------------ - 2 . 9 0 - - 2 . 90 -

B ars— hot rolled (including light shapes):

Carbon-------------------------------------------------------- 12 1, 842 .94 1, 731.5 121 , 769 . 94 1 , 662. 9

Alloy------------------------------------------------------------ 5 130 1.47 191. 1 5 183 1.47 269. 0

Stainless ---------------------------------------------------- (5 ) 7. 18 - 5 2 0 7. 18 143. 6

Bars— reinforcing:

Carbon-------------------------------------------------------- 13 1 , 239 . 6 8 842. 5 13 1,239 . 6 8 842. 5

Alloy------------------------------------------------ ----------- - 1.44 - - 1.44 _

Bars— cold finished:

Carbon-------------------------------------------------------- 14 209 1.44 301. 0 14 209 1.44 301. 0

Alloy------------------------------------------------------------ 15 29 2.43 70. 5 is 1 9 2. 43 46. 2

Stainless ----------------------------------------------------

5 5 £ 10. 27 20. 5 5 1 2 10. 27 123. 2

B ars— tool steel:

Carbon-------------------------------------------------------- 16 1 0 5. 81 58. 1 16 1 0 5. 81 58. 1

Alloy------------------------------------------------------------ 17 36 10.45 376. 2 17 36 10. 45 376. 2

Standard pipe:

Carbon-------------------------------------------------------- 18 497 1 . 26 626. 2 18 414 1 . 26 521.6

Alloy------------------------------------------------------------ 5 2 1. 73 3. 5 (5 ) 1.73 _

Stainless ---------------------------------------------------- - 8 . 13 - 8 . 13 -

Oil-country goods:

Carbon-------------------------------------------------------- 18 125 1. 53 191. 3 18 219 1. 53 335. 1

Alloy------------------------------------------------------------ 5 1 0 2 . 1 2 2 1 .2 5 18 2 . 1 2 38. 2

Stainless ---------------------------------------------------- ( 5 ) 10. 35 - 5 4 10. 35 41.4

Line pipe:

Carbon-------------------------------------------------------- 18 334 1 . 1 2 374. 1 18 155 1 . 1 2 173. 6

Alloy------------------------------------------------------------ 5 30 1. 72 51.6 5 6 1.72 10. 3

M echanical tubing:

Carbon-------------------------------------------------------- 18 213 2. 31 492. 0 18 319 2. 31 736. 9

Alloy------------------------------------------------------------ 5 7 3.46 24. 2 s 19 3. 46 65. 7

Stainless ---------------------------------------------------- ( 5 ) 18. 33 - 5 4 18. 33 73. 3

P ressure tubing:

Carbon-------------------------------------------------------- (18) 3. 17 -

is 5 4 3. 17 171. 2

Alloy------------------------------------------------------------ ( ) 5. 18 - 5 2 5. 18 10.4

Stainless ---------------------------------------------------- ( 5 ) 18. 93 - 5 4 18. 93 75. 7

Wire— drawn:

Carbon-------------------------------------------------------- 14408 1.75 714. 0 14 408 1.75 714. 0

Alloy------------------------------------------------------------ 15 12 2 . 8 8 34. 6 15 4 2 . 8 8 11. 5

Stainless ---------------------------------------------------- 5 2 10. 54 2 1 . 1 5 1 0 10. 54 105.4

See footnotes at end of table.

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Table B—8. F rance. Estimate of Minimum and Maximum Weighted Output, 

Iron and Steel Industry, U. S, Industry D efinition,1 1964— Continued

(In thousands of m etric tons)

Product category

Minimum Maximum

Production

distribution

emphazing

low-weight

products

Weight Weighted

output

Production 

distribution 

emphazing 

high-weight 

products

Weight Weighted

output

Wire products:

Carbon---------------------------------------------------------- 144 10 2. 22 910. 2 14410 2. 22 910. 2

Stainless ------------------------------------------------------- 15 1 10. 80 10. 8 15 1 10. 80 10. 8

Black plate:

Carbon---------------------------------------------------------- 13 18 . 94 16. 9 13 18 .94 16.9

Tin and terne plate— hot dipped:

Carbon---------------------------------------------------------- 19 156 1.47 229. 3 19 3 12 1.47 458. 6

Tin plate— electrolytic:

C arbon---------------------------------------------------------- 19469 1. 08 506. 5 19 313 1. 08 338. 0

Sheets— hot rolled:

Carbon---------------------------------------------------------- 20 1, 066 .59 628. 9 20 371 .59 218. 9

Alloy------------------------------ --------- ---------------------- 5 25 1. 14 28. 5 5 23 1. 14 26. 2

Stainless ------------------------------ ------------------------ 5 23 1.78 40. 9 5 7 1. 78 3. 6

Sheets— cold rolled:

Carbon----------------------------------------------------------- 20 2 , 2 7 9 . 73 1,663. 7 20 2 , 9 7 4 . 73 2, 171. 0

Alloy---------- --------------------------------------------------- 5 2 1. 30 2. 6 < (5) 1. 30 -

Stainless ------------------------------------------------------- 5 10 6. 76 67. 6 5 30 6. 76 202. 8

Sheets— galvanized:

Carbon----------------------------------------------------------- 21 445 .94 418. 3 21 445 . 94 418. 3

Alloy-------------------------------------------------------------- - 1.61 - - 1. 61 -

Strip— hot rolled:

Carbon----------------------------------------------------------- 22 425 1. 01 429. 3 22 4 3 3 1. 01 437. 3

Alloy-------------------------------------------------------------- 5 2 1. 30 2.6 1. 30 -

Stainless ------------------------------------------------------- 5 6 3. 52 21. 1 (5 ) 3. 52 -

Strip— cold rolled:

Carbon----------------------------------------------------------- 14 181 1.74 314. 9 14 181 1.74 314. 9

Alloy-------------------------------------------------------------- 15 2 12. 74 25. 5

C 5 >

12. 74 -

Stainless — ------------------------------ -------------------- 5 4 5. 85 23.4 3 6 5. 85 35. 1

Sheets— all other coated:

Carbon —----- -------------------------------------------------- 21 61 1. 01 61.6 21 61 1. 01 61.6

E lectrical sheets and strip:

Carbon----------------------------------------------------------- 23 41 1.76 72. 2 (23) 1. 76 _

Alloy-------------------------------------------------------------- 23166 1.94 322. 0 23 207 1. 94 401. 6

1 Includes the following product categories not included in the European Coal and Steel Community (ECSC) industry 

definition (equivalent to the French definition): Wheels and axles; pipe and tubing (all varieties); wire— drawn; wire products; 

strip— cold rolled; and bars— cold finished.

It has been assumed that wheels and axles derive from sem is and ingots; seam less pipe from sem is and ingots; welded 

pipe from h ot-rolled strip (partially skelp, following U. S. definition); wire and wire products from wire rods; cold -rolled 

strip from h ot-rolled strip; and cold-finished bars from hot-rolled bars (including light shapes). In order to avoid double counting, 

shipments figures minus shipments for conversion into other steel products, instead of production figures, have been used 

for sem is and ingots, hot-rolled strip, and wire rods. A yield loss has been allowed from h ot-rolled bars to cold-finished bars.

2 All coke produced by the steel industry is assumed to be consumed by the industry, since consumption totaled 

14, 330 thousand m etric tons (hereafter referred to as MMT) and industry production 4, 323 MMT.

3 Production of pig iron and ferroalloys (15,840 MMT) minus consumption (14, 563 MMT) in steelmaking p rocesses.

4 Derived from United Nations shipments data (Quarterly Bulletin of Steel Statistics for Europe, vol. XV, No. 4). 

Source lists shipments of sem is and ingots, other than for conversion into other steel products, totaling 1, 073 MMT, of 

which 175 MMT are alloy. On the minimum output side, 425 MMT are assumed to be ingots and 648 MMT, sem is; on the 

maximum output side, 150 MMT are assumed to be ingots and 923 MMT, sem is.

5 The distribution of alloy steel, including stainless, among end products has been made on the basis of the following data:

Special crude steel

Alloy t o o l--------------------------------------------------------------

High speed-------------- ----------------------------------------------

Carbon to o l-----------------------------------------------------------

S ta in less--------- -------------- --------------------------------------

SOURCE: Metal Bulletin, Mar. 16, 1966.

Production 

(thousands of 

m etric tons)

42.7 

8 . 1 

16.9 

234.5

Shipments 

(thousands of

Alloy, including stainless m etric tons)

Group A:

Solids for seam less tubes-------------------------------------- 52

Other ingots and sem is ----------------------------------------- 175

Sections, hot rolled (including b a rs )-------------------- 273

Wire ro d s—------------------------------------------------------------- 41

Strip, hot r o lle d ---------------------------------------------------- 22

Plates (3 m m. or m o r e )--------------------------------------- 62

Sheets (less than 3 m m .)--------------------------------------- 60

(Continued on follow in g page)

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Table B~8. Footnotes— Continued

Shipments 

(thousands of

Alloy, including stainless m etric tons)

Group B:

Wire-— drawn----------------------------------------------------------- 14

Wire products -------------------------------------------- 1

Bars— cold finished ---------------------------------------------- 31

Strip— cold r o lle d ----- -------------- 6

SOURCE: Group A, from Quarterly Bulletin of Steel Statistics 

for Europe (New York, United Nations Econom ic Com m ission for 

Europe), vol. XV, No. 4; and group B, from Annuaire de Statistique 

Industrielie, 1965 (P aris, Bureau Central de Statistique Industrielle).

From the above data, two distributions of alloy steel, including stainless, have been made; the first em phasizes lowweight products, and the second, high-weight products, as follow s:

Minimum output Maximum output 

Product category ______ (thousands of m etric tons)

Ingots and steel for ca stin g s -------------------------

Bloom s, stabs, billets, tube rounds,

skelp, e tc ------------------------------------------------------

Wire products -------------------------------------------------

Wire— drawn---------------------------------------------------

Bars— cold finished----------------------------------------

Strip— hot rolled ---------------------------------------------

Strip— cold r o lle d -------------------------------------------

Pipe and tubing------------------------------------------------

Bars— tool s t e e l---------------------------------------------

Bars— hot rolled (including light shapes)-----

Structural shapes (heavy ) and steel p ilin g----

P la tes--------------------------------------------------------------

Sheets— cold r o lle d ----------------------------------------

Sheets— hot rolled -------------------------------------------

Wire ro d s --------------------------------------------------------

125 50

50 125

1 1

14 14

31 31

a/8 (_&/)

6 6

b/49 _b/57

c/36 c /36

d/130 d/203

d/7 3 (d /)

62 62

12 30

48 30

_e/26 _e/2 6

_a/ The hot-rolled strip total of 22 required to make the cold-roiled strip 

is estimated at 1.09 x 6 = 7. On the minimum side, 7 MMT are assumed to go 

into making pipe, and on the maximum side, 15 MMT.

Jb/ The amount of pipe and tubing made from the shipments of solids for 

seam less tubes is estimated at 52-^1.22 = 43. The amount made from strip is 

estimated at 7 M.10 - 6 on the minimum side and 15M.10 = 14 on the maximum side.

_c/ Alloy tool and high-speed crude steel (50. 8) x 0.70.

_d/ The hot-rolled sections (total 273) required to make the cold-finished 

bars is estimated at 1.09 x 31 = 34. The amount in tool steel is 36 MMT.

On the minimum side, it is assumed that 73 MMT are in structural shapes 

(heavy), and on the maximum side, that no alloy is in this category.

_£./ Shipments of wire rods minus the estimated requirement to make wire 

and wire products (1.03 x 15).

The alloy in pipe and tubing has been distributed among the various categories on the minimum and maximum sides as 

follow s:

Minimum output Maximum output 

Pipe and tubing (thousands of m etric tons)

T o ta l-------------------------------------------------------- 49 57

Standard pipe ----------------------------------------------------- 2

O il-country goods---------------------------------------------- 10 22

Line p ip e----------------------------------------------------------- 30 6

M echanical tubing---------------------------------------------- 7 23

P ressure tubing------------------------------------------------ - 6

Stainless steel in end products is assumed to total 129 MMT on the minimum side (234 times an average yield from 

crude steel of 0.55) and 152 MMT (234 x 0.65) on the maximum side. It has been estimated that 50 percent of the total, on 

both sides, is in plates and sheets (based on data in La reconversion de la mine de Chapagnac, Luxembourg, ECSC, 1964), 

Within this fram ework, distributions have been made to emphasize low-weight products on the minimum side and high-weight 

products on the maximum side, as follow s:

Minimum Maximum Minimum Maximum

Product category output output Product category— Continued output output

(thousands of m etric tons) (thousands oi m etric tons)

All categories-------------- 129 152 B ars— cold finished------------ 2 12

O il-country goods -------------- - 4

Ingots and steel for M echanical tubing -------------- - 4

castings---------- ------------------ 25 P ressure tubing----------------- - 4

Bloom s, slabs, billets, W i r e— drawn----------------------- 2 10

tube rounds skelp, Wire products------------------— 1 1

etc---—-.—---------------------------- 25 5 Sheets— hot rolled ------------- 23 7

Wire rod s --------------------------- 1 10 Sheets— cold rolled —--------- 10 30

P lates---------------------------------- 30 39 Strip— hot rolled --------- -----— 6 -

Bars— hot rolled ----------------- - 20 Strip— cold r o lle d -------------- 4 6

(C on tin u ed on fo llo w in g p a g e )

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Table B~8. Footnotes— Continued

6 United Nations shipments figure minus the amount for conversion into other steel products.

7 Production figure as given (ECSC) minus the estimated amount in alloy.

8 Production figure as given (ECSC) for large plates plus plates over 4. 75 mm. minus the estimated amount in alloy.

9 Production figure as given (Annuaire de statistique industrielle). Includes rails and sleepers.

10 Production figure as given (Annuaire de statistique industrielle). Includes joint bars and tie plates.

11 Production figure as given (ECSC). Includes wheel bands, wheels, axles, and wheel centers.

12 Production figure as given (ECSC) minus the estimated quantity in alloy and in cold-finished bars and tool steel.

13 Production figure as given (ECSC).

14 Shipments figure as given (Annuaire de statistique industrielle).

15 Shipments figure as given (Annuaire de statistique industrielle) minus the estimated amount in stainless steel.

16 Crude steel figure (Metal Bulletin, Mar. 18, 1966) times 0.70.

17 Crude steel figure (Metal Bulletin, Mar. 18, 1966) times 0. 60.

18 The Chambre Syndicale des Fabricants de Tubes d 'A cier recorded total pipe and tubing production of 1,218 MMT in 

1964. Of this amount, at least 330 MMT were in standard pipe, 220 MMT in m echanical tubing, 130 MMT in line pipes, 

and 7 0 MMT in oil-country goods. Within this fram ework, estimates of the distribution of pipe and tubing among the various 

categories have been made as follow s:

Minimum Maximum

output output

Pipe and tubing (thousands of m etric tons)

Standard p ip e ------

Oil-country goods.

Line p ip e--------------

Mechanical tubing 

P ressure tubing —

499

135

364

220

414

241

161

342

60

The amount of carbon steel in any category represents the appropriate figure from above minus the estimated amount in alloy steel.

19 The ECSC production figure for all tin and terne plate is 625 MMT. On the minimum side, 25 percent has been placed 

in the hot-dipped category and 75 percent in electrolytic; on the maximum side, 50 percent has been placed in each category.

20 ECSC production figure for sheets 4.75 mm. or less (coils have been added to h ot-rolled sheets) minus the estimated 

amount used to produce coated products and electrical sheets and strip; this procedure avoids double counting. Relevant 

production figures are as follow s:

Product category

Production

(thousands of m etric tons)

Sheets— hot rolled * 4. 75 m m ------ ------------------- 1,114

Sheets— cold rolled £ 4. 75 m m ------------------------ 3, 647

Tin and terne p late-------------------------------------------- 625

Black p la te ------------------------------ 18

Galvanized sheets --------------------------------------------- 445

Other coated sh eets------------------------------------------- 61

E lectrical sheets and strip ------------ 207

Coated and electrical sheets and strip are assumed to derive from hot- and cold -rolled sheets, as follow s:

Product category

Total -

Minimum output Maximum output

(thousands of m etric tons) (thousands of m etric tons)

Cold- rolled Hot- rolled Cold- rolled Hot- rolled

sheets sheets sheets sheets

1. 356 643 713

Black p la te ---------------------------------------------------------------------------- 18

Tin and terne p la te ------------------------------------------------------------- 625

Galvanized sh eets----------------------------------------------------------------- 445

Other coated sh eets------------------------------------------------------------- 61

E lectrical sheets and strip ------------------------------------------------- 207

18

625

445 

61

207

These totals must be subtracted from the total production figures for hot- and cold-rolled sheets, and the estimated amount 

of alloy and stainless must be subtracted from this figure to arrive at the figure listed for carbon steel. No yield loss from 

hot- and cold -rolled sheets to coated sheets has been allowed.

21 Production figure as given (Bulletin de la Chambre Syndicale de la Siderurgie F rancaise).

22 United Nations shipments figure minus amount for conversion into other steel products less the estimated amount in 

alloy and stainless.

23 The production of electrical sheets and strip (207— ECSC) has been placed entirely in the alloy category on the m aximum side; on the minimum side, 20 percent has been placed in the carbon category and 80 percent in the alloy category. 

E lectrical sheets and strip are not classified as alloy steel according to French definitions, but U. S. definitions classify 

alm ost all of this product as alloy steel.

SOURCE: Siderurgie (Luxembourg, Statistical Office of the European Comm unities), 1966-No. 3; Annuaire de statistique 

industrielle. 1965 (P aris, Bureau Central de Statistique Industrielle); Quarterly Bulletin of Steel Statistics for Europe (New YorVb 

United Nations Econom ic Com m ission for Europe) vol. XV, No. 4; Bulletin de la Chambre Syndicale de la Siderurgie Francaise 

(P aris, Chambre Syndicale de la Siderurgie F rancaise), serie Rouge, No. 489; and Metal Bulletin, Mar. 18, 1966.

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T a b le B —9 . F r a n e e . E m p lo y m e n t C o s t f o r W a g e E a r n e r s and S a la r ie d E m p lo y e e s ,

E C S C I n d u s tr y D e fin it io n , I r o n an d S t e e l I n d u s t r y , 1964

ill 1£s_LL

Worker category

Wage e a rn e rs:2

Wages 3 = Cost per hour (3,77 NF 4 )

x total hours worked (2 86 .4 million

Total c o s t6 = Cost per hour (6.87 N F 4)

x total hours worked (286. 4 million

Salaried em p loyees:7

Salaries - Cost per month (1,239 N F 8 ) x 12

x salaried employment (33, 155 9 ) —

Total cost = Cost per month (2, 080 NF 10 ) x 12

x salaried employment (33, 1 55 9 )-----

Wage earners and salaried employees:

Wages and sa la ried ------------------------------

Total c o st------------------------------------------------

Cost

5).

5) .

1 ,0 7 9 ,7 2 8 ,0 0 0

1 ,9 6 7 ,5 6 8 , 000

4 9 2 ,9 4 8 ,5 4 0

8 2 7 ,5 4 8 ,8 0 0

1 ,5 7 2 ,6 7 6 ,5 4 0

2 ,7 9 5 ,1 1 6 ,8 0 0

1 US$ 1 = 4. 9 NF.

2 Includes workers engaged prim arily in manual tasks; excludes nonmanual workers such as

foremen under any method of payment.

3 Pay for time worked, at hourly and piece rates, including premiums for overtim e, hazardous

work, etc. , cost-of-living allowances, and payment for excused absence for attendance at union meetings.

4 From Salaires CECA.

5 From Siderurgie.

6 Wages ("salaire d irect") plus bonuses (including productivity bonuses), holiday and vacation

pay, social security payments, payment in kind, and other employment costs.

7 Includes all nonmanual workers except corporation presidents.

8 The ECSC (Salaires CECA) figure for monthly monetary remuneration (1,475 NF) includes bonuses

and holiday and vacation pay. These items account for approximately 16 percent of the monetary remuneration of wage earners. The same percentage is estimated to apply to salaried employees and

has been subtracted from the ECSC.figure in order to attain comparability between "w a g es" and "sa la rie s. "

9 Salaires CECA indicates that 20. 3 percent of total employment is salaried. Average annual

wage earner employment from Siderurgie (130,169) divided by 0.797 yields a total employment of

163, 324 (or salaried employment of 33, 155).

10 Includes same employment costs as for wage earners. See footnote 6.

SOURCE: Salaires CECA, 1964, Social Statistics series, 1966-N o. 2, and Siderurgie, 1966-N o. 3

(Luxembourg, Statistical Office of the European Communities).

Table B -1 0 . Franee. Estim ates of Employment Cost for Wage Earners and Salaried Employees

to Manufacture Products Not Included in the ECSC Iron and Steel Industry

But Included in the U. S. Industry, 1 1964

(In new francs 2 )

Worker category Cost

Wage earners:

W a g es----------------------------------- --------------------------------------------------------------------------------------- -...........

Total cost, if supplementary benefits for wage earners are

between 43 and 47 percent of total employment cost: 3

M inim um ----------------------------------------------------------------------------------------------------------------------------

|^/f qyi m 11 pr, . ... .... ....... ... .. .... ..........

2 7 9 .5 0 0 .0 0 0

4 9 0 .3 5 1 .0 0 0

5 2 7 .3 5 8 .0 0 0

140,400, 000

2 2 6 .4 5 2 .0 0 0

2 4 2 .0 6 9 .0 0 0

4 1 9 .9 0 0 .0 0 0

7 1 6 .8 0 3 .0 0 0

7 6 9 .4 2 7 .0 0 0

Salaried employees:

Salaries -----------------------------------------------------------------------------------------------------------------------------------

Total cost, if supplementary benefits for salaried employees are

between 38 and 42 percent of total employment cost: 3

M inim um ----------------------------------------------------------------------------------------------------------------------------

Mavimnm . . . .......... ......................... . ... .

Wage earners and salaried employees:

Wages and salaries --------------------------------------------------------------------------------------------------------------

Total cost:

Minim um ----------------------------------------------------------------------------------------------------------------------------

M axim u m ---------------------------------------------------------------------------------------------------------------------------

1 Wire— drawn and wire products; pipe and tubing; wheels and axles; strip— cold rolled; and

bars— cold finished.

2 US$ 1 = 4. 9 NF.

3 Ra?.ge based on sim ilar data for the iron and steel industry as defined by the ECSC. See table B—9.

SOURCE: Figures on wages and salaries from the Institut. National de la Statistique et des Etudes

Economiques.

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(In new francs 2)

T a b le B —11. F r a n c e . E s t im a t e s o f E m p lo y m e n t C o s t f o r W a g e E a r n e r s an d S a la r ie d E m p lo y e e s ,

U .S . I n d u s tr y D e fin it io n , I r o n an d S t e e l I n d u s tr y , 19 64 1

47

Worker category Cost

Wage earners:

W ages-------------------------------------------------------------------------------------------------------------------------------------

Total cost:

1 ,3 5 9 ,2 2 8 ,0 0 0

Minimum___________________________________ _ 2 .4 5 7 .9 1 9 .0 0 0

M axim um ___________________ ________________ . ___ 2 .4 9 4 .9 2 6 .0 0 0

Salaried employees:

Salaries _______________________________ _ 6 33 ,3 48 ,5 40

Total cost:

Minimum ____________________________________________________________ ___ ___ 1 ,0 5 4 ,0 0 0 ,8 0 0

Maximum ______________ _ _ - _ . .......... . .. . ..... . . 1 ,0 6 9 ,6 1 7 ,8 0 0

Wage earners and salaried employees:

W a g p sa n iisa la r ip s.. . . . .. 1 ,9 9 2 ,5 7 6 , 540

Total cost:

Minimum____________________________ 3 .5 1 1 .9 1 9 .8 0 0

M axim um ------------------------------------------------------------------------------------------------------------------------- 3 .5 6 4 .5 4 3 .8 0 0

1 Combining figures from tables B~9 and B ~10.

2 US$ 1 = 4. 9 NF.

Table B -12. France. Estimates of Total Hours Worked, ECSC Industry Definition

and U .S . Industry Definition, Iron and Steel Industry, 1964

Industry definition and irker category Total hours worked

ECSC Industry Definition

Wage earn ers----------------------------------------------------------

Salaried employees -----------------------------------------------

Wage earners and salaried employees —

12 8 6 ,4 00 ,0 00

2 7 2 ,9 4 1 ,0 0 0

3 5 9 ,3 41 ,0 00

U. S. Industry Definition

Wage earn ers-------------------------------------------------------

Salaried employees --------------------------------------------

Wage earners and salaried employees

3 6 3 .2 86 .0 00

39 1 .901.000

4 55 .1 87 .0 00

1 From Siderurgie.

2 Based on the estimate that there are 33, 155 salaried employees (table B—9) and that they work

an average of 2,200 hours a year (derived from data of the United Nations Economic Commission for

Europe).

3 Employment of wage and salary earners related to the production of products excluded from

the ECSC definition was 34,948 and 8 ,6 1 8 , respectively, in 1964. Based on the estimate that wage

earners worked the same number of hours a year as in the ECSC steel in d u s t r y ( 2 ,2 0 0 ) an d that salaried

employees also worked 2,200 hours a year, hours worked to produce these excluded products were

76,886,000 by wage earners and 18,9 6 0,0 0 0 by salaried employees. These totals must be added to the

ECSC totals to obtain figures based on the U .S. industry definition.

SOURCE: Based on data from Siderurgie, 1966-No. 3, and Salaires CECA, 1964, Social Statistics

series, 1966-N o. 2 (Luxembourg, Statistical Office of the European Communities); and the Institut

National de la Statistique et des Etudes Economiques.

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Table B—13. F rance. Estimates of Average Hourly Labor Cost for Wage Earners and 

Salaried Em ployees, U. S. Industry Definition, Iron and Steel Industry, 1964

W orker category

Employment Hours

Average hourly 

labor cost cost (in new worked 3 francs 1 ) 2 In new 

francs 1 4 In dollars

(1) (2) (3) (4)

Wage earners:

W ages------------------------------------------------------------

Total cost:

1,359,228,000 363,286,000 3. 74 0. 76

M inimum-------------------------------------------------- 2,457,919,000 363,286,000 6. 77 1. 38

M axim um ----------- -------------------------------------- 2,494,926,000 363,286,000 6. 87 1.40

Salaried em ployees:

Salaries --------------------------------------------------------

Total cost:

633,348,540 91,901,000 6. 89 1.41

M inimum-------------------------------------------------- 1, 054,000, 800 91,901,000 11.47 2. 34

M axim um ------------------------------------------------- 1, 069, 617, 800 91,901,000 11.64 2. 38

Wage earners and salaried em ployees:

Wages and salaries --------------------------------------

Total cost:

1,992,576,540 455,187,000 4. 38 .89

M inim um -------------------------------------------------- 3,511,919,800 455, 187, 000 7. 72 1. 57

M axim um ------------------------------------------------- 3,564,543,800 455, 187, 000 7. 83 1.60

1 US$ 1 = 4. 9 NF,

2 From table B ~ ll.

3 From table B—12.

4 Col. 1 col. 2.

Table B—14. Franee. Calculation of Unit Labor Cost for Wage Earners and 

Salaried Em ployees, Iron and Steel Industry, 1964

Employment 

cost (in new 

francs 1 ) 2

Weighted 

output 

(thousands 

of m etric 

tons 3 )

Unit labor cost

W orker category M etric tons 3 Short tons 3

In new 

francs 1 4 In dollars In new 

francs 1 4 In dollars

Wage earners: 

W ages:

(1) (2) (3) (4) (5) (6)

M inimum-------------------------------------------------- 1,359,228,000 16,676.9 81. 50 16. 63 73. 94 15. 09

M axim um -------------------------------------------------

Total cost:

1,359,228,000 15,628.5 86. 97 17. 75 78. 90 16. 10

M inim um -------------------------------------------------- 2,457,919,000 16,676.9 147.38 30. 08 133.70 27. 29

M axim um ---------------------------------------------- --

Salaried em ployees:

Salaries:

2,494,926,000 15,628.5 159.64 32. 58 144.83 29. 56

M inim um -------------------------------------------------- 633,348,540 16,676.9 37. 98 7.75 34. 46 7. 03

M axim um -------------------------------------------------

Total cost:

633,348,540 15,628.5 40. 53 8. 27 36. 77 7. 50

M inim um -------------------------------------------------- 1,054,000,800 16,676.9 63. 20 12. 90 57. 34 11. 70

M axim um -------------------------------------------------

Wage earners and salaried em ployees:

Wages and salaries:

1,069,617, 800 15,628.5 58.44 13. 97 62. 09 12. 67

M inimum-------------------------------------------------- 1,992,576,540 16,676.9 119.48 24. 38 108.39 22. 12

M axim um -------------------------------------------------

Total cost:

1,992,576,540 15,628.5 127.50 26. 02 115.67 23. 61

M inimum-------------------------------------------------- 3,511,919,800 16,676.9 210.59 42. 98 191.05 38. 99

M axim um ----------------------------------- ------------- 3,564,543,800 15,628.5 228.08 46. 55 206.91 42. 23

1 US$1 = 4. 9 NF.

2 From table B—11.

3 1 short ton = 0. 9072 m etric ton, or 1 m etric ton = 1.1023 short tons.

4 Col. 1 -f col. 2.

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T a b le B—15. F r a n e e . M a n -H o u rs p e r T on and O utput p e r 1 ,0 0 0 M a n -H o u r s , Iro n and S te e l In d u stry , 1964

Calculation of man -hours per ton

Worker category Hours

Weighted

output M an-hours per ton

worked 1 (thousands of 

m etric tons 2 3) M etric ton 2 3 Short ton 2

(1) (2) (3) (4)

Wage earners:

M inimum--------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

363.286.000

363.286.000

16,676.9 

15,628.5

21. 78 

23. 24

19. 76 

21. 08

Salaried em ployees:

Minimum--------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

91,901, 000 

91,901,000

16,676.9 

15,628.5

5. 51 

5. 88

5. 00 

5. 33

Wage earners and salaried em ployees:

M inimum---------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

455.187.000

455.187.000

16,676.9 

15, 628.5

27. 29

29. 13

24. 76 

26. 43

Calc:ulation of output per 1, 000 man-hours

Weighted

output Hours Output per 1, 000 m an-hours

(thousands of 

m etric tons 2 )

worked 1 M etric tons 2 3 Short tons 2

(1) (2) (3) (4;

Wage earners:

M inimum--------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

15,628.5 

16,676.9

363.286.0

363.286.0

43. 02 

45. 91

47. 42 

50. 61

Salaried em ployees:

Minimum--------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

15,628.5 

16,676.9

91.901.0

91.901.0

170. 06 

181.47

187.46 

200.03

Wage earners and salaried em ployees:

M inimum--------------------------------------------------------------------------

M axim um -------------------------------------------------------------------------

15,628.5 

16,676.9

455, 187.0 

455, 187.0

34. 33 

36. 64

37. 85 

40. 39

1 From table B~ 12.

2 1 short ton = 0. 9072 m etric ton, or 1 m etric ton = 1.1023 short tons.

3 Col. 1 F col. 2.

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T a b le B —16. G e rm a n y (F e d e r a l R e p u b lic ). E s tim a te o f M in im u m and M a x im u m W e ig h te d O utput,

Iro n and S te e l In d u s try , U. S. In d u stry D e fi n i t i o n ,1 1964

,£injdiousi3snds>_ofj2aet^

Minimum Maximum

Product category

Production

distribution

emphazing

low-weight

products

Weight Weighted

output

Production 

distribution 

emphazing 

high-weight 

products

Weight Weighted

output

All product c a te g o rie s---------------------------- 30,555 27.783.27 30,555 31,797.03

C oke------------------------------------------------------------------- (2) 0. 06 _

(2) 0. 06

Pig iron and ferroa lloy s ----------------------------------- 3 2 ,Z08 . 13 287.05 3 2, 208 . 13 287.05

Ingots and steel for castings:

Carbon----------------------------------------------------------- 4 1, 014 

4 * 290

. 20 202.08 4 664 . 20 132.80

Alloy-------------------------------------------------------------- . 27 78. 30 4 5 90 . 27 24. 30

Stainless ------------------------------ ------------------------ 4 5 34 .45 15. 30 4 5 34 . 45 15. 30

B loom s, slabs, billets, tube rounds, 

skelp, etc:

Carbon----------------------------------------------------------- 4 1,639 . 57 934.23 4 2, 240 

4 5 528

. 57 1,276.80

Alloy-------------------------------------------------------------- 4 5 482 1. 09 525.38 1. 09 575.52

Stainless ------------------------------------------------------- 4 5 97 2. 15 208.55 (4 5) 2. 15 -

Wire rods:

Carbon----------------------------------------------------------- 6 8 15 . 80 625.00 6 8 15 . 80 625.00

Alloy--------------------------------------------------------------

5 641 1.67 68. 47 5 6 41 1. 67 68. 47

Stainless ------------------------------------------------------- (5 6) 6. 06 -

(5 ) 6.06 -

Structural shapes (heavy) and steel piling:

Carbon----------------------------------------------------------- 7 2, 022 .71 1,435.62 7 2,187 .71 1,552.77

Alloy-------------------------------------------------------------- 5 165 1.49 245.85 (5) 1.49 -

Stainless ------------------------------------------------------ - 5. 85 - - 5. 85 -

Plates:

Carbon----------------------------------------------------------- 8 3,617 . 67 2,423. 39 8 3,617 . 67 2,423.39

Alloy-------------------------------------------------------------- 5 58 1.43 82. 94 5 56 1.43 80. 08

Stainless ------------------------------------------------------- (5) 5. 60 - 5 2 5. 60 11. 20

R ails, standard and all other:

Carbon----------------------------------------------------------- 9 466 . 70 326.20 9 466 .70 326.20

Alloy-------------------------------------------------------------- - 1. 56 - - 1. 56 -

Joint bars, tie plates, and track spikes:

Carbon----------------------------------------------------------- 10 5 0 1.46 73. 00 10 50 1.46 73. 00

Wheels and axles:

Carbon----------------------------------------------------------- ( " ) 1.90 -

(H ) 1. 90 -

Alloy-------------------------------------------------------------- - 2. 90 - 2. 90 -

Bars— hot rolled (including light shapes):

12 3, 299 

5 297

12 2, 983 

5 456

Carbon----------------------------------------------------------- . 94 3,101.06 .94 2,804.02

Alloy-------------------------------------------------------------- 1.47 436.59 1.47 670. 32

Stainless ------------------------------------------------------- 5 3 7. 18 21. 54 5 10 7. 18 71.80

Bars— reinforcing:

Carbon----------------------------------------------------------- 13 1,636 . 68 1, 112.48 131,636 . 68

t\j

00

Alloy-------------------------------------------------------------- - 1.44 - - 1.44 -

B ars— cold finished:

Carbon----------------------------------------------------------- 13 638 1.44 918.72 13 538 1.44 774.72

Alloy-------------------------------------------------------------- (?) 2.43 - 5 60 2.43 145.80

Stainless ------------------------------------------------------- (5) 10. 27 - 5 40 10. 27 410. 80

Bars— tool steel:

Carbon----------------------------------------------------------- (14) 5.81 -

(14) 5. 81 _

Alloy-------------------------------------------------------------- (5 ) 10. 45 - 5 150 10. 45 1,567.50

Standard pipe:

Carbon----------------------------------------------------------- 15 1, 150 1. 26 1,449.00 15 517 1. 26 651.42

Alloy_________________________________________ (?) 1.73 -

(?) 1.73 -

Stainless ------------------------------------------------------- (5 ) 8. 13 -

(5 ) 8. 13 -

Oil-country goods:

Carbon---------------------------------------------------------- 15 300 1.53 459.00 15 780 1. 53 1, 193.40

Alloy-------------------------------------------------------------- (5 ) 2. 12 - 5 10 2. 12 21. 20

Line pipe:

Carbon----------------------------------------------------------- 15 1, 149 1. 12 1,286.-88 15 517 1. 12 579.04

Alloy-------------------------------------------------------------- (5 ) 1.72 -

(5) 1. 72 -

M echanical tubing:

Carbon----------------------------------------------------------- 15 124 2. 31 286.44 15 643 2. 31 1,485.33

Alloy-------------------------------------------------------------- (?) 3. 46 - 5 11 3. 46 38. 06

Stainless ------------------------------------------------------- (5 ) 18. 33 -

(5 ) 18. 33 (5)

P ressure tubing:

Carbon----------------------------------------------------------- o3. 17 - 15 237 3. 17 751.29

Alloy-------------------------------------------------------------- (?) 5. 18 - 5 3 5. 18 15. 54

Stainless ------------------------------------------------------- (5 ) 18. 93 - 5 5 18. 93 94. 65

Wire— drawn:

Carbon----------------------------------------------------------- 16 205 1.75 358.75 16 210 1.75 367.50

Alloy-------------------------------------------------------------- 5 105 2. 88 302.40 5 55 2. 88 158.40

Stainless ------------------------------------------------------- 5 25 10. 54 263.50 5 70 10. 54 737.80

See footnotes at end of table.

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T a b le B —16. G e rm a n y ( F e d e r a l R e p u b lic ). E s tim a te o f M in im u m and M a x im u m W eig h te d O utput,

Iro n and S te e l In d u s try , U. S. In d u stry D e fi n i t i o n ,1 1964— C on tin u ed

(In thousands of m etric tons)

Product category

Minimum Maximum

Production 

distribution 

emphazing 

low-weight 

products

Weight Weighted

output

Production 

distribution 

emphazing 

high-weight 

products

W eight Weighted

output

W ire products:

C arbon---------------------------------------------------------- 17 1, 285 2. 22 2, 852. 70 17 1,280 2. 22 2, 841.60

Stainless ------------------------------------------------------- (5 ) 10. 80 5 5 10. 80 54. 00

Black plate:

C arbon----------------------------------------------------------- 3 50 . 94 47. 00 3 50 .94 47. 00

Tin and terne plate— hot dipped:

Carbon----------------------------------------------------------- 18 133 1.47 195.51 18 133 1.47 195.51

Tin plate— electrolytic:

Carbon----------------------------------------------------------- 18 396 1. 08 427.68 18 396 1. 08 427.68

Sheets— hot rolled:

Carbon----------------------------------------------------------- 19 1,719 . 59 1,014.21 19 1, 142 . 59 673.78

Alloy-------------------------------------------------------------- 5 75 1. 14 85. 50 5 31 1. 14 35. 34

Stainless ------------------------------------------------------- (5 ) 1. 78 5 9 1.78 16. 02

Sheets— cold rolled:

Carbon----------------------------------------------------------- 19 2, 266 . 73 1,654. 18 19 2, 843 . 73 2,075.39

Alloy-------------------------------------------------------------- (5) 1. 30 5 6 1. 30 7. 80

Stainless ------------------------------------------------------- 5 6 6. 76 40. 56 5 35 6. 76 236.60

Sheets— galvanized:

C arbon----------------------------------------------------------- 20 3 01 .94 282.94 20 301 .94 282.94

Alloy-------------------------------------------------------------- - 1.61 - 1.61 -

Strip— hot rolled:

Carbon----------------------------------------------------------- 21 899 1.01 907.99 21 928 1. 01 937.28

Alloy-------------------------------------------------------------- 29 1. 30 37. 70 - 1. 30 -

Stainless ------------------------------------------------------- - 3. 52 - 3. 52 -

Strip— cold rolled: ..

Carbon----------------------------------------------------------- 7 1,127 1.74 1,960.98 7 1,127 1.74 1,960.98

Alloy--------------------------------------------------------------

< (5) 12. 74 - 5 18 12. 74 229.32

Stainless ------------------------------------------------------- 5 29 5. 85 169.65 5 11 5. 85 64. 35

Sheets— all other coated:

Carbon----------------------------------------------------------- 20 4 5 1. 01 45.45 20 4 5 1. 01 45. 45

E lectrical sheets and strip:

Carbon------------------------------------ ---------------------- 22 53 1. 76 93. 28 (22) 1.76 -

Alloy--------------------------------------------------------------- 22 213 1. 94 413. 22 22 2 6 6 1.94 516.04

1 Excluding wheels and axles, because the labor cost data used do not cover this category. Since there is double counting 

in both German and ECSC production statistics when all products of the U. S. industry definition are included, United Nations 

shipments data, minus shipments for conversion into other steel products, have been substituted for production figures in 

certain cases, e. g. , ingots and sem is, wire rod, and h ot-rolled strip. In other cases, the production figure for a final p ro ­

duction (e .g ., coated sheets, cold-finished bars) has been subtracted from the production figure for the product from which 

it derives, as noted in the footnotes relating to individual products.

2 All coke produced by the steel industry is assumed to be consumed by the industry, since consumption totaled 

21,178 thousand m etric tons (hereafter referred to as MMT) and industry production 5,955 MMT.

3 Production of pig iron and ferroalloys (27,182 MMT) minus consumption (24,974 MMT) in steelmaking p rocesses.

4 The ECSC figure for the production of steel for castings is 638 MMT (including the production of independent foundries), 

of which 124 MMT (excluding the production of independent foundries) are alloy. United Nations data (Quarterly Bulletin of 

Steel Statistics for Europe, vol. XV, No. 4) list shipments of ingots and sem is, excluding shipments for conversion into other 

steel products, totaling 2,918 MMT. The total of steel for castings and shipments of ingots and sem is is then 3, 556 MMT. 

On the minimum output side, 1, 338 MMT are assumed to be ingots and 2,218 MMT, sem is; on the maximum side, 788 are 

assuined to be ingots and 2, 768, sem is.

5 The distribution of alloy steel, including stainless, among end products has been made on the basis of the following data:

Production 

(thousands of

Product category m etric tons)

Special crude steels:

Special carbon ingots--------------------------------------------- 697.2

Alloy ingots ----------------------------------------------------------- 2, 225. 8

Alloy steel for castings----- ----------------------------------- 124. 0

Stainless steel:

Ingots------------------------- --------------------------------------------- 267. 2

Steel for casting — ---------- ------------- ------------------------ 33. 9

SOURCE: For special crude steels, from Siderurgie (ECSC); 

and for stainless steel, from Metal Bulletin, February 26, 1965.

Relevant United Nations shipments data for special steels (alloy and special carbon) are presented in col. 1 of the 

following tabulation. If the average yield of special carbon steel from ingots to end products is estimated at 0.72, there are 

approximately 502 MMT of special carbon steels included in United Nations shipments figures. On the minimum output side, 

it has been assumed that this amount is divided equally among the categories "other ingots and sem is" and "section s, hotrolled (including b a rs)," leaving shipments figures, excluding special carbon steels, as shown in col. 2. On the maximum 

side, it has been assumed that this amount is all in the category "other ingots and se m is," leaving shipments figures as 

shown in col. 3.

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T a b le B—16. F o o t n o t e s ----Continued

Product category

Shipments of 

special steels 

(thousands of 

m etric tons) 

( 1 )

Estimated shipments of alloy 

steel, including stainless 

(thousands of m etric tons)

Minimum

output

( 2)

Maximum

output

(3)

Total 2, 118 1,616 1,616

Solids for seam less tubes------------------

Other ingots and sem is ----------------------

Sections, hot rolled (including bars) .

Wire ro d s --------------------------------------------

Strip— hot rolled ---------------------------------

Plates (3 mm. or m o re )---------------------

Sheets (less than 3 mm. ) --------------------

weight products and the second, high-weight products, as follow s:

030 779 528

716 465 716

175 175 175

58 58 58

58 58 58

81 81 81

stainless, have been made; the first

Product category

Minimum Maximum

output output

(thousands of m etric tons) Product category----Continued

Minimum Maximum

output output

(thousands of m etric tons)

T o ta l-------------------------------

Ingots and steel for castings----

Bloom , slabs, billets, tube,

rounds, skelp, etc -----------------

Wire r o d s ---------------------------------

Wire— drawn-----------------------------

Wire products----------------------------

Structural shapes (heavy)

and steel p ilin g-----------------------

B ars— hot rolled (including

light sh a p es)---------------------------

Bars— cold finished------------------

1.736 1,736

_a/ 324 _a/ 124

a/579 a / 528

b /4 1 b/41

b/130 b / 125

(b /) blS

_c/ 165 (c,

c / 300 c / 466

(c /) _c/ 100

Bars----tool steel-------

P la tes------------------------

Sheets— hot rolled — 

Sheets— cold rolled —

Strip— hot r o lle d -----

Strip— cold rolled ----

Pipe and tubing--------

Standard p ip e-------

Oil" country

g ood s ------------------

Line p ip e -------------

Mechanical tubing 

P ressure tubing —

(c/) c / 150

58 58

75 40

6 41

d/ 29 (d/)

d/ 29 d/29

(d/) d / 29

10

11

8

_a/ Alloy crude steel for castings (124) has been placed in the "ingots and steel for castings" category on both 

sides. Shipments of "other ingots and sem is" from cols. 2 and 3 in the previous tabulation have been distributed 

among the ingots and sem is categories to emphasize low-weight products on the minimum side and high-weight products on the maximum side.

b_j 41 MMT of wire rods were exported (ECSC data). If the remainder of wire rods were used to make wire

and wire products, output of these products was approximately 130 MMT (allowing for a yield loss of 3 percent).

_c/ Based on data for hot-rolled sections in cols. 2 and 3 above.

_d/ Based on United Nations shipments data for hot-rolled strip. No allowance has been made for yield loss

from hot-rolled strip to cold-rolled strip and pipe and tubing.

Stainless steel in end products, excluding stainless steel for castings, is assumed to total 160 MMT on the minimum 

side (267 times an average yield from crude steel of 0.60) and 187 MMT (267 x 0. 70) on the maximum side. Stainless steel 

for castings has been placed in the "ingots and steel for castings" category and is assumed to be shipped out of the industry 

in that form . Within this fram ework, distributions have been made to emphasize low-weight products on the minimum side 

and high-weight products on the maximum side, as follow s:

Minimum Maximum Minimum Maximum

output output output output

Product category (thousands of m etric tons) Product categorv----Continued (thousands of m etric tons)

T o ta l------------------------------- 194 221 Bars----tool s t e e l-------------------------

P la tes------------------------------------------- - 2

Ingots and steel ca stin g s --------- 34 34 Sheets— hot r o lle d ---------------------- - 9

Bloom s, slabs, billets, tube Sheets— cold rolled -------------------- 6 35

rounds, skelp, etc ----------------- 97 - Strip— hot r o lle d ------------------------ - -

Wire ro d s---------------------------------- - - Strip— cold rolled ----------------------- 29 11

W ire— drawn — ------------------------- 25 70 Pipe and tubing--------------------------- - 5

■\AZ-j rf» prnriiirts _ 5 Stand a Td pipe - -- -..

_ _

Structural shapes (heavy) O il- country

and steel p ilin g------------------- —- - g ood s ------------------------------------ - -

Bars— hot rolled (including Line pipe ------------------------------- -

light sh a p es)-------------------------- 0 10 M echanical tubing------------------ - -

Bars— cold finished------------------ - 40 Pressure tubing -------------------- - 5

6 United Nations shipments figure minus shipments for conversion into other steel products.

7 Production figure as given (ECSC) minus estimated amount in alloy.

8 Production figxire as given (ECSC) for large plates plus plates over 4. 75 mm. minus estimated amount in alloy and 

amount used to make welded pipe and tubing, 246 MMT (United Nations figure for shipments of plates and sheets 3 mm. and 

over to make pipe and tubing).

9 Production figure as given (ECSC) for railway m aterial minus amount in joint bars and tie plates (figure provided 

by the ECSC).

10 Figure as provided by the ECSC. Includes joint bars and tie plates.

11 Wheels and axles are included in the forgings industry and are not covered by labor cost data used for this study. 

Thus, production (175 MMT) has not been included.

12 Production figure as given (ECSC) minus estimated amount in alloy and tool steel and estimated amount used to p roduce cold-finished bars (production figure, 638, times 1. 10).

13 Production figure as given (ECSC).

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Table B—16. Footnotes----Continued

14 Production figures for tool steel are not given in ECSC statistics or in German statistics. On the minimum side,

no tool steel has been allowed (in bars), but 150 MMT (all alloy) have been allowed for on the maximum side.

15 The ECSC production figure for pipe and tubing (all qualities) is 2,723 MMT, of which 1,510 MMT are seam less and

1,213 MMT are welded. The total has been distributed among the various U. S. functional categories emphasizing low'-weight

categories on the minimum side and high-weight categories on the maximum side, as follow s:

Minimum Maximum

output output

Pipe and tubing (thousands of m etric tons)

Standard pipe ------------------------------

Oil-country g o o d s ----- ------------- —

Line pipe

__________ 1,150

__________ 300

1 14Q

517

790

517

M echanical tubing ______________ __________ 124 654

P ressure tubing----- -------- 245

Where some alloy steel has been assum ed, the alloy figure has been subtracted from the appropriate figure for all qualities 

as shown above.

16 Production figure for drawn wire (Industrie und Handwerk, Reihe 3) minus production of wire products and estimated 

amount in alloy.

17 Production figure as given (Industrie und Handwerk, Reihe 3).

18 The ECSC production figure for tin and terne plate is 529 MMT. The relative distribution between the hot-dip and 

electrolytic processes has been estimated to be the same as the 1965 distribution, which was provided by the ECSC.

19 The ECSC production figure for sheets 4.75 mm. or less plus coils, which have been added to h ot-rolled sheets, 

minus the estimated amounts used to produce coated products, electrical sheets and strip, and cold-rolled strip. This avoids 

double counting. Relevant production figures are as follow s:

P roauction 

(thousands of

Product category m etric tons)

Sheets— hot rolled J>4.7 5 mm ------------------------------- 2,066

Sheets— cold rolled <4. 75 mm ---------------------------------- 3,463

Tin and terne p late------------------------------------------------------ 529

Black plate ------------------------------------------------------------------ 50

Galvanized sheets ------------------------------------------------------- 301

Other coated sh eets---------------------------------------------------- 45

E lectrical sheets and s t r ip ----------------------------------------- 266

Coated and electrical sheets and strips are assumed to derive from hot- and cold-rolled sheets as follow s:

Product category

Total

Minimum output Maximum output

(thousands of m etric tons) (thousands of m etric tons)

Cold- rolled Hot- rolled Cold- rolled Hot- rolled

sheets sheets sheets sheets

1. 191 579 612

Black p la te --------------------------------------------------------------------- 50

Tin and terne plate-------------------------------------------------------- 529

Galvanized sheets ---------------------------------------------------------- 301

Other coated sh eets------------------------------------------------------- 45

E lectrical sheets and s t r ip ------------------------------------------- 266

50

529

301

45

266

United Nations shipments data indicate that 426 MMT of plates and sheets 3 mm. and over were used to make pipe and

tubing and 272 MMT to make cold-rolled strip. It has been assumed that plates were used to make pipe and tubing, and hotrolled sheets to make cold-rolled strip.

These totals must be subtracted from the total production figures for hot- and cold-rolled sheets, and the estimated 

amount of alloy and stainless must be subtracted from this figure to arrive at the figures listed for carbon steel. No yield

loss from hot- and cold -rolled sheets to coated sheets has been allowed.

20 Figure as given (Statistisches Bundesamt).

21 United Nations shipments figure minus amount for conversion into other steel products less the estimated amount in 

alloy and stainless.

22 The production of electrical sheets and strip (266— ECSC) has been placed entirely in the alloy category on the maximum 

side; on the minimum side, 20 percent has been placed in the carbon category and 80 percent in the ailoy category. E lectrical 

sheets and strip are not classified as alloy steel according to German definitions, but U. S. definitions classify alm ost all of 

this product as alloy steel.

SOURCE: Sidgrurgie (Luxembourg, Statistical Office of the European Communities), 1966-No. 3; Quarterly Bulletin of

Steel Statistics for Europe (New York, U. N. Econom ic Com m ission for Europe), vol. XV, No. 4; Eisen und Stahl, 4 . 

V ierteljahresheft 1965 (Dusseldorf, Statistisches Bundesamt, Aussenstelle Dusseldorf); Metal Bulletin, February 26, 1965; and 

Industrie und Handwerk, Reihe 3, 1965 (Wiesbaden, Statistisches Bundesamt).

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T a b le B—17. G e rm a n y ( F e d e r a l R e p u b lic ). E s tim a te s o f E m p lo y m e n t C o s t f o r W a ge E a r n e r s

and S a la r ie d E m p lo y e e s , U. S. In d u stry D e fi n i t i o n ,1 Iro n and S te e l In d u s try , 1964

Cost figures in deutsche marks z )

W orker category Minimum

estimate

Maximum

estimate

Wage earners:

Employment 3 ---------------------------------------------------------------------------------------------------------- 297,990 297,990

Hours worked per year 4 -------------------------------------------------------------------------------------- 1,950 1,990

Total hours w orked5---------------------------------------------------------------------------------- ---------- 581,080,500 593,000,100

Labor cost per hour:

W age6----------------------------------------------------------------------- ----------------------------------------- 4. 30 4. 58

Total c o s t7------------------------------ ------------------------------------------------------------------------- 6. 32 6. 73

Wages, total-------------------------------------------------- -------------------------------------------------------- 2,498,646,150 2,715,940,458

Total labor cost ---------------------------------------------------------------------------- ----------------------- 3,672,428,760 3, 990, 890, 673

Salaried em ployees:

Employment 8 -------------------------------------------------------------------------------------------------- ------- 62,611 62,611

Labor cost per month:

5»a.l 3 ry 9 ... - -...... 999 1, 069

Total labor c o s t 10-------------------------------------------------------------------------------------------- 1,419 1, 518

Sala rie s , total11-------------------------------------------------------------------------------------------------- 750,580,668 803,173,908

Total labor c o s t 11----------------------------------------------------------------------- -------- ----------------- 1,066,140,108 1,140,521,976

Wage earners and salaried em ployees:

Wages and salaries ----------------------------------------------------------------------------------------------- 3,249,226,818 3,519,114,366

Total labor cost ----- --------------------------------------------------------------------------------------------- 4,738,568,868 5, 131,412,649

1 But excluding wheels and axles.

2 US$ 1 = 3. 977 DM.

3 Based on data in Industrie und Handwerk, Reihe 1, pertaining to em ployees producing iron and steel products only

(i. e. , the data in this series which are on a "beteiligten" basis). The source gives average yearly wage earner employment,

including apprentices, of 240,186 for "blast furnaces, steel m ills, and hot rolling m ills" (Standard Industrial Classification— 

System atisches W arenverzeichis fur die Industriestatistik 1963— number 2710) and 66, 262 for "drawing and cold rolling m ills" 

(number 3010).

According to data in the Statistisches Jahrbuch der E isen- und Stahlindustrie fur 1965, approxim ately 2.76 percent 

(average of Decem ber 1963 and Decem ber 1964 figures) of wage earners in the iron and steel industry, including forgings 

and locally connected establishments, were apprentices.

Total wage earner employment is then estimated to be 240, 186 plus 66, 262 minus the estimated number of apprentices.

4 Based on data in Industrie und Handwerk. Reihe 1, pertaining to all em ployees in establishments prim arily engaged

in the production of iron and steel products (i. e. , the data in this series which are on a "hauptbeteiligten" basis), and data

on employment and hours worked from Sidgrurgie, pertaining to the ECSC portion of the steel industry. The form er source 

indicated average yearly hours worked by wage earners, including apprentices, in "blast furnaces, steel m ills, and hot rolling 

m ills" and in "drawing and cold rolling m ills" of 1,971 and 2,010, respectively. Sidgrurgie indicates average yearly hours 

worked by wage earners, excluding apprentices, to be 1,964.

5 Employment times estimated hours worked per year.

6 Includes pay for time worked, at hourly and piece rates, including prem ium s for overtim e, hazardous work, e tc., 

cost-of-liv in g allowances, and payment for excused absence for attendance at union m eetings. The maximum estimate is the 

ECSC (Salaires CECA) figure for direct wages, pertaining to the ECSC portion of the industry. Industrie und Handwerk, Reihe 1, 

indicates that gross earnings (including bonuses) of wage earners in "drawing and cold rolling m ills" were approximately 

14 percent less than those in "blast furnaces, steel m ills, and hot rolling m ills. " Thus, it is assumed that the average 

figure for the total industry must be somewhat less than the ECSC figure.

7 Includes wages plus bonuses (including productivity bonuses), holiday and vacation pay, social security payments, payment in kind, and other employment costs. The maximum estimate is the ECSC figure for total cost, pertaining to the ECSC 

portion of the industry. The minimum estimate is assumed to be lower than this figure to the same extent that the minimum 

wage figure is lower than the maximum wage figure, as explained in footnote 6.

8 Based on data in Industrie und Handwerk. Reihe 1. which indicate salaried employment, including apprentices, in 

"blast furnaces, steel m ills, and hot rolling m ills" and "drawing and cold rolling m ills" of 50, 934 and 14,972, respectively. 

(The data are com parable to that used for wage earners, footnote 3. )

According to data in the Statistisches Jahrbuch der Eisen- und Stahlindustrie fur 1965. approximately 5 percent (average 

of Decem ber 1963 and D ecem ber 1964 figures) of salaried em ployees in the iron and steel industries, including forgings and 

locally connected establishments, were apprentices.

Total salaried employment is then estimated to be 50, 934 plus 14,972 minus the estimated number of apprentices (5 percent).

9 The maximum estimate is the ECSC (Salaries CECA) figure for monthly m onetary remuneration (1,249 DM) pertaining 

to the ECSC portion of the industry minus the estimated portion of this figure which related to bonuses and holiday and vacation 

pay, which is not included in "w a g e s." These items have been estimated to account for the same percentage of m onetary 

remuneration of salaried em ployees as of wage earners (14.4 percent). Industrie und Handwerk. Reihe 1. indicates that gross 

earnings (including bonuses) of salaried em ployees in "drawing and cold rolling m ills" were approxim ately 14.5 percent less 

than those in "blast furnaces, steel m ills, and hot rolling m ills. " Thus, as in the case of wages (footnote 6), it is assumed 

that the average figure for the total industry must be somewhat less than the ECSC figure.

10 The maximum estimate is the ECSC figure for total cost, pertaining to the ECSC portion of the industry. The minimum 

estimate is assumed to be lower than this figure to the same extent that the minimum salary figure is low er than the maximum 

salary figure.

“ Monthly cost x 12 x employment.

SOURCE: Based on data in Salaires CECA, 1964, Social Statistics series, 1966-No. 2, and Sidgrurgie, 1966-No. 3 

(Luxembourg, Statistical Office of the European Comm unities); and Industrie und Handwerk. Reihe 1. 1965 (Wiesbaden,

Statistisches Bundesamt).

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T a b le B —18. G e r m a n y ( F e d e r a l R e p u b lic ). E s tim a te s o f T o ta l H o u rs W o r k e d ,

U. S. In d u str y D e f in it io n ,1 Iro n and S t e e l In d u s tr y , 1964

Wage earner:

Minimum ‘

Maximum

Work. category Total hours

worked

581,080, 500

593,000,100

Salaried employees:

Minimum 3 -----------

Maximum 3-----------

122,091,450

124,595,890

Wage earners and salaried employees:

Minimum-----------------------------------------------

Maxim um ----------------------------------------------

703, 171, 950

717,595,990

1 But excluding wheels and axles.

2 From table B~17.

3 Using employment figures from table B ~17 and the estimate that salaried

employees work the same number of hours per year as wage earners.

Table B—19. Germany (Federal Republic). Estimates of Average Hourly Labor Cost

for Wage Earners and Salaried Employees, U. S. Industry Definition,1

Iron and Steel Industry, 1964

Worker category

Employment

cost

(in deutsche

marks 2) 3

Hours

worked 4

Averag.

labor

; hourly

cost

In deutsche

marks 2 5 In dollars

(1) (2) (3) (4)

Wage earners:

Wages:

Minimum------------------------------------------------------- 2 ,49 8 ,64 6 ,15 0 5 81,080,500 4. 30 1. 08

M axim um ----------------------------------------------------- 2 ,71 5 ,94 0 ,45 8 5 93,000,100 4. 58 1. 15

Total cost:

Minimum------------------------------------------------------- 3 ,6 7 2 ,42 8 ,76 0 581, 080, 500 6. 32 1. 59

M axim um----------------------------------------------------- 3, 990,890,673 5 93,000,100 6. 73 1.69

Salaried employees:

Salaries:

Minimum------------------------------------------------------ 750,580, 668 122,091,450 6. 15 1. 55

M axim um ----------------------------------------------------- 803,173,908 124,595, 890 6.45 1. 62

Total cost:

Minimum------------------------------------------------------- 1 ,06 6 ,14 0 ,10 8 122,091,450 8.73 2. 20

M axim um ----------------------------------------------------- 1 ,14 0 ,52 1 ,97 6 124,595,890 9. 15 2. 30

Wage earners and salaried employees:

Wages and salaries:

Minimum------------------------------------------------------- 3 ,2 4 9 ,22 6 ,81 8 703, 171,950 4. 62 1. 16

M axim um ----------------------------------------------------- 3 ,51 9 ,11 4 ,36 6 717, 595,990 4. 90 1. 23

Total cost:

Minimum------------------------------------------------------- 4 ,7 3 8 ,5 6 8 ,8 6 8 703, 171,950 6. 74 1. 69

M axim um ----------------------------------------------------- 5, 131,412,649 7 17,595,990 7. 15 1.80

1 But excluding wheels and axles.

2 US$ 1 = 3. 977 DM.

3 From table B- 17.

4 From table B~ 18.

5 Col. 1 4- col. 2.

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Table B—ZO. Germany (Federal Republic). Calculation of Unit Labor Cost for Wage Earners 

and Salaried Em ployees, U. S. Industry D efinition,1 Iron and Steel Industry, 1964

Employment W eighted Unit labor cost per ton

W orker category cost

(in deutsche

output

(thousands of M etric tons 4 5 Short tons 4 5

marks 2) 3 m etric tons 4 ) In deutsche 

marks 2 In dollars 2 In deutsche 

marks 2 In dollars 2

Wage earners: 

W ages:

(1) (2) (3) (4) (5) (6)

M inim um--------------------------------------------- 2,498,646, 150 31,797.0 78. 58 19. 76 71.29 17. 93

M axim um -------------------------------------------

Total cost:

2,715,940,458 27,783.3 97. 75 24. 58 88. 68 22. 30

M inim um --------------------------------------------- 3,672,428,760 31,797.0 115.50 29. 04 104.78 26. 35

M axim um --------------------------------------------

Salaried em ployees:

Salaries:

3,990,890,673 27,783.3 143.64 36. 12 130.31 32. 77

M inim um --------------------------------------------- 750,580,668 31,797.0 23. 61 5. 94 21.41 5. 38

M axim um --------------------------------------------

Total cost:

803, 173, 908 27,783.3 28. 91 7. 27 26. 22 6. 59

M inim um --------------------------------------------- 1,066,140,108 31,797.0 33. 53 8.43 30. 42 7. 65

M axim um --------------------------------------------

Wage earners and salaried em ployees: 

Wages and salaries:

1, 140, 521,976 27,783.3 41. 05 10. 32 37. 24 9. 36

M inim um --------------------------------------------- 3,249,226,818 31,797.0 102. 19 25. 69 92. 70 23. 31

M axim um --------------------------------------------

Total cost:

3,519,114,366 27,783.3 126.66 31. 85 114.91 28. 89

M inimum--------------------------------------------- 4,738,568,868 31,797.0 149.03 37. 47 135.20 33. 99

M axim um -------------------------------------------- 5,131,412,649 27,783.3 184.69 46. 44 167.55 42. 13

1 But excluding wheels and axles.

2 US$ 1 = 3. 977 DM.

3 From table B—17.

4 1 short ton = 0. 9072 m etric tons, or 1 m etric ton = 1. 1023 short tons.

5 Col. 1 + col. 2.

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T a b le B —21. G e rm a n y (F e d e r a l R e p u b lic ). E s tim a te s o f M a n -H o u rs p e r T on and O utput p e r 1, 000 M a n -H o u r s ,

U. S. In d u stry D e fin itio n , 1 Iro n and S te e l In d u stry , 1964

Calculation of man--hours per ton

W orker category Hours

W eighted 

output M an-hours per ton

worked 2 (thousands of 

m etric tons 3 ) M etric ton 3 4 Short ton 3

(1) (2) (3) (4)

Wage earners:

Minimum------------------------------------------------------------------------------------- 581,080,500 31,797.0 18. 27 16. 58

M axim um ------------------------------------------------------------------------------ ---- 593,000,100 27,783.3 21. 34 19. 36

Salaried em ployees:

122,091,450 

124,595,890

31,797.0 

27,783.3

3. 84 3. 48

4. 48 4. 07

Wage earners and salaried em ployees:

M inim um ------------------------------------------------------------------------------------- 703, 171,950 31,797.0 22. 11 20. 06

M axim um ----------------------------------------------------------------------------------- 717,595,990 27,783.3 25. 83 23. 43

Calculation of output pe r 1, 000 m an-hours

Weighted

output Hours Output per 1,000 m an-hours

(thousands of 

m etric tons 1 23) 4

worked 2 M etric tons 3 4 Short tons 3

(1) (2) (3) (4)

Wage earners:

M inim um -------------------------------------------------------------------------------------

M a x i m u m - - - __- ............. ...... ......

27,783.3 

31,797.0

593,000.1 

581,080.5

46. 85 

54. 72

51. 65 

60. 32

Salaried em ployees:

M inim um ------------------------------------------------------------- ----------------------- 27,783.3 124,595.9 222.99 245.80

M axim um ----------------------------------------------------------------------------------- 31,797.0 122,091.5 260.44 287.08

Wage earners and salaried em ployees:

M inim um ------------------------------------------------------------------------------------- 27,783.3 717,596.0 38. 72 42. 68

M axim um ----------------------------------------------------------------------------------- 31,797.0 703,172.0 45. 22 49. 85

1 But excluding wheels and axles.

2 From table B~18.

3 1 short ton = 0. 9072 m etric ton, or 1 m etric ton = 1. 1023 short tons.

4 Col. 1 4- col. 2.

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T a b le B —22. U n ited K in g d o m . E s tim a te o f M in im u m and M a x im u m W e ig h te d O utput,

Iro n and S te e l In d u s try , U. S. In d u stry D e fi n i t i o n ,1 1964 2

(II1 thousands of British standard tons 3)

Minimum Maximum

Product category

Production 

distribution 

emphazing 

low-weight 

products

Weight W eighted 

output

Production 

distribution 

emphazing 

high-weight 

products

Weight Weighted

output

All product categories ---------------------------- 20,950. 1 18,632.0 20. 950. 1 19.699.8

C oke------------------------------------------------------------------- < (4) 0. 06 s (4) 0. 06

Pig iron and ferro a llo y s ----------------------------------- 5 1,824. 1 . 13 237. 1 5 1,824.1 . 13 237. 1

Ingots and steel for castings:

Carbon---------------------------------------------------------- 6 1. 5 . 20 . 3 6 1. 5 . 20 . 3

Alloy-------------------------— --------------------------------- 6. 6 . 27 . 2 6. 6 . 27 . 2

Stainless ------------------------------------------------------- - .45 - - . 45 -

Bloom s, slabs, billets, tube rounds, 

skelp, etc:

Carbon---------------------------------------------------------- 7 552.2 . 57 314. 8 7 552.2 . 57 314. 8

Alloy----- -------------------------------------------------------- 7 52 1.6 1. 09 568. 5 7 521. 6 1. 09 568o 5

Stainless ------------------------------------------------------- 7 11. 9 2. 15 25. 6 7 11.9 2. 15 25. 6

Wire rods:

Carbon----------------------------------------------------------- 8 1,504.7 . 80 1,203. 8 8 1,504.7 . 80 1,203.8

Alloy............. --------------------------------- --------- ------ 8 33. 1 1.67 55. 3 8 33. 1 1.67 55. 3

Stainless ------------------------------------------------------- 8 4. 6 6. 06 27. 9 84. 6 6. 06 27. 9

Structural shapes (heavy) and steel piling:

Carbon---------------------------------------------------------- 9 2, 1 35.6 .71 1,516. 3 9 2, 135.6 .71 1,516. 3

Alloy-------------------------------------------------------------- 1048. 7 1.49 72. 6 (10) 1.49 -

Stainless ------------------------------------------------------- - 5.85 - - 5. 85 -

P lates:

Carbon---------------------------------------------------------- 11 3, 191.6 . 67 2,1 38.4 " 3 , 191.6 . 67 2,1 38.4

Alloy----- -------------------------------------------------------- 12 31. 2 1.43 44. 6 12 31.2 1.43 44. 6

Stainless ------------------------------------------------------- 12 19. 3 5. 60 108. 1 1219. 3 5. 6Q 108. 1

Rails, standard and all other:

Carbon---------------------------------------------------------- 13 317.8 . 70 222. 5 13 3 17.8 . 70 222. 5

Alloy--------- ----------------------------------------- -------- - 1. 56 - - 1. 56 -

Joint bars, tie plates, and track spikes:

Carbon---------------------------------------------------------- 14 18. 1 1.46 26. 4 1418. 1 1.46 26. 4

Wheels and axles:

Carbon---------------------------------------------------------- 15 59. 2 1.90 112. 5 15 59. 2 L 90 112. 5

Alloy— ........—------------------------------------------------- 15 4. 7 2. 90 13. 6 15 4. 7 2. 90 13. 6

Bars— hot rolled (including light shapes):

16 1,941. 0 16 1,941. 0 

18 24 3. 7

Carbon---------------------------------------------------------- . 94 1,824.5 . 94 1,824.5

Alloy---------------------------........... — -------------------- 16 195. 0 1.47 286. 7 1.47 358. 2

Stainless ------------------------------------------------------- 16 26. 0 7. 18 186. 7 16 26, 0 7. 18 186. 7

Bars— reinforcing:

Carbon----------------------------------------------------------- 17 617. 9 . 68 420. 2 17 617. 9 . 68 420. 2

Alloy....................-.................................................... - 1.44 - - 1.44 -

Bars— cold finished:

Carbon---------------------------------------------------------- 17 552. 9 1.44 796. 2 17 552. 9 1. 44 796. 2

Alloy--------------------------- ---------------------------------- 17 71.8 2. 43 174. 5 17 71.8 2. 43 174. 5

Stainless ------------------------------------------------------- 17 4. 8 10. 27 49. 3 17 4. 8 10. 27 49. 3

Bars----tool steel:

Carbon---------------------------------------------------------- 18 10. 4 5.81 60. 4 18 10. 4 5.81 60. 4

Alloy-------------------------------------------------------------- 18 33. 1 10. 45 345. 9 18 33. 1 10. 45 345. 9

Standard pipe:

Carbon---------------------------------------------------------- 19 6 19. 8 1.26 780. 9 19 247. 9 1.26 3 12. 4

Alloy-------------------------------------------------------------- (19) 1.73 -

O

1.73 -

Stainless ------------------------------------------------------- (19) 8. 13 - (19) 8. 13 -

Oil-country goods:

Carbon —----- -------------------------------------------------- (19) 1. 53 - 19 37 1.9 1. 53 569. 0

Alloy-------------------------------------------------------- ---- (19) 2. 12 - 19 22. 1 2. 12 46. 9

Line pipe:

Carbon---------------------------------------------------------- 19 6 19. 8 1. 12 694. 2 19 247. 9 1. 12 277. 6

Alloy---------- --------------------------------------------------- 19 120. 6 1. 72 207. 4 19 22. 1 1. 72 38. 0

M echanical tubing:

Carbon---------------------------------------------------------- 19 69. 3 2. 31 160. 1 19 317. 2 2. 31 732. 7

Alloy........— ........ — ---------------------------------------

o

3.46 - 19 55. 3 3.46 191. 3

Stainless ------------------------------------------------------- (19) 18. 33 -

(19) 18. 33 -

P ressure tubing:

Carbon----------------------------------------------------------- (19) 3. 17 - 19 124. 0 3. 17 393. 1

Alloy-------------------------------------------------------------

o

5. 18 - 19 11. 1 5. 18 57. 5

Stainless ------------------------------------------------------- (19) 18. 93 - 19 10. 0 18. 93 189. 3

Wire— drawn:

Carbon----------------------------------------------------------- (20) 1. 75 _

(20) 1. 75 _

Alloy-------------------------------------------------------------

(20) 2. 88 -

(2°) 2. 88 -

Stainless ------------------------------------------------------- (2°) 10. 54 -

(20) 10. 54

See footnotes at end of table,

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T a b le B—22. U n ited K in g d o m . E s tim a te o f M in im u m and M a x im u m W e ig h te d O utput,

Iro n and S te e l In d u s try , U. S. In d u stry D e fin itio n , 1 1964 2— C on tin u ed

(In thousands of British standard tons 3)

Product category

Minimum Maximum

Production

distribution

emphazing

low-weight

products

Weight Weighted

output

Production

distribution

emphazing

high-weight

products

Weight Weighted

output

Wire products:

Carbon----------------------------------------------------------- (2°) 2. 22 (2°) 2. 22

Stainless ------------------------------------------------------- (“ ) 10. 80 -

(20) 10. 80 _

Black plate:

Carbon----------------------------------------------------------- 17 30. 8 . 94 29. 0 17 30. 8 . 94 29. 0

Tin and terne plate— hot dipped:

Carbon----------------------------------------------------------- 17 231. 1 1.47 339. 7 17 231. 1 1.47 339. 7

Tin plate— electrolytic:

Carbon----------------------------------------------------------- 17 922. 7 1. 08 996.5 17 922. 7 1.08 996. 5

Sheets— hot rolled:

Carbon----------------------------------------------------------- 21 429. 4 . 59 253. 3 21 429. 4 .59 253. 3

Alloy--------------------------------------------------------------- 22 2. 2 1. 14 2. 5 22 2. 2 1. 14 2. 5

Stainless ------------------------------------------------------- 23 19. 2 1. 78 34. 2 (23) 1.78 _

Sheets— cold rolled:

Carbon----------------------------------------------------------- 24 2, 350. 1 . 73 1,715. 6 24 2, 350. 1 . 73 1,715. 6

Alloy--------------------------------------------------------------- 25 2 .0 1. 30 2. 6 25 2. 0 1. 30 2.6

Stainless ------------------------------------------------------- 23 19. 3 6. 76 130. 5 23 3 8 . 5 6. 76 260. 3

Sh e et s— g al vani z e d:

Carbon---------------------------------------------- ------------ 17 311. 1 . 94 292.4 17 311. 1 . 94 292. 4

Alloy-------------------------------------------------------------- - 1.61 - - 1.61 -

Strip— hot rolled:

Carbon----------------------------------------------------------- 26 520. 2 1. 01 525.4 26520. 2 1. 01 525.4

Alloy--------------------------------------------------------------- 27 2. 5 1. 30 3. 3 27 2. 5 1. 30 3. 3

Stainless -------------------------------------------------------

(28) 3. 52 -

(28) 3. 52 -

Strip— cold rolled:

Carbon----------------------------------------------------------- 26 5 2 9. 5 1.74 921.3 26 529. 5 1.74 921. 3

Alloy-------------------------------------------------------------- 29 1.7 12. 74 21.7 29 1. 7 12. 74 21.7

Stainless ------------------------------------------------------- 30 14. 1 5. 85 82. 5 30 14. 1 5. 85 82. 5

Sheets— all other coated:

Carbon----------------------------------------------------------- 17 176. 8 1. 01 176. 8 17 178. 6 1. 01 178. 6

E lectrical sheets and strip:

Carbon----------------------------------------------------------- 31 44. 9 1.76 79. 0 (31) 1.76 _

Alloy--------------------------------------------------------------- 31 179. 6 1. 94 348.4 31 224. 5 1. 94 435. 5

1 The following p rocesses, included in the U. K. industry definition but not included in the U. S. definition, have been

excluded from the U. K. data for the purposes of this study: Iron ore mines and quarries, forges and ancillary p rocesses

(other than drop forges), steel foundries and ancillary processes (including melting for manufacture of steel castings), and 

wrought iron manufacture. W ire and wire products are excluded from the U. K. definition but are included in the U. S. definition. These 2 categories, however, have not been added to the U. K. definition, since the necessary data are not available.

2 53 weeks.

3 1 British standard ton = 1.016 m etric tons or 1. 120 short tons.

4 No net shipments of coke out of the industry are allowed, since consumption by the industry was 12, 364 thousand

British standard tons (hereafter referred to as MBT), while production by the steel industry totaled 1 1,530 MBT.

5 Production of pig iron ( 17, 105. 2 MBT) plus im ports (335. 8 MBT) minus consumption in the steel industry (15, 616. 9 MBT).

6 Exports of ingots.

7 Shipments of ingots and sem ifinished products out of the steel industry, excluding shipments to make "forgings (excluding drop forg in g s)," from U. K. source (Iron and Steel Annual Statistics), plus estimated quantity shipped to make "forgings

(excluding drop forgings)" minus exports of ingots.

8 Total shipments minus shipments for intraindustry conversion (other than for wire and wire products). It has been

estimated that the ratio of shipments for conversion (144. 1 MBT all qualities) to total shipments (1,685. 7 MBT-----all qualities)

is the same for carbon, alloy, and stainless wire rods.

9 U. K. shipments figure for "other heavy-rolled products" minus shipments for intraindustry conversion.

10 On the minimum output side, 20 percent of alloy steel (minus shipments for conversion) reported in U. K. data under 

"other light-rolled sections and hot-rolled bars" has been placed in the structural shapes category. See footnote 16.

11 U. K. shipments figure for carbon plates 3 mm. and over minus shipments of plates (all qualities) for intraindustry 

conversion (81. 1 MBT).

12 U. K. shipments figure for plates over 0.176 inches.

13 U. K. shipments figures for heavy rails plus shipments of light rails and a ccessories and sleepers.

14 Includes fishplates and soleplates.

15 U. K. shipments figure for tires, wheels, axles, and rolled rings.

16 U .K. shipments figure for "other light-rolled sections and hot-rolled bars" plus shipments of "arch es" minus shipments

for intraindustry conversion. Of total shipments of "arch es, light rails and a ccessories" (353. 7 M BT), 337. 1 MBT were in 

arches and 16.6 MBT in light rails and a ccessories. Of total shipments for conversion (639.6 M BT), 512.4 MBT were for 

bright steel bars, 126.6 MBT for tubes, and 0.6 MBT for other purposes. It has been estimated that of the 512.4 MBT for 

bright steel bars, 63.0 MBT were alloy (excluding stainless) and 4.1 MBT were stainless. Of the 126.6 MBT for tubes, an 

estimated 120 MBT were alloy. The result is as follow s:

Without deduction With deduction

for conversion for conversion

B ars— hot rolled (thousands of British standard tons)

T o ta l........................................................ 2.850. 3 2. 210.7

Carbon------------------------------------------------------ 2, 393.5 1,941.0

Alloy---------------------------------------------------------- 426.7 243.7

Stainless -------------------------------------------------- 30. 1 26. 0

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Table B~22. Footnotes— Continued

U. K. data include shipments of alloy steel heavy structural shapes ("other heavy-rolled products") with figures for hotrolled bars and light shapes ("other light-rolled sections and hot-rolled ba rs"). T herefore, on the minimum output side, 

20 percent of the alloy figure (243.7 MBT) has been placed in the structural shapes category; on the maximum output side, 

all alloy has been placed in the h ot-rolled bars and light sections category.

17 U. K. shipments figure as given.

18 U. K. shipments figure for "high-speed and other tool and magnet ste e l."

19 U. K. shipments data on pipe and tubing are as follow s:

Pipe and tubing

Carbon tubes and pipes (excluding welded 

tubes over 16 inches outside diameter) --

E lectric conduit--------------------------------------

Oth e r :

W elded-----------------------------------------------

W eldless---------------------------------------------

Carbon tube and pipe fittings (excluding

flanges) ------------------------------------------------------

Alloy tubes and pipes (including stainless)

Shipments (thousands 

of British standard tons)

1,288.0 

48. 4

767. 5 

472. 1

20. 9 

120. 6

On both the minimum and maximum output sides, electric conduit and tube and pipe fittings have been placed in the 

m echanical tubing category. On the minimum side, the remainder of the carbon pipe and tubing (welded and w eldless) has been 

divided evenly between standard and line pipe. All alloy steel has been placed in the line pipe category, and no stainless steel 

has been allowed. On the maximum side, 10 MBT of stainless have been allov/ed and the remainder of alloy and carbon steel 

has been distributed to emphasize high-weight products. The 2 distributions are as follows:

Pipe and tubing 

T o ta l---------------------------------------

Standard pipe ------------------------------------

Oil-country g ood s -----------------------------

Line pipe -------------------------------------------

Mechanical tubing-----------------------------

Pressure tubing -------------------------------

Minimum output Maximum output

_____ ______ (thousands of British standard tons)_____________

Carbon Alloy Carbon Alloy Stainless

,308.9 120. 6 1.308.9 110. 6 10

619. 8 _ 247. 9 - _

- - 37 1. 9 22. 1 -

619. 8 120. 6 247. 9 22. 1 -

69. 3 - 317. 2 55. 3 -

- - 124. 0 11. 1 10

20 Wire and wire products are not within the U. K. definition of the steel industry, and appropriate data are not available 

for these products. M aterial for conversion to wire and wire products is included in shipments of wire rods.

21 U. K. shipments figure for hot-rolled uncoated sheets under 3 mm. minus shipments for conversion into other steel 

products (484. 3 MBT).

22 U. K. shipments figure for alloy h ot-rolled sheets 0. 176 inches and under.

23 U. K. shipments figure for stainless hot- and cold-rolled sheets 0.176 inches and under minus shipments for intraindustry conversion (7.4 MBT) is 38.5 MBT. On the minimum side, this amount has been divided equally between hot- and 

cold-rolled sheets. On the maximum side, the total amount has been placed in the cold-rolled category.

24 U. K. shipments figure for cold -rolled uncoated sheets under 3 mm. (excluding electrical) minus shipments for conversion into other steel products (5.4 MBT).

25 U. K. shipments figure for alloy cold -rolled sheets 0. 176 inches and under.

26 U. K. shipments figure as given minus shipments for conversion into other steel products (171. 1 MBT).

27 Estimated shipments minus estimated shipments for conversion into other steel products. 28 A l l s ta in le ss str ip has been p l a ced in the c o ld - r o l le d ca te gor y .

29 Shipments estimated from production data.

30 U. K. shipments of stainless strip, minus shipments for conversion into other steel products (2. 1 MBT).

31 E lectrical sheets do not fall within the U. K. definition of alloy steel, but almost all electrical steel in the United States

falls within the U. S. definition of alloy steel. On the minimum side, 20 percent of the U. K. shipments figure (224.5 MBT)

has been placed in the carbon category, and on the maximum side, the total amount has been placed in the alloy category.

SOURCE: Iron and Steel Annual Statistics, 1964 (London, Iron and Steel Board and the British Iron and Steel Federation, 1965).

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Table B~23. United Kingdom. Estimates of Employment Cost for Wage Earners and Salaried Em ployees, 

U. S. Industry Definition, 1 Iron and Steel Industry, 1964

(Earnings and employment cost in pounds2)

Average weekly earnings 4 Aggregate employment cost

W orker category 

and process

Average 

numb e r

E stimatedE stimated Wages and salaries Total cost

of

persons 

at work 3

D ecem ­

ber 

1963 5

D ecem ­

ber 

1964 6

m inimum 

annual 

average 7

m aximum 

annual 

average 8

Minimum 

estimate 9

Maximum 

estimate 10

Minimum 

estimate 11

Maximum 

estimate 11

(1) (2) (3) (4) (5) (6) (7) (8) (9)

P rocess workers -------------------- 119,856 - - - _ 108,766,755 114,993,922 _

Coke ovens at blast 

fu rn aces---------------------------- 4, 866 17. 15 18. 60 17. 52 18. 24 4,109,146 4,411,173 .

Blast furnaces and 

sintering p la n ts --------------- 10,808 17.40 18. 15 17. 59 17. 97 9,163,345 9,652,734

Steel melting furnaces and 

ancillary p rocesses (excluding melting for manufacture of steel 

castings ---------------------------- 20,559 20. 15 20. 50 20. 24 20.42 20,056,695 20,864,806

Rolling m ills and ancillary 

processes (excluding 

wrought iron, sheet, and 

tinplate rolling, but including bright b a rs )--------- 49,386 18. 70 19. 65 18. 94 19.42 45,084,882 47,666,077

Sheet m ills -------------------------

Tinplate m anufacture---------

12,832 

3, 142

20. 20 

20. 05

21. 35 

21. 00

20. 49 

20. 25

21. 07 

20. 87

12,673,313 

3,066,773

13,437,389 

3,259,028 _

Steel tubes, pipes, and 

fittings (excluding welded 

tubes over 16 inches outside diam eter)------------------ 18,263 16. 25 17. 65 16. 60 17. 30 14,612,601 15,702,715

General and maintenance 

workers associated with 

above processes ------------------- 12 89. 134 13 17. 80 13 18. 70 18. 02 18. 48 76.615,502 81,042.204

Wage earners, to ta l----- 208,990 - - - - 185,382,257 196,036,126 214,067,200 226,369,600

Salaried em ployees, 

total:

Adm inistrative, 

technical, and 

clerical em ployees 

associated with 

above p rocesses 14 — 12 50, 017 1317. 15 13 18. 60 17. 52 18. 24 41,273,636 43,334,725 47,660.100 50.040,100

Wage earners and salaried 

em ployees, total------------------- 259,007 - 226,655,893 239,370,851 261,727,300 276,409,700

1 But excluding wire and wire products.

2 US$ 1 = 0. 3584 pound.

3 Average of figures relating to 1 week in each month. 4 G r o s s a v e r a g e paym ents to p e r s on s at w o rk (dur ing any p a r t of the su rv e y w e ek ) , inc lud ing c o s t -o f - l i v in g a l l ow anc e

and prem ium s for overtim e and weekend work, etc.

5 Week ended D ecem ber 7.

6 Week ended D ecem ber 5.

7 (Decem ber 1963 + D ecem ber 1964) (Decem ber 1964 - D ecem ber 1963)

8 2 ) ~ ( 4 )•

(Decem ber 1963 + Decem ber 1964) (Decem ber 1964 - D ecem ber 1963)

( 2 ) + ( ~1 )•

9 For process w orkers, col. 1 x col. 4 x 48.2; for general and maintenance w orkers, col. 1 x col. 4 x 47.7; and for

salaried em ployees, col. 1 x col. 2 x 47 .1. To the extent that 48.2, 47 .7, and 47.1 are less than 52, allowance is made

for days not worked but paid for because of sickness, holidays, or vacations.

I F or p rocess w orkers, col. 1 x col. 5 x 49.7; for general and maintenance w orkers, col. 1 x col. 5 x 49.2; and for

salaried em ployees, col. 1 x col. 5 x 47.5. To the extent that 49. 7, 49.2, and 47. 5 are less than 52, the allowance is made

for days not worked but paid for because of sickness, holidays, or vacations.

II A survey by the M inistry of Labour indicates that supplementary benefits accounted for 13.4 percent of total labor cost 

for wage earners and salaried em ployees together in 1964. The following items were included in the survey as supplementary 

benefits: Holidays and vacations, absence due to sickness and injury, statutory National Insurance contributions, private social 

welfare payments, payments in kind, subsidized serv ices, recruitm ent and training expenses, profit sharing bonuses and paym ents, and other labor cost. It is assumed here that 13.4 percent of both wage earner labor cost and salaried employee 

labor cost is in supplementary benefits.

12 Partially estimated on the basis of data furnished by the Iron and Steel Board.

13 Includes approxim ately 6,000 workers in p rocesses not covered by this study, but included in the U. K. definition of 

the steel industry.

14 Excludes some central administrative offices.

SOURCE: Based on data from Iron and Steel Annual Statistics, 1964 (London, Iron and Steel Board and the British Iron 

and Steel Federation), and from the M inistry of Labour, in conjunction with aggregate data furnished by the British Iron 

and Steel Board.

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Table B -2 4 . U nited K ingdom . E stim a tes o f T otal H ours W orked,

U. S. Industry D efin ition , 1 Iron and Steel Industry, 1964

Average

Average

weekly Total hours worked

W orker category number

of persons

at work 2

hours

worked

December

1964 3

Minimum

estimate *

Maximum

estimate 5

(1) (2) (3) (4)

P rocess w ork ers---------------------------------------------------------------------------- 119,856 _ 260,347,046 268,449,135

Coke ovens at blast fu rn aces--------------------------------------------------— 4, 866 42.8 10,038,373 10,350,771

Blast furnaces and sintering p la n ts ------------------------------------ —

Steel melting furnaces and ancillary p rocesses (excluding

10,808 43. 1 22,452,765 23,151,503

melting for manufacture of steel castings)----------------------------

Rolling m ills and ancillary processes (excluding wrought 

iron, sheet, and tin plate rolling but including

20,559 43. 3 42,907,881 44,243, 189

bright b a rs )—--------------------------------------------------------------------------- 49,386 45.9 109,260,579 112,660,805

Sheet m ills --------------------------------------------*----------------------------------- 12,832 45. 0 27,832,608 28,698,768

Tinplate m anufacture----------------------------------------------------------------

Steel tubes, pipes, and fittings (excluding welded tubes

3, 142 42.8 6,481,840 6,683,557

over 16 inches outside d ia m eter)-------------------------------------------

General and maintenance workers associated with

18,263 47. 0 41,373,000 42,660,542

above p r o c e s s e s --------------------------------------------------------------------------- 68 9 .134 7 46. 1 196.002.973 202.166.588

Total wage earners ----------------------------------------- -------------------

, Salaried em ployees:

Administrative, technical, and clerical em ployees

208,990 456,350,019 470,615,723

associated with above p rocesses 8 -------------------------------- 6 50. 017 7 39. 1 92.111.822 92.894.088

Wage earners and salaried em ployees, total------------------------------- 259,007 - 548,461,841 563,509,811

1 But excluding wire and wire products.

2 Average of figures relating to 1 week in each month.

3 Week ended D ecem ber 5.

4 For process w orkers, col. 1 x col. 2 x 48.2; for general and maintenance workers, col. 1 x col. 2 x 47.7; and for

salaried em ployees, col. 1 x* col. 2 x 47.1. To the extent that 48. 2, 47.7, and 47.1 are less than 52, allowance is made

for days not worked because of sickness, holidays, or vacations.

5 F or p rocess w orkers, col. 1 x col. 2 x 49.7; for general and maintenance workers, col. 1 x col. 2 x 49.2; and for

salaried em ployees, col. 1 x col. 2 x 4 7 .5. To the extent that 49.7, 49.2, and 47.5 are less than 52, allowance is made

for days not worked because of sickness, holidays, or vacations.

6 Partially estimated, on the basis of data furnished by the Iron and Steel Board.

7 Includes approximately 6, 000 w orkers in processes not covered by this study, but included in the U. K. definition of

the steel industry.

8 Excludes some central administrative offices.

SOURCE: Based on data from Iron and Steel Annual Statistics. 1964 (London, Iron and Steel Board and the British Iron

and Steel Federation), in conjunction with aggregate data furnished by the British Iron and Steel Board.

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Table B—25. United Kingdom. Estimates of Average Hourly Labor Cost for Wage Earners and Salaried Employees,

U. S. Industry Definition, 1 Iron and Steel Industry, 1964

Employment

cost

(thousands of

pounds 2) 3

Hours Average hourly labor cost

Worker category worked

(thousands) 4 In

pounds 2

In

shillings

and pence 2

In

U. S, 

dollars 2

Wage earners; s. d.

Wages;

Minimum----------------------------------------------------------------- 185,382.3 456,350.0 0.4062 8 1 1. 13

Maximum---------------------------------------------------------------- 196, 036. 1 470,615.7 .4166 8 4 1. 16

Total cost;

Minimum----------------------------------------------------------------- 214,067.2 456,350.0 .4691 9 5 1. 31

Maximum---------------------------------------------------------------- 226,369.6 470, 615. 7 .4810 9 7 1. 34

Salaried employees;

Salaries;

Minimum----------------------------------------------------------------- 41,273.6 92,111.8 . 4481 8 12 1.25

Maximum ---------------------------------------------------------------- 43,334.7 92,894.1 .4665 9 4 1. 30

Total cost:

Minimum----------------------------------------------------------------- 47,660.1 92, 111.8 . 5174 10 4 1.44

Maximum---------------------------------------------------------------- 50, 040. 1 92,894.1 . 5387 10 9 1. 50

Wage earners and salaried employees:

Wages and salaries:

Minimum----------------------------------------------------------------- 226,655.9 548,461.8 .4133 8 3 1. 15

Maximum---------------------------------------------------------------- 239,370.9 563,509.8 . 4248 8 6 1. 19

Total cost:

Minimum----------------------------------------------------------------- 261,727.3 548,461.8 . 4772 9 6 1. 33

Maximum--------------------------------------------------------------- 276,409.7 563,509.8 . 4905 9 10 1. 37

1 But excluding wire and wire products.

2 US$ 1 = 0. 3584 pound; 1 pound = 20 shillings; 1 shilling = 12 pence.

3 From table B—23;

4 From table B—24.

Table B~26. United Kingdom. Calculation of Unit Labor Cost for Wage Earners and Salaried Employees,

U. S. Industry Definition, 1 Iron and Steel Industry, 1964

Employment

cost

(pounds 2) 3

Weighted output Unit labor cost per ton

Worker category (thousands of

British standard British standard ton4 Short ton 4

tons 4) 5 6 In

pounds 2 6

In U.S.

dollars 2

In

pounds 2

In U. S.

dollars 2

Wage earners:

Wages:

( 1 ) (2 ) ( 3 ) (4) (5) (6)

Minimum-------------------------------------------------- 185 , 3 8 2 ,3 0 0 1 9 , 328 . 1 9 .5 9 26. 76 8. 56 2 3 . 89

Maximum-------------------------------------------------

Total cost:

196 , 0 3 6 ,1 0 0 1 8 , 280 . 5 1 0 . 74 29.92 9. 58 26. 71

Minimum-------------------------------------------------- 2 1 4 , 0 6 7 ,2 0 0 1 9 , 328 . 1 11. 08 30. 90 9. 89 27. 59

Maximum-------------------------------------------------

Salaried employees:

Salaries:

226 , 3 6 9 ,6 0 0 1 8 , 280 . 5 1 2 . 38 34. 35 11. 06 30. 85

Minimum_________________________________ 4 1 , 2 7 3 ,6 0 0 1 9 , 328 . 1 2 . 14 5. 96 1. 91 5. 32

Maximum-------------------------------------------------

Total cost:

4 3 , 3 3 4 ,7 0 0 1 8 , 2 8 0 .5 2 . 37 6. 62 2. 12 5. 91

Minimum-------------------------------------------------- 4 7 , 6 6 0 ,1 0 0 1 9 , 328 . 1 2 .4 7 6. 88 2. 20 6. 14

Maximum-------------------------------------------------

Wage earners and salaried employees:

Wages and salaries:

5 0 , 0 4 0 ,1 0 0 1 8 , 280 . 5 2 . 7 4 7. 64 2. 44 6. 82

Minimum-------------------------------------------------- 2 2 6 , 6 5 5 ,9 0 0 1 9 , 328 . 1 11.73 32. 72 10. 47 29. 21

Maximum-------------------------------------------------

Total cost:

239 , 3 7 0 ,9 0 0 1 8 , 280 . 5 1 3 . 09 36. 53 11.69 32. 62

Minimum-------------------------------------------------- 2 6 1 , 7 2 7 ,3 0 0 1 9 , 328 . 1 1 3 . 54 37. 78 12. 09 33.73

Maximum------------------------------------------------- 276 , 4 0 9 ,7 0 0 1 8 , 280 . 5 1 5 . 12 42. 19 13.50 37.67

1 But excluding wire and wire products.

2 US$ 1 = 0. 3584 pound.

3 From table B—23.

4 1 British standard ton = 1.12 short tons, or 1 short ton = 0.8929 British standard ton.

5 Figures from table B—22 reduced by l/ 53 , to adjust for 53-w'eek year to which the output data apply.

6 Col. 1 4- col. 2.

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Table B—27. United Kingdom. Man-Hours per Ton and Output per 1, 000 M an-Hours, 

U.S. Industry Definition, 1 Iron and Steel Industry, 1964

W orker category Hours 

worked 2

Weighted

output

(thousands of 

British standard 

tons 3 ) 4

M an-hours per ton

British

standard

ton35

Short ton 3

(1) (2) (3) (4)

Wage earners:

M inim um -------------------------------------------------------------------------------- 456,350,019 19,328.1 23. 61 21. 09

M axim um ------------------- ---------------------------------------------------------- 470,615,723 18, 280. 5 25. 74 22.99

Salaried em ployees:

M inim um ------------------------------------------------------------------------ ------- 92, 111,822 19,328.1 4. 77 4. 23

M axim um ------------------------------------------------------------------------------ 92,894,088 18,280.5 5. 08 4. 54

Wage earners and salaried em ployees:

M inim um -------------------------------------------------------------------------------- 548,461,841 19,328.1 28. 38 25. 34

M axim um ------------------------------------------------------------------------------ 563,509,811 18,280.5 30. 83 27. 52

Calculation of m an-hours per ton

Calculation of output per 1,000 m an-hours

Weighted

output

(thousands of 

British standard 

tons 3) 4

Hours 

worked 2

Output per 1, 000 m an-hours

British 

standard 

tons 3 5

Short tons 3

(1) (2) (3) (4)

Wage earners:

M inimum------------------------------------------------------------------ ------------- 18,280.5 470,615.7 32. 84 43. 51

M axim um ------------------------------------------------------------------------------ 19,328. 1 456, 350. 0 42. 35 47. 44

Salaried em ployees:

M inim um -------------------------------------------------------------------------------- 18,280.5 92,894.1 196.79 220. 40

M axim um ------------------------------------------------------------------------------ 19, 328. 1 9 2 ,111.8 209.83 235.01

Wage earners and salaried em ployees:

M inim um -------------------------------------------------------------------------------- 18,280.5 563, 509. 8 32.44 36. 33

M axim um ------------------------------------------------------------------------------ 19, 328. 1 548,461. 8 35. 24 39.47

But excluding wire and wire products.

From table B—24.

1 British standard ton = 1. 12 short tons, or 1 short ton = 0.8929 British standard ton.

Figures from table B—22 reduced by Vs3» to adjust for 53-week year to which the output data apply. 

Col. 1 4 - col. 2.

☆ U. S. GOVERNMENT PRINTING OFFICE : 1968 O - 296-356

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