Great Falls tribune. [volume] (Great Falls, Mont.) 1921-current, 1922-12-24

the part of employers, even when they
did not see the way clear to raise
wages, to consent to their sterilization
at the present or the preceding levels.
This situation is likely to continue for
the first six months of 1923, going far
enough to owe the usual wage set
Elements which come up in the spring.
Increased Production Costs
Employers, therefore, are going to
be confronted with demands which, if
creased production costs. In 1917 and
Labor was getting scarce; business was
running along briskly, and the demand
for increased wages wal insistent. At
that time, my advice to business men
was, that they should make terms with
labor as quickly as possible, 30 as to
keep their factories running and turn
out the stuff. The costs were charged
ND to the consumer. This advice, the
business men of the country cheerfully
took, even to the extent of improving
upon it.
"At the present time my advice is
directly opposite. Under no conditions
should wage rates be increased. if it is
at all possible to avoid it. A wage rate,
once established, is a milestone about
an employers neck. The fundamental
long swing tendency Of wages and Of
commodities is downward This pres
emit stiffening Of conditions is but an
eddy in the main stream. A year from
now, perhaps, the lower price tendency
will again be resumed. The empioyer
who has allowed himself to be weighted
down with increased wage rates Will
find himself at 4 disadvantage when
the downward tendency is again re-
sumed.
IF, therefore, you must pay more
for your help, in order to secure labor
and keep the peace" continued the
statistician, do it by some kind Of
a bonus which will be eliminated auto
matically when the turn comes. In
1917 and 1918 you could pass the
cost on to the public, but that time
has gone. The public is not looking
for goods at any price; it is looking
for goods at a lower price, and if
your goods are put into the market on
the basis of increased production costs
they will not find a ready sale.
Investors Cautious
Furthermore, investors are going
to be extremely cautious about put
ting their funds into industrial enter
prises. They are going to ask a great
many p%erpiexing and embarrassing
questions. First among these is going
to be the question as to how far the
particular plant has got its produe-
ton down to a permanent level. These
questions are going to be asked strict
ly from the dividend paying basis.
On all sides the profit-making posi-
bilities of productive enterprises are
going to be curtailed. Your normal
margin of profit in the years just
ahead of us is going TO be very much
less than it has been for the last five
years. ANY element, therefore. which
tends to increase production costs is
going to add to the embarrassment Of
your company. For this reason. in
vestors are going to look beyond the
advertisements as TO the assets and
income and things of like kind. They
are going to ask to see your wage
sheets and to demand information as
to how the wage levels under which
you are operating correspond with
those of six months and q year ago.
and upon the answer to it will depend
not only the profits which YOU will
make in 1923 but also the difficulties
which you will meet in obtaining mon
ey to finance your operations
General business according to the
index of the Babsonchart has sagged
slightly from exact normal reached
last week. The current reaction of
two per cent is due to increase in fall
ures.