The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1931-04-30

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AS one successful business man to others, Secre-
tary OF Commerce Lamont reminded the National
Chamber of Commerce convention in Atlantic City
Wednesday that our greatest periods of prosperity
always have been bought with high wages and
shorter hours.
In other words. ali the Hoover administrations
talk about necessity of the high wage-shor hour sys
tenn is not matter of charity sentimentality, but
OF hard business sense
The reason is clear. Profits depend on turnover
Mass production depends on mass consumption. The
problem is not how to make more goods, but how to
sell more goods
IF millions of workers are out of employment for
year, through loss Of wages their buying power is
cut by billions of dollars" Secretary Lamont
planned. "If the income of the remaining millions
who still are employed is cut 10 per cent through
part-trne work. the loss amounts to several more
billions
Add to this great loss in buying power the re-
trenchment due to fears and uncertainties of such
period and the total loss of purchasing power becomes
q staggering amount"
Emergency plans to combat this condition, such
the half-billion-dolar federal building program
are valuable as temporary expedients. But have no
permanent value.
The solution, from the point of view of general
business, is to reestabsh the high purchasing power
of the market. That can not be achieved by
putting men to work at lower wages and thus con-
tinuing to restrict their purchasing power.
The wage level must be kept up to the prosperity
level, or the merchants can not sell and the manu-
facturers not produce proftably under mass pro-
duction conditions
To spread the purchasing power over a larger
number Of workers than those now employed, econ
omsts and wise industriasts point out that the
day or work week must be shortened. That takes up
the slack caused by increased machine productivity
and chronological unemployment.
Some employers object that this can not be done
without destroying profits But they should be open
minded enough to consider the experience of such
companies as Kellogg of Battle Greek and of E. R.
Squibb & Sons.
The annual report of the squibb company, issued
Tuesday, shows an increase of profits of half mil
lion in $780, despite the depression and introduction
of the fve-day week without wage reductions The
superior efficiency of the ve-day week is explained
as follows:
Theoretically the five-day week represents
tailment of the working hours Of per cent Or stated
differently an increase in wages of per cent, and
hence it might be anticipated that labor costs of
production would rise by this amount.
But in large operations where we can maintain
an actual checkup efficiency it found that
production in the fve-day week amounted to 981A
per cent of the production heretofore attained in five
and one-half days.
COR that rs per cent Of the per cent cut in
working time was picked up in the added efficiency
of the 1ve-day week. Today your company oper-
ates at the lowest cost per dollar of sales in It's
history"
Here is the testimony of Lewis j. Brown, president
of the Kellogg company, the experience of that
organization in going from three to four-shift
day without wage cuts that is from an eght-hour to
q six-hour day:
1.-THE plan has proved so satisfactory that, so far
as we can see now, we shall adopt the six-hour day
as permanent operating policy. 1t is profitable
operating pan profitable for the workers and equally
profitable for the business, due to the increased
operating efficiency and the lowered cost per unit
of production"
Obviously, the Squbb 1ve-day-week plan and the
Kellogg six-hour-day plan are not Immediately ap
plicable to all industries. The Squbb plan is more
applicable to some industries, and the Kellogg plan
to others And neither would be at once practicable
in some industries because of special competitive
local conditions.
But that American industry as whole is headed
toward shorter work period for the employees seems
inevitably to follow from our previous successful
transition from the twelve to the eght-hour day.
II our practical experience of the past means any,
thing then that way lies the road of greater future
prosperity.