Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-08-04
REPORTS OF WAGE
CUTS MULTIPLYING
Wall Street Believes U. S.
Steel Corporation Will Re-
duce Pay Schedule Further.
BIZ CARLTON A. sHIvELY.

Special Dispatch to The Star.
NEW YORK, August As dividend
reductions continue, Wall Streets dis
cussion Of wage cuts becomes louder.
Nearly every day brings reports of sal
airy or wage cutting, either openly and
straight out, or covertly. through en-
forced holidays and lengthening Of
hours
wall Street still believes that the
United states steel Corporation viii be
forced to wage reduction, after its pro-
posed salary cuts go into effect, pro-
vided the Autumn does not bring more
of q trade upturn than now seems
probable. So far the deepest cut by an
important company has been made by
the Colorado Fuel 81 Iron Co. with
16 per cent slash.
Strikes Unlikely.
Owing to the isolation of plants and
the comparative small number Of work
ers engaged in any one company, wage
reductions for industrial concerns are
unlikely to. bring on strikes more seri-
Gus than those now declared in textile
and coal mining centerS. Should the
railroads application for higher freight
rates fail, or II granted, should It be
found further relief would have to be
obtained through wage reductions, the
strike possibility would have to be con-
sidered. 1t IS an open secret the rail-
roads chose first TO ask for higher
freight rates rather than seek for wage
cuts. because some of them felt too
weak financially to stand the strain of
strikes, which most likely would have
resulted.
With its interests naturally on the
side of capital Wall Street has been
looking closely into the question of
comparative earnings Of capital and
labor. One railroad banker has pre-
pared some interesting figures on this
subject. He shows that railroad wage
earners received so per cent more in
wages In the 19l6-1929 period than
the net increase in productivity of rail-
road service. He figures equated traffic
mileS-25 unit of measurement for tons
Of freight and numbers of passengers
carried per mile of distance hauled
as having amounted to $3.50 in 1929,
an increase of $4,000 over 1916. De-
Quoting the increase in expenses, the
net increase was $4,000 eQuated traffic
salaries OF 10000, the difference coming
from reduced wages on capital.
Capital increased during the period
$3,l87 per employee, or % per cent over
1916. 1t accounted for great improve
ment in the property and In operations
and reduced the average hours of en-
ployes 1872 per cent, yet its return was
only 81 II per cent Of that of 1916. New
capital used by the railroads not only
failed to make anything, but old capital
paid less, and the sacrifice went into
larger wages.
Traffic Miles Gain.
EQuated trafic miles rose 70 per cent
In the period under review and per
wage Garner they rose Is per cent. The
rise was one-quarter of the per cent
OF increase of revenue per wage Garner.
because of the so per cent higher level
Of railroad rates in effect in 1929. The
increase in traffic miles per wage Garner
came about through more eflcient
operations and mechanical improve
ments. That meant an increase in
capital investment, which rose 80 per
cent actually and on wage Garner
basis % per cent. The increase in
capital investment per wage Garner was
twice as great as the gain in tran1c
miles That is, il took an increase Of
per cent of capital to enable the
worker to produce per cent more.
(CopyrfRht 1881