Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-01-24
INSURANCE URGED
IN UNEMPLOYMENT
Clark, Dodge & Co. Believe
Provision Should Be Made
for Idle Workers.
Special Dispatch to The Star.

NEW YORK, January 24-In the
current issue OF Financial g. Economic
Review, Clark, Dodge & Co. conclude
that industrial expansion of the past
few years has accentuated the unem-
ployment problem. The organization
of some effective plan to avoid the
repetition of periods of acute contrac-
ton in buying power caused by un-
employment seems imperative.
at is generally conceded that the
unemployment situation is bad. In
fact, indirect evidence, such as the
decline in industrial and commercial
activity, the drop in the employment
index published by the Bureau of
Labor and the known shrinkage in
pay rolls throughout the country indi-
cate that unemployment is probably
more extensive now than it was in
1921.
Shrinkage in Farmers.
"Wage and salary earners in 1880
suffered a shrinkage in dollar income
which amounted to an estimated total
of about $4,000, 100000 compared with
1929. A part of the reduction has been
due to cuts in wages. but by far the
greater portion can be accounted for
by total or partial unemployment.
Obviously, this loss of income by those
normally employed, coupled with the
restraining effect of uncertainty in the
minds of those who have jobs, consti-
tutes one of the most outstanding
adverse influences that obstruct the
flow of goods from producers to con-
sumerS.
1.-The estimated number of available
non-agricultural wage and salary earn
ers in the United States in 1921 was
1898, 900. Approximately Is per cent
we're out of employment at the peak of
the depression. Making allowance for
the normal increase since 1921, the
present estimated total available supply
Is between "a and IS million. The
most popular figure on the present
number of unemployed is about $780,
600. Some assert that 100000 are
out of work. A British statesman, ap-
plying the British standard of employ
ment to this country, estimated that
theoretically as many as 100000
Americans are unemployed. Obviously
the actual number of unemployed varies
in accordance with the Interpretation
of unemployment data.
with return of normal business the
problem will assume less impressive
aspects and over a period of years the
continued restriction of immigration
together with a declining birth rate,
will in some measure alleviate over
supply of labor. In the meantime labor
is confronted with the problem Of be-
coming adjusted to conditions as they
exist today. In the depression of 1921
unemployment exceeded all previous
proportions Cost of living declined
and industrial wages we're reduced on
the average about 20 per cent. But
since 1921 this country has evolved a
new philosophy, the giSt of which is
that high wages are the basis Of pros
perity. Representatives of capital de-
sire prosperous workers to consume the
in turn are always seeking high wages
to obtain the maximum benefits from
their efforts.
Dollar wages increased 125 per cent
between 1914 and 1929. Dollar wages
increased during this period more
rapidly than cost of living. AS a re-
suit real wages advanced on the average
nearly 40 per cent, so that wage earners
have received in recent years large
surplus income which has accrued either
as savings or as surplus funds available
for buying products other than those
absolutely essential for living expenses.
Decline in Wages.
I'm the depression of 1921 the de-
cline in wages was temporarily greater
than the proportionate drop in living
costs. AS a result there was a loss in
real wages which, however, was soon
recovered in the period of revival fol-
lowing the depression. While no one
questions the ACCESSIBILITY of maintain
ing our relatively high standard of
living a question of paramount i'm
portance Is whether there are similar
economic forces at work today which
will enable this country to continue to
maintain wage level as far above that
of other countries as has prevailed in
recent years.
1.-THE operation of economic laws will
ultimately afford a sound solution to
the controversy over wage levels. The
immediate problem is to evolve some
plan that will tend to equalize peaks
and valleys of the wage earner's income.