Evening star., 1941-04-20
Technology Problems Called
Primary Threat to Democracy
Mass of Unemployment, Constantly Increased by
Technologica Displacement of Labor
Preceded Naz Social Change
Bv Richard L. Stokes.

sumed to be inherent in our economic
system. Estimates of unemployment at
the beginning of 1910 range from $780,
900 National Industrial Conference
Board) to nearly 100000 Congress Of
Industrial Organizations.
3. Among benefits promised by eco
nomic theory to offset the evils of the
machine are lower prices, higher wages,
shorter hours and development of new
industries.
4. Refusal to make use of price redUc-
tions is characteristic of mechanical in
dustry. Price-fxing agreements among
competitors are the rule rather than
| exception.
Unit Labor Costs Drop.
| 5. Even during periods of greatest wage
increases. unit labor costs decline, be-
cause advances in average hourly earn
| ings are generally exceeded by still
| greater increases of output per man
| hour
g. Further curtailment of working
hours is distinctly remote, since legisla-
ton has established and public opinion
has accepted, the 4O-hour week as the
norm of employment.
7. With the possible exception of the
Diesel engine, there is in sight no great
new industry offering promise of taking
up any significant proportion of unem-
ployment.
8. While technology creates tremen-
dous economic problems through labor
displacement, it also induces concentra-
ton which impedes the operation of
price reductions.
9. A state of serious unbalance exists
today. Under present conditions it is
likely to continue and to become even
more pronounced.
Unemployment Problem.
TO- The persistence of mass unemploy-
ment in the United States, despite
marked economic recovery, and the
growing emphasis on chronological ad-
vance should cause grave concern to all
thoughtful persons who seek the preser-
vation of democracy.
One feature of the machine era which
kept it's direction virtually unchanged
through boom and depression, according
to the report is that less and less labor
has been required from year to year to
produce a given amount of goods.
The curve of labor productivity has
varied only in rate of acceleration,
which has continued even when total
amount of production fell The report
studied 40 manufacturing industries and
found that in most of them output per
man-hour has steadily increased since
1929, while production as a whole de-
clined in 26 out of 40. These facts, it is
argued, "strikingly indicate the rapidity
and intensity with which chronological
Improvements were introduced"
A fundamental tenet OF economic
thought, the report declares, is that
over a long-term period chronological
unemployment is offset by lower prices
Of commodities, with a resultant in
crease of production and re-employ-
ment. This is partly true, the study
finds, in n-concentrated industries,
such as furniture and cotton, wooden
and worsted goods. Here unit labor
requirements and price indices have
tended to fall together and remain
parallel.
Prices Kept Infiexible.
The picture is not the same in con-
centrated industries among which are
cited iron and steel, nonferrous metals,
cement, motor vehicles, cigarettes and
electric light and power The trend in
this field since 1919 is declared to have
been a precipitate fall in labor require
ments. while prices were kept relatively
infeXible
Price-fXing in concentrated indus
tries, this section of the report con-
CludeS, has helped make the problem
of unemployment particularly acute in
recent years Extensive declines in unit
labor requirements, it is affirmed, have
been met to a very limited extent only
by increases of production attributable
to price abatements So long as indus
trial prices maintain relative stability,
according to the T. N. E. c. economists,
their importance as a compensatory
force against chronological unemploy-
ment must be regarded as negligible"