supplemented by the fact, brought to light by the Pittsburgh Survey, that while the wages of the Southern and Eastern European laborers in the steel mills have increased, the wages of the semi-skilled and skilled men-mostly Americans or old immigrants of the English-speaking races -have remained stationary, which is in effect equivalent to a lowering of the standard of wages; and the money wages of the labor aristocracy, none of whom are Southern and Eastern Europeans, have been actually reduced. The same tendency is observed in the unionized coal mines of the Pittsburgh district: the wages of the unskilled men are much higher than those paid for the same grade of labor in the steel mills, whereas the wages of the skilled men are the same in the mills and mines for work of the same class. In the coal mines, as in the steel mills, unskilled work is done almost exclusively by Southern and Eastern Europeans, while the skilled men are mostly of the "English-speaking" races.2

To be sure, there is a continuous readjustment of wages to prices. The employer of labor seeks to recoup the advance in wages, by advancing the price of his product to the consumer. When the advance in the price of manufactured products becomes general, the wage-earner, as a consumer, is forced in effect to give up a part or all of his gain in the money rate of wages. The increased cost of living then stimulates further demands for advances in wages. Since combinations of capital in all fields of industry have reduced competition among employers of labor to a minimum, the wage-earners have been at a disadvantage in this continuous bargaining. The Immigration Commission holds that the bargaining power of labor has been impaired by "the availability of the large supply of recent immigrant labor," which "has undoubtedly had the effect of preventing an increase of wages to the extent which would have

This subject is specially treated further, in Chapter XX., on the Steel-Workers.

See Chapter XXI., on the Coal Miners.

been necessary had the expansion in the local industries occurred without the availability of the Southern and Eastern Europeans."'

Instead of conjecturing what "would have resulted . . from the increased demand for labor," under imaginary conditions, it is safer to inquire what were the actual effects of business prosperity on wages in past American history "without the availability of the Southern and Eastern Europeans." A fair basis for comparison is offered by the Civil War period. "With the exception of the first year, the Civil War period was one of prosperity in manufactures, transportation, mining, and agriculture. Profits were large

New woolen factories were opened; many were operated day and night. Dividends of ten to twenty per cent were common; and larger returns were not unknown."3 On the other hand, the cost of living rose as rapidly as in recent years; though the causes were different, the effect upon the wage-earner's budget was the same. The wage-earners were apparently in a favorable situation: "The war caused an unprecedented drain of workers from the productive industries into the army,"4 whereas immigration dropped during the first two years.5 The effect of that situation on wages is shown graphically in Diagram XIX., reproduced in part from Chart XII. of

1 Reports, vol. 8, p. 440. The sentence is self-contradictory in form, presuming to state "the effect" which a hypothetical condition "has undoubtedly had", although, as a matter of fact, the combination of causes which "would have" made the effect "necessary" never occurred. This idea is not original with the Immigration Commission. It is referred to in the following terms by Prof. Commons in his report on immigration: "It is possible, of course, that the presence of immigrants in large numbers may prevent wages from reaching as high a level in time of prosperity as they otherwise would reach, but this cannot, in the nature of the case, be demonstrated.”—Reports of the Industrial Commission, vol. xv., p. 309.

2

Reports of the Immigration Commission, vol. I, pp. 540–541.

3 Frank Tracy Carlton: The History and Problems of Organized Labor, pp. 52-53. 4 Ibid., p. 51.

s Reports of the Immigration Commission, vol. I, pp. 79–80.

Southern and Eastern Europeans," does not fit the facts of American economic history.

The facts brought to light by the investigations of the Immigration Commission furnish ground for the assumption-paradoxical as it may seem at a superficial glance— that the availability of the large supply of recent immigrant labor has prevented a reduction of the wages of the older employees.

The prime force which has made industrial expansion so rapid in recent times has been the general introduction of labor-saving machinery. The immediate effect of the introduction of every new machine has been the displacement of the trained mechanic by the unskilled laborer. To be sure, the cheapness of machine-made products stimulates consumption of manufactured goods and creates an increased demand for labor, which in the long run offsets the loss of employment caused by the introduction of machinery. But this is true only on the assumption of a considerable industrial expansion. To use bituminous coal mining as an example: in the mines of West Virginia a team of two skilled pick-miners can produce 10 tons of coal a day; but, where machine mining has been introduced, one machine runner with one helper and eight loaders can turn out 50 tons a day. Accordingly, if a force of 100 skilled pickminers produced 500 tons of coal per day, the same output would be produced with the aid of machinery by a force of 20 skilled machine men and 80 laborers. It may be assumed that the requisite number of common laborers would be found in the home market. In order to provide skilled work for the 80 pick-miners displaced by the machine, the daily output of coal must be increased to 2500 tons, which would require an additional supply of 320 unskilled laborers. Suppose, through restriction of immigration, the additional supply of unskilled labor were cut down one half. The total available supply of labor would then consist of the 20 pick

I

Annual Report of the Department of Mines, West Virginia (1909), pp. xi., 73, 152, 153.

miners who might find employment as machine runners and helpers, the 80 laborers who would displace an equal number of pick-miners, the 80 pick-miners displaced by the machine, and an additional supply of 160 unskilled immigrant laborers, in all 340 men. The force of operatives could then be increased only to 34 teams, consisting of 68 skilled miners and 272 laborers; there would be only 48 vacancies of a higher grade for the 80 skilled miners displaced by machinery; and the remaining 32 would have to accept employment at loading coal-of course at the usual wages paid for common labor. The fact noted by the Immigration Commission, that only "a small part" of the old employees, consisting of the inefficient element, are in competition with the recent immigrants, is of course the "result of the expansion of the industry," which has opened to "the larger proportion" opportunities for "advancement to the more skilled and responsible positions." These opportunities, however, were conditional upon the availability of a proportionate supply of immigrant labor for unskilled and subordinate positions.

1 Reports of the Immigration Commission, vol. 1, p. 236.