WELLINGTON NEWS

Hokitika Guardian, 23 May 1928, Page 3

WELLINGTON NEWS

UNEMPLOYMENT INSURANCE 1

(Special to “ Guardian.”) WELLINGTON,. May 21. Unemployment seems to be the experience of all countries just now and it is much worse in some than in others. Unemployment is pretty general in Australia, and if the truth woir known it is worse there than in New Zealand where it is had enough. T here is some similarity between Australia and the Dominion so far as their economic positions aid concerned. Australia has experienced a good season just like New Zealand, for both countries export the same .class of produce, and if anything the exports from Australia are more varied. The overseas trade of both countries and exports exceed imports, although the excess shown hv Australia does not equal the excess shown by New ZisaiancV

The banking figures in both countries are .satisfactory and both countries have been working under systems of compulsory arbitration and both enjoy protectionist tariff, Australia to a greater extent than this Dominion. Both in Australia and this country loan expenditure by the Governments has been excessive and there is nn immediate prospect of any reduction. Under these conditions there should be a mini.miini of unemployment, but tho reverse is the case. In our own ease wc have had an increase in production, good prices for our exported products, the trade balance is largely in our favour, tin? hanks have ample funds with which to meet nil reasonable demands for accommodation and business on tbe Stock Exchanges was never so active, and prices never firmer, yet there is according to reports an unprecedented number of unemployed. There must be some explanation tor the phenomena. The cessation of seasonal activities N responsible for some of the unemployed, but there is nothing new in that, for such works have always closed down for the season. The reason must he looked for in other directions, and one reason for unemployment must be attributed to the Arbitration Court, for tho award wages are generally above what the people are able to afford. How to bring down costs of production—and wages make up more than three parts of that cost, is the problem. Unemployment insurance will not solve the problem, and insurance is only beneficial in seasonable occupations and casual unemployment. Short hours and high wages are two of the main causes of unemployment, both in New Zealand and Australia.

Tho unemployed cannot he allowed to starve and so refief works are provided. But relief cannot coiuinue indefinitely, and relief work must ho so arranged that there is no inducement for 1 1le worker to remain on them if he can gel another job; to provide them with award wages would defeat the whole object of relief works. Unemployment, is a very bard problem to solve, and the economist can offer no pros! riptinn. The suggestion of Lord Asquith appears to

he the most effective method of meeting the- situation. Ho suggests unity r>f purpose and co-operation between employer and employed in each trade, -o that in lime of prosperity mutual arrangements may be made to deal with persons engaged in the' industry in time of adversity, each trade arriving at its own .scheme. AMALGAMATION.

It is rumoured that three or four of our local insurance companies are about to amalgamate, hut there is no means of ascertaining whether there is any foundation in fact for the rumours. However, should it turn out to lie correct, it would he in keeping with the general trend of business. Merger or amalgamation was a spasmodic affair before the war. while now it is pretty general with hanks, insurance and finance companies and practically all classes ol industries. The scheme has gone further, for so far as industries are concerned it has •becomo international. There was a time when combines were regarded as inimical to the public welfare, and in many countries anti-trust laws are in existence. It is recognised now that combination is beneficial provided the combine has its main objective the cheapening of goods and service and giving the public a fair deal.