WELLINGTON NEWS

Hokitika Guardian, 3 November 1928, Page 2

WELLINGTON NEWS

WAGES AND PRODUCTION

[Special To The Guahdian.]

WELLINGTON. November U. In the ultimate analysis the c<rst of any article is all wages or nearly all, and the wage level in any country determines, broadly speaking, the price level. According to the statistics of the International Labour Bureau the comparative real wages in the different countries are, taking London as 100. Amsterdam 87. Berlin 02, Brussels 45. Paris, 57, Prague 52, and Warsaw -12. No wonder' Britain finds it difficult to compete in the world’s market with European countries! ‘ .In England the Labour leaders are beginning to realise that unemployment is inevitable so long as the price level of commodities is above that of competitors. A very interesting economic development is now taking place in Norway. During the past few months a number of industrial plants and mills were forced.out of business on account ol high production costs and some ol these have been taken over by the trade Unions concerned. In respect to one timber mill , the men got together a small share capital, and the remainder of the money required was partly guaranteed by the National Association of Trade Unions. It was agreed that during the initial period the men are to receive wages which are 20 per cent below the trade union minimum, so as to place the mill on a competitive basis and to enable it to consolidate its financial position. In another cnso about seventy men are employed, and these men will receive no wages until cash has been received on account of order—that is about thirty days after delivery. In another case the municipal authorities ■•■ have been asked to guarantee the money required, which will be repaid by the men, who are to surrender 25 per cent of their wages evey week until The guarantee has been fully covered. ■ K In each case it will lie seen that pro'duction costs are reduced by attacking wages, and that is the only way that 'costs can bo reduced. Up to the present the men fought against Hvfige reductions, no matter how badly the industry concerned was situated. Wages are sacrosanct in New Zealand and Australia, even on relief works the full award wage rate is demanded. .Costs of production cannot he lowered :Uiitil the Labour leaders appreciate the i'a'et that the wages problem belongs to the realm of economics and not politics, •It is utterly impossible to get the average worker to realise that a reduction : in wages does not necessarily mean a deduction in the standard of living, but fit does mean a reduction of production costs and a reduction of the price level •of commodities. Wages, salaries, etc. are all too/high, in Australia and New Zealand, according to an authority, and until adjustments are made unemployment is bound to continue. - : -BEET SUGAR-GROWING, The efforts to reduce costs of production in every country are manifest, and science is being pressed into service. It .is quite possible to reduce costs of production by the simple process of reducing wages and salaries, and that is the only course open to many industries just now.To reduce wages is a difficult and thankless job, and therefore it is probably that unemployment will he a feature of the . economic life not only of New Zealand, but also ol several other countries also. Science is not only helping to cheapen costs ~but is also helping to introduce new industries and artificial silk is one of these. To us in New Zealand it is not so much a case of secondary industries as primary industries that require attention. Years ago when the late R. J. Seddon was Premier and Colonial Treasurer of New Zealand, his budgets for two or three years contained reference to the “Poet Sugar Industry ” aiul a subsidy was offered loi this 1 purpose but. it led to nothing because (if the expense involved.

Now the position of the industry has undergone a great change. Up to the present it has been the practice to deal with the beets when fresh and so sugar extraction had to be done in three •months. Such an industry could pot therefore be started in New Zealand because of the labour problem. Under the auspices of the Agricultural Institute of the University of Oxford, the first really practical and successful system of drying bets has been developed, 'this being largely the invention olf Dr B. J. Owen. By this drying of beet ’the process of manufacture can be carried on all the year round, which reduces or spreads the cost. During last spring about 4000 tons of boot were successfully dried .though the greater part of this quantity had suffered considerably through frost. Sugar of the finest quality has been made on commercial lines (from these dried beets, or “ cossettes ” -as they are technically called. This is a matter that should be investigated, for d the industry can he established hero it will give farmers another profitable side line to deal with. An effort is being made in Auckland to establish tobacco culture and tbe curing of the leaf for manufacturing.