TRADE AND WAGES.

Taranaki Daily News, 21 May 1921, Page 10

TRADE AND WAGES.

FALLING FOOD PRICES. GERMAN COMPETITION. LORD INCHCAPE ON PRESENT SITUATION. London, March 3. In presiding at the annual meeting of the National Provincial and Union Bank Lord Inchcape emphasised the two points that excessive profits snatched during a boom have always to be paid for later on, and that excessive wages bring the penalty of unemployment. The demand for British goods, following the war-time supply of Japanese or American substitutes, he said, had been genuine, but the boom had been killed, because nobody, whether manufacturer, customer, Government, or workman, had oared about costs. People had acted as if trade and industry could stand any wages, and. as if there were some bottomless purse out of which the deficits on railways, mines and other controlled trades could be made good, and from which huge and costly schemes of social reform could be prosecuted at the same time. Hard facts had proved the contrary. There was bound to be a reaction. The resulting fall in prices had materially reduced the cost of living, and indicated the approach of more nearly normal conditions. The unsettling effects of the past year’s events would for some little time to come show themselves in the great social calamity of unemployment, but he believed that beneath the present distress and depression forces were at work which would restore industrial activity on a chastened basis, and that demand, killed by high prices, would be revived by low prices. Trade union restriction of employment, opposition to piece work, to overtime, limitation of output, and the too frequent absence among trade leaders of any spirit of co-operation had made it impossible for British industry to compete successfully in the world’s markets. COST OF LIVING. In the opinion of <Mr. C. A. M’Curdy, the Food Controller, the present fall in prices is real, and is likely to continue for some time. “The fall,” he said, “is not based on any superfluity of stocks in the hands of retailers or distributors, or any local conditions in any country. It is a world-wide fall, which starts in the great prairies of the Northern Hemisphere, where the world’s wheat crop is mainly grown. Wheat which cost 140 s a quarter a few months ago has fallen to-day to half that price.” The fact that foodstuffs are cheapening at the worst time of the year is looked upon as a good omen, for this foreshadows further falls as spring and summer bring larger supplies.

Government butter has now been reduced 3d per pound retail, and the home manufactured article is loxyer in sympathy, 3s 8d per pound being piad in many localities. In some places local dairy butter is said to be selling at less than 3s per lb. One prominent provision merchant is advertising imported butter at 2s Bd, and it is almost certain that many shops will be selling it at 2s lOd to 2s lid. At the beginning of the spring there is likely to be a further reduction.

The following reductions which have occurred within the last two or three months may be recorded: Butter, 4d per lbj eggs, Is 6d per dozen; bacor. 4c and 5d per lb; cocoa, 5d per lb; sugar, 5d per lb; jams, 2d to 4d per lb; syrup, 2d per lb; tinned fruits, 2d and 3d. Burma beans are being sold for less on the wholesale market than before the war, and rice and similar articles are also much cheaper. All classes of dried fruits have fallen substantially in price since before Christmas.

REDUCTION OF WAGES. There are many indications that the issue of a general reduction of wages in all the great industries will soon be put to the test. The Shipbuilding Employers’ Federation has held an important conference at Edinburgh, when the whole question of production costs was reviewed, and a suggestion that wages should be “cut” by as much as 25 per cent, was discussed. Miners’ wages are automatically falling, and efforts will be made to bripg about a still further reduction. Many collieries have closed down, and in others fourteen days’ notice has been given to the miners to terminate their contracts. The next few weeks will see some critical developments in many of the big industries on the wages question. Some trade unions will probably arrive at agreements under which reductions will take effect, but any all-round plan of reduction will be fought bitterly by Labor. AN OPTIMISTIC OUTLOOK. An optimistic view of the trade outlook was expressed at Northampton by Mr. Kellaway, head of the Department of Overseas Trade. He said he saw signs in our overseas markets in iia healthier direction. They were not very marked, and improvement was not going to be anything sensational, but trade was on the. turn, and during this year we should see improvements. Particularly was this the case in the Far East, India and the 'Southern States of America. Values were gradually getting something like normal, and they had to do so before we could see any recovery in export trade. That was the trend of all information reaching him. Suggestions regarding stabilising the exchanges, he said, lacked common sense. 'Exchanges indicated certain conditions, and one might as well try to stabilise a thermometer as try to fix a. rate of exchange artificially. It,.was no good talking about stabilising exchanges until the conditions which caused adverse exchanges were put right. On the question of export credits, he gave no hope of the Government propounding a scheme by which they would take a greater risk than in the present one. GERMAN COMPETITION.

From time to time the danger of German competition in several important industries is brought before the public, but the Bill that was to prevent the British manufacturer from losing his trade is still awaited, although the Government maintains that “the matter is being given anxious consideration.” To show the present position in the chemical industry it may be mentioned that the Association of British Chemical Manufacturers has stated that not only is unemployment rife and spreading, but that unless some immediate steps are taken the fine chemical industry built up at groat cost, on the strength of Governent promises, and in the hope of a sane and ordered future, will be lost to the country, and “Germany will become the chemical centre of the world.” The position in the magneto 1

an industry the building up of which was largely instrumental in the winning of the war, is if anything still more acute. A few weeks ago it was reported that quite 70 per cent, of the magneto makers of this country were either out of work or working short time, and today German magnetoes are being offered to our motor-car and aeroplane builders at a wholesale price of about £5, as compared with the British price of about £l5.

In one of the leading German journals it was stated recently that all the electrical works in Germany are full of work, and have heavy and pressing orders on hand, including large orders from Great Britain. In the meantime, as an authority states, the British manufacturer views with dismay his empty order-book, dismisses his workpeople, for whom he can no longer find employment, and wonders for how long he can •continue to stock the goods for which he has no sale. The German traveller is with us once again, and plentiful supplies of German manufactured goods are gh sale in every large town in England.

GOST OF RAILWAYS TO THE STATE.

For the year ending March 31 next the railways are expected to cost the taxpayer no less than £43,000,000. In other words, the sum necessary to make good to the companies the deficiency in present earnings as compared with the 1913 standard of net receipts is double the original estimate. Last session £22,000,000 was voted by Parliament for this purpose, and a supplementary estimate has now been presented for £21,000,000. It is explained that the additional vote is required to meet a deficiency of net receipts, due to the coal strike, amounting to £8,000,000, a further deficiency of £2,000,000 arising from the disturbed conditions in Ireland, and the decline in revenue, owing to trade depression, of which no estimate is given. The balance is to cover repairs in excess of standard and arrears of maintenance made good.