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U N IT E D S T A T E S D E P A R T M E N T O F L A B O R
Frances Perkins, Secretary
BUREAU OF LABOR STATISTICS
Isador Lukin, Commissioner (on leave)
A . F. Hinrichs, Acting Commissioner

Wages in Manufacturing Industries
in W artime
by
H . M . D o u ty , R obert J. M yers,
and Herm an D . Bloch

Bulletin 7{p. 756
[Reprinted from the M on th ly Labor R ev iew
October and. N ovem ber 1943]

UNITED STATES
GOVERNM ENT PRINTING OFFICE
W ASHINGTON s 1943

For sale by the Superintendent o f Documents, U . S. Government Printing Office
Washington* D . G. - Price 10 cents




Letter o f Transmittal

U nited States D epartment op L abor,
B ureau of L abor Statistics,

Washington, D. C., December S, 1948.
The Secretary of L abor:
I have the honor to transmit herewith a report on wages in manu­
facturing industries in wartime. The report is divided into parts.
The first part, on trends in factory wages, 1939-43, was prepared by
H. M. Douty, and the second part, on the level of factory wages
rates, by Robert J. Myers and Herman D. Bloch. The report was
prepared in the Bureau's Division of Wage Analysis, with the assist­
ance of the Division of Employment Statistics.
A. F. H inrichs,

Acting Commissioner.
Hon. F rances P erkins,
Secretary of Labor.




Preface
The two discussions of wartime wages of which the present bulletin
is composed first appeared as separate articles in the Monthly Labor
Review. Part I: Trends in Factory Wages, 1939-43 (published in
the November 1943 issue) and Part II: The Level of Factory Wages
in Wartime (in the October 1943 issue) are reproduced here without
change.
These articles form part of a series of broad, general discussions of
wages that have appeared in the Monthly Labor Review from time
to time, supplementing the Bureau’s monthly statistics on average
hourly and weekly earnings and its detailed studies of wage rates
by occupation.1 Although the present material deals exclusively
with wages in manufacturing, later articles will discuss wages in
nonmanufacturing industries.
The articles combined for publication in this bulletin are closely
related and are essentially comparable. Both deal with wages
during the period of World War II. Both, as is indicated above,
are limited to manufacturing industries. Part I, however, discusses
the changes that have taken place in the general level of wages
during the war period, and the factors responsible for those changes;
for simplicity of presentation, differences in the movement of wages
and in the level of wages among various groups of workers are ignored.
Part II, which contains a cross-section analysis of wage rates in a pre­
war period and in the summer of 1943, deals primarily with differences
in the rates of individual workers at the two periods and attempts
to point out some of the factors responsible for the differences shown.
Part I presents several measures of changing wage levels, while
part II analyzes wage differences in terms of average wage rates only.
The figures in part II are essentially comparable with the “ estimated
straight-time average hourly earnings” presented in table 4 (p. 11)
of part I.2
Parts I and II differ in one other important respect. Whereas in
part I manufacturing industries are segregated on the basis of durable
or nondurable product, part II distinguishes between the “ war”
and “ nonwar” industries. To a substantial degree these categories
correspond, since the durable-goods group consists largely of war
industries and the nondurable goods group principally of nonwar.
Readers who are interested in the distribution of factory workers by
average hourly wage rates for the durable and nondurable groups
may obtain these figures on application to the Bureau of Labor
Statistics.
1 See, for example, Effect of Incentive Payments on Hourly Earnings (May 1943), Wartime Wages and
Manpower in Farming (December 1942), Distribution of Factory Workers by Hourly and Weekly Earnings
(June 1942), and Wages and Cost of Living in Two World Wars (November 1941).
2 The data for July 1943 appearing in pt. I may be compared with the June 1943 figures in pt. II, since
wage changes from June to July were minor. In the data presented in pt. H, but not in the tabular data in
pt. I, allowance has been made for shift differentials. This affects the over-all average by only about 2
cents per hour.




m

Contents
Page

Preface________________________________________________________________
Part I.— Trends in factory wages, 1939-43:
Summary--------------------------------------------------------------------------------------Scope and purpose of study________________________________________
Major factors affecting wages, 1939-43:
Composition of the labor force_________________________________
Distribution of factory employment____________________________
Lengthening of the workweek__________________________________
Regulation of the labor market________________________________
Increased multishift operation________________________ :________
Fair Labor Standards A ct_____________________________________
Incentive payments, reclassifications, and automatic increases_
Wage-rate regulation by National War Labor Board___________
Changes in average money earnings and wage rates, 1939-43:
Average weekly earnings______________________________________
Average hourly earnings_______________________________________
Average hourly earnings, exclusive of premium pay for overtime
Estimated changes in average wage rates. ______________________
Changes in wage rates, October 1942-July 1943________________
Changes in average real earnings and estimated wage rates, 1939-43:
Changes in real earnings and rates_____________________________
Some other factors affecting real income_______________________
Part II.— The level of factory wage rates in wartime:
Summary___________ i _____________________________________________
Purpose and nature of analysis_____________________________________
Distribution of factory workers, by hourly rates____________________
Wage rates, by industry group_____________________________________
The highest-paid workers__________________________________________
Supervisory workers___________________________________________
Highly skilled craftsmen____________________
Incentive workers_____________________________________________
Workers in dangerous and unpleasant jobs_____________________
The lowest-paid workers------------------------------Typical jobs_______________________
Common characteristics_______________________________________
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Bulletin 7Lo. 756 o f the
U nited States Bureau o f Labor Statistics
[Reprintedfrom the M onthly L abor R eview , October and November 1943.]

P art I— Trends in Factory Wages, 1 9 3 9 -4 3
Sum m ary

M A N Y factors have contributed to the changes that have taken place
since 1939 in levels of money earnings and wage rates in manufacturing
industry. Wage rates have been influenced particularly by changes
in the size, sex, and age composition of the labor force, by sharp
alteration in the demand for labor, by minimum-wage action under
the Fair Labor Standards Act of 1938, and, especially since October
1942, by comprehensive social control over wage-rate changes.
Money earnings have been affected not only by changes in basic wage
rates but also by shifts in the distribution of workers among individual
manufacturing industries, by material increase in the length of the
average workweek, by the greater importance of overtime at premium
rates, by changes in the proportion of workers on late shifts with rate
differentials, and by wage changes, such as reclassifications, affecting
individual workers or small groups of workers.
The level of living that factory workers have been able to achieve on
the basis of increased average money income has been affected by the
upward movement of living costs and by other conditions growing out
of the war.
Sharp differences are evident in the movement of the various meas­
ures of money wages. Between January 1939 and July 1943, the
average weekly earnings of factory workers increased by 84.4 percent;
average hourly earnings by 52.4 percent; average hourly earnings,
corrected for premium overtime payments, by 45.1 percent; and
average hourly earnings, corrected for both overtime premium pay
and shifts in the distribution of workers among industries, by 32.1
percent. This last figure represents an approximation of changes in
average basic wage rates.
In terms of purchasing power, the average weekly earnings of
factory workers increased by 48.5 percent between January 1939 and
July 1943; average hourly earnings by 22.7 percent; estimated straighttime average hourly earnings by 16.8 percent; and estimated average
wage rates by 6.4 percent.
In addition to figures for all manufacturing, data are here shown
separately for workers in durable- and nondurable-goods industries.
Particular attention is devoted to the period beginning in October 1942
when a comprehensive program of wage-rate control was inaugurated.
Scope and Purpose o f Study

Any adequate analysis of wage trends in manufacturing industry in
recent years must take account of a series of important factors affecting
wages and must proceed with clear distinctions among earnings, wage




1

2

WAGES IN MANUFACTURING INDUSTRIES

rates, and real wages. This article presents the latest available in­
formation on the movement of factory wages from January 1939, in
the light of the factors affecting the trends in the various measures of
wages.
B y mid-1943 there were many indications that the conversion of
the American economy to the requirements of the war had been
substantially completed. For example, an estimated 47 percent of the
gross value of the national product was taken for military purposes in
the second quarter of 1943, as compared with 9 percent in the second
quarter of 1941 and an average of only 2 percent for 1939.1 The
output of durable goods, as measured by the Federal Reserve Board
index of physical production, was beginning to level off in the spring
of 1943, and, by June, Federal expenditures for war were being made
at an annual rate of almost 90 billion dollars. The tapering off of
the conversion process makes particularly appropriate a consideration
of trends in the wages of factory workers in the United States from a
period prior to the beginning of the war in Europe.
During the period from 1939 to mid-1943, and especially after the
autumn of 1940, a large upward movement of wages occurred. Wage
rates did not, of course, remain unchanged, but a very material
increase in money earnings would have taken place even if wage rates
had remained constant.
In the movement of wage rates themselves, the general tightening of
the labor market was a primary factor. Because of the growing
scarcity of labor, the trade-unions were able to exercise effective
pressure for increased wage rates. The attitude of the individual
employers of labor toward upward wage-rate adjustments became
more favorable as competition for the available labor supply became
more intense. Furthermore, wage rates in some industries were
affected by the application of the minimum-wage provisions of the
Fair Labor Standards Act of 1938.
Apart from the movement of wage rates, the general levels of both
hourly and weekly earnings were raised by a combination of other
forces, including shifts of workers among industries, lengthening of the
workweek, increased output under incentive systems of wage payment,
and increasing employment on late shifts at premium rates.
Changes in the average real earnings of factory workers can be
measured, in normal circumstances, by a comparison of changes in
money earnings with changes in the cost-of-living index. The matter
is much more complicated, however, in a modern war economy.
Apparent gains in real income may not be realized by the workers in
the form either of real consumption or of voluntary savings. More­
over, there are likely to be sharp contrasts among the workers in the
character of consumption and in the conditions under which consump­
tion takes place.
This article attempts to clarify the major factors governing the
trends of wages since 1939 and to present the available information
as to these trends in terms of these governing factors, as far as the
available information permits.
1 Survey of Current Business (U. S. Department of Commerce, Bureau of Foreign and Domestic
Commerce. Washington), August 1943, p. 13, table 5.




3

PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

,

M a jor Factors Affecting W ages 1 9 3 9 -4 3
COMPOSITION OF THE LABOR FORCE

Not until the summer of 1940, with the inauguration of the defense
program, did American industry begin to feel the impact of war.
For a considerable period thereafter, the factor of labor supply did
not operate as a serious limitation to expansion of output. Even by
the middle of 1941, a considerable volume of unemployment continued
to exist and hence significant reserves of manpower remained to be
utilized, even though shortages of skilled workers had become evident
at earlier dates in some of the key production centers.
Real pressure on the labor supply developed during the latter half
of 1941, and especially after the attack on Pearl Harbor. Moreover,
the drain of men into the armed forces was accelerated. Under these
conditions strong efforts began to be made in 1942 to attract new
workers into the civilian labor market.
A broad view of the developments in the American labor market
between July 1940 and July 1943 is presented in table 1. The totalnumberof workers available for civilian employment, the so-called civilian
labor force, declined by 1.4 millions during this period. Nonagricultural employment increased, nevertheless, by 5.4 millions and agricul­
tural employment rose by 1.3 millions. These increases in effectively
applied labor were brought about by sharp reduction in the number
of the unemployed.
T able 1.— Estim ated Civilian Labor Force, by Em ploym ent Status and Sex , in Selected
M onths, J u ly 1940-J u ly 1943 1
Estimated number (millions of persons)3
Sex and employment status
July 1940

July 1941

July 1942

Both sexes.....................
Unemployed *
*------Employed..............
Nonagriculture.
Agriculture___

56.9
9.3
47.6
36.8
10.8

56.6
5.7
50.9
40.2
10.7

56.8
2.8
54.0
42.3
11.7

55.5
1.2
54.3
42.2
12.1

Males............................
Unemployed3........
Employed..............
NonagricultureAgriculture___

43.1
6.3
36.8
27.0
9.8

42.6
3.7
38.9
29.5
9.4

41.6
1.7
39.9
30.2
9.7

37.8
.8
37.2
27.4
9.8

Females.........................
Unemployed *........
Employed..............
NonagricultureAgriculture___

13.8
3.0
10.8
9.8
1.0

14.0
2.0
12.0
10.7
1.3

15.2
1.1
14.1
12.1
2.0

17.7

July 1943

.6

17.1
14.8
2.8

i Data are from U. S. Department of Commerce, Bureau of the Census.
* All data* exclude persons in institutions.
* Includes persons on public emergency projects.

By the summer of 1943 a marked stringency had developed in the
labor market as a whole. Such unemployment as remained was mainly
of the temporary type, and the problem of the transfer of workers
from less- to more-essential employment had become urgent. A
material change had occurred in the sex composition of the civilian
labor force. Male workers available for employment declined by
5.3 millions between July 1940 and July 1943, whereas the number of




4

WAGES IN MANUFACTURING INDUSTRIES

female workers rose by 3.9 millions. Moreover, the existing labor
force was utilized more intensively by lengthening the hours of work.
These changes in the composition of the working force had powerful,
though divergent, effects on the level of wages. Demands upon the
available supply of civilian labor operated to raise wage rates. Length­
ening of the hours of labor tended further to raise the average of total
money earnings. By itself the increasing proportion of new workers,
especially women, tended to lower the average wage and the average
wage rate, as long as the proportion of new workers was large in the
total of employed workers. However, the mere continuance of these
new workers in employment tended to raise the wage averages, as
soon as recruitment slackened, and as the new workers acquired
experience and skill.
DISTRIBUTION OF FACTORY EMPLOYMENT

It is within the field of manufacturing industry that the most precise
accounting for wage trends can be made. Table 2 shows that em­
ployment in manufacturing industries as a whole increased by almost
70 percent from 1939 to July 1943. This was a greater rate of increase
than that experienced by any other major division of employment,
although relatively large gains were registered in transportation, in
certain branches of metal; mining, and in government service. On
the other hand, construction ana trade showed actual net declines
in employment during this period.
Within the broad field of manufacturing, striking changes in em­
ployment occurred. These changes have had an important effect on
wage levels. Employment in the manufacture of durable goods
more than doubled after 1939, while employment in the nondurable
industries showed a relatively moderate rise of 22 percent. In 1939
employment in the nondurable-goods industries had been considerably
greater than employment in the durable-goods industries. By July
1943 this situation had been reversed— almost 60 percent of all fac­
tory workers were employed by the durable-goods division.
Within the durable-goods division of manufacturing industries, all
the major industry groups showed a net increase in employment from
1939 to July 1943. However, the rates of increase were uneven. A
tremendous rise occurred in the transportation-equipment group, ex­
cluding the former automobile industry. Employment in this group,
including aircraft and shipbuilding, responded to the special needs of
war production. In each of the two machinery groups, employment
more than doubled. On the other hand, employment in the furniture
group rose by less than 10 percent.
Within the nondurable-goods division, the contrasts in employ­
ment trends were even more striking than in the durable division.
The chemicals group, notably affected by war demands, showed an
increase in employment of more than 1% times, whereas the leather
and tobacco groups actually showed slight net declines in employment.
During the shorter and more recent period, July 1942 to July 1943,
employment in the durable-goods division rose by more than 18 per­
cent, while that in the nondurable-goods division rose by less than 1
percent. Employment actually declined in this last 12-month period
in 3 of the 9 durable-goods groups and in 6 of the 11 nondurable-goods
groups.




5

PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

T able 2.— Estim ated N um ber o f W age Earners in M anufacturing , by M ajor Industry
D ivisions 1
Percent of
change—
Industry division

1939
average

July
1940

July
1941

July
1942

July
1943*

All manufacturing................ .............. ..........
Durable goods...........................................
Nondurable goods------------------------------

8,192
3,611
4,581

8,445
3,946
4,499

11,097
5,723
5,374

12,564
7,003
5,561

991
259
529

1,105
295
619

1,479
467
909

159
402
229
420
328
294

267
342
250
433
328
307

1,144
790
347
855
93
265
328
288
106
121
244

1,072
709
332
902
90
278
324
302
113
120
257

1939 to
July
1943

July
1942
to July
1943

13,895
8,286
5,609

+69.6
+129.5
+22.4

+10.6
+18.3
+ .9

1,612
542
1,094

1,711
709
1,246

+72.7
+173.7
+135.5

+6.1
+30.8
+13.9

598
570
349
565
403
383

1,559
513
381
559
374
369

2,310 +1,452.8
694
+72.6
414
+80.8
484
+15.2
360
+9.8
358
+21.8

+48.2
+35 3
+8.7
-13.4
-3 .7
-3 .0

1,312
889
386
1,000
95
320
841
411
124
161
335

1,293
866
374
1,052
94
302
325
613
129
153
360

1,219
833
330
1,016
89
316
339
742
126
192
407

-5 .7
-3 .8
-11.8
-3 .4
-5 .3
+4.6
+4.3
+21.0
-2 .3
+25.5
+13.1

Durable goods
Iron and steel and their products...................
Electrical machinery.......................................
Machinery, except electrical..........................
Transportation equipment, except automo­
biles..............................................................
Automobiles....................................................
Nonferrous metals and their products.........
Lumber and timber basic products...............
Furpiture and finished lumber products___
Stone, day, and glass products......................
Nondurable goods
Textile-mill products and other fiber manu­
factures.........................................................
Apparel and other finished textile products..
Leather and leather products___ : ..............
Food and kindred products______________
Tobacco manufactures......................... ........
Paper and allied products..............................
Printing, publishing, and allied industries..
Chemicals and allied products___________
Products of petroleum and coal____________
Rubber products.............................................
Miscellaneous industries................................

+6.6
+5.4
-4 .9
+18.8
-4 .3
+19.2
+3.4
+157.6
+18.9
+58.7
+66.8

* Estimates for the industry groups have been adjusted to final data for 1941 and preliminary data for the
second quarter of 1942, made available by the Bureau of Employment Security of the Federal Security
Agency.
2 Preliminary.

These interindustry shifts in employment resulted in a sharp rise
in average factory wages, quite apart from any wage-rate increases in
the various individual industries, since the shifts have been in the
direction of relatively high-wage industries.
LENGTHENING OF THE W ORKW EEK

While employment in manufacturing increased by 69.6 percent
between 1939 and July 1943, man-hours worked advanced by 99.8
percent. In short, the labor force in terms of number of workers was
extended during this period by a substantial addition to the length
of the workweek.
In the manufacturing industry as a whole, as table 3 indicates, aver­
age weekly hours increased from 37.7 in 1939 to 44.4 in July 1943, or by
17.8 percent.2 The increase in the durable-goods division amounted
to 21.1 percent, as compared with the materially smaller increase of
12.8 percent in nondurable-goods manufacture. Among durablegoods industries, average weekly hours in machine-tools manufacture
in July were 49.8; in 25 of the 50 individual durable-goods industries
for which detailed data are published, hours averaged 46 or more a
2 The decline in average weekly hours between June and July 1943—from 45.2 to 44.4—suggests that the
level of hours in the latter month was affected by observance of the Independence Day holiday.
564114-43°— 2




6

WAGES IN MANUFACTURING INDUSTRIES

week.8 Among the nondurable-goods industries, hours worked in
July 1943 were greatest in paper, chemicals, rubber, and in some
divisions of the food industry. In most of the textile, apparel,
tobacco, and printing and publishing industries, average weekly hours
did not greatly exceed 40 and in some cases fell below this level.4
The general tendency toward longer hours was stimulated by the
issuance on February 9, 1943, of Executive Order No. 9301, which
provided for the establishment of a 48-hour minimum workweek as
part of “ the fullest mobilization” of manpower in areas and industries
designated by the War Manpower Commission.6 At that time, the
basic war industries, with some exceptions, were operating on a mini­
mum 48-hour basis, but many establishments providing civilian
goods or services had shorter hour standards. On February 28, 1943,
the Commission issued regulations applying to the Executive order,
and initially designated 32 local labor-shortage areas as subject to its
provisions. The provisions were also applied nationally to the lumber
and nonferrous-metal-mining industries.
T able 3.— A verage W eekly H ours in M anufacturings 1939-43
Percent of change—
Industry division

AH manufacturing __
_
■purahla goods _ _
Nondurable goods

1939
average

37.7
38.0
37.4

July
1940

July
1941

37.3

40.3

38.1
36.6

41.6
39.0

July
1942

42.6
44.8
39.8

July
19431

1939 to July 1942
July
July 1943 to1943

44.4

+17.8

+ 4.2

46.0
42.2

+21.1
+12.8

+2.7
+6.0

iPreliminary.

Obviously the extension of hours of labor since 1939 has added
greatly to the weekly earnings of workers. This has been especially
true in industries subject to the Fair Labor Standards Act or in which
union provisions for premium pay for overtime after 40 hours are
widely applicable. Even at straight-time pay, the change from 40
hours to 48 hours would lead to a 20-percent increase in earnings for
a full-time week.
REGULATION OF THE LABOR MARKET

The creation of the War Manpower Commission on April 18, 1942,
grew out of the need for central direction in the utilization of the
available labor supply and in the maintenance of balance between the
manpower requirements of industry and the armed services. The
functions of the Commission basically relate to labor-market regulation.
Indirectly, however, the work of the Commission probably has had
some indeterminate influence on wage levels.
1.
The Commission, through the U. S. Employment Service, has
facilitated the transfer of workers to industries and employments*
« For data on average weekly hours by industry, see the report on Trend of Employment and Unemploy­
ment in the November issue of the Monthly Labor Review.
<Average weekly hours do not coincide with average full-time hours. If all the plants in an industry are
operating on a 48-hour basis, average hours per worker ordinarily will fall below this level because of labor
turnover, absenteeism, shut-downs for repairs, and other causes. On the other hand, average weekly hours
may exceed the standard full-time schedule if sufficient overtime is worked.
* See Monthly Labor Review, March 1943 (p. 471) and April 1943 (p. 666).




PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

7

considered most essential to the war effort. It is probable that these
transfers have been predominantly to jobs carrying higher wage rates.
2. The efforts of the Commission to control labor turnover in areas
of acute labor shortage, however, undoubtedly have reduced the
volume of transfers induced by the prospect of higher wages.
3. Through the encouragement of industrial-training programs,
the Commission has assisted in the training of workers m the skills
required in the basic war industries.
4. As previously pointed out, the Commission has been charged
with the administration of Executive Order No. 9301 relating to the
48-hom week. The Commission in general has been concerned with
the more intensive utilization of the labor supply.
INCREASED MULTISHIFT OPERATION

As production requirements increased, more intensive use of the
available plant and equipment began to be made in many establish­
ments by the introduction of multishift operation. In many of the
basic war industries, equipment is utilized virtually around the clock.
Frequently, however, employment on extra shifts is not so great as
employment on the first or daylight shift. Where three shifts are
operated, skeleton crews are often found on the third shift.
On the whole, work on evening or night shifts is less attractive than
work on the daylight shift. Consequently, the payment of premiums
to workers on extra shifts has developed, at least partly, as an induce­
ment to employees to accept work on late shifts. The industries in
which the payment of shift differentials is widespread are not numer­
ous, but these industries in the spring of 1943 employed very large
numbers of wage earners on late shifts. The principal industries
involved are aircraft, automobiles, electrical machinery, other types
of machinery (including machine tools), shipbuilding, and fabricated
steel products? Shift differentials in the spring of 1943 undoubtedly
exerted measurable influence upon the general levels of earnings of the
workers in these industries. As indicated later, the influence of shift
differentials upon the level of earnings in the manufacturing industry as
a whole was relatively small. In any comparison with pre-war data,
however, the shift-differential factor needs to be taken into account.
jrnimn pay on the level
tials are rare in certain
industries in which night-shift work is common. Many of the proc­
esses in these industries—basic steel, petroleum, pulp and paper,
and certain others— are continuous and require multishift operation.
It has been suggested that where shifts are rotated so that all workers
participate in night work, the shift differential factor may be taken
into account in the base rates paid rather than in differentials for
night work as such.
FAIR LABOR STANDARDS ACT

The influence of the Fair Labor Standards Act of 1938 on wages
during this period was by no means negligible. The minimum-wage
provisions of the act affected directly the wage rates and earnings of•
• See Pay Differentials for Night Work Under Union Agreements, Monthly Labor Review, July 1943
(p. 133). Studies of industry wage structures made by the Bureau’s Division of Wage Analysis also indicate
that the industry groups listed are those in which shift differential payment is widely found.




8

WAGES IN MANUFACTURING INDUSTRIES

substantial proportions of workers in a large group of relatively lowwage industries.7 Through the industry-committee procedure es­
tablished by the act, the statutory minimum of 30 cents an hour
(effective October 24, 1939) had been raised, by the spring of 1943,
to 40 cents8 in most of the covered industries containing appreciable
numbers of low-paid workers. After 1940, general economic factors
conspired to lessen opposition to minimum-wage-rate advances.
There was sharp employer opposition, for example, to the 32%-cent
minimum recommended by the Textile Industry Committee in the
spring of 1939; there was virtually no opposition to the 37K-cent rate
recommended for the textile industry 2 years later or to the subsequent
recommendation of 40 cents.
The hour provisions of the Fair Labor Standards Act have had a
marked effect on earnings since 1939. The act provides that covered
employees shall be paid (after October 24, 1940) not less than time
and one-half their regular rates of pay for hours worked in excess of
40 a week. The general lengthening of the workweek since 1940 has
made this provision of signal importance. Collective-bargaining
agreements, of course, usually contain provisions for premium pay
for overtime, and the hour standards found in such agreements tend
to be at least as favorable as those embodied in the Fair Labor Stand­
ards Act. It was in the extension of the principle of premium pay for
overtime to large groups of unorganized workers that the Fair Labor
Standards Act contributed importantly to increased earnings in the
present situation.
INCENTIVE PAYM ENTS, RECLASSIFICATIONS, AND AUTOMATIC INCREASES

During the period under consideration, wage levels undoubtedly
were influenced by the cumulative impact of wage changes affecting
individual workers or small groups of workers. The wages of indi­
vidual workers can be raised— aside from general wage-rate changes—
in at least three ways:
1. The earnings of workers paid on an incentive basis are obviously
affected by the level of labor productivity. Increases in labor pro­
ductivity can result from the operation of a number of factors, includ­
ing greater exertion by workers and better control by management
over conditions, such as the routing and flow of materials, that affect
the ability of workers to produce. The drive for increased output
as an aid to the war effort unquestionably has reacted favorably on
productivity in many plants and industries in which wage incentives
are used.9
2. Promotions, upgrading, and merit increases to individual workers
also represent a factor in changes in the level of earnings. It may per­
haps be noted that such increases are likely to be especially numerous
in periods of labor shortage.
3. Some plants have provision for automatic increases to employees,
based on length of service.•
f Approximately 25 percent of the 2.1 million workers employed in the 10 industries for which wage orders
had been issued by August 1, 1940, were directly affected by the wage-order minima.
* 40 cents is the highest minimum rate that can be established under the act.
•See Productivity and Unit Labor Cost in Selected Manufacturing Industries, 1919-40, and supplements
for 1941 and 1942. (U. S. Bureau of Labor Statistics, mimeographed reports.)




PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

9

W AGE-R ATE REGULATION B Y NATIONAL W AR LABOR BOARD

Comprehensive social control of changes in wage rates was inaugu­
rated in October 1942 as part of a general program for the stabilization
of prices. Some measure of control, however, had been exercised
since the spring of 1941 when the National Defense Mediation Board
was created. The successor to this body became the basic instrument
of wage regulation.1
0
The National War Labor Board, established on January 12, 1942,
was not initially created as an agency for general wage control. The
Board could deal directly with wages only in those dispute cases that
came before it.1 It had no control over voluntary wage adjustments.
1
Thus, its influence, as an instrument of wage regulation, was at first
largely indirect. The wage policy of the Board prior to October 3,
1942, was crystallized in the decision on the “ Little Steel” cases an­
nounced in July.1 Indirect general wage control through the medium
2
of decisions in labor-dispute cases, however, became increasingly less
effective as competition for labor sharpened.
On October 2,1942, Congress enacted an amendment to the Emer­
gency Price Control Act, authorizing the President to issue a general
order for the stabilization of prices, wages, and salaries at the levels
existing, as far as practicable, on September 15, 1942. In substance,
title 2 of Executive Order No. 9250, issued on October 3, provided
that no increases or decreases in wage rates could be made without the
approval of the National War Labor Board, and that approval for an
increase in wage rates above the September 1942 level should not be
granted “ unless such increase is necessary to* correct maladjustments
or inequalities, to eliminate substandards of living, to correct gross
inequities, or to aid in the effective prosecution of the war.” The
Board was thus granted broad power, with certain exceptions,1 over
3
wage-rate changes throughout the national economy.
It is not within the scope of this article to discuss or appraise the
principles developed by the War Labor Board in its administration of
the wage-stabilization program.1 * These principles have altered from
4
time to time, most drastically after the “ hold the line” injunction in
April 1943. The fact should be emphasized, however, that wage
control has not meant— and in a complex and dynamic economy could
not mean— the complete freezing of wage rates. The War Labor
Board has considerable administrative discretion in the matter of rate
adjustments.
1 The National War Labor Board succeeded the National Defense Mediation Board. That Board had
0
been created by Executive order on March 19,1941, to adjust disputes likely to obstruct or hinder national
defense which could not be settled by the Commissioners of Conciliation of the Department of Labor.
n The Board in Executive Order No. 9017 was given jurisdiction over labor disputes certified to it by the
Secretary of Labor, as well as the power to take jurisdiction of disputes on its own motion.
1 The decision in the “ Little Steel” cases revolved about the fact that living costs had increased approxi­
2
mately 15 percent between January 1941 and May 1942. The Board stated in its decision that the “ 15percent formula will be the limit for general wage-rate increases.” [Italics in original.] Provision was also
made for wage adjustments to correct “ inequalities” and “ substandard conditions.”
u The principal groups of employees whose wages are outside of War Labor Board control are found in
interstate transportation, where jurisdiction is exercised by the National Mediation Board; Federal, State,
county, and municipal government; and in agriculture, where the Department of Agriculture has certain
regulatory functions. At the time of writing, however, some question with respect to War Labor Board
control over farm-labor wages continued to exist.
MThe “ Little Steel” formula has continued to serve as a general guide to decisions on general wage-rate
changes. Prior to April 1943, wage adjustments on the basis of intraplant or interplant inequalities were
important. Since Executive Order No. 9328 in April, and on the basis of directives from the Director oi
Economic Stabilization, a program involving the establishment of wage-rate brackets by occupation and
labor-market area has been under way. The Board will permit wage-rate adjustments in normal circum­
stances up to the minima of the brackets. The question of substandards of living has also assumed greater
importance. Special situations acutely involving manpower or other factors—e. g., in the packing and
processing of perishable foods—may be handled outside of the confines of general policy.




10

w ages

in

m a n u f a c t u r in g

in d u s t r ie s

Moreover, the Board for administrative reasons has found it expe­
dient to exempt from control wage adjustments made by employers of
fewer than nine individuals. The Board estimates that approximately
1,500,000 establishments employing about 4,000,000 wage earners are
affected by this exemption.1 In General Order No. 30, the Board
5
established 40 cents as the rate up to which wage rates could be
adjusted without prior approval of the Board. In addition, certain
types of adjustments in the wage rates of individual workers may be
made without approval of the Board.1
6

,

Changes in Average M o n ey Earnings and W age Rates 1 9 3 9 -4 3
AVERAGE W EEK LY EARNINGS

The net effect of all of the factors discussed in the preceding section
on the average money earnings of workers in manufacturing is reflected
in the data on average weekly earnings in selected months shown in
table 4. Between January 1939 and Julv 1943, the weekly earnings of
the average factory worker increased from $23.19 to $42.76, or by
84.4 percent.
This increase in “ take-home” earnings 1 —to summarize the main
7
points of the preceding discussion—resulted in part from the fact that
the average wage earner worked substantially longer hours in 1943
than in 1939. Some of the additional hours were paid for at premium
rates. Workers on late shifts subject to shift premiums were few in
1939 but relatively numerous in 1943. Labor productivity, measured
in physical terms, increased considerably over this period. The
composition of the labor force had altered drastically; on the whole,
the industries in which wages were comparatively high in 1939 had
become relatively much more important by 1943. The proportion of
skilled workers in the labor force unquestionably had increased greatly
over this 4%-year period. Material advances in basic wage rates had
also taken place.
The level of weekly earnings in durable-goods manufacture in
January 1939 was distinctly higher than in the nondurable-goods
division. As table 4 indicates, this difference had widened by July
1943. At that time, average weekly earnings in the durable-goods
industries were 92.7 percent above the January 1939 level, as com­
pared with an average increase of 57.7 percent m earnings in nondu­
rable goods. There are basic differences between these two broad
divisions of the manufacturing industry in terms of the skill and sex
composition of their labor forces, location, industrial and corporate
structure, and other characteristics.1 Hence a persistent divergence
8
in levels of earnings can be anticipated. The more rapid rate of *
9
1
« Report of the National War Labor Board, January 12,1942-March 31,1943, p. 6. (Mimeographed.)
1 The adjustments are those based on (1) individual promotions or reclassifications; (2) individual merit
9
increases within established rate ranges; (3) operation of an established plan of wage increases based upon
length of service; (4) increased productivity under piece-work or incentive plans; (5) operation of an appren­
tice or trainee system.
» The term “ take-home" as applied to earnings is not so exactly descriptive now as formerly. It includes,
for example, amounts deducted at the source for social security, Federal income taxes, and war bonds.
1 For the industrial composition of these two divisions, see the report on Trend of Employment and
8
Unemployment in this issue of the Monthly Labor Review.




11

PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

increase in average weekly earnings in the durable-goods industries
between 1939 and 1943 can be explained largely by the difference in
the impact of the war on the two divisions.1
9
T able 4.— Average M on ey Earnings o f W orkers in M anufacturing , Selected M onths,
1939-43

Average weekly earn­ Average hourly earn­
ings
ings

Estimated straighttime average hour­
ly earnings i

Month and
year

Estimated straighttime average hour­
ly earnings weight­
ed by January 1939
employment2

Non­
All Dura­ Non­
All
All
Non­
All
Non­
manu­ Dura­ dura­ manu­ Dura­ dura­ manu­ ble dura­ manu­ Dura­ dura­
ble
ble
ble
factur­ goods
ble factur­ goods ble factur­ goods
ble factur­ goods. ble
ing
goods
ing
ing
goods
ing
goods
goods
January 1939.. $23.19 $25.33 $21.57 $0.632 $0.696 $0,583 $0,623 $0,688 $0.574 $0,623 $0,688
.644
.703
.655
.598
.717
.589
.635
January 1940. _ 24.56 27.39 22.01
.697
.722
.664
.683
.610
.749
.601
.648
January 1941— 26.64 30.48 22.75
.711
.708
.630
.735
.815
.645
.780
July 1941........ 29.62 33.90 25.16
.689
.771
.762
.688
.835
.801
.890
.670
January 1942.. 33.40 38.98 26.97
.729
.810
.856
.809
.856
.949
.725
.701
.759
.846
July 1942........ 36.43 42.51 28.94
.893
.723
.782
.751
.839
.919
.990
October 1942.. 38.89 45.31 30.66
.869
.941
.859
.733
.768
.794
January 1943.. 40.62 46.68 32.10
.919 1.017
.886
.881
.752
.957
.808
.944 1.040
.790
.897
April 1943....... 42.48 48.67 33.58
.904
.983
.963 1.061
.806
.823
July 1943*—
42.76 48.81 34.01
.769
.920

$0,574
.589
.600
.628
.667
.694
.716
.724
.741
.751

Indexes (January 1939=100)
January 1939January 1940January 1941—
July 1941........
January 1942..
July 1942........
October 1942..
January 1943..
April 1943.......
July 1943 8__—

100.0
105.9
114.9
127.7
144.0
157.1
167.7
175.2
183.2
184.4

100.0
108.1
120.3
133.8
153.9
167.8
178.9
184.3
192.1
192.7

100.0
102.0
105.5
116.6
125.0
134.2
142.1
148.8
155.7
157.7

100.0 100.0
103.6 103.0
108.1 107.6
116.3 117.1
126.7 127.9
135.4 136.4
141.3 . 142.2
145.4 146.1
149.4 149.4
152.4 152.4

100.0
102.6
104.6
110.6
118.0
124.4
128.8
131.7
135.5
138.3

100.0
103.4
i06.6
113.6
122.3
129.9
134.7
137.9
141.4
145.1

100.0
102.2
104.9
113.4
121.4
124.4
133.6
136.8
139.1
142.9

100.0
102.6
104.7
109.8
116.7
122.1
126.0
127.7
131.0
134.0

100.0
101.9
104.0
110.6
117.0
121.8
125.5
127.4
129.7
132.1

100.0
101.3
103.3
112.1
117.7
123.0
126.3
128.8
130.4
133.7

100.0
102.6
104.5
109.4
116.2
120.9
124.7
126.1
129.1
130.8

1 Average hourly earnings, excluding the effect of premium pay for overtime.
2 Average hourly earnings, excluding premium pay for overtime, weighted by man-hours of employment
in the major divisions of the manufacturing industry for January 1939.
8Preliminary.
A V E R AG E HOU RLY EARNINGS

Average hourly earnings, as shown in the second group of columns
in table 4, are obtained by dividing total pay rolls by man-hours
worked. The adjective “ gross” ’ is a useful and descriptive term for
this measure of hourly wages. All except one of the factors (hours of
work, figured at straight-time rates) that affect the movement of
average weekly earnings also influence the movement of gross average
hourly earnings. Hours worked influence the level of gross hourly
earnings only to the extent to which overtime premium pay enters
into the wage bill.
Between January 1939 and July 1943, the level of gross hourly
earnings in manufacturing increased from 63.2 cents to 96.3 cents.
This increase of 52.4 percent may be compared with the increase of 84.4
percent in average weekly earnings previously noted. The increase
in gross average hourly earnings in durable-goods manufacture during1
9
1 As previously pointed out, average weekly hours increased more rapidly in durable- than in nondurable9
goods industries between 1939 and 1943. Night work at premium rates developed predominantly in the
durable-goods division. The creation of vast shipbuilding, aircraft, and ordnance industries since 1939
added large blocks of skilled and relatively well-paid workers to the durable-goods division. As indicated
later, the movement of basic wage rates in the two divisions was not essentially dissimilar.




12

WAGES IN

MANUFACTURING INDUSTRIES

this period coincided with the increase of 52.4 percent for manufac­
tures as a whole; the increase in nondurable goods was 38.3 percent.2
0
AVERAGE HOURLY EARNINGS, EXCLUSIVE OF PREMIUM PAY FOR OVERTIME

The elimination of the influence of premium pay for overtime on gross
average hourly earnings yields a figure that may be termed “ straighttime average hourly earnings.” For any given distribution of workers
among employments, this figure represents an approximation of the
average wage rate. Gross average hourly earnings can be corrected
for overtime premium pay with reasonable accuracy on an estimated
basis.
Estimated straight-time average hourly earnings are shown in the
third group of columns in table 4 for various months from 1939 to 1943.
Comparison of the gross and estimated straight-time figures in table 4
indicates that premium pay for overtime was relatively unimportant in
January 1939; by July 1943, however, overtime premiums raised the
level of hourly earnings in manufacturing as a whole by slightly more
than 6 percent.
During this period, as the indexes in table 4 show, straight-time
average hourly earnings increased by 45.1 percent in all manufacturing,
and by 42.9 and 34 percent, respectively, in the durable- and nondurable-goods divisions.
It was suggested above that straight-time average hourly earnings
approximate the average wage rate “ for any given distribution of work­
ers among employments.,, This limitation is important. The use
of straight-time average hourly earnings to measure changes in levels
of wage rates over a period of time is appropriate only if there is no
change, or little change, in relative employment in the various indus­
tries and occupations. A simple example will make the point clear.
In the tabulation below, employment and hourly wage rates are shown
for two occupations at two periods of time. Wage rates do not change
in either occupation between the two periods, but employment in
occupation A is greater in the second period than in the first. Because
of this change in the distribution of workers among employments,
average hourly earnings were more than 4 cents greater in the second
period than in the first.
First period
Hourly
Employment
earnings

Occupation A ______________________
Occupation B _______________________
Both occupations____________

Second period
EmployHourly
ment
earnings

10
10

$1.00
.7 5

20
10

20

.875

30

$1.00
.7 5
.917

The very great changes that occurred in the structure of manufac­
turing employment between 1939 and 1943 prevent the use of straighttime average hourly earnings to measure, even in the, most approxi­
mate sense, the changes that took place in the level of wage rates.
2 The fact that the percentage increase in average hourly earnings between January 1939 and July 1943 was
0
the same for manufacturing as a whole and for the durable-goods division, but lower for the nondurable-goods
division, at first glance may appear surprising. The basic explanation of this apparent anomaly is the
relatively large increase in the weight of the durable-goods division over this period. An examination of
table 4 reveals instances in which the rate of increase in all manufacturing is greater than for either of its
components separately.




PART I— TRENDS I N FACTORY WAGES, 1 9 3 9 - 4 3

13

ESTIM ATED CHANGES IN A V E R AG E W AG E RATES

The fourth group of columns in table 4 shows, for various months
from 1939 to 1943, straight-time average hourly earnings corrected for
shifts in the distribution of workers among industries. Subject to the
qualifications discussed below, these d$ta broadly reveal the move­
ment of average wage rates over this period. The correction for
shifts in the distribution of workers was made by weighting straighttime average hourly earnings for each of the selected months by man­
hours of employment in the major divisions of manufacturing industry
for January 1939.2 This procedure eliminates changes in the level
1
of straight-time average hourly earnings resulting simply from the
increasing importance (over this particular period) of relatively highwage industries.
In manufacturing as a whole, average wage rates, as estimated in
this manner, increased by 32.1 percent between January 1939 and
July 1943, as compared with a 45.1-percent increase in the level of
straight-time average hourly earnings and 52.4 percent in the level of
gross average hourly earnings. The increases in estimated average
wage rates for the durable- and nondurable-goods divisions were 33.7
and 30.8 percent, respectively. This close correspondence in the
movement of estimated basic wage rates in the two broad categories
of manufacturing enterprise is arresting, and testifies to the pervasive
pressures on the basic wage structure during this period.
Examination of the data in table 4 indicates that employment shifts
contributed little to the movement in the level of straight-time aver­
age hourly earnings within the nondurable-goods division. Thus,
straight-time average hourly earnings in nondurable goods were 76.9
cents in July 1943 as compared wifh 75.1 cents after correction for
employment shifts. This result cou.d have been broadly anticipated,
since, as pointed out earlier, alterations in the distribution of employ­
ment were not strikingly great in this division. In durable-goods
industries, however, shifts in the distribution of employment between
January 1939 and July 1943 added more than 6 cents to the level of
straight-time average hourly earnings.
The fact must be emphasized that the changes in estimated average
wage rates shown in table 4 represent approximations. They do not
take into account (1) changes in the proportion of workers on late
shifts with rate differentials; (2) changes resulting from the possible
shift of workers during this period from low-wage to high-wage or
from high-wage to low-wage plants ajid occupations within industries;
(3) increasing or decreasing labor productivity under incentive
methods of wage payment; (4) upgrading and individual promotions;
or (5) the influx of many inexperienced workers into manufacturing.
CHANGES IN W AG E R A TE S , OCTOBER 1942-JULY 1943

Particular interest attaches to the movement of wage rates after
October 1942, when the wage-stabilization program became effective.
Between January 1939 and October 1942, the level of estimated wage
rates (straight-time average hourly earnings corrected for interindustry
shifts in employment) increased by 25.5 percent in manufacturing as
a Weighting by man-hours in individual industries rather than in major industry groups (such as iron
and steel and their products) would have had a negligible effect on the results.




14

WAGES IN MANUFACTURING INDUSTRIES

a whole (table 4). Most of this increase occurred after January 1941.
In fact, between January 1941 and October 1942, the level of estimated
wage rates increased by 20.7 percent—an average of approximately 1
percent a month. Between October 1942 and July 1943, the esti­
mated level of rates in all manufacturing advanced by 5.2 percent,
which represents an average increase of less than six-tenths of 1
percent a month.2
2
It will be recalled that the data on changes in average wage rates
represent approximations of the true average rates and reflect, among
other things, the influence of premium pay for late-shift work. A
special investigation was made of the effect of such premiums on gross
average hourly earnings in all manufacturing for September 1942 and
for the spring of 1943, For this purpose, data in the files of the
Bureau on the size and extent of shift-differential payments in the
more important industries in which shift premiums are found, to­
gether with data from the War* Production Board on the volume of
shift employment, were utilized. On the basis of these data, it was
estimated 2 that the payment of shift differentials increased the level
3
of gross average hourly earnings in all manufacturing by about 1.2
cents in September 1942 and by about 1.6 cents in the spring of 1943,2
4
an increase of four-tenths of 1 cent over this period. The effect on
certain individual industries, notably aircraft and shipbuilding, was,
of course, much greater.
When the increase of four-tenths of 1 cent attributable to shift
differentials is taken into account,2 the increase in estimated average
5
wage rates between October 1942 and July 1943 is reduced to 4.7 per­
cent. In the durable- and nondurable-goods divisions, estimated
average wage rates, uncorrected for shift differentials, increased by
5.9 and 4.9 percent, respectively, during this period. Shift premiums
are found principally in the durable-goods division; when correction
is made for the influence of this factor, the increase in estimated
average wage rates in durable goods is reduced to 5.4 percent.2
6
These figures of estimated wage-rate changes are extremely signifi­
cant, even when their approximate nature is taken fully into account.
It is clear that the upward movement of wage rates was slowed
measurably after October 1942 when the wage-stabilization program
was inaugurated. There is every reason to believe that, in the absence
of social control, wage rates would have advanced more rapidly in
the months after October 1942 than in the preceding period..
Actually, only a portion of the apparent increase of 4.7 percent in
estimated average wage rates in manufacturing was, in fact, the result
of increases in basic rates. As previously pointed out, these data are
influenced by wage adjustments of various kinds affecting individual
workers (promotions, upgrading); by changes in labor productivity,
which affect directly the straight-time earnings of incentive workers;
and by changes in occupational structures within plants and indus­
*» As compared with an increase of 5.2 percent in the level of estimated wage rates between October 1942
and July 1943, average weekly earnings increased by approximately 10 percent; gross average hourly
earnings by 7.9 percent; and estimated straight-time average hourly earnings, by 7.7 percent.
23 The estimates were made by Bernard Mandel of the Bureau’s Division of Wage Analysis.
24 These figures undoubtedly represent slight underestimations of the contribution of shift premiums
to gross average hourly earnings in all manufacturing, since industries in which shift premiums are un­
important were not considered in the preparation of the estimates.
2 It is reasonable to assume that there was no significant change in the level of shift-premium payments
3
between the spring and summer of 1943.
MIt is estimated that shift premiums contributed 2.1 cents to the level of gross average hourly earnings in
durable-goods manufacture in September 1942 and 2.5 cents in the spring of 1943.




PART I— TRENDS IN FACTORY WAGES, 1 9 3 9 - 4 3

15

tries. At present, the effect of these factors cannot be confidently es­
timated, and their individual movements are not necessarily in the
same direction.2
7
In substance, the increase in average basic wage rates both before
and after the advent of wage stabilization has been somewhat less
than the data set forth in this article indicate. Nevertheless, these
data, despite their limitations, are of extraordinary value in showing
the trend of wage rates.
Changes in Average Real Earnings and Estim ated W age Rates9
1 9 3 9 -4 3

The average living costs of factory workers, as measured by the
Bureau’s cost-of-living index for all large cities combined, increased
by 24.2 percent between January 1939 and July 1943. This sub­
stantial increase in the cost of the items that enter into the con­
sumption of wage earners should be taken into account in evaluating
the changes in average money earnings and estimated wage rates
discussed above. In addition, other circumstances growing out of the
war affect the real content of the money income of workers.
CHANGES IN REAL EARNINGS AND RATES
t

Table 5 shows indexes of real average earnings and wage rates for
selected months between January 1939 and July 1943. These
indexes were obtained by dividing the indexes of money earnings and
rates in table 4 by the cost-of-living index for the appropriate months.
Keference to table 5 indicates that real average weekly earnings
in all manufacturing increased by 48.5 percent between January 1939
and July 1943. It will be recalled that average weekly money earn­
ings advanced by 84.4 percent during the same period. The increases
in real average weekly earnings in the durable- and nondurable-goods
divisions were 55.2 percent and 27 percent, respectively.
For all manufacturing, as well as for the durable-goods division,
oss average hourly earnings, adjusted for changes in the cost of
r
ing, increased by 22.7 percent between January 1939 and July 1943;
the mcrease in the nondurable-goods division was 11.6 percent.
Estimated straight-time average hourly earnings, reduced to a “ real”
basis, advanced by 16.8 percent in all manufacturing, 15.1 percent in
durable goods, and 7.9 percent in nondurable goods.
The increase in estimated average wage rates over this period was
relatively modest when deflated for changes in the cost of living.
Thus, the increase in all manufacturing amounted to 6.4 percent, as
compared with 7.6 percent in durable goods and 5.3 percent in non­
durable goods. Between October 1942 and July 1943, estimated real
average wage rates, uncorrected for shift differentials, increased by
1.2 percent in all manufacturing. It is clear that changes in wage
rates did not contribute largely to the rather striking advances m
real weekly earnings.

g

force in a given ’industry that depress the fevel of hourly earnings despite the maintenance or even the
increase of basic wage rates.




16

WAGES IN MANUFACTURING INDUSTRIES

T able 5.— Indexes o f A verage R eal Earnings and W age Rates o f W orkers in M anu
factorings Selected M onths, 1939-43 1
[January 1939=100]

Average weekly
earnings

Average hourly
earnings

Estimated straighttime average hour­
ly earnings

Month and
year

Estimated straighttime average hour1y e a r n i n g s
weighted by Jan­
uary 1939 employ­
ment

All
All
All
All
Du­ Non­
Du­ Non­
Du­ Non­
Du­ Non­
manu­ rable dura­ manu­ rable dura­ manu­ rable dura­ manu­ rable dura­
ble
fac­ goods ble
fac­ goods
fac­ goods ble
fac­ goods
ble
turing
goods turing
goods turing
goods turing
goods
January 1939__
January 1940—
January 1941—
July 1941.........
January 1942—
July 1942..........
October 1942...
January 1943__
April 1943........
July 1943 *.......

100.0
106.1
113.6
120.9
128.2
133.8
140.6
144.7
147.1
148.6

100.0
108.3
119.0
126.7
137.0
142.9
149.8
162.2
154.3
165.2

100.0
102.2
104.4
110.4
111.3
114.3
119.0
122.9
125.1
127.0

100.0
103.8
106.9
110.1
112.8
115.3
118.3
120.0
120.0
122.7

100.0
103.2
106.4
110.9
113.9
116.2
119.1
120.6
120.0
122.7

100.0
102.8
103.5
104.7
105.1
106.0
107.9
108.8
108.8
111.4

100.0
103.6
105.4
107.6
108.9
110.6
112.8
113.9
113.6
116.8

100.0
102.4
103.8
107.4
108.1
106.0
111.9
113.0
111.7
115.1

100.0
102.8
103.6
104.0
103.9
104.0
105.5
105.5
105.2
107.9

100.0
102.1
102.9
104.7
104.2
103.7
105.1
105.1
104.2
106.4

100.0
101.5
102.2
106.2
104.8
104.8
105.8
106.4
104.7
107.6

100.0
102.8
103.4
103.6
103.5
103.0
104.4
104.1
103.7
105.3

i These indexes were constructed by dividing the index numbers of average earnings and estimated wage
rates shown in table 4 by the Bureau’s index of living costs (all large cities combined) for the selected months.
For this purpose the cost-of-living index as published by the Bureau was converted to a January 1939 base.
The index numbers for January 1939 and January 1940 were estimated, since for several years prior to Septem­
ber 1940 the cost-of-living index was computed only four times a year—March, June, September, and Decem­
ber.
>Preliminary.
SOME OTHER FACTORS AFFECTING REAL INCOME

It would be a mistake to conclude, on the basis of the data on real
weekly earnings, that the average employed factory worker was able
to advance his standard of life by almost 50 percent between 1939
and 1943. The nature of a full war economy precludes such an acchievement. The scope of this article does not permit consideration
of the supporting evidence, but three points can be stated briefly.
1. The proportion of the income of the average wage earner actu­
ally available for expenditure on consumption goods was affected more
heavily by taxes in 1943 than in 1939. Moreover, the rate of saving
among wage earners in 1943 was materially greater than in 1939, and
was undoubtedly above the level that would have been dictated by
purely private economic decisions in normal times.
2. Many types of goods available for consumption in 1939 were
either not available in 1943 or were available in reduced quantities.
3. The conditions of consumption were different for many wage
earners in 1943 as compared with 1939. For example, relatively more
wage earners- were separated from their families. Urban congestion,
on the whole, was much greater. In the service trades, standards of
performance had deteriorated.




Part II— The Level o f Factory Wage Rates in W artime
Sum m ary

OVER 8 million factory wage earners, or about 60 percent of the
total, received from 50 cents to $1 per hour in June 1943. About
370,000, or 3 percent, earned $1.50 or more. Ten percent were paid
less than 50 cents and about 2 percent less than 40 cents. Thirty
months earlier, in January 1941, only 12 percent of all factory workers
were paid $1 per hour or more, while 17 percent received less than 40
cents, and 31 percent received less than 50 cents. It should be noted
that these estimates apply only to wage earners in manufacturing
industries and do not include those in nonmanufacturing pursuits.
As would be expected, workers in the war industries (which are
types of industries that normally pay better than average rates) were
concentrated at higher wage levels in the summer of 1943 than were
the workers in nonwar industries. Forty-one percent of the war
workers, but only 15 percent of the nonwar group, were paid $1 per
hour or more. Only 4 percent of the former group but 17 percent*of
the latter received less than 50 cents. Workers paid $1 per hour or
more were relatively most numerous in the war transportation-equip­
ment industries, rubber, machinery, and printing and publishing.
Workers receiving less than 40 cents per hour were relatively most
numerous in lumber and timber, the food industries, tobacco, and
leather.
For the most part, the highest wage rates in manufacturing industry
are paid for supervisory ability, unusual skill, or high productivity un­
der an incentive-payment plan. The highest-paid workers are almost
exclusively men, and many of them are employed in establishments
with union agreements. Although most numerous in northern cities,
the highest-paid workers are represented in all parts of the United
States.
The lowest-paid workers— those receiving less than 40 cents per
hour—include many women. They are concentrated largely in the
South and few of them are union members. They are engaged
primarily in simple, routine jobs that can be mastered by an inexperi­
enced worker in a few days. The wage status of the lowest paid,
however, reflects not only the unskilled nature of the operations per­
formed, but other important factors, including the lack of legal or
trade-union protection, the isolation and immobility of the workers,
and, in some cases, low levels of productive efficiency.
P urpose and Nature o f A n a lysis

A review of the economic scene as of the summer of 1943 reveals
much evidence of high wages. The “ help wanted” columns of
metropolitan newspapers list scores of jobs paying more than $1 per
hour. The service trades and other low-paid industries are losing
many of their workers. Factory towns that have been stagnating
since the ’twenties are suddenly prosperous. Employers and union
officials appear together before the War Labor Board to request
authority for further wage increases*




17

18

WAGES IN MANUFACTURING INDUSTRIES

The story of high wages is well known. The earnings of workers in
the shipyards and munitions plants are discussed widely, often with
gross exaggeration. Not all American workers are in the high-wage
class, however. For one reason or another, millions of employees in
stores and factories receive scarcely half the pay scales of the growing
war industries. Their wages have risen since the outbreak of the war,
but are still moderate or low, even by pre-war standards.
The wide dispersion that characterizes American wage structure is
of considerable significance in the determination of public policy. In
the control of price levels, for example, it is essential to take account
of the incomes of the lowest- as well as the highest-paid workers.
Wage differences aggravate the manpower problem. They must be
considered in planning a tax program or launching a campaign of
Government borrowing. They are of enormous importance in the
field of post-war planning, because they may obstruct the necessary
transfer of millions from wartime to peacetime jobs.
The extent of the variation in the wage rates of American workers
is apparent from scores of surveys of wages in single localities and
industries.1 In the interest of valid perspective, however, it is desir­
able from time to time to turn away from such limited studies and
review in broad outline the structure of wages in the economy as a
whole. Unfortunately, this goal is not wholly attainable at the
present time. Little is known regarding the nature of parts of that
structure. As a first step, however, it is possible to describe with
reasonable accuracy the distribution of wages in the important
segment comprising manufacturing industry.
The composite figures presented in later sections of this article are
based on detailed studies by the Bureau of Labor Statistics covering
58 manufacturing industries. Although many of these studies are
now out of date, they have been corrected and extended, on an esti­
mated basis, by means of the Bureau’s monthly reports on average
hourly earnings.2 Voluminous current material regarding wage rates
in individual occupations has been used in checking and interpreting
the estimated distributions and in describing the jobs of the highestand lowest-paid workers.
Although believed to be dependable as a basis for general conclu­
sions, the estimated distributions presented here are subject to a
considerable margin of error and should be used with caution. They
are, of course, representative only of manufacturing industries.
Wages of nonmanufacturing workers are, with important exceptions,
lower than those of manufacturing workers, and have risen consider­
ably less since the outbreak of the war. In the summer of 1943 more
than two-fifths of all nonagricultural employees were engaged in
manufacturing.
It is important to note that the wages referred to in this article are
wage rates or their equivalent, rather than average hourly earnings or
other gross measures. As far as possible, premium payments for over­
time and for late-shift3 work have been excluded, together with non-*
* Many of the studies of the Bureau of Labor Statistics have been summarized in the pages of the Monthly
Labor Review. Others have been presented in unpublished form for the administrative use of the War
Labor Board.
* For a brW description of the methods involved in the preparation of the estimates see “ Distribution
of Factory Workers by Hourly and Weekly Earnings,” Monthly Labor Review, June 1942. Joseph M.
Sherman of the Bureau’s Division of Wage Analysis gave special assistance in preparing the estimates for
June 1943.
* Actually, adjustments to offset shift premiums have been practicable only in the war transportationequipment, machinery, and electrical-equipment industry groups. It is unlikely that the level of average
earnings in other groups is appreciably influenced by shift premiums.




19

PART II— LEVEL OF FACTORY WAGE RATES IN' WARTIM E

production bonus payments. Production bonuses and other incentive
earnings, however, are included. The figures used for workers paid
on an incentive basis consequently represent straight-time average
hourly earnings.
D istribution o f Factory W orkers b y H ou rly Rates

The range of factory wage rates in June 1943 is apparent from table
6, in which the nearly 14,000,000 workers employed at that time are
distributed by 10-cent wage classes. An estimated 370,000 workers,
representing the highest-paid manufacturing wage earners in the
Nation, earned $1.50 per hour or more. Even in this high-wage
period, however, approximately 220,000 workers, or about 1 out of 50,
earned less than 40 cents. The largest concentration of workers, only
1,820,000, received 80 to 90 cents per hour, while no fewer than 7 of
the 10-cent wage classes included a million or more workers each.
Wage rates of $1 or more per hour were received by about one-third
» of the workers.
T a b l e 6.— Estim ated D istribution o f W orkers in M anufacturing Industries by H ourly

W age R ates, January 1941 and J un e 1943
January 1941

June 1943
Hourly rate

Number of
workers

Percent

Number of
workers

Under 40 cent* ..
40 And under 60 cents _
5ft And under 00 cents.
60 and under 70 cents___________________________
____
70 And under A cents _
O
X And under 00 cents
ft
_ .. . _
00 end under 100 cents.
100 And under 110 cents
......
110 end under 120 cents
.. .
120 And under 130 cents ___
____ _
130 And under 140 cents . _
140 end tinder 1A cents.
O
1/50 cents end over
___

220,000
1.050.000
1.640.000
1.630.000
1.700.000
1.820.000
1,680,000
1,230,000
960.000
930.000
470.000
320.000
370.000

2
8
12
11
12
13
11
9
7
7
3
2
3

1,680,000
1,390,000
1,450,000
1,460,000
1,140,000
870.000
620.000
460.000
280.000
330,000

Total.................................................................

13,820,000

100

9,680,000

0)

<)
\

(0

Percent
17
14
15
15
12
9
6

5

3
(i)
(l)

4

0)

too

i Included in “ 120 and under 130 cents” class; the number of workers receiving 120 cents or more was too
small to permit further subdivision.

It is apparent from these figures that the much-discussed $100
weekly wage is extremely rare among American factory workers. A
first-shift4 worker putting in a 50-hour week at $1.50 per hour, and
with time and one-half for all hours in excess of 40, earns only $82.50.
Workers employed at $1 per hour during a 50-hour week earn only $55.
Toward the other end .of the scale are substantial numbers of workers
who put in 40 hours at 40 cents per hour and earn only $16.
Table 1 also presents striking evidence of the shift in wage rates
since January 1941, the base month for the “ Little Steel” formula.
In that month approximately one-sixth of all factory workers received
less than 40 cents per hour, many of them being paid exactly 30 cents,
the statutory minimum under the Fair Labor Standards Act. Onethird of the workers in January 1941, but only one-tenth in June 1943,
earned less than 50 cents. Only one-eighth of the workers in the*
* Long hours of overtime are uncommon for second- or third-shift workers.




20

WAGES IN MANUFACTURING INDUSTRIES

earlier period had rates of $1 or more per hour, as compared with about
one-third in the later period.
It is not the purpose of this article to discuss the wartime trend of
factory wages or the causes underlying that trend. It is appropriate,
however, to call attention to two factors that have greatly influenced
the distribution of wage rates since the outbreak of the war. One of
these is the extension of the 40-cent minimum wage by administrative
action, as authorized by the Fair Labor Standards Act. In early
1941 the 40-cent minimum applied to only a few industries, but by
June 1943 this minimum had been established in the bulk of the
low-wage industries. Because of the general upward movement of
wages, to be sure, the minimum wage probably determined the rates
of fewer workers in the latter period than in the former.
The other factor is the movement of millions of workers, new and
old, into the highly paid war industries. This trend, which has been
facilitated by drastic changes in the technology of the war industries,
has permitted the wage level to move upward independently of any
actual increases in wage rates. This shift has consequently been
greater than can be accounted for by wage increases alone.
W age Rates b y Industry Group

The wide variation in wage rates revealed in table 1 does not, of
course, reflect differences in pay for the same type of work in similar
localities. Wage rates in the same industry and locality show much
greater concentration, and workers in the same occupation in a given
city often receive identical rates. It is of interest, therefore, to
segregate various groups of factory workers for further examination.
The material at hand, unfortunately, does not lend itself to segre­
gation by geographic region. It is known, of course, from various
wage studies that many establishments in the South and in parts of
New England pay relatively low wages, while the highest wages are
generally found on the Pacific Coast and in the vicinity of the Great
Lakes. The detail presented in tables 2 and 3 permits a comparison
of the wage structures of broad industry groups.
T able 7.— Estim ated D istribution o f W orkers in W ar and N onw ar Industries by H ourly
W age R ates, June 1943
War industries *
Hourly rate

TTndar 40 cants
_
40 and under B cents
O
_
B and under fift cents
O
_
__
fin and under 70 cents ......
_ . _
70 and under R cents.
ft
...
80 and under 00 cents _
________
00 and under 100 cents
_. __ _
100 and under 110 cents
110 and under 120 cents
.
.
120 and under 130 cents
...
130 and under 140 cents _ __ _ _ _ _
140 and under 1B0 cents _ .
._
1B0 cents and over
_ _
_

Number of
workers
___
_ _
___
_____

_ _
_ .
_

Total _____ _____________ . __ _ ___
_

_

120,000

280,000
440.000
720.000
1.090.000
1.290.000
1. 200.000
950.000
790.000
810,000
390,000
250.000
270.000
8,600,000

Nonwar industries

Percent

1
3
5

8

13
15
14

11

9
10
5
3
3
100

Number of
workers

100,000

770.000

1, 200,000

810.000
610,000
530.000
380,000.
280.000
170.000

120.000

Percent

2
15
23
16

12
10
7
5

3

100,000

80,000
70,000

2
2
1
2

5,220,000

100

i Includes the following major industry groups: Iron and steel, electrical equipment, machinery other than
electrical, war transportation equipment, nonferrous metals, lumber and timber, chemicals and rubber*
All other industry groups, including “ miscellaneous industries,” are classified as nonwar..




PART II— LEVEL OF FACTORY WAGE RATES IK WARTIME

21

In table 7 the war industries are segregated from the nonwar
industries. This segregation is made on the basis of major industry
groups and is admittedly somewhat arbitrary. Some products of the
machinery industry, classified here as a “ war industry,” are used for
purely peaceful and domestic purposes, while clothing manufacture,
a “ nonwar industry” , includes the production of uniforms. In
general, however, the war industries are those that are largely engaged
in the direct production of fighting equipment or war transportation
equipment or of their basic materials.
It is apparent that wage earners in the war industries are con­
centrated at'considerably higher wage levels than those in nonwar
industries. This is not surprising, since the war industries are
primarily the heavy industries and customarily pay the higher wages
even in peacetime. Forty-one percent of the “ war workers” received
$1 or more per hour, while the largest proportion in any 10-cent wage
class, 15 percent, earned 80 to 90 cents per hour; only 1 worker out of
25 was paid less than 50 cents per hour. Among the nonwar workers
only 15 percent earned $1 or more per hour, while 17 percent earned
less than 50 cents; almost one-quarter were concentrated in the 50- to
60-cent class.
Estimates for individual industry groups are less dependable than
those for all manufactures or for the war and nonwar industries com­
bined. The summary figures presented in table 3, however, although
not permitting precise comparisons, are of considerable interest. It
is notable that many of these groups, unlike manufacturing as a whole,
show a marked concentration of workers at one level or another in the
wage structure. The contrast among the individual wage patterns
is pronounced.

Percent of workers earning—
Industry group

War industries:
War transportation equipment.........
Rubber..... ............ .... .......................
Machinery..........................................
Iron and steel.....................................
Electrical equipment....... ..................
N onferrous metals........................... .
Chemical, petroleum, and coal
products..........................................
Lumber and timber_______________
Nonwar industries:
Printing and publishing.....................
Leather...............................................
A pparel.............................................
Paper..................................................
Food....................................................
Furniture...........................................
Textiles...............................................
Tobacco..............................................
Stone, day, and glass.........................

Approx­
imate
80
40 and
number of
Under under 60 and cents $1.00
under and
and
workers1 Total
40
60
80
cents cents cents under under
$1.00 $1.20

2,070,000
190,000
1,250,000
1,720,000
700,000
420,000

100
100
100
100
100
100

870,000
480,000

100
100

330,000
330,000
850,000
320,000
950,000
360,000
1,230,000
90,000
360,000

100
100
100
100
100
100
100
100
100

$1.20
and
over

1
17
9
5
21
7

13
21
22
29
28
28

29
22
29
35
22
36

27
14
24
15
12
16

30
26
16
16
16
13

2
18

12
40

26
10

29
15

18
9

13
8

2
3
2
1
4
1
1
4
1

20
33
51
34
27
45
54
55
27

15
32
21
35
33
28
30
17
22

18
16
12
20
24
16
8
13
29

13
9
7
6
8
6
4
8
19

32
7
7
4
4
4
3
3
2

(2
)
(2
)
(2
)
(2
)

1

(2
)

1Excludes approximately 400,000 workers in miscellaneous minor industries for which information is not
available by industry group.
* Less than five-tenths of 1 percent.




22

WAGES IN

MANUFACTURING INDUSTRIES

Table 8 brings out the great importance of the “ war transportation
equipment” group, which includes shipbuilding, airframes and engines,
the converted automobile industry, locomotives, and railway cars.
Thirty percent of the workers in this group earned $1.20 or more per
hour. In war transportation equipment alone, more than half (57
percent) of the workers received $1 or more. Among war industry
groups, only lumber and timber employed a substantial proportion of
its working force at less than 40 cents per hour. M ost of these
workers were in the South, whereas much higher wages prevailed on
the Pacific Coast.
Printing and publishing, a relatively small group, paid by far the
highest wages in the nonwar category. Nearly one-third of the work­
ers in this group earned $1.20 or more, as compared with only 7 per­
cent in the next highest nonwar group. All of the nonwar industry
roups showed substantial concentrations below 60 cents per hour,
ut none showed as many as 1 worker out of 20 receiving less than 40
cents. The highest proportions in this low-wage class were in the
tobacco (4 percent) and food (4 percent) industries.

S

The H ighest-P aid Workers

The wide differences in wage rates which prevail even within the
same industry groups could be explained in large part if it were pos­
sible to analyze the material at hand in terms of location and size of
factory, skill, sex, and race of worker, and certain other factors.
Unfortunately this material does not permit further analysis. It is
enlightening, however, to examine the occupational characteristics of
the highest- and lowest-paid workers. The contrast between these
groups can be expected to be relatively sharp, and their small size
facilitates analysis. As a basis for this examination, current occupa­
tional wage rates are available from representative manufacturing
establishments in all parts of the United States.
For present purposes, the highest-paid factory workers are con­
sidered to be represented by the nearly 700,000 wage earners esti­
mated to have earned $1.40 or more per hour in June 1943. Most of
these workers, as has been seen, are in the war industries. A review
of current occupational rates from many thousands of manufacturing
plants indicates that they fall largely into four major classes: (1)
Working supervisors, (2) craftsmen of high and unusual skills, (3)
workers paid on an incentive basis, and (4) workers in dangerous or
unpleasant occupations. These classes, it will be noted, involve some
overlapping. For example, some jobs require skill and involve danger,
in addition to being paid on an incentive basis. The number of
highest-paid workers who are not included in one or more of these
groups, however, is negligible.
SUPERVISORY WORKERS

Supervisory workers, as discussed here, include working foremen,
set-up men, leaders, lay-out men, and similar groups (but not full-time
supervising foremen, who are customarily salaried employees and not
considered as wage earners). These workers assign work, specify tools
or methods, instruct beginners, prepare machines for new tasks, and
perform similar functions. Many of them spend most of their time
setting up machines for less experienced workers and perform a mini­



PART II— LEVEL OF FACTORY WAGE RATES I N W ARTIM E

23

mum of supervisory work. Generally, however, they are experienced
workers who, in addition to mastering their own jobs, have demon­
strated qualities of leadership and the ability to instruct others.
Supervisors very generally receive higher wages than the workers
they train and direct, but thousands of supervisors in low-wage in­
dustries are poorly paid. A majority of the supervisors in manu­
facturing industry receive considerably less than $1.40 per hour.
Highly paid supervisors are numerous in certain war industries,
however, where the accession of thousands of new workers has enor­
mously enlarged the task of training and directing. Working super­
visors consequently account for an appreciable proportion of the
highest-paid factory workers.
Supervisory workers in shipbuilding comprise approximately 7
percent of all wage earners, although not all of these supervisors
receive as much as $1.40 per hour. Working foremen in shipyards
are sometimes paid in excess of $2. In a recent pay-roll period,
however, the average wage for such workers in Atlantic Coast con­
struction yards was only $1.64 and the averages for the other zones
were somewhat lower.
Highly paid supervisors are rather numerous in the manufacture of
airframes and engines, in rubber tires and tubes, and in most of the
metal-working industries. On the whole, however, this group of
highly paid workers probably shows less concentration by industry
than those discussed below. At least a few of these workers are to be
found among the largest establishments of the majority of industries.
HIGHLY SKILLED CRAFTSMEN

A substantial majority of the highest-paid workers consists of
skilled craftsmen or “ specialists,” whose occupational preeminence has
required many years of training and experience. Practically all of
these workers are men, and a large proportion are union members.
There are hundreds of skilled jobs in each of which a few highly paid
workers may be found. Those in which rates of $1.40 or more are
typical or common are more limited in number, but still too numerous
to permit discussion in full. The nature of these jobs may be indi­
cated, however, by the presentation of several examples.
The loftsman in the shipbuilding industry provides an excellent
example of a highly skilled craftsman in a war job. This workman
lays out to full scale on the floor of his “ loft” the lines of a ship
planned for construction. He develops patterns or molds— often of
paper or of wood— to guide the efforts of other workers. He not
only must possess judgment, imagination, and a knowledge of geo­
metric construction, but must also be expert in the use of many tools
and machines. Like others of the skilled workers mentioned below,
loftsmen rank high on the War Manpower Commission’s list of criti­
cal jobs. First-class loftsmen in ship-construction yards on the
Atlantic Coast, however, have recently averaged about $1.40 per
hour, and in some zones their average has been less.5
The rollers of the iron and steel industry (rolling mills) have long
been among the highest paid of all American wage earners. While*
* Somewhat below the level of the highest-paid workers under discussion, but deserving of mention
because of their number, are the “ first-class skilled mechanics” of the shipyards. These workers, who
number about a quarter of a million, include carpenters, electricians, machinists, riveters, welders, and a
score or more of other craftsmen of comparable skill. Under the terms of the shipbuilding stabilization
agreements they receive a base rate of $1.20 per hour, but a few crafts, such as the anglesmiths, commonly
receive higher rates of pay.




24

WAGES IN MANUFACTURING INDUSTRIES

the number of rollers in the basic iron and steel industry is not large,
their earnings frequently average $3 per hom* or more. There are
several varieties of rollers, but their work typically involves the oper­
ation of stands of rolls, which level and reduce heavy steel stock into
rods, bars, sheets, and other products. The roller’s expert-knowledge
must enable him to control the amount and speed of reduction, to
estimate the gage of the material, and to recognize defects by inspec­
tion. Rollers direct their assistants and other workers, but are not
ints, themselves, deserve to be
Other iron and steel workers
,
d pourers, vesselmen, heaters,
straighteners, and roughers.
Somewhat lower than rollers in the wage scale, but more important
numerically, are the tool and die makers, prominent in the manufac­
ture of aircraft and in many other of the metal-working industries.
These workers do not ordinarily engage in production but specialize
in the construction and repair of tools, jigs, and fixtures and the prepa­
ration of dies for forging, forming, and stamping. Their work re­
quires the utmost precision, tolerances of To:W 0 of an inch or less being
specified frequently. They must be expert in the use of many types
of machinery. The average wage rate in job shops in Detroit,
probably the greatest center of tool and die work in the world, is
about $1.77 per hour. Tool and die makers in most other localities
are paid lower rates than this, but the majority undoubtedly earn
more than $1.40 per hour.
Patternmakers also rank high among the skilled workers in the
metal trades. Working either with wood or with metal, and respon­
sible for adhering rigidly to the specifications of a blueprint, these
craftsmen prepare the master patterns or forms from which molds
are made for the manufacture of parts. Obviously, their work has
much in common with that of the loftsmen, mentioned above. Pat­
ternmakers usually serve a long and strict apprenticeship. Their
work requires a practical knowledge of mathematics and other scien­
tific fields; for example, a patternmaker must be able to make
appropriate allowance for the contraction of cooling metal. So costly
and so vital to his work are the patternmaker’s tools that the Pattern
Makers’ League of North America has established a mutual insurance
system to provide protection against their destruction or loss. Pat­
ternmakers’ wage rates average a little less than those of tool and
die makers; substantial numbers, however, receive more than $1.40.
Among other high-wage occupations in the metal trades are those
of lead burners, in nonferrous smelting and other industries, and vari­
ous precision inspectors— for example, tool inspectors and service and
flight inspectors (aircraft).
The rubber industry includes a number of skilled and highly paid
jobs, of which the most important numerically is that of tire builder.
This worker builds up tire casings by hand on a mechanically rotated
drumlike form. A considerable amount of skill and great physical
endurance are required to assure the strength and durability of the
tire and to guard against defects. Although the tire builder’s job
can be mastered more quickly than most of the other jobs discussed
in this section, his earnings are generally raised by incentive payments.
Tire builders in Akron average approximately $1.50 per hour.
Mention should also be made of the stillmen in the petroleum­
refining industry. These workers operate the units in which crude or



PART II— LEVEL OF FACTORY WAGE RATES IN' WARTIM E

25

other oils are broken down by distillation to obtain gasoline and
other products. Rates of $1.40 or more per hour are not uncommon,
even in the Southwest, where general wage levels are lower than in
the Nation as a whole.
Among the highest-skilled and highest-paid workers in nonwar
industries are the cutters in the men’s clothing industry, who cut one
or more layers of cloth to be tailored into finished garments. Most
cutters also lay out the cloth and mark it for cutting; great pains
must be taken with patterned cloth, particularly plaids, to assure
that the various pieces will match when they are assembled. The
cutters are known as the aristocrats of the industry, and in the early
years arrived at their workrooms in frock coats. The standard rate
for cutters in New York City is $1.81 per hour; somewhat lower
rates prevail in most of the other centers.
Several skilled crafts in the printing trades commonly carry earnings
of $1.40 an hour or more; these include the pressmen, compositors,
electrotypers, engravers, and finishers.
Cloth-printing-machine
operators in the dyeing and finishing industry are outstanding because
of their high rates among the relatively low rates paid in the industry
in general. Brushers, plushers, and machine stakers are highly paid
jobs in tanneries.
IN C E N TIV E W O R K E RS

Appreciable numbers of workers attain the highest-wage brackets
not because of supervisory ability or extraordinary skill, but as a
result of high productivity under an incentive-payment system.
Incentive workers quite generally earn more than time workers,6 but,
because of differences in the systems of payment, the efficiency and
energy of the workers, the efficiency of management, and other factors,
the extent of the difference varies widely.
Incentive-wage payment is in itself no guaranty of high wages.
Indeed, the sweatshops of earlier years usually employed a piecepayment system, and even today many thousands of low-paid workers
in textiles, clothing, and other industries are paid piece rates or other
incentive wages.
Many skilled and a few semiskilled workers, however, who might
earn 90 cents to $1.20 per hour at straight-time rates, average $1.50
or more as a result of incentive payment. Thus, first-class molders and
first-class riveters, who in other shipyards receive the standard $1.20
rate, have recently averaged $1.56 and $ 1.77, respectively, in the Atlantic
Coast yards, where incentive payment is common. Large numbers of
high-wage incentive workers are found in steel works and rolling
mills. Incentive payment accounts in part for the relatively high
wages in the rubber industry, electrical equipment, machinery manu­
facture, and the primary fabrication of nonferrous metals.
W O R K E R S IN DAN GEROU S A N D U N P LE A SA N T JOBS

As a result of union agreements or in order to attract workers,
dangerous jobs and those involving unusual fatigue or unpleasantness
sometimes carry a wage premium. Such premiums may also be paid
for outside work and irregular work. A few of the highest-paid
workers in manufacturing industry owe their wage advantage in
part to such factors.•
•See "Effect of Incentive Payments on Hourly Earnings" in the Monthly Labor Review for M ay 19&




26

WAGES IN MANUFACTURING INDUSTRIES

It is doubtful whether a numerically important job can be found in
manufacturing in which wages of $1.40 or more per hour are paid for
semiskilled or unskilled work solely because of accompanying danger
or unpleasantness. A number of relatively skilled jobs, however, fall
in the highest-wage class partly as a result of such factors. One of these
is the occupation of rougher in the steel industry. The rougher guides
heated steel bars, rods, or sheets into the roughing mill. In addition to
being somewhat dangerous, this work involves strenuous exertion under
conditions of intense heat. Roughers frequently average more than
$1.50 per hour. The wet wheelers of the leather industry are highly
paid workers whose jobs are extremely unpleasant. They grind
and smooth on a wheel the flesh side of green hides. In certain nonferrous-metal foundries noxious gases, noise, and dirt undoubtedly
account in part for the relatively high wages.
Most workers in dangerous or unpleasant jobs, however, appear to
receive moderate or low rates of pay. In chemical and explosives plants
the workers handling acids and explosives typically receive lower rates
than the skilled maintenance men, whose jobs are much safer. Truck
drivers often receive a premium of only 5 to 10 cents per hour when
hauling high explosives.
The Low est-P aid W orkers

For present purposes, the lowest-paid workers are defined as those
receiving less than 40 cents per hour. It has been seen that such
workers numbered about a quarter of a million in June 1943, or included
approximately 1 manufacturing wage earner out of 50. They are
found in substantial proportions in manufacturing only in certain
branches of the lumber, food, chemical, textile, clothing, and tobacco
industry groups. Many of the lowest-paid workers are women, and
relatively few are employed in plants with union agreements. Large
proportions are employed in the South.
TYPICAL JOBS

There is little romance in the lowest-paid jobs. With few exceptions,
they are simple, repetitive, and monotonous. Typically they involve no
supervision of other workers, and can be mastered immediately or
after a few days1 experience. Many of the jobs are paid on a piece
basis—with or without a minimum guaranty. The working conditions
of some of the jobs are dangerous, or extremely unpleasant.
It is significant to note that the lowest-paid jobs usually involve
specialized operations, and by no means consist entirely of “ common
labor.” Relatively few common laborers, in fact, receive wages lower
than 40 cents per hour, and these are often found in establishments that
pay even lower wages to certain other employees. On the other hand,
the standard entrance rate for common labor in most of the steel
industry is 78 cents per hour, and entrance rates of $1 or more are not
unknown.
Many of the lowest-paid workers are found in the logging camps
and sawmills of the South, which cut and process light, second-growth
timber. These workers are exclusively men, and include large num­
bers of Negroes. One of the numerous low-paid jobs is that of the
swamper, who with various hand tools clears the ground of underbrush
and other obstructions in preparation for the construction of a logging



PART II— LEVEL OF FACTORY WAGE RATES IN W ARTIME

27

road. Fallers and buckers cut down trees with an axe or a hand
crosscut saw (men usually working in pairs) and cut felled trees into
logs of the desired length. The lumber piler stacks lumber by hand
in a yard or shed for storing or drying. Both in logging camps and in
sawmills there is frequent shifting from one job to another.
- A number of the food industries are also represented among the
lowest-paid workers— particularly the canning, drying and preserving
of fruits and vegetables and of sea foods. In these industries, wages
as low as 25 cents an hour are sometimes encountered. Thousands
of low-paid women work in these industries as washers, sorters, peelers,
boners, slicers, packers, and so forth. These women usually take
their work from a table or moving belt before them and, after perform­
ing their simple operation, place the product on another table or belt
or in special receptacles. They are often paid by the piece or by the
pound. Their working conditions are sometimes unpleasant, owing
to the sloppiness of floors and tables and to the pressure of their
seasonal work. Numerous low-paid workers are also found in the
poultry industry and the manufacture of nonalcoholic beverages,
artificial ice* and cottonseed products.7
Of the various industries included in the chemical group, only the
fertilizer industry employs numerous workers at less than 40 cents
per hour. Many of these are laborers, who shovel and haul in wheel­
barrows the chemicals, bone, manure, and other ingredients to be mixed.
Even lower paid than the laborers, on the average, are the den diggers,
who work in a damp and fume-laden atmosphere and whose job it is
to shovel superphosphate out of the den room to be conveyed to trucks.
The fertilizer industry employs large numbers of Negro workers.
The lowest-paid workers also include numerous girls and women in
the apparel industries—many of them classified as “ learners.” Most
of these workers are stitchers, performing simple sewing-machine
operations, and paid by the piece.
Among the remaining lowest-paid workers are the brick tossers and
other unskilled workers in brickyards and the strippers (leaf stemmers)
employed in the processing of cigar tobaccos. A thin sprinkling of
errand boys and girls, sweepers, janitors and similar workers are em­
ployed in many industries at less than 40 cents.
COMMON CHARACTERISTICS

It will be apparent from the preceding discussion that the lowestpaid jobs involve, for the most part, simple, repetitive work, capable
of bemg performed by inexperienced workers with little or no train­
ing. There is little in the nature of these jobs, however, to explain
their low level of pay. Hundreds of jobs of no greater skill pay wages
considerably higher. It is necessary, therefore, to look beyond the
nature of their jobs and to examine certain characteristics of the
industries, of the workers, and of the areas in which the workers live.
In the first place, it should be noted that nearly all of these workers
are in industries with limited or no legal protection of the wage rate.
The minimum-wage laws of many of the States give only partial pro­
tection and may be inoperative. Some of the low-wage industries,
7The 40-cent minimum became effective in the cottonseed and peanut-crushing industry on August 16,
1943. Other industries in which the 40-cent minimum was applied between June 30 and September 30,
1943, include vegetable fats and oils; metal, plastics, machinery, instruments and allied industries; embroid­
eries; mattresses, bedding, and related products; and miscellaneous textile, leather, fur, straw, and related
products.




28

WAGES IN MANUFACTURING INDUSTRIES

such as the preparation of seafoods, do not appear to be subject to
the minimum-wage provisions of the Federal Fair Labor Standards Act.
Others— for example, the ice industry—include large numbers of
local establishments which are exempt because they do not engage in
interstate commerce. In a few of the industries that are generally
covered by the Federal act the minimum has not yet been raised to
40 cents; prominent examples are the lumber industry, fertilizer,
brick and tile, poultry, and canning and preserving.8 “ Learners”
and handicapped workers in a number of industries are permitted to
earn less than the established minimum. Learners are most numer­
ous in the apparel industries in which during the first 6 months of
1943 certificates were issued covering over 12,000 learners and a small
number of handicapped workers.
It is also significant that many of these industries draw upon isolated
and immobile labor supplies that are insensitive to the bids of higherwage trades. Some o f the industries are seasonal and depend on
housewives and other part-time or irregular workers who cannot
accept year-round jobs. Many are in small towns where there are
few competitors for the local labor supply and where the higher rates
outside may not be known. The lumber camps and sawmills draw
heavily on the farming population. Thus, many of the lowest-paid
workers in manufacturing industries are unfamiliar with the favorable
employment opportunities elsewhere, or are unable to take advantage
of them.
Finally, in addition to those whose low wages result from limited
opportunities, the lowest-paid group includes a substantial proportion
of the least efficient and the least productive workers. Among these
are the learners and handicapped workers, who in most industries
must be officially certified if they are to receive less than the minimum
wage. Some of the lowest-paid workers enter the labor market only
sporadically and with no intention of learning a trade or becoming
proficient at their jobs. Some are continually in the labor market
but are marginal workers—persons of limited capacity who cannot
get a job at all except in periods of great industrial activity.
The availability of labor at low wages, it should be noted, has
permitted many firms to operate with obsolete equipment in competi­
tion with firms using modern equipment with higher-paid labor. For
example, the hand stemming of tobacco survived for a considerable
period in many plants because low wages offset the advantage of ma­
chine stemming. Similarly, because the level of wages was low, a
number of seamless-hosiery mills operated nonautomatic equipment
that required large amounts of labor.9
Low wages, therefore, do not necessarily imply low labor cost. The
advantage to the employer may be more than offset by low labor
productivity. This fact, together with the inefficiency of manage­
ment found in many of the lowest-wage establishments, explains why
competing establishments are able to stay in business while paying
much higher wages.*
* The industry committees for all of the remaining manufacturing industries with a minimum wage lower
than 40 cents have recommended establishment of the 40-cent minimum.
* Both of these situations have been changed in some degree by the Fair Labor Standards Act. Today
a 40-cent minimum prevails in the hosiery industry.





Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102