This section is from the "The Science Of Wealth" book, by Amasa Walker.
In addition to this, the large manufacturer can afford to work for a smaller rate of profit.
A single hatter, for example, who makes only $2,000 worth of hats, must secure 25 per cent, in order to have a net income of $500 ; while the man who can make $20,000 worth of hats will, if he realize only 12|½ per cent, have an income of $2,500. A cotton manufacturer, who makes 3,000 yards per day, or 900,000 per annum, if he gets but half a cent per yard profit, has an income of $4,500; the man who makes but 300 yards per day, at one cent per yard, or double the profit, gets but $900.
We see from these illustrations why the great establishments drive smaller ones out of the market. A tendency to a reduction of profits is a natural consequence of this. Therefore, other things being equal, it is desirable that manufacturing establishments should be sufficiently large to secure all the advantages of concentrated capital, and effect the complete division of labor.
7th, It shortens apprenticeship.
Every art, trade, or profession must be preceded by an apprenticeship, more or less extended, according to what is necessary to be learned. A trade, which, in order to be perfectly understood in all its parts, requires an apprenticeship of seven years, — if it be subdivided into seven different operations, may, it is evident, be obtained with as great a degree of perfection by an average, in each branch, of one year's service. Some of the parts may require more than one year, others less.
Now, we find this to, be practically true ; and the result is a great saving of time, and time is money.
For example: —
Seven men serve seven years each to learn to make hats,
— in all, a service of...........49 years
Seven men serve one year each to learn to make a
seventh of a hat, equal to..........7 „
Saving of.............42 years
in the mechanical education of every seven men employed in this manner.
Apply this principle to the manufacturers of Massachusetts, which has at least 75,000 skilled workmen, and suppose the apprenticeship to be seven years, we have —
75,000 at 7 years each..........525,000 years
75,000 at 1 year each..........75,000 „
Saving of...........450,000 years
in one generation of skilled workmen.
It will be observed that these are years of apprenticeship, not of labor. In considering what is the saving to the wealth of the country, we must estimate the amount of values created by these workmen during the apprenticeship under the first system supposed. Per contra, we must take into account the greater amount of material destroyed in teaching each man to do all the parts, and the greater interruption of the employer or journeyman.
If we suppose these years, saved from apprenticeship, to have an average value of $200, we have a saving of $90,000,000 for each generation of skilled workmen in Massachusetts.
The principle, under which this saving of time is made, cannot be disputed.
8th, It gives opportunity for greater social development, and increases the social power of labor.
This is immediately of moral interest; but it has important economic bearings. The principle itself is indisputable. Not only is the workman brought near his fellows, and, by such contact, stimulated to industry, to acquisition, to taste; not only does such association of purposes and means afford more of the instruments of intellectual advancement, — schools, lectures, churches, journals; not only does the close neighborhood of mind quicken and brighten all the faculties, teaching by example, and firing by controversy; but, by such association, workmen are brought nearer their employers, have a greater sympathy and cooperation, act intelligently and harmoniously as to their rights, and form a public opinion among themselves which has often been found a great power, economically and civilly. Such an association, moreover, brings the workman nearer the government and the public force; sometimes for evil, but often for good. A population thus concentrated is capable of prodigious impulses. All the artisans of the empire are not equal to the mob of the capital. Government knows and respects the power of this class, no matter how fully disfranchised it may be in the law.