§ 4. Types of labor organizations. Among the many organizations of wage-earners three main types may be distinguished : the labor-union, the trade-union, and the industrial union, though often they are all spoken of as trade-unions or as labor-unions without distinction. In the more special sense, however, a labor-union is one that admits several classes of wage-earners, sometimes even business and professional men, into the same local chapter. The Knights of Labor is the most notable example that America has seen of this type. The national organization was composed of local chapters, to membership in which every one was elegible excepting bankers, lawyers, gamblers, and saloon-keepers. Organized as a single local chapter in 1869, it grew very rapidly until it attained its maximum membership of 600,000 in 1886. From this point it rapidly declined in membership, and since 1900, although its organization is still maintained, has been of very little influence.

A trade-union is an organization of wage-earners in the same handicraft or occupation. Unions exist among workers in all the old distinctive handicrafts, such as the printers, stone-cutters, cigar-makers, carpenters, and in many others such as musicians and retail clerks. The local chapters in many cases have been long united in national unions (often international, embracing the United States and Canada).

An industrial union is one that seeks to unite all workers. employed in the same class of establishments, regardless of their craft or the kind of work they do. The most notable examples are the United Mine Workers, the Brewery Workers, and the Industrial Workers of the World.

In 1881 a number of national trade-unions united, for certain purposes, to form the American Federation of Labor, with a membership of about a quarter million workers, which has steadily increased since that date. The American Federation of Labor now includes also some important unions of the industrial type.3 Several strong national trade-unions (the most important being the brotherhoods of railroad employees) are not affiliated with the American Federation of Labor.

§ 5. Statistics of labor organisations. The ratio of organized workers to the population is estimated * to be highest in the United Kingdom, being 7 per cent; it is next highest in the German Empire, being nearly 6 per cent; whereas in the United States it is but 2.3 per cent. This difference is largely due to the much greater relative importance of agriculture in the United States.

The total membership of trade-unions in the United States and Canada was estimated (in 1910) to have been about 2,200,000, of which only about 100,000 were in Canada. This was 5.5 per cent of all persons (38,130,000) gainfully employed, or 6.8 per cent of male workers and 0.9 per cent of female workers. Organization was very weak (less than 1 per cent) among the workers in a group of industries occupying nearly one half of all workers, including agriculture, the hand trades, oil and natural gas, salt, and rubber factories. Organization was not of large extent (1 to 10 per cent) in other groups of industries occupying more than one fourth of all workers, including those engaged in producing quarried stone, food-stuffs, iron, and steel, metal, paper and pulp, stationary engineers, in public, professional, and domestic service, and in clerical work. Organization was of much greater strength, including 10 per cent or more of the workers, in the remaining industries and occupations.

If deduction be made of the employing and salaried classes, about 7.7 per cent of all persons occupied were organized. If, further, deduction be made of agricultural, clerical, publicly employed, commercial, and domestic workers, about 16 per cent of the remaining 13,760,000 persons were organized (of women 3.7 per cent). Among the occupations most highly organized are those of railway conductors (87 per cent) and engineers (74 per cent). In the building trades about 16 per cent were organized, of granite-cutters 69 per cent, masons 39 per cent, plasterers 32 per cent, carpenters 21 per cent, and painters 17 per cent. Similar striking differences appear among the occupations in the printing industry; of stereotypers 90 per cent were organized and of compositors only 35 per cent. These figures point to inherent differences in the conditions favoring organization. Even in the same craft a high degree of organization may be found in the cities and little or none in the smaller towns (e. g., in the case of the printing and building trades in general).5

3 In the Federation in 1921 were III national and international unions, representing 34,000 local unions, 46 state branches, 801 city centrals, and 823 local trade and federated labor-unions.

* These and the following figures were compiled before the World War; no revised estimates are as yet available.

§ 6. Collective bargaining. The fundamental policy of trade-unions is the substitution, for the individual wage bargain, of collective bargaining between the delegated representatives of the workingmen and the employer, or group of employers, or their representatives. The wage - earners bargaining collectively may be those of a single establishment, or of a group of establishments in the same locality, or of a wider territory, even national in extent. Accordingly, they are represented in the negotiations by trade-union officials with narrower or wider jurisdiction. Employers in some cases had tacit understandings with one another before laborers were organized. But in many cases the individual employer was at a marked disadvantage after the organization of his employees. The result has been the rapid spread of employers' organizations, so that, in industries where laborers are highly organized, two-sided collective bargaining has become more and more usual.

A large part of the effort of trade-unions is directed toward insuring the use of collective bargaining. This is the purpose of many of their demands, even of some that hardly appear to have any such consideration. Collective bargaining virtually necessitates the use of the "standard rate," since only with reference to some standard rate, a market price for labor, is it possible for a wage contract to be made by labor officials for a group of men. The standard rate may be a piece price or a time price, and in many cases the unions strive to secure the latter as more convenient for their purposes. The standard time rate usually is but a minimum, and many of the more skillful workers receive wages above the minimum. But the standard minimum tends to become also the maximum in many cases, the more so when the union has succeeded in enforcing a pretty high standard rate.

5 See Quarterly Journal of Economics, May, 1916, article by L. Wol-man. Vol. 30, esp. p. 499.