WAGES.
#43. Money Wages and Real Wages.# Wages, as we have already learnt, are
the payments received by a labourer in return for his labour. It does
not matter whether these payments are received daily, weekly, monthly,
quarterly, or yearly. A day gardener is, perhaps, paid every evening; an
artisan is usually paid on Saturday or Friday night, or sometimes
fortnightly; clerks receive their salaries monthly; managers, officers,
secretaries, and others, are paid quarterly, or sometimes half-yearly.
When the wages are paid monthly, or at longer intervals, they are
generally called #salary# (Latin, _salarium_, money given to Roman
soldiers for salt); but if the salary is paid for labour and nothing
else, it is exactly the same in nature as wages.
I said, in the last chapter, that wages consist of a share of the
produce of labour, land, and capital; in the preceding paragraph, I have
been saying that it consists of payments. Here arises one of the great
difficulties of our subject. As a matter of fact, the wages received by
labourers, in the present day, consist almost always of money. A person
working in a cotton mill produces cotton yarn; but he does not receive
at the end of the week so much cotton yarn; he receives so many
shillings. This is much more convenient; for if the labourer received
cotton yarn, or any other commodity which he produces, he would have to
go and sell it in order to buy food and clothes, and to pay the rent of
his house. Instead, then, of receiving an actual share of the produce,
he receives from the capitalist as much money as is supposed to be equal
in value to his share.
Now, we shall see that it is requisite to distinguish between #money
wages# and #real wages#. What a labourer really works for is the bread,
clothes, beer, tobacco, or other things which he consumes; these form
the real wages. If he gets more of these, it does not matter whether he
gets more or less money wages; he cannot eat money, or use it in any way
except to spend it at shops. If corn or cotton becomes dearer, the wages
of every workman are really lessened; because he can buy less corn or
cotton with his money wages. On the other hand, everything which makes
goods cheaper, increases the real wages of workmen; because they can get
more of the goods in exchange for the same money wages. People are
accustomed to think far too much about the number of shillings they get
for a day's work; they fancy that, if they get 25 per cent. more money
wages, they must be 25 per cent. more wealthy. But this is not
necessarily the case; for if the prices of goods on the average have
also risen 25 per cent, they will be really no richer nor poorer than
before.
We now begin to see that to increase the productiveness of labour is
really the important thing for everybody. For if anything, such as
cotton cloth, can be made with less labour, it can be sold more cheaply,
and everybody can buy more of it for the same money, and thus be better
clothed. If the same were the case with other goods, so that linen,
stockings, boots, bricks, houses, chairs, tables, clocks, books, &c.,
were all made in larger quantities than before, with the same labour,
everybody in the country would be better supplied with the things which
he really wishes to have.
It is certain that #a real increase of wages to the people at large is
to be obtained only by making things cheaply#. No doubt a tradesman
gains sometimes when the goods he deals in become dearer, but to the
extent that they are dearer, all consumers of the goods lose, because
they can enjoy less comforts and necessaries. But, if goods are made
cheaply, all consumers gain thereby, and, all people being consumers,
all gain so far as they use the cheapened articles. Nor does it follow
that artisans and tradespeople suffer by the cheapening of goods. If,
owing to some invention, much greater quantities are made with the same
labour, the artisan will probably be able to sell his share of the
produce for more than before, that is, his wages will rise instead of
falling by the cheapening of the produce. The tradesman, again, may gain
less on each separate article that he sells, but he may sell so much
more than before, that his total profits may be increased. The result to
which we come is, then, that #all increase of produce, and cheapening of
goods tends to the benefit of the public, and this is the true way in
which people are made richer#.
#44. How Differences of Wages arise.# It is very important to understand
rightly the reasons of the great differences which exist between the
rates of wages paid in different occupations. Some kinds of labourers
are paid a hundred or even a thousand times as much for a day's work as
others, and it may seem very unfair that there should be such great
differences. We must learn to see that this is the necessary result of
the various characters and abilities of persons, partly arising from the
actual strength of mind and body with which they were born, partly from
the opportunities of education and experience which they have happened
to enjoy. We are often told that all men are born free and equal;
however this may be in a legal point of view, it is not true in other
ways. One child is often strong and stout from its earliest years;
another weakly and unfit for the same exertion. In mind there are still
more remarkable differences.
The rates of wages in different employments are governed by #the laws of
supply and demand# which we shall afterwards consider. Just as goods
rise in price when there is little in the market and much is wanted, so
the price of men's labour rises when much of any particular kind is
wanted and little is to be had. It does not matter much whether we speak
of demand for goods or demand for the labour, which is necessary to make
the goods. If more things of a certain sort are wanted, then more men
able to make them must be found. If I buy an aneroid barometer, I use up
the labour of a man able to make such a barometer; if many people take a
fancy to have aneroid barometers, and only a few workmen have the
necessary skill to make them, they can ask a high price for their
labour. It is true that people buying barometers do not usually pay the
workmen for making them; a man with capital gets the barometers made
beforehand and puts them in shops ready for sale. The capitalist
advances the wages of the workmen, but this is only for a few weeks or
months, and according as the demand for barometers is brisk or slow, he
employs more or fewer workmen. Thus, #demand for commodities comes to
nearly, though not quite, the same thing as demand for labour#. There
is the profit of the capitalist to be considered as well; but, with this
exception, #rates of wages are governed by the same laws of supply and
demand as the prices of goods#.
Anything, then, which affects the numbers of men able and willing to do
a particular kind of work, affects the wages of such men. Thus the
principal circumstance governing wages is the comparative numbers of
persons brought up with various degrees of strength, both of body and
mind. The greater number of ordinary men, while in good health, have
sufficient strength of arms and legs to do common work; the supply of
such men is consequently very large, and, unless they can acquire some
peculiar knowledge or skill, they cannot expect high wages. Dwarfs and
giants are always much less common than men of average size; if there
happened to be any work of importance which could only be done by dwarfs
or giants, they could demand high wages. Dwarfs, however, are of no
special use except to exhibit as curiosities; very large strong men,
too, are not generally speaking of any particular use, because most
heavy work is now done by machinery. They can, however, still get very
high wages in hewing coal, or puddling iron, because this is work,
requiring great strength and endurance, which is not yet commonly done
by machinery. Iron puddlers sometimes earn as much as L250 a year.
It is great skill and knowledge which generally enable a man to earn
large wages. Rich people like to get the best of everything, and thus
the few people who can do things in the best possible way can ask very
high prices. Almost any one can sing badly; but hardly any one can sing
as well as Mr. Sims Reeves: thus he can get perhaps L20 or L30 for every
song which he sings. It is the same with the best artists, actors,
barristers, engineers. An artist is usually his own capitalist, for he
maintains himself during many months, or even years, while he is
painting a great picture; if he succeeds in doing it excellently well,
he can sell the picture for thousands of pounds, because there are many
rich people who wish to possess good pictures.
#45. Adam Smith on Wages.# There are, however, various circumstances
which cause wages in any particular employment to be higher or lower
than in other employments, and we had better attend to what Adam Smith
has said on this subject. He mentioned five principal circumstances
which make up for small wages in some occupations, and balance great
wages in other ones, as follows:
(1.) #The Agreeableness or Disagreeableness of the Employments
themselves.# If an employment is in itself comparatively pleasant, it
attracts many who would not otherwise go into it at the current wages.
Thus, officers of the army and navy are not on the average highly paid;
but there is never any difficulty in finding men willing to be officers,
because the work is thought to be easy, and there is honour and power
attaching to it. On the other hand, a good butcher makes high wages,
because his business is a greasy one, besides being thought to be cruel,
and a clever man must be attracted to it by good earnings.
(2.) #The Easiness and Cheapness, or the Difficulty and Expense of
learning the Occupation.# This circumstance always has much importance,
because the greater number of the people are poor, and are consequently
unable to give their children a long good education. Thus, the larger
part of the young men who grow up are only fit for common manual
employments, and therefore get low wages. To learn a profession, like
that of an architect or engineer, it is requisite to pay a high premium,
and become a pupil in a good office, and then there are many years to be
spent in practising and waiting before profit begins to be made. Hence
the comparatively few who succeed in the difficult professions gain
very high wages.
(3.) #The Constancy or Inconstancy of Employment.# When a man is sure of
being employed and paid regularly all the year round, he is usually
willing on that account to accept a less rate of wages. Thus, there is
little difficulty in finding men to be policemen at about 25 shillings a
week; for though they have to go on duty at night, and their work is
often tedious and disagreeable, yet policemen are nearly sure to have
employment as long as they behave well. A carpenter or bricklayer, on
the contrary, is sometimes thrown out of work, and becomes anxious as to
the means of keeping his family. Masons and bricklayers, who cannot work
during frosty weather, ought of course to have higher wages during the
rest of the year, so as to make up a good average. Dock-labourers, who
are simply strong men without any particular skill, earn large wages
when trade is brisk and many ships come into the docks; at other times,
when trade is slack, or when contrary winds keep ships out of port, they
often fall into destitution through want of employment.
(4.) #The Small or Great Trust which must be reposed in those who
exercise the Employments.# This circumstance considerably affects the
supply of people suitable for certain occupations. A man cannot expect
to get employment in a bank, or in a jeweller's shop, unless he has a
good character. Nothing is more difficult than for a person convicted of
dishonesty to find desirable employment. Thus, a good character is often
worth a great deal of money. Honesty, indeed, is so far common that it
does not alone command high wages; but it is one requisite. The
cleverest man would never be made the manager of a large business, if
there was reason to think that he had committed fraud.
(5.) Lastly, #The Probability or Improbability of Success in Employments
greatly affects the Wages of those who succeed#. In some cases, a man
can hardly avoid succeeding; if he once enlists, he is made into a
soldier whether he likes it or not. Almost all, too, who become clerks
in banks, counting-houses, or public offices, can succeed in doing some
of the work required in such offices. Accordingly clerks are seldom
highly paid. But of those who become barristers, only a few have the
peculiar knowledge, tact, and skill required to make them successful;
these few make very large gains, and the unsuccessful men have to seek
for other employments.
Some occupations are very badly paid, because they can be taken up by
men who fail in other work. Frequently a person who has learnt a trade
or profession finds that he is unfit for it; in other cases, there is a
failure in the demand for a commodity, which obliges its manufacturers
to seek other work. Such people are usually too old and too poor to
begin again from the beginning, and learn a new difficult trade. Thus
they have to take to the first work they can do. Educated men who have
not been successful become secretaries, house-agents, insurance-agents,
small wine merchants, and the like. Uneducated men have to drive cabs,
or go into the army, or break stones; poor women become seamstresses, or
go out charing. Here again we see the need of leaving everybody at
perfect liberty to enter any trade which he can manage to carry on; it
is not only injurious to the public, but it is most unfair to people in
misfortune, if they are shut out of employments by the artificial
restrictions of those who already carry on those employments.
#46. What is a Fair Day's Wages?# It is a favourite saying that #a man
should have a fair day's wages for a fair day's work; but this is a
fallacious saying#. Nothing, at first sight, can seem more reasonable
and just; but when you examine its meaning, you soon find that there is
no real meaning at all. It amounts merely to saying, that #a man ought
to have what he ought to have#. There is no way of deciding what is a
fair day's wages. Some workmen receive only a shilling a day; others
two, three, four, or five shillings; a few receive as much as ten, or
even twenty shillings a day; which of these rates is fair? If the saying
means that all should receive the _same_ fair wages, then all the
different characters and powers of men would first have to be made the
same, and exactly equalised. We have seen that wages vary according to
the laws of supply and demand, and as long as workmen differ in skill,
and strength, and the kind of goods they can produce, there must be
differences of demand for their products. Accordingly, there is no more
a fair rate of wages than there is a fair price of cotton or iron. It is
all a matter of bargain; he who has corn or cotton or iron or any other
goods in his possession, does quite right in selling it for the best
price he can get, provided he does not prevent other people from selling
their goods as they think best. So, any workman does quite right in
selling his labour for the highest rate of wages he can get, provided
that he does not interfere with the similar right of other workmen to
sell their labour as they like.