Labor cost

“ But since the cost of production to the capitalist is not labor but wages, and since wages may be either greater or less, the quantity of labor being the same, it would seem that the value of the product can not be determined solely by the quantity of labor, but by the quantity together with the remuneration, and that values must partly depend on wages. ”

“ WAGES OF LABOR.—THE MINIMUM OF WAGES.
Human labor cannot, any more than any other commodity, be supplied, in the long run, at a price below the cost of production. [161-1] [161-2] The cost of production here embraces not only the necessary or customary means of subsistence of the workman himself, but also of his family; that is, of the coming generation of workmen. The number of the latter depends essentially on the demand for labor. ”

“ Wages, in public discussions, both oral and printed, being looked upon from the same point of view of the payers, much oftener than from that of the receivers, nothing is more common than to say that wages are high or low, meaning only that the cost of labor [to the capitalist] is high or low. The reverse of this would be oftener the truth: the cost of labor is frequently at its highest where wages are lowest. ”

“ Would it ever be possible for him to pay the laborers MORE than the value of their labor power and to sell their products at LESS than their value, and still make a profit? Explain why this would be possible.
Are the workers any better off where the cost of living is low than where the cost of living is high? Are they able to save any more in the countries of low prices? Do low prices benefit the working class? Do we find wages high or low where the cost of living is high? Where the cost of living is low? Does a low cost of living benefit the capitalists? ”

“ The law then intervenes, making labor in effect more expensive for all by requiring the superior conveniences or by compelling employers' insurance against accidents to workmen or by enforcing outright a higher minimum wage. The old basic labor cost becomes thus obsolete. ”

“ The real connection between the proper conception of cost of production and cost of labor is, however, worth attention. It touches cost of labor through that one of its elements called “efficiency of labor.” The more productive an industry is, the higher its wages and profits may be, and it is exactly at this point that more attention should be given to the relations of labor and capital. ”

“ That argument is that it will prove impossible to maintain uniform standard wage rates throughout an industry in which the various enterprises are distributed over a wide area; in the several parts of which area the cost of living, the general conditions of labor, and the demand and supply situation for labor differ considerably. ”

“ As a rule, it is found, that the cost of labor in reference to a given product is the least in those countries, like the United States and Great Britain, in which the rates of nominal wages are the highest; because, it is found also, that a high efficiency of laborers accompanies both as a cause and as an effect high rates of wages. ”

“ Labor-saving machinery reduces cost by increasing the productive power of labor; a reduction of wages reduces cost by reducing the share of the product which falls to the laborer. To the employer the effect may be the same; but, to the community, which includes both employers and employed, the effect is very different. In the one case there is increase in the general wealth; in the other there is merely a change in distribution—whatever one class gains another class necessarily losing. Hence the effect of cheap labor is necessarily very different from that of improved machinery. ”

“ Thus we see that increased wages, when common to all descriptions of productive laborers, and when really representing a greater Cost of Labor, are always and necessarily at the expense of profits. And by reversing the cases, we should find in like manner that diminished wages, when representing a really diminished Cost of Labor, are equivalent to a rise of profits. ”

“ Suppose our laborer produces 12 pieces of a certain commodity during 12 hours. The cost of the raw material, the wear and tear of the machinery amounts to say 1.331⁄3 cents, the piece sells at 1.662⁄3 cents. In such a case, the capitalist, given the same terms as above, will pay the laborer a little over 161⁄2 cents a piece, for 12 pieces—9 dollars, for which the laborer has toiled 12 hours. ”

“ Scientific management, on the contrary, has for its very foundation the firm conviction that the true interests of the two are one and the same; that prosperity for the employer cannot exist through a long term of years unless it is accompanied by prosperity for the employee, and vice versa; and that it is possible to give the workman what he most wants—high wages—and the employer what he wants—a low labor cost—for his manufactures. ”

“ To whatever extent it is so, this smaller cost of labor, being not general, but limited to those employments, is just as much a cause of cheapness in the products, both in the home and in the foreign market, as if they had been made by a less quantity of labor. ”

“ And just as the value of other commodities is determined by the amount of social labor necessary on an average for their reproduction, so the value of labor-power is likewise determined. Wages tend to a point at which they will cover the average cost of the necessary means of subsistence for the workers and their families, in any given time and place, under the conditions and according to the standards of living generally prevailing. Trade union action, for example, may force wages above that point, or undue stress in the competitive labor market may force wages below it. ”

“ On the other hand a large class of farm laborers are purely wage earners.
Whatever be the kind of farmer his income is derived from the sale of his products, less the direct cost of producing them. The direct cost of production includes the labor that he has to buy, the materials that he has to use, and finally the labor and material that he must apply in order to maintain the fertility of his land and the upkeep of his buildings, live stock, machinery, fences, ditches, etc. ”

“ The efficiency of labor may be regarded as affecting either the demand for labor on the one hand or the supply of it on the other, according as we look at the matter from the worker's or the employer's standpoint. The employer is concerned with the labor costs per unit of his output, the worker is concerned with the wages he receives. An increase in the efficiency of labor may, and usually will, mean both a decrease in labor costs to the employer and an increase in the earnings of the worker. ”

“ The statistics show that the average increased cost of twelve articles most required in daily consumption in 1874 over 1860 was ninety-two per cent., while the average increase of wages of eight artisans, cabinet-makers, coopers, carpenters, painters, shoemakers, tail-ors, tanners, and tinsmiths, was only sixty per cent., demonstrating that the purchasing power of labor had under protection in thirteen years depreciated 19.5 per cent. But protection has not even raised the nominal wages in most of the unprotected industries. ”

“ The laborer’s demand for an increased wage was always based upon an increased cost of living, which was itself chiefly due to increased cost of production from reluctant concessions of his former demands. ”

“ This partial rise of wages, if not gained at the expense of the remainder of the working class, ought not to be regarded as an evil. The consumer, indeed, must pay for it; but cheapness of goods is desirable only when the cause of it is that their production costs little labour, and not when occasioned by that labour's being ill remunerated. It may appear, indeed, at first sight, that the high wages of the type-founders (for example) are obtained at the general cost of the labouring class. ”

“ In the beginning, money wages would probably remain the same as before, and the labourers would have the full benefit of the cheapness. They would be enabled to increase their consumption either of food or of other articles, and would receive the same cost, and a greater quantity. So far, profits would be unaffected. But the permanent remuneration of the labourers essentially depends on what we have called their habitual standard; the extent of the requirements which, as a class, they insist on satisfying before they choose to have children. ”

“ The employer ought to know that the more jobs that pass through or over a workman’s machine or bench in the shift or working day the greater is the number of jobs over which standing and fixed charges and the invariable portion of the working costs are apportioned, and, therefore, the smaller is the debit on each operation and the lower is the cost of production. ”

“ The effect of all the circumstances which give rise to the differences between wages in different occupations may be included as supply and demand, and it is perfectly correct to say that the wages in different occupations will vary relatively according to differences in the supply and demand of labor—meaning by demand the call which the community as a whole makes for services of the particular kind, and by supply the relative amount of labor which, under the existing conditions, can be determined to the performance of those particular services. ”

“ If the numbers in any group of wage earners are high relative to the uses in which the employment of the members of that group results in a considerable addition to the product of market values, the wages of that group will be low, and vice versa. The need of the productive system for any kind of labor, relative to the supply available to fill that need is an important factor in determining the reward paid for that labor. ”

“ If the productive organization has at its command a plentiful supply of capital; if in the community there are many men possessed of a high order of business ability; if then, 55 labor for the commoner tasks of production is relatively scarce, the work of the ordinary wage earner will be a means of adding considerably to the total of market values produced. Or, as it is sometimes put, each use of labor will be an important use. Labor will be in great demand, and wages will be high. ”

“ Finally, that large portion of the productive capital of a country which is employed in paying the wages and salaries of laborers, evidently is not, all of it, strictly and indispensably necessary for production. As much of it as exceeds the actual necessaries of life and health (an excess which in the case of skilled laborers is usually considerable) is not expended in supporting labor, but in remunerating it, and the laborers could wait for this part of their remuneration until the production is completed. ”

“ We see how an increase in the value of A means a consequent increase in the value of labor-power. We must not, therefore, berate the grocer, the butcher or landlord when our employers fail to pay us the value of our labor-power. We will be forced to demand higher wages in order to live. ”

“ While capital invested in manufactures is yielding adequate and fair profits under the new system, the wages of labor, whether employed in manufactures, agriculture, commerce, or navigation, have been augmented. The toiling millions whose daily labor furnishes the supply of food and raiment and all the necessaries and comforts of life are receiving higher wages and more steady and permanent employment than in any other country or at any previous period of our own history. ”