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Technological Change: A National Inventory of Its Consequences

by David Weintraub

May 1937


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The extent to which individuals are affected by the displacement and absorption effects of technological improvements cannot be measured adequately with the data now available. There are indications, however, that we are heading toward greater instability of employment. This trend is traceable in part to technical industrial progress, which has been accompanied by a relative increase in the production of capital equipment and durable consumers' goods as compared with the production of other goods. The initial purchase of durable goods can often be postponed, their replacement delayed. During depression periods, therefore, their production drops further and at a more rapid rate than the production of non-durable goods. Since, as a long term trend, an increasing portion of our economic effort is devoted to the production of capital equipment and other durable goods, involving a growing proportion of worker-consumers, it seems clear that one of the important effects of our progress in industrial technology is greater instability in production and hence in employment.

Aside, however, from these general questions of the swings in the production of the nation's goods and services and the distribution of the nation's income, there are obvious problems involving the adjustment of individual workers to evolving industrial processes. However moderate or cataclysmic industrial fluctuations may be, industrial techniques will continue to change and these changes will modify the skills required in production processes and the geographic location of job opportunities. Individual workers will be forced out of their jobs as occupational requirements change; they will have to search for employment or they will need to acquire a new skill and, unless somehow compensated by society, they will, with their time and wages lost in the adjustment process, pay part of the price of the social and economic progress made possible by changing industrial techniques.

American industrial engineering has concentrated upon the creation of machines and processes whereby goods and services may be produced with constantly diminished human effort. Without the technical development of the past we could not have attained the higher plane of material well-being which we have come to accept as normal. But while engineering has been geared to the continual improvement of mechanical efficiency, other costs and values have frequently been overlooked. New machines are rigorously tested so that mechanical efficiencies are fairly well known before their introduction into an industry, but changes in the human requirements are almost completely disregarded. Frequently the effects on the individual workers are realized only after workers possessing skills accumulated during the best years of life find themselves forgotten on the industrial scrap heap. Provision for the obsolescence of machinery due to technological change is usually made in the cost accounting systems of industry and is an important consideration in the introduction of new machinery, but it is the exceptional management which provides for its displaced labor force. Yet, technological change junks the skills of workers as surely as it renders worthless machinery which has not been worn out.

Our efficiency is in part responsible for today's relief rolls. If unemployment in 1937 is to be cut to its 1929 level, then the production of goods and services must be stepped up 20 percent above the output of the last boom year. This is set forth in a recent report on one aspect of the Works Progress Administration study of Reemployment Opportunities and Recent Changes in Industrial Techniques. The report points out that while the "nation's output increased 46 percent from 1920 to 1929, there was a simultaneous increase of only 16 percent in the nation's labor force." Man hours required to turn out one manufactured unit were cut more than one third between 1920 and 1934. The report indicates that the trend is toward greater technical efficiency, calling for an increasing expansion in production and marketing if unemployment in this country is to be brought down to 1929 figures and held there.

The WPA study of recent changes in industrial techniques and their effects on employment and unemployment was organized in December 1935. The task was to assemble and analyze existing information bearing on the problem, and to supplement this data by field techniques. Surveys have been made of a number of industries—manufacturing, mining, agriculture and railroad transportation. To help complete the picture, employment histories of more than 20,000 workers have been collected, showing the effect of technical change on individual wage earners.

The project has had the cooperation not only of industry and labor, but of governmental and private agencies, including the Departments of Labor, Commerce and Interior, the Railroad Retirement Board, Social Security Board, Bureau of Internal Revenue, Federal Trade Commission, National Bureau of Economic Research, the Employment Stabilization Research Institute of the University of Minnesota, and the Industrial Research Department of the University of Pennsylvania.

In the succeeding pages Mr. Hine presents pictures selected to illustrate one phase of the project, the impact of industrial evolution on the skills of a group of factory workers.

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