TRANSACTIONS OF SECTION F. 



833 



In the mountain section of the southern United States the people are still clad in homespun fabric 

 Five women — two carders, two spinsters, and one weaver — can produce eight yards per day. 



Product of 5 per- 

 sons 1 year in 

 No. Carolina . . 



Product of 5 per- 

 sons in New 

 England . . . 



Wages in New 

 England at 1 

 08-100 cts. & yd. 



Wages as they 

 would be in N. 

 Carolina at 1 

 08-100 cts. f yd. 



■Cost #■ yard in N. 

 England at $287 

 Vjt. each opera- 

 tive 



tost in No. Caro- 

 lina at §287 

 ^■yr. each opera- 

 tive 



§287.00 



§5.19 



1.0S cts. 



58.49 cts. 





The rule of diminishing rates of profit and increasing rate of wages, of necessity ensuing from 

 the progress of invention, is fully sustained by these tables. As the capital is increased both in its 

 quantity and in its effectiveness, the absolute share of product falling to capital is increased, but the 

 relative share is diminished. On the other hand, the share of the labourer is increased, both abso- 

 lutely and relatively. Labour takes, of necessity, a constantly increasing proportion of an increasing 

 product. In this example, the wages of the operatives have increased since 1840. 64 per cent, pf r 

 day and 9(i per cent, per hour ; since 1830, 77 per cent, per day and+ 100 per cent, per hour. High 

 wages in money have ensued as the necessary result of the low cost of labour. 



It will be observed that in 1840 the price of standard sheetings being 9 cents a yard it required 

 1.18 cents to be set aside for profits, or 13 per cent, of the price, in order to pay 10 per cent, upon the 

 capital. Next it required 1.83 cents to be set aside, being 20 per cent, of the whole price to pay wages 

 at the average rate of only §175 a year to each operative. In 1884, the price being 7 cents a yard, it 

 required less than per cent, of the gross sales, - 40 cents a yard, to be set aside in order to "pay Id 

 per cent, upon the capital, while 1.07 cents being set aside as the share of labour, or a fraction over 

 15 per cent, of the gross sales, yielded to the operative §290 in gold. The goods cannot now be 

 sold at 7 cents, and there is little or no profit for the time being. But while 10 per cent, was a mode- 

 rate rate of profit in 1840, it is an excessive rate in 1884. The business would extend with great 

 rapidity if there were a positive assurance of 6 per cent, upon the capital or a quarter of a cent a yard 

 and less than H per cent, of the gross amount of sales. 



But it may be said, having assigned 0.40 cents to profits, and 1.07 cents to labour out of 7 cents 

 a yard gross value, there remains 5A cents a yard to be accounted for. This of course represents the 

 money-cost of cotton, fuel, starch, oil, supplies, taxes, cost of administration, transportation of the 

 goods to market, and the cost of selling them at wholesale. 



Does this all go to labour, or is there also a profit to be set aside on these elements ? 

 Our space would not suffice to treat each one of these subjects, but it may be said. First, the cotton is 

 substantially all labour ; there is no large margin of profit at the present time in raising cotton, which 

 is mostly produced by small fanners. Second, the other items constituting the materials form a very 

 small part of the total cost, and are subjected to profits in small measure only in respect to fuel and oil. 

 The cost of transportation yields to the railroads less than an average of 5 per cent, of the capital 

 invested, and cotton fabrics pay but a small fraction of their value even for very long distances. The 

 cost of administration constitutes a very small part of the cost of the goods, and in the general 

 treatise of wages belongs to a class by itself rather than to be considered as profits. The charge for 

 selling the goods at wholesale does not exceed 1 per cent, to 1J per cent., and a large part of this is 

 distributed among the clerks and salesmen who do the work. 



If the subject is analysed, — first, as a whole, and, second, in each department, — it will appear that 

 at the present time the proportion of profit which can be set aside from the sale of coarse cotton goods 

 sufficient to cover profits in all the various departments of the work, is less than 10 per cent, of the 

 wholesale market value of the product, and 90 per cent, is the absolute share of the labourers who do 

 the work both in respect to materials used and to the finished product. 



It is also necessary to remember in respect to the cotton factory that the value or proportion of 

 •capital to a given product is greater than in almost any other branch of industry. The proportion of 

 capital to product being §1 of capital to each SI or $1.50 of product, according to the weight of the 

 fabric and the quantity of cotton used. In the boot and shoe factory, on the other hand, the ratio of 

 capital to product is about $1 to $3 ; therefore in the boot and shoe business a much less proportion of 

 the gross sale needs to be set aside as profit on the business, to induce its being established. 



On the whole, so far as the manufacturers of New England are concerned, the average of capital 

 to the gross value of the products is one dollar capital to two dollars product ; therefore 3 per 

 cent, of the gross sales set aside as profit will yield 6 per cent, per annum upon the capital invested 

 in the buildings and machinery, which are applied to the conversion of raw or half-manufactured 

 material into finished forms ready for final consumption. 



1884. 3 h 



