1938: Wages, Hours, And Working Conditions

Rates of wages and the full-time work-week remained remarkably stable during 1938. In no large industry was there a general reduction in standards, although they may well have been reduced in isolated cases. The hourly earnings of factory employees declined less than 5 per cent and of bituminous coal miners less than one per cent. The passage of the Fair Labor Standards Act no doubt had the effect of raising the wages and reducing the hours of a considerable number of low paid employees, particularly in the South. But the number affected by the provisions of the Act is not known, and estimates range from 500,000 to several million.

In spite of the depression, labor continued to make improvements in working conditions by winning vacations with pay, improving seniority rules, obtaining more effective control over hiring and firing, and successfully resisting reductions in wages. In consequence, rates of wages in the great majority of American employments remained in 1938 close to their all-time peak, and nominal hours of work remained also at nearly their lowest point.

Because of the great increase in unemployment, however, labor did not fare nearly so well in actual earnings, however successful it may have been in protecting its nominal standards. Factory employees, for example, averaged $22.59 a week in the first ten months of 1938 as against an average of $25.11 in 1937, a decline of 10 per cent. The weekly wages of coal miners in the same period fell from $23.75 to $20.07, or nearly 16 per cent. Only railroad employees received higher weekly earnings in 1938 than in 1937. But in this industry most of the burden of unemployment fell on the labor which was laid off and not on those who remained at work.

A measure of the extent of the decline in jobs and wages during 1938 is afforded by the movement of payrolls and employment. From the peak month of 1937 to the low month of 1938, factory payrolls declined 36 per cent; payrolls in the bituminous coal industry, 47 per cent; and on steam railroads, 23 per cent. Employment from the peak to the low month declined, respectively, 25, 26, and 23 per cent. Since a general improvement in business began in June 1938, the record for the whole year, judged by the data available, is somewhat better. Average factory payrolls for the first 11 months of 1938 were 25 per cent below 1937. In bituminous coal, the decline during this period was the same. And in the railroad industry, where data are available for only the first 10 months of 1938, the decline was 13 per cent. See also LABOR LEGISLATION.