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Here was a system where employers were competing for labour without having to pay for it, and where there was and could be no connection between output and earnings. What was the effect of the elimination of the influence of price on the supply and demand of labour ? The effect on the labourer was very different from the effect on the employer, and one most noticeable moral of the experience in France is just this difference. Earlier political economy largely concerned itself with the psychology of the employer or entrepreneur, and interpreted the psychology of the employed in terms of that of the employer. Much modern speculation concerns itself with the psychology of the employed, and takes for granted the psychology of the employer. Really the two psychologies present problems that are quite different and need to be studied independently.

To consider first the effect of the system on the employed : men in British labour companies were not working for the benefit of a capitalist : they were working for the public good, and that not in any vague sense, but for a definite common end which they all desired. Did that fact in itself provide a sufficient incentive to industry? It was enough to make men in labour companies endure frightful hardship, danger and suffering. It is impossible to speak too highly of the behaviour of the British labour companies. They were all men of low physique; they were shelled in the daytime and bombed at night, with no dugouts to take refuge in, with very little of the psychological stiffening of previous military discipline. But if the question is asked whether the public motives which made them endure all that privation and danger were enough in themselves to make them work from day to day as hard as they would do under ordinary economic conditions, the answer is “ No." I can give no statistics to support my answer, but I have no doubt that most people who saw anything of the work of the Labour Corps would agree that the mere fact that they were working for a public end had not much effect on output, except where their imagination was stirred. Men loading ammunition during an offensive, men laying a track for a gunspur, where they could picture the result of their increased output, did wonders. Men at the base, working day after day on tasks whose immediate bearing on victory was not obviously important, had a low output. The reason for this is simple and not discreditable to human nature. Men like to take an interest in their work, they like to know what they are contributing, they like to be able to appreciate the work of their hands, they like to be in a position to know

when their work is good. If they are treated as cogs in a machine, it does not much matter whether the machine is grinding out profits for individuals or benefits for the public. Being treated as a cog matters more than the purpose to which the machine is put. For treatment as a cog is obvious and ever present to the imagination, the purpose you are serving in the machine is difficult to keep continuously alive in the mind.

In the second place the fact that all were working for a public end did not in itself eliminate ill-feeling between employers and employed. According to the instructions issued when the Labour Directorate was first formed, the Directorate allotted men to the employing services, and the men thus allotted worked under the orders of the officers and N.C.O.s of these services. The technical services indented for labour as they indented for shovels, and some of their officers treated the men allotted to them as though they were living shovels. All the planning and contriving and thinking about how the work was to be done was the business of the men of the technical services, the labour personnel had only to do as they were told. In consequence the labour companies complained of the employing services, as in civil life many workmen complain of their employers. They accused the employing services of taking to themselves the private benefits, i. e. the Military Crosses and the Military Medals and the green envelopes which the labour companies had earned. But their real grievance was just that they were treated as mechanical instruments.

These two points are confirmed by a consideration of the methods employed by the Labour Directorate to increase output.

The first may be described as improvement in company morale. A stand was taken against men being employed except in companies or regular divisions of a company. I remember finding an ammunition dump in an area which my Corps had just taken over, where the labour was done by fifty odd men from seven different companies. The work was far better done by fewer men from one company. Companies and platoons were encouraged to keep records of the work they had done. The efficient labour companies were always intensely proud of their achievements, of the cubic feet per man per day they could excavate, of the ammunition they could load, of their special skill in this or that of the many kinds of job they were turned to. The effectiveness of this encouragement of company morale, and it was great, is only an example of Burke's famous assertion : “ To be attached to the subdivision, to love the little platoon we

belong to in society, is the first principle (the germ as it were) of public affections." The distance which imagination has to travel from the isolated individual to the public cause in any great society is too vast unless it is mediated by companionship in a small society. All devotion to public good implies a common life inspired by and inspiring that devotion, and a real common life can only be lived in a small circle.

The second method appealed to what was practically an economic motive. There was something other than money which everyone did want, and that was leisure. It was possible by the organisation of task work to apply an effective incentive of the economic kind. The task work was always collective. The company or the platoon was given a definite job to do and allowed to go back to camp when they did it. I have called this an economic method, because its effectiveness was quite independent of the fact that men were working for a common end, as was shown by its being equally applicable to British labour, Chinese and prisoners of war. It had the further advantage that if it was to be applied fairly, the company or platoon had to be given some scope as to how they would do the work. It therefore led easily to the notion that the labour unit should be given a distinct task and then allowed to exercise its own judgment on how to carry out the work.

This brings us to the third method, the most suggestive and also the most fruitful of the three. It consisted in laying down that the technical services should state, not how many men they required, but what work they wanted done, and that the responsibility for the work and for contriving how most efficiently to do it was laid upon the labour company. For example, instead of the loading and unloading work in an R.E. yard being carried out by labour working under the orders of R.E. N.C.O.s with the labour officers looking on and seeing that their men did what the R.E.s told them, the company was made responsible for seeing that the required number of trains were loaded or unloaded within the required time. How they did it, what intervals of rest they took, how they arranged their squads, was their affair. They were not living tools, but men assigned a responsible task and given scope to do it.

The results of this method in increased production were extraordinary. A company working on what was called the contracting system did not need the incentive of task work. Officers and men alike found that in tasks which, when working under the orders of the technical services, they had found only

monotonous routine, there was abundant room for thought, for contrivance, initiative and experiment. They established an expert sphere of their own, they acquired professional skill, and with it professional pride. They remained, of course, under orders. They had no power to say what materials should be loaded or where they should be sent. When they dug trenches, the siting and the specification of the trenches was decided by others. But they had no grievance against not being asked to decide on matters on which they had no knowledge, so long as they had scope to decide on matters which their daily experience had led them to understand. To be given that is to be given what a man wants for his work; to be denied it is to be reduced to a living tool, which is Aristotle's definition of a slave. This method not only increased production, it also did away with friction between labour and the technical services. For the conventional relation between employers and employed was substituted the co-operation between two parties, each having its defined sphere of work and enterprise. The elimination of private profit alone had not, as has been noticed, removed the antagonism between employers and employed; the new method, giving labour a sphere of responsibility and initiative, removed the antagonism at once.

These facts seem to confirm the view that in a modern industrial society the fundamental antagonism is not between those who own capital and those who do not, important though that distinction may be, but is between those who take responsibility and manage and discipline, and those who are given no responsibility and are managed and disciplined, and that no solution of industrial problems is possible unless that antagonism is removed. How far the method which proved so successful in the army is applicable to industrial conditions is a difficult question. The work done by the labour corps involved little use of machinery, and therefore gave scope to individual and collective contrivance in a degree which would not be possible with machine production. The army experiments did, however, show that in work which under the old system had seemed to be merely mechanical routine, there was scope for contrivance and planning when men gave their minds to it.

So much for the effect of this sytem on the labourers. The effect on the employer was more startling.

The head of a technical service in any army formation acted as an undertaker in the old economic sense of that term. He undertook, i. e. he made himself responsible to the commander of the army formation that he would complete a definite piece of work by a given date, would have certain lines of railway track laid and working by a given date, would deliver defined quantities of ammunition at a fixed point at fixed intervals, and so on. In making his calculations he had to consider what materials were necessary, and among his materials was included labour. How was he affected by the fact that he had not to pay for his labour, but got it by making out a case that it should be allotted to him? The employer's first impulse, as has been said, was to get under his control enough permanently allotted labour to be saved having to come and get it allotted to him from time to time. The Labour Directorate was organised to stop the intolerable waste created by each service wanting thus to have its own reserve of labour.

When making application for labour under the new scheme, the employer naturally wanted to make himself secure against any failure to carry out his contract through shortage of labour, and asked for as much as he could profitably use if the weather permitted continuous work and if all his materials came to hand up to time, and he no doubt gave himself a margin of safety over and above what these calculations justified. He often calculated that his estimate would be cut down and asked for a good deal more than he expected to get or wanted. If he could not profitably use the labour allotted to him at any time, he kept it working unprofitably in case the men should be found idle and some of them taken away from him and he not have them ready for use when his demand expanded. He was always trying to get a reserve of labour of some kind. Some employers remembered the needs of the army as a whole as well as the needs of their own job, and did not ask for more than they really needed, but no employer in making his calculations had any strong compulsion on him to think how he could save labour. He had plenty of things to think about without that. It was his primary business to take all measures necessary to do the job he had undertaken to do, and as it cost him no more to ask for two companies than for one, he had no encouragement to economise.

The consequence of this was that labour was not used economically. There was a great shortage of labour and employers competed against one another. They were all working for the same end, and yet they constantly took measures in furtherance of their particular function which were prejudicial to the interests of the whole and which really hindered the ultimate purpose for which they were working. The cause of

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