American Notebook The CIO Faces Automation

...There are questionable elements in the plan, however, and the CIO has given no indication whether it is even quietly conscious of them...

...Work stoppages in the first quarter of 1954 were half those of the same period of 1953, and coal mining and textiles, which have been depressed industries for years, have an unusually low record for time lost over strikes and sharp demands...

...Lewis don't fight the machine and the miners are out like a light...

...But most important of all, automation arrives at a time when American industry is particularly conscious of cost savings...

...Commenting on the situation last March, Al Hartnett, secretary-treasurer of the International Union of Electrical Workers, CIO told his membership that while it could be a boon, automation also offered the possibility of...

...The company would be liable to pay out a maximum of eight per cent of its current payroll during unemployment, and the UAW wants a reserve fund of 20 per cent of the base payrolls to be accumulated over a five-year period to cover any additional payments not provided for by the current tax on payrolls...

...While machine production displaces some An article by Gabriel Kolko discussing other aspects of automation, "Nobody Wants to Seem Defeatist—Publicly," appeared in the July 11 New Republic...

...And efforts are being speeded to have the machine replace the worker so far as is possible...

...The analyst is willing to go farther and say that man's creative desire is a troublesome factor when man acts on the basis of creative ability in lieu of following instructions...

...Rather than create more places for workers, the automatic factory seems simply to demand more machines...

...An executive may know nothing about machine tools," said C. F. Hautau, chief engineer of a leading automation firm, last year...

...In 1954 innumerable unions, their companies under economic pressure, took lower wages and accepted bonus schemes in order to preserve their jobs under almost any conditions...

...The aim of the CIO for more equitable income distribution, a goal which seems to be obtainable only through the decisive government action no major party has yet been willing to follow, raises the entire question of what is now minimum union effectiveness...

...a disaster of the first magnitude...

...Overloaded with productive facilities, industry since 1952 has increased the percentage of capital expenditures going to modernization from 51 per cent in that year to an estimated aggregate average of 62 per cent for 1954-56...

...The GAW depends on the state unemployment compensation system, which in March, 1954 contained, after paying out generally low payments to a relatively small number of unemployed for a short time, a total national reserve of $8.6 billion, or a very small fraction of the income which would be lost if unemployment of any magnitude or length existed...

...The general experience in highly automated plants until now has been that the over-all amounts of labor required has been radically reduced, but that the proportion of maintenance workers to whatever labor is needed is much higher than previously...

...The whole story about a musician's life is in the box...

...Describing the trend, Hartnett of IUE declared: "automation is not merely an extension of machine production...

...As Walter Reuther has put it, it is a program that " . . will help to assure a stabilized reservoir of purchasing power during the transition years that seem to lie ahead...

...As automation's effects become more pressing and undermine the present position of organized labor, the inadequacy of its traditional methods for achieving these indispensable goals may have to be faced...

...The classic role of labor increasing the nation's industrial productivity by pricing itself as highly as possible, and hence stimulating the innovation of labor saving devices, has proceeded on the assumption that machines create more jobs than they displace—and promise increasing prosperity for all...

...By giving us enormously increased productivity, on the contrary, it promises to invigorate it...

...In addition to the power and resources built up by organized labor during the late 1930s, consolidated in the early 1940s and defended with success since that time, there is the logic of unionism's historic position on technological innovation...

...If, as automation tends to suggest, labor is displaced at such a ratio and in such a volume as to make exceedingly difficult the possibility of a corresponding rise in production, the problems facing unions are far more indirect and subtle...

...But the operations analyst doesn't find man actually called upon for creative ability in manufacturing operations...

...The worker is coming to be regarded, partly as a result of union pressure, as having as much importance as the machine and requiring as much care in selection and maintenance...

...Eighty years ago there was only one engineer to every 2000 persons in the nation's work force, but today there is one for every 120, with their relative position increasing every year...

...General Electric, for example, was able by modernization to reduce wages as a percentage of sales cost from 47 per cent in 1947 to 36 per cent in 1952...

...Ford, by a program of standardized tools, has reduced its maintenance problems to a minimum...

...If the unemployment lasts beyond a year (in early 1954 a fifth of the workers collecting compensation used up their benefits after 26 weeks) the worker is on his own...

...And if automation is not met with measures equal to the magnitude of the new technology, and substantial unemployment results, organized labor's ability to press for what it now considers its immediate demands can be radically undermined...

...automation holds no threat to our economy...

...The CIO's April conference represented the first major attempt to end the conjecture and shed light on automation...

...The biggest single management job in the factory of the future will be the selection and coordination of the activities of highly trained specialists...

...We hope to be able to eliminate time-and-a-half overtime pay for Saturday and double-time for Sunday that we're now saddled with," frankly admitted one top Texas oil executive quoted in the Wall Street Journal...

...But it is in the realm of demands it cannot negotiate at the bargaining table that the CIO has suggested its most far reaching, and probably relevant, program...

...Indeed, it is the very success of the union's position that has stimulated the movement behind automation...

...Automatic equipment does not strike, talk back to foremen, file grievances, or do any of the things presently obnoxious to management...

...With it he sent Secretary Weeks a copy of a special UAW pamphlet on automation which, amid illustrations of metal men designed by an imaginative artist, included the UAW's immediate program to counteract the negative social consequences of automation...

...If a depression of the intensity of any period of the 1930s existed, the CIO realizes, as simple calculation dictates it must, that both the state and company systems would be hard pressed to maintain payments...

...Taken together, however, all such groups decreased from 63 per cent to 56 per cent...

...Steel has estimated that sales of automatic equipment for metal cutting alone will reach $840 million in 1960 as compared to $120 in 1954...

...Kaiser-Willys, Studebaker, and Panther Valley Coal were the most notable of these...

...The CIO Oil Workers, surveying the impact of automation on the industry, dolefully reported that while refinery production rose 22 per cent from 1948 to April, 1954, the number of production workers had fallen from 147,000 to 137,000...

...An extensive public works program, improved social security and minimum wage laws, and, above all, the need for stronger progressive taxation and wage increases to distribute purchasing power so consumption can keep up with productivity increases, are the key CIO demands...

...Yet the CIO, besides giving this aspect of its answer to automation the least attention, has failed to describe the means by which it hopes to get this program implemented...

...From 1947 to 1953 the output of the electronics industry in the United States increased 275 per cent...

...The possibility that these means may be far from effective, or may create conditions for a new type of unionism based on a relatively few highly skilled workers with economic and social aspirations different from the mass of workers, has yet to be admitted publicly...

...fH The unions face another dilemma, one which has been troubling the economy for a number of years and which will be accentuated under automation...

...From 1910 to 1950 unskilled workers as a percentage of the work force decreased from 36 per cent to 20 per cent, semi-skilled increased from 15 per cent to 22.4 per cent, and skilled workers and foremen increased from 11.7 per cent to 13.8 per cent...

...To oppose it would make labor seem reactionary, but to support it would have meant the elimination of jobs unless wage conditions were tied to increasing productivity...

...Given general instability and insecurity in the economy, the shorter work week could conceivably mean the appropriation of many jobs by those anxious to earn more while they can...

...For it cannot be said that the CIO lacks those who can see the full implications of automation to unionism and society, or that it shares the common thesis that the fear of technological unemployment is a perennial false alarm...

...The only way original employment could be continued or enlarged is by the demand for products expanding enough to necessitate keeping on those not needed at old Ievels of production...

...like going to a pink tea . . , instead of a meeting of radicals...

...Two significant changes are taking place in the battle of man and machine," wrote William Freeman in the New York Times in January, 1953...

...Automation tends to reshift the entire composition of the work force in the direction which makes unionism's organizational position, if not more difficult, certainly more complex...

...Highly skilled labor as we generally think of it today can be eliminated with relative ease by automation...

...Until the CIO sponsored its National Conference on Automation in Washington last April, union activities in the field were sparse...

...1 The guaranteed annual wage is the most essential of the CIO's present answers to automation...

...The amount produced by an eight per cent tax on current payrolls has huge variable possibilities, and is very much dependent on the extent of unemployment...

...Such dramatic examples, recently given increasing publicity, have aroused the unions to the problems of the "era of automation...

...These stipulations only made labor more expensive, intensifying business desire to install new laborsaving devices, and it may now be legitimately asserted that with an tomation the problem of expensive labor is fairly well solved...

...And it is these workers that unionism has shown itself generally incapable of organizing on terms which might preserve the tactical strength it enjoys today by virtue of the role its less trained members possess in the industrial process...

...As consumer markets closed with the depletion of backlogged savings, and industry's expansion needs were brought up to date, concern for increasing labor costs became more pressing—and so did modernization...

...The Dow Chemical Company's highly automatic Madison, Illinois, magnesium mill has about 400 production workers, of which an unusually large ratio of 35 per cent is involved in maintenance functions...

...In Akron the rubber shops have been on a six-hour shift for nearly two decades, and a third of the rubber workers today hold two jobs, many in the rubber plants...

...Nevertheless the CIO's declared goals of increased mass consumption, extension of educational opportunities to readjust the work force to the exigencies of automation, and more equitable income distribution remain...

...Industry's reactions can be measured in the sales of automatic control equipment...

...The CIO, while it acknowledges the seriousness of the problem, is still primarily concerned with what it can do, here and now, to counteract automation's effects within the plant...

...Those in the CIO who understand these possibilities are confined to a relatively few staff members who illustrate the classic dilemma of how far hired hands can publicly deviate from official policy and still keep their tenure...

...In a sense, therefore, the GAW becomes a scheme to provide for workers already employed, and not those about to enter the labor market, shifting from other depressed industries, or out of unemployment payments...

...Employee compensation as a percentage of the private national income has, save for periods of increasing unemployment, hovered very closely to the level of 59 per cent for the last three decades...

...Gompers tried to fight the machine with the cigarmakers and the union went to hell...

...One man doing the work of 100 for Raytheon, or 35 for Chrysler, or 15 for Dow has, despite its exaggeration when abstracted from a total plant process, shaken the organized labor movement into a concern for the possible social and economic consequences of automation...

...But when we talk cost cutting, we talk his language...

...Inspection by automatic gauging and similar devices has cut down the need for labor in quality control...

...Joseph Beirne, CIO Communication Workers' president, reported in April that mechanization on the operating end of the telephone industry had eliminated some 17,000 jobs in 1954 alone...

...Its disadvantages in negotiating during times of unemployment is only a reflection of the effect such an imbalance in its total perspective can have...

...Steel magazine's projected profit and loss statement for an oil pump body factory found the setup and tool change in the automatic factory saving more than half the cost of a regular factory, supervision cost savings two-thirds regular costs, scrap savings one-half, machine repair two-thirds, while labor costs were less than onethird that of the ordinary plant...

...Over the same period employment of labor in the industry increased only 40 per cent...

...PHILIP R. MARVIN in Automation, April 1954...

...UAW and CIO convention resolutions advocating preventive economic measures they would undoubtedly have sponsored anyway, and, above all, the need for further study, figured in with several pronouncements on the topic by Walter Reuther...

...At the end of 1954, when electronics production was about equal to the peak of 1953, nine per cent fewer workers were employed and the average work week had fallen almost an hour...

...Semi-skilled labor has an increasingly unimportant role in automation simply because the workers that are needed have increasingly attendant and routinized functions—involving the type of manual operations most susceptible to continued automation...

...It is instead as great a revolution as machine production itself...

...During the favorable market following World War II, labor in manufacturing industries was able to surpass slightly in earnings the increase in man-hour productivity...

...I advise youngsters to stay out of it—for the time being, anyway...

...Save for the highest five per cent, taxation has made little difference in this pattern...

...And it is in this realm that unionism has shown itself perplexed and unable to act with the decision it long ago discovered was necessary on the bargaining table and picket line...

...The typical auto worker of the future may be a skilled maintenance man, engineer, or analyst" declares the UAW in its pamphlet on the topic...

...The shares of the national money income going to the lowest half of the income earners, those most in need of increased purchasing power, shifted from 26.8 per cent in 1910 to 21 per cent in 1952...

...The underlying assumption in both cases is that the reallocation of manpower, and not unemployment, will present automation's most serious problem...

...One CIO staff member has privately admitted that with automation all the GAW may turn out to be is a glorified severance pay scheme...

...Commenting during the height of unemployment in 1954, one company official told a Wall Street Journal reporter that union negotiations had become...

...Because of the tactical convenience of concentrating on immediate wage and working conditions, and because it has not approached broader social and economic issues with the same seriousness, American unionism has historically been victimized by those larger economic forces beyond the reach of routine union activity...

...Several international unions, faced with declining employment due to technological innovation, had already investigated the situations within their industries...

...It is these workers, and those with highly specialized training, that have an increasingly important role in automation...

...First, it does not answer the problem of the displacement of traditional skills altogether, which will be discussed later...

...And over-all sales for instruments for industrial control in 1960 will reach an estimated 1700 per cent over the 1930 level as compared to an estimated increase for all plant and expenditures of 450 per cent over the same period...

...State payments are to be supplemented by the company to the extent of providing any workers with two or more years seniority the equivalent of a 40-houraweek pay check for a full year...

...workers, automation could displace MOST workers...

...We're playing at our own funeral...

...In the context of automation's ability to displace labor, the theory is ready for basic reappraisal along with many other traditional beliefs...

...CHARLES BABBAGE, The Economy of Machinery, 1832...

...Simple retraining and seniority agreements, while humanely vital, tend to become secondary to the central issues of income distribution, underconsumption on the part of lower income groups, and the premises on which the economy operates...

...And automation holds out, the CIO is willing to admit, the possibility of just such unemployment...

...Automatic control boards indicate when tools should be replaced, thereby cutting down labor needs and preventing serious repair problems...

...Donald Campbell, Massachusetts Institute of Technology engineer, sounded a similar note, and Georgia Tech economist Walter S. Buckingham, Jr., consoled "that the longrun, over-all outlook for labor as a result of automation is good " Somewhat disappointed by the inability of experts to provide it with a more concrete portrait of the automated future, the CIO continues to lack the assurance and optimism of certainty...

...In addition to preventing seasonal layoffs in such industries as auto which regularly suffer from the problem, discouraging mass layoffs of workers in old plants after constructing new ones, and guaranteeing forty hours' pay to a worker for each week he is called in, the GAW, as the UAW initially proposed it, is essentially an attempt to extend and enlarge unemployment compensation to 52 weeks...

...The challenge to unionism on this level alone is basic...

...When Secretary of Commerce Sinclair Weeks attacked "scaremongers" and "bogeymen of automation" in March, Reuther took it as an affront to the UAW and American people and brought automation to the headlines with the demand for an apology...

...Yet the average amount of capital investment for each production worker in the Dow plant is still eleven times greater than the average in all U. S. industry...

...And thirdly, the experience of unions with the 36-hour week has been anything but happy...

...The unequivocal statement can be made that creative talents can't be automatized...

...Meanwhile, unionism's dilemma with automation is best epitomized by a statement made by James Petrillo of the Musi cians Union a few years ago: Unless something radical happens in the near future, it's a bad business for musicians...

...One of the most singular advantages we derive from machinery is in the check which it affords against the inattention, idleness, or the knavery of human agents...

...It starts and finishes right there...

...The company with the most room between costs and current prices is obviously in the best shape" was one auto executive's solution to an increasingly tight market, according to the Wall Street Journal...

...Indeed, the speed of processes in automatic factories has simply tended to demand more machinery to meet the tempo in all phases of production...

...Yet without some radical shifts towards a level of distribution which would make it possible for mass consumption to keep up with the productivity increases of automation, there seems reasonable assurance that unemployment will follow...

...Automation remains an ominous question mark, and American labor seems willing to entertain more imagination in solving it than any other social or economic issue of the past decade...

...The idea of a shorter work week would also present several major problems under automation...

...The facts," declared the last CIO convention, "allow no room for the illusion that expansion of employment in the manufacture of the revolutionary new machines will compensate to any substantial degree for contraction of employment in the industries using them...

...writes indus try's Factory Management and Maintenance...

...It is in its demands for a more equitable distribution of consumers' purchasing power and extended governmental planning that the CIO has raised its most significant answer to automation...

...The CIO also knows the GAW has made it a distinct economic advantage for companies simply to introduce more automation rather than hire new workers to whom it might have to pay future GAW payments...

...John Diebold, editor of industry's Automatic Control, told the conferees...

...11 There has arisen a general consensus, both among business and labor economists, that workers under auto mation will pass from the direct production lines to maintenance functions, and will still be needed to keep automatic machinery in operating order...

...There is secondly the fact that a floor has to be placed on the extent to which a work week can be cut, since the trend in its decline has been geometric and not arithmetic, and to cut 25 hours off the work week within a generation or so, as we did from 1870 to 1950, leaves about a 15-hour work week...

...The mere fact that a new machine is being introduced into a plant indicates a net dimunition of labor employed, or else no economy would be affected...

...In March, 1954, when the machine tool industry's backlog of orders was down to a low 4.6 months of the current rate of production, many companies making special purpose tools for automation had backlogs of up to two years...

...It also included reference, for those desiring more information, to Norbert Wiener's cryptic and now complacent The Human Use of Human Beings and Karel Capek's science fiction drama, R. U. R. Both the UAW and CIO assigned special staff members to keep tabs on developments in the field, but the UAW's James Stern frankly admitted last April that he could give no answers to the problems of automation, and that those he had seen so far were " .. . a lot of speculation based on little knowledge...